Exhibit 10.4
________________________________________________________________________________
REVOLVING CREDIT AGREEMENT
Dated as of September 27, 2000
between
ALLFIRST BANK
not in its individual capacity but solely
as Subordination Agent,
as agent and trustee for the
Midway Airlines Pass Through Trust 2000-1B,
as Borrower
and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL SERVICES INC.,
as Liquidity Provider
________________________________________________________________________________
Relating to
Midway Airlines Pass Through Trust 2000-1B
10.07% Midway Airlines Pass Through Certificates,
Series 2000-1B
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms................................................................... 1
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. The Advances........................................................................... 8
Section 2.02. Making the Advances.................................................................... 8
Section 2.03. Fees................................................................................... 10
Section 2.04. Reduction or Termination of the Maximum Commitment..................................... 10
Section 2.05. Repayments of Interest Advances or the Final Advance................................... 11
Section 2.06. Repayments of Provider Advances........................................................ 11
Section 2.07. Payments to the Liquidity Provider
Under the Intercreditor Agreement...................................................... 12
Section 2.08. Book Entries........................................................................... 13
Section 2.09. Payments from Available Funds Only..................................................... 13
Section 2.10. Extension of the Expiry Date; Non-Extension Advance.................................... 13
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01 Increased Costs........................................................................ 14
Section 3.02 Capital Adequacy....................................................................... 15
Section 3.03. Payments Free of Deductions............................................................ 15
Section 3.04. Payments............................................................................... 16
Section 3.05. Computations........................................................................... 16
Section 3.06. Payment on Non-Business Days........................................................... 16
Section 3.07. Interest............................................................................... 17
Section 3.08. Replacement of Borrower................................................................ 18
Section 3.09. Funding Loss Indemnification........................................................... 18
Section 3.10. Illegality............................................................................. 19
i
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.................................. 19
Section 4.02. Conditions Precedent to Borrowing...................................................... 21
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants of the Borrower.................................................. 21
Section 5.02. Negative Covenants of the Borrower..................................................... 22
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. Liquidity Events of Default............................................................ 22
ARTICLE VII
MISCELLANEOUS
Section 7.01. Amendments, Etc........................................................................ 23
Section 7.02. Notices, Etc........................................................................... 23
Section 7.03. No Waiver: Remedies.................................................................... 23
Section 7.04. Further Assurances..................................................................... 24
Section 7.05. Indemnification; Survival of Certain Provisions........................................ 24
Section 7.06. Liability of the Liquidity Provider.................................................... 24
Section 7.07. Costs, Expenses and Taxes.............................................................. 25
Section 7.08. Binding Effect; Participations......................................................... 25
Section 7.09. Severability........................................................................... 27
Section 7.10. GOVERNING LAW.......................................................................... 27
Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial;
Waiver of Immunity..................................................................... 27
Section 7.12. Execution in Counterparts.............................................................. 28
Section 7.13. Entirety............................................................................... 28
Section 7.14. Headings............................................................................... 28
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION
TO MAKE ADVANCES....................................................................... 28
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ANNEX I Interest Advance Notice of Borrowing
ANNEX II Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV Final Advance Notice of Borrowing
ANNEX V Notice of Termination
ANNEX VI Notice of Replacement Subordination Agent
EXHIBIT I Form of Guarantee Agreement
iii
REVOLVING CREDIT AGREEMENT
This REVOLVING CREDIT AGREEMENT dated as of September 27, 2000,
between ALLFIRST BANK, a Maryland state-chartered commercial bank ("Allfirst"),
--------
not in its individual capacity but solely as Subordination Agent under the
Intercreditor Agreement (each as defined below), as agent and trustee for the
Class B Trust (as defined below) (the "Borrower"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL
--------
SERVICES INC., a Delaware corporation ("MSCS" or the "Liquidity Provider").
---- ------------------
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Class B Trust Agreement (such term and all
other capitalized terms used in these recitals having the meanings set forth or
referred to in Section 1.01), the Class B Trust is issuing the Class B
Certificates;
WHEREAS, the Borrower, in order to support the timely payment of a
portion of the interest on the Class B Certificates in accordance with their
terms, has requested the Liquidity Provider to enter into this Agreement,
providing in part for the Borrower to request in specified circumstances that
Advances be made hereunder; and
WHEREAS, the Liquidity Provider has requested ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ & Co. (the "Guarantor") to enter into a Guarantee Agreement, providing
---------
for the full and unconditional guarantee of the Liquidity Provider's obligations
under this Agreement (the "Guarantee Agreement");
-------------------
NOW, THEREFORE, in consideration of the premises, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms. (a) Definitions. As used in
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this Agreement and unless otherwise expressly indicated, or unless the context
clearly requires otherwise, the following capitalized terms shall have the
following respective meanings for all purposes of this Agreement:
"Additional Cost" has the meaning assigned to such term in Section
---------------
3.01.
2
"Advance" means an Interest Advance, a Final Advance or a Provider
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Advance, as the case may be.
"Applicable Liquidity Rate" has the meaning assigned to such term in
-------------------------
Section 3.07(f).
"Applicable Margin" means (x) with respect to any Unpaid Advance or
-----------------
Applied Provider Advance, 2.25% and (y) with respect to any Unapplied
Downgrade Advance or Unapplied Non-Extension Advance, 0.50 %.
"Applied Downgrade Advance" has the meaning assigned to such term in
-------------------------
Section 2.06(a).
"Applied Non-Extension Advance" has the meaning assigned to such term
-----------------------------
in Section 2.06(a).
"Applied Provider Advance" has the meaning assigned to such term in
------------------------
Section 2.06(a).
"Base Rate" means a fluctuating interest rate per annum in effect from
---------
time to time, which rate per annum shall at all times be equal to (a) the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or if such
rate is not so published for any day that is a Business Day, the average of
the quotations for such day for such transactions received by the Liquidity
Provider from three Federal funds brokers of recognized standing selected
by it, plus (b) one-quarter of one percent (1/4 of 1%).
"Base Rate Advance" means an Advance that bears interest at a rate
-----------------
based upon the Base Rate.
"Borrower" has the meaning assigned to such term in the recital of
--------
parties to this Agreement.
"Borrowing" means the making of Advances requested by delivery of a
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Notice of Borrowing.
"Business Day" means any day other than a Saturday or Sunday or a day
------------
on which commercial banks are required or authorized to close in Charlotte,
North Carolina, Baltimore, Maryland, New York, New York, or, so long as any
Class B Certificate is
3
outstanding, the city and state in which the Class B Trustee, the Borrower
or any Loan Trustee maintains its Corporate Trust Office or receives or
disburses funds, and, if the applicable Business Day relates to any Advance
or other amount bearing interest based on the LIBOR Rate, on which dealings
are carried on in the London interbank market.
"Depositary" has the meaning assigned to such term in the Deposit
----------
Agreement.
"Deposit Agreement" means the Deposit Agreement dated the Closing Date
-----------------
between First Union Trust Company, National Association, as Escrow Agent
and Allfirst Bank, as Depositary, pertaining to the Class B Certificates,
as the same may be amended, modified or supplemented from time to time in
accordance with the terms thereof.
"Downgrade Advance" means an Advance made pursuant to Section 2.02(c).
-----------------
"Effective Date" has the meaning specified in Section 4.01. The
--------------
delivery of the certificate of the Liquidity Provider contemplated by
Section 4.01(e) shall be conclusive evidence that the Effective Date has
occurred.
"Excluded Taxes" means (i) taxes imposed on the overall net income of
--------------
the Liquidity Provider or of its Lending Office by the jurisdiction where
such Liquidity Provider's principal office or such Lending Office is
located, and (ii) Excluded Withholding Taxes.
"Excluded Withholding Taxes" means (i) withholding Taxes imposed by
--------------------------
the United States except to the extent that such United States withholding
Taxes are imposed as a result of any change in applicable law after the
date hereof (excluding from change in applicable law for this purpose a
change in an applicable treaty or other change in law affecting the
applicability of a treaty), or in the case of a successor Liquidity
Provider (including a transferee of an Advance) or Lending Office, after
the date on which such successor Liquidity Provider obtains its interest or
on which the Lending Office is changed, and (ii) any withholding Taxes
imposed by the United States which are imposed or increased as a result of
the Liquidity Provider failing to deliver to the Borrower any certificate
or document (which certificate or document in the good faith judgment of
the Liquidity Provider it is legally entitled to provide) which is
reasonably requested by the Borrower to establish that payments under this
Agreement are exempt from (or entitled to a reduced rate of) withholding
Tax.
"Expenses" means liabilities, obligations, damages, settlements,
--------
penalties, claims, actions, suits, costs, expenses, and disbursements
(including, without limitation, reasonable fees and disbursements of legal
counsel and costs of investigation), provided that Expenses shall not
include any Taxes.
4
"Expiry Date" means September 25, 2001, initially, or any date to
-----------
which the Expiry Date is extended pursuant to Section 2.10.
"Final Advance" means an Advance made pursuant to Section 2.02(d).
-------------
"Guarantee Agreement" has the meaning assigned to such term in the
-------------------
preliminary statements of this Agreement.
"Guarantee Event" has the meaning specified in Section 2.02(c)
---------------
"Guarantor" has the meaning assigned to such term in the preliminary
---------
statements of this Agreement.
"Intercreditor Agreement" means the Intercreditor Agreement dated the
-----------------------
date hereof, among the Trustees, the Liquidity Provider, the liquidity
provider under each Liquidity Facility (other than this Agreement) and the
Subordination Agent, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Interest Advance" means an Advance made pursuant to Section 2.02(a).
