EXHIBIT 4.c
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PARTICIPATION AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N586FE)
Dated as of April 1, 1996
Amended and Restated as of September 1, 1996 and as further
Amended and Restated as of October 15, 1996
among
FEDERAL EXPRESS CORPORATION,
Lessee
AMERITECH CREDIT CORPORATION,
Owner Participant
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK
BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION
THE CHASE MANHATTAN BANK
COMMERZBANK AG, ATLANTA AGENCY and
NATIONSBANK, N.A. (SOUTH),
Original Loan Participants
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Not in Its Individual Capacity
Except as Otherwise Expressly
Set Forth Herein, but Solely as Owner Trustee,
Owner Trustee
STATE STREET BANK AND TRUST COMPANY,
Indenture Trustee
and
STATE STREET BANK AND TRUST COMPANY,
Pass Through Trustee
______________________________
LEVERAGED LEASE OF ONE ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MD-11F AIRCRAFT
SERIAL NO. 48487, REGISTRATION NO. N586FE
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TABLE OF CONTENTS
Page
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Initial Recitals........................................................... 1
ARTICLE 1
DEFINITIONS
ARTICLE 2
Section 2.01. Transfer of Funds........................................ 3
Section 2.02. Certificates............................................. 6
ARTICLE 3
EXTENT OF INTEREST OF ORIGINAL LOAN PARTICIPANTS
Section 3.01. Extent of Interest of Original Loan Participants......... 7
ARTICLE 4
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent..................................... 7
Section 4.02. Opinion of Special Aviation Counsel...................... 16
ARTICLE 5
CONDITIONS PRECEDENT TO LESSEE'S OBLIGATIONS
Section 5.01. Conditions Precedent to Lessee's Obligations............. 16
ARTICLE 6
LESSEE'S REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 6.01. Lessee's Representations and Warranties.................. 16
Section 6.02. Offering by Lessee....................................... 23
Section 6.03. Certain Covenants of Lessee.............................. 23
Section 6.04. Survival of Representations and Warranties............... 31
ARTICLE 7
OTHER PARTIES' REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Acquisitions and Offerings of Interests in Lessor's
Estate.................................................. 31
Section 7.02. Citizenship, Etc......................................... 32
Section 7.03. Representations, Warranties and Covenants of Owner
Participant............................................. 33
Section 7.04. Representations, Covenants and Warranties of FSB and the
Owner Trustee........................................... 36
Section 7.05. Representations, Warranties and Covenants of the Indenture
Trustee................................................. 39
Section 7.06. Indenture Trustee's Notice of Default.................... 41
Section 7.07. Releases from Indenture.................................. 41
Section 7.08. Covenant of Quiet Enjoyment.............................. 41
Section 7.09. Original Loan Participants' and Pass Through Trustee's
Representations and Warranties.......................... 41
Section 7.10. Survival of Representations, Warranties and Covenants.... 42
Section 7.11. Lessee's Assumption of the Certificates.................. 42
Section 7.12. Indebtedness of Owner Trustee............................ 44
Section 7.13. Compliance with Trust Agreement, Etc..................... 45
ARTICLE 8
TAXES
Section 8.01. Lessee's Obligation to Pay Taxes......................... 45
Section 8.02. After-Tax Basis.......................................... 51
Section 8.03. Time of Payment.......................................... 52
Section 8.04. Contests................................................. 52
Section 8.05. Refunds.................................................. 54
Section 8.06. Lessee's Reports......................................... 54
Section 8.07. Survival of Obligations.................................. 55
Section 8.08. Payment of Taxes......................................... 55
Section 8.09. Reimbursements by Indemnitees Generally.................. 55
ARTICLE 9
GENERAL INDEMNITY
Section 9.01. Generally................................................ 56
Section 9.02. After-Tax Basis.......................................... 59
Section 9.03. Subrogation.............................................. 60
Section 9.04. Notice and Payment....................................... 60
Section 9.05. Refunds.................................................. 60
Section 9.06. Defense of Claims........................................ 61
Section 9.07. Survival of Obligations.................................. 61
Section 9.08. Effect of Other Indemnities.............................. 62
Section 9.09. Interest................................................. 62
ARTICLE 10
TRANSACTION COSTS
Section 10.01. Transaction Costs and Other Costs....................... 62
ARTICLE 11
SUCCESSOR OWNER TRUSTEE
Section 11.01. Appointment of Successor Owner Trustee.................. 65
ARTICLE 12
LIABILITIES AND INTERESTS OF THE OWNER PARTICIPANT AND HOLDERS
Section 12.01. Liabilities of the Owner Participant.................... 66
Section 12.02. Interest of Holders of Certificates..................... 66
ARTICLE 13
OTHER DOCUMENTS
Section 13.01. Consent of Lessee to Other Documents.................... 67
Section 13.02. Further Assurances...................................... 67
Section 13.03. No Retroactive Application.............................. 67
ARTICLE 14
NOTICES
Section 14.01. Notices................................................. 68
ARTICLE 15
REFINANCING/REOPTIMIZATION
Section 15.01. Refinancing............................................. 69
Section 15.02. Reoptimization.......................................... 71
ARTICLE 16
[INTENTIONALLY LEFT BLANK]
ARTICLE 17
MISCELLANEOUS
Section 17.01. Owner for Federal Tax Purposes.......................... 73
Section 17.02. [Intentionally Left Blank.]............................. 73
Section 17.03. Counterparts............................................ 73
Section 17.04. No Oral Modifications................................... 73
Section 17.05. Captions................................................ 74
Section 17.06. Successors and Assigns.................................. 74
Section 17.07. Concerning the Owner Trustee, the Indenture Trustee
and the Pass Through Trustee........................... 74
Section 17.08. Severability............................................ 75
Section 17.09. Public Release of Information........................... 75
Section 17.10. Certain Limitations on Reorganization................... 75
Section 17.11. GOVERNING LAW........................................... 75
Section 17.12. Section 1110 Compliance................................. 76
ARTICLE 18
CONFIDENTIALITY
Section 18.01. Confidentiality......................................... 76
SCHEDULE I Certificate Information
SCHEDULE II Definitions
SCHEDULE III Permitted Country List
EXHIBIT A(1)(a) Opinion of Lessee's Counsel
EXHIBIT A(1)(b) Opinion of Lessee's Special Counsel
EXHIBIT A(2)(a) Opinion of Owner Participant's Special Counsel
EXHIBIT A(2)(b) Opinion of Owner Participant's Counsel
EXHIBIT A(3) Opinion of Indenture Trustee's Counsel
EXHIBIT A(4) Opinion of Special Aviation Counsel
EXHIBIT A(5) Opinion of Owner Trustee's Counsel
EXHIBIT A(6) Opinion of Pass Through Trustee's Special Counsel
EXHIBIT B Form of Lease Agreement
EXHIBIT C Form of Indenture
EXHIBIT D Form of Trust Agreement
PARTICIPATION AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N586FE)
PARTICIPATION AGREEMENT (FEDERAL EXPRESS CORPORATION TRUST NO.
N586FE) dated as of April 1, 1996, as amended and restated as of September 1,
1996 and as further amended and restated as of October 15, 1996 (this
"Agreement") among FEDERAL EXPRESS CORPORATION, a Delaware corporation
(herein, together with its successors and permitted assigns, the "Lessee"),
AMERITECH CREDIT CORPORATION, a Delaware corporation (herein, together with
its successors and permitted assigns, the "Owner Participant"), ▇▇▇▇▇▇
GUARANTY TRUST COMPANY OF NEW YORK, BANK OF AMERICA NATIONAL TRUST & SAVINGS
ASSOCIATION, THE CHASE MANHATTAN BANK, COMMERZBANK AG, ATLANTA AGENCY and
NATIONSBANK, N.A. (SOUTH), (individually, together with its successors and
permitted assigns, an "Original Loan Participant" and collectively the
"Original Loan Participants"), FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity, except as
otherwise expressly stated herein, but solely as owner trustee under the Trust
Agreement referred to below (in such capacity as trustee, together with its
successors and permitted assigns, the "Owner Trustee"), STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company, not in its individual capacity,
except as otherwise expressly stated herein, but solely as indenture trustee
under the Indenture referred to below (in such capacity as trustee, together
with its successors and permitted assigns, the "Indenture Trustee") and STATE
STREET BANK AND TRUST COMPANY, a Massachusetts trust company, not in its
individual capacity, except as otherwise expressly stated herein, but solely
as pass through trustee (in such capacity as trustee, together with its
successors and permitted assigns, the "Pass Through Trustee").
W I T N E S S E T H :
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have heretofore entered
into the Participation Agreement (Federal Express Corporation Trust No.
N586FE), dated as of April 1, 1996 among the Lessee, the Owner Participant,
the Owner Trustee, the Original Loan Participants and the Indenture Trustee,
as was originally executed on April 19, 1996 and amended and restated as of
September 1, 1996 by the Original Participation Agreement;
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee entered into the Original
Participation Agreement (such term, and all other terms not heretofore
defined, shall have the meanings assigned thereto as provided in Article 1
below), providing for the sale and lease of the Aircraft that was delivered on
the Delivery Date;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Participant entered into the Original Trust
Agreement relating to the Aircraft with FSB in its individual capacity,
pursuant to which FSB agreed, among other things, to hold the Lessor's Estate
in trust for the benefit of the Owner Participant;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Trustee and the Indenture Trustee entered
into the Original Indenture, for the benefit of the Original Loan
Participants, pursuant to which the Owner Trustee issued to the Original Loan
Participants the Original Loan Certificates as evidence of the loans made by
the Original Loan Participants to the Owner Trustee, the proceeds of which
were used by the Owner Trustee to pay a portion of the Purchase Price for the
Aircraft;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Trustee and the Lessee entered into the
Original Lease relating to the Aircraft, whereby, subject to the terms and
conditions set forth in said Lease, the Owner Trustee agreed to lease the
Aircraft to the Lessee, and the Lessee agreed to lease the Aircraft from the
Owner Trustee, such lease of the Aircraft being evidenced by the execution and
delivery of the Lease Supplement;
WHEREAS, Article 15 of the Original Participation Agreement permits a
Refinancing of the Original Loan Certificates subject to the satisfaction of
the conditions specified in Section 15.01 thereof, and Section 3.04 of the
Original Lease contemplates the adjustment of the percentages for Basic Rent,
Stipulated Loss Value, EBO Price and Termination Value in the event of such a
Refinancing, and the Lessee has requested that the Owner Trustee effect such a
Refinancing and adjustment;
WHEREAS, in order to facilitate such Refinancing, the Lessee is
concurrently entering into an Underwriting Agreement, which relates to two
series of Pass Through Certificates that will be issued by the Pass Through
Trusts formed to acquire, among other securities, the Certificates bearing a
particular interest rate and having a particular Maturity that will be issued
under the Indenture;
WHEREAS, on the Pass Through Closing Date, a closing will occur with
respect to the public offering of the Pass Through Certificates issued by each
Pass Through Trust, an allocable amount of the proceeds of which offering will
be used by the Pass Through Trustee to purchase for each such Pass Through
Trust the Certificates of the interest rate and Maturity applicable thereto,
the proceeds of which purchase in turn will be applied to the Refinancing in
full of the outstanding principal amount of the Original Loan Certificates and
the payment to the Owner Trustee of the Additional Leverage Amount;
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have agreed, subject to
the terms and conditions hereinafter provided, to amend and restate, and to
add the Pass Through Trustee as a party to, the Original Participation
Agreement; and
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have agreed, to the
extent they are parties thereto and, subject to the terms and conditions
hereinafter provided, to amend and restate the Original Indenture, to amend
and restate the Original Lease, to amend and restate the Original Ancillary
Agreement I, to amend the Original Tax Indemnity Agreement and to amend and
restate the Original Trust Agreement, each such amendment and restatement to
be executed and delivered simultaneously with the purchase of the Certificates
by the Pass Through Trustee for the Pass Through Trusts and the Refinancing in
full of the Original Loan Certificates.
NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereto agree, subject to the terms and
conditions hereinafter provided, that the Original Participation Agreement be
and the same is hereby amended and restated in its entirety as follows:
ARTICLE 1
DEFINITIONS
Unless the context otherwise requires, the terms defined in Schedule
II hereto are incorporated herein for all purposes of this Agreement and shall
be equally applicable to both the singular and the plural forms of the terms
so defined.
ARTICLE 2
ISSUANCE OF PASS THROUGH CERTIFICATES;
REFUNDING THE ORIGINAL LOAN CERTIFICATES
Section 2.01. Transfer of Funds.
(a) On or before the Pass Through Closing Date, the Pass Through
Trustee and the Lessee, in accordance with the Pass Through Agreement, shall
enter into the Series Supplements, and, subject to the terms and conditions
set forth therein, on the Pass Through Closing Date (i) the Lessee shall
direct the Underwriters to execute a wire transfer or intra-bank transfer to
the Pass Through Trustee in the amount of the total proceeds payable pursuant
to the Underwriting Agreement with respect to the Pass Through Certificates
and (ii) the Pass Through Trustee shall deliver the Pass Through Certificates
to the Underwriters upon receipt by the Pass Through Trustee of such proceeds.
(b) Subject to the satisfaction or waiver of the conditions set
forth herein, on the Refunding Date the following events shall occur in the
order set forth below:
(i) the Lessee shall on behalf of the Owner Trustee execute a wire
transfer or intra-bank transfer in favor of the Agent (as a prepayment of
the portion of Basic Rent allocable to the period from the Closing Date
through the Refunding Date) in the amount of all accrued and unpaid
interest on the Original Loan Certificates to but excluding the Refunding
Date, which transfer shall constitute the payment of all such accrued and
unpaid interest;
(ii)the Lessee shall on behalf of the Owner Trustee execute a wire
transfer or intra-bank transfer in favor of the Agent as Supplemental Rent
in the amount of any Breakage Costs required to be paid pursuant to the
Original Indenture which transfer shall constitute the payment of all such
Breakage Costs;
(iii)for each Pass Through Trust, from an allocable amount of the
proceeds of the sale of the related Pass Through Certificates, the Pass
Through Trustee shall pay on behalf of the Owner Trustee in the manner
specified in paragraph (iv) below, an amount equal to the principal amount
of Certificates of the Maturity and having the interest rate that relates
to such Pass Through Trust, which amounts in the aggregate shall equal the
aggregate principal amount of the Certificates as specified in Section 2.04
of the Indenture;
(iv)the aggregate amount payable by the Pass Through Trustee pursuant
to paragraph (iii) above shall be payable (A) by wire transfer or intra-bank
transfer in favor of the Agent on behalf of the Owner Trustee in the amount
of the outstanding principal amount of the Original Loan Certificates and
(B) by wire transfer in favor of the Owner Participant on behalf of the
Owner Trustee in the amount of the Additional Leverage Amount;
(v) the Agent shall apply the amounts received by it under paragraphs
(i), (ii) and (iv) of this subsection (b) to prepay the Original Loan
Certificates in full in accordance with Sections 2.06 and 2.10 of the
Original Indenture; and
(vi)the Owner Trustee shall cause the Certificates to be delivered to
the applicable Pass Through Trustee in accordance with Section 2.02 hereof.
On the Refunding Date concurrently with the events specified in
clauses (iii) through (v) of this Section 2.01(b), the parties hereto shall
execute and deliver, to the extent they are parties thereto, and consent to
the execution and delivery of (if they are not a party thereto), the
Indenture, the Lease and the Trust Agreement, and the Owner Trustee shall
execute and deliver to the Indenture Trustee for authentication, and the
Indenture Trustee shall authenticate and deliver to the applicable Pass Through
Trustee, upon the request of the Owner Trustee, the Certificates as provided
in Section 2.02 hereof. The Owner Participant hereby requests and directs the
Owner Trustee to execute and deliver this Agreement and, subject to the terms
hereof, to take the actions specified herein. The Original Loan Participants
by their execution and delivery hereof, request and direct the Indenture
Trustee to execute and deliver this Agreement and concurrently with the events
specified in clauses (iii) through (v) of this Section 2.01(b) and subject to
the terms and conditions hereof to take the actions contemplated herein. The
parties hereto, including, without limitation, the Original Loan Participants,
confirm that, as provided in Section 2.06 of the Original Indenture, upon
payment in full of the principal amount, Breakage Costs, if any, and interest
on the Original Loan Certificates and all other sums then payable to the
Original Loan Participants under the Original Agreements to the extent
specified in subsection (c) below, the Original Loan Participants shall have
no further interest in, or other right or obligation with respect to, the
Trust Indenture Estate, the Original Agreements or the Operative Agreements
(it being understood that the foregoing shall not limit or detract from any
claim that any Original Loan Participant may have under Article 8 or 9 or
Section 10.01(a)(ii) hereof or of the Original Participation Agreement) and,
accordingly, have no obligation to, and will not attempt to direct any future
actions of the Indenture Trustee with respect to the Trust Indenture Estate,
provided that the rights and obligations of the Original Loan Participants
shall, until the payment in full of such amounts to the Agent on behalf of the
Original Loan Participants on the Refunding Date, be governed by the Original
Participation Agreement and the other Operative Agreements contemplated
thereby or in effect immediately prior to the effectiveness of this Agreement
and shall, upon such payment and thereafter, be governed by this Agreement.
The Lessee hereby consents to the foregoing.
(c) Not less than three (3) Business Days prior to the Refunding
Date, the Agent on behalf of the Original Loan Participants shall give notice
in writing to the parties hereto of the principal amount, Breakage Costs, if
any, and interest on and all other amounts due on the Refunding Date under the
Original Loan Certificates and all other sums payable on the Refunding Date to
the Original Loan Participants under the Original Agreements, such notice to
be deemed final and binding on the Original Loan Participants as to the
respective amounts of principal, Breakage Costs, if any, and interest when
given; provided that the expected Refunding Date, at the time such notice is
given, is the same as the Refunding Date.
(d) On the Refunding Date, subject to (i) the giving of the written
notice referred to in Section 2.01(c) above to the Indenture Trustee and the
Original Loan Participants, (ii) the receipt by the Original Loan Participants
of the funds referred to in Section 2.01(b)(v) above and (iii) compliance with
the provisions of Article 15 of the Original Participation Agreement and
Section 2.10(c) of the Original Indenture (including the Refinancing in full
of the Original Loan Certificates), the Original Loan Participants shall
deliver the Original Loan Certificates to the Indenture Trustee for
cancellation and delivery to the Owner Trustee.
(e) The closing with respect to the acquisition of the Pass Through
Certificates by the Underwriters and the closing with respect to the
Refinancing of the Original Loan Certificates (together, the "Closings") shall
take place at the offices of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
(f) All payments pursuant to this Section 2.01 shall be made in
immediately available funds.
(g) In the event that the Refunding Date and the actions
contemplated to occur on such date pursuant to subsection (d) of this Section
2.01 do not occur on or before November 30, 1996, then the rights and
obligations of the parties to the Original Participation Agreement, including,
without limitation, the Original Loan Participants, shall be governed by the
Original Participation Agreement and the other Operative Agreements
contemplated thereby or in effect immediately prior to the effectiveness of
this Agreement and this Agreement shall be of no further force and effect,
except that the Lessee shall be obligated hereby to pay all fees and expenses
of the Original Loan Participants, the Indenture Trustee, the Owner
Participant, the Owner Trustee, the Pass Through Trustee and their respective
counsel relating to the transactions contemplated hereby. Each of the parties
hereto agrees to execute and deliver to the other parties such documents and
instruments as may be necessary to give effect to the foregoing provisions of
this subsection (g).
Section 2.02. Certificates. Subject to the satisfaction or waiver
of the conditions set forth herein, on the Refunding Date, the Owner Trustee
shall execute and deliver to the Indenture Trustee, and the Indenture Trustee
shall authenticate and deliver, upon the request of the Owner Trustee, to the
Pass Through Trustee for each Pass Through Trust, the Certificate specified
for such Pass Through Trust on Schedule I attached hereto, which (i) shall be
issued in the principal amount and in the Maturity set forth for such
Certificate in Schedule I hereto, (ii) shall bear interest at the interest
rate set forth for such Certificate in Schedule I hereto, (iii) shall be
issued in such form and on such terms as are specified in the Indenture, (iv)
shall be dated and authenticated on the Refunding Date and shall bear interest
from the Refunding Date and (v) shall be registered in the name of the Pass
Through Trustee on behalf of such Pass Through Trust.
ARTICLE 3
EXTENT OF INTEREST OF ORIGINAL LOAN PARTICIPANTS
Section 3.01. Extent of Interest of Original Loan Participants.
Delivery of the Original Loan Certificates by the Original Loan Participants
to the Indenture Trustee for cancellation on the Refunding Date shall be
conclusive evidence of receipt by the Original Loan Participants of all
amounts then due and payable to the Original Loan Participants in respect of
principal of, Breakage Costs, if any, and interest on the Original Loan
Certificates under the Original Agreements (it being understood that the
foregoing shall not limit or detract from any claim any Original Loan
Participant may have under Article 8 or 9 or Section 10.01(a)(ii) hereof or of
the Original Participation Agreement).
ARTICLE 4
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent. The obligations of the Owner
Trustee, the Owner Participant, the Lessee, the Indenture Trustee and the Pass
Through Trustee on behalf of each Pass Through Trust to participate in the
transactions contemplated hereby on the Refunding Date are subject to the
fulfillment to the satisfaction of such party (or waiver by such party), prior
to or on the Refunding Date, of the following conditions precedent (it being
understood that receipt by the Lessee of any of the following documents shall
not be a condition precedent to the obligations of any party):
(a) Certificates. On the Refunding Date, there shall have been duly
issued and delivered by the Owner Trustee to the Pass Through Trustee for
each Pass Through Trust, against payment therefor, a Certificate,
substantially in the form set forth in Exhibit B to the Indenture, duly
authenticated, dated the Refunding Date and registered in the name of the
Pass Through Trustee on behalf of such Pass Through Trust, in the principal
amounts, Maturity, bearing the interest rate and the other economic terms
specified in the Series Supplements and otherwise as provided in Section
2.04 of the Indenture. The Pass Through Certificates shall be registered
under the Securities Act, any applicable state securities laws shall have
been complied with, and the Pass Through Agreement shall have been qualified
under the Trust Indenture Act.
(b) Legal Investment. On the Refunding Date, no fact or condition
shall exist under applicable laws or regulations, or interpretations of any
such laws or regulations by applicable regulatory authorities, which, in
the opinion of the Owner Participant or its special counsel, the Pass
Through Trustee or the Indenture Trustee or their special counsel, would
make it illegal for the Owner Participant, the Lessee, the Owner Trustee,
the Pass Through Trustee or the Indenture Trustee, and no change in
circumstances outside the control of the Owner Participant shall have
occurred which would otherwise make it illegal for the Owner Participant,
the Lessee, the Owner Trustee, the Pass Through Trustee or the Indenture
Trustee, to participate in the transactions to be consummated on the
Refunding Date; and no action or proceeding shall have been instituted nor
shall governmental action before any court, governmental authority or
agency be threatened which in the opinion of counsel for the Owner
Participant, the Indenture Trustee or the Pass Through Trustee is not
frivolous, nor shall any order have been issued or proposed to be issued by
any court, or governmental authority or agency, as of the Refunding Date,
to set aside, restrain, enjoin or prevent the consummation of any of the
transactions contemplated by this Agreement or by any of the other Operative
Agreements.
(c) Underwriters. The Underwriters shall have transferred the funds
specified in Section 2.01(a) hereof and all conditions thereunder shall
have been satisfied or waived.
(d) Refunding Documents. This Agreement and the following documents
shall have been duly authorized, executed and delivered by the respective
party or parties thereto, shall each be satisfactory in form and substance
to the Lessee, the Owner Trustee, the Indenture Trustee, the Pass Through
Trustee and the Owner Participant (each acting directly or by authorization
to its special counsel) and shall each be in full force and effect; there
shall not have occurred any default thereunder, or any event which with the
lapse of time or the giving of notice or both would be a default
thereunder, and copies executed or certified as requested by the Lessee,
the Owner Trustee, the Indenture Trustee, the Pass Through Trustee or the
Owner Participant, as the case may be, of such documents shall have been
delivered to the Owner Participant, the Lessee, the Indenture Trustee, the
Pass Through Trustee and the Owner Trustee (provided that the sole
chattel-paper original of each of the Lease, the Lease Supplement and each
Ancillary Agreement amendatory of the Lease, shall be delivered to the
Indenture Trustee):
(i) the Lease;
(ii) the Indenture;
(iii) in the case of the Owner Participant only, Amendment No. 1 to
the Original Tax Indemnity Agreement;
(iv) the Trust Agreement;
(v) the Ancillary Agreement I; and
(vi) the Ancillary Agreement II.
(e) Insurance. Each of the Indenture Trustee, the Pass Through
Trustee, the Owner Trustee and the Owner Participant shall have received
such evidence as it deems appropriate, including, without limitation, an
independent insurance broker's report, together with certificates of
insurance from such broker, in form and substance satisfactory to the
Indenture Trustee, the Pass Through Trustee, the Owner Trustee and the
Owner Participant to establish that the insurance required by Article 13 of
the Lease is in effect.
(f) Financing Statements. (i) Uniform Commercial Code ("UCC")
financing statements covering all the security interests (and other
interests) created by or pursuant to the Granting Clause of the Original
Indenture shall have been executed and delivered by the Owner Trustee, as
debtor, and by the Indenture Trustee, as secured party, for and on behalf
of the Original Loan Participants, and such financing statements shall have
been duly filed in the State of Utah; (ii) a form UCC-3 financing statement
to amend and restate each financing statement referred to in the
immediately preceding sentence shall have been executed and delivered by
the Owner Trustee, as debtor, and by the Indenture Trustee as secured
party, and a form UCC-1 financing statement covering all the security
interests (and other interests) created by or pursuant to the Granting
Clause of the Indenture shall have been executed and delivered by the Owner
Trustee, as debtor, and by the Indenture Trustee, as secured party, for and
on behalf of the Holders, and concurrently with the Refinancing of the
Original Loan Certificates such UCC-3 financing statement and UCC-1
financing statement shall have been duly filed or duly submitted for filing
in the State of Utah, and all other actions shall have been taken which, in
the opinion of special counsel for the Pass Through Trustee or for the
Underwriters, are necessary or desirable to maintain the perfection of the
security interest created by or pursuant to the Granting Clause of the
Indenture; (iii) a UCC notice filing describing the Original Lease as a
lease shall have been executed and delivered by the Owner Trustee, as
lessor, and the Lessee, as lessee (which filing shall name the Indenture
Trustee as assignee of the Owner Trustee), and shall have been duly filed
in the State of Tennessee; and (iv) a form UCC-3 financing statement to
amend and restate the UCC notice filing referred to in the immediately
preceding clause (iii) shall have been executed and delivered by the Owner
Trustee, as lessor, and by the Lessee, as lessee (which filing shall name
the Indenture Trustee as assignee of the Owner Trustee), and such notice
filing shall concurrently with the Refinancing of the Original Loan
Certificates have been duly filed in the State of Tennessee, and all other
actions shall have been taken which, in the opinion of the Owner
Participant, Pass Through Trustee and the Underwriters, are necessary to
perfect and protect such security interests and other interests created by
or pursuant to the Granting Clause of the Indenture.
(g) Corporate Documents. Except when such Person is the delivering
party, the Owner Participant, the Owner Trustee, the Original Loan
Participants, the Pass Through Trustee, the Lessee and the Indenture
Trustee (acting directly or by authorization to its counsel) shall have
received the following, in each case in form and substance satisfactory to
it:
(i) a copy of the certificate of incorporation and by-laws of
the Lessee, certified by the Secretary or an Assistant Secretary of
the Lessee as of the Refunding Date, and a copy of the minutes of the
regular meeting of the board of directors of the Lessee, certified as
such as of the Refunding Date by such Secretary or Assistant
Secretary, duly authorizing the lease by the Lessee of the Aircraft
under the Lease and the execution, delivery and performance by the
Lessee of the Original Agreements to which it is a party, this
Agreement, the Lease, the Tax Indemnity Agreement, the Pass Through
Agreement, the Series Supplements, the other Operative Agreements to
which the Lessee is or is to be a party and each other document to be
executed and delivered by the Lessee in connection with the
transactions contemplated hereby;
(ii) a copy of the articles of incorporation and bylaws of the
Owner Participant, certified by the Secretary or an Assistant
Secretary of the Owner Participant as of the Refunding Date, and a
copy of the resolutions of the sole stockholder of the Owner
Participant, certified as such as of the Refunding Date by such
Secretary or an Assistant Secretary, authorizing the execution and
delivery by the Owner Participant of the Original Agreements to which
it is a party, this Agreement, the Tax Indemnity Agreement, the Trust
Agreement and the other Operative Agreements to which the Owner
Participant is or is to be a party and each other document to be
executed and delivered by the Owner Participant in connection with
the transactions contemplated hereby;
(iii) a copy of the articles of association and by-laws and
other instruments of the Owner Trustee, certified by the Secretary or
an Assistant Secretary of the Owner Trustee as of the Refunding Date
(or other like instruments satisfactory to the Lessee and the Owner
Participant) and evidence authorizing the execution, delivery and
performance by the Owner Trustee in its individual capacity or as
Owner Trustee, as the case may be, of the Original Agreements to
which it is a party, this Agreement, the Trust Agreement and each of
the other Operative Agreements to which it is or is to be a party,
whether in its individual capacity or as Owner Trustee, and each
other document to be executed and delivered by the Owner Trustee in
connection with the transactions contemplated hereby;
(iv) a copy of the certificate of incorporation and by-laws
and other instruments of the Indenture Trustee, certified by the
Secretary or an Assistant Secretary of the Indenture Trustee as of
the Refunding Date (or other like instruments satisfactory to the
Lessee and the Owner Participant) and evidence authorizing the
execution, delivery and performance by the Indenture Trustee of each
of the Original Agreements to which it is party, this Agreement, the
Indenture and each of the other Operative Agreements to which it is
or is to be a party, and each other document to be executed and
delivered by the Indenture Trustee in connection with the transactions
contemplated hereby;
(v) a copy of the certificate of incorporation and by-laws
and other instruments of the Pass Through Trustee, certified by the
Secretary or an Assistant Secretary of the Pass Through Trustee as of
the Refunding Date (or other like instruments satisfactory to the
Lessee and the Owner Participant) and evidence authorizing the
execution, delivery and performance by the Pass Through Trustee of
this Agreement, the Pass Through Agreement, the Series Supplements
and each of the other Operative Agreements to which it is or is to be
a party, and each other document to be executed and delivered by the
Pass Through Trustee in connection with the transactions contemplated
hereby; and
(vi) such other documents, evidences, materials, and
information with respect to the Lessee, the Owner Trustee, the
Indenture Trustee, the Pass Through Trustee and the Owner Participant
as the Indenture Trustee, the Pass Through Trustee or the Owner
Participant may reasonably request in order to establish the
consummation of the transactions contemplated by this Agreement.
(h) Title, Airworthiness and Registration. On the Refunding Date,
the following statements shall be true, and the Owner Participant, the
Owner Trustee, the Pass Through Trustee and the Indenture Trustee shall
have received evidence from the Lessee reasonably satisfactory to each such
Person to the effect that:
(i) the Owner Trustee has good and marketable title to the
Aircraft, free and clear of Liens, except the rights of the Owner
Trustee and the Lessee under the Lease and the Lease Supplement
covering the Aircraft, the rights of the Indenture Trustee under the
Indenture and the beneficial interest of the Owner Participant
created by the Trust Agreement and the interest of the Holders
created by the Indenture and the Indenture and Security Supplement
covering the Aircraft;
(ii) the Aircraft has been duly certificated by the Aeronautics
Authority as to type and airworthiness in accordance with the terms
of the Operative Agreements;
(iii) the Lease, the Indenture and the Trust Agreement
concurrently with the Refinancing of the Original Loan Certificates
have been duly filed for recordation (or shall be in the process of
being so duly filed for recordation) with the Aeronautics Authority
pursuant to the Transportation Code; and
(iv) the Aircraft is registered in the name of the Owner
Trustee.
(i) Officer's Certificate of Lessee. On the Refunding Date, the
following statements shall be true, and the Owner Participant, the Owner
Trustee, the Pass Through Trustee and the Indenture Trustee shall have
received a certificate signed by the Vice President and Treasurer or any
other duly authorized officer of the Lessee, dated the Refunding Date,
stating that:
(i) the representations and warranties of the Lessee
contained in the Operative Agreements to which it is a party
(excluding the Tax Indemnity Agreement) and in any certificate
delivered pursuant hereto or thereto are true and correct on and as
of the Refunding Date 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 certificate shall state that
such representations and warranties were true and correct on and as
of such earlier date);
(ii) except for the matters described (i) under "Legal
Proceedings" in the Lessee's Annual Report on Form 10-K for the
fiscal year ended May 31, 1996 (as updated by Note 7 to the financial
statements included in the Lessee's Quarterly Report on Form 10-Q for
the fiscal quarter ended August 31, 1996) and (ii) in the Lessee's
Current Reports on Form 8-K dated June 7, 1996 and August 16, 1996,
as to which such officer will make no certification concerning the
liability of the Lessee (if any), or the effect of any adverse
determination upon the consolidated financial condition, business or
operations of the Lessee, no material adverse change has occurred in
the financial condition, business or operations of the Lessee from
that shown in the unaudited consolidated financial statements of the
Lessee as of August 31, 1996 and nothing has occurred which will, in
the judgment of such officer, materially adversely affect the ability
of the Lessee to carry on its business or to perform its obligations
under this Agreement and each other Operative Agreement to which it
is or is to be a party; and
(iii) no event has occurred and is continuing, or would result
from the purchase, sale, mortgage, or lease of the Aircraft, which
constitutes an Event of Loss (or event which with the passage of time
would become an Event of Loss) with respect to the Airframe or any
Engine, or a Default or an Event of Default under the Lease.
(j) Officer's Certificate of Owner Participant. On the Refunding
Date, the following statements shall be true, and the Lessee, the Pass
Through Trustee, the Owner Trustee and the Indenture Trustee shall have
received a certificate from the Owner Participant, signed by a duly
authorized officer of the Owner Participant dated the Refunding Date,
stating that:
(i) the representations and warranties of the Owner
Participant contained in this Agreement, the Trust Agreement and any
other Operative Agreement to which it is a party and in any
certificate delivered pursuant hereto or thereto, are true and
correct on and as of the Refunding Date 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
certificate shall state that such representations and warranties were
true and correct on and as of such earlier date);
(ii) no Lessor's Liens attributable to the Owner Participant
exist; and
(iii) no event has occurred and is continuing which constitutes
or, with notice or lapse of time or both would constitute, due to any
action or inaction on the part of the Owner Participant, an Indenture
Event of Default other than an Indenture Event of Default
attributable to a Lease Event of Default.
(k) Other Officer's Certificates. On the Refunding Date, the
following statements shall be true, and the Owner Participant, the Lessee,
the Pass Through Trustee, the Owner Trustee and the Indenture Trustee shall
have received a certificate from each of FSB and the Owner Trustee (in the
case of the Lessee, the Pass Through Trustee, the Owner Participant and the
Indenture Trustee), SSB and the Indenture Trustee (in the case of the
Lessee, the Pass Through Trustee, the Owner Participant and the Owner
Trustee) and SSB and the Pass Through Trustee (in the case of the Lessee,
the Indenture Trustee, the Owner Participant and the Owner Trustee) signed
by a duly authorized officer of FSB and SSB, respectively, dated the
Refunding Date, stating with respect to FSB and the Owner Trustee, with
respect to SSB and the Indenture Trustee, or with respect to SSB and the
Pass Through Trustee, as the case may be, that:
(i) the representations and warranties of FSB in its
individual capacity and as Owner Trustee, of SSB in its individual
capacity and as Indenture Trustee and of SSB in its individual
capacity and as Pass Through Trustee contained in this Agreement, the
Lease, the Trust Agreement and the Indenture and in any certificate
delivered pursuant hereto or thereto are true and correct on and as
of the Refunding Date 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 certificate shall state that
such representations and warranties were true and correct on and as
of such earlier date);
(ii) to the best of its knowledge, no event has occurred and is
continuing, which constitutes or which, but for the lapse of time or
the giving of notice, or both, would constitute, due to any action or
omission on the part of FSB in its individual capacity or as Owner
Trustee, of SSB in its individual capacity or as Indenture Trustee
and of SSB in its individual capacity or as Pass Through Trustee, an
Event of Default or an Indenture Event of Default; and
(iii) there are no Lessor's Liens attributable to the Owner
Trustee or FSB and no Indenture Trustee's Liens affecting the Trust
Indenture Estate or the Lessor's Estate or any part thereof.
(l) Legal Opinions. The Owner Participant, the Agent, the Original
Loan Participants, the Underwriters, the Lessee, the Owner Trustee, the
Pass Through Trustee and the Indenture Trustee (acting directly or by
authorization to its special counsel) shall have received from the
following counsel their respective legal opinions in each case satisfactory
to the Owner Participant, the Agent, the Original Loan Participants, the
Underwriters, the Lessee, the Owner Trustee, the Pass Through Trustee or
the Indenture Trustee, as the case may be, as to scope and substance (and
covering such other matters as the recipient may reasonably request) and
dated the Refunding Date:
(i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Law of the Lessee, in
the form of Exhibit A(1)(a) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Owner Trustee, the Pass Through Trustee and the Indenture Trustee;
(ii) Winston & ▇▇▇▇▇▇, special New York counsel for the Owner
Participant, in the form of Exhibit A(2)(a) hereto and ▇▇▇▇▇ ▇. ▇▇▇▇▇,
counsel for the Owner Participant, in the form of Exhibit A(2)(b)
hereto, each addressed to the Agent, the Original Loan Participants,
the Underwriters, the Owner Participant, the Indenture Trustee, the
Owner Trustee, the Pass Through Trustee and the Lessee;
(iii) ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel for the
Indenture Trustee, in the form of Exhibit A(3) hereto and addressed
to the Agent, the Original Loan Participants, the Underwriters, the
Owner Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee;
(iv) ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special aviation counsel,
in the form of Exhibit A(4) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Lessee;
(v) Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel for the Owner
Trustee, in the form of Exhibit A(5) hereto and addressed to the
Agent, the Original Loan Participants, the Underwriters, the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee;
(vi) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Lessee, in
the form of Exhibit A(1)(b) hereto addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Lessee; and
(vii) ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel for the Pass
Through Trustee, in the form of Exhibit A(6) hereto and addressed to
the Agent, the Original Loan Participants, the Underwriters, the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee.
(m) No Indenture Event of Default. No Indenture Event of Default or
Indenture Default has occurred and is continuing.
(n) Event of Default; Default; Event of Loss. No Default or Event
of Default under the Lease or Event of Loss or event, which with the
passage of time or if continued unremedied or unaltered would constitute an
Event of Loss, shall have occurred or be in existence.
(o) Cancellation. Following the Refinancing of the Original Loan
Certificates, the Original Loan Certificates shall have been duly delivered
by the Original Loan Participants to the Indenture Trustee for cancellation
and delivery to the Owner Trustee.
(p) Other Agreements. The Lessee and the Pass Through Trustee shall
have entered into the Pass Through Agreement and the Series Supplements, all
conditions to the effectiveness of each thereof shall have been satisfied
or waived, and the Pass Through Certificates shall have been issued
pursuant to the Series Supplements. The Lessee and the Underwriters shall
have entered into the Underwriting Agreement, all conditions to the
effectiveness thereof shall have been satisfied or waived, and the Pass
Through Certificates shall have been delivered pursuant to the Underwriting
Agreement.
(q) Material Adverse Change. There shall not have occurred any
material adverse change in the consolidated financial condition, business
or operations of the Lessee from that set forth in its financial statements
as of August 31, 1996 referred to in Section 6.01(l) hereof.
Section 4.02. Opinion of Special Aviation Counsel. Promptly upon
the filing and, where appropriate, recording of the documents specified in
4.01(h)(iii) hereof, pursuant to the Transportation Code the Lessee shall
cause Special Aviation Counsel to deliver to the Owner Participant, the Owner
Trustee, the Pass Through Trustee and the Indenture Trustee an opinion as to
(i) the due recording of such documents and the documents identified in
Section 4.01(i) of the Original Participation Agreement and (ii), subject to
customary qualifications, the lack of any intervening documents with respect
to the Aircraft.
ARTICLE 5
CONDITIONS PRECEDENT TO LESSEE'S OBLIGATIONS
Section 5.01. Conditions Precedent to Lessee's Obligations. The
Lessee's obligation to participate in the transactions contemplated hereby is
subject to the conditions that, prior to or on the Refunding Date, the Lessee
shall have received the certificates and other documents which are referred to
in, or the opinions to be addressed to it under, as the case may be,
paragraphs (d), (g)(ii)-(v), (h)(ii)-(iv), (j), (k) and (l)(ii), (iii), (iv),
(v), (vi) and (vii) of Section 4.01 hereof and the Underwriters and the Owner
Participant shall have made available the amounts required to be paid by them
pursuant to Section 2.01 hereof.
ARTICLE 6
LESSEE'S REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 6.01. Lessee's Representations and Warranties. The Lessee
represents and warrants to the Owner Participant, the Owner Trustee (in its
individual capacity and as Owner Trustee), the Pass Through Trustee (in its
individual capacity and as Pass Through Trustee) and the Indenture Trustee (in
its individual capacity and as Indenture Trustee) that, on the date hereof and
as of the Refunding Date:
(a) the Lessee is a corporation duly organized and validly existing
and is in good standing under the laws of the State of Delaware with its
principal place of business and chief executive office (as such terms are
used in Article 9 of the Uniform Commercial Code) in Memphis, Tennessee,
and is duly qualified to do business as a foreign corporation and is in
good standing in all jurisdictions in which it has intrastate routes, or
offices or major overhaul facilities or in which other activities of the
Lessee require such qualification;
(b) the Lessee has full power, authority and legal right to conduct
its business and operations as currently conducted and to own or hold under
lease its Properties and to enter into and perform its obligations under
this Agreement, the Original Agreements to which it is a party, the other
Operative Agreements to which it is a party, the Pass Through Agreement and
the Series Supplements (the "Lessee Documents");
(c) the Lessee is an "air carrier" within the meaning of the
Transportation Code and a holder of a certificate under Sections 41102(a)
and 41103 of the Transportation Code and a "citizen of the United States"
within the meaning of Section 40102(a)(15) of the Transportation Code
holding an "air carrier operating certificate" issued under Chapter 447 of
the Transportation Code for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, and each such certificate is
in full force and effect;
(d) the Lessee possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents (collectively
"permits") which are material to the operation of the routes flown by it
and the conduct of its business and operations as currently conducted and
each such permit is in full force and effect;
(e) the execution, delivery and performance of the Lessee Documents
by the Lessee have been duly authorized by all necessary corporate action
on the part of the Lessee and do not require any stockholder approval, or
approval or consent of any trustee or holder of any indebtedness or
obligations of the Lessee, and each such document has been duly executed
and delivered by the Lessee and constitutes the legal, valid and binding
obligations of the Lessee enforceable against it in accordance with the
terms thereof except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws or equitable
principles of general application to or affecting the enforcement of
creditors' rights generally (regardless of whether enforceability is
considered in a proceeding in equity or at law);
(f) no authorization, consent or approval of or other action by, and
no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by the Lessee of the Lessee Documents or for the
use and maintenance of the Aircraft except for such registrations,
applications and recordings referred to in the opinions of Special Aviation
Counsel delivered or to be delivered pursuant to Sections 4.01(l)(iv) and
4.02 hereof and except for the filings referred to in Section 4.01(f)
hereof, all of which shall have been duly obtained or made and shall be in
full force and effect on and as of the Refunding Date or as contemplated by
said Sections;
(g) neither the execution, delivery or performance by the Lessee of
the Lessee Documents nor compliance with the terms and provisions hereof or
thereof, conflicts or will conflict with or results or will result in a
breach or violation of any of the terms, conditions or provisions of, or
will require any consent or approval under, any law, governmental rule or
regulation or the charter documents, as amended, or bylaws, as amended, of
the Lessee or any order, writ, injunction or decree of any court or
governmental authority against the Lessee or by which it or any of its
Properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which the Lessee is a party or by which it or
any of its Properties is bound, or constitutes or will constitute a default
thereunder or results or will result in the imposition of any Lien upon any
of its Properties;
(h) there are no pending or, to the knowledge of the Lessee,
threatened actions, suits, investigations or proceedings (whether or not
purportedly on behalf of the Lessee) against or affecting the Lessee or any
of its Property before or by any court or administrative agency which (A)
involve the Aircraft, (B) except for the matters described (i) under "Legal
Proceedings" in the Lessee's Annual Report on Form 10-K for the fiscal year
ended May 31, 1996 (as updated by Note 7 to the financial statements
included in the Lessee's Quarterly Report on Form 10-Q for the fiscal
quarter ended August 31, 1996) and (ii) in the Lessee's Current Reports on
Form 8-K dated June 7, 1996 and August 16, 1996, as to which no
representation is made concerning the Lessee's liability (if any) or the
effect of any adverse determination upon the consolidated financial
condition, business or operations of the Lessee, if adversely determined,
would materially and adversely affect the consolidated financial condition,
business or operations of the Lessee, or (C) if adversely determined would
adversely affect the ability of the Lessee to perform its obligations under
the Lessee Documents;
(i) the Lessee has filed or caused to be filed all tax returns which
are required to be filed and has paid or caused to be paid all taxes shown
to be due and payable pursuant to such returns or pursuant to any
assessment received by the Lessee (other than assessments the payment of
which is being contested in good faith by the Lessee by appropriate
proceedings that do not involve any material danger of sale, forfeiture or
loss of the Aircraft or any part thereof), and the Lessee has no knowledge
of any related actual or proposed deficiency or additional assessment which
either in any case or in the aggregate would materially adversely affect
the Lessee's consolidated financial condition (other than, in any such case,
assessments, the payment of which is being contested in good faith by the
Lessee, as to which no representation is made concerning the Lessee's
liability (if any) or the effect of any adverse determination upon the
Lessee's consolidated financial condition);
(j) except for (A) the filing and, where appropriate, recordation
pursuant to the Transportation Code of the Indenture, the Trust Agreement
and the Lease, (B) the filing of the financing statements referred to in
Section 4.01(f) hereof and (C) the taking of possession by the Indenture
Trustee of the original counterpart of the Lease and maintaining possession
of the original counterpart of the Lease Supplement delivered on the
Delivery Date, no further action, including any filing or recording of any
document, is necessary or advisable in order (i) to establish the Owner
Trustee's title to and interest in the Aircraft and the Lessor's Estate as
against the Lessee and any third parties, or (ii) to perfect the first
security interests in and mortgage Lien on the Trust Indenture Estate in
favor of the Indenture Trustee;
(k) on the Delivery Date, the Owner Trustee received good and
marketable title to the Aircraft, free and clear of all Liens, except the
rights of the Owner Trustee and the Lessee under the Original Lease, the
rights of the Indenture Trustee under the Original Indenture, the
beneficial interest of the Owner Participant created by the Original Trust
Agreement and the interest of the Original Loan Participants created by the
Original Indenture and the Indenture and Security Agreement Supplement
covering the Aircraft;
(l) the Lessee has heretofore delivered to the Owner Participant
true and correct copies of the Lessee's Annual Report on Form 10-K for the
fiscal year ended May 31, 1996 and its Quarterly Report on Form 10-Q for
the fiscal quarter ended August 31, 1996, and of the audited consolidated
balance sheet of the Lessee for the fiscal year ended May 31, 1996 and the
unaudited consolidated balance sheet of the Lessee as of August 31, 1996,
and the related consolidated statements of income, changes in common
stockholders' investment and cash flows for the fiscal year and interim
reporting period ended on such dates, accompanied (except in the case of
such interim reporting period) by a report thereon containing opinions
without qualification, except as therein noted, by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP,
independent public accountants; said financial statements have been
prepared in accordance with generally accepted accounting principles
consistently applied and present fairly the financial position of the
Lessee as of such dates and the results of its operations and cash flows
for such periods and such Annual Report, Quarterly Report and financial
statements did not, as of their respective dates of filing with the SEC,
contain any untrue statement of a material fact or omit a material fact
necessary to make the statements contained therein not misleading;
(m) with respect to ERISA:
(i) none of the Pension Plans (as hereinafter defined) nor
their related trusts have been terminated in a distress termination
pursuant to Section 4041(c) of ERISA or by the PBGC (as hereinafter
defined) pursuant to Section 4042 of ERISA, nor have any actions been
taken to so terminate any Pension Plan or related trust and neither
the Lessee nor any ERISA Affiliate (as hereinafter defined) has
incurred or could reasonably be expected to incur any material
liability with respect to a Pension Plan under Section 4062, 4063,
4064 or 4069 of ERISA;
(ii) there have been no "reportable events" (as such term is
defined in Section 4043(b) of ERISA) with respect to any Pension Plan
which have resulted or could reasonably be expected to result in any
material liability of the Lessee or any ERISA Affiliate;
(iii) no "accumulated funding deficiency" (as such term is
defined in Section 302 of ERISA or Section 412 of the Code) exists
with respect to any Pension Plan, whether or not waived, nor has any
request for a waiver under Section 412(d) of the Code been, or is
reasonably likely to be, filed with respect to any of the Pension
Plans;
(iv) neither the Lessee nor any ERISA Affiliate has failed to
make any contribution or payment to any Pension Plan which has
resulted or could reasonably be expected to result in the imposition
of a Lien under Section 302(f) of ERISA or Section 412(n) of the Code;
(v) all Pension Plans are in compliance in all material
respects with all applicable provisions of ERISA and the Code;
(vi) neither the Lessee nor any ERISA Affiliate has incurred
or is reasonably likely to incur any material withdrawal liability
pursuant to Section 4201 or 4204 of ERISA or any material liability
under Section 515 of ERISA;
(vii) to the best of the Lessee's knowledge, neither the Lessee
nor any ERISA Affiliate has engaged in a "prohibited transaction"
(within the meaning of Section 4975 of the Code or Section 406 of
ERISA) which could reasonably be expected to subject the Lessee to
the tax or penalties on prohibited transactions imposed by Section
4975 of the Code or Section 502 of ERISA; and
(viii) assuming the truth of the representations contained in
Sections 7.03(a)(viii) and 7.09 hereof and compliance with Section
10.06 of the Indenture, the execution and delivery of this Agreement
and the other Operative Agreements and the consummation of the
transactions contemplated hereby and thereby will not involve any
non-exempt transaction which is prohibited by Section 406 of ERISA or
in connection with which a tax could be imposed pursuant to Section
4975 of the Code. No part of the funds to be used by the Lessee in
satisfaction of its obligations under this Agreement or any other of
the Operative Agreements to which the Lessee is a party or to which
the Lessee is bound are the assets (within the meaning of ERISA and
any applicable rules and regulations) of any employee benefit plan
subject to Title I of ERISA, or any individual retirement account or
an employee benefit plan subject to Section 4975 of the Code.
As used in this Section 6.01(m), the term "Pension Plan" means an employee
pension benefit plan as defined in Section 3(2) of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA) which is
covered by Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code and which is (or, solely for purposes of
clause (i) of this Section 6.01(m), within the preceding 5 calendar years
has been) maintained, or contributed to, by the Lessee or any ERISA
Affiliate; the term "PBGC" means Pension Benefit Guaranty Corporation and
any successor agency or instrumentality thereto; and the term "ERISA
Affiliate" means any entity which together with the Lessee would be treated
as a single employer under Section 414(b), (c), (m) or (o) of the Code;
(n) the Lessee is a Citizen of the United States;
(o) except for the filings referred to in Section 4.01(f) hereof, no
governmental approval of any kind is required of the Owner Participant or
for the Owner Participant's execution of or performance under this
Agreement or any agreement contemplated hereby by reason of any fact or
circumstance of the Lessee, the nature of the Aircraft or the Lessee's
proposed operations or use of the Aircraft;
(p) on the Refunding Date, all premiums with respect to the insurance
required to be provided by the Lessee on or prior to the Refunding Date
under Article 13 of the Lease have been paid by the Lessee;
(q) on the Refunding Date, all sales or use taxes relating to the
sale of the Aircraft by the Lessee to the Owner Trustee which are then or
were theretofore due shall have been paid;
(r) the Lessee is not in default under any mortgage, deed of trust,
indenture, lease or other instrument or agreement to which the Lessee is a
party or by which it or any of its Properties or assets may be bound, or in
violation of any applicable law, which default or violation would have a
material adverse effect on the financial condition, business or operations
of the Lessee or its ability to perform any of its obligations under the
Lessee Documents;
(s) no Default or Event of Default or Event of Loss or event, which
with the passage of time or if continued unremedied or unaltered would
constitute an Event of Loss, has occurred or exists;
(t) the Aircraft has been duly certificated by the FAA as to type and
airworthiness; there is in effect with respect to the Aircraft a current
and valid airworthiness certificate issued by the FAA pursuant to the
Transportation Code; and there is no fact known to the Lessee which
materially adversely affects the value, utility or condition of the
Aircraft;
(u) on the Refunding Date, the Lessee shall not be in material
default in the performance of any term or condition of the Engine Warranty
Assignment, the Modification Agreement and the GTA;
(v) neither the Lessee nor any subsidiary of the Lessee is an
"investment company" or a company "controlled by an investment company"
within the meaning of the Investment Company Act of 1940, as amended;
(w) the Aircraft is fully equipped to operate in commercial service
and will comply with all governmental requirements governing such service;
(x) there are no broker's or underwriter's or management fees
payable on behalf of the Lessee in connection with the transactions
contemplated in the Operative Agreements other than those of the
Underwriters and First Chicago Leasing Corporation referred to in Article
10 hereof and there are no other broker's fees payable in connection with
such transactions other than those of D'Accord Financial Services, Inc.;
(y) neither the Lessee nor any Affiliate of the Lessee has any
agreement, arrangement or understanding other than as set forth in,
permitted by or described in the Lessee Documents, the Underwriting
Agreement, or in the other Operative Agreements or in any agreement,
document or instrument contemplated thereby with any Person regarding the
transactions contemplated by the Operative Agreements; and
(z) the representations and warranties of the Lessee set forth in the
Original Agreements to which it is a party were correct on and as of the
Delivery Date (except to the extent such representations expressly related
solely to a specified earlier date, in which case such warranties and
representations were correct on and as of such earlier date).
Section 6.02. Offering by Lessee. The Lessee represents and
warrants that it has authorized no one to act on its behalf in connection with
the offer or sale of any interest in the Lessor's Estate or the Trust
Agreement other than First Chicago Leasing Corporation. Neither the Lessee
nor, based on representations of First Chicago Leasing Corporation, anyone
acting on its behalf has directly or indirectly offered any interest in the
Lessor's Estate or the Trust Agreement, or similar interests, for sale to, or
solicited any offer to acquire any of the same from, anyone other than the
Owner Participant and no more than 3 other institutional investors.
Section 6.03. Certain Covenants of Lessee. The Lessee covenants and
agrees with the Owner Participant, the Owner Trustee (in its individual
capacity and as Owner Trustee), the Pass Through Trustee (in its individual
capacity and as Pass Through Trustee) and the Indenture Trustee (in its
individual capacity and as Indenture Trustee) as follows:
(a) The Lessee will cause to be done, executed, acknowledged and
delivered at the Lessee's cost and expense all such further acts,
conveyances and assurances as the Owner Trustee, the Indenture Trustee, the
Pass Through Trustee or the Owner Participant shall reasonably require for
accomplishing the purposes of this Agreement, the Trust Agreement, the
Indenture, the Tax Indemnity Agreement, the Lease and the other Operative
Agreements to which it is a party. Without limiting the generality of this
Section 6.03(a), the Lessee will promptly take, or cause to be taken, at
the Lessee's cost and expense, such action with respect to the recording,
filing, re-recording and re-filing of the Indenture, each Indenture and
Security Agreement Supplement, the Lease, each Lease Supplement and any
financing statements or other instruments as may be necessary or requested
by the Indenture Trustee to maintain the perfection of the first security
interest and the Lien created by the Indenture, and the Owner Trustee's
title to and interest in the Aircraft and the Lessor's Estate as against
the Lessee and any third parties or if the Lessee cannot take, or cause to
be taken, such action, will furnish to the Indenture Trustee and the Owner
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 either of them to take such action at the Lessee's cost
and expense in a timely manner.
(b) The Lessee shall maintain the certificates referred to in Section
7.01 of the Lease and shall cause the Aircraft to remain duly registered,
in the name of the Owner Trustee, under the Transportation Code; provided,
however, that the Owner Participant, the Owner Trustee and the Indenture
Trustee agree that, so long as no Default or Event of Default shall have
occurred and be continuing, if, at any time after December 31, 2003, the
Lessee has requested their consent to the registration of the Aircraft in
the name of the Owner Trustee (or, if appropriate, in the name of the
Lessee or a sublessee as a "lessee" or a "sublessee"), at the Lessee's
expense, in a country listed in Schedule III hereto with which the United
States then maintains normal diplomatic relations, the Owner Participant,
upon receipt by the Owner Participant, the Owner Trustee and the Indenture
Trustee of the assurances and opinion described below, shall not
unreasonably withhold their consent to such change in registration (it
being agreed, without limitation, that the inability of the Lessee to
deliver such assurances and opinion shall constitute reasonable grounds to
withhold such consent).
As a condition to any change in the registration of the Aircraft, the
Owner Participant, the Owner Trustee in its individual and trust capacities,
and the Indenture Trustee shall have received, all at the Lessee's cost and
expense:
(i) assurances satisfactory to them:
(A) to the effect that the insurance provisions of the Lease
have been and will be complied with and are and shall be in full
force and effect upon such change of registry;
(B) that the Owner Trustee's right, title and interest in and
to the Aircraft is recognized and fully enforceable in the new
jurisdiction of registry and that the new jurisdiction of registry
will give effect to the title and registry of the Aircraft therein
substantially to the same extent as does the Government;
(C) that such new country of registry (x) would provide
substantially equivalent protection for the rights of owner
participants, lessors or lenders in similar transactions as provided
under United States law (except that, in the absence of restrictions
under the laws of such country on rights and remedies of lessors and
secured parties similar to those imposed by Sections 362 and 363 of
the Bankruptcy Code, rights and remedies similar to those available
under Section 1110 of the Bankruptcy Code shall not be required), and
(y)(i) if such change in registration is made other than in
connection with a sublease permitted under Section 7.02(a)(i) of the
Lease, imposes maintenance standards at least comparable to those of
the FAA, and (ii) if such change in registration is made in
connection with a sublease permitted under Section 7.02(a)(i) of the
Lease, imposes maintenance standards in conformity with those set
forth in Section 7.02(a)(i) of the Lease;
(D) that import and export certificates and any exchange
permits necessary to allow all Rent and other payments provided for
under the Lease, if required, shall have been procured at the
Lessee's own cost and expense by the Lessee;
(E) that duties and tariffs, if applicable, shall have been
paid for by the Lessee;
(F) to the effect that the original indemnities (and any
additional indemnities for which the Lessee is then willing to enter
into a binding agreement to indemnify) in favor of the Owner
Participant, the Owner Trustee (in its individual capacity and as
trustee under the Trust Agreement), the Indenture Trustee (in its
individual capacity, and as trustee under the Indenture), the Pass
Through Trustee (in its individual capacity, and as trustee under the
Pass Through Agreement) and the other Indemnitees under this
Agreement, the Indenture, the Pass Through Agreement and (in the case
of the Owner Participant only) the Tax Indemnity Agreement, afford
each such party substantially the same protection as provided prior
to such change of registry and if the sublessee, if any, is a
government or governmental body, such sublessee shall have
effectively waived any rights to sovereign immunity;
(G) that such change will not result in the imposition of, or
increase in the amount of, any Tax for which the Lessee is not
required to indemnify the Owner Participant, the Indenture Trustee,
the Owner Trustee (or any successor, assign or Affiliate thereof) and
the Trust Estate pursuant to Article 8 hereof or for which the Lessee
has not agreed to indemnify such parties in a manner satisfactory to
such parties;
(H) of the payment by the Lessee of any reasonable fees and
expenses of the Owner Participant, the Owner Trustee, the Indenture
Trustee and the Pass Through Trustee in connection with such change of
registry, including any reasonable attorneys' fees and expenses;
(I) that the Lessee shall maintain the registration of the
Aircraft under the laws of such country unless and until the
registration of the Aircraft is changed as provided herein, and shall
cause to be done at all times all other acts (including, if
applicable, the filing, recording and delivery of any document or
instrument and the payment of any sum) necessary or, by reference to
prudent industry practice in such country, advisable in order to
create, preserve and protect the interests of the Lessor and the
Indenture Trustee as against the Lessee or any third parties in such
jurisdiction;
(J) as to the continuation of the Lien of the Indenture as a
first priority, duly perfected Lien on the Aircraft and the Trust
Indenture Estate, that all recordings and filings required to so
perfect the Lien of the Indenture have been duly effected, and that
no Liens (except Liens permitted under Section 6.01 of the Lease)
shall arise by reason of such registration; and
(K) that appropriate deregistration powers of attorney in
favor of the Owner Trustee and the Indenture Trustee have been
executed and delivered by the Lessee and any sublessee and, if
necessary or desirable for the effectiveness thereof, filed with the
relevant aeronautics authority.
(ii)a favorable opinion of counsel (reasonably satisfactory to the
Owner Trustee, the Indenture Trustee and the Owner Participant) in the new
jurisdiction of registry, addressed and reasonably satisfactory to such
parties in scope, form and substance, to the effect:
(A) that the terms (including, without limitation, the
governing law, service-of-process and jurisdictional-submission
provisions thereof) of the Lease and the Indenture are legal, valid,
binding and enforceable in such jurisdiction against the Lessee, any
sublessee, the Owner Trustee and the Indenture Trustee, respectively;
(B) that it is not necessary for the Owner Participant, the
Owner Trustee, the Indenture Trustee or the Pass Through Trustee to
register or qualify to do business or meet other requirements not
already met in such jurisdiction in connection with the registration
in the new jurisdiction (and the filing and/or recordation therein of
the Indenture or Lease) and the exercise of any rights or remedies
with respect to the Aircraft pursuant to the Lease or the Indenture
or in order to maintain such registration and the Lien of the
Indenture;
(C) that the courts of such jurisdiction would provide
substantially equivalent protection to the Lessor, the Owner
Participant, the Pass Through Trustee and the Indenture Trustee as
provided under United States law (with the exception described in
paragraph (b)(i)(C)(x) of this Section 6.03) in respect of the
transactions contemplated hereby, including, without limitation, the
remedies provided in the Indenture and the Lease;
(D) that there is no tort liability of the beneficial owner,
record owner, lessor or mortgagee of an aircraft not in possession
thereof under the laws of such jurisdiction, other than such tort
liability which might have been imposed on such owner, lessor or
mortgagee under the laws of the United States or any state thereof
(it being understood that, in the event such latter opinion cannot be
given in a form satisfactory to the Owner Participant and the
Indenture Trustee, such opinion shall be waived, if insurance
reasonably satisfactory to the Owner Participant, the Indenture
Trustee and the Owner Trustee, in its individual capacity, is
provided, at the Lessee's expense, to cover such risk and the Lessee
undertakes to keep such insurance in full force and effect);
(E) that the laws of such jurisdiction (i) will not impair
the rights of the Lessor in and to the Aircraft and (ii) (unless the
Lessee shall have agreed to provide insurance reasonably satisfactory
to the Indenture Trustee and the Owner Participant covering the risk
of requisition of use of the Aircraft by the government of registry
of the Aircraft) require fair compensation by the government of such
jurisdiction payable in currency freely convertible into United
States dollars for the loss of use of the Aircraft in the event of
such requisition;
(F) that the Owner Trustee's title to the Aircraft is
recognized and fully enforceable in such jurisdiction, that such
jurisdiction will give effect to the title of the Aircraft therein
substantially to the same extent as does the Government, and that the
Lien of the Indenture shall continue as a first priority, duly
perfected lien on the Aircraft;
(G) as to the continuation of the Lien of the Indenture as a
first priority, duly perfected Lien on the Aircraft;
(H) that the rights of the Lessor in and to the Aircraft will
not be impaired in such new jurisdiction of registry; and
(I) to such further effect with respect to such other matters
as the Owner Participant, the Owner Trustee or the Indenture Trustee
may reasonably request.
(c) The Lessee shall promptly file any reports, or furnish to the
Owner Trustee and the Owner Participant such information as may be required
to enable the Owner Trustee and the Owner Participant timely to file any
reports required to be filed by the Owner Trustee as the Lessor and the
Owner Participant under the Lease with any governmental authority.
(d) The Lessee will cause the Special Aviation Counsel to file, and
where appropriate record, on the Refunding Date, the Lease, the Trust
Agreement and the Indenture. The following documents shall be filed and,
where appropriate, recorded on the Refunding Date with the Aeronautics
Authority in the following order of priority: first, the Trust Agreement,
second, the Indenture and third, the Lease with the Indenture attached
thereto.
(e) The Lessee will furnish to the Owner Participant, the Owner
Trustee and the Indenture Trustee annually after the execution of this
Agreement, by March 15 of each year, commencing with the year 1997, an
opinion, reasonably satisfactory to the Owner Participant and the Indenture
Trustee, of Special Aviation Counsel, or other counsel specified from time
to time by the Lessee acceptable to the Lessor and the Indenture Trustee:
(i) stating either (1) that in the opinion of such counsel such action has
been taken with respect to the recording, filing, re-recording and
re-filing of the Lease, the Indenture, the Trust Agreement, and any
supplements to any of them and any financing statements, continuation
statements or other instruments, and all other action has been taken, as is
necessary to maintain the Owner Trustee's title to and interest in the
Aircraft and the Lessor's Estate as against the Lessee and any third
parties and to maintain the perfection of the security interests created by
said documents and reciting the details of such action, or (2) that in the
opinion of such counsel no such action is necessary to maintain such title
or the perfection of such security interests; (ii) specifying all other
action which needs to be taken during the succeeding 14 months in order to
maintain such title and the perfection of such security interests (which
the Lessee agrees timely to take); and (iii) stating that the Owner Trustee
is the owner of legal title to the Aircraft, and the Aircraft is free and
clear of all Liens, except the security interest created by the Indenture
and such as are permitted by the Lease and the Indenture.
(f) The Lessee shall at all times maintain its corporate existence
except as permitted by Section 6.03(g) hereof and all of its rights,
privileges and franchises necessary in the normal conduct of its business,
except for any corporate right, privilege or franchise (i) that it
determines, in its business judgment, is no longer necessary or desirable
in the conduct of its business and (ii) the loss of which will not
materially adversely affect or diminish the rights of the Holders or the
Owner Participant or the ability of the Lessee to perform its obligations
under the Operative Agreements.
(g) The Lessee shall not enter into any merger or consolidation, or
convey, transfer or lease all or substantially all of its assets as an
entirety to any Person, unless the surviving corporation or Person which
acquires by conveyance, transfer or lease all or substantially all of the
assets of the Lessee as an entirety (i) is a domestic corporation organized
and existing under the laws of the United States or a political subdivision
thereof, (ii) is a Citizen of the United States, (iii) is a U.S. Air
Carrier, (iv) expressly assumes by an instrument in writing in form and
substance satisfactory to the Indenture Trustee, the Owner Trustee and the
Owner Participant all of the Lessee's obligations hereunder and under the
other Operative Agreements, and each other document contemplated hereby or
thereby and the Lessee delivers such instrument to the Indenture Trustee,
the Owner Participant and the Owner Trustee, (v) provides an opinion from
counsel to the Lessee which counsel shall be reasonably satisfactory to the
Owner Participant and the Indenture Trustee and which opinion shall be
reasonably satisfactory to the Owner Participant and the Indenture Trustee,
and an officer's certificate, each stating that such merger, consolidation,
conveyance, transfer or lease and the instrument noted in clause (iv) above
comply with this Section 6.03(g), that such instrument is a legal, valid
and binding obligation of, and is enforceable against, such survivor or
Person (except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws or equitable
principles of general application to or affecting the enforcement of
creditors' rights generally), and that all conditions precedent herein
provided for relating to such transaction have been complied with, and (vi)
immediately after such merger, consolidation or conveyance, transfer or
lease, as the case may be, the surviving company is in compliance with all
of the terms and conditions of this Agreement and the Lease and each other
Operative Agreement and each other document contemplated hereby or thereby;
provided that no such merger, consolidation or conveyance, transfer or
lease shall be permitted if the same gives rise to a Default not capable of
cure within the applicable grace period therefor or an Event of Default.
Upon any consolidation or merger, or any conveyance, transfer or
lease of all or substantially all of the assets of the Lessee and the
satisfaction of the conditions specified in this Section 6.03(g), the
successor corporation formed by such consolidation or into which the Lessee
is merged or the Person to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and
power of, the Lessee under this Agreement and the Lease and each other
Operative Agreement and any other document contemplated hereby and thereby
to which the Lessee is a party with the same effect as if such successor
corporation had been named as the Lessee herein and therein. No such
conveyance, transfer or lease of all or substantially all of the assets of
the Lessee as an entirety shall have the effect of releasing the Lessee or
any successor corporation which shall theretofore have become such in the
manner prescribed in this Section 6.03(g) from its liability hereunder or
under the other Operative Agreements. Nothing contained herein shall
permit any lease, sublease, or other arrangement for the use, operation or
possession of the Aircraft except in compliance with the applicable
provisions of the Lease.
(h) The Lessee agrees to give prompt written notice to the Owner
Participant, the Owner Trustee and the Indenture Trustee of any change in
the address of its chief executive office (as such term is used in Section
9-103(3) of the Tennessee Uniform Commercial Code) or of any change in its
corporate name.
(i) The Lessee agrees to furnish to the Owner Participant, the Lessor
and the Indenture Trustee:
(A) as soon as available, but in any event within one hundred
twenty (120) days after the end of each fiscal year of the Lessee, a
consolidated balance sheet as of the end of such fiscal year, and the
related consolidated statements of income, common stockholders'
equity, retained earnings and cash flows of the Lessee for the fiscal
year then ended as prepared and certified by the Lessee's independent
certified public accountants, including their opinion;
(B) within sixty (60) days after the end of the first, second
and third quarterly accounting periods in each fiscal year of the
Lessee, a consolidated balance sheet of the Lessee prepared by it as
of the close of the accounting period then ended, together with the
related consolidated statements of income, retained earnings and cash
flows for such accounting period certified by the chief accounting
officer or a financial vice president of the Lessee;
(C) promptly upon their general transmission, copies of all
regular and periodic reports furnished by the Lessee to its
stockholders;
(D) promptly after filing with the SEC, copies of the Lessee's
Annual Reports on Form 10-K (including all corresponding annual
reports to shareholders), Quarterly Reports on Form 10-Q and, if
requested, any registration statement or prospectus filed by the
Lessee with any securities exchange or with the SEC;
(E) promptly upon (and in any event within five (5) Business
Days after) any officer of the Lessee obtaining knowledge of any
condition or event which constitutes a Default or an Event of
Default, an officer's certificate specifying the nature and period of
existence thereof and what action the Lessee has taken or is taking
or proposes to take with respect thereto;
(F) promptly, notice of all legal or arbitral proceedings,
and of all proceedings by or before any governmental or regulatory
authority or agency, and of any material development in respect of
such legal or other proceedings affecting the Lessee, which in each
case specified above, if adversely determined, would, in the Lessee's
reasonable judgment, materially impair the ability of the Lessee to
perform its obligations under the Operative Agreements or consummate
the transactions contemplated hereby and thereby; and
(G) from time to time, such other financial information as the
Lessor, the Owner Participant or the Indenture Trustee may reasonably
request.
Concurrently with the delivery of the financial statements referred
to in clause (A) above, the Lessee shall deliver to the Lessor, the Owner
Participant, the Indenture Trustee and the Pass Through Trustee a certificate
of the Lessee, signed by any one of the President, the Chief Financial
Officer, the General Counsel, the Treasurer or the principal accounting
officer of the Lessee, stating that the signer, or an officer reporting to
same, is familiar with the relevant terms of this Agreement and the Lease and
the signer has reviewed, or has caused to be made under such Person's
supervision a review, of the activities of the Lessee and that, to the best of
his or her knowledge, there does not exist any Default or Event of Default or
if a Default or an Event of Default exists or did exist, specifying the nature
thereof, the period of existence thereof and what action the Lessee has taken
or proposes to take with respect thereto.
Section 6.04. Survival of Representations and Warranties. The
representations and warranties of the Lessee provided in Sections 6.01 and 6.02
hereof and in any other Operative Agreement shall survive the Closings
hereunder and the expiration or other termination of this Agreement and the
other Operative Agreements.
ARTICLE 7
OTHER PARTIES' REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Acquisitions and Offerings of Interests in Lessor's
Estate. (a) [Intentionally Left Blank.]
(b) Owner Participant. The Owner Participant represents and
warrants that its interest in the Lessor's Estate and the Trust Agreement was
acquired by it for its own account and not with a view to resale or
distribution thereof; provided, however, that the disposition by the Owner
Participant of its interest in the Lessor's Estate and the Trust Agreement
shall, subject to the terms and provisions of Article 5 of the Trust
Agreement, at all times be within its control and the foregoing representation
shall neither expand nor limit the Owner Participant's right to transfer or
sell such interests pursuant to the terms of this Agreement. The Owner
Participant further represents and warrants that neither the Owner Participant
nor anyone else authorized to act on its behalf has directly or indirectly
offered any interest in the Lessor's Estate or the Trust Agreement, or in any
similar security, for sale to, or solicited any offer to acquire any of the
same from, anyone. The Owner Participant further represents and warrants that
neither it nor anyone authorized to act on its behalf has made or will make any
offer, solicitation or sale of any interest in the Lessor's Estate or the
Trust Agreement in violation of the provisions of Section 5 of the Securities
Act of 1933, as amended. No representation in this Section 7.01(b) shall
include any action or inaction of the Lessee, the Agent, First Chicago Leasing
Corporation or the Underwriters whether or not purportedly on behalf of the
Owner Trustee, the Owner Participant or any of their Affiliates.
(c) Owner Trustee. The Owner Trustee represents and warrants, both
in its individual capacity and as trustee, that neither it nor anyone acting
on its behalf (i) has directly or indirectly offered or will directly or
indirectly offer any Certificates or any interest in the Lessor's Estate, or
in any similar security, for sale to, or solicited any offer to acquire any of
the same from anyone (other than the Owner Participant) and (ii) shall own
Certificates.
Section 7.02. Citizenship, Etc. (a) Generally. Each of the Owner
Trustee, in its individual capacity and as Trustee, and the Owner Participant
severally represents and warrants that it is a Citizen of the United States on
the Refunding Date. If the Owner Participant or the Owner Trustee in its
individual capacity does not comply with the requirements of this Section
7.02, the Owner Trustee, the Indenture Trustee and the Owner Participant
hereby agree that a Default or an Event of Default shall not be deemed to have
occurred and be continuing under the Lease due to non-compliance by the Lessee
with the registration requirements in the Lease occasioned by the
noncompliance of the Owner Participant or the Owner Trustee.
(b) Owner Trustee. The Owner Trustee, in its individual capacity,
covenants that if at any time it shall cease to be a Citizen of the United
States, it will resign immediately as the Owner Trustee if such citizenship is
necessary under the Transportation Code as in effect at such time or, if it is
not necessary under the Transportation Code as in effect at such time, if it
is informed in writing by the Lessee or the Owner Participant that such lack
of United States citizenship would have any adverse effect on the Lessee or
the Owner Participant. The Owner Trustee, in its individual capacity, further
covenants that if at any time it appears reasonably probable that it will
cease to be a Citizen of the United States based on information that is (i)
known to a Responsible Officer or (ii) generally known to the public, it will
promptly so notify, to the extent permitted by law, all parties to this
Agreement.
(c) Owner Participant. The Owner Participant agrees, solely for the
benefit of the Lessee, the Pass Through Trustee and the Indenture Trustee,
that if at any time when the Aircraft is registered or the Lessee proposes to
register the Aircraft in the United States (i) it shall fail to be a Citizen
of the United States and the Aircraft shall or would therefore become
ineligible for registration in the name of the Owner Trustee under the
Transportation Code and regulations then applicable thereunder, then the Owner
Participant shall give notice thereof to the Lessee and the Indenture Trustee
and shall (at its own expense and without any reimbursement or indemnification
from the Lessee) promptly but in any event within ten (10) Business Days (x)
effect a voting trust or other similar arrangement, (y) transfer in accordance
with the terms of this Agreement and the Trust Agreement all its rights, title
and interest in and to such Trust Agreement, the Lessor's Estate and this
Agreement, or (z) take any other alternative action that would prevent any
deregistration, or maintain or permit the United States registration, of the
Aircraft; or (ii) it determines that there is a reasonable likelihood that it
will in the future fail to qualify as a Citizen of the United States, and the
Aircraft would as a result thereof become ineligible for registration in the
name of the Owner Trustee under the Transportation Code, then the Owner
Participant shall give notice of such determination to the Lessee and the
Indenture Trustee and shall (at its own expense and without reimbursement or
indemnification from the Lessee and on such timetable as shall be reasonable
under the circumstances and consistent with its obligations under this Section
7.02(c)) prepare such documentation and establish such procedures as shall be
required to effect the voting trust, arrangements, transfer or other action
referred to in the preceding clause (i) in each case to be effective on the
date upon which the Owner Participant fails to qualify as a Citizen of the
United States (but in no event later than (10) Business Days after such date)
so as to prevent any deregistration of and to maintain or permit the
registration of, the Aircraft. It is agreed that the Owner Participant shall
be liable to pay promptly on request (A) to each of the other parties hereto
any damages actually incurred by any such other party as the result of the
representation and warranty of the Owner Participant in the first sentence of
Section 7.02(a) hereof proving to be untrue as of the Refunding Date; and (B)
to the Lessee, the Indenture Trustee or the Pass Through Trustee for any
damages actually incurred by the Lessee, the Indenture Trustee and the Pass
Through Trustee as a result of the Owner Participant's failure to comply with
its obligations pursuant to the first sentence of this Section 7.02(c);
provided, that, the foregoing shall not restrict the Pass Through Trustee or
the Indenture Trustee from asserting against the Owner Participant any damages
actually incurred by the holders of any Pass Through Certificates. Each other
party hereto agrees, upon the request and at the sole expense of the Owner
Participant, to cooperate with the Owner Participant in making any filings
required in order for the Owner Participant to comply with its obligations
under the provisions of the first sentence of this Section 7.02(c), but
without any obligation on the part of such other party to take any action
believed by it in good faith to be burdensome to such party or adverse to its
business interests.
Section 7.03. Representations, Warranties and Covenants of Owner
Participant. (a) Representations, Warranties and Covenants. In addition to
and without limiting its other representations and warranties provided for in
this Article 7, the Owner Participant represents and warrants that, on the
date hereof:
(i) it is a corporation duly incorporated and validly existing in
good standing under the laws of the State of Delaware and it has full
corporate power, authority and legal right to carry on its present business
and operations, to own or lease its Properties and to enter into and to
carry out the transactions contemplated by the Original Agreements to which
it is a party, this Agreement, the Tax Indemnity Agreement, and the Trust
Agreement;
(ii)the execution, delivery and performance by it of the Original
Agreements to which it is a party, this Agreement, the Tax Indemnity
Agreement, and the Trust Agreement have been duly authorized by all
necessary action on its part and, assuming the accuracy of the Lessee's
representations in Section 6.01(o) hereof, do not require any governmental
approvals that would be required to be obtained by the Owner Participant;
(iii)based on the representations, warranties and covenants contained
in Sections 6.01(m)(viii), 6.02 and 7.09 hereof and compliance with Section
10.06 of the Indenture, neither the execution, delivery or performance by
the Owner Participant of the Original Agreements to which it is a party,
this Agreement, the Tax Indemnity Agreement, and the Trust Agreement nor
compliance with the terms and provisions hereof or thereof, conflicts or
will conflict with or results or will result in a breach or violation of
any of the terms, conditions or provisions of, or will require any consent
or approval under any law, governmental rule or regulation applicable to
the Owner Participant, or the charter documents, as amended, or bylaws, as
amended, of the Owner Participant, or any order, writ, injunction or decree
of any court or governmental authority against the Owner Participant, or by
which it or any of its Properties is bound or any indenture, mortgage or
contract or other agreement or instrument to which the Owner Participant is
a party or by which it or any of its Properties is bound, or constitutes or
will constitute a default thereunder or results or will result in the
imposition of any Lien upon any of its Properties;
(iv)the Original Agreements to which it is a party, this Agreement,
the Tax Indemnity Agreement and the Trust Agreement have been or on the
Refunding Date will be duly executed and delivered by the Owner Participant
and constitute or on the Refunding Date will constitute the legal, valid
and binding obligation of the Owner Participant enforceable against it in
accordance with their terms except as such enforceability may be limited by
bankruptcy, insolvency, moratorium, reorganization or other similar laws or
equitable principles of general application to or affecting the enforcement
of creditors' rights (regardless of whether enforceability is considered in
a proceeding in equity or at law);
(v) it is not in default under any mortgage, deed of trust,
indenture, lease or other instrument or agreement to which the Owner
Participant is a party or by which it or any of its Properties may be
bound, or in violation of any applicable law, which default or violation
would have an adverse effect on the ability of the Owner Participant to
perform its obligations under the Original Agreements to which it is a
party, this Agreement and the other Operative Agreements to which it is or
is to be a party;
(vi)there are no pending or, to the knowledge of the Owner
Participant, threatened actions, suits, investigations or proceedings
against or affecting the Owner Participant or any of its Property before or
by any court or administrative agency which (A) involve the Aircraft or (B)
if adversely determined would adversely affect the ability of the Owner
Participant to perform its obligations under any of the Original Agreements
to which it is a party, this Agreement and the other Operative Agreements
to which it is or is to be a party;
(vii)neither the execution and delivery by it of the Original
Agreements to which it is a party, this Agreement or the other Operative
Agreements to which it is nor the performance of its obligations hereunder
or thereunder requires the consent or approval of or the giving of notice
to, the registration with, or the taking of any other action in respect of,
any governmental authority or agency that would be required to be obtained
or taken by the Owner Participant except for filings contemplated by this
Agreement;
(viii)no part of the funds to be used by it to acquire the interests
to be acquired by the Owner Participant under this Agreement constitutes
assets (within the meaning of ERISA and any applicable rules and
regulations) of any employee benefit plan subject to Title I of ERISA or of
any plan or individual retirement account subject to Section 4975 of the
Code;
(ix)it is a "U.S. Person" as defined in Section 7701(a)(30) of the
Code and if it shall at any time cease to be such a "U.S. Person", it shall
furnish to each Certificate Holder an indemnity, in form and substance
reasonably satisfactory to such Certificate Holder, for any Taxes that may
be imposed on such Holder as a result of the Owner Participant's failure to
be such a "U.S. Person"; and
(x) the representations and warranties of the Owner Participant set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier date).
Notwithstanding the foregoing or anything else contained in this
Agreement, the Owner Participant makes no representation or warranty in this
Agreement with respect to laws, rules or regulations relating to aviation or
to the nature or use of the equipment owned by the Owner Trustee, other than
such laws, rules or regulations relating to the citizenship requirements of
the Owner Participant under applicable aviation law and the other matters set
forth in Section 7.02(c) hereof.
(b) Lessor's Liens. The Owner Participant further represents,
warrants and covenants that there are no Lessor's Liens attributable to it or
any of its Affiliates against, on or with respect to the Aircraft or the
Lessor's Estate or the Trust Indenture Estate, and that there will not be any
Lessor's Lien attributable to it or any such Affiliate against, on or with
respect to the Aircraft or the Lessor's Estate or the Trust Indenture Estate
attributable to it or any such Affiliate on the Refunding Date. The Owner
Participant agrees with and for the benefit of the Lessee, the Indenture
Trustee, the Owner Trustee and the Pass Through Trustee that the Owner
Participant will, at its own cost and expense, take such action as may be
necessary (by bonding or other appropriate actions, so long as neither the
Lessee's operation and use of the Aircraft nor the validity and priority of
the Lien of the Indenture is impaired) to duly discharge and satisfy in full,
promptly and in any event within 30 days after the same first becomes known to
the Owner Participant, any Lessor's Lien against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate attributable to
the Owner Participant or any such Affiliate, provided, however, that the Owner
Participant shall not be required to discharge or satisfy such Lessor's Lien
which is being contested by the Owner Participant in good faith and by
appropriate proceedings so long as such proceedings do not involve any
material danger of the sale, forfeiture or loss of the Aircraft or the
Lessor's Estate or the Trust Indenture Estate or any interest in any thereof
or otherwise materially adversely affect the validity or priority of the Lien
of the Indenture.
(c) Indemnity for Lessor's Liens. The Owner Participant agrees to
indemnify and hold harmless the Lessee, the Indenture Trustee and the Pass
Through Trustee from and against any loss, cost, expense or damage which may
be suffered by the Lessee, the Indenture Trustee or the Pass Through Trustee
as the result of the failure of the Owner Participant to discharge and satisfy
any Lessor's Liens attributable to the Owner Participant or any of its
Affiliates and required to be discharged as described in Section 7.03(b)
hereof.
(d) Assignment of Interests of Owner Participant. The Owner
Participant agrees that it will not assign, convey or otherwise transfer any
of its right, title or interest in and to the Operative Agreements or the
Lessor's Estate except in accordance with the provisions of Article 5 of the
Trust Agreement, as in effect on the date hereof or as amended in accordance
with the terms of the Operative Agreements.
(e) Actions with Respect to Lessor's Estate, Etc. The Owner
Participant agrees that it will not take any action to subject the Lessor's
Estate or the trust established by the Trust Agreement, as debtor, to the
reorganization or liquidation provisions of the Bankruptcy Code or any other
applicable bankruptcy or insolvency statute.
Section 7.04. Representations, Covenants and Warranties of FSB and
the Owner Trustee. (a) In addition to and without limiting its other
representations and warranties provided for in this Article 7, FSB represents
and warrants, in its individual capacity with respect to items (i), (ii),
(iii)(A), (iv), (v), (vi) and (vii) below, and as the Owner Trustee with
respect to items (iii)(B) and (iv) that, on the date hereof:
(i)it is a national banking association duly organized and validly
existing in good standing under the laws of the United States of America
with its principal place of business and chief executive office (as such
terms are used in Article 9 of the Uniform Commercial Code) at ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇, Attention: Corporate Trust
Department and has full corporate power and authority, in its individual
capacity or (assuming the Trust Agreement has been duly authorized,
executed and delivered by the Owner Participant) as the Owner Trustee, as
the case may be, to carry on its business as now conducted, and to execute,
deliver and perform this Agreement, the Original Agreements to which it is
a party and the Operative Agreements to which it is or is to be a party;
(ii)the execution, delivery and performance by FSB, either in its
individual capacity or as the Owner Trustee, as the case may be, of this
Agreement, the Original Agreements and the Operative Agreements to which it
is or is to be party have been duly authorized by all necessary corporate
action on its part, and do not contravene its certificate of incorporation
or by-laws; each of this Agreement, the Original Agreements and the other
Operative Agreements to which it is or is to be a party has been duly
authorized, executed and delivered by FSB, either in its individual
capacity or as the Owner Trustee, as the case may be, and neither the
execution and delivery thereof nor FSB's performance of or compliance with
any of the terms and provisions thereof will violate any Federal or state
or local law or regulation governing FSB's banking or trust powers;
(iii)(A) assuming due authorization, execution and delivery by each
other party thereto, each of the Operative Agreements to which it is or is
to be party when duly executed and delivered will, and each of the Original
Agreements to which it is a party does, to the extent each such document is
entered into by FSB in its individual capacity, constitute the legal, valid
and binding obligation of FSB in its individual capacity enforceable
against it in such capacity in accordance with its respective terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and the performance by FSB in its individual capacity of
any of its obligations thereunder does not contravene any lease, regulation
or contractual restriction binding on FSB in its individual capacity;
(B) assuming due authorization, execution and delivery by each other
party thereto, each of the Operative Agreements to which it is or is to be
party when duly executed and delivered will, and each of the Original
Agreements to which it is a party does, to the extent each such document is
entered into by the Owner Trustee in its trust capacity, constitute the
legal, valid and binding obligation of the Owner Trustee enforceable
against it in such capacity in accordance with its respective terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and the performance by the Owner Trustee of any of its
obligations thereunder does not contravene any lease, regulation or
contractual restriction binding on the Owner Trustee;
(iv)there are no pending or, to its knowledge, threatened actions or
proceedings against FSB before any court or administrative agency which
would materially and adversely affect the ability of FSB, either in its
individual capacity or as the Owner Trustee, as the case may be, to perform
its obligations under the Operative Agreements to which it is or is to be
party;
(v) it shall give the Lessee, the Indenture Trustee and the Owner
Participant at least thirty (30) days' prior written notice in the event of
any change in its chief executive office or name;
(vi)neither the execution and delivery by it, either in its
individual capacity or as the Owner Trustee, as the case may be, of any of
the Original Agreements and the Operative Agreements to which it is or is
to be a party, requires on the part of FSB in its individual capacity or
any of its Affiliates the consent or approval of or the giving of notice
to, the registration with, or the taking of any other action in respect of,
any Federal or Utah governmental authority or agency governing its banking
or trust powers;
(vii)on the Refunding Date the Owner Trustee shall be holding
whatever title to the Aircraft as was conveyed to it by the Lessee on the
Delivery Date, the Aircraft shall be free of Lessor's Liens attributable to
FSB in its individual capacity and FSB in its individual capacity and as
Owner Trustee is a Citizen of the United States; and
(viii) the representations and warranties of the Owner Trustee set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier date).
(b) Lessor's Liens. FSB, in its individual capacity, further
represents, warrants and covenants that there are no Lessor's Liens
attributable to it in its individual capacity against, on or with respect to
the Aircraft or the Lessor's Estate or the Trust Indenture Estate, and that
there will not be any such Lessor's Liens against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate on the Refunding
Date. The Owner Trustee, in its trust capacity, and at the cost and expense of
the Lessee, covenants that it will in its trust capacity promptly, and in any
event within 30 days after the same shall first become known to it, take such
action as may be necessary to discharge duly any Lessor's Liens attributable
to it in its trust capacity. FSB, in its individual capacity, covenants and
agrees that it will at its own expense take such action as may be necessary to
duly discharge and satisfy in full, promptly, and in any event within 30 days
after the same shall first become known to it, any Lessor's Liens against, on
or with respect to the Aircraft or the Lessor's Estate or the Trust Indenture
Estate attributable to it in its individual capacity or the consolidated group
of taxpayers of which it (in such capacity) is a part which may arise at any
time after the date of this Agreement.
(c) Indemnity for Lessor's Liens. FSB, in its individual capacity,
agrees to indemnify and hold harmless the Lessee, the Indenture Trustee, the
Owner Participant and the Pass Through Trustee and the Owner Trustee from and
against any loss, cost, expense or damage which may be suffered by the Lessee,
the Indenture Trustee, the Owner Participant, the Pass Through Trustee or the
Owner Trustee as a result of the failure of FSB to discharge and satisfy any
Lessor's Liens attributable to it in its individual capacity, as described in
Section 7.04(b) hereof.
(d) Securities Act. None of FSB, the Owner Trustee or any Person
authorized by either of them to act on its behalf has directly or indirectly
offered or sold or will directly or indirectly offer or sell any interest in
the Lessor's Estate, or in any similar security relating to the Lessor's
Estate, or in any security the offering of which for purposes of the
Securities Act of 1933, as amended, would be deemed to be part of the same
offering as the offering of the aforementioned securities to, or solicited any
offer to acquire any of the same from, any Person.
Section 7.05. Representations, Warranties and Covenants of the
Indenture Trustee. (a) The Indenture Trustee in its individual capacity (other
than as the Pass Through Trustee) represents that, on the date hereof:
(i) it is a Massachusetts trust company duly organized and validly
existing in good standing under the laws of the Commonwealth of
Massachusetts and has the power and authority to enter into and perform its
obligations under the Indenture, this Agreement and the Original Agreements
to which it is a party and to authenticate the Certificates to be delivered
on the Refunding Date;
(ii)the Indenture and this Agreement, the Original Agreements to
which it is a party and the other Operative Agreements to which it is or is
to be a party, and the authentication of the Certificates to be delivered
on the Refunding Date, have been duly authorized by all necessary corporate
action on its part, and neither the execution and delivery thereof nor its
performance of any of the terms and provisions thereof will violate any
Federal or Massachusetts law or regulation relating to its banking or trust
powers or contravene or result in any breach of, or constitute any default
under, its articles of association or by-laws;
(iii)each of the Indenture and this Agreement, the Original
Agreements to which it is a party and the other Operative Agreements to
which it is or is to be a party, has been duly executed and delivered by it
and, assuming that each such agreement is the legal, valid and binding
obligation of each other party thereto, is the legal, valid and binding
obligation of the Indenture Trustee, enforceable against the Indenture
Trustee in accordance with its terms except as such enforceability may be
limited by bankruptcy, insolvency, reorganization or other similar laws or
equitable principles of general application to or affecting the enforcement
of creditors' rights (regardless of whether enforceability is considered in
a proceeding in equity or at law);
(iv)neither the execution and delivery by it of the Indenture and this
Agreement, the Original Agreements to which it is a party and the other
Operative Agreements to which it is or is to be a party, nor the
performance by it of any of the transactions contemplated hereby or
thereby, requires the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any
Federal or state governmental authority or agency governing its banking and
trust powers;
(v) the representations and warranties of the Indenture Trustee set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier
date); and
(vi)the Indenture Trustee holds the original counterparts of the
Original Lease, the Lease Supplement, Ancillary Agreement I and the
Warranty ▇▇▇▇ of Sale.
(b) Indenture Trustee's Liens. The Indenture Trustee, in its
individual capacity, further represents, warrants and covenants that there are
no Indenture Trustee's Liens attributable to it in its individual capacity
against, on or with respect to the Aircraft or the Lessor's Estate or the
Trust Indenture Estate, and that there will not be any Indenture Trustee's
Liens against, on or with respect to the Aircraft or the Lessor's Estate or
the Trust Indenture Estate on the Refunding Date. The Indenture Trustee, in
its individual capacity, covenants and agrees that it will at its own expense
take such action as may be necessary to duly discharge and satisfy in full,
promptly, and in any event within 30 days, after the same shall first become
known to it, any Indenture Trustee's Liens against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate.
(c) Indemnity for Indenture Trustee's Liens. The Indenture Trustee,
in its individual capacity, agrees to indemnify and hold harmless the Lessee,
the Owner Participant, the Owner Trustee and the Pass Through Trustee from and
against any loss, cost, expense or damage which may be suffered by the Lessee,
the Indenture Trustee, the Owner Participant, the Owner Trustee or the Pass
Through Trustee as a result of the failure of the Indenture Trustee to
discharge and satisfy any Indenture Trustee's Liens attributable to it in its
individual capacity, as described in Section 7.05(b) hereof.
Section 7.06. Indenture Trustee's Notice of Default. The Indenture
Trustee agrees to give the Owner Participant notice of any Payment Default
promptly upon a Responsible Officer of the Indenture Trustee having actual
knowledge thereof.
Section 7.07. Releases from Indenture. The Indenture Trustee
covenants and agrees, for the benefit of the Lessee and the Owner Participant,
to execute and deliver the instruments of release from the Lien of the
Indenture which it is required to execute and deliver in accordance with the
provisions of Article XIV of the Indenture, and the Owner Participant agrees,
for the benefit of the Lessee, to cause the Owner Trustee to request the
Indenture Trustee to execute and deliver such instruments of release.
Section 7.08. Covenant of Quiet Enjoyment. The Indenture Trustee,
the Pass Through Trustee and the Owner Trustee covenants and agrees as to
itself only that, so long as no Event of Default under the Lease has occurred
and is continuing, neither the Owner Trustee, the Indenture Trustee or the
Pass Through Trustee nor any Person lawfully claiming through the Owner
Trustee, the Indenture Trustee or the Pass Through Trustee shall interfere
with the Lessee's right to quietly enjoy the Aircraft during the Term without
hindrance or disturbance by the Owner Trustee, the Indenture Trustee or the
Pass Through Trustee, provided, however, that the Owner Trustee shall not be
liable for any act or omission of the Indenture Trustee or any other Person
claiming through the Indenture Trustee or the Pass Through Trustee.
Section 7.09. Original Loan Participants' and Pass Through Trustee's
Representations and Warranties. (a) Each Original Loan Participant
represents and warrants that the representations and warranties made by it in
Sections 7.01(a) and 7.06 of the Original Participation Agreement were correct
on and as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
representations and warranties were correct on and as of such earlier date).
(b) The Pass Through Trustee, in its individual capacity (except
with respect to clause (iii) below), represents and warrants as of the date
hereof (except as otherwise provided), as of the Pass Through Closing Date and
as of the Refunding Date that:
(i) it is a Massachusetts trust company duly organized and validly
existing in good standing under the laws of the Commonwealth of
Massachusetts and has the power and authority to enter into and perform its
obligations under the Pass Through Agreement, the Series Supplements and
this Agreement and to execute and authenticate the Pass Through
Certificates to be delivered on the Pass Through Closing Date;
(ii)the execution, delivery and performance of this Agreement, the
Pass Through Agreement and the Series Supplements and the performance of its
obligations hereunder and thereunder (including the execution and
authentication of the Pass Through Certificates to be delivered on the Pass
Through Closing Date) have been fully authorized by all necessary corporate
action on its part, and, subject to (A) the registration of the issuance
and sale of the Pass Through Certificates under the Securities Act, (B)
compliance with any applicable state securities laws and (C) the
qualification of the Pass Through Agreement under the Trust Indenture Act,
neither the execution and delivery thereof nor its performance of any of
the terms and provisions thereof will violate any Federal or Massachusetts
law or regulation relating to its banking or trust powers or contravene or
result in any breach of, or constitute any default under its articles of
association, or bylaws or the provisions of any indenture, mortgage,
contract or other agreement to which it is a party or by which it or its
properties may be bound or affected; and
(iii)each of this Agreement and the Pass Through Agreement has been,
and as of the Pass Through Closing Date the Series Supplements will be,
duly executed and delivered by it (in its individual and trust capacities)
and, assuming that each such agreement is the legal, valid and binding
obligation of each other party thereto, is or will be, as the case may be,
the legal, valid and binding obligation of the Pass Through Trustee (in its
individual and trust capacities), enforceable in accordance with its
respective terms except as limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights generally
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
Section 7.10. Survival of Representations, Warranties and Covenants.
The representations, warranties and covenants of the Owner Participant, the
Owner Trustee, the Pass Through Trustee and the Indenture Trustee provided for
in this Article 7, and their respective obligations under any and all of them,
shall survive the Closings and the expiration or other termination of this
Agreement, and the other Operative Agreements.
Section 7.11. Lessee's Assumption of the Certificates. (a) Subject
to compliance by the Lessee with all of its obligations under the Operative
Agreements, each of the Owner Participant, the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Lessee covenants and agrees that if
the Lessee elects to terminate the Lease and to purchase the Aircraft pursuant
to Section 4.02(a)(A), (D) or (E) of the Lease, and so long as no Default or
Event of Default shall have occurred and be continuing then, upon compliance
with the applicable provisions of said Section 4.02(a) of the Lease, the Owner
Trustee will transfer to the Lessee, without recourse or warranty (except as
to the absence of Lessor's Liens) but subject to the Lien of the Indenture,
all of the Owner Trustee's right, title and interest in and to the Aircraft,
and if the Lessee, in connection with such purchase, elects pursuant to
Section 4.02(a)(A), (D) or (E) of the Lease to assume the obligations of the
Owner Trustee to the Indenture Trustee and the Holders under the Indenture,
the Certificates and hereunder, then the Owner Trustee shall so notify the
Indenture Trustee (such notice to be given at least 30 and not more than 60
days prior to the effective date of such assumption), and each of the parties
shall execute and deliver appropriate documentation permitting the Lessee to
assume such obligations on the basis of full recourse to the Lessee,
maintaining for the benefit of the Holders the security interest in the
Aircraft created by the Indenture, and upon compliance with the provisions of
this Section 7.11, such documentation shall become effective and the Owner
Participant and the Owner Trustee shall be released from all obligations in
respect of the Certificates, the Indenture, this Agreement and all other
Operative Agreements, except any obligations which shall have arisen (or with
respect to events which shall have occurred) prior to such assumption, and
take all such other actions, at the Lessee's expense, as are reasonably
necessary to permit such assumption by the Lessee.
