Exhibit 10(8)
*
Aircraft N610FF
Aircraft N611FF
Airframe N608FF
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TRUST AGREEMENT
Dated as of October 1, 1996
between
SANWA BUSINESS CREDIT CORPORATION,
Owner Participant
and
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Owner Trustee
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Two Boeing Model 747-282B Aircraft
One Boeing Model 747-131 Airframe
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TABLE OF CONTENTS
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Page
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ARTICLE I
DEFINITIONS AND TERMS.............................. 1
SECTION 1.01. Certain Definitions............................................ 1
ARTICLE II
AUTHORITY TO EXECUTE CERTAIN OPERATIVE DOCUMENTS;
DECLARATION OF TRUST............................ 2
SECTION 2.01. Authority to Execute Documents................................. 2
SECTION 2.02. Declaration of Trust........................................... 2
ARTICLE III
PURCHASE OF THE AIRCRAFT AND AIRFRAME N608FF................. 2
SECTION 3.01. Purchase of the Aircraft and Airframe N608FF................... 2
SECTION 3.02. Conditions Precedent........................................... 3
ARTICLE IV
RECEIPT, DISTRIBUTION AND APPLICATION
OF INCOME FROM THE TRUST ESTATE........................ 4
SECTION 4.01. Distribution of Payments....................................... 4
(a) Payments to Owner Trustee............................. 4
(b) Multiple Owner Participants......................... 4
SECTION 4.02. Method of Payments............................................. 4
ARTICLE V
DUTIES OF THE OWNER TRUSTEE........................... 5
i
SECTION 5.01. Notice of Event of Default..................................... 5
SECTION 5.02. Action Upon Instructions....................................... 5
SECTION 5.03. Indemnification................................................ 5
SECTION 5.04. No Duties Except as Specified in Trust Agreement
or Instructions............................................. 6
SECTION 5.05. Satisfaction of Conditions Precedent........................... 6
SECTION 5.06. No Action Except Under Specified Documents or
Instruction................................................. 6
ARTICLE VI
THE OWNER TRUSTEE............................... 7
SECTION 6.01. Acceptance of Trusts and Duties................................ 7
SECTION 6.02. Absence of Certain Duties...................................... 7
SECTION 6.03. No Representations or Warranties as to Certain
Matters..................................................... 8
SECTION 6.04. No Segregation of Monies; Interest............................. 8
SECTION 6.05. Reliance Upon Certificates, Counsel and Agents................. 9
SECTION 6.06. Not Acting in Individual Capacity.............................. 9
SECTION 6.07. Fees; Compensation............................................. 9
SECTION 6.08. Tax Returns................................................... 10
ARTICLE VII
INDEMNIFICATION OF FIRST SECURITY BANK
BY OWNER PARTICIPANT............................. 10
SECTION 7.01. Owner Participant to Indemnify First Security Bank............ 10
ii
ARTICLE VIII
TRANSFER OF THE OWNER PARTICIPANT'S INTEREST................. 11
SECTION 8.01. Transfer of Interests......................................... 11
SECTION 8.02. Actions of the Owner Participants............................. 12
ARTICLE IX
SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES................... 12
SECTION 9.01. Resignation of Owner Trustee; Appointment of
Successor.................................................... 12
(a) Resignation or Removal............................. 12
(b) Execution and Delivery of Documents,
etc.................................................... 12
(c) Qualifications......................................... 13
(d) Merger, etc............................................ 13
SECTION 9.02. Co-Trustees and Separate Trustees............................. 13
ARTICLE X
SUPPLEMENTS AND AMENDMENTS
TO TRUST AGREEMENT AND OTHER DOCUMENTS.................. 15
SECTION 10.01. Supplements and Amendments and Delivery Thereof.............. 15
(a) Supplements and Amendments........................ 15
(b) Delivery of Amendments and
Supplements to Certain Parties......................... 15
SECTION 10.02. Discretion as to Execution of Documents...................... 15
SECTION 10.03. Absence of Requirements as to Form........................... 15
SECTION 10.04. Distribution of Documents.................................... 16
iii
SECTION 10.05. No Request Needed as to Lease Supplement and
Trust Supplement........................................... 16
ARTICLE XI
MISCELLANEOUS................................ 16
SECTION 11.01. Termination of Trust Agreement............................... 16
SECTION 11.02. Owner Participant Has No Legal Title in Trust
Estate..................................................... 17
SECTION 11.03. Assignment, Sale, etc. of Aircraft and Airframe
N608FF..................................................... 17
SECTION 11.04. Trust Agreement for Benefit of Certain Parties
Only....................................................... 17
SECTION 11.05. Citizenship of the Owner Participant......................... 17
SECTION 11.06. Notices...................................................... 17
SECTION 11.07. Severability................................................. 18
SECTION 11.08. Waivers, etc................................................. 18
SECTION 11.09. Counterparts................................................. 18
SECTION 11.10. Binding Effect, etc.......................................... 18
SECTION 11.11. Headings; References......................................... 18
SECTION 11.12. Governing Law................................................ 18
ARTICLE XII
CERTAIN LIMITATIONS............................ 19
SECTION 12.01. Limitations on Control....................................... 19
SECTION 12.02. Discretion and Actions of Owner Trustee...................... 19
iv
SECTION 12.03. Payments..................................................... 20
SECTION 12.04. Owner Trustee Acts as Trustee................................ 20
SECTION 12.05. Termination.................................................. 20
SECTION 12.06. Amendments to Article XII.................................... 20
SECTION 12.07. Purpose...................................................... 21
Exhibit A
TRUST AGREEMENT SUPPLEMENT............................. 1
v
TRUST AGREEMENT
This TRUST AGREEMENT dated as of October 1, 1996, between SANWA
BUSINESS CREDIT CORPORATION, a Delaware corporation (the "Original Owner
Participant"), and FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking
association (in its individual capacity, "FSB" and otherwise not in its
individual capacity but solely as trustee hereunder with its permitted
successors and assigns the "Owner Trustee");
W I T N E S S E T H:
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ARTICLE I
DEFINITIONS AND TERMS
SECTION 1.01. Certain Definitions. Unless the context shall
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otherwise require and except as contained in this Section 1.01, the capitalized
terms used herein shall have the respective meanings assigned thereto in the
Lease (as hereinafter defined) for all purposes hereof. All definitions
contained in this Section 1.01 shall be equally applicable to both the singular
and plural forms of the terms defined. For all purposes of this Trust Agreement
the following terms shall have the following meanings:
"Corporate Trust Department" shall mean the office of the Owner
Trustee located in Salt Lake City, Utah.
"Lease" means that certain Operating Lease Agreement, dated as of
October 1, 1996 and to be entered into by the Owner Trustee and Tower
concurrently with the execution and delivery of this Trust Agreement as said
Operating Lease Agreement may from time to time be supplemented or amended, or
the terms thereof waived or modified, to the extent permitted by, and in
accordance with, the terms of this Trust Agreement. The term "Lease" shall also
include each Lease Supplement from time to time entered into pursuant to the
terms of the Lease.
