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EXHIBIT 4.36
FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-12]
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
THE CHASE MANHATTAN 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 ▇▇. ▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇
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........................................ 46
SECTION 3.06. Payments to Owner Trustee............................. 47
SECTION 3.07. Investment of Amounts Held by Indenture
Trustee......................................... 47
(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......................................... 48
SECTION 4.02. Indenture Events of Default........................... 49
SECTION 4.03. Certain Rights........................................ 52
SECTION 4.04. Remedies.............................................. 54
SECTION 4.05. Return of the Aircraft, etc........................... 57
SECTION 4.06. Remedies Cumulative................................... 59
SECTION 4.07. Discontinuance of Proceedings......................... 59
SECTION 4.08. Waiver of Past Indenture Defaults..................... 60
SECTION 4.09. Exercise of Remedies by Foreign Note
Holders......................................... 60
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Indenture Event of Default.................. 60
SECTION 5.02. Action Upon Instructions.............................. 62
SECTION 5.03. Indemnification....................................... 62
SECTION 5.04. No Duties Except as Specified in
Indenture or Instructions....................... 63
SECTION 5.05. No Action Except Under Lease, Refunding
Agreement, Indenture or Instructions............ 63
SECTION 5.06. Replacement Airframes, Replacement
Engines and Replacement Parts................... 64
SECTION 5.07. Indenture Supplements for Replacements................ 67
SECTION 5.08. Effect of Replacement................................. 68
SECTION 5.09. Notices, etc.......................................... 68
SECTION 5.10. Certain Rights of Owner Trustee and
Owner Participant............................... 68
SECTION 5.11. Evidence of Action Taken by Note Holder............... 71
SECTION 5.12. Right of Revocation of Action Taken................... 71
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties....................... 71
SECTION 6.02. Absence of Duties..................................... 72
SECTION 6.03. No Representations or Warranties as to
Aircraft or Documents........................... 72
SECTION 6.04. No Segregation of Moneys; No Interest................. 73
(ii)
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Page
SECTION 6.05. Reliance; Agents; Advice of Counsel................... 73
SECTION 6.06. Capacity in Which Acting.............................. 74
SECTION 6.07. Compensation.......................................... 74
SECTION 6.08. May Become Note Holder................................ 75
SECTION 6.09. Further Assurances; Financing State-
ments........................................... 75
ARTICLE VII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification.............................. 75
SECTION 7.02. Exculpation and Release of Liability.................. 76
ARTICLE VIII
SUCCESSOR TRUSTEES AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee..................... 77
SECTION 8.02. Resignation and Removal of Indenture
Trustee; Appointment of Successor............... 77
SECTION 8.03. Appointment of Separate Trustees...................... 78
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...................... 84
SECTION 9.04. Notation on Notes in Respect of
Supplemental Indentures......................... 84
SECTION 9.05. Trustees Protected.................................... 84
SECTION 9.06. Documents Mailed to Note Holders...................... 84
SECTION 9.07. No Request Necessary for Lease
Supplement or Indenture Supplement.............. 85
SECTION 9.08. Notices to Liquidity Provider......................... 85
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Indenture............................. 85
SECTION 10.02. No Legal Title to Trust Indenture
Estate in Note Holders......................... 86
(iii)
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SECTION 10.03. Sale of Aircraft by Indenture Trustee
is Binding..................................... 86
SECTION 10.04. Indenture for Benefit of Owner Trustee,
Indenture Trustee, Owner Participant,
Lessee and Note Holders........................ 86
SECTION 10.05. No Action Contrary to Lessee's Rights
Under the Lease................................ 86
SECTION 10.06. Notices.............................................. 87
SECTION 10.07. Severability......................................... 87
SECTION 10.08. No Oral Modifications or Continuing
Waivers........................................ 87
SECTION 10.09. Successors and Assigns............................... 88
SECTION 10.10. Headings............................................. 88
SECTION 10.11. Normal Commercial Relations.......................... 88
SECTION 10.12. Governing Law; Counterpart Form...................... 88
SECTION 10.13. Section 1110......................................... 88
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 1989 BN-12]
FIRST AMENDED AND RESTATED TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-12] (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 THE CHASE MANHATTAN BANK (formerly known as Chemical Bank,
successor by merger to Manufacturers Hanover Trust Company), a New York
corporation, 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 1989 BN-12] dated as of December 19, 1989, as
supplemented by Trust Agreement Supplement [GPA 1989 BN-12] No. 1 dated December
28, 1989, and as further supplemented by Trust Agreement Supplement [GPA 1989
BN-12] 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 1989 BN-12] dated as of
December 19, 1989, as supplemented by Trust Indenture Supplement No. 1 dated
December 28, 1989, which were recorded by the Federal Aviation Administration on
January 2, 1990 as one instrument and assigned Conveyance No. V78636 (as so
amended, supplemented or otherwise modified to the date hereof, the "Original
Indenture"), (ii) the Owner Trustee
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and the Original Head Lessee entered into the Aircraft Lease Agreement [GPA 1989
BN-12] dated as of December 19, 1989, as supplemented by Lease Supplement [GPA