----------------
"Interest Period" means, with respect to any LIBOR Advance, each of
---------------
the following periods:
(i) the period beginning on the third Business Day following either
(x) the Liquidity Provider's receipt of the Notice of Borrowing
for such LIBOR Advance or (y) the withdrawal of funds from the
Class B Cash Collateral Account for the purpose of paying
interest on the Class B Certificates as contemplated by Section
2.06(a) hereof and, in either case, ending on the next Regular
Distribution Date (or ending, in the case of an Interest Period
applicable to any Unapplied Provider Advance, on the numerically
corresponding day in the first or sixth calendar month after the
first day of the applicable Interest Period and/or on the next
Regular Distribution Date, as Midway may select by providing
notice thereof to the Borrower and the Liquidity Provider no
later than three Business Days prior to the commencement of such
Interest Period, provided that if Midway shall not provide such a
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notice at least three Business Days prior to the commencement of
such Interest Period, then Midway shall be deemed to have
selected an Interest Period ending on the next Regular
Distribution Date); and
5
(ii) each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the next
Regular Distribution Date (or ending, in the case of an Interest
Period applicable to any Unapplied Provider Advance, on the
numerically corresponding day in the first or sixth calendar
month after the first day of the applicable Interest Period
and/or on the next Regular Distribution Date, as Midway may
select by providing notice thereof to the Borrower and the
Liquidity Provider no later than three Business
Days prior to the commencement of such Interest Period, provided
--------
that if Midway shall not provide such a notice at least three
Business Days prior to the commencement of such Interest Period,
then Midway shall be deemed to have selected an Interest Period
ending on the next Regular Distribution Date);
provided, however, that (I) if an Unapplied Provider Advance which is a
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LIBOR Advance becomes an Applied Provider Advance, the Interest Period then
applicable to such Unapplied Provider Advance shall be applicable to such
Applied Provider Advance, (II) if (x) the Final Advance shall have been
made, or (y) other outstanding Advances shall have been converted into the
Final Advance, then the Interest Periods shall be successive periods of one
month beginning on the third Business Day following the Liquidity
Provider's receipt of the Notice of Borrowing for such Final Advance (in
the case of clause (x) above) or the Regular Distribution Date following
such conversion (in the case of clause (y) above) and (III) each Interest
Period shall end on or prior to the next Regular Distribution Date.
"Leased Aircraft Participation Agreement" means a participation
---------------------------------------
agreement substantially in the form of Exhibit A-1 to the Note Purchase
Agreement.
"Lending Office" means the lending office of the Liquidity Provider
--------------
presently located at New York, New York, or such other lending office as
the Liquidity Provider from time to time shall notify the Borrower as its
lending office hereunder; provided that the Liquidity Provider shall not
change its Lending Office to a Lending Office outside the United States of
America except in accordance with Section 3.01, 3.02 or 3.03 hereof.
"LIBOR Advance" means an Advance bearing interest at a rate based upon
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the LIBOR Rate.
"LIBOR Rate" means, with respect to any Interest Period, (i) the rate
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per annum appearing on display page 3750 (British Bankers Association-
LIBOR) of the Dow ▇▇▇▇▇ Markets Service (or any successor or substitute
therefor) at approximately 11:00 A.M. (London time) two Business Days
before the first day of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period, or (ii) if the
rate
6
calculated pursuant to clause (i) above is not available, the average
(rounded upwards, if necessary, to the next 1/16 of 1%) of the rates per
annum at which deposits in dollars are offered for the relevant Interest
Period by three banks of recognized standing selected by the Liquidity
Provider in the London interbank market at approximately 11:00 A.M. (London
time) two Business Days before the first day of such Interest Period in an
amount approximately equal to the principal amount of the LIBOR Advance to
which such Interest Period is to apply and for a period comparable to such
Interest Period.
"Liquidity Event of Default" means the occurrence of either (a) the
--------------------------
Acceleration of all of the Equipment Notes or (b) an Midway Bankruptcy
Event.
"Liquidity Indemnitee" means (i) the Liquidity Provider, (ii) the
--------------------
Guarantor, (iii) the respective directors, officers, employees and agents
of the Liquidity Provider and the Guarantor, and (iv) the successors and
permitted assigns of the persons described in clauses (i) through (iii),
inclusive.
"Liquidity Provider" has the meaning assigned to such term in the
------------------
recital of parties to this Agreement.
"Maximum Commitment" shall mean, subject to the proviso contained in
------------------
the third sentence of Section 2.02(a), at any time of determination, (a)
the Required Amount at such time less (b) the aggregate amount of each
Interest Advance outstanding at such time; provided that following a
Provider Advance or a Final Advance, the Maximum Commitment shall be zero.
"Non-Extension Advance" means an Advance pursuant to Section 2.02(b).
---------------------
"Notice of Borrowing" has the meaning specified in Section 2.02(e).
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"Notice of Replacement Subordination Agent" has the meaning specified
-----------------------------------------
in Section 3.08.
"Offering Memorandum" means the Offering Memorandum dated September
-------------------
22, 2000 relating to the Certificates.
"Owned Aircraft Participation Agreement" means a participation
--------------------------------------
agreement substantially in the form of Exhibit C-1 to the Note Purchase
Agreement.
"Participation Agreements" means, collectively, the Leased Aircraft
------------------------
Participation Agreement and the Owned Aircraft Participation Agreement.
7
"Performing Note Deficiency" means any time that less than 65% of the
--------------------------
then aggregate outstanding principal amount of all Equipment Notes are
Performing Equipment Notes.
"Provider Advance" means a Downgrade Advance or a Non-Extension
----------------
Advance.
"Regulatory Change" has the meaning assigned to such term in Section
-----------------
3.01.
"Replenishment Amount" has the meaning assigned to such term in
--------------------
Section 2.06(b).
"Required Amount" means, for any day, the sum of the aggregate amount
---------------
of interest, calculated at the rate per annum equal to the Stated Interest
Rate for the Class B Certificates, that would be payable on the Class B
Certificates on each of the three successive semiannual Regular
Distribution Dates immediately following such day or, if such day is a
Regular Distribution Date, on such day and the succeeding two semiannual
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of the Class B Certificates on such day and without regard to
expected future payments of principal on the Class B Certificates.
"Termination Date" means the earliest to occur of the following: (i)
----------------
the Expiry Date; (ii) the date on which the Borrower delivers to the
Liquidity Provider a certificate, signed by a Responsible Officer of the
Borrower, certifying that all of the Class B Certificates have been paid in
full (or provision has been made for such payment in accordance with the
Intercreditor Agreement and the Trust Agreements) or are otherwise no
longer entitled to the benefits of this Agreement; (iii) the date on which
the Borrower delivers to the Liquidity Provider a certificate, signed by a
Responsible Officer of the Borrower, certifying that a Replacement
Liquidity Facility has been substituted for this Agreement in full pursuant
to Section 3.6(e) of the Intercreditor Agreement; (iv) the fifth Business
Day following the receipt by the Borrower of a Termination Notice from the
Liquidity Provider pursuant to Section 6.01 hereof; and (v) the date on
which no Advance is or may (including by reason of reinstatement as herein
provided) become available for a Borrowing hereunder.
"Termination Notice" means the Notice of Termination substantially in
------------------
the form of Annex IV to this Agreement.
"Transferee" has the meaning assigned to such term in Section 7.08(b).
----------
"Unapplied Downgrade Advance" means any Downgrade Advance other than
---------------------------
an Applied Downgrade Advance.
8
"Unapplied Non-Extension Advance" means any Non-Extension Advance
-------------------------------
other than an Applied Non-Extension Advance.
"Unapplied Provider Advance" means any Provider Advance other than an
--------------------------
Applied Provider Advance.
"Unpaid Advance" has the meaning assigned to such term in Section
--------------
2.05.
(b) Terms Defined in the Intercreditor Agreement. For all purposes
--------------------------------------------
of this Agreement, the following terms shall have the respective meanings
assigned to such terms in the Intercreditor Agreement:
"Acceleration", "Midway", "Midway Bankruptcy Event", "Certificates", "Class
------------ ------ ----------------------- ------------ -----
B Cash Collateral Account", "Class B Certificates", "Class B
------------------------- -------------------- -------
Certificateholder", "Class B Trust", "Class B Trust Agreement", "Class B
----------------- ------------- ----------------------- -------
Trustee", "Class A Certificates", "Class C Certificates", "Closing Date",
------- -------------------- -------------------- ------------
"Controlling Party", "Corporate Trust Office", "Distribution Date",
----------------- ---------------------- -----------------
"Downgraded Facility", "Equipment Notes", "Final Legal Distribution Date",
-------------------- --------------- -----------------------------
"Financing Agreement", "Indenture", "Interest Payment Date", "Investment
------------------- --------- --------------------- ----------
Earnings", "Liquidity Facility", "Liquidity Obligations", "Loan Trustee",
-------- ------------------ --------------------- ------------
"MSCS Fee Letter", "MSCS Liquidity Facilities", "Non-Extended Facility",
---------------- ------------------------- ---------------------
"Note Purchase Agreement", "Operative Agreements", "Performing Equipment
------------------------ -------------------- --------------------
Note", "Person", "Placement Agents", "Placement Agreement", "Pool Balance",
---- ------ ---------------- ------------------- ------------
"Rating Agencies", "Ratings Confirmation", "Regular Distribution Dates",
--------------- -------------------- --------------------------
"Replacement Liquidity Facility", "Responsible Officer", "Scheduled
------------------------------- ------------------- ---------
Payment", "Special Payment", "Stated Interest Rate", "Subordination Agent",
--------------- -------------------- -------------------
"Taxes", "Threshold Rating", "Trust Agreement", "Trustee", and "Written
----- ---------------- --------------- ------- -------
Notice".
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ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. The Advances. The Liquidity Provider hereby
------------
irrevocably agrees, on the terms and conditions hereinafter set forth, to make
Advances to the Borrower from time to time on any Business Day during the period
from the Effective Date until 12:00 Noon (New York City time) on the Expiry Date
(unless the obligations of the Liquidity Provider shall be earlier terminated in
accordance with the terms of Section 2.04(b)) in an aggregate amount at any time
outstanding not to exceed the Maximum Commitment.
Section 2.02. Making the Advances. (a) Interest Advances shall be
-------------------
made in one or more Borrowings by delivery to the Liquidity Provider of one or
more written and completed
9
Notices of Borrowing in substantially the form of Annex I attached hereto,
signed by a Responsible Officer of the Borrower, in an amount not exceeding the
Maximum Commitment at such time and shall be used solely for the payment when
due of the interest on the Class B Certificates at the Stated Interest Rate
therefor in accordance with Section 3.6(a) of the Intercreditor Agreement. Each
Interest Advance made hereunder shall automatically reduce the Maximum
Commitment and the amount available to be borrowed hereunder by subsequent
Advances by the amount of such Interest Advance (subject to reinstatement as
provided in the next sentence). Upon repayment to the Liquidity Provider in full
of the amount of any Interest Advance made pursuant to this Section 2.02(a),
together with accrued interest thereon (as provided herein), the Maximum
Commitment shall be reinstated by the amount of such repaid Interest Advance;
provided, however, that the Maximum Commitment shall not be so reinstated at
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any time if (i) a Liquidity Event of Default shall have occurred and be
continuing and (ii) there is a Performing Note Deficiency.
(b) A Non-Extension Advance shall be made in a single Borrowing if
this Agreement is not extended in accordance with Section 3.6(d) of the
Intercreditor Agreement (unless a Replacement Liquidity Facility to replace this
Agreement shall have been delivered to the Borrower as contemplated by said
Section 3.6(d) within the time period specified in such Section) by delivery to
the Liquidity Provider of a written and completed Notice of Borrowing in
substantially the form of Annex II attached hereto, signed by a Responsible
Officer of the Borrower, in an amount equal to the Maximum Commitment at such
time, and shall be used to fund the Class B Cash Collateral Account in
accordance with said Section 3.6(d) and Section 3.6(f) of the Intercreditor
Agreement.