"Owner Participant" shall mean the Original Owner Participant and each
Subsequent Owner Participant.
"Subsequent Owner Participant" means any Person to which the Original
Owner Participant or any transferee from the Original Owner Participant or any
Subsequent
[Trust Agreement]
Owner Participant shall have transferred at any time after the Delivery Date all
or any part of its right, title and interest in the Trust Estate.
"Tower" means Tower Air, Inc. organized and existing pursuant to the
laws of its jurisdiction.
"Trust Estate" means all estate, right, title and interest of the
Owner Trustee in and to the Aircraft, Airframe N608FF, the Lease, any Lease
Supplement and the Purchase Agreement, including, without limitation, all
amounts of Basic Rent and Supplemental Rent and all insurance proceeds (other
than insurance proceeds payable to or for the benefit of FSB for its own account
or in its individual capacity).
"Trust Supplement" means a supplement to the Trust Agreement in
substantially the form of Exhibit A to this Trust Agreement.
ARTICLE II
AUTHORITY TO EXECUTE CERTAIN OPERATIVE DOCUMENTS;
DECLARATION OF TRUST
SECTION 2.01. Authority to Execute Documents. The Original Owner
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Participant hereby authorizes and directs the Owner Trustee to execute and
deliver the Operative Documents to which it is a party and any other agreements,
instruments or documents to which the Owner Trustee is a party in the respective
forms thereof delivered from time to time by the Owner Participant to the Owner
Trustee for execution and delivery.
SECTION 2.02. Declaration of Trust. The Owner Trustee hereby
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declares that it will hold the Trust Estate upon the trusts hereinafter set
forth for the use and benefit of the Owner Participant.
2
[Trust Agreement]
ARTICLE III
PURCHASE OF THE AIRCRAFT AND AIRFRAME N608FF
SECTION 3.01. Purchase of the Aircraft and Airframe N608FF. The
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Original Owner Participant hereby authorizes and directs the Owner Trustee to,
and the Owner Trustee agrees for the benefit of the Owner Participant that it
will, on the Delivery Date, subject to due compliance with the terms of Section
3.02 hereof:
(a) purchase the Aircraft and Airframe N608FF from Tower pursuant to
the Purchase Agreement;
(b) accept delivery from Tower of the Warranty Bills of Sale and the
FAA Bills of Sale;
(c) execute and deliver the Lease;
(d) execute and deliver a Lease Supplement covering the Aircraft and
Airframe N608FF;
(e) execute and deliver a Trust Supplement covering the Aircraft and
Airframe N608FF;
(f) effect the registration of the Aircraft and Airframe N608FF in the
name of the Owner Trustee by filing or causing to be filed with the FAA: (i)
the FAA Bills of Sale; (ii) applications for registration of the Aircraft and
Airframe N608FF in the name of the Owner Trustee (including without limitation
an affidavit from the Owner Trustee in compliance with the provisions of 14
C.F.R. (S) 47.7(c)(2)(iii) (1979)); and (iii) this Trust Agreement; and
(g) execute and deliver all such other instruments, documents or
certificates and take all such other actions in accordance with the directions
of the Original Owner Participant, as the Original Owner Participant may deem
necessary or advisable in connection with the transactions contemplated hereby.
SECTION 3.02. Conditions Precedent. The rights and obligations of
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the Owner Trustee to take the actions required by Section 3.01 hereof with
respect to the Aircraft and Airframe N608FF shall be subject to the Original
Owner Participant having notified the Owner Trustee that the terms and
conditions of the Purchase Agreement, insofar as they relate to conditions
precedent to performance by the Owner Trustee of its
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obligations thereunder, shall have been either fulfilled to the satisfaction of
or waived by the Original Owner Participant.
ARTICLE IV
RECEIPT, DISTRIBUTION AND APPLICATION
OF INCOME FROM THE TRUST ESTATE
SECTION 4.01. Distribution of Payments. (a) Payments to Owner
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Trustee. The Owner Trustee will receive all amounts constituting part of the
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Trust Estate which are payable to the account of the Owner Trustee under the
Operative Documents including, without limitation, (i) all amounts payable by
the Lessee as Basic Rent or Supplemental Rent, or as the result of an Event of
Loss or an Event of Default under the Lease, (ii) all proceeds of the sale, re-
lease or other disposition of either Aircraft or Airframe N608FF upon the
termination, non-renewal or other expiration of the Lease, and (iii) all other
amounts payable to the Owner Trustee under this Trust Agreement and the other
Operative Documents, and shall forthwith distribute said amounts:
First, to payment to the Owner Trustee for any fees, expenses, costs
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or liabilities incurred for which the Owner Trustee is entitled to payment,
reimbursement or indemnity from the Owner Participant and for which the Owner
Trustee has not been paid or reimbursed from any other source; and
Second, to payment of the entire balance to the Owner Participant.
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(b) Multiple Owner Participants. If, as a result of a transfer by an
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Owner Participant under Section 8.01 of this Trust Agreement, there is more than
one Owner Participant hereunder, each such Owner Participant shall hold in
proportion to its respective beneficial interest in the Trust Estate, an
undivided beneficial interest in the entire Trust Estate and is entitled to
receive ratably with any other Owner Participant, payments distributable by the
Owner Trustee hereunder. No Owner Participant shall have legal title to the
Aircraft, Airframe N608FF or any other portion of the Trust Estate.
SECTION 4.02. Method of Payments. The Owner Trustee shall make
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distributions or cause distributions to be made to the Owner Participant
pursuant to this Article IV by transferring by wire transfer in immediately
available funds on the day received (or on the next succeeding Business Day if
the funds to be so distributed shall not have been received by the Owner Trustee
by 1:00 p.m., Salt Lake City time), the amount to be distributed to such account
or accounts of the Owner Participant as the Owner
4
[Trust Agreement]
Participant may designate from time to time in writing to the Owner Trustee;
provided, however, that the Owner Trustee shall use reasonable efforts to invest
overnight in federal funds all monies received by it at or later than 1:00 p.m.,
Salt Lake City time.
ARTICLE V
DUTIES OF THE OWNER TRUSTEE
SECTION 5.01. Notice of Event of Default. If the Owner Trustee shall
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have knowledge of a Default or an Event of Default, the Owner Trustee shall give
to the Owner Participant prompt telephonic or telex notice thereof followed by
prompt confirmation thereof by certified mail, postage prepaid. Subject to the
terms of Section 5.03 hereof, the Owner Trustee shall take such action or shall
refrain from taking such action, with respect to such Default, Event of Default,
or any other event as the Owner Trustee shall be directed in writing by the
Owner Participant. For all purposes of this Trust Agreement, the Lease and the
other Operative Documents, in the absence of actual knowledge by a responsible
officer of the Corporate Trust Department of the Owner Trustee in his or her
capacity as such, the Owner Trustee shall not be deemed to have knowledge of a
Default or an Event of Default unless notified in writing by the Owner
Participant or the Lessee.
