EXHIBIT 4.8
PARTICIPATION AGREEMENT
(N3760C)
Dated as of January 30, 2003
among
DELTA AIR LINES, INC.,
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Pass Through Trustee under each of the
Pass Through Trust Agreements
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Subordination Agent
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Loan Trustee
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
in its individual capacity as set forth herein
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One Boeing 737-832 Aircraft
U.S. Registration No. N3760C
TABLE OF CONTENTS
Page
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ARTICLE 1
DEFINITIONS
Section 1.01 Definitions...................................................................................2
Section 1.02 Other Definitional Provisions.................................................................2
ARTICLE 2
THE LOANS
Section 2.01 The Loans.....................................................................................2
Section 2.02 Issuance of Equipment Notes...................................................................2
Section 2.03 The Closing...................................................................................3
ARTICLE 3
CONDITIONS PRECEDENT
Section 3.01 Conditions Precedent to Obligations of Pass Through Trustees..................................3
Section 3.02 Conditions Precedent to Obligations of Company................................................6
ARTICLE 4
REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF COMPANY
Section 4.01 Representations and Warranties of Company.....................................................7
Section 4.02 General Indemnity.............................................................................9
ARTICLE 5
REPRESENTATIONS, WARRANTIES AND COVENANTS OF U.S. BANK
Section 5.01 Representations, Warranties and Covenants of U.S. Bank.......................................14
ARTICLE 6
OTHER COVENANTS AND AGREEMENTS
Section 6.01 Other Agreements.............................................................................16
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Section 6.02 Certain Covenants of Company.................................................................18
ARTICLE 7
MISCELLANEOUS
Section 7.01 Notices......................................................................................20
Section 7.02 Survival of Representations, Warranties, Indemnities, Covenants and Agreements...............21
Section 7.03 Governing Law................................................................................21
Section 7.04 Severability.................................................................................21
Section 7.05 No Oral Modifications or Continuing Waivers; Consents........................................21
Section 7.06 Effect of Headings and Table of Contents.....................................................21
Section 7.07 Successors and Assigns.......................................................................21
Section 7.08 Benefits of Agreement........................................................................22
Section 7.09 Counterparts.................................................................................22
Section 7.10 Submission to Jurisdiction...................................................................22
Schedule I - Equipment Notes, Purchasers and Original Principal Amounts
Schedule II - Trust Supplements
Schedule III - Excess Amount
Exhibit A-1 - Form of Opinion of Counsel for Company
Exhibit A-2 - Form of Opinion of Cadwalader, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, special counsel for Company
Exhibit A-3 - Form of ss. 1110 Opinion of Cadwalader, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, special counsel for Company
Exhibit B - Form of Opinion of Special Counsel for Loan Trustee, Subordination Agent and U.S. Bank
Exhibit C - Form of Opinion of Special FAA Counsel
Exhibit D-1 - Form of Opinion of Special Counsel for Primary Liquidity Provider
Exhibit D-2 - Form of Opinion of German In-House Counsel for Primary Liquidity Provider
Exhibit D-3 - Form of Opinion of In-House Counsel for Above Cap Liquidity Provider
Exhibit E - Form of Manufacturer's Consent
Exhibit F-1 - Form of Opinion of Special Counsel for Pass Through Trustees
Exhibit F-2 - Form of Opinion of Special Counsel for Pass Through Trustees
Exhibit G - Form of Opinion of In-House Counsel for Policy Provider
Annex A - Definitions
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PARTICIPATION AGREEMENT
(N3760C)
This PARTICIPATION AGREEMENT (N3760C), dated as of January 30,
2003, is made by and among DELTA AIR LINES, INC., a Delaware corporation
(together with its successors and permitted assigns, "Company"), U.S. BANK TRUST
NATIONAL ASSOCIATION, a national banking association (in its individual
capacity, together with its successors and permitted assigns, "U.S. Bank"), not
in its individual capacity except as otherwise expressly provided in any of the
Operative Documents or the Pass Through Documents, but solely as trustee (in
such capacity together with any successor or other trustee in such capacity,
"Pass Through Trustee") under each of the Pass Through Trust Agreements (such
term and other capitalized terms used herein without definition being defined as
provided in Section 1.01), U.S. BANK TRUST NATIONAL ASSOCIATION, a national
banking association, as subordination agent and trustee (in such capacity,
together with any successor trustee in such capacity, "Subordination Agent")
under the Intercreditor Agreement, and U.S. BANK TRUST NATIONAL ASSOCIATION, as
loan trustee (in such capacity, together with any successor trustee in such
capacity, "Loan Trustee") under the Indenture.
WITNESSETH:
WHEREAS, Company is the owner of that certain Boeing Model
737-832 aircraft more particularly described in the Indenture Supplement
originally executed and delivered under the Indenture;
WHEREAS, concurrently with the execution and delivery of this
Agreement, Company and Loan Trustee are entering into the Indenture, pursuant to
which, among other things, Company will issue three series of Equipment Notes,
which Equipment Notes are to be secured by a security interest in all right,
title and interest of Company in and to the Aircraft and certain other property
described in the Indenture;
WHEREAS, pursuant to the Basic Pass Through Trust Agreement
and each of the Trust Supplements set forth in Schedule II, concurrently with
the execution and delivery of this Agreement, separate Pass Through Trusts are
being created to facilitate certain of the transactions contemplated hereby,
including, without limitation, the issuance and sale of Pass Through
Certificates;
WHEREAS, pursuant to the Intercreditor Agreement,
Subordination Agent will hold the Equipment Notes on behalf of the Pass Through
Trusts;
NOW, THEREFORE, in consideration of the foregoing premises and
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 1
DEFINITIONS
Section 1.01 Definitions. For the purposes of this
Agreement, unless the context otherwise requires, capitalized terms used but not
defined herein have the respective meanings set forth or incorporated by
reference in Annex A.
Section 1.02 Other Definitional Provisions. (a) The
definitions stated herein and in Annex A apply equally to both the singular and
the plural forms of the terms defined.
(b) All references in this Agreement to designated
"Articles", "Sections", "Subsections", "Schedules", "Exhibits", "Annexes" and
other subdivisions are to the designated Article, Section, Subsection, Schedule,
Exhibit, Annex or other subdivision of this Agreement, unless otherwise
specifically stated.
(c) 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, Subsection, Schedule, Exhibit, Annex or other
subdivision.
(d) All references in this Agreement to a "government"
are to such government and any instrumentality or agency thereof.
(e) Unless the context otherwise requires, whenever the
words "including", "include" or "includes" are used herein, they shall be deemed
to be followed by the phrase "without limitation".
ARTICLE 2
THE LOANS
Section 2.01 The Loans. Subject to the terms and
conditions of this Agreement and the Indenture, on the Closing Date Pass Through
Trustee for each Pass Through Trust shall make a loan to Company by paying to
Company the aggregate original principal amounts of the Equipment Notes being
issued to such Pass Through Trust as set forth on Schedule I opposite the name
of such Pass Through Trust. Pass Through Trustees, on behalf of the Pass Through
Trusts, shall make such loans to Company no later than 11:00 a.m. (New York City
time) on the Closing Date by transferring such amount in immediately available
funds to Company at its account at Citibank, N.A., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇, Account No. ▇▇▇▇▇▇▇▇, ABA Number ▇▇▇▇▇▇▇▇▇, with the request that the
bank advise Company by telephone at (▇▇▇) ▇▇▇-▇▇▇▇ upon transfer of the funds.
Section 2.02 Issuance of Equipment Notes. Upon the
occurrence of the above payments by Pass Through Trustee for each Pass Through
Trust to Company, Company shall issue, pursuant to and in accordance with
Article II of the Indenture, to Subordination Agent as agent and trustee for
Pass Through Trustee for each Pass Through Trust, one or more Equipment Notes of
the maturity and aggregate principal amount set forth in Schedule I opposite the
name
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of such Pass Through Trust. Each such Equipment Note shall be duly authenticated
by Loan Trustee pursuant to the Indenture, registered in the name of
Subordination Agent and dated the Closing Date and shall be delivered by Loan
Trustee to Subordination Agent.
Section 2.03 The Closing. The closing (the "Closing") of
the transactions contemplated hereby shall take place at the offices of
Cadwalader, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 9:30 a.m.
