ISDA ® International Swaps and Derivatives Association, Inc. SCHEDULE to the Master Agreement dated as of June 9, 2006 between
(Multicurrency
- Cross Border)
ISDA ®
International
Swaps and Derivatives Association, Inc.
SCHEDULE
to
the
Master
Agreement
dated
as
of June 9, 2006
between
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▇▇▇▇▇▇
▇▇▇▇▇▇▇ Capital Services Inc.,
a corporation
organized under the laws of the State of Delaware
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and
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Wilmington
Trust Company,
a
Delaware banking corporation, in its capacity as Subordination Agent
on
behalf of the Trustee under the Continental Airlines Pass Through
Trust
2006-1G
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(“Party A”)
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(“Party
B”)
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Part
1
Termination
Provisions
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(a)
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Specified
Entity. None.
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(b)
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Specified
Transaction. Specified
Transaction will have the meaning specified in Section
14.
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(c)
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Events
of Default.
The “Events of Default” set forth in Section 5(a) will not apply to Party
B but will apply to Party A (subject to clause (d)
below).
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(d)
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Cross
Default. The
“Cross Default” provision of Section 5(a)(vi) will not apply.
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(e)
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Termination
Events. The
“Illegality” provisions of Section 5(b)(i), the “Tax Event” provisions of
Section 5(b)(ii), the “Tax Event Upon Merger” provisions of Section
5(b)(iii) and the “Credit Event Upon Merger” provisions of Section
5(b)(iv) will apply to Party A but will not apply to Party B. Party
A
shall be the sole Affected Party (under Section 5(b)(i), (ii) and
5(b)(iv)) and the sole Burdened Party (under Section 5(b)(iii)) with
respect to a Termination Event.
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(f)
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Credit
Event Upon Merger.
The “Credit Event Upon Merger” provisions in Section 5(b)(iv) are hereby
amended by: (I) deleting in the fourth line thereof the words “another
entity” and replacing them with the words “or reorganizes, incorporates,
reincorporates, reconstitutes, or reforms into or as, or receives
all or
substantially all of the assets and/or liabilities or obligations
of,
another entity or X, such Credit Support Provider, or such Specified
Entity, as the case may be,”; (II) deleting in the fifth line thereof the
words “the resulting, surviving or transferee” and replacing them with the
words “X, such Credit Support Provider, or such Specified Entity, as the
case may be, or any resulting, surviving, transferee, reorganized,
reconstituted or reformed”; and
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(III)
deleting in the seventh line thereof the words “its successor or transferee” and
replacing them with the words “any resulting, surviving, transferee,
reorganized, reconstituted or reformed entity”.
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(g)
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Automatic
Early Termination. The
“Automatic Early Termination” provision of Section 6(a) will not
apply.
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(h)
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Right
to Terminate Following Termination Event.
Sections 6(b)(ii)-(iv) are deleted in their entirety and replaced
by the
following:
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“(ii)
Replacement
on Termination Event.
Upon the
occurrence of a Termination Event with respect to Party A, Party A shall
have
the right within 20 days of the date of such Termination Event, at its own
expense, to arrange for one or more Replacement Above-Cap Liquidity Providers
to
enter into and deliver to Party B a Replacement Above-Cap Liquidity Facility
for
such Above-Cap Liquidity Facility. If Party A does not arrange for such
replacement and if the Above-Cap Liquidity Facility has not otherwise been
replaced by Continental Airlines, Inc. (at the expense of Continental Airlines,
Inc.) in accordance with the terms of Section 3.5(c)(iv) of the Intercreditor
Agreement, such 20th
day (or
if such 20th
day is
not a Business Day, the next succeeding Business Day) shall be designated
an
“Early Termination Date” and Party A shall make a termination payment to Party B
in accordance with Part 1(j) of this Schedule. For the avoidance of doubt,
Party
B shall have no right to designate an Early Termination Date following the
occurrence of any Termination Event.”
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(i)
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Calculations.
