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EXHIBIT 4.9
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INTERCREDITOR AGREEMENT
(1999-1)
Dated as of
September 21, 1999
AMONG
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Trustee under the
America West Airlines Pass Through Trust ▇▇▇▇-▇▇
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ Through Trust 1999-1C
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL SERVICES, INC.
as Class G Liquidity Provider
and
as Class C Liquidity Provider
AMBAC ASSURANCE CORPORATION
as Policy Provider
AND
WILMINGTON TRUST COMPANY,
not in its individual capacity except
as expressly set forth herein but
solely as Subordination Agent and Trustee
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS...................................................................... 2
SECTION 1.1. DEFINITIONS................................................................ 2
ARTICLE II TRUST ACCOUNTS; CONTROLLING PARTY............................................... 23
SECTION 2.1. AGREEMENT TO TERMS OF SUBORDINATION; PAYMENTS FROM MONIES RECEIVED ONLY.... 23
SECTION 2.2. TRUST ACCOUNTS............................................................. 24
SECTION 2.3. DEPOSITS TO THE COLLECTION ACCOUNT AND SPECIAL PAYMENTS ACCOUNT............ 25
SECTION 2.4. DISTRIBUTIONS OF SPECIAL PAYMENTS.......................................... 25
SECTION 2.5. DESIGNATED REPRESENTATIVES................................................. 28
SECTION 2.6. CONTROLLING PARTY.......................................................... 29
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED...................... 31
SECTION 3.1. WRITTEN NOTICE OF DISTRIBUTION............................................. 31
SECTION 3.2. DISTRIBUTION OF AMOUNTS ON DEPOSIT IN THE COLLECTION ACCOUNT............... 33
SECTION 3.3. DISTRIBUTION OF AMOUNTS ON DEPOSIT FOLLOWING A TRIGGERING EVENT............ 34
SECTION 3.4. OTHER PAYMENTS............................................................. 37
SECTION 3.5. PAYMENTS TO THE TRUSTEES, LIQUIDITY PROVIDERS AND POLICY PROVIDER.......... 37
SECTION 3.6. LIQUIDITY FACILITIES....................................................... 37
SECTION 3.7. THE POLICY................................................................. 44
ARTICLE IV EXERCISE OF REMEDIES............................................................ 48
SECTION 4.1. DIRECTIONS FROM THE CONTROLLING PARTY...................................... 48
SECTION 4.2. REMEDIES CUMULATIVE........................................................ 49
SECTION 4.3. DISCONTINUANCE OF PROCEEDINGS.............................................. 49
SECTION 4.4. RIGHT OF CERTIFICATEHOLDERS TO RECEIVE PAYMENTS NOT TO BE IMPAIRED......... 49
SECTION 4.5. UNDERTAKING FOR COSTS...................................................... 49
ARTICLE V DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC................... 50
SECTION 5.1. NOTICE OF INDENTURE DEFAULT OR TRIGGERING EVENT............................ 50
SECTION 5.2. INDEMNIFICATION............................................................ 50
SECTION 5.3. NO DUTIES EXCEPT AS SPECIFIED IN INTERCREDITOR AGREEMENT................... 51
SECTION 5.4. NOTICE FROM THE LIQUIDITY PROVIDERS AND TRUSTEES........................... 51
ARTICLE VI THE SUBORDINATION AGENT......................................................... 51
SECTION 6.1. AUTHORIZATION; ACCEPTANCE OF TRUSTS AND DUTIES............................. 51
SECTION 6.2. ABSENCE OF DUTIES.......................................................... 51
SECTION 6.3. NO REPRESENTATIONS OR WARRANTIES AS TO DOCUMENTS........................... 52
SECTION 6.4. NO SEGREGATION OF MONIES; NO INTEREST...................................... 52
SECTION 6.5. RELIANCE; AGENTS; ADVICE OF COUNSEL........................................ 52
SECTION 6.6. CAPACITY IN WHICH ACTING................................................... 53
SECTION 6.7. COMPENSATION............................................................... 53
SECTION 6.8. MAY BECOME CERTIFICATEHOLDER............................................... 53
SECTION 6.9. SUBORDINATION AGENT REQUIRED; ELIGIBILITY.................................. 53
SECTION 6.10. MONEY TO BE HELD IN TRUST................................................. 53
ARTICLE VII INDEMNIFICATION OF SUBORDINATION AGENT......................................... 54
SECTION 7.1. SCOPE OF INDEMNIFICATION................................................... 54
ARTICLE VIII SUCCESSOR SUBORDINATION AGENT................................................. 54
SECTION 8.1. REPLACEMENT OF SUBORDINATION AGENT; APPOINTMENT OF SUCCESSOR............... 54
ARTICLE IX SUPPLEMENTS AND AMENDMENTS...................................................... 55
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Page
SECTION 9.1. AMENDMENTS, WAIVERS, ETC................................................... 55
SECTION 9.2. SUBORDINATION AGENT PROTECTED.............................................. 57
SECTION 9.3. EFFECT OF SUPPLEMENTAL AGREEMENTS.......................................... 57
SECTION 9.4. NOTICE TO RATING AGENCIES.................................................. 57
ARTICLE X MISCELLANEOUS.................................................................... 58
SECTION 10.1. TERMINATION OF INTERCREDITOR AGREEMENT.................................... 58
SECTION 10.2. INTERCREDITOR AGREEMENT FOR BENEFIT OF TRUSTEES, LIQUIDITY PROVIDERS,
THE POLICY PROVIDER AND SUBORDINATION AGENT ............................ 58
SECTION 10.3. NOTICES................................................................... 58
SECTION 10.4. SEVERABILITY.............................................................. 60
SECTION 10.5. NO ORAL MODIFICATIONS OR CONTINUING WAIVERS............................... 60
SECTION 10.6. SUCCESSORS AND ASSIGNS.................................................... 60
SECTION 10.7. HEADINGS.................................................................. 60
SECTION 10.8. COUNTERPART FORM.......................................................... 60
SECTION 10.9. SUBORDINATION............................................................. 60
SECTION 10.10. GOVERNING LAW............................................................ 62
SECTION 10.11. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; WAIVER OF IMMUNITY..... 62
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INTERCREDITOR AGREEMENT
INTERCREDITOR AGREEMENT dated as of September 21, 1999, among
WILMINGTON TRUST COMPANY, a Delaware banking corporation ("WTC"), not in its
individual capacity but solely as Trustee of each Trust (each as defined below);
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL SERVICES, INC., a Delaware corporation ("MSCS"), as Class
G Liquidity Provider and Class C Liquidity Provider; AMBAC ASSURANCE
CORPORATION, a Wisconsin domiciled stock-insurance company as Policy Provider;
and WILMINGTON TRUST COMPANY, not in its individual capacity except as expressly
set forth herein, but solely as Subordination Agent and trustee hereunder (in
such capacity, together with any successor appointed pursuant to Article VIII
hereof, the "Subordination Agent").
WHEREAS, all capitalized terms used herein shall have the
respective meanings referred to in Article I hereof;
WHEREAS, pursuant to each Indenture (i) in the case of each
Aircraft that is owned by America West at the time such Indenture is entered
into (the "Owned Aircraft"), America West will issue on a recourse basis two (or
three, under certain circumstances) series of Equipment Notes to finance the
purchase of such Aircraft, and (ii) in the case of each Aircraft that is leased
to America West pursuant to a related Lease at the time such Indenture is
entered into (the "Leased Aircraft"), the related Owner Trustee will issue on a
nonrecourse basis two (or three, under certain circumstances) series of
Equipment Notes to finance the purchase of such Aircraft;
WHEREAS, pursuant to the Financing Agreements, each Trust will
acquire Equipment Notes having an interest rate equal to the interest rate
applicable to the Certificates to be issued by such Trust;
WHEREAS, pursuant to each Trust Agreement, the Trust created
thereby proposes to issue a single class of Certificates (a "Class") bearing the
interest rate and having the final distribution date described in such Trust
Agreement on the terms and subject to the conditions set forth therein;
WHEREAS, pursuant to the Purchase Agreement, the Initial
Purchasers propose to purchase the Certificates issued by each Trust in the
aggregate face amount set forth opposite the name of such Trust on Schedule I
thereto on the terms and subject to the conditions set forth therein;
WHEREAS, the Liquidity Provider proposes to enter into two
separate revolving credit agreements (each such agreement, a "Liquidity
Facility") with the Subordination Agent, as agent for the Trustee of each Trust,
respectively, for the benefit of the Certificateholders of such Trust;
WHEREAS, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ & Co. (the "Guarantor")
will guarantee in full, pursuant to separate Guarantee Agreements dated as of
the date hereof (each, a "Guarantee Agreement"), the obligations of MSCS under
the Liquidity Facilities;
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WHEREAS, the Policy Provider proposes to enter into the Policy
Provider Agreement providing for the issuance by the Policy Provider of the
Policy for the benefit of the Class G Trustee and Class G Certificateholders;
and
WHEREAS, it is a condition precedent to the obligations of the
Initial Purchasers under the Purchase Agreement that the Subordination Agent,
the Trustees, the Liquidity Provider and the Policy Provider agree to the terms
of subordination set forth in this Agreement in respect of each Class of
Certificates, and the Subordination Agent, the Trustees, the Liquidity Provider
and the Policy Provider, by entering into this Agreement, hereby acknowledge and
agree to such terms of subordination and the other provisions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. For all purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(1) the terms used herein that are defined in this Article
have the meanings assigned to them in this Article, and include the
plural as well as the singular;
(2) all references in this Agreement to designated "Articles",
"Sections" and other subdivisions are to the designated Articles,
Sections and other subdivisions of this Agreement;
(3) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to
any particular Article, Section or other subdivision; and
(4) the term "including" shall mean "including without
limitation".
"Acceleration" means, with respect to the amounts payable in
respect of the Equipment Notes issued under any Indenture, such amounts becoming
immediately due and payable by declaration or otherwise. "Accelerate",
"Accelerated" and "Accelerating" have meanings correlative to the foregoing.
"Accrued Class G Interest" has the meaning specified in
Section 3.7(a).
"Adjusted Expected Distributions" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates (excluding interest, if any,
payable with respect to the Deposits related to such Trust) and (y) the greater
of:
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(A) the difference between (x) the Pool Balance of such
Certificates as of the immediately preceding Distribution Date (or, if
the Current Distribution Date is the first Distribution Date, the
original aggregate face amount of the Certificates of such Trust) and
(y) the Pool Balance of such Certificates as of the Current
Distribution Date calculated on the basis that (i) the principal of the
Non-Performing Equipment Notes held in such Trust has been paid in full
and such payments have been distributed to the holders of such
Certificates, (ii) the principal of the Performing Equipment Notes held
in such Trust has been paid when due (but without giving effect to any
Acceleration of Performing Equipment Notes) and such payments have been
distributed to the holders of such Certificates and (iii) the principal
of any Equipment Notes formerly held in such Trust that have been sold
pursuant to the terms hereof has been paid in full and such payments
have been distributed to the holders of such Certificates, but without
giving effect to any reduction in the Pool Balance as a result of any
distribution attributable to Deposits occurring after the immediately
preceding Distribution Date (or, if the Current Distribution Date is
the first Distribution Date, occurring after the initial issuance of
the Certificates of such Trust), and
(B) the amount of the excess, if any, of (i) the Pool Balance
of such Class of Certificates as of the immediately preceding
Distribution Date (or, if the Current Distribution Date is the first
Distribution Date, the original aggregate face amount of the
Certificates of such Trust), less the amount of the Deposits for such
Class of Certificates as of such preceding Distribution Date (or, if
the Current Distribution Date is the first Distribution Date, the
original aggregate amount of the Deposits for such Class of
Certificates) other than any portion of such Deposits thereafter used
to acquire Equipment Notes pursuant to the Note Purchase Agreement,
over (ii) the Aggregate LTV Collateral Amount for such Class of
Certificates for the Current Distribution Date;
provided that, until the date of the initial LTV Appraisals, clause (B) shall
not apply.
For purposes of calculating Adjusted Expected Distributions
with respect to the Certificates of any Trust, any premium paid on the Equipment
Notes held in such Trust that has not been distributed to the Certificateholders
of such Trust (other than such premium or a portion thereof applied to the
payment of interest on the Certificates of such Trust or the reduction of the
Pool Balance of such Trust) shall be added to the amount of Adjusted Expected
Distributions.
"Advance", with respect to any Liquidity Facility, means any
Advances as defined in such Liquidity Facility.
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by or under common control
with such Person. For the purposes of this definition, "control" means the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether through the ownership of voting
securities or by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Aggregate LTV Collateral Amount" for any Class of
Certificates for any Distribution Date means the sum of the applicable LTV
Collateral Amounts for each Leased
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Aircraft and Owned Aircraft, minus the Pool Balance for each Class of
Certificates, if any, senior to such Class, after giving effect to any
distribution of principal on such Distribution Date with respect to such senior
Class or Classes.
"Aircraft" means, with respect to each Indenture, the
"Aircraft" referred to therein.
"America West" means America West Airlines, Inc., a Delaware
corporation, and its successors and assigns.
"America West Bankruptcy Event" means the occurrence and
continuation of any of the following:
(a) America West shall consent to the appointment of or the
taking of possession by a receiver, trustee or liquidator of itself or
of substantially all of its property, or America West shall admit in
writing its inability to pay its debts generally as they come due, or
shall make a general assignment for the benefit of creditors, or
America West shall file a voluntary petition in bankruptcy or a
voluntary petition or an answer seeking reorganization, liquidation or
other relief in a case under any bankruptcy laws or other insolvency
laws (as in effect at such time) or an answer admitting the material
allegations of a petition filed against America West in any such case,
or America West shall seek relief by voluntary petition, answer or
consent, under the provisions of any other bankruptcy or other similar
law providing for the reorganization or winding-up of corporations (as
in effect at such time) or America West shall seek an agreement,
composition, extension or adjustment with its creditors under such
laws, or America West's board of directors shall adopt a resolution
authorizing corporate action in furtherance of any of the foregoing; or
(b) an order, judgment or decree shall be entered by any court
of competent jurisdiction appointing, without the consent of America
West, a receiver, trustee or liquidator of America West or of
substantially all of its property, or substantially all of the property
of America West shall be sequestered, or granting any other relief in
respect of America West as a debtor under any bankruptcy laws or other
insolvency laws (as in effect at such time), and any such order,
judgment or decree of appointment or sequestration shall remain in
force undismissed, unstayed and unvacated for a period of 90 days after
the date of entry thereof; or
(c) a petition against America West in a case under any
bankruptcy laws or other insolvency laws (as in effect at such time) is
filed and not withdrawn or dismissed within 90 days thereafter, or if,
under the provisions of any law providing for reorganization or
winding-up of corporations which may apply to America West, any court
of competent jurisdiction assumes jurisdiction, custody or control of
America West or of any substantial part of its property and such
jurisdiction, custody or control remains in force unrelinquished,
unstayed and unterminated for a period of 90 days.
"America West Provisions" has the meaning specified in Section
9.1(a).
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"Appraisal" means a fair market value appraisal (which may be
a "desktop" appraisal) performed by any Appraiser or any other nationally
recognized aircraft appraiser on the basis of an arm's-length transaction
between an informed and willing purchaser under no compulsion to buy and an
informed and willing seller under no compulsion to sell and both having
knowledge of all relevant facts.
"Appraised Current Market Value" of any Leased Aircraft or
Owned Aircraft means the lower of the average and the median of the three most
recent Appraisals of such Aircraft.
"Appraisers" means AVITAS, Inc., AvSolutions, Inc., and ▇▇▇▇▇▇
▇▇▇▇▇ and ▇▇▇▇▇, Inc.
"Assignment and Assumption Agreements" means each of the
Assignment and Assumption Agreements to be executed among a Trustee and trustee
of the relevant Successor Trust in accordance with the relevant Trust Agreement,
as the same may be amended, modified or supplemented from time to time.
"Available Amount" means, with respect to any Liquidity
Facility on any drawing date, an amount equal to (a) the Stated Amount of such
Liquidity Facility at such time, less (b) the aggregate amount of each Interest
Drawing honored by the Liquidity Provider under such Liquidity Facility on or
prior to such date which has not been reimbursed or reinstated as provided in
Section 3.6(g) hereof as of such date; provided that, following a Downgrade
Drawing, a Non-Extension Drawing or a Final Drawing under such Liquidity
Facility, the Available Amount of such Liquidity Facility shall be zero.
"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
Phoenix, Arizona, New York, New York, or, so long as any Certificate is
outstanding, the city and state in which any Trustee, the Subordination Agent or
any Loan Trustee maintains its Corporate Trust Office or receives and disburses
funds, and that, solely with respect to draws under any Liquidity Facility, also
is a "Business Day" as defined in such Liquidity Facility.
"Cash Collateral Account" means the Class G Cash Collateral
Account or the Class C Cash Collateral Account, as applicable.
"Certificate" means a Class G Certificate or a Class C
Certificate, as applicable.
"Certificateholder" means any holder of one or more
Certificates.
"Class" has the meaning assigned to such term in the
preliminary statements to this Agreement.
"Class C Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify, into
which all amounts drawn under the Class C Liquidity Facility pursuant to Section
3.6(c), 3.6(d) or 3.6(i) shall be deposited.
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"Class C Certificateholder" means, at any time, any holder of
one or more Class C Certificates.
"Class C Certificates" means the certificates issued by the
Class C Trust, substantially in the form of Exhibit A to the Class C Trust
Agreement, and authenticated by the Class C Trustee, representing fractional
undivided interests in the Class C Trust, and any certificates issued in
exchange therefor or replacement thereof pursuant to the terms of the Class C
Trust Agreement and/or the Registration Rights Agreement (including, without
limitation, any Exchange Certificates (as defined in the Class C Trust
Agreement).
"Class C Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination Agent,
as agent and trustee for the Class C Trustee, and the initial Class C Liquidity
Provider, and, from and after the replacement of such Agreement pursuant hereto,
the Replacement Liquidity Facility therefor, if any, in each case as amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Class C Liquidity Provider" means MSCS, together with any
Replacement Liquidity Provider which has issued a Replacement Liquidity Facility
to replace any Class C Liquidity Facility pursuant to Section 3.6(e).
"Class C Trust" means (i) prior to the Transfer, the America
West Airlines Pass Through Trust 1999-1C-O created and administered pursuant to
the Class C Trust Agreement and (ii) after the Transfer, the America West
Airlines Pass Through Trust 1999-1C-S created and administered pursuant to the
Class C Trust Agreement.
"Class C Trust Agreement" means (i) prior to the Transfer, the
Pass Through Trust Agreement, dated as of the date hereof, between America West
and the Class C Trustee, governing the creation and administration of the
America West Airlines Pass Through Trust 1999-1C-O and the issuance of the Class
C Certificates, as the same may be amended, supplemented or otherwise modified
from time to time in accordance with its terms, and (ii) after the Transfer, the
Pass Through Trust Agreement entered into between America West and the Class C
Trustee, governing the creation and administration of the America West Airlines
Pass Through Trust 1999-1C-S and the issuance of the Class C Certificates, as
the same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
"Class C Trustee" means WTC, not in its individual capacity
except as expressly set forth in the Class C Trust Agreement, but solely as
trustee under the Class C Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"Class D Certificates" means any pass through certificates
issued by the Class D Trust representing fractional undivided interests in the
Class D Trust.
"Class D Trust" means the America West Airlines Pass Through
Trust 1999-1D, if and when established.
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"Class G Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify, into
which all amounts drawn under the Class G Liquidity Facility pursuant to Section
3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class G Certificateholder" means, at any time, any holder of
one or more Class G Certificates.
"Class G Certificates" means the certificates issued by the
Class G Trust, substantially in the form of Exhibit A to the Class G Trust
Agreement, and authenticated by the Class G Trustee, representing fractional
undivided interests in the Class G Trust, and any certificates issued in
exchange therefor or replacement thereof pursuant to the terms of the Class G
Trust Agreement and/or the Registration Rights Agreement (including, without
limitation, any Exchange Certificates (as defined in the Class G Trust
Agreement).
"Class G Deposits" means the Deposits with respect to the
Class G Certificates.
"Class G Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination Agent,
as agent and trustee for the Class G Trustee, and the initial Class G Liquidity
Provider, and, from and after the replacement of such Agreement pursuant hereto,
the Replacement Liquidity Facility therefor, if any, in each case as amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Class G Liquidity Provider" means MSCS, together with any
Replacement Liquidity Provider which has issued a Replacement Liquidity Facility
to replace any Class G Liquidity Facility pursuant to Section 3.6(e).
"Class G Paying Agent Account" means the Paying Agent Account
as defined in the Escrow and Paying Agent Agreement relating to the Class G
Certificates.
"Class G Trust" means (i) prior to the Transfer, the America
West Airlines Pass Through Trust 1999-1G-O created and administered pursuant to
the Class G Trust Agreement and (ii) after the Transfer, the America West
Airlines Pass Through Trust 1999-1G-S created and administered pursuant to the
Class G Trust Agreement.