(b) In connection with such assumption:
(i) the Lessee shall execute and deliver an instrument satisfactory
in form and substance to the Indenture Trustee (A) pursuant to which the
Lessee irrevocably and unconditionally assumes and undertakes, with full
recourse to the Lessee, to pay, satisfy and discharge when and as due (at
the stated maturity thereof, by acceleration or otherwise) the principal
of, Make-Whole Premium, if any, interest and all other sums owing on all
Outstanding Certificates (or on the Lessee's substituted obligations) in
accordance with their terms and to punctually perform and observe all of
the covenants and obligations hereunder and under the Indenture and the
Certificates (as the same may be amended in connection with such
assumption) to be performed or observed by the Owner Trustee and (B) which
contains amendments to the Indenture, in form and substance satisfactory to
the Indenture Trustee and the Holders, that incorporate therein such
provisions from the Lease and this Agreement as may be appropriate,
including, without limitation, events of default substantially identical in
scope and effect to those set forth in the Lease and covenants
substantially identical to the covenants of the Lessee hereunder and under
the Lease;
(ii) the instrument referred to in paragraph (i) of this Section
7.11(b), any Uniform Commercial Code financing statements relating thereto,
and any other documents which shall be necessary (or reasonably requested
by the Indenture Trustee) to establish the Lessee's title to and interest
in the Aircraft or to reflect the substitution of the Lessee for the Owner
Trustee under the Operative Agreements or to continue the perfection of the
security interests in the Aircraft and the other rights, Property and
interests included in the Trust Indenture Estate for the benefit of the
Holders (or the Lessee's substituted obligations) shall be filed in such
form, manner and places as are necessary or, in the reasonable opinion of
the Indenture Trustee, advisable for such purpose;
(iii) the Indenture Trustee shall have received an insurance report
dated the effective date of such assumption of an independent insurance
broker and certificates of insurance, each in form and substance
satisfactory to the Indenture Trustee, as to the due compliance as of the
effective date of such assumption with the terms of Article 13 of the Lease
(as it relates to the Indenture Trustee) relating to the insurance with
respect to the Aircraft;
(iv) the Indenture Trustee shall have received evidence that as of
the effectiveness of the assignment on the date of such assumption the
Aircraft is free and clear of all Liens other than the Lien of the
Indenture and other Permitted Liens;
(v) the Indenture Trustee shall have received a certificate from the
Lessee that no Event of Default shall have occurred and be continuing as of
the effective date of such assumption; and
(vi) the Indenture Trustee shall have received (A) from counsel for
the Lessee (who may be the Lessee's General Counsel) a legal opinion, in
form and substance satisfactory to the Indenture Trustee (w) with respect
to the compliance of the assumption contemplated hereby with the terms,
provisions and conditions hereof, (x) with respect to the due
authorization, execution, delivery, validity and enforceability of the
instrument referred to in paragraph (i) of this Section 7.11(b), (y) with
respect to the continued perfection of the first and prior Lien and security
interest in the Aircraft for the benefit of the Holders of the Certificates
(or the Lessee's substituted obligations) referred to in paragraph (ii) of
this Section 7.11(b) and (z) with respect to the continued availability of
the benefits of Section 1110 of the Bankruptcy Code to the Indenture
Trustee for the benefit of the Holders with respect to the Aircraft after
giving effect to such assumption, (B) from counsel to the Indenture Trustee
and Special Aviation Counsel, a legal opinion comparable to the respective
opinions delivered on the Delivery Date with such changes therein as may be
appropriate in light of such assumption, and (C) in the case of each opinion
described in clause (A) or (B) above, covering such additional matters as
the Indenture Trustee shall reasonably request.
(c) The Lessee shall pay all reasonable expenses (including
reasonable fees and expenses of counsel) of the Indenture Trustee, the Owner
Trustee, the Pass Through Trustee and the Owner Participant in connection with
such assumption.
Section 7.12. Indebtedness of Owner Trustee. So long as the
Indenture is in effect, the Owner Trustee, not in its individual capacity, but
solely as trustee under the Trust Agreement, shall not incur any indebtedness
for borrowed money except as expressly contemplated herein or in any other
Operative Agreement (excluding the Tax Indemnity Agreement) and shall not
engage in any business or other activity other than the transactions
contemplated herein or in any other Operative Agreement (excluding the Tax
Indemnity Agreement) and all necessary or appropriate activity related thereto.
Section 7.13. Compliance with Trust Agreement, Etc. Each of the
Owner Participant, FSB and the Owner Trustee agrees with the Lessee, the
Indenture Trustee and the Pass Through Trustee that so long as the Lien of the
Indenture shall be in effect it will (i) comply with all of the terms of the
Trust Agreement applicable to it in its respective capacity, the noncompliance
with which would materially adversely affect any such party and (ii) not take
any action, or cause any action to be taken, to amend, modify or supplement
any other provision of the Trust Agreement in a manner that would adversely
affect such party without the prior written consent of such party. The Owner
Trustee confirms for the benefit of the Lessee, the Indenture Trustee and the
Pass Through Trustee that it will comply with the provisions of Article 2 of
the Trust Agreement. Notwithstanding anything else to the contrary in the
Trust Agreement, so long as the Lease or the Indenture remains in effect, the
Owner Participant agrees not to terminate or revoke the trust created by the
Trust Agreement without the consent of the Lessee (except in connection with
the exercise of remedies pursuant to Article 17 of the Lease) or, if the Lien
of the Indenture shall not have been discharged, the Indenture Trustee. The
Owner Trustee and the Owner Participant agree that no co-trustee or separate
trustee shall be appointed pursuant to Section 3.14 of the Trust Agreement if
such appointment would adversely affect the priority of the Lien of the
Indenture. The Indenture Trustee agrees that it shall not take any action
under this Section 7.13 except as instructed pursuant to Section 8.01 of the
Indenture.
ARTICLE 8
TAXES
Section 8.01. Lessee's Obligation to Pay Taxes. (a) Generally. The
Lessee agrees promptly to pay when due, and to indemnify and hold each
Indemnitee harmless from all license, recording, documentary, registration and
other fees and all taxes (including, without limitation, income, gross
receipts, sales, rental, use, value added, property (tangible and intangible),
ad valorem, excise and stamp taxes), fees, levies, imposts, recording duties,
charges, assessments or withholdings of any nature whatsoever, together with
any assessments, penalties, fines, additions to tax or interest thereon
(individually, a "Tax," and collectively called "Taxes"), however imposed
(whether imposed upon any Indemnitee, the Lessee, all or any part of the
Aircraft, Airframe, any Engine or any Part or the Lessor's Estate, the Trust
Indenture Estate, Rent, the Certificates or otherwise), by any Federal, state
or local government or taxing authority in the United States, or by any
government or taxing authority of a foreign country or of any political
subdivision or taxing authority thereof or by a territory or possession of the
United States or an international taxing authority, upon or with respect to,
based upon or measured by:
(i) the Aircraft, the Airframe, any Engine or any Part;
(ii) the location, replacement, control, purchase, improvement,
maintenance, manufacture, acquisition, financing, refinancing, mortgaging,
ownership, delivery, nondelivery, acceptance, rejection, leasing,
subleasing, transport, insuring, inspection, registration, reregistration,
assembly, abandonment, repossession, redelivery, installment, preparation,
possession, use, operation, return, presence, storage, repair, transfer of
title, modification, rebuilding, export, import, alteration, replacement,
substitution, assignment, overhaul, transfer of registration or title,
imposition of any Lien, sale or other disposition of the Aircraft,
Airframe, any Engine or any Part thereof or interest therein;
(iii) the rentals (including Basic Rent and Supplemental Rent),
receipts or earnings arising from the Operative Agreements or Original
Agreements;
(iv) the Property attributable to the transactions contemplated by
the Operative Agreements or the Original Agreements, or the income or other
proceeds received with respect to such Property, held by the Owner Trustee
under the Trust Agreement or by the Indenture Trustee under the Indenture;
(v) the Operative Agreements or the Original Agreements or otherwise
with respect to or by reason of the transactions described in or
contemplated by the Operative Agreements or the Original Agreements;
(vi) the payment of the principal or interest or other amounts
payable with respect to the Original Loan Certificates, the Pass Through
Certificates or the Certificates or the right thereto as it accrues;
(vii) the Original Loan Certificates, the Pass Through Certificates
or the Certificates or the issuance, sale, acquisition, reamortization or
refinancing thereof or the beneficial interests in the Trust Estate or the
Trust Indenture Estate or the creation thereof under the Trust Agreement or
the Indenture, or the security interest created or perfected thereby or by
any filing thereof; or
(viii) any assumption by the Lessee pursuant to Section 7.11 of this
Agreement and Section 2.12 of the Indenture.
(b) Exceptions. The indemnity provided for in Section 8.01(a) shall
not extend to any of the following:
(i) With respect to an Indemnitee other than an Original Loan
Participant, Taxes based upon, measured by or with respect to the net or
gross income, items of tax preference or minimum tax or excess profits,
receipts, capital, franchise, net worth or conduct of business or other
similarly-based Taxes of such Indemnitee (other than any Taxes in the
nature of sales, use, transfer, excise, rental, license, ad valorem,
property or other similarly based Taxes) (the "Income Taxes"); provided,
however that the provisions of this paragraph (b)(i) shall not exclude from
the indemnity described in Section 8.01(a) hereof, any Income Taxes to the
extent such Income Taxes are imposed by any jurisdiction in which the
Indemnitee would not be subject to such Income Taxes but for, or would be
subject to such Income Taxes solely as a result of, (x) the operation,
registration, location, presence, or use of the Aircraft, Airframe, any
Engine or any Part thereof, in such jurisdiction or (y) the place of
incorporation or principal office or the activities of the Lessee or any
sublessee in such jurisdiction (it being understood that (A) any such
indemnity would be payable only to the extent of the net harm incurred by
the Indemnitee from such Income Taxes, taking into account any incremental
current Tax benefit in another tax jurisdiction resulting from payment of
such Income Taxes and (B) this sentence would require indemnification in a
jurisdiction in which the Indemnitee is already subject to an Income Tax
(an "Existing Income Tax") only if an event set forth in Clause (x) or (y)
of this sentence causes the Indemnitee to be subject to an Income Tax in
that jurisdiction (a "New Income Tax") other than an Existing Income Tax,
and such New Income Tax would have been imposed even if the activities
contemplated by the Operative Agreements or the Original Agreements were the
Indemnitee's sole nexus to the jurisdiction); provided, further, that the
provisions of this paragraph (b)(i) relating to Income Taxes shall not
exclude from the indemnity described in Section 8.01(a) hereof any Income
Taxes for which the Lessee would be required to indemnify an Indemnitee (x)
so that any payment under the Operative Agreements or the Original
Agreements, otherwise required to be made on an After-Tax Basis, is made on
an After-Tax Basis or (y) pursuant to the last sentence of Section 8.02,
8.05, 9.02 or 9.05 of this Agreement;
(ii)With respect to an Original Loan Participant, Income Taxes (other
than in the case of a Non-U.S. Person, U.S. federal withholding taxes on
amounts payable with respect to such Original Loan Participant's Loan
Certificate) except to the extent such Income Tax is imposed (including by
way of increase) by any jurisdiction in which the Indemnitee is subject to
tax (A) as a result of the operation, registration, location, presence,
basing or use of the Aircraft, Airframe, any Engine or any Part thereof, in
such jurisdiction (it being understood that (I) the incremental Income
Taxes described in this clause (A) shall not include any U.S. Federal
income taxes and (II) that to the extent such incremental Income Taxes give
rise to any incremental current Tax benefit in another tax jurisdiction,
that such incremental benefit shall offset and decrease the incremental
Income Taxes determined under this clause (A)) or (B) solely as a result of
the place of incorporation, principal office, corporate domicile or the
activities of the Lessor, Owner Participant, the Owner Trustee, the
Indenture Trustee, the Lessee or any sublessee in such jurisdiction (it
being understood that to the extent that any Income Taxes described under
this clause (B) give rise to any incremental current Tax benefit in another
tax jurisdiction or another tax period, that such incremental Tax benefit
shall offset and decrease the Income Taxes determined under this clause
(B)); provided, however, that the provisions of this paragraph (b)(ii)
relating to Income Taxes shall not exclude from the indemnity described in
Section 8.01(a) any Income Taxes for which the Lessee would be required to
indemnify an Indemnitee (x) so that any payment under the Operative
Agreements, otherwise required to be made on an After-Tax Basis, is made on
an After-Tax Basis or (y) pursuant to the last sentence of Section 8.02 of
this Agreement;
(iii)Taxes arising out of or measured by acts, omissions, events or
periods of time (or any combination of the foregoing) which occur after
(and are not attributable to acts, omissions or events occurring, or fines,
penalties or interest resulting from any such act, omission or event having
occurred, contemporaneously with or prior to) the payment in full of all
amounts payable by the Lessee pursuant to and in accordance with the
Operative Agreements, or the earlier discharge in full of the Lessee's
payment obligations under and in accordance with the Lease and the
Operative Agreements (and the Original Loan Certificates in the case of an
Original Loan Participant, the Indenture Trustee or the Trust Indenture
Estate if the Lessee shall have assumed the Certificates pursuant to
Section 7.11 of this Agreement or Section 2.12 of the Indenture), and the
earliest of (x) the expiration of the Term of the Lease and return of the
Aircraft in accordance with Article 12 of the Lease, (y) the termination of
the Lease in accordance with the applicable provisions of the Lease and
return of the Aircraft in accordance with the Lease, or (z) the termination
of the Lease in accordance with the applicable provisions of the Lease and
the transfer of all right, title and interest in the Aircraft to the Lessee
pursuant to its exercise of any of its purchase options set forth in
Section 4.02(a) of the Lease, except that, notwithstanding anything in this
Section 8.01(b) to the contrary, Taxes incurred in connection with the
exercise of any remedies pursuant to Article 17 of the Lease following the
occurrence of an Event of Default and while it is continuing shall not be
excluded from the indemnity described in Section 8.01(a);
(iv)As to the Owner Trustee, Taxes imposed against the Owner Trustee
upon or with respect to any fees for services rendered in its capacity as
Owner Trustee under the Original Trust Agreement or the Trust Agreement or,
as to the Indenture Trustee, Taxes imposed against the Indenture Trustee
upon or with respect to any fees received by it for services rendered in
its capacity as Indenture Trustee under the Original Indenture or the
Indenture;
(v) Taxes imposed on an Indemnitee that would not have been imposed
but for the willful misconduct or gross negligence of such Indemnitee
(other than gross negligence or willful misconduct not actually committed
by but instead imputed to such Indemnitee by reason of such Indemnitee's
participation in the transactions contemplated by the Operative Agreements
or the Original Agreements) or the breach by such Indemnitee of any
representation, warranty or covenant contained in the Operative Agreements
or the Original Agreements or any document delivered in connection
therewith (unless attributable to a breach of representation, warranty or
covenant of the Lessee), provided that in the case of a breach by the Owner
Participant or the Owner Trustee of any representation, warranty or
covenant, timely written notice requesting compliance was received by the
Owner Participant or the Owner Trustee as the case may be;
(vi) Taxes imposed on any Indemnitee or any successor, assign or
Affiliate thereof which became payable by reason of any voluntary or
involuntary transfer or disposition by such Indemnitee subsequent to the
Delivery Date, including revocation by such Indemnitee of the trust created
by the Trust Agreement, of any interest in some or all of the Aircraft,
Airframe, Engines or Parts thereof, of any interest in a Loan Certificate,
or its interest in the Lessor's Estate, other than (A) Taxes that result
from transfers or dispositions which occur while an Event of Default under
the Lease has occurred and is continuing at the time of such transfer or
disposition, (B) transfers pursuant to the Lessor's exercise of remedies
under the Lease, (C) with respect to a Loan Participant, any actual or
deemed transfer pursuant to Section 7.11 hereof or Section 2.13 or 2.18 of
the Indenture or as a consequence of a refinancing under Article 15 hereof,
or any actual or deemed transfer of a Loan Certificate that as part of a
refinancing under Article 15 hereof is not retired, but only to the extent
the Taxes attributable to such transfer exceed the amount of indemnifiable
Taxes that would have been imposed on such transferor if the debt had
instead been retired, or (D) Taxes (other than Income Taxes) that result
from any transfer or disposition pursuant to Section 4.02 (other than
clauses B or C thereof) or Article 7, 8, 9, 10, 11, or 13 of the Lease;
(vii)Taxes imposed on the Owner Participant for which the Lessee is
obligated to indemnify the Owner Participant pursuant to the Tax Indemnity
Agreement;
(viii)Notwithstanding anything herein to the contrary, Taxes imposed
on a successor, assign or other transferee (including, without limitation,
a transferee which is a new lending office of an original Indemnitee) of
any Person which on the Delivery Date is an Indemnitee (for purposes of
this clause (viii), an "original Indemnitee") to the extent that such Taxes
exceed the amount of Taxes that would have been imposed (in the case of an
Original Loan Participant, immediately after giving effect to such
succession, assignment or other transfer) and would have been indemnifiable
pursuant to Section 8.01(a) had there not been a succession, assignment or
other transfer by such original Indemnitee of any such interest of such
Indemnitee in the Aircraft or any part thereof, any interest in or under any
Operative Agreement, or any proceeds thereunder, the trust created by the
Original Trust Agreement, the Original Loan Certificates or otherwise;
provided, however, that the exclusion provided by this clause (viii) shall
not apply in the case of a succession, transfer or disposition (A) while an
Event of Default under the Lease has occurred and is continuing at the time
of such transfer, (B) which is an actual or deemed transfer pursuant to
Section 7.11 hereof or Section 2.13 or 2.18 of the Indenture or as a
consequence of a Refinancing under Section 15.01 hereof, or any actual or
deemed transfer of an Original Loan Certificate that as part of a
Refinancing under Section 15.01 hereof is not retired, but only to the
extent the Taxes attributable to such transfer exceed the amount of Taxes
that would have been imposed on such transferor if the debt had instead
been retired, (C) to the extent necessary to make payments with respect to
such Taxes on an After-Tax Basis, (D) in the case of the Lessor or Owner
Participant, to any Tax other than an Income Tax or (E) to the extent such
Taxes are directly attributable to the failure of the Lessee to take
administrative actions as have been reasonably requested of it in writing
in a timely manner and which will result in no after-tax cost or expense to
the Lessee;
(ix)[Intentionally Left Blank];
(x) Any Taxes which have been included in the Purchase Price;
(xi) Any Taxes which would not have been imposed on the Owner
Participant but for a Lessor's Lien attributable to the Owner Participant;
and
(xii) Taxes imposed on the Owner Participant or any person who is a
"disqualified person", within the meaning of Section 4975(e)(2) of the
Code, or a "party in interest", within the meaning of Section 3(14) of
ERISA, by virtue of such person's relationship to the Owner Participant as
the result of any prohibited transaction, within the meaning of Section 406
of ERISA and Section 4975(c)(1) of the Code, occurring with respect to the
purchase or holding of any Loan Certificate (A) in connection with which
purchase or holding the Owner Participant or any Affiliate thereof is
acting as the investment manager, advisor or discretionary trustee and is
making or directing such purchase or holding (other than in the capacity of
a custodian, directed trustee or other similar nondiscretionary capacity),
or (B) by an employee benefit plan, within the meaning of Section 3(3) of
ERISA, or a plan subject to Section 4975 of the Code with respect to which
the Owner Participant (or any Affiliate thereof) is the "plan sponsor"
within the meaning of Section 3(16)(B) of ERISA, provided, however, that in
the event of a Refinancing of the Certificates described in Section
15.01(d)(viii) hereof, the exception under this clause (xii) shall not be
applicable.
(c) Withholding. The Pass Through Trustee shall withhold any Taxes
required to be withheld on payments to any holder of a Pass Through
Certificate who is a Non-U.S. Person except to the extent that such a holder
of a Pass Through Certificate has furnished evidence to the Pass Through
Trustee sufficient under applicable law to entitle such holder of a Pass
Through Certificate to any exemption from withholding on interest claimed by
such holder of a Pass Through Certificate. The Indenture Trustee shall
withhold any Taxes required to be withheld on any payment to a Holder pursuant
to Section 5.09 of the Indenture. If the Indenture Trustee or the Pass
Through Trustee fails to withhold a Tax required to be withheld with respect
to any Holder of a Certificate or any holder of a Pass Through Certificate or
any claim is otherwise asserted by a taxing authority against the Owner
Trustee or Owner Participant for or on account of any amount required to be
withheld from a payment in respect of a Certificate, the Lessee will indemnify
(after taking into account any payments made by a Holder to or for the benefit
of the Owner Participant or the Owner Trustee pursuant to the preceding
sentence) the Owner Trustee and the Owner Participant (without regard to the
exclusions set forth in Section 8.01(b) hereof) on an After-Tax Basis against
any Taxes required to be withheld and any interest, penalties and additions to
tax with respect thereto, along with any other costs (including attorneys'
fees) incurred in connection with any such claim. The Indenture Trustee or
the Pass Through Trustee, as the case may be, in its individual capacity (and
without recourse to the Trust Indenture Estate), shall indemnify the Lessee on
an After-Tax Basis for any payment the Lessee shall have made pursuant to the
preceding sentence.
Section 8.02. After-Tax Basis. The amount which the Lessee shall be
required to pay with respect to any Tax indemnified against under Section 8.01
shall be an amount sufficient to restore the Indemnitee, on an After-Tax
Basis, to the same position such party would have been in had such Tax not
been incurred. If any Indemnitee actually realizes a Tax benefit by reason of
the payment of any Tax paid or indemnified against by the Lessee, such
Indemnitee shall promptly pay to the Lessee to the extent such Tax benefit was
not previously taken into account in computing such payment an amount equal to
the lesser of (x) the sum of such Tax benefit plus any other Tax benefit
actually realized by such Indemnitee that would not have been realized but for
any payment made by such Indemnitee pursuant to this sentence and not already
paid to the Lessee, and (y) the amount of the payment required to be made
under Sections 8.01 and 8.02 by the Lessee to such Indemnitee plus the amount
of any other payments by the Lessee to such Indemnitee theretofore required to
be made under Sections 8.01 and 8.02 (and the excess, if any, of the amount
described in clause (x) above over the amount described in clause (y) above
shall be carried forward and applied to reduce pro tanto any subsequent
obligations of the Lessee to make payments pursuant to Sections 8.01 and
8.02); provided, however, that notwithstanding the foregoing portions of this
sentence, such Indemnitee shall not be obligated to make any payment to the
Lessee pursuant to this sentence as long as a Payment Default, Bankruptcy
Default or an Event of Default shall have occurred and be continuing under the
Lease. The Lessee shall reimburse on an After-Tax Basis such Indemnitee for
any payment of a Tax benefit pursuant to the preceding sentence (or a Tax
benefit otherwise taken into account in calculating the Lessee's indemnity
obligation hereunder) to the extent that such Tax benefit is disallowed or
reduced subsequent to such payment (including the expiration of any tax credit
carryovers or carrybacks of such Indemnitee that would not otherwise have
expired).
Section 8.03. Time of Payment. Any amount payable to an Indemnitee
pursuant to this Article 8 shall be paid within 30 days after receipt of a
written demand therefor from such Indemnitee accompanied by a written
statement describing in reasonable detail the basis for such indemnity and the
computation of the amount so payable, provided that in the case of amounts
which are being contested by the Lessee in good faith or by the Indemnitee in
either case pursuant to Section 8.04 hereof, such amount shall be payable 30
days after the time such contest is finally resolved.
Section 8.04. Contests. If a written claim is made against any
Indemnitee for Taxes with respect to which the Lessee may be liable for a
payment or indemnity hereunder, such Indemnitee shall promptly give the Lessee
notice in writing of such claim and shall furnish the Lessee with copies of
any requests for information from any taxing authority relating to such Taxes
with respect to which the Lessee may be required to indemnify hereunder;
provided, however, that the failure of an Indemnitee to give such notice or
furnish such copy shall not terminate any of the rights of such Indemnitee
under this Article 8, except to the extent that the Lessee's contest rights
have been materially and adversely impaired by the failure to provide such
notice. The Indemnitee shall in good faith, with due diligence and at the
Lessee's expense, if timely requested in writing by the Lessee, contest (or,
at the Indemnitee's option, require the Lessee to contest in the name of the
Lessee, if permitted by law) the validity, applicability or amount of such
Taxes by:
(i) resisting payment thereof if lawful and practicable or not
paying the same except under protest if protest is necessary and proper in
each case so long as non-payment will not result in a material risk of the
sale, forfeiture or loss of, or the creation of a Lien not permitted under
Section 6.01 of the Lease on the Aircraft, Airframe or any Engine or any
risk of criminal liability; or
(ii)if the payment be made, using reasonable efforts to obtain a
refund thereof in appropriate administrative and judicial proceedings.
If the Indemnitee, after reasonable discussion with the Lessee and
consideration in good faith of any suggestion made by the Lessee as to the
method of pursuing such contest, elects to conduct the contest, such
Indemnitee shall determine the manner in which to contest such Taxes;
provided, however, that if the Indemnitee determines in its sole discretion
that such participation will not adversely affect such Indemnitee's contest of
any Taxes not indemnified hereunder, the Lessee shall have the right to
participate in such contest, including, among other rights, the right to attend
governmental or judicial conferences (to the extent unrelated issues are not
discussed) concerning such claim and the right to review and approve all
submissions to any governmental or other authority insofar as they relate to
the Tax for which indemnification is sought. Notwithstanding the preceding
sentences of this Section 8.04, such Indemnitee shall not be required to take
or continue any action unless the Lessee shall have (i) agreed in writing to
pay and shall pay the Indemnitee on demand and on an After-Tax Basis for any
liability or expense which such Indemnitee may incur as a result of contesting
such Taxes including without limitation (y) attorneys' and accountants' fees
and (z) the amount of any interest, penalty or additions to tax which may
ultimately be payable as the result of contesting such Taxes, (ii) delivered
to the Indemnitee a written acknowledgment of the Lessee's obligation to such
Indemnitee pursuant to this Agreement to the extent that the contest is not
successful and of the inapplicability of any exclusion or defenses thereto,
provided, however, that such acknowledgement shall not preclude the Lessee
from raising defenses to liability under this Agreement if a decision in such
contest is rendered which clearly articulates the cause of such Tax and the
cause, as so articulated, is not one for which the Lessee is responsible to
pay an indemnity hereunder, (iii) made all payments and indemnities (other
than contested payments and indemnities) then due to the Indemnitee hereunder
or with respect to any of the transactions contemplated by or under the
Operative Agreements. In no event shall such Indemnitee be required or the
Lessee permitted to contest pursuant to this Section 8.04 the imposition of
any Tax for which the Lessee is obligated to indemnify any Indemnitee
hereunder unless (i) such Indemnitee shall have received an opinion of
independent tax counsel, at the Lessee's expense, selected by such Indemnitee
and reasonably satisfactory to the Lessee ("Tax Counsel") to the effect that a
reasonable basis exists for contesting such claim, (ii) if an Event of Default
shall have occurred and be continuing, the Lessee shall have provided security
for its obligations hereunder reasonably satisfactory to the Indemnitee, (iii)
if such contest shall be conducted in a manner requiring payment of the claim
in advance, the Lessee shall have advanced sufficient funds, on an interest
free basis to make the payment required, and agreed to indemnify the
Indemnitee against any additional net adverse tax consequences on an After-Tax
Basis to such Indemnitee of such advance, (iv) such Indemnitee shall have
determined that such contest will not result in any material risk of loss,
sale or forfeiture of, or the creation of any Lien not permitted under Section
6.01 of the Lease on, the Aircraft or any part thereof or interest therein or
in a risk of criminal liability and (v) the issue shall not be the same as an
issue previously contested hereunder and decided adversely, unless the
Indemnitee shall have received, at the Lessee's sole expense, a written
opinion, in form and substance reasonably satisfactory to such Indemnitee, of
Tax Counsel, to the effect that the applicable law has changed and, in light
thereof, there is substantial authority within the meaning of Section 6662 of
the Code (if applicable), as interpreted by the Treasury regulations
thereunder, or under similar principles of state or foreign law (as the case
may be) for contesting such claim and (v) the amount of such claim (without
taking into account any amount necessary to indemnify on an After-Tax Basis),
when aggregated with related and correlative claims, is at least $50,000.
The Indemnitee shall not be required to appeal any judicial decision
unless it receives an opinion of Tax Counsel to the effect that it is more
likely than not that such appeal will be successful.
Nothing contained in this Section 8.04 shall require any Indemnitee to
contest or continue to contest, or permit Lessee to contest, a claim which such
Indemnitee would otherwise be required to contest pursuant to this Section
8.04, if such Indemnitee shall waive payment by Lessee of any amount that
might otherwise be payable by Lessee under this Article 8 in connection with
such claim.
Section 8.05. Refunds. Upon receipt by an Indemnitee of a refund of
all or any part of any Taxes which the Lessee shall have paid for such
Indemnitee or for which the Lessee shall have reimbursed or indemnified such
Indemnitee, and provided there shall not have occurred and be continuing any
Bankruptcy Default, Payment Default or Event of Default by the Lessee
hereunder or under the Lease (in which case payment shall not be made to the
Lessee until such Event of Default shall have been cured), such Indemnitee
shall pay to the Lessee an amount equal to the amount of such refund less
Taxes imposed with respect to the accrual or receipt thereof, including
interest received attributable thereto, plus any Tax benefit actually realized
by such Indemnitee as a result of any payment by such Indemnitee made pursuant
to this sentence; provided, however, that such amount shall not be payable (a)
before such time as the Lessee shall have made all payments or indemnities
then due and payable to such Indemnitee under this Article 8 and (b) to the
extent that the amount of such payment would exceed (i) the amount of all
prior payments by the Lessee to such Indemnitee pursuant to this Article 8
less (ii) the amount of all prior payments by such Indemnitee to the Lessee
pursuant to this Article 8, with any such excess to be carried forward and
applied to reduce any future obligation of the Lessee under this Article 8.
Any subsequent loss of such refund or Tax benefit shall be treated as
a Tax subject to indemnification under the provisions of this Article 8
(without regard to Section 8.01(b) (i), (iii) or (viii) hereof).
Section 8.06. Lessee's Reports. In case any report or return is
required to be made with respect to any Tax for which Lessee is obligated to
indemnify under this Article 8, the Lessee shall make such report or return,
except for any such report or return that the Indemnitee has notified the
Lessee that it intends to file, in such manner as will show the ownership of
the Aircraft in the Owner Trustee and shall send a copy of the applicable
portions of such report or return to the Indemnitee and the Owner Trustee or
will notify the Indemnitee of such requirement and make such report or return
in such manner as shall be satisfactory to such Indemnitee and the Owner
Trustee. The Lessee will provide such information reasonably available to the
Lessee as the Indemnitee may reasonably require from the Lessee to enable the
Indemnitee to fulfill its tax filing requirements with respect to the
transactions contemplated by the Operative Agreements (without duplication of
the requirements of Section 3 of Tax Indemnity Agreement) and any audit
information request arising from any such filing. The Indemnitee will provide
such information (other than copies of any of its tax returns) as the Lessee
may reasonably require from such Indemnitee to enable the Lessee to fulfill
its tax filing requirements with respect to the transactions contemplated by
the Operative Agreements and any audit information request arising from such
filing. The Lessee shall hold the Indemnitee harmless from and against any
liabilities, including penalties, additions to tax, fines and interest,
imposed upon such Indemnitee to the extent directly attributable to any
insufficiency or inaccuracy in any return, statement, or report prepared by
the Lessee or information supplied by the Lessee, or directly attributable to
the Lessee's failure to supply reasonably available information to such
Indemnitee as required by this Section 8.06.
Section 8.07. Survival of Obligations. The representations,
warranties, indemnities and agreements of the Lessee provided for in this
Article 8 and the Lessee's obligations under any and all of them shall survive
the expiration or other termination of the Operative Agreements.
Section 8.08. Payment of Taxes. With respect to any Tax otherwise
indemnifiable hereunder by the Lessee and applicable to the Aircraft,
Airframe, any Engine or Parts, to the extent permitted by the applicable
state, local or foreign law, the Lessee shall pay such Tax directly to the
relevant Taxing authority and file any returns or reports required with
respect thereto and if such direct payment is not permitted or feasible under
the circumstances, pay an amount equal to such Tax to the Indemnitee at least
2 Business Days prior to the time such Indemnitee pays such Tax; provided,
however, that the Lessee shall not make any statements or take any action
which would indicate that the Lessee or any Person other than the Owner Trust
or the Owner Participant is the owner of the Aircraft, the Airframe, any
Engine or any Part or would otherwise be inconsistent with the terms of the
Lease (including the Purchase Price being equal to the fair market value of
the Aircraft on the Delivery Date) and the position thereunder of the Owner
Trustee and the Owner Participant. Copies of such returns or reports,
together with evidence of payment of any tax due, shall be sent by the Lessee
to the Owner Participant within thirty (30) days after the date of each
payment by the Lessee of any Tax.
Section 8.09. Reimbursements by Indemnitees Generally. If, for any
reason, the Lessee is required to make any payment with respect to any Taxes
imposed on any Indemnitee in respect of the transactions contemplated by the
Operative Agreements or on the Aircraft, the Airframe, the Engines, the Parts
of any part thereof, which Taxes are not the responsibility of the Lessee with
respect to such Indemnitee, then such Indemnitee shall pay to the Lessee
within 30 days of the Lessee's demand therefor an amount which equals the
amount actually paid by the Lessee with respect to such Taxes.
ARTICLE 9
GENERAL INDEMNITY
Section 9.01. Generally. (a) The Lessee agrees to indemnify each
Indemnitee against and agrees to protect, defend, save and keep harmless each
Indemnitee from any and all liabilities, obligations, losses, damages
(including if, as a result of an Indenture Event of Default described in
Section 7.01(a)(i) of the Indenture, the Indenture Trustee shall have sold all
or any portion of the Indenture Estate and the proceeds thereof were less than
an amount equal to accrued and unpaid Basic Rent on the date of sale plus the
Stipulated Loss Value as of such date, damages equal to such shortfall
together with interest thereon to the extent permitted by law at the Debt Rate
until such shortfall is paid in full), penalties, claims, actions, suits,
costs, disbursements and expenses (including legal fees and expenses and all
costs and expenses relating to amendments, supplements, adjustments, consents,
refinancings and waivers under the Operative Agreements and the Original
Agreements except as otherwise provided in Section 10.01(d)(i) or Article 15
hereof) of every kind and nature (whether or not any of the transactions
contemplated by this Agreement are consummated) (individually, an "Expense,"
collectively, "Expenses"), which may be imposed on, incurred or suffered by or
asserted against any Indemnitee, in any way relating to, based on or arising
out of:
(i) the Original Agreements, this Agreement, the Lease, the
Indenture, the Trust Agreement, the Pass Through Agreement, the Bills of
Sale or any other Operative Agreement or any amendment to any Operative
Agreement or any other document entered into in connection herewith or any
sublease or transfer or any transactions contemplated hereby or thereby;
(ii)the operation, possession, ownership, use, non-use, maintenance,
storage, delivery, non-delivery, control, testing, overhaul or repair of
the Aircraft, Airframe, or any Engine or any engine used in connection with
the Airframe, or any part thereof by the Lessee, any sublessee or any other
Person whatsoever, whether or not such operation, possession, ownership,
use, non-use, maintenance, storage, delivery, non-delivery, control,
testing, overhaul or repair is in compliance with the terms of the Lease,
including without limitation, claims for death, personal injury or property
damage or other loss or harm to any Person whatsoever and claims relating
to any laws, rules or regulations;
(iii)the manufacture, design, purchase, condition, repair,
modification, airworthiness, return, lease, sale, acceptance, rejection,
servicing, rebuilding, registration, alteration, merchantability,
substitution, replacement, fitness for use, transfer or sublease of any
Airframe, Engine, or Part under the Lease, the GTA or the Engine Warranty
Assignment or other transfer of use or possession, or other disposition of
the Aircraft, the Airframe, any Engine or any Part, latent or other defects
whether or not discoverable, strict tort liability, and any claims for
patent, trademark or copyright infringement;
(iv)any breach of or failure to perform or observe, or any other
non-compliance with, any condition, covenant or agreement to be performed,
or other obligations of the Lessee under any of the Operative Agreements or
the Original Agreements, or the falsity or inaccuracy of any representation
or warranty of the Lessee in any of the Operative Agreements or the
Original Agreements (other than representations and warranties in the Tax
Indemnity Agreement);
(v) the enforcement of the terms of the Operative Agreements or the
Original Agreements and the administration of the Trust Indenture Estate;
and
(vi)the offer, issuance, sale or delivery of any Certificate or any
Pass Through Certificate or any Original Loan Certificate, or any refunding
or refinancing thereof, or interest in the Lessor's Estate or the Trust
Agreement or the Original Trust Agreement or any similar interest or in any
way relating to or arising out of the Trust Agreement or the Original Trust
Agreement and the Lessor's Estate, the Indenture or the Original Indenture
or the Trust Indenture Estate (including, without limitation, any claim
arising out of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, or any other federal or state statute,
law or regulation, or at common law or otherwise relating to securities), or
the action or inaction of the Owner Trustee or Indenture Trustee as
trustees, in the manner contemplated by this Agreement, the Original
Participation Agreement, the Indenture, the Original Indenture, the
Indenture and Security Agreement Supplement, the Trust Agreement or the
Original Trust Agreement and in the case of the Owner Participant, its
obligations arising under Section 6.01 of the Trust Agreement or the
Original Trust Agreement.
The foregoing indemnity by the Lessee is intended to include and cover, but is
not limited to, any Expense to which the Indemnitees may be subject as a
result of their respective ownership or leasing of any interest in or holding
of any Lien on the Aircraft, Airframe, any Engine or Part during the Term,
whether or not in the Lessee's possession or control, insofar as such Expense
relates to any activity or event whatsoever involving such item while it is
under lease to the Lessee (or after termination of the Lease in connection
with the exercise of remedies thereunder to the extent that such Expense is
attributable to the transactions contemplated hereby or by the other Operative
Agreements and the Original Agreements), and such Expense does not fall within
any of the exceptions listed in Section 9.01(b) hereof.
(b) Exceptions. The indemnity provided for in Section 9.01(a) shall
not extend to any Expense of any Indemnitee:
(i) to the extent attributable to the willful misconduct or gross
negligence of such Indemnitee;
(ii)in respect of the Aircraft to the extent attributable to acts or
events which occur after the Aircraft is no longer part of the Lessor's
Estate or leased under the Lease or, if the Aircraft remains a part of the
Lessor's Estate, after the expiration of the Term (other than pursuant to
Article 17 of the Lease, in which case the indemnity provided in Section
9.01(a) hereof shall survive for so long as Lessor shall be entitled to
exercise remedies under such Article 17), or to acts or events which occur
after return of possession of the Aircraft by the Lessee in accordance with
the provisions of the Lease but in any such case only to the extent not
fairly attributable to acts or omissions of the Lessee prior to expiration
of the Term, including without limitation the Lessee's failure to fully
discharge all of its obligations under the Lease, the other Operative
Agreements or the Original Agreements;
(iii)which is a Tax, whether or not the Lessee is required to
indemnify therefor pursuant to Article 8 hereof or pursuant to the Tax
Indemnity Agreement;
(iv)which is a cost or expense expressly required to be paid by the
Owner Participant or its permitted transferees (and not by the Lessee)
pursuant to this Agreement or any other Operative Agreement;
(v) to the extent that such Expenses would not have been incurred by
such Indemnitee if such Indemnitee had not been in breach of its
representations or warranties, or had not defaulted in the observance and
performance of the terms and provisions required to be observed and
performed by it, in this Agreement, the Engine Warranty Assignment, the
Lease, the Indenture, the Trust Agreement, the Original Agreements or any
other Operative Agreement to which it is a party unless such breach or
default shall be a result of the breach or default of any of the foregoing
by the Lessee or another Indemnitee;
(vi)[Intentionally Left Blank];
(vii)in the case of the Owner Participant, Lessor's Liens to the
extent attributable to the Owner Participant; in the case of FSB, Lessor's
Liens to the extent attributable to FSB; and in the case of the Indenture
Trustee, Indenture Trustee's Liens;
(viii)in the case of the Owner Participant or the Owner Trustee, to
the extent attributable to the offer or sale by such Indemnitee after the
Delivery Date of any interest in the Aircraft, the Lessor's Estate or the
Trust Agreement or any similar interest (including an offer or sale
resulting from bankruptcy or other proceedings for the relief of debtors in
which such Indemnitee is the debtor), unless in each case such offer or
sale shall occur (w) in connection with a Refinancing, (x) during a period
when an Event of Default has occurred and is continuing, (y) during a
period when an Event of Loss has occurred or (z) in connection with the
termination of the Lease or action or direction of the Lessee pursuant to
Section 4.02 of the Lease or Article 10 of the Lease; or
(ix)in the case of the Owner Participant or any person who is a
"disqualified person", within the meaning of Section 4975(e)(2) of the
Code, or a "party in interest", within the meaning of Section 3(14) of
ERISA, by virtue of such person's relationship to the Owner Participant, as
the result of any prohibited transaction, within the meaning of Section 406
of ERISA or Section 4975(c)(1) of the Code, occurring with respect to the
purchase or holding of any Loan Certificate (or any funded participation
therein) (i) over which purchase or holding the Owner Participant or any
Affiliate thereof (other than in the capacity of a directed trustee or
custodian or similar nondiscretionary capacity) has discretion or control,
or (ii) by an employee benefit plan, within the meaning of Section 3(3) of
ERISA, or individual retirement account or plan subject to Section 4975 of
the Code with respect to which the Owner Participant (or any Affiliate
thereof) is a "plan sponsor", within the meaning of Section 3(16)(B) of
ERISA.
Section 9.02. After-Tax Basis. The amount which the Lessee shall be
required to pay with respect to any Expense indemnified against under Section
9.01 shall be an amount sufficient to restore the Indemnitee, on an After-Tax
Basis, to the same position such party would have been in had such Expense not
been incurred. If any Indemnitee actually realizes a permanent Tax benefit by
reason of the payment of such Expense paid or indemnified against by the
Lessee which was not considered in the computation thereof, such Indemnitee
shall promptly pay to the Lessee, but not before the Lessee shall have made
all payments theretofore due such Indemnitee under this Agreement, the
Original Agreements, the Tax Indemnity Agreement and any other Operative
Agreement, an amount equal to the lesser of (x) the sum of such Tax benefit
plus any other permanent Tax benefit actually realized by such Indemnitee as
the result of any payment made by such Indemnitee pursuant to this sentence
and (y) the amount of such payment pursuant to this Section 9.02 by the Lessee
to such Indemnitee plus the amount of any other payments by the Lessee to such
Indemnitee theretofore made pursuant to this Section 9.02 less the amount of
any payments by such Indemnitee to the Lessee theretofore made pursuant to
this Section 9.02 (and the excess, if any, of the amount described in clause
(x) above over the amount described in clause (y) above shall be carried
forward and applied to reduce pro tanto any subsequent obligations of the
Lessee to make payments to such Indemnitee pursuant to this Section 9.02), it
being intended that no Indemnitee should realize a net Tax benefit pursuant to
this Section 9.02 unless the Lessee shall first have been made whole for any
payments by it to such Indemnitee pursuant to this Section 9.02; provided,
however, that notwithstanding the foregoing portions of this sentence, such
Indemnitee shall not be obligated to make any payment to the Lessee pursuant
to this sentence so long as any Payment Default, Bankruptcy Default or Event
of Default shall have occurred and be continuing. Any Taxes that are imposed
on any Indemnitee as a result of the disallowance or reduction of such Tax
benefit referred to in the next preceding sentence in a taxable year
subsequent to the year of allowance and utilization by such Indemnitee
(including the expiration of any tax credit carryovers or carrybacks of such
Indemnitee that would not otherwise have expired) shall be indemnifiable
pursuant to the provisions of Section 8.01 hereof (without regard to Section
8.01(b)(i), (iii) or (viii) hereof).
Section 9.03. Subrogation. Upon the payment in full of any indemnity
pursuant to this Article 9 by the Lessee (but not earlier), the Lessee shall be
subrogated to any right of the Indemnitee, other than with respect to any of
such Indemnitee's insurance policies or in connection with any indemnity claim
the Person indemnified may have against any other Indemnitee in respect of the
matter against which such indemnity has been made.
Section 9.04. Notice and Payment. Each Indemnitee and the Lessee
shall give prompt written notice one to the other of any liability of which
such party has knowledge for which the Lessee is, or may be, liable under this
Article 9; provided, however, that failure to give such notice shall not
terminate any of the rights of the Indemnitees under this Article 9, except
(with respect to such Indemnitee) to the extent that the Lessee has been
materially prejudiced by the failure to provide such notice. Unless otherwise
provided in the Operative Agreements, any amount payable to an Indemnitee
pursuant to this Article 9 shall be paid within 30 days after receipt of a
written demand therefor from such Indemnitee accompanied by a written statement
describing in reasonable detail the basis for such indemnity and the
computation of the amount so payable.
Section 9.05. Refunds. If any Indemnitee shall obtain a recovery of
all or any part of any amount which the Lessee shall have paid to such
Indemnitee or for which the Lessee shall have reimbursed such Indemnitee under
this Article 9, and provided there shall not have occurred a Payment Default,
Bankruptcy Default or an Event of Default (in which case payment shall not be
made to the Lessee until such Payment Default, Bankruptcy Default or Event of
Default shall have been cured) such Indemnitee shall pay to the Lessee, within
ten (10) Business Days of receipt thereof by such Indemnitee, the amount of
any such recovery, including interest received with respect to the recovery,
net of any Taxes paid or payable as a result of the receipt of the recovery
and interest, plus any net additional permanent income Tax benefits actually
realized by Indemnitee as the result of any payment made pursuant to this
sentence less any reasonable costs and expense of any Indemnitee not
reimbursed by the Lessee; provided, however, that such amount shall not be
payable (a) before such time as the Lessee shall have made all payments or
indemnities then due and payable to such Indemnitee under this Article 9 or
(b) to the extent that the amount of such payment would exceed the amount of
all prior payments by the Lessee to such Indemnitee pursuant to this Article
9, less the amount of all prior payments by such Indemnitee to the Lessee
pursuant to this Article 9. Any subsequent loss of such recovery or Tax
benefit shall be subject to indemnification under Article 8 or this Article 9,
as the case may be.
Section 9.06. Defense of Claims. The Lessee or its insurers shall
have the right (in each such case at the Lessee's sole expense) to investigate
or, provided that (i) the Lessee or its insurers shall not reserve the right
to dispute liability with respect to any insurance policies pursuant to which
coverage is sought, (ii) in the case of the Lessee, no Event of Default shall
have occurred and be continuing and (iii) the Lessee shall have first
acknowledged in writing to such Indemnitee the Lessee's obligation to
indemnify such Indemnitee hereunder in respect of such claim, defend any claim
covered by insurance for which indemnification is sought pursuant to this
Article 9 and each Indemnitee shall cooperate with the Lessee or its insurers
with respect thereto, and provided, further, the Lessee shall not be entitled
to assume and control the defense of any such claim if and to the extent such
Indemnitee reasonably objects to such control on the ground that an actual or
potential material conflict of interest exists where it is advisable for such
Indemnitee to be represented by separate counsel. Subject to the immediately
foregoing sentence, where the Lessee or the insurers under a policy of
insurance maintained by the Lessee undertake the defense of an Indemnitee with
respect to such a claim, no additional legal fees or expenses of such
Indemnitee in connection with the defense of such claim shall be indemnified
hereunder unless the fees or expenses were incurred at the written request of
the Lessee or such insurers. Subject to the requirement of any policy of
insurance applicable to a claim, an Indemnitee may participate at its own
expense at any judicial proceeding controlled by the Lessee or its insurers
pursuant to the preceding provisions, provided that such party's participation
does not, in the opinion of the independent counsel appointed by the Lessee or
its insurers to conduct such proceedings, interfere with such control; and
such participation shall not constitute a waiver of the indemnification
provided in this Section 9.06. No Indemnitee shall enter into any settlement
or other compromise with respect to any claim described in this Section 9.06
without the prior written consent of the Lessee, which consent shall not
unreasonably be withheld or delayed, unless such Indemnitee waives its right
to be indemnified under this Article 9 with respect to such claim. The Lessee
shall not enter into any settlement or compromise which admits any criminal
violation, gross negligence or willful misconduct on the part of any Indemnitee
without the prior written consent of such Indemnitee.
Section 9.07. Survival of Obligations. The representations,
warranties, indemnities and agreements of the Lessee provided for in this
Article 9 and the Lessee's obligations under any and all of them shall survive
the expiration or other termination of this Agreement, the Tax Indemnity
Agreement, the Trust Agreement, the Indenture, the Engine Warranty Assignment,
the Lease and the other Operative Agreements but, as to such indemnities, only
with respect to losses, liabilities, obligations, damages, penalties, claims,
actions, suits, costs, Expenses and disbursements caused by events occurring
or existing prior to or incurred in the process of (i) the return or
disposition of the Aircraft under Article 12 or Article 17 of the Lease, or
(ii) the termination of the Lease or the Indenture or, if later, the return of
the Aircraft.
Section 9.08. Effect of Other Indemnities. The Lessee's obligations
under the indemnities provided for in this Agreement shall be those of a
primary obligor whether or not the Person indemnified shall also be
indemnified with respect to the same matter under the terms of this Agreement,
the Lease, the Indenture, the Trust Agreement, or any other document or
instrument, and the Person seeking indemnification from the Lessee pursuant to
any provision of this Agreement may proceed directly against the Lessee
without first seeking to enforce any other right of indemnification.
Section 9.09. Interest. The Lessee will pay to each Indemnitee on
demand, to the extent permitted by applicable law, interest on any amount of
indemnity not paid when due pursuant to this Article 9 until the same shall be
paid, at the Past Due Rate and an Indemnitee who obtains a recovery under
Section 9.05 hereof that is required to be paid to the Lessee shall pay to the
Lessee on demand, interest on any amount not paid to the Lessee when due
pursuant to such Section 9.05, until the same shall be paid, at the Past Due
Rate.
ARTICLE 10
TRANSACTION COSTS
Section 10.01. Transaction Costs and Other Costs. (a) Transaction
Costs. The Owner Participant shall pay (or reimburse the Lessee if the Lessee
shall have previously made such payment), in addition to those items set forth
in Section 10.01(a) of the Original Participation Agreement (other than clause
(v) thereof) all fees and expenses of the following persons relating to the
public offering of the Pass Through Certificates contemplated by the
Underwriting Agreement and related to the transactions contemplated hereby:
(i) the fees and expenses of counsel for the Owner Participant; (ii) the fees
and expenses of the transaction documentation counsel and counsel for the
Owner Trustee, the Indenture Trustee, the Pass Through Trustee, the Original
Loan Participants and the Underwriters (other than those fees, expenses and
disbursements payable by the Underwriters pursuant to the Underwriting
Agreement); (iii) the fees and expenses of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇; (iv)
any initial fees and expenses of the Pass Through Trustee and the fees and
expenses of the Owner Trustee and the Indenture Trustee; (v) any compensation,
commissions and discounts payable to the Underwriters pursuant to the
Underwriting Agreement; (vi) the fees, if any, incurred in printing the Pass
Through Certificates; (vii) the fees and expenses incurred in connection with
printing any amendment to the Registration Statement on Form S-3 bearing
Registration No. 333-07691, printing any Preliminary Prospectus or Prospectus
(as such terms are defined in the Underwriting Agreement) for the offering of
the Pass Through Certificates; (viii) the fees and expenses of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP; (ix) the fees and expenses of ▇▇▇▇▇'▇ and S&P; and (x) the fees and
expenses of First Chicago Leasing Corporation. The fees and expenses
described in clauses (ii) through (x) of this paragraph shall be allocable to
the Owner Participant under this Agreement (1) to the extent incurred
specifically with respect to the Owner Participant or the refunding of the
Original Loan Certificates, and (2) to the extent such fees and expenses are
incurred but are not specifically attributable to the Owner Participant or the
refunding of the Original Loan Certificates, in the proportion that the
principal amount of the Certificates bears to the total amount of the Pass
Through Certificates.
The Owner Participant, the Owner Trustee and the Lessee acknowledge
that the percentages for Basic Rent, EBO Price, Stipulated Loss Value and
Termination Value set forth in the Lease have been prepared assuming the
aggregate amount payable by the Owner Participant pursuant to the preceding
paragraph and Section 10.01 of the Original Participation Agreement is 1.46%
of the Purchase Price (the "Estimated Expense Amount"); provided, however,
that in no event shall the sum of (i) the Owner Participant's Commitment (as
such term is defined in the Original Participation Agreement), (ii) the
Transaction Costs to be paid by the Owner Participant pursuant to Section 2.03
of the Original Participation Agreement and (iii) the Transaction Costs to be
paid by the Owner Participant pursuant to Section 10.01 hereof, exceed
$22,700,000.00. To the extent that the payment by the Owner Participant of
Transaction Costs would cause the sum described in the immediately preceding
sentence to exceed $22,700,000.00, the Lessee shall be obligated to pay the
Transaction Costs constituting the First Chicago Leasing Corporation fee and
the ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ fee to the extent of such excess and the Owner
Participant shall have no obligation to pay such excess.
(b) Continuing Expenses. The continuing fees, expenses and
disbursements (including reasonable counsel fees and expenses) of the entity
acting as Owner Trustee, as lessor under the Lease and as Owner Trustee under
the Trust Agreement with respect to the administration of the Lease and the
Lessor's Estate and the continuing fees, expenses and disbursements (including
reasonable counsel fees and expenses and initial fees relating to the
establishment of any replacement trustee) of the Indenture Trustee, as trustee
under the Indenture with respect to the administration of the Trust Indenture
Estate and the continuing fees, expenses and disbursements (including
reasonable counsel fees and initial fees relating to the establishment of a
replacement trustee) of the Pass Through Trustee shall be paid as Supplemental
Rent by the Lessee, including without limitation any amounts payable to the
Indenture Trustee or on account of requests by the Indenture Trustee for
indemnification under Article XI of the Indenture.
(c) Amendments, Supplements and Appraisal. Without limitation of the
foregoing, the Lessee agrees:
(i) to pay as Supplemental Rent to the Owner Trustee, the Owner
Participant, the Indenture Trustee and the Pass Through Trustee all costs
and expenses (including reasonable legal fees and expenses) incurred by any
of them in connection with (a) any Default or Event of Default and any
enforcement or collection proceedings resulting therefrom or (b) the
negotiation of any restructuring or "work-out" (whether or not
consummated), or the obligations of the Lessee hereunder or under the other
Operative Agreements and the enforcement of this Section 10.01, including,
without limitation, the entering into or giving or withholding of any
amendments or supplements or waivers or consents (whether or not
consummated), including without limitation, any amendment, waiver,
modification or consent resulting from any work-out, restructuring or
similar proceeding relating to the performance or nonperformance by the
Lessee of its obligations under the Operative Agreements or (c) any
amendment, supplement, waiver or consent (whether or not entered into)
under the Original Agreements, this Agreement, the Lease, the Indenture,
the Certificates, the Tax Indemnity Agreement, the Engine Warranty
Assignment or any other Operative Agreement or document or instrument
delivered pursuant to any of them, which amendment, supplement, waiver or
consent is required by any provision of any Operative Agreement or is
requested by the Lessee or necessitated by the action or inaction of the
Lessee; provided, however, that the Lessee shall not be responsible for fees
and expenses of the other parties hereto incurred in connection with the
offer, sale or other transfer (whether pursuant to Article 5 of the Trust
Agreement or otherwise) by the Owner Participant or the Owner Trustee after
the Refunding Date of any interest in the Aircraft, the Lessor's Estate,
the Beneficial Interest, the Trust Agreement or any similar interest (and
the Owner Participant shall be responsible for all such fees and expenses),
unless such offer, sale or transfer shall occur (A) during a period when an
Event of Default has occurred and is continuing under the Lease, (B) during
a period following an Event of Loss or (C) in connection with the
termination of the Lease or action or direction of the Lessee pursuant to
Section 4.02 or Article 10 of the Lease; and
(ii)to pay the fees, costs and expenses of all appraisers involved in
an independent appraisal of the Aircraft to the extent required under
Section 4.03 of the Lease.
ARTICLE 11
SUCCESSOR OWNER TRUSTEE
Section 11.01. Appointment of Successor Owner Trustee. (a)
Resignation and Removal. The Owner Trustee or any successor Owner Trustee may
resign or may be removed by the Owner Participant, and a successor Owner
Trustee may be appointed under the Trust Agreement only in accordance with the
provisions of Section 3.11 of the Trust Agreement and the provisions of
paragraphs (b) and (c) of this Section 11.01.
(b) Conditions to Appointment. The appointment in any manner of a
successor Owner Trustee pursuant to Section 3.11 of the Trust Agreement shall
be subject to the following conditions:
(i) Such successor Owner Trustee shall be a Citizen of the United
States;
(ii)Such successor Owner Trustee shall be a bank or a trust company
having combined capital, surplus and undivided profits of at least
$100,000,000 or a bank or trust company fully guaranteed by a direct or
indirect parent thereof having a combined capital, surplus and undivided
profits of at least $100,000,000;
(iii)Such appointment shall not violate any provisions of the
Transportation Code or any applicable rule or regulation of the applicable
regulatory agency or body of any other jurisdiction in which the Aircraft
may then be registered or create a relationship which would be in violation
of the Transportation Code or any applicable rule or regulation of the
applicable regulatory agency or body of any other jurisdiction in which the
Aircraft may then be registered;
(iv)Such successor Owner Trustee shall enter into an agreement or
agreements, in form and substance satisfactory to the Lessee, the Owner
Participant, the Pass Through Trustee and the Indenture Trustee whereby such
successor Owner Trustee confirms that it shall be deemed a party to this
Agreement, the Trust Agreement, the Lease, the Lease Supplement, the Engine
Warranty Assignment, the Indenture, the Indenture Supplement and any other
Operative Agreement to which the Owner Trustee is a party and agrees to be
bound by all the terms of such documents applicable to the Owner Trustee and
makes the representations and warranties contained in Section 7.04 hereof
(except that it may be duly incorporated, validly existing and in good
standing under the laws of the United States of America or any State
thereof); and
(v) All filings of Uniform Commercial Code financing and continuation
statements, filings in accordance with the Transportation Code and
amendments thereto shall be made and all further actions taken in
connection with such appointment as may be necessary in connection with
maintaining the validity, perfection and priority of the Lien of the
Indenture and the valid and continued registration of the Aircraft in
accordance with the Transportation Code.
(c) Appointment. For so long as the Aircraft remains registered
under the Transportation Code, the Owner Participant agrees to appoint
promptly a successor Owner Trustee meeting the requirements of Section
11.01(b) hereof in the event the Owner Participant has knowledge that the
Owner Trustee at any time shall not be a Citizen of the United States.
ARTICLE 12
LIABILITIES AND INTERESTS OF THE OWNER PARTICIPANT AND HOLDERS
Section 12.01. Liabilities of the Owner Participant. The Owner
Participant shall have no obligation or duty to the Lessee or to any Holder
with respect to the transactions contemplated by this Agreement, except those
obligations or duties expressly set forth in this Agreement, the Indenture,
the Trust Agreement, the Tax Indemnity Agreement, the Bills of Sale, the Lease
or any other Operative Agreement to which the Owner Participant is a party and
the Owner Participant shall not be liable for the performance by any party
hereto of such other party's obligations or duties hereunder. Under no
circumstances shall the Owner Participant as such be liable to the Lessee, nor
shall the Owner Participant be liable to any Holder, for any action or
inaction on the part of the Owner Trustee or the Indenture Trustee in
connection with this Agreement, the Indenture, the Lease, the Bills of Sale,
the Trust Agreement, the Engine Warranty Assignment, any other Operative
Agreement, any Original Agreement, the ownership of the Aircraft, the
administration of the Lessor's Estate or the Trust Indenture Estate or
otherwise, whether or not such action or inaction is caused by the willful
misconduct or gross negligence of the Owner Trustee or the Indenture Trustee.
Section 12.02. Interest of Holders of Certificates. A Holder of a
Certificate shall have no further interest in, or other right with respect to,
the Trust Indenture Estate when and if the principal and interest on all
Certificates held by such Holder and all other sums payable to such Holder
under this Agreement, under the Indenture and under such Certificates shall
have been paid in full.
ARTICLE 13
OTHER DOCUMENTS
Section 13.01. Consent of Lessee to Other Documents. The Lessee
hereby consents in all respects to the execution and delivery of the Trust
Agreement and the Indenture and to all of the terms of said documents, and the
Lessee acknowledges receipt of an executed counterpart of each of the Trust
Agreement and the Indenture; it being agreed that such consent shall not be
construed to require the Lessee's consent to any future supplement to, or
amendment, waiver or modification of the terms of the Trust Agreement, the
Indenture or the Certificates, except that prior to the occurrence and
continuance of an Event of Default, no section of the Indenture or the Trust
Agreement shall be amended or modified in any manner materially adverse to the
Lessee without its consent.
Section 13.02. Further Assurances. The Lessee hereby confirms to the
Owner Participant its covenants set forth in and obligations under the Lease.
The Lessee agrees that, except as otherwise provided in the Indenture, the
Owner Trustee may not enter into any amendment, modification or supplement of,
or give any waiver or consent with respect to, or approve any matter or
document as being satisfactory under the Lease without the prior consent of
the Indenture Trustee and the Owner Participant and that, except as otherwise
provided in the Indenture, upon an Indenture Event of Default, the Indenture
Trustee may act as the Lessor under the Lease to the exclusion of the Owner
Trustee. The Lessee further agrees to deliver to the Indenture Trustee and
the Owner Participant a copy of each notice, statement, request, report or
other communication given or required to be given to the Owner Trustee under
the Lease.
Section 13.03. No Retroactive Application. This Agreement, the
Lease, the Indenture, the Ancillary Agreement I and the Trust Agreement each
amend and restate, and the Tax Indemnity Agreement amends, the respective
original agreements with no intention of retroactive application. The
applicable original agreements have been restated for the convenience of the
parties and such amendments and restatements, and such amendment in the case
of the Tax Indemnity Agreement, are not intended to waive or modify the
obligations of any party which accrued or were to have been performed on or
prior to the Refunding Date under such unamended agreements (or, in the case
of this Agreement, the effective date hereof) or to deprive any party of its
rights and remedies in respect thereof.
ARTICLE 14
NOTICES
Section 14.01. Notices. All notices, demands, declarations and other
communications required by this Agreement shall be in writing and shall be
deemed received (a) if given by telecopier, when transmitted and the
appropriate telephonic confirmation received if transmitted on a Business Day
and during normal business hours of the recipient, and otherwise on the next
Business Day following transmission, (b) if given by certified mail, return
receipt requested, postage prepaid five Business Days after being deposited in
the United States mail, and (c) if given by FedEx service or other means, when
received or personally delivered, addressed:
(a) If to the Lessee, to its office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice President and Treasurer with a
copy to Senior Vice President and General Counsel at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (901)
395-4758; or to such other address as the Lessee shall from time to time
designate in writing to the Lessor, the Indenture Trustee and the Owner
Participant;
(b) If to the Lessor or the Owner Trustee, to its office at ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Department, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇; or to such
other address as the Lessor shall from time to time designate in writing to
the Lessee and the Indenture Trustee, with a copy to the Owner Participant;
(c) If to the Owner Participant, to its office at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: R. ▇▇▇▇▇ ▇▇▇▇▇▇▇;
telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇; or to such other
address as the Owner Participant may from time to time designate in writing
to the Lessee and the Indenture Trustee; and
(d) If to the Indenture Trustee or the Pass Through Trustee, to its
office at Two ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile
(▇▇▇) ▇▇▇-▇▇▇▇; or to such other address as the Indenture Trustee or the
Pass Through Trustee, as the case may be, shall from time to time designate
in writing to the Lessor, the Lessee and the Owner Participant.
ARTICLE 15
REFINANCING/REOPTIMIZATION
Section 15.01. Refinancing. (a) Subject to the terms and
conditions of this Section 15.01, the Lessee may request the Owner Participant
to participate in up to two refinancings (including the refinancing
contemplated by this Agreement on the Refunding Date), in whole but not in
part, of the Certificates prior to the end of the Basic Term (each a
"Refinancing"). Such Refinancings may be placed in either the private or
public markets in the United States and shall be denominated in United States
dollars, and shall be on terms reasonably satisfactory to the Owner Participant
and shall not materially adversely affect the Owner Participant. The Owner
Participant agrees to negotiate promptly in good faith to conclude an
agreement with the Lessee as to the terms of any such refinancing transaction
(including the terms of any debt to be issued in connection with such
refinancing and the documentation to be executed in connection therewith).
Without the prior written consent of the Owner Participant, the prospectus and
other offering materials relating to any Refinancing in the form of a public
offering shall not identify the Owner Participant and shall not include any
financial statements of the Owner Participant or any Affiliate thereof. In
connection with any such Refinancing in the form of a public offering, the
Lessee shall indemnify the Owner Participant for any liabilities under
federal, state or foreign securities laws resulting from such offering. With
the exception of the refinancing contemplated by this Agreement on the
Refunding Date, the aggregate principal amount of the new Certificates issued
in connection with each Refinancing shall be the same as the aggregate
principal amount outstanding on the Certificates being refinanced.
(b) Notwithstanding anything herein to the contrary, no Refinancing
will be permitted unless the Owner Participant and the Indenture Trustee shall
have received at least 15 days prior written notice of the scheduled closing
date of such Refinancing, the Owner Participant shall have been provided such
longer period required for a reasonable opportunity to review the relevant
documentation and the Owner Participant shall have determined in good faith
that neither it nor the Owner Trustee shall suffer any loss or expense or bear
any increased risk as a result of such Refinancing (including, without
limitation, any risk with respect to taxes or other adverse consequences to
the Owner Participant including the application of Revenue Procedures 75-21
and 75-28 and Section 467 of the Code and the Treasury Regulations promulgated
thereunder) for which (in the case of such loss, expense or tax) it has not
been or will not have been indemnified in connection with such Refinancing by
the Lessee in a manner satisfactory in all respects to the Owner Participant.
Prior to the consummation of any Refinancing pursuant to this Section
15.01, the Owner Participant and the Lessee shall agree upon a schedule
setting forth each installment of Basic Rent, Stipulated Loss Values, and
Termination Values payable pursuant to the Lease as a result of the
Refinancing in accordance with Section 3.04 of the Lease, and thereafter the
amounts set forth in such schedule shall become the amounts payable under the
Lease. Upon the consummation of the Refinancing, the evidence of indebtedness
issued pursuant to the Refinancing shall be considered "Certificates" for
purposes of this Agreement, the Lease and the Indenture.
(c) Notwithstanding the foregoing, the Owner Participant shall have
no obligation to proceed with any Refinancing transaction as contemplated by
this Section 15.01 unless the Lessee indemnifies the Owner Trustee and the
Owner Participant by agreement in form and substance satisfactory to each of
them, for any liability, obligation (other than the obligation to pay
principal and interest in respect of the refinanced indebtedness), cost or
expense (including, without limitation, reasonable attorneys' fees and
Make-Whole Premium and any other premiums or amounts due under the Indenture),
including any adverse tax consequences or impact, related to or arising out of
any such Refinancing transaction, except to the extent of amounts included in
Transaction Costs and payable by the Owner Participant as provided herein.
(d) Each party agrees to take or cause to be taken, at the Lessee's
sole cost and expense, all requested action, including, without limitation,
the execution and delivery of any documents and instruments, including,
without limitation, amendments or supplements to the Lease, which may be
reasonably necessary or desirable to effect such Refinancing, including, in
the case of the Owner Participant, direction to the Owner Trustee by the Owner
Participant to prepay the Certificates then outstanding; provided, however,
that such Refinancing shall be subject to the satisfaction of each of the
following conditions:
(i) Payment of principal, accrued interest, Make-Whole Premium and
Breakage Costs, if any, and all other sums due and owing on the Certificates
payable under the Indenture;
(ii)Payment in full of all other amounts then due and owing by the
Lessee under this Agreement, the Indenture, the Lease, the Trust Agreement,
and the Certificates then outstanding shall have been made by the Lessee;
(iii)Such party shall have received such opinions of counsel
(including, without limitation, an opinion received by the Owner
Participant from independent tax counsel and reasonably satisfactory to the
Lessee that such Refinancing shall not result in any adverse tax
consequences to such Owner Participant, unless the Lessee shall have agreed
to provide an indemnity in respect thereof satisfactory in form and
substance to the Owner Participant), certificates and other documents as
it may reasonably request, each in form and substance reasonably
satisfactory to such party;
(iv)All authorizations, approvals and consents which in the reasonable
judgment of the Owner Participant are necessary for such Refinancing shall
have been obtained;
(v) The Lessee shall have provided or agreed to provide to the Owner
Participant, as Supplemental Rent under the Lease, sufficient funds to pay
any Breakage Costs, Make-Whole Premium and any other amounts due under the
Indenture;
(vi)The satisfaction or waiver by each other party to this Agreement
of the conditions set forth in this Section 15.01 to such party's
obligations under this Section 15.01;
(vii)No Event of Default shall have occurred and be continuing or
would occur immediately after giving effect to such Refinancing; and
(viii) The documentation relating to such Refinancing shall permit
the Lessee to place the Refinancing loan certificates with an ERISA Plan.
The Lessee shall not indemnify the Owner Participant, or any of the Owner
Participant's Affiliates, assigns, officers, directors, employees, agents
and servants, for any Taxes, within the meaning of Section 8 hereof, or
Expenses, within the meaning of Section 9 hereof, arising under or in
connection with any "prohibited transaction" within the meaning of Section
406 of ERISA or Section 4975 of the Code, if the sole underwriter or the
manager or co-manager of the underwriting syndicate or the selling or
placement agent of the Refinancing loan certificates has an exemption from
the prohibited transaction rules under Section 406 of ERISA and Section 4975
of the Code with respect to pass through certificates, such as Prohibited
Transaction Exemption 90-24 or any other comparable exemption, unless such
exemption is not available or is not valid with respect to such Refinancing
loan certificates at the time of such prohibited transaction. If such
exemption is not available or is not valid, then the Lessee shall indemnify
the Owner Participant pursuant to, and to the extent provided for, under
Section 8 and 9 hereof for Taxes and Expenses arising under or in
connection with any "prohibited transaction", within the meaning of Section
406 of ERISA or Section 4975 of the Code, resulting from such placement.
(e) Any debt to be issued in connection with a Refinancing shall have
an interest rate that is fixed for the entire term of such debt and shall
not include any debt whose fixed interest rate is reset at any time during
the term of such debt.
Section 15.02. Reoptimization. (a) If a Change in Tax Rate occurs
prior to the end of the Basic Term, then, subject to the terms and conditions
of this Section 15.02 and Section 3.04 of the Lease, the Owner Participant
may, upon 30 days' prior notice to the Lessee, the Indenture Trustee, the
Owner Trustee and the Holders, elect to modify the schedule of payments of
principal of the certificates issued ("Refinancing Certificates") in
connection with any Refinancing effected after the Refunding Date using
private debt (not including debt issued pursuant to an exemption from
registration under the Securities Act relying on Rule 144A promulgated
thereunder but otherwise marketed in a manner substantially similar to
securities registered under the Securities Act, and not including debt issued
in connection with any offering of securities registered under the Securities
Act) due on each remaining Rent Payment Date on or commencing on the Rent
Payment Date next succeeding the date mutually agreed to by the Owner
Participant, the Lessee and the Indenture Trustee on which the Owner
Participant shall make such modification (the "Reoptimization Date"). Promptly
after making such modification, the Owner Participant shall furnish each party
hereto written notice of the amounts so recalculated.
(b) Adjustments to Refinancing Certificates. On the Reoptimization
Date, subject to the satisfaction on or before the Reoptimization Date of the
conditions set forth in Section 15.02(c), the Owner Trustee will issue and
deliver and the Indenture Trustee will authenticate, and each holder of a
Refinancing Certificate will accept delivery of, a new Refinancing Certificate
or Refinancing Certificates (in replacement of each Refinancing Certificate
then held by such holder, which Refinancing Certificates shall be surrendered
to the Indenture Trustee for cancellation) containing such changed principal
installments (expressed as a percentage of the original principal amount of
such Refinancing Certificate) as shall have been recalculated by the Owner
Participant, but in the same principal amount as, and containing terms
identical to, except as otherwise contemplated by Section 15.02(d) hereof, the
Refinancing Certificates originally issued in connection with the Operative
Agreements.
(c) Conditions to the Obligations of the Holders of the Refinancing
Certificates on the Reoptimization Date. The obligation of each holder of a
Refinancing Certificate to accept delivery of a new Refinancing Certificate on
the Reoptimization Date, and to surrender on such Reoptimization Date any
Refinancing Certificate then held by it, is subject to the following
conditions precedent having been satisfied on or before the Reoptimization
Date:
(i) the requirements of Section 15.02(d) hereof shall have been
satisfied;
(ii)the following documents, in form and substance satisfactory to
such Holder, shall have been duly authorized, executed and delivered by the
party or parties thereto and shall be in full force and effect: (A) if the
payments of Basic Rent, Stipulated Loss Values and Termination Values with
respect to the Term have been changed, an amendment to the Lease, dated the
Reoptimization Date, (B) an amendment to the Indenture setting forth any
changed repayment schedule to the Refinancing Certificates, dated the
Reoptimization Date and (C) replacement Refinancing Certificates; and
(iii)in connection with any Reoptimization the Owner Participant
shall pay or agree to pay all reasonable costs and expenses incurred by the
Lessee, the Owner Trustee, the Indenture Trustee and each Holder of a
Refinancing Certificate (including, without limitation, reasonable legal
fees and expenses) in connection with any such reoptimization.
(d) Payment Schedules. Except as otherwise provided in this Section
15.02 as long as the Refinancing Certificates remain outstanding, the payment
schedules for the Refinancing Certificates shall not be modified.
ARTICLE 16
[INTENTIONALLY LEFT BLANK]
ARTICLE 17
MISCELLANEOUS
Section 17.01. Owner for Federal Tax Purposes. It is hereby agreed
between the Owner Participant and the Lessee (but the Lessee makes no
representation to such effect) that for Federal income tax purposes the Owner
Participant will be the owner of the Aircraft and the Lessee will be the
lessee of the Aircraft.
Section 17.02. [Intentionally Left Blank.]
Section 17.03. Counterparts. This Agreement may be executed by the
parties in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
Section 17.04. No Oral Modifications. Neither this Agreement nor
any of its terms may be terminated, amended, supplemented, waived or modified
orally, but only by an instrument in writing signed by the party against which
the enforcement of the termination, amendment, supplement, waiver or
modification is sought. No such written termination, amendment, supplement,
waiver or modification shall be effective unless a signed copy shall have been
delivered to and executed by the Owner Trustee and the Indenture Trustee. A
copy of each such termination, amendment, supplement, waiver or modification
shall also be delivered to each other party to this Agreement other than the
Original Loan Participants.
The consent of the Pass Through Trustee, in its capacity as a party
to this Agreement and not as a Holder, shall not be required to modify, amend
or supplement this Agreement or to give any consent, waiver, authorization or
approval with respect to this Agreement under the circumstances in which the
consent of the Indenture Trustee would not be required for such modification,
amendment, supplement, consent, waiver or approval in accordance with Section
8.01(b) of the Indenture, provided that the Pass Through Trustee shall be
entitled to receive an Opinion of Counsel (as defined in the Pass Through
Agreement) necessary, in its sole discretion, to establish that the Indenture
Trustee's consent would not be required under such circumstances.
Section 17.05. Captions. The table of contents preceding this
Agreement and the headings of the various Articles and Sections of this
Agreement are for convenience of reference only and shall not modify, define,
expand or limit any of the terms or provisions of this Agreement.
Section 17.06. Successors and Assigns. The terms of this Agreement
shall be binding upon, and shall inure to the benefit of, the Lessee and its
successors and permitted assigns, the Owner Participant and its successors and
permitted assigns, the Owner Trustee and its successors as Owner Trustee (and
any additional owner trustee appointed) under the Trust Agreement, the
Indenture Trustee and its successors as Indenture Trustee (and any additional
indenture trustee appointed) under the Indenture and the Pass Through Trustee
and its successors as Pass Through Trustee (and any additional pass through
trustee appointed).
Section 17.07. Concerning the Owner Trustee, the Indenture Trustee
and the Pass Through Trustee. Each of FSB and SSB is entering into this
Agreement solely in their respective capacities (except to the extent
otherwise expressly indicated), in the case of FSB, not in its individual
capacity but solely as Owner Trustee under the Trust Agreement, in the case of
SSB, not in its individual capacity but solely as Indenture Trustee under the
Indenture and as Pass Through Trustee under the Pass Through Agreement, and
except as otherwise expressly provided in this Agreement or in the Lease, the
Indenture, the Pass Through Agreement or the Trust Agreement, neither FSB, nor
SSB, shall be personally liable for or on account of its statements,
representations, warranties, covenants or obligations under this Agreement;
provided, however, that each of FSB and SSB accepts the benefits running to it
under this Agreement, and each agrees that (except as otherwise expressly
provided in this Agreement or any other Operative Agreement to which it is a
party) it shall be liable in its individual capacity for (a) its own gross
negligence or willful misconduct (whether in its capacity as trustee or in its
individual capacity), (b) any breach of representations and warranties or any
breach of covenants made in its individual capacity pursuant to or in
connection with this Agreement or the other Operative Agreements to which it is
a party, (c) any breach, in the case of the Owner Trustee, of its covenants
contained in Sections 3.05 and 3.08 of the Indenture, (d) the failure to use
ordinary care in receiving, handling and disbursing funds, (e) in the case of
the Owner Trustee, Lessor's Liens attributable to it in its individual
capacity, (f) in the case of the Indenture Trustee, Indenture Trustee's Liens
and (g) taxes, fees or other charges on, or based on, or measured by, any
fees, commissions or compensation received by it in connection with the
transactions contemplated by the Operative Agreements.
Section 17.08. 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, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 17.09. Public Release of Information. Subject to applicable
legal requirements (including, without limitation, securities laws
requirements, other regulatory requirements and other legally compelled
disclosures), so long as there shall not have occurred an Event of Default or
Indenture Event of Default, each party to this Agreement shall in each
instance obtain the prior written approval of each other party to this
Agreement concerning the exact text and timing of news releases, articles and
other information releases to the public media concerning any Operative
Agreements.
Section 17.10. Certain Limitations on Reorganization. The Indenture
Trustee agrees that, if (i) the Lessor's Estate or the trust created by the
Trust Agreement becomes the property of, a debtor subject to the
reorganization provisions of the Bankruptcy Code or any other applicable
bankruptcy or insolvency statutes, (ii) pursuant to such reorganization
provision, the Owner Participant is held to have recourse liability to the
debtor or the trustee of the debtor directly or indirectly on account of any
amount payable as principal, interest or premium on the Certificates, and
(iii) the Indenture Trustee actually receives any Recourse Amount which
reflects any payment by the Owner Participant on account of (ii) above, then
the Indenture Trustee, as the case may be, shall promptly refund to the Owner
Participant such Recourse Amount. For purposes of this Section 17.10,
"Recourse Amount" means the amount by which the portion of such payment by the
Owner Participant on account of clause (ii) above received by the Indenture
Trustee exceeds the amount which would have been received by the Indenture
Trustee if the Owner Participant had not become subject to the recourse
liability referred to in (ii) above. Nothing contained in this Section shall
prevent the Indenture Trustee from enforcing any individual obligation (and
retaining the proceeds thereof) of the Owner Participant under this Agreement
or any other Operative Agreement to the extent herein or therein provided, for
which the Owner Participant has expressly agreed by the terms of this
Agreement to accept individual responsibility.
Section 17.11. GOVERNING LAW. THIS AGREEMENT SHALL IN ALL RESPECTS
BE GOVERNED BY, AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE BUT
WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS, AND IS BEING
DELIVERED IN NEW YORK.
Section 17.12. Section 1110 Compliance. Notwithstanding any
provision herein or elsewhere contained to the contrary, it is understood and
agreed among the parties hereto that the transactions contemplated by this
Agreement and the other Operative Agreements are expressly intended to be,
shall be and should be construed so as to be, entitled to the full benefits of
Section 1110 of the Bankruptcy Code from time to time with respect to the
right to repossess the Airframe, the Engines and any Parts as provided herein,
and in any circumstances where more than one construction of the terms and
conditions of this Agreement is possible, a construction which would preserve
such benefits shall control over any construction which would not preserve
such benefits or would render them doubtful.
ARTICLE 18
CONFIDENTIALITY
Section 18.01. Confidentiality. Each party hereto agrees (on behalf
of itself and each of its Affiliates, agents, directors, officers, employees
and representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature, any non-public information supplied to it pursuant to this
Agreement which is identified by the Person supplying the same as being
confidential at the time the same is delivered to such party, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for any of the parties hereto, (iii) to bank examiners or similar
regulatory authorities, auditors or accountants, (iv) in connection with any
litigation to which any one or more of the parties hereto is a party relating
to the transactions contemplated hereby or by any of the Operative Agreements,
(v) to an Affiliate of the parties hereto, (vi) to any assignee or participant
(or prospective assignee or participant) or other transferee so long as such
assignee or participant (or prospective assignee or participant) or other
transferee first executes and delivers to the respective party making such
assignment or participation an agreement in writing to be bound by the
provisions of this Section 18.01 or (vii) in the case of the Owner Participant
or the Owner Trustee (in its individual or trust capacity) to the Owner
Trustee (in its individual or trust capacity) or to the Owner Participant, as
the case may be.
IN WITNESS WHEREOF, the parties have caused this Participation
Agreement to be executed by their respective, duly authorized officers and this
Participation Agreement shall be effective this 17th day of October, 1996.
LESSEE:
FEDERAL EXPRESS CORPORATION
By:__________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Treasurer and Managing
Director - Structured Finance
OWNER PARTICIPANT:
AMERITECH CREDIT CORPORATION
By:__________________________________________
Name:
Title:
OWNER TRUSTEE:
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Owner Trustee
By:__________________________________________
Name:
Title:
INDENTURE TRUSTEE:
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Indenture Trustee
By:__________________________________________
Name:
Title:
PASS THROUGH TRUSTEE:
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Pass Through Trustee
By:__________________________________________
Name:
Title:
ORIGINAL LOAN PARTICIPANTS:
▇▇▇▇▇▇ GUARANTY TRUST COMPANY
OF NEW YORK,
as Agent and as an Original Loan Participant
By:__________________________________________
Name:
Title:
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By:__________________________________________
Name:
Title:
THE CHASE MANHATTAN BANK
By:__________________________________________
Name:
Title:
COMMERZBANK AG, ATLANTA AGENCY
By:__________________________________________
Name:
Title:
NATIONSBANK, N.A. (SOUTH)
By:__________________________________________
Name:
Title:
SCHEDULE I
CERTIFICATE INFORMATION
1. Federal Express Corporation Pass Through Trust, 1996-B1
Federal Express Corporation Trust No. N586FE
Interest Rate: 7.39%
Maturity: January 30, 2013
Principal Amount: $51,049,000.00
2. Federal Express Corporation Pass Through Trust, 1996-B2
Federal Express Corporation Trust No. N586FE
Interest Rate: 7.84%
Maturity: January 30, 2015
Principal Amount: $11,723,000.00
SCHEDULE II
DEFINITIONS
GENERAL PROVISIONS
The following terms shall have the following meanings for all
purposes of the Operative Agreements (other than the Pass Through Agreement
and the Series Supplements) referred to below, unless otherwise defined in an
Operative Agreement or the context thereof shall otherwise require. In the
case of any conflict between the provisions of this Schedule and the
provisions of any Operative Agreement, the provisions of such Operative
Agreement shall control the construction of such Operative Agreement.
Unless the context otherwise requires, (i) references to
agreements shall be deemed to mean and include such agreements as amended and
supplemented from time to time, and (ii) references to parties to agreements
shall be deemed to include the successors and permitted assigns of such
parties.
DEFINED TERMS:
Additional Insured. As defined in Article 13 of the Lease.
Additional Leverage Amount. An amount equal to 5.506252521% of the
outstanding principal amount of the Original Loan Certificates to be
refinanced on the Refunding Date.
Aeronautics Authority. As appropriate, the Federal Aviation
Administration and/or the Administrator of the Federal Aviation
Administration, any successor to the former United States Civil Aeronautics
Board, or any Person, governmental department, bureau, commission or agency
located in the United States succeeding to the functions of any of the
foregoing.
Affiliate. 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" (including "controlled
by" and "under common control with") shall mean 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. In no event shall the Owner Trustee or the Lessor be deemed an
Affiliate of the Owner Participant.
After-Tax Basis. A basis such that any payment received or deemed
to have been received by a Person shall be supplemented by a further payment
to such Person so that the sum of the two payments, after deduction of all
Taxes resulting from the receipt or accrual of such payments, shall be equal
to the payment received or deemed to have been received. In the case of
amounts payable to the Lessor, the Owner Participant, or any corporate
Affiliate of the Owner Participant, it shall be presumed that such Person is
at all times subject to Federal income tax at the maximum marginal rate
generally applicable to corporations from time to time and actual state, local
and foreign income taxes.
Agent. ▇▇▇▇▇▇ Guaranty Trust Company of New York and its
successors and permitted assigns as Agent for the Original Loan Participants
pursuant to Article 16 of the Original Participation Agreement.
Air Carrier. Any U.S. Air Carrier and any "foreign air carrier"
(as defined in the Transportation Code) as to which there is in force a permit
granted under Section 41302 of the Transportation Code.
Aircraft. The Airframe (or any permitted substitute airframe)
together with three Engines (whether any of which is an initial Engine or a
Replacement Engine) whether or not any of such initial or Replacement Engines
may from time to time be installed on such Airframe or may be installed on any
other airframe or on any other aircraft, including any aircraft substituted
pursuant to Section 11.03 of the Lease.
Airframe. The ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MD-11F aircraft (excluding the
Engines or engines from time to time installed thereon) leased by the Lessor
to the Lessee pursuant to the Lease and the initial Lease Supplement and
having the United States FAA Registration Number initially and manufacturer's
serial number specified in the initial Lease Supplement, including (i) all
Parts in respect thereof and (ii) any replacement airframe which may be
substituted pursuant to Section 11.03 of the Lease.
Amendment No. 1 to the Original Tax Indemnity Agreement. Amendment
No. 1 to the Original Tax Indemnity Agreement (Federal Express Corporation
Trust No. N586FE), dated as of October 15, 1996.
Ancillary Agreement. Any written agreement of the Lessee to which
the Lessor is a party or to which the Lessor has consented in writing entered
into on the Delivery Date or the Refunding Date or any date thereafter in
connection with the transactions contemplated by the Operative Agreements, as
such agreement may be amended and supplemented from time to time with the
consent of the Lessor and delivered to the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Owner Participant.
Ancillary Agreement I. The Ancillary Agreement I (Federal Express
Corporation Trust No. N586FE), dated the Delivery Date, as amended and
restated as of the Refunding Date, among the Lessee, the Owner Trustee, not in
its individual capacity, but solely as Owner Trustee, the Owner Participant
and the Indenture Trustee not in its individual capacity, but solely as
Indenture Trustee, as originally executed or as amended, modified or
supplemented with the consent of all the parties thereto.
Ancillary Agreement II. The Ancillary Agreement II (Federal
Express Corporation Trust No. N586FE), dated the Refunding Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as Owner
Trustee, the Owner Participant and the Indenture Trustee not in its individual
capacity, but solely as Indenture Trustee, as originally executed or as
amended, modified or supplemented with the consent of all the parties thereto.
Appraisal. The report prepared by BK Associates, Inc. and
delivered to the Owner Participant on the Delivery Date pursuant to Section
4.01(n) of the Original Participation Agreement.
Bankruptcy Code. The Federal Bankruptcy Code of 1978, as amended,
and any successor thereto.
Bankruptcy Default. An event specified in Section 16.01(e), (f)
or (g) of the Lease which either does or, with the giving of notice or lapse
of time or both, would constitute an Event of Default.
Basic Rent. The aggregate periodic rent for the Interim Term and
the Basic Term payable for the Aircraft throughout the Basic Term pursuant to
Section 3.02 of the Lease, adjusted pursuant to Article 3 of the Lease.
Basic Term. The period commencing at the beginning of the day on
the Commencement Date and ending at the end of the day on March 22, 2017, or
such earlier date on which the Lease shall be terminated as provided therein.
Beneficial Interest. The interest of the Owner Participant under
the Trust Agreement.
Bills of Sale. Collectively, the FAA ▇▇▇▇ of Sale and the
Warranty ▇▇▇▇ of Sale.
Breakage Costs. Has the meaning specified in Schedule II to the
Original Participation Agreement.
Business Day. Any day on which commercial banks are not
authorized or required to close in New York, New York, Memphis, Tennessee and
the city in which the office or agency in the United States is maintained by
the Pass Through Trustee for the payment of the Pass Through Certificates, and
after the Lien of the Indenture is discharged, Salt Lake City, Utah.
Certificates. The Equipment Trust Certificates (Federal Express
Corporation Trust No. N586FE), issued by the Owner Trustee pursuant to the
Indenture and any certificate issued in exchange therefor or replacement
thereof pursuant to the Indenture.
Change in Tax Rate. Any amendment, modification, deletion,
addition, or change to the Code which is enacted into law after the Delivery
Date which changes the highest marginal statutory rate of Federal income tax
applicable to the Owner Participant (other than a change which is in the
nature of a minimum tax).
Citizen of the United States. A citizen of the United States as
defined in Section 40102(a)(15) of the Transportation Code, or any analogous
part of any successor or substituted legislation or regulation at the time in
effect.
Closings. The closing with respect to the acquisition of the Pass
Through Certificates by the Underwriters and the closing with respect to the
refunding of the Original Loan Certificates.
Code. Except as otherwise provided, the Internal Revenue Code of
1986, as amended from time to time.
Commencement Date. January 30, 1997.
Corporate Trust Administration. The principal office of the
Indenture Trustee located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Department, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Participant and the Owner Trustee.
Corporate Trust Department. The principal office of the Owner
Trustee located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, or such other office at which the Owner
Trustee's corporate trust business shall be administered which the Owner
Trustee shall have specified by notice in writing to the Lessee, the Owner
Participant and the Indenture Trustee.
CRAF Program. Has the meaning specified in Section 7.01(f) of the
Lease.
Debt Rate. The weighted average (based on Outstanding principal
amount) rate of interest on the Certificates issued pursuant to the Indenture.
Default. Any event or condition which, with the lapse of time or
the giving of notice, or both, would constitute an Event of Default.
Delivery Date. September 23, 1996.
EBO Date. As defined in Section 4.02(a)(F) of the Lease.
EBO Price. Has the meaning specified in Section 4.02(a)(F) of the
Lease.
Engine. Each of the three General Electric CF6-80C2-D1F engines
listed by its manufacturer's serial number in the initial Lease Supplement and
leased pursuant to the Lease, whether or not from time to time installed on
the Airframe or installed on any other airframe or on any other aircraft, and
any Replacement Engine which may from time to time be substituted for an
Engine pursuant to Section 7.02(a)(vii), 10.03, 11.03, 11.04 or 12.02 of the
Lease, together with all Parts related thereto. Except as otherwise provided,
at such time as a Replacement Engine shall be so substituted and the Engine
for which the substitution is made shall be released from the Lien of the
Indenture, such replaced Engine shall cease to be an "Engine" under the Lease.
The term "Engines" means, as of any date of determination, all Engines then
leased to the Lessee pursuant to the Lease.
Engine Consent. The Engine Consent dated as of September 1, 1996,
executed by the Engine Manufacturer, as the same may be amended, modified or
supplemented from time to time.
Engine Manufacturer. General Electric Company, a New York
corporation.
Engine Warranty Assignment. The Engine Warranty Assignment
(Federal Express Corporation Trust No. N586FE), dated as of September 1, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan. An employee benefit plan subject to Title I of ERISA,
or an individual retirement account or plan subject to Section 4975 of the
Code.
Estimated Expense Amount. Has the meaning specified in Section
10.01(a) of the Participation Agreement.
Event of Default. Each of the events specified in Article 16 of
the Lease.
Event of Loss. Any of the following events with respect to the
Aircraft, the Airframe or any Engine: (i) loss of such property or its use (A)
due to theft or disappearance for a period in excess of 30 days (or such
longer period not to exceed 60 days from the end of such 30 day period if and
so long as the location of such property is known and the Lessee is pursuing
the recovery thereof) or to the end of the Term, if less, unless such event
constitutes an Event of Loss under clause (i)(B) or clause (ii) below, or (B)
due to the destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use by Lessee for any reason whatsoever;
(ii) any damage to such property which results in an insurance settlement with
respect to such property on the basis of a total loss, or constructive or
compromised total loss; (iii) (1) condemnation, confiscation or seizure of, or
requisition of title to such property by the Government, any foreign
government or purported government or any agency or instrumentality thereof,
or (2) condemnation, confiscation, or seizure of, or requisition or taking of,
use of such property (A) by the government of Canada, France, Germany, Japan,
the Netherlands, Sweden, Switzerland or the United Kingdom, or instrumentality
or agency of any such foreign government, for a period in excess of 180 days,
(B) by a foreign government (other than any such government referred to in the
immediately preceding clause (A)), or instrumentality or agency of any such
foreign government, or any purported government or instrumentality or agency
thereof, or (C) by the Government for a period extending beyond the Term
provided that no Event of Loss shall be deemed to have occurred, and the Term
shall be extended automatically for a period of up to six months beyond the
end of the Term in the event that the Aircraft or the Airframe or any Engine
is requisitioned by the Government pursuant to an activation as part of the
CRAF Program described in Section 7.02(a)(iv) of the Lease; or (iv) as a
result of any law, rule, regulation, order or other action by the Aeronautics
Authority or other governmental body having jurisdiction, the use of the
Aircraft or Airframe in the normal course of air transportation of cargo shall
have been prohibited for a period of six (6) consecutive months, unless the
Lessee, prior to the expiration of such six (6) month period, shall be
diligently carrying forward all steps which are necessary and desirable to
permit the normal use of the Aircraft or Airframe provided, however, that an
Event of Loss shall be deemed to have occurred if (x) the Lessee fails to
continue diligently carrying forward all such steps or (y) the use of the
Aircraft or the Airframe in the normal course of air transportation of cargo
shall have been prohibited for a period of an additional 12 months following
such 6 month period or (z) unless waived by the Lessor, the Term shall have
expired. The date of such Event of Loss shall be (t) the 30th day or the 90th
day, as the case may be, following loss of such property or its use due to
theft or disappearance; (u) the date of any destruction, damage beyond
economic repair or rendition of such property permanently unfit for normal
use; (v) the date of any insurance settlement on the basis of a total loss or
constructive or compromised total loss; (w) the date of any condemnation,
confiscation, seizure or requisition of title of such property; (x) the 181st
day following condemnation, confiscation, seizure or requisition for use of
such property by a foreign government referred to in clause (iii)(2)(A) above
and the date of such condemnation, confiscation, seizure or requisition in the
case of any other foreign government or instrumentality or agency thereof; (y)
the last day of the Term in the case of requisition for use of such property
by the Government or (z) the last day of the 6 month or additional 12 month
period, referred to in clause (iv) above. An Event of Loss with respect to
the Aircraft shall be deemed to have occurred if any Event of Loss occurs with
respect to the Airframe.
Excepted Payments. Collectively, (i) indemnity or other payments
of expenses paid or payable by the Lessee in respect of the Owner Participant,
the Owner Trustee in its individual capacity or any of their respective
successors, permitted assigns, directors, officers, employees, servants and
agents or Affiliates, pursuant to Article 8, 9, or 10 and Section 15.01 of the
Participation Agreement or any indemnity hereafter granted to the Owner
Participant or the Owner Trustee in its individual capacity pursuant to
Section 7.01(e), Article 9 or Section 11.03(a) of the Lease or Section 15.01
of the Participation Agreement, (ii) proceeds of public liability insurance
(or government indemnities in lieu thereof) in respect of the Aircraft payable
as a result of insurance claims paid for the benefit of, or losses suffered
by, the Owner Trustee or the Indenture Trustee in their respective individual
capacities or by the Owner Participant, or their respective successors,
permitted assigns or Affiliates, (iii) proceeds of insurance maintained with
respect to the Aircraft by the Owner Participant (whether directly or through
the Owner Trustee) maintained in accordance with the provisions of but not
required under Article 13 of the Lease, (iv) all right, title and interest of
the Owner Participant in, to and under the Tax Indemnity Agreement and
payments of Supplemental Rent by the Lessee in respect of any amounts payable
under the Tax Indemnity Agreement, (v) any amounts payable by the Lessee to
the Owner Participant or the Owner Trustee in its individual capacity, after
the release thereof from the Lien of the Indenture, (vi) subject to Section
3.05 of the Lease, payments constituting increases in Basic Rent attributable
to payments arising pursuant to Section 5 of the Tax Indemnity Agreement,
(vii) any right to demand, collect or otherwise receive and enforce the
payment of any amount described in clauses (i) through (vi) above and (viii)
any payments in respect of interest to the extent attributable to the payments
referred to in clauses (i) through (vi) above.
Exempt Recipient. A person described in Section 6049(b)(4) of the
Code.
Expense; Expenses. Have the meaning specified in Section 9.01(a)
of the Participation Agreement.
FAA ▇▇▇▇ of Sale. The ▇▇▇▇ of sale for the Airframe on AC Form
8050-2, or such other form as may be approved by the Aeronautics Authority,
executed by the Lessee in favor of the Owner Trustee and dated the Delivery
Date.
FSB. First Security Bank, National Association, a national banking
association.
FSC. ▇▇▇▇▇▇ International Sales Corporation, a United States
Virgin Islands corporation.
Fair Market Renewal Term. A term with respect to which the Lessee
has exercised its option to renew the Lease pursuant to the second paragraph
of Section 4.01(a) thereof and with respect to which the conditions set forth
in such Section 4.01(a) are met.
Fair Market Rental. An amount determined on the basis of, and
equal in amount to, the rental which would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and willing
lessor unaffiliated with such lessee, neither being under any compulsion to
lease. In such determination, except for purposes of Section 17.01 of the
Lease, it shall be assumed that the Aircraft is in at least the condition
required under the Lease in the case of return of the Aircraft pursuant to
Article 12 of the Lease and Fair Market Rental shall be determined in
accordance with the provisions of Section 4.03 of the Lease. For purposes of
Section 17.01 of the Lease, such determination shall be made on an "as is,
where is" basis by a qualified independent appraiser selected by the Lessor
and the costs and expenses of the appraisal shall be borne by the Lessee,
unless the Lessor has not obtained possession of the Aircraft pursuant to such
Section 17.01, in which case an appraiser shall not be appointed and such Fair
Market Rental shall be deemed to be zero.
Fair Market Value. An amount determined on the basis of, and
equal in amount to, the value which would be obtained in an arm's-length
transaction between an informed and willing purchaser under no compulsion to
buy and an informed and willing seller unaffiliated with such purchaser and
under no compulsion to sell, assuming the Aircraft (or other property) is
unencumbered by the Lease. In such determination, except for purposes of
Section 17.01 of the Lease, it shall be assumed that the Aircraft is in at
least the condition required under the Lease in the case of return of the
Aircraft pursuant to Article 12 of the Lease and Fair Market Value shall be
determined in accordance with the provisions of Section 4.03 of the Lease. For
purposes of Section 17.01 of the Lease, such determination shall be made on an
"as is, where is" basis by a qualified independent appraiser selected by the
Lessor and the costs and expenses of the appraisal shall be borne by the
Lessee, unless the Lessor has not obtained possession of the Aircraft free and
clear of all Liens and unencumbered by the Lease pursuant to such Section
17.01, in which case an appraiser shall not be appointed and such Fair Market
Value shall be deemed to be zero.
Federal Aviation Administration; FAA. The United States Federal
Aviation Administration and any successor agency or agencies thereto.
Fixed Renewal Rent. Semi-annual payments of rent during the Fixed
Renewal Term equal to the lesser of (i) Fair Market Rental as determined as of
the commencement of such Fixed Renewal Term and (ii) 50% of the average actual
semi-annual Basic Rent payable during the Basic Term.
Fixed Renewal Term. The term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the first paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth in
such Section 4.01(a) are met.
Government. The United States of America or an agency or
instrumentality thereof the obligations of which bear the full faith and
credit of the United States of America.
GTA. The General Terms Agreement dated as of July 3, 1991 between
the Engine Manufacturer and the Lessee related to the purchase by the Lessee
of the Engines as originally executed or as modified, amended or supplemented
in accordance with the terms thereof, but only insofar as the General Terms
Agreement relates to the Engines, to the extent assigned to the Owner Trustee
pursuant to the Engine Warranty Assignment.
Holder of a Certificate; Certificate Holder; Holder. As of any
particular time, the Person in whose name a Certificate shall be registered
(but not including the holder of any Pass Through Certificate).
Indemnitee. Each of FSB, in its individual capacity and as Owner
Trustee and Lessor, the Agent (to the extent set forth in Articles 8 and 9 of
the Original Participation Agreement), the Owner Participant, the Original
Loan Participants (to the extent set forth in Articles 8 and 9 of the Original
Participation Agreement), the Indenture Trustee, in its individual capacity
and as trustee, and any successor (including any trustee which may succeed to
the Lessor's interest under the Lease), Affiliate, assign, officer, director,
employee, agent and servant of any of the foregoing, the Lessor's Estate and
the Trust Indenture Estate.