SECTION 5.02. Action Upon Instructions. Subject to the terms of
------------------------
Sections 5.01 and 5.03 hereof, upon the written instructions at any time and
from time to time of the Owner Participant, the Owner Trustee will take such of
the following actions as may be specified in such instructions: (i) give such
notice or direction or exercise such right, remedy or power hereunder or under
any of the Operative Documents to which the Owner Trustee is a party or in
respect of all or any part of the Trust Estate, or take such other action, as
shall be specified in such instructions; (ii) take such action to preserve or
protect the Trust Estate (including the discharge of Liens) as may be specified
in such instructions; (iii) approve as satisfactory to it all matters required
by the terms of the Lease or the other Operative Documents to be satisfactory to
the Owner Trustee, it being understood that without written instructions of the
Owner Participant, the Owner Trustee shall not approve any such matter as
satisfactory to it; (iv) subject to the rights of the Lessee under the Operative
Documents, after the expiration or earlier termination of the Lease, retain,
lease or otherwise dispose of, or from time to time take such other action with
respect to, the Aircraft and Airframe N608FF on such terms as shall be
designated in such instructions; and (v) take or refrain from taking such other
action or actions as may be specified in such instructions.
5
[Trust Agreement]
SECTION 5.03. Indemnification. The Owner Trustee shall not be
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required to take any action under Section 5.01 (other than the giving of the
notices referred to therein) or 5.02 hereof if the Owner Trustee shall
reasonably believe such action is not adequately indemnified by the Owner
Participant under Section 7.01 hereof, unless the Owner Participant agrees to
furnish such additional indemnity as shall reasonably be required, in manner and
form satisfactory to the Owner Trustee and, in addition to the extent not
otherwise paid pursuant to the provisions of the Lease, to pay the reasonable
compensation of the Owner Trustee for the services performed or to be performed
by it pursuant to such direction and any reasonable fees and disbursements of
counsel or agents employed by the Owner Trustee in connection therewith. The
Owner Trustee shall not be required to take any action under Section 5.01 or
5.02 hereof if the Owner Trustee shall reasonably determine, or shall have been
advised by counsel, that such action is contrary to the terms of any of the
Operative Documents to which the Owner Trustee is a party, or is otherwise
contrary to law.
SECTION 5.04. No Duties Except as Specified in Trust Agreement or
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Instructions. The Owner Trustee shall not have any duty or obligation to
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manage, control, use, sell, dispose of or otherwise deal with the Aircraft or
Airframe N608FF or any other part of the Trust Estate, or to otherwise take or
refrain from taking any action under, or in connection with any of the Operative
Documents to which the Owner Trustee is a party, except as expressly required by
the terms of any of the Operative Documents to which the Owner Trustee is a
party, or as expressly provided by the terms hereof or in a written instruction
from the Owner Participant received pursuant to the terms of Section 5.01 or
5.02, and no implied duties or obligations shall be read into this Trust
Agreement against the Owner Trustee. FSB agrees that it will, in its individual
capacity and at its own cost or expense (but without any right of indemnity in
respect of any such cost or expense under Section 7.01 hereof), promptly take
such action as may be necessary to duly discharge and satisfy in full all Lessor
Liens attributable to it in its individual capacity which it is required to
discharge pursuant to the Lease and otherwise comply with the terms of said
Section binding upon it.
SECTION 5.05. Satisfaction of Conditions Precedent. Anything herein to
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the contrary notwithstanding, the Owner Trustee shall comply with the provisions
of Section 3.01 hereof (subject to the satisfaction of special counsel for the
Owner Trustee of the occurrence of all the applicable conditions precedent
specified in Section 3.02 hereof).
SECTION 5.06. No Action Except Under Specified Documents or
---------------------------------------------
Instruction. The Owner Trustee agrees that it will not manage, control, use,
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sell, dispose of or otherwise deal with the Aircraft or Airframe N608FF or any
other part of the Trust
6
[Trust Agreement]
Estate except (i) as expressly required by the terms of any of the Operative
Documents to which the Owner Trustee is a party, (ii) as expressly provided by
the terms hereof, or (iii) as expressly provided in written instructions from
the Owner Participant pursuant to Section 5.01 or 5.02 hereof.
ARTICLE VI
THE OWNER TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties. FSB accepts the
-------------------------------
trusts hereby created and agrees to perform the same but only upon the terms
hereof applicable to it. The Owner Trustee also agrees to receive and disburse
all monies received by it constituting part of the Trust Estate upon the terms
hereof. FSB shall not be answerable or accountable under any circumstances,
except (a) for its own willful misconduct or gross negligence, (b) its failure
(in its individual capacity) to perform its obligations under the last sentence
of Section 5.04 hereof and the first sentence of Section 5.01 hereof, (c) for
its or the Owner Trustee's failure to use ordinary care to disburse funds or to
comply with the first sentence of Section 6.08 hereof and (d) for liabilities
that may result from the inaccuracy of any representation or warranty of it in
its individual capacity (or from the failure by it in its individual capacity to
perform any covenant) in Section 6.03 hereof or in Section 4 of the Lease or
elsewhere in any of the Operative Agreements.
SECTION 6.02. Absence of Certain Duties. Except in accordance with
-------------------------
written instructions furnished pursuant to Section 5.02 hereof and except as
provided in, and without limiting the generality of, Sections 3.01 and 5.04
hereof and the last sentence of Section 9.01(b) hereof, neither the Owner
Trustee nor FSB shall have any duty (i) to see to any recording or filing of any
Operative Document or of any supplement to any thereof or to see to the
maintenance of any such recording or filing or any other filing of reports with
the Federal Aviation Administration or other governmental agencies, except that
FSB in its individual capacity agrees to comply with the Federal Aviation
Administration reporting requirements set forth in 14 CFR (S) 47.45 and 14 CFR
(S) 47.51, and the Owner Trustee shall, to the extent that information for that
purpose is timely supplied by Lessee pursuant to any of the Operative Documents,
complete and timely submit (and furnish the Owner Participant with a copy of)
any and all reports relating to the Aircraft and Airframe N608FF which may from
time to time be required by the Federal Aviation Administration or any
government or governmental authority having jurisdiction, (ii) to see to any
insurance on the Aircraft and Airframe N608FF or to effect or maintain any such
insurance, whether or not Lessee shall be in default with respect thereto, other
than to forward to the Owner Participant copies of all reports and other written
information which the Owner
7
[Trust Agreement]
Trustee receives from Lessee pursuant to Section 11 of the Lease, (iii) to see
to the payment or discharge of any tax, assessment or other governmental charge
or any lien or encumbrance of any kind owing with respect to, assessed or levied
against any part of the Trust Estate, or (iv) to inspect Lessee's books and
records with respect to the Aircraft and Airframe N608FF at any time permitted
pursuant to the Lease. Notwithstanding the foregoing, the Owner Trustee will
furnish to the Owner Participant, promptly upon receipt thereof, duplicates or
copies of all reports, notices, requests, demands, certificates, financial
statements and other instruments furnished to the Owner Trustee under the Lease
or any other Operative Document except to the extent to which a responsible
officer of the Owner Trustee reasonably believes (and confirms by telephone call
with the Owner Participant) that duplicates or copies thereof have already been
furnished to the Owner Participant by some other person.
