1
EXHIBIT 4.23
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Doc. No. 1.04
Aircraft N398UA
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TRUST AGREEMENT
(1994 737 B)
Dated as of September 1, 1994
between
MS FINANCING INC.,
Owner Participant
and
FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION,
Owner Trustee
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United Air Lines, Inc.
1994 737 B Equipment Trust
One Boeing 737-322 Aircraft
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND TERMS . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.01. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
AUTHORITY TO EXECUTE CERTAIN OPERATIVE DOCUMENTS;
DECLARATION OF TRUST . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2.01. Authority to Execute Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2.02. Declaration of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE III
PURCHASE OF AIRCRAFT;
ISSUANCE OF CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 3.01. Purchase of Aircraft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 3.02. Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE IV
RECEIPT, DISTRIBUTION AND APPLICATION
OF INCOME FROM THE TRUST ESTATE . . . . . . . . . . . . . . . . . . . . 5
SECTION 4.01. Distribution of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 4.02. Method of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE V
DUTIES OF THE OWNER TRUSTEE . . . . . . . . . . . . . . . . . . . . . 7
SECTION 5.01. Notice of Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
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SECTION 5.02. Action Upon Instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.03. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 5.04. No Duties Except as Specified in Trust Agreement or Instructions . . . . . . . . . . . . . . . . . . . 9
SECTION 5.05. Satisfaction of Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 5.06. No Action Except Under Specified Documents or Instruction . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE VI
THE OWNER TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 6.01. Acceptance of Trusts and Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 6.02. Absence of Certain Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 6.03. No Representations or Warranties as to Certain Matters . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 6.04. No Segregation of Monies Required; No Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 6.05. Reliance Upon Certificates, Counsel and Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 6.06. Not Acting in Individual Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 6.07. Fees; Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 6.08. Tax Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE VII
INDEMNIFICATION OF OWNER TRUSTEE BY OWNER PARTICIPANTS . . . . . . . . . . . . . . 14
SECTION 7.01. Owner Participants to Indemnify Owner Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
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ARTICLE VIII
TRANSFER OF AN OWNER PARTICIPANT'S INTEREST . . . . . . . . . . . . . . . . . 17
SECTION 8.01. Transfer of Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE IX
SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES . . . . . . . . . . . . . . . . . . 17
SECTION 9.01. Resignation of Owner Trustee; Appointment of Successor . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 9.02. Co-Trustees and Separate Trustees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE X
SUPPLEMENTS AND AMENDMENTS
TO TRUST AGREEMENT AND OTHER DOCUMENTS . . . . . . . . . . . . . . . . . . 21
SECTION 10.01. Supplements and Amendments and Delivery Thereof . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 10.02. Discretion as to Execution of Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 10.03. Absence of Requirements as to Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 10.04. Distribution of Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 10.05. No Request Needed as to Lease Supplement and Trust Supplement . . . . . . . . . . . . . . . . . . . . 22
ARTICLE XI
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 11.01. Termination of Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 11.02. Owner Participants Have No Legal Title in Trust Estate . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 11.03. Assignment, Sale, etc. of Aircraft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 11.04. Trust Agreement for Benefit of Certain Parties Only . . . . . . . . . . . . . . . . . . . . . . . . . 23
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SECTION 11.05. Citizenship of the Owner Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 11.06. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 11.07. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 11.08. Waivers, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 11.09. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 11.10. Binding Effect, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 11.11. Headings; References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 11.12. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 11.13. Performance by the Owner Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
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TRUST AGREEMENT
This TRUST AGREEMENT (1994 737 B) dated as of September 1,
1994 between MS FINANCING INC., a Delaware corporation (the "Original Owner
Participant"), and FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION, a
national banking association (in its individual capacity, "First Security Bank
of Utah", and otherwise not in its individual capacity but solely as trustee
hereunder with its permitted successors and assigns called the "Owner
Trustee").
W I T N E S S E T H:
ARTICLE I
DEFINITIONS AND TERMS
SECTION 1.01. Certain Definitions. Unless the context shall
otherwise require and except as contained in this Section 1.01, the capitalized
terms used herein shall have the respective meanings assigned thereto in the
Lease (as hereinafter defined) for all purposes hereof. All definitions
contained in this Section 1.01 shall be equally applicable to both the singular
and plural forms of the terms defined. For all purposes of this Trust
Agreement the following terms shall have the following meanings:
"Excluded Payments" has the meaning ascribed to such term in
the Trust Indenture.
"Indenture Event of Default" has the meaning which the term
"Event of Default" has in the Trust Indenture.
"Lease" means that certain Lease Agreement, to be dated as
of the date hereof, and to be entered into by the Owner Trustee and
Lessee concurrently with the execution and delivery of this Trust
Agreement as said Lease Agreement may from time to time be
supplemented or amended, or the terms thereof waived or modified, to
the extent permitted by, and in accordance with, the terms of this
Trust Agreement. The term "Lease" shall also include each Lease
Supplement from time to time entered into pursuant to the terms of
the Lease.
"Lease Event of Default" has the meaning which the term
"Event of Default" has in the Lease.
"Majority in Interest of Owner Participants" at any time
means, subject to Section 11.05, the Owner Participant
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[Trust Agreement (1994 737 B)]
or Owner Participants which then hold more than 50% of the Ownership
Interests of all Owner Participants.
"Owner Participants" shall mean the Original Owner
Participant and each Subsequent Owner Participant, to the extent that
the same shall, at the relevant time, have an Ownership Interest.
"Ownership Interest" means, in the case of each Owner
Participant, the percentage of its undivided beneficial interest in
the Trust Estate created by this Trust Agreement, which percentage
shall be: (i) in the case of the Original Owner Participant (A) so
long as it shall be the sole Owner Participant, 100% and (B) if it
shall no longer be the sole Owner Participant, the percentage of such
undivided interest in the Trust Estate which it shall not have
transferred to any Subsequent Owner Participant; and (ii) in the case
of any Subsequent Owner Participant, the percentage of such undivided
interest in the Trust Estate specified in the agreement pursuant to
which such Subsequent Owner Participant becomes an Owner Participant
as provided in the definition of "Subsequent Owner Participant" which
it shall not have transferred to any Subsequent Owner Participant.
"Subsequent Owner Participant" means any corporation to
which the Original Owner Participant or any transferee from the
Original Owner Participant or any Subsequent Owner Participant shall
have transferred at any time after the Delivery Date all or any part
of the undivided right, title and interest originally held by the
Original Owner Participant in the Trust Estate, provided that any
such transfer: (i) shall be effected by a written agreement, in form
and substance reasonably satisfactory to the Owner Trustee in its
individual capacity, between such transferee and its transferor,
which shall (A) specify the percentage of the Ownership Interest of
such transferee so transferred to it and (B) provide that such
transferee thereby becomes a party to, and beneficiary of, this Trust
Agreement and an Owner Participant for all purposes hereof and that
such transferee assumes all of the obligations of its transferor
under this Trust Agreement to the extent of such transferee's
Ownership Interest; and (ii) so long as the Lease shall be in effect
or the Certificates remain unpaid, such transferee and its transferor
shall have complied with all of the terms of Section 8(l) of the
Participation Agreement.