Indenture. The Trust Indenture and Security Agreement (Federal
Express Corporation Trust No. N586FE), dated as of September 1, 1996, as
amended and restated as of October 15, 1996, between the Lessor and the
Indenture Trustee, as supplemented by the Indenture and Security Agreement
Supplement, and as said Indenture may from time to time be further
supplemented or amended, including any amendment or supplement thereto entered
into from time to time pursuant to the applicable provisions of the Indenture.
Indenture and Security Agreement Supplement. The Indenture and
Security Agreement Supplement No. 1 (Federal Express Corporation Trust No.
N586FE), dated September 23, 1996, as such Indenture and Security Agreement
Supplement shall be amended or supplemented from time to time and any other
supplement to the Indenture, substantially in the form of Exhibit A to the
Indenture.
Indenture Default. Any event or condition which, with the lapse
of time or the giving of notice, or both, would constitute an Indenture Event
of Default.
Indenture Documents. Has the meaning specified in the Granting
Clause of the Indenture.
Indenture Event of Default. Each of the events specified in
Section 7.01 of the Indenture.
Indenture Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, not in its individual capacity but solely as
Indenture Trustee under the Indenture and each other Person which may from
time to time be acting as successor trustee under the Indenture.
Indenture Trustee's Liens. Any Lien on the Trust Indenture Estate
resulting from (i) claims against the Indenture Trustee not related to the
administration of the Trust Indenture Estate or any transactions pursuant to
the Indenture or any document included in the Trust Indenture Estate, (ii) any
act or omission of the Indenture Trustee which is not related to the
transactions contemplated by the Operative Agreements or is in violation of
any of the terms of the Operative Agreements or (iii) Taxes imposed against
the Indenture Trustee in its individual capacity against which the Lessee has
not indemnified (and is not obligated to indemnify) the Indenture Trustee in
such capacity.
Independent Appraisal. An appraisal conducted pursuant to Section
4.03 of the Lease.
Independent Investment Banker. An independent investment banking
institution of national standing appointed by the Lessee that is independent
in fact, does not have any direct financial interests, or any material
indirect financial interest, in the Lessee or any Affiliate of the Lessee, and
is not connected with the Lessee or any Affiliate of the Lessee, as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions; provided, that if the Indenture Trustee shall
not have received written notice of such an appointment at least 10 days prior
to the Prepayment Date, "Independent Investment Banker" shall mean such an
institution appointed by the Indenture Trustee.
Interim Term. The period commencing on the Delivery Date and
ending at the end of the day immediately preceding the Commencement Date.
Invoice. The invoice for the Aircraft given by the Lessee to the
Lessor.
Lease. The Lease Agreement (Federal Express Corporation Trust No.
N586FE), dated as of September 1, 1996, as amended and restated as of October
15, 1996, entered into by the Lessor and the Lessee concurrently with the
execution and delivery of the Indenture, as said Lease may from time to time
be supplemented or amended, or its terms waived or modified, to the extent
permitted by, and in accordance with, the terms of the Indenture, including,
without limitation, supplementation by one or more Lease Supplements entered
into pursuant to the applicable provisions of the Lease.
Lease Supplement. The Lease Supplement No. 1 (Federal Express
Corporation Trust No. N586FE), dated September 23, 1996, as such Lease
Supplement shall be amended or supplemented from time to time and any other
supplement to the Lease, substantially in the form of Exhibit A to the Lease.
Lease Term. The period commencing on the Delivery Date and ending
at the end of the Basic Term.
Lessee. Federal Express Corporation, a Delaware corporation, and
its successors and permitted assigns.
Lessee Documents. Has the meaning set forth in Section 6.01(b) of
the Participation Agreement.
Lessor. First Security Bank, National Association, a national
banking association, not in its individual capacity but solely as Owner
Trustee under the Trust Agreement, and its successors and permitted assigns.
Lessor's Estate. All estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Participation Agreement, the Bills of Sale, the Modification Agreement, the
GTA, the Engine Warranty Assignment, the Engine Consent, any Ancillary
Agreement, any warranty with respect to the Airframe and the Engines, all
amounts of Basic Rent, Renewal Rent and Supplemental Rent, including without
limitation, insurance proceeds (other than insurance proceeds payable to or
for the benefit of either the Owner Trustee in its individual capacity or the
Owner Participant) and requisition, indemnity or other payments of any kind
for or with respect to the Aircraft (except amounts owing to the Owner
Participant or to the Owner Trustee in its individual capacity, or to any of
their respective directors, officers, employees and agents pursuant to
Articles 8 and 9 of the Participation Agreement). Notwithstanding the
foregoing, "Lessor's Estate" shall (i) not include any Excepted Payment and
(ii) "Lessor's Estate" shall include all property intended to be subjected to
the Indenture by the Granting Clause thereof.
Lessor's Liens. Liens on the Lessor's Estate or the Trust
Indenture Estate arising as a result of (i) claims against the Lessor, in its
individual capacity or as Owner Trustee, the Owner Participant or any
Affiliate of the Owner Participant, in each case not related to the
transactions contemplated by the Operative Agreements, (ii) acts or omissions
of the Lessor in its individual capacity or as Owner Trustee, and, in the case
of the Lessor in its individual capacity, arising from its gross negligence or
willful misconduct either not related to the transactions contemplated by or
expressly prohibited under the Operative Agreements and any act or omission of
the Owner Participant or any Affiliate of the Owner Participant which is not
related to the transactions contemplated by the Operative Agreements or is in
violation of any of the terms of the Operative Agreements, (iii) Taxes or
Expenses imposed against the Lessor, in its individual capacity or as Owner
Trustee, or the Owner Participant or any Affiliate of the Owner Participant,
the Lessor's Estate or the trust created by the Trust Agreement which are not
required to be indemnified against by the Lessee pursuant to the Tax Indemnity
Agreement or by reason of Section 8.01(b) or 9.01(b) of the Participation
Agreement, or (iv) claims against the Lessor or the Owner Participant arising
from the voluntary transfer by the Lessor or the Owner Participant of its
interests in the Aircraft other than a transfer of the Aircraft pursuant to
Section 4.02(a) or Article 10 or 11 of the Lease and other than a transfer
pursuant to the exercise of the remedies set forth in Article 17 of the Lease.
Lien. Any mortgage, pledge, lien, charge, encumbrance, lease or
security interest or other similar interest.
Loss Payee. Has the meaning specified in Section 13.02(b)(i) of
the Lease.
Majority in Interest of Certificate Holders. As of a particular
date of determination, the Holders of more than 50% of the aggregate unpaid
principal amount of all Certificates outstanding as of such date excluding for
purposes of this definition any Certificates held by (i) the Owner Trustee or
the Owner Participant or any interests of the Owner Participant unless all
Certificates then outstanding shall be held by the Owner Participant, (ii) the
Lessee or (iii) any Affiliate of any thereof.
Make-Whole Premium. An amount determined as of the day before the
applicable Prepayment Date (or date of purchase, as the case may be) which an
Independent Investment Banker determines to be equal to the excess, if any, of
(i) the present values of all remaining scheduled payments of such principal
amount or portion thereof and interest thereon (excluding interest accrued
from the immediately preceding Payment Date to such Prepayment Date or date of
purchase, as the case may be) to the Maturity of such Certificate in
accordance with generally accepted financial practices assuming a 360-day year
consisting of twelve 30-day months at a discount rate equal to the Treasury
Yield, all as determined by the Independent Investment Banker over (ii) the
unpaid principal amount of such Certificate.
Manufacturer. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Corporation, a Maryland
corporation, and its successors and assigns.
Maturity. With respect to any Certificate, the date on which the
final principal amount of such Certificate is scheduled to be due and payable.
Modification Agreement. The Aircraft Modification Agreement dated
as of December 1, 1995 between the Lessee and the Manufacturer providing for
the refurbishing and reconfiguration of the Aircraft including any warranties
relating thereto, as originally executed or as modified, supplemented, amended
or supplemented in accordance with the terms thereof, but only to the extent
that the foregoing relates to the Aircraft, to the extent assigned to the
Owner Trustee pursuant to the Warranty ▇▇▇▇ of Sale.
Moody's. ▇▇▇▇▇'▇ Investors Service, Inc.
Net Present Value of Rents. The net present value, as of the
Delivery Date, of Basic Rent set forth in Schedule II of the Lease, discounted
at a rate per semi-annual period equal to the Debt Rate.
Non-U.S. Person. Any Person other than (i) a citizen or resident
of the United States, as defined in Section 7701(a)(30) of the Code, (ii) a
corporation, partnership or other entity created or organized in or under the
laws of the United States or any political subdivision thereof or therein, or
(iii) any estate or trust that is subject to United States federal income
taxation regardless of the source of its income.
Obsolete Parts. Parts which the Lessee in good faith determines
to be obsolete or no longer suitable or appropriate for use on the Airframe or
any Engine.
Officer's Certificate. When delivered pursuant to the Indenture, a
certificate signed by a Responsible Officer of the Lessee or the Owner
Trustee, as the case may be, and delivered to the Indenture Trustee. Each
such certificate shall include the statements provided for in Section 15.07 of
the Indenture.
Operative Agreements. The Participation Agreement, the Trust
Agreement, the Bills of Sale, the Modification Agreement, the GTA, the Engine
Warranty Assignment, the Lease, the Lease Supplement, the Owner Participant
Guaranty, if any, the Owner Trustee Guaranty, if any, any Ancillary Agreement
entered into by or with the written consent of the Indenture Trustee, which by
its terms is an Operative Agreement, the Certificates outstanding at the time
of reference, the Indenture, the Indenture and Security Agreement Supplement,
the Engine Consent and the Tax Indemnity Agreement, each as amended from time
to time.
Opinion of Counsel. When delivered pursuant to the Indenture, a
written opinion of legal counsel, who in the case of counsel (a) for the
Lessee may be (i) an attorney employed by the Lessee who is generally
empowered to deliver such written opinions, (ii) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ or a
successor firm or (iii) other counsel designated by the Lessee and reasonably
satisfactory to the Indenture Trustee and (b) for the Owner Trustee or the
Indenture Trustee, an attorney selected by such Person and, in the case of the
Owner Trustee, reasonably satisfactory to the Indenture Trustee.
Original Agreements. The documents and instruments delivered on
the Delivery Date in connection with the transactions contemplated by the
Original Participation Agreement.
Original Ancillary Agreement I. The Ancillary Agreement I (Federal
Express Corporation Trust No. N586FE), among the Lessee, the Owner
Participant, the Indenture Trustee and the Owner Trustee as it was originally
executed on the Delivery Date.
Original Indenture. The Trust Indenture, Mortgage and Security
Agreement (Federal Express Corporation Trust No. N586FE), dated as of
September 1, 1996, between the Owner Trustee and the Indenture Trustee, which
together with the Indenture and Security Agreement Supplement No. 1 (Federal
Express Corporation Trust No. N586FE), dated September 23, 1996 attached
thereto was recorded as one instrument by the FAA on September 24, 1996 and
assigned Conveyance Number HH012951.
Original Lease. The Lease Agreement (Federal Express Corporation
Trust No. N586FE), dated as of September 1, 1996, between the Owner Trustee as
lessor, and the Lessee, which together with Lease Supplement No. 1 (Federal
Express Corporation Trust No. N586FE), dated September 23, 1996 attached
thereto was recorded as one instrument by the FAA on September 24, 1996 and
assigned Conveyance Number HH012952.
Original Loan Certificates. The loan certificates issued on the
Delivery Date to the Original Loan Participants.
Original Loan Participants. The entities listed on Schedule I to
the Original Participation Agreement and their successors and assigns (other
than any assignees in connection with the Refunding Date).
Original Participation Agreement. The Participation Agreement
(Federal Express Corporation Trust No. N586FE), dated as of April 1, 1996, as
amended and restated as of September 1, 1996, among the Lessee, the Owner
Participant, the Indenture Trustee, the Owner Trustee and the Original Loan
Participants as it was originally executed on April 19, 1996 and amended and
restated as of September 1, 1996.
Original Tax Indemnity Agreement. The Tax Indemnity Agreement
(Federal Express Corporation Trust No. N586FE), between the Lessee and the
Owner Participant as it was originally executed as of September 1, 1996.
Original Trust Agreement. The Trust Agreement (Federal Express
Corporation Trust No. N586FE), dated as of April 1, 1996, as amended and
restated as of September 1, 1996, between the Owner Participant and the Owner
Trustee as it was originally executed on April 19, 1996 and amended and
restated as of September 1, 1996, and filed with the FAA on September 23, 1996.
Outstanding. When used with respect to Certificates, as of the
date of determination and subject to the provisions of Section 10.04 of the
Indenture, all Certificates theretofore executed and delivered under the
Indenture, with the exception of the following:
(i)Certificates theretofore cancelled by the Indenture Trustee or
delivered to the Indenture Trustee for cancellation pursuant to
Section 2.08 of the Indenture or otherwise;
(ii)Certificates for which prepayment money in the necessary amount
has been theretofore deposited with the Indenture Trustee in trust
for the Holders of such Certificates pursuant to Section 14.01 of
the Indenture; provided, that if such Certificates are to be
prepaid, notice of such prepayment has been duly given pursuant to
the Indenture or provision therefor satisfactory to the Indenture
Trustee has been made; and
(iii)Certificates in exchange for or in lieu of which other
Certificates have been executed and delivered pursuant to Article
II of the Indenture.
Owner Participant. The trustor originally named in the Trust
Agreement and any successor thereto, and any Person to which Owner Participant
transfers, in accordance with the Trust Agreement, its right, title and
interest in and to the Operative Agreements and the Lessor's Estate.
Owner Participant Guarantor. The provider, if any, of an Owner
Participant Guaranty.
Owner Participant Guaranty. Any guaranty delivered in compliance
with Section 7.03(d) of the Participation Agreement.
Owner Trustee. FSB, not in its individual capacity except as
otherwise expressly stated, but solely as Owner Trustee under the Trust
Agreement, and its successors and permitted assigns.
Owner Trustee Guarantor. The provider of an Owner Trustee
Guaranty.
Owner Trustee Guaranty. Any guaranty delivered in compliance with
Section 11.01(b)(ii) of the Participation Agreement.
Owner's Economic Return. The Owner Participant's anticipated net
after-tax yield and aggregate after-tax cash flow during the Interim Term and
the Basic Term, utilizing the multiple investment sinking fund method of
analysis, computed on the basis of the same methodology and assumptions as
were utilized by the Owner Participant in determining Basic Rent, Stipulated
Loss Value and Termination Value percentages and EBO Price, as such
assumptions may be adjusted for events which have been the basis of
adjustments to Rent pursuant to Section 3.04 of the Lease.
Participation Agreement. The Participation Agreement (Federal
Express Corporation Trust No. N586FE), dated as of April 1, 1996, as amended
and restated as of September 1, 1996 and as further amended and restated as of
October 15, 1996, among the Lessee, the Original Loan Participants, the Owner
Trustee not in its individual capacity except as otherwise expressly provided
therein, but solely as owner trustee, the Owner Participant, the Indenture
Trustee not in its individual capacity except as otherwise expressly provided
therein, but solely as indenture trustee and the Pass Through Trustee not in
its individual capacity except as otherwise expressly provided therein, but
solely as pass through trustee, as amended, modified or supplemented, or the
terms thereof waived.
Parts. All appliances, parts, components, instruments,
appurtenances, accessories, furnishings and other equipment of whatever nature
(other than complete Engines or engines) which may from time to time be
incorporated or installed in or attached to the Airframe or any Engine or,
prior to replacement thereof in accordance with the Lease, which may be
removed therefrom.
Pass Through Agreement. The Pass Through Trust Agreement dated as
of June 1, 1996 between the Lessee and the Pass Through Trustee, as such Pass
Through Agreement may be modified, supplemented or amended from time to time in
accordance with the provisions thereof.
Pass Through Certificates. Any of the 1996 Pass Through
Certificates, Series B1 or 1996 Pass Through Certificates, Series B2, in each
case as issued by the related Pass Through Trust; and "Pass Through
Certificates" means both of the Pass Through Certificates issued by each of
the Pass Through Trusts.
Pass Through Closing Date. The Business Day on which the sale of
the Pass Through Certificates to the Underwriters pursuant to the Underwriting
Agreement takes place.
Pass Through Trust. The Federal Express Pass Through Trust,
1996-B1 or Federal Express Pass Through Trust, 1996-B2, in each case formed
pursuant to the related Series Supplement in accordance with the Pass Through
Agreement; and "Pass Through Trusts" means both of such Pass Through Trusts.
Pass Through Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, in its capacity as Pass Through Trustee under the
Pass Through Agreement and each Pass Through Trust, and its successors and
permitted assigns as Pass Through Trustee thereunder.
Past Due Rate. In respect of (A) any amount payable to the Owner
Participant or the Owner Trustee a rate per annum during the period from and
including the due date to but excluding the date on which such amount is paid
in full equal to 2% plus the Debt Rate and (B) any principal of or interest on
any Certificate or any other amount payable under the Indenture, any
Certificate or any other Operative Agreement that is not paid when due
(whether at Maturity, by acceleration, by optional or mandatory prepayment or
otherwise) to any Holder, the Indenture Trustee or the Pass Through Trustee, a
rate per annum during the period from and including the due date to but
excluding the date on which such amount is paid in full equal to (i) in the
case of any such amount payable to the Holder of any Certificate, 2% plus the
interest rate applicable to such Certificate and (ii) in the case of any other
such amount, 2% plus the Debt Rate.
Payment Date. Each January 30 and July 30 commencing on January
30, 1997.
Payment Default. Any event specified in Section 16.01(a) or
16.01(b) of the Lease which with the giving of notice or lapse of time or both
would constitute an Event of Default.
Permitted Investments. Those investments enumerated in Section
23.01(a) (i), (ii), (iii) and (iv) of the Lease.
Person. Any individual, sole proprietorship, partnership, joint
venture, joint stock company, trust, unincorporated organization, association,
corporation, institution, entity or government (federal, state, local, foreign
or any agency, instrumentality, division or body thereof).
Preliminary Notice. Has the meaning specified in Section 4.01(a)
of the Lease.
Premium Termination Date. With respect to the Certificates having
a Maturity in 2013, October 23, 2006 and with respect to the Certificates
having a Maturity in 2015, June 23, 2016.
Prepayment Date. Has the meaning specified in Section 6.02(b) of
the Indenture.
Prepayment Price. Has the meaning specified in Section 6.02(b) of
the Indenture.
Property. Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
Proposed Termination Date. Has the meaning specified in Section
10.01(a) of the Lease.
Purchase Price. The amount specified as such in Ancillary
Agreement II.
Record Date. With respect to Payment Dates under the Indenture
(except a date for payment of defaulted interest), January 15 for January 30
Payment Dates and July 15 for July 30 Payment Dates, whether or not such date
is a Business Day.
Recourse Amount. Has the meaning specified in Section 17.10 of the
Participation Agreement.
Refinancing. A non-recourse loan to the Lessor arranged pursuant
to Section 15.01 of the Participation Agreement.
Refunding Date. A Business Day on which the refunding of the
Original Loan Certificates occurs, the expected date thereof having been
specified by the Lessee in a written notice given to the parties to the
Participation Agreement and the Underwriters at least three (3) Business Days
prior to such expected Refunding Date.
Register. Has the meaning set forth in Section 3.02 of the
Indenture.
Registrar. Has the meaning set forth in Section 3.02 of the
Indenture.
Remaining Weighted Average Life. For any Certificate, as of any
determination date, the number of years obtained by dividing (a) the sum of the
products obtained by multiplying (i) the amount of each then remaining
mandatory sinking fund redemption payment of principal, including the payment
due on the Maturity of such Certificate, by (ii) the number of years
(calculated to the nearest one-twelfth) which will elapse between such
determination date, and the date on which such payment is scheduled to be
made, by (b) the then outstanding principal amount of such Certificate.
Renewal Rent. The amount payable by the Lessee as rent in
accordance with Section 4.01 of the Lease during any Renewal Term.
Renewal Term. Any Fixed Renewal Term or Fair Market Renewal Term
with respect to which the Lessee has exercised its option to renew the Lease
pursuant to Section 4.01(a) thereof.
Rent. All payments due from the Lessee under the Lease as Basic
Rent, Renewal Rent and Supplemental Rent, collectively.
Rent Payment Date. Each January 30 and July 30 commencing on
January 30, 1997, and continuing thereafter during the Term.
Reoptimization Date. Has the meaning specified in Section
15.02(a) of the Participation Agreement.
Replacement Aircraft. Any aircraft substituted for the Aircraft
pursuant to Section 11.03(a) of the Lease.
Replacement Airframe. Has the meaning set forth in Section 11.03
of the Lease.
Replacement Engine. A General Electric CF6-80C2-D1F engine (or an
engine of the same or another manufacturer) of equal or greater value,
remaining useful life and utility as the Engine being replaced, together with
all Parts relating to such engine; provided, however, that if such replacement
engine is not a General Electric CF6-80C2-D1F engine, such replacement engine
must then be commonly used in the commercial aviation industry on ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ MD-11 airframes.
Responsible Officer. With respect to the Owner Trustee (except for
purposes of the Trust Agreement in which case the definition of Responsible
Officer set forth in Section 3.10 of the Trust Agreement is applicable) or the
Indenture Trustee, any officer in its Corporate Trust Administration, as the
case may be, designated by such Person to perform obligations under the
Operative Agreements, and with respect to any other party, any corporate
officer or (except in the case of the Owner Participant) other employee of a
party who, in the normal performance of his or her operational
responsibilities, with respect to the subject matter of any covenant,
agreement or obligation of such party pursuant to any Operative Agreement,
would have responsibility for and knowledge of such matter and the
requirements of any Operative Agreement with respect thereto.
S&P. Standard & Poor's Ratings Group.
SEC. The Securities and Exchange Commission of the United States
and any successor agencies or authorities.
SSB. State Street Bank and Trust Company, a Massachusetts trust
company.
Securities Act. The Securities Act of 1933, as amended.
Series Supplement. The Series Supplement 1996-B1 to be executed
and delivered by the Lessee and the Pass Through Trustee or the Series
Supplement 1996-B2 to be executed and delivered by the Lessee and the Pass
Through Trustee, in each case as such Series Supplement may be modified,
supplemented or amended from time to time in accordance with the provisions
thereof and "Series Supplements" means both such Series Supplements.
Sinking Fund Redemption Date. Has the meaning specified in Section
6.06 of the Indenture.
Sinking Fund Redemption Price. Has the meaning specified in
Section 6.06 of the Indenture.
Special Aviation Counsel. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇.
Stipulated Loss Value. As of any Stipulated Loss Value
Determination Date during the Basic Term, the amount determined by multiplying
the Purchase Price by the percentage set forth in Schedule III of the Lease
under the heading "Stipulated Loss Value Factor" opposite such date (as such
Schedule III may be adjusted from time to time as provided in Section 3.04 of
the Lease), and during any Renewal Term, the amount determined pursuant to
Section 4.01(b) of the Lease. Notwithstanding any other provisions of the
Lease or the Participation Agreement or the Indenture, each Stipulated Loss
Value for the Aircraft shall be, under any circumstances and in any event, an
amount, together with so much of the arrears portion of Basic Rent due and
owing through the date of payment of Stipulated Loss Value as does not
constitute an Excepted Payment, at least sufficient to pay in full as of such
date of payment the aggregate unpaid principal amount of and accrued interest
on the Certificates outstanding on such date of payment. Subject to the
immediately preceding sentence, it is understood and agreed that the amounts
set forth on Schedule III of the Lease, for dates other than Rent Payment
Dates on which arrears Basic Rent is due, fully reflect appropriate Basic Rent
accruals and credits of unearned Basic Rent and, accordingly, no further
accrual or credit shall be required whenever Stipulated Loss Value is to be
calculated with reference to any such date.
Stipulated Loss Value Determination Date. Each date set forth on
Schedule III of the Lease under the heading "Stipulated Loss Value Factors."
Supplemental Rent. All amounts, liabilities and obligations which
the Lessee assumes or agrees to perform or pay under the Lease or under the
Participation Agreement or Tax Indemnity Agreement or any Ancillary Agreement
or any other Operative Agreement to FSB, the Lessor, the Owner Participant,
the Indenture Trustee or others, including, without limitation, payments of
Stipulated Loss Value, EBO Price and amounts calculated by reference to
Termination Value, and all amounts required to be paid by Lessee under the
agreements, covenants and indemnities contained in the Lease or in the
Participation Agreement or the Tax Indemnity Agreement or any other Operative
Agreement, but excluding Basic Rent.
Tax. Has the meaning set forth in Section 8.01(a) of the
Participation Agreement.
Tax Indemnity Agreement. The Original Tax Indemnity Agreement as
amended by Amendment No. 1 to the Original Tax Indemnity Agreement, as from
time to time modified, amended or supplemented pursuant to its applicable
provisions.
Term. The Interim Term, the Basic Term and any Renewal Term unless
the Lease is terminated earlier pursuant to its terms.
Termination Date. A Rent Payment Date during the Basic Term that
is on or after the seventh anniversary of the Commencement Date in the case of
Article 10 of the Lease, and in the case of (i) Section 4.02(a)(A) of the
Lease, July 30, 2013, (ii) Section 4.02(a)(D) or (E) of the Lease, a Rent
Payment Date that is on or after the seventh anniversary of the Commencement
Date and (iii) Section 4.02(a)(F) of the Lease, July 30, 2011.
Termination Value. As of any Termination Date, the amount
determined by multiplying the Purchase Price by the percentage set forth in
Schedule IV of the Lease under the heading "Termination Value Factor" opposite
such Termination Date (as such Schedule IV may be adjusted from time to time
as provided in Section 3.04 of the Lease). Notwithstanding any other
provisions of the Lease, the Participation Agreement or the Indenture, each
Termination Value shall be, under any circumstances and in any event, an
amount, together with so much of the arrears portion of Basic Rent due and
owing through the date of payment of any amount calculated by reference to
Termination Value as does not constitute an Excepted Payment, at least
sufficient to pay in full as of such date of payment the aggregate unpaid
principal amount of and accrued interest on the Certificates outstanding on
such date of payment. Subject to the immediately preceding sentence, it is
understood and agreed that the amounts set forth on Schedule IV of the Lease,
for dates other than Rent Payment Dates on which arrears Basic Rent is due,
fully reflect appropriate Basic Rent accruals and credits of unearned Basic
Rent and, accordingly, no further accrual or credit shall be required whenever
Termination Value is to be calculated with reference to any such date.
Transaction Costs. Those costs and expenses set forth in Section
10.01(a) of the Participation Agreement.
Transportation Code. Title 49 of the United States Code, as
amended and in effect on the date of the Lease or as subsequently amended, or
any successor or substituted legislation at the time in effect and applicable,
and the regulations promulgated pursuant thereto.
Treasury Yield. (i) In the case of a Certificate having a
Maturity within one year after the Prepayment Date the average yield to
maturity on a government bond equivalent basis of the applicable United States
Treasury ▇▇▇▇ due the week of Maturity of such Certificate and (ii) in the
case of a Certificate having a Maturity one year or more after the Prepayment
Date, the average yield of the most actively traded United States Treasury
Note (as reported by Cantor ▇▇▇▇▇▇▇▇▇▇ Securities Corp. on page 5 of Telerate
Systems, Inc., a financial news service, or if such report is not available,
a source deemed comparable by the Independent Investment Banker selected to
determine the Make-Whole Premium and reasonably acceptable to the Lessee)
corresponding in maturity to the Remaining Weighted Average Life of such
Certificate (or, if there is no corresponding maturity, an interpolation of
maturities by the Independent Investment Banker), in each case determined by
the Independent Investment Banker selected to determine the Make-Whole Premium
based on the average of the yields to stated maturity determined from the bid
prices as of 10:00 a.m. and 2:00 p.m. New York time, on the second Business
Day preceding the Prepayment Date.
Trust Agreement. The Trust Agreement (Federal Express Corporation
Trust No. N586FE), dated as of April 1, 1996, as amended and restated as of
September 1, 1996 and as further amended and restated as of October 15, 1996,
between the Owner Participant and the Owner Trustee in its individual
capacity, as from time to time modified, amended or supplemented pursuant to
its applicable provisions and in accordance with the Operative Agreements.
Trust Estate. The Lessor's Estate.
Trust Indenture Act. The Trust Indenture Act of 1939, as amended.
Trust Indenture Estate. All estate, right, title and interest of
the Indenture Trustee in and to any of the property, rights, interests and
privileges granted to the Indenture Trustee pursuant to the Granting Clause of
the Indenture, other than Excepted Payments and any and all other rights of
the Owner Trustee or the Owner Participant expressly reserved to the Owner
Trustee or the Owner Participant pursuant to the Indenture.
Underwriters. ▇▇▇▇▇▇▇, Sachs & Co., ▇.▇. ▇▇▇▇▇▇ Securities Inc.,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, BA Securities, Inc. and First Chicago
Capital Markets, Inc.
Underwriting Agreement. The Underwriting Agreement dated October
17, 1996 among the Lessee and the Underwriters.
United States, U.S. or US. The United States of America.
U.S. Air Carrier. Any United States air carrier as to which there
is in force a certificate issued pursuant to Section 41102(a) or Section 41103
of the Transportation Code, and as to which there is in force an air carrier
operating certificate issued pursuant to Chapter 447 of the Transportation
Code and Part 121 of the regulations under such Transportation Code, for
aircraft capable of carrying ten (10) or more individuals or 6,000 pounds or
more of cargo, or which may operate as an air carrier by certification or
otherwise under any successor or substitute provision thereof or in absence
thereof.
U.S. Person. A Person described in Section 7701(a)(30) of the
Code.
Warranty ▇▇▇▇ of Sale. The full warranty ▇▇▇▇ of sale covering
the Aircraft (and specifically referring to each Engine) executed by the
Lessee, as seller in favor of the Owner Trustee, as buyer, and dated the
Delivery Date.
SCHEDULE III
PERMITTED COUNTRY LIST
Australia Japan
Austria Luxembourg
Belgium Mexico
Canada Netherlands
Denmark New Zealand
Finland Norway
France Philippines
Germany Singapore
Iceland Sweden
Ireland Switzerland
United Kingdom
EXHIBIT A(1)(a)
[Letterhead of Federal Express]
[Refunding Date]
To the Addressees Listed on Schedule A Attached
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
I am the Vice President - Law of Federal Express Corporation, a
Delaware corporation ("Federal"), and am familiar with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N586FE), dated as of April 1, 1996, as amended and restated as of
September 1, 1996 and as further amended and restated as of October 15, 1996
(the "Participation Agreement"), among Federal, as Lessee, Ameritech Credit
Corporation, as Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company of New York,
Bank of America National Trust & Savings Association, The Chase Manhattan
Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South), as
Original Loan Participants, First Security Bank, National Association, a
national banking association, not in its individual capacity, except as
otherwise stated, but solely as Owner Trustee under the Trust Agreement, State
Street Bank and Trust Company, a Massachusetts trust company, not in its
individual capacity, except as otherwise stated, but solely as Indenture
Trustee under the Indenture and State Street Bank and Trust Company, as Pass
Through Trustee, relating to the Aircraft. This opinion is being delivered
pursuant to Section 4.01(l)(i) of the Participation Agreement. Capitalized
terms not otherwise defined herein have the meaning assigned thereto in the
Participation Agreement.
The Participation Agreement provides, among other things, for the
refinancing in full of the Original Loan Certificates evidencing the Original
Loan Participants' participation in the payment of the Purchase Price of one
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MD-11F aircraft (the "Aircraft"), using the proceeds from
the public offering of the Pass Through Certificates. Two Series of Pass
Through Certificates will be issued by two Pass Through Trusts formed to
acquire, among other securities, the Certificates bearing a particular
interest rate and having a particular Maturity that will be issued under the
Trust Indenture and Security Agreement (Federal Express Corporation Trust No.
N586FE) dated as of September 1, 1996, as amended and restated as of October
15, 1996, as supplemented by the related Indenture and Security Agreement
Supplement ("Indenture"), between the Owner Trustee and the Indenture Trustee.
In connection with the opinions expressed below, I have examined or
caused to be examined by attorneys under my supervision, executed counterparts
of the Operative Agreements, the Pass Through Agreement and each Series
Supplement (the "Transaction Agreements"). We have relied upon originals or
copies, certified or otherwise identified to our satisfaction, of such
corporate records, documents and other instruments as in our judgment are
relevant to rendering the opinions expressed below. As to any facts material
to the opinions expressed below (other than any thereof relating to Federal),
we have relied upon the representations and warranties made in the Transaction
Agreements, the accuracy of which we have not independently investigated or
verified. In such examination, we have assumed the genuineness of all
signatures (other than the signatures of Federal) and the authenticity of all
documents submitted to us as originals and the conformity with the originals of
all documents submitted to us as copies. We have also assumed that each of the
parties to each of the Transaction Agreements, other than Federal, has full
power, authority and legal right to enter into such Transaction Agreements and
that each such Transaction Agreement has been duly authorized, executed and
delivered by each of such parties.
Based on the foregoing, it is my opinion that:
1. Federal is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has or had, on the date of execution thereof, the
corporate power and authority to carry on its business as currently conducted
and to enter into and perform its obligations under the Transaction Agreements
to which it is a party. Federal is duly qualified to do business and is in
good standing in the State of Tennessee and each other state of the United
States in which its operations or the nature of its business requires Federal
to so qualify, except where the failure to so qualify would not have a
material adverse impact on Federal or its business.
2. Federal possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents which are material to
the operation of the routes flown by it and the conduct of its business and
operations as currently conducted, and each such certificate, franchise,
license, permit, right and concession and consent is in full force and effect.
3. Each of the Transaction Agreements to which Federal is a party
has or had, on the date of execution thereof, been duly authorized, executed
and delivered by Federal and each constitutes the legal, valid and binding
obligation of Federal enforceable against Federal in accordance with its terms.
4. Neither the execution and delivery by Federal of the Transaction
Agreements to which Federal is a party, nor the consummation of any of the
transactions by Federal contemplated thereby, nor the performance of the
obligations thereunder by Federal, did at the time of execution and delivery,
or does presently (a) require any stockholder approval or violate the
Certificate of Incorporation or By-laws of Federal or (b) conflict with or
contravene the provisions of, or constitute a default under, or result in the
creation of any Lien (other than Liens permitted under Section 6.01(a) of the
Lease) upon the property of Federal under any law, governmental rule or
regulation, or the charter or bylaws of Federal or any order, writ, injunction
or decree of any court or governmental authority against Federal or by which
any of its properties may be bound or any indenture, mortgage, contract or
other agreement known to me to which Federal is a party or by which it may be
bound or, require the approval or consent of any trustee or the holders of any
indebtedness or obligations of Federal.
5. Neither the execution and delivery by Federal of the Transaction
Agreements to which it is a party, nor the consummation of any transactions by
Federal contemplated thereby, nor the performance of the obligations
thereunder by Federal, did or does, as the case may be, (a) require the
consent or approval of, the giving of notice to, or (except as described or
contemplated in the Participation Agreement and the Lease, all of which are
required to be performed on or prior to the Refunding Date and which shall
have been accomplished on or prior to the Refunding Date) the registration
with, or the taking of any other action in respect of, the Aeronautics
Authority, the Securities and Exchange Commission or any other authority or
agency of the federal government or of the State of Tennessee other than (i)
the registration of the issuance and sale of the Pass Through Certificates
under the Securities Act, (ii) compliance with the securities laws of each
applicable state, and (iii) the filing of the Indenture, the Lease and the
Trust Agreement with the FAA, or (b) contravene any judgment or order
applicable to or binding on Federal or any law or governmental rule or
regulation of the United States or of the State of Tennessee.
6. There is no pending, or to my knowledge, threatened action or
proceeding before any court or administrative agency which individually (or in
the aggregate in the case of any group of related lawsuits) (i) is expected to
have a material adverse effect on (A) except for the matters described under
"Legal Proceedings" in Federal's Annual Report on Form 10-K for the fiscal
year ended May 31, 1996 (as updated by Note 7 to the financial statements
included in Federal's Quarterly Report on Form 10-Q for the fiscal quarter
ended August 31, 1996) and in Federal's Current Reports on Form 8-K dated June
7, 1996 and August 16, 1996, as to which I can express no opinion at this time
concerning Federal's liability (if any) or the effect of any adverse
determination upon the business, condition (financial or otherwise) or
operations of Federal, the financial condition of Federal or (B) the ability
of Federal to perform its obligations under the Transaction Agreements, or
(ii) involves the Aircraft.
7. Except for the filing and, where appropriate, recording,
pursuant to the Transportation Code of the Lease, the Indenture, the Trust
Agreement, the filing of the financing statements referred to in Section
4.01(f) of the Participation Agreement and the taking of possession by the
Indenture Trustee of the original counterpart of the Lease and maintaining
possession of the original counterpart of the Lease Supplement delivered on
the Delivery Date, no further action, including any filing or recording of any
document is necessary or advisable in order to establish and perfect the Owner
Trustee's title to and interest in the Aircraft as against Federal and any
third parties, or to perfect the first mortgage lien on the Aircraft in favor
of the Indenture Trustee in each case with respect to such portion of the
Aircraft as is covered by the recording system established by the
Transportation Code.
8. Federal is a duly certificated "air carrier" within the meaning
of the Transportation Code, and a holder of a certificate under Sections
41102(a) and 41103 of the Transportation Code, and an "air carrier operating
certificate" issued under Chapter 447 of the Transportation Code for aircraft
capable of carrying ten (10) or more individuals or 6,000 pounds or more of
cargo, and each such certificate is in full force and effect.
9. On the Delivery Date the Owner Trustee received good and valid
title to the Aircraft free and clear of all Liens on file with the FAA, except
for Liens permitted under Section 6.01(a) of the Lease. Pursuant to the
Original Participation Agreement the Aircraft was duly delivered to the Owner
Trustee. Federal, as Lessee, duly accepted the Aircraft under the Original
Lease and the Lease Supplement and the Term commenced on the Delivery Date.
10. Federal's principal place of business and chief executive
office (as such term is defined in the Uniform Commercial Code in effect in
the State of Tennessee) are located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇.
11. Federal is not, and is not directly or indirectly controlled by
or acting on behalf of any Person which is, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
The opinions expressed in paragraph 3 above as to the enforceability
of the Transaction Agreements to which Federal is a party are based upon the
assumption for purposes of such opinions and without independent analysis
that, notwithstanding the respective choice of laws clauses in the Transaction
Agreements, the governing law with respect to each of the Transaction
Agreements is identical in all relevant respects to the law of the State of
Tennessee. Insofar as the foregoing opinion relates to the enforceability of
any instrument, such enforceability is subject to applicable bankruptcy,
insolvency and other similar laws affecting the enforcement of creditors'
rights generally (whether such enforceability is considered in a proceeding in
equity or at law). The enforceability of the remedies provided under the
Lease may also be limited by applicable laws which may affect the remedies
provided therein but which do not in my opinion affect the validity of the
Lease or make such remedies inadequate for the practical realization of the
benefits intended to be provided thereby.
I do not express any opinion as to matters governed by any law other
than the Federal laws of the United States of America, the corporation law of
the State of Delaware and the laws of the State of Tennessee.
As to the matters referred to in paragraphs 5, 7 and 9, I have relied
on the opinion of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ of even date herewith, to the
extent such matters are addressed in such counsel's opinion and subject to the
assumptions and qualifications expressed therein.
This opinion is delivered to you solely for your use in connection
with the transaction described herein, and may not be used for any other
purpose, and may not be relied upon by any other person, without my prior
written consent.
I rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. I hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
SCHEDULE A
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(1)(b)
[Letterhead of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Parties named on Schedule A Hereto
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
We have acted as special counsel for Federal Express Corporation, a
Delaware corporation ("Federal Express"), in connection with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N586FE), dated as of April 1, 1996, as amended and restated as of
September 1, 1996 and as further amended and restated as of October 15, 1996
(the "Participation Agreement"), among Federal Express, as Lessee, Ameritech
Credit Corporation, as Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company of New
York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as the Original Loan Participants, First Security Bank, National Association,
not in its individual capacity but solely as Owner Trustee under the Trust
Agreement, State Street Bank and Trust Company, not in its individual
capacity, except as otherwise stated, but solely as Indenture Trustee under
the Indenture, and State Street Bank and Trust Company, as Pass Through
Trustee, relating to the Aircraft. This opinion is being delivered pursuant
to Section 4.01(l)(viii) of the Participation Agreement. Capitalized terms
not otherwise defined herein have the meanings assigned thereto in the
Participation Agreement.
Pursuant to the Original Participation Agreement, the Owner
Participant and the Original Loan Participants participated in the payment of
the Purchase Price of one ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MD-11F Aircraft which was
purchased by the Owner Trustee pursuant to the Bills of Sale, subjected to the
Lien of the Original Indenture and leased to Federal Express under the
Original Lease. The Participation Agreement provides, among other things, for
the refinancing of the Original Loan Certificates using the proceeds from the
public offering of the Pass Through Certificates. Two Series of Pass Through
Certificates will be issued by separate Pass Through Trusts, each formed to
acquire, among other securities, the Certificates bearing a particular
interest rate and having a particular Maturity that will be issued under the
Indenture.
In connection with the opinions expressed below, we have examined
executed counterparts of the Operative Agreements, the Pass Through
Certificates, the Pass Through Agreement and each Series Supplement (the
"Transaction Agreements"). We have also examined originals, or copies
certified to our satisfaction, of such other agreements, documents,
certificates and statements of governmental officials and corporate officers
as we have deemed necessary or advisable as a basis for such opinions. In
such examination, we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
As to any facts material to our opinions expressed below, we have,
with your consent, relied on the representations and warranties made in or
pursuant to the Participation Agreement and the other documents referred to
therein, the accuracy of which we have not independently verified. In
addition, we have, when relevant facts were not independently established by
us, relied, to the extent we deemed such reliance proper, upon certificates of
public officials and certificates, telegrams and other written or telephoned
statements of officers of the parties referred to herein.
Based on the foregoing, it is our opinion that:
1. With respect to that portion, if any, of the Aircraft and the
other property included in the Lessor's Estate as may not be covered by the
recording system established by the FAA pursuant to Section 44107 of the
Transportation Code, no filing or recording of any document or other action
was or is necessary in order to establish the Owner Trustee's title thereto
and interest therein as against Federal Express and any third parties.
2. The Lease creates a valid leasehold interest in the Aircraft,
the entitlement thereof to the benefits of recordation under the
Transportation Code being subject to the due and timely filing and, where
appropriate, recording of (A) the Lease (with the Indenture attached as an
exhibit), (B) the Indenture and (C) the Trust Agreement.
3. Assuming (i) the due authorization, execution and delivery of
the Transaction Agreements by each of the parties to each such document (other
than Federal Express), (ii) each such party has full power and legal right to
enter into and perform its respective obligations under the Transaction
Agreements, (iii) that the execution, delivery and performance by each of the
Transaction Agreements by each of the parties thereto will not violate the
respective parties' constituent documents, (iv) the due authorization,
execution, issuance and delivery by the Owner Trustee, and the due
authentication by the Indenture Trustee, of the Certificates to be issued
under the Indenture in accordance with the terms of the Indenture, (v) that
the Original Loan Certificates are delivered by the Original Loan Participants
to the Indenture Trustee for cancellation and are cancelled, (vi) the due
authorization, execution, issuance, delivery and authentication by the Pass
Through Trustee of the Pass Through Certificates to be issued under the Pass
Through Agreement and the Series Supplement relating to such Pass Through
Certificates, in each case in accordance with the terms of the Pass Through
Agreement and such Series Supplement, and (vii) that the form of each
Transaction Agreement is in compliance with all applicable laws and
governmental rules and regulations (other than the laws of the United States
and the State of New York), then: (A) to the extent governed by New York law,
each Transaction Agreement in form constitutes a legal, valid and binding
agreement of each party thereto enforceable against each such party in
accordance with its terms; (B) the Original Indenture created, and the
Indenture creates, for the benefit of the Holders, the security interest in
the Trust Indenture Estate that they purport to create; (C) the Certificates,
when issued to and acquired by the Pass Through Trustee, will be legal, valid
and binding obligations of the Owner Trustee enforceable against the Owner
Trustee in accordance with their terms and the terms of the Indenture and will
be entitled to the benefits of the Indenture, including the benefit of the
security interest created thereby; (D) the Pass Through Certificates, when
issued to and acquired by the Underwriters in accordance with the Underwriting
Agreement, will be legal, valid and binding obligations of the Pass Through
Trustee enforceable against the Pass Through Trustee in accordance with their
terms and will be entitled to the benefits of the Pass Through Agreement and
the Series Supplement relating thereto; and (E) the beneficial interest of the
Owner Participant under the Trust Agreement in and to the properties which are
part of the Trust Indenture Estate is subject, to the extent provided in the
Indenture, to the Lien of the Indenture in favor of the Holders. The opinions
set forth in this paragraph 3 are subject to the due filing and, where
appropriate, recording with the FAA of the documents referred to in paragraph
2 above.
4. (a) Each of the Transaction Agreements to which Federal Express
is a party has been duly authorized, executed and delivered by Federal Express.
(b) The execution, delivery and performance by Federal Express of
each of the Transaction Agreements to which Federal Express is a party do not,
or did not on the date of execution thereof, violate, and fully comply, or did
fully comply on the date of execution thereof, with, any laws and governmental
rules and regulations of the State of New York that may be applicable to
Federal Express. The opinion set forth in this paragraph 4(b) is rendered
without regard to the taking of any action or the conduct of any other
business by Federal Express in the State of New York other than the
transactions contemplated by the Transaction Agreements.
5. The execution, delivery and performance of the Participation
Agreement, the Trust Agreement, the Indenture and the Lease by the Owner
Trustee in its individual or trust capacity, as the case may be, and the
issuance, execution, delivery and performance of the Certificates by the Owner
Trustee in its trust capacity do not violate, and fully comply with, any laws
and governmental rules and regulations of the State of New York that may be
applicable to the Owner Trustee in its individual or trust capacity, as the
case may be. The opinion set forth in this paragraph 5 is rendered without
regard to the effect, if any, on such issuance (in the case of the
Certificates), execution, delivery or performance, of the taking of any
action, the conduct of any business or the exercise of any other powers by
First Security Bank, National Association in its individual or trust capacity
in the State of New York not related to the transactions contemplated by the
Transaction Agreements. We have assumed that First Security Bank, National
Association has made the filings necessary to comply with Section 131.3 of the
Banking Law of the State of New York, however we express no opinion as to
whether First Security Bank, National Association is required to comply with
said Section 131.3.
6. All the properties which are part of the Trust Indenture Estate
(including all right, title and interest of the Owner Trustee pledged and
mortgaged by it pursuant to the Indenture in and to the Aircraft and the
Lease) have been pledged and mortgaged with the Indenture Trustee as part of
the Trust Indenture Estate (subject to the due filing and, where appropriate,
recording of those documents referred to in paragraph 2 above and the
financing statements referred to in Section 4.01(f) of the Participation
Agreement), and the beneficial interest of the Owner Participant under the
Trust Agreement in and to such properties are subject, to the extent provided
in the Indenture, to the Lien of the Indenture in favor of the Holders of the
Certificates issued and to be issued under the Indenture.
7. The Indenture creates, as security for the Certificates duly
issued and to be issued under the Indenture, the first priority security
interest in the Aircraft it purports to create, the perfection and rank
thereof being subject to the registration with the FAA of the Aircraft in the
name of the Owner Trustee and the due filing and, where appropriate, recording
in accordance with the Transportation Code of the documents referred to in
paragraph 2 above. We express no opinion with respect to the status of any
security interest in any portion of the Aircraft which does not constitute an
"aircraft" or "aircraft engine", as defined in paragraphs (6) and (7) of
Section 40102(a) of the Transportation Code.
8. Federal Express's participation in the transactions
contemplated by the Transaction Agreements does not and will not constitute a
violation of Section 7 of the Securities Exchange Act of 1934.
9. Except for the filings and recordings referred to in paragraph
2 above, neither the execution and delivery by Federal Express of the
Participation Agreement or any other Operative Agreement to which it is a
party, nor the consummation of any of the transactions by Federal Express
contemplated thereby, requires the consent or approval of, the giving of
notice to, or the registration with, or the taking of any other action in
respect of, the Department of Transportation, the FAA, the Securities and
Exchange Commission or any other Federal or New York State governmental
authority.
10. It is not necessary, in connection with the creation of the
beneficial interest of the Owner Participant in the Trust Indenture Estate
under the circumstances contemplated by the Participation Agreement to
register such beneficial interest under the Securities Act of 1933, as
amended, or to qualify the Trust Agreement under the Trust Indenture Act of
1939, as amended.
11. The provisions of Section 1110 of the United States Bankruptcy
Code will apply to the Aircraft for the benefit of the Lessor, as lessor under
and by reason of the Lease. The Lease, including the rights under Section
1110 of the United States Bankruptcy Code, has been assigned to the Indenture
Trustee pursuant to the Indenture as part of the collateral for the
Certificates and, as assignee, the Indenture Trustee has the benefit of
Section 1110.
The foregoing opinions are subject to the following qualifications:
(a) We have relied, with your consent, without independent
investigation and verification and subject to the assumptions and
qualifications contained therein, upon the opinions of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Law of Federal Express to be
delivered to you and dated the date hereof, for purposes of the matters
covered thereby.
(b) We are qualified to practice law in the State of New York, and
we do not purport to be experts on, or to express any opinion herein
concerning, any laws other than the laws of the State of New York, the laws
of the United States and the General Corporation Law of the State of
Delaware. We express no opinion as to any matters involving aviation law.
(c) The opinion contained in paragraph 3(A) above as to
enforceability is subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity which may
affect the remedies provided in the agreements referred to in said
opinions, which laws and principles, however, do not in our opinion make
the remedies provided in said agreements inadequate for the practical
realization of the benefits of the security intended to be provided thereby.
(d) This opinion is rendered solely to you at Federal Express's
request in connection with the above matter. This opinion may not be
relied upon by you for any other purpose or relied upon by any other Person
without our prior written consent.
(e) We rendered an opinion dated September 23, 1996 (the "Delivery
Date Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent
and agree that the addressees hereto who were not addressees to the
Delivery Date Opinion may rely on the Delivery Date Opinion as fully and
with the same force and effect as if such addressees were originally named
therein on the date of the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(2)(a)
[Letterhead of Winston & ▇▇▇▇▇▇]
[Refunding Date]
To Each of the Addressees Listed in Schedule A Attached Hereto
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
We have acted as special counsel for Ameritech Credit Corporation, a
Delaware corporation (the "Owner Participant"), in connection with the
transactions contemplated by (a) the Participation Agreement (Federal Express
Corporation Trust No. N586FE), dated as of April 1, 1996, as amended and
restated as of September 1, 1996, as further amended and restated as of
October 15, 1996 (the "Participation Agreement"), among Federal Express
Corporation, as Lessee (the "Lessee"), the Owner Participant, ▇▇▇▇▇▇ Guaranty
Trust Company of New York, Bank of America National Trust and Savings
Association, The Chase Manhattan Bank, Commerzbank AG, Atlanta Agency and
NationsBank, N.A. (South), as the Original Loan Participants (the "Original
Loan Participants"), First Security Bank, National Association, not in its
individual capacity, except as otherwise expressly set forth therein, but
solely as Owner Trustee (the "Owner Trustee") and State Street Bank and Trust
Company, as Indenture Trustee (the "Indenture Trustee") and State Street Bank
and Trust Company, as Pass Through Trustee (the "Pass Through Trustee"), (b)
the Trust Agreement (Federal Express Corporation Trust No. N586FE), dated as
of April 1, 1996, as amended and restated as of September 1, 1996, as
further amended and restated as of October 15, 1996 (the "Trust Agreement")
between the Owner Participant and the Owner Trustee, (c) the Tax Indemnity
Agreement (Federal Express Corporation Trust No. N586FE), dated as of
September 1, 1996, as amended by Amendment No. 1 to the Tax Indemnity
Agreement dated as of October 15, 1996 (the "Indemnity Agreement"), between
the Owner Participant and the Lessee, (d) the Ancillary Agreement I
(Federal Express Corporation Trust No. N586FE), dated September 23, 1996,
as amended and restated on the date hereof (the "Ancillary Agreement I")
among the Lessee, the Owner Participant, the Owner Trustee, and the
Indenture Trustee, and (e) the Ancillary Agreement II (Federal Express
Corporation Trust No. N586FE), dated the date hereof (the "Ancillary
Agreement II"), among the Lessee, the Owner Participant, the Owner Trustee
and the Indenture Trustee. This opinion is delivered pursuant to Section
4.01(l)(ii) of the Participation Agreement. Unless otherwise defined
herein, all capitalized terms used herein shall have the respective defined
meanings set forth in the Participation Agreement.
In connection with our opinions herein, we have examined executed
counterparts of the Participation Agreement, the Trust Agreement, the
Indenture, the Indemnity Agreement, Ancillary Agreement I and Ancillary
Agreement II (collectively, the "Documents"). We have further examined and
relied upon the accuracy of original, certified, conformed, photographic or
telecopied copies of such records, agreements, certificates and other
documents as we have deemed necessary or appropriate to enable us to render
the opinions expressed herein. In all such examinations, we have assumed the
genuineness of signatures on original documents and the conformity to such
original documents of all copies submitted to us as certified, conformed,
photographic or telecopied copies, and as to certificates and telegraphic and
telephonic confirmations given by public officials, we have assumed the same
to have been properly given and to be accurate. As to various questions of
fact material to our opinions, we have relied solely upon the accuracy of the
statements, representations and warranties made in the Documents, and we have
made no independent investigation or inquiry with respect to such factual
matters.
With your consent, and for purposes of this opinion, we have assumed
the accuracy of the following matters, but we have not made any independent
investigation or inquiry with respect thereto and we render no opinion on such
matters:
(a) The Participation Agreement, the Indemnity Agreement, the Trust
Agreement, Ancillary Agreement I and Ancillary Agreement II, at the time of
execution and delivery by the Owner Participant will have been duly and
validly executed and delivered by all parties thereto other than the Owner
Participant and will constitute the legal, valid and binding obligations of
such parties, enforceable against such parties in accordance with their
terms, except as the enforceability thereof may be limited by (i)
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).
(b) The parties to the Participation Agreement, the Indemnity
Agreement, the Trust Agreement, Ancillary Agreement I and Ancillary
Agreement II other than the Owner Participant, at the time of execution and
delivery by the Owner Participant, have obtained, and there are in full
force and effect at such time, any and all required consents, permits,
and approvals required by or from any and all federal, state, local or
foreign governmental agencies and authorities in connection with the
transactions contemplated thereby, to the extent necessary for the
legality, validity, binding effect or enforceability of the
Participation Agreement, the Indemnity Agreement, the Trust Agreement,
Ancillary Agreement I or Ancillary Agreement II.
We have been retained as special counsel to the Owner Participant in
connection with transactions contemplated by the Participation Agreement and
have not generally represented the Owner Participant in its business
activities and are not familiar with the nature and extent of such activities.
Accordingly, we also have assumed without investigation that such activities
are not of such a nature as to cause the transactions contemplated by the
Participation Agreement to be governed by laws or regulations of the State of
New York or the United States of America applicable only because of such
activities (such as laws relating specifically to the banking, securities,
insurance or utility industries) and not applicable to business corporations
generally.
Based upon the foregoing but subject to the assumptions, limitations
and qualifications set forth herein, we are of the opinion that:
1. The Participation Agreement, the Indemnity Agreement, Ancillary
Agreement I and Ancillary Agreement II constitute legal, valid and binding
obligations of the Owner Participant, enforceable against the Owner
Participant in accordance with their respective terms, except as the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or similar laws affecting
the enforcement of creditors' rights generally, and except as enforcement
thereof is subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding at law or in equity).
2. Neither the execution and delivery of the Participation Agreement, the
Trust Agreement, the Indemnity Agreement, Ancillary Agreement I or Ancillary
Agreement II by the Owner Participant nor the consummation by the Owner
Participant of any of the transactions therein contemplated, or the
fulfillment of, or compliance with, the terms and provisions of any
thereof, (A) requires for its validity that the Owner Participant obtain
the consent or approval of, give notice to, register with, or take any
other action with respect to, any governmental authority or agency of the
State of New York or the Federal government of the United States, or (B)
contravenes any law, governmental rule or regulation of the State of New
York or the Federal government of the United States or any governmental
authority or agency thereof.
In rendering the foregoing opinions, we have relied, with your
consent, on the opinion of even date herewith of ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., counsel
for the Owner Participant, as to the matters set forth therein and our
opinions are subject to the same limitations and exceptions set forth
therein.
The foregoing opinions are subject, however, to the qualification
that we express no opinion as to matters relating to the title to or
sufficiency of description of any property or collateral described in the
Documents or the perfection or relative priority of any lien or security
interest created with respect to such property or collateral thereunder. In
addition, we express no opinion as to matters governed by (i) any tax laws,
(ii) the Transportation Code, or by any other laws, statutes, rules or
regulations of the United States particularly relating to the acquisition,
ownership, registration, leasing, use or sale of the Aircraft, the Airframe or
the Engines other than such laws relating to personal property generally,
(iii) any securities laws or (iv) laws pertaining to the Owner Participant
solely because of the business activities of the Owner Participant and which
are not applicable to business corporations generally. Further, we express no
opinion as to the severability of any provision of any documents.
We are licensed to practice law in the State of New York and we
express no opinions herein as to the laws of any state or jurisdiction other
than the laws of the State of New York and the laws of the United States of
America.
This opinion is furnished by us at your request and at the Owner
Participant's request for your sole benefit, and we agree that you may rely on
the opinions expressed herein. No other person or entity shall be entitled to
rely on the opinion expressed herein without our express prior written
consent. This opinion is limited to the matters stated herein, and no opinion
is implied or may be inferred beyond the matters expressly stated herein.
This opinion is of the date hereof and we undertake no, and disclaim any,
obligation to advise you of any changes in any matters set forth herein.
We rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
Winston & ▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(2)(b)
[Letterhead of Ameritech Corporation]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
I have acted as counsel to Ameritech Credit Corporation, a Delaware
corporation (the "Owner Participant"), in connection with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N586FE), dated as of April 1, 1996, as amended and restated as of
September 1, 1996 and as further amended and restated as of October 15, 1996
(the "Participation Agreement"), among Federal Express Corporation, as Lessee
(the "Lessee"), the Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company of New
York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as Original Loan Participants (the "Original Loan Participants"), First
Security Bank, National Association, not in its individual capacity, except as
otherwise expressly set forth therein, but solely as Owner Trustee under the
Trust Agreement (the "Owner Trustee"), State Street Bank and Trust Company,
not in its individual capacity, except as otherwise expressly set forth
therein, but solely as Indenture Trustee under the Indenture (the "Indenture
Trustee") and State Street Bank and Trust Company, not in its individual
capacity, except as otherwise expressly set forth therein, but solely as Pass
Through Trustee (the "Pass Through Trustee"). For the purposes of this
opinion, all terms defined in the Participation Agreement, but not defined
herein shall have the same meanings when used herein.
In connection with the opinion, I have examined the Participation
Agreement, the Trust Agreement, the Amendment No. 1 to the Tax Indemnity
Agreement, Ancillary Agreement I and Ancillary Agreement II and I have
examined originals, or copies certified or otherwise identified to my
satisfaction, of such records, documents, certificates and other instruments
as in my judgment are necessary or appropriate for purposes of this opinion.
In such examination I have assumed the genuineness of all signatures (other
than on behalf of the Owner Participant) and the authenticity of all documents
submitted to me as originals and the conformity with the originals of all
documents submitted to me as copies. As to any facts material to my opinions
expressed below, I have relied upon the representations and warranties
contained in or made pursuant to the Participation Agreement, the Trust
Agreement, the Amendment No. 1 to the Tax Indemnity Agreement, Ancillary
Agreement I and Ancillary Agreement II and upon originals, or copies
authenticated to my satisfaction, of such certificates of the Owner
Participant, or public officials and such corporate records, documents and
other instruments as in my judgment are necessary or appropriate to enable me
to render the opinions expressed below. I have assumed, except with regard to
the Owner Participant, that the Participation Agreement, the Trust Agreement,
the Amendment No. 1 to the Tax Indemnity Agreement, Ancillary Agreement I and
Ancillary Agreement II have been duly authorized, executed and delivered by the
parties thereto and that they constitute the legal, valid and binding
obligations of each party thereto enforceable against each such party in
accordance with their respective terms.
Based upon the foregoing, I advise you that, in my opinion:
1. The Owner Participant is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and
has or had, on the date of execution thereof, the full corporate power and
authority to execute, deliver and perform its obligations under the
Participation Agreement, the Trust Agreement, the Amendment No. 1 to the
Tax Indemnity Agreement, the Ancillary Agreement I and the Ancillary
Agreement II.
2. Each of the Participation Agreement, the Trust Agreement, the
Amendment No. 1 to the Tax Indemnity Agreement, the Ancillary Agreement I
and Ancillary Agreement II has been duly authorized, executed and delivered
by the Owner Participant.
3. Neither the execution and delivery by the Owner Participant of the
Participation Agreement, the Trust Agreement, the Amendment No. 1 to the Tax
Indemnity Agreement, the Ancillary Agreement I or the Ancillary Agreement
II nor the consummation by the Owner Participant of any of the transactions
contemplated thereby (a) requires the consent or approval of, the giving of
notice to, the registration with, the recording or filing of any document
with, or the taking of any other action with respect to any governmental
authority or agency of the State of Illinois or of the federal government
of the United States; or (b) violates any law, governmental rule or
regulation of the State of Illinois or of the federal government of the
United States.
4. Neither the execution and delivery by the Owner Participant of the
Participation Agreement, the Trust Agreement, the Amendment No. 1 to the Tax
Indemnity Agreement, the Ancillary Agreement I or the Ancillary Agreement
II nor the consummation by the Owner Participant of any of the transactions
contemplated thereby, conflicts with, results in a breach of or violates
any of the terms, conditions or provisions of (i) the Certificate of
Incorporation or By-laws of the Owner Participant, (ii) any order, writ,
injunction or decree known to me after due internal inquiry, of any court
or governmental authority against the Owner Participant or by which the
Owner Participant or any of its properties is bound or (iii) any indenture,
mortgage or contract or other material agreement or instrument known to me
after due internal inquiry, to which the Owner Participant is a party or
by which it or any of its properties is bound or constitutes a default
thereunder or results in the imposition of any lien upon any of its
properties.
5. There are no actions, suits or proceedings pending or, to the
best of my knowledge, threatened against or affecting the Owner Participant
before any court, administrative agency or other governmental body or
arbitration board or tribunal which, if adversely determined, would
materially and adversely affect the Owner Participant's ability to perform
its obligations under the Participation Agreement, the Trust Agreement, the
Amendment No. 1 to the Tax Indemnity Agreement, the Ancillary Agreement I
or the Ancillary Agreement II.
I am authorized to practice law in the State of Illinois and do not
hold myself out as an expert on the law of any state other than the State of
Illinois and the Delaware General Corporation Law. Consequently the
foregoing opinions are limited to the federal laws of the United States of
America, the laws of the State of Illinois and the Delaware General
Corporation Law, and I express no opinion as to the laws of any other state or
jurisdiction. Further, I have made no investigation and express no opinion,
as to the Federal Aviation Act or other laws, statutes, rules or regulations
applicable due to the particular nature of the aircraft and other equipment
subject to the Lease, and I express no opinion as to securities laws.
This opinion is rendered to you pursuant to Section 4.01(l)(ii) of the
Participation Agreement and is solely for your benefit in the transactions
contemplated by the Participation Agreement. This opinion may not be relied
upon by you for any other purpose, or relied upon by any other person for any
purpose without my prior written consent.
I rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. I hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇ ▇. ▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(3)
[Letterhead of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇]
[Refunding Date]
To the Parties Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company, a Massachusetts trust company, individually ("State Street"), and as
Indenture Trustee (the "Indenture Trustee") under the Trust Indenture and
Security Agreement (Federal Express Corporation Trust No. N586FE), dated as of
September 1, 1996, as amended and restated as of October 15, 1996 (the
"Indenture") between First Security Bank, National Association, not in its
individual capacity but solely as Owner Trustee (the "Owner Trustee") and the
Indenture Trustee, in connection with the transactions contemplated by that
certain Participation Agreement (Federal Express Corporation Trust No.
N586FE), dated as of April 1, 1996, as amended and restated as of September 1,
1996 and as further amended and restated as of October 15, 1996 (the
"Participation Agreement"), among Federal Express Corporation, as Lessee (the
"Lessee"); Ameritech Credit Corporation, as Owner Participant (the "Owner
Participant"); ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as Loan Participants (the
"Original Loan Participants"); the Owner Trustee; and the Indenture Trustee.
This opinion is being delivered pursuant to Section 4.01(l)(iii) of the
Participation Agreement. Except as otherwise defined herein, all capitalized
terms used herein shall have the respective meanings set forth in Schedule II
to the Participation Agreement.
Our representation of State Street has been as special counsel for the
purposes stated above. As to all matters of fact (including factual
conclusions and characterizations and descriptions of purpose, intention or
other state of mind), we have relied entirely upon (i) the representations of
the parties set forth in the Operative Agreements and (ii) the certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations and certificates.
We have examined each Operative Agreement to which State Street or the
Indenture Trustee, as the case may be, is a party (collectively, the
"Indenture Trustee Documents"), the Certificate of the Massachusetts
Commissioner of Banks relating to State Street and originals, or copies
certified or otherwise identified to our satisfaction, of such other
documents, corporate records, certificates, or other instruments as we have
deemed necessary or advisable for the purposes of this opinion.
We have assumed the genuineness of all signatures (other than those on
behalf of State Street and the Indenture Trustee), the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form
and the legal competence of each individual executing any document (other than
on behalf of State Street and the Indenture Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we are
aware or which are known to us, or with another similar qualification, the
relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion, the
individual lawyers in the firm who have participated directly in the specific
transactions to which this opinion relates or in the preparation of this
opinion and the partner of the firm responsible for State Street corporate
trust matters, and without any special or additional investigation undertaken
for the purposes of this opinion.
Each opinion set forth below relating to the enforceability of any
agreement or instrument against State Street and the Indenture Trustee, as
applicable, is subject to the following general qualifications:
(i) as to any Indenture Trustee Document, we assume that such agreement is
the legal, valid and binding obligation of each other party thereto;
(ii) the enforceability of any obligation of State Street and the
Indenture Trustee may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, marshalling or other similar laws and
rules of law affecting the enforcement of rights and remedies (including such
as may deny giving effect to waivers of debtors' or guarantors' rights) of
creditors generally; and
(iii) the enforcement of any rights and availability of any specific or
equitable relief may in all cases by subject to an implied duty of good faith
and to general principals of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
Subject to the limitations set forth herein, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions expressed herein are limited solely to the internal
substantive laws of the Commonwealth of Massachusetts and the Federal laws of
the United States of America. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
other than our opinion expressed in Paragraph 1 hereof with respect to the
citizenship of State Street, no opinion is expressed as to matters governed by
the Transportation Code or by any other law, statute, rule or regulation of
the United States relating to the acquisition, ownership, registration, use,
operation, maintenance, repair, replacement or sale of or the nature of the
Aircraft, Airframe or the Engines.
With your permission and without investigation, with respect to
paragraph 4 below in connection with our opinion relating to the legality,
validity, binding effect and enforceability of the documents there referred
to, to the extent that the laws of the Commonwealth of Massachusetts do not
govern such documents, we have assumed that the laws of the jurisdiction whose
laws govern such documents are not materially different from the internal
substantive laws of the Commonwealth of Massachusetts.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their respective successors and assigns in
connection with the transactions contemplated by the Operative Agreements and
may not be used or relied upon by any other person or for any other purpose.
Based upon the foregoing, we are of the opinion that:
1. State Street is a Massachusetts trust company, duly organized
and validly existing in good standing with the Massachusetts Commissioner of
Banks under the laws of the Commonwealth of Massachusetts, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has the full corporate power and authority to
execute, deliver and perform its obligations under the Indenture Trustee
Documents and, in its capacity as Indenture Trustee, to authenticate the
Certificates delivered on the Refunding Date and to perform its other
obligations under the Indenture Trustee Documents.
2. The execution and delivery of the Indenture Trustee Documents by
State Street, in its individual capacity or as Indenture Trustee, as the case
may be, and compliance by State Street or the Indenture Trustee, as the case
may be, individually or as Indenture Trustee, as the case may be, with all of
the provisions thereof do not and will not contravene any Massachusetts or
Federal law, rule or regulation governing the banking or trust powers of State
Street or the Indenture Trustee, or any order or judgment known to us, of any
Massachusetts or Federal court or governmental authority applicable to or
binding on State Street, individually or as Indenture Trustee, or contravene
the provisions of, or constitute a default under, or result in the creation
of a Lien on any property of State Street or the Indenture Trustee under, its
charter documents or By-Laws or any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit agreement, in
each case known to us, or any other agreement or instrument, in each case
known to us, to which State Street, individually or as Indenture Trustee, is a
party or by which it or any of its property may be bound or affected, other
than the Lien of the Indenture.
3. No order, license, consent, permit, authorization or approval
of or exemption by, and no notice to or filing with, or the taking of any
other action in respect of, any Massachusetts or Federal governmental
authority governing the banking or trust powers of State Street or the
Indenture Trustee, and no filing, recording, publication or registration in
any public office is required under Massachusetts or Federal law pertaining to
its banking or trust powers for the due execution, delivery or performance by
State Street, individually or as Indenture Trustee, as the case may be, of the
Indenture Trustee Documents and of the certificate of authentication, as
Indenture Trustee, on the Certificates, or for the legality, validity, binding
effect or enforceability thereof against State Street or the Indenture
Trustee, as the case may be.
4. Each of the Indenture Trustee Documents has been duly
authorized, executed and delivered by State Street, in its individual capacity
or as Indenture Trustee, as the case may be, and each such document
constitutes a legal, valid and binding obligation of State Street, in its
individual capacity or as Indenture Trustee, as the case may be, enforceable
against State Street, in its individual capacity or as Indenture Trustee, as
the case may be, in accordance with its terms.
5. The Certificates issued and dated the Refunding Date have been
duly authenticated and delivered by the Indenture Trustee pursuant to the
terms of the Indenture.
6. There are no fees, taxes or other governmental charges payable
by the Owner Trustee, the Indenture Trustee (except taxes imposed on fees
payable to the Indenture Trustee in its individual capacity) or the
Certificate Holders under the laws of the Commonwealth of Massachusetts or any
political subdivision thereof in connection with the execution, delivery or
performance of any of the Operative Agreements or in connection with the
issuance and acquisition of the Certificates by the Certificate Holders or the
beneficial interest of the Certificate Holders in the Trust Indenture Estate
solely because the Indenture Trustee in its individual capacity (a) is
incorporated under the laws of the Commonwealth of Massachusetts, (b) has its
principal place of business in the Commonwealth of Massachusetts, (c) performs
(in its individual capacity or as Indenture Trustee) any or all of its duties
under the Indenture Trustee Documents in the Commonwealth of Massachusetts,
and (d) engages in any activities unrelated to the transactions contemplated
by the Indenture Trustee Documents in the Commonwealth of Massachusetts.
Neither the Indenture Trustee nor the trust created under the Indenture will
be subject to any fee, tax or other governmental charge (except for taxes
imposed on fees payable to the Indenture Trustee in its individual capacity)
under the laws of the Commonwealth of Massachusetts or any political
subdivision thereof in existence on the date hereof, on, based on or measured
by, directly or indirectly, the gross receipts, net income or value of the
Trust Indenture Estate solely because the Indenture Trustee in its individual
capacity (a) is incorporated under the laws of the Commonwealth of
Massachusetts, (b) has its principal place of business in the Commonwealth of
Massachusetts, (c) performs (in its individual capacity or as Indenture
Trustee) any or all of its duties under the Indenture Trustee Documents in the
Commonwealth of Massachusetts, and (d) engages in any activities unrelated to
the transactions contemplated by the Indenture Trustee Documents in the
Commonwealth of Massachusetts. There is no fee, tax or other governmental
charge (except for taxes imposed on fees payable to the Indenture Trustee in
its individual capacity) under the laws of the Commonwealth of Massachusetts
or any political subdivision thereof in existence on the date hereof, on,
based on or measured by any payments under the Certificates by reason of the
creation of the trust under the Indenture solely because the Indenture Trustee
in its individual capacity (a) is incorporated under the laws of the
Commonwealth of Massachusetts, (b) has its principal place of business in the
Commonwealth of Massachusetts, (c) performs (in its individual capacity or as
Indenture Trustee) any or all of its duties under the Indenture Trustee
Documents in the Commonwealth of Massachusetts, and (d) engages in any
activities unrelated to the transactions contemplated by the Indenture Trustee
Documents in the Commonwealth of Massachusetts. We express no opinion as to
whether or not any fees, taxes or other charges are now or hereafter may be
payable by the Original Loan Participants or the Owner Participant to the
Commonwealth of Massachusetts or any political subdivision thereof in
connection with (a) the execution, delivery, or performance by any of the
Indenture, the Participation Agreement or any of the other Operative
Agreements and (b) the making by the Owner Participant of its investment in
the Aircraft.
7. To the best of our knowledge, there are no pending or threatened
actions or proceedings against State Street before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of State Street, individually or
as Indenture Trustee, to perform its obligations under the Indenture Trustee
Documents.
We rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(4)
[Letterhead of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To the Parties Named on Schedule A attached hereto
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 4.01(l)(iv) of
the Participation Agreement (Federal Express Corporation Trust No. N586FE),
dated as of April 1, 1996, as amended and restated as of September 1, 1996 and
as further amended and restated as of October 15, 1996 (the "Participation
Agreement") among Federal Express Corporation, as lessee (the "Lessee"),
Ameritech Credit Corporation, as owner participant (the "Owner Participant"),
▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America National Trust &
Savings Association, The Chase Manhattan Bank, Commerzbank AG, Atlanta Agency
and NationsBank, N.A. (South), as original loan participants (the "Original
Loan Participants"), First Security Bank, National Association, as owner
trustee (the "Owner Trustee"), State Street Bank and Trust Company, as
indenture trustee (the "Indenture Trustee"), and State Street Bank and Trust
Company, as pass through trustee (the "Pass Through Trustee"), which
Participation Agreement amends and restates that certain Participation
Agreement (Federal Express Corporation Trust No. N586FE), dated as of
September 1, 1996 (the "Original Participation Agreement") among the Lessee,
the Owner Participant, the Original Loan Participants, the Owner Trustee and
the Indenture Trustee, with respect to that portion of Subtitle VII of Title
49 of the United States Code relative to the recordation of instruments and
the registration of aircraft thereunder.
The capitalized terms herein shall, unless otherwise defined, have
the same meanings given them in the Participation Agreement or in Annex I
attached hereto.
We have examined and filed on this date with the Federal Aviation
Administration (the "FAA") the following described instruments at the
respective times listed below:
(a) Trust Agreement (Federal Express Corporation Trust No. N586FE)
dated as of April 1, 1996, as amended and restated as of
September 1, 1996 and as further amended and restated as of
October 15, 1996 (the "Trust Agreement") between the Owner
Participant and the Owner Trustee, which Trust Agreement amends
and restates the Original Trust Agreement, which Trust
Agreement was filed at ____ _.m., C._.T.;
(b) Trust Indenture and Security Agreement (Federal Express
Corporation Trust No. N586FE) dated as of September 1, 1996, as
amended and restated as of October 15, 1996 (the "Indenture")
between the Owner Trustee and the Indenture Trustee, which
Indenture amends and restates the Original Indenture, which
Indenture was filed at ____ _.m., C._.T.; and,
(c) Lease Agreement (Federal Express Corporation Trust No. N586FE)
dated as of September 1, 1996, as amended and restated as of
October 15, 1996 (the "Lease") between the Owner Trustee, as
lessor, and the Lessee, as lessee, which Lease amends and
restates the Original Lease, with the Indenture attached
thereto, which Lease with the Indenture attached was filed at
____ _.m., C._.T.
The Confidential Omissions were intentionally omitted from the FAA
filing counterparts of the Lease and the Indenture as containing confidential
financial information.
Based upon our examination of the above described instruments and of
such records of the FAA as we deemed necessary to render this opinion, it is
our opinion that:
1. AC Form 8050-2 Aircraft ▇▇▇▇ of Sale dated September 23, 1996 (the
"FAA ▇▇▇▇ of Sale") from the Lessee, as seller, conveying title to
the Airframe to the Owner Trustee has been duly recorded by the FAA
on September 23, 1996 and assigned Conveyance No. P08256;
2. the Indenture and the Lease with the Indenture attached are in due
form for recordation by and have been duly filed for recordation with
the FAA pursuant to and in accordance with the provisions of 49
U.S.C. Section 44107;
3. the Trust Agreement is in due form for filing and has been duly filed
with the FAA pursuant to and in accordance with the provisions of 49
U.S.C. Section 44103(a);
4. the Original Trust Agreement was duly filed with the FAA on September
23, 1996 pursuant to and in accordance with the provisions of 49
U.S.C. Section 44103(a);
5. the Original Indenture with the Indenture and Security Agreement
Supplement attached has been duly filed with and duly recorded by the
FAA pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44107;
6. the Original Lease with the Lease Supplement, the Original Indenture
and the Indenture and Security Agreement Supplement attached was duly
filed with and duly recorded by the FAA pursuant to and in accordance
with the provisions of 49 U.S.C. Section 44107;
7. the Airframe is duly registered in the name of the Owner Trustee
pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44103(a);
8. the Owner Trustee has valid legal title to the Airframe and the
Aircraft is free and clear of all Liens, except (i) the security
interest created by the Original Indenture, as amended and restated
by the Indenture, as supplemented by the Indenture and Security
Agreement Supplement, and (ii) the rights of the parties under the
Original Lease, as amended and restated by the Lease, as supplemented
by the Lease Supplement;
9. the Original Indenture, as amended and restated by the Indenture, as
supplemented by the Indenture and Security Agreement Supplement,
constitutes a duly perfected first priority security interest in the
Aircraft and a duly perfected first assignment of all the right,
title and interest of the Owner Trustee in, to and under the Original
Lease, as amended and restated by the Lease, as supplemented by the
Lease Supplement (insofar as such assignment affects an interest
covered by the recording system established by the FAA pursuant to 49
U.S.C. Section 44107), and no other registration of the Airframe or
filings other than filings with the FAA (which have been duly
effected) are necessary in order to perfect in any applicable
jurisdiction in the United States (A) the Owner Trustee's title to
the Airframe or (B) such security interest and assignment (insofar as
such assignment affects an interest covered by the recording system
established by the FAA pursuant to 49 U.S.C. Section 44107), it being
understood that no opinion is herein expressed as to the validity,
priority or enforceability of such security interest and assignment
under local law or as to the recognition of the perfection of such
security interest and assignment as against third parties in any
legal proceeding outside the United States;
10. no authorization, approval, consent, license or order of, or
registration with, or the giving of notice to, the FAA is required
for the valid authorization, delivery and performance of the Original
Lease, as amended and restated by the Lease, as supplemented by the
Lease Supplement, the Original Indenture, as amended and restated by
the Indenture, as supplemented by the Indenture and Security
Agreement Supplement, or the Original Trust Agreement, as amended and
restated by the Trust Agreement, except for such filings as are
referred to in our opinion dated September 23, 1996 (which have been
duly effected) and the filings referred to in clauses (a), (b) and
(c) above; and,
11. neither the authorization, issuance and delivery of the Certificates,
the execution and delivery by the parties thereto of the Original
Trust Agreement, the Trust Agreement, the Original Indenture, the
Indenture, the Indenture and Security Agreement Supplement, the
Original Participation Agreement, the Participation Agreement, the
FAA ▇▇▇▇ of Sale, the Original Lease, the Lease and the Lease
Supplement or the performance by the parties thereto of: (i) the
Original Trust Agreement, as amended and restated by the Trust
Agreement; (ii) the Original Indenture, as amended and restated by
the Indenture, as supplemented by the Indenture and Security Agreement
Supplement; (iii) the Original Participation Agreement, as amended and
restated by the Participation Agreement; and (iv) the Original Lease,
as amended and restated by the Lease, as supplemented by the Lease
Supplement, in accordance with the provisions thereof, nor the
consummation by the parties thereto of any of the transactions
contemplated thereby, requires the consent or approval of, or the
giving of notice to, or the registration with, or the taking of any
other action in respect of, the FAA except for the filings, the
recordations and the filings for recordations specified elsewhere in
this opinion.
No opinion is expressed as to the Airframe during any period or
periods of time during which it has not been subject to United States
registration.
No opinion is expressed as to laws other than Federal laws of the
United States. In rendering this opinion, we were subject to the accuracy of
the FAA, its employees and agents, in the filing, indexing and recording of
instruments filed with the FAA and in the search for encumbrance
cross-reference index cards for the Engines. Further, in rendering this
opinion we are assuming the validity and enforceability of the above described
instruments under local law. Since our examination was limited to records
maintained by the FAA, our opinion does not cover liens which are perfected
without the filing of notice thereof with the FAA, such as federal tax liens,
liens arising under 29 U.S.C. Section 1368(a), possessory artisan's liens, or
matters of which the parties have actual notice. In rendering this opinion we
are assuming that there are no documents with respect to the Aircraft which
have been filed for recording under the recording system of the FAA but have
not yet been listed in the available records of such system as having been so
filed.
In rendering this opinion we have relied upon the opinion of the
Assistant Chief Counsel of the Aeronautical Center dated October ___, 1996 and
have continued to rely upon the opinion of the Assistant Chief Counsel of the
Aeronautical Center dated September 16, 1996, copies of which are attached
hereto.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
For the Firm
Annex I
Certain Definitions
Airframe, Engines and Aircraft
One (1) ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MD-11F aircraft bearing manufacturer's
serial number 48487 and U.S. Registration No. N586FE (the "Airframe") and
three (3) General Electric CF6-80C2-D1F aircraft engines bearing
manufacturer's serial numbers 702-656, 702-468 and 702-786 (the "Engines")
(the Airframe and the Engines are referred to collectively as the "Aircraft").
Original Trust Agreement
Trust Agreement (Federal Express Corporation Trust No. N586FE) dated
as of April 1, 1996 as amended and restated as of September 1, 1996 between
Ameritech Credit Corporation, as owner participant, and First Security Bank,
National Association, as owner trustee, which was filed with the FAA on
September 23, 1996.
Original Indenture
Trust Indenture, Mortgage and Security Agreement (Federal Express
Corporation Trust No. N586FE) dated as of September 1, 1996 between First
Security Bank, National Association, as owner trustee, and State Street Bank
and Trust Company, as indenture trustee, which together with the Indenture and
Security Agreement Supplement (as hereinafter defined) attached thereto was
recorded as one instrument by the FAA on September 24, 1996 and assigned
Conveyance No. HH012951.
Indenture and Security Agreement Supplement
Indenture and Security Agreement Supplement No. 1 (Federal Express
Corporation Trust No. N586FE) dated September 23, 1996 between First Security
Bank, National Association, as owner trustee, and State Street Bank and Trust
Company, as indenture trustee, with respect to the Aircraft, which was
attached to and recorded by the FAA as one instrument with the Original
Indenture.
Original Lease
Lease Agreement (Federal Express Corporation Trust No. N586FE) dated
as of September 1, 1996 between First Security Bank, National Association, as
owner trustee, as lessor, and Federal Express Corporation, as lessee, which
together with the Lease Supplement (as hereinafter defined), the Original
Indenture and the Indenture and Security Agreement Supplement attached thereto
was recorded as one instrument by the FAA on September 24, 1996 and assigned
Conveyance No. HH012952.
Lease Supplement
Lease Supplement ▇▇. ▇ (▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇)
dated September 23, 1996 between First Security Bank, National Association, as
owner trustee, as lessor, and Federal Express Corporation, as lessee, with
respect to the Aircraft, which was attached to and recorded by the FAA as one
instrument with the Original Lease.
Confidential Omissions
The Lease was filed with the FAA, with (i) Basic Rent (Schedule II),
(ii) the Stipulated Loss Values (Schedule III), (iii) the Termination Values
(Schedule IV), (iv) the Purchase Option Schedule (Schedule V) omitted from the
FAA filing counterpart thereof as containing confidential financial
information; and (v) the purchase price under Section 4.02(a)(F) of the Lease
set forth in Ancillary Agreement II, which was not attached to the FAA filing
counterpart of the Lease or otherwise filed with the FAA for recordation.
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(5)
[Letterhead of Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
We have acted as special counsel to First Security Bank, National
Association, a national banking association ("First Security"), in connection
with the Trust Agreement (Federal Express Corporation Trust No. N586FE), dated
as of April 1, 1996, as amended and restated as of September 1, 1996 and as
further amended and restated as of October 15, 1996 (the "Trust Agreement"),
between First Security and Ameritech Credit Corporation, a Delaware
corporation (the "Owner Participant"). Pursuant to the Participation
Agreement (Federal Express Corporation Trust No. N586FE), dated as of April 1,
1996, as amended and restated as of September 1, 1996 and as further amended
and restated as of October 15, 1996 (the "Participation Agreement"), among
Federal Express Corporation, as Lessee, the Owner Participant, ▇▇▇▇▇▇ Guaranty
Trust Company of New York, Bank of America National Trust & Savings
Association, The Chase Manhattan Bank, Commerzbank AG, Atlanta Agency and
NationsBank, N.A. (South), as Original Loan Participants, First Security, not
in its individual capacity except as otherwise expressly set forth therein but
solely as Owner Trustee (the "Owner Trustee") under the Trust Agreement, State
Street Bank and Trust Company, as Indenture Trustee and State Street Bank and
Trust Company, as Pass Through Trustee, one ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ MD-11F aircraft
bearing U.S. Registration No. N586FE (the "Aircraft") is being refinanced.
This opinion is furnished pursuant to Section 4.01(l)(vii) of the
Participation Agreement. Capitalized terms used herein and not otherwise
defined are used as defined in the Participation Agreement, except that
references herein to any instrument shall mean such instrument as in effect on
the date hereof.
We have examined executed counterparts or copies otherwise identified
to our satisfaction of the following documents:
(a) The Participation Agreement;
(b) The Trust Agreement;
(c) The Indenture;
(d) The Indenture and Security Agreement Supplement No. 1 dated
September 23, 1996;
(e) The Lease;
(f) The Ancillary Agreement I;
(g) The Ancillary Agreement II:
(h) The Lease Supplement dated September 23, 1996 (each of the
documents identified in paragraphs (a) through (h) being
collectively referred to as the "Owner Trustee Documents"); and
(h) The Certificates being issued today (the "Certificates").
We have also examined originals or copies of such other documents,
such corporate records, certificates and other statements of governmental
officials and corporate officers and other representatives of the corporations
or entities referred to herein and such other instruments as we have deemed
necessary or appropriate for the purposes of this opinion. Moreover, as to
certain facts material to the opinions expressed herein, we have relied upon
representations and warranties contained in the Owner Trustee Documents.
Based upon the foregoing and upon an examination of such questions of
law as we have considered necessary or appropriate, and subject to the
assumptions, exceptions and qualifications set forth below, we advise you
that, in our opinion:
1. First Security is a national banking association duly organized
and validly existing under the laws of the United States of America holding
a valid certificate to do business as a national banking association, with
banking and trust powers, is a Citizen of the United States within the
meaning of Section 40102(a)(15) of the Transportation Code, and each of
First Security and the Owner Trustee, as the case may be, has or had, on
the date of execution thereof, full corporate power, authority and legal
right to execute, deliver and perform each of the Owner Trustee Documents
to which it is or is to be a party and to issue, execute, deliver and
perform the Certificates.
2. Each of First Security and the Owner Trustee, as the case may be,
has duly authorized, executed and delivered each Owner Trustee Document to
which it is a party; each such document constitutes a legal, valid and
binding obligation of the Owner Trustee (and, to the extent set forth in
the respective Owner Trustee Document, of First Security) enforceable
against the Owner Trustee (and, to the extent set forth in the respective
Owner Trustee Document, against First Security) in accordance with its
terms; and assuming the Trust Agreement was properly authorized, executed
and delivered by the Owner Participant and that the terms of the Trust
Agreement are not in violation of any laws, documents, judgments,
regulations or other provisions applicable to the Owner Participant, the
Trust Agreement constitutes, under the laws of the State of Utah, a legal,
valid and binding obligation of the Owner Participant enforceable against
the Owner Participant in accordance with its terms. The Certificates have
been duly issued, executed and delivered by the Owner Trustee, pursuant to
authorization contained in the Trust Agreement, and constitute the legal,
valid and binding obligations of the Owner Trustee enforceable against the
Owner Trustee in accordance with their terms and the terms of the
Indenture; and the Certificates are entitled to the benefits and security
afforded by the Indenture in accordance with their terms and the terms of
the Indenture.
3. On the Delivery Date, the Owner Trustee received from the Lessee
such title to the Aircraft as the Lessee conveyed to the Owner Trustee,
subject to the rights of the Owner Trustee and the Lessee under the
Original Lease and the security interest created pursuant to the Original
Indenture and the Indenture Supplement; and to our knowledge, there exist
no Liens affecting the title of the Owner Trustee to the Lessor's Estate
resulting from claims against First Security not related to the ownership
of the Lessor's Estate or the administration of the Lessor's Estate or any
other transaction pursuant to the Indenture or any document included in the
Trust Indenture Estate.
4. Under the laws of the State of Utah, all of the properties which
are part of the Trust Indenture Estate have been pledged and mortgaged with
the Indenture Trustee as part of the Trust Indenture Estate and the
beneficial interest of the Owner Participant under the Trust Agreement in
and to such properties is subject, to the extent provided in the Indenture,
to the Lien of the Indenture in favor of the holders of the Certificates
issued and to be issued under the Indenture.
5. To the extent that the Uniform Commercial Code of the State of
Utah (the "UCC") is applicable, except for the Indenture Trustee's taking
possession of all monies and securities (including instruments)
constituting part of the Trust Indenture Estate, no action, including the
filing or recording of any document, is necessary (i) to create under the
UCC the security interest in the Trust Indenture Estate (including the
grant and assignment unto the Indenture Trustee of the security interest in
all estate, right, title and interest of the Owner Trustee in, to and under
the Lease, the Lease Supplement and the Participation Agreement), which the
Indenture by its terms purports to create in favor of the Indenture
Trustee, and (ii) to perfect in the State of Utah such security interest,
except for the filing of a UCC financing statement complying with the
formal requisites of Section 9-402 of the UCC in the office of the Division
of Corporations and Commercial Code of the State of Utah with respect to
the security interest, which filing has been duly effected, and the filing
of continuation statements with respect thereto required to be filed at
periodic intervals under the UCC.
6. The Trust Agreement duly creates a legal and valid trust under
Utah law, the trust created by the Trust Agreement has been duly created
and exists for the benefit of the Owner Participant, and the Trust
Agreement creates for the benefit of the Owner Participant the interest in
the properties referred to in Section 1.02 of the Trust Agreement which the
Trust Agreement by its terms purports to create, which interest is subject
and subordinate to the security interests created by the Indenture to the
extent provided in the Indenture.
7. Neither the authorization, execution and delivery by the Owner
Trustee or First Security, as the case may be, of the Owner Trustee
Documents, nor the issuance, execution and delivery by the Owner Trustee of
the Certificates nor the fulfillment or compliance by the Owner Trustee or
First Security with the respective terms and provisions thereof nor the
consummation of any of the transactions by the Owner Trustee or First
Security, as the case may be, contemplated thereby requires the consent or
approval of, the giving of notice to, the registration with, or the taking
of any other action in respect of, any court or administrative or
governmental authority or agency of the State of Utah or the United States
of America governing the banking or trust powers of First Security.
8. Assuming that (i) the Aircraft is not used in Utah and is not
physically located in Utah at the commencement or termination of the Term
or during such Term, (ii) in connection with any sale of the Aircraft, such
Aircraft will not be physically delivered in Utah to a buyer nor be shipped
from a point within Utah to a buyer, and (iii) the trust created by the
Trust Agreement is treated as a grantor trust for federal income tax
purposes within the contemplation of Sections 671 through 678 of the
Internal Revenue Code of 1986, there are no fees, taxes, or other charges
(except taxes imposed on fees payable to the Owner Trustee) payable to the
State of Utah or any political subdivision thereof in connection with the
execution, delivery or performance by the Owner Trustee, the Indenture
Trustee, the Lessee or the Owner Participant, as the case may be, of the
Owner Trustee Documents or in connection with the making by the Owner
Participant of its investment in the Aircraft or its acquisition of the
beneficial interest in the Lessor's Estate or in connection with the
issuance and acquisition of the Certificates, and neither the Owner
Trustee, the Lessor's Estate nor the trust created by the Trust Agreement
will be subject to any fee, tax or other governmental charge (except taxes
on fees payable to the Owner Trustee) under the laws of the State of Utah
or any political subdivision thereof on, based on or measured by, directly
or indirectly, the gross receipts, net income or value of the Lessor's
Estate solely by reason of the creation or continued existence of the trust
under the terms of the Trust Agreement pursuant to the laws of the State of
Utah or the Owner Trustee's performance of its duties under the Trust
Agreement.
9. The execution, delivery and performance by the Owner Trustee or
First Security, as the case may be, of each of the Owner Trustee Documents
and the issuance, execution, delivery and performance of the Certificates
by the Owner Trustee are not or were not, on the date of execution thereof,
in violation of the charter or by-laws of First Security or of any law,
governmental rule, or regulation of the State of Utah or the United States
of America governing the banking or trust powers of First Security or, to
our knowledge, of any indenture, mortgage, bank credit agreement, note or
bond purchase agreement, long-term lease, license or other agreement or
instrument to which it is a party or by which it is bound or, to our
knowledge, of any judgment or order of the State of Utah or the United
States of America relating to the banking or trust powers of First Security.
10. There is no fee, tax or other governmental charge under the laws
of the State of Utah or any political subdivision thereof in existence on
the date hereof on, based on or measured by any payments under the
Certificates or the beneficial interests in the Lessor's Estate, by reason
of the creation of the trust under the Trust Agreement, pursuant to the
laws of the State of Utah or the Owner Trustee's performance of its duties
under the Trust Agreement, within the State of Utah, which would not have
been imposed if First Security did not have its principal place of business
and did not perform its obligations under the Owner Trustee Documents in
the State of Utah.
11. Neither a Utah court nor a federal court applying federal law or
Utah law, if properly presented with the issue and after having properly
considered such issue, would permit the Owner Participant to terminate the
Trust Agreement, except in accordance with its terms or with the consent of
the Indenture Trustee, as long as the Lien of the Indenture on the Trust
Estate has not been released or payment of the principal of, and Make-Whole
Premium, if any, and interest on, the Certificates have not been made in
full.
12. Although there is no Utah case directly on point, under the
laws of the State of Utah, so long as the Trust Agreement has not been
terminated in accordance with its terms or with the consent of the
Indenture Trustee, creditors of any person that is an Owner Participant,
holders of a lien against the assets of any such person, such as
trustees, receivers or liquidators (whether or not any insolvency
proceeding has been commenced) (collectively, the "Creditors") may
acquire valid claims and liens, as to the Trust Estate, only against the
rights of such Owner Participant under the Trust Agreement or in the
Trust Estate, and do not have, and may not through the enforcement of
such Creditor's rights acquire, any greater rights than such Owner
Participant with respect to the Trust Agreement or the Trust Estate.
13. There are no actions, suits, investigations or proceedings
pending or, to our knowledge, threatened against or affecting First
Security or the Owner Trustee, as the case may be, or any of its properties
in any court or before any administrative agency or arbitrator, which, if
adversely determined, would materially adversely affect the ability of
First Security or the Owner Trustee, as the case may be, to perform its
obligations under any of the Owner Trustee Documents, and there are no
pending or, to our knowledge, threatened actions or proceedings before any
court, administrative agency or tribunal involving First Security or the
Owner Trustee, as the case may be, in connection with the transactions
contemplated by any of the Owner Trustee Documents.
The foregoing opinions are subject to the following assumptions,
exceptions and qualifications:
A. The foregoing opinions are limited to the laws of the State of
Utah and the federal laws of the United States of America governing the
banking and trust powers of First Security and Title II of the United States
Code entitled "Bankruptcy". In addition, we express no opinion with respect
to (i) federal securities laws, including the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, and the Trust
Indenture Act of 1939, as amended, (ii) the Federal Aviation Act of 1958, as
amended (except with respect to the opinion set forth in paragraph 1 above
concerning the citizenship of First Security) and (iii) state securities or
blue sky laws. Insofar as the foregoing opinions relate to the validity
and enforceability in the State of Utah of the Certificates and the other
Owner Trustee Documents expressed to be governed by the laws of the State
of New York, we have assumed that the laws of New York are identical to the
laws of Utah in all material respects, and that the Certificates and such
other Owner Trustee Documents constitute legal, valid, binding and
enforceable documents or instruments under such laws (as to which we
express no opinion). No opinion is expressed as to the priority of any
security interest or as to title to any part of the Trust Estate.
B. The foregoing opinions regarding enforceability of any document or
instrument, except for the opinions set forth in paragraphs 11 and 12 above,
are subject to (i) applicable bankruptcy, insolvency, moratorium,
reorganization, receivership and similar laws affecting the rights and
remedies of creditors generally, and (ii) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
C. We have assumed the due authorization, execution and delivery by
each of the parties thereto, other than First Security and the Owner Trustee,
of the Owner Trustee Documents to which each is a party and that each of such
parties has the full power, authority and legal right to execute and deliver
each such document.
D. The opinion set forth in paragraph 1 above concerning the
citizenship of First Security is based upon the facts contained in an
affidavit of First Security, made by its Vice President, the facts set forth
in which we have not independently verified.
E. We have assumed the due authentication of the Certificates by the
Indenture Trustee.
F. We have assumed that all signatures (other than those of the Owner
Trustee or First Security) on documents and instruments examined by us are
genuine, that all documents and instruments submitted to us as originals are
authentic, and that all documents and instruments submitted to us as copies
conform with the originals, which facts we have not independently verified.
G. We do not purport to be experts in respect of, or express any
opinion concerning, aviation law or other laws, rules or regulations
applicable to the particular nature of the equipment conveyed to the Owner
Trustee.
H. We have made no investigation of, and we express no opinion
concerning, the nature of the title to any part of the Lessor's Estate or the
priority of any mortgage or security interest.
I. We have assumed that the Participation Agreement and the
transactions contemplated thereby are not within the prohibitions of Section
406 of the Employee Retirement Income Security Act of 1974.
This opinion is rendered solely for your benefit and may not be
relied upon by any other person or entity for any purpose without our prior
written consent, except that the law firm of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ may rely on
this opinion in connection with the rendering of its opinion dated the date
hereof in connection with the financing described herein.
We rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(6)
[Letterhead of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇]
[Refunding Date]
To the Parties Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N586FE
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company, a Massachusetts trust company, individually ("State Street"), and as
Pass Through Trustee (the "Pass Through Trustee") with respect to the Pass
Through Trust Agreement dated as of June 1, 1996 (the "Pass Through Trust
Agreement"), as supplemented by the Series Supplements dated the date hereof
between Federal Express Corporation and the Pass Through Trustee, designated
as Series Supplement 1996-B1 and 1996-B2, respectively (the "Series
Supplements") and in connection with the transactions contemplated by that
certain Participation Agreement (Federal Express Corporation Trust No.
N586FE), dated as of April 1, 1996, as amended and restated as of September 1,
1996 and as further amended and restated as of October 15, 1996 (the
"Participation Agreement") among Federal Express Corporation, as Lessee (the
"Lessee"); Ameritech Credit Corporation, as Owner Participant (the "Owner
Participant"); ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants; First Security Bank, National Association, a national banking
association, not in its individual capacity but solely as Owner Trustee under
the Trust Agreement; State Street, not in its individual capacity but solely
as Indenture Trustee under the Indenture; and State Street, not in its
individual capacity, except as otherwise stated therein, but solely as Pass
Through Trustee. This opinion is being delivered pursuant to Section
4.01(l)(ix) of the Participation Agreement. Except as otherwise defined
herein, all capitalized terms used herein shall have the respective meanings
set forth in Schedule II to the Participation Agreement.
Our representation of State Street has been as special counsel for the
purposes stated above. As to all matters of fact (including factual
conclusions and characterizations and descriptions of purpose, intention or
other state of mind), we have relied entirely upon (i) the representations of
the parties set forth in the Operative Agreements and (ii) the certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations and certificates.
We have examined each Operative Agreement to which State Street or the
Pass Through Trustee, as the case may be, is a party, the Pass Through Trust
Agreement and the Series Supplements (collectively, the "Pass Through Trustee
Documents"), the Certificate of the Massachusetts Commissioner of Banks
relating to State Street and originals, or copies certified or otherwise
identified to our satisfaction, of such other documents, corporate records,
certificates, or other instruments as we have deemed necessary or advisable
for the purposes of this opinion.
