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EXHIBIT 4.38
FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1990 AWA-14]
Dated as of November 26, 1996
between
WILMINGTON TRUST COMPANY,
not in its individual capacity
except as expressly provided herein
but solely as Owner Trustee
and
FLEET NATIONAL BANK,
not in its individual capacity
except as expressly provided herein
but solely as Indenture Trustee
Secured Equipment Notes Covering
One Airbus A320-231 Aircraft
Manufacturer's Serial No. 092
Registration No. N635AW
Leased by America West Airlines, Inc.
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TABLE OF CONTENTS
Page
GRANTING CLAUSE................................................. 3
HABENDUM CLAUSE................................................. 6
ARTICLE I
DEFINITIONS
SECTION 1.01. Special Definitions.............................. 8
ARTICLE II
THE EQUIPMENT NOTES
SECTION 2.01. Form of Equipment Notes.......................... 21
SECTION 2.02. Issuance and Terms of Equipment Notes............ 26
SECTION 2.03. Payments from Trust Indenture Estate
Only.............................. 29
SECTION 2.04. Method of Payment................................ 31
SECTION 2.05. Application of Payments.......................... 33
SECTION 2.06. Termination of Interest in Trust
Indenture Estate.................. 34
SECTION 2.07. Registration, Transfer and Exchange of
Equipment Notes................... 34
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen
Equipment Notes................... 36
SECTION 2.09. Payment of Expenses on Transfer;
Cancellation...................... 36
SECTION 2.10. Mandatory Redemptions of Equipment
Notes............................. 37
SECTION 2.11. Redemptions; Notice of Redemption................ 37
SECTION 2.12. Option to Purchase Equipment Notes............... 38
SECTION 2.13. Subordination.................................... 39
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Certain Rent Distributions....................... 40
SECTION 3.02. Event of Loss and Replacement.................... 42
SECTION 3.03. Payment After Indenture Event of
Default, etc...................... 43
SECTION 3.04. Certain Payments................................. 46
SECTION 3.05. Other Payments................................... 47
SECTION 3.06. Payments to Owner Trustee........................ 47
SECTION 3.07. Investment of Amounts Held by Indenture
Trustee........................... 48
(i)
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Page
ARTICLE IV
COVENANTS OF TRUST COMPANY AND OWNER
TRUSTEE; INDENTURE EVENTS OF DEFAULT;
REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of Trust Company and Owner
Trustee.................................................................. 49
SECTION 4.02. Indenture Events of Default............................................................. 50
SECTION 4.03. Certain Rights.......................................................................... 53
SECTION 4.04. Remedies................................................................................ 55
SECTION 4.05. Return of the Aircraft, etc............................................................. 58
SECTION 4.06. Remedies Cumulative..................................................................... 60
SECTION 4.07. Discontinuance of Proceedings........................................................... 60
SECTION 4.08. Waiver of Past Indenture Defaults....................................................... 61
SECTION 4.09. Exercise of Remedies by Foreign Note
Holders.................................................................. 61
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Indenture Event of Default.................................................... 61
SECTION 5.02. Action Upon Instructions................................................................ 62
SECTION 5.03. Indemnification......................................................................... 63
SECTION 5.04. No Duties Except as Specified in
Indenture or Instructions................................................ 64
SECTION 5.05. No Action Except Under Lease, Refunding
Agreement, Indenture or Instructions..................................... 64
SECTION 5.06. Replacement Airframes, Replacement
Engines and Replacement Parts............................................ 65
SECTION 5.07. Indenture Supplements for Replacements.................................................. 68
SECTION 5.08. Effect of Replacement................................................................... 68
SECTION 5.09. Notices, etc............................................................................ 69
SECTION 5.10. Certain Rights of Owner Trustee and
Owner Participant........................................................ 69
SECTION 5.11. Evidence of Action Taken by Note Holder................................................. 71
SECTION 5.12. Right of Revocation of Action Taken..................................................... 72
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties......................................................... 72
SECTION 6.02. Absence of Duties....................................................................... 73
SECTION 6.03. No Representations or Warranties as to
Aircraft or Documents.................................................... 73
SECTION 6.04. No Segregation of Moneys; No Interest................................................... 74
(ii)
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Page
SECTION 6.05. Reliance; Agents; Advice of Counsel..................................................... 74
SECTION 6.06. Capacity in Which Acting................................................................ 75
SECTION 6.07. Compensation............................................................................ 75
SECTION 6.08. May Become Note Holder.................................................................. 76
SECTION 6.09. Further Assurances; Financing
Statements............................................................... 76
ARTICLE VII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification................................................................ 76
SECTION 7.02. Exculpation and Release of Liability.................................................... 77
ARTICLE VIII
SUCCESSOR TRUSTEES AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee....................................................... 78
SECTION 8.02. Resignation and Removal of Indenture
Trustee; Appointment of Successor........................................ 78
SECTION 8.03. Appointment of Separate Trustees........................................................ 79
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS TO THIS
INDENTURE AND OTHER DOCUMENTS
SECTION 9.01. Lease Amendments and Supplemental
Indentures............................................................... 81
SECTION 9.02. Effect of Supplemental Indenture........................................................ 84
SECTION 9.03. Documents to Be Given to Trustee........................................................ 85
SECTION 9.04. Notation on Notes in Respect of
Supplemental Indentures.................................................. 85
SECTION 9.05. Trustees Protected...................................................................... 85
SECTION 9.06. Documents Mailed to Note Holders........................................................ 85
SECTION 9.07. No Request Necessary for Lease
Supplement or Indenture Supplement....................................... 86
SECTION 9.08. Notices to Liquidity Provider........................................................... 86
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Indenture............................................................... 86
SECTION 10.02. No Legal Title to Trust Indenture
Estate in Note Holders.................................................. 87
SECTION 10.03. Sale of Aircraft by Indenture Trustee
(iii)
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is Binding.............................................................. 87
SECTION 10.04. Indenture for Benefit of Owner Trustee, Indenture Trustee, Owner Participant,
Lessee and Note Holders................................................. 87
SECTION 10.05. No Action Contrary to Lessee's Rights
Under the Lease......................................................... 87
SECTION 10.06. Notices................................................................................ 87
SECTION 10.07. Severability........................................................................... 88
SECTION 10.08. No Oral Modifications or Continuing
Waivers................................................................. 88
SECTION 10.09. Successors and Assigns................................................................. 88
SECTION 10.10. Headings............................................................................... 89
SECTION 10.11. Normal Commercial Relations............................................................ 89
SECTION 10.12. Governing Law; Counterpart Form........................................................ 89
SECTION 10.13. Section 1110........................................................................... 89
EXHIBIT A - Form of Trust Indenture Supplement
SCHEDULE I - Equipment Notes Amortization
SCHEDULE II - Pass Through Trust Agreements
(iv)
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FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1990 AWA-14]
FIRST AMENDED AND RESTATED TRUST INDENTURE AND SECURITY
AGREEMENT [GPA 1990 AWA-14] (this "First Amended and Restated Indenture" or this
"Indenture") dated as of November 26, 1996, between WILMINGTON TRUST COMPANY, a
Delaware banking corporation, not in its individual capacity except as otherwise
specifically set forth herein, but solely as owner trustee under the Trust
Agreement referred to below (in such capacity, together with its successors, the
"Owner Trustee"), and FLEET NATIONAL BANK (formerly known as Fleet National Bank
of Connecticut, Shawmut Bank Connecticut, National Association, and The
Connecticut National Bank), a national banking association, not in its
individual capacity except as otherwise specifically set forth herein, but
solely as indenture trustee hereunder (in such capacity, together with its
successors, the "Indenture Trustee").
W I T N E S S E T H :
WHEREAS, all capitalized terms used herein shall have the
respective meanings set forth or referred to in Article I hereof;
WHEREAS, the Owner Participant and Wilmington Trust Company
entered into the Trust Agreement [GPA 1990 AWA-14] dated as of September 21,
1990, as supplemented by Trust Agreement Supplement [GPA 1990 AWA-14] No. 1
dated September 28, 1990, and as further supplemented by Trust Agreement
Supplement [GPA 1990 AWA-14] No. 2 dated the date hereof (as amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, hereof and of the Refunding Agreement, the "Trust Agreement"),
whereby, among other things, Wilmington Trust Company has declared a certain
trust for the use and benefit of the Owner Participant, subject, however, to the
Trust Indenture Estate created pursuant hereto for the use and benefit of (to
the extent set forth herein), and with the priority of certain payments to, the
Holders of Equipment Notes issued hereunder, and the Owner Trustee is authorized
and directed to execute and deliver this Indenture;
WHEREAS, (i) the Owner Trustee and the Indenture Trustee
entered into the Trust Indenture and Security Agreement [GPA 1990 AWA-14] dated
as of September 21, 1990, as supplemented by Trust Indenture Supplement No. 1
dated September 28, 1990, which were recorded by the Federal Aviation
Administration on September 28, 1990 as one instrument and assigned Conveyance
No. E10184, as amended by Amendment No. 1 dated March 27, 1992,
Trust Indenture
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recorded by the Federal Aviation Administration on May 18, 1992 and assigned
Conveyance No. EE003011, and as further amended by Amendment No. 2 dated as of
July 29, 1993, recorded by the Federal Aviation Administration on August 4, 1993
and assigned Conveyance No. F59674 (collectively, as so amended, supplemented or
otherwise modified to the date hereof, the "Original Indenture"), (ii) the Owner
Trustee and the Original Head Lessee entered into the Aircraft Lease Agreement
[GPA 1990 AWA-14] dated as of September 21, 1990, as supplemented by Lease
Supplement [GPA 1990 AWA-14] No. 1 dated September 28, 1990, which were recorded
by the Federal Aviation Administration on September 28, 1990 as one instrument
and assigned Conveyance No. E10185, and as further supplemented by Lease
Supplement No. 2 dated December 31, 1991, which was not filed for recordation
with the Federal Aviation Administration (collectively, as so amended,
supplemented or otherwise modified to the date hereof, the "Original Lease") and
(iii) pursuant to the Original Indenture, the Owner Trustee issued and sold to
the Lenders (as defined in the Original Indenture) the Original Loan
Certificates;
WHEREAS, the parties have agreed to (i) assign, amend and
restate the Original Lease pursuant to Assignment and Amendment No. 1 and
Sublease Termination Agreement [GPA 1990 AWA-14] dated as of the date hereof
among the Original Head Lessee, as assignor and the Original Sublessee, as
assignee, the Owner Trustee and the Indenture Trustee and the Amended and
Restated Aircraft Lease Agreement [GPA 1990 AWA-14] dated as of the date hereof
between the Owner Trustee and the Lessee (as so assigned, amended and restated,
the "Amended and Restated Lease" or the "Lease") and to enter into Lease
Supplement No. 3 and (ii) cause the implementation of the Refinancing
Transaction pursuant to which, among other things, the Original Loan
Certificates issued pursuant to the Original Indenture shall be prepaid and new
Equipment Notes shall be issued to the Pass Through Trustees (or their
designee);
WHEREAS, in light of the foregoing and in anticipation of the
Refinancing Transaction, the parties desire by this First Amended and Restated
Indenture, among other things, (i) to amend and restate in its entirety the
Original Indenture, (ii) to provide for the issuance by the Owner Trustee of the
Equipment Notes and (iii) to provide for the assignment, mortgage and pledge by
the Owner Trustee to the Indenture Trustee, as part of the Trust Indenture
Estate hereunder, among other things, of certain of the Owner Trustee's estate,
right, title and interest in and to the Aircraft and, except as hereinafter
expressly provided, all of the Owner Trustee's right, title and interest in, to
and under the Lease (as amended and restated to date and as the same may at any
time and from time to time be further amended, restated or otherwise modified in
accordance with the terms thereof and hereof) and all payments and other amounts
Trust Indenture
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received hereunder or thereunder in accordance with the terms hereof or thereof,
as security for, among other things, the Owner Trustee's obligations to the
Indenture Trustee, for the ratable benefit and security of the Note Holders,
subject to Section 2.13 and Article III hereof;
WHEREAS, all things have been done to make the Equipment
Notes, when executed by the Owner Trustee and authenticated, issued and
delivered by the Indenture Trustee hereunder, the legal, valid and binding
obligations of the Owner Trustee; and
WHEREAS, all things necessary to make this First Amended and
Restated Indenture the legal, valid and binding obligation of the Owner Trustee,
for the uses and purposes herein set forth, in accordance with its terms, have
been done and performed and have happened;
GRANTING CLAUSE
NOW, THEREFORE, THIS FIRST AMENDED AND RESTATED TRUST
INDENTURE AND SECURITY AGREEMENT WITNESSETH, that, to secure the prompt payment
of the Principal Amount of, interest on, Make- Whole Amount, if any, and all
other amounts due with respect to, all Equipment Notes from time to time
outstanding hereunder and the performance and observance by the Owner Trustee of
all the agreements, covenants and provisions contained herein and in the
Refunding Agreement and the Equipment Notes, for the benefit of the Note
Holders, and the prompt payment of any and all amounts from time to time owing
hereunder and under the Refunding Agreement by the Owner Trustee, the Owner
Participant and the Lessee to the Note Holders and for the uses and purposes and
subject to the terms and provisions hereof, and in consideration of the premises
and of the covenants herein contained, and of the acceptance of the Equipment
Notes by the Holders thereof, and of the sum of $1 paid to the Owner Trustee by
the Indenture Trustee at or before the delivery hereof, the receipt whereof is
hereby acknowledged, the Owner Trustee has granted, bargained, sold, assigned,
transferred, conveyed, mortgaged, pledged and confirmed, and does hereby grant,
bargain, sell, assign, transfer, convey, mortgage, pledge and confirm, unto the
Indenture Trustee, its successors and assigns, for the security and benefit of
the Note Holders from time to time, a security interest in and mortgage Lien on
all estate, right, title and interest of the Owner Trustee in, to and under the
following described property, rights, interests and privileges, whether now or
hereafter acquired, other than Excepted Payments and Excepted Rights (which
collectively, excluding Excepted Payments and Excepted Rights but including all
property hereafter specifically subjected to the Lien of this Indenture by any
Indenture
Trust Indenture
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Supplement or any indenture supplemental hereto, are included within the Trust
Indenture Estate), to wit:
(1) the Aircraft (including the Airframe and the Engines) and
all replacements thereof and substitutions therefor to which the Owner
Trustee shall from time to time acquire an interest under the Lease,
all as more particularly described in the Indenture Supplement executed
and delivered with respect to the Aircraft or any such replacements or
substitutions therefor, as provided in this Indenture, and all records,
logs and other documents to which the Owner Trustee shall from time to
time acquire an interest at any time maintained by the Lessee with
respect to the foregoing property;
(2) the Lease (including each Lease Supplement) and all Rent
thereunder, including, without limitation, all amounts of Basic Rent,
Supplemental Rent and payments of any kind thereunder; the Refunding
Agreement; the Purchase Agreement, including the Consent and Guaranty
attached thereto (all to the extent assigned by the Purchase Agreement
Assignment and the Purchase Agreement Warranties Assignment); the
Purchase Agreement Warranties Assignment, with the Consents and
Agreements attached thereto; and the Bills of Sale; in each case
including, without limitation, (x) all rights of the Owner Trustee to
exercise any election or option or to make any decision or
determination or to give any notice, consent, waiver or approval or to
take any other action under or in respect of any such document or to
accept surrender or redelivery of the Aircraft or any part thereof, as
well as all the rights, powers and remedies on the part of the Owner
Trustee, whether arising under any such document or by statute or at
law or in equity, or otherwise, arising out of any Lease Event of
Default, and (y) any right to restitution from the Lessee, the
Manufacturer, the Manufacturer's Subsidiary or any other Person in
respect of any determination of invalidity of any such document;
(3) each Sublease Assignment and each Assigned Sublease (to
the extent assigned under such Sublease Assignment), and including,
without limitation, all rents or other payments of any kind made under
such Assigned Sublease (to the extent assigned under such Sublease
Assignment), all collateral security or credit support (in the nature
of a guarantee, letter of credit, credit insurance, Lien on or security
interest in any property or otherwise) for the obligations of the
Permitted Sublessee thereunder (to the extent assigned under such
Sublease Assignment) and all rights of the Owner Trustee to exercise
any election or option or to give any notice, consent, waiver, or
approval
Trust Indenture
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under or with respect of any thereof or to accept any surrender of the
Aircraft or any part thereof as well as any rights, powers or remedies
on the part of the Owner Trustee (in each case to the extent assigned
to the Owner Trustee), whether arising under any Assigned Sublease or
any Sublease Assignment or by statute or at law or in equity, or
otherwise, arising out of any default under any Assigned Sublease;
(4) all tolls, rents, issues, profits, revenues and other
income of the property subjected or required to be subjected to the
Lien of this Indenture, including, without limitation, all payments or
proceeds payable to the Owner Trustee after termination of the Lease
with respect to the Aircraft as the result of the sale, lease or other
disposition thereof, and all estate, right, title and interest of every
nature whatsoever of the Owner Trustee in and to the same and every
part thereof;
(5) all requisition proceeds with respect to the Aircraft or
any part thereof (to the extent of the Owner Trustee's interest therein
pursuant to the Lease), and all insurance proceeds with respect to the
Aircraft or any part thereof, including but not limited to the
insurance required under Section 12 of the Lease or under any
comparable provision of any Assigned Sublease (but excluding any excess
insurance maintained by the Lessee and not required under Section 12 of
the Lease or any Assigned Sublease);
(6) all moneys and securities now or hereafter paid or
deposited or required to be paid or deposited to or with the Indenture
Trustee by or for the account of the Owner Trustee pursuant to any term
of any Operative Document and held or required to be held by the
Indenture Trustee hereunder;
(7) all rights of the Owner Trustee to amounts paid or payable
by the Lessee to the Owner Trustee under the Refunding Agreement and
all rights of the Owner Trustee to enforce payments of any such amounts
thereunder; and
(8) all proceeds of the foregoing.
PROVIDED, HOWEVER, that the foregoing Granting Clause shall not subject to the
Lien of this Indenture any (i) Excepted Payments, (ii) Excepted Rights or (iii)
payment in amounts which have been distributed to the Owner Trustee or any other
Person in accordance with the provisions of this Agreement, AND SUBJECT TO
Sections 2.03, 5.10 and 9.01 hereof.
Concurrently with the delivery of the Original Indenture, the Owner Trustee
delivered to the Indenture Trustee the chattel
Trust Indenture
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paper original executed counterparts of the Original Lease and Lease Supplement
No. 1, certified copies of the Purchase Agreement Warranties Assignment and the
Consents and Agreements attached thereto, and the original Warranty ▇▇▇▇ of
Sale. The Owner Trustee thereafter delivered to the Indenture Trustee the
chattel paper original executed Lease Supplement No. 2. Concurrently with the
delivery of this Indenture, the Owner Trustee is delivering to the Indenture
Trustee the chattel paper original executed counterparts of the Amended and
Restated Lease and Lease Supplement No. 3. All property referred to in this
Granting Clause, whenever acquired by the Owner Trustee, shall secure all
obligations under and with respect to the Equipment Notes at any time
outstanding. Any and all properties referred to in this Granting Clause which
are hereafter acquired by the Owner Trustee, shall, without further conveyance,
assignment or act by the Owner Trustee or the Indenture Trustee thereby become
and be subject to the security interest hereby granted as fully and completely
as though specifically described herein.
HABENDUM CLAUSE
TO HAVE AND TO HOLD all and singular the aforesaid property
unto the Indenture Trustee, its successors and assigns, in trust for the benefit
and security of the Note Holders from time to time, except as set forth in
Section 2.13 and Article III hereof without any preference, distinction or
priority of any one Equipment Note over any other regardless of when issued, and
for the uses and purposes and subject to the terms and provisions set forth in
this Indenture.
It is expressly agreed that anything herein contained to the
contrary notwithstanding, the Owner Trustee shall remain liable under the
Indenture Documents to perform all of the obligations assumed by it thereunder,
all in accordance with and pursuant to the terms and provisions thereof, and the
Indenture Trustee and the Note Holders shall have no obligation or liability
under any thereof by reason of or arising out of the assignment hereunder, nor
shall the Indenture Trustee or the Note Holders be required or obligated in any
manner to perform or fulfill any obligations of the Owner Trustee under or
pursuant to any of the Indenture Documents, or except as herein expressly
provided, to make any payment, or to make any inquiry as to the nature or
sufficiency of any payment received by it, or present or file any claim or take
any action to collect or enforce the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
The Owner Trustee does hereby constitute the Indenture Trustee
the true and lawful attorney of the Owner Trustee, irrevocably, with full power
(in the name of the Owner Trustee or
Trust Indenture
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otherwise) to ask, require, demand, receive and give acquittance for any and all
moneys and claims for moneys (in each case including insurance and requisition
proceeds but excluding Excepted Payments and Excepted Rights) due and to become
due to the Owner Trustee under or arising out of the Indenture Documents and all
other property which now or hereafter constitutes part of the Trust Indenture
Estate, to endorse any checks or other instruments or orders in connection
therewith and to file any claims or to take any action or to institute any
proceedings which the Indenture Trustee may deem to be necessary or advisable in
the premises. Under the Lease, the Lessee is directed to make all payments of
Rent (other than Excepted Payments) and all other amounts which are required to
be paid to or deposited with the Owner Trustee pursuant to the Lease (other than
Excepted Payments) directly to the Indenture Trustee at such address or
addresses as the Indenture Trustee shall specify, for application as provided in
this Indenture. Pursuant to each Sublease Assignment, each Permitted Sublessee
will be directed from and after (i) notice of the occurrence of a Lease Event of
Default and (ii) notice that the Lease is declared or deemed in default, to make
all payments of rent and all other amounts which are required to be paid to or
deposited with the Lessee pursuant to the related Assigned Sublease and which
are assigned thereunder directly to the Indenture Trustee at such address or
addresses as the Indenture Trustee shall specify, for application or to be held
as provided in this Indenture. The Owner Trustee agrees that promptly on receipt
thereof, it will transfer to the Indenture Trustee any and all moneys from time
to time received by it constituting part of the Trust Indenture Estate, for
distribution by the Indenture Trustee pursuant to this Indenture, except (a) to
the extent the Owner Trustee is entitled to distribution of such moneys pursuant
to this Indenture and (b) that the Owner Trustee shall accept for distribution
pursuant to the Trust Agreement any amounts distributed to it by the Indenture
Trustee under this Indenture.
The Owner Trustee agrees that at any time and from time to
time, upon the written request of the Indenture Trustee, the Owner Trustee will
promptly and duly execute and deliver or cause to be duly executed and delivered
any and all such further instruments and documents as the Indenture Trustee may
reasonably deem desirable in obtaining the full benefits of the assignment
hereunder and of the rights and powers herein granted.
The Owner Trustee does hereby warrant and represent that it
has not assigned or pledged, and hereby covenants that it will not assign or
pledge or otherwise dispose of, so long as this Indenture shall remain in effect
and the Lien hereof shall not have been released pursuant to Section 10.01
hereof, any of its estate, right, title or interest hereby assigned, to anyone
other than the Indenture Trustee, and that, with respect to such
Trust Indenture
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estate, right, title and interest hereby assigned, subject to its rights
pursuant to Section 5.10 hereof, it will not, except as provided in this
Indenture (including, without limitation, Section 9.01) and except as to
Excepted Payments and Excepted Rights, (i) accept any payment from the Lessee or
any Permitted Sublessee under any of the Indenture Documents, enter into any
agreement amending, modifying or supplementing any of the Indenture Documents,
or execute any waiver or modification of, or consent under, the terms of any of
the Indenture Documents, (ii) settle or compromise any claim arising under any
of the Indenture Documents, (iii) give any notice or exercise any right or take
any action under any of the Indenture Documents, or (iv) submit or consent to
the submission of any dispute, difference or other matter arising under or in
respect of any of the Indenture Documents to arbitration thereunder. For
purposes of Section 4.02(e) hereof, this is the fourth paragraph following the
Habendum Clause.
The Owner Trustee hereby ratifies and confirms its obligations
under the Indenture Documents and does hereby agree that (except as permitted
herein) it will not take, or omit to take, any action, the taking or omission of
which might result in an alteration or impairment of any of the Indenture
Documents or of any of the rights created by any thereof or the assignment
hereunder.
Notwithstanding the Granting Clause or any of the preceding
paragraphs, there is hereby excluded from the foregoing sale, transfer,
assignment, grant, pledge and security interest all Excepted Payments and
Excepted Rights. Further, nothing in the Granting Clause or the preceding
paragraphs shall impair any of the rights of the Owner Trustee or the Owner
Participant under Section 5.10 hereof.
IT IS HEREBY COVENANTED AND AGREED by and between the parties
hereto as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Special Definitions. The definitions contained
in the Lease shall apply for all purposes of this Indenture except that the
following terms shall have the following meanings (such definitions to be
equally applicable to both the singular and plural forms of the terms defined)
for all purposes of this Indenture. Except as otherwise indicated, all the
agreements or instruments defined herein or in the Lease shall mean such
agreements or instruments (including all annexes, appendices, exhibits,
schedules and supplements thereto) as the
Trust Indenture
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same 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
thereof and of the other Operative Documents and references to various Persons
shall be deemed to be references to and include their respective permitted
successors and assigns.
"Amortization Amount" means, with respect to any Principal
Amount Repayment Date, the amount set forth opposite such Principal
Amount Repayment Date on the Amortization Schedule.
"Amortization Schedule" means the amortization schedule for
the Equipment Notes delivered pursuant to Section 2.02 hereof.
"Assigned Sublease" means a Permitted Sublease required to be
assigned to the Owner Trustee pursuant to Section 6(a) of the Lease.
"Average Life Date" for each Equipment Note to be redeemed
shall be the date which follows the redemption date by a period equal
to the Remaining Weighted Average Life at the redemption date of such
Equipment Note. "Remaining Weighted Average Life" of such Equipment
Note, at the redemption date of such Equipment Note, shall be the
number of days equal to the quotient obtained by dividing (a) the sum
of the products obtained by multiplying (i) the amount of each then
remaining installment of principal, including the payment due on the
maturity date of such Equipment Note, by (ii) the number of days from
and including the redemption date to but excluding the scheduled
payment date of such principal installment; by (b) the then unpaid
Principal Amount of such Equipment Note.