(c) A Downgrade Advance shall be made in a single Borrowing, as
provided for in Section 3.6(c) of the Intercreditor Agreement, (i) upon a
downgrading of the Guarantor's short-term unsecured debt rating issued by either
Rating Agency below the applicable Threshold Rating or (ii) if the Guarantee
Agreement ceases to be in full force and effect, becomes invalid or
unenforceable or the Guarantor denies its liability thereunder (any such
occurrence, a "Guarantee Event"), unless a Replacement Liquidity Facility to
replace this Agreement shall have been previously delivered to the Borrower in
accordance with said Section 3.6(c), by delivery to the Liquidity Provider of a
written and completed Notice of Borrowing in substantially the form of Annex III
attached hereto, signed by a Responsible Officer of the Borrower, in an amount
equal to the Maximum Commitment at such time, and shall be used to fund the
Class B Cash Collateral Account in accordance with said Section 3.6(c) and
Section 3.6(f) of the Intercreditor Agreement.
(d) A Final Advance shall be made in a single Borrowing upon the
receipt by the Borrower of a Termination Notice from the Liquidity Provider
pursuant to Section 6.01 hereof by delivery to the Liquidity Provider of a
written and completed Notice of Borrowing in substantially the form of Annex IV
attached hereto, signed by a Responsible Officer of the
10
Borrower, in an amount equal to the Maximum Commitment at such time, and shall
be used to fund the Class B Cash Collateral Account (in accordance with Section
3.6(i) of the Intercreditor Agreement) and Section 3.6(f) of the Intercreditor
Agreement.
(e) Each Borrowing shall be made on notice in writing(a "Notice of
---------
Borrowing") in substantially the form required by Section 2.02(a), 2.02(b),
---------
2.02(c) or 2.02(d), as the case may be, given by the Borrower to the Liquidity
Provider. If a Notice of Borrowing is delivered by the Borrower in respect of
any Borrowing no later than 1:00 PM (New York City time) on a Business Day, upon
satisfaction of the conditions precedent set forth in Section 4.02 with respect
to a requested Borrowing, the Liquidity Provider shall make available to the
Borrower, in accordance with its payment instructions, the amount of such
Borrowing in U.S. dollars and immediately available funds, before 4:00 PM (New
York City time) on the day of receipt of such Notice of Borrowing or on such
later Business Day specified in such Notice of Borrowing. If a Notice of
Borrowing is delivered by the Borrower in respect of any Borrowing after 1:00 PM
(New York City time) on a Business Day, upon satisfaction of the conditions
precedent set forth in Section 4.02 with respect to a requested Borrowing, the
Liquidity Provider shall make available to the Borrower, in accordance with its
payment instructions, the amount of such Borrowing in U.S. dollars and
immediately available funds, before 4:00 PM (New York City time) on the first
Business Day next following the day of receipt of such Notice of Borrowing or on
such later Business Day specified by the Borrower in such Notice of Borrowing.
Payments of proceeds of a Borrowing shall be made by wire transfer of
immediately available funds to the Borrower in accordance with such wire
transfer instructions as the Borrower shall furnish from time to time to the
Liquidity Provider for such purpose. Each Notice of Borrowing shall be
irrevocable and binding on the Borrower.
(f) Upon the making of any Advance requested pursuant to a Notice of
Borrowing, in accordance with the Borrower's payment instructions, the Liquidity
Provider shall be fully discharged of its obligation hereunder with respect to
such Notice of Borrowing, and the Liquidity Provider shall not thereafter be
obligated to make any further Advances hereunder in respect of such Notice of
Borrowing to the Borrower or to any other Person. If the Liquidity Provider
makes an Advance requested pursuant to a Notice of Borrowing before 12:00 Noon
(New York City time) on the second Business Day after the date of payment
specified in said Section 2.02(e), the Liquidity Provider shall have fully
discharged its obligations hereunder with respect to such Advance and an event
of default shall not have occurred hereunder. Following the making of any
Advance pursuant to Section 2.02(b), (c) or (d) hereof to fund the Class B Cash
Collateral Account, the Liquidity Provider shall have no interest in or rights
to the Class B Cash Collateral Account, such Advance or any other amounts from
time to time on deposit in the Class B Cash Collateral Account; provided that
the foregoing shall not affect or impair the obligations of the Subordination
Agent to make the distributions contemplated by Section 3.6(e) or (f) of the
Intercreditor Agreement. By paying to the Borrower proceeds of Advances
requested by the Borrower in accordance with the provisions of this Agreement,
the Liquidity
11
Provider makes no representation as to, and assumes no responsibility for, the
correctness or sufficiency for any purpose of the amount of the Advances so made
and requested.
Section 2.03. Fees. Subject to Section 2.09, the Borrower agrees to
----
pay to the Liquidity Provider the fees set forth in the MSCS Fee Letter.
Section 2.04. Reduction or Termination of the Maximum Commitment.
--------------------------------------------------
(a) Automatic Reduction. Promptly following each date on which the
-------------------
Required Amount is reduced as a result of a reduction in the Pool Balance of the
Class B Certificates or otherwise, the Maximum Commitment shall automatically be
reduced to an amount equal to such reduced Required Amount (as calculated by the
Borrower). The Borrower shall give notice of any such automatic reduction of
the Maximum Commitment to the Liquidity Provider within two Business Days
thereof. The failure by the Borrower to furnish any such notice shall not
affect such automatic reduction of the Maximum Commitment.
(b) Termination. Upon the making of any Provider Advance or Final
-----------
Advance hereunder or the occurrence of the Termination Date, the obligation of
the Liquidity Provider to make further Advances hereunder shall automatically
and irrevocably terminate, and the Borrower shall not be entitled to request any
further Borrowing hereunder.
Section 2.05. Repayments of Interest Advances or the Final Advance.
----------------------------------------------------
Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower hereby agrees,
without notice of an Advance or demand for repayment from the Liquidity Provider
(which notice and demand are hereby waived by the Borrower), to pay, or to cause
to be paid, to the Liquidity Provider on each date on which the Liquidity
Provider shall make an Interest Advance or the Final Advance, an amount equal to
(a) the amount of such Advance (any such Advance, until repaid, is referred to
herein as an "Unpaid Advance"), plus (b) interest on the amount of each such
--------------
Unpaid Advance as provided in Section 3.07 hereof; provided that if (i) the
--------
Liquidity Provider shall make a Provider Advance at any time after making one or
more Interest Advances which shall not have been repaid in accordance with this
Section 2.05 or (ii) this Liquidity Facility shall become a Downgraded Facility
or Non-Extended Facility at any time when unreimbursed Interest Advances have
reduced the Maximum Commitment to zero, then such Interest Advances shall cease
to constitute Unpaid Advances and shall be deemed to have been changed into an
Applied Downgrade Advance or Applied Non-Extension Advance for all purposes of
this Agreement (including, without limitation, for the purpose of determining
when such Interest Advance is required to be repaid to the Liquidity Provider in
accordance with Section 2.06 and for the purposes of Section 2.06(b)). The
Borrower and the Liquidity Provider agree that the repayment in full of each
Interest Advance and Final Advance on the date such Advance is made is intended
to be a contemporaneous exchange for new value given to the Borrower by the
Liquidity Provider.
12
Section 2.06. Repayments of Provider Advances. (a) Amounts advanced
-------------------------------
hereunder in respect of a Provider Advance shall be deposited in the Class B
Cash Collateral Account, invested and withdrawn from the Class B Cash Collateral
Account as set forth in Sections 3.6(c), (d) and (f) of the Intercreditor
Agreement. The Borrower agrees to pay to the Liquidity Provider, on each
Regular Distribution Date, commencing on the first Regular Distribution Date
after the making of a Provider Advance, interest on the principal amount of any
such Provider Advance as provided in Section 3.07; provided, however, that
-------- -------
amounts in respect of a Provider Advance withdrawn from the Class B Cash
Collateral Account for the purpose of paying interest on the Class B
Certificates in accordance with Section 3.6(f) of the Intercreditor Agreement
(the amount of any such withdrawal being (x) in the case of a Downgrade Advance,
an "Applied Downgrade Advance" and (y) in the case of a Non-Extension Advance,
-------------------------
an "Applied Non-Extension Advance" and, together with an Applied Downgrade
-----------------------------
Advance, an "Applied Provider Advance") shall thereafter (subject to Section
------------------------
2.06(b)) be treated as an Interest Advance under this Agreement for purposes of
determining the Applicable Liquidity Rate for interest payable thereon; provided
--------
further, however, that if, following the making of a Provider Advance, the
------- -------
Liquidity Provider delivers a Termination Notice to the Borrower pursuant to
Section 6.01 hereof, such Provider Advance shall thereafter be treated as a
Final Advance under this Agreement for purposes of determining the Applicable
Liquidity Rate for interest payable thereon. Subject to Sections 2.07 and 2.09
hereof, immediately upon the withdrawal of any amounts from the Class B Cash
Collateral Account on account of a reduction in the Required Amount, the
Borrower shall repay to the Liquidity Provider a portion of the Provider
Advances in a principal amount equal to such reduction, plus interest on the
principal amount prepaid as provided in Section 3.07 hereof.
(b) At any time when an Applied Provider Advance (or any portion
thereof) is outstanding, upon the deposit in the Class B Cash Collateral Account
of any amount pursuant to clause "third" of Section 2.4(b) of the Intercreditor
Agreement, clause "third" of Section 3.2 of the Intercreditor Agreement or
clause "fourth" of Section 3.3 of the Intercreditor Agreement (any such amount
being a "Replenishment Amount") for the purpose of replenishing or increasing
--------------------
the balance thereof up to the Required Amount at such time, (i) the aggregate
outstanding principal amount of all Applied Provider Advances (and of Provider
Advances treated as an Interest Advance for purposes of determining the
Applicable Liquidity Rate for interest payable thereon) shall be automatically
reduced by the amount of such Replenishment Amount and (ii) the aggregate
outstanding principal amount of all Unapplied Provider Advances shall be
automatically increased by the amount of such Replenishment Amount.
(c) Upon the provision of a Replacement Liquidity Facility in
replacement of this Agreement in accordance with Section 3.6(e) of the
Intercreditor Agreement, amounts remaining on deposit in the Class B Cash
Collateral Account after giving effect to any Applied Provider Advance on the
date of such replacement shall be reimbursed to the Liquidity Provider,
13
but only to the extent such amounts are necessary to repay in full to the
Liquidity Provider all amounts owing to it hereunder.