We have assumed the genuineness of all signatures (other than those on
behalf of State Street and the Pass Through Trustee), the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form
and the legal competence of each individual executing any document (other than
on behalf of State Street and the Pass Through Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we are
aware or which are known to us, or with another similar qualification, the
relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion, the
individual lawyers in the firm who have participated directly in the specific
transactions to which this opinion relates or in the preparation of this
opinion and the partner of the firm responsible for State Street corporate
trust matters, and without any special or additional investigation undertaken
for the purposes of this opinion.
Each opinion set forth below relating to the enforceability of any
agreement or instrument against State Street and the Pass Through Trustee, as
applicable, is subject to the following general qualifications:
(i) as to any Pass Through Trustee Document, we assume that such agreement
is the legal, valid and binding obligation of each other party thereto;
(ii) the enforceability of any obligation of State Street and the Pass
Through Trustee may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, marshalling or other similar laws and
rules of law affecting the enforcement of rights and remedies (including such
as may deny giving effect to waivers of debtors' or guarantors' rights) of
creditors generally; and
(iii) the enforcement of any rights and availability of any specific or
equitable relief may in all cases by subject to an implied duty of good faith
and to general principals of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
Subject to the limitations set forth herein, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions expressed herein are limited solely to the internal
substantive laws of the Commonwealth of Massachusetts and the Federal laws of
the United States of America. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
other than our opinion expressed in Paragraph 1 hereof with respect to the
citizenship of State Street, no opinion is expressed as to matters governed by
the Transportation Code or by any other law, statute, rule or regulation of
the United States relating to the acquisition, ownership, registration, use,
operation, maintenance, repair, replacement or sale of or the nature of the
Aircraft, Airframe or the Engines.
With your permission and without investigation, with respect to
paragraph 4 below in connection with our opinion relating to the legality,
validity, binding effect and enforceability of the documents there referred
to, to the extent that the laws of the Commonwealth of Massachusetts do not
govern such documents, we have assumed that the laws of the jurisdiction whose
laws govern such documents are not materially different from the internal
substantive laws of the Commonwealth of Massachusetts.
In rendering the opinion set forth below in paragraph 6 as to certain
Massachusetts tax matters, we have assumed that, for Federal income tax
purposes, the trusts created by the Series Supplements are not classified as
associations taxable as corporations and that the trusts created by the Series
Supplements are grantor trusts under subpart E, Part I of Subchapter J of
Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their respective successors and assigns in
connection with the transactions contemplated by the Operative Agreements and
may not be used or relied upon by any other person or for any other purpose.
Based upon the foregoing, we are of the opinion that:
1. State Street is a Massachusetts trust company, duly organized
and validly existing in good standing with the Massachusetts Commissioner of
Banks under the laws of the Commonwealth of Massachusetts, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has the full corporate power and authority to
execute, deliver and perform its obligations under the Pass Through Trustee
Documents and, in its capacity as Pass Through Trustee, to authenticate the
Pass Through Certificates delivered on the Refunding Date.
2. The execution and delivery of the Pass Through Trustee Documents
(other than the Pass Through Trust Agreement) by State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, and
compliance by State Street or the Pass Through Trustee, as the case may be,
individually or as Pass Through Trustee, with all of the provisions thereof do
not and will not contravene any Massachusetts or Federal law, rule or
regulation governing the banking or trust powers of State Street or the Pass
Through Trustee, or any order or judgment known to us, of any Massachusetts or
Federal court or governmental authority applicable to or binding on State
Street, individually or as Pass Through Trustee, or contravene the provisions
of, or constitute a default under, or result in the creation of a Lien on any
property of State Street or the Pass Through Trustee under, its charter
documents or By-Laws or any indenture, mortgage, chattel mortgage, deed of
trust, conditional sales contract, bank loan or credit agreement, in each case
known to us, or any other agreement or instrument, in each case known to us,
to which State Street, individually or as Pass Through Trustee, is a party or
by which it or any of its property may be bound or affected, other than the
Lien of the Indenture.
3. No order, license, consent, permit, authorization or approval
of or exemption by, and no notice to or filing with, or the taking of any
other action in respect of, any Massachusetts or Federal governmental
authority governing the banking or trust powers of State Street or the Pass
Through Trustee, and no filing, recording, publication or registration in any
public office is required under Massachusetts or Federal law pertaining to its
banking or trust powers for the due execution, delivery or performance by
State Street, individually or as Pass Through Trustee, as the case may be, of
the Pass Through Trustee Documents (other than the Pass Through Trust
Agreement) and of the certificate of authentication, as Pass Through Trustee,
on the Pass Through Certificates, or for the legality, validity, binding
effect or enforceability thereof against State Street or the Pass Through
Trustee, as the case may be.
4. Each of the Pass Through Trustee Documents (other than the Pass
Through Trust Agreement) has been duly authorized, executed and delivered by
State Street, in its individual capacity or as Pass Through Trustee, as the
case may be, and each such document constitutes a legal, valid and binding
obligation of State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, enforceable against State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, in
accordance with its terms.
5. The Pass Through Certificates have been duly authorized and
validly executed, issued, delivered and authenticated by the Pass Through
Trustee pursuant to the Pass Through Trust Agreement and the Series
Supplements; and the Pass Through Certificates are enforceable against the
Pass Through Trustee and the holders thereof are entitled to the benefits of
the Pass Through Trust Agreement and the related Series Supplements.
6. There are no fees, taxes or other governmental charges ("Taxes")
payable under the laws of the Commonwealth of Massachusetts with respect to the
execution and delivery by State Street, in its individual capacity or as Pass
Through Trustee, as the case may be, of any of the Pass Through Trustee
Documents (except for Taxes on any fees payable to State Street in its
individual capacity) which would not have been imposed if State Street did not
have its principal place of business in Massachusetts or did not perform its
administrative duties under the Pass Through Trustee Documents in
Massachusetts. Neither State Street, in its individual capacity or as the
Pass Through Trustee, as the case may be, the Owner Participant, the Owner
Trustee, nor the trusts created by the Series Supplements will, as a result of
the transactions contemplated thereby, be subject to any Taxes under the laws
of the Commonwealth of Massachusetts or any political subdivision thereof
(except for Taxes on any fees payable to State Street in its individual
capacity) which would not have been imposed if State Street did not have its
principal place of business in Massachusetts or did not perform its
administrative duties under the Pass Through Trustee Documents in
Massachusetts, and there are no Taxes under the laws of the Commonwealth of
Massachusetts or any political subdivision thereof (except for Taxes on any
fees payable to State Street in its individual capacity) upon or with respect
to the Aircraft or any Engine or any part of any interest therein, or the
purchase, ownership, delivery, lease, sublease, possession, presence, use,
operation, condition, storage, maintenance, modification, alteration, repair,
sale, return, transfer or other disposition of the Aircraft which would not
have been imposed if State Street did not have its principal place of business
in Massachusetts or did not perform its administrative duties under the Pass
Through Trustee Documents in Massachusetts. We express no opinion as to
whether or not any fees, tax or other charges are now or hereafter may be
payable by the Owner Participant to the Commonwealth of Massachusetts or any
political subdivision thereof in connection with (a) the execution, delivery,
or performance of the Series Supplements, the Participation Agreement or any
of the other Operative Agreements and (b) the making by the Owner Participant
of its investment in the Aircraft.
7. To the best of our knowledge, there are no pending or threatened
actions or proceedings against State Street before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of State Street, individually or
as Pass Through Trustee, to perform its obligations under the Pass Through
Trustee Documents.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
Ameritech Credit Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT B
[FORM OF LEASE AGREEMENT]
[See Exhibit 4.e]
EXHIBIT C
[FORM OF INDENTURE]
[See Exhibit 4.b.1]
EXHIBIT D
[FORM OF TRUST AGREEMENT]
[See Exhibit 4.d]
PARTICIPATION AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N662FE)
Dated as of September 1, 1996
Amended and Restated as of October 15, 1996
among
FEDERAL EXPRESS CORPORATION,
Lessee
PMCC LEASING CORPORATION,
Owner Participant
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK
BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION
THE CHASE MANHATTAN BANK
COMMERZBANK AG, ATLANTA AGENCY and
NATIONSBANK, N.A. (SOUTH),
Original Loan Participants
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Not in Its Individual Capacity
Except as Otherwise Expressly
Set Forth Herein, but Solely as Owner Trustee,
Owner Trustee
STATE STREET BANK AND TRUST COMPANY,
Indenture Trustee
and
STATE STREET BANK AND TRUST COMPANY,
Pass Through Trustee
______________________________
LEVERAGED LEASE OF ONE AIRBUS A300F4-605R AIRCRAFT
SERIAL NO. 761, REGISTRATION NO. N662FE
TABLE OF CONTENTS
Page
Initial Recitals........................................................... 1
ARTICLE 1
DEFINITIONS............................................................. 3
ARTICLE 2
Section 2.01. Transfer of Funds........................................ 3
Section 2.02. Certificates............................................. 6
ARTICLE 3
EXTENT OF INTEREST OF ORIGINAL LOAN PARTICIPANTS
Section 3.01. Extent of Interest of Original Loan Participants......... 6
ARTICLE 4
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent..................................... 7
Section 4.02. Opinion of Special Aviation Counsel...................... 16
ARTICLE 5
CONDITIONS PRECEDENT TO LESSEE'S OBLIGATIONS
Section 5.01. Conditions Precedent to Lessee's Obligations............. 16
ARTICLE 6
LESSEE'S REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 6.01. Lessee's Representations and Warranties.................. 16
Section 6.02. Offering by Lessee....................................... 22
Section 6.03. Certain Covenants of Lessee.............................. 23
Section 6.04. Survival of Representations and Warranties............... 30
ARTICLE 7
OTHER PARTIES' REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Acquisitions and Offerings of Interests in Lessor's
Estate.................................................. 31
Section 7.02. Citizenship.............................................. 31
Section 7.03. Representations, Warranties and Covenants of Owner
Participant............................................. 32
Section 7.04. Representations, Covenants and Warranties of FSB and the
Owner Trustee........................................... 37
Section 7.05. Representations, Warranties and Covenants of the Indenture
Trustee................................................. 40
Section 7.06. Indenture Trustee's Notice of Default.................... 42
Section 7.07. Releases from Indenture.................................. 42
Section 7.08. Covenant of Quiet Enjoyment.............................. 42
Section 7.09. Original Loan Participants' and Pass Through Trustee's
Representations and Warranties.......................... 42
Section 7.10. Survival of Representations, Warranties and Covenants.... 43
Section 7.11. Lessee's Assumption of the Certificates.................. 43
Section 7.12. Indebtedness of Owner Trustee............................ 45
Section 7.13. Compliance with Trust Agreement, Etc..................... 46
ARTICLE 8
TAXES
Section 8.01. Lessee's Obligation to Pay Taxes......................... 46
Section 8.02. After-Tax Basis.......................................... 52
Section 8.03. Time of Payment.......................................... 53
Section 8.04. Contests................................................. 53
Section 8.05. Refunds.................................................. 56
Section 8.06. Lessee's Reports......................................... 56
Section 8.07. Survival of Obligations.................................. 57
Section 8.08. Payment of Taxes......................................... 57
Section 8.09. Reimbursements by Indemnitees Generally.................. 57
Section 8.10. Obligations of Lessee Unsecured.......................... 57
ARTICLE 9
GENERAL INDEMNITY
Section 9.01. Generally................................................ 58
Section 9.02. After-Tax Basis.......................................... 61
Section 9.03. Subrogation.............................................. 62
Section 9.04. Notice and Payment....................................... 62
Section 9.05. Refunds.................................................. 62
Section 9.06. Defense of Claims........................................ 63
Section 9.07. Survival of Obligations.................................. 64
Section 9.08. Effect of Other Indemnities.............................. 64
Section 9.09. Interest................................................. 64
Section 9.10. Obligations of Lessee Unsecured.......................... 65
ARTICLE 10
TRANSACTION COSTS
Section 10.01. Transaction Costs and Other Costs....................... 65
ARTICLE 11
SUCCESSOR OWNER TRUSTEE
Section 11.01. Appointment of Successor Owner Trustee.................. 67
ARTICLE 12
LIABILITIES AND INTERESTS OF THE OWNER PARTICIPANT AND HOLDERS
Section 12.01. Liabilities of the Owner Participant.................... 68
Section 12.02. Interest of Holders of Certificates..................... 69
ARTICLE 13
OTHER DOCUMENTS
Section 13.01. Consent of Lessee to Other Documents.................... 69
Section 13.02. Further Assurances...................................... 69
Section 13.03. No Retroactive Application.............................. 69
Section 13.04. Pass Through Trustee's Acknowledgment................... 70
ARTICLE 14
NOTICES
Section 14.01. Notices................................................. 70
ARTICLE 15
REFINANCING/REOPTIMIZATION
Section 15.01. Refinancing............................................. 71
Section 15.02. Reoptimization.......................................... 74
ARTICLE 16
[INTENTIONALLY LEFT BLANK]
ARTICLE 17
MISCELLANEOUS
Section 17.01. Owner for Federal Tax Purposes.......................... 76
Section 17.02. [Intentionally Left Blank.]............................. 76
Section 17.03. Counterparts............................................ 76
Section 17.04. No Oral Modifications................................... 76
Section 17.05. Captions................................................ 77
Section 17.06. Successors and Assigns.................................. 77
Section 17.07. Concerning the Owner Trustee, Indenture Trustee and
the Pass Through Trustee............................... 77
Section 17.08. Severability............................................ 78
Section 17.09. Public Release of Information........................... 78
Section 17.10. Certain Limitations on Reorganization................... 78
Section 17.11. GOVERNING LAW........................................... 78
Section 17.12. Section 1110 Compliance................................. 79
ARTICLE 18
CONFIDENTIALITY
Section 18.01. Confidentiality......................................... 79
SCHEDULE I Certificate Information
SCHEDULE II Definitions
SCHEDULE III Permitted Country List
EXHIBIT A(1)(a) Opinion of Lessee's Counsel
EXHIBIT A(1)(b) Opinion of Lessee's Special Counsel
EXHIBIT A(2)(a) Opinion of Owner Participant's Special Counsel
EXHIBIT A(2)(b) Opinion of Owner Participant's Counsel
EXHIBIT A(3) Opinion of Indenture Trustee's Special Counsel
EXHIBIT A(4) Opinion of Special Aviation Counsel
EXHIBIT A(5) Opinion of Owner Trustee's Special Counsel
EXHIBIT A(6) Opinion of Pass Through Trustee's Special Counsel
EXHIBIT B Form of Lease Agreement
EXHIBIT C Form of Indenture
EXHIBIT D Form of Trust Agreement
EXHIBIT E-1 Form of Assignment and Assumption Agreement
EXHIBIT E-2 Form of Owner Participant Guaranty
PARTICIPATION AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N662FE)
PARTICIPATION AGREEMENT (FEDERAL EXPRESS CORPORATION TRUST NO.
N662FE) dated as of September 1, 1996, as amended and restated as of October
15, 1996 (this "Agreement") among FEDERAL EXPRESS CORPORATION, a Delaware
corporation (herein, together with its successors and permitted assigns, the
"Lessee"), PMCC LEASING CORPORATION, a Delaware corporation (herein, together
with its successors and permitted assigns, the "Owner Participant"), ▇▇▇▇▇▇
GUARANTY TRUST COMPANY OF NEW YORK, BANK OF AMERICA NATIONAL TRUST & SAVINGS
ASSOCIATION, THE CHASE MANHATTAN BANK, COMMERZBANK AG, ATLANTA AGENCY and
NATIONSBANK, N.A. (SOUTH), (individually, together with its successors and
permitted assigns, an "Original Loan Participant" and collectively the
"Original Loan Participants"), FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity, except as
otherwise expressly stated herein, but solely as owner trustee under the Trust
Agreement referred to below (in such capacity as trustee, together with its
successors and permitted assigns, the "Owner Trustee"), STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company, not in its individual capacity,
except as otherwise expressly stated herein, but solely as indenture trustee
under the Indenture referred to below (in such capacity as trustee, together
with its successors and permitted assigns, the "Indenture Trustee") and STATE
STREET BANK AND TRUST COMPANY, a Massachusetts trust company, not in its
individual capacity, except as otherwise expressly stated herein, but solely
as pass through trustee (in such capacity as trustee, together with its
successors and permitted assigns, the "Pass Through Trustee").
W I T N E S S E T H :
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee entered into the Original
Participation Agreement (such term, and all other terms not heretofore
defined, shall have the meanings assigned thereto as provided in Article 1
below), providing for the sale and lease of the Aircraft that was delivered on
the Delivery Date;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Participant entered into the Original Trust
Agreement relating to the Aircraft with FSB in its individual capacity,
pursuant to which FSB agreed, among other things, to hold the Lessor's Estate
in trust for the benefit of the Owner Participant;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Trustee and the Indenture Trustee entered
into the Original Indenture, for the benefit of the Original Loan
Participants, pursuant to which the Owner Trustee issued to the Original Loan
Participants the Original Loan Certificates as evidence of the loans made by
the Original Loan Participants to the Owner Trustee, the proceeds of which
were used by the Owner Trustee to pay a portion of the Purchase Price for the
Aircraft;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Trustee and the Lessee entered into the
Original Lease relating to the Aircraft, whereby, subject to the terms and
conditions set forth in said Lease, the Owner Trustee agreed to lease the
Aircraft to the Lessee, and the Lessee agreed to lease the Aircraft from the
Owner Trustee, such lease of the Aircraft being evidenced by the execution and
delivery of the Lease Supplement;
WHEREAS, Article 15 of the Original Participation Agreement permits a
Refinancing of the Original Loan Certificates subject to the satisfaction of
the conditions specified in Section 15.01 thereof, and Section 3.04 of the
Original Lease contemplates the adjustment of the percentages for Basic Rent,
Stipulated Loss Value and Termination Value in the event of such a
Refinancing, and the Lessee has requested that the Owner Trustee effect such a
Refinancing and adjustment;
WHEREAS, in order to facilitate such Refinancing, the Lessee is
concurrently entering into an Underwriting Agreement, which relates to two
series of Pass Through Certificates that will be issued by the Pass Through
Trusts formed to acquire, among other securities, the Certificates bearing a
particular interest rate and having a particular Maturity that will be issued
under the Indenture;
WHEREAS, on the Pass Through Closing Date, a closing will occur with
respect to the public offering of the Pass Through Certificates issued by each
Pass Through Trust, an allocable amount of the proceeds of which offering will
be used by the Pass Through Trustee to purchase for each such Pass Through
Trust the Certificates of the interest rate and Maturity applicable thereto,
the proceeds of which purchase in turn will be applied to the Refinancing in
full of the outstanding principal amount of the Original Loan Certificates;
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have agreed, subject to
the terms and conditions hereinafter provided, to amend and restate, and to
add the Pass Through Trustee as a party to, the Original Participation
Agreement; and
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have agreed, to the
extent they are parties thereto and, subject to the terms and conditions
hereinafter provided, to amend and restate the Original Indenture, to amend
and restate the Original Lease, to amend and restate the Original Ancillary
Agreement I, to amend the Original Tax Indemnity Agreement and to amend and
restate the Original Trust Agreement, each such amendment and restatement to
be executed and delivered simultaneously with the purchase of the Certificates
by the Pass Through Trustee for the Pass Through Trusts and the Refinancing in
full of the Original Loan Certificates.
NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereto agree, subject to the terms and
conditions hereinafter provided, that the Original Participation Agreement be
and the same is hereby amended and restated in its entirety as follows:
ARTICLE 1
DEFINITIONS
Unless otherwise specifically provided herein, the definitions set
forth in Schedule II hereto are incorporated herein for all purposes of this
Agreement and shall be equally applicable to both the singular and the plural
forms of the terms so defined.
ARTICLE 2
ISSUANCE OF PASS THROUGH CERTIFICATES;
REFUNDING THE ORIGINAL LOAN CERTIFICATES
Section 2.01. Transfer of Funds.
(a) On or before the Pass Through Closing Date, the Pass Through
Trustee and the Lessee, in accordance with the Pass Through Agreement, shall
enter into the Series Supplements, and, subject to the terms and conditions
set forth therein, on the Pass Through Closing Date (i) the Lessee shall
direct the Underwriters to execute a wire transfer or intra-bank transfer to
the Pass Through Trustee in the amount of the total proceeds payable pursuant
to the Underwriting Agreement with respect to the Pass Through Certificates
and (ii) the Pass Through Trustee shall deliver the Pass Through Certificates
to the Underwriters upon receipt by the Pass Through Trustee of such proceeds.
(b) Subject to the satisfaction or waiver of the conditions set
forth herein, on the Refunding Date the following events shall occur in the
order set forth below:
(i) the Lessee shall on behalf of the Owner Trustee execute a wire
transfer or intra-bank transfer in favor of the Agent in the amount of all
accrued and unpaid interest on the Original Loan Certificates to but
excluding the Refunding Date, which transfer shall constitute the payment
of a like amount of such accrued and unpaid interest;
(ii)the Lessee shall on behalf of the Owner Trustee execute a wire
transfer or intra-bank transfer in favor of the Agent as Supplemental Rent
in the amount of any Breakage Costs required to be paid pursuant to the
Original Indenture which transfer shall constitute the payment of all such
Breakage Costs;
(iii)for each Pass Through Trust, from an allocable amount of the
proceeds of the sale of the related Pass Through Certificates, the Pass
Through Trustee shall pay on behalf of the Owner Trustee in the manner
specified in paragraph (iv) below, an amount equal to the principal amount
of Certificates of the Maturity and having the interest rate that relates
to such Pass Through Trust, which amounts in the aggregate shall equal the
aggregate principal amount of the Certificates as specified in Section 2.04
of the Indenture;
(iv)the aggregate amount payable by the Pass Through Trustee pursuant
to paragraph (iii) above shall be payable by wire transfer or intra-bank
transfer in favor of the Agent on behalf of the Owner Trustee in the amount
of the outstanding principal amount of the Original Loan Certificates;
(v) the Agent shall apply the amounts received by it under paragraphs
(i), (ii) and (iv) of this subsection (b) to prepay the Original Loan
Certificates in full in accordance with Sections 2.06 and 2.10 of the
Original Indenture; and
(vi)the Owner Trustee shall cause the Certificates to be delivered to
the applicable Pass Through Trustee in accordance with Section 2.02 hereof.
On the Refunding Date concurrently with the events specified in
clauses (iii) through (v) of this Section 2.01(b), the parties hereto shall
execute and deliver, to the extent they are parties thereto, and consent to
the execution and delivery of (if they are not a party thereto), the
Indenture, the Lease and the Trust Agreement, and the Owner Trustee shall
execute and deliver to the Indenture Trustee for authentication, and the
Indenture Trustee shall authenticate and deliver to the applicable Pass Through
Trustee, upon the request of the Owner Trustee, the Certificates as provided
in Section 2.02 hereof. The Owner Participant hereby requests and directs the
Owner Trustee to execute and deliver this Agreement and, subject to the terms
hereof, to take the actions specified herein. The Original Loan Participants
by their execution and delivery hereof, request and direct the Indenture
Trustee to execute and deliver this Agreement and concurrently with the events
specified in clauses (iii) through (v) of this Section 2.01(b) and subject to
the terms and conditions hereof to take the actions contemplated herein. The
parties hereto, including, without limitation, the Original Loan Participants,
confirm that, as provided in Section 2.06 of the Original Indenture, upon
payment in full of the principal amount, Breakage Costs, if any, and interest
on the Original Loan Certificates and all other sums then payable to the
Original Loan Participants under the Original Agreements to the extent
specified in subsection (c) below, the Original Loan Participants shall have
no further interest in, or other right or obligation with respect to, the
Trust Indenture Estate, the Original Agreements or the Operative Agreements
(it being understood that the foregoing shall not limit or detract from any
claim that any Original Loan Participant may have under Article 8 or 9 or
Section 10.01(a)(ii) hereof or of the Original Participation Agreement) and,
accordingly, have no obligation to, and will not attempt to direct any future
actions of the Indenture Trustee with respect to the Trust Indenture Estate,
provided that the rights and obligations of the Original Loan Participants
shall, until the payment in full of such amounts to the Agent on behalf of the
Original Loan Participants on the Refunding Date, be governed by the Original
Participation Agreement and the other Operative Agreements contemplated
thereby or in effect immediately prior to the effectiveness of this Agreement
and shall, upon such payment and thereafter, be governed by this Agreement.
The Lessee hereby consents to the foregoing.
(c) Not less than four (4) Business Days prior to the Refunding
Date, the Agent on behalf of the Original Loan Participants shall give notice
in writing to the parties hereto of the principal amount, Breakage Costs, if
any, and interest on and all other amounts due on the Refunding Date under the
Original Loan Certificates and all other sums payable on the Refunding Date to
the Original Loan Participants under the Original Agreements, such notice to
be deemed final and binding on the Original Loan Participants as to the
respective amounts of principal, Breakage Costs, if any, and interest when
given; provided that the expected Refunding Date, at the time such notice is
given, is the same as the Refunding Date.
(d) On the Refunding Date, subject to (i) the giving of the written
notice referred to in Section 2.01(c) above to the Indenture Trustee and the
Original Loan Participants, (ii) the receipt by the Original Loan Participants
of the funds referred to in Section 2.01(b)(v) above and (iii) compliance with
the provisions of Article 15 of the Original Participation Agreement and
Section 2.10(c) of the Original Indenture (including the Refinancing in full
of the Original Loan Certificates), the Original Loan Participants shall
deliver the Original Loan Certificates to the Indenture Trustee for
cancellation and delivery to the Owner Trustee.
(e) The closing with respect to the acquisition of the Pass Through
Certificates by the Underwriters and the closing with respect to the
Refinancing of the Original Loan Certificates (together, the "Closings") shall
take place at the offices of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
(f) All payments pursuant to this Section 2.01 shall be made in
immediately available funds.
(g) In the event that the Refunding Date and the actions
contemplated to occur on such date pursuant to subsection (d) of this Section
2.01 do not occur on or before November 30, 1996, then the rights and
obligations of the parties to the Original Participation Agreement, including,
without limitation, the Original Loan Participants, shall be governed by the
Original Participation Agreement and the other Operative Agreements
contemplated thereby or in effect immediately prior to the effectiveness of
this Agreement and this Agreement shall be of no further force and effect,
except that the Lessee shall be obligated hereby to pay all fees and expenses
of the Original Loan Participants, the Indenture Trustee, the Owner
Participant, the Owner Trustee, the Pass Through Trustee and their respective
counsel relating to the transactions contemplated hereby. Each of the parties
hereto agrees to execute and deliver to the other parties such documents and
instruments as may be necessary to give effect to the foregoing provisions of
this subsection (g).
Section 2.02. Certificates. Subject to the satisfaction or waiver
of the conditions set forth herein, on the Refunding Date, the Owner Trustee
shall execute and deliver to the Indenture Trustee, and the Indenture Trustee
shall authenticate and deliver, upon the request of the Owner Trustee, to the
Pass Through Trustee for each Pass Through Trust, the Certificate specified
for such Pass Through Trust on Schedule I attached hereto, which (i) shall be
issued in the principal amount and in the Maturity set forth for such
Certificate in Schedule I hereto, (ii) shall bear interest at the interest
rate set forth for such Certificate in Schedule I hereto, (iii) shall be
issued in such form and on such terms as are specified in the Indenture, (iv)
shall be dated and authenticated on the Refunding Date and shall bear interest
from the Refunding Date and (v) shall be registered in the name of the Pass
Through Trustee on behalf of such Pass Through Trust.
ARTICLE 3
EXTENT OF INTEREST OF ORIGINAL LOAN PARTICIPANTS
Section 3.01. Extent of Interest of Original Loan Participants.
Delivery of the Original Loan Certificates by the Original Loan Participants
to the Indenture Trustee for cancellation on the Refunding Date shall be
conclusive evidence of receipt by the Original Loan Participants of all
amounts then due and payable to the Original Loan Participants in respect of
principal of, Breakage Costs, if any, and interest on the Original Loan
Certificates under the Original Agreements (it being understood that the
foregoing shall not limit or detract from any claim any Original Loan
Participant may have under Article 8 or 9 or Section 10.01(a)(ii) hereof or of
the Original Participation Agreement).
ARTICLE 4
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent. The obligations of the Owner
Trustee, the Owner Participant, the Indenture Trustee and the Pass Through
Trustee on behalf of each Pass Through Trust to participate in the
transactions contemplated hereby on the Refunding Date are subject to the
fulfillment to the satisfaction of such party (or waiver by such party), prior
to or on the Refunding Date, of the following conditions precedent (it being
understood that receipt by the Lessee of any of the following documents shall
not be a condition precedent to the obligations of any party):
(a) Certificates. On the Refunding Date, there shall have been duly
issued and delivered by the Owner Trustee to the Pass Through Trustee for
each Pass Through Trust, against payment therefor, a Certificate,
substantially in the form set forth in Exhibit B to the Indenture, duly
authenticated, dated the Refunding Date and registered in the name of the
Pass Through Trustee on behalf of such Pass Through Trust, in the principal
amounts, Maturity, bearing the interest rate and the other economic terms
specified in the Series Supplements and otherwise as provided in Section
2.04 of the Indenture. The Pass Through Certificates shall be registered
under the Securities Act, any applicable state securities laws shall have
been complied with, and the Pass Through Agreement shall have been qualified
under the Trust Indenture Act.
(b) Legal Investment. On the Refunding Date, no fact or condition
shall exist under applicable laws or regulations, or interpretations of any
such laws or regulations by applicable regulatory authorities, which, in
the opinion of the Owner Participant or its special counsel, the Pass
Through Trustee or the Indenture Trustee or their special counsel, would
make it illegal for the Owner Participant, the Lessee, the Owner Trustee,
the Pass Through Trustee or the Indenture Trustee, and no change in
circumstances shall have occurred which would otherwise make it illegal or
otherwise in contravention of guidance issued by regulatory authorities for
the Owner Participant, the Lessee, the Owner Trustee, the Pass Through
Trustee or the Indenture Trustee, to participate in the transaction to be
consummated on the Refunding Date; and no action or proceeding shall have
been instituted nor shall governmental action before any court,
governmental authority or agency be threatened which in the opinion of
counsel for the Owner Participant, the Indenture Trustee or the Pass
Through Trustee is not frivolous, nor shall any order have been issued or
proposed to be issued by any court, or governmental authority or agency,
as of the Refunding Date, to set aside, restrain, enjoin or prevent the
consummation of any of the transactions contemplated by this Agreement or by
any of the other Operative Agreements.
(c) Underwriters. The Underwriters shall have transferred the funds
specified in Section 2.01(a) hereof and all conditions thereunder shall
have been satisfied or waived.
(d) Refunding Documents. This Agreement and the following documents
shall have been duly authorized, executed and delivered by the respective
party or parties thereto, shall each be satisfactory in form and substance
to the Lessee, the Owner Trustee, the Indenture Trustee, the Pass Through
Trustee and the Owner Participant (each acting directly or by authorization
to its special counsel) and shall each be in full force and effect; there
shall not have occurred any default thereunder, or any event which with the
lapse of time or the giving of notice or both would be a default
thereunder, and copies executed or certified as requested by the Lessee,
the Owner Trustee, the Indenture Trustee, the Pass Through Trustee or the
Owner Participant, as the case may be, of such documents shall have been
delivered to the Owner Participant, the Lessee, the Indenture Trustee, the
Pass Through Trustee and the Owner Trustee (provided that the sole
chattel-paper original of each of the Lease, the Lease Supplement and each
Ancillary Agreement amendatory of the Lease, shall be delivered to the
Indenture Trustee):
(i) the Lease;
(ii) the Indenture;
(iii) in the case of the Owner Participant only, Amendment No. 1 to
the Original Tax Indemnity Agreement;
(iv) the Trust Agreement;
(vi) the Ancillary Agreement I; and
(vii) the Ancillary Agreement II.
(e) Insurance. Each of the Indenture Trustee, the Pass Through
Trustee, the Owner Trustee and the Owner Participant shall have received
such evidence as it deems appropriate, including, without limitation, an
independent insurance broker's report, together with certificates of
insurance from such broker, in form and substance satisfactory to the
Indenture Trustee, the Pass Through Trustee, the Owner Trustee and the
Owner Participant to establish that the insurance required by Article 13 of
the Lease is in effect.
(f) Financing Statements. (i) Uniform Commercial Code ("UCC")
financing statements covering all the security interests (and other
interests) created by or pursuant to the Granting Clause of the Original
Indenture shall have been executed and delivered by the Owner Trustee, as
debtor, and by the Indenture Trustee, as secured party, for and on behalf
of the Original Loan Participants, and such financing statements shall have
been duly filed in the State of Utah; (ii) a form UCC-3 financing statement
to amend and restate each financing statement referred to in the
immediately preceding sentence shall have been executed and delivered by
the Owner Trustee, as debtor, and by the Indenture Trustee as secured
party, and a form UCC-1 financing statement covering all the security
interests (and other interests) created by or pursuant to the Granting
Clause of the Indenture shall have been executed and delivered by the Owner
Trustee, as debtor, and by the Indenture Trustee, as secured party, for and
on behalf of the Holders, and concurrently with the Refinancing of the
Original Loan Certificates such UCC-3 financing statement and UCC-1
financing statement shall have been duly filed or duly submitted for filing
in the State of Utah, and all other actions shall have been taken which, in
the opinion of special counsel for the Pass Through Trustee or for the
Underwriters, are necessary or desirable to maintain the perfection of the
security interest created by or pursuant to the Granting Clause of the
Indenture; (iii) a UCC notice filing describing the Original Lease as a
lease shall have been executed and delivered by the Owner Trustee, as
lessor, and the Lessee, as lessee (which filing shall name the Indenture
Trustee as assignee of the Owner Trustee), and shall have been duly filed
in the State of Tennessee; and (iv) a form UCC-3 financing statement to
amend and restate the UCC notice filing referred to in the immediately
preceding clause (iii) shall have been executed and delivered by the Owner
Trustee, as lessor, and by the Lessee, as lessee (which filing shall name
the Indenture Trustee as assignee of the Owner Trustee), and such notice
filing shall concurrently with the Refinancing of the Original Loan
Certificates have been duly filed in the State of Tennessee, and all other
actions shall have been taken which, in the opinion of the Owner
Participant, Pass Through Trustee and the Underwriters, are necessary to
perfect and protect such security interests and other interests created by
or pursuant to the Granting Clause of the Indenture.
(g) Corporate Documents. Except when such Person is the delivering
party, the Owner Participant, the Owner Trustee, the Original Loan
Participants, the Pass Through Trustee, the Lessee and the Indenture
Trustee (acting directly or by authorization to its counsel) shall have
received the following, in each case in form and substance satisfactory to
it:
(i) a copy of the certificate of incorporation and by-laws of
the Lessee, certified by the Secretary or an Assistant Secretary of
the Lessee as of the Refunding Date, and a copy of the minutes of the
regular meeting of the board of directors of the Lessee, certified as
such as of the Refunding Date by such Secretary or Assistant
Secretary, duly authorizing the lease by the Lessee of the Aircraft
under the Lease and the execution, delivery and performance by the
Lessee of the Original Agreements to which it is a party, this
Agreement, the Lease, the Tax Indemnity Agreement, the Pass Through
Agreement, the Series Supplements, the other Operative Agreements to
which the Lessee is or is to be a party and each other document to be
executed and delivered by the Lessee in connection with the
transactions contemplated hereby;
(ii) a copy of the articles of incorporation and bylaws of the
Owner Participant, certified by the Secretary or an Assistant
Secretary of the Owner Participant as of the Refunding Date, and a
copy of the resolutions of the board of directors of the Owner
Participant, certified as such as of the Refunding Date by such
Secretary or an Assistant Secretary, authorizing the execution and
delivery by the Owner Participant of the Original Agreements to which
it is a party, this Agreement, the Tax Indemnity Agreement, the Trust
Agreement and the other Operative Agreements to which the Owner
Participant is or is to be a party and each other document to be
executed and delivered by the Owner Participant in connection with
the transactions contemplated hereby;
(iii) a copy of the articles of association and by-laws and
other instruments of the Owner Trustee, certified by the Secretary or
an Assistant Secretary of the Owner Trustee as of the Refunding Date
(or other like instruments satisfactory to the Lessee and the Owner
Participant) and evidence authorizing the execution, delivery and
performance by the Owner Trustee in its individual capacity or as
Owner Trustee, as the case may be, of the Original Agreements to
which it is a party, this Agreement, the Trust Agreement and each of
the other Operative Agreements to which it is or is to be a party,
whether in its individual capacity or as Owner Trustee, and each
other document to be executed and delivered by the Owner Trustee in
connection with the transactions contemplated hereby;
(iv) a copy of the certificate of incorporation and by-laws
and other instruments of the Indenture Trustee, certified by the
Secretary or an Assistant Secretary of the Indenture Trustee as of
the Refunding Date (or other like instruments satisfactory to the
Lessee and the Owner Participant) and evidence authorizing the
execution, delivery and performance by the Indenture Trustee of each
of the Original Agreements to which it is party, this Agreement, the
Indenture and each of the other Operative Agreements to which it is
or is to be a party, and each other document to be executed and
delivered by the Indenture Trustee in connection with the transactions
contemplated hereby;
(v) a copy of the certificate of incorporation and by-laws
and other instruments of the Pass Through Trustee, certified by the
Secretary or an Assistant Secretary of the Pass Through Trustee as of
the Refunding Date (or other like instruments satisfactory to the
Lessee and the Owner Participant) and evidence authorizing the
execution, delivery and performance by the Pass Through Trustee of
this Agreement, the Pass Through Agreement, the Series Supplements
and each of the other Operative Agreements to which it is or is to be
a party, and each other document to be executed and delivered by the
Pass Through Trustee in connection with the transactions contemplated
hereby; and
(vi) such other documents, evidences, materials, and
information with respect to the Lessee, the Owner Trustee, the
Indenture Trustee, the Pass Through Trustee and the Owner Participant
as the Indenture Trustee, the Pass Through Trustee or the Owner
Participant may reasonably request in order to establish the
consummation of the transactions contemplated by this Agreement.
(h) Title, Airworthiness and Registration. On the Refunding Date,
the following statements shall be true, and the Owner Participant, the
Owner Trustee, the Pass Through Trustee and the Indenture Trustee shall
have received evidence from the Lessee reasonably satisfactory to each such
Person to the effect that:
(i) the Owner Trustee has good and marketable title to the
Aircraft, free and clear of Liens, except the rights of the Owner
Trustee and the Lessee under the Lease and the Lease Supplement
covering the Aircraft, the rights of the Indenture Trustee under the
Indenture and the beneficial interest of the Owner Participant
created by the Trust Agreement and the interest of the Holders
created by the Indenture and the Indenture and Security Agreement
Supplement covering the Aircraft;
(ii) the Aircraft has been duly certificated by the Aeronautics
Authority as to type and airworthiness in accordance with the terms
of the Operative Agreements;
(iii) the Lease, the Indenture and the Trust Agreement
concurrently with the Refinancing of the Original Loan Certificates
have been duly filed for recordation (or shall be in the process of
being so duly filed for recordation) with the Aeronautics Authority
pursuant to the Transportation Code; and
(iv) the Aircraft is registered in the name of the Owner
Trustee.
(i) Officer's Certificate of Lessee. On the Refunding Date, the
following statements shall be true, and the Owner Participant, the Owner
Trustee, the Pass Through Trustee and the Indenture Trustee shall have
received a certificate signed by the Vice President and Treasurer or any
other duly authorized officer of the Lessee, dated the Refunding Date,
stating that:
(i) the representations and warranties of the Lessee
contained in the Operative Agreements to which it is a party
(excluding the Tax Indemnity Agreement) and in any certificate
delivered pursuant hereto or thereto are true and correct on and as
of the Refunding Date 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 certificate shall state that
such representations and warranties were true and correct on and as
of such earlier date);
(ii) except for the matters described (i) under "Legal
Proceedings" in the Lessee's Annual Report on Form 10-K for the
fiscal year ended May 31, 1996 (as updated by Note 7 to the financial
statements included in the Lessee's Quarterly Report on Form 10-Q for
the fiscal quarter ended August 31, 1996) and (ii) in the Lessee's
Current Reports on Form 8-K dated June 7, 1996 and August 16, 1996,
as to which such officer will make no certification concerning the
liability of the Lessee (if any), or the effect of any adverse
determination upon the consolidated financial condition, business or
operations of the Lessee, no material adverse change has occurred in
the financial condition, business or operations of the Lessee from
that shown in the audited financial statements of the Lessee as of
May 31, 1995 or the unaudited consolidated financial statements of
the Lessee as of August 31, 1996 and nothing has occurred which will,
in the judgment of such officer, materially adversely affect the
ability of the Lessee to carry on its business or to perform its
obligations under this Agreement and each other Operative Agreement
to which it is or is to be a party; and
(iii) no event has occurred and is continuing, or would result
from the purchase, sale, mortgage, or lease of the Aircraft, which
constitutes an Event of Loss (or event which with the passage of time
would become an Event of Loss) with respect to the Airframe or any
Engine, or a Default or an Event of Default under the Lease.
(j) Officer's Certificate of Owner Participant. On the Refunding
Date, the following statements shall be true, and the Lessee, the Pass
Through Trustee, the Owner Trustee and the Indenture Trustee shall have
received a certificate from the Owner Participant, signed by a duly
authorized officer of the Owner Participant dated the Refunding Date,
stating that:
(i) the representations and warranties of the Owner
Participant contained in this Agreement, the Trust Agreement and any
other Operative Agreement to which it is a party (excluding the Tax
Indemnity Agreement) and in any certificate delivered pursuant hereto
or thereto, are true and correct on and as of the Refunding Date 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 certificate shall state that such representations and
warranties were true and correct on and as of such earlier date);
(ii) no Lessor's Liens attributable to the Owner Participant
exist; and
(iii) no event has occurred and is continuing which constitutes
or, with notice or lapse of time or both would constitute, due to any
action or omission on the part of the Owner Participant, an Indenture
Event of Default other than an Indenture Event of Default
attributable to a Lease Event of Default.
(k) Other Officer's Certificates. On the Refunding Date, the
following statements shall be true, and the Owner Participant, the Lessee,
the Pass Through Trustee, the Owner Trustee and the Indenture Trustee shall
have received a certificate from each of FSB and the Owner Trustee (in the
case of the Lessee, the Pass Through Trustee, the Owner Participant and the
Indenture Trustee), SSB and the Indenture Trustee (in the case of the
Lessee, the Pass Through Trustee, the Owner Participant and the Owner
Trustee) and SSB and the Pass Through Trustee (in the case of the Lessee,
the Indenture Trustee, the Owner Participant and the Owner Trustee) signed
by a duly authorized officer of FSB and SSB, respectively, dated the
Refunding Date, stating with respect to FSB and the Owner Trustee, with
respect to SSB and the Indenture Trustee, or with respect to SSB and the
Pass Through Trustee, as the case may be, that:
(i) the representations and warranties of FSB in its
individual capacity and as Owner Trustee, of SSB in its individual
capacity and as Indenture Trustee and of SSB in its individual
capacity and as Pass Through Trustee contained in this Agreement, the
Lease, the Trust Agreement and the Indenture and in any certificate
delivered pursuant hereto or thereto are true and correct on and as
of the Refunding Date 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 certificate shall state that
such representations and warranties were true and correct on and as
of such earlier date);
(ii) to the best of its knowledge, no event has occurred and is
continuing, which constitutes or which, but for the lapse of time or
the giving of notice, or both, would constitute, due to any action or
omission on the part of FSB in its individual capacity or as Owner
Trustee, of SSB in its individual capacity or as Indenture Trustee
and of SSB in its individual capacity or as Pass Through Trustee, an
Event of Default or an Indenture Event of Default; and
(iii) there are no Lessor's Liens attributable to the Owner
Trustee or FSB and no Indenture Trustee's Liens affecting the Trust
Indenture Estate or the Lessor's Estate or any part thereof.
(l) Legal Opinions. The Owner Participant, the Agent, the Original
Loan Participants, the Underwriters, the Lessee, the Owner Trustee, the
Pass Through Trustee and the Indenture Trustee (acting directly or by
authorization to its special counsel) shall have received from the
following counsel their respective legal opinions in each case satisfactory
to the Owner Participant, the Agent, the Original Loan Participants, the
Underwriters, the Lessee, the Owner Trustee, the Pass Through Trustee or
the Indenture Trustee, as the case may be, as to scope and substance (and
covering such other matters as the recipient may reasonably request) and
dated the Refunding Date:
(i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Law of the Lessee, in
the form of Exhibit A(1)(a) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Owner Trustee, the Pass Through Trustee and the Indenture Trustee;
(ii) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Owner
Participant, in the form of Exhibit A(2)(a) hereto and the General
Counsel's Office of the Owner Participant, in the form of Exhibit
A(2)(b) hereto, each addressed to the Agent, the Original Loan
Participants, the Underwriters, the Owner Participant, the Indenture
Trustee, the Owner Trustee, the Pass Through Trustee and the Lessee;
(iii) ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel for the
Indenture Trustee, in the form of Exhibit A(3) hereto and addressed
to the Agent, the Original Loan Participants, the Underwriters, the
Owner Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee;
(iv) ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special aviation counsel,
in the form of Exhibit A(4) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Lessee;
(v) Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel for the Owner
Trustee, in the form of Exhibit A(5) hereto and addressed to the
Agent, the Original Loan Participants, the Underwriters, the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee;
(vi) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Lessee, in
the form of Exhibit A(1)(b) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Lessee; and
(vii) ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel for the Pass
Through Trustee, in the form of Exhibit A(6) hereto and addressed to
the Agent, the Original Loan Participants, the Underwriters, the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee.
(m) No Indenture Event of Default. No Indenture Event of Default or
Indenture Default has occurred and is continuing.
(n) Event of Default; Default; Event of Loss. No Default or Event
of Default under the Lease or Event of Loss or event, which with the
passage of time or if continued unremedied or unaltered would constitute an
Event of Loss, shall have occurred or be in existence.
(o) Cancellation. Following the Refinancing of the Original Loan
Certificates, the Original Loan Certificates shall have been duly delivered
by the Original Loan Participants to the Indenture Trustee for cancellation
and delivery to the Owner Trustee.
(p) Other Agreements. The Lessee and the Pass Through Trustee shall
have entered into the Pass Through Agreement and the Series Supplements, all
conditions to the effectiveness of each thereof shall have been satisfied
or waived, and the Pass Through Certificates shall have been issued
pursuant to the Series Supplements. The Lessee and the Underwriters shall
have entered into the Underwriting Agreement, all conditions to the
effectiveness thereof shall have been satisfied or waived, and the Pass
Through Certificates shall have been delivered pursuant to the Underwriting
Agreement.
(q) Notice, Etc. The Owner Trustee, the Owner Participant, the
Lessee, the Indenture Trustee and the Pass Through Trustee shall have
received a refunding notice pursuant to Section 2.01(c) hereof.
(r) Payment of Taxes. (A) All taxes, fees, charges, assessments,
costs and other expenses then due and payable in connection with the
execution, delivery, recording and filing of all financing statements and
the documents and instruments referred to in subparagraph (f) of this
Section 4.01; and (B) all sales or use taxes and duties related to the
consummation of the transactions contemplated by the Operative Agreements
then due and payable shall have been duly paid in full.
(s) Governmental Compliance. All appropriate action required to have
been taken by the FAA, or any governmental or political agency, subdivision
or instrumentality of the United States, prior to the Refunding Date in
connection with the transactions contemplated by this Agreement shall have
been taken, and all orders, permits, waivers, authorizations, exemptions
and approvals (collectively "permits") of such entities required to be in
effect on the Refunding Date in connection with the transactions
contemplated by this Agreement shall have been issued, and all such permits
shall be in full force and effect on the Refunding Date.
(t) Compliance with Original Participation Agreement. All conditions
precedent set forth in Section 15.01 of the Original Participation
Agreement shall be met to the satisfaction of the Owner Participant.
Section 4.02. Opinion of Special Aviation Counsel. Promptly upon
the filing and, where appropriate, recording of the documents specified in
4.01(h)(iii) hereof, pursuant to the Transportation Code the Lessee shall
cause Special Aviation Counsel to deliver to the Owner Participant, the Owner
Trustee, the Pass Through Trustee and the Indenture Trustee an opinion as to
(i) the due recording of such documents and the documents identified in
Section 4.01(i) of the Original Participation Agreement and (ii), subject to
customary qualifications, the lack of any intervening documents with respect
to the Aircraft.
ARTICLE 5
CONDITIONS PRECEDENT TO LESSEE'S OBLIGATIONS
Section 5.01. Conditions Precedent to Lessee's Obligations. The
Lessee's obligation to participate in the transactions contemplated hereby is
subject to the conditions that, prior to or on the Refunding Date, the Lessee
shall have received the certificates and other documents which are referred to
in, or the opinions to be addressed to it under, as the case may be,
paragraphs (d), (g)(ii)-(v), (h)(ii)-(iv), (j), (k) and (l)(ii), (iii), (iv),
(v), (vi) and (vii) of Section 4.01 hereof and the Underwriters and the Owner
Participant shall have made available the amounts required to be paid by them
pursuant to Section 2.01 hereof.
ARTICLE 6
LESSEE'S REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 6.01. Lessee's Representations and Warranties. The Lessee
represents and warrants to the Owner Participant, the Owner Trustee (in its
individual capacity and as Owner Trustee), the Pass Through Trustee (in its
individual capacity and as Pass Through Trustee) and the Indenture Trustee (in
its individual capacity and as Indenture Trustee) that, on the date hereof and
as of the Refunding Date:
(a) the Lessee is a corporation duly organized and validly existing
and is in good standing under the laws of the State of Delaware with its
principal place of business and chief executive office (as such terms are
used in Article 9 of the Uniform Commercial Code) in Memphis, Tennessee,
and is duly qualified to do business as a foreign corporation and is in
good standing in all jurisdictions in which it has intrastate routes, or
offices or major overhaul facilities or in which other activities of the
Lessee require such qualification;
(b) the Lessee has full power, authority and legal right to conduct
its business and operations as currently conducted and to own or hold under
lease its Properties and to enter into and perform its obligations under
this Agreement, the Original Agreements to which it is a party, the other
Operative Agreements to which it is a party, the Pass Through Agreement and
the Series Supplements (the "Lessee Documents");
(c) the Lessee is an "air carrier" within the meaning of the
Transportation Code and a holder of a certificate under Sections 41102(a)
and 41103 of the Transportation Code and a "citizen of the United States"
within the meaning of Section 40102(a)(15) of the Transportation Code
holding an "air carrier operating certificate" issued under Chapter 447 of
the Transportation Code for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, and each such certificate is
in full force and effect;
(d) the Lessee possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents (collectively
"permits") which are material to the operation of the routes flown by it
and the conduct of its business and operations as currently conducted and
each such permit is in full force and effect;
(e) the execution, delivery and performance of the Lessee Documents
by the Lessee have been duly authorized by all necessary corporate action
on the part of the Lessee and do not require any stockholder approval, or
approval or consent of any trustee or holder of any indebtedness or
obligations of the Lessee, and each such document has been duly executed
and delivered by the Lessee and constitutes the legal, valid and binding
obligations of the Lessee enforceable against it in accordance with the
terms thereof except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws or equitable
principles of general application to or affecting the enforcement of
creditors' rights generally (regardless of whether enforceability is
considered in a proceeding in equity or at law);
(f) no authorization, consent or approval of or other action by, and
no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by the Lessee of the Lessee Documents or for the
use and maintenance of the Aircraft except for such registrations,
applications and recordings referred to in the opinions of Special Aviation
Counsel delivered or to be delivered pursuant to Sections 4.01(l)(iv) and
4.02 hereof and except for the filings referred to in Section 4.01(f)
hereof, all of which shall have been duly obtained or made and shall be in
full force and effect on and as of the Refunding Date or as contemplated by
said Sections;
(g) neither the execution, delivery or performance by the Lessee of
the Lessee Documents nor compliance with the terms and provisions hereof or
thereof, conflicts or will conflict with or results or will result in a
breach or violation of any of the terms, conditions or provisions of, or
will require any consent or approval under, any law, governmental rule or
regulation or the charter documents, as amended, or bylaws, as amended, of
the Lessee or any order, writ, injunction or decree of any court or
governmental authority against the Lessee or by which it or any of its
Properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which the Lessee is a party or by which it or
any of its Properties is bound, or constitutes or will constitute a default
thereunder or results or will result in the imposition of any Lien upon any
of its Properties;
(h) there are no pending or, to the knowledge of the Lessee,
threatened actions, suits, investigations or proceedings (whether or not
purportedly on behalf of the Lessee) against or affecting the Lessee or any
of its Property before or by any court or administrative agency which (A)
involve the Aircraft, (B) except for the matters described (i) under "Legal
Proceedings" in the Lessee's Annual Report on Form 10-K for the fiscal year
ended May 31, 1996 (as updated by Note 7 to the financial statements
included in the Lessee's Quarterly Report on Form 10-Q for the fiscal
quarter ended August 31, 1996) and (ii) in the Lessee's Current Reports on
Form 8-K dated June 7, 1996 and August 16, 1996, as to which no
representation is made concerning the Lessee's liability (if any) or the
effect of any adverse determination upon the consolidated financial
condition, business or operations of the Lessee, if adversely determined,
would materially and adversely affect the consolidated financial condition,
business or operations of the Lessee, or (C) if adversely determined would
adversely affect the ability of the Lessee to perform its obligations under
the Lessee Documents;
(i) the Lessee has filed or caused to be filed all tax returns which
are required to be filed and has paid or caused to be paid all taxes shown
to be due and payable pursuant to such returns or pursuant to any
assessment received by the Lessee (other than assessments the payment of
which is being contested in good faith by the Lessee by appropriate
proceedings that do not involve any material danger of sale, forfeiture or
loss of the Aircraft or any part thereof), and the Lessee has no knowledge
of any related actual or proposed deficiency or additional assessment which
either in any case or in the aggregate would materially adversely affect
the Lessee's consolidated financial condition (other than, in any such case,
assessments, the payment of which is being contested in good faith by the
Lessee, as to which no representation is made concerning the Lessee's
liability (if any) or the effect of any adverse determination upon the
Lessee's consolidated financial condition);
(j) except for (A) the filing and, where appropriate, recordation
pursuant to the Transportation Code of the Indenture, the Trust Agreement
and the Lease, (B) the filing of the financing statements referred to in
Section 4.01(f) hereof and (C) the taking of possession by the Indenture
Trustee of the original counterpart of the Lease and maintaining possession
of the original counterpart of the Lease Supplement delivered on the
Delivery Date, no further action, including any filing or recording of any
document, is necessary or advisable in order (i) to establish the Owner
Trustee's title to and interest in the Aircraft and the Lessor's Estate as
against the Lessee and any third parties, or (ii) to perfect the first
security interests in and mortgage Lien on the Trust Indenture Estate in
favor of the Indenture Trustee;
(k) on the Delivery Date, the Owner Trustee received good and
marketable title to the Aircraft, free and clear of all Liens, except the
rights of the Owner Trustee and the Lessee under the Original Lease, the
rights of the Indenture Trustee under the Original Indenture, the
beneficial interest of the Owner Participant created by the Original Trust
Agreement and the interest of the Original Loan Participants created by the
Original Indenture and the Indenture and Security Agreement Supplement
covering the Aircraft;
(l) the Lessee has heretofore delivered to the Owner Participant
true and correct copies of the Lessee's Annual Reports on Form 10-K for the
fiscal years ended May 31, 1995 and May 31, 1996 and its Quarterly Report
on Form 10-Q for the fiscal quarter ended August 31, 1996, and of the
audited consolidated balance sheets of the Lessee for the fiscal years
ended May 31, 1995 and May 31, 1996 and the unaudited consolidated balance
sheet of the Lessee as of August 31, 1996, and the related consolidated
statements of income, changes in common stockholders' investment and cash
flows for the fiscal year and interim reporting period ended on such dates,
accompanied (except in the case of such interim reporting period) by a
report thereon containing opinions without qualification, except as therein
noted, by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent public accountants; said
financial statements have been prepared in accordance with generally
accepted accounting principles consistently applied and present fairly the
financial position of the Lessee as of such dates and the results of its
operations and cash flows for such periods and such Annual Reports,
Quarterly Report and financial statements did not, as of their respective
dates of filing with the SEC, contain any untrue statement of a material
fact or omit a material fact necessary to make the statements contained
therein not misleading;
(m) with respect to ERISA:
(i) none of the Pension Plans (as defined at the end of this
Section 6.01(m)) nor their related trusts have been terminated in a
distress termination pursuant to Section 4041(c) of ERISA or by the
Pension Benefit Guaranty Corporation (together with any successor
agency or instrumentality thereto, the "PBGC") pursuant to Section
4042 of ERISA, nor have any actions been taken to so terminate any
Pension Plan or related trust and neither the Lessee nor any ERISA
Affiliate (as defined at the end of this Section 6.01(m)) has
incurred or could reasonably be expected to incur any material
liability with respect to a Pension Plan under Section 4062, 4063,
4064 or 4069 of ERISA;
(ii) there have been no "reportable events" (as such term is
defined in Section 4043(b) of ERISA) with respect to any Pension Plan
which have resulted or could reasonably be expected to result in any
material liability of the Lessee or any ERISA Affiliate;
(iii) no "accumulated funding deficiency" (as such term is
defined in Section 302 of ERISA or Section 412 of the Code) exists
with respect to any Pension Plan, whether or not waived, nor has any
request for a waiver under Section 412(d) of the Code been, or is
reasonably likely to be, filed with respect to any of the Pension
Plans;
(iv) neither the Lessee nor any ERISA Affiliate has failed to
make any contribution or payment to any Pension Plan which has
resulted or could reasonably be expected to result in the imposition
of a Lien under Section 302(f) of ERISA or Section 412(n) of the Code;
(v) all Pension Plans are in compliance in all material
respects with all applicable provisions of ERISA and the Code;
(vi) neither the Lessee nor any ERISA Affiliate has incurred
or is reasonably likely to incur any material withdrawal liability
pursuant to Section 4201 or 4204 of ERISA or any material liability
under Section 515 of ERISA;
(vii) to the best of the Lessee's knowledge, neither the Lessee
nor any ERISA Affiliate has engaged in a "prohibited transaction"
(within the meaning of Section 4975 of the Code or Section 406 of
ERISA) which could reasonably be expected to subject the Lessee to
the tax or penalties on prohibited transactions imposed by Section
4975 of the Code or Section 502 of ERISA; and
(viii) assuming the truth of the representations contained in
Sections 7.03(a)(viii) and 7.09 hereof and compliance with Section
10.06 of the Indenture, the execution and delivery of this Agreement
and the other Operative Agreements and the consummation of the
transactions contemplated hereby and thereby will not involve any
transaction which is prohibited by Section 406 of ERISA or in
connection with which a tax could be imposed pursuant to Section 4975
of the Code. No part of the funds to be used by the Lessee in
satisfaction of its obligations under this Agreement or any other of
the Operative Agreements to which the Lessee is a party or to which
the Lessee is bound are the assets of any employee benefit plan
subject to Title I of ERISA, or any individual retirement account or
an employee benefit plan subject to Section 4975 of the Code;
as used in this Section 6.01(m), the term "Pension Plan" means an employee
pension benefit plan as defined in Section 3(2) of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA) which is
covered by Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code and which is maintained, or contributed to,
by the Lessee or any ERISA Affiliate, and the term "ERISA Affiliate" means
any entity which together with the Lessee would be treated as a single
employer under Section 414(b), (c), (m) or (o) of the Code;
(n) the Lessee is a Citizen of the United States;
(o) except for the filings referred to in Section 4.01(f) hereof, no
governmental approval of any kind is required of the Owner Participant or
for the Owner Participant's execution of or performance under this
Agreement or any agreement contemplated hereby by reason of any fact or
circumstance of the Lessee, the nature of the Aircraft or the Lessee's
proposed operations or use of the Aircraft;
(p) on the Refunding Date, all premiums with respect to the insurance
required to be provided by the Lessee on or prior to the Refunding Date
under Article 13 of the Lease have been paid by the Lessee;
(q) on the Refunding Date, all sales or use taxes relating to the
sale of the Aircraft by AVSA to the Owner Trustee which are then or were
theretofore due shall have been paid;
(r) the Lessee is not in default under any mortgage, deed of trust,
indenture, lease or other instrument or agreement to which the Lessee is a
party or by which it or any of its Properties or assets may be bound, or in
violation of any applicable law, which default or violation would have a
material adverse effect on the financial condition, business or operations
of the Lessee or its ability to perform any of its obligations under the
Lessee Documents;
(s) no Default or Event of Default or Event of Loss or event, which
with the passage of time or if continued unremedied or unaltered would
constitute an Event of Loss, has occurred or exists;
(t) the Aircraft has been duly certificated by the FAA as to type and
airworthiness; there is in effect with respect to the Aircraft a current
and valid airworthiness certificate issued by the FAA pursuant to the
Transportation Code; and there is no fact known to the Lessee which
materially adversely affects the value, utility or condition of the
Aircraft;
(u) on the Refunding Date, the Lessee shall not be in default in the
performance of any term or condition of the Purchase Agreement, the Purchase
Agreement Assignment, the Engine Warranty Assignment and the GTA;
(v) neither the Lessee nor any subsidiary of the Lessee is an
"investment company" or a company "controlled by an investment company"
within the meaning of the Investment Company Act of 1940, as amended;
(w) the Aircraft is fully equipped to operate in commercial service
and will comply with all governmental requirements governing such service;
(x) there are no broker's or underwriter's or management fees
payable on behalf of the Lessee in connection with the transactions
contemplated in the Operative Agreements other than those of the
Underwriters and First Chicago Leasing Corporation referred to in Article
10 hereof; and
(y) the representations and warranties of the Lessee set forth in the
Original Agreements to which it is a party were correct on and as of the
Delivery Date (except to the extent such representations expressly related
solely to a specified earlier date, in which case such warranties and
representations were correct on and as of such earlier date).
Section 6.02. Offering by Lessee. The Lessee represents and
warrants that it has authorized no one to act on its behalf in connection with
the offer or sale of any interest in the Lessor's Estate or the Trust
Agreement other than First Chicago Leasing Corporation. Neither the Lessee
nor, based on representations of First Chicago Leasing Corporation, anyone
acting on its behalf has directly or indirectly offered any interest in the
Lessor's Estate or the Trust Agreement, or similar interests, for sale to, or
solicited any offer to acquire any of the same from, anyone other than the
Owner Participant and no more than 53 other accredited investors (as such term
is defined in Regulation D promulgated under the Securities Act of 1933, as
amended).
Section 6.03. Certain Covenants of Lessee. The Lessee covenants and
agrees with the Owner Participant, the Owner Trustee (in its individual
capacity and as Owner Trustee), the Pass Through Trustee (in its individual
capacity and as Pass Through Trustee) and the Indenture Trustee (in its
individual capacity and as Indenture Trustee) as follows:
(a) The Lessee will cause to be done, executed, acknowledged and
delivered at the Lessee's cost and expense all such further acts,
conveyances and assurances as the Owner Trustee, the Indenture Trustee, the
Pass Through Trustee or the Owner Participant shall reasonably require for
accomplishing the purposes of this Agreement, the Trust Agreement, the
Indenture, the Tax Indemnity Agreement, the Lease and the other Operative
Agreements to which it is a party. Without limiting the generality of this
Section 6.03(a), the Lessee will promptly take, or cause to be taken, at
the Lessee's cost and expense, such action with respect to the recording,
filing, re-recording and re-filing of the Indenture, each Indenture and
Security Agreement Supplement, the Lease, each Lease Supplement and any
financing statements or other instruments as may be necessary, or as
requested by the Indenture Trustee and appropriate, to maintain the
perfection of the first security interest and the Lien created by the
Indenture, and the Owner Trustee's title to and interest in the Aircraft
and the Lessor's Estate as against the Lessee and any third parties or if
the Lessee cannot take, or cause to be taken, such action, will furnish to
the Indenture Trustee and the Owner 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 either of them to take such
action at the Lessee's cost and expense in a timely manner.
(b) The Lessee shall maintain the certificates referred to in
Section 7.01 of the Lease and shall cause the Aircraft to remain duly
registered, in the name of the Owner Trustee, under the Transportation
Code; provided, however, that the Owner Participant, the Owner Trustee and
the Indenture Trustee agree that if at any time after December 31, 2003, so
long as no Event of Default shall have occurred and be continuing, the
Lessee has requested their consent to the registration of the Aircraft in
the name of the Owner Trustee (or, if appropriate under the laws of such
jurisdiction of reregistration, in the name of the Lessee or a sublessee as
a "lessee" or a "sublessee"), at the Lessee's expense, in a country listed
in Schedule III hereto with which the United States then maintains normal
diplomatic relations (and which is not then experiencing war or substantial
civil unrest), the Owner Participant, upon receipt by the Owner
Participant, the Owner Trustee and the Indenture Trustee of the assurances
and opinion described below, shall not unreasonably withhold their consent
to such change in registration (it being agreed, without limitation, that
the inability of the Lessee to deliver such assurances or such opinion
shall constitute reasonable grounds to withhold such consent).
As a condition to any change in the registration of the Aircraft, the
Owner Participant, the Owner Trustee in its individual and trust capacities,
and the Indenture Trustee shall have received:
(i) assurances satisfactory to them:
(A) to the effect that the insurance provisions of the Lease
have been and will be complied with and are and shall be in full
force and effect upon such change of registry;
(B) as to the continuation of the Lien of the Indenture as a
first priority, duly perfected Lien on the Aircraft;
(C) that the Owner Trustee's right, title and interest in and to
the Aircraft is recognized and fully enforceable in the new
jurisdiction of registry, that the rights of the Owner Trustee in and
to the Aircraft will not be impaired in such new jurisdiction of
registry and that the new jurisdiction of registry will give effect
to the title and registry of the Aircraft therein substantially to
the same extent as does the Government;
(D) that such new country of registry (x) would provide
substantially equivalent protection for the rights of owner
participants, lessors or lenders in similar transactions as provided
under United States law (except that, in the absence of restrictions
under the laws of such country on rights and remedies of lessors and
secured parties similar to those imposed by Sections 362 and 363 of
the Bankruptcy Code, rights and remedies similar to those available
under Section 1110 of the Bankruptcy Code shall not be required) and
(y)(i) if such change in registration is made other than in
connection with a sublease permitted under Section 7.02(a)(i) of the
Lease, imposes maintenance standards at least comparable to those of
the FAA, and (ii) if such change in registration is made in
connection with a sublease permitted under Section 7.02(a)(i) of the
Lease, imposes maintenance standards in conformity with those set
forth in Section 7.02(a)(i) of the Lease;
(E) that import and export certificates and any exchange permits
necessary to allow all Rent and other payments provided for under the
Lease, if required, shall have been procured at the Lessee's own cost
and expense by the Lessee;
(F) that the Lessee shall have effected or caused to be effected
at the Lessee's own cost and expense all recordings and filings that
are required to perfect the Lien of the Indenture;
(G) to the effect that the original indemnities (and any
additional indemnities for which the Lessee is then willing to enter
into a binding agreement to indemnify) in favor of the Owner
Participant, the Owner Trustee (in its individual capacity and as
trustee under the Trust Agreement), the Indenture Trustee (in its
individual capacity, and as trustee under the Indenture), the Pass
Through Trustee (in its individual capacity, and as trustee under the
Pass Through Agreement) and the other Indemnitees under this
Agreement, the Indenture, the Pass Through Agreement and (in the case
of the Owner Participant only) the Tax Indemnity Agreement, afford
each such party substantially the same protection as provided prior
to such change of registry;
(H) that such change will not result in the imposition of, or
increase in the amount of, any Tax (which, for this purpose, includes
the loss of any tax benefits assumed by the Owner Participant to be
available to it based upon the assumptions set forth in Section 2 of
the Tax Indemnity Agreement) for which the Lessee has not agreed to
indemnify the Owner Participant to its reasonable satisfaction, the
Indenture Trustee, the Pass Through Trustee, the Owner Trustee (or
any successor, assign or Affiliate thereof) and the Trust Estate;
(I) that any value added tax, customs duty, tariff or similar
governmental charge relating to the change in jurisdiction of
registration of the Aircraft shall have been paid in full or
adequately provided for by the Lessee to the satisfaction of the
Owner Trustee, the Indenture Trustee and the Owner Participant;
(J) of the payment by the Lessee of any reasonable fees and
expenses of the Owner Participant, the Owner Trustee, the Indenture
Trustee and the Pass Through Trustee in connection with such change
of registry, including any reasonable attorneys' fees and expenses;
(K) that duties and tariffs, if applicable, shall have been paid
for by the Lessee;
(L) as to the continuation of the Lien of the Indenture as a
first priority, duly perfected Lien on the Aircraft and the Trust
Indenture Estate, that all recordings and filings required to so
perfect the Lien of the Indenture have been duly effected, and that
no Liens (except Liens permitted under Section 6.01 of the Lease)
shall arise by reason of such registration; and
(M) that appropriate deregistration powers of attorney in favor
of the Owner Trustee and the Indenture Trustee have been executed and
delivered by the Lessee and any sublessee and, if necessary or
desirable for the effectiveness thereof, filed with the relevant
aeronautics authority; and
(ii) a favorable opinion of counsel (reasonably satisfactory to the
Owner Trustee, the Indenture Trustee and the Owner Participant) in the new
jurisdiction of registry, addressed and reasonably satisfactory to such
parties in scope, form and substance, to the effect:
(A) that the terms (including, without limitation, the governing
law, service-of-process and jurisdictional-submission provisions
thereof) of the Lease and the Indenture are legal, valid, binding and
enforceable in such jurisdiction against the Lessee, any sublessee,
the Owner Trustee and the Indenture Trustee, respectively;
(B) that it is not necessary for the Owner Participant, the Owner
Trustee, the Indenture Trustee or the Pass Through Trustee to
register or qualify to do business or meet other requirements not
already met in such jurisdiction in connection with the registration
in the new jurisdiction (and the filing and/or recordation therein of
the Indenture or Lease) and the exercise of any rights or remedies
with respect to the Aircraft pursuant to the Lease or the Indenture
or in order to maintain such registration and the Lien of the
Indenture;
(C) that the courts of such jurisdiction would provide
substantially equivalent protection to the Lessor, the Owner
Participant, the Pass Through Trustee and the Indenture Trustee as
provided under United States law (with the exception described in
paragraph (b)(i)(D)(x) of this Section 6.03) in respect of the
transactions contemplated hereby, including, without limitation, the
remedies provided in the Indenture and the Lease;
(D) that there is no tort liability of the beneficial owner,
record owner, lessor or mortgagee of an aircraft not in possession
thereof under the laws of such jurisdiction, other than tort
liability which might reasonably have been imposed on such owner,
lessor or mortgagee under the laws of the United States or any state
thereof (it being understood that, in the event such latter opinion
cannot be given in a form satisfactory to the Owner Trustee, the
Owner Participant and the Indenture Trustee, such opinion shall be
waived, if insurance reasonably satisfactory to the Owner
Participant, the Indenture Trustee and the Owner Trustee, in its
individual capacity, is provided, at the Lessee's expense, to cover
such risk and the Lessee undertakes to keep such insurance in full
force and effect);
(E) that the laws of such jurisdiction will not impair the
rights of the Lessor in and to the Aircraft or under the Lease and
(unless the Lessee shall have agreed to provide insurance reasonably
satisfactory to the Indenture Trustee and the Owner Participant
covering the risk of requisition of use of the Aircraft by the
government of registry of the Aircraft) require fair compensation by
the government of such jurisdiction payable in currency freely
convertible into United States dollars for the loss of use of the
Aircraft in the event of such requisition;
(F) that the Owner Trustee's title to the Aircraft is recognized
and fully enforceable in such jurisdiction, that such jurisdiction
will give effect to the title of the Aircraft therein substantially
to the same extent as does the Government, and that the Lien of the
Indenture shall continue as a first priority, duly perfected lien on
the Aircraft;
(G) to such further effect with respect to such other matters as
the Owner Participant, the Owner Trustee, or the Indenture Trustee may
reasonably request; and
(H) the Lien of the Indenture continues to constitute a first
priority, duly perfected Lien on the Aircraft.
(c) The Lessee shall promptly file any reports, or furnish to the
Owner Trustee and the Owner Participant such information as may be required
to enable the Owner Trustee and the Owner Participant timely to file any
reports required to be filed by the Owner Trustee as the Lessor and the
Owner Participant under the Lease with any governmental authority.
(d) The Lessee will cause the Special Aviation Counsel to file, and
where appropriate record, on the Refunding Date, the Lease, the Trust
Agreement and the Indenture. The following documents shall be filed and,
where appropriate, recorded on the Refunding Date with the Aeronautics
Authority in the following order of priority: first, the Trust Agreement,
second, the Indenture and third, the Lease with the Indenture attached
thereto.
(e) The Lessee will furnish to the Owner Participant, the Owner
Trustee and the Indenture Trustee annually after the execution of this
Agreement, by March 15 of each year, commencing with the year 1997, an
opinion, reasonably satisfactory to the Owner Participant and the Indenture
Trustee, of Special Aviation Counsel, or other counsel specified from time
to time by the Lessee acceptable to the Lessor and the Indenture Trustee:
(i) stating either (1) that in the opinion of such counsel such action has
been taken with respect to the recording, filing, re-recording and
re-filing of the Lease, the Indenture, the Trust Agreement, and any
supplements to any of them and any financing statements, continuation
statements or other instruments, and all other action has been taken, as is
necessary to maintain the Owner Trustee's title to and interest in the
Aircraft and the Lessor's Estate as against the Lessee and any third
parties and to maintain the perfection of the security interests created by
said documents and reciting the details of such action, or (2) that in the
opinion of such counsel no such action is necessary to maintain such title
or the perfection of such security interests; (ii) specifying all other
action which needs to be taken during the succeeding 14 months in order to
maintain such title and the perfection of such security interests (which
the Lessee agrees timely to take); and (iii) stating that the Owner Trustee
is the owner of legal title to the Aircraft, and the Aircraft is free and
clear of all Liens, except the security interest created by the Indenture
and such as are permitted by the Lease and the Indenture.
(f) The Lessee shall at all times maintain its corporate existence
except as permitted by Section 6.03(g) hereof and all of its rights,
privileges and franchises necessary in the normal conduct of its business,
except for any corporate right, privilege or franchise (i) that it
determines, in its reasonable, good faith business judgment, is no longer
necessary or desirable in the conduct of its business and (ii) the loss of
which will not materially adversely affect or diminish the rights of the
Holders or the Owner Participant.
(g) The Lessee shall not enter into any merger or consolidation, or
convey, transfer or lease all or substantially all of its assets as an
entirety to any Person, unless the surviving corporation or Person which
acquires by conveyance, transfer or lease all or substantially all of the
assets of the Lessee as an entirety (i) is a domestic corporation organized
and existing under the laws of the United States or a political subdivision
thereof, (ii) is a Citizen of the United States, (iii) is a U.S. Air
Carrier, (iv) expressly assumes by an instrument in writing in form and
substance satisfactory to the Owner Participant, the Indenture Trustee and
the Owner Trustee all of the Lessee's obligations hereunder and under the
other Operative Agreements, and each other document contemplated hereby or
thereby and the Lessee delivers such instrument to the Indenture Trustee,
the Owner Participant and the Owner Trustee, (v) provides an opinion from
outside counsel to the Lessee which counsel shall be reasonably
satisfactory to the Owner Participant and the Indenture Trustee and which
opinion shall be reasonably satisfactory to the Owner Participant and the
Indenture Trustee, and an officer's certificate, each stating that such
merger, consolidation, conveyance, transfer or lease and the instrument
noted in clause (iv) above comply with this Section 6.03(g), that such
instrument is a legal, valid and binding obligation of, and is enforceable
against, such survivor or Person, and that all conditions precedent herein
provided for relating to such transaction have been complied with, and (vi)
immediately after such merger, consolidation or conveyance, transfer or
lease, as the case may be, the surviving company (or Person which acquires
by conveyance, transfer or lease the assets of the Lessee) is in compliance
with all of the terms and conditions of this Agreement and the Lease and
each other Operative Agreement and each other document contemplated hereby
or thereby; provided that no such merger, consolidation or conveyance,
transfer or lease shall be permitted if the same gives rise to an Event of
Default.
Upon any consolidation or merger, or any conveyance, transfer or
lease of all or substantially all of the assets of the Lessee and the
satisfaction of the conditions specified in this Section 6.03(g), the
successor corporation formed by such consolidation or into which the Lessee
is merged or the Person to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and
power of, the Lessee under this Agreement and the Lease and each other
Operative Agreement and any other document contemplated hereby and thereby
to which the Lessee is a party with the same effect as if such successor
corporation had been named as the Lessee herein and therein. No such
conveyance, transfer or lease of all or substantially all of the assets of
the Lessee as an entirety shall have the effect of releasing the Lessee or
any successor corporation which shall theretofore have become the Lessee
hereunder in the manner prescribed in this Section 6.03(g) from its
liability hereunder or under the other Operative Agreements. Nothing
contained herein shall permit any lease, sublease, or other arrangement for
the use, operation or possession of the Aircraft except in compliance with
the applicable provisions of the Lease.
(h) The Lessee agrees to give prompt written notice to the Owner
Participant, the Owner Trustee and the Indenture Trustee of any change in
the address of its chief executive office (as such term is used in Section
9-103(3) of the Tennessee Uniform Commercial Code) or of any change in its
corporate name.
(i) The Lessee agrees to furnish to the Owner Participant, the
Lessor and the Indenture Trustee:
(A) as soon as available, but in any event within one hundred
twenty (120) days after the end of each fiscal year of the Lessee, a
consolidated balance sheet as of the end of such fiscal year, and the
related consolidated statements of income, common stockholders'
equity, retained earnings and cash flows of the Lessee for the fiscal
year then ended as prepared and certified by the Lessee's independent
certified public accountants, including their opinion;
(B) within sixty (60) days after the end of the first, second
and third quarterly accounting periods in each fiscal year of the
Lessee, a consolidated balance sheet of the Lessee prepared by it as
of the close of the accounting period then ended, together with the
related consolidated statements of income, retained earnings and cash
flows for such accounting period certified by the chief accounting
officer or a financial vice president of the Lessee;
(C) promptly upon their general transmission, copies of all
reports and statements furnished by the Lessee to its stockholders;
(D) promptly after filing with the SEC, copies of the Lessee's
Annual Reports on Form 10-K (including all corresponding annual
reports to shareholders), Quarterly Reports on Form 10-Q and, if
requested, any registration statement or prospectus filed by the
Lessee with any securities exchange or with the SEC;
(E) promptly upon (and in any event within five (5) Business
Days after) any officer of the Lessee obtaining knowledge of any
condition or event which constitutes a Default or an Event of
Default, an officer's certificate specifying the nature and period of
existence thereof and what action the Lessee has taken or is taking
or proposes to take with respect thereto;
(F) from time to time, such other financial information as the
Lessor, the Owner Participant or the Indenture Trustee may reasonably
request.
Concurrently with the delivery of the financial statements referred
to in clause (A) above, the Lessee shall deliver to the Lessor, the Owner
Participant, the Indenture Trustee and the Pass Through Trustee a certificate
of the Lessee, signed by any one of the President, the Chief Financial
Officer, the General Counsel, the Treasurer or the principal accounting
officer of the Lessee, stating that the signer, or an employee reporting to
same, is familiar with the relevant terms of this Agreement and the Lease and
the signer has reviewed, or has caused to be made under such Person's
supervision a review, of the activities of the Lessee and that, to the best of
his or her knowledge, there does not exist any Default or any Event of Default
or if a Default or an Event of Default exists or did exist, specifying the
nature thereof, the period of existence thereof and what action the Lessee has
taken or proposes to take with respect thereto.
Section 6.04. Survival of Representations and Warranties. The
representations and warranties of the Lessee provided in Sections 6.01 and 6.02
hereof and in any other Operative Agreement shall survive the Closings
hereunder and the expiration or other termination of this Agreement and the
other Operative Agreements.
ARTICLE 7
OTHER PARTIES' REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Acquisitions and Offerings of Interests in Lessor's
Estate. (a) [Intentionally Left Blank.]
(b) Owner Participant. The Owner Participant represents and
warrants that its interest in the Lessor's Estate and the Trust Agreement was
acquired by it for its own account and not with a view to resale or
distribution thereof; provided, however, that the disposition by the Owner
Participant of its interest in the Lessor's Estate and the Trust Agreement
shall, subject to the terms and provisions of Section 7.03(d) hereof, at all
times be within its control and the foregoing representation shall not limit
the Owner Participant's right to transfer or sell such interests pursuant to
the terms of this Agreement. Neither the Owner Participant nor anyone
authorized to act on its behalf has directly or indirectly offered any
interest in the Lessor's Estate or the Trust Agreement, or in any similar
security, for sale to, or solicited any offer to acquire any of the same from,
anyone. The Owner Participant further represents and warrants that neither it
nor anyone authorized to act on its behalf has made or will make any offer,
solicitation or sale of any interest in the Lessor's Estate or the Trust
Agreement in violation of the provisions of Section 5 of the Securities Act of
1933, as amended. No representation in this Section 7.01(b) shall include any
action or inaction of the Lessee, the Agent, First Chicago Leasing Corporation
or the Underwriters whether or not such action or inaction is purportedly on
behalf of the Owner Trustee, the Owner Participant or any of their Affiliates.
Section 7.02. Citizenship. (a) Generally. Each of the Owner
Trustee, in its individual capacity and as Trustee, and the Owner Participant
severally represents and warrants that it is a Citizen of the United States on
the Refunding Date. If the Owner Participant or the Owner Trustee in its
individual capacity does not comply with the requirements of this Section
7.02, the Owner Trustee, the Indenture Trustee and the Owner Participant
hereby agree that a Default or an Event of Default shall not be deemed to have
occurred and be continuing under the Lease due to non-compliance by the Lessee
with the registration requirements in the Lease occasioned by the
noncompliance of the Owner Participant or the Owner Trustee.
(b) Owner Trustee. The Owner Trustee, in its individual capacity,
covenants that if at any time it shall have actual knowledge that it has
ceased to be a Citizen of the United States, it will resign immediately as the
Owner Trustee if such citizenship is necessary under the Transportation Code
as in effect at such time or, if it is not necessary under the Transportation
Code as in effect at such time, if it is informed in writing by the Lessee or
the Owner Participant that such lack of United States citizenship would have
any adverse effect on the Lessee or the Owner Participant. The Owner Trustee,
in its individual capacity, further covenants that if at any time it appears
reasonably probable that it will cease to be a Citizen of the United States
based on information that is (i) known to a Responsible Officer or (ii)
generally known to the public, it will promptly so notify, to the extent
permitted by law, all parties to this Agreement.
(c) Owner Participant. The Owner Participant agrees, solely for the
benefit of the Lessee, the Pass Through Trustee, the Indenture Trustee and the
Owner Trustee, that if at any time when the Aircraft is registered or the
Lessee proposes to register the Aircraft in the United States (i) either it
shall cease to be, or an event which has been publicly disclosed has occurred
of which the Owner Participant has knowledge and which will cause the Owner
Participant to cease to be, a Citizen of the United States and (ii) the
Aircraft shall or would therefore become ineligible for registration in the
name of the Owner Trustee under the Transportation Code and regulations then
applicable thereunder, then the Owner Participant shall give notice thereof to
the Lessee, the Owner Trustee and the Indenture Trustee and shall (at its own
expense and without any reimbursement or indemnification from the Lessee)
immediately (and in any event within a period of 20 days) (x) effect a voting
trust or other similar arrangement, (y) transfer in accordance with the terms
of this Agreement and the Trust Agreement all its rights, title and interest
in and to such Trust Agreement, the Lessor's Estate and this Agreement, or (z)
take any other alternative action that would prevent any deregistration, or
maintain or permit the United States registration, of the Aircraft. It is
agreed that the Owner Participant shall be liable to pay promptly on request
(A) to each of the other parties hereto any actual damages (but not
consequential damages) suffered by any such other party to the extent the same
shall result from the representation and warranty of the Owner Participant in
the first sentence of Section 7.02(a) hereof proving to be untrue as of the
Refunding Date; and (B) to the Lessee, the Indenture Trustee or the Pass
Through Trustee for any damages actually (but not consequentially) incurred by
the Lessee, the Indenture Trustee and the Pass Through Trustee as a result of
the Owner Participant's failure to comply with its obligations pursuant to the
first sentence of this Section 7.02(c); provided, that, the foregoing shall
not restrict the Pass Through Trustee or the Indenture Trustee from asserting
against the Owner Participant any damages actually incurred by the holders of
any Pass Through Certificates. Each party hereto agrees, upon the request and
at the sole expense of the Owner Participant, to cooperate with the Owner
Participant in complying with its obligations under the provisions of the first
sentence of this Section 7.02(c), but without any obligation on the part of
such other party to take any action believed by it in good faith to be
unreasonably burdensome to such party or materially adverse to its business
interests.
Section 7.03. Representations, Warranties and Covenants of Owner
Participant. (a) Representations, Warranties and Covenants. In addition to
and without limiting its other representations and warranties provided for in
this Article 7, the Owner Participant represents and warrants that:
(i) it is a corporation duly incorporated and validly existing in
good standing under the laws of the State of Delaware and it has full
corporate power, authority and legal right to carry on its present business
and operations, to own or lease its Properties and to enter into and to
carry out the transactions contemplated by the Original Agreements to which
it is a party, this Agreement, the Tax Indemnity Agreement, and the Trust
Agreement;
(ii)the execution, delivery and performance by it of the Original
Agreements to which it is a party, this Agreement, the Tax Indemnity
Agreement, and the Trust Agreement have been duly authorized by all
necessary corporate action on its part and, assuming the accuracy of the
Lessee's representations in Section 6.01(o) hereof, do not require any
governmental approvals that would be required to be obtained by the Owner
Participant;
(iii) based on the representations, warranties and covenants
contained in Sections 6.01(m)(viii), 6.02 and 7.09 hereof and compliance
with Section 10.06 of the Indenture, neither the execution, delivery or
performance by the Owner Participant of the Original Agreements to which it
is a party, this Agreement, the Tax Indemnity Agreement, and the Trust
Agreement nor compliance with the terms and provisions hereof or thereof,
conflicts or will conflict with or results or will result in a breach or
violation of any of the terms, conditions or provisions of, or will require
any consent or approval under any law, governmental rule or regulation
applicable to the Owner Participant or the charter documents, as amended, or
bylaws, as amended, of the Owner Participant or any order, writ, injunction
or decree of any court or governmental authority against the Owner
Participant or by which it or any of its Properties is bound or any
indenture, mortgage or contract or other agreement or instrument to which
the Owner Participant is a party or by which it or any of its Properties is
bound, or constitutes or will constitute a default thereunder or results or
will result in the imposition of any Lien upon any of its Properties;
(iv)the Original Agreements to which it is a party, this Agreement,
the Tax Indemnity Agreement and the Trust Agreement have been or on the
Refunding Date will be duly executed and delivered by the Owner Participant
and constitute or on the Refunding Date will constitute the legal, valid
and binding obligation of the Owner Participant enforceable against it in
accordance with their terms except as such enforceability may be limited by
bankruptcy, insolvency, moratorium, reorganization or other similar laws or
equitable principles of general application to or affecting the enforcement
of creditors' rights (regardless of whether enforceability is considered in
a proceeding in equity or at law);
(v) it is not in default under any mortgage, deed of trust,
indenture, lease or other instrument or agreement to which the Owner
Participant is a party or by which it or any of its Properties may be
bound, or in violation of any applicable law, which default or violation
would have a material adverse effect on the financial condition, business
or operations of the Owner Participant or an adverse effect on the ability
of the Owner Participant to perform its obligations under the Original
Agreements to which it is a party, this Agreement and the other Operative
Agreements to which it is or is to be a party;
(vi) there are no pending or, to the knowledge of the Owner
Participant, threatened actions, suits, investigations or proceedings
against the Owner Participant before any court, administrative agency or
tribunal which are expected to materially adversely affect the ability of
the Owner Participant to perform its obligations under any of the Original
Agreements to which it is a party, this Agreement and the other Operative
Agreements to which it is or is to be a party and the Owner Participant
knows of no pending or threatened actions or proceedings before any court,
administrative agency or tribunal involving it in connection with the
transactions contemplated by the Operative Agreements;
(vii)neither the execution and delivery by it of the Original
Agreements to which it is a party, this Agreement or the other Operative
Agreements to which it is nor the performance of its obligations hereunder
or thereunder requires the consent or approval of or the giving of notice
to, the registration with, or the taking of any other action in respect of,
any governmental authority or agency that would be required to be obtained
or taken by the Owner Participant except for filings contemplated by this
Agreement;
(viii) no part of the funds to be used by it to acquire the interests
to be acquired by the Owner Participant under this Agreement constitutes
assets (within the meaning of ERISA and any applicable rules and
regulations) of any employee benefit plan subject to Title I of ERISA or of
any plan or individual retirement account subject to Section 4975 of the
Code;
(ix)it is a "U.S. Person" as defined in Section 7701(a)(30) of the
Code and is not a tax resident of another country;
(x) it has a consolidated tangible net worth of not less than
$75,000,000; and
(xi) the representations and warranties of the Owner Participant set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier date).
Notwithstanding the foregoing or anything else contained in this
Agreement, the Owner Participant makes no representation or warranty in this
Agreement with respect to laws, rules or regulations relating to aviation or
to the nature or use of the equipment owned by the Owner Trustee, including,
without limitation, the airworthiness, value, condition, workmanship, design,
patent or trademark infringement, operation, merchantability or fitness for
use of the Aircraft, other than such laws, rules or regulations relating to
the citizenship requirements of the Owner Participant under applicable
aviation law.
(b) Lessor's Liens. The Owner Participant further represents,
warrants and covenants that there are no Lessor's Liens attributable to it (or
an Affiliate thereof) against, on or with respect to the Aircraft or the
Lessor's Estate or the Trust Indenture Estate, and that there will not be any
Lessor's Lien attributable to it (or an Affiliate thereof) against, on or with
respect to the Aircraft or the Lessor's Estate or the Trust Indenture Estate
attributable to it (or an Affiliate thereof) on the Refunding Date. The Owner
Participant agrees with and for the benefit of the Lessee, the Owner Trustee,
the Indenture Trustee and the Pass Through Trustee that the Owner Participant
will, at its own cost and expense, take such action as may be necessary (by
bonding or otherwise, so long as neither the Lessee's operation and use of the
Aircraft nor the validity and priority of the Lien of the Indenture is
impaired) to duly discharge and satisfy in full, promptly after the same first
becomes known to the Owner Participant, any Lessor's Lien against, on or with
respect to the Aircraft or the Lessor's Estate or the Trust Indenture Estate
attributable to the Owner Participant (or an Affiliate thereof), provided,
however, that the Owner Participant shall not be required to discharge or
satisfy such Lessor's Lien which is being contested by the Owner Participant
in good faith and by appropriate proceedings so long as such proceedings do
not involve any material danger of the sale, forfeiture or loss of the
Aircraft or the Lessor's Estate or the Trust Indenture Estate or any interest
in any thereof or otherwise materially adversely affect the validity or
priority of the Lien of the Indenture.
(c) Reimbursement. Without limiting any other rights the parties
hereto may have as a result of any breach by the Owner Participant of its
obligations in Section 7.03(b) hereof, the Owner Participant agrees to
reimburse each other party hereto for all reasonable legal fees and expenses
of counsel that may be incurred by any such party as a result of the failure
of the Owner Participant to discharge and satisfy any such Lessor's Lien in
accordance with the terms of Section 7.03(b) hereof.
(d) Assignment of Interests of Owner Participant. At any time after
all obligations of the Owner Participant under Section 2.01(d) hereof have
been satisfied in full, and subject to the conditions set forth in this
Section 7.03(d), the Owner Participant may assign, convey or otherwise
transfer to a single institutional investor or an Affiliate of an
institutional investor all (but not less than all) of the Beneficial Interest,
provided that it gives the Lessee and the Indenture Trustee at least 10
Business Days' notice of such assignment, conveyance or other transfer and
provided further that the Owner Participant and any Owner Participant
Guarantor shall remain liable for all obligations of the Owner Participant
under the Trust Agreement and the Operative Agreements to which the Owner
Participant is a party to the extent (but only to the extent) relating to the
period on or before the date of such transfer and provided that the transferee
agrees by a written instrument substantially in the form attached hereto as
Exhibit E-1 to assume primary liability for all obligations as an Owner
Participant under the Trust Agreement and the other Operative Agreements to
which such Owner Participant is a party relating to the period after the date
of transfer.
Any such transferee shall (a) be (i) a bank, savings institution,
finance company, leasing company or trust company, national banking
association acting for its own account or in a fiduciary capacity as trustee
or agent under any pension, retirement, profit sharing or similar trust or
fund, insurance company, fraternal benefit society or corporation acting for
its own account having a combined capital and surplus (or, if applicable,
consolidated tangible net worth or its equivalent) of not less than
$75,000,000, (ii) a subsidiary of any Person described in clause (i) where such
Person provides (A) support for the obligations assumed by such transferee
subsidiary reasonably satisfactory to the Lessee, the Owner Trustee and the
Indenture Trustee or (B) an unconditional guaranty substantially in the form
of Exhibit E-2 attached hereto of such transferee subsidiary's obligations, or
(iii) an Affiliate of the transferring Owner Participant, so long as such
Affiliate has a combined capital and surplus (or, if applicable, consolidated
tangible net worth or its equivalent) of not less than $75,000,000, (b) be
legally capable of binding itself to the obligations of the Owner Participant
and shall expressly agree to assume all obligations of the Owner Participant
under the Trust Agreement and this Agreement and (c) provide representations
substantially similar to those contained in Sections 7.02(a) and 7.03(a)
hereof. In the event of any such assignment, conveyance or transfer, the
transferee shall become a party to the Trust Agreement and shall agree to be
bound by all the terms of and will undertake all of the obligations of the
Owner Participant contained in the Trust Agreement and the other Operative
Agreements in the manner set forth in the form attached as Exhibit E-1.
A transferee hereunder shall be (i) a "U.S. Person" as defined in
Section 7701(a)(30) of the Code (or any successor provision thereto) and (B)
such transferee shall be personally liable for any debt service to the extent
that its receipt of rentals is reduced by reason of any withholding Taxes that
result from such transferee's failure to be such a "U.S. Person" and (ii) a
Citizen of the United States or has established a voting trust, voting powers
or other arrangement reasonably satisfactory to the Indenture Trustee and the
Lessee to permit the Owner Trustee to be the registered owner of the Aircraft
under the Transportation Code. A transferee hereunder shall not be, and in
acquiring the Beneficial Interest shall not use the assets of, an employee
benefit plan subject to Title I of ERISA or an individual retirement account
or a plan subject to Section 4975 of the Code. Assuming the truth of the
representations made in Sections 6.01(m) and 7.06 hereof and compliance with
Section 10.06 of the Indenture, no such assignment, conveyance or transfer
shall violate any provision of law or regulation or create a relationship
which would be in violation thereof. The Owner Trustee shall not be on notice
of or otherwise bound by any such assignment, conveyance or transfer unless
and until it shall have received an executed counterpart of the instrument of
such assignment, conveyance or transfer. Upon any such disposition by the
Owner Participant to a transferee as above provided, the transferee shall be
deemed the "Owner Participant" or "Trustor" for all purposes of the Operative
Agreements, and shall be deemed to have made all the payments previously made
by its transferor and to have acquired the same interest in the Lessor's
Estate as theretofore held by its transferor; and each reference therein to
the "Owner Participant" or "Trustor" shall thereafter be deemed a reference to
such transferee.
Notwithstanding anything to the contrary contained in this Section
7.03(d), in no event shall the Owner Participant transfer its interest in the
Beneficial Interest to any entity whose business is that of a nationwide or
worldwide overnight or expedited delivery small package air courier, cargo or
freight deliverer or which competes with the Lessee in such lines of business.
The Lessee agrees that it will reasonably cooperate with the Owner Participant
in effecting an assignment of the Owner Participant's interests including,
without limitation, providing letters to any successor Owner Participant
permitting such successor Owner Participant to rely on any opinions provided
by the Lessee on the Delivery Date.
(e) Actions with Respect to Lessor's Estate, Etc. The Owner
Participant agrees that it will not take any action to subject the Lessor's
Estate or the trust established by the Trust Agreement, as debtor, to the
reorganization or liquidation provisions of the Bankruptcy Code or any other
applicable bankruptcy or insolvency statute.
Section 7.04. Representations, Covenants and Warranties of FSB and
the Owner Trustee. (a) In addition to and without limiting its other
representations and warranties provided for in this Article 7, FSB represents
and warrants, in its individual capacity with respect to items (i), (ii),
(iii)(A), (iv), (v), (vi) and (vii) below, and as the Owner Trustee with
respect to items (iii)(B) and (iv) that:
(i)it is a national banking association duly organized and validly
existing in good standing under the laws of the United States of America
with its principal place of business and chief executive office (as such
terms are used in Article 9 of the Uniform Commercial Code) at ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇, Attention: Corporate Trust
Department and has full corporate power and authority, in its individual
capacity or (assuming the Trust Agreement has been duly authorized,
executed and delivered by the Owner Participant) as the Owner Trustee, as
the case may be, to carry on its business as now conducted, and to
execute, deliver and perform this Agreement, the Original Agreements to
which it is a party and the Operative Agreements to which it is or is to be
a party;
(ii)the execution, delivery and performance by FSB, either in its
individual capacity or as the Owner Trustee, as the case may be, of this
Agreement, the Original Agreements and the Operative Agreements to which it
is or is to be party have been duly authorized by all necessary corporate
action on its part, and do not contravene its certificate of incorporation
or by-laws; each of this Agreement, the Original Agreements and the other
Operative Agreements to which it is or is to be a party has been duly
authorized, executed and delivered by FSB, either in its individual
capacity or as the Owner Trustee, as the case may be, and neither the
execution and delivery thereof nor FSB's performance of or compliance with
any of the terms and provisions thereof will violate any Federal or state
or local law or regulation governing FSB's banking or trust powers;
(iii)(A) assuming due authorization, execution and delivery by each
other party thereto, each of the Operative Agreements to which it is or is
to be party when duly executed and delivered will, and each of the Original
Agreements to which it is a party does, to the extent each such document is
entered into by FSB in its individual capacity, constitute the legal, valid
and binding obligation of FSB in its individual capacity enforceable
against it in such capacity in accordance with its respective terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and the performance by FSB in its individual capacity of
any of its obligations thereunder does not contravene any lease, regulation
or contractual restriction binding on FSB in its individual capacity;
(B) assuming due authorization, execution and delivery by each other
party thereto, each of the Operative Agreements to which it is or is to be
party when duly executed and delivered will, and each of the Original
Agreements to which it is a party does, to the extent each such document is
entered into by the Owner Trustee in its trust capacity, constitute the
legal, valid and binding obligation of the Owner Trustee enforceable
against it in such capacity in accordance with its respective terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and the performance by the Owner Trustee of any of its
obligations thereunder does not contravene any lease, regulation or
contractual restriction binding on the Owner Trustee;
(iv)there are no pending or, to its knowledge, threatened actions or
proceedings against FSB before any court or administrative agency which
would materially and adversely affect the ability of FSB, either in its
individual capacity or as the Owner Trustee, as the case may be, to perform
its obligations under the Operative Agreements to which it is or is to be
party;
(v) it shall give the Lessee, the Indenture Trustee and the Owner
Participant at least thirty (30) days' prior written notice in the event of
any change in its chief executive office or name;
(vi)neither the execution and delivery by it, either in its
individual capacity or as the Owner Trustee, as the case may be, of any of
the Original Agreements and the Operative Agreements to which it is or is
to be a party, requires on the part of FSB in its individual capacity or
any of its Affiliates the consent or approval of or the giving of notice
to, the registration with, or the taking of any other action in respect of,
any Federal or Utah governmental authority or agency governing its banking
or trust powers;
(vii)on the Refunding Date the Owner Trustee be holding whatever
title to the Aircraft as was conveyed to it by AVSA on the Delivery Date,
the Aircraft shall be free of Lessor's Liens attributable to FSB in its
individual capacity and FSB in its individual capacity and as Owner Trustee
is a Citizen of the United States; and
(viii) the representations and warranties of the Owner Trustee set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier date).