1989 BN-12] No. 1 dated December 28, 1989, which were recorded by the Federal
Aviation Administration on January 2, 1990 as one instrument and assigned
Conveyance No. V78637, as further supplemented by Lease Supplement [GPA 1989
BN-12] No. 2 dated as of 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 1989 BN-12] 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 1989 BN-12] 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
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;
Trust Indenture
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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 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
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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 Warranty Assignment); the Purchase
Agreement Warranty Assignment, with the Consents and Agreements attached
thereto; the Second Warranty ▇▇▇▇ of Sale; the BFE ▇▇▇▇ of Sale; 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 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
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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 paper original executed
counterparts of the Original Lease and Lease Supplement No. 1, certified copies
of the Purchase Agreement Warranty Assignment and the Consents and Agreements
attached thereto, and the original Second Aircraft Warranty ▇▇▇▇ of Sale and the
BFE ▇▇▇▇ of Sale. The Owner Trustee thereafter
Trust Indenture
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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 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
Trust Indenture
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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 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
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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 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
Trust Indenture
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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. Sections 101 et seq., as amended.
"Bills of Sale" means the FAA Bills of Sale and the Warranty ▇▇▇▇ of
Sale.
"BFE ▇▇▇▇ of Sale" means the full warranty (as to title) ▇▇▇▇ of
sale covering the Buyer Furnished Equipment, executed by the ▇▇▇▇▇▇▇,
Inc., a Nevada corporation in favor of the Owner Trustee, dated on or
prior to December 28, 1989.
"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
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amounts drawn under one or more Liquidity Facilities 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 Department, 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 and
Series D, the rate per annum specified for such Series under the heading
"Debt Rate" in Schedule I to this Indenture.
"Delivery Date" means December 28, 1989.
"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
Trust Indenture
16
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securities of such depository institution has a long-term 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
Trust Indenture
17
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Section 10 of the Lease or by the Lessee or the Parent 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 Warranty Assignment); the Purchase Agreement
Warranty Assignment and the Consents and Agreements attached thereto; the
Second Aircraft Warranty ▇▇▇▇ of Sale; the BFE ▇▇▇▇ of Sale; 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,
Trust Indenture
19
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supplemented or otherwise modified from time to time in accordance with
its terms.
"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 December 28, 1989,
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 1989 BN-12] dated
as of the date hereof and Amended and Restated Aircraft Lease Agreement
[GPA 1989 BN-12] dated as of the date hereof and supplemented by Lease
Supplement [GPA 1989 BN-12] 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.
Trust Indenture
20
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"Lessee" means America West Airlines, Inc., a Delaware corporation,
in its capacity as lessee under the Amended and 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 and Series D 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
Trust Indenture
21
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either as determined by interpolation between the most recent weekly
average yield to maturity for two series 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 1989 BN-12] dated as of December 19, 1989, as supplemented
by Trust Indenture Supplement No. 1 dated December 28, 1989, which were
recorded as one instrument by the FAA on January 2, 1990 and assigned
Conveyance No. V78636.
"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 1989 BN-12] 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 four 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 four 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 Business Day, the
immediately succeeding Business Day) until the Equipment Notes have been
paid in full.
Trust Indenture
23
- 18 -
"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 1989 BN-12], 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 Warranty Assignment" means the Purchase
Agreement Warranty Assignment [GPA 1989 BN-12], 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 1989 BN-12]
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.
"Registrar" has the meaning set forth in Section 2.07 hereof.
Trust Indenture
24
- 19 -
"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.
"Second Aircraft Warranty ▇▇▇▇ of Sale" means the full warranty (as
to title) ▇▇▇▇ of sale covering the Aircraft (excluding all of the Buyer
Furnished Equipment to be covered by the BFE ▇▇▇▇ of Sale) executed by the
Original Head Lessee in favor of the Owner Trustee, dated December 28,
1989.
"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."
"Sublease Assignment" means a sublease assignment by the Lessee in
favor of the Owner Trustee (including the
Trust Indenture
25
- 20 -
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
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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 1989 BN-12]
DATED AS OF DECEMBER 19, 1989, AS AMENDED.
SERIES [A/B/C/D] NON-RECOURSE EQUIPMENT NOTE DUE [ ]
ISSUED IN CONNECTION WITH ONE AIRBUS ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ REGISTRATION NUMBER N633AW.