(New York City time) on January 30, 2003, or at such other time or place as the
parties shall agree.
ARTICLE 3
CONDITIONS PRECEDENT
Section 3.01 Conditions Precedent to Obligations of Pass
Through Trustees. The obligation of each Pass Through Trustee to make the loan
contemplated by Article II is subject to the fulfillment (or the waiver by such
Pass Through Trustee) prior to or on the Closing Date of the following
conditions precedent:
(a) Company shall have tendered the Equipment Notes to
Loan Trustee for authentication, and Loan Trustee shall have authenticated such
Equipment Notes and shall have tendered the Equipment Notes to Subordination
Agent on behalf of the applicable Pass Through Trustee in accordance with
Section 2.02.
(b) No change shall have occurred after the date of this
Agreement in applicable law or regulations thereunder or interpretations thereof
by appropriate regulatory authorities or any court that would make it a
violation of law or governmental regulations for Pass Through Trustees to make
the loans contemplated by Section 2.01 or to acquire the Equipment Notes.
(c) This Agreement and the following documents shall have
been duly authorized, executed and delivered by the respective party or parties
thereto (other than Pass Through Trustees or Loan Trustee), shall be in full
force and effect and executed counterparts (or copies thereof where indicated)
thereof shall have been delivered to each Pass Through Trustee:
(i) the Intercreditor Agreement;
(ii) the Liquidity Facilities;
(iii) the Pass Through Trust Agreements;
(iv) the Indenture and the Indenture Supplement covering
the Aircraft and dated the Closing Date;
(v) the Manufacturer's Consent;
(vi) a copy of the FAA ▇▇▇▇ of Sale; and
(vii) a copy of the Warranty ▇▇▇▇ of Sale.
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(d) A Uniform Commercial Code financing statement or
statements covering the security interest created by the Indenture shall have
been executed and delivered by Company, as debtor, and by Loan Trustee, as
secured party, and such financing statement or statements shall have been duly
filed in all places necessary or desirable within the State of Delaware.
(e) Each Pass Through Trustee shall have received the
following:
(i) a certificate dated the Closing Date of the Secretary
or an Assistant Secretary of Company, certifying as to (A) a copy of
the resolutions of the Board of Directors of Company or the executive
committee thereof duly authorizing the transactions contemplated hereby
and the execution, delivery and performance by Company of this
Agreement and the Indenture and each other document required to be
executed and delivered by Company in accordance with the provisions
hereof or thereof and (B) a copy of the certificate of incorporation
and by-laws of Company, as in effect on the Closing Date;
(ii) a certificate or other evidence from the Secretary of
State of the State of Delaware, dated as of a date reasonably near the
Closing Date, as to the due incorporation and good standing of Company
in such state;
(iii) an incumbency certificate of Company as to the person
or persons authorized to execute and deliver this Agreement, the
Indenture and each other document to be executed by Company in
connection with the transactions contemplated hereby and thereby, and
the specimen signatures of such person or persons; and
(iv) one or more certificates of Loan Trustee and
Subordination Agent certifying to the reasonable satisfaction of Pass
Through Trustees as to the due authorization, execution, delivery and
performance by Loan Trustee and Subordination Agent of each of the
Operative Documents to which Loan Trustee or Subordination Agent is or
will be a party and any other documents to be executed by or on behalf
of Loan Trustee or Subordination Agent in connection with the
transactions contemplated hereby or thereby.
(f) On the Closing Date, the following statements shall
be correct: (i) the representations and warranties of Company herein are correct
in all material respects as though made on and as of such date, except to the
extent that such representations and warranties relate solely to an earlier date
(in which case such representations and warranties are correct on and as of such
earlier date) and (ii) no event has occurred and is continuing that constitutes
an Event of Default or an Event of Loss or would constitute an Event of Default
or Event of Loss but for the requirement that notice be given or time elapse or
both.
(g) Each Pass Through Trustee and Loan Trustee shall have
received (i) an opinion addressed to it from the General Counsel or an Associate
General Counsel of Company (or such other internal counsel to Company as shall
be reasonably satisfactory to Pass Through Trustees) substantially in the form
set forth in Exhibit A-1 and (ii) opinions addressed to it from Cadwalader,
▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇ substantially in the forms set forth in Exhibits A-2 and A-3.
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(h) Each Pass Through Trustee and Loan Trustee shall have
received an opinion addressed to it from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, special counsel
for U.S. Bank, Loan Trustee and Subordination Agent, substantially in the form
set forth in Exhibit B.
(i) Each Pass Through Trustee and Loan Trustee shall have
received an opinion addressed to it from Daugherty, Fowler, Peregrin & ▇▇▇▇▇▇, A
Professional Corporation, special FAA counsel in Oklahoma City, Oklahoma,
substantially in the form set forth in Exhibit C.
(j) Each Pass Through Trustee and Loan Trustee shall have
received a certificate or certificates signed by the chief financial or
accounting officer, any Senior Vice President, the Treasurer, any Vice President
or any Assistant Treasurer (or any other Responsible Officer) of Company, dated
the Closing Date, certifying as to the correctness of each of the matters stated
in Section 3.01(f).
(k) Each Pass Through Trustee shall have received a
certificate from U.S. Bank in its individual capacity and as Loan Trustee and
Subordination Agent, as applicable, dated the Closing Date, signed by an
authorized officer of U.S. Bank in its individual capacity and as Loan Trustee
and Subordination Agent, as applicable, certifying for each such entity that no
Loan Trustee Liens or Other Party Liens attributable to it, as applicable,
exist, and further certifying as to the correctness of each of the matters
stated in Section 5.01.
(l) Each Pass Through Trustee shall have received
opinions addressed to it from Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, special
counsel for Primary Liquidity Provider, substantially in the form set forth in
Exhibit D-1, from German in-house counsel for Primary Liquidity Provider,
substantially in the form set forth in Exhibit D-2, and from in-house counsel
for Above Cap Liquidity Provider substantially in the form set forth in Exhibit
D-3.
(m) Loan Trustee shall have received an insurance report
of an independent insurance broker and the related certificates of insurance,
each in form and substance reasonably satisfactory to Loan Trustee, as to the
compliance with the terms of Section 7.06 of the Indenture relating to insurance
with respect to the Aircraft.
(n) No action or proceeding shall have been instituted
nor shall governmental action be threatened before any court or governmental
agency, nor shall any order, judgment or decree have been issued or proposed to
be issued by any court or governmental agency at the time of the Closing to set
aside, restrain, enjoin or prevent the completion and consummation of this
Agreement or the transactions contemplated hereby.
(o) Company shall have entered into the Pass Through
Purchase Agreement, the Pass Through Certificates shall have been issued and
sold pursuant to the Pass Through Purchase Agreement and the Initial Purchasers
shall have transferred to Pass Through Trustees in immediately available funds
an amount at least equal to the aggregate purchase price of the Equipment Notes
to be purchased from Company.
(p) Loan Trustee shall have received an executed copy of
the Manufacturer's Consent substantially in the form set forth in Exhibit E.
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(q) Each Pass Through Trustee shall have received an
opinion from in-house counsel to the Policy Provider, substantially in the form
set forth in Exhibit G.
(r) All appropriate action required to have been taken
prior to the Closing Date by the FAA or any governmental or political agency,
subdivision or instrumentality of the United States, in connection with the
transactions contemplated by this Agreement has been taken, and all orders,
permits, waivers, authorizations, exemptions and approvals of such entities
required to be in effect on the Closing Date in connection with the transactions
contemplated by this Agreement have been issued.
Promptly upon the recording of the Indenture (with the
Indenture Supplement attached) pursuant to the Transportation Code, Company will
cause Daugherty, Fowler, Peregrin & ▇▇▇▇▇▇, A Professional Corporation, special
FAA counsel in Oklahoma City, Oklahoma to deliver to Subordination Agent, to
Pass Through Trustees, to Loan Trustee and to Company an opinion as to the due
recording of such instrument and the lack of filing of any intervening documents
with respect to the Aircraft.