SECTION 6.03. No Representations or Warranties as to Certain Matters.
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NEITHER THE OWNER TRUSTEE NOR FSB MAKES OR SHALL BE DEEMED TO HAVE MADE (a) ANY
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS,
VALUE, CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR USE FOR A
PARTICULAR PURPOSE OF EITHER AIRCRAFT OR AIRFRAME N608FF OR ANY PART THEREOF, AS
TO THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, OR ANY
OTHER REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO EITHER
AIRCRAFT OR AIRFRAME N608FF OR ANY PART THEREOF WHATSOEVER, except that FSB in
its individual capacity warrants that on the Delivery Date the Owner Trustee
shall have received whatever title was conveyed to it by Tower and that the
Aircraft and Airframe N608FF shall during the Term be free of Lessor Liens
attributable to FSB in its individual capacity, or (b) any representation or
warranty as to the validity, legality or enforceability of this Trust Agreement
or any Operative Document to which the Owner Trustee is a party, or any other
document or instrument, or as to the correctness of any statement contained in
any thereof except to the extent that any such statement is expressly made
herein or therein by such party as a representation by the Owner Trustee or by
FSB in its individual capacity, as the case may be, and except that FSB in its
individual capacity hereby represents and warrants that this Trust Agreement has
been, and (assuming due authorization, execution and delivery by the Original
Owner Participant of this Trust Agreement) the Operative Documents to which it
or the Owner Trustee is a party have been (or at the time of execution and
delivery of any such instrument by it or the Owner Trustee hereunder that such
an instrument will be) duly executed and delivered by one of its officers who is
or will be, as the case may be, duly authorized to execute and deliver such
instruments on behalf of itself or the Owner Trustee, as the case may be, and
that the Trust Agreement constitutes the legal, valid and binding obligation of
FSB or the Owner Trustee, as the case may be,
8
[Trust Agreement]
enforceable against FSB or the Owner Trustee, as the case may be, in accordance
with its terms.
SECTION 6.04. No Segregation of Monies; Interest. Monies received by
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the Owner Trustee hereunder need not be segregated in any manner except to the
extent provided by law, and shall be invested as provided in Section 4.02
hereof.
SECTION 6.05. Reliance Upon Certificates, Counsel and Agents. The
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Owner Trustee shall incur no liability to anyone in acting in good faith in
reliance upon and in accordance with any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document or paper reasonably believed by it to be genuine and reasonably
believed by it to be signed by the proper party or parties. Unless other
evidence in respect thereof is specifically prescribed herein, any request,
direction, order or demand of the Owner Participant or Lessee mentioned herein
or in any of the Operative Documents to which the Owner Trustee is a party shall
be sufficiently evidenced by written instruments signed by a person purporting
to be the Chairman of the Board, the President, any Vice President or any other
officer and in the name of the Owner Participant or Lessee, as the case may be.
The Owner Trustee may accept a copy of a resolution of the Board of Directors or
Executive Committee of Lessee, certified by the Secretary or an Assistant
Secretary of Lessee as duly adopted and in full force and effect, as conclusive
evidence that such resolution has been duly adopted by said Board or Committee
and that the same is in full force and effect. As to any fact or matter the
manner of ascertainment of which is not specifically described herein, the Owner
Trustee may for all purposes hereof rely on a certificate signed by a person
purporting to be the Chairman of the Board, the President, any Vice President or
any other officer of Lessee, as to such fact or matter, and such certificate
shall constitute full protection to the Owner Trustee for any action taken or
omitted to be taken by it in good faith in reliance thereon and in accordance
therewith. In the administration of trusts hereunder, the Owner Trustee may
execute any of the trusts or powers hereof and perform its powers and duties
hereunder directly or through agents or attorneys and may, at the expense of the
Trust Estate, consult with counsel, accountants and other skilled persons to be
selected and employed by it. The Owner Trustee shall not be liable for anything
done, suffered or omitted in good faith by it in accordance with the advice or
opinion of any such counsel, accountants or other skilled persons and the Owner
Trustee shall not be liable for the negligence of any such counsel, accountant
or other skilled person appointed by it with due care hereunder.
SECTION 6.06. Not Acting in Individual Capacity. In acting
---------------------------------
hereunder, the Owner Trustee acts solely as trustee and not in its individual
capacity except as otherwise expressly provided herein; and, except as may be
otherwise expressly provided in this Trust Agreement or in the Lease, all
persons having any claim against the Owner Trustee by
9
[Trust Agreement]
reason of the transactions contemplated hereby shall look only to the Trust
Estate for payment or satisfaction thereof except to the extent the Owner
Trustee shall expressly agree otherwise in writing.
SECTION 6.07. Fees; Compensation. The Owner Trustee shall be
------------------
entitled to receive compensation, reasonable as regards its responsibilities
hereunder, together with reimbursement within thirty (30) days of its request
for all reasonable expenses incurred or made by it in accordance with any of the
provisions of this Trust Agreement or any other Operative Document (including
the reasonable compensation and the expenses of its counsel, accountants or
other skilled persons and of all other persons not regularly in its employ). If
an Event of Default shall occur and be continuing or if the Lease is declared to
be in default, the Owner Trustee shall be entitled to receive compensation,
reasonable as regards its additional responsibilities hereunder, and payment or
reimbursement for its expenses as provided above. The Owner Participant shall
be required to pay the fees of the Owner Trustee comprising the compensation and
reimbursement of expenses to which the Owner Trustee is entitled under this
Section 6.07, provided that the Owner Trustee shall have a Lien upon the Trust
Estate for any such fee not paid by the Owner Participant as contemplated by
this Section 6.07 and such Lien shall entitle the Owner Trustee to priority as
to payment thereof over payment to any other Person under this Trust Agreement.
SECTION 6.08. Tax Returns. The Owner Trustee shall be responsible
-----------
for the keeping of all appropriate books and records relating to the receipt and
disbursement of all monies under this Trust Agreement or any agreement
contemplated hereby. The Owner Participant shall be responsible for causing to
be prepared and filed all income tax returns required to be filed by the Owner
Participant. The Owner Trustee shall be responsible for causing to be prepared,
at the request and expense of the Owner Participant, all income tax returns
required to be filed with respect to the trust created hereby and shall execute
and file such returns. Owner Participant, upon request, will furnish the Owner
Trustee with all such information as may be reasonably required from the Owner
Participant in connection with the preparation of such income tax returns.
ARTICLE VII
INDEMNIFICATION OF FIRST SECURITY BANK
BY OWNER PARTICIPANT
SECTION 7.01. Owner Participant to Indemnify First Security Bank.