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 1989 BN-12], dated as of December 19, 1989, 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
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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 1989 BN-12], dated as
of November 26, 1996, between the Owner Trustee and The Chase Manhattan Bank
(formerly known as Chemical Bank, successor by merger to Manufacturers Hanover
Trust Company), a New York corporation (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), 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 the subordination as
--------
(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.
Trust Indenture
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provided in the Indenture and (c) appoints the Indenture Trustee his
attorney-in-fact for such purpose.](4)
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.
THE CHASE MANHATTAN BANK,
as Indenture Trustee
By:_______________________________
Name:
Title:
--------
(4) To be inserted in the case of a Series B, Series C or Series D.
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 four
separate series consisting of Series A, Series B, Series C and Series D 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
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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
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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" 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" 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 individuals who were at any time the proper officers of the Owner
Trust Indenture
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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 other
agreements to the contrary notwithstanding (except for any
Trust Indenture
35
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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 Section 2.03(b)
shall prevent a Note Holder or the Indenture
Trust Indenture
36
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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 funds were received after
12:00 noon, New York City time, at the
Trust Indenture
▇▇
- ▇▇ -
▇▇▇▇▇ 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 such form prior to the date of such payment (and the
Indenture
Trust Indenture
38
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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
Trust Indenture
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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 and (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.
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 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
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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; and
(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
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.
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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
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
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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, 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
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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;
(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;
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(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; and
(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 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
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.
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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 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,
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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 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
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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.
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
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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;
(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
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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 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
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(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 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
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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 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
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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 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
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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
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
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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 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
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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 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
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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 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
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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 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,
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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 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
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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, 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
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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), 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.
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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, 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
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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 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
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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.
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
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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 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
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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 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;
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(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 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
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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 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
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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 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;
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(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 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.
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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 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 shall be answerable or accountable under
any circumstances, except for their own willful misconduct or gross negligence
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(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, 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,
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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 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 Second Aircraft 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
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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 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 through agents or attorneys and except that any such execution or performance
shall not derogate from the Indenture Trustee's obligations under the third
sentence of Section 2.04(a), the Indenture Trustee and the Owner Trustee 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
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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.
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 from and after the
Restatement Date (whether or not also agreed to be
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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, 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
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(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 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
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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 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
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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 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
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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 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.
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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 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
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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 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
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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 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.
Trust Indenture
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(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 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
Trust Indenture
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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 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
Trust Indenture
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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 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
Trust Indenture
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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, 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: (▇▇▇) ▇▇▇-▇▇▇▇/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 Department
(telecopy: (▇▇▇) ▇▇▇-▇▇▇▇) 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
Trust Indenture
93
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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 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
Trust Indenture
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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:
THE CHASE MANHATTAN 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 1989 BN-12]
TRUST INDENTURE SUPPLEMENT NO. _____
[GPA 1989 BN-12]
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 1989 BN-12] dated
as of December 19, 1989 (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 1989 BN-12]
dated as of December 19, 1989, as amended and restated as of November 26, 1996
(as so amended and restated, the "Indenture") between the Owner Trustee and The
Chase Manhattan Bank (formerly known as Chemical Bank, successor by merger to
Manufacturers Hanover Trust Company), 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(1), the Original Indenture, as supplemented by Trust
Indenture Supplement No. 1 dated December 28, 1989, 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 January 2, 1990 and
assigned Conveyance No. V78636.
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.
--------
(1) This recital is to be included only in the first Indenture Supplement
(including the first Indenture Supplement filed with respect to the
Indenture).
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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 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:
--------
(2) This recital not to be included in the first Indenture Supplement.
(3) Insert appropriate number.
Form of Trust Indenture Supplement
98
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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, 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 1989 BN-12] No. 3
of even date herewith (other than Excepted Payments and Excepted Rights)
covering the property described above.
Form of Trust Indenture Supplement
99
- 4 -
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 1989 BN-12]
MATURITY
PRINCIPAL AMOUNT DATE DEBT RATE
---------------- ----------- ---------
Series A $12,089,958 02-Jan-2009 6.85%
Series B $ 4,533,177 02-Jan-2008 6.93%
Series C $ 4,532,787 02-Jul-2004 6.86%
Series D $ 1,711,069 02-Jan-98 8.16%
102
EQUIPMENT NOTES AMORTIZATION
SERIES A
Aircraft: N633AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
---------------- ----------------------
103
- 2 -
SERIES B
Aircraft: N633AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
---------------- ----------------------
104
- 3 -
SERIES C
Aircraft: N633AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
---------------- ----------------------
105
- 4 -
SERIES D
Aircraft: N633AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
---------------- ----------------------
106
SCHEDULE II
TO
FIRST AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-12]
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.
Schedule II