"Trust Estate" means all estate, right, title and interest
of the Owner Trustee in and to the Aircraft, the Lease, any Lease
Supplement, the Purchase Agreement, the Owner Trustee's Purchase
Agreement, the Owner Trustee's ▇▇▇▇ of Sale, and the Owner Trustee's
FAA ▇▇▇▇ of Sale, including, without limitation, all amounts of Basic
Rent and Supplemental Rent including without limitation insurance
proceeds (other than
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[Trust Agreement (1994 737 B)]
insurance proceeds payable to or for the benefit of the Owner
Trustee, First Security Bank of Utah in its individual capacity, the
Owner Participant, the Holders, or the Indenture Trustee) and
requisition, indemnity or other payments of any kind for or with
respect to the Aircraft (except amounts owing to the Owner
Participants, to the Indenture Trustee, to First Security Bank of
Utah, in its individual capacity, or to a Holder, or to any of their
respective Affiliates, directors, officers, employees, servants and
agents, pursuant to Section 7 of the Participation Agreement).
Notwithstanding the foregoing, "Trust Estate" shall not include any
Excluded Payment.
"Trust Office" has the meaning ascribed to such term in the
Lease.
"Trust Supplement" means a supplement to the Trust Agreement
and Trust Indenture in substantially the form of Exhibit A to the
Trust Indenture.
ARTICLE II
AUTHORITY TO EXECUTE CERTAIN OPERATIVE DOCUMENTS;
DECLARATION OF TRUST
SECTION 2.01. Authority to Execute Documents. The Original
Owner Participant hereby authorizes and directs the Owner Trustee to, and the
Owner Trustee agrees for the benefit of the Owner Participants that it will,
execute and deliver the Operative Documents and any other agreements,
instruments or documents to which the Owner Trustee is a party in the
respective forms thereof which are delivered from time to time by the Original
Owner Participant to the Owner Trustee for execution and delivery and, subject
to the terms hereof, to exercise its rights (upon instructions received from
the Owner Participants) and perform its duties under said Operative Documents
in accordance with the terms thereof.
SECTION 2.02. Declaration of Trust. The Owner Trustee
hereby declares that it will hold the Trust Estate upon the trusts hereinafter
set forth for the use and benefit of the Owner Participants, subject, however,
to the provisions of and the Lien created by the Trust Indenture and to the
provisions of the Lease and the Participation Agreement.
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[Trust Agreement (1994 737 B)]
ARTICLE III
PURCHASE OF AIRCRAFT;
ISSUANCE OF CERTIFICATES
SECTION 3.01. Purchase of Aircraft. The Original Owner
Participant hereby authorizes and directs the Owner Trustee to, and the Owner
Trustee agrees for the benefit of the Owner Participants that it will, on the
Delivery Date, subject to due compliance with the terms of Section 3.02 hereof:
(a) purchase the Aircraft pursuant to the Owner Trustee's
Purchase Agreement;
(b) accept from Lessee the delivery of the Owner Trustee's
▇▇▇▇ of Sale and the Owner Trustee's FAA ▇▇▇▇ of Sale;
(c) execute and deliver a Lease Supplement covering the
Aircraft;
(d) execute and deliver a Trust Supplement covering the
Aircraft;
(e) execute, issue and deliver to the Original Loan
Participant Certificates in the amounts and otherwise as provided in
Section 1 of the Participation Agreement;
(f) execute and deliver the financing statements referred
to in Section 4(a)(vi) of the Participation Agreement, together with
all other agreements, documents and instruments referred to in
Section 4 of the Participation Agreement to which the Owner Trustee
is to be a party;
(g) effect the registration of the Aircraft in the name of
the Owner Trustee by filing or causing to be filed with the FAA: (i)
the Owner Trustee's FAA ▇▇▇▇ of Sale; (ii) an application for
registration of the Aircraft in the name of the Owner Trustee
(including without limitation an affidavit from the Owner Trustee in
compliance with the provisions of 14 C.F.R. Section 47.7(c)(2)(ii));
and (iii) this Trust Agreement; and
(h) execute and deliver all such other instruments,
documents or certificates and take all such other actions in
accordance with the directions of the Original Owner Participant, as
the Original Owner Participant may deem necessary or advisable in
connection with the transactions contemplated hereby, the taking of
any such action by the Owner Trustee in the presence of the Original
Owner Participant or its counsel to evidence, conclusively, the
direction of the Original Owner Participant.
SECTION 3.02. Conditions Precedent. The rights and
obligations of the Owner Trustee to take the actions required by Section 3.01
hereof with respect to the Aircraft shall be subject to the following
conditions precedent: (a) the Original Owner Participant shall have made the
full amount of its Commitment set forth in Schedule II to the Participation
Agreement available to the Owner Trustee, in immediately available funds, in
accordance with Sections 1
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[Trust Agreement (1994 737 B)]
and 2 of the Participation Agreement; and (b) the Original Owner Participant
shall have notified the Owner Trustee that the terms and conditions of Section
4 of the Participation Agreement, insofar as they relate to conditions
precedent to performance by the Original Owner Participant of its obligations
thereunder, shall have been either fulfilled to the satisfaction of or waived
by the Original Owner Participant. The Original Owner Participant shall, by
instructing the Owner Trustee to release the funds then held by the Owner
Trustee as provided in Section 2 of the Participation Agreement, be deemed to
have found satisfactory to it, or waived, all such conditions precedent.
ARTICLE IV
RECEIPT, DISTRIBUTION AND APPLICATION
OF INCOME FROM THE TRUST ESTATE
SECTION 4.01. Distribution of Payments. (a) Payments to
Indenture Trustee. Until the Trust Indenture shall have been discharged
pursuant to Section 10.01 thereof, all Basic Rent, insurance proceeds and
requisition or other payments of any kind included in the Trust Estate (other
than Excluded Payments) payable to the Owner Trustee (other than payments
received from the Indenture Trustee) shall be payable directly to the Indenture
Trustee (and any of the same which are received by the Owner Trustee shall upon
receipt be paid over to the Indenture Trustee without deduction, set-off or
adjustment of any kind) for distribution in accordance with the provisions of
Article III of the Trust Indenture; provided, however, that any payments
received by the Owner Trustee from (i) the Lessee with respect to the Owner
Trustee's fees and disbursements, or (ii) the Owner Participant pursuant to
Article VII shall not be paid over to the Indenture Trustee but shall be
retained by the Owner Trustee and applied toward the purpose for which such
payments were made.
(b) Payments to Owner Trustee; Other Parties. After the
Trust Indenture shall have been discharged pursuant to Section 10.01 thereof,
any payment of the type referred to in Section 4.01(a) hereof (other than
Excluded Payments) received by the Owner Trustee, any payments received from
the Indenture Trustee other than as specified in Section 4.01(d) hereof and any
other amount received as part of the Trust Estate and for the application or
distribution of which no provision is made herein, shall be distributed
forthwith upon receipt by the Owner Trustee in the following order of priority:
first, so much of such payment as shall be required to reimburse the Owner
Trustee for any expenses not otherwise reimbursed as to which the Owner Trustee
is entitled to be so reimbursed pursuant to the provisions hereof shall be
retained by the Owner Trustee; second, so much of the remainder for which
provision as to the application thereof is contained in the Lease or any of the
other Operative Documents shall be applied and distributed in accordance with
the terms of the Lease or such other Operative Document; and
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[Trust Agreement (1994 737 B)]
third, the balance, if any, shall be paid ratably to each Owner Participant in
proportion to such Owner Participant's Ownership Interest.