"Class G Trust Agreement" means (i) prior to the Transfer, the
Pass Through Trust Agreement, dated as of the date hereof, between America West
and the Class G Trustee, governing the creation and administration of the
America West Airlines Pass Through Trust 1999-1G-O and the issuance of the Class
G Certificates, as the same may be amended, supplemented or otherwise modified
from time to time in accordance with its terms, and (ii) after the Transfer, the
Pass Through Trust Agreement entered into between America West and the Class G
Trustee, governing the creation and administration of the America West Airlines
Pass Through Trust 1999-1G-S and the issuance of the Class G Certificates, as
the same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
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"Class G Trustee" means WTC, not in its individual capacity
except as expressly set forth in the Class G Trust Agreement, but solely as
trustee under the Class G Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"Closing Date" means September 21, 1999.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, and the Treasury Regulations promulgated thereunder.
"Collateral" has the meaning assigned to such term in the
Owned Aircraft Indentures.
"Collection Account" means the Eligible Deposit Account
established by the Subordination Agent pursuant to Section 2.2 which the
Subordination Agent shall make deposits in and withdrawals from in accordance
with this Agreement.
"Controlling Party" means the Person entitled to act as such
pursuant to the terms of Section 2.6.
"Corporate Trust Office" means, with respect to any Trustee,
the Subordination Agent or any Loan Trustee, the office of such Person in the
city at which, at any particular time, its corporate trust business shall be
principally administered.
"Current Distribution Date" means a Distribution Date
specified as a reference date for calculating the Expected Distributions or the
Adjusted Expected Distributions with respect to the Certificates of any Trust as
of such Distribution Date.
"Delivery Period Expiry Date" means the earlier of (a) May 30,
2000, or, if the Equipment Notes relating to all the New Aircraft (or Substitute
Aircraft in lieu thereof) have not been purchased by the Trusts on or prior to
such date due to any reason beyond the control of America West and not
occasioned by America West's fault or negligence, August 31, 2000 and (b) the
date on which Equipment Notes with respect to all New Aircraft (or Substitute
Aircraft in lieu thereof) have been purchased by the Trusts in accordance with
the Note Purchase Agreement.
"Deposit Agreement" shall mean, with respect to any Class, the
Deposit Agreement pertaining to such Class dated as of the date hereof between
the Escrow Agent, and the Depositary, as the same may be amended, modified or
supplemented from time to time in accordance with the terms thereof.
"Depositary" means ABN AMRO Bank N.V., acting through its
Chicago Branch, as depositary under each Deposit Agreement, or its successors
and assigns.
"Deposits" with respect to any Class, shall have the meaning
set forth in the Deposit Agreement pertaining to such Class.
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"Designated Representatives" means the Subordination Agent
Representatives, the Trustee Representatives and the Provider Representatives
identified under Section 2.5.
"Distribution Date" means a Regular Distribution Date or a
Special Distribution Date.
"Dollars" or "$" means United States dollars.
"Downgrade Drawing" has the meaning assigned to such term in
Section 3.6(c).
"Downgraded Facility" has the meaning assigned to such term in
Section 3.6(c).
"Drawing" means an Interest Drawing, a Final Drawing, a
Non-Extension Drawing or a Downgrade Drawing, as the case may be.
"EBO Date" shall mean the date set forth on Schedule 1 to the
Lease as the "EBO Date".
"Election Distribution Date" has the meaning assigned to such
term in Section 3.7(c).
"Eligible Deposit Account" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the United States of America or any one of the states thereof or the District
of Columbia (or any U.S. branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as any
of the securities of such depository institution has a long-term unsecured debt
rating from each Rating Agency of at least A2 or its equivalent. An Eligible
Deposit Account may be maintained with a Liquidity Provider so long as such
Liquidity Provider is an Eligible Institution; provided that such Liquidity
Provider shall have waived all rights of set-off and counterclaim with respect
to such account.
"Eligible Institution" means (a) the corporate trust
department of the Subordination Agent or any Trustee, as applicable, or (b) a
depository institution organized under the laws of the United States of America
or any one of the states thereof or the District of Columbia (or any U.S. branch
of a foreign bank), which has a long-term unsecured debt rating from each Rating
Agency of at least A2 or its equivalent.
"Eligible Investments" means (a) investments in obligations
of, or guaranteed by, the United States Government having maturities no later
than 90 days following the date of such investment, (b) investments in open
market commercial paper of any corporation incorporated under the laws of the
United States of America or any state thereof with a short-term unsecured debt
rating issued by Moody's and Standard & Poor's of at least P-1 and A-1,
respectively, having maturities no later than 90 days following the date of such
investment or (c) investments in negotiable certificates of deposit, time
deposits, banker's acceptances, commercial paper or other direct obligations of,
or obligations guaranteed by, commercial banks organized under the laws of the
United States or of any political subdivision thereof (or any U.S. branch of a
foreign
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bank) with short-term unsecured debt ratings of at least A-1 by Moody's and P-1
by Standard & Poor's, having maturities no later than 90 days following the date
of such investment; provided, however, that (x) all Eligible Investments that
are bank obligations shall be denominated in U.S. dollars; and (y) the aggregate
amount of Eligible Investments at any one time that are bank obligations issued
by any one bank shall not be in excess of 5% of such bank's capital surplus;
provided further that (1) any investment of the types described in clauses (a),
(b) and (c) above may be made through a repurchase agreement in commercially
reasonable form with a bank or other financial institution qualifying as an
Eligible Institution so long as such investment is held by a third party
custodian also qualifying as an Eligible Institution, and (2) all such
investments set forth in clause (a), (b) or (c) above mature no later than the
Business Day immediately preceding the next Regular Distribution Date; provided
further, however, that in the case of any Eligible Investment issued by a
domestic branch of a foreign bank, the income from such investment shall be from
sources within the United States for purposes of the Code. Notwithstanding the
foregoing, no investment of the types described in clause (b) above which is
issued or guaranteed by America West or any of its Affiliates, and no investment
in the obligations of any one bank in excess of $10,000,000, shall be an
Eligible Investment unless written approval has been obtained from the Policy
Provider and a Ratings Confirmation shall have been received with respect to the
making of such investment.
"Equipment Notes" means, at any time, the Series G Equipment
Notes and the Series C Equipment Notes, collectively, and in each case, any
Equipment Notes issued in exchange therefor or replacement thereof pursuant to
the terms of the Indentures.
"Escrow Agent" means WTC, as escrow agent under each Escrow
and Paying Agent Agreement, together with its successors in such capacity.
"Escrow and Paying Agent Agreement" shall mean, with respect
to any Class, the Escrow and Paying Agent Agreement pertaining to such Class
dated as of the date hereof between the Escrow Agent, the Initial Purchasers,
the Trustee for such Class and the Paying Agent, as the same may be amended,
modified or supplemented from time to time in accordance with the terms thereof.
"Excess Interest Policy Drawing" has the meaning assigned to
such term in Section 3.7(c).
"Excess Reimbursement Obligations" means, (a) in the event of
any Policy Provider Election, the portion of the Policy Provider Obligations
that represents, when added to that portion of any Liquidity Obligations that
represents, interest on the Series G Equipment Note in respect of which the
Policy Provider Election has been made in excess of 24 months of interest at the
interest rate applicable to such Equipment Note and (b) any interest on the
Liquidity Obligations in respect of the Class G Liquidity Facility and Class C
Liquidity Facility paid by the Policy Provider to the Liquidity Provider from
and after the end of the 24-month period referred to in Section 3.7(c) hereof.
"Expected Distributions" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates (excluding interest, if any,
payable with respect to the Deposits related to such Trust) and (y) the
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difference between (A) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (or, if the Current Distribution Date is
the first Distribution Date, the original aggregate face amount of the
Certificates of such Trust), and (B) the Pool Balance of such Certificates as of
the Current Distribution Date calculated on the basis that (i) the principal of
the Equipment Notes held in such Trust has been paid when due (whether at stated
maturity, upon redemption, prepayment, purchase, Acceleration or otherwise) and
such payments have been distributed to the holders of such Certificates and (ii)
the principal of any Equipment Notes formerly held in such Trust that have been
sold pursuant to the terms hereof has been paid in full and such payments have
been distributed to the holders of such Certificates, but without giving effect
to any reduction in the Pool Balance as a result of any distribution
attributable to Deposits occurring after the immediately preceding Distribution
Date (or, if the Current Distribution Date is the first Distribution Date,
occurring after the initial issuance of the Certificates of such Trust). For
purposes of calculating Expected Distributions with respect to the Certificates
of any Trust, any premium paid on the Equipment Notes held in such Trust which
has not been distributed to the Certificateholders of such Trust (other than
such premium or a portion thereof applied to the payment of interest on the
Certificates of such Trust or the reduction of the Pool Balance of such Trust)
shall be added to the amount of such Expected Distributions.
"Expiry Date" with respect to any Liquidity Facility, shall
have the meaning set forth in such Liquidity Facility.
"Fee Letter" means the Fee Letter dated as of the date hereof
among America West, MSCS and the Subordination Agent with respect to the initial
Liquidity Facilities and any fee letter entered into among America West, the
Subordination Agent and any Replacement Liquidity Provider.
"Final Distributions" means, with respect to the Certificates
of any Trust on any Distribution Date, the sum of (x) the aggregate amount of
all accrued and unpaid interest on such Certificates (excluding interest, if
any, payable with respect to the Deposits relating to such Trust) and (y) the
Pool Balance of such Certificates as of the immediately preceding Distribution
Date (less the amount of the Deposits for such Class of Certificates as of such
preceding Distribution Date other than any portion of such Deposits thereafter
used to acquire Equipment Notes pursuant to the Note Purchase Agreement). For
purposes of calculating Final Distributions with respect to the Certificates of
any Trust, any premium paid on the Equipment Notes held in such Trust which has
not been distributed to the Certificateholders of such Trust (other than such
premium or a portion thereof applied to the payment of interest on the
Certificates of such Trust or the reduction of the Pool Balance of such Trust)
shall be added to the amount of such Final Distributions.
"Final Drawing" has the meaning assigned to such term in
Section 3.6(i).
"Final Legal Distribution Date" means (i) with respect to the
Class G Certificates, July 2, 2020 and (ii) with respect to the Class C
Certificates, July 2, 2007.
"Financing Agreement" means each of the Participation
Agreements and the Note Purchase Agreement.
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"Guarantee Agreement" has the meaning assigned to such term in
the preliminary statements to this Agreement.
"Guarantee Event" has the meaning assigned to such term in
Section 3.6(c).
"Guarantor" has the meaning assigned to such term in the
preliminary statements to this Agreement.
"Indenture" means each of the Trust Indentures entered into by
the Loan Trustee, and the Owner Trustee or America West, pursuant to the Note
Purchase Agreement, in each case as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms.
"Indenture Default" means, with respect to any Indenture, any
Event of Default (as such term is defined in such Indenture) thereunder.
"Initial Purchasers" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated,
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation and
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
"Interest Drawing" has the meaning assigned to such term in
Section 3.6(a).
"Interest Payment Date" means, with respect to any Liquidity
Facility, the final day of each Interest Period thereunder.
"Interest Period" with respect to any Liquidity Facility, has
the meaning assigned to such term in such Liquidity Facility.
"Investment Earnings" means investment earnings on funds on
deposit in the Trust Accounts net of losses and investment expenses of the
Subordination Agent in making such investments.
"Lease" means, with respect to each Indenture pertaining to a
Leased Aircraft, the "Lease" referred to therein.
"Leased Aircraft" has the meaning assigned to such term in the
preliminary statements of this Agreement.
"Leased Aircraft Indenture" means, with respect to each Leased
Aircraft, the Indenture pertaining thereto.
"Lending Office" means, with respect to any Liquidity
Facility, the office of the Liquidity Provider thereunder, presently located at
New York, New York or such other office as such Liquidity Provider from time to
time shall notify the applicable Trustee as its "Lending Office" under any such
Liquidity Facility; provided that such 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 of any such Liquidity Facility.
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"Lien" means any mortgage, pledge, lien, charge, claim,
disposition of title, encumbrance, lease, sublease, sub-sublease or security
interest of any kind, including, without limitation, any thereof arising under
any conditional sales or other title retention agreement.
"Liquidity Event of Default" with respect to any Liquidity
Facility, has the meaning assigned to such term in such Liquidity Facility.
"Liquidity Expenses" means all Liquidity Obligations other
than (i) the amount of any Drawings under the Liquidity Facilities and (ii) any
interest accrued on any Liquidity Obligations.
"Liquidity Facilities" means, at any time, the Class G
Liquidity Facility or the Class C Liquidity Facility.
"Liquidity Obligations" means all principal, interest, fees
and other amounts owing to the Liquidity Providers under the Liquidity
Facilities, Section 9.1 of the Participation Agreements or the Fee Letter.
"Liquidity Provider" means, at any time, any Class G Liquidity
Provider or any Class C Liquidity Provider, as applicable.
"Loan Trustee" means, with respect to any Indenture, the
mortgagee thereunder.
"LTV Appraisals" has the meaning assigned to such term in
Section 4.1(a).
"LTV Collateral Amount" of any Leased Aircraft or Owned
Aircraft for any Class of Certificates means, as of any Distribution Date, the
lesser of (i) the LTV Ratio for such Class of Certificates multiplied by the
Appraised Current Market Value of such Aircraft (or with respect to any such
Aircraft which has suffered an Event of Loss under and as defined in the
relevant Lease (in the case of a Leased Aircraft) or Indenture (in the case of
an Owned Aircraft), the amount of the insurance proceeds paid to the related
Loan Trustee in respect thereof to the extent then held by such Loan Trustee
(and/or on deposit in the Special Payments Account) or payable to such Loan
Trustee in respect thereof) and (ii) the outstanding principal amount of the
Equipment Notes secured by such Aircraft after giving effect to any principal
payments of such Equipment Notes on or before such Distribution Date.
"LTV Ratio" means for the Class G Certificates, 57% and for
the Class C Certificates, 62%.
"Material Adverse Tax Event" has the meaning assigned to such
term in Section 17.3(a)(4) of the Lease.
"Minimum Sale Price" means, with respect to any Aircraft or
the Equipment Notes issued in respect of such Aircraft, at any time, the lesser
of (a) 75% of the Appraised Current Market Value of such Aircraft and (b) the
aggregate outstanding principal amount of such Equipment Notes, plus accrued and
unpaid interest thereon.
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"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"New Aircraft" has the meaning ascribed to the term "Aircraft"
in the Note Purchase Agreement.
"Non-Controlling Party" means, at any time, any of the
Trustees, the Liquidity Provider or the Policy Provider which is not the
Controlling Party at such time.
"Non-Extended Facility" has the meaning assigned to such term
in Section 3.6(d).
"Non-Extension Drawing" has the meaning assigned to such term
in Section 3.6(d).
"Non-Performing Equipment Note" means an Equipment Note issued
pursuant to an Indenture that is not a Performing Equipment Note.
"Note Purchase Agreement" means the Note Purchase Agreement
dated as of the date hereof, among America West, each Trustee, the Escrow Agent,
the Subordination Agent and the Paying Agent.
"Notice for Payment" means a Notice of Nonpayment as such term
is defined in the Policy.
"Notice of Avoided Payment" has the meaning assigned to such
term in the Policy.
"Officer's Certificate" of any Person means a certification
signed by a Responsible Officer of such Person.
"Operative Agreements" means this Agreement, the Liquidity
Facilities, the Policy, the Policy Provider Agreement, the Indentures, the Trust
Agreements, the Purchase Agreement, the Financing Agreements, the Leases, the
Fee Letter, the Equipment Notes and the Certificates, together with all exhibits
and schedules included with any of the foregoing.
"Order" has the meaning assigned to such term in the Policy.
"Outstanding" means, when used with respect to each Class of
Certificates, as of the date of determination, all Certificates of such Class
theretofore authenticated and delivered under the related Trust Agreement,
except:
(i) Certificates of such Class theretofore canceled by the
Registrar (as defined in such Trust Agreement) or delivered to the
Trustee thereunder or such Registrar for cancellation;
(ii) Certificates of such Class for which money in the full
amount required to make the final distribution with respect to such
Certificates pursuant to Section 11.01 of such Trust Agreement has been
theretofore deposited with the related Trustee in trust for
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the holders of such Certificates as provided in Section 4.01 of such
Trust Agreement pending distribution of such money to such
Certificateholders pursuant to such final distribution payment; and
(iii) Certificates of such Class in exchange for or in lieu of
which other Certificates have been authenticated and delivered pursuant
to such Trust Agreement;
provided, however, that in determining whether the holders of the requisite
Outstanding amount of such Certificates have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, any Certificates
owned by America West or any of its Affiliates shall be disregarded and deemed
not to be Outstanding, except that, in determining whether such Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Certificates that such Trustee knows to be so
owned shall be so disregarded. Certificates so owned that have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the applicable Trustee the pledgee's right so to act with
respect to such Certificates and that the pledgee is not America West or any of
its Affiliates.
"Overdue Scheduled Payment" means any Scheduled Payment which
is not in fact received by the Subordination Agent within five days after the
Scheduled Payment Date relating thereto.
"Owned Aircraft" has the meaning assigned to such term in the
preliminary statements of this Agreement.
"Owned Aircraft Indenture" means, with respect to each Owned
Aircraft, the Indenture pertaining to such Aircraft.
"Owner Trustee" means, with respect to any Indenture
pertaining to a Leased Aircraft, the Owner Trustee (as defined therein) not in
its individual capacity but solely as trustee under the related owner trust
agreement, together with any successor trustee appointed pursuant to such owner
trust agreement.
"Participation Agreement" means, with respect to each
Indenture, the "Participation Agreement" referred to therein.
"Payee" has the meaning assigned to such term in Section
2.4(e).
"Paying Agent" means WTC, as paying agent under each Escrow
and Paying Agent Agreement, together with its successors in such capacity.
"Performing Equipment Note" means an Equipment Note issued
pursuant to an Indenture with respect to which no payment default has occurred
and is continuing (without giving effect to any Acceleration); provided that in
the event of a bankruptcy proceeding involving America West under Title 11 of
the United States Code (the "Bankruptcy Code"), (i) any payment default existing
during the 60-day period under Section 1110(a)(1)(A) of the Bankruptcy Code (or
such longer period as may apply under Section 1110(b) of the Bankruptcy
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Code) (the "Section 1110 Period") shall not be taken into consideration, unless
during the Section 1110 Period the trustee in such proceeding or America West
refuses to assume or agree to perform its obligations under the Lease related to
such Equipment Note (in the case of a Leased Aircraft) or under the Indenture
related to such Equipment Note (in the case of an Owned Aircraft) and (ii) any
payment default occurring after the date of the order of relief in such
proceeding shall not be taken into consideration if such payment default is
cured under Section 1110(a)(1)(B) of the Bankruptcy Code before the later of 30
days after the date of such default or the expiration of the Section 1110
Period.
"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.
"Person" means any individual, corporation, partnership, joint
venture, association, limited liability company, joint-stock company, trust,
trustee, unincorporated organization or government or any agency or political
subdivision thereof.
"Policy" means the Ambac Certificate Guarantee Insurance
Policy No. AB0292BE, together with the Certificate Guaranty Insurance Policy
Endorsement attached thereto, issued as of the Closing Date, as amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Policy Account" means the Eligible Deposit Account
established by the Subordination Agent pursuant to Section 2.2(a)(iii).
"Policy Drawing" means any payment of a claim under the
Policy.
"Policy Expenses" means all amounts (including amounts in
respect of expenses or indemnities) due to the Policy Provider under the Policy
Provider Agreement or the Financing Agreements other than the amount of any
Policy Drawing and any interest accrued on any Policy Provider Obligations.
"Policy Provider" means Ambac Assurance Corporation.
"Policy Provider Agreement" means the Insurance and Indemnity
Agreement dated as of the date hereof among the Subordination Agent, as agent
and trustee for the Class G Trustee, America West and the Policy Provider as
amended, supplemented or otherwise modified from time to time in accordance with
its terms.
"Policy Provider Default" shall mean the occurrence of any of
the following events (a) the Policy Provider fails to make a payment required
under the Policy in accordance with its terms and such failure remains
unremedied for 2 Business Days following the delivery of Written Notice of such
failure to the Policy Provider or (b) the Policy Provider (i) files any petition
or commences any case or proceeding under any provisions of any federal or state
law relating to insolvency, bankruptcy, rehabilitation, liquidation or
reorganization, (ii) makes a general assignment for the benefit of its creditors
or (iii) has an order for relief entered against it under any federal or state
law relating to insolvency, bankruptcy, rehabilitation, liquidation or
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reorganization that is final and nonappealable, or (c) a court of competent
jurisdiction, the Wisconsin Department of Insurance or another competent
regulatory authority enters a final and nonappealable order, judgment or decree
(i) appointing a custodian, trustee, agent or receiver for the Policy Provider
or for all or any material portion of its property or (ii) authorizing the
taking of possession by a custodian, trustee, agent or receiver of the Policy
Provider (or taking of possession of all or any material portion of the Policy
Provider's property).
"Policy Provider Election" has the meaning assigned to such
term in Section 3.7(c).