Section 3.02 Conditions Precedent to Obligations of
Company. The obligation of Company to issue and sell the Equipment Notes is
subject to the fulfillment (or waiver by Company) prior to or on the Closing
Date of the following conditions precedent:
(a) No change shall have occurred after the date of this
Agreement in applicable law or regulations thereunder or interpretations thereof
by appropriate regulatory authorities or any court that would make it a
violation of law or governmental regulations for Company to enter into any
transaction contemplated by the Operative Documents or the Pass Through Trust
Agreements.
(b) The documents referred to in Section 3.01(c) shall
have been duly authorized, executed and delivered by the respective party or
parties thereto (other than Company), shall be in full force and effect and
executed counterparts (or copies thereof where indicated) thereof shall have
been delivered to Company, and Company shall have received such documents and
evidence with respect to U.S. Bank, Liquidity Providers, Policy Provider, Loan
Trustee, Subordination Agent and each Pass Through Trustee as Company reasonably
requests in order to establish the consummation of the transactions contemplated
by this Agreement, the taking of all corporate and other proceedings in
connection therewith and compliance with the conditions herein set forth.
(c) The Indenture (with the Indenture Supplement covering
the Aircraft attached) shall have been duly filed for recordation (or shall be
in the process of being so duly filed for recordation) with the FAA pursuant to
the Transportation Code.
(d) On the Closing Date, the representations and
warranties herein of U.S. Bank, Loan Trustee, Subordination Agent and Pass
Through Trustees shall be correct as though made on and as of such date, except
to the extent that such representations and warranties relate solely to an
earlier date (in which case such representations and warranties shall have been
correct on and as of such earlier date), and, insofar as such representations
and warranties
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concern U.S. Bank, Loan Trustee, Subordination Agent or any Pass Through
Trustee, such party shall have so certified to Company.
(e) Company shall have received each opinion referred to
in Subsections 3.01(h), 3.01(i), 3.01(l) and 3.01(q), each such opinion (other
than 3.01(l)) addressed to Company or accompanied by a letter from the counsel
rendering such opinion authorizing Company to rely on such opinion as if it were
addressed to Company, and the certificates referred to in Subsections
3.01(e)(iv) and 3.01(k).
(f) Company shall have received an opinion addressed to
it from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, special counsel for Pass Through Trustees,
substantially in the form set forth in Exhibit F-1 and from ▇▇▇▇ ▇▇▇▇▇ LLP,
special counsel for Pass Through Trustees, substantially in the form set forth
in Exhibit F-2.
(g) No action or proceeding shall have been instituted
nor shall governmental action be threatened before any court or governmental
agency, nor shall any order, judgment or decree have been issued or proposed to
be issued by any court or governmental agency at the time of the Closing to set
aside, restrain, enjoin or prevent the completion and consummation of this
Agreement or the transactions contemplated hereby.
(h) Company shall have received a certificate from U.S.
Bank dated the Closing Date, signed by an authorized officer of U.S. Bank,
certifying for each Pass Through Trustee that no Other Party Liens attributable
to it exist and further certifying as to the correctness of each of the matters
stated in Section 5.01.
(i) Company shall have been paid by Pass Through Trustee
for each Pass Through Trust the aggregate original principal amount of the
Equipment Notes being issued to such Pass Through Trust as set forth on Schedule
I opposite the name of such Pass Through Trust.
ARTICLE 4
REPRESENTATIONS, WARRANTIES AND INDEMNITIES OF COMPANY
Section 4.01 Representations and Warranties of Company.
Company represents and warrants that:
(a) Company is a corporation duly incorporated and
validly existing in good standing under the laws of the State of Delaware, is a
Certificated Air Carrier, is a Citizen of the United States, has the corporate
power and authority to own its properties or hold them under lease and to enter
into and perform its obligations under the Operative Documents to which it is a
party and is duly qualified to do business as a foreign corporation in good
standing in each other jurisdiction in which the failure to so qualify would
have a material adverse effect on the consolidated financial condition of
Company and its subsidiaries, considered as a whole, and its jurisdiction of
organization (as such term is used in Article 9 of the Uniform Commercial Code
as in effect in the State of Delaware) is Delaware.
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(b) The execution, delivery and performance by Company of
this Agreement and the other Operative Documents to which Company is a party
have been duly authorized by all necessary corporate action on the part of
Company, do not require any stockholder approval or approval or consent of any
trustee or holder of any indebtedness or obligations of Company, except such as
have been duly obtained and are in full force and effect, and do not contravene
any law, governmental rule, regulation, judgment or order binding on Company or
the certificate of incorporation or by-laws of Company or contravene or result
in a breach of, or constitute a default under, or result in the creation of any
Lien (other than as permitted under the Indenture) upon the property of Company
under, any material indenture, mortgage, contract or other agreement to which
Company is a party or by which it or any of its properties may be bound or
affected.
(c) Neither the execution and delivery by Company of this
Agreement and the other Operative Documents to which it is a party, nor the
consummation by Company of any of the transactions contemplated hereby or
thereby, requires the authorization, consent or approval of, the giving of
notice to, the filing or registration with or the taking of any other action in
respect of, the Department of Transportation, the FAA or any other federal or
state governmental authority or agency, except for (i) the orders, permits,
waivers, exemptions, authorizations and approvals of the regulatory authorities
having jurisdiction over Company's operation of the Aircraft required to be
obtained on or prior to the Closing Date, which orders, permits, waivers,
exemptions, authorizations and approvals have been duly obtained and are, or on
the Closing Date will be, in full force and effect, (ii) the filings referred to
in Section 4.01(e) (iii) authorizations, consents, approvals, notices and
filings required to be obtained, taken, given or made under securities or Blue
Sky or similar laws of the various states and foreign jurisdictions and (iv)
consents, approvals, notices, registrations and other actions required to be
obtained, given, made or taken only after the date hereof.
(d) This Agreement and each other Operative Document to
which Company is a party have been duly executed and delivered by Company and
constitute the legal, valid and binding obligations of Company enforceable
against Company in accordance with their terms, except as the same may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the rights of creditors generally and by general principles of
equity and except, in the case of the Indenture, as limited by applicable laws
that may affect the remedies provided in the Indenture.
(e) Except for (i) the filing for recordation pursuant to
the Transportation Code of the Indenture (with the Indenture Supplement covering
the Aircraft attached) and (ii) with respect to the security interests created
by such documents, the filing of financing statements (and continuation
statements at periodic intervals) under the Uniform Commercial Code of Delaware,
no further filing or recording of any document is necessary under the laws of
the United States or any state thereof as of the Closing Date in order to
establish and perfect the security interest in the Aircraft created under the
Indenture in favor of Loan Trustee as against Company and any third parties in
any applicable jurisdiction in the United States.
(f) Company is not an investment company or a company
controlled by an investment company within the meaning of the Investment Company
Act of 1940, as amended.
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(g) As of the Closing Date, (i) Company has good title to
the Aircraft, free and clear of Liens other than Permitted Liens, (ii) the
Aircraft has been duly certificated by the FAA as to type and airworthiness in
accordance with the terms of the Indenture, (iii) the Indenture (with the
Indenture Supplement covering the Aircraft attached) has been duly filed for
recordation (or shall be in the process of being so duly filed for recordation)
with the FAA pursuant to the Transportation Code and (iv) the Aircraft is duly
registered with the FAA in the name of Company.
(h) Company holds all licenses, permits and franchises
from the appropriate government entities necessary to authorize Company lawfully
to engage in air transportation and to carry on scheduled commercial passenger
service as currently conducted, except where the failure to so hold any such
license, permit or franchise would not have a material adverse effect on the
financial condition or operations of Company.
(i) Neither Company nor any person authorized to act on
its behalf has directly or indirectly offered any beneficial interest or
security relating to the ownership of the Aircraft, or any of the Equipment
Notes or any other interest in or security under the Indenture, for sale to, or
solicited any offer to acquire any such interest or security from, or has sold
any such interest or security to, any person in violation of the Securities Act
of 1933, as amended.
(j) No Person acting on behalf of Company is or will be
entitled to any broker's fee, commission or finder's fee in connection with the
transactions contemplated hereby, other than the fees and expenses payable by
Company in connection with the sale of the Pass Through Certificates on the
Closing Date.