(c) Certain Distributions to Owner Participant. All
amounts from time to time distributable by the Indenture Trustee to the Owner
Participants pursuant to the Trust Indenture shall, if paid to the Owner
Trustee, be distributed by the Owner Trustee to each Owner Participant in
proportion to such Owner Participant's Ownership Interest and in accordance
with the provisions of Article III of the Trust Indenture; provided, however,
that any payments received by the Owner Trustee from (i) the Lessee with
respect to the Owner Trustee's fees and disbursements, or (ii) the Owner
Participant pursuant to Article VII shall not be paid over to the Indenture
Trustee but shall be retained by the Owner Trustee and applied toward the
purpose for which such payments were made.
(d) Excluded Payments. Any Excluded Payments received by
the Owner Trustee shall be paid by the Owner Trustee to the Person to whom such
Excluded Payments are payable under the provisions of the Participation
Agreement, the Tax Indemnity Agreement (as directed by the Owner Participant)
or the Lease.
SECTION 4.02. Method of Payments. The Owner Trustee shall
make distributions or cause distributions to be made to each Owner Participant
pursuant to this Article IV by transferring by wire transfer in immediately
available funds on the day received (or on the next succeeding Business Day if
the funds to be distributed shall not have been received by the Owner Trustee
by 12:00 noon, New York time), the amount to be distributed to such account or
accounts of such Owner Participant as such Owner Participant may designate from
time to time in writing to the Owner Trustee. Notwithstanding the foregoing,
the Owner Trustee will, if so requested by such Owner Participant in writing,
pay any or all amounts payable to such Owner Participant pursuant to this
Article IV either (i) by crediting such amount or amounts to an account or
accounts maintained by such Owner Participant with First Security Bank of Utah
in its individual capacity in immediately available funds, (ii) by payment at
the Trust Office of the Owner Trustee, in immediately available funds, or (iii)
by mailing an official bank check or checks in such amount or amounts payable
to such Owner Participant at such address as such Owner Participant shall have
designated in writing to the Owner Trustee.
ARTICLE V
DUTIES OF THE OWNER TRUSTEE
SECTION 5.01. Notice of Event of Default. If the Owner
Trustee shall have knowledge of a Lease Event of Default or Indenture Event of
Default (or an event which with the
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[Trust Agreement (1994 737 B)]
passage of time or the giving of notice or both would constitute a Lease Event
of Default or an Indenture Event of Default), First Security Bank of Utah will
cause the Owner Trustee to give to the Indenture Trustee, the Owner Participant
and Lessee prompt telephonic or telex notice thereof followed by prompt
confirmation thereof by certified mail, postage prepaid. The notice shall set
forth in reasonable detail the facts or circumstances known to it with respect
to such Lease Event of Default or Indenture Event of Default. Subject to the
terms of Section 5.03 hereof, the Owner Trustee shall take such action or shall
refrain from taking such action, not inconsistent with the provisions of the
Trust Indenture, with respect to such Lease Event of Default, Indenture Event
of Default or other event as the Owner Trustee shall be directed in writing by
a Majority in Interest of Owner Participants. For all purposes of this Trust
Agreement, the Lease and the other Operative Documents, in the absence of
actual knowledge by a responsible officer of the Trust Office of the Owner
Trustee in his or her capacity as such, the Owner Trustee shall not be deemed
to have knowledge of a Lease Event of Default, Indenture Event of Default or
other event referred to in this Section 5.01 unless notified in writing by the
Indenture Trustee, one or more of the Owner Participants or the Lessee.
SECTION 5.02. Action Upon Instructions. Subject to the
terms of Sections 5.01 and 5.03 hereof, upon the written instructions at any
time and from time to time of a Majority in Interest of Owner Participants, the
Owner Trustee will take such of the following actions, not inconsistent with
the provisions of the Trust Indenture, as may be specified in such
instructions: (i) give such notice or direction or exercise such right, remedy
or power hereunder or under any of the Operative Documents to which the Owner
Trustee is a party or in respect of all or any part of the Trust Estate, or
take such other action, as shall be specified in such instructions (including
entering into agreements referred to in clause (i) of the definition of
"Subsequent Owner Participant"); (ii) take such action to preserve or protect
the Trust Estate (including the discharge of Liens) as may be specified in such
instructions; (iii) approve as satisfactory to it all matters required by the
terms of the Lease or the other Operative Documents to be satisfactory to the
Owner Trustee, it being understood that without written instructions of a
Majority in Interest of Owner Participants, the Owner Trustee shall not approve
any such matter as satisfactory to it; and (iv) subject to the rights of the
Lessee under the Operative Documents, after the expiration or earlier
termination of the Lease, convey all of the Owner Trustee's right, title and
interest in and to the Aircraft for such amount, on such terms and to such
purchaser or purchasers as shall be designated in such instructions, or retain,
lease or otherwise dispose of, or from time to time take such other action with
respect to, the Aircraft on such terms as shall be designated in such
instructions.
SECTION 5.03. Indemnification. The Owner Trustee shall not
be required to take any action under Section 5.01 (other than the giving of the
notices referred to therein) or 5.02 hereof unless the Owner Trustee shall have
been indemnified by the Owner Participants, in manner and form satisfactory to
the Owner Trustee, against any liability, cost or expense
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[Trust Agreement (1994 737 B)]
(including reasonable counsel fees and disbursements) which may be incurred in
connection therewith; and, if a Majority in Interest of Owner Participants
shall have directed the Owner Trustee to take any such action or refrain from
taking any action, each Owner Participant agrees to furnish such indemnity as
shall be required (severally and ratably according to their respective
Ownership Interests) and, in addition to the extent not otherwise paid pursuant
to the provisions of the Lease or of the Participation Agreement, to pay
(severally and ratably according to their respective Ownership Interests) the
reasonable compensation of the Owner Trustee for the services performed or to
be performed by it pursuant to such direction and any reasonable fees and
disbursements of counsel or agents employed by the Owner Trustee in connection
therewith. The Owner Trustee shall not be required to take any action under
Section 5.01 or 5.02 hereof if the Owner Trustee shall reasonably determine, or
shall have been advised by counsel, that such action is contrary to the terms
of any of the Operative Documents to which the Owner Trustee is a party, or is
otherwise contrary to law.
SECTION 5.04. No Duties Except as Specified in Trust
Agreement or Instructions. The Owner Trustee shall not have any duty or
obligation to manage, control, use, sell, dispose of or otherwise deal with the
Aircraft or any other part of the Trust Estate, or to otherwise take or refrain
from taking any action under, or in connection with any of the Operative
Documents to which the Owner Trustee is a party, except as expressly required
by the terms of any of the Operative Documents to which the Owner Trustee is a
party, or (to the extent not inconsistent with the provisions of the Trust
Indenture) as expressly provided by the terms hereof or in a written
instruction from a Majority in Interest of Owner Participants received pursuant
to the terms of Section 5.01 or 5.02 and no implied duties or obligations shall
be read into this Trust Agreement against the Owner Trustee. First Security
Bank of Utah agrees that it will, in its individual capacity and at its own
cost or expense (but without any right of indemnity in respect of any such cost
or expense under Section 7.01 hereof), promptly take such action as may be
necessary to duly discharge and satisfy in full all Lessor Liens attributable
to it in its individual capacity which it is required to discharge pursuant to
Section 8(g) of the Participation Agreement and otherwise comply with the terms
of said Section binding upon it.