"Bankruptcy Code" means Chapter 11 of Title 11 of the
United States Code, 11 U.S.C. Section 101 et seq., as amended.
"Bills of Sale" means the FAA Bills of Sale and the
Warranty ▇▇▇▇ of Sale.
"Business Day" means a day other than a Saturday, Sunday or a
day on which banks are required or authorized to close in either The
City of New York, New York or Hartford, Connecticut.
"Cash Collateral Account" means one or more Eligible Deposit
Accounts in the name of the Subordination Agent each maintained at the
Subordination Agent, into which all amounts drawn under one or more
Liquidity Facilities
Trust Indenture
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pursuant to Section 3.6(c) or 3.6(i) of the Intercreditor
Agreement shall be deposited.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Consents and Agreements" means the confirmations by the
Manufacturer included in the Purchase Agreement Assignment and the
Purchase Agreement Warranties Assignment of the transfer of rights
under the Purchase Agreement.
"Continuous Stay Period" has the meaning specified in
Section 4.04(a).
"Corporate Trust Office" means the principal corporate trust
office of the Indenture Trustee located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Administration, or such
other office at which the Indenture Trustee's corporate trust business
shall be administered that the Indenture Trustee shall have specified
by notice in writing to the Lessee, the Owner Trustee and the Note
Holders.
"Debt" means any liability for borrowed money, or any
liability for the payment of money in connection with any letter of
credit transaction, or other liabilities evidenced or to be evidenced
by bonds, debentures, notes or other similar instruments.
"Debt Rate" means, with respect to Series A, Series B, Series
C, Series D and Series E, the rate per annum specified for such Series
under the heading "Debt Rate" in Schedule I to this Indenture.
"Delivery Date" means September 28, 1990.
"Dollars", "U.S. $" and "$" mean the lawful currency of
the United States of America.
"Downgrade Drawing" has the meaning assigned to such term in
Section 3.6(c) of the Intercreditor Agreement.
"Eligible Deposit Account" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account
with the corporate trust department of a depository institution
organized under the laws of the United States of America or any one of
the states thereof or the District of Columbia (or any U.S. branch of a
foreign bank), having corporate trust powers and acting as trustee for
funds deposited in such account, so long as any of the securities of
such depository institution has a long-term
Trust Indenture
16
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unsecured debt rating from each Rating Agency of at least A-3 or its
equivalent.
"Eligible Institution" means (a) the corporate trust
department of the Subordination Agent or any Pass Through Trustee, as
applicable, or (b) a depository institution organized under the laws of
the United States of America or any one of the states thereof or the
District of Columbia (or any U.S. branch of a foreign bank), which has
a long-term unsecured debt rating from each Rating Agency of at least
A-3 or its equivalent.
"Equipment Notes" means the Equipment Notes, in substantially
the form set out in Section 2.01 hereof, issued by the Owner Trustee
and authenticated by the Indenture Trustee pursuant to the terms of
this Indenture.
"Equity Collateral" has the meaning assigned to such
term in the definition of "Excepted Payments."
"Excepted Payments" means (i) any and all indemnity payments
and interest in respect thereof paid or payable in respect of the Owner
Participant, the Trust Company, the Owner Trustee (and not in support
of any payment obligation of the Owner Trustee under any Indenture
Document) or any of their respective successors, permitted assigns
(and, in the case of a permitted assign of the Owner Participant that
is a partnership, the partners of such partnership), directors,
officers, employees, servants, agents, subsidiaries, affiliates or
shareholders by the Lessee pursuant to the Lease (including, without
limitation, Section 13 thereof and any corresponding payment of
Supplemental Rent under the Lease), (ii) any proceeds of public
liability insurance (or government indemnities in lieu thereof) in
respect of the Aircraft payable as a result of insurance claims paid
respecting, or losses suffered by, the Trust Company or the Indenture
Trustee in its individual capacity or the Owner Participant, (iii) any
proceeds of insurance maintained with respect to the Aircraft by or for
the benefit of the Owner Participant (whether directly or through the
Owner Trustee) and not required under Section 12 of the Lease, (iv)
payments of Supplemental Rent by the Lessee in respect of any amounts
payable to the Owner Participant, the Trust Company, the Owner Trustee
(and not in support of any payment obligation of the Owner Trustee
under any Indenture Document), or any of their respective successors,
permitted assigns (and, in the case of a permitted assign of the Owner
Participant that is a partnership, the partners of such partnership),
directors, officers, employees, servants, agents, subsidiaries,
affiliates or shareholders under Section 10 of the Lease or by the
Lessee or the Parent
Trust Indenture
17
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Guarantor under the Tax Indemnification Agreement or the Amended and
Restated Head Lease TIA (as defined in the Refunding Agreement), as the
case may be, (v) Transaction Expenses paid or payable by the Lessee or
the Parent Guarantor to the Trust Company, the Owner Trustee, the
Indenture Trustee or the Owner Participant pursuant to Section 21 of
the Refunding Agreement or the Lease, (vi) any letter of credit
pursuant to Section 8(l) of the Lease (including, without limitation,
any replacement letter of credit (the "Equity Collateral")) and any
payment or proceeds of any such Equity Collateral to the extent
retained or applied as provided in Section 8(l) of the Lease, (vii) any
amount payable to the Owner Participant by any transferee as the
purchase price of the Owner Participant's interest in the Trust Estate
(or a portion thereof), (viii) any amount payable to the Owner Trustee,
the Trust Company or the Owner Participant or any of their respective
successors, permitted assigns (and, in the case of a permitted assign
of the Owner Participant that is a partnership, the partners of such
partnership), directors, officers, employees, servants, agents,
subsidiaries, affiliates or shareholders attributable to the period
prior to or on the Restatement Date or under the Original Participation
Agreement, the Original Lease, the Parent Head Lease Guaranty, the
Sublease, the Amended and Restated Head Lease TIA or the Amended and
Restated Sublease TIA (as such terms are defined in the Refunding
Agreement) or Retained Head Lease Rights and Obligations (as such term
is defined in the Refunding Agreement), and (ix) subject to the last
sentence of Section 5.10 hereof, any and all rights of the Owner
Trustee, the Owner Participant or the Trust Company under the Operative
Documents, whether or not a Lease Event of Default, a Lease Default, an
Indenture Default or an Indenture Trustee Event has occurred and is
continuing to demand, collect, ▇▇▇ for, give notices, make
determinations, enforce or exercise all rights with respect to and
otherwise obtain all amounts described in clauses (i) through (viii)
above and the proceeds thereof.
"Excepted Rights" means (i) those rights of the Owner
Participant and the Owner Trustee under Section 5.10 of this Indenture,
(ii) all rights under the Equity Collateral to make a claim for,
collect and retain all amounts payable with respect to any Equity
Collateral, (iii) all rights of the Owner Participant, the Trust
Company or the Owner Trustee to compromise or waive any such right or
modify, amend or waive any provision of any Operative Document
conferring such rights with respect to Excepted Payments, and (iv) all
rights of the Owner Trustee to exercise any election or option, or to
make any decision or determina-
Trust Indenture
18
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tion, or to give or receive any notice, consent, waiver or approval
with respect to Excepted Payments.
"Excess Amount" has the meaning specified in Section
2.03(b) hereof.
"FAA" means the Federal Aviation Administration of the United
States Department of Transportation or any successor agency.
"Final Drawing" means, in respect of a Liquidity Facility, a
borrowing or drawing of all available and undrawn amounts under such
Liquidity Facility in accordance with the provisions thereof other than
a Downgrade Drawing.
"Government Obligations" means direct obligations of the
United States of America that are not callable, redeemable or payable
prior to maturity, in whole or in part, directly or indirectly, by any
Person.
"Indenture," "this Indenture," and "the Indenture" mean this
First Amended and Restated Indenture, as it may from time to time be
supplemented or amended as herein provided, including as supplemented
by any Indenture Supplement pursuant hereto.
"Indenture Default" means an Indenture Event of Default or an
event or condition that, with the giving of notice or the lapse of time
or both, would become an Indenture Event of Default.
"Indenture Documents" means the Refunding Agreement; the Trust
Agreement (including any Trust Supplements); the Lease (including any
Lease Supplements); the Equipment Notes; this Indenture (including any
Indenture Supplements); any Sublease Assignment; any Assigned Sublease;
the Purchase Agreement, including the Consent and Guaranty attached
thereto (all to the extent assigned by the Purchase Agreement
Assignment and the Purchase Agreement Warranties Assignment); the
Purchase Agreement Warranties Assignment and the Consents and
Agreements attached thereto; and the Bills of Sale.
"Indenture Event of Default" has the meaning set forth
in Section 4.02 hereof.
"Indentures" means, collectively, each Trust Indenture and
Security Agreement listed on Schedule 1 to the Intercreditor Agreement,
as the same may be amended, supplemented or otherwise modified from
time to time in accordance with its terms.
Trust Indenture
19
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"Indenture Supplement" or "Trust Indenture Supplement" means a
supplement to this Indenture, in substantially the form of Exhibit A to
this Indenture, which shall particularly describe the Aircraft and any
Replacement Airframe and Replacement Engine included in the property of
the Owner Trustee covered by this Indenture, including, without
limitation, Trust Indenture Supplement No. 1 dated September 28, 1990,
which was recorded as one instrument by the FAA with the Original
Indenture, and Trust Indenture Supplement No. 2 dated November 26,
1996, which is being filed for recordation as one instrument by the FAA
with this First Amended and Restated Indenture.
"Indenture Trustee Event" means either (i) the Equipment Notes
shall have become due and payable pursuant to Section 4.04(b) or (c) of
this Indenture or (ii) the Indenture Trustee has taken action or
notified the Owner Trustee that it intends to take action to foreclose
the Lien of this Indenture or otherwise commence the exercise of any
significant remedy under this Indenture or the Lease.
"Interest Drawing" has the meaning assigned to such term in
Section 3.6(a) of the Intercreditor Agreement.
"Investment Earnings" means investment earnings on funds on
deposit in the Trust Accounts net of losses and investment expenses of
the Subordination Agent in making such investments.
"Lease" means the Original Lease, as the same may be modified,
supplemented or amended from time to time in accordance with the
provisions thereof and hereof and of the Refunding Agreement including,
without limitation, as assigned, amended and restated by Assignment and
Amendment No. 1 and Sublease Termination Agreement [GPA 1990 AWA-14]
dated as of the date hereof and Amended and Restated Aircraft Lease
Agreement [GPA 1990 AWA-14] dated as of the date hereof and
supplemented by Lease Supplement [GPA 1990 AWA-14] No. 3 dated November
26, 1996, which are being filed for recordation as one instrument with
the FAA contemporaneously herewith.
"Lease Default" means an event or condition that, with the
giving of notice or the lapse of time or both, would become a Lease
Event of Default.
"Lease Event of Default" means any event or condition defined
as an "Event of Default" in Section 17 of the Lease.
"Lessee" means America West Airlines, Inc., a Delaware
corporation, in its capacity as lessee under the Amended and
Trust Indenture
20
- 15 -
Restated Lease, and its successors, and to the extent permitted by the
Refunding Agreement, its assigns thereunder.
"Lien" means any mortgage, chattel mortgage, pledge, lien,
charge, encumbrance, lease, exercise of rights, security interest,
lease in the nature of a security interest, statutory right in rem, or
claim of any kind, including any thereof arising under any conditional
sale agreement, equipment trust agreement or title retention agreement.
"Majority in Interest of Note Holders" means, as of a
particular date of determination and subject to Section 2.6 of the
Intercreditor Agreement, the Holders of more than 50% in aggregate
unpaid Principal Amount of all Equipment Notes outstanding as of such
date. For purposes of this definition, there shall be excluded any
Equipment Notes held by the Owner Trustee or the Owner Participant or
any interests of the Owner Participant therein by reason of subrogation
pursuant to Section 4.03 of the Indenture (unless all Equipment Notes
then outstanding shall be held by the Owner Trustee or the Owner
Participant) or any Equipment Notes held by the Lessee or any Affiliate
of any thereof.
"Make-Whole Amount" means, with respect to any Equipment Note,
the amount (as determined by an independent investment banker selected
by Lessee and reasonably acceptable to the Indenture Trustee and the
Owner Participant) by which (a) the present value of the remaining
scheduled payments of principal and interest from the redemption date
to maturity of such Equipment Note computed by discounting each such
payment on a semiannual basis from its respective Payment Date
(assuming a 360-day year of twelve 30-day months) using a discount rate
equal to (i) in the case of Series A Equipment Notes and Series B
Equipment Notes, the Treasury Yield and (ii) in the case of Series C
Equipment Notes, Series D Equipment Notes and Series E Equipment Notes,
the Treasury Yield plus 0.75% exceeds (b) the outstanding principal
amount of such Equipment Note plus accrued interest. For purposes of
determining the Make-Whole Amount, "Treasury Yield" at the time of
determination with respect to any Equipment Note means the interest
rate (expressed as a semiannual equivalent and as a decimal and, in the
case of United States Treasury bills, converted to a bond equivalent
yield) determined to be the per annum rate equal to the semiannual
yield to maturity for United States Treasury securities maturing on the
Average Life Date of such Equipment Note and trading in the public
securities market either as determined by interpolation between the
most recent weekly average yield to maturity for two series
Trust Indenture
21
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of United States Treasury securities, trading in the public securities
markets, (A) one maturing as close as possible to, but earlier than,
the Average Life Date of such Equipment Note and (B) the other maturing
as close as possible to, but later than, the Average Life Date of such
Equipment Note, in each case as published in the most recent H.15(519)
or, if a weekly average yield to maturity for United States Treasury
securities maturing on the Average Life Date of such Equipment Note is
reported on the most recent H.15(519), such weekly average yield to
maturity as published in such H.15(519). "H.15(519)" means the weekly
statistical release designated as such, or any successor publication,
published by the Board of Governors of the Federal Reserve System. The
date of determination of a Make-Whole Amount shall be the third
Business Day prior to the applicable redemption date and the "most
recent H.15(519)" means the H.15(519) published prior to the close of
business on the third Business Day prior to the applicable redemption
date.
"Non-U.S. Holder" or "Non-U.S. Person" means any Person
other than a U.S. Person or a U.S. Holder.
"Note Holder" or "Holder" means any registered holder from
time to time of one or more Equipment Notes as reflected in the
Register maintained by the Registrar.
"Officers' Certificate" means a certificate (i) signed by a
Responsible Officer of the Owner Trustee or the Lessee, as the case may
be, and (ii) signed by another officer of the Owner Trustee or the
Lessee, as the case may be, certifying as to the authority and
signature of such Responsible Officer, that is delivered to the
Indenture Trustee.
"Opinion of Counsel" means a written opinion of legal counsel,
who in the case of legal counsel for the Lessee may be (i) an attorney
employed by the Lessee who is generally empowered to deliver such
written opinions or (ii) ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ or other counsel designated
by the Lessee and reasonably satisfactory to the Indenture Trustee or,
in the case of legal counsel for the Owner Trustee, may be Morris,
James, Hitchens & ▇▇▇▇▇▇▇▇ or other counsel designated by the Owner
Trustee and reasonably satisfactory to the Indenture Trustee.
"Original Head Lessee" means GPA Leasing USA Sub I, Inc., a
Connecticut corporation, in its capacity as lessee under the Original
Lease.
Trust Indenture
22
- 17 -
"Original Indenture" means the Trust Indenture and Security
Agreement [GPA 1990 AWA-14] dated as of September 21, 1990, as
supplemented by Trust Indenture Supplement No. 1 dated September 28,
1990, which were recorded as one instrument by the FAA on September 28,
1990 and assigned Conveyance No. E10184, as amended by Amendment No. 1
dated March 27, 1992, recorded by the FAA on May 18, 1992 and assigned
Conveyance No. EE003011, and as further amended by Amendment No. 2
dated as of July 29, 1993, recorded by the FAA on August 4, 1993 and
assigned Conveyance No. F59674.
"Original Loan Certificates" means the Loan Certificates
issued under and as defined in the Original Indenture.
"Original Sublessee" means America West Airlines, Inc.
("AWA"), a Delaware corporation, in its capacity as sublessee under the
Aircraft Sublease Agreement [GPA 1990 AWA-14] dated as of September 21,
1990 between the Original Head Lessee in its capacity as sublessor
thereunder and AWA in its capacity as sublessee.
"Owner Participant" means _____________________, a Delaware
corporation, as Owner Participant under the Trust Agreement, and its
successors and permitted assigns.
"Parent Guarantor" means GPA Group plc, a public limited
company organized and existing under the laws of Ireland.
"Pass Through Trust" means each of the five Pass Through
Trusts established under the relevant Pass Through Trust Agreement.
"Pass Through Trust Agreement" means the Pass Through
Trust Agreements set forth on Schedule II hereto.
"Pass Through Trustee" means Fleet National Bank, a national
banking association, not in its individual capacity but solely as pass
through trustee under each of the five separate Pass Through Trust
Agreements.
"Past Due Rate" means, with respect to any amount not paid
when due (whether at stated maturity, by acceleration or otherwise)
under or in respect of any Equipment Note, a rate of interest per annum
(computed on the basis of a year of 360 days comprised of twelve 30-day
months) equal to 1% in excess of the Debt Rate for such Equipment Note.
"Payment Date" means each January 2 and July 2, commencing on
January 2, 1997 (or, if any such day is not a
Trust Indenture
23
- 18 -
Business Day, the immediately succeeding Business Day) until the
Equipment Notes have been paid in full.
"Principal Amount" with respect to an Equipment Note means the
stated original principal amount of such Equipment Note and, with
respect to all Equipment Notes, means the aggregate stated original
principal amounts of all Equipment Notes.
"Principal Amount Repayment Date" means each Payment Date on
which any portion of the Principal Amount is due and payable in
accordance with the Amortization Schedule.
"Purchase Agreement Assignment" means the Purchase Agreement
Assignment [GPA 1990 AWA-14], dated as of the Delivery Date, between
the Parent Guarantor and the Original Head Lessee, together with the
Consents and Agreements attached thereto, as the same may be amended,
modified, or supplemented from time to time in accordance with the
terms hereof and thereof.
"Purchase Agreement Warranties Assignment" means the Purchase
Agreement Warranties Assignment [GPA 1990 AWA-14], dated as of the
Delivery Date, between the Original Head Lessee and the Owner Trustee
together with the Consents and Agreements attached thereto, as the same
may be amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof.
"Rating Agencies" means, collectively, at any time, each
nationally recognized rating agency which shall have been requested to
rate the Certificates issued pursuant to the Pass Through Trust
Agreements and which shall then be rating the Certificates. Initially,
the Rating Agencies shall consist of ▇▇▇▇▇'▇ Investors Service, Inc.
and Standard & Poor's Ratings Group, a division of ▇▇▇▇▇▇-▇▇▇▇ Inc.
"Refinancing Transaction" means the transactions contemplated
by the Refunding Agreement and the other documents entered into on and
in connection with the Refunding Agreement on the Restatement Date.
"Refunding Agreement" means the Refunding Agreement [GPA 1990
AWA-14] dated as of November 20, 1996, among the Lessee, the Original
Head Lessee, the Parent Guarantor, the Owner Trustee, the Pass Through
Trustee, the Owner Participant, the Subordination Agent and the
Indenture Trustee.
"Register" has the meaning set forth in Section 2.07
hereof.
Trust Indenture
24
- 19 -
"Registrar" has the meaning set forth in Section 2.07
hereof.
"Responsible Officer" means, in the case of the Lessee, the
president or any other officer with authority of at least a vice
president or, in the case of the Owner Trustee, an officer of the Owner
Trustee in its Corporate Trust Administration Department.
"Restatement Date" means November 26, 1996 or such other date
agreed to by the parties to the Refunding Agreement as the date for the
consummation of the Refinancing Transaction, as evidenced by the date
of the filing with the FAA of Trust Indenture Supplement No. 2.
"Secured Obligations" has the meaning set forth in
Section 2.06 hereof.
"Securities Act" means the Securities Act of 1933, as
amended.
"Series A" or "Series A Equipment Notes" means Equipment Notes
issued and designated as "Series A" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series A."
"Series B" or "Series B Equipment Notes" means Equipment Notes
issued and designated as "Series B" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series B."
"Series C" or "Series C Equipment Notes" means Equipment Notes
issued and designated as "Series C" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series C."
"Series D" or "Series D Equipment Notes" means Equipment Notes
issued and designated as "Series D" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series D."
"Series E" or "Series E Equipment Notes" means Equipment Notes
issued and designated as "Series E" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series E."
Trust Indenture
25
- 20 -
"Sublease Assignment" means a sublease assignment by the
Lessee in favor of the Owner Trustee (including the consent thereto
given by the sublessee thereunder) with respect to the assignment of a
Permitted Sublease pursuant to Section 6(a) of the Lease.
"Transaction Expenses" means the costs, fees, expenses and
disbursements set forth in Section 21 of the Refunding Agreement.
"Trust Accounts" has the meaning assigned to such term in
Section 2.2(a) of the Intercreditor Agreement.
"Trust Company" means Wilmington Trust Company, a Delaware
banking corporation, in its individual capacity and not as Owner
Trustee, and its successors under the Trust Agreement, in their
respective individual capacities and not as Owner Trustee.
"Trust Indenture Estate" or "Indenture Estate" means all
estate, right, title and interest of the Owner Trustee in and to the
properties, rights and interests covered by the Granting Clause of the
Indenture, excluding, however, in each case, Excepted Payments and
Excepted Rights.
"U.S. Holder" or "U.S. Person" means any Person that is (i) a
citizen or resident of the United States, as defined in Section
7701(a)(9) of the Code (for purposes of this definition, the "United
States"), (ii) a corporation, partnership or other entity created or
organized under the laws of the United States or any political
subdivision thereof or therein or (iii) any estate or trust that is
subject to United States federal income taxation regardless of the
source of its income.
"Warranty ▇▇▇▇ of Sale" means a full warranty (as to title)
▇▇▇▇ of sale covering the Aircraft (excluding all Buyer Furnished
Equipment) executed by the Original Head Lessee in favor of the Owner
Trustee dated the Delivery Date.
Trust Indenture
26
- 21 -
ARTICLE II
THE EQUIPMENT NOTES
SECTION 2.01. Form of Equipment Notes. The Equipment Notes
shall be substantially in the form set forth below:
THIS EQUIPMENT NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR PURSUANT TO
THE SECURITIES LAWS OF ANY STATE. ACCORDINGLY, THIS EQUIPMENT
NOTE MAY NOT BE SOLD UNLESS EITHER REGISTERED UNDER THE ACT AND
SUCH APPLICABLE STATE LAWS OR AN EXEMPTION FROM SUCH
REGISTRATIONS IS AVAILABLE.
WILMINGTON TRUST COMPANY,
AS OWNER TRUSTEE UNDER TRUST AGREEMENT [GPA 1990 AWA-14]
DATED AS OF SEPTEMBER 21, 1990, AS AMENDED.
SERIES [A/B/C/D/E] NON-RECOURSE EQUIPMENT NOTE DUE [ ]
ISSUED IN CONNECTION WITH ONE AIRBUS ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ REGISTRATION NUMBER N635AW.
No.____________ Date: [________, 1996]
$___________________
DEBT RATE MATURITY DATE
[ ] [ , ]
WILMINGTON TRUST COMPANY, not in its individual capacity but
solely as Owner Trustee (herein in such capacity called the "Owner Trustee")
under that certain Trust Agreement [GPA 1990 AWA-14], dated as of September 21,
1990, as amended, between the Owner Participant named therein and Wilmington
Trust Company (herein as such Trust Agreement may be supplemented or amended
from time to time called the "Trust Agreement"), hereby promises to pay to Fleet
National Bank, as Subordination Agent under the Intercreditor Agreement, or the
registered assignee thereof, the principal sum of $_______ (the "Principal
Amount"), together with interest on the Principal Amount remaining unpaid from
time to time (calculated on the basis of a year of 360 days comprised of twelve
30-day months) from the date hereof until paid in full at a rate per annum equal
to the Debt Rate indicated above. The Principal Amount of this Equipment Note
shall be payable in installments on the dates set forth in Schedule I hereto
equal to the corresponding percentage of the Principal Amount of this Equipment
Note set forth in Schedule I hereto. Accrued but unpaid interest shall be due
and payable in semi-annual installments commencing on January 2, 1997, and
thereafter
Trust Indenture
27
- 22 -
on July 2 and January 2 of each year, to and including ___________, ____.
Notwithstanding the foregoing or anything to the contrary
contained herein, (i) the final payment made on this Equipment Note shall be in
an amount sufficient to discharge in full the unpaid Principal Amount and all
accrued and unpaid interest on, and any other amounts due under, this Equipment
Note; and (ii) if any date on which a payment under this Equipment Note becomes
due and payable is not a Business Day, then such payment shall not be made on
such scheduled date but shall be made on the next succeeding Business Day and if
such payment is made on such next succeeding Business Day, no interest shall
accrue on the amount of such payment during such extension.
For purposes hereof, the term "Indenture" means the First
Amended and Restated Trust Indenture and Security Agreement [GPA 1990 AWA-14],
dated as of November 26, 1996, between the Owner Trustee and Fleet National Bank
(formerly known as Fleet National Bank of Connecticut, Shawmut Bank Connecticut,
National Association, and The Connecticut National Bank) (the "Indenture
Trustee"), as the same may be amended or supplemented from time to time. All
other capitalized terms used in this Equipment Note and not defined herein shall
have the respective meanings assigned in the Indenture.
This Equipment Note shall bear interest, payable on demand, at
the Past Due Rate (calculated on the basis of a year of 360 days comprised of
twelve 30-day months) on any overdue Principal Amount, any overdue Make-Whole
Amount, if any, and (to the extent permitted by applicable law) any overdue
interest and any other amounts payable hereunder which are overdue, in each case
for the period the same is overdue. Amounts shall be overdue if not paid when
due (whether at stated maturity, by acceleration or otherwise).