Section 4.02 General Indemnity. (a) Claims Defined. For
the purposes of this Section 4.02, "Claims" means any and all liabilities,
obligations, losses, damages, penalties, claims, actions, suits, costs or
expenses of whatsoever kind and nature (whether or not on the basis of
negligence, strict or absolute liability or liability in tort) that may be
imposed on, incurred by, suffered by or asserted against an Indemnitee, as
defined below, and, except as otherwise expressly provided in this Section 4.02,
includes all reasonable out-of-pocket costs, disbursements and expenses
(including reasonable out-of-pocket legal fees and expenses) actually incurred
by an Indemnitee in connection therewith or related thereto.
(b) Indemnitee Defined. For the purposes of this Section
4.02, "Indemnitee" means (i) U.S. Bank and Loan Trustee, (ii) each separate or
additional trustee appointed pursuant to Section 8.02 of the Indenture, (iii) so
long as it holds any Equipment Notes as agent and trustee of any Pass Through
Trustee, Subordination Agent, (iv) so long as it is the holder of any Equipment
Notes, each Pass Through Trustee, (v) Policy Provider and its affiliates and
each Liquidity Provider and (vi) each of their respective successors and
permitted assigns in such capacities, agents, servants, officers, employees and
directors (the respective agents, servants, officers, employees and directors of
each of the foregoing Indemnitees, as applicable, together with such Indemnitee
and any affiliate of such Indemnitee, being collectively the "Related Indemnitee
Group" of such Indemnitee); provided that such Persons, to the extent they are
not signatories to this Agreement, have expressly agreed in writing to be bound
by the terms of this Section 4.02 prior to, or concurrently with, the making of
a Claim. If any Indemnitee fails to comply with any duty or obligation under
this Section 4.02 with respect to any Claim, such
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Indemnitee shall not be entitled to any indemnity with respect to such Claim
under this Section 4.02 to the extent such failure was prejudicial to Company.
No holder of a Pass Through Certificate in its capacity as such holder shall be
an Indemnitee.
(c) Claims Indemnified. Subject to the exclusions stated in
Subsection 4.02(d), Company agrees to indemnify, protect, defend and hold
harmless on an After-Tax Basis each Indemnitee against Claims resulting from or
arising out of (a) the Operative Documents or the enforcement of any of the
terms of the Operative Documents, (b) the Aircraft, the Airframe, any Engine or
any Part, including, without limitation, with respect thereto, (i) the sale,
purchase, acceptance, non-acceptance or rejection of the Aircraft under the
Purchase Agreement or the ownership, possession, use, non-use, substitution,
airworthiness, control, maintenance, repair, operation, registration,
re-registration, de-registration, delivery, nondelivery, assignment,
abandonment, condition, sale, lease, sublease, storage, modification,
alteration, return, transfer or other disposition of the Aircraft, the Airframe,
any Engine or any Part (including, without limitation, latent or other defects,
whether or not discoverable, and any claim for patent, trademark or copyright
infringement) by Company, any Permitted Lessee or any other Person, (ii) tort
liability, whether or not arising out of the negligence of any Indemnitee
(whether active, passive or imputed), (iii) death or property damage of
passengers, shippers or others, (iv) environmental control, noise or pollution,
and (c) the offer, sale or delivery of any Equipment Notes, Pass Through
Certificates or any interest therein or represented thereby. Without limiting
the foregoing and subject to, and without duplication of, the provisions of
Section 6.01(a), Company agrees to pay the reasonable ongoing fees, and the
reasonable out-of-pocket costs and expenses actually incurred (including,
without limitation, reasonable attorney's fees and disbursements actually
incurred and, to the extent payable as provided in the Indenture, reasonable
compensation and expenses of Loan Trustee's agents actually incurred), of Loan
Trustee in connection with the transactions contemplated hereby.
(d) Claims Excluded. The following are excluded from
Company's agreement to indemnify an Indemnitee under this Section 4.02:
(i) any Claim to the extent such Claim is attributable to
acts or events occurring after (x) the Lien of the Indenture has been
discharged or (y) the transfer of possession of the Aircraft pursuant
to Article IV of the Indenture except to the extent that such Claim is
attributable to acts occurring in connection with the exercise of
remedies pursuant to Section 4.02 of the Indenture following the
occurrence and continuance of an Event of Default;
(ii) any Claim to the extent such Claim is, or is
attributable to, a Tax, except with respect to paying indemnity amounts
on an After-Tax Basis;
(iii) any Claim to the extent such Claim is attributable to
the negligence or willful misconduct of such Indemnitee or such
Indemnitee's Related Indemnitee Group;
(iv) any Claim to the extent such Claim is attributable to
the noncompliance by such Indemnitee or such Indemnitee's Related
Indemnitee Group with any of the terms of, or any misrepresentation by
an Indemnitee or its Related Indemnitee Group contained in, this
Agreement, any other Operative Document or any Pass Through Document to
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which such Indemnitee or any of such Related Indemnitee Group is a
party or any agreement relating hereto or thereto;
(v) any Claim to the extent such Claim constitutes a
Permitted Lien attributable to such Indemnitee;
(vi) any Claim to the extent such Claim is attributable to
the offer, sale, assignment, transfer, participation or other
disposition (whether voluntary or involuntary) by or on behalf of such
Indemnitee or its Related Indemnitee Group (other than during the
occurrence and continuance of an Event of Default provided that any
such offer, sale, assignment, transfer, participation or other
disposition during the occurrence and continuation of an Event of
Default shall not be subject to indemnification unless it is made in
accordance with the Indenture and applicable law) of any Equipment Note
or interest therein or Pass Through Certificate, all or any part of
such Indemnitee's interest in the Operative Documents or the Pass
Through Documents or any interest in the Collateral or any similar
security;
(vii) any Claim to the extent such Claim is attributable to
(A) a failure on the part of Loan Trustee to distribute in accordance
with this Agreement or the Indenture any amounts received and
distributable by it hereunder or thereunder, (B) a failure on the part
of Subordination Agent to distribute in accordance with the
Intercreditor Agreement any amounts received and distributable by it
thereunder or (C) a failure on the part of any Pass Through Trustee to
distribute in accordance with the Pass Through Trust Agreement to which
it is a party any amounts received and distributable by it thereunder;
(viii) any Claim to the extent such Claim is attributable to
the authorization or giving or withholding of any future amendments,
supplements, waivers or consents with respect to any Operative Document
or any Pass Through Document, other than such as have been requested by
Company or that occur as the result of an Event of Default, or such as
are expressly required or contemplated by the provisions of the
Operative Documents or the Pass Through Documents;
(ix) any Claim to the extent such Claim is payable or
borne by (a) Company pursuant to any indemnification, compensation or
reimbursement provision of any other Operative Document or any Pass
Through Document or (b) a Person other than Company pursuant to any
provision of any Operative Document or any Pass Through Document;
(x) any Claim to the extent such Claim is an ordinary and
usual operating or overhead expense or not an out-of-pocket expense
actually incurred;
(xi) any Claim to the extent such Claim is incurred on
account of or asserted as a result of any "prohibited transaction"
within the meaning of Section 406 of ERISA or Section 4975 of the Code;
(xii) any Claim to the extent such Claim is attributable to
one or more of the other aircraft financed through the offering of Pass
Through Certificates (in the event of doubt, any Claim shall be
allocated between the Aircraft and such other aircraft in the same
proportion that the then outstanding Equipment Notes bear to the then
outstanding
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equipment notes issued with respect to the other aircraft and held by
Pass Through Trustees);
(xiii) any Claim by an Indemnitee related to the status of
such Indemnitee as a passenger or shipper on any of Company's aircraft
or as a party to a marketing or promotional or other commercial
agreement with Company unrelated to the transactions contemplated by
the Operative Documents; and
(xiv) any Claim to the extent such Claim is attributable to
the offer or sale by an Indemnitee (or any member of such Indemnitee's
Related Indemnitee Group) of any interest in the Aircraft, the
Equipment Notes, the Pass Through Certificates, or any similar
interest, in violation of the Securities Act of 1933, as amended, or
other applicable federal, state or foreign securities laws (other than
any thereof caused by acts or omissions of Company of any of its
affiliates).
(e) Insured Claims. In the case of any Claim indemnified
by Company hereunder that is covered by a policy of insurance maintained by
Company, each Indemnitee agrees to cooperate, at Company's expense, with the
insurers in the exercise of their rights to investigate, defend and compromise
such Claim.