Section 2.07. Payments to the Liquidity Provider Under the
--------------------------------------------
Intercreditor Agreement. In order to provide for payment or repayment to the
-----------------------
Liquidity Provider of any amounts hereunder, the Intercreditor Agreement
provides that amounts available and referred to in Articles II and III of the
Intercreditor Agreement, to the extent payable to the Liquidity Provider
pursuant to the terms of the Intercreditor Agreement (including, without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid to the
Liquidity Provider in accordance with the terms thereof. Amounts so paid to the
Liquidity Provider shall be applied by the Liquidity Provider to Liquidity
Obligations then due and payable in accordance with the Intercreditor Agreement
or, if not provided for in the Intercreditor Agreement, then in such manner as
the Liquidity Provider shall deem appropriate.
Section 2.08. Book Entries. The Liquidity Provider shall maintain in
------------
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower resulting from Advances made from time to time and
the amounts of principal and interest payable hereunder and paid from time to
time in respect thereof; provided, however, that the failure by the Liquidity
-------- -------
Provider to maintain such account or accounts shall not affect the obligations
of the Borrower in respect of Advances.
Section 2.09. Payments from Available Funds Only. All payments to be
----------------------------------
made by the Borrower under this Agreement shall be made only from the amounts
that constitute Scheduled Payments, Special Payments or payments under Section
7.01 of the Participation Agreements and Section 6 of the Note Purchase
Agreement and only to the extent that the Borrower shall have sufficient income
or proceeds therefrom to enable the Borrower to make payments in accordance with
the terms hereof after giving effect to the priority of payments provisions set
forth in the Intercreditor Agreement. The Liquidity Provider agrees that it
will look solely to such amounts to the extent available for distribution to it
as provided in the Intercreditor Agreement and this Agreement and that the
Borrower, in its individual capacity, is not personally liable to it for any
amounts payable and shall have no liability under this Agreement except as
expressly provided in this Agreement, the Intercreditor Agreement or any
Participation Agreement. Amounts on deposit in the Class B Cash Collateral
Account shall be available to the Borrower to make payments under this Agreement
only to the extent and for the purposes expressly contemplated in Section 3.6(f)
of the Intercreditor Agreement.
Section 2.10. Extension of the Expiry Date; Non-Extension Advance.
---------------------------------------------------
The Expiry Date shall be automatically extended, effective on the 25/th/ day
prior to each Expiry Date (unless such Expiry Date is on or after the date that
is 15 days after the Final Legal Distribution Date for the Class B
Certificates), for a period of 364 days after such Expiry Date (unless the
obligations of the Liquidity Provider are earlier terminated in accordance with
the terms hereof),
14
without the necessity of any act on the part of the Borrower or the Liquidity
Provider, unless the Liquidity Provider shall advise the Borrower prior to such
25/th/ day that it does not agree to such extension of such Expiry Date, in
which event (and if the Liquidity Provider shall not have been replaced in
accordance with Section 3.6(e) of the Intercreditor Agreement), the Borrower
shall be entitled on and after such 25/th/ day (but prior to such Expiry Date)
to request a Non-Extension Advance in accordance with Section 2.02(b) hereof and
Section 3.6(d) of the Intercreditor Agreement.
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01 Increased Costs. If the Liquidity Provider shall
---------------
reasonably determine that (a) any change, after the Effective Date, in any law
or regulation or in the interpretation thereof by any court or administrative or
governmental authority charged with the administration thereof or in the
compliance by the Liquidity Provider(or any corporation controlling the
Liquidity Provider) with any applicable direction, request or requirement
(whether or not having the force of law) of any central bank or competent
governmental or other authority shall impose, modify or deem applicable any
reserve, special deposit or similar requirement against assets held by, or
deposits in or for the account of, or loans or loan commitments made by, the
Liquidity Provider pursuant to this Agreement and (b) the result of any event
referred to in clause (a) shall be to increase the cost to the Liquidity
Provider of issuing or maintaining its commitment hereunder or funding or
maintaining Advances (which increase in cost shall be determined by the
Liquidity Provider's reasonable allocations of the aggregate of such cost
increases resulting from such event among similarly affected credit and funding
facilities), or to reduce the amount of any sum received or receivable by the
Liquidity Provider under this Agreement with respect thereto, then, upon demand
by the Liquidity Provider (such demand to be made as soon as practicable, but
not later than 30 days after a Responsible Officer of the Liquidity Provider
obtains or reasonably should have obtained knowledge of any event referred to in
clause (a) above), and subject to Section 2.09, the Borrower shall pay, or cause
to be paid, to the Liquidity Provider, from time to time as specified by the
Liquidity Provider, additional amounts which shall be sufficient to compensate
the Liquidity Provider for such increased cost or reduction; provided that if
such demand for payment is made after such 30-day period, the Borrower shall be
obligated to pay such additional amounts only with respect to such increased
cost or reduction actually incurred or effected on or after the 30th day prior
to the date of such demand. A certificate as to such increased cost or
reduction (which shall set forth in reasonable detail the basis for such
increased cost on reduction) incurred by the Liquidity Provider as a result of
any event mentioned in clause (a) above, prepared in reasonable detail and
submitted by the Liquidity Provider to the Borrower, shall be conclusive, absent
manifest error, as to the amount thereof.
15
The Liquidity Provider agrees to use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Lending Office if making such change would avoid the need
for, or reduce the amount of, any amount payable under this Section 3.01 that
may thereafter accrue and would not, in the reasonable judgment of the Liquidity
Provider, be otherwise disadvantageous in any material respect to the Liquidity
Provider. The Liquidity Provider agrees that if it shall make a demand for
payment of additional amounts under this Section the Borrower shall have the
right to obtain a Replacement Liquidity Facility in replacement of this
Agreement in accordance with Section 3.6(e) of the Intercreditor Agreement.
Section 3.02 Capital Adequacy. If the Liquidity Provider shall
----------------
reasonably determine that the adoption, after the Effective Date, of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein, or any change, after the Effective Date, in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Liquidity Provider (or any corporation controlling the Liquidity
Provider) with any request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central bank or comparable
agency, has the effect of requiring an increase in the amount of capital
required to be maintained by the Liquidity Provider (or any corporation
controlling the Liquidity Provider) as a consequence of issuing or maintaining
its commitment hereunder or its funding or maintaining Advances and such
increase is based upon the Liquidity Provider's obligations hereunder and in
respect of similar obligations, then, upon demand by the Liquidity Provider
(such demand to be made as soon as is practicable, but not later than 30 days
after a Responsible Officer of the Liquidity Provider obtains or should
reasonably have obtained knowledge of any event referred to above in this
Section 3.02), and subject to Section 2.09, the Borrower shall pay to the
Liquidity Provider, from time to time as specified by the Liquidity Provider,
additional amounts (which amounts shall be determined by the Liquidity
Provider's reasonable allocations of the aggregate of such amounts resulting
from such event among similarly affected credit and funding facilities) which
shall be sufficient to compensate the Liquidity Provider for such increase in
respect of issuing or maintaining its commitment hereunder or its funding or
maintaining Advances; provided that, if such demand for payment is made after
such 30 day period, the Borrower shall be obligated to pay such amounts only
with respect to such increase actually effected on or after the 30th day prior
to the date of such demand. A certificate describing the event (including
setting forth the necessary calculations) resulting in the demand for
compensation by the Liquidity Provider under this Section, prepared in
reasonable detail and submitted by the Liquidity Provider to the Borrower, shall
be conclusive, absent manifest error, as to the amount thereof.
The Liquidity Provider agrees to use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Lending Office if making such change would avoid the need
for, or reduce the amount of, any amount
16
payable under this Section 3.02 that may thereafter accrue and would not, in the
reasonable judgment of the Liquidity Provider, be otherwise disadvantageous in
any material respect to the Liquidity Provider. The Liquidity Provider agrees
that if it shall make a demand for payment of additional amounts under this
Section the Borrower shall have the right to obtain a Replacement Liquidity
Facility in replacement of this Agreement in accordance with Section 3.6(e) of
the Intercreditor Agreement.
Section 3.03. Payments Free of Deductions. (a) All payments made by
---------------------------
the Borrower under this Agreement shall be made free and clear of, and without
reduction for or on account of, any present or future stamp or other taxes,
levies, imposts, duties, charges, fees, deductions, withholdings, restrictions
or conditions of any nature whatsoever now or hereafter imposed, levied,
collected, withheld or assessed, excluding Excluded Taxes (such non-excluded
taxes being referred to herein, collectively, as "Non-Excluded Taxes" and,
------------------
individually, as a "Non-Excluded Tax"). If any Non-Excluded Taxes are required
----------------
to be withheld from any amounts payable to the Liquidity Provider under this
Agreement, the amounts so payable to the Liquidity Provider shall be increased
to the extent necessary to yield to the Liquidity Provider (after payment of all
Non-Excluded Taxes) interest or any other such amounts payable under this
Agreement at the rates or in the amounts specified in this Agreement. The
Liquidity Provider agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Lending Office if making such change would avoid the need
for, or reduce the amount of, any such additional amounts that may thereafter
accrue and would not, in the reasonable judgment of the Liquidity Provider, be
otherwise disadvantageous to the Liquidity Provider. From time to time upon the
reasonable request of the Borrower, the Liquidity Provider agrees to provide to
the Borrower two original Internal Revenue Service Forms W-8 BEN or W-8 ECI, as
appropriate, or any successor or other form prescribed by the Internal Revenue
Service, certifying that the Liquidity Provider is exempt from or entitled to a
reduced rate of United States withholding tax on payments pursuant to this
Agreement.
(b) All payments (including, without limitation, Advances) made by
the Liquidity Provider under this Agreement shall be made free and clear of, and
without reduction for or on account of, any Taxes. If any Taxes are required to
be withheld or deducted from any amounts payable to the Borrower under this
Agreement, the Liquidity Provider shall (i) within the time prescribed therefor
by applicable law pay to the appropriate governmental or taxing authority the
full amount of any such Taxes (and any additional Taxes in respect of the
payment required under clause (ii) hereof) and make such reports or returns in
connection therewith at the time or times and in the manner prescribed by
applicable law, and (ii) pay to the Borrower an additional amount which (after
deduction of all such Taxes) will be sufficient to yield to the Borrower the
full amount which would have been received by it had no such withholding or
deduction been made. Within 30 days after the date of each payment hereunder,
the Liquidity
17
Provider shall furnish to the Borrower the original or a certified copy of (or
other documentary evidence of) the payment of the Taxes applicable to such
payment.