All payments of all or any portion of the Principal Amount,
interest, Make-Whole Amount, if any, and other amounts, if any, to be made by
the Owner Trustee hereunder and under the Indenture or the Refunding Agreement
shall be payable only from the income and proceeds from the Trust Estate to the
extent included in the Trust Indenture Estate and only to the extent that the
Owner Trustee shall have sufficient income or proceeds from the Trust Estate to
the extent included in the Trust Indenture Estate to enable the Indenture
Trustee to make such payments in accordance with the terms of Section 2.03 and
Article III of the Indenture, and each Holder hereof, by its acceptance of this
Equipment Note, agrees that it will look solely to the income and proceeds from
the Trust Indenture Estate to the extent available for distribution to the
Holder hereof as above provided and that none of the Owner Participant, the
Owner Trustee and the
Trust Indenture
28
- 23 -
Indenture Trustee is personally liable or liable in any manner, including,
without limitation, extending to any assets other than the Trust Indenture
Estate to the Holder hereof for any amounts payable or any liability under this
Equipment Note or, except as provided in the Indenture or in the Refunding
Agreement, for any liability under the Indenture or the Refunding Agreement;
provided, however, that nothing herein contained shall limit, restrict or impair
any and all rights or remedies of the Indenture Trustee hereunder, subject
always to the terms and provisions of the Indenture.
There shall be maintained a Register for the purpose of
registering transfers and exchanges of Equipment Notes at the Corporate Trust
Office of the Indenture Trustee or at the office of any successor in the manner
provided in Section 2.07 of the Indenture.
Any payment of any portion of the Principal Amount and
interest and other amounts due hereunder shall be payable in Dollars in
immediately available funds at the Corporate Trust Office of the Indenture
Trustee, or as otherwise provided in the Indenture. Each such payment shall be
made on the date such payment is due and without any presentment or surrender of
this Equipment Note, except that in the case of any final payment with respect
to this Equipment Note, the Equipment Note shall be surrendered promptly
thereafter to the Indenture Trustee for cancellation.
The Holder hereof, by its acceptance of this Equipment Note,
agrees that, except as provided in the Indenture, each payment received by it
hereunder shall be applied, first, to the payment of accrued interest on this
Equipment Note (as well as any interest on any overdue Principal Amount, any
overdue Make-Whole Amount, if any, and to the extent permitted by law, any
overdue interest and any other overdue amounts hereunder) to the date of such
payment, second, to the payment of the portion of the Principal Amount of this
Equipment Note then due, third, to the payment of Make-Whole Amount, if any, and
any other amount due hereunder or under the Indenture, and fourth, the balance,
if any, remaining thereafter, to the payment of the portion of the Principal
Amount of this Equipment Note remaining unpaid in the inverse order of its
normal maturity.
This Equipment Note is one of the Equipment Notes referred to
in the Indenture which have been or are to be issued by the Owner Trustee
pursuant to the terms of the Indenture. The Trust Indenture Estate is held by
the Indenture Trustee as security, in part, for the Equipment Notes. The
provisions of this Equipment Note are subject to the Indenture. Reference is
hereby made to the Indenture and the Refunding Agreement for a complete
statement of the rights and obligations of the Holder
Trust Indenture
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of, and the nature and extent of the security for, this Equipment Note and the
rights and obligations of the Holders of, and the nature and extent of the
security for, any other Equipment Notes executed and delivered under the
Indenture, as well as for a statement of the terms and conditions of the trusts
created by the Indenture, to all of which terms and conditions in the Indenture
and the Refunding Agreement each Holder hereof agrees by its acceptance of this
Equipment Note.
As provided in the Indenture and subject to certain
limitations therein set forth, this Equipment Note is exchangeable for a like
aggregate unpaid portion of the Principal Amount of Equipment Notes of different
authorized denominations, as requested by the Holder surrendering the same.
Prior to due presentment for registration of transfer of this
Equipment Note, the Owner Trustee and the Indenture Trustee shall treat the
Person in whose name this Equipment Note is registered as the owner hereof for
all purposes whether or not this Equipment Note be overdue, and neither of the
Owner Trustee nor the Indenture Trustee shall be affected by notice to the
contrary.
This Equipment Note is subject to redemption as provided in
Sections 2.10 and 2.11 of the Indenture, to purchase by the Owner Participant or
the Owner Trustee as provided in Section 2.12 of the Indenture and to
acceleration by the Indenture Trustee as provided in Section 4.04 of the
Indenture.
[The indebtedness evidenced by this Equipment Note is, to the
extent and in the manner provided in the Indenture, subordinate and subject in
right of payment to the prior payment in full of the Secured Obligations (as
defined in the Indenture) in respect of [Series A Equipment Notes](1) [Series B
Equipment Notes](2) [Series C Equipment Notes](3) [Series D Equipment Notes](4),
and this Equipment Note is issued subject to such provisions. The Note Holder of
this Equipment Note, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Indenture Trustee on his behalf
to take such action as may be necessary or appropriate to effectuate
--------
(1) To be inserted in the case of Series B Equipment Notes.
(2) To be inserted in the case of Series C Equipment Notes.
(3) To be inserted in the case of Series D Equipment Notes.
(4) To be inserted in the case of Series E Equipment Notes.
Trust Indenture
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the subordination as provided in the Indenture and (c) appoints the Indenture
Trustee his attorney-in-fact for such purpose.](5)
Unless the certificate of authentication hereon has been
executed by or on behalf of the Indenture Trustee by manual signature, this
Equipment Note shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
THIS EQUIPMENT NOTE SHALL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL
MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
* * *
IN WITNESS WHEREOF, the Owner Trustee has caused this
Equipment Note to be executed in its corporate name by its officer thereunto
duly authorized on the date hereof.
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By:_______________________________
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Equipment Notes referred to in the
within-mentioned Indenture.
FLEET NATIONAL BANK,
as Indenture Trustee
By:__________________________
Name:
Title:
________________
(5) To be inserted in the case of a Series B, Series C, Series D or Series
E Equipment Note.
Trust Indenture
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SCHEDULE I
EQUIPMENT NOTES AMORTIZATION
Percentage of
Principal Amount Principal Amount
Repayment Date to be Paid
[SEE SCHEDULE I TO TRUST INDENTURE
WHICH IS INSERTED UPON ISSUANCE]
* * *
SECTION 2.02. Issuance and Terms of Equipment Notes. The
Equipment Notes shall be dated the date of issuance thereof, shall be issued in
five separate series consisting of Series A, Series B, Series C, Series D and
Series E and in the maturities and principal amounts and shall bear interest as
specified in Schedule I hereto. On the date of the consummation of the
Refinancing Transaction, (i) each Equipment Note shall be issued to the Pass
Through Trustees (or their designee) under the Pass Through Trust Agreements set
forth in Schedule II to be attached hereto in connection therewith and (ii) the
Original Loan Certificates issued under the Original Indenture shall be
concurrently prepaid. The Equipment Notes shall be issued in registered form
only. The Equipment Notes shall be issued in denominations of $1,000 and
integral multiples thereof, except that one Equipment Note of each Series may be
in an amount that is not an integral multiple of $1,000.
Each Equipment Note shall bear interest at the Debt Rate
(calculated on the basis of a year of 360 days comprised of twelve 30-day
months) on the unpaid Principal Amount thereof from time to time outstanding,
payable in arrears on January 2, 1997, and on each July 2 and January 2
thereafter until maturity.
The Principal Amount of each Equipment Note shall be payable
on the dates and in the installments equal to the corresponding percentage of
the Principal Amount as set forth in Schedule I hereto which shall be attached
as Schedule I to the Equipment Notes. Notwithstanding the foregoing, the final
payment made under each Equipment Note shall be in an amount sufficient to
discharge in full the unpaid portion of the Principal Amount and all accrued and
unpaid interest on, and any other amounts due under, such Equipment Note. Each
Equipment Note shall bear interest at the Past Due Rate (calculated on the basis
of a year of 360 days comprised of twelve 30-day months) on
Trust Indenture
32
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any part of the Principal Amount, Make-Whole Amount, if any, and, to the extent
permitted by applicable law, interest and any other amounts payable thereunder
not paid when due for any period during which the same shall be overdue, in each
case for the period the same is overdue. Amounts shall be overdue if not paid
when due (whether at stated maturity, by acceleration or otherwise).
Notwithstanding anything to the contrary contained herein, if any date on which
a payment under any Equipment Note becomes due and payable is not a Business Day
then such payment shall not be made on such scheduled date but shall be made on
the next succeeding Business Day and if such payment is made on such next
succeeding Business Day, no interest shall accrue on the amount of such payment
during such extension.
The Owner Trustee agrees to pay to the Indenture Trustee for
distribution in accordance with Section 3.04 hereof (a) any and all indemnity
amounts received by the Owner Trustee which are payable by Lessee to (i) the
Indenture Trustee in its individual capacity, (ii) the Pass Through Trusts,
(iii) the Subordination Agent, (iv) the Liquidity Providers, or (v) the Pass
Through Trustees, in each case pursuant to Sections 10 and 13 of the Lease or
Section 21 of the Refunding Agreement, (b) any and all amounts received by the
Owner Trustee which are payable by Lessee in respect of and equal to the Owner
Trustee's pro rata share (as defined below) of all amounts owed to the Liquidity
Providers by the Subordination Agent under each Liquidity Facility (as
determined by the Subordination Agent in consultation with the Liquidity
Providers and notified to the Indenture Trustee) other than amounts due as (i)
repayments of the principal of advances thereunder, and (ii) interest on
Interest Drawings, Final Drawings and Applied Downgrade Drawings under any
Liquidity Facility except to the extent included in Net Interest and Related
Charges (as defined below), and (c) any and all amounts received by the Owner
Trustee which are payable by Lessee under clause (vii) or (viii) of the
definition of Supplemental Rent. The Indenture Trustee shall have no duty or
obligation to (i) verify or confirm the accuracy of any of the amounts (other
than the portion of the Principal Amount of, and interest on, the Equipment
Notes issued hereunder) paid to it by the Owner Trustee or (ii) determine
whether any amounts are owed by the Owner Trustee under this Section 2.02. As
used in this Section 2.02, "Owner Trustee's pro rata share" means as of any
time:
(A) with respect to all amounts other than Net Interest and
Related Charges, a fraction the numerator of which is the aggregate
principal balance then outstanding of the Equipment Notes issued
hereunder and the denominator of which is the aggregate principal
balance then outstanding of all "Equipment Notes" issued under the
Indentures, and
Trust Indenture
33
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(B) with respect to all Net Interest and Related Charges (x)
if there exists a Payment Default (as defined below) under any
Equipment Note a fraction, the numerator of which is the aggregate
principal balance then outstanding of the Equipment Notes issued
hereunder and the denominator of which is the aggregate principal
balance then outstanding of all "Equipment Notes" issued under the
Indentures under which there exists a Payment Default or (y) at all
other times, zero;
provided, however, neither the numerator nor the denominator of the fractions in
paragraphs (A) or (B) shall include any "Series D Equipment Notes" or "Series E
Equipment Notes" issued under the Indentures. As used in this Section 2.02, "Net
Interest and Related Charges" means (as determined by the Subordination Agent in
consultation with the Liquidity Providers and notified to the Indenture Trustee
except that the Past Due Rate shall be determined by the Indenture Trustee and
notified to the Subordination Agent) the sum of (i) the amount, if any, by which
interest payable to any Liquidity Provider on any Interest Drawing, Final
Drawing and/or Downgrade Drawing (other than a Downgrade Drawing that is not an
Applied Downgrade Drawing (as defined in the Liquidity Facilities)) exceeds the
amount which would be payable if such advances bore interest at the Designated
Interest Rate (as defined below) plus (ii) any amounts payable under Section
3.1, Section 3.2, Section 3.3, Section 3.9 or Section 7.7 of each Liquidity
Facility (or similar provisions of any succeeding liquidity facility) which
result from any Interest Drawing, Final Drawing or Downgrade Drawing. As used in
this Section 2.02, "Designated Interest Rate" means the weighted average Past
Due Rate (as defined in the applicable Indentures) in respect of "Series A
Equipment Notes," "Series B Equipment Notes" and "Series C Equipment Notes"
issued under the Indentures, except with respect to that portion of any Final
Drawing (or Downgrade Drawing which becomes a Final Drawing) which remains in a
Cash Collateral Account, Designated Interest Rate means the weighted average
Investment Earnings of funds in the Cash Collateral Accounts. As used in this
Section 2.02, a "Payment Default" when used in connection with an "Equipment
Note" issued under an Indenture means a default in the payment of principal
thereof or interest thereon, other than a default in the payment of principal or
interest on a "Series D Equipment Note" or "Series E Equipment Note" issued
under the Indentures which has not been cured other than solely because of
acceleration. For purposes of Section 3.04(b) hereof, this is the fourth
paragraph of Section 2.02.
The Equipment Notes shall be executed on behalf of the Owner
Trustee by its President or one of its Vice Presidents, Assistant Vice
Presidents or Assistant Secretaries or other authorized officer. Equipment Notes
bearing the signatures of
Trust Indenture
34
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individuals who were at any time the proper officers of the Owner Trustee shall
bind the Owner Trustee, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of
such Equipment Notes or did not hold such offices at the respective dates of
such Equipment Notes. The Owner Trustee may from time to time execute and
deliver Equipment Notes with respect to the Aircraft to the Indenture Trustee
for authentication upon original issue and such Equipment Notes shall thereupon
be authenticated and delivered by the Indenture Trustee upon the written request
of the Owner Trustee signed by a Vice President or Assistant Vice President or
other authorized officer of the Owner Trustee; provided, however, that each such
request shall specify the aggregate Principal Amount of all Equipment Notes to
be authenticated hereunder on original issue with respect to the Aircraft. No
Equipment Note shall be secured by or be entitled to any benefit under this
Indenture or be valid or obligatory for any purposes, unless there appears on
such Equipment Note a certificate of authentication in the form provided for
herein executed by the Indenture Trustee by the manual signature of one of its
authorized officers and such certificate upon any Equipment Notes shall be
conclusive evidence, and the only evidence, that such Equipment Note has been
duly authenticated and delivered hereunder.
SECTION 2.03. Payments from Trust Indenture Estate Only. (a)
Without impairing any of the other rights, powers, remedies, privileges or Liens
of the Note Holders under this Indenture, each Note Holder, by its acceptance of
an Equipment Note, agrees that, except as expressly provided in this Indenture,
the Refunding Agreement or any other Operative Document, (i) the obligation to
make all payments of all or any portion of the Principal Amount of, interest on,
Make-Whole Amount, if any, and all other amounts due with respect to the
Equipment Notes, and the performance by the Owner Trustee of every obligation or
covenant contained in this Indenture and in the Refunding Agreement or any of
the other Operative Documents, shall be payable only from the income and
proceeds from the Trust Estate to the extent included in the Trust Indenture
Estate and only to the extent that the Owner Trustee shall have sufficient
income or proceeds from the Trust Estate to the extent included in the Trust
Indenture Estate to enable the Indenture Trustee to make such payments in
accordance with the terms of Article III hereof, and all of the statements,
representations, covenants and agreements made by the Owner Trustee (when made
in such capacity) contained in this Indenture and any other Operative Document
other than the Trust Agreement, unless expressly otherwise stated, are made and
intended only for the purpose of binding the Trust Estate and establishing the
existence of rights and remedies which can be exercised and enforced against the
Trust Estate; therefore, anything contained in this Indenture or such
Trust Indenture
35
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other agreements to the contrary notwithstanding (except for any express
provisions or representations that the Trust Company is responsible for, or is
making, for which there would be personal liability of the Trust Company), no
recourse shall be had with respect to this Indenture or such other agreements
against the Trust Company or against any institution or Person which becomes a
successor trustee or co-trustee or any officer, director, trustee, servant or
direct or indirect parent or controlling Person or Persons of any of them, and
(ii) none of the Trust Company, the Owner Participant, the Indenture Trustee and
any officer, director, trustee, servant, employee, agent or direct or indirect
parent or controlling Person or Persons of any of them shall have any personal
liability for any amounts payable, or other obligation owed, hereunder, under
the Refunding Agreement or any of the other Operative Documents or under the
Equipment Notes except as expressly provided herein (in the case of the Owner
Trustee and the Indenture Trustee) or therein; provided, however, nothing
contained in this Section 2.03(a) shall be construed to limit the exercise and
enforcement in accordance with the terms of this Indenture or such other
agreements of rights and remedies against the Trust Indenture Estate.
(b) If (i) all or any part of the Trust Estate becomes the
property of, or the Owner Trustee or Owner Participant becomes, a debtor subject
to the reorganization provisions of the Bankruptcy Code, (ii) pursuant to such
reorganization provisions, including Section 1111(b) of the Bankruptcy Code, the
Trust Company, the Owner Trustee or the Owner Participant is required, by reason
of the Trust Company, the Owner Trustee or the Owner Participant being held to
have recourse liability to any Note Holder or the Indenture Trustee, directly or
indirectly (other than the recourse liability of the Trust Company, the Owner
Trustee or the Owner Participant under the Operative Documents), to make payment
on account of any amount payable as Principal Amount, Make-Whole Amount, if any,
interest or other amounts on the Equipment Notes or under this Indenture and
(iii) any Note Holder or the Indenture Trustee actually receives any Excess
Amount (as hereinafter defined) which reflects any payment by the Trust Company,
the Owner Trustee or the Owner Participant on account of clause (ii) above
(other than aforesaid), then such Note Holder or the Indenture Trustee, as the
case may be, shall promptly refund to the Trust Company, the Owner Trustee or
the Owner Participant (whichever shall have made such payment) such Excess
Amount.
For purposes of this Section 2.03(b), "Excess Amount" means
the amount by which such payment exceeds the amount that would have been
received by a Note Holder or the Indenture Trustee if the Trust Company, the
Owner Trustee or the Owner Participant had not become subject to the recourse
liability referred to in clause (ii) above. Nothing contained in this
Trust Indenture
36
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Section 2.03(b) shall prevent a Note Holder or the Indenture Trustee from
enforcing any personal recourse obligation (and retaining the proceeds thereof)
of the Trust Company, the Owner Trustee or the Owner Participant under the
Refunding Agreement, this Indenture (and any exhibits or annexes hereto or
thereto) or any other Operative Document.
SECTION 2.04. Method of Payment. (a) The Principal Amount of,
interest on, Make-Whole Amount, if any, and other amounts due under each
Equipment Note or hereunder will be payable in Dollars by wire transfer of
immediately available funds not later than 12:00 noon, New York City time, on
the due date of payment to the Indenture Trustee at the Corporate Trust Office
for distribution among the Note Holders in the manner provided herein. After
transferring (or causing the transfer of) the above amounts to the Indenture
Trustee, the Owner Trustee shall not have any responsibility for the
distribution of such payment to any Note Holder. Notwithstanding the foregoing
or any provision in any Equipment Note to the contrary, the Indenture Trustee
will use reasonable efforts to pay or cause to be paid, if so directed in
writing by any Note Holder (with a copy to the Owner Trustee), all amounts paid
by the Owner Trustee hereunder and under such Holder's Equipment Note or
Equipment Notes to such Holder or a nominee therefor (including all amounts
distributed pursuant to Article III of this Indenture) by transferring, or
causing to be transferred, by wire transfer of immediately available funds in
Dollars, prior to 2:00 p.m., New York City time, on the due date of payment, to
an account maintained by such Holder with a bank located in the continental
United States the amount to be distributed to such Holder, for credit to the
account of such Holder maintained at such bank. If the Indenture Trustee shall
fail to make any such payment as provided in the immediately preceding sentence
after its receipt of funds at the place and prior to the time specified above,
the Indenture Trustee, in its individual capacity and not as trustee and without
indemnification or right of reimbursement under any Operative Document, agrees
to compensate such Holders for loss of use of funds in accordance with industry
standards for this type of transaction until such payment is made and the
Indenture Trustee shall be entitled to any interest earned on such funds until
such payment is made. Any payment made hereunder shall be made free and clear of
and without reduction for or on account of all wire and like charges and without
any presentment or surrender of any Equipment Note, except that, in the case of
the final payment in respect of any Equipment Note, such Equipment Note shall be
surrendered to the Indenture Trustee for cancellation promptly after such
payment. Notwithstanding any other provision of this Indenture to the contrary,
the Indenture Trustee shall not be required to make, or cause to be made, wire
transfers as aforesaid prior to the first Business Day on which it is
practicable for the Indenture Trustee to do so if such
Trust Indenture
37
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funds were received after 12:00 noon, New York City time, at the place of
payment. Prior to the due presentment for registration of transfer of any
Equipment Note, the Owner Trustee and the Indenture Trustee shall deem and treat
the Person in whose name any Equipment Note is registered on the Register as the
absolute owner and Holder of such Equipment Note for the purpose of receiving
payment of all amounts payable with respect to such Equipment Note and for all
other purposes, and neither the Owner Trustee nor the Indenture Trustee shall be
affected by any notice to the contrary, unless and until such change is
reflected in the Register. So long as any signatory to the Refunding Agreement
or nominee thereof shall be a registered Note Holder, all payments to it shall
be made to the account of such Note Holder specified in Schedule III thereto and
otherwise in the manner provided in or pursuant to the Refunding Agreement
unless it shall have specified some other account or manner of payment by notice
to the Indenture Trustee consistent with this Section 2.04.
(b) The Indenture Trustee, as agent for the Owner Trustee,
shall exclude and withhold at the appropriate rate from each payment of
Principal Amount of, interest on, Make-Whole Amount, if any, and other amounts
due hereunder or under each Equipment Note (and such exclusion and withholding
shall constitute payment in respect of such Equipment Note) any and all United
States withholding taxes applicable thereto as required by law. The Indenture
Trustee agrees to act as such withholding agent and, in connection therewith,
whenever any present or future United States taxes or similar charges are
required to be withheld with respect to any amounts payable hereunder or in
respect of the Equipment Notes, to withhold such amounts (and such withholding
shall constitute payment in respect of such Equipment Note) and timely pay the
same to the appropriate authority in the name of and on behalf of the Note
Holders, that it will file any necessary United States withholding tax returns
or statements when due, and that as promptly as possible after the payment
thereof it will deliver to each Note Holder (with a copy to the Owner Trustee
and the Lessee) appropriate receipts showing the payment thereof, together with
such additional documentary evidence as any such Note Holder, the Owner
Participant and the Owner Trustee may reasonably request from time to time.
If a Note Holder which is a Non-U.S. Person has furnished to
the Indenture Trustee a properly completed and currently effective U.S. Internal
Revenue Service Form 1001 or W-8 (or such successor form or forms as may be
required by the United States Treasury Department) during the calendar year in
which the payment hereunder or under the Equipment Note(s) held by such Holder
is made (but prior to the making of such payment) or in either of the two
preceding calendar years, and has not notified the Indenture Trustee of the
withdrawal or inaccuracy of
Trust Indenture
38
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such form prior to the date of such payment (and the Indenture Trustee has no
reason to know that any information set forth in such form is inaccurate), the
Indenture Trustee shall withhold only the amount, if any, required by law (after
taking into account any applicable exemptions claimed by the Note Holder) to be
withheld from payments hereunder or under the Equipment Notes held by such
Holder in respect of United States federal income tax (and such withholding
shall constitute payment in respect of such Equipment Note). If a Note Holder
(x) which is a Non-U.S. Person has furnished to the Indenture Trustee a properly
completed and currently effective U.S. Internal Revenue Service Form 4224 in
duplicate (or such successor certificate, form or forms as may be required by
the United States Treasury Department as necessary in order to avoid withholding
of United States federal income tax), during the calendar year in which the
payment is made (but prior to the making of such payment) or in either of the
two preceding calendar years, and has not notified the Indenture Trustee of the
withdrawal or inaccuracy of such certificate or form prior to the date of such
payment (and the Indenture Trustee has no reason to know that any information
set forth in such form is inaccurate) or (y) which is a U.S. Person has
furnished to the Indenture Trustee a properly completed and currently effective
U.S. Internal Revenue Service Form W-9, if applicable, prior to a payment
hereunder or under the Equipment Notes held by such Holder, no amount shall be
withheld from payments in respect of United States federal income tax. If any
Note Holder has notified the Indenture Trustee that any of the foregoing forms
or certificates is withdrawn or inaccurate, or if such Holder has not filed a
form claiming an exemption from United States withholding tax or if the Code or
the regulations thereunder or the administrative interpretation thereof are at
any time after the date hereof amended to require such withholding of United
States federal income taxes from payments under the Equipment Notes held by such
Holder, the Indenture Trustee agrees to withhold from each payment due to the
relevant Note Holder withholding taxes at the appropriate rate under law (and
such withholding shall constitute payment in respect of such Equipment Notes)
and will, on a timely basis as more fully provided above, deposit such amounts
with an authorized depository and make such returns, statements, receipts and
other documentary evidence in connection therewith as required by applicable
law.
None of the Owner Trustee, the Owner Participant or the Lessee
shall have any liability for the failure of the Indenture Trustee to withhold
taxes in the manner provided for herein or for any false, inaccurate or untrue
evidence provided by a Holder hereunder.
SECTION 2.05. Application of Payments. In the case of
each Equipment Note, each payment of Principal Amount, Make-Whole
Trust Indenture
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Amount, if any, and interest or other amounts due thereon shall be applied:
First: to the payment of accrued interest on such Equipment
Note (as well as any interest on any overdue Principal Amount, any
overdue Make-Whole Amount, if any, and, to the extent permitted by law,
any overdue interest and any other overdue amounts thereunder) to the
date of such payment;
Second: to the payment of the Principal Amount of such
Equipment Note (or a portion thereof) then due thereunder;
Third: to the payment of Make-Whole Amount, if any,
and any other amount due hereunder or under such Equipment
Note; and
Fourth: the balance, if any, remaining thereafter, to the
payment of the Principal Amount of such Equipment Note remaining unpaid
(provided that such Equipment Note shall not be subject to redemption
except as provided in Sections 2.10 and 2.11 hereof).