(f) Claims Procedure. An Indemnitee shall promptly notify
Company of any Claim as to which indemnification is sought. The failure to
provide such prompt notice shall not release Company from any of its obligations
to indemnify hereunder except to the extent that Company is prejudiced by such
failure or Company's indemnification obligations are increased as a result of
such failure (in which event Company shall not be responsible for such
additional indemnification obligations). Such Indemnitee shall promptly submit
to Company all additional information in such Indemnitee's possession to
substantiate such Claim as Company reasonably requests. Subject to the rights of
Company's insurers, Company may, at its sole cost and expense, investigate any
Claim, and may in its sole discretion defend or compromise any Claim. At
Company's expense, any Indemnitee shall cooperate with all reasonable requests
of Company in connection therewith. Such Indemnitee shall not enter into a
settlement or other compromise with respect to any Claim without the prior
written consent of Company, which consent shall not be unreasonably withheld or
delayed, unless such Indemnitee waives its right to be indemnified with respect
to such Claim. Where Company or its insurers undertake the defense of an
Indemnitee with respect to a Claim, no additional legal fees or expenses of such
Indemnitee in connection with the defense of such Claim shall be indemnified
hereunder unless such fees or expenses were incurred at the written request of
Company or such insurers. Subject to the requirements of any policy of
insurance, an Indemnitee may participate at its own expense in any judicial
proceeding controlled by Company pursuant to the preceding provisions; provided
that such party's participation does not, in the opinion of outside counsel
appointed by Company or its insurers to conduct such proceedings, interfere with
such control. Such participation shall not constitute a waiver of the
indemnification provided in this Section 4.02. Notwithstanding anything to the
contrary contained herein, Company shall not under any circumstances be liable
for the fees and expenses of more than one counsel for all Indemnitees with
respect to any one Claim. Notwithstanding anything to the contrary contained
herein, an Indemnitee shall not under any circumstances be required or deemed to
be required to contest any Claim or to assume responsibility for or control of
any judicial proceeding with respect thereto. Company will
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provide the relevant Indemnitee with such information not within the control of
such Indemnitee, as is in Company's control or is reasonably available to
Company, which such Indemnitee may reasonably request and will otherwise
cooperate with such Indemnitee so as to enable such Indemnitee to fulfill its
obligations under this Section.
(g) Subrogation. To the extent that a Claim is in fact
paid in full by Company or its insurer, Company or such insurer (as the case may
be) shall, without any further action, be subrogated to the rights and remedies
of the Indemnitee on whose behalf such Claim was paid with respect to the
transaction or event giving rise to such Claim. Such Indemnitee shall give such
further assurances or agreements and shall cooperate with Company or such
insurer, as the case may be, to permit Company or such insurer to pursue such
rights and remedies, if any, to the extent reasonably requested by Company. So
long as no Event of Default has occurred and is continuing, if an Indemnitee
receives any payment, in whole or in part, from any party other than Company or
its insurers with respect to any Claim paid by Company or its insurers, it shall
promptly pay over to Company the amount received (but not an amount in excess of
the amount Company or any of its insurers has paid in respect of such Claim).
Any amount referred to in the preceding sentence that is payable to Company
shall not be paid to Company, or, if it has been previously paid directly to
Company, shall not be retained by Company, if at the time of such payment an
Event of Default has occurred and is continuing, but shall be paid to and held
by Loan Trustee as security for the obligations of Company under the Operative
Documents. If Company agrees, such amount payable shall be applied against
Company's obligations thereunder when and as they become due and payable. At
such time as such Event of Default is no longer continuing, such amount, to the
extent not previously so applied against Company's obligations, shall be paid to
Company.
(h) No Guaranty. Nothing set forth in this Section 4.02
constitutes a guarantee by Company that the Aircraft at any time will have any
particular value, useful life or residual value.
(i) Payments; Interest. Any amount payable to any
Indemnitee on account of a Claim shall be paid within 30 days after receipt by
Company of a written demand therefor from such Indemnitee accompanied by a
written statement describing in reasonable detail the Claims that are the
subject of and basis for such indemnity and the computation of the amount
payable. Any payments made pursuant to this Section 4.02 directly to an
Indemnitee or to Company, as the case may be, shall be made in immediately
available funds at such bank or to such account as is specified by the payee in
written directions to the payor or, if no such directions are given, by check of
the payor payable to the order of the payee and mailed to the payee by certified
mail, return receipt requested, postage prepaid to its address referred to in
Section 7.01. To the extent permitted by applicable law, interest at the Past
Due Rate shall be paid, on demand, on any amount or indemnity not paid when due
pursuant to this Section 4.02 until the same is paid. Such interest shall be
paid in the same manner as the unpaid amount in respect of which such interest
is due.
(j) Tax deduction or credit. If, by reason of any Claim
payment made to or for the account of an Indemnitee by Company pursuant to this
Section 4.02, such Indemnitee subsequently realizes a tax deduction or credit
not previously taken into account in computing such payment, such Indemnitee
shall promptly pay to Company, but only if Company has made
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all payments then due and owing to such Indemnitee under the Operative
Documents, an amount equal to the sum of (1) the actual reduction in Taxes
realized by such Indemnitee which such Indemnitee determines in its good faith
judgment is attributable to such deduction or credit, and (2) the actual
reduction in Taxes realized by such Indemnitee as such Indemnitee determines in
its good faith judgement is a result of any payment made by such Indemnitee
pursuant to this sentence; provided that the amount payable by such Indemnitee
pursuant to this sentence shall not exceed the sum of the amounts previously
paid by Company in order to indemnify such Claim on an After-Tax Basis. If such
tax benefit is subsequently disallowed or lost, upon written notice from the
Indemnitee, the Company shall repay all amounts paid to it pursuant to this
Section 4.2(j) in respect of such disallowed or lost tax benefits.
ARTICLE 5
REPRESENTATIONS, WARRANTIES AND COVENANTS OF U.S. BANK
Section 5.01 Representations, Warranties and Covenants of
U.S. Bank. U.S. Bank, generally, and each of Loan Trustee, Subordination Agent
and Pass Through Trustee as it relates to it, represents, warrants and covenants
that:
(a) U.S. Bank is a national banking association duly
organized and validly existing in good standing under the laws of the United
States, is eligible to be Loan Trustee under Section 8.01(a) of the Indenture,
will promptly comply with Section 8.01(a) of the Indenture and has full power,
authority and legal right to enter into and perform its obligations under each
of the Operative Documents and the Pass Through Documents to which U.S. Bank,
Loan Trustee, Subordination Agent or any Pass Through Trustee is a party and, in
its capacity as Loan Trustee and Pass Through Trustee, respectively, to
authenticate the Equipment Notes and the Pass Through Certificates,
respectively. U.S. Bank is qualified to act as Loan Trustee under Section
8.01(c) of the Indenture.
(b) The execution, delivery and performance by U.S. Bank,
individually or in its capacity as Loan Trustee, Subordination Agent or Pass
Through Trustee, as the case may be, of this Agreement, each of the other
Operative Documents and each of the Pass Through Documents to which U.S. Bank,
Loan Trustee, Subordination Agent or any Pass Through Trustee is a party, and
the authentication of the Equipment Notes and the Pass Through Certificates,
respectively, to be delivered on the Closing Date, have been duly authorized by
all necessary action on the part of U.S. Bank, Loan Trustee, Subordination Agent
and each Pass Through Trustee, as the case may be, and do not violate any law or
regulation of the United States or of the state of the United States in which
U.S. Bank is located and which governs the banking and trust powers of U.S. Bank
or any order, writ, judgment or decree of any court, arbitrator or governmental
authority applicable to U.S. Bank, Loan Trustee, Subordination Agent or any Pass
Through Trustee or any of their assets, will not violate any provision of the
articles of association or by-laws of U.S. Bank and will not violate any
provision of, or constitute a default under, any mortgage, indenture, contract,
agreement or undertaking to which any of U.S. Bank, Loan Trustee, Subordination
Agent or any Pass Through Trustee is a party or by which any of them or their
respective properties may be bound or affected.