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The Owner Participant hereby agrees, whether or not any of the transactions
contemplated hereby shall be consummated, to assume liability for, and hereby
indemnifies, protects,
10
[Trust Agreement]
saves and keeps harmless FSB in its individual capacity and its successors,
assigns, legal representatives, agents and servants, from and against any and
all liabilities, obligations, losses, damages, penalties, taxes (excluding any
taxes payable by FSB in its individual capacity on or measured by any
compensation received by FSB in its individual capacity for its services
hereunder), claims, actions, suits, costs, expenses or disbursements (including,
without limitation, reasonable legal fees and expenses, and including without
limitation any liability of an owner, any strict liability and any liability
without fault) of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against FSB in its individual capacity in any way
relating to or arising out of this Trust Agreement or any of the Operative
Documents or the enforcement of any of the terms of any thereof, or in any way
relating to or arising out of the manufacture, purchase, acceptance,
nonacceptance, rejection, ownership, delivery, lease, possession, use,
operation, condition, sale, return or other disposition of either Aircraft or
Airframe N608FF or any part thereof (including, without limitation, latent and
other defects, whether or not discoverable, and any claim for patent, trademark
or copyright infringement), or in any way relating to or arising out of the
administration of the Trust Estate or the action or inaction of the Owner
Trustee or FSB in its individual capacity hereunder, except (a) in the case of
willful misconduct or gross negligence on the part of the Owner Trustee or FSB
in its individual capacity in the performance or nonperformance of its duties
hereunder or under any of the other Operative Documents to which the Owner
Trustee is a party or (b) those resulting from the inaccuracy of any
representation or warranty of FSB in its individual capacity (or from the
failure of FSB in its individual capacity to perform any of its covenants) in
Section 6.03 hereof and in the Lease, or elsewhere in any of the Operative
Documents or (c) as may result from a breach by FSB in its individual capacity
of its covenant in the last sentence of Section 5.04 hereof or (d) in the case
of the failure to use ordinary care on the part of the Owner Trustee or FSB in
its individual capacity in the disbursement of funds or in compliance with the
provisions of the first sentence of Section 6.08 hereof or (e) Expenses (as
defined in Section 16(c)(i) of the Lease) arising under any circumstances or
upon any terms where Lessee would not have been required to indemnify the Owner
Trustee in its individual capacity pursuant to the Lease (disregarding for
purposes of this Section 7.01, the penultimate sentence of Section 16(c)(i) of
the Lease). The indemnities contained in this Section 7.01 extend to FSB only
in its individual capacity and shall not be construed as indemnities of the
Trust Estate (except to the extent, if any, that FSB in its individual capacity
has been reimbursed by the Trust Estate for amounts covered by the indemnities
contained in this Section 7.01). The indemnities contained in this Section 7.01
shall survive the termination of this Trust Agreement.
11
[Trust Agreement]
ARTICLE VIII
TRANSFER OF THE OWNER PARTICIPANT'S INTEREST
SECTION 8.01. Transfer of Interests. If there is more than one Owner
---------------------
Participant, no assignment, conveyance or other transfer by an Owner Participant
of any of its right, title or interest in and to this Trust Agreement or the
Trust Estate shall be valid unless each other Owner Participant's prior written
consent (which consent may be withheld in the sole discretion of such other
Owner Participants) is given to such assignment, conveyance or other transfer.
SECTION 8.02. Actions of the Owner Participants. If at any time
---------------------------------
prior to the termination of this Trust Agreement there is more than one Owner
Participant, then, subject to Section 11.05 hereof, during such time, if any
action is required to be taken by all Owner Participants and whenever any
direction, authorization, approval, consent, instruction, or other action is
permitted to be given or taken by the Owner Participant it shall be given or
taken only upon unanimous agreement of all Owner Participants; provided,
however, that the termination of this Trust Agreement pursuant to Section 11.01
hereof may be effected upon the election of any Owner Participant.
ARTICLE IX
SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES
SECTION 9.01. Resignation of Owner Trustee; Appointment of Successor.
------------------------------------------------------
(a) Resignation or Removal. The Owner Trustee or any successor Owner
----------------------
Trustee may resign at any time without cause by giving at least 60 days' prior
written notice to the Owner Participant, such resignation to be effective upon
the acceptance of appointment by the successor Owner Trustee under Section
9.01(b) hereof. In addition, the Owner Participant may at any time remove the
Owner Trustee with cause by a notice in writing delivered to the Owner Trustee
and Lessee, such removal to be effective upon the acceptance of appointment by
the successor Owner Trustee under Section 9.01(b) hereof. In the case of the
resignation or removal of the Owner Trustee, the Owner Participant may appoint a
successor Owner Trustee by an instrument signed by the Owner Participant. If a
successor Owner Trustee shall not have been appointed within 30 days after such
notice of resignation or removal, the Owner Trustee may apply to any court of
competent jurisdiction to appoint a successor Owner Trustee to act until such
time, if any, as a successor shall have been appointed as above provided. Any
successor Owner Trustee so appointed by
12
[Trust Agreement]
such court shall immediately and without further act be superseded by any
successor Owner Trustee appointed as above provided.
(b) Execution and Delivery of Documents, etc. Any successor Owner
----------------------------------------
Trustee, however appointed, shall execute and deliver to the predecessor Owner
Trustee an instrument accepting such appointment, and thereupon such successor
Owner Trustee, without further act, shall become vested with all the estates,
properties, rights, powers, duties and trusts of the predecessor Owner Trustee
in the trusts hereunder with like effect as if originally named the Owner
Trustee herein; but nevertheless, upon the written request of such successor
Owner Trustee, such predecessor Owner Trustee shall execute and deliver an
instrument transferring to such successor Owner Trustee, upon the trusts herein
expressed, all the estates, properties, rights, powers and trusts of such
predecessor Owner Trustee, and such predecessor Owner Trustee shall duly assign,
transfer, deliver and pay over to such successor Owner Trustee all monies or
other property then held by such predecessor Owner Trustee upon the trusts
herein expressed. Upon the appointment of any successor Owner Trustee
hereunder, the predecessor Owner Trustee will execute such documents as are
provided to it by such successor Owner Trustee and will take such further
actions as are requested of it by such successor Owner Trustee as are reasonably
required to cause registration of the Aircraft included in the Trust Estate to
be transferred upon the records of the Federal Aviation Administration, or other
governmental authority having jurisdiction, into the name of the successor Owner
Trustee.
(c) Qualifications. Any successor Owner Trustee, however appointed,
--------------
shall be a "citizen of the United States" within the meaning of 49 U.S.C. (S)
40102(a)(15) and shall also be a bank or trust company organized under the laws
of the United States or any state thereof having a combined capital and surplus
of at least $50,000,000, if there be such an institution willing, able and
legally qualified to perform the duties of the Owner Trustee hereunder upon
reasonable or customary terms. No such successor trustee shall charge fees for
its services as an Owner Trustee in excess of the then prevailing market rates
for such services.
(d) Merger, etc. Any corporation into which FSB may be merged or
-----------
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which FSB shall be a party, or
any corporation to which substantially all the corporate trust business of FSB
may be transferred, shall, subject to the terms of Section 9.01(c) hereof, be
the Owner Trustee hereunder without further act.