The amounts paid pursuant to clause "Fourth" above shall be applied to the
installments of Principal Amount of such Equipment Note in the inverse order of
their normal maturity.
SECTION 2.06. Termination of Interest in Trust Indenture
Estate. A Note Holder shall not, as such, have any further interest in, or other
right with respect to, the Trust Indenture Estate when the Principal Amount of,
Make-Whole Amount, if any, and interest on and other amounts due under all
Equipment Notes held by such Note Holder and all other sums then payable to such
Note Holder hereunder and under the Lease and the Refunding Agreement by the
Lessee, the Owner Participant and the Owner Trustee (collectively, the "Secured
Obligations") shall have been paid in full.
SECTION 2.07. Registration, Transfer and Exchange of Equipment
Notes. The Indenture Trustee shall keep a register (the "Register") in which the
Indenture Trustee shall provide for the registration of Equipment Notes and the
registration of transfers of Equipment Notes. No such transfer shall be given
effect unless and until registration hereunder shall have occurred. The Register
shall be kept at the Corporate Trust Office of the Indenture Trustee. The
Indenture Trustee is hereby appointed "Registrar" for the purpose of registering
Equipment Notes and transfers of Equipment Notes as herein provided. A Holder of
any Equipment Note intending to exchange such Equipment Note shall surrender
such Equipment Note to the Indenture Trustee at the Corporate Trust Office,
together with a written request
Trust Indenture
40
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from the registered Holder thereof for the issuance of a new Equipment Note,
specifying, in the case of a surrender for transfer, the name and address of the
new Holder or Holders. Upon surrender for registration of transfer of any
Equipment Note, the Owner Trustee shall execute, and the Indenture Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Equipment Notes of a like aggregate unpaid portion
of the Principal Amount and of the same series. At the option of the Note
Holder, Equipment Notes may be exchanged for other Equipment Notes of any
authorized denominations of a like aggregate unpaid portion of the Principal
Amount, upon surrender of the Equipment Notes to be exchanged to the Indenture
Trustee at the Corporate Trust Office. Whenever any Equipment Notes are so
surrendered for exchange, the Owner Trustee shall execute, and the Indenture
Trustee shall authenticate and deliver, the Equipment Notes which the Note
Holder making the exchange is entitled to receive. All Equipment Notes issued
upon any registration of transfer or exchange of Equipment Notes (whether under
this Section 2.07 or under Section 2.08 hereof or otherwise under this
Indenture) shall be the valid obligations of the Owner Trustee evidencing the
same respective obligations, and entitled to the same security and benefits
under this Indenture, as the Equipment Notes surrendered upon such registration
of transfer or exchange. Every Equipment Note presented or surrendered for
registration of transfer or exchange shall (if so required by the Indenture
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Indenture Trustee duly executed by the Note Holder
or such Holder's attorney duly authorized in writing, and the Indenture Trustee
shall require evidence satisfactory to it as to the compliance of any such
transfer with the Securities Act and the securities laws of any applicable
state. The Indenture Trustee shall make a notation on each new Equipment Note of
the amount of all payments of Principal Amount previously made on the old
Equipment Note or Equipment Notes with respect to which such new Equipment Note
is issued and the date to which interest on such old Equipment Note or Equipment
Notes has been paid. Interest shall be deemed to have been paid on such new
Equipment Note to the date on which interest shall have been paid on such old
Equipment Note, and all payments of the Principal Amount marked on such new
Equipment Note, as provided above, shall be deemed to have been made thereon.
Neither the Indenture Trustee nor the Owner Trustee shall be required to
exchange any surrendered Equipment Notes as provided above during the ten-day
period preceding the Payment Date. The Indenture Trustee will promptly notify
the Owner Trustee, the Owner Participant and Lessee of each registration of a
transfer of an Equipment Note. Any such transferee of an Equipment Note, by its
acceptance of an Equipment Note, agrees to the provisions of the Refunding
Agreement applicable to Note Holders, and shall be deemed to have represented
and warranted to the parties to the Refunding
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Agreement as to the matters represented and warranted by the Subordination Agent
in its capacity as the initial Holder of the Equipment Notes. Subject to
compliance by the Note Holder and its transferee (if any) of the requirements
set forth in this Section 2.07, the Indenture Trustee and the Owner Trustee
shall use all reasonable efforts to issue new Equipment Notes upon transfer or
exchange within 10 Business Days of the date an Equipment Note is surrendered
for transfer or exchange.
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Equipment
Notes. If any Equipment Note shall become mutilated, destroyed, lost or stolen,
the Owner Trustee shall, upon the written request of the Holder of such
Equipment Note, execute and the Indenture Trustee shall authenticate and deliver
in replacement thereof a new Equipment Note, payable in the same Principal
Amount dated the same date and captioned as originally issued. If the Equipment
Note being replaced has become mutilated, such Equipment Note shall be
surrendered to the Indenture Trustee and a copy thereof shall be furnished to
the Owner Trustee. If the Equipment Note being replaced has been destroyed, lost
or stolen, the Holder of such Equipment Note shall furnish to the Lessee, the
Owner Trustee, the Owner Participant and the Indenture Trustee such security or
indemnity as may be reasonably required by them to save the Lessee, the Owner
Trustee, the Owner Participant and the Indenture Trustee harmless and evidence
satisfactory to the Lessee, the Owner Trustee, the Owner Participant and the
Indenture Trustee of the destruction, loss or theft of such Equipment Note and
of the ownership thereof. If a bank or trust company with a net worth of
$200,000,000 or more is the Holder of any such destroyed, lost or stolen
Equipment Note, then the written indemnity of such Person, signed by an
authorized officer thereof, in favor of, delivered to and in form reasonably
satisfactory to the Lessee, the Owner Participant, the Owner Trustee and the
Indenture Trustee shall be accepted as satisfactory indemnity and security and
no further indemnity or security shall be required as a condition to the
execution and delivery of such new Equipment Note. Subject to compliance by the
Note Holder of the requirements set forth in this Section 2.08, the Indenture
Trustee and the Owner Trustee shall use all reasonable efforts to issue new
Equipment Notes within 10 Business Days of the date of the written request
therefor from the Note Holder.
SECTION 2.09. Payment of Expenses on Transfer; Cancellation.
(a) No service charge shall be made to a Note Holder for any registration of
transfer or exchange of Equipment Notes, but the Indenture Trustee, as
Registrar, may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Equipment Notes; provided, however, that none of the
Lessee, the Owner Trustee,
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the Indenture Trustee or the Owner Participant shall bear costs of registration,
transfer or exchange in connection with the consummation of the Refinancing
Transaction.
(b) The Indenture Trustee shall cancel all Equipment Notes
surrendered for replacement, redemption, transfer, exchange, payment or
cancellation and shall destroy the canceled Equipment Notes.
SECTION 2.10. Mandatory Redemptions of Equipment Notes. The
Equipment Notes are subject to redemption as provided in this Section 2.10 and
Section 2.11 and purchase as provided in Section 2.12. On the date on which
Lessee is required pursuant to Section 11(a) of the Lease to make payment for an
Event of Loss with respect to the Aircraft, all of the Equipment Notes shall be
redeemed in whole at a redemption price equal to 100% of the unpaid Principal
Amount thereof, together with all accrued interest thereon to, but not
including, the date of redemption and all other amounts payable hereunder or
under the Refunding Agreement to the Note Holders but without Make-Whole Amount,
all in the order of priority specified in Section 3.02 hereof.
SECTION 2.11. Redemptions; Notice of Redemption. (a) Neither
any redemption of any Equipment Note nor any purchase by the Owner Trustee of
any Equipment Note may be made except to the extent and in the manner expressly
permitted by this Indenture. No purchase of any Equipment Note may be made by
the Indenture Trustee.
(b) Notice of redemption or purchase with respect to the
Equipment Notes shall be given by the Indenture Trustee by first-class mail,
postage prepaid, mailed not less than 15 nor more than 60 days prior to the
applicable redemption date, to each Note Holder of such Equipment Notes to be
redeemed or purchased, at such Note Holder's address appearing in the Register.
All notices of redemption or purchase shall state: (1) the redemption date, (2)
the applicable basis for determining the redemption price, (3) that on the
redemption date, the redemption price will become due and payable upon each such
Equipment Note, and that interest on such Equipment Notes shall cease to accrue
on and after such redemption date, and (4) the place or places where such
Equipment Notes are to be surrendered for payment of the redemption price.
(c) On or before the redemption date, the Owner Trustee (or
any Person on behalf of the Owner Trustee) shall, to the extent an amount equal
to the redemption price for the Equipment Notes to be redeemed or purchased on
the redemption date shall not then be held in the Trust Indenture Estate,
deposit or cause to be deposited with the Indenture Trustee by 12:00 noon, New
York City time, on the redemption date in
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immediately available funds the redemption price of the Equipment
Notes to be redeemed or purchased.
(d) Notice of redemption or purchase having been given as
aforesaid, the Equipment Notes to be redeemed or purchased shall, on the
redemption date, become due and payable at the Corporate Trust Office of the
Indenture Trustee, and from and after such redemption date (unless there shall
be a default in the payment of the redemption price) any such Equipment Notes
then outstanding shall cease to bear interest. Upon surrender of any such
Equipment Note for redemption or purchase in accordance with said notice, such
Equipment Note shall be redeemed at the redemption price. If any Equipment Note
called for redemption or purchase shall not be so paid upon surrender thereof
for redemption, the principal amount thereof shall, until paid, continue to bear
interest from the applicable redemption date at the interest rate in effect for
such Equipment Note as of such redemption date.
SECTION 2.12. Option to Purchase Equipment Notes. Either the
Owner Trustee or the Owner Participant may, upon the events and subject to the
terms and conditions and for the price set forth in this Section 2.12, purchase
all but not less than all of the Equipment Notes outstanding hereunder, and each
Note Holder agrees that it will, upon such events and subject to such terms and
conditions and upon receipt of such price, sell, assign, transfer and convey to
such purchaser or its nominee (without recourse or warranty of any kind except
as to its title to the Equipment Notes and except against Liens on such
Equipment Notes arising by, through or under such Holder), all of the right,
title and interest of such Note Holder in and to the Trust Indenture Estate,
this Indenture and the Equipment Notes held by it, and such purchaser or its
nominee shall assume all of such Holder's obligations under the Refunding
Agreement and hereunder.
Such option to purchase the Equipment Notes may be exercised
by the Owner Trustee or the Owner Participant upon any of the following events,
and, in any such event, the purchase price thereof shall equal for each
Equipment Note the aggregate unpaid Principal Amount thereof, plus accrued and
unpaid interest thereon to, but not including, the date of purchase and all
other amounts (other than the Make-Whole Amount, except as provided in the next
sentence) then payable hereunder or under the Refunding Agreement to the Holder
thereof. Such option to purchase the Equipment Notes may be exercised: (i) upon
an Indenture Trustee Event or (ii) in the event there shall have occurred and be
continuing a Lease Event of Default, provided that if such option is exercised
pursuant to this clause (ii) at a time when there shall have occurred and be
continuing for less than 120 days a Lease Event of Default (and there is no
Indenture Trustee Event), the purchase price thereof shall equal the price
provided in the
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preceding sentence plus the Make-Whole Amount, if any; provided further, that
under no circumstances shall the Make-Whole Amount be payable by the Lessee.
Such option to purchase the Equipment Notes may be exercised
by the Owner Trustee or the Owner Participant giving written notice of its
election of such option to the Indenture Trustee, which notice shall specify a
date for such purchase not more than 30 days or less than 15 days after the date
of such notice. The Indenture Trustee shall not exercise any of the remedies
hereunder or, without the consent of the Owner Trustee or the Owner Participant,
under the Lease, during the period from the time that a notice of exercise by
the Owner Participant of such option to purchase becomes irrevocable until the
date on which such purchase is required to occur pursuant to the terms of the
preceding sentence. Such election to purchase the Equipment Notes shall become
irrevocable upon the fifteenth day preceding the date specified in the written
notice described in the first sentence of this paragraph.
If the Owner Trustee or the Owner Participant on or before the
date of such purchase shall so request, the Note Holders will comply with all
the provisions of Section 2.07 to enable new Equipment Notes to be issued to the
Owner Trustee or the Owner Participant or its nominee in such denominations as
the Owner Trustee or the Owner Participant shall request. All taxes and charges
required pursuant to Section 2.09 in connection with the issuance of such new
Equipment Note shall be borne by the Owner Participant.
SECTION 2.13. Subordination. (a) The Owner Trustee and, by
acceptance of its Equipment Notes of any Series, each Note Holder of such
Series, hereby agree that no payment or distribution shall be made on or in
respect of the Secured Obligations owed to such Note Holder of such Series,
including any payment or distribution of cash, property or securities after the
commencement of a proceeding of the type referred to in Section 4.02(g), (h) or
(i) hereof, except as expressly provided in Articles II and III hereof.
(b) By the acceptance of its Equipment Notes of any Series
(other than Series A), each Note Holder of such Series agrees that in the event
that such Note Holder, in its capacity as a Note Holder, shall receive any
payment or distribution on any Secured Obligations in respect of such Series
which it is not entitled to receive under this Section 2.13 or Article III
hereof, it will hold any amount so received in trust for the Senior Holder or
Senior Holders (as defined in Section 2.13(c) hereof) and will forthwith turn
over such payment to the Indenture Trustee in the form received to be applied as
provided in Articles II and III hereof.
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(c) As used in this Section 2.13, the term "Senior Holder" or
"Senior Holders" shall mean, (i) the Note Holders of Series A until the Secured
Obligations in respect of Series A Equipment Notes have been paid in full, (ii)
after the Secured Obligations in respect of Series A Equipment Notes have been
paid in full, the Note Holders of Series B until the Secured Obligations in
respect of Series B Equipment Notes have been paid in full, (iii) after the
Secured Obligations in respect of Series B Equipment Notes have been paid in
full, the Note Holders of Series C until the Secured Obligations in respect of
Series C Equipment Notes have been paid in full and (iv) after the Secured
Obligations in respect of Series C Equipment Notes have been paid in full, the
Note Holders of Series D until the Secured Obligations in respect of Series D
Equipment Notes have been paid in full.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Certain Rent Distributions. Except as otherwise
provided in Section 3.02 or 3.03 hereof, each installment of Basic Rent, any
payment of Supplemental Rent, any payment received by the Indenture Trustee as
contemplated by the first sentence of Section 4.03 hereof, and any payment
received by the Indenture Trustee pursuant to any Sublease Assignment as rent
under any Assigned Sublease shall be promptly distributed in the following order
of priority:
first, (i) so much of such installment or payment as shall be
required to pay in full the aggregate amount of the payment or payments
of Principal Amount, and interest and other amounts (as well as any
interest on overdue Principal Amount, and to the extent permitted by
applicable law, on any overdue interest and any other overdue amounts)
then due to the Note Holders under all Series A Equipment Notes shall
be distributed to the Note Holders of Series A ratably, without
priority of one over the other, in the proportion that the amount of
such payment or payments then due under each Series A Equipment Note
bears to the aggregate amount of the payments then due under all Series
A Equipment Notes;
(ii) after giving effect to clause (i) above, so much of such
installment or payment remaining as shall be required to pay in full
the aggregate amount of the payment or payments of Principal Amount and
interest and other amounts (as well as any interest on any overdue
Principal Amount and, to the extent permitted by applicable law, on any
overdue interest and any other overdue amounts) then due to the Note
Holders under all Series B Equipment Notes shall
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be distributed to the Note Holders of Series B ratably, without
priority of one over the other, in the proportion that the amount of
such payment or payments then due under each Series B Equipment Note
bears to the aggregate amount of the payments then due under all Series
B Equipment Notes;
(iii) after giving effect to clause (ii) above, so much of such
installment or payment remaining as shall be required to pay in full
the aggregate amount of the payment or payments of Principal Amount and
interest and other amounts (as well as any interest on any overdue
Principal Amount and, to the extent permitted by applicable law, on any
overdue interest and any other overdue amounts) then due to the Note
Holders under all Series C Equipment Notes shall be distributed to the
Note Holders of Series C ratably, without priority of one over the
other, in the proportion that the amount of such payment or payments
then due under each Series C Equipment Note bears to the aggregate
amount of the payments then due under all Series C Equipment Notes;
(iv) after giving effect to clause (iii) above, so much of such
installment or payment remaining as shall be required to pay in full
the aggregate amount of the payment or payments of Principal Amount and
interest and other amounts (as well as any interest on any overdue
Principal Amount and, to the extent permitted by applicable law, on any
overdue interest and any other overdue amounts) then due to the Note
Holders under all Series D Equipment Notes shall be distributed to the
Note Holders of Series D ratably, without priority of one over the
other, in the proportion that the amount of such payment or payments
then due under each Series D Equipment Note bears to the aggregate
amount of the payments then due under all Series D Equipment Notes; and
(v) after giving effect to clause (iv) above, so much of such
installment or payment remaining as shall be required to pay in full
the aggregate amount of the payment or payments of Principal Amount and
interest and other amounts (as well as any interest on any overdue
Principal Amount and, to the extent permitted by applicable law, on any
overdue interest and any other overdue amounts) then due to the Note
Holders under all Series E Equipment Notes shall be distributed to the
Note Holders of Series E ratably, without priority of one over the
other, in the proportion that the amount of such payment or payments
then due under each Series E Equipment Note bears to the aggregate
amount of the payments then due under all Series E Equipment Notes; and
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second, the balance, if any, of such installment or payment
remaining thereafter shall be distributed to the Owner Trustee for
distribution pursuant to the Trust Agreement; provided, however, that
if an Indenture Default shall have occurred and be continuing, then
such balance shall not be distributed as provided in this clause
"second" but shall be held by the Indenture Trustee as part of the
Trust Indenture Estate and invested in accordance with Section 3.07
hereof until whichever of the following shall first occur: (i) all
Indenture Defaults shall have been cured or waived, in which event such
balance shall be distributed as provided in this clause "second", or
(ii) Section 3.03 hereof shall be applicable, in which event such
balance shall be distributed in accordance with the provisions of said
Section 3.03, or (iii) the 180th day after receipt of such payment, in
which event such balance shall be distributed as provided in this
clause "second" without reference to this proviso.
SECTION 3.02. Event of Loss and Replacement. (a) Any payment
received by the Indenture Trustee with respect to the Airframe or the Airframe
and one or both Engines as the result of an Event of Loss thereto shall be
applied to the redemption of the Equipment Notes and to all other amounts
payable hereunder by applying such funds in the following order of priority:
first, to reimburse the Indenture Trustee for any reasonable
out-of-pocket costs or expenses incurred in connection with such Event
of Loss,
second, to pay in full the aggregate amount of the payment or
payments of unpaid Principal Amount, and unpaid interest and other
amounts (as well as any interest on overdue Principal Amount, and to
the extent permitted by applicable law, on any overdue interest and any
other overdue amounts) then due to the Note Holders under all Equipment
Notes, all in the order of priority specified in clause "first" of
Section 3.01 hereof, and
third, if and to the extent required to be paid to the Lessee
(or if directed by the Lessee, any Permitted Sublessee) in
reimbursement of payment of Stipulated Loss Value pursuant to Section
11(d) of the Lease, to the Lessee (or if directed by the Lessee, any
Permitted Sublessee), and otherwise as provided in clause "fourth" of
Section 3.03 hereof;
provided that, if a Replacement Airframe or a Replacement Airframe and one or
more Replacement Engines are to be substituted for the Airframe or the Airframe
and one or both Engines subject to such Event of Loss as provided in Section 11
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of the Lease and Section 5.06 hereof, any proceeds which result from such Event
of Loss and are paid to the Indenture Trustee shall be held by the Indenture
Trustee as part of the Trust Indenture Estate as security for the obligations of
the Lessee under the Operative Documents and invested in accordance with the
terms of Section 3.07 hereof and, unless theretofore applied in accordance with
the provisions of the Lease and this Indenture, such proceeds shall, to the
extent payable to the Lessee under the Lease, be released to the Lessee (or if
directed by the Lessee, any Permitted Sublessee) upon or in connection with the
replacement thereof as provided in such Sections.
(b) Any amounts received directly or indirectly from any
governmental authority or insurer or other party pursuant to any provision of
Section 11 or 12 of the Lease (other than as the result of an Event of Loss with
respect to the Airframe or the Airframe and one or both Engines) shall be
applied as provided in the applicable provisions of the Lease; provided,
however, that to the extent that any portion of such amounts held for account of
the Lessee are not at the time required to be paid to the Lessee (or any
Permitted Sublessee) pursuant to the applicable provisions of Section 11 or 12
of the Lease, shall be held by the Indenture Trustee as security for the
obligations of the Lessee under the Operative Documents and shall be invested in
accordance with the terms of Section 3.07 hereof and at such time as the
conditions specified in the Lease for payment of such amounts to the Lessee
shall be fulfilled, such portion, and the net proceeds of any investment
thereof, shall, unless theretofore applied in accordance with the provisions of
the Lease and this Indenture, be paid to the Lessee to the extent provided in
the Lease.
SECTION 3.03. Payment After Indenture Event of Default, etc.
Except as otherwise provided in Sections 2.13, 3.02, 3.04(a) and (c) and 6.07
hereof, and notwithstanding Section 2.05 hereof, all payments received and
amounts held or realized by the Indenture Trustee after an Indenture Event of
Default shall have occurred and be continuing or after the Indenture Trustee has
given notice to the Owner Trustee and the Owner Participant pursuant to Section
4.04(a) hereof regarding its exercise of remedies under Section 18 of the Lease
or of the foreclosure of this Indenture, or after the Equipment Notes shall have
become due and payable as provided herein, and all payments or amounts then held
by the Indenture Trustee as part of the Trust Indenture Estate, shall, so long
as such Indenture Event of Default shall be continuing, be promptly distributed
by the Indenture Trustee in the following order of priority, without
duplication:
first, so much of such payments or amounts as shall be
required to reimburse the Indenture Trustee for all amounts due to it
pursuant to Section 6.07 hereof, plus any tax,
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expense, charge or other loss (including, without limitation, all
amounts to be expended at the expense of, or charged upon the tolls,
rents, revenues, issues, products and profits of, the property included
in the Trust Indenture Estate pursuant to Section 4.05(b) hereof)
incurred by the Indenture Trustee (to the extent not previously
reimbursed) (including, without limitation, the expenses of any sale,
taking or other proceeding, reasonable attorneys' fees and expenses,
court costs, and any other expenditures incurred or expenditures or
advances made by the Indenture Trustee in the protection, exercise or
enforcement of any right, power or remedy or any damages sustained by
the Indenture Trustee, liquidated or otherwise, upon such Indenture
Event of Default) shall be applied by the Indenture Trustee in
reimbursement of such expenses;
second, so much of such payments or amounts remaining as shall
be required to reimburse the then existing or prior Note Holders for
payments made pursuant to Section 5.03 hereof (to the extent not
previously reimbursed) shall be distributed to the then existing or
prior Note Holders, and if the aggregate amount remaining shall be
insufficient to pay all such amounts in full, it shall be distributed
ratably, without priority of one over any other, in accordance with the
amount of the payment or payments made by each such then existing or
prior Note Holder pursuant to said Section 5.03 and applicable (in the
case of each such then existing Note Holder) to the Equipment Notes
held by such existing Note Holder at the time of distribution by the
Indenture Trustee;
third, (i) so much of such payments or amounts remaining as
shall be required to pay in full the aggregate unpaid Principal Amount
of all Series A Equipment Notes, and the accrued but unpaid interest
and other amounts due thereon and all other Secured Obligations in
respect of the Series A Equipment Notes (other than Make-Whole Amount,
if any) to the date of distribution, shall be distributed to the Note
Holders of Series A, and in case the aggregate amount so to be
distributed shall be insufficient to pay in full as aforesaid, then
ratably, without priority of one over the other, in the proportion that
the aggregate unpaid Principal Amount of all Series A Equipment Notes
held by each Holder plus the accrued but unpaid interest and other
amounts due hereunder or thereunder (other than Make-Whole Amount, if
any) to the date of distribution, bears to the aggregate unpaid
Principal Amount of all Series A Equipment Notes held by all such
Holders plus the accrued but unpaid interest and other amounts due
thereon to the date of distribution;
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(ii) after giving effect to paragraph (i) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series B Equipment Notes, and
the accrued but unpaid interest and other amounts due thereon and all
other Secured Obligations in respect of the Series B Equipment Notes
(other than Make-Whole Amount, if any) to the date of distribution,
shall be distributed to the Note Holders of Series B, and in case the
aggregate amount so to be distributed shall be insufficient to pay in
full as aforesaid, then ratably, without priority of one over the
other, in the proportion that the aggregate unpaid Principal Amount of
all Series B Equipment Notes held by each Holder plus the accrued but
unpaid interest and other amounts due hereunder or thereunder (other
than Make-Whole Amount, if any) to the date of distribution, bears to
the aggregate unpaid Principal Amount of all Series B Equipment Notes
held by all such Holders plus the accrued but unpaid interest and other
amounts due thereon to the date of distribution;
(iii) after giving effect to paragraph (ii) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series C Equipment Notes, and
the accrued but unpaid interest and other amounts due thereon and all
other Secured Obligations in respect of the Series C Equipment Notes
(other than Make-Whole Amount, if any) to the date of distribution,
shall be distributed to the Note Holders of Series C, and in case the
aggregate amount so to be distributed shall be insufficient to pay in
full as aforesaid, then ratably, without priority of one over the
other, in the proportion that the aggregate unpaid Principal Amount of
all Series C Equipment Notes held by each Holder plus the accrued but
unpaid interest and other amounts due hereunder or thereunder (other
than Make-Whole Amount, if any) to the date of distribution, bears to
the aggregate unpaid Principal Amount of all Series C Equipment Notes
held by all such Holders plus the accrued but unpaid interest and other
amounts due thereon to the date of distribution;
(iv) after giving effect to paragraph (iii) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series D Equipment Notes, and
the accrued but unpaid interest and other amounts due thereon and all
other Secured Obligations in respect of the Series D Equipment Notes
(other than Make-Whole Amount, if any) to the date of distribution,
shall be distributed to the Note Holders of Series D, and in case the
aggregate amount so to be distributed shall be insufficient to pay in
full as aforesaid, then ratably, without priority of one over the
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other, in the proportion that the aggregate unpaid Principal Amount of
all Series D Equipment Notes held by each Holder plus the accrued but
unpaid interest and other amounts due hereunder or thereunder (other
than Make-Whole Amount, if any) to the date of distribution, bears to
the aggregate unpaid Principal Amount of all Series D Equipment Notes
held by all such Holders plus the accrued but unpaid interest and other
amounts due thereon to the date of distribution; and
(v) after giving effect to paragraph (iv) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series E Equipment Notes, and
the accrued but unpaid interest and other amounts due thereon and all
other Secured Obligations in respect of the Series E Equipment Notes
(other than Make-Whole Amount, if any) to the date of distribution,
shall be distributed to the Note Holders of Series E, and in case the
aggregate amount so to be distributed shall be insufficient to pay in
full as aforesaid, then ratably, without priority of one over the
other, in the proportion that the aggregate unpaid Principal Amount of
all Series E Equipment Notes held by each holder plus the accrued but
unpaid interest and other amounts due hereunder and thereunder (other
than Make-Whole Amount, if any) to the date of distribution, bears to
the aggregate unpaid Principal Amount of all Series E Equipment Notes
held by all such holders plus the accrued but unpaid interest and other
amounts due thereon to the date of distribution; and
fourth, the balance, if any, of such payments or amounts remaining
thereafter shall be distributed to the Owner Trustee for distribution pursuant
to the Trust Agreement and the Lease.