SECTION 5.05. Satisfaction of Conditions Precedent.
Anything herein to the contrary notwithstanding, the Owner Trustee shall comply
with the provisions of Section 3.01 hereof upon the satisfaction of all the
applicable conditions precedent specified in Section 3.02 hereof and in Section
4 of the Participation Agreement.
SECTION 5.06. No Action Except Under Specified Documents or
Instruction. The Owner Trustee agrees that it will not manage, control, use,
sell, dispose of or otherwise deal with the Aircraft or any other part of the
Trust Estate except (i) as expressly required by the terms of any of the
Operative Documents to which the Owner Trustee is a party, (ii) as expressly
provided by the terms hereof, or (iii) as expressly
8
14
[Trust Agreement (1994 737 B)]
provided in written instructions from a Majority in Interest of Owner
Participants pursuant to Section 5.01 or 5.02 hereof.
ARTICLE VI
THE OWNER TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties. First
Security Bank of Utah accepts the trusts hereby created and agrees to perform
the same but only upon the terms hereof applicable to it. The Owner Trustee
also agrees to receive and disburse all monies received by it constituting part
of the Trust Estate upon the terms hereof. First Security Bank of Utah shall
not be answerable or accountable under any circumstances, except (a) for its
own willful misconduct or gross negligence, (b) for performance of the terms of
the last sentence of Section 5.04 hereof and the first sentence of Section 5.01
hereof, (c) for its or the Owner Trustee's failure to use ordinary care to
disburse funds, (d) for any Tax based on or measured by any fees, commissions
or compensation received by it for acting as trustee in connection with any of
the transactions contemplated by the Operative Documents and (e) for
liabilities that may result from the inaccuracy of any representation or
warranty of it (or from the failure by it to perform any covenant) in Section
6.03 hereof, in Section 4 of the Lease or in Sections 8(b), 8(c) and 8(p) of
the Participation Agreement.
SECTION 6.02. Absence of Certain Duties. Except in
accordance with written instructions furnished pursuant to Section 5.02 hereof
and except as provided in, and without limiting the generality of, Sections
3.01 and 5.04 hereof and the last sentence of Section 9.01(b) hereof, neither
the Owner Trustee nor First Security Bank of Utah shall have any duty (i) to
see to any recording or filing of any Operative Document or of any supplement
to any thereof or to see to the maintenance of any such recording or filing or
any other filing of reports with the Federal Aviation Administration or other
governmental agencies, except that First Security Bank of Utah in its
individual capacity agrees to comply with the Federal Aviation Administration
reporting requirements set forth in 14 CFR Section 47.45 and 14 CFR Section
47.51, and the Owner Trustee shall, to the extent that information for that
purpose is timely supplied by Lessee pursuant to any of the Operative
Documents, complete and timely submit (and furnish each Owner Participant with
a copy of) any and all reports relating to the Aircraft which may from time to
time be required by the Federal Aviation Administration or any government or
governmental authority having jurisdiction, (ii) to see to any insurance on the
Aircraft or to effect or maintain any such insurance, whether or not Lessee
shall be in default with respect thereto, other than to forward to the Owner
Participant copies of all reports and other written information which the Owner
Trustee receives from Lessee pursuant to Section 11(c) of the Lease, (iii) to
see to the payment or discharge of any tax, assessment or other governmental
charge or any lien or encumbrance of
9
15
[Trust Agreement (1994 737 B)]
any kind owing with respect to, assessed or levied against any part of the
Indenture Estate or the Trust Estate, except as provided in Section 8(g) of the
Participation Agreement, or (iv) to inspect Lessee's books and records with
respect to the Aircraft at any time permitted pursuant to the Lease.
Notwithstanding the foregoing, the Owner Trustee will furnish to the Indenture
Trustee and each of the Owner Participants, promptly upon receipt thereof,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and other instruments furnished to the Owner Trustee under
the Lease or any other Operative Document to which a responsible officer of the
Owner Trustee reasonably believes have not been delivered to said parties.
SECTION 6.03. No Representations or Warranties as to
Certain Matters. NEITHER THE OWNER TRUSTEE NOR FIRST SECURITY BANK OF UTAH
MAKES OR SHALL BE DEEMED TO HAVE MADE (a) ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, AS TO THE TITLE, VALUE, CONDITION, DESIGN, OPERATION,
MERCHANTABILITY OR FITNESS FOR USE OF THE AIRCRAFT OR ANY PART THEREOF, OR ANY
OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE AIRCRAFT WHATSOEVER,
except that First Security Bank of Utah in its individual capacity warrants
that on the Delivery Date the Owner Trustee shall have received whatever title
was conveyed to it by Lessee and that the Aircraft shall during the Term of the
Lease be free of Lessor Liens attributable to First Security Bank of Utah in
its individual capacity, or (b) any representation or warranty as to the
validity, legality or enforceability of this Trust Agreement or any Operative
Document to which the Owner Trustee is a party, or any other document or
instrument, or as to the correctness of any statement contained in any thereof
except to the extent that any such statement is expressly made herein or
therein by such party as a representation by First Security Bank of Utah in its
individual capacity or by the Owner Trustee, as the case may be, and except
that First Security Bank of Utah in its individual capacity hereby represents
and warrants that this Trust Agreement has been, and (assuming due
authorization, execution and delivery by the Original Owner Participant of this
Trust Agreement) the Operative Documents to which it or the Owner Trustee is a
party have been (or at the time of execution and delivery of any such
instrument by it or the Owner Trustee hereunder or pursuant to the terms of the
Participation Agreement that such an instrument will be) duly executed and
delivered by one of its officers who is or will be, as the case may be, duly
authorized to execute and deliver such instruments on behalf of itself or the
Owner Trustee, as the case may be, and that (assuming the due authorization,
execution and delivery of the Trust Agreement by the Original Owner
Participant) the Trust Agreement constitutes the legal, valid and binding
obligation of First Security Bank of Utah or the Owner Trustee, as the case may
be, enforceable against First Security Bank of Utah or the Owner Trustee, as
the case may be, in accordance with its terms.
SECTION 6.04. No Segregation of Monies Required; No
Interest. Monies received by the Owner Trustee hereunder need not be
segregated in any manner except to the
10
16
[Trust Agreement (1994 737 B)]
extent required by law, and may be deposited under such general conditions as
may be prescribed by law, and the Owner Trustee shall not, except as provided
in Section 22 of the Lease, be liable for any interest thereon.