SECTION 9.02. Co-Trustees and Separate Trustees. If at any time it
---------------------------------
shall be necessary or prudent in order to conform to any law of any jurisdiction
in which all or any part of the Trust Estate is located, or the Owner Trustee
being advised by counsel shall
13
[Trust Agreement]
determine that it is so necessary or prudent in the interest of the Owner
Participant or the Owner Trustee, or the Owner Trustee shall have been directed
to do so by the Owner Participant, the Owner Trustee and the Owner Participant
shall execute and deliver an agreement supplemental hereto and all other
instruments and agreements necessary or proper to constitute another bank or
trust company or one or more persons (any and all of which shall be a "citizen
of the United States" as defined in 49 U.S.C. (S) 40102(a)(15)) approved by the
Owner Trustee and the Owner Participant, either to act as co-trustee, jointly
with the Owner Trustee, or to act as separate trustee hereunder (any such co-
trustee or separate trustee being herein sometimes referred to as an "additional
trustee"). In the event the Owner Participant shall not have joined in the
execution of such agreements supplemental hereto within ten days after the
receipt of a written request from the Owner Trustee so to do, or in case an
Event of Default shall occur and be continuing, the Owner Trustee may act under
the foregoing provisions of this Section 9.02 without the concurrence of the
Owner Participant; and the Owner Participant hereby appoints the Owner Trustee
its agent and attorney-in-fact to act for it under the foregoing provisions of
this Section 9.02 in either of such contingencies.
Every additional trustee hereunder shall, to the extent permitted by
law, be appointed and act, and the Owner Trustee and its successors shall act,
subject to the following provisions and conditions:
(A) All powers, duties, obligations and rights conferred upon the
Owner Trustee in respect of the custody, control and management of monies,
the Aircraft, Airframe N608FF or documents authorized to be delivered
hereunder shall be exercised solely by the Owner Trustee;
(B) All other rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred or imposed upon and
exercised or performed by the Owner Trustee and such additional trustee
jointly, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed (including the holding
of title to the Trust Estate) the Owner Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations shall be exercised and performed by such
additional trustee;
(C) No power given to, or which it is provided hereby may be
exercised by, any such additional trustee shall be exercised hereunder by
such additional trustee, except jointly with, or with the consent in
writing of, the Owner Trustee;
14
[Trust Agreement]
(D) No trustee hereunder shall be personally liable by reason of any
action or omission of any other trustee hereunder; and
(E) The Owner Participant, at any time, by an instrument in writing
may remove any such additional trustee. In the event that the Owner
Participant shall not have joined in the execution of any such instrument
within ten days after the receipt of a written request from the Owner
Trustee so to do, the Owner Trustee shall have the power to remove any such
additional trustee without the concurrence of the Owner Participant; and
the Owner Participant hereby appoints the Owner Trustee its agent and
attorney-in-fact for it in such connection in such contingency.
ARTICLE X
SUPPLEMENTS AND AMENDMENTS
TO TRUST AGREEMENT AND OTHER DOCUMENTS
SECTION 10.01. Supplements and Amendments and Delivery Thereof.
-----------------------------------------------
(a) Supplements and Amendments. This Trust Agreement may not be
--------------------------
amended, supplemented or otherwise modified except by an instrument in writing
signed by the Owner Trustee and the Owner Participant. Subject to Section 10.02
hereof, the Owner Trustee will execute any amendment, supplement or other
modification of this Trust Agreement or of any other Operative Documents to
which the Owner Trustee is a party which it is requested to execute by the Owner
Participant, except that the Owner Trustee shall not execute any such amendment,
supplement or other modification which, by the express provisions of any of the
above documents, requires the consent of any other party unless such consent
shall have been obtained.
(b) Delivery of Amendments and Supplements to Certain Parties. A
---------------------------------------------------------
signed copy of each amendment or supplement referred to in Section 10.01(a)
hereof to which Lessee is not a party shall be delivered promptly by the Owner
Trustee to the Lessee.
SECTION 10.02. Discretion as to Execution of Documents. Prior to
---------------------------------------
executing any document required to be executed by it pursuant to the terms of
Section 10.01 hereof, the Owner Trustee shall be entitled to receive an opinion
of its counsel to the effect that the execution of such document is authorized
hereunder. If in the opinion of the Owner Trustee any such document adversely
affects any right, duty, immunity or indemnity in favor of the Owner Trustee
hereunder or under any other Operative Document to which
15
[Trust Agreement]
the Owner Trustee is a party, the Owner Trustee may in its discretion decline to
execute such document.
SECTION 10.03. Absence of Requirements as to Form. It shall not be
----------------------------------
necessary for any written request furnished pursuant to Section 10.01 hereof to
specify the particular form of the proposed documents to be executed pursuant to
such Section, but it shall be sufficient if such request shall indicate the
substance thereof.
SECTION 10.04. Distribution of Documents. Promptly after the
-------------------------
execution by the Owner Trustee of any document entered into pursuant to Section
10.01 hereof, the Owner Trustee shall mail, by certified mail, postage prepaid,
a conformed copy thereof to the Owner Participant, but the failure of the Owner
Trustee to mail such conformed copy shall not impair or affect the validity of
such document.
SECTION 10.05. No Request Needed as to Lease Supplement and Trust
--------------------------------------------------
Supplement. No written request pursuant to Section 10.01 hereof shall be
----------
required to enable the Owner Trustee to enter into the Lease Supplement covering
either Aircraft or Airframe N608FF with Lessee pursuant to the terms of the
Lease and Section 3.01 hereof and the Trust Supplement pursuant to the terms of
Section 3.01 hereof.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Termination of Trust Agreement. This Trust Agreement
------------------------------
and the trusts created hereby shall be of no further force or effect upon the
earlier of (a) the sale or other final disposition by the Owner Trustee of all
property constituting part of the Trust Estate and the final distribution by the
Owner Trustee of all monies or other property or proceeds constituting part of
the Trust Estate in accordance with Article IV hereof, provided that at such
time Lessee shall have fully complied with all of the terms of the Lease, or (b)
twenty-one years less one day after the death of the last survivor of all of the
descendants of the grandparents of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ living on the date of
the earliest execution of this Trust Agreement by any party hereto, but if this
Trust Agreement and the trusts created hereby shall be or become authorized
under applicable law to be valid for a period commencing on the 21st anniversary
of the death of such last survivor (or, without limiting the generality of the
foregoing, if legislation shall become effective providing for the validity of
this Trust Agreement and the trusts created hereby for a period in gross
exceeding the period for which this Trust Agreement and the trusts created
hereby are hereinabove stated to extend and be valid), then this Trust Agreement
and the trusts created
16
[Trust Agreement]
hereby shall not terminate under this subsection (b) but shall extend to and
continue in effect, but only if such non-termination and extension shall then be
valid under applicable law, until the day preceding such date as the same shall,
under applicable law, cease to be valid; otherwise this Trust Agreement and the
trusts created hereby shall continue in full force and effect in accordance with
the term hereof. Except as expressly set forth in this Section 11.01, this
Trust Agreement and the trusts created hereby may not be revoked by the Owner
Participant.
SECTION 11.02. Owner Participant Has No Legal Title in Trust Estate.
----------------------------------------------------
No Owner Participant shall have legal title to any part of the Trust Estate. No
transfer, by operation of law or otherwise, of any right, title and interest of
the Owner Participant in and to the Trust Estate hereunder shall operate to
terminate this Trust Agreement or the trusts hereunder or entitle any successors
or transferees of the Owner Participant to an accounting or to the transfer of
legal title to any part of the Trust Estate.