No Make-Whole Amount shall be due and payable on the Equipment
Notes as a consequence of the acceleration of the Equipment Notes.
SECTION 3.04. Certain Payments. (a) Any payments received by
the Indenture Trustee for which provision as to the application thereof is made
in the Lease shall be applied forthwith to the purpose for which such payment
was made in accordance with or as otherwise provided by the terms of the Lease.
(b) The Indenture Trustee will distribute promptly upon
receipt any indemnity payment received by it from the Owner Trustee or the
Lessee in respect of (i) the Indenture Trustee in its individual capacity, (ii)
any Pass Through Trust, (iii) the Subordination Agent, (iv) the Liquidity
Providers, and (v) the Pass Through Trustees, in each case whether pursuant to
Section 10 or 13 of the Lease or Section 21 of the Refunding Agreement or
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as Supplemental Rent, directly to the Person entitled thereto. Any payment
received by the Indenture Trustee under clause (b) of the fourth paragraph of
Section 2.02 shall be distributed to the Subordination Agent to be distributed
in accordance with the terms of the Intercreditor Agreement, and any payment
received by the Indenture Trustee under clause (c) of the fourth paragraph of
Section 2.02 shall be distributed directly to the Persons entitled thereto.
(c) Notwithstanding anything to the contrary contained in this
Article III, any sums received by the Indenture Trustee that constitute Excepted
Payments shall be distributed promptly upon receipt by the Indenture Trustee
directly to the Person or Persons entitled thereto. Further, and notwithstanding
anything herein to the contrary, any sums received by the Indenture Trustee
under the Lease or any Sublease Assignment as security for the obligations of
the Lessee or the relevant Permitted Sublessee under the Operative Documents
shall be applied only to such obligations or as otherwise provided in the Lease.
SECTION 3.05. Other Payments. Subject to Sections 3.03 and
3.04 hereof, any payments received by the Indenture Trustee for which no
provision as to the application thereof is made elsewhere in this Indenture
shall be distributed by the Indenture Trustee, unless otherwise agreed in
writing, subject to Section 6.07 hereof (i) to the extent received or realized
at any time prior to the payment in full of all obligations to the Note Holders
secured by the Lien of this Indenture, in the order of priority specified in
Section 3.01 hereof, and (ii) to the extent received or realized at any time
after payment in full of all obligations to the Note Holders secured by the Lien
of this Indenture, in the following order of priority:
first, to the extent payments or amounts described in clause
"first" of Section 3.03 hereof are otherwise obligations of Lessee
under the Operative Documents or for which Lessee is obligated to
indemnify against thereunder, in the manner provided in clause "first"
of Section 3.03 hereof, and
second, in the manner provided in clause "fourth" of
Section 3.03 hereof.
SECTION 3.06. Payments to Owner Trustee. Any amounts
distributed hereunder by the Indenture Trustee to the Owner Trustee shall be
paid to the Owner Trustee by wire transfer of funds of the type received by the
Indenture Trustee at such office and to such account or accounts of such entity
or entities as shall be designated by notice from the Owner Trustee to the
Indenture Trustee from time to time. The Owner Trustee hereby notifies the
Indenture Trustee that unless and until the
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Indenture Trustee receives notice to the contrary from the Owner Trustee, all
amounts to be distributed to the Owner Trustee pursuant to clause "second" of
Section 3.01 hereof shall be distributed by wire transfer of funds of the type
received by the Indenture Trustee to the Owner Participant's account as may be
specified pursuant to the Refunding Agreement.
SECTION 3.07. Investment of Amounts Held by Indenture Trustee.
Any amounts held by the Indenture Trustee as assignee of the Owner Trustee's
rights to hold moneys for security pursuant to Section 21(h) of the Lease shall
be held in accordance with the terms of such Section; and the Indenture Trustee
hereby agrees to perform the duties of the Owner Trustee under such Section.
Except as provided in the preceding sentence, any amounts held by the Indenture
Trustee pursuant to the proviso to clause "second" of Section 3.01 hereof,
pursuant to Section 3.02 hereof, pursuant to the second sentence of Section
3.04(c) hereof, pursuant to the fourth sentence of Section 4.03 hereof, pursuant
to a Sublease Assignment, or pursuant to any provision of any other Operative
Document providing for amounts to be held by the Indenture Trustee which are not
distributed pursuant to the other provisions of Article III hereof shall be
invested by the Indenture Trustee from time to time in Specified Investments
selected in writing in a timely manner by the Owner Trustee or, in the event the
Owner Trustee shall so specify, by the Lessee. Unless otherwise expressly
provided in this Indenture or the Lease, any income realized as a result of any
such investment and any payments by or on behalf of the Lessee pursuant to the
Lease in respect of any losses or expenses, net of the Indenture Trustee's
reasonable fees and expenses in making such investment, shall be held and
applied by the Indenture Trustee in the same manner as the principal amount of
such investment is to be applied and any losses, net of earnings and such
reasonable fees and expenses, shall be charged against the principal amount
invested. The Indenture Trustee shall not be liable for any loss resulting from
any investment required to be made by it under this Indenture other than by
reason of its willful misconduct or gross negligence, and any such investment
may be sold (without regard to its maturity) by the Indenture Trustee without
instructions whenever the Indenture Trustee reasonably believes such sale is
necessary to make a distribution required by this Indenture.
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ARTICLE IV
COVENANTS OF TRUST COMPANY AND OWNER
TRUSTEE; INDENTURE EVENTS OF DEFAULT;
REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of Trust Company and Owner Trustee.
(a) The Trust Company hereby covenants and agrees that it will not directly or
indirectly create, incur, assume or suffer to exist any Lessor's Lien
attributable to it in its individual capacity with respect to any of the
properties or assets of the Trust Indenture Estate and shall, at its own cost
and expense promptly take such action as may be necessary duly to discharge any
such Lessor's Lien, and the Trust Company will cause restitution to be made to
the Trust Indenture Estate in the amount of any diminution of the value thereof
as the result of any Lessor's Liens attributable to it.
(b) The Owner Trustee hereby covenants and agrees as
follows:
(i) the Owner Trustee will duly and punctually pay the
Principal Amount of, Make-Whole Amount, if any, and interest on and
other amounts due under the Equipment Notes and hereunder in accordance
with the terms of the Equipment Notes and this Indenture and all
amounts payable by it to the Note Holders under the Refunding Agreement
and the other Operative Documents;
(ii) the Owner Trustee will not directly or indirectly create,
incur, assume or suffer to exist any Lessor's Liens attributable to it
with respect to any of the properties or assets of the Trust Indenture
Estate, and shall, at its own cost and expense, promptly take such
action as may be necessary duly to discharge any such Lessor's Lien,
and the Owner Trustee will cause restitution to be made to the Trust
Indenture Estate in the amount of any diminution of the value thereof
as the result of any Lessor's Liens attributable to it;
(iii) in the event an officer with responsibility for or familiarity
with the transactions contemplated hereunder or under the other
Operative Documents (or any Vice President) in the Corporate Trust
Administration Department of the Owner Trustee shall have actual
knowledge of an Indenture Default or an Event of Loss, the Owner
Trustee will give prompt written notice of such Indenture Default or
Event of Loss to the Indenture Trustee, the Lessee and the Owner
Participant;
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(iv) the Owner Trustee will furnish to the Indenture Trustee,
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,
including, without limitation, a copy of each report or notice received
pursuant to Section 12(f) of the Lease, to the extent that the same
shall not have been furnished, or is not required to be furnished by
the Lessee, to the Indenture Trustee pursuant to the Lease or
otherwise;
(v) except as contemplated by the Operative Documents or with the
consent of the Indenture Trustee acting in accordance with Article IX
hereof, the Owner Trustee will not incur any indebtedness for borrowed
money; and
(vi) the Owner Trustee will not enter into any business or other
activity other than the business of owning the Aircraft, the leasing
thereof to the Lessee and the carrying out of the transactions
contemplated hereby and by the Lease, the Refunding Agreement, the
Trust Agreement and the other Operative Documents.
SECTION 4.02. Indenture Events of Default. "Indenture Event of
Default" means any of the following events (whatever the reason for such
Indenture Event of Default and whether such event shall be voluntary or
involuntary or come about or be effected by operation of law or pursuant to or
in compliance with any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body):
(a) any Lease Event of Default shall occur and be continuing
(other than a failure to pay when due any amount in respect of Excepted
Payments); or
(b) the failure of the Owner Trustee to pay when due any
payment of Principal Amount of, or interest on, any Equipment Note
(other than as a result of a Lease Default) and such failure shall have
continued unremedied for ten calendar days; or the failure of the Owner
Trustee to pay when due any other amount due and payable under any
Equipment Note or hereunder (other than as a result of a Lease Default)
and such failure shall have continued unremedied for 15 calendar days
after notice thereof being given to the Owner Trustee from the
Indenture Trustee or any Note Holder; or
(c) any Lessor's Lien required to be discharged by the Trust
Company pursuant to Section 4.01(a) hereof or Section 13 of the
Refunding Agreement or by the Owner Trustee as the Owner Trustee
pursuant to Section 4.01(b)(ii) hereof or
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Section 13 of the Refunding Agreement or any Lessor's Lien required to
be discharged by the Owner Participant pursuant to Section 13 of the
Refunding Agreement shall remain undischarged for a period of 30
calendar days after, as the case may be, an officer with responsibility
for or familiarity with the transactions contemplated hereunder or
under the other Operative Documents (or any Vice President) in the
Corporate Trust Administration Department of the Trust Company or an
officer of the Owner Participant with responsibility for or familiarity
with the transactions contemplated hereunder and under the other
Operative Documents (or any Vice President) shall have actual knowledge
of such Lien; provided, that no Indenture Event of Default shall arise
under this Section 4.02(c) as a result of a failure by the Owner
Trustee or the Owner Participant to observe or perform any covenant
referred to in this Section 4.02(c) if the Lessee shall have discharged
all Lessor's Liens required to be discharged by the Owner Trustee or
the Owner Participant pursuant to such covenants and compensated the
Indenture Trustee and the Trust Indenture Estate for all claims, losses
and expenses arising from the failure of the Owner Trustee or the Owner
Participant, as the case may be, to observe and perform any such
covenant; or
(d) any representation or warranty made by the Owner
Participant, the Owner Trustee or the Trust Company herein or in the
Refunding Agreement or by any Person (if any) guaranteeing or
supporting the obligations of the Owner Participant under the Operative
Documents or in any related guarantee or support agreement shall prove
to have been false or incorrect when made in any respect materially
adverse to the rights and interests of the Note Holders; and if such
misrepresentation is capable of being corrected as of a subsequent date
and if such correction is being sought diligently, such
misrepresentation shall not have been corrected as of a day within 30
calendar days following notice thereof being given to the Owner
Participant, the Owner Trustee, the Trust Company or such Person (if
any), as the case may be, by the Indenture Trustee or a Majority in
Interest of Note Holders; or
(e) any failure of the Owner Trustee to observe or perform any
of its covenants or agreements in the fourth paragraph following the
Habendum Clause hereof or in clauses (b)(v) and (b)(vi) of Section 4.01
hereof, or any failure by the Owner Participant or the Trust Company to
observe or perform any of its respective covenants in Section 9(b)(11),
10 or 14 of the Refunding Agreement; or
(f) except as provided in the following paragraph (j), any
failure by the Owner Trustee or the Trust Company to
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observe or perform any other covenant or obligation of the Owner
Trustee contained in this Indenture or in the Refunding Agreement or
any failure by the Owner Participant to observe or perform any other
covenant or obligation of the Owner Participant contained in the
Refunding Agreement or any failure of any Person (if any) that may
guarantee or support the obligations of an Owner Participant not
originally party to the Refunding Agreement under the Operative
Documents to observe or perform any covenant or obligation of such
Person contained in any such guarantee or support agreement, which
failure, in any case and either individually or together with other
then existing failures, shall have a material adverse effect on the
rights and interests of the Indenture Trustee or any Note Holder and is
not remedied within a period of 45 calendar days following notice being
given to the Owner Trustee, the Owner Participant or such Person, as
the case may be, by the Indenture Trustee or a Majority in Interest of
Note Holders; or
(g) either the Trust Estate or the Owner Trustee with respect
thereto (and not in its individual capacity) or the Owner Participant
or any Person (if any) that may guarantee or support the obligations of
an Owner Participant not originally party to the Refunding Agreement
under the Operative Documents shall (i) be unable to pay its debts
generally as they become due within the meaning of the Bankruptcy Code,
(ii) file, or consent by answer or otherwise to the filing against it
of a petition for relief or reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, (iii) make an
assignment for the benefit of its creditors, (iv) consent to the
appointment of a custodian, receiver, trustee or other officer with
similar powers of itself or any substantial part of its property, or
(v) take corporate or comparable action for the purpose of any of the
foregoing; or
(h) a court or governmental authority of competent
jurisdiction shall enter an order appointing, without consent by the
Trust Estate or the Owner Trustee with respect thereto (and not in its
individual capacity) or the Owner Participant or any Person (if any)
that may guarantee or support the obligations of an Owner Participant
not originally party to the Refunding Agreement under the Operative
Documents, as the case may be, a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, or constituting an order for relief
or approving a petition for relief or reorganization or any other
petition in bankruptcy or for liquidation or to take advantage of any
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bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Trust Estate or the Owner
Trustee with respect thereto (and not in its individual capacity) or
the Owner Participant or such Person, as the case may be; or
(i) any petition for any relief specified in the foregoing
paragraph (h) shall be filed against the Trust Estate or the Owner
Trustee with respect thereto (and not in its individual capacity) or
the Owner Participant or any Person (if any) that may guarantee or
support the obligations of an Owner Participant not originally party to
the Refunding Agreement under the Operative Documents, as the case may
be, and such petition shall not be dismissed within 60 days; or
(j) at any time when the Aircraft shall be registered in a
jurisdiction outside the United States, the Owner Trustee, the Trust
Company or the Owner Participant shall breach any covenant as may be
agreed upon pursuant to Section 11 of the Refunding Agreement as the
result of which the Lien of this Indenture shall cease to be a valid
and duly perfected Lien on the Trust Indenture Estate.
SECTION 4.03. Certain Rights. In the event of any default by
the Lessee in the payment of any installment of Basic Rent due under the Lease,
the Owner Participant may, within ten calendar days (or such longer period
ending on the second day after the expiry of the applicable grace period
specified in the Lease with respect to such default) after notice from the
Indenture Trustee or the Lessee of such default, without the consent or
concurrence of any Note Holder, pay, as provided in Section 2.04 hereof, for
application in accordance with Section 3.01 hereof, a sum equal to the amount of
all (but not less than all) of the Principal Amount and interest as shall then
(without regard to any acceleration pursuant to Section 4.04(b) or (c) hereof)
be due and payable on the Equipment Notes. In the event of any default by the
Lessee in any obligation under the Lease other than the payment of Basic Rent,
if such default can be remedied by the payment of money and the Owner Trustee
shall have been furnished by the Owner Participant with all funds necessary for
remedying such default, the Owner Participant may, within fifteen calendar days
(or such longer period ending on the second day after the expiry of any
applicable grace period specified in the Lease with respect to such default)
after notice from the Indenture Trustee or the Lessee of such default, without
the consent or concurrence of any Note Holder, instruct the Owner Trustee to
exercise the Owner Trustee's rights under Section 21(d) of the Lease to perform
such obligation on behalf of the Lessee. Solely for the purpose of determining
whether there exists an Indenture Event of Default, (a) any timely payment by
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the Owner Participant pursuant to, and in compliance with, the first sentence of
this Section 4.03 shall be deemed to remedy (but solely for purposes of this
Indenture) any default by the Lessee in the payment of Basic Rent theretofore
due and payable and to remedy (but solely for purposes of this Indenture) any
default by the Owner Trustee in the payment of any amount due and payable under
the Equipment Notes or hereunder, and (b) any timely performance by the Owner
Trustee of any obligation of the Lessee under the Lease pursuant to, and in
compliance with, the second sentence of this Section 4.03 shall be deemed to
remedy (but solely for purposes of this Indenture) any default by the Lessee
under the Lease to the same extent that like performance by the Lessee itself
would have remedied such default (but any such payment or performance shall not
relieve the Lessee of its duty to pay all Rent and perform all of its
obligations pursuant to the Lease). If, on the basis specified in the preceding
sentence, such Lease Event of Default shall have been remedied, then any
declaration pursuant to the Lease that the Lease is in default, and any
declaration pursuant to this Indenture that the Equipment Notes are due and
payable or that an Indenture Event of Default exists hereunder, based upon such
Lease Event of Default, shall be deemed to be rescinded, and the Owner
Participant or the Owner Trustee, as the case may be, shall (to the extent of
any such payments made by it) be subrogated to the rights of the Note Holders
hereunder to receive such payment of Rent from the Indenture Trustee (and the
payment of interest on account of such Rent being overdue), and shall be
entitled, so long as no other Indenture Default or Indenture Event of Default
shall have occurred and be continuing, to receive, subject to the terms of this
Indenture, such payment upon receipt thereof by the Indenture Trustee; provided
that the Owner Participant shall not otherwise attempt to recover any such
amount paid by it on behalf of the Lessee pursuant to this Section 4.03 except
by demanding of the Lessee payment of such amount, or by commencing an action at
law against the Lessee and obtaining and enforcing a judgment against the Lessee
for the payment of such amount or taking appropriate action in a pending action
at law against the Lessee or by demanding Excepted Payments or Excepted Rights;
provided, however, that at no time while an Indenture Event of Default shall
have occurred and be continuing shall any such demand be made or shall any such
action be commenced (or continued) and any amounts nevertheless received by the
Owner Participant in respect thereof shall be held in trust for the benefit of,
and promptly paid to, the Indenture Trustee for distribution as provided in
Section 3.03 hereof; and provided, further, that
(x) this Section 4.03 shall not apply with respect to any
default in the payment of Basic Rent due under the Lease, if the Lessee
itself shall have theretofore failed to pay Basic Rent in the manner
required under the Lease (after giving effect to any applicable grace
period) as to (i) each
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of the three Basic Rent Payment Dates immediately preceding the date of
such default or (ii) in the aggregate more than six Basic Rent Payment
Dates,
(y) the second sentence of this Section 4.03 shall cease to
apply, and no payment by the Owner Participant in respect of
Supplemental Rent or performance of any obligation of the Lessee under
the Lease by the Owner Trustee shall be deemed to remedy or to have
remedied any Lease Event of Default for the purposes of this Indenture,
if during the 12-month period immediately preceding the relevant
default by the Lessee there shall have been expended by the Owner
Participant pursuant to the second sentence of this Section 4.03 (and
shall have not been reimbursed by the Lessee or any Permitted Sublessee
themselves to the Owner Trustee for distribution to the Owner
Participant) an amount in excess of $3,500,000, and
(z) neither the Owner Trustee nor the Owner Participant shall
(without the prior written consent of a Majority in Interest of Note
Holders) have the right to cure any Lease Default or Lease Event of
Default except as specified in this Section 4.03.
SECTION 4.04. Remedies. (a) If an Indenture Event of Default
shall have occurred and be continuing and so long as the same shall be
continuing unremedied, and if the Equipment Notes shall have been accelerated
pursuant to Section 4.04(b) or 4.04(c) hereof, then and in every such case the
Indenture Trustee may (subject to the rights of the Owner Participant or the
Owner Trustee to cure any such Indenture Event of Default set forth in Section
4.03 hereof and the obligations of the Indenture Trustee set forth in this
Section 4.04(a) and subject to Section 10.05 hereof) exercise any or all of the
rights and powers and pursue any and all of the remedies pursuant to this
Article IV and shall have and may exercise all of the rights and remedies of a
secured party under the Uniform Commercial Code and, in the event such Indenture
Event of Default is an Indenture Event of Default referred to in paragraph (a)
of Section 4.02 hereof, the Indenture Trustee may (subject as aforesaid), at the
direction of a Majority in Interest of Note Holders, exercise any and all of the
remedies pursuant to Section 18 of the Lease and pursuant to any Sublease
Assignment and may take possession of all or any part of the properties covered
or intended to be covered by the Lien and security interest created hereby or
pursuant hereto but, in the case of the Aircraft, only as permitted by Section
18 of the Lease, and may exclude the Owner Participant, the Owner Trustee and
the Lessee and all Persons claiming under any of them or wholly or partly
therefrom; provided, however, that the Indenture Trustee shall give the Owner
Trustee and the Owner Participant ten days' prior written notice of the initial
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exercise of such remedies by the Indenture Trustee under the Lease (if not
stayed or otherwise precluded by applicable law from giving such notice);
provided, further, that the Indenture Trustee shall give the Owner Trustee and
the Owner Participant twenty days' prior written notice of its intention to sell
the Aircraft. Without limiting any of the foregoing, it is understood and agreed
that the Indenture Trustee may exercise any right of sale of the Aircraft
available to it, even though it shall not have taken possession of the Aircraft
and shall not have possession thereof at the time of such sale.
Anything in this Indenture to the contrary notwithstanding,
the Indenture Trustee shall not be entitled to exercise any remedy hereunder if
there shall have occurred or be continuing a Lease Event of Default unless the
Indenture Trustee shall have exercised or concurrently be exercising one or more
of the remedies provided for in Section 18 of the Lease to terminate the Lease
or take possession and/or sell the Aircraft; provided, however, that such
requirement to exercise one or more of such remedies under the Lease shall not
apply in circumstances where the Indenture Trustee is, and has been, for a
continuous period in excess of 60 days or such other period as may be specified
in Section 1110(a)(1)(A) of the Bankruptcy Code (such 60-day or other period
being the "Section 1110 Period"), stayed or prohibited by applicable law or
court order from exercising such remedies under the Lease (a "Continuous Stay
Period"); provided further, however, that the requirement to exercise one or
more of such remedies under the Lease shall nonetheless be applicable during a
Continuous Stay Period subsequent to the expiration of the Section 1110 Period
to the extent that the continuation of such Continuous Stay Period subsequent to
the expiration of the Section 1110 Period (A) results from an agreement by the
trustee or the debtor-in-possession in such proceeding during the Section 1110
Period with the approval of the relevant court to perform the Lease in
accordance with Section 1110(a)(1)(A) of the Bankruptcy Code and continues to
perform as required by Section 1110(a)(1) of the Bankruptcy Code or (B) is an
extension of the Section 1110 Period with the consent of the Indenture Trustee
pursuant to Section 1110(b) of the Bankruptcy Code or (C) results from the
Lessee's assumption during the Section 1110 Period with the approval of the
relevant court of the Lease pursuant to Section 365 of the Bankruptcy Code or
(D) is the consequence of the Indenture Trustee's own failure to give any
requisite notice to any Person (unless the Indenture Trustee is stayed or
otherwise precluded by applicable law from giving such notice). In the event
that the applicability of Section 1110 of the Bankruptcy Code to the Aircraft is
being contested by the Lessee in judicial proceedings, so long as the Indenture
Trustee fails to participate in such proceedings, the Owner Trustee shall have
the right (without affecting in any way any right or remedy of
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the Indenture Trustee hereunder) to participate in such proceedings.
The foregoing shall not preclude the Indenture Trustee from
notifying any Permitted Sublessee that payments under any Assigned Sublease are
to be made directly to it pursuant to the terms of the relevant Sublease
Assignment, or, except as expressly provided above, from exercising its rights
or remedies hereunder and under the other Operative Documents. For the avoidance
of doubt, it is expressly understood and agreed, subject only to the immediately
preceding paragraph, that the above-described inability of the Indenture Trustee
to exercise any right or remedy under the Lease shall in no event and under no
circumstance prevent the Indenture Trustee from otherwise exercising all of its
rights, powers and remedies under this Indenture, including without limitation
this Article IV.
(b) If an Indenture Event of Default referred to in clause
(g), (h) or (i) of Section 4.02 hereof shall have occurred, or a Lease Event of
Default under clause (e), (f) or (g) of Section 17 of the Lease shall have
occurred, then and in every such case the unpaid Principal Amount of all
Equipment Notes then outstanding, together with accrued but unpaid interest and
all other amounts due thereunder and hereunder, shall immediately and without
further act become due and payable without presentment, demand, protest or
notice, all of which are hereby waived.