The
“Payment Date” provisions in Section 6(d)(ii) are deleted in their
entirety and replaced by the
following:
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“The
Termination Amount calculated as being due in respect of any Early Termination
Date under Section 6(e) will be payable on such Early Termination
Date.”
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(j)
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Payments
on Early Termination. Section
6(e) is deleted in its entirety and replaced with the following:
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“Upon
the
designation or deemed designation of an Early Termination Date, including
pursuant to clause 4(i) or (ii) of the Confirmation, with respect to the
Transaction evidenced by the Confirmation, Party A shall make a termination
payment to Party B on the Early Termination Date in an amount equal to the
“Termination Amount” for the Early Termination Date for credit to the Above-Cap
Collateral Account (as provided in Section 3.5(f) of the Intercreditor
Agreement) to be applied as set forth in such Section 3.5(f) plus all Unpaid
Amounts due and payable by Party A under the Confirmation on or prior to the
Early Termination Date and upon such payments the Transaction evidenced by
the
Confirmation shall terminate.”
“Termination
Amount”
means,
for any Early Termination Date, the amount obtained by solving the following
formula for TA:
TA
=
(20%
per
annum - CR) x N x F
where
CR
=
the
Cap
Rate designated in the Confirmation
N
=
the
Notional Amount for such date
2
F
= 0.256
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(k)
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Termination
Currency. “Termination
Currency” means United States
Dollars.
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(l)
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Additional
Termination Event. Additional
Termination Event will not apply.
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(m)
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Limitations
on Conditions Precedent.
Notwithstanding Section 2(a), the obligation of Party A to make each
payment specified in the Confirmation shall not be subject to any
conditions precedent other than as specified in such Confirmation,
and,
without limiting the foregoing, Party A agrees that it will make
each such
payment without offset, counterclaim or
defense.
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Part
2
Tax
Representations
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(a)
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Payer
Tax Representations. For
the purpose of Section 3(e), Party A and Party B each make the following
representation:
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It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e) or 6(e)) to be made by it to the other party
under this Agreement. In making this representation, it may rely
on:
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(i)
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the
accuracy of any representation made by the other party pursuant to
Section 3(f);
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(ii)
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the
satisfaction of the agreement of the other party contained in Section
4(a)(i) or 4(a)(iii) and the accuracy and effectiveness of any document
provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii);
and
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(iii)
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the
satisfaction of the agreement of the other party contained in Section
4(d);
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provided
that it shall not be a breach of this representation where reliance is placed
on
clause (ii), and the other party does not deliver a form or document under
Section 4(a)(iii) by reason of material prejudice to its legal or commercial
position.
| (b) |
Payee
Tax Representations. For
the purpose of Section 3(f),
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(i)
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Party
A represents that it is a corporation organized under the laws of
the
State of Delaware.
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(ii)
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Party
B represents that it is a Delaware banking
corporation.
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Part
3
Agreement
to Deliver Documents
For
the
purpose of Section 4(a)(ii) of this Agreement, each party agrees to deliver
the
following documents, as applicable:
3
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Party
required to
deliver
documents
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Form/Document/
Certificate
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Date
by which to be
delivered
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Covered
by
Section
3(d)
Representation
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|||
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Party
A and Party B
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Evidence
reasonably satisfactory to the other party as to the names, true
signatures and authority of the officer or officials signing this
Agreement or the Confirmation on its behalf
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Upon
execution of this Agreement and the related Confirmation
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Yes
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Party
A
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Opinions
of counsel to Party A and its Credit Support Provider reasonably
satisfactory in form and substance to Party B with respect to this
Agreement and the Credit Support Document specified in Part
4(e)
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Upon
execution of this Agreement
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No
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|||
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Party
B
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Certified
copies of all documents evidencing the necessary corporate authorizations
and approvals with respect to the execution, delivery, and performance
of
derivatives transactions
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Upon
execution of this Agreement
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Yes
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Party
A
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Correct,
complete and executed U.S. Internal Revenue Form W-9 or any successor
thereto
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Upon
execution of this Agreement, upon the appointment of a successor
Subordination Agent, and at any time upon reasonable request by
Party
B
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Not
applicable
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|||
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Party
B
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Correct,
complete and executed U.S. Internal Revenue Form W-9 or any successor
thereto
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Upon
execution of this Agreement, upon the appointment of a successor
Subordination Agent, and at any time upon reasonable request by
Party
A
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Not
applicable
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|||
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Party
A
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Credit
Support Document specified in Part 4(e)
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Upon
execution of this Agreement
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Yes
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Part
4
Miscellaneous
| (a) |
Addresses
for Notices.