(b) Lessor's Liens. FSB, in its individual capacity, further
represents, warrants and covenants that there are no Lessor's Liens
attributable to it in its individual capacity against, on or with respect to
the Aircraft or the Lessor's Estate or the Trust Indenture Estate, and that
there will not be any such Lessor's Liens against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate on the Refunding
Date. The Owner Trustee, in its trust capacity, and at the cost and expense of
the Lessee, covenants that it will in its trust capacity promptly, and in any
event within 30 days after the same shall first become known to it, take such
action as may be necessary to discharge duly any Lessor's Liens attributable
to it in its trust capacity. FSB, in its individual capacity, covenants and
agrees that it will at its own expense take such action as may be necessary to
duly discharge and satisfy in full, promptly, and in any event within 30 days
after the same shall first become known to it, any Lessor's Liens against, on
or with respect to the Aircraft or the Lessor's Estate or the Trust Indenture
Estate attributable to it in its individual capacity or the consolidated group
of taxpayers of which it (in such capacity) is a part which may arise at any
time after the date of this Agreement.
(c) Indemnity for Lessor's Liens. FSB, in its individual capacity,
agrees to indemnify and hold harmless the Lessee, the Indenture Trustee, the
Owner Participant and the Pass Through Trustee and the Owner Trustee from and
against any loss, cost, expense or damage which may be suffered by the Lessee,
the Indenture Trustee, the Owner Participant, the Pass Through Trustee or the
Owner Trustee as a result of the failure of FSB to discharge and satisfy any
Lessor's Liens attributable to it in its individual capacity, as described in
Section 7.04(b) hereof.
(d) Securities Act. None of FSB, the Owner Trustee or any Person
authorized by either of them to act on its behalf has directly or indirectly
offered or sold or will directly or indirectly offer or sell any interest in
the Lessor's Estate, or in any similar security relating to the Lessor's
Estate, or in any security the offering of which for purposes of the
Securities Act of 1933, as amended, would be deemed to be part of the same
offering as the offering of the aforementioned securities to, or solicited any
offer to acquire any of the same from, any Person.
Section 7.05. Representations, Warranties and Covenants of the
Indenture Trustee. (a) The Indenture Trustee in its individual capacity (other
than as the Pass Through Trustee) represents as follows:
(i) it is a Massachusetts trust company duly organized and validly
existing in good standing under the laws of the Commonwealth of
Massachusetts and has the power and authority to enter into and perform its
obligations under the Indenture, this Agreement and the Original Agreements
to which it is a party and to authenticate the Certificates to be delivered
on the Refunding Date;
(ii)the Indenture and this Agreement, the Original Agreements to
which it is a party and the other Operative Agreements to which it is or is
to be a party, and the authentication of the Certificates to be delivered
on the Refunding Date, have been duly authorized by all necessary corporate
action on its part, and neither the execution and delivery thereof nor its
performance of any of the terms and provisions thereof will violate any
Federal or Massachusetts law or regulation relating to its banking or trust
powers or contravene or result in any breach of, or constitute any default
under, its articles of association or by-laws;
(iii)each of the Indenture and this Agreement, the Original
Agreements to which it is a party and the other Operative Agreements to
which it is or is to be a party, has been duly executed and delivered by it
and, assuming that each such agreement is the legal, valid and binding
obligation of each other party thereto, is the legal, valid and binding
obligation of the Indenture Trustee, enforceable against the Indenture
Trustee in accordance with its terms except as such enforceability may be
limited by bankruptcy, insolvency, reorganization or other similar laws or
equitable principles of general application to or affecting the enforcement
of creditors' rights (regardless of whether enforceability is considered in
a proceeding in equity or at law);
(iv)neither the execution and delivery by it of the Indenture and this
Agreement, the Original Agreements to which it is a party and the other
Operative Agreements to which it is or is to be a party, nor the
performance by it of any of the transactions contemplated hereby or
thereby, requires the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any
Federal or state governmental authority or agency governing its banking and
trust powers;
(v) the representations and warranties of the Indenture Trustee set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier
date); and
(vi)the Indenture Trustee holds the original counterparts of the
Original Lease, the Lease Supplement, Ancillary Agreement I and AVSA's
Warranty ▇▇▇▇ of Sale.
(b) Indenture Trustee's Liens. The Indenture Trustee, in its
individual capacity, further represents, warrants and covenants that there are
no Indenture Trustee's Liens attributable to it in its individual capacity
against, on or with respect to the Aircraft or the Lessor's Estate or the
Trust Indenture Estate, and that there will not be any Indenture Trustee's
Liens against, on or with respect to the Aircraft or the Lessor's Estate or
the Trust Indenture Estate on the Refunding Date. The Indenture Trustee, in
its individual capacity, covenants and agrees that it will at its own expense
take such action as may be necessary to duly discharge and satisfy in full,
promptly, and in any event within 30 days, after the same shall first become
known to it, any Indenture Trustee's Liens against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate.
(c) Indemnity for Indenture Trustee's Liens. The Indenture Trustee,
in its individual capacity, agrees to indemnify and hold harmless the Lessee,
the Owner Participant, the Owner Trustee and the Pass Through Trustee from and
against any loss, cost, expense or damage which may be suffered by the Lessee,
the Indenture Trustee, the Owner Participant, the Owner Trustee or the Pass
Through Trustee as a result of the failure of the Indenture Trustee to
discharge and satisfy any Indenture Trustee's Liens attributable to it in its
individual capacity, as described in Section 7.05(b) hereof.
Section 7.06. Indenture Trustee's Notice of Default. The Indenture
Trustee agrees to give the Owner Participant notice of any Default or Event of
Default promptly upon a Responsible Officer of the Indenture Trustee having
actual knowledge thereof.
Section 7.07. Releases from Indenture. The Indenture Trustee
covenants and agrees, for the benefit of the Lessee and the Owner Participant,
to execute and deliver the instruments of release from the Lien of the
Indenture which it is required to execute and deliver in accordance with the
provisions of Article XIV of the Indenture, and the Owner Participant agrees,
for the benefit of the Lessee, to cause the Owner Trustee to request the
Indenture Trustee to execute and deliver such instruments of release upon
written notice from the Lessee to make such request.
Section 7.08. Covenant of Quiet Enjoyment. The Owner Participant,
the Indenture Trustee, the Pass Through Trustee and the Owner Trustee
covenants and agrees as to itself only that, so long as no Event of Default
under the Lease has occurred and is continuing, neither the Owner Participant
(or the Owner Trustee, the Pass Through Trustee or the Indenture Trustee, as
the case may be) nor any Person lawfully claiming through the Owner
Participant (or the Owner Trustee, the Pass Through Trustee or the Indenture
Trustee, as the case may be) shall interfere with the Lessee's right quietly
to enjoy the Aircraft during the Term without hindrance or disturbance by the
Owner Participant (or the Owner Trustee, the Pass Through Trustee or the
Indenture Trustee, as the case may be).
Section 7.09. Original Loan Participants' and Pass Through Trustee's
Representations and Warranties. (a) Each Original Loan Participant
represents and warrants that the representations and warranties made by it in
Sections 7.01(a) and 7.06 of the Original Participation Agreement were correct
on and as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
representations and warranties were correct on and as of such earlier date).
(b) The Pass Through Trustee, in its individual capacity (except
with respect to clause (iii) below), represents and warrants as of the date
hereof (except as otherwise provided), as of the Pass Through Closing Date and
as of the Refunding Date that:
(i) it is a Massachusetts trust company duly organized and validly
existing in good standing under the laws of the Commonwealth of
Massachusetts and has the power and authority to enter into and perform its
obligations under the Pass Through Agreement, the Series Supplements and
this Agreement and to execute and authenticate the Pass Through
Certificates to be delivered on the Pass Through Closing Date;
(ii)the execution, delivery and performance of this Agreement, the
Pass Through Agreement and the Series Supplements and the performance of its
obligations hereunder and thereunder (including the execution and
authentication of the Pass Through Certificates to be delivered on the Pass
Through Closing Date) have been fully authorized by all necessary corporate
action on its part, and, subject to (A) the registration of the issuance
and sale of the Pass Through Certificates under the Securities Act, (B)
compliance with any applicable state securities laws and (C) the
qualification of the Pass Through Agreement under the Trust Indenture Act,
neither the execution and delivery thereof nor its performance of any of
the terms and provisions thereof will violate any Federal or Massachusetts
law or regulation relating to its banking or trust powers or contravene or
result in any breach of, or constitute any default under its articles of
association, or bylaws or the provisions of any indenture, mortgage,
contract or other agreement to which it is a party or by which it or its
properties may be bound or affected; and
(iii)each of this Agreement and the Pass Through Agreement has been,
and as of the Pass Through Closing Date the Series Supplements will be,
duly executed and delivered by it (in its individual and trust capacities)
and, assuming that each such agreement is the legal, valid and binding
obligation of each other party thereto, is or will be, as the case may be,
the legal, valid and binding obligation of the Pass Through Trustee (in its
individual and trust capacities), enforceable in accordance with its
respective terms except as limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights generally
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
Section 7.10. Survival of Representations, Warranties and Covenants.
The representations, warranties and covenants of the Owner Participant, the
Owner Trustee, the Pass Through Trustee and the Indenture Trustee provided for
in this Article 7, and their respective obligations under any and all of them,
shall survive the Closings and the expiration or other termination of this
Agreement, and the other Operative Agreements.
Section 7.11. Lessee's Assumption of the Certificates. (a) Subject
to compliance by the Lessee with all of its obligations under the Operative
Agreements, each of the Owner Participant, the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Lessee covenants and agrees that if
the Lessee elects to terminate the Lease and to purchase the Aircraft pursuant
to Section 4.02(a)(A), (D) or (E) of the Lease, and so long as no Event of
Default shall have occurred and be continuing then, upon compliance with the
applicable provisions of said Section 4.02(a) of the Lease, the Owner Trustee
will transfer to the Lessee, without recourse or warranty (except as to the
absence of Lessor's Liens attributable to the Owner Trustee) but subject to
the Lien of the Indenture, all of the Owner Trustee's right, title and
interest in and to the Aircraft, and if the Lessee, in connection with such
purchase, elects pursuant to Section 4.02(a)(A), (D) or (E) of the Lease to
assume the obligations of the Owner Trustee to the Indenture Trustee and the
Holders under the Indenture, the Certificates and hereunder, then the Lessee
shall so notify the Indenture Trustee (such notice to be given at least 30 and
not more than 60 days prior to the effective date of such assumption), and
each of the parties shall execute and deliver appropriate documentation
permitting the Lessee to assume such obligations on the basis of full recourse
to the Lessee, maintaining for the benefit of the Holders the security
interest in the Aircraft created by the Indenture, and upon compliance with the
provisions of this Section 7.11 releasing the Owner Participant and the Owner
Trustee from all obligations in respect of the Certificates, the Indenture,
this Agreement and the other Operative Agreements, except any obligations
relating to the period prior to such assumption and take all such other
actions, at the Lessee's expense, as are reasonably necessary to permit such
assumption by the Lessee.
(b) In connection with such assumption:
(i) the Lessee shall execute and deliver an instrument satisfactory
in form and substance to the Indenture Trustee (A) pursuant to which the
Lessee irrevocably and unconditionally assumes and undertakes, with full
recourse to the Lessee, to pay, satisfy and discharge when and as due (at
the stated maturity thereof, by acceleration or otherwise) the principal
of, Make-Whole Premium, if any, interest and all other sums owing on all
Outstanding Certificates (or on the Lessee's substituted obligations) in
accordance with their terms and to punctually perform and observe all of
the covenants and obligations hereunder and under the Indenture and the
Certificates (as the same may be amended in connection with such
assumption) to be performed or observed by the Owner Trustee and (B) which
contains amendments to the Indenture, in form and substance satisfactory to
the Holders and the Indenture Trustee, that incorporate therein such
provisions from the Lease and this Agreement as may be appropriate,
including, without limitation, events of default substantially identical in
scope and effect to those set forth in the Lease and covenants
substantially identical to the covenants of the Lessee hereunder and under
the Lease;
(ii) the instrument referred to in paragraph (i) of this Section
7.11(b), any Uniform Commercial Code financing statements relating thereto,
and any other documents which shall be necessary (or reasonably requested
by the Indenture Trustee) to establish the Lessee's title to and interest
in the Aircraft or to reflect the substitution of the Lessee for the Owner
Trustee under the Operative Agreements or to continue the perfection of the
security interests in the Aircraft and the other rights, Property and
interests included in the Trust Indenture Estate for the benefit of the
Holders (or the Lessee's substituted obligations) shall be filed in such
form, manner and places as are necessary or, in the reasonable opinion of
the Indenture Trustee, advisable for such purpose;
(iii) the Indenture Trustee shall have received an insurance report
dated the effective date of such assumption of an independent insurance
broker and certificates of insurance, each in form and substance
satisfactory to the Indenture Trustee, as to the due compliance as of the
effective date of such assumption with the terms of Article 13 of the Lease
(as it relates to the Indenture Trustee) relating to the insurance with
respect to the Aircraft;
(iv) the Indenture Trustee shall have received evidence that as of
the effectiveness of the assignment on the date of such assumption the
Aircraft is free and clear of all Liens other than the Lien of the
Indenture and other Permitted Liens;
(v) the Indenture Trustee shall have received a certificate from the
Lessee that no Event of Default shall have occurred and be continuing as of
the effective date of such assumption; and
(vi) the Indenture Trustee shall have received (A) from counsel for
the Lessee (who may be the Lessee's General Counsel) a legal opinion, in
form and substance satisfactory to the Indenture Trustee (w) with respect
to the compliance of the assumption contemplated hereby with the terms,
provisions and conditions hereof, (x) with respect to the due
authorization, execution, delivery, validity and enforceability of the
instrument referred to in paragraph (i) of this Section 7.11(b), (y) with
respect to the continued perfection of the first and prior Lien and security
interest in the Aircraft for the benefit of the Holders of the Certificates
(or the Lessee's substituted obligations) referred to in paragraph (ii) of
this Section 7.11(b) and (z) with respect to the continued availability of
the benefits of Section 1110 of the Bankruptcy Code to the Indenture
Trustee for the benefit of the Holders with respect to the Aircraft after
giving effect to such assumption, (B) from counsel to the Indenture Trustee
and Special Aviation Counsel, a legal opinion comparable to the respective
opinions delivered on the Delivery Date with such changes therein as may be
appropriate in light of such assumption, and (C) in the case of each opinion
described in clause (A) or (B) above, covering such additional matters as
the Indenture Trustee shall reasonably request.
(c) The Lessee shall pay all reasonable expenses (including
reasonable fees and expenses of counsel) of the Indenture Trustee, the Owner
Trustee, the Pass Through Trustee and the Owner Participant in connection with
such assumption.
Section 7.12. Indebtedness of Owner Trustee. So long as the
Indenture is in effect, the Owner Trustee, not in its individual capacity, but
solely as trustee under the Trust Agreement, shall not incur any indebtedness
for borrowed money except as expressly contemplated herein or in any other
Operative Agreement (excluding the Tax Indemnity Agreement) and shall not
engage in any business or other activity other than the transactions
contemplated herein or in any other Operative Agreement (excluding the Tax
Indemnity Agreement) and all necessary or appropriate activity related thereto.
Section 7.13. Compliance with Trust Agreement, Etc. Each of the
Owner Participant, FSB and the Owner Trustee agrees with the Lessee, the
Indenture Trustee and the Pass Through Trustee that so long as the Lien of the
Indenture shall be in effect it will (i) comply with all of the terms of the
Trust Agreement applicable to it in its respective capacity, the noncompliance
with which would materially adversely affect any such party and (ii) not take
any action, or cause any action to be taken, to amend, modify or supplement
any other provision of the Trust Agreement in a manner that would materially
adversely affect any such party without the prior written consent of such
party. The Owner Trustee confirms for the benefit of the Lessee, the
Indenture Trustee and the Pass Through Trustee that it will comply with the
provisions of Article 2 of the Trust Agreement. Notwithstanding anything else
to the contrary in the Trust Agreement, so long as the Lease remains in
effect, the Owner Participant agrees not to terminate or revoke the trust
created by the Trust Agreement without the consent of the Lessee. If and so
long as the Indenture shall not have been discharged the consent of the
Indenture Trustee shall also be required prior to any termination or
revocation of such trust and in addition, the Owner Participant will, at the
Lessee's expense, promptly and duly execute and deliver to the Indenture
Trustee such documents and assurances including, without limitation,
conveyances, financing statements and continuation statements with respect to
financing statements and take such further action as the Indenture Trustee may
from time to time reasonably request and furnish in order to protect the
rights and remedies created or intended to be created in favor of the
Indenture Trustee under the Indenture and to create for the benefit of the
Certificate Holders a valid first priority Lien with respect to, and a first
and prior perfected security interest in, the Trust Indenture Estate.
ARTICLE 8
TAXES
Section 8.01. Lessee's Obligation to Pay Taxes. (a) Generally. The
Lessee agrees promptly to pay when due, and to indemnify and hold each
Indemnitee harmless from all license, recording, documentary, registration and
other fees and all taxes (including, without limitation, income, gross
receipts, sales, rental, use, value added, property (tangible and intangible),
ad valorem, excise and stamp taxes), fees, levies, imposts, recording duties,
duties, charges, assessments or withholdings of any nature whatsoever,
together with any assessments, penalties, fines, additions to tax or interest
thereon (individually, a "Tax," and collectively called "Taxes"), however
imposed or asserted (whether imposed upon any Indemnitee, the Lessee, all or
any part of the Aircraft, Airframe, any Engine or any Part or the Lessor's
Estate, the Trust Indenture Estate, Rent, the Certificates or otherwise upon
or with respect to any Operative Agreement or Original Agreement, any payments
thereunder or otherwise in connection therewith), by any Federal, state or
local government or taxing authority in the United States, or by any
government or taxing authority of a foreign country or of any political
subdivision or taxing authority thereof or by a territory or possession of the
United States or an international taxing authority relating to or measured by:
(i) the construction, mortgaging, financing, refinancing, purchase,
acceptance, rejection, delivery, nondelivery, transport, location, ownership,
registration, reregistration, deregistration, insuring, assembly, possession,
repossession, operation, use, non-use, condition, maintenance, repair,
improvement, conversion, sale, return, abandonment, preparation, installation,
storage, redelivery, replacement, manufacture, leasing, subleasing,
sub-subleasing, modification, alteration, rebuilding, importation, transfer of
title, transfer of registration, exportation or other application or
disposition of, or the imposition of any Lien (or the incurrence of any
liability to refund or pay over any amount as a result of any Lien) on, the
Aircraft, the Airframe, any Engine or any Part or any interest therein;
(ii) amounts payable under the Operative Agreements or Original
Agreements;
(iii) the Property, or the income or other proceeds received with
respect to the Property attributable to the transactions contemplated by
the Operative Agreements or the Original Agreements, held by the Owner
Trustee under the Trust Agreement or after an Event of Default under the
Lease, or by the Indenture Trustee under the Indenture;
(iv) otherwise with respect to any Operative Agreement or Original
Agreement, any interest therein or by reason of the transactions described
in or contemplated by the Operative Agreements or the Original Agreements;
(v) the principal or interest or other amounts payable with respect
to the Original Loan Certificates, the Pass Through Certificates or the
Certificates;
(vi) the Original Loan Certificates, the Pass Through Certificates or
the Certificates or the issuance, sale, acquisition, reoptimization, or
refinancing thereof or the beneficial interests in the Trust Estate or the
Trust Indenture Estate or the creation thereof under the Trust Agreement or
the Indenture, or the security interest created or perfected thereby or by
any filing thereof;
(vii) any assumption by the Lessee pursuant to Section 7.11 of this
Agreement and Section 2.12 of the Indenture;
(viii) the Aircraft, the Airframe, any Engine or any Part; or
(ix) the rentals (including Basic Rent, Renewal Rent and Supplemental
Rent), receipts or earnings arising from the Operative Agreements or the
Original Agreements.
(b) Exceptions. The indemnity provided for in Section 8.01(a) shall
not extend to any of the following:
(i) With respect to an Indemnitee other than an Original Loan
Participant, Taxes based upon, measured by or with respect to the net or
gross income, items of tax preference or minimum tax or excess profits,
receipts, value-added taxes, capital, franchise, net worth (whether
denominated income, excise, capital stock, or doing business taxes) or
other similarly-based taxes (other than sales, use, transfer, rental, ad
valorem, stamp, property, or similar taxes) ("Income Taxes"), provided,
however, that this clause (i) shall not exclude from the indemnity
described in Section 8.01(a) above any such Income Taxes to the extent such
taxes are imposed by any jurisdiction in which the Indemnitee would not be
subject to such taxes but for, or would be subject to such taxes solely as
a result of, (x) the operation, registration, location, presence, or use of
the Aircraft, Airframe, any Engine or any Part thereof, in such
jurisdiction or (y) the place of incorporation or principal office or the
activities of the Lessee or any sublessee in such jurisdiction (it being
understood that (A) any such indemnity would be payable only to the extent
of the net harm incurred by the Indemnitee from such Income Taxes, taking
into account any incremental current Tax benefit in another tax
jurisdiction resulting from payment of such Income Taxes and (B) this
sentence would require indemnification in a jurisdiction in which the
Indemnitee is already subject to an Income Tax (an "Existing Income Tax")
only if an event set forth in Clause (x) or (y) of this sentence causes the
Indemnitee to be subject to an Income Tax in that jurisdiction (a "New
Income Tax") other than an Existing Income Tax, and such New Income Tax
would have been imposed even if the activities contemplated by the
Operative Agreements or the Original Agreements were the Indemnitee's sole
nexus to the jurisdiction); provided, further, that the provisions of this
paragraph (b)(i) relating to Income Taxes shall not exclude from the
indemnity described in Section 8.01(a) hereof any Income Taxes for which
the Lessee would be required to indemnify an Indemnitee (x) so that any
payment under the Operative Agreements or the Original Agreements,
otherwise required to be made on an After-Tax Basis, is made on an
After-Tax Basis or (y) pursuant to the last sentence of Section 8.02, 8.05,
9.02 or 9.05 of this Agreement;
(ii)With respect to an Original Loan Participant, Income Taxes (other
than in the case of a Non-U.S. Person, U.S. federal withholding taxes on
amounts payable with respect to such Original Loan Participant's Loan
Certificate) except to the extent such Income Tax is imposed (including by
way of increase) by any jurisdiction in which the Indemnitee is subject to
tax (A) on or with respect to any gain resulting from the assumption of any
Loan Certificate by the Lessee, (B) as a result of the operation,
registration, location, presence, basing or use of the Aircraft, Airframe,
any Engine or any Part thereof, in such jurisdiction (it being understood
that (I) the incremental Income Taxes described in this clause (B) shall
not include any U.S. Federal income taxes and (II) that to the extent such
incremental Income Taxes give rise to any incremental current Tax benefit in
another tax jurisdiction, that such incremental benefit shall offset and
decrease the incremental Income Taxes determined under this clause (B)) or
(C) solely as a result of the place of incorporation, principal office,
corporate domicile or the activities of the Lessor, Owner Participant, the
Owner Trustee, the Indenture Trustee, the Lessee or any sublessee in such
jurisdiction (it being understood that to the extent that any Income Taxes
described under this clause (C) give rise to any incremental current Tax
benefit in another tax jurisdiction or another tax period, that such
incremental Tax benefit shall offset and decrease the Income Taxes
determined under this clause (C)); provided, however, that the provisions
of this paragraph (b)(ii) relating to Income Taxes shall not exclude from
the indemnity described in Section 8.01(a) any Income Taxes for which the
Lessee would be required to indemnify an Indemnitee (x) so that any payment
under the Operative Agreements, otherwise required to be made on an
After-Tax Basis, is made on an After-Tax Basis or (y) pursuant to the last
sentence of Section 8.02 of this Agreement;
(iii)Taxes imposed with respect to the Aircraft and arising out of or
measured by acts, omissions, events or periods (or any combination of the
foregoing) which occur after the later of (A) the payment in full of all
amounts payable by the Lessee pursuant to and in accordance with the
Operative Agreements, or the earlier discharge in full of the Lessee's
payment obligations under and in accordance with the Lease and the
Operative Agreements (and the Original Loan Certificates in the case of an
Original Loan Participant, the Indenture Trustee or the Trust Indenture
Estate if the Lessee shall have assumed the Certificates pursuant to
Section 7.11 of this Agreement), and (B) the earliest of (x) the expiration
of the Term of the Lease and return of the Aircraft in accordance with
Article 12 of the Lease, (y) the termination of the Lease in accordance with
the applicable provisions of the Lease and return of the Aircraft in
accordance with the Lease, or (z) the termination of the Lease in
accordance with the applicable provisions of the Lease and the transfer of
all right, title and interest in the Aircraft to the Lessee pursuant to its
exercise of any of its purchase options set forth in Section 4.02(a) of the
Lease, provided that this exclusion (iii) shall not apply in respect of any
payment made after the dates set forth in clauses (A) and (B) above unless
such payment is made with respect to any event or circumstance occurring
on, with or prior to such return or transfer or period prior to such return
or transfer, or Taxes incurred in connection with the exercise of any
remedies pursuant to Article 17 of the Lease following the occurrence of an
Event of Default;
(iv)As to the Owner Trustee, Taxes imposed against the Owner Trustee
upon or with respect to any fees for services rendered in its capacity as
Owner Trustee under the Original Trust Agreement or the Trust Agreement or,
as to the Indenture Trustee, Taxes imposed against the Indenture Trustee
upon or with respect to any fees received by it for services rendered in
its capacity as Indenture Trustee under the Original Indenture or the
Indenture;
(v) Taxes imposed on an Indemnitee that would not have been imposed
but for the willful misconduct or gross negligence of such Indemnitee
(other than gross negligence or willful misconduct not actually committed
by but instead imputed to such Indemnitee by reason of such Indemnitee's
participation in the transactions contemplated by the Operative Agreements
or the Original Agreements) or the breach by such Indemnitee of: (i) in the
case of an Indemnitee other than the Owner Participant, any representation,
warranty or covenant contained in the Operative Agreements or the Original
Agreements or any document delivered in connection therewith and (ii) in
the case of the Owner Participant, the representations or covenants in
Sections 7.02(a), (c); 7.03(a)(i), (ii), (iii), (iv), (vii), (ix); and
7.03(b), (c), (d), (e) of the Original Participation Agreement or this
Agreement (in either case unless attributable to a breach of representation,
warranty or covenant of the Lessee);
(vi)Taxes imposed on, and not collected by withholding from payments
of Rent, the Owner Trustee or the Owner Participant or any successor,
assign or Affiliate thereof which became payable by reason of any voluntary
or involuntary transfer or disposition by such Indemnitee subsequent to the
Delivery Date, including revocation of the Trust, of any interest in some
or all of the Aircraft, Airframe, Engines or Parts thereof or its interest
in the Lessor's Estate (not including any transfers of any Certificates
pursuant to Section 15.01(a) hereof) or a disposition in connection with a
bankruptcy or similar proceedings involving either the Lessor or the Owner
Participant other than (A) transfers resulting from a loss, substitution or
modification of the Aircraft, Engines or any Part, (B) any transfer of the
Aircraft, Engines or any Part (in each case other than at Fair Market
Value) to the Lessee or other person in possession thereof, (C) transfers
attributable to an Event of Default or (D) a transfer pursuant to the
Lessee's exercise of its rights under Section 10.01 of the Lease; the
parties agree to cooperate to minimize any such Taxes covered by this
provision;
(vii)Taxes imposed on the Owner Participant for which the Lessee is
obligated to indemnify the Owner Participant pursuant to the Tax Indemnity
Agreement;
(viii)Taxes imposed on a successor, assign or other transferee of the
Owner Participant or the Owner Trustee that is not a U.S. Person or of any
other Indemnitee under the Original Agreements or an Indemnitee as of the
date hereof under the Operative Agreements (including, without limitation,
a transferee which is a new lending office of an original Indemnitee) which
on the Delivery Date is an Indemnitee (for purposes of this clause (viii),
an "original Indemnitee") or such original Indemnitee to the extent that
such Taxes exceed the amount of Taxes that would have been imposed (in the
case of an Original Loan Participant, immediately after giving effect to
such succession, assignment or other transfer) and would have been
indemnifiable pursuant to Section 8.01(a) had there not been a succession,
assignment or other transfer by such original Indemnitee of any such
interest of such Indemnitee in the Aircraft or any Part, any interest in or
under any Operative Agreement, or any proceeds thereunder (it being
understood that for purposes of determining the amount of indemnification
that would have been due to such original Indemnitee with respect to a net
income Tax, it shall be assumed that such original Indemnitee would be
subject to taxation on its income at the highest marginal statutory rate
applicable to it), provided, however, that the exclusion provided by this
clause (viii) shall not apply in the case of a succession, transfer or
disposition (A) that occurs after the Lease has been declared in default
or if such transfer or disposition is pursuant to the exercise of remedies
under Article 17 of the Lease, (B) which is an actual or deemed transfer
pursuant to Section 7.11 hereof or as a consequence of a Refinancing under
Section 15.01 hereof, or any actual or deemed transfer of an Original Loan
Certificate that as part of a Refinancing under Section 15.01 hereof is not
retired, but only to the extent the Taxes attributable to such transfer
exceed the amount of Taxes that would have been imposed on such transferor
if the debt had instead been retired, (C) to the extent necessary to make
payments with respect to such Taxes on an After-Tax Basis, (D) to the
extent such Taxes are directly attributable to the failure of the Lessee to
take administrative actions as have been reasonably requested of it in
writing in a timely manner and which will result in no after-tax cost or
expense to the Lessee or (E) in the case of the Owner Participant or the
Lessor, to any Tax other than an Income Tax;
(ix)[Intentionally Left Blank];
(x) Any Taxes which have been included in the Purchase Price and which
have been paid to the applicable taxing authorities;
(xi)Any Taxes which would not have been imposed but for a Lessor's
Lien or an Indenture Trustee's Lien; and
(xii)Any Taxes imposed on the Owner Participant arising under or in
connection with any prohibited transaction, within the meaning of Section
406 of ERISA or Section 4975(c)(1) of the Code ("Prohibited Transaction");
provided, however, that in the event any prohibited transaction arises
which is not exempt under any class prohibited transaction exemption or any
individual or statutory prohibited transaction exemption (individually or
collectively, a "PTE") then the indemnity provided for herein shall extend
to any Taxes incurred by the Owner Participant (or any Affiliate thereof)
as the result of any Prohibited Transaction arising out of the purchase or
holding of any Loan Certificates by an employee benefit plan subject to
Title I of ERISA or by a plan subject to Section 4975 of the Code
(individually or collectively, an "ERISA Plan") with respect to which the
Owner Participant is a party in interest, within the meaning of Section
3(14) of ERISA, or a disqualified person,within the meaning of Section 4975
of the Code, except, however, that such Indemnity shall not extend to any
Taxes incurred by the Owner Participant (or any Affiliate thereof) as the
result of any Prohibited Transaction occurring with respect to the purchase
or holding of any Loan Certificates (A) over which purchase or holding the
Owner Participant (or an Affiliate thereof) has discretion or control
(other than in the capacity of a custodian, directed trustee or other
similar nondiscretionary capacity), or (B) by an ERISA Plan with respect to
which the Owner Participant (or any Affiliate thereof) is a "plan sponsor"
within the meaning of Section 3(16)(B) of ERISA.
(c) Withholding. The Pass Through Trustee shall withhold any Taxes
required to be withheld on payments to any holder of a Pass Through
Certificate who is a Non-U.S. Person except to the extent that such a holder
of a Pass Through Certificate has furnished evidence to the Pass Through
Trustee sufficient under applicable law to entitle such holder of a Pass
Through Certificate to any exemption from or reduction in the rate of
withholding on interest claimed by such holder of a Pass Through Certificate.
The Indenture Trustee shall withhold any Taxes required to be withheld on any
payment to a Holder pursuant to Section 5.09 of the Indenture. If the
Indenture Trustee or the Pass Through Trustee fails to withhold a Tax required
to be withheld with respect to any Holder of a Certificate or any holder of a
Pass Through Certificate or any claim is otherwise asserted by a taxing
authority against the Owner Trustee or Owner Participant for any withholding
tax, the Lessee will indemnify the Owner Trustee and the Owner Participant
(without regard to the exclusions set forth in Section 8.01(b) hereof) on an
After-Tax Basis against any such Taxes required to be withheld and any
interest and penalties with respect thereto, along with any other costs
(including reasonable attorney's fees) incurred in connection with any such
claim. The Indenture Trustee or the Pass Through Trustee, as the case may be,
in its individual capacity (and without recourse to the Trust Indenture
Estate), shall indemnify the Lessee (without regard to the exclusions set
forth in Section 8.01(b) hereof) on an After-Tax Basis for any payment the
Lessee shall have made pursuant to the preceding sentence.
Section 8.02. After-Tax Basis. The amount which the Lessee shall be
required to pay with respect to any Tax indemnified against under Section 8.01
shall be an amount sufficient to restore the Indemnitee, on an After-Tax
Basis, to the same position such party would have been in had such Tax not
been incurred, provided that the calculation of any additional amounts owing
to any Indemnitee as a result of the Lessee's obligation to indemnify on an
After-Tax Basis shall be made without regard to the exclusions set forth in
Section 8.01(b). If any Indemnitee actually realizes a tax benefit by reason
of the payment of any Tax paid or indemnified against by the Lessee, such
Indemnitee shall promptly pay to the Lessee, to the extent such tax benefit was
not previously taken into account in computing such payment, but not before the
Lessee shall have made all payments then due to such Indemnitee under this
Agreement, the Tax Indemnity Agreement and any other Operative Agreement, an
amount equal to the lesser of (x) the sum of such tax benefit plus any other
tax benefit actually realized by such Indemnitee that would not have been
realized but for any payment made by such Indemnitee pursuant to this sentence
and not already paid to the Lessee, and (y) the amount of the payment made
under Section 8.01 hereof and this Section 8.02 by the Lessee to such
Indemnitee plus the amount of any other payments by the Lessee to such
Indemnitee theretofore required to be made under this Section 8.02 and
Sections 8.01 and 8.05 hereof (and the excess, if any, of the amount described
in clause (x) above over the amount described in clause (y) above shall be
carried forward and applied to reduce pro tanto any subsequent obligations of
the Lessee to make payments to such Indemnitee pursuant to Section 8.01
hereof); provided, however, that notwithstanding the foregoing portions of
this sentence, such Indemnitee shall not be obligated to make any payment to
the Lessee pursuant to this sentence as long as an Event of Default shall have
occurred and be continuing under the Lease. The Lessee shall reimburse on an
After-Tax Basis such Indemnitee (and without regard to Section 8.01(b) hereof,
except for clause (v) thereof) for any payment of a tax benefit pursuant to
the preceding sentence (or a tax benefit otherwise taken into account in
calculating the Lessee's indemnity obligation hereunder) to the extent that
such tax benefit is subsequently disallowed or reduced (including the
expiration of any tax credit carryovers or carrybacks of such Indemnitee that
would not otherwise have expired).
Section 8.03. Time of Payment. Any amount payable to an Indemnitee
pursuant to this Article 8 shall be paid promptly, but in any event within 30
days after receipt of a written demand therefor from such Indemnitee
accompanied by a written statement describing in reasonable detail the basis
for such indemnity and the computation of the amount so payable, provided that
in the case of amounts which are being contested by the Lessee in good faith
or by the Indemnitee in either case pursuant to Section 8.04 hereof, such
amount shall be payable within 30 days after the time such contest is finally
resolved.
Section 8.04. Contests. If a written claim is made against any
Indemnitee for Taxes with respect to which the Lessee is liable for a payment
or indemnity hereunder, such Indemnitee shall promptly (but in any event
within 30 days of receipt thereof) give the Lessee notice in writing of such
claim and shall furnish the Lessee with copies of any written requests for
information sent to such Indemnitee (and not the Lessee) from any taxing
authority to the extent relating to such Taxes with respect to which the
Lessee may be required to indemnify hereunder and with respect to which it
would be necessary or beneficial to have information provided by the Lessee;
provided, however, that the failure of an Indemnitee to give such notice or
furnish such copy shall not terminate any of the rights of such Indemnitee
under this Article 8, except to the extent that the Lessee's contest rights
have been materially and adversely impaired by the failure to provide such
notice or copy. The Lessee may, at its option, contest in its own name or, if
required by law, require the Indemnitee to contest in good faith, with due
diligence and at the Lessee's expense, if timely requested in writing by the
Lessee, the validity, applicability or amount of such Taxes by:
(i) resisting payment thereof if lawful and practicable or not
paying the same except under protest if protest is necessary and proper in
each case so long as non-payment will not result in a material risk of the
sale, forfeiture or loss of, or the creation of a Lien other than a
Lessor's Lien on the Aircraft, Airframe or any Engine or any risk of
criminal liability; or
(ii) if the payment be made, using reasonable efforts to obtain a
refund thereof in appropriate administrative and judicial proceedings.
Notwithstanding the foregoing, the Lessee shall not be permitted or entitled
to contest any such Tax in its own name unless the Tax is reflected in a
report or a return of the Lessee or raised in an audit or other proceeding of
the Lessee and the Lessee is allowed to directly contest such Tax under
applicable law of the taxing jurisdiction provided, that if the Lessee is so
permitted under applicable law to contest a Tax asserted against the Lessee
and the same or similar Tax is also asserted against the Indemnitee, each of
the Lessee and such Indemnitee shall conduct its contest in its own name and
the Lessee and such Indemnitee will cooperate in a reasonable manner with
respect to the respective contests of such Tax.
If the Indemnitee, after reasonable discussion with the Lessee and
consideration in good faith of any suggestion made by the Lessee as to the
method of pursuing such contest, elects to conduct the contest, such
Indemnitee shall control the contest and shall determine the manner in which
to contest such Taxes and shall periodically or upon the Lessee's request
advise the Lessee of the progress of such contest; provided, however, that the
Lessee shall have the right to be consulted in good faith with respect to any
contest of claims subject to indemnification hereunder, including governmental
and judicial conferences and the right to be consulted in good faith regarding
the relevant portions of all related submissions to any governmental or other
authority, provided, however, that the Lessee shall be permitted to
participate in any such contest only (x) with respect to issues that can be
separated on audit from any Taxes for which the Lessee is not required to
indemnify the Indemnitee hereunder, and (y) if the Indemnitee shall have
determined that in its judgment, exercised in its sole discretion, neither
such participation nor the separation of issues will adversely affect the
Indemnitee. The Indemnitee will not settle a contest that results in a final
determination without consent of the Lessee, unless the Indemnitee waives its
right to indemnification with respect to such contest and any related contest.
Notwithstanding the preceding sentences of this Section 8.04, such Indemnitee
shall not be required to take or continue any action unless the Lessee shall
have (i) agreed in writing to pay and shall pay the Indemnitee on a current
basis and on an After-Tax Basis the after-tax cost of all reasonable fees and
expenses (including reasonable attorneys' fees and accountants' fees) which
such Indemnitee may incur as a result of contesting such Taxes, (ii) made all
payments and indemnities (other than contested payments and indemnities) then
due to the Indemnitee hereunder or with respect to any of the transactions
contemplated by or under the Operative Agreements and (iii) acknowledged in
writing the Lessee's obligation to such Indemnitee pursuant to this Agreement
to the extent that the contest is not successful, unless it is reasonably
clear from the resolution of the contest that an exclusion set forth in
Section 8.01(b) hereof applies. In no event shall such Indemnitee be required
or the Lessee be permitted to contest pursuant to this Section 8.04 the
imposition of any Tax for which the Lessee is obligated to indemnify any
Indemnitee hereunder unless (i) such Indemnitee shall have received, at the
Lessee's expense, an opinion of its tax counsel, such counsel to be reasonably
satisfactory to the Lessee ("Tax Counsel"), to the effect that there exists a
reasonable basis for contesting such claim, (ii) such Indemnitee (and, if such
Indemnitee is not the Owner Participant, the Owner Participant and such
Indemnitee) shall have determined that such contest will not result in any
material risk of loss, sale or forfeiture of, or the creation of a Lien (other
than Lessor's Liens) on, the Aircraft or any part thereof or interest thereon
or in a risk of criminal liability, or adversely affect the Trust Indenture
Estate, (iii) if a Payment Default, Bankruptcy Default or an Event of Default
shall have occurred and be continuing, the Lessee shall have provided security
for its obligations hereunder reasonably satisfactory to the Indemnitee, (iv)
if such contest shall be conducted in a manner requiring payment of the claim
in advance, the Lessee shall have advanced sufficient funds, on an interest
free basis, to make the payment required, and agreed to indemnify the
Indemnitee against any additional net adverse tax consequences on an After-Tax
Basis to such Indemnitee of such advance, (v) the issue shall not be the same
as an issue previously contested hereunder and decided adversely, unless the
Indemnitee shall have received at the Lessee's sole expense, a written
opinion, in form and substance reasonably satisfactory to such Indemnitee, of
Tax Counsel to the effect that the applicable circumstances or law has changed
and that in light thereof, there is substantial authority for contesting such
claim and (vi) the amount of the indemnity payments the Lessee would be
required to make with respect to such adjustment, when aggregated with similar
adjustments that could be raised in other taxable years of such Indemnitee
exceeds $50,000; provided, that in the event that such Indemnitee is not
required under this paragraph to contest any Tax liability for which the
Lessee is obligated to indemnify any Indemnitee, the Lessee may contest such
Tax liability in the name of the Lessee, if permitted by law. The Lessee may
appeal or require the Indemnitee to appeal any judicial decision provided the
foregoing requirements of this Section 8.04 are met and the Indemnitee shall
have received, at the Lessee's expense, an opinion of Tax Counsel, to the
effect that there is substantial authority for such appeal.
Nothing contained in this Section 8.04 shall require any Indemnitee to
contest or continue to contest, or permit Lessee to contest, a claim which such
Indemnitee would otherwise be required to contest pursuant to this Section
8.04, if such Indemnitee shall waive payment by Lessee of any amount that
might otherwise be payable by Lessee under this Article 8 in connection with
such claim.
Section 8.05. Refunds. Upon receipt by an Indemnitee of a refund of
all or any part of any Taxes which the Lessee shall have paid for such
Indemnitee or for which the Lessee shall have reimbursed or indemnified such
Indemnitee, and provided there shall not have occurred and be continuing any
Payment Default, Bankruptcy Default or Event of Default by the Lessee
hereunder or under the Lease (in which case payment shall not be made to the
Lessee until such Payment Default, Bankruptcy Default or Event of Default
shall have been cured), such Indemnitee shall pay to the Lessee an amount
equal to the amount of such refund less (x) any expenses not previously
reimbursed, (y) all payments then due to such Indemnitee under this Article
8 and (z) Taxes imposed with respect to the accrual or receipt thereof,
including interest received attributable thereto, plus any tax benefit
actually realized by such Indemnitee as a result of any payment by such
Indemnitee made pursuant to this sentence; provided, however, that such amount
shall not be payable (a) before such time as the Lessee shall have made all
payments or indemnities then due and payable to such Indemnitee under this
Article 8 and (b) to the extent that the amount of such payment would exceed
(i) the amount of all prior payments by the Lessee to such Indemnitee pursuant
to this Article 8 less (ii) the amount of all prior payments by such
Indemnitee to the Lessee pursuant to this Article 8.
Any subsequent loss of such refund or tax benefit shall be treated as
a Tax subject to indemnification under the provisions of this Article 8 (in
the case of any such tax benefit, without regard to Section 8.01(b) hereof).
Section 8.06. Lessee's Reports. In case any report or return is
required to be made with respect to any Taxes against which the Lessee is or
may be obligated to indemnify the Indemnitees under this Article 8, the Lessee
shall make such report or return, except for any such report or return that
the Indemnitee has notified the Lessee that it intends to file, in such manner
as will show the ownership of the Aircraft in the Owner Trustee and shall send
a copy of the applicable portions of such report or return to the Indemnitee
and the Owner Trustee or will notify the Indemnitee of such requirement and
make such report or return in such manner as shall be satisfactory to such
Indemnitee and the Owner Trustee. The Lessee will provide such information
reasonably available to the Lessee as the Indemnitee may reasonably require
from the Lessee to enable the Indemnitee to fulfill its tax filing
requirements with respect to the transactions contemplated by the Operative
Agreements (without duplication of the requirements of Section 3 of the Tax
Indemnity Agreement) and any audit information request arising from any such
filing. The Indemnitee will provide such information reasonably available to
it as the Lessee may reasonably require from such Indemnitee to enable the
Lessee to fulfill its tax filing requirements with respect to the transactions
contemplated by the Operative Agreements and any audit information request
arising from such filing; provided that in no event shall any Indemnitee be
required to provide copies of any of its tax returns or other confidential
information. The Lessee shall hold the Indemnitee harmless on an After-Tax
Basis from and against any liabilities, including penalties, additions to tax,
fines and interest, imposed upon or incurred by such Indemnitee to the extent
directly attributable to any insufficiency or inaccuracy in any return,
statement, or report prepared by the Lessee or information supplied by the
Lessee, or directly attributable to the Lessee's failure to supply reasonably
available information to such Indemnitee as required by this Section 8.06.
Section 8.07. Survival of Obligations. The representations,
warranties, indemnities and agreements of the Lessee provided for in this
Article 8 and the Lessee's obligations under any and all of them shall survive
the expiration or other termination of the Operative Agreements.
Section 8.08. Payment of Taxes. With respect to any Tax otherwise
indemnifiable hereunder by the Lessee and applicable to the Aircraft,
Airframe, any Engine or Parts, to the extent permitted by the applicable
federal, state, local or foreign law, the Lessee shall pay such tax directly
to the relevant Taxing authority and file any returns or reports required with
respect thereto to the extent legally entitled to do so in its own name;
provided, however, that the Lessee shall not make any statements or take any
action which would indicate that the Lessee or any Person other than the Owner
Trustee or Owner Participant is the owner of the Aircraft, the Airframe, any
Engine or any Part or which would otherwise be inconsistent with the terms of
the Lease or the Tax Indemnity Agreement and the position thereunder of the
Owner Trustee and the Owner Participant. Copies of such returns or reports,
together with evidence of payment of any tax due, shall be sent by the Lessee
to the Owner Participant within thirty (30) days after the date of each
payment by the Lessee of any Tax.
Section 8.09. Reimbursements by Indemnitees Generally. To the
extent the Lessee is required to pay or withhold any Tax imposed on or with
respect to an Indemnitee in respect of the transactions contemplated by the
Operative Agreements, which Tax is not otherwise the responsibility of the
Lessee under the Operative Agreements, or any other written agreements between
the Lessee and such Indemnitee, then such Indemnitee shall pay to the Lessee
within 30 days of the Lessee's demand therefor an amount which equals the
amount actually paid by Lessee with respect to such Taxes.
Section 8.10. Obligations of Lessee Unsecured. The obligations of
the Lessee to the Original Loan Participants under this Article 8 shall
constitute unsecured obligations of the Lessee to such Original Loan
Participants and are not secured by the Lien of the Indenture or the Original
Indenture.
ARTICLE 9
GENERAL INDEMNITY
Section 9.01. Generally. (a) The Lessee agrees to indemnify each
Indemnitee against and agrees to protect, defend, save and keep harmless each
Indemnitee from any and all liabilities, obligations, losses, damages,
penalties, claims, actions, suits, costs, disbursements and expenses
(including legal fees and expenses and all costs and expenses relating to
amendments, supplements, adjustments, consents, refinancings and waivers under
the Operative Agreements and the Original Agreements except as otherwise
provided in Section 10.01(d)(i) or Article 15 hereof) of every kind and
nature, including without limitation Make-Whole Premium (unless excluded
pursuant to Section 3.03 of the Lease) (whether or not any of the transactions
contemplated by this Agreement are consummated) (individually, an "Expense,"
collectively, "Expenses"), which may be imposed on, incurred or suffered by or
asserted against any Indemnitee, in any way relating to, based on or arising
out of:
(i) the Original Agreements, this Agreement, the Lease, the
Indenture, the Trust Agreement, the Pass Through Agreement, AVSA's FAA ▇▇▇▇
of Sale, AVSA's Warranty ▇▇▇▇ of Sale or any other Operative Agreement or
any other document entered into in connection herewith or any sublease or
transfer or any transactions contemplated hereby or thereby;
(ii) the operation, possession, use, non-use, maintenance, storage,
overhaul, delivery, non-delivery, control, repair or testing of the
Aircraft, Airframe, or any Engine or any engine used in connection with the
Airframe, or any part thereof by the Lessee, any sublessee or any other
Person whatsoever, whether or not such operation, possession, use, non-use,
maintenance, storage, overhaul, delivery, non-delivery, control, repair or
testing is in compliance with the terms of the Lease, including without
limitation, claims for death, personal injury or property damage or other
loss or harm to any Person whatsoever, including, without limitation, any
passengers, shippers or other Persons wherever located, and claims relating
to any laws, rules or regulations, including, without limitation,
environmental control, noise and pollution laws, rules or regulation;
(iii)the manufacture, design, sale, return, purchase, acceptance,
rejection, delivery, non-delivery, condition, repair, modification,
servicing, rebuilding, airworthiness, registration, reregistration, import,
export, performance, non-performance, lease, sublease, transfer,
merchantability, fitness for use, alteration, substitution or replacement
of any Airframe, Engine, or Part under the Lease, the Purchase Agreement,
the Purchase Agreement Assignment, the GTA or the Engine Warranty
Assignment or other transfer of use or possession, or other disposition of
the Aircraft, the Airframe, any Engine or any Part including, without
limitation, latent and other defects, whether or not discoverable, strict
tort liability, and any claims for patent, trademark or copyright
infringement;
(iv)any breach of or failure to perform or observe, or any other
non-compliance with, any condition, covenant or agreement to be performed,
or other obligations of the Lessee under any of the Operative Agreements or
the Original Agreements, or the falsity or inaccuracy of any representation
or warranty of the Lessee in any of the Operative Agreements or the
Original Agreements (other than representations and warranties in the Tax
Indemnity Agreement);
(v) the enforcement of the terms of the Operative Agreements or the
Original Agreements and the administration of the Trust Indenture Estate;
and
(vi)the offer, issuance, sale or delivery of any Certificate or any
Pass Through Certificate or any Original Loan Certificate, or any refunding
or refinancing thereof, or interest in the Lessor's Estate or the Trust
Agreement or the Original Trust Agreement or any similar interest or in any
way relating to or arising out of the Trust Agreement or the Original Trust
Agreement and the Lessor's Estate, the Indenture or the Original Indenture
or the Trust Indenture Estate (including, without limitation, any claim
arising out of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, or any other federal or state statute,
law or regulation, or at common law or otherwise relating to securities), or
the action or inaction of the Owner Trustee or Indenture Trustee as
trustees, in the manner contemplated by this Agreement, the Original
Participation Agreement, the Indenture, the Original Indenture, the
Indenture and Security Agreement Supplement, the Trust Agreement or the
Original Trust Agreement and in the case of the Owner Participant, its
obligations arising under Section 6.01 of the Trust Agreement or the
Original Trust Agreement.
The foregoing indemnity by the Lessee is intended to include and cover, but is
not limited to, any Expense to which the Indemnitees may be subject as a
result of their respective ownership or leasing of any interest in or holding
of any Lien on the Aircraft, Airframe, any Engine or Part during the Term,
whether or not in the Lessee's possession or control, insofar as such Expense
relates to any activity or event whatsoever involving such item while it is
under lease to the Lessee (or after termination of the Lease in connection
with the exercise of remedies thereunder to the extent that such Expense is
attributable to the transactions contemplated hereby and by the other
Operative Agreements and the Original Agreements), and such Expense does not
fall within any of the exceptions listed in Section 9.01(b) hereof.
(b) Exceptions. The indemnity provided for in Section 9.01(a) shall
not extend to any Expense of any Indemnitee to the extent it:
(i) would not have occurred but for the willful misconduct or gross
negligence of such Indemnitee;
(ii) is in respect of the Aircraft, and is attributable to acts or
events which occur after the Aircraft is no longer part of the Lessor's
Estate or, if the Aircraft remains a part of the Lessor's Estate, after the
expiration of the Term (unless the Aircraft is being returned at such time,
in which case after return of physical possession; provided that if the
Lessor has terminated the Lease pursuant to Article 17 thereof, the
indemnity provided in Section 9.01(a) hereof shall survive for so long as
Lessor shall be exercising remedies under such Article 17), or to acts or
events which occur after return of possession of the Aircraft by the Lessee
in accordance with the provisions of the Lease (subject to the foregoing
proviso if the Lessor has terminated the Lease pursuant to Article 17 of
the Lease) but in any such case only to the extent not fairly attributable
to acts or omissions of the Lessee prior to expiration of the Term,
including without limitation the Lessee's failure to fully discharge all of
its obligations under the Lease, the other Operative Agreements or the
Original Agreements;
(iii)is a Tax, whether or not the Lessee is required to indemnify
therefor pursuant to Article 8 hereof or pursuant to the Tax Indemnity
Agreement;
(iv)is a cost or expense required to be paid by the Owner Participant
or its permitted transferees (and not by the Lessee) pursuant to this
Agreement or any other Operative Agreement and for which the Lessee is not
otherwise obligated to reimburse the Owner Participant, directly or
indirectly pursuant to the terms of this Agreement or such other Operative
Agreement;
(v) would not have been incurred by such Indemnitee if such
Indemnitee had not been in breach of its representations or warranties, or
had not defaulted in the observance and performance of the terms and
provisions required to be observed and performed by it, in this Agreement,
the Purchase Agreement Assignment, the Lease, the Indenture, the Trust
Agreement, the Original Agreements or any other Operative Agreement to
which it is a party unless such breach or default shall be a result of the
breach or default by the Lessee of any of its obligations under the
Operative Agreements or by another Indemnitee of any of the foregoing;
(vi)[Intentionally Left Blank];
(vii)is, in the case of the Owner Participant, Lessor's Liens to the
extent attributable to the Owner Participant; in the case of the Owner
Trustee, Lessor's Liens to the extent attributable to the Owner Trustee; in
the case of FSB, Lessor's Liens to the extent attributable to FSB; and in
the case of the Indenture Trustee, Indenture Trustee's Liens;
(viii)is, in the case of the Owner Participant or the Owner Trustee,
attributable to the offer or sale by such Indemnitee after the Delivery
Date of any interest in the Aircraft, the Lessor's Estate or the Trust
Agreement or any similar interest (including an offer or sale resulting
from bankruptcy or other proceedings for the relief of debtors in which
such Indemnitee is the debtor), unless in each case such offer or sale
shall occur (x) in connection with a Refinancing, (y) as a result of the
occurrence of an Event of Default provided that either the Lease has been
declared in default or the transfer is pursuant to the exercise of remedies
under Article 17 of the Lease or (z) in connection with the Lessee's
exercise of its early termination option under Article 10 of the Lease or
its purchase options under Article 4 of the Lease or in connection with
Article 11 of the Lease;
(ix)is an Expense arising under or in connection with any prohibited
transaction, within the meaning of Section 406 of ERISA or Section
4975(c)(1) of the Code ("Prohibited Transaction"); provided, however, that
in the event any prohibited transaction arises which is not exempt under
any class prohibited transaction exemption or any individual or statutory
prohibited transaction exemption (individually or collectively, a "PTE")
then the indemnity provided for herein shall extend to any Expenses
incurred by the Owner Participant (or any Affiliate thereof) as the result
of any Prohibited Transaction arising out of the purchase or holding of any
Certificates by an employee benefit plan subject to Title I of ERISA or by
a plan subject to Section 4975 of the Code (individually or collectively,
an "ERISA Plan") with respect to which the Owner Participant is a party in
interest, within the meaning of Section 3(14) of ERISA, or a disqualified
person,within the meaning of Section 4975 of the Code, except, however, that
such Indemnity shall not extend to any Expenses incurred by the Owner
Participant (or any Affiliate thereof) as the result of any Prohibited
Transaction occurring with respect to the purchase or holding of any
Certificates (A) over which purchase or holding the Owner Participant (or
an Affiliate thereof) has discretion or control (other than in the capacity
of a custodian, directed trustee or other similar nondiscretionary
capacity), or (B) by an ERISA Plan with respect to which the Owner
Participant (or any Affiliate thereof) is a "plan sponsor" within the
meaning of Section 3(16)(B) of ERISA.
Section 9.02. After-Tax Basis. The amount which the Lessee shall be
required to pay with respect to any Expense indemnified against under Section
9.01 shall be an amount sufficient to restore the Indemnitee, on an After-Tax
Basis, to the same position such party would have been in had such Expense not
been incurred. If any Indemnitee actually realizes a permanent Tax benefit by
reason of the payment of such Expense paid or indemnified against by the
Lessee which was not considered in the computation thereof, such Indemnitee
shall promptly pay to the Lessee, but not before the Lessee shall have made
all payments theretofore due such Indemnitee under this Agreement, the
Original Agreements, the Tax Indemnity Agreement and any other Operative
Agreement, an amount equal to the lesser of (x) the sum of such Tax benefit
plus any other permanent Tax benefit actually realized by such Indemnitee as
the result of any payment made by such Indemnitee pursuant to this sentence
and (y) the amount of such payment pursuant to this Section 9.02 by the Lessee
to such Indemnitee plus the amount of any other payments by the Lessee to such
Indemnitee theretofore made pursuant to this Section 9.02 less the amount of
any payments by such Indemnitee to the Lessee theretofore made pursuant to
this Section 9.02 (and the excess, if any, of the amount described in clause
(x) above over the amount described in clause (y) above shall be carried
forward and applied to reduce pro tanto any subsequent obligations of the
Lessee to make payments to such Indemnitee pursuant to this Section 9.02), it
being intended that no Indemnitee should realize a net Tax benefit pursuant to
this Section 9.02 unless the Lessee shall first have been made whole for any
payments by it to such Indemnitee pursuant to this Section 9.02; provided,
however, that notwithstanding the foregoing portions of this sentence, such
Indemnitee shall not be obligated to make any payment to the Lessee pursuant
to this sentence so long as an Event of Default shall have occurred and be
continuing. Any Taxes that are imposed on any Indemnitee as a result of the
disallowance or reduction of such Tax benefit referred to in the next
preceding sentence in a taxable year subsequent to the year of allowance and
utilization by such Indemnitee (including the expiration of any tax credit
carryovers or carrybacks of such Indemnitee that would not otherwise have
expired) shall be indemnifiable pursuant to the provisions of Section 8.01
hereof without regard to Section 8.01(b) hereof.
Section 9.03. Subrogation. Upon the payment in full of any indemnity
pursuant to this Article 9 by the Lessee (but not earlier), the Lessee shall be
subrogated to any right of the Indemnitee, other than with respect to any of
such Indemnitee's insurance policies or in connection with any indemnity claim
the Person indemnified may have against any other Indemnitee in respect of the
matter against which such indemnity has been made.
Section 9.04. Notice and Payment. Each Indemnitee and the Lessee
shall give prompt written notice one to the other of any liability of which
such party has received notice for which the Lessee is, or may be, liable
under this Article 9; provided, however, that failure to give such notice
shall not terminate any of the rights of the Indemnitees under this Article 9,
except (with respect to such Indemnitee) to the extent that the Lessee has
been materially prejudiced by the failure to provide such notice. Unless
otherwise provided in the Operative Agreements, any amount payable to an
Indemnitee pursuant to this Article 9 shall be paid within 30 days after
receipt of a written demand therefor from such Indemnitee accompanied by a
written statement describing in reasonable detail the basis for such indemnity
and the computation of the amount so payable.
Section 9.05. Refunds. If any Indemnitee shall obtain a recovery of
all or any part of any amount which the Lessee shall have paid to such
Indemnitee or for which the Lessee shall have reimbursed such Indemnitee under
this Article 9, and provided there shall not have occurred a Payment Default
or an Event of Default (in which case payment shall not be made to the Lessee
until such Payment Default or Event of Default shall have been cured) such
Indemnitee shall pay to the Lessee the amount of any such recovery, including
interest received with respect to the recovery, net of any Taxes paid or
payable as a result of the receipt of the recovery and interest, plus any net
additional permanent income tax benefits actually realized by Indemnitee as
the result of any payment made pursuant to this sentence less any reasonable
costs and expense of any Indemnitee not reimbursed by the Lessee; provided,
however, that such amount shall not be payable (a) before such time as the
Lessee shall have made all payments or indemnities then due and payable to
such Indemnitee under this Article 9 or (b) to the extent that the amount of
such payment would exceed the amount of all prior payments by the Lessee to
such Indemnitee pursuant to this Article 9, less the amount of all prior
payments by such Indemnitee to the Lessee pursuant to this Article 9. Any
subsequent loss of such recovery or tax benefit shall be subject to
indemnification under Article 8 or this Article 9, as the case may be, but
without regard to Section 8.01(b) hereof, other than Section 8.01(b)(v) hereof.
Section 9.06. Defense of Claims. The Lessee or its insurers shall
have the right (in each such case at the Lessee's sole expense) to investigate
or, provided that (i) the Lessee or its insurers shall not reserve the right
to dispute liability with respect to any insurance policies pursuant to which
coverage is sought, (ii) in the case of the Lessee, no Payment Default or
Event of Default shall have occurred and be continuing or shall arise at any
time during the claim and (iii) the Lessee shall have first acknowledged in
writing to such Indemnitee the Lessee's obligation to indemnify such
Indemnitee hereunder in respect of such claim, defend any such claim covered by
insurance for which indemnification is sought pursuant to this Article 9 and
each Indemnitee shall cooperate with the Lessee or its insurers with respect
thereto, and provided, further, the Lessee shall not be entitled to assume and
control the defense of any such claim if and to the extent (A) such Indemnitee
reasonably objects to such control on the ground that an actual or potential
material conflict of interest exists where it is advisable for such Indemnitee
to be represented by separate counsel or on the grounds that such proceeding
involves the potential imposition of criminal liability on such Indemnitee or
(B) such proceeding will involve any material danger of the sale, forfeiture
or loss of, or the creation of any Lien on the Aircraft or the Trust Estate
(unless the Lessee posts a bond or other security reasonably acceptable in
form and substance to such Indemnitee) or involve any material risk of civil
liability to such Indemnitee for which it is not indemnified hereunder.
Subject to the immediately foregoing sentence, where the Lessee or the
insurers under a policy of insurance maintained by the Lessee undertake the
defense of an Indemnitee with respect to such a claim, no additional legal
fees or expenses of such Indemnitee in connection with the defense of such
claim shall be indemnified hereunder unless the fees or expenses were incurred
at the written request of the Lessee or such insurers. Subject to the
requirement of any policy of insurance applicable to a claim, an Indemnitee
may participate at its own expense at any judicial proceeding controlled by
the Lessee or its insurers pursuant to the preceding provisions, to the extent
that such party's participation does not, in the opinion of the independent
counsel appointed by the Lessee or its insurers to conduct such proceedings,
interfere with such control; and such participation shall not constitute a
waiver of the indemnification provided in this Section 9.06. No Indemnitee
shall enter into any settlement or other compromise with respect to any claim
described in this Section 9.06 without the prior written consent of the
Lessee, which consent shall not unreasonably be withheld or delayed, unless
such Indemnitee waives its right to be indemnified under this Article 9 with
respect to such claim. The Lessee shall not enter into any settlement or
compromise which the Lessee has not agreed to discharge or with respect to
which the Lessee has not agreed to indemnify such Indemnitee to such
Indemnitee's satisfaction or which admits any criminal violation, gross
negligence or willful misconduct on the part of any Indemnitee without the
prior written consent of such Indemnitee.
Section 9.07. Survival of Obligations. The representations,
warranties, indemnities and agreements of the Lessee provided for in this
Article 9 and the Lessee's obligations under any and all of them shall survive
the expiration or other termination of this Agreement, the Tax Indemnity
Agreement, the Trust Agreement, the Indenture, the Purchase Agreement
Assignment, the Engine Warranty Assignment, the Lease and the other Operative
Agreements but, as to such indemnities after the expiration or other
termination of the Lease, only with respect to losses, liabilities,
obligations, damages, penalties, claims, actions, suits, costs, Expenses and
disbursements caused by events occurring or existing (or fairly attributable
to the Lessee's acts or omissions) prior to such termination or expiration or
incurred in the process of (i) the return or disposition of the Aircraft under
Article 12 or Article 17 of the Lease, or (ii) the termination of the Lease or
the Indenture or, if later, the return of the Aircraft.
Section 9.08. Effect of Other Indemnities. The Lessee's obligations
under the indemnities provided for in this Agreement shall be those of a
primary obligor whether or not the Person indemnified shall also be
indemnified with respect to the same matter under the terms of this Agreement,
the Lease, the Indenture, the Trust Agreement, or any other document or
instrument, and the Person seeking indemnification from the Lessee pursuant to
any provision of this Agreement may proceed directly against the Lessee
without first seeking to enforce any other right of indemnification.
Section 9.09. Interest. The Lessee will pay to each Indemnitee on
demand, to the extent permitted by applicable law, interest on any amount of
indemnity not paid when due pursuant to this Article 9 until the same shall be
paid, at the Past Due Rate.
Section 9.10. Obligations of Lessee Unsecured. The obligations of
the Lessee to the Original Loan Participants under this Article 9 shall
constitute unsecured obligations of the Lessee to such Original Loan
Participants and are not secured by the Lien of the Indenture or the Original
Indenture.
ARTICLE 10
TRANSACTION COSTS
Section 10.01. Transaction Costs and Other Costs. (a) Transaction
Costs. The Owner Participant shall pay (or reimburse the Lessee if the Lessee
shall have previously made such payment), in addition to those items set forth
in Section 10.01(a) of the Original Participation Agreement all fees and
expenses of the following persons relating to the public offering of the Pass
Through Certificates contemplated by the Underwriting Agreement and related to
the transactions contemplated hereby: (i) the fees and expenses of counsel for
the Owner Participant; (ii) the fees and expenses of the transaction
documentation counsel and counsel for the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee, the Original Loan Participants and the
Underwriters (other than those fees, expenses and disbursements payable by the
Underwriters pursuant to the Underwriting Agreement); (iii) the fees and
expenses of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇; (iv) any initial fees and expenses
of the Pass Through Trustee and the fees and expenses of the Owner Trustee and
the Indenture Trustee; (v) any compensation, commissions and discounts payable
to the Underwriters pursuant to the Underwriting Agreement; (vi) the fees, if
any, incurred in printing the Pass Through Certificates; (vii) the fees and
expenses incurred in connection with printing any amendment to the
Registration Statement on Form S-3 bearing Registration No. 333-07691,
printing any Preliminary Prospectus or Prospectus (as such terms are defined
in the Underwriting Agreement) for the offering of the Pass Through
Certificates; (viii) the fees and expenses of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP; (ix) the
fees and expenses of ▇▇▇▇▇'▇ and S&P; (x) the fees and expenses of First
Chicago Leasing Corporation; (xi) the reasonable out-of-pocket expenses of the
Owner Participant; and (xii) reimbursement to the Owner Participant, the Owner
Trustee, the Indenture Trustee and the Pass Through Trustee for any and all
fees, expenses and disbursements incurred in connection with the negotiation,
preparation, execution and delivery, filing and recording of the Operative
Agreements and the documents contemplated thereby, including, without
limitation, travel expenses and disbursements which shall have been paid by
such party. The fees and expenses described in clauses (ii) through (xii) of
this paragraph shall be allocable to the Owner Participant under this
Agreement (1) to the extent incurred specifically with respect to the Owner
Participant or the refunding of the Original Loan Certificates, and (2) to the
extent such fees and expenses are incurred but are not specifically
attributable to the Owner Participant or the refunding of the Original Loan
Certificates, in the proportion that the principal amount of the Certificates
bears to the total amount of the Pass Through Certificates.
The Owner Participant, the Owner Trustee and the Lessee acknowledge
that the percentages for Basic Rent, Stipulated Loss Value and Termination
Value set forth in the Lease have been prepared assuming the aggregate amount
payable by the Owner Participant pursuant to the preceding paragraph and
Section 10.01 of the Original Participation Agreement is 1.33% of the Purchase
Price (the "Estimated Expense Amount").
(b) Continuing Expenses. The continuing fees, expenses and
disbursements (including reasonable counsel fees and expenses) of the entity
acting as Owner Trustee, as lessor under the Lease and as Owner Trustee under
the Trust Agreement with respect to the administration of the Lease and the
Lessor's Estate and the continuing fees, expenses and disbursements (including
reasonable counsel fees and expenses and initial fees relating to the
establishment of any replacement trustee) of the Indenture Trustee, as trustee
under the Indenture with respect to the administration of the Trust Indenture
Estate and the continuing fees, expenses and disbursements (including
reasonable counsel fees and initial fees relating to the establishment of a
replacement trustee) of the Pass Through Trustee shall be paid as Supplemental
Rent by the Lessee, including without limitation any amounts payable to the
Indenture Trustee or on account of requests by the Indenture Trustee for
indemnification under Article XI of the Indenture.
(c) Amendments, Supplements and Appraisal. Without limitation of the
foregoing, the Lessee agrees:
(i) to pay as Supplemental Rent to the Owner Trustee, the Owner
Participant, the Indenture Trustee and the Pass Through Trustee all costs
and expenses (including reasonable legal fees and expenses) incurred by any
of them in connection with (a) any Default or Event of Default and any
enforcement or collection proceedings resulting therefrom, or (b) the
enforcement of the obligations of the Lessee hereunder or under the other
Operative Agreements, including, without limitation, the entering into or
giving or withholding of any amendments or supplements or waivers or
consents (whether or not consummated), including without limitation, any
amendment, supplement, waiver or consent resulting from any work-out,
restructuring or similar proceeding relating to the performance or
nonperformance by the Lessee of its obligations under the Operative
Agreements or (c) any amendment, supplement, waiver or consent (whether or
not entered into) under the Original Agreements, this Agreement, the Lease,
the Indenture, the Certificates, the Tax Indemnity Agreement, the Purchase
Agreement Assignment or any other Operative Agreement or document or
instrument delivered pursuant to any of them, which amendment, supplement,
waiver or consent is required by any provision of any Operative Agreement
(including any adjustment pursuant to Section 3.04 of the Lease) or is
requested by the Lessee or necessitated by the action or inaction of the
Lessee; provided, however, that the Lessee shall not be responsible for
fees and expenses incurred in connection with the offer, sale or other
transfer (whether pursuant to Section 7.03(d) hereof or otherwise) by the
Owner Participant after the Refunding Date of any interest in the Aircraft,
the Lessor's Estate, the Beneficial Interest or the Trust Agreement or any
similar interest (and the Owner Participant shall be responsible for all
such fees and expenses), unless such offer, sale or transfer shall occur
(A) after the Lease has been declared in default or if the transfer is
pursuant to the exercise of remedies under Article 17 of the Lease or (B)
in connection with the termination of the Lease or action or direction of
the Lessee pursuant to Section 4.02, Article 10 or Article 11 of the Lease;
and
(ii)to pay the fees, costs and expenses of all appraisers involved in
an independent appraisal of the Aircraft to the extent required under
Section 4.03 of the Lease.
ARTICLE 11
SUCCESSOR OWNER TRUSTEE
Section 11.01. Appointment of Successor Owner Trustee. (a)
Resignation and Removal. The Owner Trustee or any successor Owner Trustee may
resign or may be removed by the Owner Participant, and a successor Owner
Trustee may be appointed and a Person may become Owner Trustee under the Trust
Agreement only in accordance with the provisions of Section 3.11 of the Trust
Agreement and the provisions of paragraphs (b) and (c) of this Section 11.01.
(b) Conditions to Appointment. The appointment in any manner of a
successor Owner Trustee pursuant to Section 3.11 of the Trust Agreement shall
be subject to the following conditions:
(i) Such successor Owner Trustee shall be a Citizen of the United
States;
(ii)Such successor Owner Trustee shall be a bank or a trust company
having combined capital, surplus and undivided profits of at least
$100,000,000 or a bank or trust company fully guaranteed by a direct or
indirect parent thereof having a combined capital, surplus and undivided
profits of at least $100,000,000;
(iii) Such appointment shall not violate any provisions of the
Transportation Code or any applicable rule or regulation of the applicable
regulatory agency or body of any other jurisdiction in which the Aircraft
may then be registered or create a relationship which would be in violation
of the Transportation Code or any applicable rule or regulation of the
applicable regulatory agency or body of any other jurisdiction in which the
Aircraft may then be registered;
(iv) Such successor Owner Trustee shall enter into an agreement or
agreements, in form and substance reasonably satisfactory to the Lessee, the
Owner Participant, the Pass Through Trustee and the Indenture Trustee
whereby such successor Owner Trustee confirms that it shall be deemed a
party to this Agreement, the Trust Agreement, the Lease, the Lease
Supplement, the Purchase Agreement Assignment, the Engine Warranty
Assignment, the Indenture, the Indenture Supplement and any other Operative
Agreement to which the Owner Trustee is a party and agrees to be bound by
all the terms of such documents applicable to the Owner Trustee and makes
the representations and warranties contained in Section 7.04 hereof (except
that it may be duly incorporated, validly existing and in good standing
under the laws of the United States of America or any State thereof); and
(v) All filings of Uniform Commercial Code financing and continuation
statements, filings in accordance with the Transportation Code and
amendments thereto shall be made and all further actions taken in
connection with such appointment as may be necessary in connection with
maintaining the validity, perfection and priority of the Lien of the
Indenture and the valid and continued registration of the Aircraft in
accordance with the Transportation Code.
(c) Appointment. For so long as the Aircraft remains registered
under the Transportation Code, the Owner Participant agrees to appoint
promptly a successor Owner Trustee meeting the requirements of Section
11.01(b) hereof in the event the Owner Participant has knowledge that the
Owner Trustee at any time shall not be a Citizen of the United States.
ARTICLE 12
LIABILITIES AND INTERESTS OF THE OWNER PARTICIPANT AND HOLDERS
Section 12.01. Liabilities of the Owner Participant. The Owner
Participant shall have no obligation or duty to the Lessee or to any Holder
with respect to the transactions contemplated by this Agreement, except those
obligations or duties expressly set forth in this Agreement, the Indenture,
the Trust Agreement, the Tax Indemnity Agreement, AVSA's FAA ▇▇▇▇ of Sale,
AVSA's Warranty ▇▇▇▇ of Sale, the Lease or any other Operative Agreement to
which the Owner Participant is a party and the Owner Participant shall not be
liable for the performance by any party hereto of such other party's
obligations or duties hereunder. Under no circumstances shall the Owner
Participant as such be liable to the Lessee, nor shall the Owner Participant be
liable to any Holder, for any action or inaction on the part of the Owner
Trustee or the Indenture Trustee in connection with this Agreement, the
Indenture, the Lease, the Trust Agreement, the Purchase Agreement Assignment,
the Engine Warranty Assignment, any other Operative Agreement, any Original
Agreement, the ownership of the Aircraft, the administration of the Lessor's
Estate or the Trust Indenture Estate or otherwise, whether or not such action
or inaction is caused by the willful misconduct or gross negligence of the
Owner Trustee or the Indenture Trustee.
Section 12.02. Interest of Holders of Certificates. A Holder of a
Certificate shall have no further interest in, or other right with respect to,
the Trust Indenture Estate when and if the principal and interest on all
Certificates held by such Holder and all other sums payable to such Holder
under this Agreement, under the Indenture and under such Certificates shall
have been paid in full.
ARTICLE 13
OTHER DOCUMENTS
Section 13.01. Consent of Lessee to Other Documents. The Lessee
hereby consents in all respects to the execution and delivery of the Trust
Agreement and the Indenture and to all of the terms of said documents, and the
Lessee acknowledges receipt of an executed counterpart of each of the Trust
Agreement and the Indenture; it being agreed that such consent shall not be
construed to require the Lessee's consent to any future supplement to, or
amendment, waiver or modification of the terms of the Trust Agreement, the
Indenture or the Certificates, except that no section of the Indenture or the
Trust Agreement shall be amended or modified in any manner which materially
adversely affects the Lessee without its consent.
Section 13.02. Further Assurances. The Lessee hereby confirms to the
Owner Participant its covenants set forth in and obligations under the Lease.
The Lessee agrees that, except as otherwise provided in the Indenture, the
Owner Trustee may not enter into any amendment, modification or supplement of,
or give any waiver or consent with respect to, or approve any matter or
document as being satisfactory under the Lease without the prior consent of
the Indenture Trustee and the Owner Participant and that, except as otherwise
provided in the Indenture, upon an Indenture Event of Default, the Indenture
Trustee may act as the Lessor under the Lease to the exclusion of the Owner
Trustee. The Lessee further agrees to deliver to the Indenture Trustee and
the Owner Participant a copy of each notice, statement, request, report or
other communication given or required to be given to the Owner Trustee under
the Lease.
Section 13.03. No Retroactive Application. This Agreement, the
Lease, the Indenture, the Ancillary Agreement I and the Trust Agreement each
amend and restate, and the Tax Indemnity Agreement amends, the respective
original agreements with no intention of retroactive application. The
applicable original agreements have been restated for the convenience of the
parties and such amendments and restatements, and such amendment in the case
of the Tax Indemnity Agreement, are not intended to waive or modify the
obligations of any party which accrued or were to have been performed on or
prior to the Refunding Date under such unamended agreements (or, in the case
of this Agreement, the effective date hereof) or to deprive any party of its
rights and remedies in respect thereof.
Section 13.04. Pass Through Trustee's Acknowledgment. The Pass
Through Trustee hereby acknowledges and agrees to be bound by all of the terms
and conditions of the Indenture, including without limitation, Section 8.01
thereof regarding the rights of the Owner Participant to purchase the
Certificates under circumstances specified therein.
ARTICLE 14
NOTICES
Section 14.01. Notices. All notices, demands, declarations and other
communications required by this Agreement shall be in writing and shall be
deemed received (a) if given by telecopier, when transmitted and the
appropriate telephonic confirmation received if transmitted on a Business Day
and during normal business hours of the recipient, and otherwise on the next
Business Day following transmission, (b) if given by certified mail, return
receipt requested, postage prepaid five Business Days after being deposited in
the United States mail and (c) if given by FedEx service (or, if a Default or
Event of Default shall have occurred and be continuing, by other comparable
courier service), when received or personally delivered, addressed:
(a) If to the Lessee, to its office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice President and Treasurer with a
copy to Senior Vice President and General Counsel at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (901)
395-4758; or to such other address as the Lessee shall from time to time
designate in writing to the Lessor, the Indenture Trustee and the Owner
Participant;
(b) If to the Lessor or the Owner Trustee, to its office at ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Department, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇; or to such
other address as the Lessor shall from time to time designate in writing to
the Lessee and the Indenture Trustee, with a copy to the Owner Participant;
(c) If to the Owner Participant, to its office at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Vice President Leasing
with a copy to Director, Portfolio Administration, telephone (914)
▇▇▇-▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇, or to such other address as the Owner
Participant may from time to time designate in writing to the Lessee and
the Indenture Trustee; and
(d) If to the Indenture Trustee or the Pass Through Trustee, to its
office at Two ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile
(▇▇▇) ▇▇▇-▇▇▇▇; or to such other address as the Indenture Trustee or the
Pass Through Trustee, as the case may be, shall from time to time designate
in writing to the Lessor, the Lessee and the Owner Participant.
ARTICLE 15
REFINANCING/REOPTIMIZATION
Section 15.01. Refinancing. (a) Subject to the terms and
conditions of this Section 15.01, the Lessee may request the Owner Participant
to participate in up to three refinancings (including the refinancing
contemplated by this Agreement on the Refunding Date) in whole but not in
part, of the Certificates prior to the end of the Basic Term (a
"Refinancing"). Such Refinancings may be placed in either the private or
public markets and shall be denominated in United States dollars (or in any
other foreign currency so long as the Owner Participant is satisfied there is
no foreign currency risk to it), and shall be on terms that do not materially
adversely affect the Owner Participant. The Owner Participant agrees to
negotiate promptly in good faith to conclude an agreement with the Lessee as
to the terms of any such Refinancing transaction (including the terms of any
debt to be issued in connection with such refinancing and the documentation to
be executed in connection therewith). Without the prior written consent of
the Owner Participant, the prospectus and other offering materials relating to
any Refinancing in the form of a public offering shall not identify the Owner
Participant and shall not include any financial statements of the Owner
Participant or any Affiliate thereof. In connection with any such Refinancing
in the form of a public offering, the Lessee shall indemnify the Owner
Participant in a manner satisfactory to it for any liabilities under federal,
state or foreign securities laws resulting from such offering. The aggregate
principal amount of the new Certificates issued in connection with each
Refinancing shall be the same as the aggregate principal amount outstanding on
the Certificates being refinanced.
(b) Notwithstanding anything herein to the contrary, no Refinancing
will be permitted unless the Owner Participant and the Indenture Trustee shall
have received at least 15 days prior written notice (three (3) Business Days
with respect to the refinancing contemplated by this Agreement on the
Refunding Date) of the scheduled closing date of such Refinancing and the
Owner Participant shall have been provided such longer period as it shall have
required for a reasonable opportunity to review the relevant documentation and
the Owner Participant shall have determined in good faith that neither it nor
the Owner Trustee shall suffer any loss or expense or bear any increased risk
as a result of such Refinancing (including, without limitation, any risk with
respect to taxes or other adverse consequences to the Owner Participant
including the application of Revenue Procedures 75-21 and 75-28 and Section
467 of the Code) for which it has not been or will not have been indemnified
by the Lessee in a manner reasonably satisfactory to the Owner Participant,
nor shall its rights against all other parties taken as a whole be adversely
affected compared to such rights in effect under the Operative Agreements
prior to such proposed Refinancing.
Prior to the consummation of any Refinancing pursuant to this Section
15.01, the Owner Participant and the Lessee shall agree upon a schedule
setting forth each installment of Basic Rent and setting forth Stipulated Loss
Values and Termination Values payable pursuant to the Lease as a result of the
Refinancing in accordance with Section 3.04 of the Lease, and thereafter the
amounts set forth in such schedule shall become the amounts payable under the
Lease. Upon the consummation of the Refinancing, the evidence of indebtedness
issued pursuant to the Refinancing shall be considered "Certificates" for
purposes of this Agreement, the Lease and the Indenture.
(c) Notwithstanding the foregoing, the Owner Participant shall have
no obligation to proceed with any Refinancing transaction as contemplated by
this Section 15.01 unless the Lessee indemnifies the Owner Trustee and the
Owner Participant by agreement in form and substance satisfactory to each of
them, for any liability, obligation (other than the obligation to pay
principal and interest in respect of the refinanced indebtedness), cost or
expense (including, without limitation, reasonable attorneys' fees and
Make-Whole Premium or other amounts due under the Indenture), including any
adverse tax consequences or impact, related to or arising out of any such
Refinancing transaction.
(d) Without the prior written consent of the Owner Participant, which
consent may be withheld in its sole discretion, no such refinancing shall (1)
cause the aggregate principal amount of the indebtedness to be substituted for
the Loan Certificates to exceed the aggregate principal amount of the then
outstanding Loan Certificates, (2) cause the weighted average life of such
indebtedness to be different by more than 6 months than the remaining weighted
average life of the then outstanding Loan Certificates, or (3) cause the date
of maturity of such indebtedness to be later than the date of maturity of the
Loan Certificates being refinanced.
(e) Each party agrees to take or cause to be taken all requested
action, including, without limitation, the execution and delivery of any
documents and instruments, including, without limitation, amendments or
supplements to the Lease, which may be reasonably necessary or desirable to
effect such Refinancing, including, in the case of the Owner Participant,
direction to the Owner Trustee by the Owner Participant to prepay the
Certificates then outstanding; provided, however, that such Refinancing shall
be subject to the satisfaction of each of the following conditions:
(i) Payment of principal, accrued interest, Make-Whole Premium and
Breakage Costs, if any, and all other sums due and owing on the Certificates
payable under the Indenture;
(ii)Payment in full of all other amounts then due and owing by the
Lessee under this Agreement, the Indenture, the Lease, the Trust Agreement,
and the Certificates then outstanding shall have been made by the Lessee;
(iii) Such party shall have received such opinions of counsel
(including, without limitation, an opinion received by the Owner
Participant from independent tax counsel reasonably satisfactory to the
Lessee that such Refinancing shall not result in any adverse tax
consequences to such Owner Participant, unless the Lessee shall have agreed
to provide an indemnity in respect thereof reasonably satisfactory in form
and substance to the Owner Participant), certificates and other documents
as it may reasonably request, each in form and substance reasonably
satisfactory to such party;
(iv) All authorizations, approvals and consents which in the
reasonable judgment of the Owner Participant are necessary for such
Refinancing shall have been obtained;
(v) The Lessee shall have provided or agreed to provide to the Owner
Participant, as Supplemental Rent under the Lease, sufficient funds to pay
any Breakage Costs, Make-Whole Premium and any other amounts due under the
Indenture;
(vi) The satisfaction or waiver by each other party to this
Agreement of the conditions set forth in this Section 15.01 to such party's
obligations under this Section 15.01;
(vii) No Payment Default, Bankruptcy Default or Event of Default
shall have occurred and be continuing or would occur immediately after
giving effect to such Refinancing;
(viii) In the event the Lessee shall not prohibit the purchase of
the Refinancing loan certificates by, or with the assets of, an employee
benefit plan, as defined in Section 3(3) of ERISA, which is subject to
Title I of ERISA or a plan or individual retirement account, which is
subject to Section 4975(c) of the Code, (individually or collectively, an
"ERISA Plan"), the Lessee will permit the placement of the Refinancing loan
certificates with an ERISA Plan only if either (A) if such placement is in
the form of pass through certificates, the sole underwriter or the manager
or co-manager of the underwriting syndicate or the selling or placement
agent of the Refinancing loan certificates represents to the Lessee that it
has a prohibited transaction exemption from the U.S. Department of Labor
with respect to pass through certificates (such as Prohibited Transaction
Exemption 89-88 or any other comparable exemption) or (B) purchasers of the
Refinancing loan certificates provide a representation (which may be in the
form of a deemed representation) regarding their source of funds used in
acquiring the Refinancing loan certificates and, if such purchasers
represent that they are using funds of an ERISA Plan in acquiring the
Refinancing loan certificates, such purchasers further represent that (1)
either they are relying on a prohibited transaction exemption from the U.S.
Department of Labor with respect to their purchase and holding of the
Refinancing loan certificates and they provide representations regarding the
satisfaction of the relevant conditions of such an exemption or (2) their
purchase and holding of the Refinancing loan certificates will not
constitute a non-exempt prohibited transaction under Section 406 of ERISA
or Section 4975 of the Code. The reliance on any such exemption will not
be conditional on the Owner Participant's representation concerning its
party in interest or other status with respect to ERISA Plans. If neither
exemption referred to in clause (A) or (B) of this paragraph (viii) is
valid or applicable in any respect to the purchase and holding of the
Refinancing loan certificates, or if the representation in clause (B) of
this paragraph (viii) that such purchase and holding will not constitute a
non-exempt prohibited transaction is not correct, whichever is applicable,
then the Lessee shall indemnify the Owner Participant pursuant to, and to
the extent provided for, under Sections 8 and 9 hereof for Taxes and
Expenses resulting from any "prohibited transaction", within the meaning of
Section 406 of ERISA or Section 4975(c)(1) of the Code, occurring with
respect to the placement of the Refinancing loan certificates with, or the
holding of the Refinancing loan certificates by, any ERISA Plan with
respect to which the Owner Participant is a party in interest, within the
meaning of Section 3(14) of ERISA, or a disqualified person, within the
meaning of Section 4975 of the Code, provided, however, that if the Lessee
shall fail to obtain either of the representations set forth in clause (A)
or (B) of this paragraph (viii), such indemnity shall not be subject to the
exceptions set forth under Sections 8.01(b)(xii)(A) and (B) and
9.01(b)(ix)(A) and (B) hereof; and
(ix) The Lessee shall pay all costs and expenses (including legal
fees) incurred in connection with any proposed or actually consummated
Refinancing.
Section 15.02. Reoptimization. (a) If a Change in Tax Rate occurs
prior to the end of the Basic Term, then, subject to the terms and conditions
of this Section 15.02 and Section 3.04 of the Lease, the Owner Participant
may, upon 30 days' prior notice to the Lessee, the Indenture Trustee, the
Owner Trustee and the Holders, elect to modify the schedule of payments of
principal of the certificates issued ("Refinancing Certificates") in
connection with any Refinancing effected after the Refunding Date using
private debt (not including debt issued pursuant to an exemption from
registration under the Securities Act relying on Rule 144A promulgated
thereunder but otherwise marketed in a manner substantially similar to
securities registered under the Securities Act, and not including debt issued
in connection with any offering of securities registered under the Securities
Act) due on each remaining Rent Payment Date on or commencing on the Rent
Payment Date next succeeding the date mutually agreed to by the Owner
Participant, the Lessee and the Indenture Trustee on which the Owner
Participant shall make such modification (the "Reoptimization Date"). Promptly
after making such modification, the Owner Participant shall furnish each party
hereto written notice of the amounts so recalculated.
(b) Adjustments to Refinancing Certificates. On the Reoptimization
Date, subject to the satisfaction on or before the Reoptimization Date of the
conditions set forth in Section 15.02(c), the Owner Trustee will issue and
deliver and the Indenture Trustee will authenticate, and each holder of a
Refinancing Certificate will accept delivery of, a new Refinancing Certificate
or Refinancing Certificates (in replacement of each Refinancing Certificate
then held by such holder, which Refinancing Certificates shall be surrendered
to the Indenture Trustee for cancellation) containing such changed principal
installments (expressed as a percentage of the original principal amount of
such Refinancing Certificate) as shall have been recalculated by the Owner
Participant, but in the same principal amount as, and containing terms
identical to, except as otherwise contemplated by Section 15.02(d) hereof, the
Refinancing Certificates originally issued in connection with the Operative
Agreements.
(c) Conditions to the Obligations of the Holders of the Refinancing
Certificates on the Reoptimization Date. The obligation of each holder of a
Refinancing Certificate to accept delivery of a new Refinancing Certificate on
the Reoptimization Date, and to surrender on such Reoptimization Date any
Refinancing Certificate then held by it, is subject to the following
conditions precedent having been satisfied on or before the Reoptimization
Date:
(i) the requirements of Section 15.02(d) hereof shall have been
satisfied;
(ii)the following documents, in form and substance satisfactory to
such Holder, shall have been duly authorized, executed and delivered by the
party or parties thereto and shall be in full force and effect: (A) if the
payments of Basic Rent, Stipulated Loss Values and Termination Values with
respect to the Term have been changed, an amendment to the Lease, dated the
Reoptimization Date, (B) an amendment to the Indenture setting forth any
changed repayment schedule to the Refinancing Certificates, dated the
Reoptimization Date and duly filed (or in the process of being so duly
filed) for recordation with the Aeronautics Authority and (C) replacement
Refinancing Certificates; and
(iii)in connection with any Reoptimization the Owner Participant
shall pay or agree to pay all reasonable costs and expenses incurred by the
Lessee, the Owner Trustee, the Indenture Trustee and each Holder of a
Refinancing Certificate (including, without limitation, reasonable legal
fees and expenses) in connection with any such reoptimization.
(d) Payment Schedules. Except as otherwise provided in this Section
15.02 as long as the Refinancing Certificates remain outstanding, the payment
schedules for the Refinancing Certificates shall not be modified.
ARTICLE 16
[INTENTIONALLY LEFT BLANK]
ARTICLE 17
MISCELLANEOUS
Section 17.01. Owner for Federal Tax Purposes. It is hereby agreed
between the Owner Participant and the Lessee (but the Lessee makes no
representation to such effect) that it is the intent of the parties for
Federal, state, local and foreign income tax purposes that the Owner
Participant will be treated as the owner of the Aircraft and the Lessee will
be treated as the lessee of the Aircraft.
Section 17.02. [Intentionally Left Blank.]
Section 17.03. Counterparts. This Agreement may be executed by the
parties in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
Section 17.04. No Oral Modifications. Neither this Agreement nor
any of its terms may be terminated, amended, supplemented, waived or modified
orally, but only by an instrument in writing signed by the party against which
the enforcement of the termination, amendment, supplement, waiver or
modification is sought. No such written termination, amendment, supplement,
waiver or modification shall be effective unless a signed copy shall have been
delivered to and executed by the Owner Trustee and the Indenture Trustee. A
copy of each such termination, amendment, supplement, waiver or modification
shall also be delivered to each other party to this Agreement other than the
Original Loan Participants.
The consent of the Pass Through Trustee, in its capacity as a party
to this Agreement and not as a Holder, shall not be required to modify, amend
or supplement this Agreement or to give any consent, waiver, authorization or
approval with respect to this Agreement under the circumstances in which the
consent of the Indenture Trustee would not be required for such modification,
amendment, supplement, consent, waiver or approval in accordance with Section
8.01(b) of the Indenture, provided that the Pass Through Trustee shall be
entitled to receive an Opinion of Counsel (as defined in the Pass Through
Agreement) necessary, in its sole discretion, to establish that the Indenture
Trustee's consent would not be required under such circumstances.
Section 17.05. Captions. The table of contents preceding this
Agreement and the headings of the various Articles and Sections of this
Agreement are for convenience of reference only and shall not modify, define,
expand or limit any of the terms or provisions of this Agreement.
Section 17.06. Successors and Assigns. The terms of this Agreement
shall be binding upon, and shall inure to the benefit of, the Lessee and its
successors and permitted assigns, the Owner Participant and its successors and
permitted assigns, including without limitation each Holder of a Certificate,
the Owner Participant and its successors and permitted assigns, the Owner
Trustee and its successors as Owner Trustee (and any additional owner trustee
appointed) under the Trust Agreement, the Indenture Trustee and its successors
as Indenture Trustee (and any additional indenture trustee appointed) under
the Indenture and the Pass Through Trustee and its successors as Pass Through
Trustee (and any additional pass through trustee appointed).
Section 17.07. Concerning the Owner Trustee, Indenture Trustee and
the Pass Through Trustee. Each of FSB and SSB is entering into this Agreement
solely in their respective capacities (except to the extent otherwise
expressly indicated), in the case of FSB, not in its individual capacity but
solely as Owner Trustee under the Trust Agreement, in the case of SSB, not in
its individual capacity but solely as Indenture Trustee under the Indenture
and as Pass Through Trustee under the Pass Through Agreement, and except as
otherwise expressly provided in this Agreement or in the Lease, the Indenture,
the Pass Through Agreement or the Trust Agreement, neither FSB, nor SSB,
shall be personally liable for or on account of its statements,
representations, warranties, covenants or obligations under this Agreement;
provided, however, that each of FSB and SSB accepts the benefits running to it
under this Agreement, and each agrees that (except as otherwise expressly
provided in this Agreement or any other Operative Agreement to which it is a
party) it shall be liable in its individual capacity for (a) its own gross
negligence or willful misconduct (whether in its capacity as trustee or in its
individual capacity), (b) any breach of representations and warranties or any
breach of covenants made in its individual capacity pursuant to or in
connection with this Agreement or the other Operative Agreements to which it is
a party, (c) any breach, in the case of the Owner Trustee, of its covenants
contained in Sections 3.05 and 3.08 of the Indenture, (d) the failure to use
ordinary care in receiving, handling and disbursing funds, (e) in the case of
the Owner Trustee, Lessor's Liens attributable to it in its individual
capacity, (f) in the case of the Indenture Trustee, Indenture Trustee's Liens
and (g) taxes, fees or other charges on, or based on, or measured by, any
fees, commissions or compensation received by it in connection with the
transactions contemplated by the Operative Agreements.
Section 17.08. 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, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 17.09. Public Release of Information. Subject to applicable
legal requirements (including, without limitation, securities laws
requirements, other regulatory requirements and other legally compelled
disclosures), so long as there shall not have occurred an Event of Default or
Indenture Event of Default, each party to this Agreement shall in each
instance obtain the prior written approval of each other party to this
Agreement concerning the exact text and timing of news releases, articles and
other information releases to the public media concerning any Operative
Agreements.
Section 17.10. Certain Limitations on Reorganization. The Indenture
Trustee and the Pass Through Trustee agree that, if (i) the Owner Trustee
becomes or all or any part of the Lessor's Estate or the trust created by the
Trust Agreement becomes the property of, a debtor subject to the
reorganization provisions of the Bankruptcy Code or any other applicable
bankruptcy or insolvency statutes, (ii) pursuant to any such reorganization
provisions, the Owner Participant is held to have recourse liability to the
debtor, the Owner Trustee or the trustee of the debtor directly or indirectly
on account of any amount payable as Make-Whole Premium, principal or interest
on the Certificates, or any other amount payable on any Certificate that is
provided in the Operative Agreements to be nonrecourse to the Owner
Participant and (iii) the Indenture Trustee actually receives any Recourse
Amount which reflects any payment by the Owner Participant on account of (ii)
above, then the Indenture Trustee, as the case may be, shall promptly refund
to the Owner Participant such Recourse Amount. For purposes of this Section
17.10, "Recourse Amount" means the amount by which the portion of such payment
by the Owner Participant on account of clause (ii) above received by the
Indenture Trustee exceeds the amount which would have been received by the
Indenture Trustee if the Owner Participant had not become subject to the
recourse liability referred to in (ii) above. Nothing contained in this
Section shall prevent the Indenture Trustee from enforcing any individual
obligation (and retaining the proceeds thereof) of the Owner Participant under
this Agreement or any other Operative Agreement to the extent herein or
therein provided, for which the Owner Participant has expressly agreed by the
terms of this Agreement to accept individual responsibility.
Section 17.11. GOVERNING LAW. THIS AGREEMENT SHALL IN ALL RESPECTS
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, WITHOUT
GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS AND IS BEING DELIVERED IN NEW
YORK.
Section 17.12. Section 1110 Compliance. The Owner Participant, the
Lessee and the other parties hereto agree that the transactions contemplated
by the Operative Agreements are expressly intended to be, shall be and should
be construed so as to be entitled to the benefits and protection of Section
1110 of the Bankruptcy Code.
ARTICLE 18
CONFIDENTIALITY
Section 18.01. Confidentiality. Each party hereto agrees (on behalf
of itself and each of its Affiliates, agents, directors, officers, employees
and representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature, any non-public information supplied to it pursuant to this
Agreement which is identified by the Person supplying the same as being
confidential at the time the same is delivered to such party, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for any of the parties hereto, (iii) to bank examiners or similar
regulatory authorities, auditors or accountants, (iv) in connection with any
litigation to which any one or more of the parties hereto is a party relating
to the transactions contemplated hereby or by any of the Operative Agreements,
(v) to an Affiliate of the parties hereto, (vi) to any assignee or participant
(or prospective assignee or participant) or other transferee so long as such
assignee or participant (or prospective assignee or participant) or other
transferee first executes and delivers to the respective party making such
assignment or participation an agreement in writing to be bound by the
provisions of this Section 18.01 or (vii) in the case of the Owner Participant
or the Owner Trustee (in its individual or trust capacity) to the Owner
Trustee (in its individual or trust capacity) or to the Owner Participant, as
the case may be.
IN WITNESS WHEREOF, the parties have caused this Participation
Agreement to be executed by their respective, duly authorized officers and this
Participation Agreement shall be effective this 17th day of October, 1996.
LESSEE:
FEDERAL EXPRESS CORPORATION
By:__________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Treasurer and Managing
Director - Structured Finance
OWNER PARTICIPANT:
PMCC LEASING CORPORATION
By:__________________________________________
Name:
Title:
OWNER TRUSTEE:
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual
capacity except as otherwise
expressly provided herein,
but solely as Owner Trustee
By:__________________________________________
Name:
Title:
INDENTURE TRUSTEE:
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Indenture Trustee
By:__________________________________________
Name:
Title:
PASS THROUGH TRUSTEE:
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Pass Through Trustee
By:__________________________________________
Name:
Title:
ORIGINAL LOAN PARTICIPANTS:
▇▇▇▇▇▇ GUARANTY TRUST COMPANY
OF NEW YORK,
as Agent and as an Original Loan Participant
By:__________________________________________
Name:
Title:
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By:__________________________________________
Name:
Title:
THE CHASE MANHATTAN BANK
By:__________________________________________
Name:
Title:
COMMERZBANK AG, ATLANTA AGENCY
By:__________________________________________
Name:
Title:
NATIONSBANK, N.A. (SOUTH)
By:__________________________________________
Name:
Title:
SCHEDULE I
CERTIFICATE INFORMATION
1. Federal Express Corporation Pass Through Trust, 1996-B1
Federal Express Corporation Trust No. N662FE
Interest Rate: 7.39%
Maturity: January 30, 2012
Principal Amount: $43,271,000.00
2. Federal Express Corporation Pass Through Trust, 1996-B2
Federal Express Corporation Trust No. N662FE
Interest Rate: 7.84%
Maturity: January 30, 2018
Principal Amount: $18,300,000.00
SCHEDULE II
DEFINITIONS
GENERAL PROVISIONS
The following terms shall have the following meanings for all
purposes of the Operative Agreements (other than the Pass Through Agreement
and the Series Supplements) referred to below, unless otherwise defined in an
Operative Agreement or the context thereof shall otherwise require. In the
case of any conflict between the provisions of this Schedule and the
provisions of any Operative Agreement, the provisions of such Operative
Agreement shall control the construction of such Operative Agreement.