(c) If any Indenture Event of Default not specified in Section
4.04(b) hereof shall have occurred and be continuing, then and in every such
case the Indenture Trustee may (and shall, upon receipt of a written demand
therefor from a Majority in Interest of Note Holders), subject to Section 4.03
hereof, at any time, by written notice or notices to the Owner Trustee, declare
the unpaid Principal Amount of all Equipment Notes to be due and payable,
whereupon the unpaid Principal Amount of all Equipment Notes then outstanding,
together with accrued but unpaid interest thereon and all other amounts due
thereunder and hereunder, shall immediately become due and payable without
presentment, demand, protest or further notice, all of which are hereby waived.
(d) Sections 4.04(b) and (c), however, are subject to the
condition that, if at any time after the Principal Amount of the Equipment Notes
shall have become so due and payable, and before any judgment or decree for the
payment of the money so due, or any thereof, shall be entered, all overdue
payments of interest upon the Equipment Notes and all other amounts payable
under the Equipment Notes (except the Principal Amount of the Equipment Notes
which by such declaration shall have become payable) shall have been duly paid
and every other Indenture Default and Indenture Event of Default with respect to
any
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covenant or provision of this Indenture shall have been cured, then and in every
such case a Majority in Interest of Note Holders may (but shall not be obligated
to), by written instrument filed with the Indenture Trustee, rescind and annul
the Indenture Trustee's declaration and its consequences; but no such rescission
or annulment shall extend to or affect any subsequent Indenture Default or
Indenture Event of Default or impair any right consequent thereon.
Any acceleration pursuant to Sections 4.04(b) and (c) shall be
automatically rescinded and any related declaration of an Indenture Event of
Default annulled in the event that the Owner Trustee or the Owner Participant,
as the case may be, shall have cured, in accordance with Section 4.03, the
Indenture Event of Default that resulted in such acceleration.
No Make-Whole Amount shall become payable on the Equipment
Notes as a result of any acceleration under Section 4.04(b) or 4.04(c).
(e) Each Note Holder shall be entitled, at any sale pursuant
to Section 18 of the Lease, to credit against any purchase price bid at such
sale by such Note Holder all or any part of the unpaid obligations owing to such
Note Holder and secured by the Lien of this Indenture. The Owner Trustee or
Owner Participant may be a cash purchaser at any such sale.
(f) Notwithstanding anything contained herein, so long as the
Pass Through Trustee under any Pass Through Trust Agreement or the Subordination
Agent on its behalf is a Note Holder, the Indenture Trustee will not be
authorized or empowered to acquire title to any property in the Trust Indenture
Estate or take any action with respect to any property in the Trust Indenture
Estate so acquired by it if such acquisition or action would cause any trust
created pursuant to the Trust Agreement to fail to qualify as a "grantor trust"
for federal income tax purposes.
SECTION 4.05. Return of the Aircraft, etc. (a) Subject to
the rights of the Owner Trustee and the Owner Participant under Section 4.03
hereof and unless the Owner Participant shall have theretofore purchased the
Equipment Notes pursuant to Section 2.12 hereof, if an Indenture Event of
Default shall have occurred and be continuing and the Equipment Notes shall have
been accelerated pursuant to Section 4.04(b) or 4.04(c) hereof, at the request
of the Indenture Trustee the Owner Trustee shall promptly execute and deliver to
the Indenture Trustee such instruments of title and other documents as the
Indenture Trustee may deem necessary or advisable to enable the Indenture
Trustee or an agent or representative designated by the Indenture Trustee, at
such time or times and place or places as the
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Indenture Trustee may specify, to obtain possession of all or any part of the
Trust Indenture Estate; provided that the Indenture Trustee shall at the time be
entitled to obtain such possession under Section 4.04(a) and the other
applicable provisions of this Indenture. If the Owner Trustee shall for any
reason fail to execute and deliver such instruments and documents after such
request by the Indenture Trustee, the Indenture Trustee may (i) obtain a
judgment conferring on the Indenture Trustee the right to immediate possession
and requiring the Owner Trustee to execute and deliver such instruments and
documents to the Indenture Trustee, to the entry of which judgment the Owner
Trustee hereby specifically consents to the fullest extent it may lawfully do
so, and (ii) to the extent permitted by law, pursue all or part of the Trust
Indenture Estate wherever it may be found (but not in violation of Section 10.05
hereof or of the Lease) and may enter any of the premises of the Lessee wherever
such Trust Indenture Estate may be or be supposed to be and search for and take
possession of and remove the same (but not in violation of Section 10.05 hereof
or of the Lease). All expenses of obtaining such judgment or of pursuing,
searching for and taking such property shall, until paid, be secured by the Lien
of this Indenture.
(b) Upon a Lease Event of Default which is continuing, the
Indenture Trustee may, from time to time, at the expense of the Trust Indenture
Estate, make all such expenditures for maintenance, insurance, repairs,
replacements, alterations, additions and improvements to and of the Trust
Indenture Estate, as it may deem proper (it being understood and agreed that the
provisions hereof shall not be construed so as to expand the obligations of the
Lessee under the Lease, including Section 16 thereof). In each such case, the
Indenture Trustee shall have the right to maintain, use, operate, store, lease,
control or manage the Trust Indenture Estate and to carry on the business
(without limiting the express provisions of Section 5.10 hereof) and to exercise
all rights and powers of the Owner Participant and the Owner Trustee relating to
the Trust Indenture Estate, as the Indenture Trustee shall deem best, including
the right to enter into any and all such agreements with respect to the
maintenance, insurance, use, operation, storage, leasing, control, management or
disposition of the Trust Indenture Estate or any part thereof as the Indenture
Trustee may determine; and the Indenture Trustee shall be entitled to collect
and receive directly all tolls, rents (including Rent), revenues, issues,
income, products and profits of the Trust Indenture Estate and every part
thereof, except Excepted Payments, without prejudice, however, to the right of
the Indenture Trustee under any provision of this Indenture to collect and
receive all cash held by, or required to be deposited with, the Indenture
Trustee hereunder, except Excepted Payments. The Indenture Trustee shall,
pursuant to the exercise of its remedies under this
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Article IV, to the extent permitted by applicable law, be entitled to the
appointment of a receiver for all or any part of the Trust Indenture Estate,
whether such receivership be incidental to a proposed sale of the Trust
Indenture Estate or otherwise, and the Owner Trustee hereby consents to the
appointment of such receiver and will not oppose any such appointment. Such
tolls, rents (including Rent), revenues, issues, income, products and profits
shall be applied to pay the expenses of the use, operation, storage, leasing,
control, management or disposition of the Trust Indenture Estate and of
conducting the business thereof, and of all maintenance, repairs, replacements,
alterations, additions and improvements, and to make all payments which the
Indenture Trustee may be required or may elect to make, if any, for taxes,
assessments, insurance or other proper charges upon the Trust Indenture Estate
or any part thereof (including the employment of engineers and accountants to
examine, inspect and make reports upon the properties and books and records of
the Owner Trustee), and all other payments that the Indenture Trustee may be
required or authorized to make under any provision of this Indenture, as well as
just and reasonable compensation for the services of the Indenture Trustee, and
of all Persons properly engaged and employed by the Indenture Trustee.
SECTION 4.06. Remedies Cumulative. Each and every right, power
and remedy given to the Indenture Trustee specifically or otherwise in this
Indenture shall be cumulative and shall be in addition to every other right,
power and remedy herein specifically given or now or hereafter existing at law,
in equity or by statute, and each and every right, power and remedy whether
specifically herein given or otherwise existing may be exercised from time to
time and as often and in such order as may be deemed expedient by the Indenture
Trustee, and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the
same time or thereafter any other right, power or remedy. No delay or omission
by the Indenture Trustee in the exercise of any right, remedy or power or in the
pursuance of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default on the part of the Owner Trustee or the
Lessee or to be an acquiescence therein.
SECTION 4.07. Discontinuance of Proceedings. In case the
Indenture Trustee or any Note Holder shall have instituted any proceeding to
enforce any right, power or remedy under this Indenture by foreclosure, entry or
otherwise, and such proceedings shall have been discontinued or abandoned for
any reason or shall have been determined adversely to the Indenture Trustee or
such Note Holder, then and in every such case the Owner Trustee, the Indenture
Trustee, the Note Holders and the Lessee shall, subject to any determination in
such proceedings,
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be restored to their former positions and rights hereunder with respect to the
Trust Indenture Estate, and all rights, remedies and powers of the Indenture
Trustee and the Note Holders shall continue as if no such proceedings had been
instituted.
SECTION 4.08. Waiver of Past Indenture Defaults. Upon written
instructions from a Majority in Interest of Note Holders, the Indenture Trustee
shall waive any past Indenture Default hereunder and its consequences and upon
any such waiver such Indenture Default shall cease to exist and any Indenture
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture, but no such waiver shall extend to any subsequent or
other Indenture Default or impair any right consequent thereon; provided,
however, that in the absence of written instructions from the Holders of all
Equipment Notes then outstanding, the Indenture Trustee shall not waive any
Indenture Default (i) in the payment of the Principal Amount of or interest on
any Equipment Note then outstanding, or (ii) in respect of a covenant or
provision hereof which, under Article IX hereof, cannot be modified or amended
without the consent of each Note Holder.
SECTION 4.09. Exercise of Remedies by Foreign Note Holders. If
the Indenture Trustee shall exercise remedies pursuant to this Article IV, at a
time when (i) the Aircraft is registered with the Federal Aviation
Administration, (ii) 25% or more of the then unpaid Principal Amount of the
Equipment Notes is held by one or more Persons which are not a "citizen of the
United States" within the meaning of Section 40102(a)(15) of the Federal
Aviation Act and (iii) remedies are to be exercised pursuant to this Article IV
as a result of the occurrence of an Indenture Event of Default which is not a
Lease Event of Default, the Indenture Trustee shall make arrangements, if any,
as may be required by law so that such exercise of remedies shall not result in
the ineligibility of the Aircraft to be registered under the Federal Aviation
Act.
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Indenture Event of Default. In the
event the Indenture Trustee shall have knowledge of an Indenture Event of
Default, or shall have knowledge of an Indenture Default arising either from a
failure to pay Rent or a Lease Default of the type referred to in the second
sentence of Section 4.03, the Indenture Trustee shall give prompt notice thereof
to the Owner Trustee, the Owner Participant and the Lessee by facsimile, telex,
telegraph or telephone (confirmed by written notice in the manner provided by
Section 10.06 hereof),
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and to each Note Holder by first-class mail. Subject to the terms of Sections
2.12, 4.03, 4.04, 4.08, 4.09, 5.03, 5.10 and 10.05 hereof and of this Section
5.01, the Indenture Trustee shall take such action, or refrain from taking such
action, with respect to any Indenture Event of Default or Indenture Default
(including with respect to the exercise of any rights or remedies hereunder) as
the Indenture Trustee shall be instructed in writing by a Majority in Interest
of Note Holders. Subject to the provisions of Section 5.03 hereof, if the
Indenture Trustee shall not have received instructions as above provided within
20 calendar days after mailing notice of such Indenture Default or Indenture
Event of Default to the Note Holders, the Indenture Trustee may, subject to
instructions thereafter received pursuant to the preceding provisions of this
Section 5.01, take such action, or refrain from taking such action, but shall be
under no duty to take or refrain from taking any action, with respect to such
Indenture Default or Indenture Event of Default as it shall determine to be
advisable and in the best interests of the Note Holders and shall use the same
degree of care and skill in connection therewith as a prudent person would use
under the circumstances in the conduct of its own affairs; provided that the
Indenture Trustee may not sell the Aircraft or any part thereof without the
consent of a Majority in Interest of Note Holders. In the event the Indenture
Trustee shall at any time elect to foreclose or otherwise enforce this
Indenture, the Indenture Trustee shall forthwith notify, to the extent (in the
case of any such party) not stayed or otherwise prohibited by applicable law,
the Owner Participant, the Note Holders, the Owner Trustee and the Lessee. For
all purposes of this Indenture, in the absence of actual knowledge on the part
of an officer in the Corporate Trust Office, in the case of the Indenture
Trustee, or its Corporate Trust Administration Department, in the case of the
Owner Trustee, the Indenture Trustee or the Owner Trustee, as the case may be,
shall not be deemed to have knowledge of an Indenture Event of Default (except,
in the case of the Indenture Trustee, the failure of the Lessee to pay any
installment of Rent when due, if any portion of such installment was then
required to be paid to the Indenture Trustee, which failure shall constitute
knowledge of an Indenture Default for purposes of the first sentence of this
Section 5.01) unless notified in writing by the Lessee, the Owner Trustee or one
or more Note Holders or, in the case of the Owner Trustee, by the Indenture
Trustee.
SECTION 5.02. Action Upon Instructions. Subject to the terms
of Sections 2.12, 4.03, 4.04, 4.08, 4.09, 5.01, 5.03, 5.10, 9.01 and 10.05
hereof, upon the written instructions at any time and from time to time of a
Majority in Interest of Note Holders, the Indenture Trustee shall take such of
the following actions as may be specified in such instructions: (i) exercise
such election or option, or make such decision or determination,
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or give such notice, consent, waiver or approval or exercise such right, remedy
or power to take such other action hereunder or under any other Indenture
Document or in respect of any part or all of the Trust Indenture Estate as shall
be specified in such instructions; (ii) take such action with respect to, or to
preserve or protect, the Trust Indenture Estate (including the discharge of
Liens) as shall be specified in such instructions and as are consistent with
this Indenture; and (iii) take such other action in respect of the subject
matter of this Indenture as is consistent with the terms hereof and of the other
Indenture Documents. The Indenture Trustee will execute and the Owner Trustee
will file or cause to be filed such continuation statements with respect to
financing statements relating to the security interest created hereunder in the
Trust Indenture Estate as may be specified from time to time in written
instructions of a Majority in Interest of Note Holders (which instructions may,
by their terms, be operative only at a future date and which shall be
accompanied by the execution form of such continuation statement so to be
filed); provided that, notwithstanding the foregoing, the Indenture Trustee may,
but shall not be obligated to, execute and file or cause to be filed any
financing statement which it from time to time deems appropriate or any
continuation statement that the Lessee, in discharge of its obligations under
Section 3(v) of the Refunding Agreement or any other Operative Document, may so
request. Notwithstanding the foregoing or anything in this Indenture to the
contrary, the Indenture Trustee may, on the advice of its counsel and without
the consent or approval of any Note Holder, approve any counsel asked to opine
on any matters under Section 11(b)(ii) of the Refunding Agreement, Section
6(a)(iii) of the Lease or under this Indenture and approve any opinion issued by
such counsel. None of the Owner Participant, the Owner Trustee or the Lessee
have any liability for the failure of the Indenture Trustee to discharge its
obligations hereunder.
SECTION 5.03. Indemnification. The Indenture Trustee shall not
be required to take any action or refrain from taking any action under Section
5.01 (other than the first sentence thereof) or 5.02 or Article IV hereof unless
the Indenture Trustee shall have been indemnified against any liability, cost or
expense (including counsel fees) that may be incurred in connection therewith.
The Indenture Trustee shall not be under any obligation to take any action under
this Indenture and nothing in this Indenture contained shall require the
Indenture Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. The Indenture Trustee shall not be
required to take any action under Section 5.01 (other than the
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first sentence thereof) or 5.02 or Article IV hereof, nor shall any other
provision of this Indenture be deemed to impose a duty on the Indenture Trustee
to take any action, if the Indenture Trustee shall have been advised by counsel
that such action is contrary to the terms hereof or of the other Indenture
Documents or is otherwise contrary to law.
SECTION 5.04. No Duties Except as Specified in Indenture or
Instructions. The Indenture Trustee shall not have any duty or obligation to
maintain, use, operate, store, lease, control, manage, sell, dispose of, insure
or otherwise deal with the Aircraft or any other part of the Trust Indenture
Estate, or to otherwise take or refrain from taking any action under, or in
connection with, this Indenture or any Indenture Document or any part of the
Trust Indenture Estate, except as expressly provided by the terms of this
Indenture or as expressly provided in written instructions from Note Holders as
provided in this Indenture and no implied duties or obligations shall be read
into this Indenture against the Indenture Trustee. It is understood that, as
between the Indenture Trustee and the Note Holders, with respect to all matters
left to the discretion of the Indenture Trustee hereunder, or under any
Indenture Document, the Indenture Trustee shall have the right to request
written instructions from the Note Holders and, pending receipt of such
instructions from the Note Holders or the required percentage thereof as
provided herein, the Indenture Trustee shall not be required to take any such
discretionary action hereunder; provided, however, that if the Indenture Trustee
shall request written instructions pursuant to this Section 5.04, it will use
reasonable efforts to seek and obtain such instructions promptly so as not
unreasonably to delay the proposed action of Lessee in respect of which the
instructions are sought. The Indenture Trustee agrees that it will in its
individual capacity and at its own cost and expense (but without any right of
indemnity in respect of any such cost or expense under Article VII hereof or any
other Operative Document) promptly take such action as may be necessary to duly
discharge all Lenders' Liens on any part of the Trust Indenture Estate
attributable to it in its individual capacity.
SECTION 5.05. No Action Except Under Lease, Refunding
Agreement, Indenture or Instructions. The Owner Trustee and the Indenture
Trustee agree that they will not use, operate, store, lease, control, manage,
sell, dispose of or otherwise deal with, or place Liens on, the Aircraft or any
other part of the Trust Indenture Estate except (i) as required or permitted by
the terms of the Lease or the Refunding Agreement, or (ii) in accordance with
the powers granted to, or the authority conferred upon, the Owner Trustee and
the Indenture Trustee pursuant to this Indenture and in accordance with the
terms hereof.
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SECTION 5.06. Replacement Airframes, Replacement Engines and
Replacement Parts. (a) If at any time and from time to time, the Airframe or
Engine(s) may, or may be required to, be replaced under Section 6(a), 11(a),
11(b) or 16(c) of the Lease by a Replacement Airframe or Replacement Engine(s),
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 such Airframe and/or Engine(s) 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 Airframe and/or Engine(s) so to be released and
the Replacement Airframe and/or Replacement Engine(s).
(2) A certificate signed by a duly authorized officer of the Lessee
stating the following:
A. With respect to the replacement of any Airframe:
(i) a description of the Airframe which shall be identified by
manufacturer, model, FAA registration number (or other applicable
registration number) and manufacturer's serial number;
(ii) a description of the Replacement Airframe (including the
manufacturer, model, FAA registration number (or other applicable
registration number) and manufacturer's serial number) to be received
as consideration for the Airframe to be released;
(iii) that on the date of the Indenture Supplement relating to the
Replacement Airframe the Owner Trustee will hold legal title to such
Replacement Airframe free and clear of all Liens except Permitted
Liens, that such Replacement Airframe will on such date be in good
operating condition, and that such Replacement Airframe has been or,
substantially concurrently with such replacement, is in the process of
being duly registered with the Owner Trustee as owner thereof under the
Federal Aviation Act or under the law then applicable to the
registration of the Aircraft and that an airworthiness certificate has
been duly issued under the Federal Aviation Act (or such other
applicable law) with respect to such Replacement Airframe, and that
such
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registration and certificate is in full force and effect, and the
Lessee or a Permitted Sublessee will have the full right and authority
to use such Replacement Airframe;
(iv) that the insurance required by Section 12 of the Lease is in
full force and effect with respect to such Replacement Airframe and all
premiums then due thereon have been paid in full;
(v) that the Replacement Airframe is of a like Airbus A320-231
model airframe with equivalent or better modification status delivered
by the Manufacturer not earlier than June 30, 1988;
(vi) 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 a Replacement Airframe;
(vii) an appraisal prepared in accordance with the Appraisal
Procedure (as defined in the Lease) confirms that the Replacement
Airframe has a value, utility and remaining useful life at least equal
to that of the Airframe which suffered the Event of Loss assuming that
the same were maintained in accordance with the requirements of the
Lease whether or not they are in fact so maintained; and
(viii) that each of the conditions specified in Section 11(a) and
(c) of the Lease with respect to such Replacement Airframe have been
satisfied.
B. With respect to the replacement of any 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 to be released;
(iii) that on the date of the Indenture Supplement relating to the
Replacement Engine the Owner Trustee will hold title to such
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 such Replacement Engine is the same or an improved
model as the Engine to be released;
(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
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less than the then value, remaining useful life and utility of the
Engine requested to be released, assuming such 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 such Replacement Engine; and
(vi) that each of the conditions specified in Section 11(b) of the
Lease with respect to such Replacement Engine have been satisfied.
(3) The appropriate instrument or instruments (i) transferring to the
Owner Trustee title to the Replacement Airframe or Replacement Engine to be
received as consideration for the Airframe or Engine to be released, (ii)
assigning to the Owner Trustee the benefit of all manufacturer's and vendor's
warranties generally available with respect to such Replacement Airframe or
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 Airframe or 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) With respect to a Replacement Airframe, an appraisal from BK
Associates, Avmark Services Ltd., AeroEconomics, Inc. or another firm of
independent aircraft appraisers satisfactory to the Indenture Trustee confirming
the accuracy of the information set forth in Section 5.06(a)2.A(vii) hereof.
(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 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 Airframe and/or Replacement Engine(s)
have been validly subjected to the Lien of this Indenture and covered
by the Lease, the instruments subjecting such Replacement Airframe or
Replacement Engine to the Lien of this Indenture and the Lease, and
subjecting
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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 registration of
the Aircraft, 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 Aircraft is registered outside the United States, in
the jurisdiction of registration, the legal title to such Replacement
Airframe and/or Replacement Engine and the Lien of this Indenture on
such Replacement Airframe and/or 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 Airframe and, if an Event of Loss with respect to the
Aircraft has occurred, the Replacement Engines to the same extent as
with respect to the Airframe and Engines then installed thereon 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.
SECTION 5.07. Indenture Supplements for Replacements. In the
event of the substitution of a Replacement Airframe or Engine as contemplated by
Section 11 of the Lease, the Owner Trustee and the Indenture Trustee agree for
the benefit of the Note Holders and the Lessee, subject to fulfillment of the
conditions precedent and compliance by the Lessee with its obligations set forth
in Section 11 of the Lease, to execute and deliver the appropriate instruments
as contemplated by Section 5.06 hereof, and execute and deliver to the Lessee
(or any relevant Permitted Sublessee) an appropriate instrument releasing the
Airframe and/or Engine(s) being replaced from the Lien of this Indenture.
SECTION 5.08. Effect of Replacement. In the event of
the substitution of a Replacement Airframe or Engine as
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contemplated by Section 11 of the Lease and Section 5.06 hereof, all provisions
of this Indenture relating to the Airframe or Engine(s) being replaced shall be
applicable to such Replacement Airframe or Replacement Engine(s) with the same
force and effect as if such Replacement Airframe or Replacement Engine(s) were
the same airframe or engine(s), as the case may be, as the Airframe or Engine(s)
being replaced.
SECTION 5.09. Notices, etc. Where this Indenture expressly
provides for notice to Note Holders, such notice shall be sufficiently given
(unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Note Holder entitled thereto, at his last
address as it appears in the Register. In any case where notice to Note Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Note Holder shall affect the sufficiency of
such notice with respect to other Note Holders. Where this Indenture provides
for notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Note Holders
shall be filed with the Indenture Trustee, but such filing shall not be a
condition precedent to the validity of any action taken in reliance upon such
waiver.
In case, by reason of the suspension of or irregularities in
regular mail service, it shall be impracticable to mail notice to the Note
Holders when such notice is required to be given pursuant to any provision of
this Indenture, then any manner of giving such notice as shall be satisfactory
to the Indenture Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 5.10. Certain Rights of Owner Trustee and Owner
Participant. Notwithstanding any other provisions of this Indenture, including
the Granting Clause, but subject always to the final paragraph of this Section
5.10, the following rights shall be reserved to the Owner Trustee or Owner
Participant, as the case may be (as separate and independent rights) to the
extent described herein:
(a) the Owner Trustee or the Owner Participant may, without
the consent of the Indenture Trustee, demand, collect, ▇▇▇ for or
otherwise obtain all amounts included in Excepted Payments from the
Lessee, exercise any election or option or make any decision or
determination or give or receive any notice, consent, waiver or
approval in respect of any Excepted Payment and seek legal or equitable
remedies to require the Lessee to maintain the insurance coverage
referred to in Section 12 of the Lease (or the comparable
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provisions of any Assigned Sublease) and such specific performance of
the covenants of the Lessee under the Lease (or the comparable
provisions of any Assigned Sublease) relating to the protection,
maintenance, possession and use of the Aircraft; provided, that the
rights referred to in this clause (a) shall not be deemed to include
the exercise of any remedies provided for in Section 18 of the Lease
(or the comparable provisions of any Assigned Sublease) other than the
right to proceed by appropriate court action, either at law or in
equity, to enforce payment by the Lessee of such amounts included in
Excepted Payments or performance by the Lessee of such insurance
covenant or to recover damages for the breach thereof or for specific
performance of any covenant of the Lessee;
(b) (i) the Indenture Trustee shall not, without the consent
of the Owner Trustee, enter into, execute and deliver amendments or
modifications in respect of any of the provisions of the Lease, any
Assigned Sublease or any Sublease Assignment and (ii) unless an
Indenture Event of Default and an Indenture Trustee Event shall have
occurred and be continuing, the Indenture Trustee shall not, without
the consent of the Owner Trustee, which consent shall not be withheld
if no right or interest of the Owner Trustee or the Owner Participant
shall be materially diminished or impaired thereby, (A) enter into,
execute and deliver waivers or consents in respect of any of the
provisions of the Lease, any Assigned Sublease or any Sublease
Assignment, or (B) approve any accountants, engineers, appraisers or
counsel as satisfactory to render services for or issue opinions to the
Owner Trustee pursuant to the Operative Documents; provided that,
whether or not an Indenture Event of Default has occurred and is
continuing, the Owner Trustee's consent shall be required with respect
to any waivers or consents in respect of any of the provisions of
Section 6, 12 or 16 of the Lease, or of any other Section of the Lease
to the extent such action shall affect (y) the amount or timing of, or
the right to enforce payment of any Excepted Payment or (z) the amount
or timing of any amounts payable by the Lessee under the Lease as
originally executed (or as subsequently modified with the consent of
the Owner Trustee) which, absent the occurrence and continuance of an
Indenture Event of Default hereunder, would be distributable to the
Owner Trustee under Article III hereof;
(c) at all times whether or not an Indenture Event of Default
has occurred and is continuing, the Owner Trustee and the Owner
Participant shall have the right, together with the Indenture Trustee,
(i) to receive from the Lessee or any Permitted Sublessee all notices,
certificates, reports, filings, opinions of counsel and other documents
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and all information which any thereof is permitted or required to give
or furnish to the Owner Trustee pursuant to any Operative Document
(including pursuant to Section 10 of the Lease), (ii) to exercise
inspection rights pursuant to Section 7 of the Lease, (iii) to retain
all rights with respect to insurance maintained for its own account
which Section 12 of the Lease specifically confers on the Owner
Participant and (iv) to exercise, to the extent necessary to enable it
to exercise its rights under Section 4.03 hereof, the rights of the
Owner Trustee under Section 21(d) of the Lease and to give notices of
default under Section 17 of the Lease; and
(d) except as expressly provided to the contrary in clauses
(a), (b) and (c) above, so long as no Indenture Event of Default has
occurred and is continuing, all rights (including options, elections,
determinations, consents, approvals, waivers and the giving of notices)
of the Owner Trustee and the Owner Participant under the Lease shall be
exercised by the Owner Trustee and/or the Owner Participant, as the
case may be, to the exclusion of the Indenture Trustee and any Note
Holder and without the consent of the Indenture Trustee or any Note
Holder; provided that the foregoing shall not, nor shall any other
provision of this Section 5.10, limit (A) any rights separately and
expressly granted to the Indenture Trustee or any Note Holder under the
Lease or the other Operative Documents (including, without limitation,
Section 15 of the Refunding Agreement) or (B) the right of the
Indenture Trustee or any Note Holder to receive any funds to be
delivered to the Owner Trustee under the Lease (except with respect to
Excepted Payments).