SECTION 6.05. Reliance Upon Certificates, Counsel and
Agents. The Owner Trustee shall incur no liability to anyone in acting in
reliance upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper reasonably
believed by it in good faith to be genuine and reasonably believed by it to be
signed by the proper party or parties. Unless other evidence in respect
thereof is specifically prescribed herein, any request, direction, order or
demand of the Owner Participants or Lessee mentioned herein or in any of the
Operative Documents to which the Owner Trustee is a party shall be sufficiently
evidenced by written instruments signed by a person purporting to be the
Chairman of the Board, the President or any Vice President and in the name of
any such Owner Participant or Lessee, as the case may be. The Owner Trustee
may accept a copy of a resolution of the Board of Directors or Executive
Committee of Lessee, certified by the Secretary or an Assistant Secretary of
Lessee as duly adopted and in full force and effect, as conclusive evidence
that such resolution has been duly adopted by said Board or Committee and that
the same is in full force and effect. As to any fact or matter the manner of
ascertainment of which is not specifically described herein, the Owner Trustee
may for all purposes hereof rely on a certificate signed by a person purporting
to be the Chairman of the Board, the President or any Vice President of Lessee,
as to such fact or matter, and such certificate shall constitute full
protection to the Owner Trustee for any action taken or omitted to be taken by
it in good faith in reliance thereon. In the administration of trusts
hereunder, the Owner Trustee may execute any of the trusts or powers hereof and
perform its powers and duties hereunder directly or through agents or attorneys
and may, at the expense of the Trust Estate, consult with counsel, accountants
and other skilled persons to be selected and employed by it. The Owner Trustee
shall not be liable for anything done, suffered or omitted in good faith by it
in accordance with the advice or opinion of any such counsel, accountants or
other skilled persons and the Owner Trustee shall not be liable for the
negligence of any such counsel, accountant or other skilled person appointed by
it with due care hereunder.
SECTION 6.06. Not Acting in Individual Capacity. In acting
hereunder, the Owner Trustee acts solely as trustee and not in its individual
capacity except as otherwise expressly provided herein; and, except as may be
otherwise expressly provided in this Trust Agreement, the Lease, the
Participation Agreement and the Trust Indenture, all persons having any claim
against the Owner Trustee by reason of the transactions contemplated hereby
shall look only to the Trust Estate for payment or satisfaction thereof.
SECTION 6.07. Fees; Compensation. The Owner Trustee shall
be entitled to receive compensation, reasonable as regards its responsibilities
hereunder, together with
11
17
[Trust Agreement (1994 737 B)]
reimbursement within three (3) months of its request for all reasonable
expenses incurred or made by it in accordance with any of the provisions of
this Trust Agreement or any other Operative Document (including the reasonable
compensation and the expenses of its counsel, accountants or other skilled
persons and of all other persons not regularly in its employ). If a Lease Event
of Default or Indenture Event of Default shall occur and be continuing or if
the Lease or the Trust Indenture is declared to be in default, the Owner
Trustee shall be entitled to receive compensation, reasonable as regards its
additional responsibilities hereunder, and payment or reimbursement for its
expenses as provided above. Pursuant to Section 7(c) of the Participation
Agreement and subject to Section 16 thereof, Lessee shall be required to pay
the reasonable fees and expenses of the Owner Trustee comprising the
compensation and reimbursement of expenses to which the Owner Trustee is
entitled under this Section 6.07. Except as otherwise expressly provided in
this Trust Agreement and the other Operative Documents, neither the Owner
Participants nor the Trust Estate shall have any liability for any such fees
and expenses; provided, however, the Owner Participants shall be liable for
such additional compensation of the Owner Trustee if the same is attributable
to an Indenture Event of Default not resulting from a Lease Event of Default
(the Owner Trustee having no right to additional compensation if the same is
attributable to an Indenture Event of Default caused solely by the Owner
Trustee in its individual capacity); and further provided that the Owner
Trustee shall have a Lien upon the Trust Estate for any such fee not paid by
Lessee as contemplated by Section 7 of the Participation Agreement and such
Lien shall entitle the Owner Trustee to priority as to payment thereof over
payment to any other Person under this Trust Agreement but shall at all times
be subordinated to the lien of the Trust Indenture.
SECTION 6.08. Tax Returns. The Owner Trustee shall be
responsible for the keeping of all appropriate books and records relating to
the receipt and disbursement of all monies under this Trust Agreement or any
agreement contemplated hereby. The Owner Participants shall be responsible for
causing to be prepared and filed all income tax returns required to be filed by
the Owner Participants. The Owner Trustee shall be responsible for causing to
be prepared, at the request of the Owner Participants, all income tax returns
required to be filed with respect to the trust created hereby and shall execute
and file such returns. Each Owner Participant, upon request, will furnish the
Owner Trustee and the Owner Trustee will furnish each Owner Participant with
all such information as may be reasonably required from any such party in
connection with the preparation of such income tax returns. The Owner Trustee
will give to any Owner Participant, upon request, such periodic information
concerning receipts and disbursements by it with respect to the Trust Estate as
would be helpful to such Owner Participant in preparing its tax returns.
12
18
[Trust Agreement (1994 737 B)]
ARTICLE VII
INDEMNIFICATION OF OWNER TRUSTEE BY OWNER PARTICIPANTS
SECTION 7.01. Owner Participants to Indemnify Owner
Trustee. The Owner Participants hereby severally agree, each in proportion to
its Ownership Interest, whether or not any of the transactions contemplated
hereby shall be consummated, to assume liability for, and hereby indemnify,
protect, save and keep harmless First Security Bank of Utah in its individual
capacity and its successors, assigns, legal representatives, agents and
servants, from and against any and all liabilities, obligations, losses,
damages, penalties, taxes (excluding any taxes payable by First Security Bank
of Utah in its individual capacity on or measured by any compensation received
by First Security Bank of Utah in its individual capacity for its services
hereunder), claims, actions, suits, costs, expenses or disbursements
(including, without limitation, reasonable legal fees and expenses, and
including without limitation any liability of an owner, any strict liability
and any liability without fault) of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against First Security Bank of Utah in its
individual capacity (whether or not also indemnified against by Lessee under
the Lease or under the Participation Agreement or also indemnified against by
any other person, but only to the extent not otherwise paid or reimbursed by
such other person) in any way relating to or arising out of this Trust
Agreement or any of the Operative Documents or the enforcement of any of the
terms of any thereof, or in any way relating to or arising out of the
manufacture, purchase, acceptance, nonacceptance, rejection, ownership,
delivery, lease, possession, use, operation, condition, sale, return or other
disposition of the Aircraft (including, without limitation, latent and other
defects, whether or not discoverable, and any claim for patent, trademark or
copyright infringement), or in any way relating to or arising out of the
administration of the Trust Estate or the action or inaction of the Owner
Trustee or First Security Bank of Utah in its individual capacity hereunder,
except (a) in the case of willful misconduct or gross negligence on the part of
the Owner Trustee or First Security Bank of Utah in its individual capacity in
the performance or nonperformance of its duties hereunder or under any of the
other Operative Documents to which the Owner Trustee is a party, (b) those
resulting from the inaccuracy of any representation or warranty of First
Security Bank of Utah in its individual capacity (or from the failure of First