"Policy Provider Obligations" means all reimbursement and
other amounts, including, without limitation, fees and indemnities, due to the
Policy Provider under the Policy Provider Agreement but shall not include any
interest on Policy Drawings except, if the Class G Liquidity Provider has failed
to honor any Interest Drawing in accordance with Section 2.02(e) of the Class G
Liquidity Facility, interest on any Policy Drawing made to cover the shortfall
attributable to such failure in an amount equal to the amount of interest that
would have accrued on such Interest Drawing if such Interest Drawing had been
made in accordance with Section 2.02(e) of the Class G Liquidity Facility at the
interest rate applicable to such Interest Drawing until such Policy Drawing has
been repaid in full, up to a maximum of three such Policy Drawings. For the
avoidance of doubt, Policy Provider Obligations include reimbursement of, and
interest on, the Liquidity Obligations in respect of the Class G Liquidity
Facility and the Class C Liquidity Facility paid by the Policy Provider to the
Liquidity Provider.
"Policy Provider Rating" shall mean the respective ratings by
each of the Ratings Agencies of the Policy Provider's financial strength in
respect of the Policy.
"Policy Provider Threshold Rating" shall mean a Policy
Provider Rating of Aaa by Moody's and AAA by Standard & Poor's.
"Pool Balance" means, with respect to each Trust or the
Certificates issued by any Trust, as of any date, (i) the original aggregate
face amount of the Certificates of such Trust less (ii) the aggregate amount of
all payments made in respect of the Certificates of such Trust or in respect of
Deposits relating to such Trust other than payments made in respect of interest
or premium thereon or reimbursement of any costs and expenses in connection
therewith. The Pool Balance for each Trust or for the Certificates issued by any
Trust as of any Distribution Date shall be computed after giving effect to any
special distribution with respect to unused Deposits, payment of principal of
the Equipment Notes, payments under the Policy (other than in respect of
interest on the Certificates) or payment with respect to other Trust Property
held in such Trust and the distribution thereof to be made on that date.
"Preference Amount" has the meaning assigned to such term in
the Policy.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Provider Representatives" has the meaning assigned to such
term in Section 2.5(c).
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"Provider Incumbency Certificate" has the meaning assigned to
such term in Section 2.5(c).
"PTC Event of Default" means, with respect to each Trust
Agreement, the failure to pay within 10 Business Days of the due date thereof:
(i) the outstanding Pool Balance of the applicable Class of Certificates on the
Final Legal Distribution Date for such Class or (ii) interest due on such
Certificates on any Distribution Date (unless the Subordination Agent shall have
made an Interest Drawing, or a withdrawal from the Cash Collateral Account, or a
drawing under the Policy, with respect thereto in an aggregate amount sufficient
to pay such interest and shall have distributed such amount to the Trustee
entitled thereto).
"Purchase Agreement" means the Purchase Agreement dated
September 14, 1999 among the Initial Purchasers and America West, relating to
the purchase of the Certificates by the Initial Purchasers, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
its terms.
"Rating Agencies" means, collectively, at any time, each
nationally recognized rating agency which shall have been requested to rate the
Certificates and which shall then be rating the Certificates. The initial Rating
Agencies will be Moody's and Standard & Poor's.
"Ratings Confirmation" means, with respect to any action
proposed to be taken, a written confirmation from each of the Rating Agencies
that such action would not result in (i) a reduction of the rating for any Class
of Certificates below the then current rating for such Class of Certificates
(without regard to the Policy in respect of the Class G Certificates) or (ii) a
withdrawal or suspension of the rating of any Class of Certificates.
"Registration Rights Agreement" means the Exchange and
Registration Rights Agreement dated as of the date hereof, among the Initial
Purchasers, the Trustees and America West, as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Regular Distribution Dates" means each January 2 and July 2,
commencing on January 2, 2000; provided, however, that, if any such day shall
not be a Business Day, the related distribution shall be made on the next
succeeding Business Day without additional interest.
"Replacement Liquidity Facility" means, for any Liquidity
Facility, an irrevocable revolving credit agreement (or agreements) in
substantially the form of the replaced Liquidity Facility, including
reinstatement provisions, or in such other form (which may include a letter of
credit) as shall permit the Rating Agencies to confirm in writing their
respective ratings then in effect for the related Certificates (before
downgrading of such ratings, if any, as a result of (i) the downgrading of the
applicable Liquidity Provider or, if applicable, any guarantor of its
obligations or (ii) any guarantee of such Liquidity Provider's obligations
ceasing to be in full force and effect or becoming invalid or unenforceable or
such guarantor denying its liability thereunder, but, in each case, without
regard to the Policy) and, in the case of the Class G Liquidity Facility only,
be consented to by the Policy Provider, which consent shall not be unreasonably
withheld or delayed, in a face amount (or in an aggregate face amount) equal to
the
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amount of interest payable on the Certificates of such Trust (at the Stated
Interest Rate for such Trust, and without regard to expected future principal
payments) on the three Regular Distribution Dates following the date of
replacement of such Liquidity Facility and issued by a Person (or Persons)
having unsecured short-term debt ratings issued by both Rating Agencies which
are equal to or higher than the Threshold Rating. Without limitation of the form
that a Replacement Liquidity Facility otherwise may have pursuant to the
preceding sentence, a Replacement Liquidity Facility for any Class of
Certificates may have a stated expiration date earlier than 15 days after the
Final Legal Distribution Date of such Class of Certificates so long as such
Replacement Liquidity Facility provides for a Non-Extension Drawing as
contemplated by Section 3.6(d) hereof.
"Replacement Liquidity Provider" means a Person (or Persons)
who issues a Replacement Liquidity Facility.
"Required Amount" means, with respect to each Liquidity
Facility, or the Cash Collateral Account, for any Class, 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 related Class of Certificates, that would be
payable on such Class of Certificates on each of the three successive Regular
Distribution Dates immediately following such day or, if such day is a Regular
Distribution Date, on such day and the succeeding two Regular Distribution
Dates, in each case calculated on the basis of the Pool Balance of such Class of
Certificates on such date and without regard to expected future payments of
principal on such Class of Certificates. The Pool Balance for purposes of the
definition of Required Amount with respect to the Class G Liquidity Facility
shall, in the event of any Policy Provider Election, be deemed to be reduced by
the amount (if positive) by which (a) the then outstanding principal balance of
each Series G Equipment Note in respect of which such Policy Provider Election
has been made shall exceed (b) the amount of any Policy Drawings previously paid
by the Policy Provider in respect of principal on such Series G Equipment Note.
"Responsible Officer" means (i) with respect to the
Subordination Agent and each of the Trustees, any officer in the corporate trust
administration department of the Subordination Agent or such Trustee or any
other officer customarily performing functions similar to those performed by the
Persons who at the time shall be such officers, respectively, or to whom any
corporate trust matter is referred because of his knowledge of and familiarity
with a particular subject, (ii) with respect to each Liquidity Provider, any
authorized officer of such Liquidity Provider, and (iii) with respect to the
Policy Provider, any authorized officer of the Policy Provider.
"Scheduled Payment" means, with respect to any Equipment Note,
(i) any payment of principal or interest on such Equipment Note (other than an
Overdue Scheduled Payment) due from the obligor thereon or (ii) any payment of
interest on the corresponding Class of Certificates with funds drawn under any
Liquidity Facility or the Policy, which payment represents the installment of
principal at the stated maturity of such installment of principal on such
Equipment Note, the payment of regularly scheduled interest accrued on the
unpaid principal amount of such Equipment Note, or both; provided that any
payment of principal of, premium, if any, or interest resulting from the
redemption or purchase of any Equipment Note shall not constitute a Scheduled
Payment.
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"Scheduled Payment Date" means, with respect to any Scheduled
Payment, the date on which such Scheduled Payment is scheduled to be made.
"Section 2.4(b) Fraction" has the meaning assigned to such
term in Section 2.4(b).
"Series G Equipment Notes" means the 7.93% Series G Equipment
Notes issued pursuant to any Indenture by the related Owner Trustee or America
West, as the case may be, and authenticated by the Loan Trustee thereunder, and
any such Equipment Notes issued in exchange therefor or replacement thereof
pursuant to the terms of such Indenture.
"Series C Equipment Notes" means the 8.54% Series C Equipment
Notes issued pursuant to any Indenture by the related Owner Trustee or America
West, as the case may be, and authenticated by the Loan Trustee thereunder, and
any such Equipment Notes issued in exchange therefor or replacement thereof
pursuant to the terms of such Indenture.
"Series D Equipment Notes" means equipment notes, if any,
issued pursuant to any Indenture by the related Owner Trustee or America West,
as the case may be, and authenticated by the Loan Trustee thereunder, and
designated as "Series D" thereunder, and any such equipment notes issued in
exchange therefor or replacement thereof pursuant to the terms of such
Indenture.
"Special Distribution Date" means with respect to any Special
Payment: (i) the date chosen by the Subordination Agent pursuant to Section
2.4(a) for the distribution of such Special Payment in accordance with this
Agreement, whether distributed pursuant to Section 2.4 or Section 3.3 hereof or
(ii) the date chosen by the Subordination Agent pursuant to Section 3.7(c) or
Section 3.7(e), as the case may be, for the distribution of such Special Payment
in accordance with the provisions thereof.
"Special Payment" means any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note or Trust
Indenture Estate or Collateral.
"Special Payments Account" means the Eligible Deposit Account
created pursuant to Section 2.2 as a sub-account to the Collection Account.
"Standard & Poor's" means Standard & Poor's Ratings Services,
a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Stated Amount" with respect to any Liquidity Facility, means
the Maximum Commitment (as defined in such Liquidity Facility) of the applicable
Liquidity Provider thereunder.
"Stated Expiration Date" has the meaning specified in Section
3.6(d).
"Stated Interest Rate" means (i) with respect to the Class G
Certificates, 7.93% per annum, and (ii) with respect to the Class C
Certificates, 8.54% per annum (such rate with respect to each Class of
Certificates, the "Initial Stated Interest Rate" for such Class), plus, in
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each case, solely in the event no Registration Event (as defined in the
Registration Rights Agreement) occurs on or prior to the 210th day after the
Closing Date, an additional margin equal to 0.50% per annum, from and including
such 210th day (provided that any such additional margin shall cease to be in
effect from and including the earlier of (i) the date on which such Registration
Event occurs and (ii) the date on which there ceases to be any Registrable
Certificates (as defined in the Registration Rights Agreement)); provided that
if the Shelf Registration Statement (as defined in the Registration Rights
Agreement) ceases to be effective at any time during the period specified by
Section 2(b)(B) of the Registration Rights Agreement for more than 60 days,
whether or not consecutive, during any 12-month period, the Stated Interest Rate
shall be increased by 0.50% per annum from the 61st day of the applicable
12-month period such Shelf Registration Statement ceases to be effective until
such time as the Shelf Registration Statement again becomes effective (or, if
earlier, the end of the period specified by Section 2(b)(B) of the Registration
Rights Agreement). For the avoidance of doubt, the Stated Interest Rate for any
Class of Certificates shall never exceed 0.50% per annum over the initial Stated
Interest Rate for such Class of Certificates.
"Subordination Agent" has the meaning assigned to it in the
preliminary statements to this Agreement.
"Subordination Agent Incumbency Certificate" has the meaning
assigned to such term in Section 2.5(a).
"Subordination Agent Representatives" has the meaning assigned
to such term in Section 2.5(a).
"Substitute Aircraft" shall have the meaning set forth in the
Note Purchase Agreement.
"Successor Trusts" means, collectively, America West Airlines
Pass Through Trust 1999-1G-S and America West Airlines Pass Through Trust
1999-1C-S.
"Tax" and "Taxes" mean any and all taxes, levies, duties,
tariffs, imposts, and other charges of a similar kind (together with any and all
interest, penalties, loss, damage, liability, expense, additions to tax and
additional amounts or costs incurred or imposed with respect thereto) imposed or
otherwise assessed by the United States of America or by any state, local or
foreign government (or any subdivision or agency thereof) or other taxing
authority, including, without limitation: taxes on or with respect to income,
franchises, windfall or other profits, gross receipts, property, sales, use,
capital stock, payroll, employment, social security, workers' compensation,
unemployment compensation, or net worth; taxes in the nature of excise,
withholding, ad valorem, stamp, transfer, non-recoverable value added, taxes on
goods and services and gains taxes.
"Termination Notice" with respect to any Liquidity Facility
has the meaning assigned to such term in such Liquidity Facility.
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"Threshold Rating" means the short-term unsecured debt rating
of P-1 by ▇▇▇▇▇'▇ and A-1 by Standard & Poor's for each Liquidity Provider (or
the Guarantor, so long as MSCS is the Class G Liquidity Provider or the Class C
Liquidity Provider, as the case may be).
"Transfer" means, with respect to any particular Trust, the
transfers contemplated by the Assignment and Assumption Agreement with respect
to such Trust.
"Treasury Regulations" means regulations, including proposed
or temporary regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Triggering Event" means (x) the occurrence of an Indenture
Default under all of the Indentures resulting in a PTC Event of Default with
respect to the most senior Class of Certificates then Outstanding, (y) the
Acceleration of all of the outstanding Equipment Notes (provided that, with
respect to the period prior to the Delivery Period Expiry Date, the aggregate
principal balance of such Equipment Notes is in excess of $100 million) or (z)
the occurrence of an America West Bankruptcy Event.
"Trust" means either of the Class G Trust or the Class C
Trust.
"Trust Accounts" has the meaning assigned to such term in
Section 2.2(a).
"Trust Agreement" means either of the Class G Trust Agreement
or the Class C Trust Agreement.
"Trust Indenture Estate" has the meaning assigned to such term
in the Leased Aircraft Indentures.
"Trust Property" with respect to any Trust, has the meaning
set forth in the Trust Agreement for such Trust.
"Trustee" means any of the Class G Trustee or the Class C
Trustee.
"Trustee Incumbency Certificate" has the meaning assigned to
such term in Section 2.5(b).
"Trustee Representatives" has the meaning assigned to such
term in Section 2.5(b).
"Unindemnified Tax" means (i) any Tax imposed on the net
income, net worth or capital, any franchise Tax or similar doing business Tax of
the Subordination Agent (other than any such Tax imposed as a result of the
Company's assumption of the Equipment Notes pursuant to the purchase of an
Aircraft on an EBO Date or a Material Adverse Tax Event, and (ii) any
withholding Tax imposed by the United States (including, without limitation, any
withholding Tax imposed by the United States which is imposed or increased as a
result of the Subordination
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Agent's failing to deliver to the Company any certificate or document necessary
to establish that payments under this Agreement are exempt from withholding
Tax).
"Written Notice" means, from the Subordination Agent, any
Trustee, Liquidity Provider or the Policy Provider, a written instrument
executed by the Designated Representative of such Person. An invoice delivered
by a Liquidity Provider pursuant to Section 3.1 in accordance with its normal
invoicing procedures shall constitute Written Notice under such Section.
"WTC" has the meaning assigned to such term in the recital of
parties to this Agreement.
ARTICLE II
TRUST ACCOUNTS; CONTROLLING PARTY
SECTION 2.1. Agreement to Terms of Subordination; Payments
from Monies Received Only. (a) Each Trustee hereby acknowledges and agrees to
the terms of subordination and distribution set forth in this Agreement in
respect of each Class of Certificates and agrees to enforce such provisions and
cause all payments in respect of the Equipment Notes and the Liquidity
Facilities to be applied in accordance with the terms of this Agreement. In
addition, each Trustee hereby agrees to cause the Equipment Notes purchased by
the related Trust to be registered in the name of the Subordination Agent or its
nominee, as agent and trustee for such Trustee, to be held in trust by the
Subordination Agent solely for the purpose of facilitating the enforcement of
the subordination and other provisions of this Agreement.
(b) Except as otherwise expressly provided in the next
succeeding sentence of this Section 2.1, all payments to be made by the
Subordination Agent hereunder shall be made only from amounts received by it
that constitute Scheduled Payments, Special Payments, payments under Section 9.1
of the Participation Agreements or payments under Sections 6 and 7 of the Note
Purchase Agreement, and only to the extent that the Subordination Agent shall
have received sufficient income or proceeds therefrom to enable it to make such
payments in accordance with the terms hereof. Each of the Trustees and the
Subordination Agent hereby agrees and, as provided in each Trust Agreement, each
Certificateholder, by its acceptance of a Certificate, each Liquidity Provider,
by entering into the Liquidity Facility to which it is a party, and the Policy
Provider, by entering into the Policy Provider Agreement, has agreed to look
solely to such amounts to the extent available for distribution to it as
provided in this Agreement and to the relevant Deposits and that none of the
Trustees, Owner Trustees, Loan Trustees, Owner Participants nor the
Subordination Agent or WTC is personally liable to any of them for any amounts
payable or any liability under this Agreement, any Trust Agreement, any
Liquidity Facility, the Policy Provider Agreement or such Certificate, except
(in the case of the Subordination Agent) as expressly provided herein or (in the
case of the Trustees) as expressly provided in each Trust Agreement or (in the
case of the Owner Trustees and the Loan Trustees) as expressly provided in any
Operative Agreement.
SECTION 2.2. Trust Accounts. (a) Upon the execution of this
Agreement, the Subordination Agent shall establish and maintain in its name (i)
the Collection Account as an
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Eligible Deposit Account, bearing a designation clearly indicating that the
funds deposited therein are held in trust for the benefit of the Trustees, the
Certificateholders, the Liquidity Providers and the Policy Provider, (ii) as a
sub-account in the Collection Account, the Special Payments Account as an
Eligible Deposit Account, bearing a designation clearly indicating that the
funds deposited therein are held in trust for the benefit of the Trustees, the
Certificateholders, the Liquidity Providers and the Policy Provider, and (iii)
the Policy Account as an Eligible Deposit Account bearing a designation clearly
indicating that the funds deposited therein are held in trust for the benefit of
the Class G Trustee and the Class G Certificateholders. The Subordination Agent
shall establish and maintain the Cash Collateral Accounts pursuant to and under
the circumstances set forth in Section 3.6(f) hereof. Upon such establishment
and maintenance under Section 3.6(f) hereof, the Cash Collateral Accounts shall,
together with the Collection Account, constitute the "Trust Accounts" hereunder.
(b) Funds on deposit in the Trust Accounts shall be invested
and reinvested by the Subordination Agent in Eligible Investments selected by
the Subordination Agent if such investments are reasonably available and have
maturities no later than the earlier of (i) 90 days following the date of such
investment and (ii) the Business Day immediately preceding the Regular
Distribution Date or the date of the related distribution pursuant to Section
2.4 hereof, as the case may be, next following the date of such investment;
provided, however, that following the making of a Downgrade Drawing or a
Non-Extension Drawing under any Liquidity Facility, the Subordination Agent
shall invest and reinvest such amounts in Eligible Investments at the direction
of America West (or, if and to the extent so specified to the Subordination
Agent by America West with respect to any Liquidity Facility, the Liquidity
Provider with respect to such Liquidity Facility); provided further, however,
that following the making of a Downgrade Drawing or Non-Extension Drawing under
any initial Liquidity Facility, the Subordination Agent shall invest and
reinvest the amounts in the Cash Collateral Account with respect to such
Liquidity Facility in Eligible Investments pursuant to the written instructions
of the Liquidity Provider funding such Drawing; provided further, however, that
upon the occurrence and during the continuation of a Triggering Event, the
Subordination Agent shall invest and reinvest such amounts in accordance with
the written instructions of the Controlling Party. Unless otherwise expressly
provided in this Agreement (including, without limitation, with respect to
Investment Earnings on amounts on deposit in the Cash Collateral Accounts,
Section 3.6(f) hereof), any Investment Earnings shall be deposited in the
Collection Account when received by the Subordination Agent and shall be applied
by the Subordination Agent in the same manner as the other amounts on deposit in
the Collection Account are to be applied and any losses shall be charged against
the principal amount invested, in each case net of the Subordination Agent's
reasonable fees and expenses in making such investments. The Subordination Agent
shall not be liable for any loss resulting from any investment, reinvestment or
liquidation required to be made under this Agreement other than by reason of its
willful misconduct or gross negligence. Eligible Investments and any other
investment required to be made hereunder shall be held to their maturities
except that any such investment may be sold (without regard to its maturity) by
the Subordination Agent without instructions whenever such sale is necessary to
make a distribution required under this Agreement. Uninvested funds held
hereunder shall not earn or accrue interest.
(c) The Subordination Agent shall possess all right, title and
interest in all funds on deposit from time to time in the Trust Accounts and in
all proceeds thereof (including
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all income thereon, except as otherwise expressly provided herein with respect
to Investment Earnings). The Trust Accounts shall be held in trust by the
Subordination Agent under the sole dominion and control of the Subordination
Agent for the benefit of the Trustees, the Certificateholders, the Liquidity
Providers and the Policy Provider, as the case may be. If, at any time, any of
the Trust Accounts ceases to be an Eligible Deposit Account, the Subordination
Agent shall within 10 Business Days (or such longer period, not to exceed 30
calendar days, to which the Policy Provider and each Rating Agency may consent)
establish a new Collection Account, Special Payments Account, Policy Account or
Cash Collateral Account, as the case may be, as an Eligible Deposit Account and
shall transfer any cash and/or any investments to such new Collection Account,
Special Payments Account, Policy Account or Cash Collateral Account, as the case
may be. So long as WTC is an Eligible Institution, the Trust Accounts shall be
maintained with it as Eligible Deposit Accounts.