Unless the context otherwise requires and except in the case of the
Original Agreements, (i) references to agreements shall be deemed to mean and
include such agreements as amended and supplemented from time to time, and
(ii) references to parties to agreements shall be deemed to include the
successors and permitted assigns of such parties.
DEFINED TERMS:
Additional Insured. As defined in Article 13 of the Lease.
Aeronautics Authority. As appropriate, the Federal Aviation
Administration and/or the Administrator of the Federal Aviation
Administration, any successor to the former United States Civil Aeronautics
Board, or any Person, governmental department, bureau, commission or agency
located in the United States succeeding to the functions of any of the
foregoing.
Affiliate. 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" (including "controlled
by" and "under common control with") shall mean 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. In no event shall the Owner Trustee or the Lessor be deemed an
Affiliate of the Owner Participant.
After-Tax Basis. A basis such that any payment to be received by a
Person shall be supplemented by a further payment to such Person so that the
sum of the two payments, after deduction of all Taxes resulting from the
receipt or accrual of such payments, shall be equal to the payment to be
received. In the case of amounts payable to the Lessor, the Owner Participant,
or any corporate Affiliate of the Owner Participant, it shall be presumed that
such Person is at all times subject to Federal income tax at the maximum
marginal rate generally applicable to corporations from time to time and
actual state, local and foreign income taxes.
Agent. ▇▇▇▇▇▇ Guaranty Trust Company of New York and its
successors and permitted assigns as Agent for the Original Loan Participants
pursuant to Article 16 of the Original Participation Agreement.
Air Carrier. Any U.S. Air Carrier and any "foreign air carrier"
(as defined in the Transportation Code) as to which there is in force a permit
granted under Section 41302 of the Transportation Code.
Airbus Guaranty. The Guaranty dated the Delivery Date executed by
the Manufacturer and guaranteeing AVSA's Warranty ▇▇▇▇ of Sale.
Aircraft. The Airframe (or any permitted substitute airframe
thereunder) together with two Engines (whether either is an initial Engine or
a Replacement Engine) whether or not any of such initial or Replacement
Engines may from time to time be installed on such Airframe or may be
installed on any other airframe or on any other aircraft, including any
aircraft substituted pursuant to Section 11.03 of the Lease.
Airframe. The Airbus A300F4-605R aircraft (excluding the Engines
or engines from time to time installed thereon) leased by the Lessor to the
Lessee pursuant to the Lease and the initial Lease Supplement and having the
United States FAA Registration Number initially and manufacturer's serial
number specified in the initial Lease Supplement, including (i) all Parts in
respect thereof and (ii) any replacement airframe which may be substituted
pursuant to Section 11.03 of the Lease.
Amendment No. 1 to the Original Tax Indemnity Agreement. Amendment
No. 1 to the Original Tax Indemnity Agreement (Federal Express Corporation
Trust No. N662FE), dated as of October 15, 1996.
Ancillary Agreement. Any written agreement of the Lessee to which
the Lessor is a party or to which the Lessor has consented in writing entered
into on the Delivery Date or the Refunding Date or any date thereafter in
connection with the transactions contemplated by the Operative Agreements, as
such agreement may be amended and supplemented from time to time with the
consent of the Lessor and delivered to the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Owner Participant.
Ancillary Agreement I. The Ancillary Agreement I (Federal Express
Corporation Trust No. N662FE), dated the Delivery Date, as amended and
restated as of the Refunding Date, among the Lessee, the Owner Trustee, not in
its individual capacity, but solely as Owner Trustee, the Owner Participant
and the Indenture Trustee not in its individual capacity, but solely as
Indenture Trustee, as originally executed or as amended, modified or
supplemented with the consent of all the parties thereto.
Ancillary Agreement II. The Ancillary Agreement II (Federal
Express Corporation Trust No. N662FE), dated the Refunding Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as Owner
Trustee, the Owner Participant and the Indenture Trustee not in its individual
capacity, but solely as Indenture Trustee, as originally executed or as
amended, modified or supplemented with the consent of all the parties thereto.
Appraisal. The report prepared by BK Associates, Inc. and
delivered to the Owner Participant (with an abbreviated report to the Lessee)
on the Delivery Date pursuant to Section 4.01(n) of the Original Participation
Agreement.
Assignment and Assumption Agreement. Any agreement delivered in
compliance with Section 7.03(d) of the Participation Agreement.
AVSA. AVSA S.A.R.L., a societe a responsabilite limitee,
organized and existing under the laws of France, and its successors and
assigns.
AVSA Consent and Agreement. The Consent and Agreement dated as of
September 1, 1996, executed by AVSA, as the same may be amended, modified or
supplemented from time to time.
AVSA's FAA ▇▇▇▇ of Sale. The ▇▇▇▇ of sale for the Airframe on AC
Form 8050-2, or such other form as may be approved by the Aeronautics
Authority, executed by AVSA in favor of the Owner Trustee and dated the
Delivery Date.
AVSA's Warranty ▇▇▇▇ of Sale. The full warranty ▇▇▇▇ of sale
covering the Aircraft (and specifically referring to each Engine) executed by
AVSA as owner of the Aircraft in favor of the Owner Trustee and dated the
Delivery Date.
Bankruptcy Code. The Federal Bankruptcy Code of 1978, as amended,
and any successor thereto.
Bankruptcy Default. An event specified in Section 16.01(e), (f)
or (g) of the Lease which either does or, with the giving of notice or lapse
of time or both, would constitute an Event of Default.
Basic Rent. The aggregate periodic rent payable for the Aircraft
throughout the Basic Term pursuant to Section 3.02 of the Lease, adjusted
pursuant to Article 3 of the Lease.
Basic Term. The period commencing at the beginning of the day on
the Commencement Date and ending at the end of the day on December 23, 2019, or
such earlier date on which the Lease shall be terminated as provided therein.
Beneficial Interest. The interest of the Owner Participant under
the Trust Agreement.
Breakage Costs. Has the meaning specified in Schedule II to the
Original Participation Agreement.
Business Day. Any day on which commercial banks are not
authorized or required to close in New York, New York, Memphis, Tennessee and
the city in which the office or agency in the United States is maintained by
the Pass Through Trustee for the payment of the Pass Through Certificates, and
after the Lien of the Indenture is discharged, Salt Lake City, Utah.
Certificates. The Equipment Trust Certificates (Federal Express
Corporation Trust No. N662FE), issued by the Owner Trustee pursuant to the
Indenture and any certificate issued in exchange therefor or replacement
thereof pursuant to the Indenture.
Change in Tax Rate. Any amendment, modification, deletion,
addition, or change to the Code which is enacted into law after the Delivery
Date which changes the highest marginal statutory rate of Federal income tax
applicable to the Owner Participant (other than a change which is in the
nature of a minimum tax).
Citizen of the United States. A citizen of the United States as
defined in Section 40102(a)(15) of the Transportation Code, or any analogous
part of any successor or substituted legislation or regulation at the time in
effect.
Closings. The closing with respect to the acquisition of the Pass
Through Certificates by the Underwriters and the closing with respect to the
refunding of the Original Loan Certificates.
Code. Except as otherwise provided, the Internal Revenue Code of
1986, as amended from time to time.
Commencement Date. January 30, 1997.
Consent and Agreement. The Consent and Agreement dated as of
September 1, 1996 executed by the Manufacturer, as the same may be amended,
modified or supplemented from time to time.
Consent and Guaranty. The Consent and Guaranty of the Manufacturer
attached to the Purchase Agreement.
Corporate Trust Administration. The principal office of the
Indenture Trustee located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Department, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Participant and the Owner Trustee.
Corporate Trust Department. The principal office of the Owner
Trustee located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, or such other office at which the Owner
Trustee's corporate trust business shall be administered which the Owner
Trustee shall have specified by notice in writing to the Lessee, the Owner
Participant and the Indenture Trustee.
CRAF Program. Has the meaning specified in Section 7.01(a)(iv) of
the Lease.
Debt Rate. The weighted average (based on Outstanding principal
amount) rate of interest on the Certificates issued pursuant to the Indenture.
Default. Any event or condition which, with the lapse of time or
the giving of notice, or both, would constitute an Event of Default.
Delivery Date. September 23, 1996.
Engine. Each of the two General Electric CF6-80C2-A5F engines
listed by manufacturer's serial numbers in the initial Lease Supplement and
leased pursuant to the Lease, whether or not from time to time installed on
the Airframe or installed on any other airframe or on any other aircraft, and
any Replacement Engine which may from time to time be substituted for an
Engine pursuant to Section 7.02(a)(vii), 10.02(c), 10.03, 11.03, 11.04 or
12.02 of the Lease, together with all Parts related thereto. Except as
otherwise provided, at such time as a Replacement Engine shall be so
substituted and the Engine for which the substitution is made shall be
released from the Lien of the Indenture, such replaced Engine shall cease to
be an "Engine" under the Lease. The term "Engines" means, as of any date of
determination, both Engines then leased to the Lessee pursuant to the Lease.
Engine Consent. The Engine Consent dated as of September 1, 1996,
executed by the Engine Manufacturer, as the same may be amended, modified or
supplemented from time to time.
Engine Manufacturer. General Electric Company, a New York
corporation.
Engine Warranty Assignment. The Engine Warranty Assignment
(Federal Express Corporation Trust No. N662FE), dated as of September 1, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan. An employee benefit plan subject to Title I of ERISA,
or an individual retirement account or plan subject to Section 4975 of the
Code.
Estimated Expense Amount. Has the meaning specified in Section
10.01(a) of the Participation Agreement.
Event of Default. Each of the events specified in Article 16 of
the Lease.
Event of Loss. Any of the following events with respect to the
Aircraft, the Airframe or any Engine: (i) loss of such property or its use (A)
for a period in excess of 60 days due to theft or disappearance or such longer
period, not to exceed 180 days from the end of such initial 60-day period, if
and so long as the location of such property is known to the Lessee and the
Lessee is diligently pursuing recovery of such property, or to the end of the
Term, if less (unless such theft or disappearance constitutes an Event of Loss
pursuant to (i)(B) or (ii) hereof) or (B) for a period in excess of 60 days
due to the destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use by Lessee for any reason whatsoever;
(ii) any damage to such property which results in an insurance settlement with
respect to such property on the basis of a total loss, or constructive or
compromised total loss; (iii) (1) condemnation, confiscation or seizure of, or
requisition of title to such property by the Government, any foreign
government or purported government or any agency or instrumentality thereof,
or (2) condemnation, confiscation, or seizure of, or requisition or taking of,
use of such property (A) by a foreign government or instrumentality or agency
of any such foreign government, for a period in excess of 180 days (or such
shorter period ending on the earlier of the expiration of the Term or on the
date on which an insurance settlement with respect to such property on the
basis of a total loss or constructive or compromised total loss shall occur)
or (B) by the Government for a period extending beyond the Term; and (iv) as a
result of any law, rule, regulation, order or other action by the Aeronautics
Authority or other governmental body having jurisdiction, the use of the
Aircraft or Airframe in the normal course of air transportation of cargo shall
have been prohibited by virtue of a condition affecting all Airbus A300-600
series aircraft equipped with engines of the same make and model as the
Engines for a period of twelve (12) consecutive months, unless the Lessee,
prior to the expiration of such twelve (12) month period, shall be diligently
carrying forward all steps which are necessary or desirable to permit the
normal use of the Aircraft or Airframe or, in any event, if such use of the
Aircraft or the Airframe shall have been prohibited for a period of
twenty-four (24) consecutive months or until the end of the Term, if earlier.
The date of such Event of Loss shall be (s) the 61st day or the 241st day, as
the case may be, following loss of such property or its use due to theft or
disappearance (or the end of the Term or the Lessee's abandonment of diligent
efforts to recover such property, if earlier); (t) the 61st day following the
date of any destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use; (u) the date of any insurance
settlement on the basis of a total loss or constructive or compromised total
loss; (v) the date of any condemnation, confiscation, seizure or requisition
of title of such property; (w) the 181st day following condemnation,
confiscation, seizure or requisition for use of such property by a foreign
government referred to in clause (iii)(2)(A) above (or the end of the Term or
the date of any insurance settlement described therein, if earlier than such
181st day); (x) the last day of the Term in the case of requisition for use of
such property by the Government; (y) the last day of the 12 month or 24 month
period, referred to in clause (iv) above (or if earlier, the end of the Term
or abandonment of the Lessee's efforts to restore the normal use of the
Aircraft). An Event of Loss with respect to the Aircraft shall be deemed to
have occurred if any Event of Loss occurs with respect to the Airframe. If an
Event of Loss described in any of clauses (i) (A), (iii) or (iv) above shall
occur, Lessor may elect, within 30 days following the date upon which such
Event of Loss is deemed to have occurred, to waive such Event of Loss and the
consequences thereof.
Excepted Payments. Collectively, (i) indemnity, expense,
reimbursement or other payments paid or payable by the Lessee in respect of
the Owner Participant, the Owner Trustee in its individual capacity or any of
their respective successors, permitted assigns, directors, officers,
employees, servants and agents or Affiliates, pursuant to the Participation
Agreement or any other Operative Agreement or any indemnity hereafter granted
to the Owner Participant or the Owner Trustee in its individual capacity
pursuant to the Lease or the Participation Agreement, (ii) proceeds of public
liability insurance (or government indemnities in lieu thereof) in respect of
the Aircraft payable as a result of insurance claims paid for the benefit of,
or losses suffered by, the Owner Trustee or the Indenture Trustee in their
respective individual capacities or by the Owner Participant, or their
respective successors, permitted assigns or Affiliates, (iii) proceeds of
insurance maintained with respect to the Aircraft by the Owner Participant
(whether directly or through the Owner Trustee) maintained in accordance with
Section 13.05 of the Lease but not required under Article 13 of the Lease,
(iv) payments of Supplemental Rent by the Lessee in respect of any amounts
payable under the Tax Indemnity Agreement, (v) any purchase price paid to the
Owner Participant for its interest in the Trust Estate pursuant to Section
7.03(d) of the Participation Agreement, (vi) subject to Section 3.05 of the
Lease, payments constituting increases in Basic Rent attributable to payments
arising pursuant to Section 5 of the Tax Indemnity Agreement, (vii) any
payments in respect of interest to the extent attributable to payments
referred to in clauses (i) through (vi) above and (viii) any right to demand,
collect or otherwise receive and enforce the payment of any amount described
in clauses (i) through (v) and (vii) above (except with respect to interest
attributable to payments referred to in clause (vi) above).
Expense; Expenses. Have the meaning specified in Section 9.01(a)
of the Participation Agreement.
FPO Price. Has the meaning set forth in Section 4.02(a)(F) of the
Lease.
FSB. First Security Bank, National Association, a national banking
association.
Fair Market Renewal Term. A term with respect to which the Lessee
has exercised its option to renew the Lease pursuant to the second paragraph
of Section 4.01(a) thereof and with respect to which the conditions set forth
in such Section 4.01(a) are met.
Fair Market Rental. An amount determined on the basis of, and
equal in amount to, the rental which would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and willing
lessor unaffiliated with such lessee, neither being under any compulsion to
lease. In such determination, it shall be assumed that the Aircraft is in the
condition required under the Lease in the case of return of the Aircraft
pursuant to Article 12 of the Lease and Fair Market Rental shall be determined
in accordance with the provisions of Section 4.03 of the Lease.
Fair Market Value. An amount determined on the basis of, and
equal in amount to, the value which would be obtained in an arm's-length
transaction between an informed and willing purchaser under no compulsion to
buy and an informed and willing seller unaffiliated with such purchaser and
under no compulsion to sell, assuming the Aircraft (or other property) is
unencumbered by the Lease. In such determination, except for purposes of
Section 17.01 of the Lease (when it shall be determined based upon the actual
condition and location of the Aircraft), it shall be assumed that the Aircraft
is in the condition required under the Lease in the case of return of the
Aircraft pursuant to Article 12 of the Lease and Fair Market Value shall be
determined in accordance with the provisions of Section 4.03 of the Lease.
Federal Aviation Administration; FAA. The United States Federal
Aviation Administration and any successor agency or agencies thereto.
Fixed Renewal Rent. Semi-annual payments of rent during the Fixed
Renewal Term equal to the lesser of (i) Fair Market Rental as determined as of
the commencement of such Fixed Renewal Term and (ii) 50% of the average actual
semi-annual Basic Rent payable during the Basic Term.
Fixed Renewal Term. The term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the first paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth in
such Section 4.01(a) are met.
French Pledge Agreement. The French Pledge Agreement dated as of
September 1, 1996 between the Owner Trustee and the Indenture Trustee.
Government. The United States of America or an agency or
instrumentality thereof the obligations of which bear the full faith and
credit of the United States of America.
GTA. The General Terms Agreement dated as of July 3, 1991 between
the Engine Manufacturer and the Lessee related to the purchase by the Lessee
of the Engines as originally executed or as modified, amended or supplemented
in accordance with the terms thereof, but only insofar as the General Terms
Agreement relates to the Engines, to the extent assigned to the Owner Trustee
pursuant to the Engine Warranty Assignment.
Holder of a Certificate; Certificate Holder; Holder. As of any
particular time, the Person in whose name a Certificate shall be registered
(but not including the holder of any Pass Through Certificate).
Indemnitee. Each of FSB, in its individual capacity and as Owner
Trustee and Lessor, the Agent (to the extent set forth in Articles 8 and 9 of
the Original Participation Agreement), the Owner Participant, the Original
Loan Participants (to the extent set forth in Articles 8 and 9 of the Original
Participation Agreement), the Indenture Trustee, in its individual capacity
and as trustee, any Owner Participant Guarantor, and any successor (including
any trustee which may succeed to the Lessor's interest under the Lease),
Affiliate, assign, officer, director, employee, agent and servant of any of
the foregoing, the Lessor's Estate and the Trust Indenture Estate. Neither
the Certificate Holder nor any holder of a Pass Through Certificate shall be
deemed to be an Indemnitee.
Indenture. The Trust Indenture and Security Agreement (Federal
Express Corporation Trust No. N662FE), dated as of September 1, 1996, as
amended and restated as of October 15, 1996, between the Lessor and the
Indenture Trustee, as supplemented by the Indenture and Security Agreement
Supplement, and as said Indenture may from time to time be further
supplemented or amended, including any amendment or supplement thereto entered
into from time to time pursuant to the applicable provisions of the Indenture.
Indenture and Security Agreement Supplement. The Indenture and
Security Agreement Supplement No. 1 (Federal Express Corporation Trust No.
N662FE) dated September 23, 1996, as such Indenture and Security Agreement
Supplement shall be amended or supplemented from time to time and any other
supplement to the Indenture, substantially in the form of Exhibit A to the
Indenture.
Indenture Default. Any event or condition which, with the lapse
of time or the giving of notice, or both, would constitute an Indenture Event
of Default.
Indenture Documents. Has the meaning specified in the Granting
Clause of the Indenture.
Indenture Event of Default. Each of the events specified in
Section 7.01 of the Indenture.
Indenture Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, not in its individual capacity but solely as
Indenture Trustee under the Indenture and each other Person which may from
time to time be acting as successor trustee under the Indenture.
Indenture Trustee's Liens. Any Lien on the Trust Indenture Estate
resulting from (i) claims against the Indenture Trustee not related to the
administration of the Trust Indenture Estate or any transactions pursuant to
the Indenture or any document included in the Trust Indenture Estate, (ii) any
act or omission of the Indenture Trustee which is not related to the
transactions contemplated by the Operative Agreements or is in violation of
any of the terms of the Operative Agreements or (iii) Taxes imposed against
the Indenture Trustee in its individual capacity in respect of which the
Lessee has not indemnified (and is not obligated to indemnify) the Indenture
Trustee in such capacity.
Independent Appraisal. An appraisal conducted pursuant to Section
4.03 of the Lease.
Independent Investment Banker. An independent investment banking
institution of national standing appointed by the Lessee that is independent
in fact, does not have any direct financial interests, or any material
indirect financial interest, in the Lessee or any Affiliate of the Lessee, and
is not connected with the Lessee or any Affiliate of the Lessee, as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions; provided, that if the Indenture Trustee shall
not have received written notice of such an appointment at least 10 days prior
to the Prepayment Date, "Independent Investment Banker" shall mean such an
institution appointed by the Indenture Trustee.
Interim Term. The period commencing on the Delivery Date and
ending at the end of the day immediately preceding the Commencement Date.
Invoice. The invoice for the Aircraft given by AVSA to the Lessor.
Lease. The Lease Agreement (Federal Express Corporation Trust No.
N662FE) dated as of September 1, 1996, as amended and restated as of October
15, 1996, entered into by the Lessor and the Lessee concurrently with the
execution and delivery of the Indenture, as said Lease may from time to time
be supplemented or amended, or its terms waived or modified, to the extent
permitted by, and in accordance with, the terms of the Indenture, including,
without limitation, supplementation by one or more Lease Supplements entered
into pursuant to the applicable provisions of the Lease.
Lease Supplement. The Lease Supplement No. 1 (Federal Express
Corporation Trust No. N662FE) dated September 23, 1996, as such Lease
Supplement shall be amended or supplemented from time to time and any other
supplement to the Lease, substantially in the form of Exhibit A to the Lease.
Lease Term. The period commencing on the Delivery Date and ending
at the end of the Basic Term.
Lessee. Federal Express Corporation, a Delaware corporation, and
its successors and permitted assigns.
Lessee Documents. Has the meaning set forth in Section 6.01(b) of
the Participation Agreement.
Lessor. First Security Bank, National Association, a national
banking association, not in its individual capacity but solely as Owner
Trustee under the Trust Agreement, and its successors and permitted assigns.
Lessor's Estate. All estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Participation Agreement, AVSA's FAA ▇▇▇▇ of Sale, AVSA's Warranty ▇▇▇▇ of
Sale, the Airbus Guaranty, the Purchase Agreement, the Purchase Agreement
Assignment, the Consent and Agreement, the AVSA Consent and Agreement, the
Consent and Guaranty (to the extent assigned by the Purchase Agreement
Assignment), any Ancillary Agreement, the GTA, the Engine Warranty Assignment,
the Engine Consent, any warranty with respect to the Airframe and the Engines,
all amounts of Basic Rent and Supplemental Rent, including without limitation,
insurance proceeds (other than insurance proceeds payable to or for the
benefit of the Owner Trustee in its individual capacity or the Owner
Participant) and requisition, indemnity or other payments of any kind for or
with respect to the Aircraft (except amounts owing to the Owner Participant,
to the Indenture Trustee, to the Owner Trustee in its individual capacity, or
to any of their respective directors, officers, employees and agents pursuant
to Articles 8 and 9 of the Participation Agreement), and all other property of
the Owner Trustee purportedly subjected to the Lien of the Indenture by the
Granting Clause thereof; provided that in no event shall "Lessor's Estate"
include any Excepted Payment.
Lessor's Liens. Liens on the Lessor's Estate or the Trust
Indenture Estate arising as a result of (i) claims against the Lessor, in its
individual capacity or as Owner Trustee, or the Owner Participant, in each
case not related to the transactions contemplated by the Operative Agreements,
(ii) acts or omissions of the Lessor in its individual capacity or as Owner
Trustee, and, in the case of the Lessor in its individual capacity, arising
from its gross negligence or willful misconduct or expressly prohibited under
the Operative Agreements and any act or omission of the Owner Participant
which is in violation of any of the terms of the Operative Agreements, (iii)
Taxes or Expenses imposed against the Lessor, in its individual capacity or as
Owner Trustee, Owner Participant, Lessor's Estate or the trust created by the
Trust Agreement which are not required to be indemnified against by the Lessee
pursuant to the Participation Agreement by reason of Section 8.01(b) or
9.01(b) thereof and which are not required to be indemnified against by the
Lessee pursuant to the Tax Indemnity Agreement, or (iv) claims against the
Lessor or the Owner Participant arising from the voluntary transfer by the
Lessor or the Owner Participant of its interests in the Aircraft other than a
transfer of the Aircraft pursuant to Section 4.02(a) or Article 10 or 11 of the
Lease and other than a transfer pursuant to the exercise of the remedies set
forth in Article 17 of the Lease.
Lien. Any mortgage, pledge, lien, charge, encumbrance, lease or
security interest or other similar interest.
Loss Payee. Has the meaning specified in Section 13.02(b)(i) of
the Lease.
Majority in Interest of Certificate Holders. As of a particular
date of determination, the Holders of more than 50% of the aggregate unpaid
principal amount of all Certificates outstanding as of such date excluding for
purposes of this definition any Certificates held by (i) the Owner Trustee or
the Owner Participant or any interests of the Owner Participant unless all
Certificates then outstanding shall be held by the Owner Participant, (ii) the
Lessee or (iii) any Affiliate of any thereof.
Make-Whole Premium. An amount determined as of the day before the
applicable Prepayment Date (or date of purchase, as the case may be) which an
Independent Investment Banker determines to be equal to the excess, if any, of
(i) the present values of all remaining scheduled payments of such principal
amount or portion thereof and interest thereon (excluding interest accrued
from the immediately preceding Payment Date to such Prepayment Date or date of
purchase, as the case may be) to the Maturity of such Certificate in
accordance with generally accepted financial practices assuming a 360-day year
consisting of twelve 30-day months at a discount rate equal to the Treasury
Yield, all as determined by the Independent Investment Banker over (ii) the
unpaid principal amount of such Certificate.
Manufacturer. Airbus Industrie G.I.E., a groupement d'interet
economique formed under the laws of France, and its successors and assigns.
Maturity. With respect to any Certificate, the date on which the
final principal amount of such Certificate is scheduled to be due and payable.
Moody's. ▇▇▇▇▇'▇ Investors Service, Inc.
Net Present Value of Rents. The net present value, as of the
Delivery Date, of Basic Rent set forth in Schedule II of the Lease, discounted
at a rate equal to the Debt Rate per annum compounded semi-annually.
Non-U.S. Person. Any Person other than a U.S. Person.
Obsolete Parts. Parts which are severable from the Aircraft in
accordance with clauses (ii) and (iii) of the proviso to Section 9.02(b) of
the Lease and the Lessee in good faith determines to be obsolete or no longer
suitable or appropriate for use on the Airframe or any Engine.
Officer's Certificate. When delivered pursuant to the Indenture, a
certificate signed by a Responsible Officer of the Lessee or the Owner
Trustee, as the case may be, and delivered to the Indenture Trustee. Each
such certificate shall include the statements provided for in Section 15.07 of
the Indenture.
Operative Agreements. The Participation Agreement, the Trust
Agreement, AVSA's FAA ▇▇▇▇ of Sale, AVSA's Warranty ▇▇▇▇ of Sale, the Airbus
Guaranty, the Purchase Agreement, the Purchase Agreement Assignment, the GTA,
the Engine Warranty Assignment, the French Pledge Agreement, the Lease, the
Lease Supplement, the Owner Participant Guaranty, if any, the Owner Trustee
Guaranty, if any, any Ancillary Agreement entered into by or with the written
consent of the Indenture Trustee, which by its terms is an Operative
Agreement, the Certificates outstanding at the time of reference, the
Indenture, the Indenture and Security Agreement Supplement, the Consent and
Agreement, the AVSA Consent and Agreement, the Consent and Guaranty (to the
extent assigned by the Purchase Agreement Assignment), the Engine Consent, the
Tax Indemnity Agreement and any Assignment and Assumption Agreement, each as
amended from time to time.
Opinion of Counsel. When delivered pursuant to the Indenture, a
written opinion of legal counsel, who in the case of counsel (a) for the
Lessee may be (i) an attorney employed by the Lessee who is generally
empowered to deliver such written opinions, (ii) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ or a
successor firm or (iii) other counsel designated by the Lessee and reasonably
satisfactory to the Indenture Trustee and (b) for the Owner Trustee or the
Indenture Trustee, an attorney selected by such Person and, in the case of the
Owner Trustee, reasonably satisfactory to the Indenture Trustee.
Original Agreements. The documents and instruments delivered on
the Delivery Date in connection with the transactions contemplated by the
Original Participation Agreement.
Original Ancillary Agreement I. The Ancillary Agreement I (Federal
Express Corporation Trust No. N662FE), among the Lessee, the Owner
Participant, the Indenture Trustee and the Owner Trustee as it was originally
executed on the Delivery Date.
Original Indenture. The Trust Indenture, Mortgage and Security
Agreement (Federal Express Corporation Trust No. N662FE), dated as of
September 1, 1996, between the Owner Trustee and the Indenture Trustee, which
together with the Indenture and Security Agreement Supplement No. 1 (Federal
Express Corporation Trust No. N662FE), dated September 23, 1996 attached
thereto was recorded as one instrument by the FAA on September 25, 1996, and
assigned Conveyance Number 2A270116.
Original Lease. The Lease Agreement (Federal Express Corporation
Trust No. N662FE), dated as of September 1, 1996, between the Owner Trustee as
lessor, and the Lessee, which together with Lease Supplement No. 1 (Federal
Express Corporation Trust No. N662FE), dated September 23, 1996 attached
thereto was recorded as one instrument by the FAA on September 25, 1996, and
assigned Conveyance Number 2A270117.
Original Loan Certificates. The loan certificates issued on the
Delivery Date to the Original Loan Participants.
Original Loan Participants. The entities listed on Schedule I to
the Original Participation Agreement and their successors and assigns (other
than any assignees in connection with the Refunding Date).
Original Participation Agreement. The Participation Agreement
(Federal Express Corporation Trust No. N662FE), among the Lessee, the Owner
Participant, the Indenture Trustee, the Owner Trustee and the Original Loan
Participants as it was originally executed as of September 1, 1996.
Original Tax Indemnity Agreement. The Tax Indemnity Agreement
(Federal Express Corporation Trust No. N662FE) between the Lessee and the Owner
Participant as it was originally executed as of September 1, 1996.
Original Trust Agreement. The Trust Agreement (Federal Express
Corporation Trust No. N662FE) between the Owner Participant and the Owner
Trustee as it was originally executed as of September 1, 1996 and filed with
the FAA on September 23, 1996.
Outstanding. When used with respect to Certificates, as of the
date of determination and subject to the provisions of Section 10.04 of the
Indenture, all Certificates theretofore executed and delivered under the
Indenture, with the exception of the following:
(i)Certificates theretofore cancelled by the Indenture Trustee or
delivered to the Indenture Trustee for cancellation pursuant to
Section 2.08 of the Indenture or otherwise;
(ii)Certificates for which prepayment money in the necessary amount
has been theretofore deposited with the Indenture Trustee in trust
for the Holders of such Certificates pursuant to Section 14.01 of
the Indenture; provided, that if such Certificates are to be
prepaid, notice of such prepayment has been duly given pursuant to
the Indenture or provision therefor satisfactory to the Indenture
Trustee has been made; and
(iii)Certificates in exchange for or in lieu of which other
Certificates have been executed and delivered pursuant to Article
II of the Indenture.
Owner Participant. The trustor originally named in the Trust
Agreement and any successor thereto, and any Person to which Owner Participant
transfers, in accordance with the Trust Agreement, its right, title and
interest in and to the Operative Agreements and the Lessor's Estate.
Owner Participant Guarantor. The provider of an Owner Participant
Guaranty.
Owner Participant Guaranty. Any guaranty delivered in compliance
with Section 7.03(d) of the Participation Agreement.
Owner Trustee. FSB, not in its individual capacity except as
otherwise expressly stated, but solely as Owner Trustee under the Trust
Agreement, and its successors and permitted assigns.
Owner Trustee Guarantor. The provider of an Owner Trustee
Guaranty.
Owner Trustee Guaranty. Any guaranty delivered in compliance with
Section 11.01(b)(ii) of the Participation Agreement.
Owner's Economic Return. The Owner Participant's anticipated net
after-tax book yield and aggregate after-tax cash during the Interim Term and
the Basic Term utilizing the multiple investment sinking fund method of
analysis, computed on the basis of the same methodology and assumptions as
were utilized by the Owner Participant in determining Basic Rent, Stipulated
Loss Value and Termination Value percentages, as the case may be, as such
assumptions may be adjusted for events which have been the basis of
adjustments to Rent pursuant to Section 3.04 of the Lease.
Participation Agreement. The Participation Agreement (Federal
Express Corporation Trust No. N662FE), dated as of September 1, 1996, as
amended and restated as of October 15, 1996, among the Lessee, the Original
Loan Participants, the Owner Trustee not in its individual capacity except as
otherwise expressly provided therein, but solely as owner trustee, the Owner
Participant, the Indenture Trustee not in its individual capacity except as
otherwise expressly provided therein, but solely as indenture trustee and the
Pass Through Trustee not in its individual capacity except as otherwise
expressly provided therein, but solely as pass through trustee, as amended,
modified or supplemented, or the terms thereof waived.
Parts. All appliances, parts, components, instruments,
appurtenances, accessories, furnishings and other equipment of whatever nature
(other than complete Engines or engines) which may from time to time be
incorporated or installed in or attached to the Airframe or any Engine or
title to which remains vested in the Lessor pursuant to Article 8 of the Lease.
Pass Through Agreement. The Pass Through Trust Agreement dated as
of June 1, 1996 between the Lessee and the Pass Through Trustee, as such Pass
Through Agreement may be modified, supplemented or amended from time to time in
accordance with the provisions thereof.
Pass Through Certificates. Any of the 1996 Pass Through
Certificates, Series B1 or 1996 Pass Through Certificates, Series B2, in each
case as issued by the related Pass Through Trust; and "Pass Through
Certificates" means both of the Pass Through Certificates issued by each of
the Pass Through Trusts.
Pass Through Closing Date. The Business Day on which the sale of
the Pass Through Certificates to the Underwriters pursuant to the Underwriting
Agreement takes place.
Pass Through Trust. The Federal Express Pass Through Trust,
1996-B1 or Federal Express Pass Through Trust, 1996-B2, in each case formed
pursuant to the related Series Supplement in accordance with the Pass Through
Agreement; and "Pass Through Trusts" means both of such Pass Through Trusts.
Pass Through Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, in its capacity as Pass Through Trustee under the
Pass Through Agreement and each Pass Through Trust, and its successors and
permitted assigns as Pass Through Trustee thereunder.
Past Due Rate. In respect of (A) any amount payable to the Owner
Participant or the Owner Trustee a rate per annum during the period from and
including the due date to but excluding the date on which such amount is paid
in full equal to 2% plus the Debt Rate and (B) any principal of or interest on
any Certificate or any other amount payable under the Indenture, any
Certificate or any other Operative Agreement that is not paid when due
(whether at Maturity, by acceleration, by optional or mandatory prepayment or
otherwise) to any Holder, the Indenture Trustee or the Pass Through Trustee, a
rate per annum during the period from and including the due date to but
excluding the date on which such amount is paid in full equal to (i) in the
case of any such amount payable to the Holder of any Certificate, 2% plus the
interest rate applicable to such Certificate and (ii) in the case of any other
such amount, 2% plus the Debt Rate.
Payment Date. December 23, 2019 and each January 30 and July 30
commencing on January 30, 1997.
Payment Default. Any event specified in Section 16.01(a) or
16.01(b) of the Lease which with the giving of notice or lapse of time or both
would constitute an Event of Default.
Permitted Investments. Those investments enumerated in Section
23.01(a) (i), (ii), (iii) and (iv) of the Lease.
Person. Any individual, sole proprietorship, partnership, joint
venture, joint stock company, trust, unincorporated organization, association,
corporation, institution, entity or government (federal, state, local, foreign
or any agency, instrumentality, division or body thereof).
Preliminary Notice. Has the meaning specified in Section 4.01(a)
of the Lease.
Premium Termination Date. With respect to the Certificates having
a Maturity in 2012, October 23, 2006 and with respect to the Certificates
having a Maturity in 2018, June 23, 2016.
Prepayment Date. Has the meaning specified in Section 6.02(b) of
the Indenture.
Prepayment Price. Has the meaning specified in Section 6.02(b) of
the Indenture.
Property. Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
Proposed Termination Date. The proposed date of termination of the
Lease as specified by the Lessee in its notice given pursuant to Section 10.01
thereof.
Purchase Agreement. The Airbus A300-600R Freighter Purchase
Agreement, dated as of July 3, 1991 between AVSA and the Lessee, including all
exhibits, appendices and letter agreements attached thereto as originally
executed or as modified, amended or supplemented in accordance with the terms
thereof, but only to the extent that the foregoing relates to the Aircraft and
to the extent assigned pursuant to the Purchase Agreement Assignment.
Purchase Agreement Assignment. The Purchase Agreement Assignment
(Federal Express Corporation Trust No. N662FE), dated as of September 1, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
Purchase Price. The amount specified as such in Ancillary
Agreement II.
Record Date. With respect to Payment Dates under the Indenture
(except a date for payment of defaulted interest), January 15 for January 30
Payment Dates and July 15 for July 30 Payment Dates, whether or not such date
is a Business Day.
Recourse Amount. Has the meaning specified in Section 17.10 of the
Participation Agreement.
Refinancing. A non-recourse loan to the Lessor arranged pursuant
to Section 15.01 of the Participation Agreement.
Refunding Date. A Business Day on which the refunding of the
Original Loan Certificates occurs, the expected date thereof having been
specified by the Lessee in a written notice given to the parties to the
Participation Agreement and the Underwriters at least three (3) Business Days
prior to such expected Refunding Date.
Register. Has the meaning set forth in Section 3.02 of the
Indenture.
Registrar. Has the meaning set forth in Section 3.02 of the
Indenture.
Regulation D. Regulation D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
Remaining Weighted Average Life. For any Certificate, as of any
determination date, the number of years obtained by dividing (a) the sum of the
products obtained by multiplying (i) the amount of each then remaining
mandatory sinking fund redemption payment of principal, including the payment
due on the Maturity of such Certificate, by (ii) the number of years
(calculated to the nearest one-twelfth) which will elapse between such
determination date, and the date on which such payment is scheduled to be
made, by (b) the then outstanding principal amount of such Certificate.
Renewal Rent. The amount payable by the Lessee as rent in
accordance with Section 4.01 of the Lease during any Renewal Term.
Renewal Term. One or more terms with respect to which the Lessee
has exercised its option to renew the Lease pursuant to Section 4.01(a)
thereof.
Rent. All payments due from the Lessee under the Lease as Basic
Rent, Renewal Rent and Supplemental Rent, collectively.
Rent Payment Date. December 23, 2019 and each January 30 and July
30 commencing on January 30, 1997.
Reoptimization Date. Has the meaning specified in Section
15.02(a) of the Participation Agreement.
Replacement Aircraft. Any aircraft substituted for the Aircraft
pursuant to Section 11.03(a) of the Lease.
Replacement Airframe. Has the meaning set forth in Section 11.03
of the Lease.
Replacement Engine. A General Electric CF6-80C2-A5F engine (or an
engine of the same or another manufacturer) of equal or greater value,
airworthiness, remaining useful life and utility as the Engine being replaced,
together with all Parts relating to such engine; provided, however, that if
such replacement engine is not a General Electric CF6-80C2-A5F engine, such
replacement engine must then be commonly used in the commercial aviation
industry on Airbus A300-600 airframes.
Responsible Officer. With respect to the Owner Trustee (except for
purposes of the Trust Agreement in which case the definition of Responsible
Officer set forth in Section 3.10 of the Trust Agreement is applicable) or the
Indenture Trustee, any officer in its Corporate Trust Administration, as the
case may be, designated by such Person to perform obligations under the
Operative Agreements, and with respect to any other party, any corporate
officer or (except in the case of the Owner Participant) other employee of a
party who, in the normal performance of his or her operational
responsibilities, with respect to the subject matter of any covenant,
agreement or obligation of such party pursuant to any Operative Agreement,
would have responsibility for and knowledge of such matter and the
requirements of any Operative Agreement with respect thereto.
S&P. Standard & Poor's Ratings Group.
SEC. The Securities and Exchange Commission of the United States
and any successor agencies or authorities.
SSB. State Street Bank and Trust Company, a Massachusetts trust
company.
Securities Act. The Securities Act of 1933, as amended.
Series Supplement. The Series Supplement 1996-B1 to be executed
and delivered by the Lessee and the Pass Through Trustee or the Series
Supplement 1996-B2 to be executed and delivered by the Lessee and the Pass
Through Trustee, in each case as such Series Supplement may be modified,
supplemented or amended from time to time in accordance with the provisions
thereof and "Series Supplements" means both such Series Supplements.
Sinking Fund Redemption Date. Has the meaning specified in Section
6.06 of the Indenture.
Sinking Fund Redemption Price. Has the meaning specified in
Section 6.06 of the Indenture.
Special Aviation Counsel. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇.
Stipulated Loss Value. As of any Stipulated Loss Value
Determination Date during the Basic Term, the amount determined by multiplying
the Purchase Price by the percentage set forth in Schedule III of the Lease
under the heading "Stipulated Loss Value Factor" opposite such date (as such
Schedule III may be adjusted from time to time as provided in Section 3.04 of
the Lease), and during any Renewal Term, the amount determined pursuant to
Section 4.01(b) of the Lease. Notwithstanding any other provisions of the
Lease or the Participation Agreement or the Indenture, each Stipulated Loss
Value for the Aircraft shall be, under any circumstances and in any event, an
amount, together with so much of the arrears portion of Basic Rent due and
owing through the date of payment of Stipulated Loss Value as does not
constitute an Excepted Payment, at least sufficient to pay in full as of such
date of payment the aggregate unpaid principal amount of and accrued interest
on the Certificates outstanding on such date of payment. Subject to the
immediately preceding sentence, it is understood and agreed that the amounts
set forth on Schedule III of the Lease, for dates other than Rent Payment
Dates on which arrears Basic Rent is due, fully reflect appropriate Basic Rent
accruals and credits of unearned Basic Rent through such date and,
accordingly, no further accrual or credit shall be required through such date
whenever Stipulated Loss Value is to be calculated with reference to any such
date; provided that if amounts in respect of Stipulated Loss Value are payable
under the Operative Agreements after the Stipulated Loss Determination Date in
respect of which such Stipulated Loss Value was determined, the Lessor shall
be compensated during the period from the Stipulated Loss Determination Date
to such payment date in accordance with the provisions of the Operative
Agreements.
Stipulated Loss Value Determination Date. Each date set forth on
Schedule III of the Lease under the heading "Stipulated Loss Value Date."
Supplemental Rent. All amounts, liabilities and obligations which
the Lessee assumes or agrees to perform or pay under the Lease or under the
Participation Agreement or Tax Indemnity Agreement or any Ancillary Agreement
or any other Operative Agreement to the Lessor, the Owner Participant, the
Indenture Trustee or others, including, without limitation, payments of
Stipulated Loss Value, FPO Price and amounts calculated by reference to
Termination Value, any amounts of Make-Whole Premium payable under the
Indenture to the extent provided in Section 3.03 of the Lease, and all amounts
required to be paid by Lessee under the agreements, covenants and indemnities
contained in the Lease or in the Participation Agreement or the Tax Indemnity
Agreement or any other Operative Agreement, but excluding Basic Rent.
Tax. Has the meaning set forth in Section 8.01(a) of the
Participation Agreement.
Tax Indemnity Agreement. The Original Tax Indemnity Agreement as
amended by Amendment No. 1 to the Original Tax Indemnity Agreement, as from
time to time modified, amended or supplemented pursuant to its applicable
provisions.
Term. The Interim Term and the Basic Term of the lease for the
Aircraft under the Lease and, if renewed pursuant to Section 4.01 of the
Lease, each Renewal Term for the Aircraft for which the Lease is renewed, or
such earlier date on which the Lease is terminated pursuant to its terms.
Termination Date. A Rent Payment Date during the Basic Term that
is on or after December 31, 2003 in the case of Article 10 of the Lease, and
in the case of (i) Section 4.02(a)(A) of the Lease, the Rent Payment Date
falling on January 30, 2017, (ii) Section 4.02(a)(D) or (E) of the Lease, a
Rent Payment Date that is on or after the seventh anniversary of the
Commencement Date and (iii) Section 4.02(a)(F) of the Lease, the last day of
the Basic Term.
Termination Value. As of any Termination Date, the amount
determined by multiplying the Purchase Price by the percentage set forth in
Schedule IV of the Lease under the heading "Termination Value Factor" opposite
such Termination Date (as such Schedule IV may be adjusted from time to time
as provided in Section 3.04 of the Lease). Notwithstanding any other
provisions of the Lease, the Participation Agreement or the Indenture, each
Termination Value shall be, under any circumstances and in any event, an
amount, together with so much of the arrears portion of Basic Rent due and
owing through the date of payment of any amount calculated by reference to
Termination Value as does not constitute an Excepted Payment, at least
sufficient to pay in full as of such date of payment the aggregate unpaid
principal amount of and accrued interest on the Certificates outstanding on
such date of payment. Subject to the immediately preceding sentence, it is
understood and agreed that the amounts set forth on Schedule IV of the Lease,
for dates other than Rent Payment Dates on which arrears Basic Rent is due,
fully reflect appropriate Basic Rent accruals and credits of unearned Basic
Rent through such date and, accordingly, no further accrual or credit shall be
required through such date whenever Termination Value is to be calculated with
reference to any such date; provided that if amounts in respect of Termination
Value are payable under the Operative Agreements after the Termination Date in
respect of which such Termination Value was determined, the Lessor shall be
compensated during the period from the Termination Date to such payment date
in accordance with the provisions of the Operative Agreements.
Transaction Costs. Those costs and expenses set forth in Section
10.01(a) of the Participation Agreement.
Transportation Code. Title 49 of the United States Code, as
amended and in effect on the date of the Lease or as subsequently amended, or
any successor or substituted legislation at the time in effect and applicable,
and the regulations promulgated pursuant thereto.
Treasury Yield. (i) In the case of a Certificate having a
Maturity within one year after the Prepayment Date the average yield to
maturity on a government bond equivalent basis of the applicable United States
Treasury ▇▇▇▇ due the week of Maturity of such Certificate and (ii) in the
case of a Certificate having a Maturity one year or more after the Prepayment
Date, the average yield of the most actively traded United States Treasury
Note (as reported by Cantor ▇▇▇▇▇▇▇▇▇▇ Securities Corp. on page 5 of Telerate
Systems, Inc., a financial news service, or if such report is not available,
a source deemed comparable by the Independent Investment Banker selected to
determine the Make-Whole Premium and reasonably acceptable to the Lessee)
corresponding in maturity to the Remaining Weighted Average Life of such
Certificate (or, if there is no corresponding maturity, an interpolation of
maturities by the Independent Investment Banker), in each case determined by
the Independent Investment Banker selected to determine the Make-Whole Premium
based on the average of the yields to stated maturity determined from the bid
prices as of 10:00 a.m. and 2:00 p.m. New York time, on the second Business
Day preceding the Prepayment Date.
Trust Agreement. The Trust Agreement (Federal Express Corporation
Trust No. N662FE), dated as of September 1, 1996, as amended and restated as of
October 15, 1996, between the Owner Participant and the Owner Trustee in its
individual capacity, as from time to time modified, amended or supplemented
pursuant to its applicable provisions and in accordance with the Operative
Agreements.
Trust Estate. The Lessor's Estate.
Trust Indenture Act. The Trust Indenture Act of 1939, as amended.
Trust Indenture Estate. All estate, right, title and interest of
the Indenture Trustee in and to any of the property, rights, interests and
privileges granted to the Indenture Trustee pursuant to the Granting Clause of
the Indenture, other than Excepted Payments and any and all other rights of
the Owner Trustee or the Owner Participant expressly reserved to the Owner
Trustee or the Owner Participant pursuant to the Indenture.
Underwriters. ▇▇▇▇▇▇▇, Sachs & Co., ▇.▇. ▇▇▇▇▇▇ Securities Inc.,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, BA Securities, Inc. and First Chicago
Capital Markets, Inc.
Underwriting Agreement. The Underwriting Agreement dated October
17, 1996 among the Lessee and the Underwriters.
United States, U.S. or US. The United States of America.
U.S. Air Carrier. Any United States air carrier as to which there
is in force a certificate issued pursuant to Section 41102(a) or Section 41103
of the Transportation Code, and as to which there is in force an air carrier
operating certificate issued pursuant to Chapter 447 of the Transportation
Code and Part 121 of the regulations under such Transportation Code, for
aircraft capable of carrying ten (10) or more individuals or 6,000 pounds or
more of cargo, or which may operate as an air carrier by certification or
otherwise under any successor or substitute provision thereof or in absence
thereof.
U.S. Person. A Person described in Section 7701(a)(30) of the
Code.
SCHEDULE III
PERMITTED COUNTRY LIST
Australia Netherlands
Austria New Zealand
Belgium Norway
Canada Philippines
Denmark Portugal
Finland Republic of China
(Taiwan)
France
Singapore
Germany
Sweden
Greece
Switzerland
Iceland
Thailand
Ireland
United Kingdom
Japan
Luxembourg
EXHIBIT A(1)(a)
[Letterhead of Federal Express]
[Refunding Date]
To the Addressees Listed on Schedule A Attached
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
I am the Vice President - Law of Federal Express Corporation, a
Delaware corporation ("Federal"), and am familiar with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N662FE), dated as of September 1, 1996, as amended and restated as of
October 15, 1996 (the "Participation Agreement"), among Federal, as Lessee,
PMCC Leasing Corporation, as Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company
of New York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as Original Loan Participants, First Security Bank, National Association, a
national banking association, not in its individual capacity, except as
otherwise stated, but solely as Owner Trustee under the Trust Agreement, State
Street Bank and Trust Company, a Massachusetts trust company, not in its
individual capacity, except as otherwise stated, but solely as Indenture
Trustee under the Indenture and State Street Bank and Trust Company, as Pass
Through Trustee, relating to the Aircraft. This opinion is being delivered
pursuant to Section 4.01(l)(i) of the Participation Agreement. Capitalized
terms not otherwise defined herein have the meaning assigned thereto in the
Participation Agreement.
The Participation Agreement provides, among other things, for the
refinancing in full of the Original Loan Certificates evidencing the Original
Loan Participants' participation in the payment of the Purchase Price of one
Airbus A300F4-605R aircraft (the "Aircraft"), using the proceeds from the
public offering of the Pass Through Certificates. Two Series of Pass Through
Certificates will be issued by two Pass Through Trusts formed to acquire,
among other securities, the Certificates bearing a particular interest rate
and having a particular Maturity that will be issued under the Trust Indenture
and Security Agreement (Federal Express Corporation Trust No. N662FE) dated as
of September 1, 1996, as amended and restated as of October 15, 1996, as
supplemented by the related Indenture and Security Agreement Supplement
("Indenture"), between the Owner Trustee and the Indenture Trustee.
In connection with the opinions expressed below, I have examined or
caused to be examined by attorneys under my supervision, executed counterparts
of the Operative Agreements, the Pass Through Agreement and each Series
Supplement (the "Transaction Agreements"). We have relied upon originals or
copies, certified or otherwise identified to our satisfaction, of such
corporate records, documents and other instruments as in our judgment are
relevant to rendering the opinions expressed below. As to any facts material
to the opinions expressed below (other than any thereof relating to Federal),
we have relied upon the representations and warranties made in the Transaction
Agreements, the accuracy of which we have not independently investigated or
verified. In such examination, we have assumed the genuineness of all
signatures (other than the signatures of Federal) and the authenticity of all
documents submitted to us as originals and the conformity with the originals of
all documents submitted to us as copies. We have also assumed that each of the
parties to each of the Transaction Agreements, other than Federal, has full
power, authority and legal right to enter into such Transaction Agreements and
that each such Transaction Agreement has been duly authorized, executed and
delivered by each of such parties.
Based on the foregoing, it is my opinion that:
1. Federal is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has or had, on the date of execution thereof, the
corporate power and authority to carry on its business as currently conducted
and to enter into and perform its obligations under the Transaction Agreements
to which it is a party. Federal is duly qualified to do business and is in
good standing in the State of Tennessee and each other state of the United
States in which its operations or the nature of its business requires Federal
to so qualify, except where the failure to so qualify would not have a
material adverse impact on Federal or its business.
2. Federal possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents which are material to
the operation of the routes flown by it and the conduct of its business and
operations as currently conducted, and each such certificate, franchise,
license, permit, right and concession and consent is in full force and effect.
3. Each of the Transaction Agreements to which Federal is a party
has or had, on the date of execution thereof, been duly authorized, executed
and delivered by Federal and each constitutes the legal, valid and binding
obligation of Federal enforceable against Federal in accordance with its terms.
4. Neither the execution and delivery by Federal of the Transaction
Agreements to which Federal is a party, nor the consummation of any of the
transactions by Federal contemplated thereby, nor the performance of the
obligations thereunder by Federal, did at the time of execution and delivery,
or does presently (a) require any stockholder approval or violate the
Certificate of Incorporation or By-laws of Federal or (b) conflict with or
contravene the provisions of, or constitute a default under, or result in the
creation of any Lien (other than Liens permitted under Section 6.01(a) of the
Lease) upon the property of Federal under any law, governmental rule or
regulation, or the charter or bylaws of Federal or any order, writ, injunction
or decree of any court or governmental authority against Federal or by which
any of its properties may be bound or any indenture, mortgage, contract or
other agreement known to me to which Federal is a party or by which it may be
bound or, require the approval or consent of any trustee or the holders of any
indebtedness or obligations of Federal.
5. Neither the execution and delivery by Federal of the Transaction
Agreements to which it is a party, nor the consummation of any transactions by
Federal contemplated thereby, nor the performance of the obligations
thereunder by Federal, did or does, as the case may be, (a) require the
consent or approval of, the giving of notice to, or (except as described or
contemplated in the Participation Agreement and the Lease, all of which are
required to be performed on or prior to the Refunding Date and which shall
have been accomplished on or prior to the Refunding Date) the registration
with, or the taking of any other action in respect of, the Aeronautics
Authority, the Securities and Exchange Commission or any other authority or
agency of the federal government or of the State of Tennessee other than (i)
the registration of the issuance and sale of the Pass Through Certificates
under the Securities Act, (ii) compliance with the securities laws of each
applicable state, and (iii) the filing of the Indenture, the Lease and the
Trust Agreement with the FAA, or (b) contravene any judgment or order
applicable to or binding on Federal or any law or governmental rule or
regulation of the United States or of the State of Tennessee.
6. There is no pending, or to my knowledge, threatened action or
proceeding before any court or administrative agency which individually (or in
the aggregate in the case of any group of related lawsuits) (i) is expected to
have a material adverse effect on (A) except for the matters described under
"Legal Proceedings" in Federal's Annual Report on Form 10-K for the fiscal
year ended May 31, 1996 (as updated by Note 7 to the financial statements
included in Federal's Quarterly Report on Form 10-Q for the fiscal quarter
ended August 31, 1996) and in Federal's Current Reports on Form 8-K dated June
7, 1996 and August 16, 1996, as to which I can express no opinion at this time
concerning Federal's liability (if any) or the effect of any adverse
determination upon the business, condition (financial or otherwise) or
operations of Federal, the financial condition of Federal or (B) the ability
of Federal to perform its obligations under the Transaction Agreements, or
(ii) involves the Aircraft.
7. Except for the filing and, where appropriate, recording,
pursuant to the Transportation Code of the Lease, the Indenture, the Trust
Agreement, the filing of the financing statements referred to in Section
4.01(f) of the Participation Agreement and the taking of possession by the
Indenture Trustee of the original counterpart of the Lease and maintaining
possession of the original counterpart of the Lease Supplement delivered on
the Delivery Date, no further action, including any filing or recording of any
document is necessary or advisable in order to establish and perfect the Owner
Trustee's title to and interest in the Aircraft as against Federal and any
third parties, or to perfect the first mortgage lien on the Aircraft in favor
of the Indenture Trustee in each case with respect to such portion of the
Aircraft as is covered by the recording system established by the
Transportation Code.
8. Federal is a duly certificated "air carrier" within the meaning
of the Transportation Code, and a holder of a certificate under Sections
41102(a) and 41103 of the Transportation Code, and an "air carrier operating
certificate" issued under Chapter 447 of the Transportation Code for aircraft
capable of carrying ten (10) or more individuals or 6,000 pounds or more of
cargo, and each such certificate is in full force and effect.
9. On the Delivery Date the Owner Trustee received good and valid
title to the Aircraft free and clear of all Liens on file with the FAA, except
for Liens permitted under Section 6.01(a) of the Lease. Pursuant to the
Original Participation Agreement the Aircraft was duly delivered to the Owner
Trustee. Federal, as Lessee, duly accepted the Aircraft under the Original
Lease and the Lease Supplement and the Term commenced on the Delivery Date.
10. Federal's principal place of business and chief executive
office (as such term is defined in the Uniform Commercial Code in effect in
the State of Tennessee) are located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇.
11. Federal is not, and is not directly or indirectly controlled by
or acting on behalf of any Person which is, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
The opinions expressed in paragraph 3 above as to the enforceability
of the Transaction Agreements to which Federal is a party are based upon the
assumption for purposes of such opinions and without independent analysis
that, notwithstanding the respective choice of laws clauses in the Transaction
Agreements, the governing law with respect to each of the Transaction
Agreements is identical in all relevant respects to the law of the State of
Tennessee. Insofar as the foregoing opinion relates to the enforceability of
any instrument, such enforceability is subject to applicable bankruptcy,
insolvency and other similar laws affecting the enforcement of creditors'
rights generally (whether such enforceability is considered in a proceeding in
equity or at law). The enforceability of the remedies provided under the
Lease may also be limited by applicable laws which may affect the remedies
provided therein but which do not in my opinion affect the validity of the
Lease or make such remedies inadequate for the practical realization of the
benefits intended to be provided thereby.
I do not express any opinion as to matters governed by any law other
than the Federal laws of the United States of America, the corporation law of
the State of Delaware and the laws of the State of Tennessee.
As to the matters referred to in paragraphs 5, 7 and 9, I have relied
on the opinion of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ of even date herewith, to the
extent such matters are addressed in such counsel's opinion and subject to the
assumptions and qualifications expressed therein.
This opinion is delivered to you solely for your use in connection
with the transaction described herein, and may not be used for any other
purpose, and may not be relied upon by any other person, without my prior
written consent.
I rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. I hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
SCHEDULE A
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(1)(b)
[Letterhead of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Parties named on Schedule A Hereto
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
We have acted as special counsel for Federal Express Corporation, a
Delaware corporation ("Federal Express"), in connection with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N662FE), dated as of September 1, 1996, as amended and restated as of
October 15, 1996 (the "Participation Agreement"), among Federal Express, as
Lessee, PMCC Leasing Corporation, as Owner Participant, ▇▇▇▇▇▇ Guaranty Trust
Company of New York, Bank of America National Trust & Savings Association, The
Chase Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A.
(South), as the Original Loan Participants, First Security Bank, National
Association, not in its individual capacity but solely as Owner Trustee under
the Trust Agreement, State Street Bank and Trust Company, not in its
individual capacity, except as otherwise stated, but solely as Indenture
Trustee under the Indenture, and State Street Bank and Trust Company, as Pass
Through Trustee, relating to the Aircraft. This opinion is being delivered
pursuant to Section 4.01(l)(viii) of the Participation Agreement. Capitalized
terms not otherwise defined herein have the meanings assigned thereto in the
Participation Agreement.
Pursuant to the Original Participation Agreement, the Owner
Participant and the Original Loan Participants participated in the payment of
the Purchase Price of one Airbus A300F4-605R Aircraft which was purchased by
the Owner Trustee pursuant to AVSA's FAA ▇▇▇▇ of Sale and AVSA's Warranty ▇▇▇▇
of Sale, subjected to the Lien of the Original Indenture and leased to Federal
Express under the Original Lease. The Participation Agreement provides, among
other things, for the refinancing of the Original Loan Certificates using the
proceeds from the public offering of the Pass Through Certificates. Two
Series of Pass Through Certificates will be issued by separate Pass Through
Trusts, each formed to acquire, among other securities, the Certificates
bearing a particular interest rate and having a particular Maturity that will
be issued under the Indenture.
In connection with the opinions expressed below, we have examined
executed counterparts of the Operative Agreements, the Pass Through
Certificates, the Pass Through Agreement and each Series Supplement (the
"Transaction Agreements"). We have also examined originals, or copies
certified to our satisfaction, of such other agreements, documents,
certificates and statements of governmental officials and corporate officers
as we have deemed necessary or advisable as a basis for such opinions. In
such examination, we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
As to any facts material to our opinions expressed below, we have,
with your consent, relied on the representations and warranties made in or
pursuant to the Participation Agreement and the other documents referred to
therein, the accuracy of which we have not independently verified. In
addition, we have, when relevant facts were not independently established by
us, relied, to the extent we deemed such reliance proper, upon certificates of
public officials and certificates, telegrams and other written or telephoned
statements of officers of the parties referred to herein.
Based on the foregoing, it is our opinion that:
1. With respect to that portion, if any, of the Aircraft and the
other property included in the Lessor's Estate as may not be covered by the
recording system established by the FAA pursuant to Section 44107 of the
Transportation Code, no filing or recording of any document or other action
was or is necessary in order to establish the Owner Trustee's title thereto
and interest therein as against Federal Express and any third parties.
2. The Lease creates a valid leasehold interest in the Aircraft,
the entitlement thereof to the benefits of recordation under the
Transportation Code being subject to the due and timely filing and, where
appropriate, recording of (A) the Lease (with the Indenture attached as an
exhibit), (B) the Indenture and (C) the Trust Agreement.
3. Assuming (i) the due authorization, execution and delivery of
the Transaction Agreements by each of the parties to each such document (other
than Federal Express), (ii) each such party has full power and legal right to
enter into and perform its respective obligations under the Transaction
Agreements, (iii) that the execution, delivery and performance by each of the
Transaction Agreements by each of the parties thereto will not violate the
respective parties' constituent documents, (iv) the due authorization,
execution, issuance and delivery by the Owner Trustee, and the due
authentication by the Indenture Trustee, of the Certificates to be issued
under the Indenture in accordance with the terms of the Indenture, (v) that
the Original Loan Certificates are delivered by the Original Loan Participants
to the Indenture Trustee for cancellation and are cancelled, (vi) the due
authorization, execution, issuance, delivery and authentication by the Pass
Through Trustee of the Pass Through Certificates to be issued under the Pass
Through Agreement and the Series Supplement relating to such Pass Through
Certificates, in each case in accordance with the terms of the Pass Through
Agreement and such Series Supplement, and (vii) that the form of each
Transaction Agreement is in compliance with all applicable laws and
governmental rules and regulations (other than the laws of the United States
and the State of New York), then: (A) to the extent governed by New York law,
each Transaction Agreement in form constitutes a legal, valid and binding
agreement of each party thereto enforceable against each such party in
accordance with its terms; (B) the Original Indenture created, and the
Indenture creates, for the benefit of the Holders, the security interest in
the Trust Indenture Estate that they purport to create; (C) the Certificates,
when issued to and acquired by the Pass Through Trustee, will be legal, valid
and binding obligations of the Owner Trustee enforceable against the Owner
Trustee in accordance with their terms and the terms of the Indenture and will
be entitled to the benefits of the Indenture, including the benefit of the
security interest created thereby; (D) the Pass Through Certificates, when
issued to and acquired by the Underwriters in accordance with the Underwriting
Agreement, will be legal, valid and binding obligations of the Pass Through
Trustee enforceable against the Pass Through Trustee in accordance with their
terms and will be entitled to the benefits of the Pass Through Agreement and
the Series Supplement relating thereto; and (E) the beneficial interest of the
Owner Participant under the Trust Agreement in and to the properties which are
part of the Trust Indenture Estate is subject, to the extent provided in the
Indenture, to the Lien of the Indenture in favor of the Holders. The opinions
set forth in this paragraph 3 are subject to the due filing and, where
appropriate, recording with the FAA of the documents referred to in paragraph
2 above.
4. (a) Each of the Transaction Agreements to which Federal Express
is a party has been duly authorized, executed and delivered by Federal Express.
(b) The execution, delivery and performance by Federal Express of
each of the Transaction Agreements to which Federal Express is a party do not,
or did not on the date of execution thereof, violate, and fully comply, or did
fully comply on the date of execution thereof, with, any laws and governmental
rules and regulations of the State of New York that may be applicable to
Federal Express. The opinion set forth in this paragraph 4(b) is rendered
without regard to the taking of any action or the conduct of any other
business by Federal Express in the State of New York other than the
transactions contemplated by the Transaction Agreements.
5. The execution, delivery and performance of the Participation
Agreement, the Trust Agreement, the Indenture and the Lease by the Owner
Trustee in its individual or trust capacity, as the case may be, and the
issuance, execution, delivery and performance of the Certificates by the Owner
Trustee in its trust capacity do not violate, and fully comply with, any laws
and governmental rules and regulations of the State of New York that may be
applicable to the Owner Trustee in its individual or trust capacity, as the
case may be. The opinion set forth in this paragraph 5 is rendered without
regard to the effect, if any, on such issuance (in the case of the
Certificates), execution, delivery or performance, of the taking of any
action, the conduct of any business or the exercise of any other powers by
First Security Bank, National Association in its individual or trust capacity
in the State of New York not related to the transactions contemplated by the
Transaction Agreements. We have assumed that First Security Bank, National
Association has made the filings necessary to comply with Section 131.3 of the
Banking Law of the State of New York, however we express no opinion as to
whether First Security Bank, National Association is required to comply with
said Section 131.3.
6. All the properties which are part of the Trust Indenture Estate
(including all right, title and interest of the Owner Trustee pledged and
mortgaged by it pursuant to the Indenture in and to the Aircraft and the
Lease) have been pledged and mortgaged with the Indenture Trustee as part of
the Trust Indenture Estate (subject to the due filing and, where appropriate,
recording of those documents referred to in paragraph 2 above and the
financing statements referred to in Section 4.01(f) of the Participation
Agreement), and the beneficial interest of the Owner Participant under the
Trust Agreement in and to such properties are subject, to the extent provided
in the Indenture, to the Lien of the Indenture in favor of the Holders of the
Certificates issued and to be issued under the Indenture.
7. The Indenture creates, as security for the Certificates duly
issued and to be issued under the Indenture, the first priority security
interest in the Aircraft it purports to create, the perfection and rank
thereof being subject to the registration with the FAA of the Aircraft in the
name of the Owner Trustee and the due filing and, where appropriate, recording
in accordance with the Transportation Code of the documents referred to in
paragraph 2 above. We express no opinion with respect to the status of any
security interest in any portion of the Aircraft which does not constitute an
"aircraft" or "aircraft engine", as defined in paragraphs (6) and (7) of
Section 40102(a) of the Transportation Code.
8. Federal Express's participation in the transactions
contemplated by the Transaction Agreements does not and will not constitute a
violation of Section 7 of the Securities Exchange Act of 1934.
9. Except for the filings and recordings referred to in paragraph
2 above, neither the execution and delivery by Federal Express of the
Participation Agreement or any other Operative Agreement to which it is a
party, nor the consummation of any of the transactions by Federal Express
contemplated thereby, requires the consent or approval of, the giving of
notice to, or the registration with, or the taking of any other action in
respect of, the Department of Transportation, the FAA, the Securities and
Exchange Commission or any other Federal or New York State governmental
authority.
10. It is not necessary, in connection with the creation of the
beneficial interest of the Owner Participant in the Trust Indenture Estate
under the circumstances contemplated by the Participation Agreement to
register such beneficial interest under the Securities Act of 1933, as
amended, or to qualify the Trust Agreement under the Trust Indenture Act of
1939, as amended.
11. The provisions of Section 1110 of the United States Bankruptcy
Code will apply to the Aircraft for the benefit of the Lessor, as lessor under
and by reason of the Lease. The Lease, including the rights under Section
1110 of the United States Bankruptcy Code, has been assigned to the Indenture
Trustee pursuant to the Indenture as part of the collateral for the
Certificates and, as assignee, the Indenture Trustee has the benefit of
Section 1110.
The foregoing opinions are subject to the following qualifications:
(a) We have relied, with your consent, without independent
investigation and verification and subject to the assumptions and
qualifications contained therein, upon the opinions of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Law of Federal Express to be
delivered to you and dated the date hereof, for purposes of the matters
covered thereby.
(b) We are qualified to practice law in the State of New York, and
we do not purport to be experts on, or to express any opinion herein
concerning, any laws other than the laws of the State of New York, the laws
of the United States and the General Corporation Law of the State of
Delaware. We express no opinion as to any matters involving aviation law.
(c) The opinion contained in paragraph 3(A) above as to
enforceability is subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity which may
affect the remedies provided in the agreements referred to in said
opinions, which laws and principles, however, do not in our opinion make
the remedies provided in said agreements inadequate for the practical
realization of the benefits of the security intended to be provided thereby.
(d) This opinion is rendered solely to you at Federal Express's
request in connection with the above matter. This opinion may not be
relied upon by you for any other purpose or relied upon by any other Person
without our prior written consent.
(e) We rendered an opinion dated September 23, 1996 (the "Delivery
Date Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent
and agree that the addressees hereto who were not addressees to the
Delivery Date Opinion may rely on the Delivery Date Opinion as fully and
with the same force and effect as if such addressees were originally named
therein on the date of the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(2)(a)
[Letterhead of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
We have acted as special New York counsel for PMCC Leasing Corporation
("PMCC") in connection with the transactions contemplated by the Participation
Agreement (Federal Express Corporation Trust No. N662FE), dated as of
September 1, 1996, as amended and restated as of October 15, 1996 (the
"Participation Agreement"), among Federal Express Corporation, as lessee,
First Security Bank, National Association, not in its individual capacity, but
solely as owner trustee, PMCC, as owner participant, State Street Bank and
Trust Company, not in its individual capacity but solely as indenture trustee,
State Street Bank and Trust Company, not in its individual capacity but solely
as pass through trustee and ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank
of America National Trust & Savings Association, The Chase Manhattan Bank,
Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South), as original loan
participants. This opinion is being furnished to you pursuant to Section
4.01(l)(ii) of the Participation Agreement. Capitalized terms used herein and
not otherwise defined herein shall have the meaning ascribed to them in the
Participation Agreement.
We have examined executed counterparts of the Participation Agreement,
Amendment No. 1 to the Tax Indemnity Agreement, Trust Agreement, Ancillary
Agreement I and Ancillary Agreement II (collectively, the "Owner Participant
Documents") and we have made such other and further investigations as we have
deemed necessary or appropriate for purposes of this opinion. In our
examination we have assumed, with your permission, and without independent
investigation or inquiry, the genuineness of all signatures, the authenticity
of all documents submitted to us as originals and the conformity to original
documents of all documents submitted to us as certified or photocopies and the
authenticity of the originals of such latter documents.
With your permission, we have further assumed that (i) the Owner
Participant Documents have been duly authorized, executed and delivered by
each of the parties thereto, (ii) the respective parties thereto have the
power and authority to execute, deliver and perform the Owner Participant
Documents, (iii) the execution, delivery and performance of the Owner
Participant Documents by the parties thereto do not and will not violate the
certificate of incorporation, by-laws or other organizational documents of any
such party or any bond, debenture, note, mortgage, indenture, lease or other
agreement or instrument to which any such party is a party or by which any
such party is bound and does and will fully comply with all laws and
regulations applicable to each such party and (iv) the Owner Participant
Documents constitute valid, legal and binding obligations of the parties
thereto (other than PMCC), enforceable against such parties (other than PMCC)
in accordance with their respective terms.
Based upon the foregoing, we are of the opinion that:
1. The Participation Agreement and the Amendment No. 1 to the Tax
Indemnity Agreement constitute valid and legally binding obligations of PMCC
enforceable against PMCC in accordance with their respective terms.
2. The execution and delivery by the Owner Participant of the Owner
Participant Documents and the making of its investment thereby will not result
in any violation of any Federal or New York statute or any order, rule or
regulation issued pursuant to any New York or Federal statute by any New York
or Federal Court or governmental agency or body having jurisdiction over the
Owner Participant.
3. No consent, approval, authorization, order, registration or
qualification under any Federal or New York statute is required to be obtained
by the Owner Participant for the execution and delivery by the Owner
Participant of the Owner Participant Documents or the making of its investment
thereby.
Our opinion in paragraph 1 is subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.
We are members of the Bar of the State of New York and express no
opinion herein concerning any law other than the laws of the State of New York.
This opinion is rendered to you in connection with the above-described
transaction. This opinion may not be relied by you for any other purpose, or
relied upon by or furnished to any other person, firm or corporation without
our prior written consent, except that the Owner Participant may furnish a
copy of this opinion to a potential transferee or participant of the interest
of such entity or otherwise as required by a governmental authority.
We rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(2)(b)
[Letterhead of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Capital Corporation]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
In my capacity as Assistant General Counsel and Assistant
Secretary of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Capital Corporation, a Delaware corporation, I
have supervised corporate proceedings of its wholly owned subsidiary, PMCC
Leasing Corporation, a Delaware corporation (the "Owner Participant"), in
connection with the Owner Participant's participation in the transactions
contemplated by that certain Participation Agreement (Federal Express
Corporation Trust No. N662FE), dated as of September 1, 1996, as amended
and restated as of October 15, 1996 (the "Participation Agreement"), among
the Owner Participant; Federal Express Corporation as Lessee; the Original
Loan Participants named in the Participation Agreement; First Security
Bank, National Association, not in its individual capacity, except as
otherwise stated, but solely as owner trustee; State Street Bank and Trust
Company, not in its individual capacity, except as otherwise stated, but
solely as indenture trustee and as pass through trustee. This opinion is
delivered pursuant to Section 4.01(l)(ii) of the Participation Agreement.
Capitalized terms used herein but not otherwise defined herein shall have
the respective meanings set forth in Schedule II to the Participation
Agreement.
In connection with this opinion, I have examined originals, or copies
certified or otherwise identified to my satisfaction of the Participation
Agreement, the Ancillary Agreement I, the Ancillary Agreement II, the
Amendment No. 1 to the Tax Indemnity Agreement, and the Trust Agreement (each
such Participation Agreement, Ancillary Agreement I, Ancillary Agreement II,
Amendment No. 1 to the Tax Indemnity Agreement and Trust Agreement to be
hereafter referred to individually as an "Operative Document" and collectively
as the "Operative Documents"). I have also examined such corporate documents,
records and instruments of the Owner Participant as in my judgment are
necessary or appropriate to enable me to render the opinions expressed below.
In rendering such opinions, I have relied upon the representations and
warranties contained in or made pursuant to the Operative Documents and have
assumed the due authorization, execution and delivery of all documents and
instruments by all parties thereto other than the Owner Participant.
Based on the foregoing and subject to the qualifications and matters
of reliance set forth herein, I am of the opinion that:
1. The Owner Participant is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, has
full corporate power, authority and legal right to carry on its business as
now conducted, and is duly authorized and empowered to execute and deliver
the Operative Documents and to fulfill and comply with the terms,
conditions and other provisions thereof.
2. The Operative Documents have been duly authorized by all necessary
corporate action on the part of the Owner Participant, and have been duly
executed and delivered by the Owner Participant.
3. No filing with, notice to or authorization or approval from any
governmental or public body or authority is required under the laws of the
State of New York, the laws of the United States of America, or the General
Corporation Law of the State of Delaware in connection with the execution,
delivery and performance by the Owner Participant of the Operative
Documents.
4. There are no actions, suits or proceedings (whether or not
purportedly on behalf of the Owner Participant) pending or, to my
knowledge, threatened against or affecting the Owner Participant or any
property rights of the Owner Participant at law or in equity or before any
commission or other administrative agency which, either individually or in
the aggregate, could materially and adversely affect the condition,
financial or otherwise, of the Owner Participant or its ability to perform
its obligations under the Operative Documents or which would affect the
legality, validity or enforceability of such Operative Documents.
5. Neither the execution and delivery of the Operative Documents, the
consummation of the transactions therein contemplated nor the fulfillment
of or compliance with the terms, conditions and other provisions thereof
will conflict with, or result in any breach of, any of the terms,
conditions or provisions of (i) any law or regulation binding upon the
Owner Participant, (ii) any order, injunction or decree of any court or
governmental instrumentality binding upon the Owner Participant, (iii) the
Certificate of Incorporation or Bylaws of the Owner Participant, or (iv) to
my knowledge, any bond, debenture, note, mortgage, indenture or other
agreement or instrument to which the Owner Participant is now a party or by
which the property of the Owner Participant may be bound.
I am a member of the bar of the State of New York, and I do not
purport to be conversant with, or to express any opinion herein concerning,
the laws of any jurisdiction other than those of the State of New York and the
United States of America and the General Corporation Law of the State of
Delaware. In addition, I express no opinion concerning the laws of the State
of New York, the United States of America or any other jurisdiction applicable
to the offering or sale of securities. Further, I have made no investigation
and express no opinion, as to any aviation law or other laws, statutes, rules
or regulations applicable due to the particular nature of the equipment
subject to the Lease.
This opinion is solely for the benefit of the addresses hereof and
their respective successors and assigns for use in connection with the
transactions contemplated by the Operative Documents and may not be relied
upon by any other person or for any other purpose without my express written
consent. This opinion may be relied upon by Messrs. Simpson, Thacher &
▇▇▇▇▇▇▇▇ in rendering their opinion of even date herewith.
I rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. I hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully, and with the same
force and effect as if such addressees were originally named therein on the
date of the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇ ▇. Rights
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(3)
[Letterhead of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇]
[Refunding Date]
To the Parties Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company, a Massachusetts trust company, individually ("State Street"), and as
Indenture Trustee (the "Indenture Trustee") under the Trust Indenture and
Security Agreement (Federal Express Corporation Trust No. N662FE), dated as of
September 1, 1996, as amended and restated as of October 15, 1996 (the
"Indenture") between First Security Bank, National Association, not in its
individual capacity but solely as Owner Trustee (the "Owner Trustee") and the
Indenture Trustee, in connection with the transactions contemplated by that
certain Participation Agreement (Federal Express Corporation Trust No.
N662FE), dated as of September 1, 1996, as amended and restated as of October
15, 1996 (the "Participation Agreement"), among Federal Express Corporation,
as Lessee (the "Lessee"); PMCC Leasing Corporation, as Owner Participant (the
"Owner Participant"); ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of
America National Trust & Savings Association, The Chase Manhattan Bank,
Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South), as Loan
Participants (the "Original Loan Participants"); the Owner Trustee; and the
Indenture Trustee. This opinion is being delivered pursuant to Section
4.01(l)(iii) of the Participation Agreement. Except as otherwise defined
herein, all capitalized terms used herein shall have the respective meanings
set forth in Schedule II to the Participation Agreement.
Our representation of State Street has been as special counsel for the
purposes stated above. As to all matters of fact (including factual
conclusions and characterizations and descriptions of purpose, intention or
other state of mind), we have relied entirely upon (i) the representations of
the parties set forth in the Operative Agreements and (ii) the certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations and certificates.
We have examined each Operative Agreement to which State Street or the
Indenture Trustee, as the case may be, is a party (collectively, the
"Indenture Trustee Documents"), the Certificate of the Massachusetts
Commissioner of Banks relating to State Street and originals, or copies
certified or otherwise identified to our satisfaction, of such other
documents, corporate records, certificates, or other instruments as we have
deemed necessary or advisable for the purposes of this opinion.
We have assumed the genuineness of all signatures (other than those on
behalf of State Street and the Indenture Trustee), the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form
and the legal competence of each individual executing any document (other than
on behalf of State Street and the Indenture Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we are
aware or which are known to us, or with another similar qualification, the
relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion, the
individual lawyers in the firm who have participated directly in the specific
transactions to which this opinion relates or in the preparation of this
opinion and the partner of the firm responsible for State Street corporate
trust matters, and without any special or additional investigation undertaken
for the purposes of this opinion.
Each opinion set forth below relating to the enforceability of any
agreement or instrument against State Street and the Indenture Trustee, as
applicable, is subject to the following general qualifications:
(i) as to any Indenture Trustee Document, we assume that such agreement is
the legal, valid and binding obligation of each other party thereto;
(ii) the enforceability of any obligation of State Street and the
Indenture Trustee may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, marshalling or other similar laws and
rules of law affecting the enforcement of rights and remedies (including such
as may deny giving effect to waivers of debtors' or guarantors' rights) of
creditors generally; and
(iii) the enforcement of any rights and availability of any specific or
equitable relief may in all cases by subject to an implied duty of good faith
and to general principals of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
Subject to the limitations set forth herein, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions expressed herein are limited solely to the internal
substantive laws of the Commonwealth of Massachusetts and the Federal laws of
the United States of America. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
other than our opinion expressed in Paragraph 1 hereof with respect to the
citizenship of State Street, no opinion is expressed as to matters governed by
the Transportation Code or by any other law, statute, rule or regulation of
the United States relating to the acquisition, ownership, registration, use,
operation, maintenance, repair, replacement or sale of or the nature of the
Aircraft, Airframe or the Engines.
With your permission and without investigation, with respect to
paragraph 4 below in connection with our opinion relating to the legality,
validity, binding effect and enforceability of the documents there referred
to, to the extent that the laws of the Commonwealth of Massachusetts do not
govern such documents, we have assumed that the laws of the jurisdiction whose
laws govern such documents are not materially different from the internal
substantive laws of the Commonwealth of Massachusetts.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their respective successors and assigns in
connection with the transactions contemplated by the Operative Agreements and
may not be used or relied upon by any other person or for any other purpose.
Based upon the foregoing, we are of the opinion that:
1. State Street is a Massachusetts trust company, duly organized
and validly existing in good standing with the Massachusetts Commissioner of
Banks under the laws of the Commonwealth of Massachusetts, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has the full corporate power and authority to
execute, deliver and perform its obligations under the Indenture Trustee
Documents and, in its capacity as Indenture Trustee, to authenticate the
Certificates delivered on the Refunding Date and to perform its other
obligations under the Indenture Trustee Documents.
2. The execution and delivery of the Indenture Trustee Documents by
State Street, in its individual capacity or as Indenture Trustee, as the case
may be, and compliance by State Street or the Indenture Trustee, as the case
may be, individually or as Indenture Trustee, as the case may be, with all of
the provisions thereof do not and will not contravene any Massachusetts or
Federal law, rule or regulation governing the banking or trust powers of State
Street or the Indenture Trustee, or any order or judgment known to us, of any
Massachusetts or Federal court or governmental authority applicable to or
binding on State Street, individually or as Indenture Trustee, or contravene
the provisions of, or constitute a default under, or result in the creation
of a Lien on any property of State Street or the Indenture Trustee under, its
charter documents or By-Laws or any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit agreement, in
each case known to us, or any other agreement or instrument, in each case
known to us, to which State Street, individually or as Indenture Trustee, is a
party or by which it or any of its property may be bound or affected, other
than the Lien of the Indenture.
3. No order, license, consent, permit, authorization or approval
of or exemption by, and no notice to or filing with, or the taking of any
other action in respect of, any Massachusetts or Federal governmental
authority governing the banking or trust powers of State Street or the
Indenture Trustee, and no filing, recording, publication or registration in
any public office is required under Massachusetts or Federal law pertaining to
its banking or trust powers for the due execution, delivery or performance by
State Street, individually or as Indenture Trustee, as the case may be, of the
Indenture Trustee Documents and of the certificate of authentication, as
Indenture Trustee, on the Certificates, or for the legality, validity, binding
effect or enforceability thereof against State Street or the Indenture
Trustee, as the case may be.
4. Each of the Indenture Trustee Documents has been duly
authorized, executed and delivered by State Street, in its individual capacity
or as Indenture Trustee, as the case may be, and each such document
constitutes a legal, valid and binding obligation of State Street, in its
individual capacity or as Indenture Trustee, as the case may be, enforceable
against State Street, in its individual capacity or as Indenture Trustee, as
the case may be, in accordance with its terms.
5. The Certificates issued and dated the Refunding Date have been
duly authenticated and delivered by the Indenture Trustee pursuant to the
terms of the Indenture.
6. There are no fees, taxes or other governmental charges payable
by the Owner Trustee, the Indenture Trustee (except taxes imposed on fees
payable to the Indenture Trustee in its individual capacity) or the
Certificate Holders under the laws of the Commonwealth of Massachusetts or any
political subdivision thereof in connection with the execution, delivery or
performance of any of the Operative Agreements or in connection with the
issuance and acquisition of the Certificates by the Certificate Holders or the
beneficial interest of the Certificate Holders in the Trust Indenture Estate
solely because the Indenture Trustee in its individual capacity (a) is
incorporated under the laws of the Commonwealth of Massachusetts, (b) has its
principal place of business in the Commonwealth of Massachusetts, (c) performs
(in its individual capacity or as Indenture Trustee) any or all of its duties
under the Indenture Trustee Documents in the Commonwealth of Massachusetts,
and (d) engages in any activities unrelated to the transactions contemplated
by the Indenture Trustee Documents in the Commonwealth of Massachusetts.
Neither the Indenture Trustee nor the trust created under the Indenture will
be subject to any fee, tax or other governmental charge (except for taxes
imposed on fees payable to the Indenture Trustee in its individual capacity)
under the laws of the Commonwealth of Massachusetts or any political
subdivision thereof in existence on the date hereof, on, based on or measured
by, directly or indirectly, the gross receipts, net income or value of the
Trust Indenture Estate solely because the Indenture Trustee in its individual
capacity (a) is incorporated under the laws of the Commonwealth of
Massachusetts, (b) has its principal place of business in the Commonwealth of
Massachusetts, (c) performs (in its individual capacity or as Indenture
Trustee) any or all of its duties under the Indenture Trustee Documents in the
Commonwealth of Massachusetts, and (d) engages in any activities unrelated to
the transactions contemplated by the Indenture Trustee Documents in the
Commonwealth of Massachusetts. There is no fee, tax or other governmental
charge (except for taxes imposed on fees payable to the Indenture Trustee in
its individual capacity) under the laws of the Commonwealth of Massachusetts
or any political subdivision thereof in existence on the date hereof, on,
based on or measured by any payments under the Certificates by reason of the
creation of the trust under the Indenture solely because the Indenture Trustee
in its individual capacity (a) is incorporated under the laws of the
Commonwealth of Massachusetts, (b) has its principal place of business in the
Commonwealth of Massachusetts, (c) performs (in its individual capacity or as
Indenture Trustee) any or all of its duties under the Indenture Trustee
Documents in the Commonwealth of Massachusetts, and (d) engages in any
activities unrelated to the transactions contemplated by the Indenture Trustee
Documents in the Commonwealth of Massachusetts. We express no opinion as to
whether or not any fees, taxes or other charges are now or hereafter may be
payable by the Original Loan Participants or the Owner Participant to the
Commonwealth of Massachusetts or any political subdivision thereof in
connection with (a) the execution, delivery, or performance by any of the
Indenture, the Participation Agreement or any of the other Operative
Agreements and (b) the making by the Owner Participant of its investment in
the Aircraft.
7. To the best of our knowledge, there are no pending or threatened
actions or proceedings against State Street before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of State Street, individually or
as Indenture Trustee, to perform its obligations under the Indenture Trustee
Documents.
We rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(4)
[Letterhead of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To the Parties Named on Schedule A attached hereto
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 4.01(l)(iv) of
the Participation Agreement (Federal Express Corporation Trust No. N662FE),
dated as of September 1, 1996, as amended and restated as of October 15, 1996
(the "Participation Agreement") among Federal Express Corporation, as lessee
(the "Lessee"), PMCC Leasing Corporation, as owner participant (the "Owner
Participant"), ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as original loan
participants (the "Original Loan Participants"), First Security Bank, National
Association, as owner trustee (the "Owner Trustee"), State Street Bank and
Trust Company, as indenture trustee (the "Indenture Trustee"), and State
Street Bank and Trust Company, as pass through trustee (the "Pass Through
Trustee"), which Participation Agreement amends and restates that certain
Participation Agreement (Federal Express Corporation Trust No. N662FE), dated
as of September 1, 1996 (the "Original Participation Agreement") among the
Lessee, the Owner Participant, the Original Loan Participants, the Owner
Trustee and the Indenture Trustee, with respect to that portion of Subtitle
VII of Title 49 of the United States Code relative to the recordation of
instruments and the registration of aircraft thereunder.
The capitalized terms herein shall, unless otherwise defined, have
the same meanings given them in the Participation Agreement or in Annex I
attached hereto.
We have examined and filed on this date with the Federal Aviation
Administration (the "FAA") the following described instruments at the
respective times listed below:
(a) Trust Agreement (Federal Express Corporation Trust No. N662FE)
dated as of September 1, 1996, as amended and restated as of
October 15, 1996 (the "Trust Agreement") between the Owner
Participant and the Owner Trustee, which Trust Agreement amends
and restates the Original Trust Agreement, which Trust Agreement
was filed at ____ _.m., C._.T.;
(b) Trust Indenture and Security Agreement (Federal Express
Corporation Trust No. N662FE) dated as of September 1, 1996, as
amended and restated as of October 15, 1996 (the "Indenture")
between the Owner Trustee and the Indenture Trustee, which
Indenture amends and restates the Original Indenture, which
Indenture was filed at ____ _.m., C._.T.; and,
(c) Lease Agreement (Federal Express Corporation Trust No. N662FE)
dated as of September 1, 1996, as amended and restated as of
October 15, 1996 (the "Lease") between the Owner Trustee, as
lessor, and the Lessee, as lessee, which Lease amends and
restates the Original Lease, with the Indenture attached
thereto, which Lease with the Indenture attached was filed at
____ _.m., C._.T.
The Confidential Omissions were intentionally omitted from the FAA
filing counterparts of the Lease and the Indenture as containing confidential
financial information.
Based upon our examination of the above described instruments and of
such records of the FAA as we deemed necessary to render this opinion, it is
our opinion that:
1. AC Form 8050-2 Aircraft ▇▇▇▇ of Sale dated September 23, 1996 (the
"FAA ▇▇▇▇ of Sale") from AVSA S.A.R.L., as seller, conveying title to
the Airframe to the Owner Trustee has been duly recorded by the FAA
on September 23, 1996 and assigned Conveyance No. 2A270087;
2. the Indenture and the Lease with the Indenture attached are in due
form for recordation by and have been duly filed for recordation with
the FAA pursuant to and in accordance with the provisions of 49
U.S.C. Section 44107;
3. the Trust Agreement is in due form for filing and has been duly filed
with the FAA pursuant to and in accordance with the provisions of 49
U.S.C. Section 44103(a);
4. the Original Trust Agreement was duly filed with the FAA on September
23, 1996 pursuant to and in accordance with the provisions of 49
U.S.C. Section 44103(a);
5. the Original Indenture with the Indenture and Security Agreement
Supplement attached has been duly filed with and duly recorded by the
FAA pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44107;
6. the Original Lease with the Lease Supplement, the Original Indenture
and the Indenture and Security Agreement Supplement attached was duly
filed with and duly recorded by the FAA pursuant to and in accordance
with the provisions of 49 U.S.C. Section 44107;
7. the Airframe is duly registered in the name of the Owner Trustee
pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44103(a);
8. the Owner Trustee has valid legal title to the Airframe and the
Aircraft is free and clear of all Liens, except (i) the security
interest created by the Original Indenture, as amended and restated
by the Indenture, as supplemented by the Indenture and Security
Agreement Supplement, and (ii) the rights of the parties under the
Original Lease, as amended and restated by the Lease, as supplemented
by the Lease Supplement;
9. the Original Indenture, as amended and restated by the Indenture, as
supplemented by the Indenture and Security Agreement Supplement,
constitutes a duly perfected first priority security interest in the
Aircraft and a duly perfected first assignment of all the right,
title and interest of the Owner Trustee in, to and under the Original
Lease, as amended and restated by the Lease, as supplemented by the
Lease Supplement (insofar as such assignment affects an interest
covered by the recording system established by the FAA pursuant to 49
U.S.C. Section 44107), and no other registration of the Airframe or
filings other than filings with the FAA (which have been duly
effected) are necessary in order to perfect in any applicable
jurisdiction in the United States (A) the Owner Trustee's title to
the Airframe or (B) such security interest and assignment (insofar as
such assignment affects an interest covered by the recording system
established by the FAA pursuant to 49 U.S.C. Section 44107), it being
understood that no opinion is herein expressed as to the validity,
priority or enforceability of such security interest and assignment
under local law or as to the recognition of the perfection of such
security interest and assignment as against third parties in any
legal proceeding outside the United States;
10. no authorization, approval, consent, license or order of, or
registration with, or the giving of notice to, the FAA is required
for the valid authorization, delivery and performance of the Original
Lease, as amended and restated by the Lease, as supplemented by the
Lease Supplement, the Original Indenture, as amended and restated by
the Indenture, as supplemented by the Indenture and Security
Agreement Supplement, or the Original Trust Agreement, as amended and
restated by the Trust Agreement, except for such filings as are
referred to in our opinion dated September 23, 1996 (which have been
duly effected) and the filings referred to in clauses (a), (b) and
(c) above; and,
11. neither the authorization, issuance and delivery of the Certificates,
the execution and delivery by the parties thereto of the Original
Trust Agreement, the Trust Agreement, the Original Indenture, the
Indenture, the Indenture and Security Agreement Supplement, the
Original Participation Agreement, the Participation Agreement, the
FAA ▇▇▇▇ of Sale, the Original Lease, the Lease and the Lease
Supplement or the performance by the parties thereto of: (i) the
Original Trust Agreement, as amended and restated by the Trust
Agreement; (ii) the Original Indenture, as amended and restated by
the Indenture, as supplemented by the Indenture and Security Agreement
Supplement; (iii) the Original Participation Agreement, as amended and
restated by the Participation Agreement; and (iv) the Original Lease,
as amended and restated by the Lease, as supplemented by the Lease
Supplement, in accordance with the provisions thereof, nor the
consummation by the parties thereto of any of the transactions
contemplated thereby, requires the consent or approval of, or the
giving of notice to, or the registration with, or the taking of any
other action in respect of, the FAA except for the filings, the
recordations and the filings for recordations specified elsewhere in
this opinion.
No opinion is expressed as to the Airframe during any period or
periods of time during which it has not been subject to United States
registration.
No opinion is expressed as to laws other than Federal laws of the
United States. In rendering this opinion, we were subject to the accuracy of
the FAA, its employees and agents, in the filing, indexing and recording of
instruments filed with the FAA and in the search for encumbrance
cross-reference index cards for the Engines. Further, in rendering this
opinion we are assuming the validity and enforceability of the above described
instruments under local law. Since our examination was limited to records
maintained by the FAA, our opinion does not cover liens which are perfected
without the filing of notice thereof with the FAA, such as federal tax liens,
liens arising under 29 U.S.C. Section 1368(a), possessory artisan's liens, or
matters of which the parties have actual notice. In rendering this opinion we
are assuming that there are no documents with respect to the Aircraft which
have been filed for recording under the recording system of the FAA but have
not yet been listed in the available records of such system as having been so
filed.
In rendering this opinion we have relied upon the opinion of the
Assistant Chief Counsel of the Aeronautical Center dated October ___, 1996 and
have continued to rely upon the opinion of the Assistant Chief Counsel of the
Aeronautical Center dated September 18, 1996, copies of which are attached
hereto.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
For the Firm
Annex I
Certain Definitions
Airframe, Engines and Aircraft
One (1) Airbus Industrie A300F4-605R aircraft bearing manufacturer's
serial number 761 and U.S. Registration No. N662FE (the "Airframe") and two
(2) General Electric CF6-80C2-A5F aircraft engines bearing manufacturer's
serial numbers 705-246 and 705-247 (the "Engines") (the Airframe and the
Engines are referred to collectively as the "Aircraft").
Original Trust Agreement
Trust Agreement (Federal Express Corporation Trust No. N662FE) dated
as of September 1, 1996 between PMCC Leasing Corporation, as owner
participant, and First Security Bank, National Association, as owner trustee,
which was filed with the FAA on September 23, 1996.
Original Indenture
Trust Indenture, Mortgage and Security Agreement (Federal Express
Corporation Trust No. N662FE) dated as of September 1, 1996 between First
Security Bank, National Association, as owner trustee, and State Street Bank
and Trust Company, as indenture trustee, which together with the Indenture and
Security Agreement Supplement (as hereinafter defined) attached thereto was
recorded as one instrument by the FAA on September 25, 1996 and assigned
Conveyance No. 2A270116.
Indenture and Security Agreement Supplement
Indenture and Security Agreement Supplement No. 1 (Federal Express
Corporation Trust No. N662FE) dated September 23, 1996 between First Security
Bank, National Association, as owner trustee, and State Street Bank and Trust
Company, as indenture trustee, with respect to the Aircraft, which was
attached to and recorded by the FAA as one instrument with the Original
Indenture.
Original Lease
Lease Agreement (Federal Express Corporation Trust No. N662FE) dated
as of September 1, 1996 between First Security Bank, National Association, as
owner trustee, as lessor, and Federal Express Corporation, as lessee, which
together with the Lease Supplement (as hereinafter defined), the Original
Indenture and the Indenture and Security Agreement Supplement attached thereto
was recorded as one instrument by the FAA on September 25, 1996 and assigned
Conveyance No. 2A270117.
Lease Supplement
Lease Supplement ▇▇. ▇ (▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇)
dated September 23, 1996 between First Security Bank, National Association, as
owner trustee, as lessor, and Federal Express Corporation, as lessee, with
respect to the Aircraft, which was attached to and recorded by the FAA as one
instrument with the Original Lease.
Confidential Omissions
The Lease was filed with the FAA, with (i) Basic Rent (Schedule II),
(ii) the Stipulated Loss Values (Schedule III), (iii) the Termination Values
(Schedule IV), (iv) the Additional Purchase Option Schedule (Schedule V)
omitted from the FAA filing counterpart thereof as containing confidential
financial information; and (v) the purchase price under Section 4.02(a)(F) of
the Lease set forth in Ancillary Agreement II, which was not attached to the
FAA filing counterpart of the Lease or otherwise filed with the FAA for
recordation.
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(5)
[Letterhead of Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
We have acted as special counsel to First Security Bank, National
Association, a national banking association ("First Security"), in connection
with the Trust Agreement (Federal Express Corporation Trust No. N662FE), dated
as of September 1, 1996, as amended and restated as of October 15, 1996 (the
"Trust Agreement"), between First Security and PMCC Leasing Corporation, a
Delaware corporation (the "Owner Participant"). Pursuant to the Participation
Agreement (Federal Express Corporation Trust No. N662FE), dated as of
September 1, 1996, as amended and restated as of October 15, 1996 (the
"Participation Agreement"), among Federal Express Corporation, as Lessee, the
Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants, First Security, not in its individual capacity except as
otherwise expressly set forth therein but solely as Owner Trustee (the "Owner
Trustee") under the Trust Agreement, State Street Bank and Trust Company, as
Indenture Trustee and State Street Bank and Trust Company, as Pass Through
Trustee, one Airbus A300F4-605R aircraft bearing U.S. Registration No. N662FE
(the "Aircraft") is being refinanced. This opinion is furnished pursuant to
Section 4.01(l)(vii) of the Participation Agreement. Capitalized terms used
herein and not otherwise defined are used as defined in the Participation
Agreement, except that references herein to any instrument shall mean such
instrument as in effect on the date hereof.
We have examined executed counterparts or copies otherwise identified
to our satisfaction of the following documents:
(a) The Participation Agreement;
(b) The Trust Agreement;
(c) The Indenture;
(d) The Indenture and Security Agreement Supplement No. 1 dated
September 23, 1996;
(e) The Lease;
(f) The Ancillary Agreement I;
(g) The Ancillary Agreement II:
(h) The Lease Supplement dated September 23, 1996 (each of the
documents identified in paragraphs (a) through (h) being
collectively referred to as the "Owner Trustee Documents"); and
(h) The Certificates being issued today (the "Certificates").
We have also examined originals or copies of such other documents,
such corporate records, certificates and other statements of governmental
officials and corporate officers and other representatives of the corporations
or entities referred to herein and such other instruments as we have deemed
necessary or appropriate for the purposes of this opinion. Moreover, as to
certain facts material to the opinions expressed herein, we have relied upon
representations and warranties contained in the Owner Trustee Documents.
Based upon the foregoing and upon an examination of such questions of
law as we have considered necessary or appropriate, and subject to the
assumptions, exceptions and qualifications set forth below, we advise you
that, in our opinion:
1. First Security is a national banking association duly organized
and validly existing under the laws of the United States of America holding
a valid certificate to do business as a national banking association, with
banking and trust powers, is a Citizen of the United States within the
meaning of Section 40102(a)(15) of the Transportation Code, and each of
First Security and the Owner Trustee, as the case may be, has or had, on
the date of execution thereof, full corporate power, authority and legal
right to execute, deliver and perform each of the Owner Trustee Documents
to which it is or is to be a party and to issue, execute, deliver and
perform the Certificates.
2. Each of First Security and the Owner Trustee, as the case may be,
has duly authorized, executed and delivered each Owner Trustee Document to
which it is a party; each such document constitutes a legal, valid and
binding obligation of the Owner Trustee (and, to the extent set forth in
the respective Owner Trustee Document, of First Security) enforceable
against the Owner Trustee (and, to the extent set forth in the respective
Owner Trustee Document, against First Security) in accordance with its
terms; and assuming the Trust Agreement was properly authorized, executed
and delivered by the Owner Participant and that the terms of the Trust
Agreement are not in violation of any laws, documents, judgments,
regulations or other provisions applicable to the Owner Participant, the
Trust Agreement constitutes, under the laws of the State of Utah, a legal,
valid and binding obligation of the Owner Participant enforceable against
the Owner Participant in accordance with its terms. The Certificates have
been duly issued, executed and delivered by the Owner Trustee, pursuant to
authorization contained in the Trust Agreement, and constitute the legal,
valid and binding obligations of the Owner Trustee enforceable against the
Owner Trustee in accordance with their terms and the terms of the
Indenture; and the Certificates are entitled to the benefits and security
afforded by the Indenture in accordance with their terms and the terms of
the Indenture.