Section 3.04. Payments. The Borrower shall make or cause to be made
--------
each payment to the Liquidity Provider under this Agreement so as to cause the
same to be received by the Liquidity Provider not later than 1:00 P.M. (New York
City time) on the day when due. The Borrower shall make all such payments in
lawful money of the United States of America, to the Liquidity Provider in
immediately available funds, by wire transfer to Citibank, N.A., New York, NY,
ABA No. ▇▇▇▇▇▇▇▇▇, Account Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services Inc., Account
No. ▇▇▇-▇▇-▇▇▇, Reference: Midway Airlines, 2000-1B.
Section 3.05. Computations. All computations of interest based on
------------
the Base Rate shall be made on the basis of a year of 365 or 366 days, as the
case may be, and all computations of interest based on the LIBOR Rate shall be
made on the basis of a year of 360 days, in each case for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest is payable.
Section 3.06. Payment on Non-Business Days. Whenever any payment to
----------------------------
be made hereunder shall be stated to be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day and no additional
interest shall be due as a result (and if so made, shall be deemed to have been
made when due). If any payment in respect of interest on an Advance is so
deferred to the next succeeding Business Day, such deferral shall not delay the
commencement of the next Interest Period for such Advance (if such Advance is a
LIBOR Advance) or reduce the number of days for which interest will be payable
on such Advance on the next interest payment date for such Advance.
Section 3.07. Interest. (a) Subject to Section 2.09, the Borrower
--------
shall pay, or shall cause to be paid, without duplication, interest on (i) the
unpaid principal amount of each Advance from and including the date of such
Advance (or, in the case of an Applied Provider Advance, from and including the
date on which the amount thereof was withdrawn from the Class B Cash Collateral
Account to pay interest on the Class B Certificates) to but excluding the date
such principal amount shall be paid in full (or, in the case of an Applied
Provider Advance, the date on which the Class B Cash Collateral Account is fully
replenished in respect of such Advance) and (ii) any other amount due hereunder
(whether fees, commissions, expenses or other amounts or, to the extent
permitted by law, installments of interest on Advances or any such other amount)
which is not paid when due (whether at stated maturity, by acceleration or
otherwise) from and including the due date thereof to but excluding the date
such amount is paid in full, in each such case, at a fluctuating interest rate
per annum for each day equal to the Applicable Liquidity Rate (as defined below)
for such Advance or such other amount as in effect for such day, but in no event
at a rate per annum greater than the maximum rate permitted by applicable law;
provided, however, that, if at any time the otherwise applicable interest rate
-------- -------
as set
18
forth in this Section 3.07 shall exceed the maximum rate permitted by applicable
law, then any subsequent reduction in such interest rate will not reduce the
rate of interest payable pursuant to this Section 3.07 below the maximum rate
permitted by applicable law until the total amount of interest accrued equals
the amount of interest that would have accrued if such otherwise applicable
interest rate as set forth in this Section 3.07 had at all times been in effect.
(b) Each Advance will be either a Base Rate Advance or a LIBOR
Advance as provided in this Section. Each such Advance will be a Base Rate
Advance for the period from the date of its borrowing to (but excluding) the
third Business Day following the Liquidity Provider's receipt of the Notice of
Borrowing for such Advance. Thereafter, such Advance shall be a LIBOR Advance;
provided that the Borrower (at the direction of the Controlling Party, so long
as the Liquidity Provider is not the Controlling Party) may (x) convert the
Final Advance into a Base Rate Advance on the last day of an Interest Period for
such Advance by giving the Liquidity Provider no less than four Business Days'
prior written notice of such election or (y) elect to maintain the Final Advance
as a Base Rate Advance by not requesting a conversion of the Final Advance to a
LIBOR Advance under Clause (5) of the applicable Notice of Borrowing (or, if
such Final Advance is deemed to have been made without delivery of a Notice of
Borrowing pursuant to Section 2.06, by requesting, prior to 11:00 AM on the
first Business Day immediately following the Borrower's receipt of the
applicable Termination Notice, such that such Final Advance not be converted
from a Base Rate Advance to a LIBOR Advance).
(c) Each LIBOR Advance shall bear interest during each Interest
Period at a rate per annum equal to the LIBOR Rate for such Interest Period plus
the Applicable Margin for such LIBOR Advance, payable in arrears on the last day
of such Interest Period and, in the event of the payment of principal of such
LIBOR Advance on a day other than such last day, on the date of such payment (to
the extent of interest accrued on the amount of principal repaid).
(d) Each Base Rate Advance shall bear interest at a rate per annum
equal to the Base Rate plus the Applicable Margin for such Base Rate Advance,
payable in arrears on each Regular Distribution Date and, in the event of the
payment of principal of such Base Rate Advance on a day other than a Regular
Distribution Date, on the date of such payment (to the extent of interest
accrued on the amount of principal repaid).
(e) Each Unapplied Provider Advance shall bear interest as provided
in Section 3.07(b) hereof plus an amount equal to the amount by which (i) the
----
Investment Earnings plus 0.50% per annum on the outstanding amount from time to
time of such Advance for the period for which interest is calculated pursuant to
clause (ii) hereof exceeds (ii) the amount of interest on such Unapplied
Provider Advance under Section 3.07(b).
(f) Each amount not paid by the Borrower when due hereunder (whether
fees, commissions, expenses or other amounts or, to the extent permitted by
applicable law,
19
installments of interest on Advances but excluding Advances) shall bear interest
at a rate per annum equal to the Base Rate plus 2.00% until paid.
(g) Each change in the Base Rate shall become effective immediately.
The rates of interest specified in this Section 3.07 with respect to any Advance
or other amount shall be referred to as the "Applicable Liquidity Rate".
-------------------------
Section 3.08. Replacement of Borrower. From time to time and subject
-----------------------
to the successor Borrower's meeting the eligibility requirements set forth in
Section 6.9 of the Intercreditor Agreement applicable to the Subordination
Agent, upon the effective date and time specified in a written and completed
Notice of Replacement Subordination Agent in substantially the form of Annex V
attached hereto (a "Notice of Replacement Subordination Agent") delivered to the
-----------------------------------------
Liquidity Provider by the then Borrower, the successor Borrower designated
therein shall be substituted for as the Borrower for all purposes hereunder.
Section 3.09. Funding Loss Indemnification. The Borrower shall pay
----------------------------
to the Liquidity Provider, upon the request of the Liquidity Provider, such
amount or amounts as shall be sufficient (in the reasonable opinion of the
Liquidity Provider) to compensate it for any loss, cost, or expense incurred by
reason of the liquidation or redeployment of deposits or other funds acquired by
the Liquidity Provider to fund or maintain any LIBOR Advance (but excluding loss
of anticipated profits) incurred as a result of:
(1) Any repayment of a LIBOR Advance on a date other than the last
day of the Interest Period for such Advance; or
(2) Any failure by the Borrower to borrow a LIBOR Advance on the date
for borrowing specified in the relevant notice under Section 2.02.
Section 3.10. Illegality. Notwithstanding any other provision in
----------
this Agreement, if any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Liquidity Provider (or its Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall make it unlawful
or impossible for the Liquidity Provider (or its Lending Office) to maintain or
fund its LIBOR Advances, then upon notice to the Borrower by the Liquidity
Provider, the outstanding principal amount of the LIBOR Advances shall be
converted to Base Rate Advances (a) immediately upon demand of the Liquidity
Provider, if such change or compliance with such request, in the judgment of the
Liquidity Provider, requires immediate repayment; or (b) at the expiration of
the last Interest Period to expire before the effective date of any such change
or request.
20
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.
-----------------------------------------------------
Section 2.01 of this Agreement shall become effective on and as of the first
date (the "Effective Date") on which the following conditions precedent have
--------------
been satisfied or waived:
(a) The Liquidity Provider shall have received on or before the
Closing Date each of the following, and in the case of each document delivered
pursuant to paragraphs (i), (ii) and (iii), each in form and substance
satisfactory to the Liquidity Provider:
(i) This Agreement duly executed on behalf of the Borrower;
(ii) The Intercreditor Agreement duly executed on behalf of each of
the parties thereto;
(iii) Fully executed copies of each of the Operative Agreements
executed and delivered on or before the Closing Date (other than this
Agreement and the Intercreditor Agreement);
(iv) A copy of the Offering Memorandum, and specimen copies of the
Class B Certificates;
(v) An executed copy of each document, instrument, certificate and
opinion delivered on or before the Closing Date pursuant to the Class B
Trust Agreement, the Intercreditor Agreement and the other Operative
Agreements (in the case of each such opinion, other than the opinion of
counsel for the Placement Agents, either addressed to the Liquidity
Provider or accompanied by a letter from the counsel rendering such opinion
to the effect that the Liquidity Provider is entitled to rely on such
opinion as of its date as if it were addressed to the Liquidity Provider);
(vi) Evidence that there shall have been made and shall be in full
force and effect, all filings, recordings and/or registrations, and there
shall have been given or taken any notice or other similar action as may be
reasonably necessary or, to the extent reasonably requested by the
Liquidity Provider, reasonably advisable, in order to establish, perfect,
protect and preserve the right, title and interest, remedies, powers,
privileges, liens and security interests of, or for the benefit of, the
Trustees, the Borrower and the Liquidity Provider created by the Operative
Agreements executed and delivered on or prior to the Closing Date;
21
(vii) An agreement from Midway, pursuant to which (i) Midway agrees
to provide copies of quarterly financial statements and audited annual
financial statements to the Liquidity Provider, and such other information
as the Liquidity Provider shall reasonably request with respect to the
transactions contemplated by the Operative Agreements, in each case, only
to the extent that Midway is obligated to provide such information pursuant
to Section 8.04 of the Trust Agreement and (ii) Midway agrees to allow the
Liquidity Provider to inspect Midway's books and records regarding such
transactions, and to discuss such transactions with officers and employees
of Midway; and
(viii) Such other documents, instruments, opinions and approvals
pertaining to the transactions contemplated hereby or by the other
Operative Agreements as the Liquidity Provider shall have reasonably
requested.
(b) The following statement shall be true on and as of the
Effective Date: No event has occurred and is continuing, or would result from
the entering into of this Agreement or the making of any Advance, which
constitutes a Liquidity Event of Default.
(c) The Liquidity Provider shall have received payment in full of
all fees and other sums required to be paid to or for the account of the
Liquidity Provider on or prior to the Effective Date.
(d) All conditions precedent to the issuance of the Certificates
under the Trust Agreements shall have been satisfied or waived, all conditions
precedent to the effectiveness of the other Liquidity Facilities shall have been
satisfied or waived, and all conditions precedent to the purchase of the
Certificates by the Placement Agents under the Placement Agreement shall have
been satisfied (unless any of such conditions precedent shall have been waived
by the Placement Agents).