SECTION 2.3. Deposits to the Collection Account and Special
Payments Account. (a) The Subordination Agent shall, upon receipt thereof,
deposit in the Collection Account all Scheduled Payments received by it (other
than any Scheduled Payment which by the express terms hereof is to be deposited
to the Policy Account or a Cash Collateral Account).
(b) The Subordination Agent shall, on each date when one or
more Special Payments are made to the Subordination Agent as holder of the
Equipment Notes, deposit in the Special Payments Account the aggregate amount of
such Special Payments.
SECTION 2.4. Distributions of Special Payments. (a) Notice of
Special Payment. Except as provided in Section 2.4(e) below, upon receipt by the
Subordination Agent, as registered holder of the Equipment Notes, of any notice
of a Special Payment (or, in the absence of any such notice, upon receipt by the
Subordination Agent of a Special Payment), the Subordination Agent shall
promptly give notice thereof to each Trustee, the Liquidity Providers and the
Policy Provider. The Subordination Agent shall promptly calculate the amount of
the redemption or purchase of Equipment Notes, the amount of any Overdue
Scheduled Payment or the proceeds of Equipment Notes, the Trust Indenture Estate
or Collateral, as the case may be, comprising such Special Payment under the
applicable Indenture or Indentures and shall promptly send to each Trustee a
Written Notice of such amount and the amount allocable to each Trust. Such
Written Notice shall also set the distribution date for such Special Payment (a
"Special Distribution Date"), which shall be the Business Day which immediately
follows the later to occur of (x) the 15th day after the date of such Written
Notice or (y) the date the Subordination Agent has received or expects to
receive such Special Payment. Amounts on deposit in the Special Payments Account
shall be distributed in accordance with Sections 2.4(b) and 2.4(c) hereof, as
applicable.
(b) Redemptions and Purchases of Equipment Notes. (i) So long
as no Triggering Event shall have occurred (whether or not continuing), the
Subordination Agent shall make distributions pursuant to this Section 2.4(b) of
amounts on deposit in the Special Payments Account on account of the redemption,
purchase (including, without limitation, a purchase resulting from a sale of the
Equipment Notes permitted by Article IV hereof) or prepayment of all of the
Equipment Notes issued pursuant to an Indenture on the Special Distribution Date
for such Special Payment in the following order of priority:
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first, such amount as shall be required to pay (A) the
aggregate amount of all accrued and unpaid Liquidity Expenses and
Policy Expenses then in arrears ("past due amounts") plus (B) the
product of (x) the aggregate amount of all accrued and unpaid Liquidity
Expenses and Policy Expenses not in arrears to such Special
Distribution Date multiplied by (y) a fraction, the numerator of which
is the aggregate outstanding principal amount of Equipment Notes being
redeemed, purchased or prepaid on such Special Distribution Date and
the denominator of which is the aggregate outstanding principal amount
of all Equipment Notes (the "Section 2.4(b) Fraction")("accrued
amounts"), shall be distributed to the relevant Liquidity Providers and
the Policy Provider first in satisfaction of any past due amounts and
then in satisfaction of the accrued amounts, in each case, pro rata on
the basis of the amount of Liquidity Expenses and Policy Expenses, owed
to each Liquidity Provider and the Policy Provider;
second, such amount as shall be required to pay (i) (A) all
accrued and unpaid interest (including interest accrued and unpaid on
any Interest Drawing or any Applied Provider Advance (as defined in any
Liquidity Facility)) then in arrears on all Liquidity Obligations plus
(B) the product of (x) the aggregate amount of all accrued and unpaid
interest on all Liquidity Obligations not in arrears to such Special
Distribution Date (at the rate provided in the applicable Liquidity
Facility) multiplied by (y) the Section 2.4(b) Fraction (in each case
determined after application of the proceeds of any Excess Interest
Policy Drawing or other payment by the Policy Provider to the Liquidity
Provider in respect of any interest on Interest Drawings in accordance
with the provisions of Section 2.6(c)), and (ii)(A) all accrued and
unpaid interest then in arrears on any Policy Drawings made in respect
of any shortfall attributable to a failure by the Liquidity Provider to
honor an Interest Drawing (as more fully provided in the definition of
"Policy Provider Obligations") plus (B) the product of (x) the
aggregate amount of all accrued and unpaid interest on such Policy
Drawings not in arrears to such Special Distribution Date multiplied by
(y) the Section 2.4(b) Fraction, shall be distributed to the Liquidity
Providers and the Policy Provider pro rata on the basis of the amount
of such Liquidity Obligations and such Policy Provider Obligations
payable under this clause "second";
third, such amount as shall be required (A) if any Cash
Collateral Account had been previously funded as provided in Section
3.6(f), to fund such Cash Collateral Account up to its Required Amount
shall be deposited in such Cash Collateral Account, (B) if any
Liquidity Facility shall become a Downgraded Facility or a Non-Extended
Facility at a time when unreimbursed Interest Drawings under such
Liquidity Facility have reduced the Available Amount thereunder to
zero, to deposit into the related Cash Collateral Account an amount
equal to such Cash Collateral Account's Required Amount shall be
deposited in such Cash Collateral Account, and (C) if, with respect to
any particular Liquidity Facility, neither subclause (A) nor subclause
(B) of this clause "third" are applicable, to pay or reimburse the
Liquidity Provider in respect of such Liquidity Facility in an amount
equal to the amount of any unreimbursed Interest Drawings (net of any
and all payments made by the Policy Provider to the Liquidity Provider
with respect to the principal of any Interest Drawing under such
Liquidity Facility) under such Liquidity Facility shall be distributed
to such Liquidity Provider, pro rata on the basis of the amounts of all
such deficiencies and/or unreimbursed Interest Drawings in respect of
each Liquidity Provider;
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fourth, if, with respect to any particular Liquidity Facility,
any amounts are to be distributed pursuant to either subclause (A) or
(B) of clause "third" above, then the Liquidity Provider with respect
to such Liquidity Facility shall be paid the excess of (x) the
aggregate outstanding amount of unreimbursed Advances (whether or not
then due) under such Liquidity Facility over (y) the Required Amount
for the relevant Class, pro rata on the basis of such amounts in
respect of each Liquidity Provider;
fifth, such amount as shall be required to pay in full
Expected Distributions to the holders of Class G Certificates on such
Special Distribution Date shall be distributed to the Class G Trustee;
sixth, such amount as is required to pay the Policy Provider
all Policy Provider Obligations then due to the Policy Provider under
the Policy Provider Agreement (other than amounts payable pursuant to
clauses "first" and "second" of this Section 2.4 and any Excess
Reimbursement Obligations) shall be paid to the Policy Provider;
seventh, such amount as shall be required to pay in full
Expected Distributions to the holders of Class C Certificates on such
Special Distribution Date shall be distributed to the Class C Trustee;
and
eighth, such amounts as shall be required to pay any Excess
Reimbursement Obligations to the Policy Provider.
ninth, the balance, if any, of such Special Payment shall be
transferred to the Collection Account for distribution in accordance
with Section 3.2 hereof.
For the purposes of this Section 2.4(b)(i), clause (x) of the definition of
"Expected Distributions" shall be deemed to read as follows: "(x) accrued, due
and unpaid interest on such Certificates together with (without duplication)
accrued and unpaid interest on a portion of such Certificates equal to the
outstanding principal amount of the Equipment Notes held in trust and being
redeemed, purchased or prepaid (immediately prior to such redemption, purchase
or prepayment), in each case excluding interest, if any, payable with respect to
the Deposits related to such Trust".
(ii) Upon and after the occurrence of a Triggering Event
(whether or not continuing), the Subordination Agent shall make distributions
pursuant to this Section 2.4(b) of amounts on deposit in the Special Payments
Account on account of the redemption or purchase of all of the Equipment Notes
issued pursuant to an Indenture on the Special Distribution Date for such
Special Payment in accordance with Section 3.3 hereof.
(c) Other Special Payments. Except as provided in clause (e)
below, any amounts on deposit in the Special Payments Account other than in
respect of amounts to be distributed pursuant to Section 2.4(b) shall be
distributed on the Special Distribution Date therefor in accordance with Article
III hereof.
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(d) Investment of Amounts in Special Payments Account. Any
amounts on deposit in the Special Payments Account prior to the distribution
thereof pursuant to Section 2.4(b) or (c) shall be invested in accordance with
Section 2.2(b). Investment Earnings on such investments shall be distributed in
accordance with Section 2.4(b) or (c), as the case may be.
(e) Certain Payments. The Subordination Agent will distribute
promptly upon receipt thereof (i) any indemnity payment or expense reimbursement
received by it from the Owner Participant, the Owner Trustee or America West in
respect of any Trustee, any Liquidity Provider, any Policy Provider, any Paying
Agent, any Depositary or any Escrow Agent (collectively, the "Payees") and (ii)
any compensation (including, without limitation, any fees payable to any
Liquidity Provider under Section 2.03 of any Liquidity Facility or to the Policy
Provider under the Policy Provider Agreement) received by it from the Owner
Participant, the Owner Trustee or America West under any Operative Agreement in
respect of any Payee, directly to the Payee entitled thereto.
SECTION 2.5. Designated Representatives. (a) With the delivery
of this Agreement, the Subordination Agent shall furnish to each Liquidity
Provider, the Policy Provider and each Trustee, and from time to time thereafter
may furnish to each Liquidity Provider, the Policy Provider and each Trustee, at
the Subordination Agent's discretion, or upon any Liquidity Provider's, the
Policy Provider's or Trustee's request (which request shall not be made more
than one time in any 12-month period), a certificate (a "Subordination Agent
Incumbency Certificate") of a Responsible Officer of the Subordination Agent
certifying as to the incumbency and specimen signatures of the officers of the
Subordination Agent and the attorney-in-fact and agents of the Subordination
Agent (the "Subordination Agent Representatives") authorized to give Written
Notices on behalf of the Subordination Agent hereunder. Until each Liquidity
Provider, the Policy Provider and Trustee receives a subsequent Subordination
Agent Incumbency Certificate, it shall be entitled to rely on the last
Subordination Agent Incumbency Certificate delivered to it hereunder.
(b) With the delivery of this Agreement, each Trustee shall
furnish to the Subordination Agent, and from time to time thereafter may furnish
to the Subordination Agent, at such Trustee's discretion, or upon the
Subordination Agent's request (which request shall not be made more than one
time in any 12-month period), a certificate (a "Trustee Incumbency Certificate")
of a Responsible Officer of such Trustee certifying as to the incumbency and
specimen signatures of the officers of such Trustee and the attorney-in-fact and
agents of such Trustee (the "Trustee Representatives") authorized to give
Written Notices on behalf of such Trustee hereunder. Until the Subordination
Agent receives a subsequent Trustee Incumbency Certificate, it shall be entitled
to rely on the last Trustee Incumbency Certificate delivered to it hereunder.
(c) With the delivery of this Agreement, each Liquidity
Provider and the Policy Provider shall furnish to the Subordination Agent, and
from time to time thereafter may furnish to the Subordination Agent, at such
Liquidity Provider's or Policy Provider's discretion, or upon the Subordination
Agent's request (which request shall not be made more than one time in any
12-month period), a certificate (each a "Provider Incumbency Certificate") of
any Responsible Officer of such Liquidity Provider or Policy Provider certifying
as to the incumbency and specimen signatures of any officer, attorney-in-fact,
agent or other designated
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representative of such Liquidity Provider or Policy Provider (in each case the
"Provider Representatives" and, together with the Subordination Agent
Representatives and the Trustee Representatives, the "Designated
Representatives") authorized to give Written Notices on behalf of such Liquidity
Provider or Policy Provider hereunder. Until the Subordination Agent receives a
subsequent Provider Incumbency Certificate, it shall be entitled to rely on the
last Provider Incumbency Certificate delivered to it hereunder by the relevant
Liquidity Provider or the Policy Provider.
SECTION 2.6. Controlling Party. (a) Except as provided in
Section 2.6(c) and 9.1(b) hereof, the Trustees, the Liquidity Providers and the
Policy Provider hereby agree that, with respect to any Indenture at any given
time, the Loan Trustee thereunder will be directed by the Controlling Party.
(b) The Person who shall be the "Controlling Party" with
respect to any Indenture shall be: (x) the Policy Provider so long as the Final
Distribution on the Class G Certificates has not been made or any Policy
Provider Obligations remain outstanding, or, if any Policy Provider Default
shall have occurred and be continuing and the Final Distribution on the Class G
Certificates has not been made, the Class G Trustee; and (y) upon payment of the
Final Distributions to the Class G Certificateholders and if either no Policy
Provider Obligations remain outstanding or a Policy Provider Default has
occurred and is continuing, the Class C Trustee. For purposes of giving effect
to the foregoing provisions of this Section 2.6(a) and (b), the Trustees (other
than the Controlling Party) irrevocably agree (and the Certificateholders (other
than the Certificateholders represented by the Controlling Party) shall be
deemed to agree by virtue of their purchase of Certificates) that the
Subordination Agent, as record holder of the Equipment Notes, shall exercise its
voting rights in respect of the Equipment Notes as directed by the Controlling
Party and any vote so exercised shall be binding upon the Trustees and all
Certificateholders.
The Subordination Agent shall give written notice to all of
the other parties to this Agreement promptly upon a change in the identity of
the Controlling Party. Each of the parties hereto agrees that it shall not
exercise any of the rights of the Controlling Party at such time as it is not
the Controlling Party hereunder; provided, however, that nothing herein
contained shall prevent or prohibit any Non-Controlling Party from exercising
such rights as shall be specifically granted to such Non-Controlling Party
hereunder and under the other Operative Agreements.
(c) Notwithstanding the foregoing, at any time after 18 months
from the earliest to occur of (i) the date on which the entire Available Amount
under any Liquidity Facility shall have been drawn (for any reason other than a
Downgrade Drawing or a Non-Extension Drawing) and remain unreimbursed, (ii) the
date on which the entire amount of any Downgrade Drawing or Non-Extension
Drawing under any Liquidity Facility shall have become and remain "Applied
Downgrade Advances" or "Applied Non-Extension Advances", as the case may be,
under and as defined in such Liquidity Facility and (iii) the date on which all
Equipment Notes shall have been Accelerated (provided that, with respect to the
period prior to the Delivery Period Expiry Date, such Equipment Notes have an
aggregate outstanding principal balance of in excess of $100 million), the
Liquidity Provider with the highest outstanding amount of Liquidity Obligations
owed to it (so long as such Liquidity Provider has not defaulted in its
obligation to
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make any Drawing under any Liquidity Facility) shall have the right to elect, by
Written Notice to the Subordination Agent, the Policy Provider and each of the
Trustees, to become the Controlling Party hereunder with respect to any
Indenture at any time from and including the last day of such 18-month period;
provided, however, that if within 15 Business Days after its receipt of any such
written notice from such Liquidity Provider (A) (i) the Policy Provider then
meets the Policy Provider Threshold Rating and (ii) the Policy Provider delivers
to the Subordination Agent (with a copy to each of the Trustees and each
Liquidity Provider) (a) an amended Policy (x) extending the benefits of the
Policy to and covering in full all Drawings under each Liquidity Facility
together with accrued interest thereon (determined without regard to the
availability of funds for the payment thereof by the Subordination Agent) in
respect of the Class G Liquidity Facility and the Class C Liquidity Facility,
(y) permitting each Liquidity Provider when and as such Liquidity Obligations
become due under the applicable Liquidity Facility to demand a payment thereof
under such amended Policy directly from the Policy Provider and (z) prohibiting
any amendment or modification of such amended Policy without the prior written
consent of each Liquidity Provider and otherwise in form and substance
reasonably satisfactory to each Liquidity Provider, (b) a legal opinion to the
effect that the Policy as amended constitutes an enforceable obligation of the
Policy Provider and (c) a Ratings Confirmation issued by each Rating Agency with
respect thereto or (B) the Policy Provider pays to the Class G Liquidity
Provider and the Class C Liquidity Provider all outstanding Drawings under each
Liquidity Facility together with accrued interest thereof (as so determined) in
respect of the Class G Liquidity Facility and the Class C Liquidity Facility,
respectively, then, in either case, the Policy Provider rather than such
Liquidity Provider shall be the Controlling Party so long as no Policy Provider
Default has occurred and is continuing (in which case such Liquidity Provider,
if it so elects and if Liquidity Obligations owing to it remain outstanding, or,
if it does not so elect or if no such Liquidity Obligations remain outstanding,
the Class G Trustee, shall become the Controlling Party). In connection with the
delivery of any such amended Policy, the parties hereto agree to enter into an
amendment to this Agreement and the Subordination Agent agrees to enter into an
amendment to the Policy Provider Agreement, in each instance, to make such
changes thereto as may be necessary to give effect to the foregoing (any such
amendment to this Agreement to be subject to delivery to each of the Trustees
and the Subordination Agent of a Ratings Confirmation issued by each Rating
Agency with respect thereto and each such amendment to be in form and substance
reasonably satisfactory to each party thereto). In addition, each Liquidity
Provider agrees to request the Policy Drawings permitted by such amended Policy
and that the proceeds thereof shall reduce pro tanto the Liquidity Obligations
owing to it.
(d) The exercise of remedies by the Controlling Party under
this Agreement shall be expressly limited by Section 4.1(a)(ii) hereof.
(e) The Controlling Party shall not be entitled to require or
obligate any Non-Controlling Party to provide funds necessary to exercise any
right or remedy hereunder.
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ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION
OF AMOUNTS RECEIVED
SECTION 3.1. Written Notice of Distribution. (a) No later than
3:00 P.M. (New York City time) on the Business Day immediately preceding each
Regular Distribution Date (or Special Distribution Date for purposes of Section
2.4(b) hereof, as the case may be), each of the following Persons shall deliver
to the Subordination Agent a Written Notice setting forth the following
information as at the close of business on such Business Day:
(i) With respect to the Class G Certificates, the Class
G Trustee shall separately set forth the amounts to be paid in
accordance with clause "fifth" of Section 3.2 or 2.4(b), as the case
may be, hereof;
(ii) With respect to the Class C Certificates, the Class
C Trustee shall separately set forth the amounts to be paid in
accordance with clause "seventh" of Section 2.4(b) or clause "seventh"
of Section 3.2, as the case may be, hereof;
(iii) With respect to each Liquidity Facility, the
Liquidity Provider thereunder shall separately set forth the amounts to
be paid to it in accordance with clauses "first", "second", "third" and
"fourth" of Section 3.2 or 2.4(b), as the case may be, hereof;
(iv) The Policy Provider shall set forth the amounts to
be paid to it in accordance with clauses "first", "second", "sixth" and
"eighth" of Section 3.2 or 2.4(b), as the case may be, hereof; and
(v) Each Trustee shall set forth the amounts to be paid
in accordance with clause "ninth" of Section 3.2 hereof.
The notices required under this Section 3.1(a) may be in the form of a schedule
or similar document provided to the Subordination Agent by the parties
referenced therein or by any one of them, which schedule or similar document may
state that, unless there has been a prepayment of the Certificates, such
schedule or similar document is to remain in effect until any substitute notice
or amendment shall be given to the Subordination Agent by the party providing
such notice.
(b) Following the occurrence of a Triggering Event, the
Subordination Agent shall request the following information from the following
Persons, and each of the following Persons shall, upon the request of the
Subordination Agent, deliver a Written Notice to the Subordination Agent setting
forth for such Person the following information:
(i) With respect to the Class G Certificates, the Class G
Trustee shall separately set forth the amounts to be paid in accordance
with clauses "first" (to reimburse payments made by the Class G
Certificateholders pursuant to subclause (iv) of clause "first" of
Section 3.3 hereof) and "seventh" of Section 3.3 hereof;
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(ii) With respect to the Class C Certificates, the Class C
Trustee shall separately set forth the amounts to be paid in accordance
with clauses "first" (to reimburse payments made by the Class C
Certificateholders pursuant to subclause (iv) of clause "first" of
Section 3.3 hereof) and "ninth" of Section 3.3 hereof;
(iii) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be paid
to it in accordance with subclause (iv) of clause "first" of Section
3.3 hereof, subclause (i) of clause "second" and clauses "third",
"fourth" and "fifth" of Section 3.3 hereof;
(iv) The Policy Provider shall separately set forth amounts
to be paid to it in accordance with subclauses (iii) and (iv) of clause
"first" of Section 3.3 hereof, subclause (ii) of clause "second",
subclause (ii) of clause "third", clause "eighth" and clause "tenth" of
Section 3.3 hereof; and
(v) Each Trustee shall set forth the amounts to be paid in
accordance with clause "sixth" of Section 3.3 hereof.
(c) At such time as a Trustee, a Liquidity Provider or the
Policy Provider shall have received all amounts owing to it (and, in the case of
a Trustee, the Certificateholders for which it is acting) pursuant to Section
2.4, 3.2, 3.3 or 3.7 hereof, as applicable, and, in the case of a Liquidity
Provider or the Policy Provider, its commitment or obligations under the related
Liquidity Facility or the Policy, as the case may be, shall have terminated or
expired, such Person shall, by a Written Notice, so inform the Subordination
Agent and each other party to this Agreement.