SECTION 11.03. Assignment, Sale, etc. of Aircraft and Airframe
-----------------------------------------------
N608FF. Any assignment, sale, transfer or other conveyance of either Aircraft or
Airframe N608FF or any part thereof by the Owner Trustee made pursuant to the
terms hereof or of the Lease shall bind the Owner Participant and shall be
effective to transfer or convey all right, title and interest of the Owner
Trustee and the Owner Participant in and to either Aircraft, Airframe N608FF or
such part so assigned, sold, transferred or conveyed. No purchaser or other
grantee shall be required to inquire as to the authorization, necessity,
expediency or regularity of such assignment, sale, transfer or conveyance or as
to the application of any sale or other proceeds with respect thereto by the
Owner Trustee.
SECTION 11.04. Trust Agreement for Benefit of Certain Parties Only.
---------------------------------------------------
Except for the terms of Article VIII hereof and except as otherwise provided in
Article IX and Sections 5.01, 6.07, 10.01 and 11.01 hereof, nothing herein,
whether expressed or implied, shall be construed to give any person other than
the Owner Trustee and the Owner Participant any legal or equitable right, remedy
or claim under or in respect of this Trust Agreement; but this Trust Agreement
shall be held to be for the sole and exclusive benefit of the Owner Trustee and
the Owner Participant.
SECTION 11.05. Citizenship of the Owner Participant. If at any time
------------------------------------
there shall be more than one Owner Participant, then any Owner Participant who
shall cease to be a "citizen of the United States" as defined in 49 U.S.C. (S)
40102(a)(15) shall have no voting or similar rights hereunder and shall have no
right to direct, influence or limit the exercise of, or to prevent the direction
or influence of, or place any limitation on the exercise of, the Owner Trustee's
authority or to remove the Owner Trustee.
17
[Trust Agreement]
SECTION 11.06. Notices. All notices, demands, instructions and other
-------
communications required or permitted to be given to or made upon any party
hereto shall be in writing and shall be personally delivered or sent by
registered or certified mail, postage prepaid, or by facsimile, or by prepaid
courier service, and shall be deemed to be given for purposes of this Agreement
on the day that such writing is delivered or, if sent by registered or certified
mail, three Business Days after being deposited in the mails addressed to the
intended recipient thereof in accordance with the provisions of this Section
11.06. Unless otherwise specified in a notice sent or delivered in accordance
with the foregoing provisions of this Section 11.06, notices, demands,
instructions and other communications in writing shall be given to or made upon
the respective parties hereto at their respective addresses (or to their
respective facsimile numbers) as follows: (A) if to Lessee, the Owner Trustee or
the Original Owner Participant, to the respective addresses set forth in the
Lease, or (B) if to a Subsequent Owner Participant, addressed to such Subsequent
Owner Participant at such address as such Subsequent Owner Participant shall
have furnished by notice to the parties hereto.
SECTION 11.07. Severability. Subject to Sections 11.06 and 11.12
------------
hereof, any provision hereof which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 11.08. Waivers, etc. No term or provision hereof may be
-------------
changed, waived, discharged or terminated orally, but only by an instrument in
writing entered into in compliance with the terms of Article X hereof; and any
waiver of the terms hereof shall be effective only in the specific instance and
for the specific purpose given.
SECTION 11.09. Counterparts. This Trust Agreement may be executed by
------------
the parties hereto 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.
SECTION 11.10. Binding Effect, etc. All covenants and agreements
--------------------
contained herein shall be binding upon, and inure to the benefit of, the Owner
Trustee and its successors and assigns, and the Original Owner Participant, its
successors and, to the extent permitted by Article VIII hereof, its assigns.
Any request, notice, direction, consent, waiver or other instrument or action by
an Owner Participant shall bind its successors and assigns.
18
[Trust Agreement]
SECTION 11.11. Headings; References. The headings of the various
--------------------
Articles and Sections herein are for convenience of reference only and shall not
define or limit any of the terms or provisions hereof.
SECTION 11.12. Governing Law. THIS TRUST AGREEMENT SHALL IN ALL
-------------
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF UTAH, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE.
ARTICLE XII
CERTAIN LIMITATIONS
SECTION 12.01. Limitations on Control. Notwithstanding any other
----------------------
provision of this Trust Agreement, but subject to the other provisions of this
Article XII, from and after the Delivery Date and until termination of this
Trust Agreement, (i) the Owner Participant shall not, except as otherwise
provided in the second sentence of Section 5.01, have any voting rights or other
rights to direct the Owner Trustee in connection with matters involving the
ownership and operation of either Aircraft, Airframe N608FF or any part thereof
by the Owner Trustee (collectively, "Control Rights"), and (ii) the Owner
--------------
Trustee shall have absolute and complete discretion in all matters as to which
the Owner Participant otherwise would have had any Control Rights, but for the
provisions of this Article XII. Such discretion (x) is in addition to the
discretion given to the Owner Trustee under the other Sections of this Trust
Agreement, and (y) is expressly limited to the Control Rights that, but for the
provisions of this Article XII, would be held or exercisable by the Owner
Participant, and does not extend to any other rights, powers or privileges in
respect of the beneficial interest of the Owner Participant in the Trust Estate.
SECTION 12.02. Discretion and Actions of Owner Trustee.
---------------------------------------
(a) In exercising its discretion under this Article XII, the Owner
Trustee shall exercise its best judgment and shall not be liable for any action
taken or omitted hereunder, except for its gross negligence or willful
misconduct, and shall exercise the Control Rights in connection with all matters
involving the ownership and operation of the Aircraft and Airframe N608FF by the
Owner Trustee. The Owner Trustee shall not be required, and shall have no
power, duty or obligation, to exercise Control Rights in respect of any other
matters.
(b) Notwithstanding any other provisions hereof, in exercising any
Control Rights pursuant to this Article XII in connection with all matters
involving the
19
[Trust Agreement]
ownership or operation of the Aircraft and Airframe N608FF by the Owner Trustee,
the Owner Trustee shall be free of any kind of control by the Owner Participant
and shall exercise the Control Rights as it in its discretion shall deem
necessary to protect the interests of the United States, notwithstanding any
countervailing interests of any foreign power which may, or whose citizens may,
have a direct or indirect interest in the Owner Participant and any such action
by the Owner Trustee shall not be considered malfeasance or in breach of any
obligation which the Owner Trustee might otherwise have to the Owner
Participant, provided, however, that subject to the foregoing limitations, the
-------- -------
Owner Trustee shall exercise its discretion in all matters involving the
ownership and operation of the Aircraft and Airframe N608FF by the Owner Trustee
with due regard for the interests of the Owner Participant. The Owner Trustee,
promptly after each exercise of any Control Rights hereunder, shall notify the
Owner Participant of the exercise thereof.