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(c) Neither the execution and delivery by U.S. Bank,
individually or in its capacity as Loan Trustee, Subordination Agent or Pass
Through Trustee, as the case may be, of this Agreement, any other Operative
Document or any Pass Through Document to which U.S. Bank, Loan Trustee,
Subordination Agent or any Pass Through Trustee is a party, nor the consummation
by U.S. Bank, Loan Trustee, Subordination Agent or any Pass Through Trustee of
any of the transactions contemplated hereby or thereby, requires the
authorization, consent or approval of, the giving of notice to, the filing or
registration with, or the taking of any other action in respect of, (i) any
governmental authority or agency of the United States or the state of the United
States where U.S. Bank is located and regulating the banking and trust powers of
U.S. Bank and (ii) any trustee or other holder of any debt of U.S. Bank.
(d) This Agreement, each other Operative Document and
each Pass Through Document to which U.S. Bank, Loan Trustee, Subordination Agent
or any Pass Through Trustee is a party have been duly executed and delivered by
U.S. Bank, individually and in its capacity as Loan Trustee, Subordination Agent
or Pass Through Trustee, as the case may be, and constitute the legal, valid and
binding obligations of U.S. Bank, Loan Trustee, Subordination Agent and such
Pass Through Trustee, as the case may be, enforceable against it in accordance
with its terms, except as the same may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the rights of
creditors generally and by general principles of equity.
(e) It unconditionally agrees with and for the benefit of
the parties to this Agreement that it will not directly or indirectly create,
incur, assume or suffer to exist any Loan Trustee Lien or Other Party Lien
attributable to it, and it agrees that it will, at its own cost and expense,
promptly take such action as may be necessary to discharge and satisfy in full
any such Lien; and it shall indemnify, protect, defend and hold harmless each
Indemnitee and Company against Claims in any way resulting from or arising out
of a breach by it of its obligations under this Section 5.01(e).
(f) The Equipment Notes to be issued to Subordination
Agent pursuant hereto are being acquired by it to be held under the
Intercreditor Agreement.
(g) Each of U.S. Bank, Loan Trustee, Subordination Agent
and each Pass Through Trustee agrees that it will not impose any lifting charge,
cable charge, remittance charge or any other charge or fee on any transfer by
Company of funds to, through or by U.S. Bank, Loan Trustee, Subordination Agent
or such Pass Through Trustee pursuant to this Agreement, any other Operative
Document or any Pass Through Document, except as may be otherwise agreed to in
writing by Company.
(h) Each of U.S. Bank, Loan Trustee, Subordination Agent
and any Pass Through Trustee agrees to be bound by the terms of Section 10.16 of
the Indenture.
(i) There are no Taxes payable by U.S. Bank, Loan
Trustee, Subordination Agent or any Pass Through Trustee imposed by the State of
Connecticut, the State of Delaware or any political subdivision or taxing
authority of either thereof in connection with the execution, delivery or
performance by U.S. Bank, Loan Trustee, Subordination Agent or any Pass Through
Trustee of any Operative Document or any Pass Through Document (other than
franchise or
-15-
other taxes based on or measured by any fees or compensation received by any
such Person for services rendered in connection with the transactions
contemplated by the Operative Documents or the Pass Through Documents), and
there are no Taxes payable by any Pass Through Trustee imposed by the State of
Connecticut, the State of Delaware or any political subdivision of either
thereof in connection with the acquisition, possession or ownership by such Pass
Through Trustee of any of the Equipment Notes (other than franchise or other
taxes based on or measured by any fees or compensation received by such Pass
Through Trustee for services rendered in connection with the transactions
contemplated by the Operative Documents or the Pass Through Documents) and,
assuming that the Pass Through Trusts will not be taxable for Federal income tax
purposes as corporations, but, rather, will be characterized for such purposes
as grantor trusts or partnerships, the Pass Through Trusts will not be subject
to any Taxes imposed by the State of Connecticut, the State of Delaware or any
political subdivision of either thereof.
(j) Except with the consent of Company, which shall not
be unreasonably withheld, U.S. Bank will act as Pass Through Trustee solely
through its offices within the State of Connecticut, except for such services
that may be performed for it by various agents, but not directly by it, in other
states.
(k) There are no pending or, to its knowledge, threatened
actions or proceedings against U.S. Bank, Loan Trustee, Subordination Agent or
any Pass Through Trustee before any court or administrative agency which
individually or in the aggregate, if determined adversely to it, would
materially adversely affect the ability of U.S. Bank, Loan Trustee,
Subordination Agent or any Pass Through Trustee to perform its obligations under
any Operative Document or any Pass Through Document.
(l) The representations and warranties contained in
Section 7.15 of each Pass Through Trust Agreement are true, complete and correct
as of the Closing Date.
ARTICLE 6
OTHER COVENANTS AND AGREEMENTS
Section 6.01 Other Agreements. (a) Company agrees
promptly to pay (without duplication of any other obligation Company may have to
pay such amounts) (A) the initial and annual fees and (to the extent Loan
Trustee is entitled to be reimbursed for its reasonable expenses) the reasonable
expenses of Loan Trustee in connection with the transactions contemplated hereby
and (B) the following expenses incurred by Loan Trustee, Subordination Agent and
Pass Through Trustees in connection with the negotiation, preparation, execution
and delivery of this Agreement, the other Operative Documents and the other
documents or instruments referred to herein or therein:
(i) the reasonable fees, expenses and disbursements of
(x) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, special counsel for Loan Trustee,
Subordination Agent and Pass Through Trustees and (y) Daugherty,
Fowler, Peregrin & ▇▇▇▇▇▇, A Professional Corporation, special FAA
counsel in Oklahoma City, Oklahoma, in each case to the extent actually
incurred; and
-16-
(ii) all reasonable expenses incurred in connection with
printing and document production or reproduction expenses, and in
connection with the filing of Uniform Commercial Code financing
statements.
(b) Loan Trustee, Noteholders, Subordination Agent and
each Pass Through Trustee agree to execute and deliver, at Company's expense,
all such documents as Company reasonably requests for the purpose of continuing
the registration of the Aircraft at the FAA in Company's name. In addition, each
of Loan Trustee, Subordination Agent, each Pass Through Trustee and any other
Noteholder agrees, for the benefit of Company, to cooperate with Company in
effecting any foreign registration of the Aircraft pursuant to Section 7.02(e)
of the Indenture; provided that prior to any such change in the country of
registry of the Aircraft the conditions set forth in Section 7.02(e) of the
Indenture are met to the reasonable satisfaction of, or waived by, Loan Trustee.
(c) Each of U.S. Bank, Loan Trustee, Subordination Agent,
each Pass Through Trustee and any other Noteholder agrees that, unless an Event
of Default shall have occurred and be continuing, it shall not take any action
contrary to, or otherwise in any way interfere with or disturb (and then only in
accordance with the Indenture), the quiet enjoyment of the use and possession of
the Aircraft, the Airframe, any Engine or any Part by Company or any transferee
of any interest in any thereof permitted under the Indenture.
(d) Each Noteholder, including, without limitation,
Subordination Agent and each Pass Through Trustee, unconditionally agrees with
and for the benefit of the parties to this Agreement that it will not directly
or indirectly create, incur, assume or suffer to exist any Noteholder Liens, and
such Noteholder agrees that it will, at its own cost and expense, promptly take
such action as may be necessary to discharge and satisfy in full any such
Noteholder Lien; and each Noteholder hereby agrees to indemnify, protect, defend
and hold harmless each Indemnitee and Company against Claims in any way
resulting from or arising out of a breach by it of its obligations under this
Section 6.01(d).
(e) By its acceptance of its Equipment Notes, each
Noteholder (i) unconditionally agrees for the benefit of Company and Loan
Trustee to be bound by and to perform and comply with all of the terms of such
Equipment Notes, the Indenture and this Agreement applicable to such Noteholder
and (ii) agrees that it will not transfer any Equipment Note (or any part
thereof) to any entity unless such entity makes (or is deemed to have made) a
representation and warranty as of the date of transfer that either no part of
the funds to be used by it for the purchase and holding of such Equipment Note
(or any part thereof) constitutes assets of any "employee benefit plan" or that
such purchase and holding will not result in a non-exempt prohibited transaction
under Section 4975 of the Code and Section 406 of ERISA.