Security Bank of Utah in its individual capacity to perform any of its
covenants) in Section 6.03 hereof, in Section 4 of the Lease, in Sections 8(b),
8(c) or 8(p) of the Participation Agreement or elsewhere in any of the other
Operative Documents, (c) as may result from a breach by First Security Bank of
Utah in its individual capacity of its covenant in the last sentence of Section
5.04 hereof, (d) in the case of the failure to use ordinary care on the part of
the Owner Trustee or First Security Bank of Utah in its individual capacity in
the disbursement of funds or (e) those claims arising under any circumstances
or upon any terms where Lessee would not have been required to indemnify the
Owner Trustee in its individual capacity pursuant to Section 7(b) or 7(c) of
the Participation Agreement (disregarding, for this purpose,
13
19
[Trust Agreement (1994 737 B)]
Sections 7(b)(ii)(3) (to the extent that such disposition referred to therein
results from the Owner Trustee's acting in accordance with written instructions
of the Owner Participants), 7(b)(ii)(8), 7(c)(2) (to the extent that such
failure referred to therein results from the Owner Trustee's acting in
accordance with written instructions of the Owner Participants), 7(c)(4) (to
the extent that such disposition referred to therein results from the Owner
Trustee's acting in accordance with written instructions of the Owner
Participants), 7(c)(6), 7(c)(8) and 7(c)(10) of the Participation Agreement and
disregarding, for this purpose, those claims arising or resulting from any
action taken by or inaction of the Owner Trustee in accordance with written
instructions of the Owner Participants); provided, however, that the exception
set forth in clause (a) of this Section 7.01 shall not apply to any action
taken or omission made by the Owner Trustee pursuant to and in accordance with
written directions given to the Owner Trustee by the Owner Participants. The
indemnities contained in this Section 7.01 extend to First Security Bank of
Utah only in its individual capacity and shall not be construed as indemnities
of the Indenture Estate or the Trust Estate (except to the extent, if any, that
First Security Bank of Utah in its individual capacity has been reimbursed by
the Indenture Estate or the Trust Estate for amounts covered by the indemnities
contained in this Section 7.01). The indemnities contained in this Section
7.01 shall survive the termination of this Trust Agreement. In addition, if
necessary, First Security Bank of Utah in its individual capacity shall be
entitled to indemnification from the Trust Estate, subject to the Lien of the
Trust Indenture, for any liability, obligation, loss, damage, penalty, tax,
claim, action, suit, cost, expense or disbursement indemnified against pursuant
to this Section 7.01 to the extent not reimbursed by Lessee, the Owner
Participants or others, but without releasing any of them from their respective
agreements of reimbursement; and to secure the same First Security Bank of Utah
in its individual capacity shall have a lien on the Trust Estate, subject to
the lien of the Trust Indenture, which shall be prior to any interest therein
of the Owner Participants. The payor of any indemnity under this Article VII
shall be subrogated to any right of the person indemnified in respect of the
matter as to which such indemnity was paid.
ARTICLE VIII
TRANSFER OF AN OWNER PARTICIPANT'S INTEREST
SECTION 8.01. Transfer of Interests. All provisions of
Section 8(l) of the Participation Agreement shall (with the same force and
effect as if set forth in full in this Section 8.01) be applicable to any
assignment, conveyance or other transfer by any Owner Participant of any of its
right, title or interest in and to the Participation Agreement, the Trust
Estate or this Trust Agreement. If there is more than one Owner Participant,
no assignment, conveyance or other transfer by an Owner Participant of any of
its right, title or interest in and to this Trust Agreement or the Trust Estate
shall be valid unless each other Owner Participant's prior written consent is
given to such assignment, conveyance or other transfer.
14
20
[Trust Agreement (1994 737 B)]
ARTICLE IX
SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES
SECTION 9.01. Resignation of Owner Trustee; Appointment of
Successor. (a) Resignation or Removal. The Owner Trustee or any successor
Owner Trustee (i) shall resign if required to do so pursuant to Section 8(b) of
the Participation Agreement and (ii) may resign at any time without cause by
giving at least 60 days' prior written notice to each Owner Participant, the
Indenture Trustee and Lessee, such resignation to be effective upon the
acceptance of appointment by the successor Owner Trustee under Section 9.01(b)
hereof. In addition, a Majority in Interest of Owner Participants may at any
time remove the Owner Trustee without cause by a notice in writing delivered to
the Owner Trustee, all other Owner Participants, the Indenture Trustee and
Lessee, such removal to be effective upon the acceptance of appointment by the
successor Owner Trustee under Section 9.01(b) hereof. In the case of the
resignation or removal of the Owner Trustee, a Majority in Interest of Owner
Participants may appoint a successor Owner Trustee by an instrument signed by
such Owner Participants, such successor to be approved by Lessee (which
approval shall not be unreasonably withheld). If a successor Owner Trustee
shall not have been appointed within 30 days after such notice of resignation
or removal, the Owner Trustee, any Owner Participant, Lessee or the Indenture
Trustee may apply to any court of competent jurisdiction to appoint a successor
Owner Trustee to act until such time, if any, as a successor shall have been
appointed as above provided. Any successor Owner Trustee so appointed by such
court shall immediately and without further act be superseded by any successor
Owner Trustee appointed as above provided.
(b) Execution and Delivery of Documents, etc. Any
successor Owner Trustee, however appointed, shall execute and deliver to the
predecessor Owner Trustee an instrument accepting such appointment, and
thereupon such successor Owner Trustee, without further act, shall become
vested with all the estates, properties, rights, powers, duties and trusts of
the predecessor Owner Trustee in the trusts hereunder with like effect as if
originally named the Owner Trustee herein; but nevertheless, upon the written
request of such successor Owner Trustee, such predecessor Owner Trustee shall
execute and deliver an instrument transferring to such successor Owner Trustee,
upon the trusts herein expressed, all the estates, properties, rights, powers
and trusts of such predecessor Owner Trustee, and such predecessor Owner
Trustee shall duly assign, transfer, deliver and pay over to such successor
Owner Trustee all monies or other property then held by such predecessor Owner
Trustee upon the trusts herein expressed. Upon the appointment of any
successor Owner Trustee hereunder, the predecessor Owner Trustee will execute
such documents as are provided to it by such successor Owner Trustee and will
take such further actions as are requested of it by such successor Owner
Trustee as are reasonably required to cause registration of the Aircraft
included in the Trust Estate to be transferred upon
15
21
[Trust Agreement (1994 737 B)]
the records of the Federal Aviation Administration, or other governmental
authority having jurisdiction, into the name of the successor Owner Trustee.
(c) Qualifications. Any successor Owner Trustee, however
appointed, shall be a "citizen of the United States" within the meaning of
Section 40102(a)(15) of the Transportation Code and shall also be a bank or
trust company organized under the laws of the United States or any state
thereof having a combined capital and surplus of at least $50,000,000 (or the
obligations and liabilities of which, whether now in existence or hereafter
incurred, are fully and unconditionally guaranteed by an affiliate company
organized under the laws of the United States or any state thereof having a
combined capital and surplus of at least $50,000,000), if there be such an
institution willing, able and legally qualified to perform the duties of the
Owner Trustee hereunder upon reasonable or customary terms. No such successor
trustee shall (i) be located in a jurisdiction which creates adverse
consequences for the Lessee (unless such circumstances would be created by
substantially all jurisdictions where major banking or trust institutions are
located) or (ii) charge fees for its services as an Owner Trustee in excess of
the then prevailing market rates for such services (unless the Owner
Participants agree that they and not the Lessee shall be liable for such
excess).