(e) The Borrower shall have received on or before the Closing Date
each of the following:
(i) The Guarantee Agreement, substantially in the form of Exhibit I
hereto, duly executed on behalf of each of the parties thereto;
(ii) A certificate, dated the date hereof, signed by a duly
authorized representative of the Liquidity Provider, certifying that all
conditions precedent to the effectiveness of Section 2.01 have been
satisfied or waived.
Section 4.02. Conditions Precedent to Borrowing. The obligation of
---------------------------------
the Liquidity Provider to make an Advance on the occasion of each Borrowing
shall be subject to the
22
conditions precedent that the Effective Date shall have occurred and, prior to
the date of such Borrowing, the Borrower shall have delivered a Notice of
Borrowing which conforms to the terms and conditions of this Agreement and has
been completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants of the Borrower. So long as any
-------------------------------------
Advance shall remain unpaid or the Liquidity Provider shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity Provider hereunder, the Borrower will, unless the Liquidity
Provider shall otherwise consent in writing:
(a) Performance of This and Other Agreements. Punctually pay or
----------------------------------------
cause to be paid all amounts payable by it under this Agreement and the
other Operative Agreements and observe and perform in all material respects
the conditions, covenants and requirements applicable to it contained in
this Agreement and the other Operative Agreements.
(b) Reporting Requirements. Furnish to the Liquidity Provider with
----------------------
reasonable promptness, such other information and data with respect to the
transactions contemplated by the Operative Agreements as from time to time
may be reasonably requested by the Liquidity Provider; and permit the
Liquidity Provider, upon reasonable notice, to inspect the Borrower's books
and records with respect to such transactions and to meet with officers and
employees of the Borrower to discuss such transactions.
(c) Certain Operative Agreements. Furnish to the Liquidity Provider
----------------------------
with reasonable promptness such Operative Agreements entered into after the
date hereof as from time to time may be reasonably requested by the
Liquidity Provider.
Section 5.02. Negative Covenants of the Borrower. So long as any
----------------------------------
Advance shall remain unpaid or the Liquidity Provider shall have any Maximum
Commitment hereunder or the Borrower shall have any obligation to pay any amount
to the Liquidity Provider hereunder, the Borrower will not appoint or permit or
suffer to be appointed any successor Borrower without the prior written consent
of the Liquidity Provider, which consent shall not be unreasonably withheld or
delayed.
23
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. Liquidity Events of Default. If (a) any Liquidity
---------------------------
Event of Default has occurred and is continuing and (b) there is a Performing
Note Deficiency, the Liquidity Provider may, in its discretion, deliver to the
Borrower a Termination Notice, the effect of which shall be to cause (i) this
Agreement to expire on the fifth Business Day after the date on which such
Termination Notice is received by the Borrower, (ii) the Borrower to promptly
request, and the Liquidity Provider to promptly make, a Final Advance in
accordance with Section 2.02(d) hereof and Section 3.6(i) of the Intercreditor
Agreement, (iii) all other outstanding Advances to be automatically converted
into Final Advances for purposes of determining the Applicable Liquidity Rate
for interest payable thereon, and (iv) subject to Sections 2.07 and 2.09 hereof,
all Advances (including, without limitation, any Provider Advance and Applied
Provider Advance), any accrued interest thereon and any other amounts
outstanding hereunder to become immediately due and payable to the Liquidity
Provider.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Amendments, Etc., No amendment or waiver of any
----------------
provision of this Agreement, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Liquidity Provider, and, in the case of an amendment or of a
waiver by the Borrower, the Borrower, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
Section 7.02. Notices, Etc. Except as otherwise expressly provided
------------
herein, all notices and other communications provided for hereunder shall be in
writing (including telecopier and mailed or delivered or sent by telecopier):
Borrower: ALLFIRST BANK
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Liquidity
Provider: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL SERVICES INC.
24
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
or, as to each of the foregoing, at such other address as shall be designated by
such Person in a written notice to the others. All such notices and
communications shall be effective (i) if given by telecopier, when transmitted
to the telecopier number specified above, (ii) if given by mail, when deposited
in the mails addressed as specified above, and (iii) if given by other means,
when delivered at the address specified above, except that written notices to
the Liquidity Provider pursuant to the provisions of Articles II and III hereof
shall not be effective until received by the Liquidity Provider. A copy of all
notices delivered hereunder to either party shall in addition be delivered to
each of the parties to the Participation Agreements at their respective
addresses set forth therein.
Section 7.03. No Waiver: Remedies. No failure on the part of the
-------------------
Liquidity Provider to exercise, and no delay in exercising, any right under this
Agreement shall operate as a waiver thereof; nor shall any single or partial
exercise of any right under this Agreement preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 7.04. Further Assurances. The Borrower agrees to do such
------------------
further acts and things and to execute and deliver to the Liquidity Provider
such additional assignments, agreements, powers and instruments as the Liquidity
Provider may reasonably require or deem advisable to carry into effect the
purposes of this Agreement and the other Operative Agreements or to better
assure and confirm unto the Liquidity Provider its rights, powers and remedies
hereunder and under the other Operative Agreements.
Section 7.05. Indemnification; Survival of Certain Provisions. The
-----------------------------------------------
Liquidity Provider shall be indemnified hereunder to the extent and in the
manner described in Section 7.01 of the Participation Agreements and Section 6
of the Note Purchase Agreement. In addition, the Borrower agrees to indemnify,
protect, defend and hold harmless the Liquidity Provider from, against and in
respect of, and shall pay on demand, all Expenses of any kind or nature
whatsoever (other than any Expenses of the nature described in Sections 3.01,
3.02 or 7.07 hereof or in the MSCS Fee Letter (regardless of whether indemnified
against pursuant to said Sections or in such MSCS Fee Letter)), that may be
imposed, incurred by or asserted against any Liquidity Indemnitee, in any way
relating to, resulting from, or arising out of or in connection with any action,
suit or proceeding by any third party against such Liquidity Indemnitee and
relating to this Agreement, the MSCS Fee Letter, the Intercreditor Agreement or
any Financing Agreement; provided, however, that the Borrower shall not be
-------- -------
required to indemnify, protect,
25
defend and hold harmless any Liquidity Indemnitee in respect of any Expense of
such Liquidity Indemnitee (i) to the extent such Expense is attributable to the
gross negligence or willful misconduct of such Liquidity Indemnitee or any other
Liquidity Indemnitee, (ii) ordinary and usual operating overhead expense, or
(iii) attributable to the failure by such Liquidity Indemnitee or any other
Liquidity Indemnitee to perform or observe any agreement, covenant or condition
on its part to be performed or observed in this Agreement, the Intercreditor
Agreement, the MSCS Fee Letter or any other Operative Agreement to which it is a
party. The indemnities contained in Section 7.01 of the Participation
Agreements, and the provisions of Sections 3.01, 3.02, 3.03, 3.09, 7.05 and 7.07
hereof, shall survive the termination of this Agreement.
Section 7.06. Liability of the Liquidity Provider. (a) Neither the
-----------------------------------
Liquidity Provider nor any of its officers, employees, directors or affiliates
shall be liable or responsible for: (i) the use which may be made of the
Advances or any acts or omissions of the Borrower or any beneficiary or
transferee in connection therewith; (ii) the validity, sufficiency or
genuineness of documents, or of any endorsement thereon, even if such documents
should prove to be in any or all respects invalid, insufficient, fraudulent or
forged; or (iii) the making of Advances by the Liquidity Provider against
delivery of a Notice of Borrowing and other documents which do not comply with
the terms hereof; provided, however, that the Borrower shall have a claim
-------- -------
against the Liquidity Provider, and the Liquidity Provider shall be liable to
the Borrower, to the extent of any damages suffered by the Borrower which were
the result of (A) the Liquidity Provider's willful misconduct or negligence in
determining whether documents presented hereunder comply with the terms hereof,
or (B) any breach by the Liquidity Provider of any of the terms of this
Agreement, including, but not limited to, the Liquidity Provider's failure to
make lawful payment hereunder after the delivery to it by the Borrower of a
Notice of Borrowing strictly complying with the terms and conditions hereof.
(b) Neither the Liquidity Provider nor any of its officers,
employees, director or affiliates shall be liable or responsible in any respect
for (i) any error, omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in connection with this
Agreement or any Notice of Borrowing delivered hereunder, or (ii) any action,
inaction or omission which may be taken by it in good faith, absent willful
misconduct or negligence (in which event the extent of the Liquidity Provider's
potential liability to the Borrower shall be limited as set forth in the
immediately preceding paragraph), in connection with this Agreement or any
Notice of Borrowing.
Section 7.07. Costs, Expenses and Taxes. Subject to Section 2.09,
-------------------------
the Borrower agrees to pay, or cause to be paid (A) on the Effective Date and on
such later date or dates on which the Liquidity Provider shall make demand, all
reasonable out-of-pocket costs and expenses (including, without limitation, the
reasonable fees and expenses of outside counsel for the Liquidity Provider) of
the Liquidity Provider in connection with the preparation, negotiation,
execution, delivery, filing and recording of this Agreement, any other Operative
Agreement and
26
any other documents which may be delivered in connection with this Agreement and
(B) on demand, all reasonable costs and expenses (including reasonable counsel
fees and expenses) of the Liquidity Provider in connection with (i) the
enforcement of this Agreement or any other Operative Agreement, (ii) the
modification or amendment of, or supplement to, this Agreement or any other
Operative Agreement or such other documents which may be delivered in connection
herewith or therewith (whether or not the same shall become effective) or (iii)
any action or proceeding relating to any order, injunction, or other process or
decree restraining or seeking to restrain the Liquidity Provider from paying any
amount under this Agreement, the Intercreditor Agreement or any other Operative
Agreement or otherwise affecting the application of funds in the Class B Cash
Collateral Account. In addition, the Borrower shall pay any and all recording,
stamp and other similar taxes and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of this Agreement,
any other Operative Agreement and such other documents, and agrees to save the
Liquidity Provider harmless from and against any and all liabilities with
respect to or resulting from any delay in paying or omission to pay such taxes
or fees.
Section 7.08. Binding Effect; Participations.
------------------------------
(a) This Agreement shall be binding upon and inure to the benefit of
the Borrower and the Liquidity Provider and their respective successors and
assigns, except that neither the Liquidity Provider (except as otherwise
provided in this Section 7.08) nor (except as contemplated by Section 3.08) the
Borrower shall have the right to assign its rights or obligations hereunder or
any interest herein without the prior written consent of the other party,
subject to the requirements of Section 7.08(b). The Liquidity Provider may grant
participations herein or in any of its rights hereunder (including, without
limitation, funded participations and participations in rights to receive
interest payments hereunder) and under the other Operative Agreements to such
Persons as (not including Midway or any affiliate of Midway) the Liquidity
Provider may in its sole discretion select, subject to the requirements of
Section 7.08(b). No such participation by the Liquidity Provider, however, will
relieve the Liquidity Provider of its obligations hereunder. In connection with
any participation or any proposed participation, the Liquidity Provider may
disclose to the participant or the proposed participant any information that the
Borrower is required to deliver or to disclose to the Liquidity Provider
pursuant to this Agreement. The Borrower acknowledges and agrees that the
Liquidity Provider's source of funds may derive in part from its participants.