(f) Each of Company, Loan Trustee, each Pass Through
Trustee and Subordination Agent covenants that (i) until one year and one day
after the Series G Equipment Notes have been paid in full, it shall not
acquiesce, petition or otherwise invoke or cause or join in invoking or causing
the Class G Pass Through Trust or any other Person to invoke the process of any
governmental authority for the purpose of commencing or sustaining a case
(whether voluntary or not) against the Class G Pass Through Trust under any
bankruptcy, insolvency or similar law or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other
-17-
similar official of the Class G Pass Through Trust or any substantial part of
its property or ordering the winding-up or liquidation of the affairs of the
Class G Pass Through Trust, (ii) until one year and one day after the Series C
Equipment Notes have been paid in full, it shall not acquiesce, petition or
otherwise invoke or cause or join in invoking or causing the Class C Pass
Through Trust or any other Person to invoke the process of any governmental
authority for the purpose of commencing or sustaining a case (whether voluntary
or not) against the Class C Pass Through Trust under any bankruptcy, insolvency
or similar law or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Class C Pass Through
Trust or any substantial part of its property or ordering the winding-up or
liquidation of the affairs of the Class C Pass Through Trust and (iii) until one
year and one day after the Series D Equipment Notes have been paid in full, it
shall not acquiesce, petition or otherwise invoke or cause or join in invoking
or causing the Class D Pass Through Trust or any other Person to invoke the
process of any governmental authority for the purpose of commencing or
sustaining a case (whether voluntary or not) against the Class D Pass Through
Trust under any bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Class D Pass Through Trust or any substantial part of its property or
ordering the winding-up or liquidation of the affairs of the Class D Pass
Through Trust.
Section 6.02 Certain Covenants of Company. Company
covenants and agrees with Loan Trustee as follows:
(a) On and after the Closing, Company will cause to be
done, executed, acknowledged and delivered such further acts, conveyances and
assurances as Loan Trustee reasonably requests for accomplishing the purposes of
this Agreement and the other Operative Documents; provided that any instrument
or other document so executed by Company will not expand any obligations or
limit any rights of Company in respect of the transactions contemplated by the
Operative Documents.
(b) Company, at its expense, will cause the Indenture
(with the Indenture Supplement covering the Aircraft attached) to be promptly
filed and recorded, or filed for recording, with the FAA to the extent permitted
under the Transportation Code and the rules and regulations of the FAA
thereunder.
(c) Company, at its expense, will take, or cause to be
taken, such action with respect to the recording, filing, re-recording and
refiling of the Indenture and any financing statements or other instruments as
are necessary to maintain, so long as the Indenture is in effect, the perfection
of the security interests created by the Indenture or will furnish Loan Trustee
timely notice of the necessity of such action, together with such instruments,
in execution form, and such other information as may be required to enable Loan
Trustee to take such action. In addition, Company will pay any and all
recording, stamp and other similar taxes payable in the United States, and in
any other jurisdiction where the Aircraft is registered, in connection with the
execution, delivery, recording, filing, re-recording and refiling of the
Indenture or any such financing statements or other instruments. Company will
notify Loan Trustee of any change in its jurisdiction of organization (as such
term is used in Article 9 of the Uniform Commercial Code as in effect in the
State of Delaware) promptly after making such change or in any event
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within the period of time necessary under applicable law to prevent the lapse of
perfection (absent refiling) of financing statements filed under the Operative
Documents.
(d) Company shall at all times maintain its corporate
existence except as permitted by Subsection 6.02(e).
(e) Company shall not consolidate with or merge into any
other Person or convey, transfer or lease substantially all of its assets as an
entirety to any Person, unless:
(i) the successor or transferee entity shall, if and to
the extent required under Section 1110 in order that Loan Trustee
continues to be entitled to any benefits of Section 1110 with respect
to the Aircraft, be a Citizen of the United States and a Certificated
Air Carrier and shall execute and deliver to Loan Trustee an agreement
containing the express assumption by such successor or transferee
entity of the due and punctual performance and observance of each
covenant and condition of the Operative Documents to which Company is a
party to be performed or observed by Company;
(ii) if the Aircraft is, at the time, registered with the
FAA, such Person makes such filings and recordings with the FAA
pursuant to the Act, or if the Aircraft is, at the time, not registered
with the FAA, such Person makes such filings and recordings with the
applicable aviation authority, as are necessary to evidence such
consolidation, merger conveyance, transfer or lease;
(iii) immediately after giving effect to such transaction,
no Event of Default shall have occurred and be continuing; and
(iv) Company shall deliver to Policy Provider and Loan
Trustee a certificate signed by a Responsible Officer of Company, and
an opinion of counsel (which may be the general counsel, a deputy
general counsel or an associate general counsel to Company), each
stating that such consolidation, merger, conveyance, transfer or lease
and the assumption agreement mentioned in clause (i) above comply with
this Subsection 6.02(e) and that all conditions precedent herein
relating to such transaction have been complied with (except that such
opinion need not cover the matters referred to in clause (iii) above
and may rely, as to factual matters, on a certificate of an officer of
Company) and, in the case of such opinion, that such assumption
agreement has been duly authorized, executed and delivered by such
successor Person and is enforceable against such successor Person in
accordance with its terms, except as the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the rights of creditors generally and by general
principles of equity.
Upon any consolidation or merger, or any conveyance, transfer
or lease of substantially all of the assets of Company as an entirety in
accordance with this Subsection 6.02(e), the successor Person formed by such
consolidation or into which Company is merged or to which such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may
exercise every right and power of, Company under this Agreement and the other
Operative Documents with the same effect as if such successor Person had been
named as Company herein.
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(f) Company shall remain a Certificated Air Carrier for
as long as and to the extent required under Section 1110 in order that Loan
Trustee shall be entitled to any of the benefits of Section 1110 with respect to
the Aircraft.
ARTICLE 7
MISCELLANEOUS
Section 7.01 Notices. Unless otherwise expressly
specified or permitted by the terms hereof, all notices required or permitted
under the terms and provisions of this Agreement shall be in English and in
writing, and any such notice may be given by registered or certified United
States mail, courier service or facsimile or any other customary means of
communication, and any such notice shall be effective when delivered (or, if
delivered by facsimile, upon completion of transmission and confirmation by the
sender (by a telephone call to a representative of the recipient or by machine
confirmation) that such transmission was received) addressed as follows:
if to Company, addressed to:
Delta Air Lines, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer, Dept. 856
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to the General Counsel at the same address, but Dept. 971
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
if to U.S. Bank, Loan Trustee, Subordination Agent or any Pass Through Trustee,
addressed to:
U.S. Bank Trust National Association
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Square
Hartford, Connecticut 06103
Attention: Corporate Trust Division
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or if to any subsequent Noteholder, addressed to such Noteholder at its address
set forth in the Equipment Note Register maintained pursuant to Section 2.07 of
the Indenture.
-20-
Any party, by notice to the other parties hereto, may
designate different addresses for subsequent notices or communications. Whenever
the words "notice" or "notify" or similar words are used herein, they mean the
provision of formal notice as set forth in this Section 7.01.
Section 7.02 Survival of Representations, Warranties,
Indemnities, Covenants and Agreements. Except as otherwise provided herein, the
representations, warranties, indemnities, covenants and agreements of Company,
U.S. Bank, Loan Trustee, Subordination Agent, each Pass Through Trustee and
Noteholders herein, and each of their obligations hereunder, shall survive the
making of the loans, the transfer of any interest by any Noteholder of its
Equipment Note and the expiration or termination (to the extent arising out of
acts or events occurring prior to such expiration) of any Operative Documents.
SECTION 7.03 GOVERNING LAW. THIS AGREEMENT HAS BEEN
DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 7.04 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 7.05 No Oral Modifications or Continuing Waivers;
Consents. Subject to Section 9.03 of the Indenture, 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 against which the enforcement of
the change, waiver, discharge or termination is sought. No such change, waiver,
discharge or termination shall be effective unless a signed copy thereof is
delivered to Loan Trustee. Each Pass Through Trustee and, by its acceptance of
an Equipment Note, each subsequent Noteholder covenants and agrees that it shall
not unreasonably withhold its consent to any consent of Loan Trustee requested
by Company under the Indenture.
Section 7.06 Effect of Headings and Table of Contents.