For the purpose of Section 12(a):
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(i)
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Address
for notices or communications to Party A (including all notices pursuant
to
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4
Sections
5, 6 and 7 as well as any changes to Party B’s address, telephone number or
facsimile number):
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Address:
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▇▇▇▇▇▇
▇▇▇▇▇▇▇ Capital Services Inc.
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Transaction
Management Group
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▇▇▇▇
▇▇▇▇▇▇▇▇
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▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
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Attention:
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Chief
Legal Officer
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Facsimile:
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▇▇▇-▇▇▇-▇▇▇▇
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| (ii) |
Address
for notices or communications to Party
B:
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Address:
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Wilmington
Trust Company
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▇▇▇▇▇▇
Square North
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▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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Attention:
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Corporate
Trust Administration
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Telephone:
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▇▇▇-▇▇▇-▇▇▇▇
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Facsimile:
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▇▇▇-▇▇▇-▇▇▇▇
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| (b) |
Offices.
The
provisions of Section 10(a) will apply to this
Agreement.
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| (c) |
Multibranch
Party. For
the purpose of Section 10(c):
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Party
A
is not a Multibranch Party.
Party
B
is not a Multibranch Party.
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(d)
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Calculation
Agent.
The Calculation Agent is Party A, provided that if Party B disagrees
with
respect to any calculation or determination, Party A and Party B
each will
appoint an independent Reference Market-maker, and such two Reference
Market-makers jointly will appoint a third Reference Market-maker.
Such
three Reference Market-makers jointly will make such calculation
or
determination (acting as experts and not as arbitrators), whose
calculation or determination will be binding and conclusive absent
manifest error. In addition, if an Event of Default with respect
to Party
A has occurred and is continuing, Party B may appoint one of the
following
five entities as Calculation Agent: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, UBS AG, Bank
of
America, N.A., Deutsche Bank AG or Citibank,
N.A.
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(e)
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Credit
Support Documents.
Party A shall deliver an unconditional and irrevocable guarantee
dated as
of June 9, 2006 from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ with respect to Party A’s obligations
under this Transaction for the benefit of Party B and such guarantee
shall
be a Credit Support Document with respect to Party
A.
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With
respect to Party B: None.
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(f)
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Credit
Support Provider.
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Credit
Support Provider means in relation to Party A: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇.
Credit
Support Provider means in relation to Party B: None.
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(g)
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Governing
Law.
This Agreement and the Confirmation will be governed by and construed
in
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5
accordance
with the laws of the State of New York.
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(h)
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Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word “non-”; and (ii) deleting the final
paragraph thereof.
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(i)
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Netting
of Payments. The
Netting provision set forth in Section 2(c) will not apply to any
Transaction.
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(j)
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Affiliate.
Affiliate
will have the meaning specified in Section 14, provided
that the definition of Affiliate in relation to Party A does not
include
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Derivative Products,
Inc.
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(k)
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Covered
Transaction.
The
Transaction evidenced by the Confirmation dated the date of this
Agreement
(Reference Number: SQB38) will constitute the only Transaction and
Confirmation supplementing, forming part of, and subject to, this
Agreement.
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Part
5
Other
Provisions
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(a)
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Definitions.