Accordingly, references in this Agreement and the other Operative Agreements to
determinations, reserve and capital adequacy requirements, increased costs,
reduced receipts, additional amounts due pursuant to Section 3.03(a) and the
like as they pertain to the Liquidity Provider shall be deemed also to include
those of each of its participants (subject, in each case, where such participant
is not (i) a bank organized under the laws of the United States or any State
thereof and (ii) a member of the Federal Reserve System with deposits exceeding
$1,000,000,000 (a bank described in (i) and (ii) above being a "Reference
Bank"), to
27
the maximum amount that would have been incurred by or attributable to a
Reference Bank directly if such Reference Bank, rather than the participant, had
held the interest participated).
(b) If, pursuant to subsection (a) above, the Liquidity Provider
sells any participation in this Agreement to any bank or other entity (each, a
"Transferee"), then, concurrently with the effectiveness of such participation,
----------
the Transferee shall (i) represent to the Liquidity Provider (for the benefit of
the Liquidity Provider and the Borrower) either (A) that it is incorporated
under the laws of the United States or a state thereof or (B) that under
applicable law and treaties, no taxes will be required to be withheld with
respect to any payments to be made to such Transferee in respect of this
Agreement, (ii) furnish to the Liquidity Provider and the Borrower either (x) a
statement that it is incorporated under the laws of the United States or a state
thereof or (y) if it is not so incorporated, two copies of a properly completed
United States Internal Revenue Service Form W-8 ECI or Form W-8 BEN, as
appropriate, or other applicable form, certificate or document prescribed by the
Internal Revenue Service certifying, in each case, such Transferee's entitlement
to a complete exemption from United States federal withholding tax in respect to
any and all payments to be made hereunder, and (iii) agree (for the benefit of
the Liquidity Provider and the Borrower) to provide the Liquidity Provider and
the Borrower a new Form W-8 ECI or Form W-8 BEN, as appropriate, (A) on or
before the date that any such form expires or becomes obsolete or (B) after the
occurrence of any event requiring a change in the most recent form previously
delivered by it and prior to the immediately following due date of any payment
by the Borrower hereunder, certifying in the case of a Form W-8 BEN or Form W-8
ECI that such Transferee is entitled to a complete exemption from United States
federal withholding tax on payments under this Agreement. Unless the Borrower
has received forms or other documents reasonably satisfactory to it (and
required by applicable law) indicating that payments hereunder are not subject
to United States federal withholding tax, the Borrower will withhold taxes as
required by law from such payments at the applicable statutory rate.
Section 7.09. Severability. Any provision of this Agreement which is
------------
prohibited, unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or nonauthorization without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of such
provision in any other jurisdiction.
Section 7.10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
-------------
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial;
-------------------------------------------------
Waiver of Immunity. (a) Each of the parties hereto hereby irrevocably and
------------------
unconditionally:
28
(i) submits for itself and its property in any legal action or proceeding
relating to this Agreement or any other Operative Agreement, or for
recognition and enforcement of any judgment in respect hereof or
thereof, to the nonexclusive general jurisdiction of the courts of
the State of New York, the courts of the United States of America for
the Southern District of New York, and the appellate courts from any
thereof;
(ii) consents that any such action or proceeding may be brought in such
courts, and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(iii) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form and mail), postage prepaid, to
each party hereto at its address set forth in Section 7.02 hereof, or
at such other address of which the Liquidity Provider shall have been
notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the
right to ▇▇▇ in any other jurisdiction.
(b) THE BORROWER AND THE LIQUIDITY PROVIDER EACH HEREBY AGREE TO
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS
BEING ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. The
Borrower and the Liquidity Provider each warrant and represent that it has
reviewed this waiver with its legal counsel, and that it knowingly and
voluntarily waives its jury trial rights following consultation with such legal
counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
Section 7.12. Execution in Counterparts. This Agreement may be
-------------------------
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
29
Section 7.13. Entirety. This Agreement, the Intercreditor Agreement
--------
and the other Operative Agreements to which the Liquidity Provider is a party
constitute the entire agreement of the parties hereto with respect to the
subject matter hereof and supersedes all prior understandings and agreements of
such parties.
Section 7.14. Headings. Section headings in this Agreement are
--------
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES.
--------------------------------------- --------
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OBLIGATIONS OF THE
LIQUIDITY PROVIDER TO MAKE ADVANCES HEREUNDER, AND THE BORROWER'S RIGHTS TO
DELIVER NOTICES OF BORROWING REQUESTING THE MAKING OF ADVANCES HEREUNDER, SHALL
BE UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR PERFORMED, IN EACH CASE
STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first set forth above.
ALLFIRST BANK, not in its individual
capacity but solely as Subordination
Agent, as agent and trustee for the
Class B Trust, as Borrower
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL
SERVICES INC.,
as Liquidity Provider
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Annex I to
Revolving Credit Agreement
INTEREST ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "Borrower"), hereby certifies to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services
--------
Inc. (the "Liquidity Provider"), with reference to the Revolving Credit
------------------
Agreement (2000-1B) dated as of September 27, 2000, between the Borrower and the
Liquidity Provider (the "Liquidity Agreement"; the terms defined therein and not
-------------------
otherwise defined herein being used herein as therein defined or referenced),
that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of an Interest Advance by the Liquidity Provider to be used, subject
to clause (3)(v) below, for the payment of the interest on the Class B
Certificates which was payable on ________________, ______ (the
"Distribution Date") in accordance with the terms and provisions of the
-----------------
Class B Trust Agreement and the Class B Certificates which Advance is
requested to be made on ________________, ______.
(3) The amount of the Interest Advance requested hereby (i) is $
_______, to be applied in respect of the payment of the interest which was
due and payable on the Class B Certificates on the Distribution Date, (ii)
does not include any amount with respect to the payment of principal of, or
premium on, the Class A Certificates, the Class B Certificates or the Class
C Certificates, or interest on the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions of the
Class B Certificates, the Class B Trust Agreement and the Intercreditor
Agreement (a copy of which computation is attached hereto as Schedule I),
(iv) does not exceed the Maximum Commitment on the date hereof, (v) does
not include any amount of interest which was due and payable on the Class B
Certificates on such Distribution Date but which remains unpaid due to the
failure of the Depositary to pay any amount pursuant to the Deposit
Agreement on such Distribution Date and (vi) has not been and is not the
subject of a prior or contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will apply the same in accordance with
the terms of Section 3.6(b) of the Intercreditor Agreement, (b) no portion
of such amount shall be applied by the Borrower for any other purpose and
(c) no portion of such amount until so applied shall be commingled with
other funds held by the Borrower.
I-2
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, the making of the Interest Advance as requested by this Notice of
Borrowing shall automatically reduce, subject to reinstatement in accordance
with the terms of the Liquidity Agreement, the Maximum Commitment by an amount
equal to the amount of the Interest Advance requested to be made hereby as set
forth in clause (i) of paragraph (3) of this Certificate and such reduction
shall automatically result in corresponding reductions in the amounts available
to be borrowed pursuant to a subsequent Advance.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the __ day of ________________, _____.
ALLFIRST BANK, not in its individual
capacity but solely as Subordination
Agent, as Borrower
By: __________________________________
Name:
Title:
SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with Interest Advance Notice of
Borrowing]
Annex II to
Revolving Credit Agreement
NON-EXTENSION ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
subordination agent (the "Borrower"), hereby certifies to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital
----------
Services Inc. (the "Liquidity Provider"), with reference to the Revolving Credit
--------- ----------
Agreement (2000-1B) dated as of September 27, 2000, between the Borrower and the
Liquidity Provider (the "Liquidity Agreement"; the terms defined therein and not
-------------------
otherwise defined herein being used herein as therein defined or referenced),
that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Non-Extension Advance by the Liquidity Provider to be used
for the funding of the Class B Cash Collateral Account in accordance with
Section 3.6(d) of the Intercreditor Agreement, which Advance is requested
to be made on __________, ____.
(3) The amount of the Non-Extension Advance requested hereby (i) is
$________. ____, which equals the Maximum Commitment on the date hereof and
is to be applied in respect of the funding of the Class B Cash Collateral
Account in accordance with Section 3.6(d) of the Intercreditor Agreement,
(ii) does not include any amount with respect to the payment of the
principal of, or premium on, the Class B Certificates, or principal of, or
interest or premium on, the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions of the
Class B Certificates, the Class B Trust Agreement and the Intercreditor
Agreement (a copy of which computation is attached hereto as Schedule I),
and (iv) has not been and is not the subject of a prior or contemporaneous
Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class B
Cash Collateral Account and apply the same in accordance with the terms of
Section 3.6(d) of the Intercreditor Agreement, (b) no portion of such
amount shall be applied by the Borrower for any other purpose and (c) no
portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Non-Extension Advance as requested by this
Notice of Borrowing shall
II-2
automatically and irrevocably terminate the obligation of the Liquidity Provider
to make further Advances under the Liquidity Agreement; and (B) following the
making by the Liquidity Provider of the Non-Extension Advance requested by this
Notice of Borrowing, the Borrower shall not be entitled to request any further
Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ___ day of _________________, ____.
ALLFIRST BANK, not in its individual
capacity but solely as Subordination
Agent, as Borrower
By: __________________________________
Name:
Title:
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with
Non-Extension Advance Notice of Borrowing]
Annex III to
Revolving Credit Agreement
DOWNGRADE ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
subordination agent (the "Borrower"), hereby certifies to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital
--------
Services Inc. (the "Liquidity Provider"), with reference to the Revolving Credit
--------- --------
Agreement (2000-1B) dated as of September 27, 2000, between the Borrower and the
Liquidity Provider (the "Liquidity Agreement"; the terms defined therein and not
-------------------
otherwise defined herein being used herein as therein defined or referenced),
that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Downgrade Advance by the Liquidity Provider to be used for
the funding of the Class B Cash Collateral Account in accordance with
Section 3.6(c) of the Intercreditor Agreement by reason of (i) the
downgrading of the short-term unsecured debt rating of the Guarantor issued
by any Rating Agency below the Threshold Rating or (ii) the occurrence of a
Guarantee Event, which Advance is requested to be made on __________, ____.