Notwithstanding the foregoing provisions of this Section 5.10,
but subject always to Section 10.05 hereof and to the rights of the Owner
Participant under Sections 2.12 and 4.03 hereof, the Indenture Trustee shall at
all times have the right, to the exclusion of the Owner Trustee and the Owner
Participant, to (A) demand, collect, ▇▇▇ for or otherwise receive and enforce
the payment of all Rent due and payable under the Lease (other than any thereof
constituting an Excepted Payment or Excepted Right), (B) declare the Lease to be
in default under Section 18 thereof and (C) subject only to the provisions of
Sections 4.03 and 4.04(a) hereof, exercise the remedies set forth in such
Section 18 (other than in connection with Excepted Payments) and in Article IV
hereof.
SECTION 5.11. Evidence of Action Taken by Note Holder. Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Note Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such
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Note Holders in person or by agent duly appointed in writing, and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Indenture Trustee and, if
expressly required herein, to the Owner Trustee. Proof of execution of any
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Sections 5.04, 5.05, 6.02 and 6.05)
conclusive in favor of the Indenture Trustee and the Owner Trustee if made in
the manner provided in this Indenture.
SECTION 5.12. Right of Revocation of Action Taken. At any time
prior to (but not after) the evidencing to the Indenture Trustee, as provided in
Section 5.11 hereof, of the taking of any action by the Note Holders of the
percentage in aggregate Principal Amount of the Equipment Notes specified in
this Indenture in connection with such action, any Note Holder which has
consented to such action may, by filing written notice at the Corporate Trust
Office and upon proof of holding an Equipment Note, revoke such action so far as
concerns such Equipment Note. Except as aforesaid any such action taken by the
Note Holder shall be conclusive and binding upon such Note Holder and upon all
future Note Holders and owners of such Equipment Note and of any Equipment Notes
issued in exchange or substitution therefor, irrespective of whether or not any
notation in regard thereto is made upon any such Equipment Note. Any action
taken by the Note Holders of the percentage in aggregate Principal Amount of the
Equipment Notes specified in this Indenture in connection with such action shall
be conclusively binding upon the Owner Trustee, the Indenture Trustee and the
Note Holders.
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties. The Indenture
Trustee in its individual capacity accepts the trust hereby created and agrees
to perform the same but only upon the terms of this Indenture. The Indenture
Trustee agrees for the benefit of the Note Holders, the Owner Trustee and the
Owner Participant to receive and disburse all moneys constituting part of the
Trust Indenture Estate in accordance with the terms hereof; and neither the
Trust Company nor the Indenture Trustee in its individual capacity shall be
answerable or accountable under any circumstances, except for its own willful
misconduct or gross negligence (other than for the handling of funds, for which
the standard of accountability shall be negligence), or as provided in the
fourth sentence of Section 2.04(a) hereof and in the last sentence of Section
5.04 hereof, and except for liabilities that may result, in the case of the
Trust Company,
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from the inaccuracy of any representation or warranty of the Trust Company in
the Refunding Agreement or in the Trust Agreement or in Section 6.03 hereof or
the failure to perform any covenant of the Trust Company pursuant to Section
4.01(a) hereof or in the Trust Agreement, the Refunding Agreement, or, in the
case of the Indenture Trustee, from the inaccuracy of any representation or
warranty, or failure to perform any covenant, of the Indenture Trustee made in
its individual capacity herein, in the Refunding Agreement or in any other
document. None of the Owner Participant, the Trust Company or the Indenture
Trustee shall be liable for any action or inaction of any other one of such
parties, except, in the case of the Owner Participant, for any action or
omission of the Owner Trustee performed or omitted on the instructions of the
Owner Participant. The Owner Trustee shall not be deemed a trustee for the Note
Holders for any purpose.
SECTION 6.02. Absence of Duties. In the case of the Indenture
Trustee, except in accordance with written instructions furnished pursuant to
Section 5.01, 5.02 or 9.01 hereof, and except as provided in, and without
limiting the generality of, Sections 5.03, 5.04 and 6.09 hereof and, in the case
of the Owner Trustee, except as provided in Section 4.01(b), 6.09 or 9.01 hereof
and in the Trust Agreement, the Lease and the Refunding Agreement, the Owner
Trustee and the Indenture Trustee shall have no duty (i) to see to any
registration of the Aircraft or any recording or filing of the Lease or of this
Indenture or any other document, or to see to the maintenance of any such
registration, recording or filing, (ii) to see to any insurance on the Aircraft,
whether or not the Lessee shall be in default with respect thereto, (iii) to see
to the payment or discharge of any Lien of any kind against any part of the
Trust Estate or the Trust Indenture Estate, (iv) to confirm, verify or inquire
into the failure to receive any financial statements of the Lessee or (v) to
inspect the Aircraft at any time or ascertain or inquire as to the performance
or observance of any of the Lessee's covenants under the Lease or any of the
Permitted Sublessee's covenants under any Assigned Sublease with respect to the
Aircraft.
SECTION 6.03. No Representations or Warranties as to Aircraft
or Documents. NEITHER THE INDENTURE TRUSTEE (INDIVIDUALLY OR AS INDENTURE
TRUSTEE) NOR THE OWNER TRUSTEE NOR THE TRUST COMPANY MAKES OR SHALL BE DEEMED TO
HAVE MADE, AND EACH HEREBY EXPRESSLY DISCLAIMS, ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, AS TO THE TITLE (EXCEPT AS SET FORTH IN SECTION 5(a) OF THE
LEASE), AIRWORTHINESS, VALUE, WORKMANSHIP, COMPLIANCE WITH SPECIFICATIONS,
CONDITION, DESIGN, QUALITY, DURABILITY, OPERATION, MERCHANTABILITY OR FITNESS
FOR USE OR PURPOSE OF THE AIRCRAFT OR ANY ENGINE OR ANY PART THEREOF, AS TO THE
ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT
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DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR
COPYRIGHT, AS TO THE ABSENCE OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT,
OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE AIRCRAFT OR ANY
ENGINE, except that the Trust Company warrants that (i) on the Delivery Date for
the Aircraft the Owner Trustee shall have received whatever interest in the
Aircraft was conveyed to it under the Warranty ▇▇▇▇ of Sale subject to the
rights of the parties to the Indenture Documents and (ii) the Aircraft shall be
free and clear of Lessor's Liens attributable to the Trust Company. Neither the
Trust Company nor the Indenture Trustee makes or shall be deemed to have made
any representation or warranty as to the validity, legality or enforceability of
this Indenture, the Trust Agreement, the Equipment Notes or any Indenture
Documents or as to the correctness of any statement contained in any thereof,
except for the representations and warranties of the Trust Company and the
Indenture Trustee in its individual capacity or as Indenture Trustee made under
this Indenture or in the other Operative Documents.
SECTION 6.04. No Segregation of Moneys; No Interest. Any
moneys paid to or retained by the Indenture Trustee pursuant to any provision
hereof and not then required to be distributed to any Note Holder, the Lessee or
the Owner Trustee as provided in Article III hereof need not be segregated in
any manner except to the extent required by law, and may be deposited under such
general conditions as may be prescribed by law, and the Indenture Trustee shall
not (except as otherwise provided in Section 3.07 hereof) be liable for any
interest thereon; provided that any payments received or applied hereunder by
the Indenture Trustee shall be accounted for by the Indenture Trustee so that
any portion thereof paid or applied pursuant hereto shall be identifiable as to
the source thereof.
SECTION 6.05. Reliance; Agents; Advice of Counsel. Neither the
Owner Trustee nor the Indenture Trustee shall incur any liability to anyone in
acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper believed by
it to be genuine and believed by it to be signed by the proper party or parties.
The Owner Trustee and the Indenture Trustee may accept a copy of a resolution of
the Board of Directors of any party to the Refunding Agreement, certified by the
Secretary or an Assistant Secretary thereof as duly adopted and in full force
and effect, as conclusive evidence that such resolution has been duly adopted
and that the same is in full force and effect. As to the aggregate unpaid
Principal Amount of Equipment Notes outstanding as of any date, the Owner
Trustee may for all purposes hereof rely on a certificate signed by any Vice
President or other authorized corporate trust officer of the Indenture Trustee.
As to any fact or matter relating to the Lessee the manner of
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ascertainment of which is not specifically described herein, the Owner Trustee
and the Indenture Trustee may for all purposes hereof rely on a certificate,
signed by a duly authorized officer of the Lessee, as to such fact or matter,
and such certificate shall constitute full protection to the Owner Trustee and
the Indenture Trustee for any action taken or omitted to be taken by them in
good faith in reliance thereon, but in the case of any such certificate, the
Owner Trustee and the Indenture Trustee shall be under a duty to examine the
same to determine whether or not it conforms to the requirements of this
Indenture. The Indenture Trustee shall assume, and shall be fully protected in
assuming, that the Owner Trustee is authorized by the Trust Agreement to enter
into this Indenture and to take all action to be taken by it pursuant to the
provisions hereof, and shall not inquire into the authorization of the Owner
Trustee with respect thereto. In the administration of the trusts hereunder, the
Owner Trustee and the Indenture Trustee each may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or (except in
the case of the Indenture Trustee's obligations under the third sentence of
Section 2.04(a)) through agents or attorneys and shall not be responsible for
any misconduct or negligence on the part of any such agent or attorney appointed
with due care hereunder. The Indenture Trustee may, at the expense of the Trust
Indenture Estate, consult with counsel, accountants and other skilled Persons to
be selected and retained by it, and the Owner Trustee and the Indenture Trustee
shall not be liable for anything done, suffered or omitted in good faith by them
in accordance with the written advice or written opinion of any such counsel,
accountants or other skilled Persons.
SECTION 6.06. Capacity in Which Acting. The Owner Trustee acts
hereunder solely as trustee under the Trust Agreement provided, and not in its
individual capacity, except as otherwise expressly provided herein.
SECTION 6.07. Compensation. The Indenture Trustee shall be
entitled to reasonable compensation (which compensation shall not (to the extent
permitted by applicable law) be limited by any provision of law in regard to the
compensation of a trustee of an express trust), including expenses, advances and
disbursements, for all services rendered hereunder, and shall have a first
priority claim (prior to the Note Holders) on the Trust Indenture Estate for the
payment of such compensation, to the extent that such compensation shall not be
paid by the Lessee, and shall have the right to use or apply any moneys held by
it hereunder in the Trust Indenture Estate toward such payments. The Indenture
Trustee agrees that it shall have no right against any Note Holder or the Owner
Participant for any fee as compensation for its services as trustee under this
Indenture.
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SECTION 6.08. May Become Note Holder. Each of the institutions
acting as Owner Trustee and Indenture Trustee hereunder may become a Note Holder
and have all rights and benefits of a Note Holder to the same extent as if it
were not the institution acting as Owner Trustee or Indenture Trustee, as the
case may be.
SECTION 6.09. Further Assurances; Financing Statements. At any
time and from time to time, upon the request of the Indenture Trustee, the Owner
Trustee shall promptly and duly execute and deliver any and all such further
instruments and documents as may be specified in such request and as are
necessary or desirable to perfect, preserve or protect the mortgage, security
interests and assignments created or intended to be created hereby, or to obtain
for the Indenture Trustee the full benefit of the specific rights and powers
herein granted, including, without limitation, the execution and delivery of
Uniform Commercial Code financing statements and continuation statements with
respect thereto, or similar instruments relating to the perfection of the
mortgage, security interests or assignments created or intended to be created
hereby.
ARTICLE VII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification. The Owner Trustee, not
individually but solely in its capacity as owner trustee under the Trust
Agreement, hereby agrees, whether or not any of the transactions contemplated
hereby shall be consummated but except as otherwise provided in Section 2.03
hereof, to assume liability for, and does hereby indemnify, protect, save and
keep harmless the Indenture Trustee, in its individual capacity and as Indenture
Trustee, and its successors, permitted assigns, agents and servants solely from
the Trust Estate, from and against any and all liabilities, obligations, losses,
damages, penalties, taxes (excluding any taxes payable by the Indenture Trustee
on or measured by any compensation received by the Indenture Trustee for its
services under this Indenture), claims, actions, suits, and reasonable
out-of-pocket costs, expenses or disbursements (including reasonable legal fees
and expenses) of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Indenture Trustee (in its individual
capacity and as trustee) from and after the Restatement Date (whether or not
also agreed to be indemnified against by any other Person under any other
document) in any way relating to or arising out of this Indenture, the Trust
Agreement, the Equipment Notes, the other Indenture 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,
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acceptance, nonacceptance, rejection, ownership, delivery, lease, sublease,
possession, use, operation, condition, sale, return or other disposition of the
Aircraft or any Engine (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 Indenture Estate or the action or inaction of the Indenture Trustee
hereunder, except only (i) in the case of willful misconduct or gross negligence
(or negligence in the case of handling of funds) of the Indenture Trustee in the
performance of its duties hereunder, (ii) as may result from the inaccuracy of
any representation or warranty of the Indenture Trustee made in the Refunding
Agreement, (iii) as otherwise provided in Section 2.04(a) hereof or in the last
sentence of Section 5.04 hereof or (iv) as otherwise excluded by the terms of
Sections 10(b) and 13 of the Lease from the Lessee's indemnities to the
Indenture Trustee, in its individual capacity and as Indenture Trustee, and its
successors, permitted assigns, agents and servants, thereunder; provided that so
long as the Lease is in effect, the Indenture Trustee shall not make any claim
under this Section 7.01 for any amount indemnified against by the Lessee under
the Lease without first (but only to the extent not stayed or otherwise
prevented by operation of law) making demand on the Lessee for payment of such
amount. The Indenture Trustee shall notify the Owner Trustee and the Lessee
promptly of any claim for which it may seek indemnity. The Lessee shall be
entitled to defend any claim by the Indenture Trustee to the extent provided in
Section 10 or 13 of the Lease. The Indenture Trustee shall be entitled to
indemnification from the Trust Indenture Estate for any liability, obligation,
loss, damage, penalty, claim, action, suit, cost, expense or disbursement
indemnified against pursuant to this Section 7.01 to the extent not reimbursed
by the Lessee or others, but without releasing any of them from their respective
agreements of reimbursement; and to secure the same the Indenture Trustee shall
have a prior Lien on the Trust Indenture Estate. The indemnities contained in
this Section 7.01 shall survive the termination of this Indenture.
SECTION 7.02. Exculpation and Release of Liability. Without in
any way affecting the limitations on liability set forth in the Operative
Documents, the Indenture Trustee, and each Note Holder by accepting any
Equipment Note hereunder, hereby acknowledge and agree that none of the Trust
Company, the Owner Participant or any director, officer, employee, stockholder,
agent or affiliate of the Trust Company or the Owner Participant (the
"Exculpated Equity Persons") shall have any obligation, duty or liability of any
kind whatsoever to the Indenture Trustee or any such Note Holder in connection
with the exercise by any Exculpated Equity Person of any rights of the Owner
Trustee or the taking of any action or the failure to take any action by any
Exculpated Equity Person in connection with any rights of the
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Owner Trustee under this Indenture or the Lease, and each such Note Holder
hereby waives and releases, to the extent permitted by applicable law, each
Exculpated Equity Person of any and all such obligations, duties or liabilities.
ARTICLE VIII
SUCCESSOR TRUSTEES AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee. In the case
of any appointment of a successor to the Owner Trustee pursuant to the Trust
Agreement or any merger, conversion, consolidation or sale of substantially all
of the corporate trust business of the Trust Company pursuant to the Trust
Agreement, the successor Owner Trustee shall give prompt written notice thereof
to the Indenture Trustee and to each Note Holder.
SECTION 8.02. Resignation and Removal of Indenture Trustee;
Appointment of Successor. (a) The Indenture Trustee or any successor thereto may
resign at any time without cause by giving at least 30 calendar days' prior
written notice to the Owner Trustee, the Owner Participant, each Note Holder and
the Lessee, such resignation to be effective upon the acceptance of the
trusteeship by a successor Indenture Trustee. In addition, a Majority in
Interest of Note Holders may at any time remove the Indenture Trustee without
cause by an instrument in writing delivered to the Owner Trustee, the Lessee and
the Indenture Trustee, and the Indenture Trustee shall promptly notify each Note
Holder thereof in writing, such removal to be effective upon the acceptance of
the trusteeship by a successor Indenture Trustee. In the case of the resignation
or removal of the Indenture Trustee, a Majority in Interest of Note Holders may
appoint, with the consent of the Lessee, a successor Indenture Trustee by an
instrument signed by such Holders (whose fees shall be reasonably acceptable to
the Lessee). If a successor Indenture Trustee shall not have been appointed
within 30 calendar days after such notice of resignation or removal, the
Indenture Trustee, any Note Holder, the Owner Trustee, the Lessee or the Owner
Participant may apply to any court of competent jurisdiction to appoint a
successor Indenture Trustee to act until such time, if any, as a successor shall
have been appointed as above provided. The successor Indenture Trustee so
appointed by such court shall immediately and without further act be superseded
by any successor Indenture Trustee appointed as above provided within one year
from the date of the appointment by such court.
(b) Any successor Indenture Trustee, however appointed, shall
execute and deliver to the Owner Trustee and to the predecessor Indenture
Trustee an instrument accepting and
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assuming such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Indenture Trustee,
without further act, shall become vested with and bound by all the estates,
properties, rights, powers, duties and obligations of the predecessor Indenture
Trustee hereunder and under the other Indenture Documents in the trusts
hereunder applicable to it with like effect as if originally named the Indenture
Trustee herein; but nevertheless upon the written request of such successor
Indenture Trustee, such predecessor Indenture Trustee shall execute and deliver
an instrument transferring to such successor Indenture Trustee, upon the trusts
herein expressed applicable to it, all the estates, properties, rights and
powers of such predecessor Indenture Trustee, and such predecessor Indenture
Trustee shall duly assign, transfer, deliver and pay over to such successor
Indenture Trustee all moneys or other property then held by such predecessor
Indenture Trustee hereunder, subject nevertheless to its claim provided for in
Section 6.07 hereof.
(c) Any successor Indenture Trustee, however appointed, shall
be a "citizen of the United States" within the meaning of Section 40102(a)(15)
of the Federal Aviation Act and shall also be a bank or trust company having a
combined capital and surplus of at least $200,000,000 if there be such an
institution willing, able and legally qualified to perform the duties of the
Indenture Trustee hereunder upon reasonable or customary terms.
(d) Any corporation into which the Indenture Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Indenture
Trustee shall be a party, or any corporation to which substantially all the
corporate trust business of the Indenture Trustee may be transferred, shall,
subject to the terms of paragraph (c) of this Section 8.02, be the Indenture
Trustee under this Indenture without further act. Notwithstanding the foregoing,
upon the request of the Owner Trustee or the Lessee, any such successor
corporation referred to in this Section 8.02(d) shall deliver to the Owner
Trustee and the Lessee an instrument confirming its status as the Indenture
Trustee hereunder and under the other Indenture Documents.
SECTION 8.03. Appointment of Separate Trustees. (a) At any
time or times, for the purpose of meeting any legal requirements of any
jurisdiction in which any part of the Trust Indenture Estate may at the time be
located or in which any action of the Indenture Trustee may be required to be
performed or taken, the Indenture Trustee, by an instrument in writing signed by
it, may appoint one or more individuals or corporations to act as separate
trustee or separate trustees or co-trustee, acting jointly with the Indenture
Trustee, of all or any part of
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the Trust Indenture Estate to the full extent that local law makes it necessary
for such separate trustee or separate trustees or co-trustee acting jointly with
the Indenture Trustee to act.
(b) The Indenture Trustee and, at the request of the Indenture
Trustee, the Owner Trustee, shall execute, acknowledge and deliver all such
instruments as may be required by the legal requirements of any jurisdiction or
by any such separate trustee or separate trustees or co-trustee for the purpose
of more fully confirming such title, rights or duties to such separate trustee
or separate trustees or co-trustee. Upon the acceptance in writing of such
appointment by any such separate trustee or separate trustees or co-trustee, it,
he, she or they shall be vested with such title to the Trust Indenture Estate or
any part thereof, and with such rights and duties, as shall be specified in the
instrument of appointment, jointly with the Indenture Trustee (except insofar as
local law makes it necessary for any such separate trustee or separate trustees
to act alone) subject to all the terms of this Indenture. Any separate trustee
or separate trustees or co-trustee may, at any time by an instrument in writing,
constitute the Indenture Trustee its, his or her attorney-in-fact and agent with
full power and authority to do all acts and things and to exercise all
discretion on its, his or her behalf and in its, his or her name. In case any
such separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, the title to the Trust Indenture Estate and all assets,
property, rights, powers, trusts, obligations and duties of such separate
trustee or co-trustee shall, so far as permitted by law, vest in and be
exercised by the Indenture Trustee, without the appointment of a successor to
such separate trustee or co-trustee unless and until a successor is appointed.
(c) All provisions of this Indenture which are for the benefit
of the Indenture Trustee shall extend to and apply to each separate trustee or
co-trustee appointed pursuant to the foregoing provisions of this Section 8.03,
including without limitation Article VII hereof.
(d) Every additional trustee and separate trustee hereunder
shall, to the extent permitted by law, be appointed and act, and the Indenture
Trustee shall act, subject to the following provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon
the Indenture Trustee in respect of the receipt, custody, investment
and payment of moneys shall be exercised solely by the Indenture
Trustee;
(ii) all other rights, powers, duties and obligations
conferred or imposed upon the Indenture Trustee shall be
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conferred or imposed and exercised or performed by the Indenture
Trustee and such additional trustee or trustees and separate trustee or
trustees jointly except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed,
the Indenture Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Indenture
Estate in any such jurisdiction) shall be exercised and performed by
such additional trustee or trustees or separate trustee or trustees;
(iii) no power hereby given to, or with respect to which it is
hereby provided may be exercised by, any such additional trustee or
separate trustee shall be exercised hereunder by such additional
trustee or separate trustee except jointly with, or with the consent
of, the Indenture Trustee; and
(iv) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder.
If at any time the Indenture Trustee shall deem it no longer necessary or
prudent in order to conform to any such law, the Indenture Trustee shall execute
and deliver an indenture supplemental hereto and all other instruments and
agreements necessary or proper to remove any additional trustee or separate
trustee.
(e) Any request, approval or consent in writing by the
Indenture Trustee to any additional trustee or separate trustee shall be
sufficient warrant to such additional trustee or separate trustee, as the case
may be, to take such action as may be so requested, approved or consented to.
(f) Notwithstanding any other provision of this Section 8.03,
the powers of any additional trustee or separate trustee appointed pursuant to
this Section 8.03 shall not in any case exceed those of the Indenture Trustee
hereunder.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS TO THIS
INDENTURE AND OTHER DOCUMENTS
SECTION 9.01. Lease Amendments and Supplemental Indentures.
(a) Except as otherwise provided in Section 5.10 hereof, and except with respect
to Excepted Payments, the Owner Trustee agrees that it shall not enter into any
amendment of or
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supplement to the Lease, or execute and deliver any written waiver or
modification of, or consent under, the terms of the Lease, unless such
supplement, amendment, waiver, modification or consent is consented to in
writing by the Indenture Trustee acting on instructions of a Majority in
Interest of Note Holders. Anything to the contrary contained in this Section
9.01 notwithstanding, without the necessity of the consent of any of the Note
Holders or (as respects clauses (i) and (ii) below) the Indenture Trustee, (i)
any Excepted Rights or Excepted Payments payable to the Owner Trustee or Owner
Participant may be modified, amended, changed or waived in such manner as shall
be agreed to by the Owner Participant and Lessee, (ii) the Owner Trustee and
Lessee may, so long as no Indenture Event of Default has occurred and is
continuing, enter into amendments of or additions to the Lease to modify
Sections 6(d), 9 and 16 and Exhibits B and E (except to the extent that such
amendment would adversely affect the rights or exercise of remedies under
Section 18 of the Lease) so long as such amendments, modifications and changes
do not and would not (A) affect the time of, or reduce the amount of, Basic Rent
or Stipulated Loss Value payments until after the payment in full of all Secured
Obligations, (B) impair the Lien of this Indenture, (C) adversely affect the
value, utility or useful life of the Aircraft or any Engine or (D) otherwise
adversely affect the Note Holders in any material respect and (iii) the Lessee
may effect the re-registration of the Aircraft in accordance with but always
subject to the terms and conditions applicable thereto specified in Section 11
of the Refunding Agreement and Section 6(e) of the Lease and the Indenture
Trustee may approve any Permitted Sublessee as provided in clause (c) of the
definition of such term set forth in the Lease and may exercise the rights of
the Indenture Trustee under Section 15 of the Refunding Agreement. For the
avoidance of doubt, nothing in this Section 9.01 shall limit in any way the
rights of the Owner Trustee and/or the Owner Participant under Section 5.10(d)
to exercise certain rights and powers under the Lease to the exclusion of the
Indenture Trustee and any Note Holder and without the consent of the Indenture
Trustee or any Note Holder.