(d) As provided in Section 6.5 hereof, the Subordination Agent
shall be fully protected in relying on any of the information set forth in a
Written Notice provided by any Trustee, any Liquidity Provider or the Policy
Provider pursuant to paragraphs (a) through (c) above and shall have no
independent obligation to verify, calculate or recalculate any amount set forth
in any Written Notice delivered in accordance with such paragraphs.
(e) Any Written Notice delivered by a Trustee, a Liquidity
Provider, the Policy Provider or the Subordination Agent, as applicable,
pursuant to Section 3.1(a), 3.1(b), 3.1(c) or 3.7 hereof, if made prior to 10:00
A.M. (New York City time) on any Business Day shall be effective on the date
delivered (or if delivered later on a Business Day or if delivered on a day
which is not a Business Day shall be effective as of the next Business Day).
Subject to the terms of this Agreement, the Subordination Agent shall as
promptly as practicable comply with any such instructions; provided, however,
that any transfer of funds pursuant to any instruction received after 10:00 A.M.
(New York City time) on any Business Day may be made on the next succeeding
Business Day.
(f) In the event the Subordination Agent shall not receive
from any Person any information set forth in paragraph (a) or (b) above which is
required to enable the Subordination Agent to make a distribution to such Person
pursuant to Section 3.2 or 3.3 hereof, the Subordination Agent shall request
such information and, failing to receive any such
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information, the Subordination Agent shall not make such distribution(s) to such
Person. In such event, the Subordination Agent shall make distributions pursuant
to clauses "first" through "ninth" of Section 3.2 and clauses "first" through
"tenth" of Section 3.3 to the extent it shall have sufficient information to
enable it to make such distributions, and shall continue to hold any funds
remaining, after making such distributions, until the Subordination Agent shall
receive all necessary information to enable it to distribute any funds so
withheld.
(g) On such dates (but not more frequently than monthly) as
any Liquidity Provider, the Policy Provider or any Trustee shall request, but in
any event automatically at the end of each calendar quarter, the Subordination
Agent shall send to such party a written statement reflecting all amounts on
deposit with the Subordination Agent pursuant to Section 3.1(f) hereof.
SECTION 3.2. Distribution of Amounts on Deposit in the
Collection Account. Except as otherwise provided in Sections 2.4, 3.1(f), 3.3,
3.4 and 3.6(b), amounts on deposit in the Collection Account (or, in the case of
any amount described in Section 2.4(c), on deposit in the Special Payments
Account) shall be promptly distributed on each Regular Distribution Date (or, in
the case of any amount described in Section 2.4(c), on the Special Distribution
Date thereof) in the following order of priority and in accordance with the
information provided to the Subordination Agent pursuant to Section 3.1(a)
hereof:
first, such amount as shall be required to pay (i) all accrued
and unpaid Liquidity Expenses owed to each Liquidity Provider and (ii)
all accrued and unpaid Policy Expenses owed to the Policy Provider,
shall be distributed to each Liquidity Provider and the Policy Provider
pro rata on the basis of the amount of Liquidity Expenses and Policy
Expenses owed to each Liquidity Provider and the Policy Provider;
second, such amount as shall be required to pay (i) the
aggregate amount of interest accrued and unpaid on all Liquidity
Obligations (at the rate, or in the amount, provided in the applicable
Liquidity Facility) (determined after the application of the proceeds
of any Excess Interest Policy Drawing or other payment by the Policy
Provider to the Liquidity Provider in respect of any interest on
Interest Drawings in accordance with the provisions of Section 2.6(c))
and (ii) the aggregate amount of interest accrued and unpaid on any
Policy Drawings made in respect of any shortfall attributable to a
failure by the Liquidity Provider to honor any Interest Drawing (as
more fully provided in the definition of "Policy Provider Obligations")
shall be distributed to the Liquidity Providers and the Policy Provider
pro rata on the basis of the amount of such Liquidity Obligations and
such Policy Provider Obligations payable under this clause "second";
third, such amount as shall be required (A) if any Cash
Collateral Account had been previously funded as provided in Section
3.6(f), to fund such Cash Collateral Account up to its Required Amount
shall be deposited in such Cash Collateral Account, (B) if any
Liquidity Facility shall become a Downgraded Facility or a Non-Extended
Facility at a time when unreimbursed Interest Drawings under such
Liquidity Facility have reduced the Available Amount thereunder to
zero, to deposit into the related Cash Collateral Account an amount
equal to such Cash Collateral Account's Required Amount shall be
deposited in such Cash Collateral Account, and (C) if, with respect to
any
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particular Liquidity Facility, neither subclause (A) nor subclause (B)
of this clause "third" is applicable, to pay or reimburse the Liquidity
Provider in respect of such Liquidity Facility in an amount equal to
the amount of all Liquidity Obligations (net of any and all payments
made by the Policy Provider to the Liquidity Provider with respect to
the principal of any Interest Drawing under such Liquidity Facility)
then due under such Liquidity Facility (other than amounts payable
pursuant to clause "first" or "second" of this Section 3.2) shall be
distributed to such Liquidity Provider, pro rata on the basis of the
amounts of all such deficiencies and/or unreimbursed Liquidity
Obligations in respect of each Liquidity Provider;
fourth, if, with respect to any particular Liquidity Facility,
any amounts are to be distributed pursuant to either subclause (A) or
(B) of clause "third" above, then the Liquidity Provider with respect
to such Liquidity Facility shall be paid the excess of (x) the
aggregate outstanding amount of unreimbursed Advances (whether or not
then due) under such Liquidity Facility over (y) the Required Amount
for the relevant Class, pro rata on the basis of such amounts in
respect of each Liquidity Provider;
fifth, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class G Certificates on
such Distribution Date shall be distributed to the Class G Trustee;
sixth, such amount as shall be required to pay the Policy
Provider all Policy Provider Obligations then due to the Policy
Provider under the Policy Provider Agreement (other than amounts
payable pursuant to clauses "first" and "second" of this Section 3.2
and Excess Reimbursement Obligations) shall be paid to the Policy
Provider;
seventh, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class C Certificates on
such Distribution Date shall be distributed to the Class C Trustee;
eighth, such amount as shall be required to pay in full any
Excess Reimbursement Obligations shall be distributed to the Policy
Provider;
ninth, such amount as shall be required to pay in full the
aggregate unpaid amount of fees and expenses payable as of such
Distribution Date to the Subordination Agent and each Trustee pursuant
to the terms of this Agreement and the Trust Agreements, as the case
may be, shall be distributed to the Subordination Agent and such
Trustee; and
tenth, the balance, if any, of any such amount remaining
thereafter shall be held in the Collection Account for later
distribution in accordance with this Article III.
SECTION 3.3. Distribution of Amounts on Deposit Following a
Triggering Event. Except as otherwise provided in Sections 3.1(f), 3.6(b) and
3.6(k) hereof, upon the occurrence of a Triggering Event and at all times
thereafter, all funds in the Collection Account or the Special Payments Account
shall be promptly distributed (and, in any event, on each Interest Payment Date)
by the Subordination Agent in the following order of priority:
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first, such amount as shall be required to reimburse (i) the
Subordination Agent for any reasonable out-of-pocket costs and expenses
actually incurred by it (to the extent not previously reimbursed) in
the protection of, or the realization of the value of, the Equipment
Notes or any Collateral or Trust Indenture Estate, shall be applied by
the Subordination Agent in reimbursement of such costs and expenses,
(ii) each Trustee for any amounts of the nature described in clause (i)
above actually incurred by it under the applicable Trust Agreement (to
the extent not previously reimbursed), shall be distributed to such
Trustee, (iii) the Policy Provider for any amounts of the nature
described in clause (i) above actually incurred by it (to the extent
not previously reimbursed), shall be distributed to the Policy
Provider, and (iv) any Liquidity Provider, the Policy Provider or any
Certificateholder for payments, if any, made by it to the Subordination
Agent or any Trustee in respect of amounts described in clause (i)
above, shall be distributed to such Liquidity Provider, the Policy
Provider or to the applicable Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all
amounts described in clauses (i) through (iv) above;
second, such amount remaining as shall be required to pay (i)
all accrued and unpaid Liquidity Expenses owed to each Liquidity
Provider and (ii) all accrued and unpaid Policy Expenses owed to the
Policy Provider, shall be distributed to each Liquidity Provider and
the Policy Provider pro rata on the basis of the amount of Liquidity
Expenses and Policy Expenses owed to each Liquidity Provider and the
Policy Provider;
third, such amount remaining as shall be required to pay (i)
the aggregate amount of interest accrued and unpaid on all Liquidity
Obligations (at the rate, or in the amount, provided in the applicable
Liquidity Facility) (determined after the application of the proceeds
of any Excess Interest Policy Drawing or other payment by the Policy
Provider to the Liquidity Provider in accordance with the provisions of
Section 2.6(c)) and (ii) the aggregate amount of interest accrued and
unpaid on any Policy Drawings made in respect of any shortfall
attributable to a failure by the Liquidity Provider to honor any
Interest Drawing (as more fully provided in the definition of "Policy
Provider Obligations") shall be distributed to the Liquidity Provider
and the Policy Provider pro rata on the basis of the amount of such
Liquidity Obligations and such Policy Provider Obligations payable
under this clause "third";
fourth, such amount remaining as shall be required (A) if any
Cash Collateral Account had been previously funded as provided in
Section 3.6(f), unless (i) a Performing Note Deficiency exists and a
Liquidity Event of Default shall have occurred and be continuing with
respect to the relevant Liquidity Facility or (ii) a Final Drawing
shall have occurred with respect to such Liquidity Facility, to fund
such Cash Collateral Account up to its Required Amount (less the amount
of any repayments of Interest Drawings under such Liquidity Facility
while subclause (A)(i) above is applicable) shall be deposited in such
Cash Collateral Account, (B) if any Liquidity Facility shall become a
Downgraded Facility or a Non-Extended Facility at a time when
unreimbursed Interest Drawings under such Liquidity Facility have
reduced the Available Amount thereunder to zero, unless (i) a
Performing Note Deficiency exists and a Liquidity Event of Default
shall have occurred and be continuing with respect to the relevant
Liquidity Facility or
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(ii) a Final Drawing shall have occurred with respect to such Liquidity
Facility, to deposit into the related Cash Collateral Account an amount
equal to such Cash Collateral Account's Required Amount (less the
amount of any repayments of Interest Drawings under such Liquidity
Facility while subclause (B)(i) above is applicable) shall be deposited
in such Cash Collateral Account, and (C) if, with respect to any
particular Liquidity Facility, neither subclause (A) nor subclause (B)
of this clause "fourth" are applicable, to pay in full the outstanding
amount of all Liquidity Obligations (net of any and all payments made
by the Policy Provider to the Liquidity Provider) then due under such
Liquidity Facility (other than amounts payable pursuant to clause
"second" or "third" of this Section 3.3) shall be distributed to such
Liquidity Provider, pro rata on the basis of the amounts of all such
deficiencies and/or unreimbursed Liquidity Obligations in respect of
each Liquidity Provider;
fifth, if, with respect to any particular Liquidity Facility,
any amounts are to be distributed pursuant to either subclause (A) or
(B) of clause "fourth" above, then the Liquidity Provider with respect
to such Liquidity Facility shall be paid the excess of (x) the
aggregate outstanding amount of unreimbursed Advances (whether or not
then due) under such Liquidity Facility over (y) the Required Amount
for the relevant Class (less the amount of any repayments of Interest
Drawings under such Liquidity Facility while subclause (A)(i) or
(B)(i), as the case may be, of clause "fourth" above is applicable),
pro rata on the basis of such amounts in respect of each Liquidity
Provider;
sixth, such amount as shall be required to reimburse or pay
(i) the Subordination Agent for any Tax (other than Unindemnified
Taxes), expense, fee, charge or other loss incurred by or any other
amount payable to the Subordination Agent in connection with the
transactions contemplated hereby (to the extent not previously
reimbursed), shall be applied by the Subordination Agent in
reimbursement of such amount, (ii) each Trustee for any Tax (other than
Unindemnified Taxes), expense, fee, charge, loss or any other amount
payable to such Trustee under the applicable Trust Agreements (to the
extent not previously reimbursed), shall be distributed to such
Trustee, and (iii) each Certificateholder for payments, if any, made by
it pursuant to Section 5.2 hereof in respect of amounts described in
clause (i) above, shall be distributed to the applicable Trustee for
the account of such Certificateholder, in each such case, pro rata on
the basis of all amounts described in clauses (i) through (iii) above;
seventh, such amount remaining as shall be required to pay in
full Adjusted Expected Distributions on the Class G Certificates shall
be distributed to the Class G Trustee;
eighth, such amount as is required to pay to the Policy
Provider all Policy Provider Obligations then due to the Policy
Provider under the Policy Provider Agreement (other than amounts
payable pursuant to clauses "first", "second" and "third" of this
Section 3.3 and Excess Reimbursement Obligations) shall be paid to the
Policy Provider;
ninth, such amount as shall be required to pay in full
Adjusted Expected Distributions on the Class C Certificates shall be
distributed to the Class C Trustee; and
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tenth, such amount remaining as shall be required to pay in
full any Excess Reimbursement Obligations shall be distributed to the
Policy Provider.
SECTION 3.4. Other Payments. (a) Any payments received by the
Subordination Agent for which no provision as to the application thereof is made
in this Agreement shall be distributed by the Subordination Agent (i) in the
order of priority specified in Section 3.3 hereof and (ii) to the extent
received or realized at any time after the Final Distributions for each Class of
Certificates have been made, in the manner provided in clause "first" of Section
3.3 hereof.
(b) Except as otherwise provided in Section 3.3 hereof, if the
Subordination Agent receives any Scheduled Payment after the Scheduled Payment
Date relating thereto, but prior to such payment becoming an Overdue Scheduled
Payment, then the Subordination Agent shall deposit such Scheduled Payment in
the Collection Account and promptly distribute such Scheduled Payment in
accordance with the priority of distributions set forth in Section 3.2 hereof;
provided that, for the purposes of this Section 3.4(b) only, each reference in
clause "seventh" of Section 3.2 to "Distribution Date" shall be deemed to mean
the actual date of payment of such Scheduled Payment and each reference in
clause "fifth" or "sixth" of Section 3.2 to "Distribution Date" shall be deemed
to refer to such Scheduled Payment Date.
SECTION 3.5. Payments to the Trustees, Liquidity Providers and
Policy Provider. Any amounts distributed hereunder to any Liquidity Provider or
the Policy Provider shall be paid to such Liquidity Provider or Policy Provider
by wire transfer of funds to the address such Liquidity Provider or Policy
Provider shall provide to the Subordination Agent. The Subordination Agent shall
provide a Written Notice of any such transfer to the applicable Liquidity
Provider or Policy Provider, as the case may be, at the time of such transfer.
Any amounts distributed hereunder by the Subordination Agent to any Trustee
which shall not be the same institution as the Subordination Agent shall be paid
to such Trustee by wire transfer funds at the address such Trustee shall provide
to the Subordination Agent.
SECTION 3.6. Liquidity Facilities. (a) Interest Drawings. If
on any Distribution Date, after giving effect to the subordination provisions of
this Agreement, the Subordination Agent shall not have sufficient funds for the
payment of any amounts due and owing in respect of accrued interest on the Class
G Certificates or the Class C Certificates (at the Stated Interest Rate for such
Class of Certificates), then, prior to 10:00 a.m. (New York City time) on such
Distribution Date, the Subordination Agent shall request a drawing (each such
drawing, an "Interest Drawing") under the Liquidity Facility with respect to
such Class of Certificates (and concurrently with the making of such request,
the Subordination Agent shall give notice to the Policy Provider of such
insufficiency of funds) in an amount equal to the lesser of (i) an amount
sufficient to pay the amount of such accrued interest (at the Stated Interest
Rate for such Class of Certificates) and (ii) the Available Amount under such
Liquidity Facility, and shall pay such amount to the Trustee with respect to
such Class of Certificates in payment of such accrued interest.
(b) Application of Interest Drawings. Notwithstanding anything
to the contrary contained in this Agreement, (i) all payments received by the
Subordination Agent in
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respect of an Interest Drawing under the Class G Liquidity Facility and all
amounts withdrawn by the Subordination Agent from the Class G Cash Collateral
Account, and payable in each case to the Class G Trustee on behalf of the Class
G Certificateholders, shall be promptly distributed to the Class G Trustee, and
(ii) all payments received by the Subordination Agent in respect of an Interest
Drawing under the Class C Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class C Cash Collateral Account, and payable in
each case to the Class C Trustee on behalf of the Class C Certificateholders,
shall be promptly distributed to the Class C Trustee, except that if after any
Distribution Date the Subordination Agent shall receive any amount in respect of
an Interest Drawing under the Class G Liquidity Facility or a withdrawal from
the Class G Cash Collateral Account to pay Accrued Class G Interest after such
Accrued Class G Interest has been fully paid by a Policy Drawing under the
Policy, such amounts shall be paid directly to the Policy Provider as
reimbursement of such Policy Drawing rather than to the Class G Trustee on
behalf of the Class G Certificateholders and shall constitute an Interest
Drawing under the Class G Liquidity Facility or a withdrawal from the Class G
Cash Collateral Account, as the case may be, hereunder.
(c) Downgrade Drawings. If at any time (i) the short-term
unsecured debt rating of any Liquidity Provider (or the Guarantor, with respect
to any Liquidity Facility, if MSCS is the Liquidity Provider thereunder), issued
by either Rating Agency is lower than the applicable Threshold Rating or (ii)
any Guarantee Agreement, if applicable, related to any Liquidity Facility ceases
to be in full force and effect or becomes invalid or unenforceable, or the
Guarantor denies its liability thereunder (any such occurrence, a "Guarantee
Event"), within 10 days after receiving notice of such downgrading or Guarantee
Event (but not later than the expiration date of the Liquidity Facility issued
by the downgraded Liquidity Provider (the "Downgraded Facility")), such
Liquidity Provider or America West may arrange for a Replacement Liquidity
Provider to issue and deliver a Replacement Liquidity Facility to the
Subordination Agent. If a Downgraded Facility has not been replaced in
accordance with the terms of this paragraph, the Subordination Agent shall, on
such 10th day (or if such 10th day is not a Business Day, on the next succeeding
Business Day) (or, if earlier, the expiration date of such Downgraded Facility),
request a drawing in accordance with and to the extent permitted by such
Downgraded Facility (such drawing, a "Downgrade Drawing") of all available and
undrawn amounts thereunder. Amounts drawn pursuant to a Downgrade Drawing shall
be maintained and invested as provided in Section 3.6(f) hereof. The applicable
Liquidity Provider may also arrange for a Replacement Liquidity Provider to
issue and deliver a Replacement Liquidity Facility at any time after such
Downgrade Drawing so long as such Downgrade Drawing has not been reimbursed in
full to such Liquidity Provider.
(d) Non-Extension Drawings. If any Liquidity Facility with
respect to any Class of Certificates is scheduled to expire on a date (the
"Stated Expiration Date") prior to the date that is 15 days after the Final
Legal Distribution Date for such Class of Certificates, then, no earlier than
the 60th day and no later than the 40th day prior to the then Stated Expiration
Date, the Subordination Agent shall request that such Liquidity Provider extend
the Stated Expiration Date for a period of 364 days after the Stated Expiration
Date (unless the obligations of such Liquidity Provider thereunder are earlier
terminated in accordance with such Liquidity Facility). The Liquidity Provider
shall advise the Subordination Agent, no earlier than 40 days and no later than
25 days prior to such Stated Expiration Date, whether, in its sole discretion,
it agrees to so extend the Stated Expiration Date. If on or before such 25th
day, the Liquidity Provider fails
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irrevocably and unconditionally to advise the Subordination Agent on or before
the 25th day prior to the Stated Expiration Date then in effect that such Stated
Expiration Date shall be so extended and such Liquidity Facility shall not have
been replaced in accordance with Section 3.6(e) hereof, the Subordination Agent
shall, on such 25th day (or as soon as possible thereafter), in accordance with
the terms of the expiring Liquidity Facility (a "Non-Extended Facility"),
request a drawing under such expiring Liquidity Facility (such drawing, a
"Non-Extension Drawing") of all available and undrawn amounts thereunder.
Amounts drawn pursuant to a Non-Extension Drawing shall be maintained and
invested in accordance with Section 3.6(f) hereof. Notwithstanding the foregoing
provisions of this Section 3.6(d), so long as MSCS is the Liquidity Provider for
any Liquidity Facility, the Stated Expiration Date therefor shall be
automatically extended, effective on the 25th day prior to such Stated
Expiration Date (unless such Stated Expiration Date is on or after the date that
is 15 days after the Final Legal Distribution Date for the relevant Class of
Certificates), for a period of 364 days after such Stated Expiration Date
(unless the obligations of such Liquidity Provider are earlier terminated in
accordance with such Liquidity Facility) without the necessity of any act by the
Subordination Agent or such Liquidity Provider, unless such Liquidity Provider
shall advise the Subordination Agent, prior to such 25th day, that it does not
agree to such extension of the Stated Expiration Date, in which event, the
Subordination Agent shall, on such 25th day (or as soon as possible thereafter),
in accordance with and to the extent permitted by the terms of the Non-Extended
Facility, request a Non-Extension Drawing under the Non-Extended Facility of all
available and undrawn amounts thereunder.