3. On the Delivery Date, the Owner Trustee received from AVSA such
title to the Aircraft as AVSA conveyed to the Owner Trustee, subject to the
rights of the Owner Trustee and the Lessee under the Original Lease and the
security interest created pursuant to the Original Indenture and the
Indenture Supplement; and to our knowledge, there exist no Liens affecting
the title of the Owner Trustee to the Lessor's Estate resulting from claims
against First Security not related to the ownership of the Lessor's Estate
or the administration of the Lessor's Estate or any other transaction
pursuant to the Indenture or any document included in the Trust Indenture
Estate.
4. Under the laws of the State of Utah, all of the properties which
are part of the Trust Indenture Estate have been pledged and mortgaged with
the Indenture Trustee as part of the Trust Indenture Estate and the
beneficial interest of the Owner Participant under the Trust Agreement in
and to such properties is subject, to the extent provided in the Indenture,
to the Lien of the Indenture in favor of the holders of the Certificates
issued and to be issued under the Indenture.
5. To the extent that the Uniform Commercial Code of the State of
Utah (the "UCC") is applicable, except for the Indenture Trustee's taking
possession of all monies and securities (including instruments)
constituting part of the Trust Indenture Estate, no action, including the
filing or recording of any document, is necessary (i) to create under the
UCC the security interest in the Trust Indenture Estate (including the
grant and assignment unto the Indenture Trustee of the security interest in
all estate, right, title and interest of the Owner Trustee in, to and under
the Lease, the Lease Supplement and the Participation Agreement), which
the Indenture by its terms purports to create in favor of the Indenture
Trustee, and (ii) to perfect in the State of Utah such security
interest, except for the filing of a UCC financing statement complying
with the formal requisites of Section 9-402 of the UCC in the office of
the Division of Corporations and Commercial Code of the State of Utah
with respect to the security interest, which filing has been duly
effected, and the filing of continuation statements with respect thereto
required to be filed at periodic intervals under the UCC.
6. The Trust Agreement duly creates a legal and valid trust under
Utah law, the trust created by the Trust Agreement has been duly created
and exists for the benefit of the Owner Participant, and the Trust
Agreement creates for the benefit of the Owner Participant the interest in
the properties referred to in Section 1.02 of the Trust Agreement which the
Trust Agreement by its terms purports to create, which interest is subject
and subordinate to the security interests created by the Indenture to the
extent provided in the Indenture.
7. Neither the authorization, execution and delivery by the Owner
Trustee or First Security, as the case may be, of the Owner Trustee
Documents, nor the issuance, execution and delivery by the Owner Trustee of
the Certificates nor the fulfillment or compliance by the Owner Trustee or
First Security with the respective terms and provisions thereof nor the
consummation of any of the transactions by the Owner Trustee or First
Security, as the case may be, contemplated thereby requires the consent or
approval of, the giving of notice to, the registration with, or the taking
of any other action in respect of, any court or administrative or
governmental authority or agency of the State of Utah or the United States
of America governing the banking or trust powers of First Security.
8. Assuming that (i) the Aircraft is not used in Utah and is not
physically located in Utah at the commencement or termination of the Term
or during such Term, (ii) in connection with any sale of the Aircraft, such
Aircraft will not be physically delivered in Utah to a buyer nor be shipped
from a point within Utah to a buyer, and (iii) the trust created by the
Trust Agreement is treated as a grantor trust for federal income tax
purposes within the contemplation of Sections 671 through 678 of the
Internal Revenue Code of 1986, there are no fees, taxes, or other charges
(except taxes imposed on fees payable to the Owner Trustee) payable to the
State of Utah or any political subdivision thereof in connection with the
execution, delivery or performance by the Owner Trustee, the Indenture
Trustee, the Lessee or the Owner Participant, as the case may be, of the
Owner Trustee Documents or in connection with the making by the Owner
Participant of its investment in the Aircraft or its acquisition of the
beneficial interest in the Lessor's Estate or in connection with the
issuance and acquisition of the Certificates, and neither the Owner
Trustee, the Lessor's Estate nor the trust created by the Trust Agreement
will be subject to any fee, tax or other governmental charge (except taxes
on fees payable to the Owner Trustee) under the laws of the State of Utah
or any political subdivision thereof on, based on or measured by, directly
or indirectly, the gross receipts, net income or value of the Lessor's
Estate solely by reason of the creation or continued existence of the trust
under the terms of the Trust Agreement pursuant to the laws of the State of
Utah or the Owner Trustee's performance of its duties under the Trust
Agreement.
9. The execution, delivery and performance by the Owner Trustee or
First Security, as the case may be, of each of the Owner Trustee Documents
and the issuance, execution, delivery and performance of the Certificates
by the Owner Trustee are not or were not, on the date of execution thereof,
in violation of the charter or by-laws of First Security or of any law,
governmental rule, or regulation of the State of Utah or the United States
of America governing the banking or trust powers of First Security or, to
our knowledge, of any indenture, mortgage, bank credit agreement, note or
bond purchase agreement, long-term lease, license or other agreement or
instrument to which it is a party or by which it is bound or, to our
knowledge, of any judgment or order of the State of Utah or the United
States of America relating to the banking or trust powers of First Security.
10. There is no fee, tax or other governmental charge under the laws
of the State of Utah or any political subdivision thereof in existence on
the date hereof on, based on or measured by any payments under the
Certificates or the beneficial interests in the Lessor's Estate, by reason
of the creation of the trust under the Trust Agreement, pursuant to the
laws of the State of Utah or the Owner Trustee's performance of its duties
under the Trust Agreement, within the State of Utah, which would not have
been imposed if First Security did not have its principal place of business
and did not perform its obligations under the Owner Trustee Documents in
the State of Utah.
11. Neither a Utah court nor a federal court applying federal law or
Utah law, if properly presented with the issue and after having properly
considered such issue, would permit the Owner Participant to terminate the
Trust Agreement, except in accordance with its terms or with the consent of
the Indenture Trustee, as long as the Lien of the Indenture on the Trust
Estate has not been released or payment of the principal of, and Make-Whole
Premium, if any, and interest on, the Certificates have not been made in
full.
12. Although there is no Utah case directly on point, under the
laws of the State of Utah, so long as the Trust Agreement has not been
terminated in accordance with its terms or with the consent of the
Indenture Trustee, creditors of any person that is an Owner Participant,
holders of a lien against the assets of any such person, such as
trustees, receivers or liquidators (whether or not any insolvency
proceeding has been commenced) (collectively, the "Creditors") may
acquire valid claims and liens, as to the Trust Estate, only against the
rights of such Owner Participant under the Trust Agreement or in the
Trust Estate, and do not have, and may not through the enforcement of
such Creditor's rights acquire, any greater rights than such Owner
Participant with respect to the Trust Agreement or the Trust Estate.
13. There are no actions, suits, investigations or proceedings
pending or, to our knowledge, threatened against or affecting First
Security or the Owner Trustee, as the case may be, or any of its properties
in any court or before any administrative agency or arbitrator, which, if
adversely determined, would materially adversely affect the ability of
First Security or the Owner Trustee, as the case may be, to perform its
obligations under any of the Owner Trustee Documents, and there are no
pending or, to our knowledge, threatened actions or proceedings before any
court, administrative agency or tribunal involving First Security or the
Owner Trustee, as the case may be, in connection with the transactions
contemplated by any of the Owner Trustee Documents.
The foregoing opinions are subject to the following assumptions,
exceptions and qualifications:
A. The foregoing opinions are limited to the laws of the State of
Utah and the federal laws of the United States of America governing the
banking and trust powers of First Security and Title II of the United States
Code entitled "Bankruptcy". In addition, we express no opinion with respect
to (i) federal securities laws, including the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, and the Trust
Indenture Act of 1939, as amended, (ii) the Federal Aviation Act of 1958, as
amended (except with respect to the opinion set forth in paragraph 1 above
concerning the citizenship of First Security) and (iii) state securities or
blue sky laws. Insofar as the foregoing opinions relate to the validity
and enforceability in the State of Utah of the Certificates and the other
Owner Trustee Documents expressed to be governed by the laws of the State
of New York, we have assumed that the laws of New York are identical to the
laws of Utah in all material respects, and that the Certificates and such
other Owner Trustee Documents constitute legal, valid, binding and
enforceable documents or instruments under such laws (as to which we
express no opinion). No opinion is expressed as to the priority of any
security interest or as to title to any part of the Trust Estate.
B. The foregoing opinions regarding enforceability of any document or
instrument, except for the opinions set forth in paragraphs 11 and 12 above,
are subject to (i) applicable bankruptcy, insolvency, moratorium,
reorganization, receivership and similar laws affecting the rights and
remedies of creditors generally, and (ii) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
C. We have assumed the due authorization, execution and delivery by
each of the parties thereto, other than First Security and the Owner Trustee,
of the Owner Trustee Documents to which each is a party and that each of such
parties has the full power, authority and legal right to execute and deliver
each such document.
D. The opinion set forth in paragraph 1 above concerning the
citizenship of First Security is based upon the facts contained in an
affidavit of First Security, made by its Vice President, the facts set forth
in which we have not independently verified.
E. We have assumed the due authentication of the Certificates by the
Indenture Trustee.
F. We have assumed that all signatures (other than those of the Owner
Trustee or First Security) on documents and instruments examined by us are
genuine, that all documents and instruments submitted to us as originals are
authentic, and that all documents and instruments submitted to us as copies
conform with the originals, which facts we have not independently verified.
G. We do not purport to be experts in respect of, or express any
opinion concerning, aviation law or other laws, rules or regulations
applicable to the particular nature of the equipment acquired by the Owner
Trustee.
H. We have made no investigation of, and we express no opinion
concerning, the nature of the title to any part of the Lessor's Estate or the
priority of any mortgage or security interest.
I. We have assumed that the Participation Agreement and the
transactions contemplated thereby are not within the prohibitions of Section
406 of the Employee Retirement Income Security Act of 1974.
This opinion is rendered solely for your benefit and may not be
relied upon by any other person or entity for any purpose without our prior
written consent, except that the law firm of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ may rely on
this opinion in connection with the rendering of its opinion dated the date
hereof in connection with the financing described herein.
We rendered an opinion dated September 23, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(6)
[Letterhead of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇]
[Refunding Date]
To the Parties Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N662FE
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company, a Massachusetts trust company, individually ("State Street"), and as
Pass Through Trustee (the "Pass Through Trustee") with respect to the Pass
Through Trust Agreement dated as of June 1, 1996 (the "Pass Through Trust
Agreement"), as supplemented by the Series Supplements dated the date hereof
between Federal Express Corporation and the Pass Through Trustee, designated
as Series Supplement 1996-B1 and 1996-B2, respectively (the "Series
Supplements") and in connection with the transactions contemplated by that
certain Participation Agreement (Federal Express Corporation Trust No.
N662FE), dated as of September 1, 1996, as amended and restated as of October
15, 1996 (the "Participation Agreement") among Federal Express Corporation, as
Lessee (the "Lessee"); PMCC Leasing Corporation, as Owner Participant (the
"Owner Participant"); ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of
America National Trust & Savings Association, The Chase Manhattan Bank,
Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants; First Security Bank, National Association, a national banking
association, not in its individual capacity but solely as Owner Trustee under
the Trust Agreement; State Street, not in its individual capacity but solely
as Indenture Trustee under the Indenture; and State Street, not in its
individual capacity, except as otherwise stated therein, but solely as Pass
Through Trustee. This opinion is being delivered pursuant to Section
4.01(l)(ix) of the Participation Agreement. Except as otherwise defined
herein, all capitalized terms used herein shall have the respective meanings
set forth in Schedule II to the Participation Agreement.
Our representation of State Street has been as special counsel for the
purposes stated above. As to all matters of fact (including factual
conclusions and characterizations and descriptions of purpose, intention or
other state of mind), we have relied entirely upon (i) the representations of
the parties set forth in the Operative Agreements and (ii) the certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations and certificates.
We have examined each Operative Agreement to which State Street or the
Pass Through Trustee, as the case may be, is a party, the Pass Through Trust
Agreement and the Series Supplements (collectively, the "Pass Through Trustee
Documents"), the Certificate of the Massachusetts Commissioner of Banks
relating to State Street and originals, or copies certified or otherwise
identified to our satisfaction, of such other documents, corporate records,
certificates, or other instruments as we have deemed necessary or advisable
for the purposes of this opinion.
We have assumed the genuineness of all signatures (other than those on
behalf of State Street and the Pass Through Trustee), the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form
and the legal competence of each individual executing any document (other than
on behalf of State Street and the Pass Through Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we are
aware or which are known to us, or with another similar qualification, the
relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion, the
individual lawyers in the firm who have participated directly in the specific
transactions to which this opinion relates or in the preparation of this
opinion and the partner of the firm responsible for State Street corporate
trust matters, and without any special or additional investigation undertaken
for the purposes of this opinion.
Each opinion set forth below relating to the enforceability of any
agreement or instrument against State Street and the Pass Through Trustee, as
applicable, is subject to the following general qualifications:
(i) as to any Pass Through Trustee Document, we assume that such agreement
is the legal, valid and binding obligation of each other party thereto;
(ii) the enforceability of any obligation of State Street and the Pass
Through Trustee may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, marshalling or other similar laws and
rules of law affecting the enforcement of rights and remedies (including such
as may deny giving effect to waivers of debtors' or guarantors' rights) of
creditors generally; and
(iii) the enforcement of any rights and availability of any specific or
equitable relief may in all cases by subject to an implied duty of good faith
and to general principals of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
Subject to the limitations set forth herein, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions expressed herein are limited solely to the internal
substantive laws of the Commonwealth of Massachusetts and the Federal laws of
the United States of America. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
other than our opinion expressed in Paragraph 1 hereof with respect to the
citizenship of State Street, no opinion is expressed as to matters governed by
the Transportation Code or by any other law, statute, rule or regulation of
the United States relating to the acquisition, ownership, registration, use,
operation, maintenance, repair, replacement or sale of or the nature of the
Aircraft, Airframe or the Engines.
With your permission and without investigation, with respect to
paragraph 4 below in connection with our opinion relating to the legality,
validity, binding effect and enforceability of the documents there referred
to, to the extent that the laws of the Commonwealth of Massachusetts do not
govern such documents, we have assumed that the laws of the jurisdiction whose
laws govern such documents are not materially different from the internal
substantive laws of the Commonwealth of Massachusetts.
In rendering the opinion set forth below in paragraph 6 as to certain
Massachusetts tax matters, we have assumed that, for Federal income tax
purposes, the trusts created by the Series Supplements are not classified as
associations taxable as corporations and that the trusts created by the Series
Supplements are grantor trusts under subpart E, Part I of Subchapter J of
Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their respective successors and assigns in
connection with the transactions contemplated by the Operative Agreements and
may not be used or relied upon by any other person or for any other purpose.
Based upon the foregoing, we are of the opinion that:
1. State Street is a Massachusetts trust company, duly organized
and validly existing in good standing with the Massachusetts Commissioner of
Banks under the laws of the Commonwealth of Massachusetts, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has the full corporate power and authority to
execute, deliver and perform its obligations under the Pass Through Trustee
Documents and, in its capacity as Pass Through Trustee, to authenticate the
Pass Through Certificates delivered on the Refunding Date.
2. The execution and delivery of the Pass Through Trustee Documents
(other than the Pass Through Trust Agreement) by State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, and
compliance by State Street or the Pass Through Trustee, as the case may be,
individually or as Pass Through Trustee, with all of the provisions thereof do
not and will not contravene any Massachusetts or Federal law, rule or
regulation governing the banking or trust powers of State Street or the Pass
Through Trustee, or any order or judgment known to us, of any Massachusetts or
Federal court or governmental authority applicable to or binding on State
Street, individually or as Pass Through Trustee, or contravene the provisions
of, or constitute a default under, or result in the creation of a Lien on any
property of State Street or the Pass Through Trustee under, its charter
documents or By-Laws or any indenture, mortgage, chattel mortgage, deed of
trust, conditional sales contract, bank loan or credit agreement, in each case
known to us, or any other agreement or instrument, in each case known to us,
to which State Street, individually or as Pass Through Trustee, is a party or
by which it or any of its property may be bound or affected, other than the
Lien of the Indenture.
3. No order, license, consent, permit, authorization or approval
of or exemption by, and no notice to or filing with, or the taking of any
other action in respect of, any Massachusetts or Federal governmental
authority governing the banking or trust powers of State Street or the Pass
Through Trustee, and no filing, recording, publication or registration in any
public office is required under Massachusetts or Federal law pertaining to its
banking or trust powers for the due execution, delivery or performance by
State Street, individually or as Pass Through Trustee, as the case may be, of
the Pass Through Trustee Documents (other than the Pass Through Trust
Agreement) and of the certificate of authentication, as Pass Through Trustee,
on the Pass Through Certificates, or for the legality, validity, binding
effect or enforceability thereof against State Street or the Pass Through
Trustee, as the case may be.
4. Each of the Pass Through Trustee Documents (other than the Pass
Through Trust Agreement) has been duly authorized, executed and delivered by
State Street, in its individual capacity or as Pass Through Trustee, as the
case may be, and each such document constitutes a legal, valid and binding
obligation of State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, enforceable against State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, in
accordance with its terms.
5. The Pass Through Certificates have been duly authorized and
validly executed, issued, delivered and authenticated by the Pass Through
Trustee pursuant to the Pass Through Trust Agreement and the Series
Supplements; and the Pass Through Certificates are enforceable against the
Pass Through Trustee and the holders thereof are entitled to the benefits of
the Pass Through Trust Agreement and the related Series Supplements.
6. There are no fees, taxes or other governmental charges ("Taxes")
payable under the laws of the Commonwealth of Massachusetts with respect to the
execution and delivery by State Street, in its individual capacity or as Pass
Through Trustee, as the case may be, of any of the Pass Through Trustee
Documents (except for Taxes on any fees payable to State Street in its
individual capacity) which would not have been imposed if State Street did not
have its principal place of business in Massachusetts or did not perform its
administrative duties under the Pass Through Trustee Documents in
Massachusetts. Neither State Street, in its individual capacity or as the
Pass Through Trustee, as the case may be, the Owner Participant, the Owner
Trustee, nor the trusts created by the Series Supplements will, as a result of
the transactions contemplated thereby, be subject to any Taxes under the laws
of the Commonwealth of Massachusetts or any political subdivision thereof
(except for Taxes on any fees payable to State Street in its individual
capacity) which would not have been imposed if State Street did not have its
principal place of business in Massachusetts or did not perform its
administrative duties under the Pass Through Trustee Documents in
Massachusetts, and there are no Taxes under the laws of the Commonwealth of
Massachusetts or any political subdivision thereof (except for Taxes on any
fees payable to State Street in its individual capacity) upon or with respect
to the Aircraft or any Engine or any part of any interest therein, or the
purchase, ownership, delivery, lease, sublease, possession, presence, use,
operation, condition, storage, maintenance, modification, alteration, repair,
sale, return, transfer or other disposition of the Aircraft which would not
have been imposed if State Street did not have its principal place of business
in Massachusetts or did not perform its administrative duties under the Pass
Through Trustee Documents in Massachusetts. We express no opinion as to
whether or not any fees, tax or other charges are now or hereafter may be
payable by the Owner Participant to the Commonwealth of Massachusetts or any
political subdivision thereof in connection with (a) the execution, delivery,
or performance of the Series Supplements, the Participation Agreement or any
of the other Operative Agreements and (b) the making by the Owner Participant
of its investment in the Aircraft.
7. To the best of our knowledge, there are no pending or threatened
actions or proceedings against State Street before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of State Street, individually or
as Pass Through Trustee, to perform its obligations under the Pass Through
Trustee Documents.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT B
[FORM OF LEASE AGREEMENT]
[See Exhibit 4.e]
EXHIBIT C
[FORM OF INDENTURE]
[See Exhibit 4.b.1]
EXHIBIT D
[FORM OF TRUST AGREEMENT]
[See Exhibit 4.d]
EXHIBIT E-1
[FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT]
BENEFICIAL INTEREST TRANSFER AGREEMENT (this "Document"), dated as of
_______ __, ____, between ______________, a ______________ corporation
("Transferor") and ______________, a ______________ corporation ("Transferee").
W I T N E S S E T H :
WHEREAS, the parties hereto desire to effect (a) the transfer by
Transferor to Transferee of all of the rights, title and interest of
Transferor in and to its interest (the "Beneficial Interest") under the Trust
Agreement (Federal Express Corporation Trust No. N662FE), dated as of
September 1, 1996, as amended and restated as of October 15, 1996 (the "Trust
Agreement"), between Transferor and First Security Bank, National Association,
and the Lessor's Estate created thereunder, and all of Transferor's rights and
obligations under the Participation Agreement (Federal Express Corporation
Trust No. N662FE), dated as of September 1, 1996, as amended and restated as
of October 15, 1996 (the "Participation Agreement"), among Federal Express
Corporation, as Lessee, First Security Bank, National Association, as Owner
Trustee, PMCC Leasing Corporation, as Owner Participant, State Street Bank and
Trust Company, as Indenture Trustee, ▇▇▇▇▇▇ Guaranty Trust Company of New
York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as Original Loan Participants and State Street Bank and Trust Company, as Pass
Through Trustee, and under the other Operative Agreements and (b) the
acceptance by Transferee of such transfer and the assumption by Transferee of
such obligations of Transferor thereunder; and
WHEREAS, Section 7.03(d) of the Participation Agreement permits such
transfer and assumption upon satisfaction of certain conditions heretofore or
concurrently herewith being observed;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Participation
Agreement.
2. Transfer. Transferor does hereby sell, convey, assign,
transfer and set over, unto Transferee, as of the Effective Time (as defined
below), all of Transferor's present and future right, title and interest in
and to (a) all of the Beneficial Interest and (b) all of the Owner
Participant's rights and obligations under the Participation Agreement, the
Tax Indemnity Agreement, the Trust Agreement and the other Operative
Agreements and any proceeds therefrom, together with all other documents and
instruments evidencing any of such right, title and interest, except such
rights of Transferor as have arisen or accrued to Transferor prior to the
Effective Time (including without limitation, the right to receive any amounts
due or accrued to Transferor under the Operative Agreements as of a time prior
to the Effective Time and the right to receive any indemnity payment pursuant
to the Participation Agreement or the Tax Indemnity Agreement, with respect to
events occurring prior to such time); all of the foregoing that is being
transferred under this paragraph 2, the "Transferred Interest".
3. Assumption. Transferee hereby accepts the transfer of the
Transferred Interest and, for the benefit of Transferor and the other parties
to the Participation Agreement, assumes and undertakes and agrees to perform
and discharge all of the duties and obligations of Transferor with respect to
the Transferred Interest whenever and wherever accrued (other than duties and
obligations of Transferor required to be performed by it on or prior to the
Effective Time). Transferee hereby confirms that, from and after the
Effective Time, Transferee (a) shall be deemed, to the extent set forth in
Section 2 hereof, the "Owner Participant" party to the Participation
Agreement, the Tax Indemnity Agreement, the Trust Agreement and the other
Operative Agreements and (b) shall be bound by all of the terms of the
Operative Agreements to the extent the same relate to the Transferred Interest.
4. Release of Transferor. At the Effective Time, Transferor shall
be relieved of all of its duties and obligations with respect to the
Transferred Interest under the Operative Agreements, provided, however, that
Transferor shall in no event be released from any such duty or obligations
arising or relating to any event occurring prior to the Effective Time, or on
account of any breach by Transferor of any of its representations, warranties,
covenants or obligations set forth in the Operative Agreements, or for any
fraudulent or willful misconduct engaged in by it prior to the Effective Time,
or from any obligation that relates to any indemnity claimed by Transferor or
any Lessor's Lien attributable to Transferor.
5. Fees and Expenses. The fees, expenses and charges of the
parties to the Participation Agreement incurred in connection with the
transfer effected hereby shall be for the account of [specify
Transferor/Transferee].
6. Payments. Transferor hereby covenants and agrees to pay over to
Transferee, if and when received following the Effective Time, any amounts
(including any sums payable as interest in respect thereof) paid on account of
the Transferred Interest to or for the benefit of Transferor, and Transferee
hereby covenants and agrees to pay over to Transferor, if and when received
following the Effective Time, any amounts (including any sums payable as
interest in respect thereof) paid to or for the benefit of Transferee that are
not attributable to the Transferred Interest and to which Transferor is
otherwise entitled.
7. Investment Purpose. Transferee hereby represents and warrants
that, as of the date hereof, it is acquiring the Transferred Interest for its
account with no present intention of distributing such Transferred Interest
or any part thereof in any manner which would violate the Securities Act of
1933, as amended, but without prejudice, however, to the right of Transferee
at all times to sell or otherwise dispose of all or any part of such
Transferred Interest in compliance with Section 7.03(d) of the
Participation Agreement.
8. Representations and Warranties of Transferor. Transferor
represents and warrants to Transferee that as of the Effective Time:
(a) Organization and Power. Transferor is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and has full corporate power, authority and
legal right to execute, deliver and perform this Agreement and to
enter into and carry out the transactions contemplated hereby and in
the other Operative Agreements (the "Transactions").
(b) Authorization, Execution and Validity. This Agreement has been
duly authorized, executed and delivered by Transferor and constitutes
the legal, valid and binding obligation of Transferor, enforceable
against it in accordance with its terms except as enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and by
general principles of equity.
(c) Conflict. The execution, delivery and performance by
Transferor of this Agreement and compliance by Transferor with all of
the provisions hereof do not contravene any regulation or any order
of any governmental authority applicable to or binding on Transferor,
or contravene the provisions, or constitute a default by Transferor
under, its certificate of incorporation or by-laws or any indenture,
mortgage, contract or other agreement or instrument to which
Transferor is a party or by which Transferor or any of its Properties
is bound or affected.
(d) Consents. No consent, approval or authorization of, or filing,
registration or qualification with, or the giving of notice or the
taking of any other action with respect to, any governmental
authority on the part of Transferor is required in connection with
the execution, delivery and performance by Transferor of this
Agreement.
(e) Litigation. There are no proceedings pending or, to the
knowledge of Transferor, threatened against Transferor before any
governmental authority that would materially and adversely affect the
ability of Transferor to consummate the Transactions.
(f) No Liens. The Trust Estate is free of Lessor's Liens
attributable to Transferor.
(g) Compliance with Operative Agreements. Transferor has fully
performed all of its obligations under the Participation Agreement
and under each other Operative Agreement which obligations by their
terms are required to be satisfied or performed prior to the
Effective Time or prior to the consummation of the Transactions.
(h) Default. As a result of the transfer effected hereby, no
Indenture Default attributable to the Owner Participant or the Owner
Trustee has occurred and is continuing.
Notwithstanding the foregoing or anything else contained in this
Agreement, it makes no representation or warranty in this Agreement
with respect to laws, rules or regulations relating to aviation or to
the nature or use of the equipment owned by the Owner Trustee,
including, without limitation, the airworthiness, value, condition,
workmanship, design, patent or trademark infringement, operation,
merchantability or fitness for use of the Aircraft.
9. Representations and Warranties of Transferee. Transferee
represents and warrants to Transferor and to the other parties to the
Participation Agreement that as of the Effective Time:
(a) Transferee is a corporation duly organized, validly existing
and in good standing under the laws of the State of [ ], has
the full corporate power, authority and legal right to carry on its
business as now conducted, and has full corporate power, authority
and legal right to execute, deliver and perform this Agreement and to
enter into and carry out the transactions contemplated hereby and in
the other Operative Agreements (the "Transactions");
(b) Transferee has full corporate power, authority and legal right
to execute, deliver and enter into this Agreement and the other
Operative Agreements and full corporate power and authority to
perform its obligations thereunder, and such execution, delivery and
performance do not and will not contravene any applicable law or any
order of any governmental authority applicable to or binding on the
Transferee, or contravene the provisions of, or constitute a default
under, or result in the creation of any Lien upon the property of the
Transferee under, its articles of incorporation or by-laws or any
material indenture, mortgage, contract or other agreement or
instrument to which the Transferee is a party or by which it or any
of its property may be bound or affected;
(c) the execution, delivery and performance of this Agreement by the
Transferee (i) has been duly authorized by all necessary corporate
action and (ii) does not require any approval of the shareholders of
the Transferee or any approval or consent of, or notice to, any
trustee or holders of any indebtedness or obligation of the
Transferee, except for such approvals and consents as have already
been obtained;
(d) this Agreement has been duly executed and delivered by the
Transferee, and constitutes the legal, valid and binding obligation
of the Transferee, enforceable against the Transferee in accordance
with its terms, except as the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally and by general principles of equity;
(e) there are no proceedings or actions pending or, to the
knowledge of the Transferee, threatened against the Transferee before
any governmental authority in which there is a reasonable probability
of an adverse determination that individually or in the aggregate
would materially and adversely impair the ability of the Transferee
to perform its obligations under this Agreement or the Operative
Agreements, or which involve the Transactions or question the
validity of any Operative Agreement to which the Owner Participant is
a party or any action taken or to be taken pursuant thereto; and the
Transferee is not in default with respect to any order of any
governmental authority which involves the Transactions or the default
under which would materially and adversely affect the ability of the
Transferee to perform its obligations under this Agreement or any of
the Operative Agreements;
(f) no consent, approval, order or authorization of, giving of
notice to, or registration with, or taking of any other action in
respect of, any governmental authority is required under any law for
the execution and delivery by the Transferee of this Agreement, or
the carrying out by the Transferee of any of the Transactions, other
than any such consent, approval, order, authorization, registration,
notice or action as has been duly obtained, given or taken;
(g) the Lessor's Estate is free of any Lessor's Liens attributable
to the Transferee;
(h) the Transferee, upon execution of this Agreement, will not be
in default under any of the Operative Agreements;
(i) no part of the funds to be used by it to acquire the interests
acquired by the Owner Participant under the Participation Agreement
constitutes assets (within the meaning of ERISA and any applicable
rules and regulations) of any employee benefit plan subject to Title
I of ERISA or of any plan or individual retirement account subject to
Section 4975 of the Code;
(j) Transferee is a "U.S. Person" as defined in Section 7701(a)(30)
of the Code and is not a tax resident of another country and if it
shall at any time cease to be such a "U.S. Person" or shall become a
tax resident of another country, it shall furnish to the Agent and
each Loan Certificate Holder an indemnity, in form and substance
reasonably satisfactory to such Loan Certificate Holder, for any
Taxes that may be imposed on such Holder as a result of its failure
to be such a "U.S. Person" or as a result of its being a tax resident
of another country, and it shall be personally liable for any debt
service to the extent that the receipt of rentals is reduced by
reason of any withholding Taxes that result from such failure to be
such a "U.S. Person" or from being a tax resident of another country;
(k) [After giving effect to a voting trust or similar
agreement(1), Transferee is a Citizen of the United States]
[applicable if Aircraft is registered in the United States or is
proposed to be so registered]
---------------------
(1) Such voting trust or similar agreement must be reasonably
satisfactory to the Lessor and the Indenture Trustee.
(l) On and as of the Effective Date, the representations and
warranties of the Owner Participant in Article 7 of the Participation
Agreement are true and correct as to the Transferee; and
(m) Transferee satisfies the conditions applicable to a transferee
of the Beneficial Interest set forth in Section 7.03(d) of the
Participation Agreement, including without limitation, the condition
set forth in the last sentence thereof [and to the extent the same
has been requested by the Lessee or the Indenture Trustee, Transferee
has heretofore provided to the Lessee and the Indenture Trustee its
most recent audited financial statements, which show a consolidated
tangible net worth or combined capital and surplus of at least
$75,000,000] [remove bracketed language if an Owner Participant
Guaranty is provided].
(n) the Transferee has, independently and without reliance upon any
other party (including without limitation the Transferor) and based
on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement,
and the Transferee has established adequate means of obtaining from
Lessee on a continuing basis information pertaining to, and is now
and on a continuing basis will be completely familiar with, the
financial condition, operations, properties and prospects of Lessee.
Notwithstanding the foregoing or anything else contained in this Agreement, it
makes no representation or warranty in this Agreement with respect to laws,
rules or regulations relating to aviation or to the nature or use of the
equipment owned by the Owner Trustee, including, without limitation, the
airworthiness, value, condition, workmanship, design, patent or trademark
infringement, operation, merchantability or fitness for use of the Aircraft,
other than such laws, rules or regulations relating to the citizenship
requirements of it under applicable aviation law.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
11. Effectiveness. This Agreement shall be effective upon the mutual
execution and delivery of this Agreement (the "Effective Time").
12. Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument. It
shall not be necessary that any counterpart be signed by both parties so long
as each party shall sign at least one counterpart.
13. Beneficiaries. Each of the Owner Trustee, the Indenture Trustee,
the Original Loan Participants and the Lessee, together with their respective
successors and permitted assigns, is and shall be deemed a third party
beneficiary of this Agreement entitled to enforce this Agreement directly and
in its own name and enforce any rights or claims of the parties hereto.
14. Further Assurances. Each party agrees that from time to time
after the Effective Time, it shall execute and deliver or cause to be executed
and delivered such instruments, documents and papers, and take all such
further action as may be reasonably required in order to consummate fully the
purposes of this Agreement and to implement the transactions contemplated
hereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
[TRANSFEROR]
By:____________________________
Name:
Title:
[TRANSFEREE]
By:____________________________
Name:
Title:
EXHIBIT E-2
[FORM OF OWNER PARTICIPANT GUARANTY]
TRANSFEREE'S PARENT GUARANTY, dated as of ___________ __, ____, (this
"Guaranty") by ____________________, a ___________ corporation (the
"Guarantor"), to First Security Bank, National Association, in its individual
capacity and as Owner Trustee, State Street Bank and Trust Company, as
Indenture Trustee, the Original Loan Participants and the Lessee referred to
in the Participation Agreement described below (collectively, together with
their successors and assigns and the holders from time to time of the Loan
Certificates, the "Beneficiaries").
W I T N E S S E T H :
WHEREAS, ___________, a ____________ corporation (the "Transferor"), is
party to the Participation Agreement (Federal Express Corporation Trust No.
N662FE), dated as of September 1, 1996, as amended and restated as of October
15, 1996 (as amended, modified or supplemented from time to time, the
"Participation Agreement"), among Federal Express Corporation, as Lessee, PMCC
Leasing Corporation, as Owner Participant, First Security Bank, National
Association, as Owner Trustee, State Street Bank and Trust Company, as
Indenture Trustee, ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants and State Street Bank and Trust Company, as Pass Through Trustee;
and
WHEREAS, the Transferor wishes to transfer, among other things, all of
the rights, title and interest of the Transferor in and to the Beneficial
Interest under the Trust Agreement and the Lessor's Estate created thereunder,
and all of the Transferor's rights and obligations under the Participation
Agreement, the Trust Agreement and the other Operative Agreements to
__________________, a _______________ [corporation] (together with its
successors and assigns, the "Transferee"), a subsidiary of the Guarantor,
pursuant to the Beneficial Interest Transfer Agreement, dated as of the date
hereof (the "Transfer Agreement"), between the Transferor and the Transferee;
and
WHEREAS, the terms of the Participation Agreement provide that the
aforementioned transfer is conditioned upon the execution and delivery of this
Guaranty by the Guarantor;
NOW, THEREFORE, in order that the Transferor may make the aforementioned
transfer to the Transferee, the Guarantor hereby agrees with and for the
benefit of the Beneficiaries as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the respective meanings assigned thereto in the Participation
Agreement or the Transfer Agreement.
2. Guaranty. The Guarantor hereby unconditionally and irrevocably
guarantees, as primary obligor and not merely surety, to the Beneficiaries the
prompt and complete payment by the Transferee when due of all payment
obligations of the Transferee under the Operative Agreements without offset or
deduction and the timely performance of all other obligations of the
Transferee thereunder (such payment and other obligations, the "Obligations"),
and the Guarantor further agrees to pay any and all expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be paid
or incurred by the Beneficiaries in enforcing any rights with respect to, or
collecting, any or all of the Obligations and/or enforcing any rights with
respect to, or collecting against, the Guarantor under this Guaranty.
The Guarantor will not exercise any rights that it may now or
hereafter acquire against Transferee that arise from the existence, payment,
performance or enforcement of the Guarantor's Obligations under this Guaranty,
the Transferred Interest or the Operative Agreements, including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution
or indemnification and any right to participate in any claim or remedy of any
Beneficiary against Transferee or any collateral, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from Transferee,
directly or indirectly, in cash or other property or by set-off or in any
other manner, payment or security on account of such claim, remedy or right,
unless and until all of the Obligations have been performed in full and all
other amounts payable under this Guaranty shall have been paid in full in
cash. If any amount shall be paid to the Guarantor in violation of the
preceding sentence at any time prior to the final payment in full in cash of
the Obligations and all other amounts payable under this Guaranty, such amount
shall be held in trust for the benefit of any Beneficiary and shall forthwith
be paid to such Beneficiary to be credited and applied to the Obligations and
all other amounts payable under this Guaranty, whether matured or unmatured,
in accordance with the terms of the Operative Agreements, or to be held as
collateral for any Obligations or other amounts payable under this Guaranty
thereafter arising.
3. No Subrogation. Notwithstanding anything to the contrary in
this Guaranty, the Guarantor hereby agrees not to assert any rights which may
have arisen in connection with this Guaranty to be subrogated to any of the
rights (whether contractual, under the Bankruptcy Code, under common law or
otherwise) of any Beneficiary against the Transferee for the payment of the
obligations until all of the Obligations shall have been satisfied by payment
and performance in full.
4. Amendments with Respect to the Obligations; Waiver of Rights.
The Guarantor shall remain fully obligated hereunder notwithstanding that,
without any reservation of rights against the Guarantor and without notice to
or further assent by the Guarantor, any demand for payment or performance of
any of the Obligations made by any Beneficiary may be rescinded by such party
and any of the obligations continued, and the Obligations, may, from time to
time, in whole or part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by any Beneficiary and any
Operative Agreement may be amended, modified, supplemented or terminated, in
whole or in part, in accordance with the provisions thereof from time to time.
When making any demand hereunder against the Guarantor, a Beneficiary may, but
shall be under no obligation to, make a similar demand on the Transferee, and
any failure by a Beneficiary to make any such demand or to collect any
payments from the Transferee or any release of the Transferee shall not
relieve the Guarantor of its obligations or liabilities hereunder, and shall
not impair or affect the rights and remedies, express or implied, or as a
matter of law, of any Beneficiary against the Guarantor. For the purposes
hereof, "demand" shall include the commencement and continuance of any legal
proceedings. The Guarantor represents and warrants that it is the parent of
the Transferee, and agrees that its obligations hereunder shall continue
unimpaired, even if the Guarantor is no longer an Affiliate of the Transferee.
5. Guaranty Absolute and Unconditional. The Guarantor guarantees
that the Obligations will be paid and performed strictly in accordance with
the terms of the Transfer Agreement and the Operative Agreements, regardless
of any law, regulation or order now or hereafter in effect in any jurisdiction
affecting any such terms or the rights of any Beneficiary with respect
thereto. The obligations of the Guarantor under this Guaranty are independent
of the Obligations or any other obligations of any other party, and a separate
action or actions may be brought and prosecuted against the Guarantor to
enforce this Guaranty, irrespective of whether the Transferee or any other
party is joined in any such action or actions. The Guarantor waives any and
all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by any Beneficiary upon this
Guaranty or acceptance of this Guaranty; the Obligations, and any of them,
shall conclusively be deemed to have been created, contracted or incurred, or
renewed, extended, amended or waived, in reliance upon this Guaranty; and all
dealings between the Transferee or the Guarantor and any Beneficiary shall
likewise be conclusively presumed to have been had or consummated in reliance
upon this Guaranty. The Guarantor waives, to the fullest extent permitted by
applicable law, diligence, presentment, promptness, protest, mitigation of
damages by the Beneficiaries demand for payment and notice of default or
nonpayment to or upon the Transferee or the Guarantor with respect to the
Obligations. The Guarantor further waives any right to revoke this Guaranty,
and acknowledges that this Guaranty is continuing in nature and applies to all
Obligations, whether existing now or in the future. The Guarantor understands
and agrees that, to the fullest extent permitted by applicable law, this
Guaranty shall be construed as a continuing, absolute and unconditional
guaranty of payment and performance (and not merely of collectibility) without
regard to:
(a) the validity, regularity or enforceability of the Transfer
Agreement, any Operative Agreement, or any of the Obligations at any
time or from time to time held by any Beneficiary;
(b) any defense, set-off, rebate, adjustment, withholding,
deduction or counterclaim (other than a defense of payment or
performance) that may at any time be available to or be asserted by
the Transferee against any Beneficiary or any agreement or instrument
relating thereto or;
(c) any change in the time, manner or place of payment of, or in
any other term of, all or any of the obligations or any other
obligations of any other party under the Transfer Agreement, the
Operative Agreements, or any other amendment or waiver of or any
consent to departure from the Transfer Agreement or other Operative
Agreements;
(d) any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Obligations;
(e) any change, restructuring or termination of the corporate
structure or existence of the Guarantor or the Transferee or any of
the Affiliates of either;
(f) any defect in the title, condition, design, operation or
fitness of, or any interference with the operation, use or possession
of, the Aircraft;
(g) any failure to establish, perfect or preserve title to or any
security interest in or to the Aircraft or any other collateral
security for the Obligations; or
(h) any other circumstance whatsoever or any existence of or
reliance on any representation by any Beneficiary that might
otherwise constitute a defense available to, or a discharge of, the
Guarantor or any other guarantor or surety.
When pursuing its rights and remedies hereunder against the Guarantor,
any Beneficiary may, but shall be under no obligation to, pursue such rights
and remedies as it may have against the Transferee for the Obligations, and
any failure by any Beneficiary to pursue such other rights or remedies or to
collect any payments from the Transferee, or any release of the Transferee,
shall not, to the fullest extent permitted by applicable law, relieve the
Guarantor of any liability hereunder, and shall not impair or affect the
rights and remedies, whether express, implied or available as a matter of law,
of any Beneficiary against the Guarantor. This Guaranty is a continuing
guaranty and shall remain in full force and effect until the earlier of (x)
the date that all of the Obligations are satisfied by payment and performance
in full and (y) the date that all right, title and interest of the Transferee
shall have been transferred to a Person meeting the requirements of Section
7.03(d) of the Participation Agreement in accordance with said section;
provided that this Guaranty shall remain in full force and effect with respect
to obligations relating to the period prior to such transfer.
6. Reinstatement. This Guaranty shall continue to be effective,
or be reinstated, as the case may be, if at any time payment, or any part
thereof, of any of the Obligations is rescinded or must otherwise be restored
or returned by any Beneficiary upon the insolvency, bankruptcy dissolution,
liquidation or reorganization of the Transferee or the Guarantor, or upon or
as a result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Transferee or the Guarantor or any
substantial part of its property, or otherwise, all as though such payments
had not been made and the Guarantor agrees that it will indemnify any such
Beneficiary on demand for all reasonable costs and expenses (including,
without limitation, reasonable fees and expenses of counsel) by such
Beneficiary in connection with such rescission or restoration.
7. Payments. The Guarantor hereby guarantees that payments
hereunder shall be paid without set-off, counterclaim, deduction, rebate,
adjustment or withholding, and shall be made in U.S. Dollars in immediately
available funds.
8. Representations and Warranties. The Guarantor hereby
represents and warrants that:
(a) the Guarantor is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation and the Transferee is currently a subsidiary of the
Guarantor;
(b) the Guarantor has the power and authority and the legal right
to execute and deliver, and to perform its obligations under, this
Guaranty, and has taken all necessary corporate action to authorize
its execution, delivery and performance of this Guaranty;
(c) this Guaranty constitutes a legal, valid and binding obligation
of the Guarantor enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally;
(d) the execution, delivery and performance of this Guaranty will
not violate any provision of any requirement of law or contractual
obligation of the Guarantor or any of its constitutive documents;
(e) no consent or authorization of, filing with, or other act by or
in respect of, any arbitrator or governmental authority and no
consent of any other person is required in connection with the
execution, delivery, performance, validity or enforceability of this
Guaranty;
(f) the Guarantor is a [a bank, savings institution, finance
company, leasing company or trust company, national banking
association acting for its own account or in a fiduciary capacity as
trustee or agent under any pension, retirement, profit sharing or
similar trust or fund, insurance company, fraternal benefit society
or corporation acting for its own account having a combined capital
and surplus (or, if applicable, consolidated tangible net worth or
its equivalent)] of not less than $75,000,000 [and has, if the same
have been requested by the Lessee or the Indenture Trustee,
heretofore furnished to the Lessee and the Indenture Trustee copies
of its most recent audited financial statements];
(g) there are no conditions precedent to the effectiveness of this
Guaranty that have not been satisfied or waived; and
(h) the Guarantor has, independently and without reliance upon any
Beneficiary and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to
enter into this Guaranty, and the Guarantor has established adequate
means of obtaining from Transferee on a continuing basis information
pertaining to, and is now and on a continuing basis will be
completely familiar with, the financial condition, operations,
properties and prospects of Transferee.
9. Severability. Any provision of this Guaranty that 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.
10. Jurisdiction; Waiver of Jury Trial, Etc.
(a) The Guarantor hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any
New York State court or federal court of the United States of America
sitting in New York, New York, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to
this Guaranty, the Transfer Agreement or any Operative Agreement to
which it is or is to be a party, or for recognition or enforcement
of any judgment, and the Guarantor hereby irrevocably and
unconditionally agrees that all claims in respect of any such action
or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. The
Guarantor agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided
by law. Nothing in this Guaranty shall affect any right that any
party may otherwise have to bring any action or proceeding relating
to this Guaranty, the Transfer Agreement or any Operative Agreement
to which it is or is to be a party in the courts of any jurisdiction.
(b) The Guarantor irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection
that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Guaranty, the
Transfer Agreement or any Operative Agreement to which it is or is to
be a party in any New York State or federal court. The Guarantor
hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
11. Section Headings. The Section headings used in this Guaranty
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
12. No Waiver; Cumulative Remedies. No Beneficiary shall by any act
(except by a written instrument pursuant to Section 13 hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any breach of any of the terms and
conditions hereof. No failure to exercise, nor any delay in exercising, on
the part of any Beneficiary, any right, power or privilege hereunder shall
operate as a waiver thereof. No single or partial exercise of any right,
power or privilege hereunder shall preclude any other or further exercise
thereof or the exercise of any other right power or privilege. A waiver by a
Beneficiary of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy that such Beneficiary would
otherwise have on any future occasion. The rights and remedies herein
provided are cumulative, may be exercised singly or concurrently and are not
exclusive of any rights or remedies provided by law.
13. Amendments and Waivers. None of the terms or provisions of this
Guaranty may be waived, amended or supplemented or otherwise modified except
by a written instrument executed by the Guarantor and each Beneficiary.
14. Successors and Assigns. This Guaranty shall be binding upon the
successors and assigns of the Guarantor and shall inure to the benefit of the
Beneficiaries and their respective successors and permitted assigns but
Guarantor may not assign this Guaranty without prior written consent of the
Beneficiaries except to an assignee making, as of the date of such assignment,
(i) representations and warranties substantially similar to those contained in
Section 8 hereof and (ii) a representation that it is a U.S. citizen, unless,
in the case of the preceding clause (ii) any of (a) the aircraft is not then
registered in the United States nor contemplated to be so registered or (b) a
voting trust or similar arrangement reasonably satisfactory to the
Beneficiaries is in place with respect to such registration or (c) it is not
necessary for the Guarantor to be a U.S. citizen in order for the aircraft to
remain registered in the United States.
15. GOVERNING LAW. THIS GUARANTY SHALL BE GOVERNED BY AND BE
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
16. Notices. All notices, requests and demands to or upon the
Guarantor or any Beneficiary to be effective shall be in writing and, unless
otherwise expressly provided herein, shall be deemed to have been duly given
or made, when delivered by hand or by mail, upon receipt, or, when delivered
by facsimile transmission, upon being sent and confirmed, addressed (a) in the
case of the Guarantor, to the Guarantor at the address set forth under its
signature below, and (b) in the case of any Beneficiary, to such Beneficiary
at the address provided for such Beneficiary in or pursuant to the
Participation Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be duly
executed and delivered by its duly authorized officer as of the day and year
first above written.
[NAME OF GUARANTOR]
_________________________________
Name:
Title:
__________________________________
__________________________________
__________________________________
Address for Notices:
PARTICIPATION AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N667FE)
Dated as of August 1, 1996
Amended and Restated as of October 15, 1996
among
FEDERAL EXPRESS CORPORATION,
Lessee
PMCC LEASING CORPORATION,
Owner Participant
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK
BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSOCIATION
THE CHASE MANHATTAN BANK
COMMERZBANK AG, ATLANTA AGENCY and
NATIONSBANK, N.A. (SOUTH),
Original Loan Participants
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Not in Its Individual Capacity
Except as Otherwise Expressly
Set Forth Herein, but Solely as Owner Trustee,
Owner Trustee
STATE STREET BANK AND TRUST COMPANY,
Indenture Trustee
and
STATE STREET BANK AND TRUST COMPANY,
Pass Through Trustee
______________________________
LEVERAGED LEASE OF ONE AIRBUS A300F4-605R AIRCRAFT
SERIAL NO. 771, REGISTRATION NO. N667FE
TABLE OF CONTENTS
Page
----
Initial Recitals........................................................... 1
ARTICLE 1
DEFINITIONS............................................................. 3
ARTICLE 2
Section 2.01. Transfer of Funds........................................ 3
Section 2.02. Certificates............................................. 6
ARTICLE 3
EXTENT OF INTEREST OF ORIGINAL LOAN PARTICIPANTS
Section 3.01. Extent of Interest of Original Loan Participants......... 6
ARTICLE 4
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent..................................... 7
Section 4.02. Opinion of Special Aviation Counsel...................... 16
ARTICLE 5
CONDITIONS PRECEDENT TO LESSEE'S OBLIGATIONS
Section 5.01. Conditions Precedent to Lessee's Obligations............. 16
ARTICLE 6
LESSEE'S REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 6.01. Lessee's Representations and Warranties.................. 16
Section 6.02. Offering by Lessee....................................... 22
Section 6.03. Certain Covenants of Lessee.............................. 23
Section 6.04. Survival of Representations and Warranties............... 30
ARTICLE 7
OTHER PARTIES' REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Acquisitions and Offerings of Interests in Lessor's
Estate.................................................. 31
Section 7.02. Citizenship.............................................. 31
Section 7.03. Representations, Warranties and Covenants of Owner
Participant............................................. 32
Section 7.04. Representations, Covenants and Warranties of FSB and the
Owner Trustee........................................... 37
Section 7.05. Representations, Warranties and Covenants of the Indenture
Trustee................................................ 40
Section 7.06. Indenture Trustee's Notice of Default.................... 42
Section 7.07. Releases from Indenture.................................. 42
Section 7.08. Covenant of Quiet Enjoyment.............................. 42
Section 7.09. Original Loan Participants' and Pass Through Trustee's
Representations and Warranties.......................... 42
Section 7.10. Survival of Representations, Warranties and Covenants.... 43
Section 7.11. Lessee's Assumption of the Certificates.................. 43
Section 7.12. Indebtedness of Owner Trustee............................ 45
Section 7.13. Compliance with Trust Agreement, Etc..................... 46
ARTICLE 8
TAXES
Section 8.01. Lessee's Obligation to Pay Taxes......................... 46
Section 8.02. After-Tax Basis.......................................... 52
Section 8.03. Time of Payment.......................................... 53
Section 8.04. Contests................................................. 53
Section 8.05. Refunds.................................................. 56
Section 8.06. Lessee's Reports......................................... 56
Section 8.07. Survival of Obligations.................................. 57
Section 8.08. Payment of Taxes......................................... 57
Section 8.09. Reimbursements by Indemnitees Generally.................. 57
Section 8.10. Obligations of Lessee Unsecured.......................... 57
ARTICLE 9
GENERAL INDEMNITY
Section 9.01. Generally................................................ 58
Section 9.02. After-Tax Basis.......................................... 61
Section 9.03. Subrogation.............................................. 62
Section 9.04. Notice and Payment....................................... 62
Section 9.05. Refunds.................................................. 62
Section 9.06. Defense of Claims........................................ 63
Section 9.07. Survival of Obligations.................................. 64
Section 9.08. Effect of Other Indemnities.............................. 64
Section 9.09. Interest................................................. 64
Section 9.10. Obligations of Lessee Unsecured.......................... 65
ARTICLE 10
TRANSACTION COSTS
Section 10.01. Transaction Costs and Other Costs....................... 65
ARTICLE 11
SUCCESSOR OWNER TRUSTEE
Section 11.01. Appointment of Successor Owner Trustee.................. 67
ARTICLE 12
LIABILITIES AND INTERESTS OF THE OWNER PARTICIPANT AND HOLDERS
Section 12.01. Liabilities of the Owner Participant.................... 68
Section 12.02. Interest of Holders of Certificates..................... 69
ARTICLE 13
OTHER DOCUMENTS
Section 13.01. Consent of Lessee to Other Documents.................... 69
Section 13.02. Further Assurances...................................... 69
Section 13.03. No Retroactive Application.............................. 69
Section 13.04. Pass Through Trustee's Acknowledgment................... 70
ARTICLE 14
NOTICES
Section 14.01. Notices................................................. 70
ARTICLE 15
REFINANCING/REOPTIMIZATION
Section 15.01. Refinancing............................................. 71
Section 15.02. Reoptimization.......................................... 74
ARTICLE 16
[INTENTIONALLY LEFT BLANK]
ARTICLE 17
MISCELLANEOUS
Section 17.01. Owner for Federal Tax Purposes.......................... 76
Section 17.02. [Intentionally Left Blank.]............................. 76
Section 17.03. Counterparts............................................ 76
Section 17.04. No Oral Modifications................................... 76
Section 17.05. Captions................................................ 77
Section 17.06. Successors and Assigns.................................. 77
Section 17.07. Concerning the Owner Trustee, Indenture Trustee and
the Pass Through Trustee............................... 77
Section 17.08. Severability............................................ 78
Section 17.09. Public Release of Information........................... 78
Section 17.10. Certain Limitations on Reorganization................... 78
Section 17.11. GOVERNING LAW........................................... 78
Section 17.12. Section 1110 Compliance................................. 79
ARTICLE 18
CONFIDENTIALITY
Section 18.01. Confidentiality......................................... 79
SCHEDULE I Certificate Information
SCHEDULE II Definitions
SCHEDULE III Permitted Country List
EXHIBIT A(1)(a) Opinion of Lessee's Counsel
EXHIBIT A(1)(b) Opinion of Lessee's Special Counsel
EXHIBIT A(2)(a) Opinion of Owner Participant's Special Counsel
EXHIBIT A(2)(b) Opinion of Owner Participant's Counsel
EXHIBIT A(3) Opinion of Indenture Trustee's Special Counsel
EXHIBIT A(4) Opinion of Special Aviation Counsel
EXHIBIT A(5) Opinion of Owner Trustee's Special Counsel
EXHIBIT A(6) Opinion of Pass Through Trustee's Special Counsel
EXHIBIT B Form of Lease Agreement
EXHIBIT C Form of Indenture
EXHIBIT D Form of Trust Agreement
EXHIBIT E-1 Form of Assignment and Assumption Agreement
EXHIBIT E-2 Form of Owner Participant Guaranty
PARTICIPATION AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N667FE)
PARTICIPATION AGREEMENT (FEDERAL EXPRESS CORPORATION TRUST NO.
N667FE) dated as of August 1, 1996, as amended and restated as of October 15,
1996 (this "Agreement") among FEDERAL EXPRESS CORPORATION, a Delaware
corporation (herein, together with its successors and permitted assigns, the
"Lessee"), PMCC LEASING CORPORATION, a Delaware corporation (herein, together
with its successors and permitted assigns, the "Owner Participant"), ▇▇▇▇▇▇
GUARANTY TRUST COMPANY OF NEW YORK, BANK OF AMERICA NATIONAL TRUST & SAVINGS
ASSOCIATION, THE CHASE MANHATTAN BANK, COMMERZBANK AG, ATLANTA AGENCY and
NATIONSBANK, N.A. (SOUTH), (individually, together with its successors and
permitted assigns, an "Original Loan Participant" and collectively the
"Original Loan Participants"), FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity, except as
otherwise expressly stated herein, but solely as owner trustee under the Trust
Agreement referred to below (in such capacity as trustee, together with its
successors and permitted assigns, the "Owner Trustee"), STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company, not in its individual capacity,
except as otherwise expressly stated herein, but solely as indenture trustee
under the Indenture referred to below (in such capacity as trustee, together
with its successors and permitted assigns, the "Indenture Trustee") and STATE
STREET BANK AND TRUST COMPANY, a Massachusetts trust company, not in its
individual capacity, except as otherwise expressly stated herein, but solely
as pass through trustee (in such capacity as trustee, together with its
successors and permitted assigns, the "Pass Through Trustee").
W I T N E S S E T H :
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee entered into the Original
Participation Agreement (such term, and all other terms not heretofore
defined, shall have the meanings assigned thereto as provided in Article 1
below), providing for the sale and lease of the Aircraft that was delivered on
the Delivery Date;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Participant entered into the Original Trust
Agreement relating to the Aircraft with FSB in its individual capacity,
pursuant to which FSB agreed, among other things, to hold the Lessor's Estate
in trust for the benefit of the Owner Participant;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Trustee and the Indenture Trustee entered
into the Original Indenture, for the benefit of the Original Loan
Participants, pursuant to which the Owner Trustee issued to the Original Loan
Participants the Original Loan Certificates as evidence of the loans made by
the Original Loan Participants to the Owner Trustee, the proceeds of which
were used by the Owner Trustee to pay a portion of the Purchase Price for the
Aircraft;
WHEREAS, concurrently with the execution and delivery of the Original
Participation Agreement, the Owner Trustee and the Lessee entered into the
Original Lease relating to the Aircraft, whereby, subject to the terms and
conditions set forth in said Lease, the Owner Trustee agreed to lease the
Aircraft to the Lessee, and the Lessee agreed to lease the Aircraft from the
Owner Trustee, such lease of the Aircraft being evidenced by the execution and
delivery of the Lease Supplement;
WHEREAS, Article 15 of the Original Participation Agreement permits a
Refinancing of the Original Loan Certificates subject to the satisfaction of
the conditions specified in Section 15.01 thereof, and Section 3.04 of the
Original Lease contemplates the adjustment of the percentages for Basic Rent,
Stipulated Loss Value and Termination Value in the event of such a
Refinancing, and the Lessee has requested that the Owner Trustee effect such a
Refinancing and adjustment;
WHEREAS, in order to facilitate such Refinancing, the Lessee is
concurrently entering into an Underwriting Agreement, which relates to two
series of Pass Through Certificates that will be issued by the Pass Through
Trusts formed to acquire, among other securities, the Certificates bearing a
particular interest rate and having a particular Maturity that will be issued
under the Indenture;
WHEREAS, on the Pass Through Closing Date, a closing will occur with
respect to the public offering of the Pass Through Certificates issued by each
Pass Through Trust, an allocable amount of the proceeds of which offering will
be used by the Pass Through Trustee to purchase for each such Pass Through
Trust the Certificates of the interest rate and Maturity applicable thereto,
the proceeds of which purchase in turn will be applied to the Refinancing in
full of the outstanding principal amount of the Original Loan Certificates;
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have agreed, subject to
the terms and conditions hereinafter provided, to amend and restate, and to
add the Pass Through Trustee as a party to, the Original Participation
Agreement; and
WHEREAS, the Lessee, the Owner Participant, the Owner Trustee, the
Original Loan Participants and the Indenture Trustee have agreed, to the
extent they are parties thereto and, subject to the terms and conditions
hereinafter provided, to amend and restate the Original Indenture, to amend
and restate the Original Lease, to amend and restate the Original Ancillary
Agreement I, to amend the Original Tax Indemnity Agreement and to amend and
restate the Original Trust Agreement, each such amendment and restatement to
be executed and delivered simultaneously with the purchase of the Certificates
by the Pass Through Trustee for the Pass Through Trusts and the Refinancing in
full of the Original Loan Certificates.
NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereto agree, subject to the terms and
conditions hereinafter provided, that the Original Participation Agreement be
and the same is hereby amended and restated in its entirety as follows:
ARTICLE 1
DEFINITIONS
Unless otherwise specifically provided herein, the definitions set
forth in Schedule II hereto are incorporated herein for all purposes of this
Agreement and shall be equally applicable to both the singular and the plural
forms of the terms so defined.
ARTICLE 2
ISSUANCE OF PASS THROUGH CERTIFICATES;
REFUNDING THE ORIGINAL LOAN CERTIFICATES
Section 2.01. Transfer of Funds.
(a) On or before the Pass Through Closing Date, the Pass Through
Trustee and the Lessee, in accordance with the Pass Through Agreement, shall
enter into the Series Supplements, and, subject to the terms and conditions
set forth therein, on the Pass Through Closing Date (i) the Lessee shall
direct the Underwriters to execute a wire transfer or intra-bank transfer to
the Pass Through Trustee in the amount of the total proceeds payable pursuant
to the Underwriting Agreement with respect to the Pass Through Certificates
and (ii) the Pass Through Trustee shall deliver the Pass Through Certificates
to the Underwriters upon receipt by the Pass Through Trustee of such proceeds.
(b) Subject to the satisfaction or waiver of the conditions set
forth herein, on the Refunding Date the following events shall occur in the
order set forth below:
(i) the Lessee shall on behalf of the Owner Trustee execute a wire
transfer or intra-bank transfer in favor of the Agent in the amount of all
accrued and unpaid interest on the Original Loan Certificates to but
excluding the Refunding Date, which transfer shall constitute the payment
of a like amount of such accrued and unpaid interest;
(ii)the Lessee shall on behalf of the Owner Trustee execute a wire
transfer or intra-bank transfer in favor of the Agent as Supplemental Rent
in the amount of any Breakage Costs required to be paid pursuant to the
Original Indenture which transfer shall constitute the payment of all such
Breakage Costs;
(iii)for each Pass Through Trust, from an allocable amount of the
proceeds of the sale of the related Pass Through Certificates, the Pass
Through Trustee shall pay on behalf of the Owner Trustee in the manner
specified in paragraph (iv) below, an amount equal to the principal amount
of Certificates of the Maturity and having the interest rate that relates
to such Pass Through Trust, which amounts in the aggregate shall equal the
aggregate principal amount of the Certificates as specified in Section 2.04
of the Indenture;
(iv)the aggregate amount payable by the Pass Through Trustee pursuant
to paragraph (iii) above shall be payable by wire transfer or intra-bank
transfer in favor of the Agent on behalf of the Owner Trustee in the amount
of the outstanding principal amount of the Original Loan Certificates;
(v) the Agent shall apply the amounts received by it under paragraphs
(i), (ii) and (iv) of this subsection (b) to prepay the Original Loan
Certificates in full in accordance with Sections 2.06 and 2.10 of the
Original Indenture; and
(vi)the Owner Trustee shall cause the Certificates to be delivered to
the applicable Pass Through Trustee in accordance with Section 2.02 hereof.
On the Refunding Date concurrently with the events specified in
clauses (iii) through (v) of this Section 2.01(b), the parties hereto shall
execute and deliver, to the extent they are parties thereto, and consent to
the execution and delivery of (if they are not a party thereto), the
Indenture, the Lease and the Trust Agreement, and the Owner Trustee shall
execute and deliver to the Indenture Trustee for authentication, and the
Indenture Trustee shall authenticate and deliver to the applicable Pass Through
Trustee, upon the request of the Owner Trustee, the Certificates as provided
in Section 2.02 hereof. The Owner Participant hereby requests and directs the
Owner Trustee to execute and deliver this Agreement and, subject to the terms
hereof, to take the actions specified herein. The Original Loan Participants
by their execution and delivery hereof, request and direct the Indenture
Trustee to execute and deliver this Agreement and concurrently with the events
specified in clauses (iii) through (v) of this Section 2.01(b) and subject to
the terms and conditions hereof to take the actions contemplated herein. The
parties hereto, including, without limitation, the Original Loan Participants,
confirm that, as provided in Section 2.06 of the Original Indenture, upon
payment in full of the principal amount, Breakage Costs, if any, and interest
on the Original Loan Certificates and all other sums then payable to the
Original Loan Participants under the Original Agreements to the extent
specified in subsection (c) below, the Original Loan Participants shall have
no further interest in, or other right or obligation with respect to, the
Trust Indenture Estate, the Original Agreements or the Operative Agreements
(it being understood that the foregoing shall not limit or detract from any
claim that any Original Loan Participant may have under Article 8 or 9 or
Section 10.01(a)(ii) hereof or of the Original Participation Agreement) and,
accordingly, have no obligation to, and will not attempt to direct any future
actions of the Indenture Trustee with respect to the Trust Indenture Estate,
provided that the rights and obligations of the Original Loan Participants
shall, until the payment in full of such amounts to the Agent on behalf of the
Original Loan Participants on the Refunding Date, be governed by the Original
Participation Agreement and the other Operative Agreements contemplated
thereby or in effect immediately prior to the effectiveness of this Agreement
and shall, upon such payment and thereafter, be governed by this Agreement.
The Lessee hereby consents to the foregoing.
(c) Not less than four (4) Business Days prior to the Refunding
Date, the Agent on behalf of the Original Loan Participants shall give notice
in writing to the parties hereto of the principal amount, Breakage Costs, if
any, and interest on and all other amounts due on the Refunding Date under the
Original Loan Certificates and all other sums payable on the Refunding Date to
the Original Loan Participants under the Original Agreements, such notice to
be deemed final and binding on the Original Loan Participants as to the
respective amounts of principal, Breakage Costs, if any, and interest when
given; provided that the expected Refunding Date, at the time such notice is
given, is the same as the Refunding Date.
(d) On the Refunding Date, subject to (i) the giving of the written
notice referred to in Section 2.01(c) above to the Indenture Trustee and the
Original Loan Participants, (ii) the receipt by the Original Loan Participants
of the funds referred to in Section 2.01(b)(v) above and (iii) compliance with
the provisions of Article 15 of the Original Participation Agreement and
Section 2.10(c) of the Original Indenture (including the Refinancing in full
of the Original Loan Certificates), the Original Loan Participants shall
deliver the Original Loan Certificates to the Indenture Trustee for
cancellation and delivery to the Owner Trustee.
(e) The closing with respect to the acquisition of the Pass Through
Certificates by the Underwriters and the closing with respect to the
Refinancing of the Original Loan Certificates (together, the "Closings") shall
take place at the offices of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
(f) All payments pursuant to this Section 2.01 shall be made in
immediately available funds.
(g) In the event that the Refunding Date and the actions
contemplated to occur on such date pursuant to subsection (d) of this Section
2.01 do not occur on or before November 30, 1996, then the rights and
obligations of the parties to the Original Participation Agreement, including,
without limitation, the Original Loan Participants, shall be governed by the
Original Participation Agreement and the other Operative Agreements
contemplated thereby or in effect immediately prior to the effectiveness of
this Agreement and this Agreement shall be of no further force and effect,
except that the Lessee shall be obligated hereby to pay all fees and expenses
of the Original Loan Participants, the Indenture Trustee, the Owner
Participant, the Owner Trustee, the Pass Through Trustee and their respective
counsel relating to the transactions contemplated hereby. Each of the parties
hereto agrees to execute and deliver to the other parties such documents and
instruments as may be necessary to give effect to the foregoing provisions of
this subsection (g).
Section 2.02. Certificates. Subject to the satisfaction or waiver
of the conditions set forth herein, on the Refunding Date, the Owner Trustee
shall execute and deliver to the Indenture Trustee, and the Indenture Trustee
shall authenticate and deliver, upon the request of the Owner Trustee, to the
Pass Through Trustee for each Pass Through Trust, the Certificate specified
for such Pass Through Trust on Schedule I attached hereto, which (i) shall be
issued in the principal amount and in the Maturity set forth for such
Certificate in Schedule I hereto, (ii) shall bear interest at the interest
rate set forth for such Certificate in Schedule I hereto, (iii) shall be
issued in such form and on such terms as are specified in the Indenture, (iv)
shall be dated and authenticated on the Refunding Date and shall bear interest
from the Refunding Date and (v) shall be registered in the name of the Pass
Through Trustee on behalf of such Pass Through Trust.
ARTICLE 3
EXTENT OF INTEREST OF ORIGINAL LOAN PARTICIPANTS
Section 3.01. Extent of Interest of Original Loan Participants.
Delivery of the Original Loan Certificates by the Original Loan Participants
to the Indenture Trustee for cancellation on the Refunding Date shall be
conclusive evidence of receipt by the Original Loan Participants of all
amounts then due and payable to the Original Loan Participants in respect of
principal of, Breakage Costs, if any, and interest on the Original Loan
Certificates under the Original Agreements (it being understood that the
foregoing shall not limit or detract from any claim any Original Loan
Participant may have under Article 8 or 9 or Section 10.01(a)(ii) hereof or of
the Original Participation Agreement).
ARTICLE 4
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent. The obligations of the Owner
Trustee, the Owner Participant, the Indenture Trustee and the Pass Through
Trustee on behalf of each Pass Through Trust to participate in the
transactions contemplated hereby on the Refunding Date are subject to the
fulfillment to the satisfaction of such party (or waiver by such party), prior
to or on the Refunding Date, of the following conditions precedent (it being
understood that receipt by the Lessee of any of the following documents shall
not be a condition precedent to the obligations of any party):
(a) Certificates. On the Refunding Date, there shall have been duly
issued and delivered by the Owner Trustee to the Pass Through Trustee for
each Pass Through Trust, against payment therefor, a Certificate,
substantially in the form set forth in Exhibit B to the Indenture, duly
authenticated, dated the Refunding Date and registered in the name of the
Pass Through Trustee on behalf of such Pass Through Trust, in the principal
amounts, Maturity, bearing the interest rate and the other economic terms
specified in the Series Supplements and otherwise as provided in Section
2.04 of the Indenture. The Pass Through Certificates shall be registered
under the Securities Act, any applicable state securities laws shall have
been complied with, and the Pass Through Agreement shall have been qualified
under the Trust Indenture Act.
(b) Legal Investment. On the Refunding Date, no fact or condition
shall exist under applicable laws or regulations, or interpretations of any
such laws or regulations by applicable regulatory authorities, which, in
the opinion of the Owner Participant or its special counsel, the Pass
Through Trustee or the Indenture Trustee or their special counsel, would
make it illegal for the Owner Participant, the Lessee, the Owner Trustee,
the Pass Through Trustee or the Indenture Trustee, and no change in
circumstances shall have occurred which would otherwise make it illegal or
otherwise in contravention of guidance issued by regulatory authorities for
the Owner Participant, the Lessee, the Owner Trustee, the Pass Through
Trustee or the Indenture Trustee, to participate in the transaction to be
consummated on the Refunding Date; and no action or proceeding shall have
been instituted nor shall governmental action before any court,
governmental authority or agency be threatened which in the opinion of
counsel for the Owner Participant, the Indenture Trustee or the Pass
Through Trustee is not frivolous, nor shall any order have been issued or
proposed to be issued by any court, or governmental authority or agency,
as of the Refunding Date, to set aside, restrain, enjoin or prevent the
consummation of any of the transactions contemplated by this Agreement or by
any of the other Operative Agreements.
(c) Underwriters. The Underwriters shall have transferred the funds
specified in Section 2.01(a) hereof and all conditions thereunder shall
have been satisfied or waived.
(d) Refunding Documents. This Agreement and the following documents
shall have been duly authorized, executed and delivered by the respective
party or parties thereto, shall each be satisfactory in form and substance
to the Lessee, the Owner Trustee, the Indenture Trustee, the Pass Through
Trustee and the Owner Participant (each acting directly or by authorization
to its special counsel) and shall each be in full force and effect; there
shall not have occurred any default thereunder, or any event which with the
lapse of time or the giving of notice or both would be a default
thereunder, and copies executed or certified as requested by the Lessee,
the Owner Trustee, the Indenture Trustee, the Pass Through Trustee or the
Owner Participant, as the case may be, of such documents shall have been
delivered to the Owner Participant, the Lessee, the Indenture Trustee, the
Pass Through Trustee and the Owner Trustee (provided that the sole
chattel-paper original of each of the Lease, the Lease Supplement and each
Ancillary Agreement amendatory of the Lease, shall be delivered to the
Indenture Trustee):
(i) the Lease;
(ii) the Indenture;
(iii) in the case of the Owner Participant only, Amendment No. 1 to
the Original Tax Indemnity Agreement;
(iv) the Trust Agreement;
(vi) the Ancillary Agreement I; and
(vii) the Ancillary Agreement II.
(e) Insurance. Each of the Indenture Trustee, the Pass Through
Trustee, the Owner Trustee and the Owner Participant shall have received
such evidence as it deems appropriate, including, without limitation, an
independent insurance broker's report, together with certificates of
insurance from such broker, in form and substance satisfactory to the
Indenture Trustee, the Pass Through Trustee, the Owner Trustee and the
Owner Participant to establish that the insurance required by Article 13 of
the Lease is in effect.
(f) Financing Statements. (i) Uniform Commercial Code ("UCC")
financing statements covering all the security interests (and other
interests) created by or pursuant to the Granting Clause of the Original
Indenture shall have been executed and delivered by the Owner Trustee, as
debtor, and by the Indenture Trustee, as secured party, for and on behalf
of the Original Loan Participants, and such financing statements shall have
been duly filed in the State of Utah; (ii) a form UCC-3 financing statement
to amend and restate each financing statement referred to in the
immediately preceding sentence shall have been executed and delivered by
the Owner Trustee, as debtor, and by the Indenture Trustee as secured
party, and a form UCC-1 financing statement covering all the security
interests (and other interests) created by or pursuant to the Granting
Clause of the Indenture shall have been executed and delivered by the Owner
Trustee, as debtor, and by the Indenture Trustee, as secured party, for and
on behalf of the Holders, and concurrently with the Refinancing of the
Original Loan Certificates such UCC-3 financing statement and UCC-1
financing statement shall have been duly filed or duly submitted for filing
in the State of Utah, and all other actions shall have been taken which, in
the opinion of special counsel for the Pass Through Trustee or for the
Underwriters, are necessary or desirable to maintain the perfection of the
security interest created by or pursuant to the Granting Clause of the
Indenture; (iii) a UCC notice filing describing the Original Lease as a
lease shall have been executed and delivered by the Owner Trustee, as
lessor, and the Lessee, as lessee (which filing shall name the Indenture
Trustee as assignee of the Owner Trustee), and shall have been duly filed
in the State of Tennessee; and (iv) a form UCC-3 financing statement to
amend and restate the UCC notice filing referred to in the immediately
preceding clause (iii) shall have been executed and delivered by the Owner
Trustee, as lessor, and by the Lessee, as lessee (which filing shall name
the Indenture Trustee as assignee of the Owner Trustee), and such notice
filing shall concurrently with the Refinancing of the Original Loan
Certificates have been duly filed in the State of Tennessee, and all other
actions shall have been taken which, in the opinion of the Owner
Participant, Pass Through Trustee and the Underwriters, are necessary to
perfect and protect such security interests and other interests created by
or pursuant to the Granting Clause of the Indenture.
(g) Corporate Documents. Except when such Person is the delivering
party, the Owner Participant, the Owner Trustee, the Original Loan
Participants, the Pass Through Trustee, the Lessee and the Indenture
Trustee (acting directly or by authorization to its counsel) shall have
received the following, in each case in form and substance satisfactory to
it:
(i) a copy of the certificate of incorporation and by-laws of
the Lessee, certified by the Secretary or an Assistant Secretary of
the Lessee as of the Refunding Date, and a copy of the minutes of the
regular meeting of the board of directors of the Lessee, certified as
such as of the Refunding Date by such Secretary or Assistant
Secretary, duly authorizing the lease by the Lessee of the Aircraft
under the Lease and the execution, delivery and performance by the
Lessee of the Original Agreements to which it is a party, this
Agreement, the Lease, the Tax Indemnity Agreement, the Pass Through
Agreement, the Series Supplements, the other Operative Agreements to
which the Lessee is or is to be a party and each other document to be
executed and delivered by the Lessee in connection with the
transactions contemplated hereby;
(ii) a copy of the articles of incorporation and bylaws of the
Owner Participant, certified by the Secretary or an Assistant
Secretary of the Owner Participant as of the Refunding Date, and a
copy of the resolutions of the board of directors of the Owner
Participant, certified as such as of the Refunding Date by such
Secretary or an Assistant Secretary, authorizing the execution and
delivery by the Owner Participant of the Original Agreements to which
it is a party, this Agreement, the Tax Indemnity Agreement, the Trust
Agreement and the other Operative Agreements to which the Owner
Participant is or is to be a party and each other document to be
executed and delivered by the Owner Participant in connection with
the transactions contemplated hereby;
(iii) a copy of the articles of association and by-laws and
other instruments of the Owner Trustee, certified by the Secretary or
an Assistant Secretary of the Owner Trustee as of the Refunding Date
(or other like instruments satisfactory to the Lessee and the Owner
Participant) and evidence authorizing the execution, delivery and
performance by the Owner Trustee in its individual capacity or as
Owner Trustee, as the case may be, of the Original Agreements to
which it is a party, this Agreement, the Trust Agreement and each of
the other Operative Agreements to which it is or is to be a party,
whether in its individual capacity or as Owner Trustee, and each
other document to be executed and delivered by the Owner Trustee in
connection with the transactions contemplated hereby;
(iv) a copy of the certificate of incorporation and by-laws
and other instruments of the Indenture Trustee, certified by the
Secretary or an Assistant Secretary of the Indenture Trustee as of
the Refunding Date (or other like instruments satisfactory to the
Lessee and the Owner Participant) and evidence authorizing the
execution, delivery and performance by the Indenture Trustee of each
of the Original Agreements to which it is party, this Agreement, the
Indenture and each of the other Operative Agreements to which it is
or is to be a party, and each other document to be executed and
delivered by the Indenture Trustee in connection with the transactions
contemplated hereby;
(v) a copy of the certificate of incorporation and by-laws
and other instruments of the Pass Through Trustee, certified by the
Secretary or an Assistant Secretary of the Pass Through Trustee as of
the Refunding Date (or other like instruments satisfactory to the
Lessee and the Owner Participant) and evidence authorizing the
execution, delivery and performance by the Pass Through Trustee of
this Agreement, the Pass Through Agreement, the Series Supplements
and each of the other Operative Agreements to which it is or is to be
a party, and each other document to be executed and delivered by the
Pass Through Trustee in connection with the transactions contemplated
hereby; and
(vi) such other documents, evidences, materials, and
information with respect to the Lessee, the Owner Trustee, the
Indenture Trustee, the Pass Through Trustee and the Owner Participant
as the Indenture Trustee, the Pass Through Trustee or the Owner
Participant may reasonably request in order to establish the
consummation of the transactions contemplated by this Agreement.
(h) Title, Airworthiness and Registration. On the Refunding Date,
the following statements shall be true, and the Owner Participant, the
Owner Trustee, the Pass Through Trustee and the Indenture Trustee shall
have received evidence from the Lessee reasonably satisfactory to each such
Person to the effect that:
(i) the Owner Trustee has good and marketable title to the
Aircraft, free and clear of Liens, except the rights of the Owner
Trustee and the Lessee under the Lease and the Lease Supplement
covering the Aircraft, the rights of the Indenture Trustee under the
Indenture and the beneficial interest of the Owner Participant
created by the Trust Agreement and the interest of the Holders
created by the Indenture and the Indenture and Security Agreement
Supplement covering the Aircraft;
(ii) the Aircraft has been duly certificated by the Aeronautics
Authority as to type and airworthiness in accordance with the terms
of the Operative Agreements;
(iii) the Lease, the Indenture and the Trust Agreement
concurrently with the Refinancing of the Original Loan Certificates
have been duly filed for recordation (or shall be in the process of
being so duly filed for recordation) with the Aeronautics Authority
pursuant to the Transportation Code; and
(iv) the Aircraft is registered in the name of the Owner
Trustee.
(i) Officer's Certificate of Lessee. On the Refunding Date, the
following statements shall be true, and the Owner Participant, the Owner
Trustee, the Pass Through Trustee and the Indenture Trustee shall have
received a certificate signed by the Vice President and Treasurer or any
other duly authorized officer of the Lessee, dated the Refunding Date,
stating that:
(i) the representations and warranties of the Lessee
contained in the Operative Agreements to which it is a party
(excluding the Tax Indemnity Agreement) and in any certificate
delivered pursuant hereto or thereto are true and correct on and as
of the Refunding Date 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 certificate shall state that
such representations and warranties were true and correct on and as
of such earlier date);
(ii) except for the matters described (i) under "Legal
Proceedings" in the Lessee's Annual Report on Form 10-K for the
fiscal year ended May 31, 1996 (as updated by Note 7 to the financial
statements included in the Lessee's Quarterly Report on Form 10-Q for
the fiscal quarter ended August 31, 1996) and (ii) in the Lessee's
Current Reports on Form 8-K dated June 7, 1996 and August 16, 1996,
as to which such officer will make no certification concerning the
liability of the Lessee (if any), or the effect of any adverse
determination upon the consolidated financial condition, business or
operations of the Lessee, no material adverse change has occurred in
the financial condition, business or operations of the Lessee from
that shown in the audited financial statements of the Lessee as of
May 31, 1995 or the unaudited consolidated financial statements of
the Lessee as of August 31, 1996 and nothing has occurred which will,
in the judgment of such officer, materially adversely affect the
ability of the Lessee to carry on its business or to perform its
obligations under this Agreement and each other Operative Agreement
to which it is or is to be a party; and
(iii) no event has occurred and is continuing, or would result
from the purchase, sale, mortgage, or lease of the Aircraft, which
constitutes an Event of Loss (or event which with the passage of time
would become an Event of Loss) with respect to the Airframe or any
Engine, or a Default or an Event of Default under the Lease.
(j) Officer's Certificate of Owner Participant. On the Refunding
Date, the following statements shall be true, and the Lessee, the Pass
Through Trustee, the Owner Trustee and the Indenture Trustee shall have
received a certificate from the Owner Participant, signed by a duly
authorized officer of the Owner Participant dated the Refunding Date,
stating that:
(i) the representations and warranties of the Owner
Participant contained in this Agreement, the Trust Agreement and any
other Operative Agreement to which it is a party (excluding the Tax
Indemnity Agreement) and in any certificate delivered pursuant hereto
or thereto, are true and correct on and as of the Refunding Date 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 certificate shall state that such representations and
warranties were true and correct on and as of such earlier date);
(ii) no Lessor's Liens attributable to the Owner Participant
exist; and
(iii) no event has occurred and is continuing which constitutes
or, with notice or lapse of time or both would constitute, due to any
action or omission on the part of the Owner Participant, an Indenture
Event of Default other than an Indenture Event of Default
attributable to a Lease Event of Default.
(k) Other Officer's Certificates. On the Refunding Date, the
following statements shall be true, and the Owner Participant, the Lessee,
the Pass Through Trustee, the Owner Trustee and the Indenture Trustee shall
have received a certificate from each of FSB and the Owner Trustee (in the
case of the Lessee, the Pass Through Trustee, the Owner Participant and the
Indenture Trustee), SSB and the Indenture Trustee (in the case of the
Lessee, the Pass Through Trustee, the Owner Participant and the Owner
Trustee) and SSB and the Pass Through Trustee (in the case of the Lessee,
the Indenture Trustee, the Owner Participant and the Owner Trustee) signed
by a duly authorized officer of FSB and SSB, respectively, dated the
Refunding Date, stating with respect to FSB and the Owner Trustee, with
respect to SSB and the Indenture Trustee, or with respect to SSB and the
Pass Through Trustee, as the case may be, that:
(i) the representations and warranties of FSB in its
individual capacity and as Owner Trustee, of SSB in its individual
capacity and as Indenture Trustee and of SSB in its individual
capacity and as Pass Through Trustee contained in this Agreement, the
Lease, the Trust Agreement and the Indenture and in any certificate
delivered pursuant hereto or thereto are true and correct on and as
of the Refunding Date 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 certificate shall state that
such representations and warranties were true and correct on and as
of such earlier date);
(ii) to the best of its knowledge, no event has occurred and is
continuing, which constitutes or which, but for the lapse of time or
the giving of notice, or both, would constitute, due to any action or
omission on the part of FSB in its individual capacity or as Owner
Trustee, of SSB in its individual capacity or as Indenture Trustee
and of SSB in its individual capacity or as Pass Through Trustee, an
Event of Default or an Indenture Event of Default; and
(iii) there are no Lessor's Liens attributable to the Owner
Trustee or FSB and no Indenture Trustee's Liens affecting the Trust
Indenture Estate or the Lessor's Estate or any part thereof.
(l) Legal Opinions. The Owner Participant, the Agent, the Original
Loan Participants, the Underwriters, the Lessee, the Owner Trustee, the
Pass Through Trustee and the Indenture Trustee (acting directly or by
authorization to its special counsel) shall have received from the
following counsel their respective legal opinions in each case satisfactory
to the Owner Participant, the Agent, the Original Loan Participants, the
Underwriters, the Lessee, the Owner Trustee, the Pass Through Trustee or
the Indenture Trustee, as the case may be, as to scope and substance (and
covering such other matters as the recipient may reasonably request) and
dated the Refunding Date:
(i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Law of the Lessee, in
the form of Exhibit A(1)(a) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Owner Trustee, the Pass Through Trustee and the Indenture Trustee;
(ii) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Owner
Participant, in the form of Exhibit A(2)(a) hereto and the General
Counsel's Office of the Owner Participant, in the form of Exhibit
A(2)(b) hereto, each addressed to the Agent, the Original Loan
Participants, the Underwriters, the Owner Participant, the Indenture
Trustee, the Owner Trustee, the Pass Through Trustee and the Lessee;
(iii) ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel for the
Indenture Trustee, in the form of Exhibit A(3) hereto and addressed
to the Agent, the Original Loan Participants, the Underwriters, the
Owner Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee;
(iv) ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special aviation counsel,
in the form of Exhibit A(4) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Lessee;
(v) Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel for the Owner
Trustee, in the form of Exhibit A(5) hereto and addressed to the
Agent, the Original Loan Participants, the Underwriters, the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee;
(vi) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Lessee, in
the form of Exhibit A(1)(b) hereto and addressed to the Agent, the
Original Loan Participants, the Underwriters, the Owner Participant,
the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Lessee; and
(vii) ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel for the Pass
Through Trustee, in the form of Exhibit A(6) hereto and addressed to
the Agent, the Original Loan Participants, the Underwriters, the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Lessee.
(m) No Indenture Event of Default. No Indenture Event of Default or
Indenture Default has occurred and is continuing.
(n) Event of Default; Default; Event of Loss. No Default or Event
of Default under the Lease or Event of Loss or event, which with the
passage of time or if continued unremedied or unaltered would constitute an
Event of Loss, shall have occurred or be in existence.
(o) Cancellation. Following the Refinancing of the Original Loan
Certificates, the Original Loan Certificates shall have been duly delivered
by the Original Loan Participants to the Indenture Trustee for cancellation
and delivery to the Owner Trustee.
(p) Other Agreements. The Lessee and the Pass Through Trustee shall
have entered into the Pass Through Agreement and the Series Supplements, all
conditions to the effectiveness of each thereof shall have been satisfied
or waived, and the Pass Through Certificates shall have been issued
pursuant to the Series Supplements. The Lessee and the Underwriters shall
have entered into the Underwriting Agreement, all conditions to the
effectiveness thereof shall have been satisfied or waived, and the Pass
Through Certificates shall have been delivered pursuant to the Underwriting
Agreement.
(q) Notice, Etc. The Owner Trustee, the Owner Participant, the
Lessee, the Indenture Trustee and the Pass Through Trustee shall have
received a refunding notice pursuant to Section 2.01(c) hereof.
(r) Payment of Taxes. (A) All taxes, fees, charges, assessments,
costs and other expenses then due and payable in connection with the
execution, delivery, recording and filing of all financing statements and
the documents and instruments referred to in subparagraph (f) of this
Section 4.01; and (B) all sales or use taxes and duties related to the
consummation of the transactions contemplated by the Operative Agreements
then due and payable shall have been duly paid in full.
(s) Governmental Compliance. All appropriate action required to have
been taken by the FAA, or any governmental or political agency, subdivision
or instrumentality of the United States, prior to the Refunding Date in
connection with the transactions contemplated by this Agreement shall have
been taken, and all orders, permits, waivers, authorizations, exemptions
and approvals (collectively "permits") of such entities required to be in
effect on the Refunding Date in connection with the transactions
contemplated by this Agreement shall have been issued, and all such permits
shall be in full force and effect on the Refunding Date.
(t) Compliance with Original Participation Agreement. All conditions
precedent set forth in Section 15.01 of the Original Participation
Agreement shall be met to the satisfaction of the Owner Participant.
Section 4.02. Opinion of Special Aviation Counsel. Promptly upon
the filing and, where appropriate, recording of the documents specified in
4.01(h)(iii) hereof, pursuant to the Transportation Code the Lessee shall
cause Special Aviation Counsel to deliver to the Owner Participant, the Owner
Trustee, the Pass Through Trustee and the Indenture Trustee an opinion as to
(i) the due recording of such documents and the documents identified in
Section 4.01(i) of the Original Participation Agreement and (ii), subject to
customary qualifications, the lack of any intervening documents with respect
to the Aircraft.
ARTICLE 5
CONDITIONS PRECEDENT TO LESSEE'S OBLIGATIONS
Section 5.01. Conditions Precedent to Lessee's Obligations. The
Lessee's obligation to participate in the transactions contemplated hereby is
subject to the conditions that, prior to or on the Refunding Date, the Lessee
shall have received the certificates and other documents which are referred to
in, or the opinions to be addressed to it under, as the case may be,
paragraphs (d), (g)(ii)-(v), (h)(ii)-(iv), (j), (k) and (l)(ii), (iii), (iv),
(v), (vi) and (vii) of Section 4.01 hereof and the Underwriters and the Owner
Participant shall have made available the amounts required to be paid by them
pursuant to Section 2.01 hereof.
ARTICLE 6
LESSEE'S REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 6.01. Lessee's Representations and Warranties. The Lessee
represents and warrants to the Owner Participant, the Owner Trustee (in its
individual capacity and as Owner Trustee), the Pass Through Trustee (in its
individual capacity and as Pass Through Trustee) and the Indenture Trustee (in
its individual capacity and as Indenture Trustee) that, on the date hereof and
as of the Refunding Date:
(a) the Lessee is a corporation duly organized and validly existing
and is in good standing under the laws of the State of Delaware with its
principal place of business and chief executive office (as such terms are
used in Article 9 of the Uniform Commercial Code) in Memphis, Tennessee,
and is duly qualified to do business as a foreign corporation and is in
good standing in all jurisdictions in which it has intrastate routes, or
offices or major overhaul facilities or in which other activities of the
Lessee require such qualification;
(b) the Lessee has full power, authority and legal right to conduct
its business and operations as currently conducted and to own or hold under
lease its Properties and to enter into and perform its obligations under
this Agreement, the Original Agreements to which it is a party, the other
Operative Agreements to which it is a party, the Pass Through Agreement and
the Series Supplements (the "Lessee Documents");
(c) the Lessee is an "air carrier" within the meaning of the
Transportation Code and a holder of a certificate under Sections 41102(a)
and 41103 of the Transportation Code and a "citizen of the United States"
within the meaning of Section 40102(a)(15) of the Transportation Code
holding an "air carrier operating certificate" issued under Chapter 447 of
the Transportation Code for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, and each such certificate is
in full force and effect;
(d) the Lessee possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents (collectively
"permits") which are material to the operation of the routes flown by it
and the conduct of its business and operations as currently conducted and
each such permit is in full force and effect;
(e) the execution, delivery and performance of the Lessee Documents
by the Lessee have been duly authorized by all necessary corporate action
on the part of the Lessee and do not require any stockholder approval, or
approval or consent of any trustee or holder of any indebtedness or
obligations of the Lessee, and each such document has been duly executed
and delivered by the Lessee and constitutes the legal, valid and binding
obligations of the Lessee enforceable against it in accordance with the
terms thereof except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws or equitable
principles of general application to or affecting the enforcement of
creditors' rights generally (regardless of whether enforceability is
considered in a proceeding in equity or at law);
(f) no authorization, consent or approval of or other action by, and
no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by the Lessee of the Lessee Documents or for the
use and maintenance of the Aircraft except for such registrations,
applications and recordings referred to in the opinions of Special Aviation
Counsel delivered or to be delivered pursuant to Sections 4.01(l)(iv) and
4.02 hereof and except for the filings referred to in Section 4.01(f)
hereof, all of which shall have been duly obtained or made and shall be in
full force and effect on and as of the Refunding Date or as contemplated by
said Sections;
(g) neither the execution, delivery or performance by the Lessee of
the Lessee Documents nor compliance with the terms and provisions hereof or
thereof, conflicts or will conflict with or results or will result in a
breach or violation of any of the terms, conditions or provisions of, or
will require any consent or approval under, any law, governmental rule or
regulation or the charter documents, as amended, or bylaws, as amended, of
the Lessee or any order, writ, injunction or decree of any court or
governmental authority against the Lessee or by which it or any of its
Properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which the Lessee is a party or by which it or
any of its Properties is bound, or constitutes or will constitute a default
thereunder or results or will result in the imposition of any Lien upon any
of its Properties;
(h) there are no pending or, to the knowledge of the Lessee,
threatened actions, suits, investigations or proceedings (whether or not
purportedly on behalf of the Lessee) against or affecting the Lessee or any
of its Property before or by any court or administrative agency which (A)
involve the Aircraft, (B) except for the matters described (i) under "Legal
Proceedings" in the Lessee's Annual Report on Form 10-K for the fiscal year
ended May 31, 1996 (as updated by Note 7 to the financial statements
included in the Lessee's Quarterly Report on Form 10-Q for the fiscal
quarter ended August 31, 1996) and (ii) in the Lessee's Current Reports on
Form 8-K dated June 7, 1996 and August 16, 1996, as to which no
representation is made concerning the Lessee's liability (if any) or the
effect of any adverse determination upon the consolidated financial
condition, business or operations of the Lessee, if adversely determined,
would materially and adversely affect the consolidated financial condition,
business or operations of the Lessee, or (C) if adversely determined would
adversely affect the ability of the Lessee to perform its obligations under
the Lessee Documents;
(i) the Lessee has filed or caused to be filed all tax returns which
are required to be filed and has paid or caused to be paid all taxes shown
to be due and payable pursuant to such returns or pursuant to any
assessment received by the Lessee (other than assessments the payment of
which is being contested in good faith by the Lessee by appropriate
proceedings that do not involve any material danger of sale, forfeiture or
loss of the Aircraft or any part thereof), and the Lessee has no knowledge
of any related actual or proposed deficiency or additional assessment which
either in any case or in the aggregate would materially adversely affect
the Lessee's consolidated financial condition (other than, in any such case,
assessments, the payment of which is being contested in good faith by the
Lessee, as to which no representation is made concerning the Lessee's
liability (if any) or the effect of any adverse determination upon the
Lessee's consolidated financial condition);
(j) except for (A) the filing and, where appropriate, recordation
pursuant to the Transportation Code of the Indenture, the Trust Agreement
and the Lease, (B) the filing of the financing statements referred to in
Section 4.01(f) hereof and (C) the taking of possession by the Indenture
Trustee of the original counterpart of the Lease and maintaining possession
of the original counterpart of the Lease Supplement delivered on the
Delivery Date, no further action, including any filing or recording of any
document, is necessary or advisable in order (i) to establish the Owner
Trustee's title to and interest in the Aircraft and the Lessor's Estate as
against the Lessee and any third parties, or (ii) to perfect the first
security interests in and mortgage Lien on the Trust Indenture Estate in
favor of the Indenture Trustee;
(k) on the Delivery Date, the Owner Trustee received good and
marketable title to the Aircraft, free and clear of all Liens, except the
rights of the Owner Trustee and the Lessee under the Original Lease, the
rights of the Indenture Trustee under the Original Indenture, the
beneficial interest of the Owner Participant created by the Original Trust
Agreement and the interest of the Original Loan Participants created by the
Original Indenture and the Indenture and Security Agreement Supplement
covering the Aircraft;
(l) the Lessee has heretofore delivered to the Owner Participant
true and correct copies of the Lessee's Annual Reports on Form 10-K for the
fiscal years ended May 31, 1995 and May 31, 1996 and its Quarterly Report
on Form 10-Q for the fiscal quarter ended August 31, 1996, and of the
audited consolidated balance sheets of the Lessee for the fiscal years
ended May 31, 1995 and May 31, 1996 and the unaudited consolidated balance
sheet of the Lessee as of August 31, 1996, and the related consolidated
statements of income, changes in common stockholders' investment and cash
flows for the fiscal year and interim reporting period ended on such dates,
accompanied (except in the case of such interim reporting period) by a
report thereon containing opinions without qualification, except as therein
noted, by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent public accountants; said
financial statements have been prepared in accordance with generally
accepted accounting principles consistently applied and present fairly the
financial position of the Lessee as of such dates and the results of its
operations and cash flows for such periods and such Annual Reports,
Quarterly Report and financial statements did not, as of their respective
dates of filing with the SEC, contain any untrue statement of a material
fact or omit a material fact necessary to make the statements contained
therein not misleading;
(m) with respect to ERISA:
(i) none of the Pension Plans (as defined at the end of this
Section 6.01(m)) nor their related trusts have been terminated in a
distress termination pursuant to Section 4041(c) of ERISA or by the
Pension Benefit Guaranty Corporation (together with any successor
agency or instrumentality thereto, the "PBGC") pursuant to Section
4042 of ERISA, nor have any actions been taken to so terminate any
Pension Plan or related trust and neither the Lessee nor any ERISA
Affiliate (as defined at the end of this Section 6.01(m)) has
incurred or could reasonably be expected to incur any material
liability with respect to a Pension Plan under Section 4062, 4063,
4064 or 4069 of ERISA;
(ii) there have been no "reportable events" (as such term is
defined in Section 4043(b) of ERISA) with respect to any Pension Plan
which have resulted or could reasonably be expected to result in any
material liability of the Lessee or any ERISA Affiliate;
(iii) no "accumulated funding deficiency" (as such term is
defined in Section 302 of ERISA or Section 412 of the Code) exists
with respect to any Pension Plan, whether or not waived, nor has any
request for a waiver under Section 412(d) of the Code been, or is
reasonably likely to be, filed with respect to any of the Pension
Plans;
(iv) neither the Lessee nor any ERISA Affiliate has failed to
make any contribution or payment to any Pension Plan which has
resulted or could reasonably be expected to result in the imposition
of a Lien under Section 302(f) of ERISA or Section 412(n) of the Code;
(v) all Pension Plans are in compliance in all material
respects with all applicable provisions of ERISA and the Code;
(vi) neither the Lessee nor any ERISA Affiliate has incurred
or is reasonably likely to incur any material withdrawal liability
pursuant to Section 4201 or 4204 of ERISA or any material liability
under Section 515 of ERISA;
(vii) to the best of the Lessee's knowledge, neither the Lessee
nor any ERISA Affiliate has engaged in a "prohibited transaction"
(within the meaning of Section 4975 of the Code or Section 406 of
ERISA) which could reasonably be expected to subject the Lessee to
the tax or penalties on prohibited transactions imposed by Section
4975 of the Code or Section 502 of ERISA; and
(viii) assuming the truth of the representations contained in
Sections 7.03(a)(viii) and 7.09 hereof and compliance with Section
10.06 of the Indenture, the execution and delivery of this Agreement
and the other Operative Agreements and the consummation of the
transactions contemplated hereby and thereby will not involve any
transaction which is prohibited by Section 406 of ERISA or in
connection with which a tax could be imposed pursuant to Section 4975
of the Code. No part of the funds to be used by the Lessee in
satisfaction of its obligations under this Agreement or any other of
the Operative Agreements to which the Lessee is a party or to which
the Lessee is bound are the assets of any employee benefit plan
subject to Title I of ERISA, or any individual retirement account or
an employee benefit plan subject to Section 4975 of the Code;
as used in this Section 6.01(m), the term "Pension Plan" means an employee
pension benefit plan as defined in Section 3(2) of ERISA (other than a
multiemployer plan as defined in Section 4001(a)(3) of ERISA) which is
covered by Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code and which is maintained, or contributed to,
by the Lessee or any ERISA Affiliate, and the term "ERISA Affiliate" means
any entity which together with the Lessee would be treated as a single
employer under Section 414(b), (c), (m) or (o) of the Code;
(n) the Lessee is a Citizen of the United States;
(o) except for the filings referred to in Section 4.01(f) hereof, no
governmental approval of any kind is required of the Owner Participant or
for the Owner Participant's execution of or performance under this
Agreement or any agreement contemplated hereby by reason of any fact or
circumstance of the Lessee, the nature of the Aircraft or the Lessee's
proposed operations or use of the Aircraft;
(p) on the Refunding Date, all premiums with respect to the insurance
required to be provided by the Lessee on or prior to the Refunding Date
under Article 13 of the Lease have been paid by the Lessee;
(q) on the Refunding Date, all sales or use taxes relating to the
sale of the Aircraft by AVSA to the Owner Trustee which are then or were
theretofore due shall have been paid;
(r) the Lessee is not in default under any mortgage, deed of trust,
indenture, lease or other instrument or agreement to which the Lessee is a
party or by which it or any of its Properties or assets may be bound, or in
violation of any applicable law, which default or violation would have a
material adverse effect on the financial condition, business or operations
of the Lessee or its ability to perform any of its obligations under the
Lessee Documents;
(s) no Default or Event of Default or Event of Loss or event, which
with the passage of time or if continued unremedied or unaltered would
constitute an Event of Loss, has occurred or exists;
(t) the Aircraft has been duly certificated by the FAA as to type and
airworthiness; there is in effect with respect to the Aircraft a current
and valid airworthiness certificate issued by the FAA pursuant to the
Transportation Code; and there is no fact known to the Lessee which
materially adversely affects the value, utility or condition of the
Aircraft;
(u) on the Refunding Date, the Lessee shall not be in default in the
performance of any term or condition of the Purchase Agreement, the Purchase
Agreement Assignment, the Engine Warranty Assignment and the GTA;
(v) neither the Lessee nor any subsidiary of the Lessee is an
"investment company" or a company "controlled by an investment company"
within the meaning of the Investment Company Act of 1940, as amended;
(w) the Aircraft is fully equipped to operate in commercial service
and will comply with all governmental requirements governing such service;
(x) there are no broker's or underwriter's or management fees
payable on behalf of the Lessee in connection with the transactions
contemplated in the Operative Agreements other than those of the
Underwriters and First Chicago Leasing Corporation referred to in Article
10 hereof; and
(y) the representations and warranties of the Lessee set forth in the
Original Agreements to which it is a party were correct on and as of the
Delivery Date (except to the extent such representations expressly related
solely to a specified earlier date, in which case such warranties and
representations were correct on and as of such earlier date).