(d) Merger, etc. Any corporation into which First Security
Bank of Utah may be merged or converted or with which it may be consolidated,
or any corporation resulting from any merger, conversion or consolidation to
which First Security Bank of Utah shall be a party, or any corporation to which
substantially all the corporate trust business of First Security Bank of Utah
may be transferred, shall, subject to the terms of Section 9.01(c) hereof, be
the Owner Trustee hereunder without further act.
SECTION 9.02. Co-Trustees and Separate Trustees. If at any
time it shall be necessary or prudent in order to conform to any law of any
jurisdiction in which all or any part of the Trust Estate is located, or make
any claim or bring any suit with respect to the Trust Estate or the Lease, or
in the event that the Owner Trustee shall have been requested to do so by the
Owner Participants or the Owner Trustee being advised by counsel shall
determine that it is so necessary or prudent in the interest of the Owner
Participants or the Owner Trustee, or the Owner Trustee shall have been
directed to do so by a Majority in Interest of Owner Participants, the Owner
Trustee and each Owner Participant shall execute and deliver an agreement
supplemental hereto and all other instruments and agreements necessary or
proper to constitute another bank or trust company or one or more persons (any
and all of which shall be a "citizen of the United States" as defined in
Section 40102(a)(15) of the Transportation Code) approved by the Owner Trustee
and a Majority in Interest of Owner Participants, either to act as co-trustee,
jointly with the Owner Trustee, or to act as separate trustee hereunder (any
such co-trustee or separate trustee being herein sometimes referred to as an
"additional trustee"). In the event the Owner Participants shall not have
joined in the execution of such agreements supplemental
16
22
[Trust Agreement (1994 737 B)]
hereto within ten days after the receipt of a written request from the Owner
Trustee so to do, or in case a Lease Event of Default or Indenture Event of
Default shall occur and be continuing, the Owner Trustee may act under the
foregoing provisions of this Section 9.02 without the concurrence of the Owner
Participants; and the Owner Participants hereby appoint the Owner Trustee their
agent and attorney-in-fact to act for them under the foregoing provisions of
this Section 9.02 in either of such contingencies.
Every additional trustee hereunder shall, to the extent
permitted by law, be appointed and act, and the Owner Trustee and its
successors shall act, subject to the following provisions and conditions:
(A) All powers, duties, obligations and rights conferred
upon the Owner Trustee in respect of the custody, control and
management of monies, the Aircraft or documents authorized to be
delivered hereunder or under the Participation Agreement shall be
exercised solely by the Owner Trustee;
(B) All other rights, powers, duties and obligations
conferred or imposed upon the Owner Trustee shall be conferred or
imposed upon and exercised or performed by the Owner Trustee and such
additional trustee jointly, except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be
performed (including the holding of title to the Trust Estate) the
Owner Trustee shall be incompetent or unqualified to perform such act
or acts, in which event such rights, powers, duties and obligations
shall be exercised and performed by such additional trustee;
(C) No power given to, or which it is provided hereby may be
exercised by, any such additional trustee shall be exercised
hereunder by such additional trustee, except jointly with, or with
the consent in writing of, the Owner Trustee;
(D) No trustee hereunder shall be personally liable by
reason of any action or omission of any other trustee hereunder;
(E) A Majority in Interest of Owner Participants, at any
time, by an instrument in writing may remove any such additional
trustee. In the event that the Owner Participants shall not have
joined in the execution of any such instrument within ten days after
the receipt of a written request from the Owner Trustee so to do, the
Owner Trustee shall have the power to remove any such additional
trustee without the concurrence of the Owner Participants; and the
Owner Participants hereby appoint the Owner Trustee their agent and
attorney-in-fact for them in such connection in such contingency; and
17
23
[Trust Agreement (1994 737 B)]
(F) No appointment of, or action by, any additional trustee
will relieve the Owner Trustee of any of its obligations under, or
otherwise affect any of the terms of, the Trust Indenture or affect
the interests of the Indenture Trustee or the Holders of the
Certificates in the Indenture Estate.
ARTICLE X
SUPPLEMENTS AND AMENDMENTS
TO TRUST AGREEMENT AND OTHER DOCUMENTS
SECTION 10.01. Supplements and Amendments and Delivery
Thereof. (a) Supplement and Amendments. This Trust Agreement may not be
amended, supplemented or otherwise modified except by an instrument in writing
signed by the Owner Trustee and a Majority in Interest of Owner Participants.
Subject to Section 10.02 hereof and Section 10(B) of the Participation
Agreement, the Owner Trustee will execute any amendment, supplement or other
modification of this Trust Agreement or of any other Operative Documents to
which the Owner Trustee is a party which it is requested to execute by a
Majority in Interest of Owner Participants, except that the Owner Trustee shall
not execute any such amendment, supplement or other modification which, by the
express provisions of any of the above documents, requires the consent of any
other party unless such consent shall have been obtained; and provided that,
without the prior written consent of each Owner Participant, (i) no such
supplement, amendment or modification shall (A) modify any of the provisions of
this Section 10.01, the definition of "Majority in Interest of Owner
Participants" in Section 1.01 hereof or Article IV hereof, (B) reduce, modify
or amend any indemnities in favor of any Owner Participant as set forth in
Section 7 of the Participation Agreement or in the Tax Indemnity Agreement, (C)
reduce the amount or extend the time of payment of Basic Rent, Supplemental
Rent, Termination Value or Stipulated Loss Value for the Aircraft as set forth
in the Lease and (ii) no such supplement, amendment or modification shall
require any Owner Participant to invest or advance funds or shall entail any
additional personal liability or the surrender of any indemnification, claim or
individual right on the part of any Owner Participant with respect to any
agreement or obligation.
(b) Delivery of Amendments and Supplements to Certain
Parties. A signed copy of each amendment or supplement referred to in Section
10.01(a) hereof shall be delivered by the Owner Trustee to the Indenture
Trustee and the Lessee.
SECTION 10.02. Discretion as to Execution of Documents.
Prior to executing any document required to be executed by it pursuant to the
terms of Section 10.01 hereof, the Owner Trustee shall be entitled to receive
an opinion of its counsel to the effect that the execution of such document is
authorized hereunder. If in the opinion of the Owner Trustee any
18
24
[Trust Agreement (1994 737 B)]
such document adversely affects any right, duty, immunity or indemnity in favor
of the Owner Trustee hereunder or under any other Operative Document to which
the Owner Trustee is a party, the Owner Trustee may in its discretion decline
to execute such document.
SECTION 10.03. Absence of Requirements as to Form. It shall
not be necessary for any written request furnished pursuant to Section 10.01
hereof to specify the particular form of the proposed documents to be executed
pursuant to such Section, but it shall be sufficient if such request shall
indicate the substance thereof.
SECTION 10.04. Distribution of Documents. Promptly after
the execution by the Owner Trustee of any document entered into pursuant to
Section 10.01 hereof, the Owner Trustee shall mail, by certified mail, postage
prepaid, a conformed copy thereof to each Owner Participant, but the failure of
the Owner Trustee to mail such conformed copy shall not impair or affect the
validity of such document.