(e) Issuance of Replacement Liquidity Facility. (i) At any
time, America West may, at its option, with cause or without cause, arrange for
a Replacement Liquidity Facility to replace any Liquidity Facility for any Class
of Certificates (including any Replacement Liquidity Facility provided pursuant
to Section 3.6(e)(ii) hereof); provided, however, that the initial Liquidity
Provider for any Liquidity Facility shall not be replaced by America West as a
Liquidity Provider with respect to such Liquidity Facility prior to the fifth
anniversary of the Closing Date unless (A) there shall have become due to such
initial Liquidity Provider, or such initial Liquidity Provider shall have
demanded, amounts pursuant to Section 3.01, 3.02 or 3.03 of any applicable
Liquidity Facility and the replacement of such initial Liquidity Provider would
reduce or eliminate the obligation to pay such amounts or America West
determines in good faith that there is a substantial likelihood that such
initial Liquidity Provider will have the right to claim any such amounts (unless
such initial Liquidity Provider waives, in writing, any right it may have to
claim such amounts), which determination shall be set forth in a certificate
delivered by America West to such initial Liquidity Provider setting forth the
basis for such determination and accompanied by an opinion of outside counsel
selected by America West and reasonably acceptable to such initial Liquidity
Provider verifying the legal conclusions, if any, of such certificate relating
to such basis, provided that, in the case of any likely claim for such amounts
based upon any proposed, or proposed change in, law, rule, regulation,
interpretation, directive, requirement, request or administrative practice, such
opinion may assume the adoption or promulgation of such proposed matter, (B) it
shall become unlawful or impossible for such initial Liquidity Provider (or its
Lending Office) to maintain or fund its LIBOR Advances as described in Section
3.10 of any Liquidity Facility, (C) any Liquidity Facility of such initial
Liquidity Provider shall become a Downgraded Facility or a Non-Extended Facility
or a Downgrade Drawing or a Non-Extension Drawing shall have occurred under any
Liquidity Facility of such initial Liquidity Provider or (D) such initial
Liquidity
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Provider shall have breached any of its payment (including, without limitation,
funding) obligations under any Liquidity Facility in respect of which it is the
Liquidity Provider. If such Replacement Liquidity Facility is provided at any
time after a Downgrade Drawing or Non-Extension Drawing has been made, all funds
on deposit in the relevant Cash Collateral Account will be returned to the
Liquidity Provider being replaced.
(ii) If any Liquidity Provider shall determine not to extend
any of its Liquidity Facilities in accordance with Section 3.6(d), then
such Liquidity Provider may, at its option, arrange for a Replacement
Liquidity Facility to replace such Liquidity Facility during the period
no earlier than 40 days and no later than 25 days prior to the then
effective Stated Expiration Date of such Liquidity Facility.
(iii) No Replacement Liquidity Facility arranged by America
West or a Liquidity Provider in accordance with clause (i) or (ii)
above or pursuant to Section 3.6(c), respectively, shall become
effective and no such Replacement Liquidity Facility shall be deemed a
"Liquidity Facility" under the Operative Agreements, unless and until
(A) each of the conditions referred to in sub-clauses (iv)(x) and (z)
below shall have been satisfied and (B) in the case of a Replacement
Liquidity Facility arranged by a Liquidity Provider under Section
3.6(e)(ii) or pursuant to Section 3.6(c), such Replacement Liquidity
Facility is acceptable to America West.
(iv) In connection with the issuance of each Replacement
Liquidity Facility, the Subordination Agent shall (x) prior to the
issuance of such Replacement Liquidity Facility, obtain written
confirmation from each Rating Agency that such Replacement Liquidity
Facility will not cause a reduction of any rating then in effect for
any Class of Certificates by such Rating Agency (without regard to any
downgrading of any rating of any Liquidity Provider (or its guarantor)
being replaced pursuant to Section 3.6(c) hereof and without regard to
the Policy) and, in the case of the Class G Liquidity Facility only,
the written consent of the Policy Provider (which consent shall not be
unreasonably withheld or delayed), (y) pay all Liquidity Obligations
then owing to the replaced Liquidity Provider (which payment shall be
made first from available funds in the applicable Cash Collateral
Account as described in clause (vii) of Section 3.6(f) hereof, and
thereafter from any other available source, including, without
limitation, a drawing under the Replacement Liquidity Facility) and (z)
cause the issuer of the Replacement Liquidity Facility to deliver the
Replacement Liquidity Facility to the Subordination Agent, together
with a legal opinion opining that such Replacement Liquidity Facility
is an enforceable obligation of such Replacement Liquidity Provider.
(v) Upon satisfaction of the conditions set forth in clauses
(iii) and (iv) of this Section 3.6(e) with respect to a Replacement
Liquidity Facility, (w) the replaced Liquidity Facility shall
terminate, (x) the Subordination Agent shall, if and to the extent so
requested by America West or the Liquidity Provider being replaced,
execute and deliver any certificate or other instrument required in
order to terminate the replaced Liquidity Facility, shall surrender the
replaced Liquidity Facility to the Liquidity Provider being replaced
and shall execute and deliver the Replacement Liquidity Facility and
any associated Fee Letter, (y) each of the parties hereto shall enter
into any amendments to this Agreement necessary to give effect to (1)
the replacement of the applicable Liquidity
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Provider with the applicable Replacement Liquidity Provider and (2) the
replacement of the applicable Liquidity Facility with the applicable
Replacement Liquidity Facility and (z) the applicable Replacement
Liquidity Provider shall be deemed to be a Liquidity Provider with the
rights and obligations of a Liquidity Provider hereunder and under the
other Operative Agreements and such Replacement Liquidity Facility
shall be deemed to be a Liquidity Facility hereunder and under the
other Operative Agreements.
(f) Cash Collateral Accounts; Withdrawals; Investments. In the
event the Subordination Agent shall draw all available amounts under the Class G
Liquidity Facility or the Class C Liquidity Facility pursuant to Section 3.6(c),
3.6(d) or 3.6(i) hereof, or in the event amounts are to be deposited in the
Class G Cash Collateral Account or the Class C Cash Collateral Account pursuant
to subclause (A) or (B) of clause "third" of Section 2.4(b)(i), subclause (A) or
(B) of clause "third" of Section 3.2 or subclause (A) or (B) of clause "fourth"
of Section 3.3, amounts so drawn or to be deposited, as the case may be, shall
be deposited by the Subordination Agent in the Class G Cash Collateral Account
or the Class C Cash Collateral Account, respectively. All amounts on deposit in
each Cash Collateral Account shall be invested and reinvested in Eligible
Investments in accordance with Section 2.2(b) hereof.
On each Interest Payment Date (or, in the case of any Special
Distribution Date occurring as contemplated in Section 2.4(b) hereof prior to
the occurrence of a Triggering Event (a "Special Payment Withdrawal"), on such
Special Distribution Date), Investment Earnings on amounts on deposit in each
Cash Collateral Account (or, in the case of any Special Payment Withdrawal, a
fraction of such Investment Earnings equal to the Section 2.4(b) Fraction) shall
be deposited in the Collection Account (or, in the case of any Special Payment
Withdrawal, the Special Payments Account) and applied on such Interest Payment
Date (or Special Distribution Date, as the case may be) in accordance with
Section 2.4, 3.2 or 3.3 (as applicable). The Subordination Agent shall deliver a
written statement to America West, the Policy Provider and the Liquidity
Provider one day prior to each Interest Payment Date and Special Distribution
Date setting forth the aggregate amount of Investment Earnings held in the Cash
Collateral Accounts as of such date. In addition, from and after the date funds
are so deposited, the Subordination Agent shall make withdrawals from such
account as follows:
(i) on each Distribution Date, the Subordination Agent shall,
to the extent it shall not have received funds to pay accrued and
unpaid interest due and owing on the Class G Certificates (at the
Stated Interest Rate for the Class G Certificates) from any other
source, withdraw from the Class G Cash Collateral Account, and pay to
the Class G Trustee, an amount equal to the lesser of (x) an amount
necessary to pay accrued and unpaid interest (at the Stated Interest
Rate for the Class G Certificates) on such Class G Certificates and (y)
the amount on deposit in the Class G Cash Collateral Account;
(ii) on each Distribution Date, the Subordination Agent shall,
to the extent it shall not have received funds to pay accrued and
unpaid interest due and owing on the Class C Certificates (at the
Stated Interest Rate for the Class C Certificates) from any other
source, withdraw from the Class C Cash Collateral Account, and pay to
the Class C Trustee, an amount equal to the lesser of (x) an amount
necessary to pay accrued and unpaid interest (at the Stated Interest
Rate for the Class C Certificates) on such Class C Certificates and (y)
the amount on deposit in the Class C Cash Collateral Account;
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(iii) on each date on which the Pool Balance of the Class G
Trust shall have been reduced by payments made to the Class G
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement for
such Class, the Subordination Agent shall withdraw from the Class G
Cash Collateral Account such amount as is necessary so that, after
giving effect to the reduction of the Pool Balance on such date and any
transfer of Investment Earnings from such Cash Collateral Account to
the Collection Account or the Special Payments Account on such date, an
amount equal to the sum of the Required Amount (with respect to the
Class G Liquidity Facility) plus (if on a Special Distribution Date not
coinciding with an Interest Payment Date) Investment Earnings on
deposit in such Cash Collateral Account will be on deposit in the Class
G Cash Collateral Account and shall first, pay such withdrawn amount to
the Class G Liquidity Provider until the Liquidity Obligations (with
respect to the Class G Certificates) owing to such Liquidity Provider
shall have been paid in full, and second, deposit any remaining
withdrawn amount in the Collection Account;
(iv) on each date on which the Pool Balance of the Class C
Trust shall have been reduced by payments made to the Class C
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement for
such Class, the Subordination Agent shall withdraw from the Class C
Cash Collateral Account such amount as is necessary so that, after
giving effect to the reduction of the Pool Balance on such date and any
transfer of Investment Earnings from such Cash Collateral Account to
the Collection Account or the Special Payments Account on such date, an
amount equal to the sum of the Required Amount (with respect to the
Class C Liquidity Facility) plus (if such date is a Special
Distribution Date not coinciding with an Interest Payment Date)
Investment Earnings on deposit in such Cash Collateral Account will be
on deposit in the Class C Cash Collateral Account and shall first, pay
such withdrawn amount to the Class C Liquidity Provider until the
Liquidity Obligations (with respect to the Class C Certificates) owing
to such Liquidity Provider shall have been paid in full, and second,
deposit any remaining withdrawn amount in the Collection Account;
(v) if a Replacement Liquidity Facility for any Class of
Certificates shall be delivered to the Subordination Agent following
the date on which funds have been deposited into the Cash Collateral
Account for such Class of Certificates, the Subordination Agent shall
withdraw all amounts on deposit in such Cash Collateral Account and
shall pay such amounts to the replaced Liquidity Provider until all
Liquidity Obligations owed to such Person shall have been paid in full,
and shall deposit any remaining amount in the Collection Account; and
(vi) following the payment of Final Distributions with respect
to any Class of Certificates, on the date on which the Subordination
Agent shall have been notified by the Liquidity Provider for such Class
of Certificates that the Liquidity Obligations owed to such Liquidity
Provider have been paid in full, the Subordination Agent shall withdraw
all amounts on deposit in the Cash Collateral Account in respect of
such Class of Certificates and shall deposit such amount in the
Collection Account.
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(g) Reinstatement. With respect to any Interest Drawing under
the Liquidity Facility for any Trust, upon the reimbursement of the applicable
Liquidity Provider for all or any part of the amount of such Interest Drawing,
together with any accrued interest thereon, the Available Amount of such
Liquidity Facility shall be reinstated by an amount equal to the amount of such
Interest Drawing so reimbursed to the applicable Liquidity Provider but not to
exceed the Stated Amount for such Liquidity Facility; provided, however, that
such Liquidity Facility shall not be so reinstated in part or in full at any
time if (x) both a Performing Note Deficiency exists and a Liquidity Event of
Default shall have occurred and be continuing with respect to the relevant
Liquidity Facility or (y) a Final Drawing shall have occurred with respect to
such Liquidity Facility. In the event that, with respect to any particular
Liquidity Facility, (i) funds are withdrawn from any Cash Collateral Account
pursuant to clause (i), (ii) or (iii) of Section 3.6(f) hereof or (ii) such
Liquidity Facility shall become a Downgraded Facility or a Non-Extended Facility
at a time when unreimbursed Interest Drawings under such Liquidity Facility have
reduced the Available Amount thereunder to zero, then funds received by the
Subordination Agent at any time other than (x) any time when a Liquidity Event
of Default shall have occurred and be continuing with respect to such Liquidity
Facility and a Performing Note Deficiency exists or (y) any time after a Final
Drawing shall have occurred with respect to such Liquidity Facility shall be
deposited in such Cash Collateral Account as and to the extent provided in
clause "third" of Section 2.4(b), clause "third" of Section 3.2 or clause
"fourth" of Section 3.3, as applicable, and applied in accordance with Section
3.6(f) hereof.
(h) Reimbursement. The amount of each drawing under the
Liquidity Facilities shall be due and payable, together with interest thereon,
on the dates and at the rates, respectively, provided in the Liquidity
Facilities.
(i) Final Drawing. Upon receipt from a Liquidity Provider of a
Termination Notice with respect to any Liquidity Facility, the Subordination
Agent shall, not later than the date specified in such Termination Notice, in
accordance with the terms of such Liquidity Facility, request a drawing under
such Liquidity Facility of all available and undrawn amounts thereunder (a
"Final Drawing"). Amounts drawn pursuant to a Final Drawing shall be maintained
and invested in accordance with Section 3.6(f) hereof.
(j) Reduction of Stated Amount. Promptly following each date
on which the Required Amount of the Liquidity Facility for a Class of
Certificates is reduced as a result of a reduction in the Pool Balance with
respect to such Certificates, the Subordination Agent shall, if any such
Liquidity Facility provides for reductions of the Stated Amount of such
Liquidity Facility and if such reductions are not automatic, request such
Liquidity Provider for such Class of Certificates to reduce such Stated Amount
to an amount equal to the Required Amount with respect to such Liquidity
Facility (as calculated by the Subordination Agent after giving effect to such
payment). Each such request shall be made in accordance with the provisions of
the applicable Liquidity Facility.
(k) Relation to Subordination Provisions. Interest Drawings
under the Liquidity Facilities and withdrawals from the Cash Collateral
Accounts, in each case, in respect of interest on the Certificates of any Class,
will be distributed to the Trustee for such Class of Certificates for
distribution to Certificateholders of the related Class, notwithstanding
Sections 3.2, 3.3 and 3.6(h) hereof.
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(l) Assignment of Liquidity Facility. The Subordination Agent
agrees not to consent to the assignment by any Liquidity Provider of any of its
rights or obligations under any Liquidity Facility or any interest therein,
unless (i) America West shall have consented to such assignment, such consent to
be within America West's sole discretion, (ii) each Rating Agency shall have
provided a Ratings Confirmation in respect of such assignment and (iii) in the
case of the Class G Liquidity Facility only, the Policy Provider shall have
consented to such assignment (which consent shall not be unreasonably withheld
or delayed), and, upon the satisfaction of (i), (ii) and (iii) (if applicable),
the Subordination Agent shall give such consent.
SECTION 3.7. The Policy. (a) Interest Drawings. If on any
Regular Distribution Date (other than the Final Legal Distribution Date) after
giving effect to the subordination provisions of this Agreement and to the
application of any amounts received by the Escrow Agent in the Class G Paying
Agent Account in respect of accrued interest on the Class G Deposits, any
Drawing paid under the Class G Liquidity Facility in respect of interest due on
the Class G Certificates on such Distribution Date and any withdrawal of funds
from the Class G Cash Collateral Account in respect of such interest, the
Subordination Agent does not then have sufficient funds available for the
payment of all amounts due and owing in respect of accrued interest on the Class
G Certificates at the Stated Interest Rate for Class G Certificates ("Accrued
Class G Interest"), then, prior to 1:00 p.m. (New York City time) on such
Distribution Date, the Subordination Agent (i) shall deliver a Notice for
Payment, as provided in the Policy, to the Policy Provider or its fiscal agent,
requesting a Policy Drawing under the Policy (for payment into the Policy
Account) in an amount sufficient to enable the Subordination Agent to pay such
Accrued Class G Interest and (ii) shall pay such amount from the Policy Account
to the Class G Trustee in payment of such Accrued Class G Interest on such
Distribution Date.
(b) Proceeds Deficiency Drawing. If on any Special
Distribution Date (other than an Election Distribution Date) established by the
Subordination Agent by reason of its receipt of a Special Payment constituting
the proceeds of any Series G Equipment Note or related Trust Indenture Estate or
Collateral, as the case may be, and if on such Special Distribution Date after
giving effect to the subordination provisions of this Agreement and to the
application of any amounts received by the Escrow Agent in the Class G Paying
Agent Account in respect of accrued interest on the Class G Deposits, any
Drawing paid under the Class G Liquidity Facility in respect of interest due on
the Class G Certificates on such Distribution Date and any withdrawal of funds
in the Class G Cash Collateral Account in respect of such interest, the
Subordination Agent does not then have sufficient funds available for a
reduction in the outstanding Pool Balance of the Class G Certificates by an
amount equal to the outstanding principal amount of such Equipment Note
(determined immediately prior to the receipt of such proceeds) plus interest on
the amount of such reduction accrued at the Stated Interest Rate for the period
from the immediately preceding Regular Distribution Date to such Special
Distribution Date, then, prior to 1:00 p.m. (New York City time) on such Special
Distribution Date, the Subordination Agent (i) shall deliver a Notice for
Payment, as provided in the Policy (for payment into the Policy Account) in an
amount sufficient to enable the Subordination Agent to pay the amount of such
reduction plus such accrued interest and (ii) shall pay such amount from the
Policy Account to the Class G Trustee in payment of such reduction in the
outstanding Pool Balance of the Class G Certificates plus such accrued interest
on such Special Distribution Date.
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(c) No Proceeds Drawing. On the first Business Day that is 24
months after the last date on which any payment was made on any Series G
Equipment Note as to which there has subsequently been a failure to pay
principal or that has subsequently been Accelerated, if the Subordination Agent
has not received a Special Payment constituting proceeds from the disposition of
that Equipment Note or the related Trust Indenture Estate or Collateral, as the
case may be, then the Subordination Agent shall deliver a Notice for Payment, as
provided in the Policy, to the Policy Provider or its fiscal agent, requesting a
Policy Drawing under the Policy (for payment into the Policy Account) in an
amount equal to the then outstanding principal amount of such Equipment Note
plus accrued interest thereon at the Stated Interest Rate for the Class G
Certificates from the immediately preceding Regular Distribution Date to the
below referred to Special Distribution Date. The Subordination Agent shall
promptly, but not less than 25 days prior to such Business Day, send to the
Class G Trustee a Written Notice setting forth the non-receipt of any such
Special Payment and establishing such Business Day as the date for the
distribution of the proceeds of such Policy Drawing, which date shall constitute
a Special Distribution Date. No later than 1:00 p.m. (New York City time) on the
specified Special Distribution Date the Subordination Agent shall make the
specified Policy Drawing and upon its receipt of the proceeds thereof pay the
amount thereof from the Policy Account to the Class G Trustee in reduction of
the outstanding Pool Balance of the Class G Certificates together with such
accrued and unpaid interest thereon. For the avoidance of doubt, after the
payment in full of such amount under this Section 3.7(c), the Subordination
Agent shall have no right to make any further Policy Drawings under this Section
3.7(c) in respect of any subsequent sale or other disposition of such Equipment
Note.
Notwithstanding the foregoing, the Policy Provider has the
right at the end of any such 24-month period, so long as no Policy Provider
Default shall have occurred and be continuing, to elect (the "Policy Provider
Election") instead (a) to pay on such Special Distribution Date an amount equal
to any shortfall in the scheduled principal and interest that came due on such
Series G Equipment Note (without regard to the acceleration thereof) during such
24-month period (after giving effect to the application of funds received from
the Class G Liquidity Facility, the Class G Cash Collateral Account and any
Policy Drawings, in each case attributable to such interest), (b) thereafter, on
each Regular Distribution Date until the establishment of an Election
Distribution Date, to permit drawings under the Policy for an amount equal to
the scheduled principal and interest that were to become due on such Equipment
Note on the related payment date (without regard to any acceleration thereof)
and (c) (i) on any Business Day (which shall be a Special Distribution Date)
elected by the Policy Provider upon 20 days' Written Notice to the Subordination
Agent and the Class G Trustee to request the Subordination Agent, or (ii)
following either the occurrence and continuation of a Policy Provider Default or
the sale or other disposition of such Equipment Note or the related Trust
Indenture Estate or the Collateral, on any Business Day (which shall be a
Special Distribution Date) specified by the Subordination Agent upon 20 days'
Written Notice to the Class G Trustee (each such Business Day in the case of
clauses (i) and (ii) an "Election Distribution Date") to permit the
Subordination Agent, in each case, to make a Policy Drawing for an amount equal
to the then outstanding principal balance of such Equipment Note less any Policy
Drawings previously paid by the Policy Provider in respect of principal of such
Equipment Note and accrued interest on such amounts at the Stated Interest Rate
for the Class G Certificates from the immediately preceding Regular Distribution
Date to such Election Distribution Date (after giving effect to the application
of funds, if any, received from the Class G Liquidity Facility and the
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Class G Cash Collateral Account attributable to such interest) and without
derogation of the Policy Provider's continuing obligations for all previous
Policy Drawings that remain unpaid in respect of such Equipment Note. The
Subordination Agent shall make each such drawing referred to in this paragraph
under the Policy (for payment into the Policy Account) no later than 1:00 p.m.