(3) The amount of the Downgrade Advance requested hereby (i) is
$________. ____, which equals the Maximum Commitment on the date hereof and
is to be applied in respect of the funding of the Class B Cash Collateral
Account in accordance with Section 3.6(c) of the Intercreditor Agreement,
(ii) does not include any amount with respect to the payment of the
principal of, or premium on, the Class B Certificates, or principal of, or
interest or premium on, the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions of the
Class B Certificates, the Class B Trust Agreement and the Intercreditor
Agreement (a copy of which computation is attached hereto as Schedule I),
and (iv) has not been and is not the subject of a prior or contemporaneous
Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class B
Cash Collateral Account and apply the same in accordance with the terms of
Section 3.6(c) of the Intercreditor Agreement, (b) no portion of such
amount shall be applied by the Borrower for any other purpose and (c) no
portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
III-2
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Non-Extension Advance as requested by this
Notice of Borrowing shall automatically and irrevocably terminate the obligation
of the Liquidity Provider to make further Advances under the Liquidity
Agreement; and (B) following the making by the Liquidity Provider of the Non-
Extension Advance requested by this Notice of Borrowing, the Borrower shall not
be entitled to request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ___ day of _________________,____.
ALLFIRST BANK, not in its individual capacity
but solely as Subordination Agent, as Borrower
By: _______________________________
Name:
Title:
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with
Non-Extension Advance Notice of Borrowing]
Annex IV to
Revolving Credit Agreement
FINAL ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "Borrower"), hereby certifies to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services
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Inc. (the "Liquidity Provider"), with reference to the Revolving Credit
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Agreement (2000-1C) dated as of September 27, 2000, between the Borrower and the
Liquidity Provider (the "Liquidity Agreement"; the terms defined therein and not
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otherwise defined herein being used herein as therein defined or referenced),
that:
(1) The Borrower is the Subordination Agent under the Intercreditor
Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Final Advance by the Liquidity Provider to be used for the
funding of the Class C Cash Collateral Account in accordance with Section
3.6(i) of the Intercreditor Agreement by reason of the receipt by the
Borrower of a Termination Notice from the Liquidity Provider with respect
to the Liquidity Agreement, which Advance is requested to be made on
(3) The amount of the Final Advance requested hereby (i) is
$__________.__, which equals the Maximum Commitment on the date hereof and
is to be applied in respect of the funding of the Class C Cash Collateral
Account in accordance with Section 3.6(i) of the Intercreditor Agreement,
(ii) does not include any amount with respect to the payment of principal
of, or premium on, the Class C Certificates, or principal of, or interest
or premium on, the Class A Certificates or the Class B Certificates, (iii)
was computed in accordance with the provisions of the Class C Certificates,
the Class C Trust Agreement and the Intercreditor Agreement (a copy of
which computation is attached hereto as Schedule I), and (iv) has not been
and is not the subject of a prior or contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the Class C
Cash Collateral Account and apply the same in accordance with the terms of
Section 3.6(i) of the Intercreditor Agreement, (b) no portion of such
amount shall be applied by the Borrower for any other purpose and (c) no
portion of such amount until so applied shall be commingled with other
funds held by the Borrower.
IV-2
(5) The Borrower hereby requests that the Advance requested hereby be
a Base Rate Advance [and that such Base Rate Advance be converted into a
LIBOR Advance on the third Business Day following your receipt of this
notice]/1/.
The Borrower hereby acknowledges that, pursuant to the Liquidity
Agreement, (A) the making of the Final Advance as requested by this Notice of
Borrowing shall automatically and irrevocably terminate the obligation of the
Liquidity Provider to make further Advances under the Liquidity Agreement; and
(B) following the making by the Liquidity Provider of the Final Advance
requested by this Notice of Borrowing, the Borrower shall not be entitled to
request any further Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered this
Notice of Borrowing as of the ___ day of ______________, ____.
ALLFIRST BANK, not in its individual capacity
but solely as Subordination Agent, as Borrower
By:_________________________________
Name:
Title:
__________________
/1/ Bracketed language may be included at Borrower's option.
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with
Final Advance Notice of Borrowing]
Annex V to
Revolving Credit Agreement
NOTICE OF TERMINATION
[Date]
Allfirst Bank
as Subordination Agent, as Borrower
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Re: Revolving Credit Agreement dated as of September 27, 2000, between Allfirst
Bank, as Subordination Agent, as agent and trustee for the Midway Airlines
Pass Through Trust, 2000-1C, as Borrower, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital
Services Inc. (the "Liquidity Agreement")
Ladies and Gentlemen:
You are hereby notified that pursuant to Section 6.01 of the Liquidity
Agreement, by reason of the occurrence of a Liquidity Event of Default and the
existence of a Performing Note Deficiency (each as defined therein), we are
giving this notice to you in order to cause (i) our obligations to make Advances
(as defined therein) under such Liquidity Agreement to terminate on the fifth
Business Day after the date on which you receive this notice and (ii) you to
request a Final Advance under the Liquidity Agreement pursuant to Section 3.6(i)
of the Intercreditor Agreement (as defined in the Liquidity Agreement) as a
consequence of your receipt of this notice.
V-2
THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER THE
LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE LIQUIDITY
AGREEMENT WILL TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE ON WHICH YOU
RECEIVE THIS NOTICE.
Very truly yours,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services Inc.,
as Liquidity Provider
By:________________________________
Name:
Title:
cc: Allfirst Bank as Class C Trustee
Annex VI to
Revolving Credit Agreement
NOTICE OF REPLACEMENT SUBORDINATION AGENT
[Date]
Attention:
Re: Revolving Credit Agreement dated as of September 27, 2000, between Allfirst
Bank, as Subordination Agent, as agent and trustee for the Midway Airlines
Pass Through Trust, 2000-1C, as Borrower, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital
Services Inc. (the "Liquidity Agreement")
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby irrevocably
transfers to:
________________________________
[Name of Transferee]
_________________________________
[Address of Transferee]
all rights and obligations of the undersigned as Borrower under the Liquidity
Agreement referred to above. The transferee has succeeded the undersigned as
Subordination Agent under the Intercreditor Agreement referred to in the first
paragraph of the Liquidity Agreement, pursuant to the terms of Section 8.1 of
the Intercreditor Agreement.
By this transfer, all rights of the undersigned as Borrower under the
Liquidity Agreement are transferred to the transferee and the transferee shall
hereafter have the sole rights and obligations as Borrower thereunder. The
undersigned shall pay any costs and expenses of such transfer, including, but
not limited to, transfer taxes or governmental charges.
VI-2
We ask that this transfer be effective as of _______________, ____.
ALLFIRST BANK, not in its individual
capacity but solely as Subordination
Agent, as Borrower
By ______________________________
Name:
Title:
Exhibit I to
Revolving Credit Agreement
FORM OF GUARANTEE AGREEMENT
Midway Airlines Pass Through Trust 2000-1C
Ladies and Gentlemen:
In consideration of the Revolving Credit Agreement (the "Agreement")
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dated as of September 27, 2000 between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services Inc., a
Delaware corporation (hereinafter "MSCS") and Allfirst Bank, as Subordination
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Agent, as agent and trustee for the Midway Airlines Pass Through Trust 2000-1C
("Counterparty"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ & Co., a Delaware Corporation
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(hereinafter "MSDW"), hereby irrevocably and unconditionally guarantees to
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Counterparty, with effect from the date of the Agreement, the due and punctual
payment of all amounts payable by MSCS under the Agreement when the same shall
become due and payable, whether on scheduled payment dates, upon demand, upon
declaration of termination or otherwise, in accordance with the terms of the
Agreement and giving effect to any applicable grace period. Upon failure of
MSCS punctually to pay any such amounts, and upon written demand by Counterparty
to MSDW at its address set forth in the signature block of this Guarantee (or to
such other address as MSDW may specify in writing), MSDW agrees to pay or cause
to be paid such amounts; provided that delay by Counterparty in giving such
demand shall in no event affect MSDW's obligations under this Guarantee.
MSDW hereby agrees that its obligations hereunder shall be
unconditional and will not be discharged except by complete payment of the
amounts payable under the Agreement, irrespective of any claim as to the
Agreement's validity, regularity or enforceability or the lack of authority of
MSCS to execute or deliver the Agreement, or any change in or amendment to the
Agreement, or any waiver or consent by Counterparty with respect to any
provisions thereof, or the absence of any action to enforce the Agreement or the
recovery of any judgment against MSCS or of any action to enforce a judgment
against MSCS under the Agreement; or any similar circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor
generally. MSDW hereby waives diligence, presentment, demand on MSCS for
payment or otherwise (except as provided hereinabove), filing of claims
requirement of a prior proceeding against MSCS and protest or notice except as
provided for in the Agreement with respect to amounts payable by MSCS. If at
any time payment under the Agreement is rescinded or must be otherwise restored
or returned by Counterparty upon the insolvency, bankruptcy or reorganization of
MSCS or MSDW or otherwise, MSDW's obligations hereunder with respect to such
payment shall be reinstated upon such restoration or return being made by
Counterpart.
I-2
MSDW represents to Counterparty as of the date hereof, which
representations will be deemed to be repeated by MSDW on each date on which a
Transaction is entered into, that:
(1) it is duly organized and validly existing under the laws of the
jurisdiction of its incorporation and has full power and legal right to execute
and deliver this Guarantee and to perform the provisions of this Guarantee on
its part to be performed;
(2) its execution, delivery and performance of this Guarantee have
been and remain duly authorized by all necessary corporate action and do not
contravene any provision of its certificate of incorporation or by-laws or any
law, regulation or contractual restriction binding on it or its assets;
(3) all consents, authorizations, approvals and clearances
(including, without limitation, any necessary exchange control approval) and
notifications, reports and registrations requisite for its due execution,
delivery and performance of this Guarantee have been obtained from or, as the
case may be, filed with the relevant governmental authorities having
jurisdiction and remain in full force and effect and all conditions thereof have
been duly complied with and no other action by, and no notice to or filing with,
any governmental authority having jurisdiction is required for such execution,
delivery or performance; and
(4) this Guarantee is its legal, valid and binding obligation
enforceable against it in accordance with its terms except as enforcement hereof
may be limited by applicable bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights or by general equity
principles.
By accepting this Guarantee and entering into the Agreement,
Counterparty agrees that MSDW shall be subrogated to all rights of Counterparty
against MSCS in respect of any amounts paid by MSDW pursuant to this Guarantee,
provided that MSDW shall be entitled to enforce or to receive any payment
arising out of or based upon such right of subrogation only to the extent that
it has paid all amounts payable by MSCS under the Agreement.
I-3
This Guarantee shall be governed by and construed in accordance with
the laws of the State of New York. All capitalized terms not otherwise defined
herein shall have the respective meanings assigned to them in the Agreement.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ & CO.
By:____________________________________
Name:
Title:
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇/▇▇/ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Swap Group
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