This Agreement and the Transaction between the parties are subject
to the
2000 ISDA Definitions and Annex to the 2000 ISDA Definitions (June
2000
Version) as published by the International Swaps and Derivatives
Association, Inc. (collectively, the “Definitions”), and will be governed
in all relevant respects by the provisions set forth in the Definitions,
without regard to any amendment to the Definitions subsequent to
the date
hereof. The provisions of the Definitions are incorporated by reference
in
and shall be deemed a part of this Agreement, except that references
in
the Definitions to a “Swap Transaction” shall be deemed references to a
“Transaction” for purposes of this Agreement. In the event of any
inconsistency between the provisions of this Agreement and the
Definitions, this Agreement will prevail. “Intercreditor Agreement” as
used in this Agreement shall mean the Intercreditor Agreement dated
as of
June 9, 2006 among Wilmington Trust Company, as Trustee under the
Continental Airlines Pass Through Trust 2006-1G and Continental Airlines
Pass Through Trust 2006-1B, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Bank, as Primary Liquidity
Provider, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services Inc., as Above-Cap Liquidity
Provider, Financial Guaranty Insurance Company, as Policy Provider,
and
Wilmington Trust Company, as Subordination Agent, attached hereto
as
Exhibit A. Capitalized terms used and not defined herein, in the
Confirmation, or in the Definitions shall have the meanings set forth
in
the Intercreditor Agreement, as amended or modified from time to
time in
accordance with the terms thereof.
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(b)
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Relationship
Between Parties. Each
party will be deemed to represent to the other party on the date
on which
it enters into the Transaction that (absent a written agreement between
the parties that expressly imposes affirmative obligations to the
contrary
for that Transaction):
|
(i) Non-Reliance.
It
is
acting for its own account, and it has made its own independent decisions
to
enter into the Transaction and as to whether the Transaction is appropriate
or
proper for it based upon its own judgment and upon advice from such advisers
as
it has deemed necessary. It is not relying on any communication (written
or oral) of the other party as investment advice or as a recommendation to
enter
into the Transaction; it being understood that information and explanations
related to the terms and conditions of the Transaction shall not be considered
investment advice or a recommendation to enter into the Transaction. No
communication (written or oral) received from the other party shall be deemed
to
be an assurance or guarantee as to the expected results of the
Transaction.
6
(ii) Assessment
and Understanding. It is capable of assessing the merits of and
understanding (on its own behalf or through independent professional advice),
and understands and accepts, the terms, conditions and risks of the
Transaction. It is also capable of assuming, and assumes, the risks of the
Transaction.
(iii) Status
of
Parties. The other party is not acting as a fiduciary for or an adviser to
it in respect of the Transaction.
|
(c)
|
WAIVER
OF JURY TRIAL.
EACH PARTY HEREBY WAIVES ITS RESPECTIVE RIGHT TO JURY TRIAL WITH
RESPECT
TO ANY LITIGATION ARISING UNDER, OR IN CONNECTION WITH, THIS AGREEMENT
OR
THE TRANSACTION.
|
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(d)
|
Non-petition.
Party A agrees that it will not, prior to the date that is one year
and
one day following the final payment of the Certificates, acquiesce,
petition or otherwise invoke or cause, or join in invoking or causing,
Party B or any other person or entity to invoke the process of any
governmental authority for the purpose of commencing or sustaining
a case
(whether voluntary or involuntary) against Party B under any bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of Party B
or any substantial part of its property or ordering the winding-up
or
liquidation of the affairs of Party B, provided,
however,
that nothing herein shall restrict or prohibit Party A from joining
in any
existing bankruptcy, reorganization, arrangement, insolvency, moratorium
or liquidation proceedings or other analogous proceedings under applicable
laws.
|
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(e)
|
Waiver
of Right of Set-off.
Notwithstanding any provision of this Agreement, the Confirmation
or any
other existing or future agreement between the parties hereto, each
party
irrevocably waives any and all rights it may have to set-off, net,
recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between the two parties hereunder against any obligations
between the two parties, whether arising under any agreement, applicable
law or otherwise.
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| (f) |
Amendments.