(New York City time) on each such date and upon its receipt of the proceeds
thereof pay the amount thereof from the Policy Account to the Class G Trustee in
reduction of the outstanding Pool Balance of the Class G Certificates together
with such accrued and unpaid interest thereon.
In addition, regardless of whether or not the Policy Provider
makes a Policy Provider Election, the Policy Provider shall, at the end of such
24-month period, provide to the Trustees and each Liquidity Provider to the
extent not previously provided (a) an amended Policy (x) providing for the
payment to such Liquidity Provider of interest accruing on all outstanding
Drawings under such Liquidity Provider's Liquidity Facility together with
accrued interest thereon in respect of each respective Liquidity Facility from
and after the end of such 24-month period, (y) permitting each Liquidity
Provider when and as such interest becomes due under the applicable Liquidity
Facility to demand payment thereof directly from the Policy Provider under such
amended Policy (each such demand, an "Excess Interest Policy Drawing") and (z)
prohibiting any amendment or modification of such amended Policy without the
prior written consent of each Liquidity Provider and (b) a legal opinion to the
effect that the Policy as amended constitutes an enforceable obligation of the
Policy Provider. Each Liquidity Provider agrees to make such Excess Interest
Policy Drawings and that the proceeds thereof shall reduce pro tanto the
Liquidity Obligations owing to it.
(d) Final Policy Drawing. If on the Final Legal Distribution
Date of the Class G Certificates after giving effect to the subordination
provisions of this Agreement and to the application of any amounts received by
the Escrow Agent in the Class G Paying Agent Account in respect of accrued
interest on the Class G Deposits, any Drawing paid under the Class G Liquidity
Facility in respect of interest included in the Final Distributions and any
withdrawal of funds in the Class G Cash Collateral Account in respect of
interest included in the Final Distributions, the Subordination Agent does not
then have sufficient funds available on such date for the payment in full of the
Final Distributions (calculated as at such date but excluding any accrued and
unpaid premium) on the Class G Certificates then, prior to 1:00 p.m. (New York
City time) on such date the Subordination Agent shall: (i) deliver a Notice for
Payment, as provided in the Policy, to the Policy Provider or its fiscal agent,
requesting a Policy Drawing under the Policy (for payment into the Policy
Account) in an amount equal to the minimum amount sufficient to enable the
Subordination Agent to pay the Final Distributions (calculated as at such date
but excluding any accrued and unpaid premium) on the Class G Certificates, and
(ii) shall pay such amount from the Policy Account to the Class G Trustee in
payment of such amount on such date.
(e) Avoidance Drawings. If at any time the Subordination Agent
shall have actual knowledge of the issuance of any Order, the Subordination
Agent shall promptly give notice thereof to each Trustee, the Liquidity
Providers and the Policy Provider. The Subordination Agent shall thereupon
calculate the relevant Preference Amounts resulting therefrom and shall
promptly: (a) send to the Class G Trustee a Written Notice of such amount and
(b) prior to the expiration of the Policy, deliver to the Policy Provider or its
fiscal agent a Notice of Avoided Payment, together with a copy of the
documentation required by the Policy
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with respect thereto, requesting a Policy Drawing (for payment to the receiver,
conservator, debtor-in-possession or trustee in bankruptcy and/or to the
Subordination Agent for deposit into the Policy Account, as applicable) in an
amount equal to the amount of relevant Preference Amount. To the extent that any
portion of such Preference Amount is to be paid to the Subordination Agent, such
Written Notice shall also set the date for the distribution of such portion of
the proceeds of such Policy Drawing which date shall constitute a Special
Distribution Date and shall be the earlier of the third Business Day that
immediately precedes the expiration of the Policy and the Business Day that
immediately follows the 25th day after the date of such Written Notice. No later
than 1:00 p.m. (New York City time) on the specified Special Distribution Date,
the Subordination Agent shall make the specified Policy Drawing upon its receipt
of the proceeds thereof and pay the amount thereof from the Payment Account to
the Class G Trustee in reinstatement of the Preference Amount.
(f) Application of Policy Drawings. Notwithstanding anything
to the contrary contained in this Agreement (including, without limitation,
Sections 2.4, 3.2 and 3.3 hereof), all payments received by the Subordination
Agent in respect of a Policy Drawing (including, without limitation, that
portion, if any, of the proceeds of a Policy Drawing for any Preference Amount
that is to be paid to the Subordination Agent and not to any receiver,
conservator, debtor-in-possession or trustee in bankruptcy as provided in the
Policy) shall be promptly paid from the Payment Account to the Class G Trustee
for distribution to the Class G Certificateholders.
(g) Limitation to Outstanding Pool Balance. Notwithstanding
anything to the contrary in this Section 3.7, at no time shall the Subordination
Agent make any Policy Drawing under clause (b), (c) or (d) of this Section 3.7
in excess of the then outstanding Pool Balance of the Class G Certificates and
accrued and unpaid interest at the Stated Interest Rate on the Class G
Certificates. Nothing contained in this Intercreditor Agreement shall alter or
amend the liabilities, obligations, requirements or procedures of the Policy
Provider under the Policy and the Policy Provider shall not be obligated to make
payment except at the times and in the amounts and under the circumstances
expressly set forth in the Policy.
(h) Resubmission of Notice for Payment. If the Policy Provider
at any time informs the Subordination Agent in accordance with the Policy that a
Notice for Payment or Notice of Avoided Payment submitted by the Subordination
Agent does not meet the requirements of the Policy, the Subordination Agent
shall, as promptly as possible after being so informed, submit to the Policy
Provider an amended and revised Notice for Payment or Notice of Avoided Payment,
as the case may be, and shall pay to the Class G Trustee out of the Policy
Account the amount received pursuant to such amended or revised Notice for
Payment or Notice of Avoided Payment, as the case may be, when received.
ARTICLE IV
EXERCISE OF REMEDIES
SECTION 4.1. Directions from the Controlling Party. (a) (i)
Following the occurrence and during the continuation of an Indenture Default
under any Indenture, the Controlling Party shall direct the Subordination Agent,
which in turn shall direct the Loan
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Trustee under such Indenture, in the exercise of remedies available to the
holders of the Equipment Notes issued pursuant to such Indenture. Subject to the
Owner Trustees' and the Owner Participants' rights, if any, set forth in the
Indentures with respect to Leased Aircraft to purchase the Equipment Notes and
the provisions of the next paragraph, if the Equipment Notes issued pursuant to
any Indenture have been Accelerated following an Indenture Default with respect
thereto, the Controlling Party may sell, assign, contract to sell or otherwise
dispose of and deliver all (but not less than all) of such Equipment Notes to
any Person at public or private sale, at any location at the option of the
Controlling Party, all upon such terms and conditions as it may reasonably deem
advisable in accordance with applicable law.
(ii) Subject to the Owner Trustees' and the Owner Participants'
rights, if any, set forth in the Indentures with respect to Leased
Aircraft to purchase the Equipment Notes, and notwithstanding the
foregoing, so long as any Certificates remain Outstanding, during the
period ending on the date which is nine months after the earlier of (x)
the Acceleration of the Equipment Notes issued pursuant to any
Indenture or (y) the occurrence of an America West Bankruptcy Event,
without the consent of each Trustee, (A) no Aircraft subject to the
Lien of such Indenture or such Equipment Notes may be sold if the net
proceeds from such sale would be less than the Minimum Sale Price for
such Aircraft or such Equipment Notes, and (B) with respect to any
Leased Aircraft, the amount and payment dates of rentals payable by
America West under the Lease for such Aircraft may not be adjusted, if,
as a result of such adjustment, the discounted present value of all
such rentals would be less than 75% of the discounted present value of
the rentals payable by America West under such Lease before giving
effect to such adjustment, in each case, using the weighted average
interest rate of the Equipment Notes issued pursuant to such Indenture
as the discount rate.
(iii) At the request of the Controlling Party, the Subordination
Agent may from time to time during the continuance of an Indenture
Default (and before the occurrence of a Triggering Event) commission
LTV Appraisals with respect to the Aircraft subject to such Indenture.
(iv) After a Triggering Event occurs and any Equipment Note
becomes a Non-Performing Equipment Note, the Subordination Agent shall
obtain Appraisals with respect to all of the Aircraft (the "LTV
Appraisals") as soon as practicable and additional LTV Appraisals on or
prior to each anniversary of the date of such initial LTV Appraisals;
provided that if the Controlling Party reasonably objects to the
appraised value of the Aircraft shown in such LTV Appraisals, the
Controlling Party shall have the right to obtain or cause to be
obtained substitute LTV Appraisals (including any LTV Appraisals based
upon physical inspection of the Aircraft).
(b) The Controlling Party shall take such actions as it may
reasonably deem most effectual to complete the sale or other disposition of such
Aircraft or Equipment Notes. In addition, in lieu of any sale, assignment,
contract to sell or other disposition, the Controlling Party may maintain or
cause the Subordination Agent to maintain possession of such Equipment Notes and
continue to apply monies received in respect of such Equipment Notes in
accordance with Article III hereof. In addition, in lieu of such sale,
assignment, contract to sell or other disposition, or in lieu of such
maintenance of possession, the Controlling Party may, subject to
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the terms and conditions of the related Indenture, instruct the Loan Trustee
under such Indenture to foreclose on the Lien on the related Aircraft or to take
any other remedial action permitted under such Indenture or under any applicable
law.
SECTION 4.2. Remedies Cumulative. Each and every right, power
and remedy given to the Trustees, the Liquidity Providers, the Policy Provider,
the Controlling Party or the Subordination Agent specifically or otherwise in
this Agreement shall be cumulative and shall be in addition to every other
right, power and remedy herein specifically given or now or hereafter existing
at law, in equity or by statute, and each and every right, power and remedy
whether specifically herein given or otherwise existing may, subject always to
the terms and conditions hereof, be exercised from time to time and as often and
in such order as may be deemed expedient by any Trustee, any Liquidity Provider,
the Policy Provider, the Controlling Party or the Subordination Agent, as
appropriate, and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the
same time or thereafter any other right, power or remedy. No delay or omission
by any Trustee, any Liquidity Provider, the Policy Provider, the Controlling
Party or the Subordination Agent in the exercise of any right, remedy or power
or in the pursuit of any remedy shall impair any such right, power or remedy or
be construed to be a waiver of any default or to be an acquiescence therein.
SECTION 4.3. Discontinuance of Proceedings. In case any party
to this Agreement (including the Controlling Party in such capacity) shall have
instituted any Proceeding to enforce any right, power or remedy under this
Agreement by foreclosure, entry or otherwise, and such Proceeding shall have
been discontinued or abandoned for any reason or shall have been determined
adversely to the Person instituting such Proceeding, then and in every such case
each such party shall, subject to any determination in such Proceeding, be
restored to its former position and rights hereunder, and all rights, remedies
and powers of such party shall continue as if no such Proceeding had been
instituted.
SECTION 4.4. Right of Certificateholders to Receive Payments
Not to Be Impaired. Anything in this Agreement to the contrary notwithstanding
but subject to each Trust Agreement, the right of any Certificateholder,
Liquidity Provider or the Policy Provider, respectively, to receive payments
hereunder (including without limitation pursuant to Section 2.4, 3.2 or 3.3
hereof) when due, or to institute suit for the enforcement of any such payment
on or after the applicable Distribution Date, shall not be impaired or affected
without the consent of such Certificateholder, Liquidity Provider or Policy
Provider, respectively.
SECTION 4.5. Undertaking for Costs. In any Proceeding for the
enforcement of any right or remedy under this Agreement or in any Proceeding
against any Controlling Party or the Subordination Agent for any action taken or
omitted by it as Controlling Party or Subordination Agent, as the case may be, a
court in its discretion may require the filing by any party litigant in the suit
of an undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs, including reasonable attorneys' fees and expenses,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. The provisions of
this Section do not apply to a suit instituted by the Subordination Agent, a
Liquidity Provider, the Policy Provider or a Trustee or a suit by
Certificateholders holding more than 10% of the original principal amount of any
Class of Certificates.
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ARTICLE V
DUTIES OF THE SUBORDINATION AGENT;
AGREEMENTS OF TRUSTEES, ETC.
SECTION 5.1. Notice of Indenture Default or Triggering Event.
(a) In the event the Subordination Agent shall have actual knowledge of the
occurrence of an Indenture Default or a Triggering Event, as promptly as
practicable, and in any event within 10 days after obtaining knowledge thereof,
the Subordination Agent shall transmit by mail or courier to the Rating
Agencies, the Liquidity Providers, the Policy Provider and the Trustees notice
of such Indenture Default or Triggering Event, unless such Indenture Default or
Triggering Event shall have been cured or waived by the Controlling Party. For
all purposes of this Agreement, in the absence of actual knowledge on the part
of a Responsible Officer, the Subordination Agent shall not be deemed to have
knowledge of any Indenture Default or Triggering Event unless notified in
writing by one or more Trustees, one or more Liquidity Providers, or the Policy
Provider or one or more Certificateholders.
(b) Other Notices. The Subordination Agent will furnish to
each Liquidity Provider, the Policy Provider and each Trustee, promptly upon
receipt thereof, duplicates or copies of all reports, notices, requests,
demands, certificates, financial statements and other instruments furnished to
the Subordination Agent as registered holder of the Equipment Notes or otherwise
in its capacity as Subordination Agent to the extent the same shall not have
been otherwise directly distributed to such Liquidity Provider, Policy Provider
or Trustee, as applicable, pursuant to the express provision of any other
Operative Agreement.
SECTION 5.2. Indemnification. The Subordination Agent shall
not be required to take any action or refrain from taking any action under
Article IV hereof unless the Subordination Agent shall have been indemnified (to
the extent and in the manner reasonably satisfactory to the Subordination Agent)
against any liability, cost or expense (including counsel fees and expenses)
which may be incurred in connection therewith. The Subordination Agent shall not
be under any obligation to take any action under this Agreement and nothing
contained in this Agreement shall require the Subordination Agent to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or powers
if it shall have reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not reasonably assured
to it. The Subordination Agent shall not be required to take any action under
Article IV hereof, nor shall any other provision of this Agreement be deemed to
impose a duty on the Subordination Agent to take any action, if the
Subordination Agent shall have been advised by counsel that such action is
contrary to the terms hereof or is otherwise contrary to law.
SECTION 5.3. No Duties Except as Specified in Intercreditor
Agreement. The Subordination Agent shall not have any duty or obligation to take
or refrain from taking any action under, or in connection with, this Agreement,
except as expressly provided by the terms of this Agreement; and no implied
duties or obligations shall be read into this Agreement against the
Subordination Agent. The Subordination Agent agrees that it will, in its
individual capacity and at its own cost and expense (but without any right of
indemnity in respect of any such cost or
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expense under Section 7.1 hereof) promptly take such action as may be necessary
to duly discharge all Liens on any of the Trust Accounts or any monies deposited
therein which result from claims against it in its individual capacity not
related to its activities hereunder or any other Operative Agreement.
SECTION 5.4. Notice from the Liquidity Providers and Trustees.
If any Liquidity Provider or any Trustee has notice of an Indenture Default or a
Triggering Event, such Person shall promptly give notice thereof to all other
Liquidity Providers, the Policy Provider and Trustees and to the Subordination
Agent, provided, however, that no such Person shall have any liability hereunder
as a result of its failure to deliver any such notice.
ARTICLE VI
THE SUBORDINATION AGENT
SECTION 6.1. Authorization; Acceptance of Trusts and Duties.
Each of the Class G Trustee and the Class C Trustee hereby designates and
appoints the Subordination Agent as the agent and trustee of such Trustee under
the applicable Liquidity Facility (and, in the case of the Class G Trustee, the
Policy Provider Agreement) and authorizes the Subordination Agent to enter into
the applicable Liquidity Facility (and, in the case of the Class G Trustee, the
Policy Provider Agreement) as agent and trustee for such Trustee. Each of the
Liquidity Providers, the Policy Provider and the Trustees hereby designates and
appoints the Subordination Agent as the Subordination Agent under this
Agreement. WTC hereby accepts the duties hereby created and applicable to it as
the Subordination Agent and agrees to perform the same but only upon the terms
of this Agreement and agrees to receive and disburse all monies received by it
in accordance with the terms hereof. The Subordination Agent shall not be
answerable or accountable under any circumstances, except (a) for its own
willful misconduct or gross negligence (or ordinary negligence in the handling
of funds), (b) as provided in Sections 2.2 and 5.3 hereof and (c) for
liabilities that may result from the inaccuracy of any representation or
warranty of the Subordination Agent made in its individual capacity in any
Operative Agreement. The Subordination Agent shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the Subordination
Agent, unless it is proved that the Subordination Agent was negligent in
ascertaining the pertinent facts.
SECTION 6.2. Absence of Duties. The Subordination Agent shall
have no duty to see to any recording or filing of this Agreement or any other
document, or to see to the maintenance of any such recording or filing.
SECTION 6.3. No Representations or Warranties as to Documents.
The Subordination Agent in its individual capacity does not make nor shall be
deemed to have made any representation or warranty as to the validity, legality
or enforceability of this Agreement or any other Operative Agreement or as to
the correctness of any statement contained in any thereof, except for the
representations and warranties of the Subordination Agent, made in its
individual capacity, under any Operative Agreement to which it is a party. The
Certificateholders, the Trustees, the Liquidity Providers and the Policy
Provider make no representation or warranty hereunder whatsoever.
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SECTION 6.4. No Segregation of Monies; No Interest. Any monies
paid to or retained by the Subordination Agent pursuant to any provision hereof
and not then required to be distributed to any Trustee or any Liquidity Provider
as provided in Articles II and III hereof or deposited into one or more Trust
Accounts need not be segregated in any manner except to the extent required by
such Articles II and III and by law, and the Subordination Agent shall not
(except as otherwise provided in Section 2.2 hereof) be liable for any interest
thereon; provided, however, that any payments received or applied hereunder by
the Subordination Agent shall be accounted for by the Subordination Agent so
that any portion thereof paid or applied pursuant hereto shall be identifiable
as to the source thereof.
SECTION 6.5. Reliance; Agents; Advice of Counsel. The
Subordination Agent shall not incur liability to anyone in acting upon any
signature, instrument, notice, resolution, request, consent, order, certificate,
report, opinion, bond or other document or paper believed by it to be genuine
and believed by it to be signed by the proper party or parties. As to the Pool
Balance of any Trust as of any date, the Subordination Agent may for all
purposes hereof rely on a certificate signed by any Responsible Officer of the
applicable Trustee, and such certificate shall constitute full protection to the
Subordination Agent for any action taken or omitted to be taken by it in good
faith in reliance thereon. As to any fact or matter relating to the Liquidity
Providers, the Policy Provider or the Trustees the manner of ascertainment of
which is not specifically described herein, the Subordination Agent may for all
purposes hereof rely on a certificate, signed by any Responsible Officer of the
applicable Liquidity Provider, Policy Provider or Trustee, as the case may be,
as to such fact or matter, and such certificate shall constitute full protection
to the Subordination Agent for any action taken or omitted to be taken by it in
good faith in reliance thereon. The Subordination Agent shall assume, and shall
be fully protected in assuming, that each of the Liquidity Providers, the Policy
Provider and each of the Trustees are authorized to enter into this Agreement
and to take all action to be taken by them pursuant to the provisions hereof,
and shall not inquire into the authorization of each of the Liquidity Providers,
the Policy Providers and Trustees with respect thereto. In the administration of
the trusts hereunder, the Subordination Agent may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or through
agents or attorneys and may consult with counsel, accountants and other skilled
persons to be selected and retained by it, and the Subordination Agent shall not
be liable for the acts or omissions of any agent appointed with due care or for
anything done, suffered or omitted in good faith by it in accordance with the
advice or written opinion of any such counsel, accountants or other skilled
persons.
SECTION 6.6. Capacity in Which Acting. The Subordination Agent
acts hereunder solely as agent and trustee herein and not in its individual
capacity, except as otherwise expressly provided in the Operative Agreements.