The headings of the various Articles and Sections herein and in the Table of
Contents are for convenience of reference only and do not define or limit any of
the terms or provisions hereof.
Section 7.07 Successors and Assigns. All covenants,
agreements, representations and warranties in this Agreement by Company, by U.S.
Bank, individually or as Loan Trustee, Subordination Agent or Pass Through
Trustee, or by any Noteholder, shall bind and inure to the benefit of and be
enforceable by Company, and subject to the terms of Section 6.02(e), its
successors and permitted assigns, each Pass Through Trustee and any successor or
other trustee under the Pass Through Trust Agreement to which it is a party,
Subordination Agent and its successor under the Intercreditor Agreement and Loan
Trustee and its successor under the Indenture, whether so expressed or not.
-21-
Section 7.08 Benefits of Agreement. Subject to the next
sentence, nothing in this Agreement, express or implied, gives to any Person,
other than the parties hereto and their successors hereunder, any benefit or any
legal or equitable right, remedy or claim under this Agreement, except as
expressly provided herein. Company agrees and acknowledges that each Liquidity
Provider, Policy Provider and each separate or additional trustee appointed
pursuant to Section 8.02 of the Indenture shall be third party beneficiaries of
the covenants and agreements of Company with respect to the indemnities
contained in Section 4.02 and may rely on the covenants and agreements of
Company with respect to such indemnities to the same extent as if the covenants
and agreements of Company with respect to such indemnities were made to each
Liquidity Provider and Policy Provider directly (and in addition Policy Provider
shall be a third party beneficiary of the covenants and agreements in its favor
contained in Section 6.02(e)(iv) and may rely on such covenants and agreements
to the same extent as if such covenants and agreements were made to Policy
Provider directly).
Section 7.09 Counterparts. This Agreement may be executed
in any number of counterparts. Each of the parties hereto shall not be required
to execute the same counterpart. Each counterpart of this Agreement including a
signature page or pages executed by each of the parties hereto shall be an
original counterpart of this Agreement, but all of such counterparts shall
together constitute one instrument.
Section 7.10 Submission to Jurisdiction. Each of the
parties hereto, to the extent it may do so under applicable law, for purposes
hereof and of all other Operative Documents hereby (a) irrevocably submits
itself to the non-exclusive jurisdiction of the courts of the State of New York
sitting in the City of New York and to the non-exclusive jurisdiction of the
United States District Court for the Southern District of New York, for the
purposes of any suit, action or other proceeding arising out of this Agreement,
the subject matter hereof or any of the transactions contemplated hereby brought
by any party or parties hereto, or their successors or permitted assigns and (b)
waives, and agrees not to assert, by way of motion, as a defense, or otherwise,
in any such suit, action or proceeding, that the suit, action or proceeding is
brought in an inconvenient forum, that the venue of the suit, action or
proceeding is improper or that this Agreement or the subject matter hereof or
any of the transactions contemplated hereby may not be enforced in or by such
courts.
-22-
IN WITNESS WHEREOF, the parties hereto have caused this
Participation Agreement to be duly executed by their respective officers
thereunto duly authorized as of the date first above written.
DELTA AIR LINES, INC.
By:
--------------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION, as Pass Through Trustee
under each of the Pass Through Trust
Agreements
By:
--------------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION, as Subordination Agent
By:
--------------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION, as Loan Trustee
By:
--------------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION, in its individual
capacity as set forth herein
By:
--------------------------------------
Name:
Title:
SCHEDULE I to
PARTICIPATION AGREEMENT
EQUIPMENT NOTES,
PURCHASERS AND ORIGINAL PRINCIPAL AMOUNTS
DESCRIPTION OF ORIGINAL PRINCIPAL
PURCHASER EQUIPMENT NOTES MATURITY AMOUNT
--------- --------------- -------- -----------------
Delta Air Lines Pass Series 2003-1G Equipment January 25, 2008 $21,917,485.13
Through Trust 2003-1G Note EN-1G-001
Delta Air Lines Pass Series 2003-1C Equipment January 25, 2008 $ 8,325,376.09
Through Trust 2003-1C Note EN-1C-001
Delta Air Lines Pass Series 2003-1D Equipment January 25, 2008 $ 2,883,344.43
Through Trust 2003-1D Note EN-1D-001
I-1
SCHEDULE II to
PARTICIPATION AGREEMENT
TRUST SUPPLEMENTS
Trust Supplement No. 2003-1G, dated as of January 30, 2003,
between Company and Pass Through Trustee in respect of Delta Air Lines Pass
Through Trust 2003-1G.
Trust Supplement No. 2003-1C, dated as of January 30, 2003,
between Company and Pass Through Trustee in respect of Delta Air Lines Pass
Through Trust 2003-1C.
Trust Supplement No. 2003-1D, dated as of January 30, 2003,
between Company and Pass Through Trustee in respect of Delta Air Lines Pass
Through Trust 2003-1D.
II-1
SCHEDULE III to
PARTICIPATION AGREEMENT
EXCESS AMOUNT
Date Excess Amount
--------- -------------
30-Jan-03 $4,968,931
25-Apr-03 $4,968,931
25-Jul-03 $4,968,931
25-Oct-03 $4,968,931
25-Jan-04 $4,719,830
25-Apr-04 $4,719,830
25-Jul-04 $4,719,830
25-Oct-04 $4,719,830
25-Jan-05 $4,296,408
25-Apr-05 $4,296,408
25-Jul-05 $4,296,408
25-Oct-05 $4,296,408
25-Jan-06 $4,065,135
25-Apr-06 $4,065,135
25-Jul-06 $4,065,135
25-Oct-06 $4,065,135
25-Jan-07 $3,671,427
25-Apr-07 $3,671,427
25-Jul-07 $3,671,427
25-Oct-07 $3,671,427
25-Jan-08 $ 0
III-1
EXHIBIT A-1 to
PARTICIPATION AGREEMENT
FORM OF OPINION OF
COUNSEL FOR COMPANY
[Intentionally Omitted]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇ to
PARTICIPATION AGREEMENT
FORM OF OPINION OF
SPECIAL COUNSEL FOR COMPANY
[Intentionally Omitted]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇ to
PARTICIPATION AGREEMENT
FORM OF ss. 1110 OPINION OF
SPECIAL COUNSEL FOR COMPANY
[Intentionally Omitted]
A-3-1
EXHIBIT B to
PARTICIPATION AGREEMENT
FORM OF OPINION OF
SPECIAL COUNSEL FOR LOAN TRUSTEE,
SUBORDINATION AGENT AND U.S. BANK
[Intentionally Omitted]
B-1
EXHIBIT C to
PARTICIPATION AGREEMENT
FORM OF OPINION OF
SPECIAL FAA COUNSEL
[Intentionally Omitted]
C-1
EXHIBIT D-1 to
PARTICIPATION AGREEMENT
FORM OF OPINION OF SPECIAL
COUNSEL FOR PRIMARY LIQUIDITY PROVIDER
[Intentionally Omitted]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇ to
PARTICIPATION AGREEMENT
FORM OF OPINION OF GERMAN IN-HOUSE
COUNSEL FOR PRIMARY LIQUIDITY PROVIDER
[Intentionally Omitted]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇ to
PARTICIPATION AGREEMENT
FORM OF OPINION OF IN-HOUSE
COUNSEL FOR ABOVE-CAP LIQUIDITY PROVIDER
[Intentionally Omitted]
D-3-1
EXHIBIT E to
PARTICIPATION AGREEMENT
FORM OF MANUFACTURER'S CONSENT
[Intentionally Omitted]
E-1
EXHIBIT F-1 TO
PARTICIPATION AGREEMENT
FORM OF OPINION
SPECIAL COUNSEL FOR PASS THROUGH TRUSTEES
[Intentionally Omitted]
F-1-1
EXHIBIT F-2 TO
PARTICIPATION AGREEMENT
FORM OF OPINION
SPECIAL COUNSEL FOR PASS THROUGH TRUSTEES
[INTENTIONALLY OMITTED]
F-2-1
EXHIBIT G TO
PARTICIPATION AGREEMENT
FORM OF OPINION OF
IN-HOUSE COUNSEL FOR POLICY PROVIDER
[INTENTIONALLY OMITTED]
G-1