SECTION 10.05. No Request Needed as to Lease Supplement and
Trust Supplement. No written request pursuant to Section 10.01 hereof shall be
required to enable the Owner Trustee to enter into the Lease Supplement
covering the Aircraft with Lessee pursuant to the terms of the Lease and
Section 3.01(c) hereof and the Trust Supplement pursuant to the terms of the
Trust Indenture and Section 3.01(d) hereof.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Termination of Trust Agreement. This Trust
Agreement and the trusts created hereby shall be of no further force or effect
upon the earlier of (a) both the final discharge of the Trust Indenture
pursuant to Section 10.01 thereof, the termination of the Lease pursuant to its
terms and the sale or other final disposition by the Owner Trustee of all
property constituting part of the Trust Estate and the final distribution by
the Owner Trustee of all monies or other property or proceeds constituting part
of the Trust Estate in accordance with Article IV hereof, provided that at such
time Lessee shall have fully complied with all of the terms of the Lease and
the Participation Agreement or (b) twenty-one years less one day after the
death of the last survivor of all of the descendants of the grandparents of
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ living on the date of the earliest execution of this Trust
Agreement by any party hereto, but if this Trust Agreement and the trusts
created hereby shall be or become authorized under applicable law to be valid
for a period commencing on the 21st anniversary of the death of such last
survivor (or, without limiting the generality of the foregoing, if legislation
shall become effective providing for the validity of this Trust Agreement and
the trusts created hereby for a period in gross
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[Trust Agreement (1994 737 B)]
exceeding the period for which this Trust Agreement and the trusts created
hereby are hereinabove stated to extend and be valid), then this Trust
Agreement and the trusts created hereby shall not terminate under this
subsection (b) but shall extend to and continue in effect, but only if such
nontermination and extension shall then be valid under applicable law, until
the day preceding such date as the same shall, under applicable law, cease to
be valid; otherwise this Trust Agreement and the trusts created hereby shall
continue in full force and effect in accordance with the term hereof, subject
to the Owner Participant's right to revoke such trusts and cause the Trust
Estate (subject to the Lien of the Trust Indenture) to be distributed.
SECTION 11.02. Owner Participants Have No Legal Title in
Trust Estate. The Owner Participants shall not have legal title to any part of
the Trust Estate. No transfer, by operation of law or otherwise, of any right,
title and interest of the Owner Participant in and to the Trust Estate
hereunder shall operate to terminate this Trust Agreement or the trusts
hereunder or entitle any successors or transferees of the Owner Participants to
an accounting or to the transfer of legal title to any part of the Trust
Estate.
SECTION 11.03. Assignment, Sale, etc. of Aircraft. Any
assignment, sale, transfer or other conveyance of the Aircraft by the Owner
Trustee made pursuant to the terms hereof or of the Lease or the Participation
Agreement shall bind the Owner Participants and shall be effective to transfer
or convey all right, title and interest of the Owner Trustee and the Owner
Participants 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 assignment, sale, transfer or conveyance or as to the
application of any sale or other proceeds with respect thereto by the Owner
Trustee.
SECTION 11.04. Trust Agreement for Benefit of Certain
Parties Only. Except for the terms of Section 8(l) of the Participation
Agreement incorporated in Article VIII hereof and except as otherwise provided
in Article IX hereof and Section 11.01 hereof, nothing herein, whether
expressed or implied, shall be construed to give any person other than the
Owner Trustee and the Owner Participants any legal or equitable right, remedy
or claim under or in respect of this Trust Agreement; but this Trust Agreement
shall be held to be for the sole and exclusive benefit of the Owner Trustee and
the Owner Participants.
SECTION 11.05. Citizenship of the Owner Participant. If at
any time there shall be more than one Owner Participant, then any Owner
Participant who shall cease to be a "citizen of the United States" as defined
in Section 40102(a)(15) of the Transportation Code, shall have no voting or
similar rights hereunder and shall have no right to direct, influence or limit
the exercise of, or to prevent the direction or influence of, or place any
limitation on the exercise of, the Owner Trustee's authority or to remove the
Owner Trustee.
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[Trust Agreement (1994 737 B)]
SECTION 11.06. Notices. All notices, demands, instructions
and other communications required or permitted to be given to or made upon any
party hereto shall be in writing and shall be personally delivered or sent by
registered or certified mail, postage prepaid, or by telecopier, or by prepaid
courier service, and shall be deemed to be given for purposes of this Trust
Agreement on the day that such writing is delivered or, if sent by registered
or certified mail, three Business Days after being deposited in the mails
addressed to the intended recipient thereof in accordance with the provisions
of this Section 11.06. Unless otherwise specified in a notice sent or
delivered in accordance with the foregoing provisions of this Section 11.06,
notices, demands, instructions and other communications in writing shall be
given to or made upon the respective parties hereto at their respective
addresses (or to their respective telecopier numbers) as follows: (A) if to
Lessee, the Owner Trustee, the Indenture Trustee or the Original Owner
Participant, to the respective addresses set forth on Schedule I to the
Participation Agreement, or (B) if to a Subsequent Owner Participant, addressed
to such Subsequent Owner Participant at such address as such Subsequent Owner
Participant shall have furnished by notice to the parties hereto or (C) if to
any Holder, addressed to such Holder at its address as set forth in the
Certificate register maintained pursuant to Section 2.07 of the Trust
Indenture.
SECTION 11.07. Severability. Subject to Section 11.12
hereof, any provision hereof which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 11.08. Waivers, etc. No term or provision hereof
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing entered into in compliance with the terms of Article X
hereof; and any waiver of the terms hereof shall be effective only in the
specific instance and for the specific purpose given.
SECTION 11.09. Counterparts. This Trust Agreement may be
executed by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 11.10. Binding Effect, etc. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
the Owner Trustee and its successors and assigns, and the Owner Participants,
their successors and, to the extent permitted by Article VIII hereof, their
assigns. Any request, notice, direction, consent, waiver or other instrument or
action by an Owner Participant shall bind its successors and assigns. Any
Owner Participant which shall cease to have any Ownership Interest shall
thereupon cease to be a party hereto or an Owner Participant for any reason and
shall have no further obligations hereunder.
SECTION 11.11. Headings; References. The headings of the
various Articles and Sections herein are for convenience of reference only and
shall not define or limit any of the terms or provisions hereof.
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[Trust Agreement (1994 737 B)]
SECTION 11.12. Governing Law. THIS TRUST AGREEMENT SHALL IN
ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL
LAWS OF THE STATE OF UTAH, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE.
SECTION 11.13. Performance by the Owner Participant. Any
obligation of the Owner Trustee in its individual capacity or as Owner Trustee
hereunder or under any other Operative Document or other document contemplated
herein, may be performed by any Owner Participant and any such performance
shall not be construed as a revocation of the trust created hereby.
* * *
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[Trust Agreement (1994 737 B)]
IN WITNESS WHEREOF, the parties hereto have caused this
Trust Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
MS FINANCING INC.
By:
-------------------------------
Title:
----------------------------
FIRST SECURITY BANK OF UTAH,
NATIONAL ASSOCIATION
By:
-------------------------------
Title:
----------------------------
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