(c) The Owner Trustee agrees that it shall not without the prior
written consent of the Owner Participant (i) dissolve or amend the Trust
Agreement, (ii) sell, mortgage, pledge or otherwise dispose of all or any part
of the Trust Estate, including the Aircraft, Airframe N608FF and the Lease,
(iii) transfer any portion of the Owner Participant's beneficial interest in the
Trust Estate to any other person, or (iv) amend or modify the Lease or any other
Operative Agreement, or grant any waivers of any terms thereof or give any
consents thereunder.
SECTION 12.03. Payments. Notwithstanding any other provision of this
--------
Article XII, the Owner Participant shall be entitled to receive from the Owner
Trustee or otherwise all rent, payments or insurance proceeds and other payments
of whatsoever kind and nature payable to the Owner Participant pursuant to this
Trust Agreement or any other Operative Agreement in the same manner as if the
Control Rights had not been transferred to the Owner Trustee and held in trust
hereunder.
SECTION 12.04. Owner Trustee Acts as Trustee. Notwithstanding any
-----------------------------
other provision of this Trust Agreement, in exercising any Control Rights
pursuant to this Article XII, the Owner Trustee acts solely as trustee and not
in its individual capacity, and except as may be otherwise expressly provided in
Section 12.02 hereof, all persons having any claim against the Owner Trustee in
its individual capacity or as the Owner Trustee by reason of the transactions
contemplated by this Article XII shall not have any recourse to the Owner
Trustee in its individual capacity.
SECTION 12.05. Termination. The provisions of this Article XII shall
-----------
terminate upon the earliest of (i) the Aircraft ceasing to be registered under
the laws of the United States, or (ii) the Owner Participant becoming a citizen
of the United States, as defined in 49 U.S.C. (S) 40102(a)(15) as in effect on
the date hereof or on any subsequent
20
[Trust Agreement]
date (a "U.S. Citizen"), or (iii) the termination of this Trust Agreement
pursuant to the provisions of Section 11.01 hereof.
SECTION 12.06. Amendments to Article XII. Notwithstanding any other
-------------------------
provision of this Trust Agreement, so long as the Aircraft and Airframe N608FF
shall be registered under the laws of the United States and so long as this
Article XII shall not have been terminated pursuant to Section 12.05 hereof,
this Article XII shall not be amended, supplemented or modified unless either
(i) the Owner Participant shall have become a U.S. Citizen, or (ii) the FAA
shall have concluded that such amendment, supplement or modification would not
cause the Aircraft or Airframe N608FF to be ineligible for registration in the
United States.
SECTION 12.07. Purpose. The purpose of this Article XII is to give
-------
the Owner Trustee the power to manage and control the Aircraft and Airframe
N608FF with respect to matters involving the ownership and operation of the
Aircraft and Airframe N608FF by the Owner Trustee so as to assure that the
Aircraft and Airframe N608FF shall be controlled with respect to such matters by
a U.S. Citizen, and that the Owner Trustee shall be able to give the affidavit
required by Section 47.7(c)(2)(iii) of the FAR, 14 C.F.R. (S) 47.7(c)(2)(iii).
This Article XII shall be construed in furtherance of, and the powers given to
the Owner Trustee thereby shall be construed no more broadly than is required
by, such purpose.
* * *
21
[Trust Agreement]
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
SANWA BUSINESS CREDIT CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Title: Senior Credit Officer
--------------------------------
FIRST SECURITY BANK, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Title: Vice President
--------------------------------
22
TRUST AGREEMENT SUPPLEMENT
This TRUST AGREEMENT SUPPLEMENT, dated October 11, 1996 (herein called the
"Trust Supplement") of FIRST SECURITY BANK, NATIONAL ASSOCIATION, not in its
individual capacity, but solely as Owner Trustee (herein called the "Owner
Trustee"), under the Trust Agreement, dated as of October 1, 1996 (the "Trust
Agreement"), between the Owner Trustee and the Owner Participant named therein.
WITNESSETH:
WHEREAS, the Trust Agreement provides for the execution and delivery of one
or more supplements thereto substantially in the form hereof, which shall
particularly describe the Aircraft and Airframe N608FF (such term and other
terms defined in the Trust Agreement used herein as therein defined) included in
the property covered by the Trust Agreement;
WHEREAS, the Trust Agreement relates to Airframes and Engines described
below, and a counterpart of the Trust Agreement is attached hereto and made a
part hereof and this Trust Supplement is being filed on the date hereof with the
Federal Aviation Administration as one document:
AIRFRAME
Three Airframe Identified as follows:
FAA
Registration Manufacturer's
Manufacturer Model Number Serial Number
------------ ----- ------ -------------
The Boeing Company 747-282B N610FF 20501
The Boeing Company 747-282B N611FF 20502
The Boeing Company 747-131 N608FF 19672
together with all Parts of whatever nature, which are from time to time
incorporated or installed in or attached to said aircraft.
AIRCRAFT ENGINES
Eight aircraft engines, each such engine having 750 or more rated
take-off horsepower or the equivalent thereof, identified as follows:
Manufacturer's
Manufacturer Model Serial Number
------------ ----- --------------
▇▇▇▇▇ & ▇▇▇▇▇▇▇ JT9D-7A 685648
▇▇▇▇▇ & Whitney JT9D-7A 686063
▇▇▇▇▇ & ▇▇▇▇▇▇▇ JT9D-7A 663074
▇▇▇▇▇ & Whitney JT9D-7A 662750
▇▇▇▇▇ & ▇▇▇▇▇▇▇ JT9D-7A 685769
▇▇▇▇▇ & Whitney JT9D-7A 685773
▇▇▇▇▇ & ▇▇▇▇▇▇▇ JT9D-7A 685694
▇▇▇▇▇ & Whitney JT9D-7A 662359
together with all Parts of whatever nature, which are from time to time
incorporated or installed in or attached to such engines.
Together with (a) all substitutions, renewals and replacements of and
additions, improvements, accessions and accumulations to Airframe and Engines
(other than additions, improvements, accessions and accumulations which
constitute appliances, parts, instruments, appurtenances, accessories,
furnishings or other equipment excluded from the definition of Parts) and (b)
all logs, manuals and data and inspection, modification and overhaul records
maintained in respect of the Aircraft and Airframe N608FF, including the
Engines, including, without limitation, all such logs, manuals, data and records
required to be maintained by the FAA or by the applicable regulatory agency or
body of any other jurisdiction in which the Aircraft and Airframe N608FF may
then be registered in each case whether the Owner Trustee now has or shall
hereafter acquire an interest.
This Trust Supplement shall be construed as supplemental to the Trust
Agreement and shall form a part of each, and the Trust Agreement is hereby
incorporated by reference herein and each is hereby ratified, approved and
confirmed.
AND, FURTHER, the Owner Trustee hereby acknowledges that the delivered
Aircraft referred to in this Trust Supplement and the aforesaid Lease Supplement
has been delivered to the Owner Trustee and is included in the property of the
Owner Trustee covered by all the terms and conditions of the Trust Agreement.
* * *
IN WITNESS WHEREOF, the Owner Trustee has caused this Trust Supplement
to be duly executed by one of its officers, thereunto duly authorized, on the
day and year first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
Owner Trustee
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Title: Vice President