The Indenture Trustee is hereby authorized to join in the
execution of any supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer, assignment, mortgage or pledge of any property thereunder,
but the Indenture Trustee shall not be obligated to enter into any such
supplemental indenture which adversely affects the Indenture Trustee's own
rights, duties or immunities under this Indenture or otherwise, whether in its
official or individual capacity.
Any supplemental indenture authorized by the provisions
of this Section 9.01 may be executed without the consent of the
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Note Holders notwithstanding any of the provisions of this Section 9.01.
(b) Without limiting the provisions of Section 9.01(a) hereof
and subject to Sections 5.10(b) and 5.10(d) hereof, the Indenture Trustee agrees
with the Note Holders that it shall not enter into any amendment, waiver or
modification of, supplement or consent to this Indenture, the Lease, the
Refunding Agreement or the other Indenture Documents, or any other agreement
included in the Trust Indenture Estate, unless such supplement, amendment,
waiver, modification or consent is consented to in writing by a Majority in
Interest of Note Holders, or does not adversely affect the Note Holders in any
material respect. Upon the written request of a Majority in Interest of Note
Holders, the Indenture Trustee shall from time to time enter into any such
supplement or amendment, or execute and deliver any such waiver, modification or
consent, as may be specified in such request and as may be (in the case of any
such amendment, supplement or modification), to the extent such agreement is
required, agreed to by the Owner Trustee and Lessee or, as may be appropriate,
the Manufacturer; provided, however, that, without the consent of each Holder of
an affected Equipment Note then outstanding and of each Liquidity Provider, no
such amendment of or supplement to this Indenture, the Lease, the Refunding
Agreement or any other Indenture Document or waiver or modification of the terms
of, or consent under, any thereof, shall (i) modify any of the provisions of
this Section 9.01, or of Section 2.02, 2.10, 2.13, 4.02, 4.04(e), 5.06 or 5.10
hereof, Section 17 (except to add a Lease Event of Default) of the Lease, the
definitions of "Indenture Event of Default", "Indenture Default", "Indenture
Trustee Event", "Lease Event of Default", "Lease Default", "Majority in Interest
of Note Holders", "Make-Whole Amount" or "Note Holder", or the percentage of
Note Holders required to take or approve any action hereunder, (ii) reduce the
amount, or change the time of payment or method of calculation of any amount, of
Principal Amount, Make-Whole Amount, if any, or interest with respect to any
Equipment Note, or alter or modify the provisions of Article III hereof with
respect to the order of priorities in which distribution thereunder shall be
made as among the Note Holders, the Owner Trustee and the Lessee, (iii) reduce,
modify or amend any indemnities in favor of the Note Holders, (iv) consent to
any change in this Indenture or the Lease which would permit redemption of
Equipment Notes earlier than permitted under Section 2.10 hereof, (v) modify any
of the provisions of Section 4(b) of the Lease, or modify, amend or supplement
the Lease, any Assigned Sublease or any Sublease Assignment, or consent to any
assignment of any thereof, in either case releasing the Lessee (or Permitted
Sublessee) from its obligations in respect of the payment of Basic Rent or
Stipulated Loss Value for the Aircraft or altering the absolute and
unconditional character of the obligations of Lessee to pay
Trust Indenture
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Rent as set forth in Sections 4(b) and 4(d) of the Lease (or comparable
provisions in any Assigned Sublease) or (vi) permit the creation of any Lien on
the Trust Indenture Estate or any part thereof other than Permitted Liens or
deprive any Note Holder of the benefit of the Lien of this Indenture on the
Trust Indenture Estate, except as provided in connection with the exercise of
remedies under Article IV hereof.
(c) At any time after the date of the consummation of the
Refinancing Transaction, the Owner Trustee and the Indenture Trustee may enter
into one or more agreements supplemental hereto without the consent of any Note
Holder for any of the following purposes: (i)(A) to cure any defect or
inconsistency herein or in the Equipment Notes, or to make any change not
inconsistent with the provisions hereof (provided that such change does not
adversely affect the interests of any Note Holder in its capacity solely as Note
Holder) or (B) to cure any ambiguity or correct any mistake; (ii) to evidence
the succession of another party as the Owner Trustee in accordance with the
terms of the Trust Agreement or to evidence the succession of a new trustee
hereunder pursuant hereto, the removal of the trustee hereunder or the
appointment of any co-trustee or co-trustees or any separate or additional
trustee or trustees; (iii) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee or to make any other provisions with
respect to matters or questions arising hereunder so long as such action shall
not adversely affect the interests of the Note Holders in its capacity solely as
Note Holder or impose upon the Lessee any additional indemnification
obligations; (iv) to correct or amplify the description of any property at any
time subject to the Lien of this Indenture or better to assure, convey and
confirm unto the Indenture Trustee any property subject or required to be
subject to the Lien of this Indenture, the Airframe or Engines or any
Replacement Airframe or Replacement Engine; (v) to add to the covenants of the
Owner Trustee for the benefit of the Note Holders, or to surrender any rights or
powers herein conferred upon the Owner Trustee, the Owner Participant or the
Lessee; (vi) to add to the rights of the Note Holders; and (vii) to include on
the Equipment Notes any legend as may be required by law.
(d) Without the consent of the Lessee no amendment or
supplement to this Indenture or waiver or modification of the terms hereof shall
adversely affect the Lessee in any material respect or impose upon the Lessee
any additional indemnification obligations.
SECTION 9.02. Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective
Trust Indenture
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rights, limitations of rights, obligations, duties and immunities under this
Indenture of the Indenture Trustee, the Owner Trustee and the Note Holders shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for all and any purposes.
SECTION 9.03. Documents to Be Given to Trustee. The Indenture
Trustee shall be entitled to receive and shall be fully protected in relying
upon an Officers' Certificate and an Opinion of Counsel as conclusive evidence
that any supplemental indenture referred to in Section 9.01 complies with the
applicable provisions of this Indenture.
SECTION 9.04. Notation on Notes in Respect of Supplemental
Indentures. Equipment Notes authenticated and delivered after the execution of
any supplemental indenture pursuant to the provisions of this Article IX may
bear a notation in form approved by the Indenture Trustee as to any matter
provided for by such supplemental indenture. If the Owner Trustee or the
Indenture Trustee shall so determine, new Equipment Notes so modified as to
conform, in the opinion of the Owner Trustee and the Indenture Trustee, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared by the Owner Trustee, authenticated by the Indenture Trustee and
delivered in exchange for the Equipment Notes then outstanding.
SECTION 9.05. Trustees Protected. If, in the opinion of the
institution acting as Owner Trustee under the Trust Agreement or the institution
acting as Indenture Trustee hereunder, any document required to be executed by
it pursuant to the terms of this Article IX affects adversely any right, duty,
immunity or indemnity with respect to such institution under this Indenture,
such institution may in its discretion decline to execute such document.
SECTION 9.06. Documents Mailed to Note Holders. Promptly after
the execution by the Owner Trustee or the Indenture Trustee of any document
entered into pursuant to this Article IX, the Owner Trustee shall mail, by
certified mail, postage prepaid, conformed copies thereof to the Indenture
Trustee (in such quantities as will permit the Indenture Trustee to distribute
one copy to each Note Holder, and the Indenture Trustee shall mail one such copy
to each Note Holder), but the failure of the Owner Trustee or the Indenture
Trustee to mail such conformed copies shall not impair or affect the validity of
such document. The Indenture Trustee will furnish to each Note Holder, promptly
upon receipt thereof, duplicates or copies of
Trust Indenture
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all reports, notices, requests, demands, certificates and other instruments
furnished to the Indenture Trustee under the Lease or hereunder to the extent
that the same were not required to have been furnished to such Note Holder
pursuant hereto or to the Lease.
SECTION 9.07. No Request Necessary for Lease Supplement or
Indenture Supplement. Notwithstanding anything contained in this Article IX, no
written request or consent of the Indenture Trustee, any Note Holder or the
Owner Participant pursuant to this Article IX shall be required to enable the
Owner Trustee to enter into any Lease Supplement with the Lessee pursuant to the
terms of the Lease to subject the Aircraft, any Engines or other property
thereto or to release the Aircraft, any Engine or other property therefrom or to
execute and deliver an Indenture Supplement, in each case pursuant to the terms
hereof.
SECTION 9.08. Notices to Liquidity Provider. Any request made
to any Note Holder for consent to any amendment or supplement pursuant to this
Article IX shall be promptly furnished by the Indenture Trustee to each
Liquidity Provider.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Indenture. Upon payment in full
of the Principal Amount of, Make-Whole Amount, if any, and all accrued and
unpaid interest on and other amounts then due with respect to the Equipment
Notes and provided that there shall then be no other amounts then due to the
Note Holders and the Indenture Trustee hereunder or under the Lease or the
Refunding Agreement or otherwise secured hereby, the Lien of this Indenture
shall be deemed discharged and the security interests in favor of the Indenture
Trustee and the Note Holders hereunder shall terminate, and the Owner Trustee
shall direct the Indenture Trustee to execute and deliver to or as directed in
writing by the Owner Trustee, an appropriate instrument evidencing the discharge
of such Lien and the termination of such security interest in the Aircraft and
release of the Indenture Documents from the assignment and pledge thereof
hereunder, and the Indenture Trustee shall execute and deliver such instrument
as aforesaid and, at the Owner Trustee's expense, will execute and deliver such
other instruments or documents as may be reasonably requested by the Owner
Trustee to give effect to such discharge, termination and release; provided,
however, that this Indenture and the trusts created hereby shall earlier
terminate and this Indenture shall be of no further force or effect as expressly
provided pursuant to Article X hereof or upon any sale or other final
disposition by the Indenture Trustee of all property part
Trust Indenture
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of the Trust Indenture Estate and the final distribution by the Indenture
Trustee of all moneys or other property or proceeds constituting part of the
Trust Indenture Estate in accordance with the terms hereof. Except as aforesaid
otherwise provided, this Indenture and the trusts created hereby shall continue
in full force and effect in accordance with the terms hereof.
SECTION 10.02. No Legal Title to Trust Indenture Estate in
Note Holders. No Note Holder shall have legal title to any part of the Trust
Indenture Estate. No transfer, by operation of law or otherwise, of any
Equipment Note or other right, title and interest of any Note Holder in and to
the Trust Indenture Estate or hereunder shall operate to terminate this
Indenture or entitle such Note Holder or any successor or transferee of such
Holder to an accounting or to the transfer to it of legal title to any part of
the Trust Indenture Estate.
SECTION 10.03. Sale of Aircraft by Indenture Trustee is
Binding. Any sale or other conveyance of the Aircraft by the Indenture Trustee
made pursuant to the terms of this Indenture or of the Lease shall bind the Note
Holders and shall be effective to transfer or convey all right, title and
interest of the Indenture Trustee, the Owner Trustee, the Owner Participant and
such Holders in and to the Aircraft. No purchaser or other grantee shall be
required to inquire as to the authorization, necessity, expediency or regularity
of such sale or conveyance or as to the application of any sale or other
proceeds with respect thereto by the Indenture Trustee.
SECTION 10.04. Indenture for Benefit of Owner Trustee,
Indenture Trustee, Owner Participant, Lessee and Note Holders. Nothing in this
Indenture, whether express or implied, shall be construed to give to any Person
other than the Owner Trustee, the Indenture Trustee, the Owner Participant, the
Note Holders, the Lessee and, with respect to any provisions hereof requiring
payment to any Permitted Sublessee, such Permitted Sublessee, any legal or
equitable right, remedy or claim under or in respect of this Indenture.
SECTION 10.05. No Action Contrary to Lessee's Rights Under the
Lease. Notwithstanding any of the provisions of this Indenture or the Trust
Agreement to the contrary, each of the Note Holders, the Indenture Trustee and
the Owner Trustee agrees for the benefit of the Lessee that it will not take any
action contrary to the Lessee's rights under the Lease, including the right of
the Lessee to possession and use and quiet enjoyment of the Aircraft, except in
accordance with the provisions of the Lease.
SECTION 10.06. Notices. Unless otherwise expressly
specified herein, all notices, requests, demands, authorizations,
Trust Indenture
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directions, consents, waivers or documents required or permitted by the terms of
this Indenture shall be in English and in writing, mailed by first-class
registered or certified mail, postage prepaid, or by confirmed telex or
telecopy, and (i) if to the Owner Trustee, addressed to it at its office at
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Administration Department (telex: 835437; answerback: WILMTR; telecopy: (302)
651-8464/8882), with a copy to the Owner Participant at its address set forth in
the Refunding Agreement, (ii) if to the Indenture Trustee, addressed to it at
its office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate
Trust Administration (telex: 99339; answerback: CTNB-HTFD; telecopy: (203)
240-7920) or (iii) if to the Owner Participant, the Lessee or any Note Holder,
addressed to such party at such address as such party shall have furnished by
notice to the Owner Trustee and the Indenture Trustee, or, until an address is
so furnished, addressed to the address of such party (if any) set forth on the
signature pages to the Refunding Agreement or in the Register. Whenever any
notice in writing is required to be given by the Owner Trustee or the Indenture
Trustee or any Note Holder to any of the other of them, such notice shall be
deemed and such requirement satisfied when such notice is received. Any party
hereto may change the address to which notices to such party will be sent by
giving notice of such change to the other parties to this Indenture.
SECTION 10.07. Severability. Any provision of this Indenture
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 10.08. No Oral Modifications or Continuing Waivers. No
terms or provisions of this Indenture or the Equipment Notes may be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party or other Person against whom enforcement of the change,
waiver, discharge or termination is sought; and any waiver of the terms hereof
or of any Equipment Note shall be effective only in the specific instance and
for the specific purpose given.
SECTION 10.09. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
each of the parties hereto and the successors and permitted assigns of each, all
as herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by any Note Holder shall bind the successors and assigns of
such Note Holder. This Indenture and the Trust
Trust Indenture
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Indenture Estate shall not be affected by any amendment or supplement to the
Trust Agreement or by any other action taken under or in respect of the Trust
Agreement, except that each reference in this Indenture to the Trust Agreement
shall mean the Trust Agreement as amended and supplemented from time to time to
the extent permitted hereby and thereby. Each Note Holder by its acceptance of
an Equipment Note agrees to be bound by this Indenture and all provisions of the
Refunding Agreement applicable to a Note Holder.
SECTION 10.10. Headings. The headings of the various Articles
and Sections herein and in the table of contents hereto are for the convenience
of reference only and shall not define or limit any of the terms or provisions
hereof.
SECTION 10.11. Normal Commercial Relations. Anything contained
in this Indenture to the contrary notwithstanding, the Indenture Trustee, the
Owner Trustee, the Owner Participant, any Note Holder or any bank or other
Affiliate of any of them may conduct any banking or other financial
transactions, and have banking or other commercial relationships, with the
Lessee or any Permitted Sublessee fully to the same extent as if this Indenture
were not in effect, including without limitation the making of loans or other
extensions of credit to the Lessee for any purpose whatsoever, whether related
to any of the transactions contemplated hereby or otherwise.
SECTION 10.12. Governing Law; Counterpart Form. THIS INDENTURE
AND THE EQUIPMENT NOTES ISSUED HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING
ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. This Indenture 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 10.13. Section 1110. It is the intention of the
parties that the Owner Trustee, as lessor under the Lease (and the Indenture
Trustee as assignee of the Owner Trustee's rights hereunder), shall be entitled
to the benefits of Section 1110 of the Bankruptcy Code with respect to the right
to take possession of the Aircraft, Airframe, Engines and Parts as provided in
the Lease in the event of a case under Chapter 11 of the Bankruptcy Code in
which Lessee is a debtor, and in any instance where more than one construction
is possible of the terms and conditions hereof or of any other pertinent
Operative Document, each such party agrees that a construction which would
preserve such benefits shall control over any construction which would not
preserve such benefits.
Trust Indenture
95
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture, as amended and restated, to be duly executed by their respective
officers thereunto duly authorized, as of the day and year first above written,
and acknowledge that this Indenture has been made and delivered in The City of
New York.
WILMINGTON TRUST COMPANY,
not in its individual capacity,
except as expressly provided
herein, but solely as Owner
Trustee
By
-------------------------------
Title:
FLEET NATIONAL BANK,
not in its individual capacity,
except as expressly provided
herein, but solely as Indenture
Trustee
By
-------------------------------
Title:
Trust Indenture
96
EXHIBIT A
TO
FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1990 AWA-14]
TRUST INDENTURE SUPPLEMENT NO. _____
[GPA 1990 AWA-14]
TRUST INDENTURE SUPPLEMENT NO. _____ dated __________, ___ of
WILMINGTON TRUST COMPANY, not in its individual capacity but solely as owner
trustee (the "Owner Trustee") under the Trust Agreement [GPA 1990 AWA-14] dated
as of September 21, 1990 (as amended, the "Trust Agreement") between Wilmington
Trust Company and the Owner Participant named therein.
W I T N E S S E T H :
WHEREAS, the Trust Indenture and Security Agreement [GPA 1990
AWA-14] dated as of September 21, 1990, as amended and restated as of November
26, 1996 (as so amended and restated, the "Indenture") between the Owner Trustee
and Fleet National Bank (formerly known as Fleet National Bank of Connecticut,
Shawmut Bank Connecticut, National Association, and The Connecticut National
Bank), as Indenture Trustee (the "Indenture Trustee"), provides for the
execution and delivery of a supplement thereto substantially in the form hereof
which shall particularly describe the Aircraft (such term and other defined
terms in the Indenture being herein used with the same meanings) and any
Replacement Airframe or Replacement Engine included in the Trust Indenture
Estate, and shall specifically mortgage such Aircraft, Replacement Airframe or
Replacement Engine, as the case may be, to the Indenture Trustee.
WHEREAS, the Original Indenture, as supplemented by Trust
Indenture Supplement No. 1 dated September 28, 1990, as amended by Amendment No.
1 dated March 27, 1992, and as further amended by Amendment No. 2 dated as of
July 29, 1993, subjected to the Lien of such Original Indenture the airframe and
engines therein described, which Original Indenture and Trust Indenture
Supplement No. 1 have been duly recorded with the Federal Aviation
Administration as one document on September 28, 1990 and assigned Conveyance No.
E10184, which Amendment No. 1 has been duly recorded with the Federal Aviation
Administration on May 18, 1992 and assigned Conveyance No. EE003011 and which
Amendment No. 2 has been duly recorded with the Federal Aviation Administration
on August 4, 1993 and assigned Conveyance No. F59674.
97
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WHEREAS(1), the Indenture relates to the Airframe and Engines
described below and a counterpart of the Indenture is attached hereto and made a
part hereof and this Indenture Supplement, together with such counterpart of the
Indenture, is being filed for recordation on the date hereof with the Federal
Aviation Administration as one document.
WHEREAS(2), the Owner Trustee has, as provided in the
Indenture, heretofore executed and delivered to the Indenture Trustee [(3)]
Indenture Supplement(s) for the purpose of specifically subjecting to the Lien
of the Indenture certain airframes and/or engines therein described, which
Indenture Supplement(s) is (are) dated and has (have) been duly recorded with
the Federal Aviation Administration as set forth below, to wit:
Date Recordation Date FAA Document No.
NOW, THEREFORE, This Supplement Witnesseth, that, to secure
the prompt payment of the Principal Amount of, interest on, Make-Whole Amount,
if any, and all other amounts due with respect to, all Equipment Notes from time
to time outstanding under the Indenture and the performance and observance by
the Owner Trustee of all the agreements, covenants and provisions contained in
the Indenture and the Refunding Agreement and the Equipment Notes, for the
benefit of the Note Holders, and the prompt payment of any and all amounts from
time to time owing under the Refunding Agreement by the Owner Trustee, the Owner
Participant and the Lessee in each case to the Note Holders and for the uses and
purposes and subject to the terms and provisions of the Indenture, and in
consideration of the premises and of the covenants contained in the Indenture,
and of the acceptance of the Equipment Notes by the Holders thereof, and of the
sum of $1 paid to the Owner Trustee by the Indenture Trustee at or before the
delivery of the Indenture, the receipt whereof is hereby acknowledged, the Owner
Trustee has granted, bargained, sold, assigned, transferred, conveyed,
mortgaged, pledged and
--------
(1) This recital is to be included only in the first Indenture Supplement
(including the first Indenture Supplement filed with respect to the
Indenture).
(2) This recital not to be included in the first Indenture
Supplement.
(3) Insert appropriate number.
Form of Trust Indenture Supplement
98
- 3 -
confirmed, and does hereby grant, bargain, sell, assign, transfer, convey,
mortgage, pledge and confirm, unto the Indenture Trustee, its successors and
assigns, for the security and benefit of the Note Holders from time to time, in
the trust created by the Indenture, a first priority security interest in and
mortgage Lien on all estate, right, title and interest of the Owner Trustee in,
to and under the following described property:
AIRFRAME(S)
( ) airframe(s) identified as follows:
FAA Registration Manufacturer's
Manufacturer Model Number Serial Number
together with all appliances, equipment, instruments and accessories (including,
without limitation, radio and radar) from time to time thereto belonging, owned
by the Owner Trustee and installed in or appurtenant to said aircraft.
AIRCRAFT ENGINES
( ) aircraft engines, each such engine
having 750 or more rated takeoff horsepower
or the equivalent thereof, identified as
follows:
Manufacturer's
Manufacturer Model Serial Number
together with all equipment and accessories thereto belonging, by whomsoever
manufactured, owned by the Owner Trustee and installed in or appurtenant to said
aircraft engines.
Together with all substitutions, replacements and renewals of
the property above described, and all property which shall hereafter become
physically attached to or incorporated in the property above described, whether
the same are now owned by the Owner Trustee or shall hereafter be acquired by
it.
As further security for the obligations referred to above and
secured by the Indenture and hereby, the Owner Trustee has granted, bargained,
sold, assigned, transferred, conveyed, mortgaged, pledged and confirmed, and
does hereby grant, bargain,
Form of Trust Indenture Supplement
99
- 4 -
sell, assign, transfer, convey, mortgage, pledge and confirm, unto the Indenture
Trustee, its successors and assigns, for the security and benefit of the Note
Holders from time to time, in the trust created by the Indenture, all of the
estate, right, title and interest of the Owner Trustee in, to and under the
Lease and Lease Supplement [GPA 1990 AWA-14] No. 3 of even date herewith (other
than Excepted Payments and Excepted Rights) covering the property described
above.
TO HAVE AND TO HOLD all and singular the aforesaid property
unto the Indenture Trustee, its successors and assigns, for the benefit and
security of the Note Holders from time to time for the uses and purposes and
subject to the terms and provisions set forth in the Indenture.
This Supplement shall be construed as supplemental to the
Indenture and shall form a part of it, and the Indenture is hereby incorporated
by reference herein and is hereby ratified, approved and confirmed.
This Supplement is being delivered in the State of New York.
AND, FURTHER, the Owner Trustee hereby acknowledges that the
Aircraft and/or Engines referred to in this 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, subject to the pledge and mortgage thereof under the Indenture.
Form of Trust Indenture Supplement
100
- 5 -
IN WITNESS WHEREOF, the Owner Trustee has caused this
Supplement to be duly executed by one of its officers thereunto duly authorized
on the day and year first above written.
WILMINGTON TRUST COMPANY, not
in its individual capacity,
except as otherwise expressly
provided herein, but solely as
Owner Trustee
By____________________________
Title:
Form of Trust Indenture Supplement
101
SCHEDULE I
TO
FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1990 AWA-14]
MATURITY
PRINCIPAL AMOUNT DATE DEBT RATE
---------------- -------- ---------
Series A $11,897,518 02-Jan-2009 6.85%
Series B $ 4,413,774 02-Jul-2005 6.93%
Series C $ 4,552,621 02-Jan-2002 6.86%
Series D $ 4,249,113 02-Jan-2002 8.16%
Series E $ 2,541,597 02-Jul-2002 10.50%
102
EQUIPMENT NOTES AMORTIZATION
SERIES A
Aircraft: N635AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
103
- 2 -
SERIES B
Aircraft: N635AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
104
- 3 -
SERIES C
Aircraft: N635AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
105
- 4 -
SERIES D
Aircraft: N635AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
106
- 5 -
SERIES E
Aircraft: N635AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
107
SCHEDULE II
TO
FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1990 AWA-14]
PASS THROUGH TRUST AGREEMENTS
1. Pass Through Trust Agreement, dated as of November 26, 1996,
between America West Airlines, Inc., and Fleet National
Bank, as supplemented by Trust Supplement No. 1996-1A, dated
November 26, 1996.
2. Pass Through Trust Agreement, dated as of November 26, 1996,
between America West Airlines, Inc., and Fleet National
Bank, as supplemented by Trust Supplement No. 1996-1B, dated
November 26, 1996.
3. Pass Through Trust Agreement, dated as of November 26, 1996,
between America West Airlines, Inc., and Fleet National
Bank, as supplemented by Trust Supplement No. 1996-1C, dated
November 26, 1996.
4. Pass Through Trust Agreement, dated as of November 26, 1996,
between America West Airlines, Inc., and Fleet National
Bank, as supplemented by Trust Supplement No. 1996-1D, dated
November 26, 1996.
5. Pass Through Trust Agreement, dated as of November 26, 1996,
between America West Airlines, Inc., and Fleet National
Bank, as supplemented by Trust Supplement No. 1996-1E, dated
November 26, 1996.
Schedule II