This Agreement is hereby further amended as
follows:
|
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(1)
|
Section
2(b) is hereby amended by the insertion of the following at the end
thereof after the word “change”: “provided that if such new account shall
not be in the same jurisdiction having the same power to tax as the
original account, the party not changing its account shall not be
obliged
to pay any greater amounts and shall not receive less as a result
of such
change than would have been the case if such change had not taken
place”.
|
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(2)
|
Section
2(d) is amended by adding thereto a new final sentence reading as
follows:
“Anything in this Section 2(d) to the contrary notwithstanding, Party
B
shall not be obligated to make any payment under this Section 2(d)
to
Party A.”
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(3)
|
Section
7 is amended by adding a new penultimate sentence to Section 7 as
follows:
“Any purported transfer under this Section 7 shall require Ratings
Confirmation, including, for the avoidance of doubt, any transfer
pursuant
to Section 6(b)(ii)”.
|
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(4)
|
Section
9(b) is amended by adding thereto a new sentence reading as follows:
“In
addition, no amendment, modification or waiver in respect of this
Agreement will be effective unless Ratings Confirmation is
received”.
|
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(g)
|
Limitation
of Liability.
The obligations of Party B under this Agreement, and in respect of
the
|
7
Transaction
evidenced by the Confirmation, are expressly limited to the extent of funds,
if
any, made available for such payment to Party B under, and in accordance with,
the priorities of payments set forth in Sections 3.2 and 3.5 of the
Intercreditor Agreement. No recourse under any obligation, covenant or agreement
of Party B contained in this Agreement or the Confirmation shall be had against
any incorporator, stockholder, agent, affiliate, officer, employee or trustee
of
Party B, as such, by the enforcement of any assessment or by any legal or
equitable proceeding, by virtue of any statute or otherwise; it being expressly
agreed and understood that the agreements of Party B contained in this Agreement
or the Confirmation are solely trust obligations of Party B and that no personal
liability whatsoever shall attach to or be incurred by the incorporators,
stockholders, agents, affiliates, officers, employees or trustees of Party
B, as
such, or any of them, under or by reason of any of the obligations, covenants
or
agreements of Party B contained in this Agreement or the Confirmation and that
any and all personal liability of every such incorporator, stockholder, agent,
affiliate, officer, employee or trustee of Party B for breaches by Party B
of
any such obligation, covenant or agreement, which liability may arise either
at
common law or at equity, by statute or constitution, or otherwise, is hereby
expressly waived as a condition of and in consideration for the execution of
this Agreement; provided,
however,
that
nothing in this paragraph shall relieve any of the foregoing persons from any
liability which any such person may otherwise have for his/her or its gross
negligence or willful misconduct or,
with
respect to the handling or transfer of funds, ordinary negligence.
| (h) |
Eligible
Contract Participant.
Each party represents to the other that it
is an “eligible contract participant” as defined in Section 1a(12) of the
Commodity Exchange Act of 1922 (7 U.S. Code §1 et
seq.),
as amended (“CEA”). This Agreement and the Transaction hereunder are
subject to individual negotiation by the parties. Neither this
Agreement
nor the Transaction hereunder has been executed or traded on a
“trading
facility” as defined in Section 1a(33) of the
CEA.
|
| (i) |
Accuracy
of Specified Information. Section
3(d) is hereby amended by adding in the third line thereof after
the word
“respect” and before the period the words “or, in the case of audited or
unaudited financial statements or balance sheets, a fair representation
of
the financial condition of the relevant
person”.
|
[Signatures
follow on separate pages]
8
IN
WITNESS WHEREOF the parties have executed this Schedule to the ISDA Master
Agreement on the respective dates specified below with effect from the date
specified on the first page of this document.
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇ CAPITAL SERVICES INC.
|
|||
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By:
|
|||
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Name:
|
|||
|
Title:
|
|||
|
WILMINGTON
TRUST COMPANY
in
its capacity as Subordination Agent on behalf of the Trustee
under the
Continental Airlines Pass Through Trust
2006-1G.
|
|||
|
By:
|
|||
|
Name:
|
|||
|
Title:
|
|||
Exhibit
A
Intercreditor
Agreement