SECTION 6.7. Compensation. The Subordination Agent shall be
entitled to reasonable compensation, including reimbursement for reasonable
expenses and disbursements, except with respect to any Unindemnified Taxes
incurred by the Subordination Agent in connection with the transactions
contemplated by this Agreement for all services rendered hereunder and shall
have a priority claim to the extent set forth in Article III hereof on all
monies collected hereunder for the payment of such compensation (other than any
Unindemnified Taxes), to the extent that such compensation shall not be paid by
others. The Subordination Agent agrees that it shall have no right against any
Trustee, Liquidity Provider or the Policy
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Provider for any fee as compensation for its services as agent under this
Agreement. The provisions of this Section 6.7 shall survive the termination of
this Agreement.
SECTION 6.8. May Become Certificateholder. The institution
acting as Subordination Agent hereunder may become a Certificateholder and have
all rights and benefits of a Certificateholder to the same extent as if it were
not the institution acting as the Subordination Agent.
SECTION 6.9. Subordination Agent Required; Eligibility. There
shall at all times be a Subordination Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any State or the District of Columbia having a combined capital
and surplus of at least $100,000,000 (or the obligations of which, whether now
in existence or hereafter incurred, are fully and unconditionally guaranteed by
a corporation organized and doing business under the laws of the United States
of America, any State thereof or of the District of Columbia and having a
combined capital and surplus of at least $100,000,000), if there is such an
institution willing and able to perform the duties of the Subordination Agent
hereunder upon reasonable or customary terms. Such corporation shall be a
citizen of the United States and shall be authorized under the laws of the
United States or any State thereof or of the District of Columbia to exercise
corporate trust powers and shall be subject to supervision or examination by
federal, state or District of Columbia authorities. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of any of the aforesaid supervising or examining authorities, then,
for the purposes of this Section 6.9, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.
In case at any time the Subordination Agent shall cease to be
eligible in accordance with the provisions of this Section, the Subordination
Agent shall resign immediately in the manner and with the effect specified in
Section 8.1.
SECTION 6.10. Money to Be Held in Trust. All Equipment Notes,
monies and other property deposited with or held by the Subordination Agent
pursuant to this Agreement shall be held in trust for the benefit of the parties
entitled to such Equipment Notes, monies and other property. All such Equipment
Notes, monies or other property shall be held in the Trust Department of the
institution acting as Subordination Agent hereunder.
ARTICLE VII
INDEMNIFICATION OF SUBORDINATION AGENT
SECTION 7.1. Scope of Indemnification. The Subordination Agent
shall be indemnified hereunder to the extent and in the manner described in
Section 9.1 of the Participation Agreements and Section 6 of the Note Purchase
Agreement. The indemnities contained in such Sections of such agreements shall
survive the resignation or removal of the Subordination Agent and the
termination of this Agreement.
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ARTICLE VIII
SUCCESSOR SUBORDINATION AGENT
SECTION 8.1. Replacement of Subordination Agent; Appointment
of Successor. The Subordination Agent may resign at any time by so notifying
each Trustee, each Liquidity Provider and the Policy Provider. The Controlling
Party may remove the Subordination Agent for cause by so notifying the
Subordination Agent and may appoint a successor Subordination Agent. The
Controlling Party shall remove the Subordination Agent if:
(1) the Subordination Agent fails to comply with Section 6.9
hereof;
(2) the Subordination Agent is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the
Subordination Agent or its property; or
(4) the Subordination Agent otherwise becomes incapable of
acting.
If the Subordination Agent resigns or is removed or if a
vacancy exists in the office of Subordination Agent for any reason (the
Subordination Agent in such event being referred to herein as the retiring
Subordination Agent), the Controlling Party shall promptly appoint a successor
Subordination Agent.
A successor Subordination Agent shall deliver (x) a written
acceptance of its appointment as Subordination Agent hereunder to the retiring
Subordination Agent and (y) a written assumption of its obligations hereunder
and under each Liquidity Facility and the Policy Provider Agreement to each
party hereto, upon which the resignation or removal of the retiring
Subordination Agent shall become effective, and the successor Subordination
Agent shall have all the rights, powers and duties of the Subordination Agent
under this Agreement. The successor Subordination Agent shall mail a notice of
its succession to the Liquidity Providers, the Policy Provider and the Trustees.
The retiring Subordination Agent shall promptly transfer its rights under each
of the Liquidity Facilities and all of the property held by it as Subordination
Agent to the successor Subordination Agent.
If a successor Subordination Agent does not take office within
60 days after the retiring Subordination Agent resigns or is removed, the
retiring Subordination Agent or one or more of the Trustees may petition any
court of competent jurisdiction for the appointment of a successor Subordination
Agent.
If the Subordination Agent fails to comply with Section 6.9
hereof (to the extent applicable), one or more of the Trustees, one or more of
the Liquidity Providers or the Policy Provider may petition any court of
competent jurisdiction for the removal of the Subordination Agent and the
appointment of a successor Subordination Agent.
Notwithstanding the foregoing, no resignation or removal of
the Subordination Agent shall be effective unless and until a successor has been
appointed. No appointment of a
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successor Subordination Agent shall be effective unless and until the Rating
Agencies shall have delivered a Ratings Confirmation.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS
SECTION 9.1. Amendments, Waivers, etc. (a) This Agreement may
not be supplemented, amended or modified without the consent of each Trustee
(acting, except in the case of any amendment pursuant to Section 3.6(e)(v)(y)
hereof with respect to any Replacement Liquidity Facility, or any amendment
contemplated by the last sentence of this Section 9.1(a) or 9.1(c), with the
consent of holders of Certificates of the related Class evidencing interests in
the related Trust aggregating not less than a majority in interest in such Trust
or as otherwise authorized pursuant to the relevant Trust Agreement), the
Subordination Agent, each Liquidity Provider and the Policy Provider; provided,
however, that this Agreement may be supplemented, amended or modified without
the consent of (x) any Trustee if such supplement, amendment or modification (i)
is in accordance with Section 9.1(c) hereof or (ii) cures an ambiguity or
inconsistency or does not materially adversely affect such Trustee or the
holders of the related Class of Certificates and (y) any Liquidity Provider or
the Policy Provider if such supplement, amendment or modification is in
accordance with Section 9.1(c) hereof; provided further, however, that, if such
supplement, amendment or modification (A) would (x) directly or indirectly
modify or supersede, or otherwise conflict with, Section 2.2(b), Section 3.6(e),
Section 3.6(f), Section 3.6(l), the last sentence of this Section 9.1(a),
Section 9.1(c), the second sentence of Section 10.6 or this proviso
(collectively, the "America West Provisions") or (y) otherwise adversely affect
the interests of a potential Replacement Liquidity Provider or of America West
with respect to its ability to replace any Liquidity Facility or with respect to
its payment obligations under any Operative Agreement or (B) is made pursuant to
the last sentence of this Section 9.1(a) or pursuant to Section 9.1(c), then
such supplement, amendment or modification shall not be effective without the
additional written consent of America West. Notwithstanding the foregoing,
without the consent of each Certificateholder and each Liquidity Provider and
the Policy Provider, no supplement, amendment or modification of this Agreement
may (i) reduce the percentage of the interest in any Trust evidenced by the
Certificates issued by such Trust necessary to consent to modify or amend any
provision of this Agreement or to waive compliance therewith or (ii) except as
provided in Section 9.1(c) or the last sentence of this Section 9.1(a), modify
Section 2.4, 3.2 or 3.3 hereof, relating to the distribution of monies received
by the Subordination Agent hereunder from the Equipment Notes or pursuant to the
Liquidity Facilities or the Policy. Nothing contained in this Section shall
require the consent of a Trustee at any time following the payment of Final
Distributions with respect to the related Class of Certificates. If the
Replacement Liquidity Facility for any Liquidity Facility in accordance with
Section 3.6(e) hereof is to be comprised of more than one instrument as
contemplated by the definition of the term "Replacement Liquidity Facility",
then each of the parties hereto agrees to amend this Agreement to incorporate
appropriate mechanics for multiple Liquidity Facilities for an individual Trust.
(b) In the event that the Subordination Agent, as the
registered holder of any Equipment Notes, receives a request for its consent to
any amendment, modification, consent or waiver under such Equipment Notes, the
Indenture pursuant to which such Equipment Notes
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were issued, or the related Lease, Participation Agreement or other related
document, (i) if no Indenture Default shall have occurred and be continuing with
respect to such Indenture, the Subordination Agent shall request directions from
the Trustee of the Trust which holds each series of such Equipment Notes and
shall vote or consent in accordance with the directions of such Trustee except
that so long as the Final Distribution on the Class G Certificates has not been
made or any Policy Provider Obligations remain outstanding and no Policy
Provider Default shall have occurred and be continuing, the Subordination Agent
shall request directions from the Policy Provider rather than the Class G
Trustee with respect to the Series G Equipment Notes held in the Class G Trust,
and (ii) if any Indenture Default (which, in the case of any Indenture
pertaining to a Leased Aircraft, has not been cured by the applicable Owner
Trustee or the applicable Owner Participant, if applicable, pursuant to Section
4.03 of such Indenture) shall have occurred and be continuing with respect to
such Indenture, the Subordination Agent will exercise its voting rights as
directed by the Controlling Party, subject to Sections 4.1 and 4.4 hereof;
provided that no such amendment, modification or waiver shall, without the
consent of each Liquidity Provider and the Policy Provider, reduce the amount of
rent, supplemental rent or stipulated loss values payable by America West under
any Lease or reduce the amount of principal or interest payable by America West
under any Equipment Note issued under any Indenture in respect of an Owned
Aircraft.
(c) If with respect to any Aircraft Class D Certificates are
issued, this Agreement shall be amended by written agreement of America West and
the Subordination Agent to provide for the subordination of such Class D
Certificates to the Class G Certificates and the Class C Certificates
substantially in the same manner as the Class C Certificates are subordinated
hereunder to the Class G Certificates. No such amendment shall materially
adversely affect any Trustee, the Liquidity Provider or the Policy Provider. The
amendment to this Agreement to give effect to the issuance of any Class C
Certificates shall include, without limitation:
(i) the trustee of the Class D Trust shall be added as a party
to this Agreement;
(ii) the definitions of "Cash Collateral Account,"
"Certificate," "Class," "Equipment Notes," "Final Legal Distribution
Date," "Liquidity Facilities," "Liquidity Provider," "LTV Ratio,"
"Stated Interest Rate," "Trust," "Trust Agreement," "Controlling Party"
shall be revised, as appropriate, to reflect the issuance of the Class
D Certificates (and the subordination thereof); and
(iii) the provisions of this Agreement governing payments with
respect to Certificates and related notices, including, without
limitation, Sections 2.4, 3.1, 3.2, 3.3 and 3.6(e), shall be revised to
provide for distributions on the Class D Certificates after payment of
all relevant distributions on the Class C Certificates.
If, with respect to any Aircraft, Series D Equipment Notes are
issued to any Person other than the Class D Trust, this Agreement shall be
amended by written agreement of America West and the Subordination Agent to (i)
provide for each holder of a Series D Equipment Note to be bound by the
provisions of Section 2.6(a) hereof so that the Controlling Party shall, among
other things, be entitled to direct the Loan Trustee as provided therein (and
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such Series D Equipment Notes shall make effective provision therefor so as to
bind each holder thereof to such provisions of Section 2.6(a) hereof) and (ii)
to revise the definitions of "Controlling Party" and "Equipment Notes", as
appropriate, to reflect the issuance of the Series D Equipment Notes (and the
prior rights, as against the holders of such Series D Equipment Notes, of the
Policy Provider, Class G Trustee and the Class C Trustee to be such "Controlling
Party"). No such amendment shall materially adversely affect any Trustee,
Liquidity Provider or the Policy Provider.
SECTION 9.2. Subordination Agent Protected. If, in the
reasonable opinion of the institution acting as the Subordination Agent
hereunder, any document required to be executed pursuant to the terms of Section
9.1 adversely affects any right, duty, immunity or indemnity with respect to it
under this Agreement, any Liquidity Facility or the Policy, the Subordination
Agent may in its discretion decline to execute such document.
SECTION 9.3. Effect of Supplemental Agreements. Upon the
execution of any amendment, consent or supplement hereto pursuant to the
provisions hereof, this Agreement shall be and be deemed to be and shall be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Agreement
of the parties hereto and beneficiaries hereof shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental
agreement shall be and be deemed to be and shall be part of the terms and
conditions of this Agreement for any and all purposes. In executing or accepting
any supplemental agreement permitted by this Article IX, the Subordination Agent
shall be entitled to receive at its cost, and shall be fully protected in
relying upon, an opinion of counsel stating that the execution of such
supplemental agreement is authorized or permitted by this Agreement.
SECTION 9.4. Notice to Rating Agencies. Promptly following its
receipt of each amendment, consent, modification, supplement or waiver
contemplated by this Article IX, the Subordination Agent shall send a copy
thereof to each Rating Agency.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Termination of Intercreditor Agreement.
Following payment of Final Distributions with respect to each Class of
Certificates and the payment in full of all Liquidity Obligations to the
Liquidity Providers and all Policy Provider Obligations to the Policy Provider
and provided that there shall then be no other amounts due to the
Certificateholders, the Trustees, the Liquidity Providers, the Policy Provider
and the Subordination Agent hereunder or under the Trust Agreements, and that
the commitment of the (i) Liquidity Providers under the Liquidity Facilities and
(ii) Policy Provider under the Policy shall have expired or been terminated,
this Agreement and the trusts created hereby shall terminate and this Agreement
shall be of no further force or effect. Except as aforesaid or otherwise
provided, this Agreement and the trusts created hereby shall continue in full
force and effect in accordance with the terms hereof.
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SECTION 10.2. Intercreditor Agreement for Benefit of Trustees,
Liquidity Providers, the Policy Provider and Subordination Agent. Subject to the
second sentence of Section 10.6 and the provisions of Sections 4.4 and 9.1,
nothing in this Agreement, whether express or implied, shall be construed to
give to any Person other than the Trustees, the Liquidity Providers, the Policy
Provider and the Subordination Agent any legal or equitable right, remedy or
claim under or in respect of this Agreement.
SECTION 10.3. Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all notices, requests, demands, authorizations,
directions, consents, waivers or documents provided or permitted by this
Agreement to be made, given, furnished or filed shall be in writing, mailed by
certified mail, postage prepaid, or by confirmed telecopy and
(i) if to the Subordination Agent, addressed to at its
office at:
WILMINGTON TRUST COMPANY
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to any Trustee, addressed to it at its office at:
WILMINGTON TRUST COMPANY
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(iii) if to the initial Liquidity Provider, addressed to it
at its office at:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL SERVICES, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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(iv) if to the initial Policy Provider, addressed to it at
its office at:
Ambac Assurance Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Surveillance Department
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Attention: General Counsel - Urgent
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Whenever any notice in writing is required to be given by any Trustee, Liquidity
Provider, Policy Provider or the Subordination Agent to any of the other of
them, such notice shall be deemed given and such requirement satisfied when such
notice is received unless received outside of business hours, in which case on
the open of business on the next Business Day. A copy of any notice given by the
Trustee, the Liquidity Provider or the Subordination Agent shall be given to the
Policy Provider; provided that the failure to do so shall not impair the
validity of any such notice or the Policy Provider's obligations hereunder and
under the Policy. Any party hereto may change the address to which notices to
such party will be sent by giving notice of such change to the other parties to
this Agreement.
SECTION 10.4. Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 10.5. No Oral Modifications or Continuing Waivers. No
terms or provisions of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party or
other Person against whom enforcement of the change, waiver, discharge or
termination is sought and any other party or other Person whose consent is
required pursuant to this Agreement and any waiver of the terms hereof shall be
effective only in the specific instance and for the specific purpose given.
SECTION 10.6. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
each of the parties hereto and the successors and assigns of each, all as herein
provided. In addition, the America West Provisions shall inure to the benefit of
America West and its successors and assigns, and (without limitation of the
foregoing) America West is hereby constituted, and agreed to be, an express
third party beneficiary of the America West Provisions. Upon the occurrence of
the Transfers contemplated by the Assignment and Assumption Agreements, the
Trustee of each Class shall (without any further act) be deemed to have
transferred all of its rights, title and interest in and to this Agreement to
the trustee of the Successor Trust of the same Class and, thereafter, the
trustee of each Successor Trust shall be deemed to be the "Trustee" of such
Successor Trust with the rights and obligations of a "Trustee" hereunder and
under the other
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Operative Agreements and each reference to a Trust of any Class herein shall be
deemed a reference to the Successor Trust of such Class.
SECTION 10.7. Headings. The headings of the various Articles
and Sections herein and in the table of contents hereto are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
SECTION 10.8. Counterpart Form. This Agreement may be executed
by the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute but one and the same agreement.
SECTION 10.9. Subordination. (a) As between the Liquidity
Providers and the Policy Provider, on the one hand, and the Trustees and the
Certificateholders, on the other hand, and as among the Trustees, this Agreement
shall be a subordination agreement for purposes of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ Bankruptcy Code, as amended from time to time.
(b) Notwithstanding the provisions of this Agreement, if prior
to the payment in full to the (i) Liquidity Providers of all Liquidity
Obligations then due and payable and (ii) Policy Provider of all Policy Provider
Obligations then due and payable, any party hereto shall have received any
payment or distribution in respect of Equipment Notes or any other amount under
the Indentures or other Operative Agreements which, had the subordination
provisions of this Agreement been properly applied to such payment, distribution
or other amount, would not have been distributed to such Person, then such
payment, distribution or other amount shall be received and held in trust by
such Person and paid over or delivered to the Subordination Agent for
application as provided herein.
(c) If any Trustee, any Liquidity Provider, the Policy
Provider or the Subordination Agent receives any payment in respect of any
obligations owing hereunder (or, in the case of the Liquidity Providers or the
Policy Provider, in respect of the Liquidity Obligations or the Policy Provider
Obligations, as the case may be), which is subsequently invalidated, declared
preferential, set aside and/or required to be repaid to a trustee, receiver or
other party, then, to the extent of such payment, such obligations (or, in the
case of the Liquidity Providers or the Policy Provider, such Liquidity
Obligations or Policy Provider Obligations, as the case may be) intended to be
satisfied shall be revived and continue in full force and effect as if such
payment had not been received.
(d) The Trustees (on behalf of themselves and the holders of
Certificates), the Liquidity Providers, the Policy Provider and the
Subordination Agent confirm that the payment priorities specified in Sections
2.4, 3.2 and 3.3 shall apply in all circumstances, notwithstanding the fact that
the obligations owed to the Trustees and the holders of Certificates are secured
by certain assets and the Liquidity Obligations and Policy Provider Obligations
may not be so secured. The Trustees expressly agree (on behalf of themselves and
the holders of Certificates) not to assert priority over the holders of
Liquidity Obligations or Policy Provider Obligations (except as specifically set
forth in Sections 2.4, 3.2 or 3.3) due to their status as secured creditors in
any bankruptcy, insolvency or other legal proceeding.
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(e) Each of the Trustees (on behalf of themselves and the
holders of Certificates), the Liquidity Providers, the Policy Provider and the
Subordination Agent may take any of the following actions without impairing its
rights under this Agreement:
(i) obtain a Lien on any property to secure any amounts
owing to it hereunder, including, in the case of the Liquidity
Providers and the Policy Provider, the Liquidity Obligations or the
Policy Provider Obligations, as the case may be,
(ii) obtain the primary or secondary obligation of any other
obligor with respect to any amounts owing to it hereunder, including,
in the case of the Liquidity Providers and the Policy Provider, any of
the Liquidity Obligations or the Policy Provider Obligations, as the
case may be,
(iii) renew, extend, increase, alter or exchange any amounts
owing to it hereunder, including, in the case of the Liquidity
Providers and the Policy Provider, any of the Liquidity Obligations or
the Policy Provider Obligations, as the case may be, or release or
compromise any obligation of any obligor with respect thereto,
(iv) refrain from exercising any right or remedy, or delay
in exercising such right or remedy, which it may have, or
(v) take any other action which might discharge a
subordinated party or a surety under applicable law;
provided, however, that the taking of any such actions by any of the Trustees,
the Liquidity Providers, the Policy Provider or the Subordination Agent shall
not prejudice the rights or adversely affect the obligations of any other party
under this Agreement.
SECTION 10.10. Governing Law. THIS AGREEMENT SHALL IN ALL
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE
OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
SECTION 10.11. Submission to Jurisdiction; Waiver of Jury
Trial; Waiver of Immunity. (a) Each of the parties hereto hereby irrevocably and
unconditionally:
(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;
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(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 of mail), postage
prepaid, to each party hereto at its address set forth in Section 10.3
hereof, or at such other address of which the other parties 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) EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS
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. Each of the parties
warrants and represents 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.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, as of the day and year first above written, and acknowledge that
this Agreement has been made and delivered in the City of New York, and this
Agreement has become effective only upon such execution and delivery.
WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Trustee
for each of the Trusts
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CAPITAL
SERVICES, INC., as Class
G Liquidity Provider and
Class C Liquidity
Provider
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
AMBAC ASSURANCE CORPORATION,
as Policy Provider
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President Financial Institutions
WILMINGTON TRUST COMPANY, not in its
individual capacity except as expressly
set forth herein but solely as
Subordination Agent and trustee
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President