Section 6.02. Offering by Lessee. The Lessee represents and
warrants that it has authorized no one to act on its behalf in connection with
the offer or sale of any interest in the Lessor's Estate or the Trust
Agreement other than First Chicago Leasing Corporation. Neither the Lessee
nor, based on representations of First Chicago Leasing Corporation, anyone
acting on its behalf has directly or indirectly offered any interest in the
Lessor's Estate or the Trust Agreement, or similar interests, for sale to, or
solicited any offer to acquire any of the same from, anyone other than the
Owner Participant and no more than 53 other accredited investors (as such term
is defined in Regulation D promulgated under the Securities Act of 1933, as
amended).
Section 6.03. Certain Covenants of Lessee. The Lessee covenants and
agrees with the Owner Participant, the Owner Trustee (in its individual
capacity and as Owner Trustee), the Pass Through Trustee (in its individual
capacity and as Pass Through Trustee) and the Indenture Trustee (in its
individual capacity and as Indenture Trustee) as follows:
(a) The Lessee will cause to be done, executed, acknowledged and
delivered at the Lessee's cost and expense all such further acts,
conveyances and assurances as the Owner Trustee, the Indenture Trustee, the
Pass Through Trustee or the Owner Participant shall reasonably require for
accomplishing the purposes of this Agreement, the Trust Agreement, the
Indenture, the Tax Indemnity Agreement, the Lease and the other Operative
Agreements to which it is a party. Without limiting the generality of this
Section 6.03(a), the Lessee will promptly take, or cause to be taken, at
the Lessee's cost and expense, such action with respect to the recording,
filing, re-recording and re-filing of the Indenture, each Indenture and
Security Agreement Supplement, the Lease, each Lease Supplement and any
financing statements or other instruments as may be necessary, or as
requested by the Indenture Trustee and appropriate, to maintain the
perfection of the first security interest and the Lien created by the
Indenture, and the Owner Trustee's title to and interest in the Aircraft
and the Lessor's Estate as against the Lessee and any third parties or if
the Lessee cannot take, or cause to be taken, such action, will furnish to
the Indenture Trustee and the Owner 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 either of them to take such
action at the Lessee's cost and expense in a timely manner.
(b) The Lessee shall maintain the certificates referred to in
Section 7.01 of the Lease and shall cause the Aircraft to remain duly
registered, in the name of the Owner Trustee, under the Transportation
Code; provided, however, that the Owner Participant, the Owner Trustee and
the Indenture Trustee agree that if at any time after December 31, 2003, so
long as no Event of Default shall have occurred and be continuing, the
Lessee has requested their consent to the registration of the Aircraft in
the name of the Owner Trustee (or, if appropriate under the laws of such
jurisdiction of reregistration, in the name of the Lessee or a sublessee as
a "lessee" or a "sublessee"), at the Lessee's expense, in a country listed
in Schedule III hereto with which the United States then maintains normal
diplomatic relations (and which is not then experiencing war or substantial
civil unrest), the Owner Participant, upon receipt by the Owner
Participant, the Owner Trustee and the Indenture Trustee of the assurances
and opinion described below, shall not unreasonably withhold their consent
to such change in registration (it being agreed, without limitation, that
the inability of the Lessee to deliver such assurances or such opinion
shall constitute reasonable grounds to withhold such consent).
As a condition to any change in the registration of the Aircraft, the
Owner Participant, the Owner Trustee in its individual and trust capacities,
and the Indenture Trustee shall have received:
(i) assurances satisfactory to them:
(A) to the effect that the insurance provisions of the Lease
have been and will be complied with and are and shall be in full
force and effect upon such change of registry;
(B) as to the continuation of the Lien of the Indenture as a
first priority, duly perfected Lien on the Aircraft;
(C) that the Owner Trustee's right, title and interest in and to
the Aircraft is recognized and fully enforceable in the new
jurisdiction of registry, that the rights of the Owner Trustee in and
to the Aircraft will not be impaired in such new jurisdiction of
registry and that the new jurisdiction of registry will give effect
to the title and registry of the Aircraft therein substantially to
the same extent as does the Government;
(D) that such new country of registry (x) would provide
substantially equivalent protection for the rights of owner
participants, lessors or lenders in similar transactions as provided
under United States law (except that, in the absence of restrictions
under the laws of such country on rights and remedies of lessors and
secured parties similar to those imposed by Sections 362 and 363 of
the Bankruptcy Code, rights and remedies similar to those available
under Section 1110 of the Bankruptcy Code shall not be required) and
(y)(i) if such change in registration is made other than in
connection with a sublease permitted under Section 7.02(a)(i) of the
Lease, imposes maintenance standards at least comparable to those of
the FAA, and (ii) if such change in registration is made in
connection with a sublease permitted under Section 7.02(a)(i) of the
Lease, imposes maintenance standards in conformity with those set
forth in Section 7.02(a)(i) of the Lease;
(E) that import and export certificates and any exchange permits
necessary to allow all Rent and other payments provided for under the
Lease, if required, shall have been procured at the Lessee's own cost
and expense by the Lessee;
(F) that the Lessee shall have effected or caused to be effected
at the Lessee's own cost and expense all recordings and filings that
are required to perfect the Lien of the Indenture;
(G) to the effect that the original indemnities (and any
additional indemnities for which the Lessee is then willing to enter
into a binding agreement to indemnify) in favor of the Owner
Participant, the Owner Trustee (in its individual capacity and as
trustee under the Trust Agreement), the Indenture Trustee (in its
individual capacity, and as trustee under the Indenture), the Pass
Through Trustee (in its individual capacity, and as trustee under the
Pass Through Agreement) and the other Indemnitees under this
Agreement, the Indenture, the Pass Through Agreement and (in the case
of the Owner Participant only) the Tax Indemnity Agreement, afford
each such party substantially the same protection as provided prior
to such change of registry;
(H) that such change will not result in the imposition of, or
increase in the amount of, any Tax (which, for this purpose, includes
the loss of any tax benefits assumed by the Owner Participant to be
available to it based upon the assumptions set forth in Section 2 of
the Tax Indemnity Agreement) for which the Lessee has not agreed to
indemnify the Owner Participant to its reasonable satisfaction, the
Indenture Trustee, the Pass Through Trustee, the Owner Trustee (or
any successor, assign or Affiliate thereof) and the Trust Estate;
(I) that any value added tax, customs duty, tariff or similar
governmental charge relating to the change in jurisdiction of
registration of the Aircraft shall have been paid in full or
adequately provided for by the Lessee to the satisfaction of the
Owner Trustee, the Indenture Trustee and the Owner Participant;
(J) of the payment by the Lessee of any reasonable fees and
expenses of the Owner Participant, the Owner Trustee, the Indenture
Trustee and the Pass Through Trustee in connection with such change
of registry, including any reasonable attorneys' fees and expenses;
(K) that duties and tariffs, if applicable, shall have been paid
for by the Lessee;
(L) as to the continuation of the Lien of the Indenture as a
first priority, duly perfected Lien on the Aircraft and the Trust
Indenture Estate, that all recordings and filings required to so
perfect the Lien of the Indenture have been duly effected, and that
no Liens (except Liens permitted under Section 6.01 of the Lease)
shall arise by reason of such registration; and
(M) that appropriate deregistration powers of attorney in favor
of the Owner Trustee and the Indenture Trustee have been executed and
delivered by the Lessee and any sublessee and, if necessary or
desirable for the effectiveness thereof, filed with the relevant
aeronautics authority; and
(ii) a favorable opinion of counsel (reasonably satisfactory to the
Owner Trustee, the Indenture Trustee and the Owner Participant) in the new
jurisdiction of registry, addressed and reasonably satisfactory to such
parties in scope, form and substance, to the effect:
(A) that the terms (including, without limitation, the governing
law, service-of-process and jurisdictional-submission provisions
thereof) of the Lease and the Indenture are legal, valid, binding and
enforceable in such jurisdiction against the Lessee, any sublessee,
the Owner Trustee and the Indenture Trustee, respectively;
(B) that it is not necessary for the Owner Participant, the Owner
Trustee, the Indenture Trustee or the Pass Through Trustee to
register or qualify to do business or meet other requirements not
already met in such jurisdiction in connection with the registration
in the new jurisdiction (and the filing and/or recordation therein of
the Indenture or Lease) and the exercise of any rights or remedies
with respect to the Aircraft pursuant to the Lease or the Indenture
or in order to maintain such registration and the Lien of the
Indenture;
(C) that the courts of such jurisdiction would provide
substantially equivalent protection to the Lessor, the Owner
Participant, the Pass Through Trustee and the Indenture Trustee as
provided under United States law (with the exception described in
paragraph (b)(i)(D)(x) of this Section 6.03) in respect of the
transactions contemplated hereby, including, without limitation, the
remedies provided in the Indenture and the Lease;
(D) that there is no tort liability of the beneficial owner,
record owner, lessor or mortgagee of an aircraft not in possession
thereof under the laws of such jurisdiction, other than tort
liability which might reasonably have been imposed on such owner,
lessor or mortgagee under the laws of the United States or any state
thereof (it being understood that, in the event such latter opinion
cannot be given in a form satisfactory to the Owner Trustee, the
Owner Participant and the Indenture Trustee, such opinion shall be
waived, if insurance reasonably satisfactory to the Owner
Participant, the Indenture Trustee and the Owner Trustee, in its
individual capacity, is provided, at the Lessee's expense, to cover
such risk and the Lessee undertakes to keep such insurance in full
force and effect);
(E) that the laws of such jurisdiction will not impair the
rights of the Lessor in and to the Aircraft or under the Lease and
(unless the Lessee shall have agreed to provide insurance reasonably
satisfactory to the Indenture Trustee and the Owner Participant
covering the risk of requisition of use of the Aircraft by the
government of registry of the Aircraft) require fair compensation by
the government of such jurisdiction payable in currency freely
convertible into United States dollars for the loss of use of the
Aircraft in the event of such requisition;
(F) that the Owner Trustee's title to the Aircraft is recognized
and fully enforceable in such jurisdiction, that such jurisdiction
will give effect to the title of the Aircraft therein substantially
to the same extent as does the Government, and that the Lien of the
Indenture shall continue as a first priority, duly perfected lien on
the Aircraft;
(G) to such further effect with respect to such other matters as
the Owner Participant, the Owner Trustee, or the Indenture Trustee may
reasonably request; and
(H) the Lien of the Indenture continues to constitute a first
priority, duly perfected Lien on the Aircraft.
(c) The Lessee shall promptly file any reports, or furnish to the
Owner Trustee and the Owner Participant such information as may be required
to enable the Owner Trustee and the Owner Participant timely to file any
reports required to be filed by the Owner Trustee as the Lessor and the
Owner Participant under the Lease with any governmental authority.
(d) The Lessee will cause the Special Aviation Counsel to file, and
where appropriate record, on the Refunding Date, the Lease, the Trust
Agreement and the Indenture. The following documents shall be filed and,
where appropriate, recorded on the Refunding Date with the Aeronautics
Authority in the following order of priority: first, the Trust Agreement,
second, the Indenture and third, the Lease with the Indenture attached
thereto.
(e) The Lessee will furnish to the Owner Participant, the Owner
Trustee and the Indenture Trustee annually after the execution of this
Agreement, by March 15 of each year, commencing with the year 1997, an
opinion, reasonably satisfactory to the Owner Participant and the Indenture
Trustee, of Special Aviation Counsel, or other counsel specified from time
to time by the Lessee acceptable to the Lessor and the Indenture Trustee:
(i) stating either (1) that in the opinion of such counsel such action has
been taken with respect to the recording, filing, re-recording and
re-filing of the Lease, the Indenture, the Trust Agreement, and any
supplements to any of them and any financing statements, continuation
statements or other instruments, and all other action has been taken, as is
necessary to maintain the Owner Trustee's title to and interest in the
Aircraft and the Lessor's Estate as against the Lessee and any third
parties and to maintain the perfection of the security interests created by
said documents and reciting the details of such action, or (2) that in the
opinion of such counsel no such action is necessary to maintain such title
or the perfection of such security interests; (ii) specifying all other
action which needs to be taken during the succeeding 14 months in order to
maintain such title and the perfection of such security interests (which
the Lessee agrees timely to take); and (iii) stating that the Owner Trustee
is the owner of legal title to the Aircraft, and the Aircraft is free and
clear of all Liens, except the security interest created by the Indenture
and such as are permitted by the Lease and the Indenture.
(f) The Lessee shall at all times maintain its corporate existence
except as permitted by Section 6.03(g) hereof and all of its rights,
privileges and franchises necessary in the normal conduct of its business,
except for any corporate right, privilege or franchise (i) that it
determines, in its reasonable, good faith business judgment, is no longer
necessary or desirable in the conduct of its business and (ii) the loss of
which will not materially adversely affect or diminish the rights of the
Holders or the Owner Participant.
(g) The Lessee shall not enter into any merger or consolidation, or
convey, transfer or lease all or substantially all of its assets as an
entirety to any Person, unless the surviving corporation or Person which
acquires by conveyance, transfer or lease all or substantially all of the
assets of the Lessee as an entirety (i) is a domestic corporation organized
and existing under the laws of the United States or a political subdivision
thereof, (ii) is a Citizen of the United States, (iii) is a U.S. Air
Carrier, (iv) expressly assumes by an instrument in writing in form and
substance satisfactory to the Owner Participant, the Indenture Trustee and
the Owner Trustee all of the Lessee's obligations hereunder and under the
other Operative Agreements, and each other document contemplated hereby or
thereby and the Lessee delivers such instrument to the Indenture Trustee,
the Owner Participant and the Owner Trustee, (v) provides an opinion from
outside counsel to the Lessee which counsel shall be reasonably
satisfactory to the Owner Participant and the Indenture Trustee and which
opinion shall be reasonably satisfactory to the Owner Participant and the
Indenture Trustee, and an officer's certificate, each stating that such
merger, consolidation, conveyance, transfer or lease and the instrument
noted in clause (iv) above comply with this Section 6.03(g), that such
instrument is a legal, valid and binding obligation of, and is enforceable
against, such survivor or Person, and that all conditions precedent herein
provided for relating to such transaction have been complied with, and (vi)
immediately after such merger, consolidation or conveyance, transfer or
lease, as the case may be, the surviving company (or Person which acquires
by conveyance, transfer or lease the assets of the Lessee) is in compliance
with all of the terms and conditions of this Agreement and the Lease and
each other Operative Agreement and each other document contemplated hereby
or thereby; provided that no such merger, consolidation or conveyance,
transfer or lease shall be permitted if the same gives rise to an Event of
Default.
Upon any consolidation or merger, or any conveyance, transfer or
lease of all or substantially all of the assets of the Lessee and the
satisfaction of the conditions specified in this Section 6.03(g), the
successor corporation formed by such consolidation or into which the Lessee
is merged or the Person to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and
power of, the Lessee under this Agreement and the Lease and each other
Operative Agreement and any other document contemplated hereby and thereby
to which the Lessee is a party with the same effect as if such successor
corporation had been named as the Lessee herein and therein. No such
conveyance, transfer or lease of all or substantially all of the assets of
the Lessee as an entirety shall have the effect of releasing the Lessee or
any successor corporation which shall theretofore have become the Lessee
hereunder in the manner prescribed in this Section 6.03(g) from its
liability hereunder or under the other Operative Agreements. Nothing
contained herein shall permit any lease, sublease, or other arrangement for
the use, operation or possession of the Aircraft except in compliance with
the applicable provisions of the Lease.
(h) The Lessee agrees to give prompt written notice to the Owner
Participant, the Owner Trustee and the Indenture Trustee of any change in
the address of its chief executive office (as such term is used in Section
9-103(3) of the Tennessee Uniform Commercial Code) or of any change in its
corporate name.
(i) The Lessee agrees to furnish to the Owner Participant, the
Lessor and the Indenture Trustee:
(A) as soon as available, but in any event within one hundred
twenty (120) days after the end of each fiscal year of the Lessee, a
consolidated balance sheet as of the end of such fiscal year, and the
related consolidated statements of income, common stockholders'
equity, retained earnings and cash flows of the Lessee for the fiscal
year then ended as prepared and certified by the Lessee's independent
certified public accountants, including their opinion;
(B) within sixty (60) days after the end of the first, second
and third quarterly accounting periods in each fiscal year of the
Lessee, a consolidated balance sheet of the Lessee prepared by it as
of the close of the accounting period then ended, together with the
related consolidated statements of income, retained earnings and cash
flows for such accounting period certified by the chief accounting
officer or a financial vice president of the Lessee;
(C) promptly upon their general transmission, copies of all
reports and statements furnished by the Lessee to its stockholders;
(D) promptly after filing with the SEC, copies of the Lessee's
Annual Reports on Form 10-K (including all corresponding annual
reports to shareholders), Quarterly Reports on Form 10-Q and, if
requested, any registration statement or prospectus filed by the
Lessee with any securities exchange or with the SEC;
(E) promptly upon (and in any event within five (5) Business
Days after) any officer of the Lessee obtaining knowledge of any
condition or event which constitutes a Default or an Event of
Default, an officer's certificate specifying the nature and period of
existence thereof and what action the Lessee has taken or is taking
or proposes to take with respect thereto;
(F) from time to time, such other financial information as the
Lessor, the Owner Participant or the Indenture Trustee may reasonably
request.
Concurrently with the delivery of the financial statements referred
to in clause (A) above, the Lessee shall deliver to the Lessor, the Owner
Participant, the Indenture Trustee and the Pass Through Trustee a certificate
of the Lessee, signed by any one of the President, the Chief Financial
Officer, the General Counsel, the Treasurer or the principal accounting
officer of the Lessee, stating that the signer, or an employee reporting to
same, is familiar with the relevant terms of this Agreement and the Lease and
the signer has reviewed, or has caused to be made under such Person's
supervision a review, of the activities of the Lessee and that, to the best of
his or her knowledge, there does not exist any Default or any Event of Default
or if a Default or an Event of Default exists or did exist, specifying the
nature thereof, the period of existence thereof and what action the Lessee has
taken or proposes to take with respect thereto.
Section 6.04. Survival of Representations and Warranties. The
representations and warranties of the Lessee provided in Sections 6.01 and 6.02
hereof and in any other Operative Agreement shall survive the Closings
hereunder and the expiration or other termination of this Agreement and the
other Operative Agreements.
ARTICLE 7
OTHER PARTIES' REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Acquisitions and Offerings of Interests in Lessor's
Estate. (a) [Intentionally Left Blank.]
(b) Owner Participant. The Owner Participant represents and
warrants that its interest in the Lessor's Estate and the Trust Agreement was
acquired by it for its own account and not with a view to resale or
distribution thereof; provided, however, that the disposition by the Owner
Participant of its interest in the Lessor's Estate and the Trust Agreement
shall, subject to the terms and provisions of Section 7.03(d) hereof, at all
times be within its control and the foregoing representation shall not limit
the Owner Participant's right to transfer or sell such interests pursuant to
the terms of this Agreement. Neither the Owner Participant nor anyone
authorized to act on its behalf has directly or indirectly offered any
interest in the Lessor's Estate or the Trust Agreement, or in any similar
security, for sale to, or solicited any offer to acquire any of the same from,
anyone. The Owner Participant further represents and warrants that neither it
nor anyone authorized to act on its behalf has made or will make any offer,
solicitation or sale of any interest in the Lessor's Estate or the Trust
Agreement in violation of the provisions of Section 5 of the Securities Act of
1933, as amended. No representation in this Section 7.01(b) shall include any
action or inaction of the Lessee, the Agent, First Chicago Leasing Corporation
or the Underwriters whether or not such action or inaction is purportedly on
behalf of the Owner Trustee, the Owner Participant or any of their Affiliates.
Section 7.02. Citizenship. (a) Generally. Each of the Owner
Trustee, in its individual capacity and as Trustee, and the Owner Participant
severally represents and warrants that it is a Citizen of the United States on
the Refunding Date. If the Owner Participant or the Owner Trustee in its
individual capacity does not comply with the requirements of this Section
7.02, the Owner Trustee, the Indenture Trustee and the Owner Participant
hereby agree that a Default or an Event of Default shall not be deemed to have
occurred and be continuing under the Lease due to non-compliance by the Lessee
with the registration requirements in the Lease occasioned by the
noncompliance of the Owner Participant or the Owner Trustee.
(b) Owner Trustee. The Owner Trustee, in its individual capacity,
covenants that if at any time it shall have actual knowledge that it has
ceased to be a Citizen of the United States, it will resign immediately as the
Owner Trustee if such citizenship is necessary under the Transportation Code
as in effect at such time or, if it is not necessary under the Transportation
Code as in effect at such time, if it is informed in writing by the Lessee or
the Owner Participant that such lack of United States citizenship would have
any adverse effect on the Lessee or the Owner Participant. The Owner Trustee,
in its individual capacity, further covenants that if at any time it appears
reasonably probable that it will cease to be a Citizen of the United States
based on information that is (i) known to a Responsible Officer or (ii)
generally known to the public, it will promptly so notify, to the extent
permitted by law, all parties to this Agreement.
(c) Owner Participant. The Owner Participant agrees, solely for the
benefit of the Lessee, the Pass Through Trustee, the Indenture Trustee and the
Owner Trustee, that if at any time when the Aircraft is registered or the
Lessee proposes to register the Aircraft in the United States (i) either it
shall cease to be, or an event which has been publicly disclosed has occurred
of which the Owner Participant has knowledge and which will cause the Owner
Participant to cease to be, a Citizen of the United States and (ii) the
Aircraft shall or would therefore become ineligible for registration in the
name of the Owner Trustee under the Transportation Code and regulations then
applicable thereunder, then the Owner Participant shall give notice thereof to
the Lessee, the Owner Trustee and the Indenture Trustee and shall (at its own
expense and without any reimbursement or indemnification from the Lessee)
immediately (and in any event within a period of 20 days) (x) effect a voting
trust or other similar arrangement, (y) transfer in accordance with the terms
of this Agreement and the Trust Agreement all its rights, title and interest
in and to such Trust Agreement, the Lessor's Estate and this Agreement, or (z)
take any other alternative action that would prevent any deregistration, or
maintain or permit the United States registration, of the Aircraft. It is
agreed that the Owner Participant shall be liable to pay promptly on request
(A) to each of the other parties hereto any actual damages (but not
consequential damages) suffered by any such other party to the extent the same
shall result from the representation and warranty of the Owner Participant in
the first sentence of Section 7.02(a) hereof proving to be untrue as of the
Refunding Date; and (B) to the Lessee, the Indenture Trustee or the Pass
Through Trustee for any damages actually (but not consequentially) incurred by
the Lessee, the Indenture Trustee and the Pass Through Trustee as a result of
the Owner Participant's failure to comply with its obligations pursuant to the
first sentence of this Section 7.02(c); provided, that, the foregoing shall
not restrict the Pass Through Trustee or the Indenture Trustee from asserting
against the Owner Participant any damages actually incurred by the holders of
any Pass Through Certificates. Each party hereto agrees, upon the request and
at the sole expense of the Owner Participant, to cooperate with the Owner
Participant in complying with its obligations under the provisions of the first
sentence of this Section 7.02(c), but without any obligation on the part of
such other party to take any action believed by it in good faith to be
unreasonably burdensome to such party or materially adverse to its business
interests.
Section 7.03. Representations, Warranties and Covenants of Owner
Participant. (a) Representations, Warranties and Covenants. In addition to
and without limiting its other representations and warranties provided for in
this Article 7, the Owner Participant represents and warrants that:
(i) it is a corporation duly incorporated and validly existing in
good standing under the laws of the State of Delaware and it has full
corporate power, authority and legal right to carry on its present business
and operations, to own or lease its Properties and to enter into and to
carry out the transactions contemplated by the Original Agreements to which
it is a party, this Agreement, the Tax Indemnity Agreement, and the Trust
Agreement;
(ii)the execution, delivery and performance by it of the Original
Agreements to which it is a party, this Agreement, the Tax Indemnity
Agreement, and the Trust Agreement have been duly authorized by all
necessary corporate action on its part and, assuming the accuracy of the
Lessee's representations in Section 6.01(o) hereof, do not require any
governmental approvals that would be required to be obtained by the Owner
Participant;
(iii) based on the representations, warranties and covenants
contained in Sections 6.01(m)(viii), 6.02 and 7.09 hereof and compliance
with Section 10.06 of the Indenture, neither the execution, delivery or
performance by the Owner Participant of the Original Agreements to which it
is a party, this Agreement, the Tax Indemnity Agreement, and the Trust
Agreement nor compliance with the terms and provisions hereof or thereof,
conflicts or will conflict with or results or will result in a breach or
violation of any of the terms, conditions or provisions of, or will require
any consent or approval under any law, governmental rule or regulation
applicable to the Owner Participant or the charter documents, as amended, or
bylaws, as amended, of the Owner Participant or any order, writ, injunction
or decree of any court or governmental authority against the Owner
Participant or by which it or any of its Properties is bound or any
indenture, mortgage or contract or other agreement or instrument to which
the Owner Participant is a party or by which it or any of its Properties is
bound, or constitutes or will constitute a default thereunder or results or
will result in the imposition of any Lien upon any of its Properties;
(iv)the Original Agreements to which it is a party, this Agreement,
the Tax Indemnity Agreement and the Trust Agreement have been or on the
Refunding Date will be duly executed and delivered by the Owner Participant
and constitute or on the Refunding Date will constitute the legal, valid
and binding obligation of the Owner Participant enforceable against it in
accordance with their terms except as such enforceability may be limited by
bankruptcy, insolvency, moratorium, reorganization or other similar laws or
equitable principles of general application to or affecting the enforcement
of creditors' rights (regardless of whether enforceability is considered in
a proceeding in equity or at law);
(v) it is not in default under any mortgage, deed of trust,
indenture, lease or other instrument or agreement to which the Owner
Participant is a party or by which it or any of its Properties may be
bound, or in violation of any applicable law, which default or violation
would have a material adverse effect on the financial condition, business
or operations of the Owner Participant or an adverse effect on the ability
of the Owner Participant to perform its obligations under the Original
Agreements to which it is a party, this Agreement and the other Operative
Agreements to which it is or is to be a party;
(vi) there are no pending or, to the knowledge of the Owner
Participant, threatened actions, suits, investigations or proceedings
against the Owner Participant before any court, administrative agency or
tribunal which are expected to materially adversely affect the ability of
the Owner Participant to perform its obligations under any of the Original
Agreements to which it is a party, this Agreement and the other Operative
Agreements to which it is or is to be a party and the Owner Participant
knows of no pending or threatened actions or proceedings before any court,
administrative agency or tribunal involving it in connection with the
transactions contemplated by the Operative Agreements;
(vii)neither the execution and delivery by it of the Original
Agreements to which it is a party, this Agreement or the other Operative
Agreements to which it is nor the performance of its obligations hereunder
or thereunder requires the consent or approval of or the giving of notice
to, the registration with, or the taking of any other action in respect of,
any governmental authority or agency that would be required to be obtained
or taken by the Owner Participant except for filings contemplated by this
Agreement;
(viii) no part of the funds to be used by it to acquire the interests
to be acquired by the Owner Participant under this Agreement constitutes
assets (within the meaning of ERISA and any applicable rules and
regulations) of any employee benefit plan subject to Title I of ERISA or of
any plan or individual retirement account subject to Section 4975 of the
Code;
(ix)it is a "U.S. Person" as defined in Section 7701(a)(30) of the
Code and is not a tax resident of another country;
(x) it has a consolidated tangible net worth of not less than
$75,000,000; and
(xi) the representations and warranties of the Owner Participant set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier date).
Notwithstanding the foregoing or anything else contained in this
Agreement, the Owner Participant makes no representation or warranty in this
Agreement with respect to laws, rules or regulations relating to aviation or
to the nature or use of the equipment owned by the Owner Trustee, including,
without limitation, the airworthiness, value, condition, workmanship, design,
patent or trademark infringement, operation, merchantability or fitness for
use of the Aircraft, other than such laws, rules or regulations relating to
the citizenship requirements of the Owner Participant under applicable
aviation law.
(b) Lessor's Liens. The Owner Participant further represents,
warrants and covenants that there are no Lessor's Liens attributable to it (or
an Affiliate thereof) against, on or with respect to the Aircraft or the
Lessor's Estate or the Trust Indenture Estate, and that there will not be any
Lessor's Lien attributable to it (or an Affiliate thereof) against, on or with
respect to the Aircraft or the Lessor's Estate or the Trust Indenture Estate
attributable to it (or an Affiliate thereof) on the Refunding Date. The Owner
Participant agrees with and for the benefit of the Lessee, the Owner Trustee,
the Indenture Trustee and the Pass Through Trustee that the Owner Participant
will, at its own cost and expense, take such action as may be necessary (by
bonding or otherwise, so long as neither the Lessee's operation and use of the
Aircraft nor the validity and priority of the Lien of the Indenture is
impaired) to duly discharge and satisfy in full, promptly after the same first
becomes known to the Owner Participant, any Lessor's Lien against, on or with
respect to the Aircraft or the Lessor's Estate or the Trust Indenture Estate
attributable to the Owner Participant (or an Affiliate thereof), provided,
however, that the Owner Participant shall not be required to discharge or
satisfy such Lessor's Lien which is being contested by the Owner Participant
in good faith and by appropriate proceedings so long as such proceedings do
not involve any material danger of the sale, forfeiture or loss of the
Aircraft or the Lessor's Estate or the Trust Indenture Estate or any interest
in any thereof or otherwise materially adversely affect the validity or
priority of the Lien of the Indenture.
(c) Reimbursement. Without limiting any other rights the parties
hereto may have as a result of any breach by the Owner Participant of its
obligations in Section 7.03(b) hereof, the Owner Participant agrees to
reimburse each other party hereto for all reasonable legal fees and expenses
of counsel that may be incurred by any such party as a result of the failure
of the Owner Participant to discharge and satisfy any such Lessor's Lien in
accordance with the terms of Section 7.03(b) hereof.
(d) Assignment of Interests of Owner Participant. At any time after
all obligations of the Owner Participant under Section 2.01(d) hereof have
been satisfied in full, and subject to the conditions set forth in this
Section 7.03(d), the Owner Participant may assign, convey or otherwise
transfer to a single institutional investor or an Affiliate of an
institutional investor all (but not less than all) of the Beneficial Interest,
provided that it gives the Lessee and the Indenture Trustee at least 10
Business Days' notice of such assignment, conveyance or other transfer and
provided further that the Owner Participant and any Owner Participant
Guarantor shall remain liable for all obligations of the Owner Participant
under the Trust Agreement and the Operative Agreements to which the Owner
Participant is a party to the extent (but only to the extent) relating to the
period on or before the date of such transfer and provided that the transferee
agrees by a written instrument substantially in the form attached hereto as
Exhibit E-1 to assume primary liability for all obligations as an Owner
Participant under the Trust Agreement and the other Operative Agreements to
which such Owner Participant is a party relating to the period after the date
of transfer.
Any such transferee shall (a) be (i) a bank, savings institution,
finance company, leasing company or trust company, national banking
association acting for its own account or in a fiduciary capacity as trustee
or agent under any pension, retirement, profit sharing or similar trust or
fund, insurance company, fraternal benefit society or corporation acting for
its own account having a combined capital and surplus (or, if applicable,
consolidated tangible net worth or its equivalent) of not less than
$75,000,000, (ii) a subsidiary of any Person described in clause (i) where such
Person provides (A) support for the obligations assumed by such transferee
subsidiary reasonably satisfactory to the Lessee, the Owner Trustee and the
Indenture Trustee or (B) an unconditional guaranty substantially in the form
of Exhibit E-2 attached hereto of such transferee subsidiary's obligations, or
(iii) an Affiliate of the transferring Owner Participant, so long as such
Affiliate has a combined capital and surplus (or, if applicable, consolidated
tangible net worth or its equivalent) of not less than $75,000,000, (b) be
legally capable of binding itself to the obligations of the Owner Participant
and shall expressly agree to assume all obligations of the Owner Participant
under the Trust Agreement and this Agreement and (c) provide representations
substantially similar to those contained in Sections 7.02(a) and 7.03(a)
hereof. In the event of any such assignment, conveyance or transfer, the
transferee shall become a party to the Trust Agreement and shall agree to be
bound by all the terms of and will undertake all of the obligations of the
Owner Participant contained in the Trust Agreement and the other Operative
Agreements in the manner set forth in the form attached as Exhibit E-1.
A transferee hereunder shall be (i) a "U.S. Person" as defined in
Section 7701(a)(30) of the Code (or any successor provision thereto) and (B)
such transferee shall be personally liable for any debt service to the extent
that its receipt of rentals is reduced by reason of any withholding Taxes that
result from such transferee's failure to be such a "U.S. Person" and (ii) a
Citizen of the United States or has established a voting trust, voting powers
or other arrangement reasonably satisfactory to the Indenture Trustee and the
Lessee to permit the Owner Trustee to be the registered owner of the Aircraft
under the Transportation Code. A transferee hereunder shall not be, and in
acquiring the Beneficial Interest shall not use the assets of, an employee
benefit plan subject to Title I of ERISA or an individual retirement account
or a plan subject to Section 4975 of the Code. Assuming the truth of the
representations made in Sections 6.01(m) and 7.06 hereof and compliance with
Section 10.06 of the Indenture, no such assignment, conveyance or transfer
shall violate any provision of law or regulation or create a relationship
which would be in violation thereof. The Owner Trustee shall not be on notice
of or otherwise bound by any such assignment, conveyance or transfer unless
and until it shall have received an executed counterpart of the instrument of
such assignment, conveyance or transfer. Upon any such disposition by the
Owner Participant to a transferee as above provided, the transferee shall be
deemed the "Owner Participant" or "Trustor" for all purposes of the Operative
Agreements, and shall be deemed to have made all the payments previously made
by its transferor and to have acquired the same interest in the Lessor's
Estate as theretofore held by its transferor; and each reference therein to
the "Owner Participant" or "Trustor" shall thereafter be deemed a reference to
such transferee.
Notwithstanding anything to the contrary contained in this Section
7.03(d), in no event shall the Owner Participant transfer its interest in the
Beneficial Interest to any entity whose business is that of a nationwide or
worldwide overnight or expedited delivery small package air courier, cargo or
freight deliverer or which competes with the Lessee in such lines of business.
The Lessee agrees that it will reasonably cooperate with the Owner Participant
in effecting an assignment of the Owner Participant's interests including,
without limitation, providing letters to any successor Owner Participant
permitting such successor Owner Participant to rely on any opinions provided
by the Lessee on the Delivery Date.
(e) Actions with Respect to Lessor's Estate, Etc. The Owner
Participant agrees that it will not take any action to subject the Lessor's
Estate or the trust established by the Trust Agreement, as debtor, to the
reorganization or liquidation provisions of the Bankruptcy Code or any other
applicable bankruptcy or insolvency statute.
Section 7.04. Representations, Covenants and Warranties of FSB and
the Owner Trustee. (a) In addition to and without limiting its other
representations and warranties provided for in this Article 7, FSB represents
and warrants, in its individual capacity with respect to items (i), (ii),
(iii)(A), (iv), (v), (vi) and (vii) below, and as the Owner Trustee with
respect to items (iii)(B) and (iv) that:
(i)it is a national banking association duly organized and validly
existing in good standing under the laws of the United States of America
with its principal place of business and chief executive office (as such
terms are used in Article 9 of the Uniform Commercial Code) at ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇, Attention: Corporate Trust
Department and has full corporate power and authority, in its individual
capacity or (assuming the Trust Agreement has been duly authorized,
executed and delivered by the Owner Participant) as the Owner Trustee, as
the case may be, to carry on its business as now conducted, and to
execute, deliver and perform this Agreement, the Original Agreements to
which it is a party and the Operative Agreements to which it is or is to be
a party;
(ii)the execution, delivery and performance by FSB, either in its
individual capacity or as the Owner Trustee, as the case may be, of this
Agreement, the Original Agreements and the Operative Agreements to which it
is or is to be party have been duly authorized by all necessary corporate
action on its part, and do not contravene its certificate of incorporation
or by-laws; each of this Agreement, the Original Agreements and the other
Operative Agreements to which it is or is to be a party has been duly
authorized, executed and delivered by FSB, either in its individual
capacity or as the Owner Trustee, as the case may be, and neither the
execution and delivery thereof nor FSB's performance of or compliance with
any of the terms and provisions thereof will violate any Federal or state
or local law or regulation governing FSB's banking or trust powers;
(iii)(A) assuming due authorization, execution and delivery by each
other party thereto, each of the Operative Agreements to which it is or is
to be party when duly executed and delivered will, and each of the Original
Agreements to which it is a party does, to the extent each such document is
entered into by FSB in its individual capacity, constitute the legal, valid
and binding obligation of FSB in its individual capacity enforceable
against it in such capacity in accordance with its respective terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and the performance by FSB in its individual capacity of
any of its obligations thereunder does not contravene any lease, regulation
or contractual restriction binding on FSB in its individual capacity;
(B) assuming due authorization, execution and delivery by each other
party thereto, each of the Operative Agreements to which it is or is to be
party when duly executed and delivered will, and each of the Original
Agreements to which it is a party does, to the extent each such document is
entered into by the Owner Trustee in its trust capacity, constitute the
legal, valid and binding obligation of the Owner Trustee enforceable
against it in such capacity in accordance with its respective terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights
(regardless of whether enforceability is considered in a proceeding in
equity or at law), and the performance by the Owner Trustee of any of its
obligations thereunder does not contravene any lease, regulation or
contractual restriction binding on the Owner Trustee;
(iv)there are no pending or, to its knowledge, threatened actions or
proceedings against FSB before any court or administrative agency which
would materially and adversely affect the ability of FSB, either in its
individual capacity or as the Owner Trustee, as the case may be, to perform
its obligations under the Operative Agreements to which it is or is to be
party;
(v) it shall give the Lessee, the Indenture Trustee and the Owner
Participant at least thirty (30) days' prior written notice in the event of
any change in its chief executive office or name;
(vi)neither the execution and delivery by it, either in its
individual capacity or as the Owner Trustee, as the case may be, of any of
the Original Agreements and the Operative Agreements to which it is or is
to be a party, requires on the part of FSB in its individual capacity or
any of its Affiliates the consent or approval of or the giving of notice
to, the registration with, or the taking of any other action in respect of,
any Federal or Utah governmental authority or agency governing its banking
or trust powers;
(vii)on the Refunding Date the Owner Trustee be holding whatever
title to the Aircraft as was conveyed to it by AVSA on the Delivery Date,
the Aircraft shall be free of Lessor's Liens attributable to FSB in its
individual capacity and FSB in its individual capacity and as Owner Trustee
is a Citizen of the United States; and
(viii) the representations and warranties of the Owner Trustee set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier date).
(b) Lessor's Liens. FSB, in its individual capacity, further
represents, warrants and covenants that there are no Lessor's Liens
attributable to it in its individual capacity against, on or with respect to
the Aircraft or the Lessor's Estate or the Trust Indenture Estate, and that
there will not be any such Lessor's Liens against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate on the Refunding
Date. The Owner Trustee, in its trust capacity, and at the cost and expense of
the Lessee, covenants that it will in its trust capacity promptly, and in any
event within 30 days after the same shall first become known to it, take such
action as may be necessary to discharge duly any Lessor's Liens attributable
to it in its trust capacity. FSB, in its individual capacity, covenants and
agrees that it will at its own expense take such action as may be necessary to
duly discharge and satisfy in full, promptly, and in any event within 30 days
after the same shall first become known to it, any Lessor's Liens against, on
or with respect to the Aircraft or the Lessor's Estate or the Trust Indenture
Estate attributable to it in its individual capacity or the consolidated group
of taxpayers of which it (in such capacity) is a part which may arise at any
time after the date of this Agreement.
(c) Indemnity for Lessor's Liens. FSB, in its individual capacity,
agrees to indemnify and hold harmless the Lessee, the Indenture Trustee, the
Owner Participant and the Pass Through Trustee and the Owner Trustee from and
against any loss, cost, expense or damage which may be suffered by the Lessee,
the Indenture Trustee, the Owner Participant, the Pass Through Trustee or the
Owner Trustee as a result of the failure of FSB to discharge and satisfy any
Lessor's Liens attributable to it in its individual capacity, as described in
Section 7.04(b) hereof.
(d) Securities Act. None of FSB, the Owner Trustee or any Person
authorized by either of them to act on its behalf has directly or indirectly
offered or sold or will directly or indirectly offer or sell any interest in
the Lessor's Estate, or in any similar security relating to the Lessor's
Estate, or in any security the offering of which for purposes of the
Securities Act of 1933, as amended, would be deemed to be part of the same
offering as the offering of the aforementioned securities to, or solicited any
offer to acquire any of the same from, any Person.
Section 7.05. Representations, Warranties and Covenants of the
Indenture Trustee. (a) The Indenture Trustee in its individual capacity (other
than as the Pass Through Trustee) represents as follows:
(i) it is a Massachusetts trust company duly organized and validly
existing in good standing under the laws of the Commonwealth of
Massachusetts and has the power and authority to enter into and perform its
obligations under the Indenture, this Agreement and the Original Agreements
to which it is a party and to authenticate the Certificates to be delivered
on the Refunding Date;
(ii)the Indenture and this Agreement, the Original Agreements to
which it is a party and the other Operative Agreements to which it is or is
to be a party, and the authentication of the Certificates to be delivered
on the Refunding Date, have been duly authorized by all necessary corporate
action on its part, and neither the execution and delivery thereof nor its
performance of any of the terms and provisions thereof will violate any
Federal or Massachusetts law or regulation relating to its banking or trust
powers or contravene or result in any breach of, or constitute any default
under, its articles of association or by-laws;
(iii)each of the Indenture and this Agreement, the Original
Agreements to which it is a party and the other Operative Agreements to
which it is or is to be a party, has been duly executed and delivered by it
and, assuming that each such agreement is the legal, valid and binding
obligation of each other party thereto, is the legal, valid and binding
obligation of the Indenture Trustee, enforceable against the Indenture
Trustee in accordance with its terms except as such enforceability may be
limited by bankruptcy, insolvency, reorganization or other similar laws or
equitable principles of general application to or affecting the enforcement
of creditors' rights (regardless of whether enforceability is considered in
a proceeding in equity or at law);
(iv)neither the execution and delivery by it of the Indenture and this
Agreement, the Original Agreements to which it is a party and the other
Operative Agreements to which it is or is to be a party, nor the
performance by it of any of the transactions contemplated hereby or
thereby, requires the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any
Federal or state governmental authority or agency governing its banking and
trust powers;
(v) the representations and warranties of the Indenture Trustee set
forth in the Original Agreements to which it is a party were correct on and
as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
warranties and representations were correct on and as of such earlier
date); and
(vi)the Indenture Trustee holds the original counterparts of the
Original Lease, the Lease Supplement, Ancillary Agreement I and AVSA's
Warranty ▇▇▇▇ of Sale.
(b) Indenture Trustee's Liens. The Indenture Trustee, in its
individual capacity, further represents, warrants and covenants that there are
no Indenture Trustee's Liens attributable to it in its individual capacity
against, on or with respect to the Aircraft or the Lessor's Estate or the
Trust Indenture Estate, and that there will not be any Indenture Trustee's
Liens against, on or with respect to the Aircraft or the Lessor's Estate or
the Trust Indenture Estate on the Refunding Date. The Indenture Trustee, in
its individual capacity, covenants and agrees that it will at its own expense
take such action as may be necessary to duly discharge and satisfy in full,
promptly, and in any event within 30 days, after the same shall first become
known to it, any Indenture Trustee's Liens against, on or with respect to the
Aircraft or the Lessor's Estate or the Trust Indenture Estate.
(c) Indemnity for Indenture Trustee's Liens. The Indenture Trustee,
in its individual capacity, agrees to indemnify and hold harmless the Lessee,
the Owner Participant, the Owner Trustee and the Pass Through Trustee from and
against any loss, cost, expense or damage which may be suffered by the Lessee,
the Indenture Trustee, the Owner Participant, the Owner Trustee or the Pass
Through Trustee as a result of the failure of the Indenture Trustee to
discharge and satisfy any Indenture Trustee's Liens attributable to it in its
individual capacity, as described in Section 7.05(b) hereof.
Section 7.06. Indenture Trustee's Notice of Default. The Indenture
Trustee agrees to give the Owner Participant notice of any Default or Event of
Default promptly upon a Responsible Officer of the Indenture Trustee having
actual knowledge thereof.
Section 7.07. Releases from Indenture. The Indenture Trustee
covenants and agrees, for the benefit of the Lessee and the Owner Participant,
to execute and deliver the instruments of release from the Lien of the
Indenture which it is required to execute and deliver in accordance with the
provisions of Article XIV of the Indenture, and the Owner Participant agrees,
for the benefit of the Lessee, to cause the Owner Trustee to request the
Indenture Trustee to execute and deliver such instruments of release upon
written notice from the Lessee to make such request.
Section 7.08. Covenant of Quiet Enjoyment. The Owner Participant,
the Indenture Trustee, the Pass Through Trustee and the Owner Trustee
covenants and agrees as to itself only that, so long as no Event of Default
under the Lease has occurred and is continuing, neither the Owner Participant
(or the Owner Trustee, the Pass Through Trustee or the Indenture Trustee, as
the case may be) nor any Person lawfully claiming through the Owner
Participant (or the Owner Trustee, the Pass Through Trustee or the Indenture
Trustee, as the case may be) shall interfere with the Lessee's right quietly
to enjoy the Aircraft during the Term without hindrance or disturbance by the
Owner Participant (or the Owner Trustee, the Pass Through Trustee or the
Indenture Trustee, as the case may be).
Section 7.09. Original Loan Participants' and Pass Through Trustee's
Representations and Warranties. (a) Each Original Loan Participant
represents and warrants that the representations and warranties made by it in
Sections 7.01(a) and 7.06 of the Original Participation Agreement were correct
on and as of the Delivery Date (except to the extent such representations
expressly related solely to a specified earlier date, in which case such
representations and warranties were correct on and as of such earlier date).
(b) The Pass Through Trustee, in its individual capacity (except
with respect to clause (iii) below), represents and warrants as of the date
hereof (except as otherwise provided), as of the Pass Through Closing Date and
as of the Refunding Date that:
(i) it is a Massachusetts trust company duly organized and validly
existing in good standing under the laws of the Commonwealth of
Massachusetts and has the power and authority to enter into and perform its
obligations under the Pass Through Agreement, the Series Supplements and
this Agreement and to execute and authenticate the Pass Through
Certificates to be delivered on the Pass Through Closing Date;
(ii)the execution, delivery and performance of this Agreement, the
Pass Through Agreement and the Series Supplements and the performance of its
obligations hereunder and thereunder (including the execution and
authentication of the Pass Through Certificates to be delivered on the Pass
Through Closing Date) have been fully authorized by all necessary corporate
action on its part, and, subject to (A) the registration of the issuance
and sale of the Pass Through Certificates under the Securities Act, (B)
compliance with any applicable state securities laws and (C) the
qualification of the Pass Through Agreement under the Trust Indenture Act,
neither the execution and delivery thereof nor its performance of any of
the terms and provisions thereof will violate any Federal or Massachusetts
law or regulation relating to its banking or trust powers or contravene or
result in any breach of, or constitute any default under its articles of
association, or bylaws or the provisions of any indenture, mortgage,
contract or other agreement to which it is a party or by which it or its
properties may be bound or affected; and
(iii)each of this Agreement and the Pass Through Agreement has been,
and as of the Pass Through Closing Date the Series Supplements will be,
duly executed and delivered by it (in its individual and trust capacities)
and, assuming that each such agreement is the legal, valid and binding
obligation of each other party thereto, is or will be, as the case may be,
the legal, valid and binding obligation of the Pass Through Trustee (in its
individual and trust capacities), enforceable in accordance with its
respective terms except as limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws or equitable principles of general
application to or affecting the enforcement of creditors' rights generally
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
Section 7.10. Survival of Representations, Warranties and Covenants.
The representations, warranties and covenants of the Owner Participant, the
Owner Trustee, the Pass Through Trustee and the Indenture Trustee provided for
in this Article 7, and their respective obligations under any and all of them,
shall survive the Closings and the expiration or other termination of this
Agreement, and the other Operative Agreements.
Section 7.11. Lessee's Assumption of the Certificates. (a) Subject
to compliance by the Lessee with all of its obligations under the Operative
Agreements, each of the Owner Participant, the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Lessee covenants and agrees that if
the Lessee elects to terminate the Lease and to purchase the Aircraft pursuant
to Section 4.02(a)(A), (D) or (E) of the Lease, and so long as no Event of
Default shall have occurred and be continuing then, upon compliance with the
applicable provisions of said Section 4.02(a) of the Lease, the Owner Trustee
will transfer to the Lessee, without recourse or warranty (except as to the
absence of Lessor's Liens attributable to the Owner Trustee) but subject to
the Lien of the Indenture, all of the Owner Trustee's right, title and
interest in and to the Aircraft, and if the Lessee, in connection with such
purchase, elects pursuant to Section 4.02(a)(A), (D) or (E) of the Lease to
assume the obligations of the Owner Trustee to the Indenture Trustee and the
Holders under the Indenture, the Certificates and hereunder, then the Lessee
shall so notify the Indenture Trustee (such notice to be given at least 30 and
not more than 60 days prior to the effective date of such assumption), and
each of the parties shall execute and deliver appropriate documentation
permitting the Lessee to assume such obligations on the basis of full recourse
to the Lessee, maintaining for the benefit of the Holders the security
interest in the Aircraft created by the Indenture, and upon compliance with the
provisions of this Section 7.11 releasing the Owner Participant and the Owner
Trustee from all obligations in respect of the Certificates, the Indenture,
this Agreement and the other Operative Agreements, except any obligations
relating to the period prior to such assumption and take all such other
actions, at the Lessee's expense, as are reasonably necessary to permit such
assumption by the Lessee.
(b) In connection with such assumption:
(i) the Lessee shall execute and deliver an instrument satisfactory
in form and substance to the Indenture Trustee (A) pursuant to which the
Lessee irrevocably and unconditionally assumes and undertakes, with full
recourse to the Lessee, to pay, satisfy and discharge when and as due (at
the stated maturity thereof, by acceleration or otherwise) the principal
of, Make-Whole Premium, if any, interest and all other sums owing on all
Outstanding Certificates (or on the Lessee's substituted obligations) in
accordance with their terms and to punctually perform and observe all of
the covenants and obligations hereunder and under the Indenture and the
Certificates (as the same may be amended in connection with such
assumption) to be performed or observed by the Owner Trustee and (B) which
contains amendments to the Indenture, in form and substance satisfactory to
the Holders and the Indenture Trustee, that incorporate therein such
provisions from the Lease and this Agreement as may be appropriate,
including, without limitation, events of default substantially identical in
scope and effect to those set forth in the Lease and covenants
substantially identical to the covenants of the Lessee hereunder and under
the Lease;
(ii) the instrument referred to in paragraph (i) of this Section
7.11(b), any Uniform Commercial Code financing statements relating thereto,
and any other documents which shall be necessary (or reasonably requested
by the Indenture Trustee) to establish the Lessee's title to and interest
in the Aircraft or to reflect the substitution of the Lessee for the Owner
Trustee under the Operative Agreements or to continue the perfection of the
security interests in the Aircraft and the other rights, Property and
interests included in the Trust Indenture Estate for the benefit of the
Holders (or the Lessee's substituted obligations) shall be filed in such
form, manner and places as are necessary or, in the reasonable opinion of
the Indenture Trustee, advisable for such purpose;
(iii) the Indenture Trustee shall have received an insurance report
dated the effective date of such assumption of an independent insurance
broker and certificates of insurance, each in form and substance
satisfactory to the Indenture Trustee, as to the due compliance as of the
effective date of such assumption with the terms of Article 13 of the Lease
(as it relates to the Indenture Trustee) relating to the insurance with
respect to the Aircraft;
(iv) the Indenture Trustee shall have received evidence that as of
the effectiveness of the assignment on the date of such assumption the
Aircraft is free and clear of all Liens other than the Lien of the
Indenture and other Permitted Liens;
(v) the Indenture Trustee shall have received a certificate from the
Lessee that no Event of Default shall have occurred and be continuing as of
the effective date of such assumption; and
(vi) the Indenture Trustee shall have received (A) from counsel for
the Lessee (who may be the Lessee's General Counsel) a legal opinion, in
form and substance satisfactory to the Indenture Trustee (w) with respect
to the compliance of the assumption contemplated hereby with the terms,
provisions and conditions hereof, (x) with respect to the due
authorization, execution, delivery, validity and enforceability of the
instrument referred to in paragraph (i) of this Section 7.11(b), (y) with
respect to the continued perfection of the first and prior Lien and security
interest in the Aircraft for the benefit of the Holders of the Certificates
(or the Lessee's substituted obligations) referred to in paragraph (ii) of
this Section 7.11(b) and (z) with respect to the continued availability of
the benefits of Section 1110 of the Bankruptcy Code to the Indenture
Trustee for the benefit of the Holders with respect to the Aircraft after
giving effect to such assumption, (B) from counsel to the Indenture Trustee
and Special Aviation Counsel, a legal opinion comparable to the respective
opinions delivered on the Delivery Date with such changes therein as may be
appropriate in light of such assumption, and (C) in the case of each opinion
described in clause (A) or (B) above, covering such additional matters as
the Indenture Trustee shall reasonably request.
(c) The Lessee shall pay all reasonable expenses (including
reasonable fees and expenses of counsel) of the Indenture Trustee, the Owner
Trustee, the Pass Through Trustee and the Owner Participant in connection with
such assumption.
Section 7.12. Indebtedness of Owner Trustee. So long as the
Indenture is in effect, the Owner Trustee, not in its individual capacity, but
solely as trustee under the Trust Agreement, shall not incur any indebtedness
for borrowed money except as expressly contemplated herein or in any other
Operative Agreement (excluding the Tax Indemnity Agreement) and shall not
engage in any business or other activity other than the transactions
contemplated herein or in any other Operative Agreement (excluding the Tax
Indemnity Agreement) and all necessary or appropriate activity related thereto.
Section 7.13. Compliance with Trust Agreement, Etc. Each of the
Owner Participant, FSB and the Owner Trustee agrees with the Lessee, the
Indenture Trustee and the Pass Through Trustee that so long as the Lien of the
Indenture shall be in effect it will (i) comply with all of the terms of the
Trust Agreement applicable to it in its respective capacity, the noncompliance
with which would materially adversely affect any such party and (ii) not take
any action, or cause any action to be taken, to amend, modify or supplement
any other provision of the Trust Agreement in a manner that would materially
adversely affect any such party without the prior written consent of such
party. The Owner Trustee confirms for the benefit of the Lessee, the
Indenture Trustee and the Pass Through Trustee that it will comply with the
provisions of Article 2 of the Trust Agreement. Notwithstanding anything else
to the contrary in the Trust Agreement, so long as the Lease remains in
effect, the Owner Participant agrees not to terminate or revoke the trust
created by the Trust Agreement without the consent of the Lessee. If and so
long as the Indenture shall not have been discharged the consent of the
Indenture Trustee shall also be required prior to any termination or
revocation of such trust and in addition, the Owner Participant will, at the
Lessee's expense, promptly and duly execute and deliver to the Indenture
Trustee such documents and assurances including, without limitation,
conveyances, financing statements and continuation statements with respect to
financing statements and take such further action as the Indenture Trustee may
from time to time reasonably request and furnish in order to protect the
rights and remedies created or intended to be created in favor of the
Indenture Trustee under the Indenture and to create for the benefit of the
Certificate Holders a valid first priority Lien with respect to, and a first
and prior perfected security interest in, the Trust Indenture Estate.
ARTICLE 8
TAXES
Section 8.01. Lessee's Obligation to Pay Taxes. (a) Generally. The
Lessee agrees promptly to pay when due, and to indemnify and hold each
Indemnitee harmless from all license, recording, documentary, registration and
other fees and all taxes (including, without limitation, income, gross
receipts, sales, rental, use, value added, property (tangible and intangible),
ad valorem, excise and stamp taxes), fees, levies, imposts, recording duties,
duties, charges, assessments or withholdings of any nature whatsoever,
together with any assessments, penalties, fines, additions to tax or interest
thereon (individually, a "Tax," and collectively called "Taxes"), however
imposed or asserted (whether imposed upon any Indemnitee, the Lessee, all or
any part of the Aircraft, Airframe, any Engine or any Part or the Lessor's
Estate, the Trust Indenture Estate, Rent, the Certificates or otherwise upon
or with respect to any Operative Agreement or Original Agreement, any payments
thereunder or otherwise in connection therewith), by any Federal, state or
local government or taxing authority in the United States, or by any
government or taxing authority of a foreign country or of any political
subdivision or taxing authority thereof or by a territory or possession of the
United States or an international taxing authority relating to or measured by:
(i) the construction, mortgaging, financing, refinancing, purchase,
acceptance, rejection, delivery, nondelivery, transport, location, ownership,
registration, reregistration, deregistration, insuring, assembly, possession,
repossession, operation, use, non-use, condition, maintenance, repair,
improvement, conversion, sale, return, abandonment, preparation, installation,
storage, redelivery, replacement, manufacture, leasing, subleasing,
sub-subleasing, modification, alteration, rebuilding, importation, transfer of
title, transfer of registration, exportation or other application or
disposition of, or the imposition of any Lien (or the incurrence of any
liability to refund or pay over any amount as a result of any Lien) on, the
Aircraft, the Airframe, any Engine or any Part or any interest therein;
(ii) amounts payable under the Operative Agreements or Original
Agreements;
(iii) the Property, or the income or other proceeds received with
respect to the Property attributable to the transactions contemplated by
the Operative Agreements or the Original Agreements, held by the Owner
Trustee under the Trust Agreement or after an Event of Default under the
Lease, or by the Indenture Trustee under the Indenture;
(iv) otherwise with respect to any Operative Agreement or Original
Agreement, any interest therein or by reason of the transactions described
in or contemplated by the Operative Agreements or the Original Agreements;
(v) the principal or interest or other amounts payable with respect
to the Original Loan Certificates, the Pass Through Certificates or the
Certificates;
(vi) the Original Loan Certificates, the Pass Through Certificates or
the Certificates or the issuance, sale, acquisition, reoptimization, or
refinancing thereof or the beneficial interests in the Trust Estate or the
Trust Indenture Estate or the creation thereof under the Trust Agreement or
the Indenture, or the security interest created or perfected thereby or by
any filing thereof;
(vii) any assumption by the Lessee pursuant to Section 7.11 of this
Agreement and Section 2.12 of the Indenture;
(viii) the Aircraft, the Airframe, any Engine or any Part; or
(ix) the rentals (including Basic Rent, Renewal Rent and Supplemental
Rent), receipts or earnings arising from the Operative Agreements or the
Original Agreements.
(b) Exceptions. The indemnity provided for in Section 8.01(a) shall
not extend to any of the following:
(i) With respect to an Indemnitee other than an Original Loan
Participant, Taxes based upon, measured by or with respect to the net or
gross income, items of tax preference or minimum tax or excess profits,
receipts, value-added taxes, capital, franchise, net worth (whether
denominated income, excise, capital stock, or doing business taxes) or
other similarly-based taxes (other than sales, use, transfer, rental, ad
valorem, stamp, property, or similar taxes) ("Income Taxes"), provided,
however, that this clause (i) shall not exclude from the indemnity
described in Section 8.01(a) above any such Income Taxes to the extent such
taxes are imposed by any jurisdiction in which the Indemnitee would not be
subject to such taxes but for, or would be subject to such taxes solely as
a result of, (x) the operation, registration, location, presence, or use of
the Aircraft, Airframe, any Engine or any Part thereof, in such
jurisdiction or (y) the place of incorporation or principal office or the
activities of the Lessee or any sublessee in such jurisdiction (it being
understood that (A) any such indemnity would be payable only to the extent
of the net harm incurred by the Indemnitee from such Income Taxes, taking
into account any incremental current Tax benefit in another tax
jurisdiction resulting from payment of such Income Taxes and (B) this
sentence would require indemnification in a jurisdiction in which the
Indemnitee is already subject to an Income Tax (an "Existing Income Tax")
only if an event set forth in Clause (x) or (y) of this sentence causes the
Indemnitee to be subject to an Income Tax in that jurisdiction (a "New
Income Tax") other than an Existing Income Tax, and such New Income Tax
would have been imposed even if the activities contemplated by the
Operative Agreements or the Original Agreements were the Indemnitee's sole
nexus to the jurisdiction); provided, further, that the provisions of this
paragraph (b)(i) relating to Income Taxes shall not exclude from the
indemnity described in Section 8.01(a) hereof any Income Taxes for which
the Lessee would be required to indemnify an Indemnitee (x) so that any
payment under the Operative Agreements or the Original Agreements,
otherwise required to be made on an After-Tax Basis, is made on an
After-Tax Basis or (y) pursuant to the last sentence of Section 8.02, 8.05,
9.02 or 9.05 of this Agreement;
(ii)With respect to an Original Loan Participant, Income Taxes (other
than in the case of a Non-U.S. Person, U.S. federal withholding taxes on
amounts payable with respect to such Original Loan Participant's Loan
Certificate) except to the extent such Income Tax is imposed (including by
way of increase) by any jurisdiction in which the Indemnitee is subject to
tax (A) on or with respect to any gain resulting from the assumption of any
Loan Certificate by the Lessee, (B) as a result of the operation,
registration, location, presence, basing or use of the Aircraft, Airframe,
any Engine or any Part thereof, in such jurisdiction (it being understood
that (I) the incremental Income Taxes described in this clause (B) shall
not include any U.S. Federal income taxes and (II) that to the extent such
incremental Income Taxes give rise to any incremental current Tax benefit in
another tax jurisdiction, that such incremental benefit shall offset and
decrease the incremental Income Taxes determined under this clause (B)) or
(C) solely as a result of the place of incorporation, principal office,
corporate domicile or the activities of the Lessor, Owner Participant, the
Owner Trustee, the Indenture Trustee, the Lessee or any sublessee in such
jurisdiction (it being understood that to the extent that any Income Taxes
described under this clause (C) give rise to any incremental current Tax
benefit in another tax jurisdiction or another tax period, that such
incremental Tax benefit shall offset and decrease the Income Taxes
determined under this clause (C)); provided, however, that the provisions
of this paragraph (b)(ii) relating to Income Taxes shall not exclude from
the indemnity described in Section 8.01(a) any Income Taxes for which the
Lessee would be required to indemnify an Indemnitee (x) so that any payment
under the Operative Agreements, otherwise required to be made on an
After-Tax Basis, is made on an After-Tax Basis or (y) pursuant to the last
sentence of Section 8.02 of this Agreement;
(iii)Taxes imposed with respect to the Aircraft and arising out of or
measured by acts, omissions, events or periods (or any combination of the
foregoing) which occur after the later of (A) the payment in full of all
amounts payable by the Lessee pursuant to and in accordance with the
Operative Agreements, or the earlier discharge in full of the Lessee's
payment obligations under and in accordance with the Lease and the
Operative Agreements (and the Original Loan Certificates in the case of an
Original Loan Participant, the Indenture Trustee or the Trust Indenture
Estate if the Lessee shall have assumed the Certificates pursuant to
Section 7.11 of this Agreement), and (B) the earliest of (x) the expiration
of the Term of the Lease and return of the Aircraft in accordance with
Article 12 of the Lease, (y) the termination of the Lease in accordance with
the applicable provisions of the Lease and return of the Aircraft in
accordance with the Lease, or (z) the termination of the Lease in
accordance with the applicable provisions of the Lease and the transfer of
all right, title and interest in the Aircraft to the Lessee pursuant to its
exercise of any of its purchase options set forth in Section 4.02(a) of the
Lease, provided that this exclusion (iii) shall not apply in respect of any
payment made after the dates set forth in clauses (A) and (B) above unless
such payment is made with respect to any event or circumstance occurring
on, with or prior to such return or transfer or period prior to such return
or transfer, or Taxes incurred in connection with the exercise of any
remedies pursuant to Article 17 of the Lease following the occurrence of an
Event of Default;
(iv)As to the Owner Trustee, Taxes imposed against the Owner Trustee
upon or with respect to any fees for services rendered in its capacity as
Owner Trustee under the Original Trust Agreement or the Trust Agreement or,
as to the Indenture Trustee, Taxes imposed against the Indenture Trustee
upon or with respect to any fees received by it for services rendered in
its capacity as Indenture Trustee under the Original Indenture or the
Indenture;
(v) Taxes imposed on an Indemnitee that would not have been imposed
but for the willful misconduct or gross negligence of such Indemnitee
(other than gross negligence or willful misconduct not actually committed
by but instead imputed to such Indemnitee by reason of such Indemnitee's
participation in the transactions contemplated by the Operative Agreements
or the Original Agreements) or the breach by such Indemnitee of: (i) in the
case of an Indemnitee other than the Owner Participant, any representation,
warranty or covenant contained in the Operative Agreements or the Original
Agreements or any document delivered in connection therewith and (ii) in
the case of the Owner Participant, the representations or covenants in
Sections 7.02(a), (c); 7.03(a)(i), (ii), (iii), (iv), (vii), (ix); and
7.03(b), (c), (d), (e) of the Original Participation Agreement or this
Agreement (in either case unless attributable to a breach of representation,
warranty or covenant of the Lessee);
(vi)Taxes imposed on, and not collected by withholding from payments
of Rent, the Owner Trustee or the Owner Participant or any successor,
assign or Affiliate thereof which became payable by reason of any voluntary
or involuntary transfer or disposition by such Indemnitee subsequent to the
Delivery Date, including revocation of the Trust, of any interest in some
or all of the Aircraft, Airframe, Engines or Parts thereof or its interest
in the Lessor's Estate (not including any transfers of any Certificates
pursuant to Section 15.01(a) hereof) or a disposition in connection with a
bankruptcy or similar proceedings involving either the Lessor or the Owner
Participant other than (A) transfers resulting from a loss, substitution or
modification of the Aircraft, Engines or any Part, (B) any transfer of the
Aircraft, Engines or any Part (in each case other than at Fair Market
Value) to the Lessee or other person in possession thereof, (C) transfers
attributable to an Event of Default or (D) a transfer pursuant to the
Lessee's exercise of its rights under Section 10.01 of the Lease; the
parties agree to cooperate to minimize any such Taxes covered by this
provision;
(vii)Taxes imposed on the Owner Participant for which the Lessee is
obligated to indemnify the Owner Participant pursuant to the Tax Indemnity
Agreement;
(viii)Taxes imposed on a successor, assign or other transferee of the
Owner Participant or the Owner Trustee that is not a U.S. Person or of any
other Indemnitee under the Original Agreements or an Indemnitee as of the
date hereof under the Operative Agreements (including, without limitation,
a transferee which is a new lending office of an original Indemnitee) which
on the Delivery Date is an Indemnitee (for purposes of this clause (viii),
an "original Indemnitee") or such original Indemnitee to the extent that
such Taxes exceed the amount of Taxes that would have been imposed (in the
case of an Original Loan Participant, immediately after giving effect to
such succession, assignment or other transfer) and would have been
indemnifiable pursuant to Section 8.01(a) had there not been a succession,
assignment or other transfer by such original Indemnitee of any such
interest of such Indemnitee in the Aircraft or any Part, any interest in or
under any Operative Agreement, or any proceeds thereunder (it being
understood that for purposes of determining the amount of indemnification
that would have been due to such original Indemnitee with respect to a net
income Tax, it shall be assumed that such original Indemnitee would be
subject to taxation on its income at the highest marginal statutory rate
applicable to it), provided, however, that the exclusion provided by this
clause (viii) shall not apply in the case of a succession, transfer or
disposition (A) that occurs after the Lease has been declared in default
or if such transfer or disposition is pursuant to the exercise of remedies
under Article 17 of the Lease, (B) which is an actual or deemed transfer
pursuant to Section 7.11 hereof or as a consequence of a Refinancing under
Section 15.01 hereof, or any actual or deemed transfer of an Original Loan
Certificate that as part of a Refinancing under Section 15.01 hereof is not
retired, but only to the extent the Taxes attributable to such transfer
exceed the amount of Taxes that would have been imposed on such transferor
if the debt had instead been retired, (C) to the extent necessary to make
payments with respect to such Taxes on an After-Tax Basis, (D) to the
extent such Taxes are directly attributable to the failure of the Lessee to
take administrative actions as have been reasonably requested of it in
writing in a timely manner and which will result in no after-tax cost or
expense to the Lessee or (E) in the case of the Owner Participant or the
Lessor, to any Tax other than an Income Tax;
(ix)[Intentionally Left Blank];
(x) Any Taxes which have been included in the Purchase Price and which
have been paid to the applicable taxing authorities;
(xi)Any Taxes which would not have been imposed but for a Lessor's
Lien or an Indenture Trustee's Lien; and
(xii)Any Taxes imposed on the Owner Participant arising under or in
connection with any prohibited transaction, within the meaning of Section
406 of ERISA or Section 4975(c)(1) of the Code ("Prohibited Transaction");
provided, however, that in the event any prohibited transaction arises
which is not exempt under any class prohibited transaction exemption or any
individual or statutory prohibited transaction exemption (individually or
collectively, a "PTE") then the indemnity provided for herein shall extend
to any Taxes incurred by the Owner Participant (or any Affiliate thereof)
as the result of any Prohibited Transaction arising out of the purchase or
holding of any Loan Certificates by an employee benefit plan subject to
Title I of ERISA or by a plan subject to Section 4975 of the Code
(individually or collectively, an "ERISA Plan") with respect to which the
Owner Participant is a party in interest, within the meaning of Section
3(14) of ERISA, or a disqualified person,within the meaning of Section 4975
of the Code, except, however, that such Indemnity shall not extend to any
Taxes incurred by the Owner Participant (or any Affiliate thereof) as the
result of any Prohibited Transaction occurring with respect to the purchase
or holding of any Loan Certificates (A) over which purchase or holding the
Owner Participant (or an Affiliate thereof) has discretion or control
(other than in the capacity of a custodian, directed trustee or other
similar nondiscretionary capacity), or (B) by an ERISA Plan with respect to
which the Owner Participant (or any Affiliate thereof) is a "plan sponsor"
within the meaning of Section 3(16)(B) of ERISA.
(c) Withholding. The Pass Through Trustee shall withhold any Taxes
required to be withheld on payments to any holder of a Pass Through
Certificate who is a Non-U.S. Person except to the extent that such a holder
of a Pass Through Certificate has furnished evidence to the Pass Through
Trustee sufficient under applicable law to entitle such holder of a Pass
Through Certificate to any exemption from or reduction in the rate of
withholding on interest claimed by such holder of a Pass Through Certificate.
The Indenture Trustee shall withhold any Taxes required to be withheld on any
payment to a Holder pursuant to Section 5.09 of the Indenture. If the
Indenture Trustee or the Pass Through Trustee fails to withhold a Tax required
to be withheld with respect to any Holder of a Certificate or any holder of a
Pass Through Certificate or any claim is otherwise asserted by a taxing
authority against the Owner Trustee or Owner Participant for any withholding
tax, the Lessee will indemnify the Owner Trustee and the Owner Participant
(without regard to the exclusions set forth in Section 8.01(b) hereof) on an
After-Tax Basis against any such Taxes required to be withheld and any
interest and penalties with respect thereto, along with any other costs
(including reasonable attorney's fees) incurred in connection with any such
claim. The Indenture Trustee or the Pass Through Trustee, as the case may be,
in its individual capacity (and without recourse to the Trust Indenture
Estate), shall indemnify the Lessee (without regard to the exclusions set
forth in Section 8.01(b) hereof) on an After-Tax Basis for any payment the
Lessee shall have made pursuant to the preceding sentence.
Section 8.02. After-Tax Basis. The amount which the Lessee shall be
required to pay with respect to any Tax indemnified against under Section 8.01
shall be an amount sufficient to restore the Indemnitee, on an After-Tax
Basis, to the same position such party would have been in had such Tax not
been incurred, provided that the calculation of any additional amounts owing
to any Indemnitee as a result of the Lessee's obligation to indemnify on an
After-Tax Basis shall be made without regard to the exclusions set forth in
Section 8.01(b). If any Indemnitee actually realizes a tax benefit by reason
of the payment of any Tax paid or indemnified against by the Lessee, such
Indemnitee shall promptly pay to the Lessee, to the extent such tax benefit was
not previously taken into account in computing such payment, but not before the
Lessee shall have made all payments then due to such Indemnitee under this
Agreement, the Tax Indemnity Agreement and any other Operative Agreement, an
amount equal to the lesser of (x) the sum of such tax benefit plus any other
tax benefit actually realized by such Indemnitee that would not have been
realized but for any payment made by such Indemnitee pursuant to this sentence
and not already paid to the Lessee, and (y) the amount of the payment made
under Section 8.01 hereof and this Section 8.02 by the Lessee to such
Indemnitee plus the amount of any other payments by the Lessee to such
Indemnitee theretofore required to be made under this Section 8.02 and
Sections 8.01 and 8.05 hereof (and the excess, if any, of the amount described
in clause (x) above over the amount described in clause (y) above shall be
carried forward and applied to reduce pro tanto any subsequent obligations of
the Lessee to make payments to such Indemnitee pursuant to Section 8.01
hereof); provided, however, that notwithstanding the foregoing portions of
this sentence, such Indemnitee shall not be obligated to make any payment to
the Lessee pursuant to this sentence as long as an Event of Default shall have
occurred and be continuing under the Lease. The Lessee shall reimburse on an
After-Tax Basis such Indemnitee (and without regard to Section 8.01(b) hereof,
except for clause (v) thereof) for any payment of a tax benefit pursuant to
the preceding sentence (or a tax benefit otherwise taken into account in
calculating the Lessee's indemnity obligation hereunder) to the extent that
such tax benefit is subsequently disallowed or reduced (including the
expiration of any tax credit carryovers or carrybacks of such Indemnitee that
would not otherwise have expired).
Section 8.03. Time of Payment. Any amount payable to an Indemnitee
pursuant to this Article 8 shall be paid promptly, but in any event within 30
days after receipt of a written demand therefor from such Indemnitee
accompanied by a written statement describing in reasonable detail the basis
for such indemnity and the computation of the amount so payable, provided that
in the case of amounts which are being contested by the Lessee in good faith
or by the Indemnitee in either case pursuant to Section 8.04 hereof, such
amount shall be payable within 30 days after the time such contest is finally
resolved.
Section 8.04. Contests. If a written claim is made against any
Indemnitee for Taxes with respect to which the Lessee is liable for a payment
or indemnity hereunder, such Indemnitee shall promptly (but in any event
within 30 days of receipt thereof) give the Lessee notice in writing of such
claim and shall furnish the Lessee with copies of any written requests for
information sent to such Indemnitee (and not the Lessee) from any taxing
authority to the extent relating to such Taxes with respect to which the
Lessee may be required to indemnify hereunder and with respect to which it
would be necessary or beneficial to have information provided by the Lessee;
provided, however, that the failure of an Indemnitee to give such notice or
furnish such copy shall not terminate any of the rights of such Indemnitee
under this Article 8, except to the extent that the Lessee's contest rights
have been materially and adversely impaired by the failure to provide such
notice or copy. The Lessee may, at its option, contest in its own name or, if
required by law, require the Indemnitee to contest in good faith, with due
diligence and at the Lessee's expense, if timely requested in writing by the
Lessee, the validity, applicability or amount of such Taxes by:
(i) resisting payment thereof if lawful and practicable or not
paying the same except under protest if protest is necessary and proper in
each case so long as non-payment will not result in a material risk of the
sale, forfeiture or loss of, or the creation of a Lien other than a
Lessor's Lien on the Aircraft, Airframe or any Engine or any risk of
criminal liability; or
(ii) if the payment be made, using reasonable efforts to obtain a
refund thereof in appropriate administrative and judicial proceedings.
Notwithstanding the foregoing, the Lessee shall not be permitted or entitled
to contest any such Tax in its own name unless the Tax is reflected in a
report or a return of the Lessee or raised in an audit or other proceeding of
the Lessee and the Lessee is allowed to directly contest such Tax under
applicable law of the taxing jurisdiction provided, that if the Lessee is so
permitted under applicable law to contest a Tax asserted against the Lessee
and the same or similar Tax is also asserted against the Indemnitee, each of
the Lessee and such Indemnitee shall conduct its contest in its own name and
the Lessee and such Indemnitee will cooperate in a reasonable manner with
respect to the respective contests of such Tax.
If the Indemnitee, after reasonable discussion with the Lessee and
consideration in good faith of any suggestion made by the Lessee as to the
method of pursuing such contest, elects to conduct the contest, such
Indemnitee shall control the contest and shall determine the manner in which
to contest such Taxes and shall periodically or upon the Lessee's request
advise the Lessee of the progress of such contest; provided, however, that the
Lessee shall have the right to be consulted in good faith with respect to any
contest of claims subject to indemnification hereunder, including governmental
and judicial conferences and the right to be consulted in good faith regarding
the relevant portions of all related submissions to any governmental or other
authority, provided, however, that the Lessee shall be permitted to
participate in any such contest only (x) with respect to issues that can be
separated on audit from any Taxes for which the Lessee is not required to
indemnify the Indemnitee hereunder, and (y) if the Indemnitee shall have
determined that in its judgment, exercised in its sole discretion, neither
such participation nor the separation of issues will adversely affect the
Indemnitee. The Indemnitee will not settle a contest that results in a final
determination without consent of the Lessee, unless the Indemnitee waives its
right to indemnification with respect to such contest and any related contest.
Notwithstanding the preceding sentences of this Section 8.04, such Indemnitee
shall not be required to take or continue any action unless the Lessee shall
have (i) agreed in writing to pay and shall pay the Indemnitee on a current
basis and on an After-Tax Basis the after-tax cost of all reasonable fees and
expenses (including reasonable attorneys' fees and accountants' fees) which
such Indemnitee may incur as a result of contesting such Taxes, (ii) made all
payments and indemnities (other than contested payments and indemnities) then
due to the Indemnitee hereunder or with respect to any of the transactions
contemplated by or under the Operative Agreements and (iii) acknowledged in
writing the Lessee's obligation to such Indemnitee pursuant to this Agreement
to the extent that the contest is not successful, unless it is reasonably
clear from the resolution of the contest that an exclusion set forth in
Section 8.01(b) hereof applies. In no event shall such Indemnitee be required
or the Lessee be permitted to contest pursuant to this Section 8.04 the
imposition of any Tax for which the Lessee is obligated to indemnify any
Indemnitee hereunder unless (i) such Indemnitee shall have received, at the
Lessee's expense, an opinion of its tax counsel, such counsel to be reasonably
satisfactory to the Lessee ("Tax Counsel"), to the effect that there exists a
reasonable basis for contesting such claim, (ii) such Indemnitee (and, if such
Indemnitee is not the Owner Participant, the Owner Participant and such
Indemnitee) shall have determined that such contest will not result in any
material risk of loss, sale or forfeiture of, or the creation of a Lien (other
than Lessor's Liens) on, the Aircraft or any part thereof or interest thereon
or in a risk of criminal liability, or adversely affect the Trust Indenture
Estate, (iii) if a Payment Default, Bankruptcy Default or an Event of Default
shall have occurred and be continuing, the Lessee shall have provided security
for its obligations hereunder reasonably satisfactory to the Indemnitee, (iv)
if such contest shall be conducted in a manner requiring payment of the claim
in advance, the Lessee shall have advanced sufficient funds, on an interest
free basis, to make the payment required, and agreed to indemnify the
Indemnitee against any additional net adverse tax consequences on an After-Tax
Basis to such Indemnitee of such advance, (v) the issue shall not be the same
as an issue previously contested hereunder and decided adversely, unless the
Indemnitee shall have received at the Lessee's sole expense, a written
opinion, in form and substance reasonably satisfactory to such Indemnitee, of
Tax Counsel to the effect that the applicable circumstances or law has changed
and that in light thereof, there is substantial authority for contesting such
claim and (vi) the amount of the indemnity payments the Lessee would be
required to make with respect to such adjustment, when aggregated with similar
adjustments that could be raised in other taxable years of such Indemnitee
exceeds $50,000; provided, that in the event that such Indemnitee is not
required under this paragraph to contest any Tax liability for which the
Lessee is obligated to indemnify any Indemnitee, the Lessee may contest such
Tax liability in the name of the Lessee, if permitted by law. The Lessee may
appeal or require the Indemnitee to appeal any judicial decision provided the
foregoing requirements of this Section 8.04 are met and the Indemnitee shall
have received, at the Lessee's expense, an opinion of Tax Counsel, to the
effect that there is substantial authority for such appeal.
Nothing contained in this Section 8.04 shall require any Indemnitee to
contest or continue to contest, or permit Lessee to contest, a claim which such
Indemnitee would otherwise be required to contest pursuant to this Section
8.04, if such Indemnitee shall waive payment by Lessee of any amount that
might otherwise be payable by Lessee under this Article 8 in connection with
such claim.
Section 8.05. Refunds. Upon receipt by an Indemnitee of a refund of
all or any part of any Taxes which the Lessee shall have paid for such
Indemnitee or for which the Lessee shall have reimbursed or indemnified such
Indemnitee, and provided there shall not have occurred and be continuing any
Payment Default, Bankruptcy Default or Event of Default by the Lessee
hereunder or under the Lease (in which case payment shall not be made to the
Lessee until such Payment Default, Bankruptcy Default or Event of Default
shall have been cured), such Indemnitee shall pay to the Lessee an amount
equal to the amount of such refund less (x) any expenses not previously
reimbursed, (y) all payments then due to such Indemnitee under this Article
8 and (z) Taxes imposed with respect to the accrual or receipt thereof,
including interest received attributable thereto, plus any tax benefit
actually realized by such Indemnitee as a result of any payment by such
Indemnitee made pursuant to this sentence; provided, however, that such amount
shall not be payable (a) before such time as the Lessee shall have made all
payments or indemnities then due and payable to such Indemnitee under this
Article 8 and (b) to the extent that the amount of such payment would exceed
(i) the amount of all prior payments by the Lessee to such Indemnitee pursuant
to this Article 8 less (ii) the amount of all prior payments by such
Indemnitee to the Lessee pursuant to this Article 8.
Any subsequent loss of such refund or tax benefit shall be treated as
a Tax subject to indemnification under the provisions of this Article 8 (in
the case of any such tax benefit, without regard to Section 8.01(b) hereof).
Section 8.06. Lessee's Reports. In case any report or return is
required to be made with respect to any Taxes against which the Lessee is or
may be obligated to indemnify the Indemnitees under this Article 8, the Lessee
shall make such report or return, except for any such report or return that
the Indemnitee has notified the Lessee that it intends to file, in such manner
as will show the ownership of the Aircraft in the Owner Trustee and shall send
a copy of the applicable portions of such report or return to the Indemnitee
and the Owner Trustee or will notify the Indemnitee of such requirement and
make such report or return in such manner as shall be satisfactory to such
Indemnitee and the Owner Trustee. The Lessee will provide such information
reasonably available to the Lessee as the Indemnitee may reasonably require
from the Lessee to enable the Indemnitee to fulfill its tax filing
requirements with respect to the transactions contemplated by the Operative
Agreements (without duplication of the requirements of Section 3 of the Tax
Indemnity Agreement) and any audit information request arising from any such
filing. The Indemnitee will provide such information reasonably available to
it as the Lessee may reasonably require from such Indemnitee to enable the
Lessee to fulfill its tax filing requirements with respect to the transactions
contemplated by the Operative Agreements and any audit information request
arising from such filing; provided that in no event shall any Indemnitee be
required to provide copies of any of its tax returns or other confidential
information. The Lessee shall hold the Indemnitee harmless on an After-Tax
Basis from and against any liabilities, including penalties, additions to tax,
fines and interest, imposed upon or incurred by such Indemnitee to the extent
directly attributable to any insufficiency or inaccuracy in any return,
statement, or report prepared by the Lessee or information supplied by the
Lessee, or directly attributable to the Lessee's failure to supply reasonably
available information to such Indemnitee as required by this Section 8.06.
Section 8.07. Survival of Obligations. The representations,
warranties, indemnities and agreements of the Lessee provided for in this
Article 8 and the Lessee's obligations under any and all of them shall survive
the expiration or other termination of the Operative Agreements.
Section 8.08. Payment of Taxes. With respect to any Tax otherwise
indemnifiable hereunder by the Lessee and applicable to the Aircraft,
Airframe, any Engine or Parts, to the extent permitted by the applicable
federal, state, local or foreign law, the Lessee shall pay such tax directly
to the relevant Taxing authority and file any returns or reports required with
respect thereto to the extent legally entitled to do so in its own name;
provided, however, that the Lessee shall not make any statements or take any
action which would indicate that the Lessee or any Person other than the Owner
Trustee or Owner Participant is the owner of the Aircraft, the Airframe, any
Engine or any Part or which would otherwise be inconsistent with the terms of
the Lease or the Tax Indemnity Agreement and the position thereunder of the
Owner Trustee and the Owner Participant. Copies of such returns or reports,
together with evidence of payment of any tax due, shall be sent by the Lessee
to the Owner Participant within thirty (30) days after the date of each
payment by the Lessee of any Tax.
Section 8.09. Reimbursements by Indemnitees Generally. To the
extent the Lessee is required to pay or withhold any Tax imposed on or with
respect to an Indemnitee in respect of the transactions contemplated by the
Operative Agreements, which Tax is not otherwise the responsibility of the
Lessee under the Operative Agreements, or any other written agreements between
the Lessee and such Indemnitee, then such Indemnitee shall pay to the Lessee
within 30 days of the Lessee's demand therefor an amount which equals the
amount actually paid by Lessee with respect to such Taxes.
Section 8.10. Obligations of Lessee Unsecured. The obligations of
the Lessee to the Original Loan Participants under this Article 8 shall
constitute unsecured obligations of the Lessee to such Original Loan
Participants and are not secured by the Lien of the Indenture or the Original
Indenture.
ARTICLE 9
GENERAL INDEMNITY
Section 9.01. Generally. (a) The Lessee agrees to indemnify each
Indemnitee against and agrees to protect, defend, save and keep harmless each
Indemnitee from any and all liabilities, obligations, losses, damages,
penalties, claims, actions, suits, costs, disbursements and expenses
(including legal fees and expenses and all costs and expenses relating to
amendments, supplements, adjustments, consents, refinancings and waivers under
the Operative Agreements and the Original Agreements except as otherwise
provided in Section 10.01(d)(i) or Article 15 hereof) of every kind and
nature, including without limitation Make-Whole Premium (unless excluded
pursuant to Section 3.03 of the Lease) (whether or not any of the transactions
contemplated by this Agreement are consummated) (individually, an "Expense,"
collectively, "Expenses"), which may be imposed on, incurred or suffered by or
asserted against any Indemnitee, in any way relating to, based on or arising
out of:
(i) the Original Agreements, this Agreement, the Lease, the
Indenture, the Trust Agreement, the Pass Through Agreement, AVSA's FAA ▇▇▇▇
of Sale, AVSA's Warranty ▇▇▇▇ of Sale or any other Operative Agreement or
any other document entered into in connection herewith or any sublease or
transfer or any transactions contemplated hereby or thereby;
(ii) the operation, possession, use, non-use, maintenance, storage,
overhaul, delivery, non-delivery, control, repair or testing of the
Aircraft, Airframe, or any Engine or any engine used in connection with the
Airframe, or any part thereof by the Lessee, any sublessee or any other
Person whatsoever, whether or not such operation, possession, use, non-use,
maintenance, storage, overhaul, delivery, non-delivery, control, repair or
testing is in compliance with the terms of the Lease, including without
limitation, claims for death, personal injury or property damage or other
loss or harm to any Person whatsoever, including, without limitation, any
passengers, shippers or other Persons wherever located, and claims relating
to any laws, rules or regulations, including, without limitation,
environmental control, noise and pollution laws, rules or regulation;
(iii)the manufacture, design, sale, return, purchase, acceptance,
rejection, delivery, non-delivery, condition, repair, modification,
servicing, rebuilding, airworthiness, registration, reregistration, import,
export, performance, non-performance, lease, sublease, transfer,
merchantability, fitness for use, alteration, substitution or replacement
of any Airframe, Engine, or Part under the Lease, the Purchase Agreement,
the Purchase Agreement Assignment, the GTA or the Engine Warranty
Assignment or other transfer of use or possession, or other disposition of
the Aircraft, the Airframe, any Engine or any Part including, without
limitation, latent and other defects, whether or not discoverable, strict
tort liability, and any claims for patent, trademark or copyright
infringement;
(iv)any breach of or failure to perform or observe, or any other
non-compliance with, any condition, covenant or agreement to be performed,
or other obligations of the Lessee under any of the Operative Agreements or
the Original Agreements, or the falsity or inaccuracy of any representation
or warranty of the Lessee in any of the Operative Agreements or the
Original Agreements (other than representations and warranties in the Tax
Indemnity Agreement);
(v) the enforcement of the terms of the Operative Agreements or the
Original Agreements and the administration of the Trust Indenture Estate;
and
(vi)the offer, issuance, sale or delivery of any Certificate or any
Pass Through Certificate or any Original Loan Certificate, or any refunding
or refinancing thereof, or interest in the Lessor's Estate or the Trust
Agreement or the Original Trust Agreement or any similar interest or in any
way relating to or arising out of the Trust Agreement or the Original Trust
Agreement and the Lessor's Estate, the Indenture or the Original Indenture
or the Trust Indenture Estate (including, without limitation, any claim
arising out of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, or any other federal or state statute,
law or regulation, or at common law or otherwise relating to securities), or
the action or inaction of the Owner Trustee or Indenture Trustee as
trustees, in the manner contemplated by this Agreement, the Original
Participation Agreement, the Indenture, the Original Indenture, the
Indenture and Security Agreement Supplement, the Trust Agreement or the
Original Trust Agreement and in the case of the Owner Participant, its
obligations arising under Section 6.01 of the Trust Agreement or the
Original Trust Agreement.
The foregoing indemnity by the Lessee is intended to include and cover, but is
not limited to, any Expense to which the Indemnitees may be subject as a
result of their respective ownership or leasing of any interest in or holding
of any Lien on the Aircraft, Airframe, any Engine or Part during the Term,
whether or not in the Lessee's possession or control, insofar as such Expense
relates to any activity or event whatsoever involving such item while it is
under lease to the Lessee (or after termination of the Lease in connection
with the exercise of remedies thereunder to the extent that such Expense is
attributable to the transactions contemplated hereby and by the other
Operative Agreements and the Original Agreements), and such Expense does not
fall within any of the exceptions listed in Section 9.01(b) hereof.
(b) Exceptions. The indemnity provided for in Section 9.01(a) shall
not extend to any Expense of any Indemnitee to the extent it:
(i) would not have occurred but for the willful misconduct or gross
negligence of such Indemnitee;
(ii) is in respect of the Aircraft, and is attributable to acts or
events which occur after the Aircraft is no longer part of the Lessor's
Estate or, if the Aircraft remains a part of the Lessor's Estate, after the
expiration of the Term (unless the Aircraft is being returned at such time,
in which case after return of physical possession; provided that if the
Lessor has terminated the Lease pursuant to Article 17 thereof, the
indemnity provided in Section 9.01(a) hereof shall survive for so long as
Lessor shall be exercising remedies under such Article 17), or to acts or
events which occur after return of possession of the Aircraft by the Lessee
in accordance with the provisions of the Lease (subject to the foregoing
proviso if the Lessor has terminated the Lease pursuant to Article 17 of
the Lease) but in any such case only to the extent not fairly attributable
to acts or omissions of the Lessee prior to expiration of the Term,
including without limitation the Lessee's failure to fully discharge all of
its obligations under the Lease, the other Operative Agreements or the
Original Agreements;
(iii)is a Tax, whether or not the Lessee is required to indemnify
therefor pursuant to Article 8 hereof or pursuant to the Tax Indemnity
Agreement;
(iv)is a cost or expense required to be paid by the Owner Participant
or its permitted transferees (and not by the Lessee) pursuant to this
Agreement or any other Operative Agreement and for which the Lessee is not
otherwise obligated to reimburse the Owner Participant, directly or
indirectly pursuant to the terms of this Agreement or such other Operative
Agreement;
(v) would not have been incurred by such Indemnitee if such
Indemnitee had not been in breach of its representations or warranties, or
had not defaulted in the observance and performance of the terms and
provisions required to be observed and performed by it, in this Agreement,
the Purchase Agreement Assignment, the Lease, the Indenture, the Trust
Agreement, the Original Agreements or any other Operative Agreement to
which it is a party unless such breach or default shall be a result of the
breach or default by the Lessee of any of its obligations under the
Operative Agreements or by another Indemnitee of any of the foregoing;
(vi)[Intentionally Left Blank];
(vii)is, in the case of the Owner Participant, Lessor's Liens to the
extent attributable to the Owner Participant; in the case of the Owner
Trustee, Lessor's Liens to the extent attributable to the Owner Trustee; in
the case of FSB, Lessor's Liens to the extent attributable to FSB; and in
the case of the Indenture Trustee, Indenture Trustee's Liens;
(viii)is, in the case of the Owner Participant or the Owner Trustee,
attributable to the offer or sale by such Indemnitee after the Delivery
Date of any interest in the Aircraft, the Lessor's Estate or the Trust
Agreement or any similar interest (including an offer or sale resulting
from bankruptcy or other proceedings for the relief of debtors in which
such Indemnitee is the debtor), unless in each case such offer or sale
shall occur (x) in connection with a Refinancing, (y) as a result of the
occurrence of an Event of Default provided that either the Lease has been
declared in default or the transfer is pursuant to the exercise of remedies
under Article 17 of the Lease or (z) in connection with the Lessee's
exercise of its early termination option under Article 10 of the Lease or
its purchase options under Article 4 of the Lease or in connection with
Article 11 of the Lease;
(ix)is an Expense arising under or in connection with any prohibited
transaction, within the meaning of Section 406 of ERISA or Section
4975(c)(1) of the Code ("Prohibited Transaction"); provided, however, that
in the event any prohibited transaction arises which is not exempt under
any class prohibited transaction exemption or any individual or statutory
prohibited transaction exemption (individually or collectively, a "PTE")
then the indemnity provided for herein shall extend to any Expenses
incurred by the Owner Participant (or any Affiliate thereof) as the result
of any Prohibited Transaction arising out of the purchase or holding of any
Certificates by an employee benefit plan subject to Title I of ERISA or by
a plan subject to Section 4975 of the Code (individually or collectively,
an "ERISA Plan") with respect to which the Owner Participant is a party in
interest, within the meaning of Section 3(14) of ERISA, or a disqualified
person,within the meaning of Section 4975 of the Code, except, however, that
such Indemnity shall not extend to any Expenses incurred by the Owner
Participant (or any Affiliate thereof) as the result of any Prohibited
Transaction occurring with respect to the purchase or holding of any
Certificates (A) over which purchase or holding the Owner Participant (or
an Affiliate thereof) has discretion or control (other than in the capacity
of a custodian, directed trustee or other similar nondiscretionary
capacity), or (B) by an ERISA Plan with respect to which the Owner
Participant (or any Affiliate thereof) is a "plan sponsor" within the
meaning of Section 3(16)(B) of ERISA.
Section 9.02. After-Tax Basis. The amount which the Lessee shall be
required to pay with respect to any Expense indemnified against under Section
9.01 shall be an amount sufficient to restore the Indemnitee, on an After-Tax
Basis, to the same position such party would have been in had such Expense not
been incurred. If any Indemnitee actually realizes a permanent Tax benefit by
reason of the payment of such Expense paid or indemnified against by the
Lessee which was not considered in the computation thereof, such Indemnitee
shall promptly pay to the Lessee, but not before the Lessee shall have made
all payments theretofore due such Indemnitee under this Agreement, the
Original Agreements, the Tax Indemnity Agreement and any other Operative
Agreement, an amount equal to the lesser of (x) the sum of such Tax benefit
plus any other permanent Tax benefit actually realized by such Indemnitee as
the result of any payment made by such Indemnitee pursuant to this sentence
and (y) the amount of such payment pursuant to this Section 9.02 by the Lessee
to such Indemnitee plus the amount of any other payments by the Lessee to such
Indemnitee theretofore made pursuant to this Section 9.02 less the amount of
any payments by such Indemnitee to the Lessee theretofore made pursuant to
this Section 9.02 (and the excess, if any, of the amount described in clause
(x) above over the amount described in clause (y) above shall be carried
forward and applied to reduce pro tanto any subsequent obligations of the
Lessee to make payments to such Indemnitee pursuant to this Section 9.02), it
being intended that no Indemnitee should realize a net Tax benefit pursuant to
this Section 9.02 unless the Lessee shall first have been made whole for any
payments by it to such Indemnitee pursuant to this Section 9.02; provided,
however, that notwithstanding the foregoing portions of this sentence, such
Indemnitee shall not be obligated to make any payment to the Lessee pursuant
to this sentence so long as an Event of Default shall have occurred and be
continuing. Any Taxes that are imposed on any Indemnitee as a result of the
disallowance or reduction of such Tax benefit referred to in the next
preceding sentence in a taxable year subsequent to the year of allowance and
utilization by such Indemnitee (including the expiration of any tax credit
carryovers or carrybacks of such Indemnitee that would not otherwise have
expired) shall be indemnifiable pursuant to the provisions of Section 8.01
hereof without regard to Section 8.01(b) hereof.
Section 9.03. Subrogation. Upon the payment in full of any indemnity
pursuant to this Article 9 by the Lessee (but not earlier), the Lessee shall be
subrogated to any right of the Indemnitee, other than with respect to any of
such Indemnitee's insurance policies or in connection with any indemnity claim
the Person indemnified may have against any other Indemnitee in respect of the
matter against which such indemnity has been made.
Section 9.04. Notice and Payment. Each Indemnitee and the Lessee
shall give prompt written notice one to the other of any liability of which
such party has received notice for which the Lessee is, or may be, liable
under this Article 9; provided, however, that failure to give such notice
shall not terminate any of the rights of the Indemnitees under this Article 9,
except (with respect to such Indemnitee) to the extent that the Lessee has
been materially prejudiced by the failure to provide such notice. Unless
otherwise provided in the Operative Agreements, any amount payable to an
Indemnitee pursuant to this Article 9 shall be paid within 30 days after
receipt of a written demand therefor from such Indemnitee accompanied by a
written statement describing in reasonable detail the basis for such indemnity
and the computation of the amount so payable.
Section 9.05. Refunds. If any Indemnitee shall obtain a recovery of
all or any part of any amount which the Lessee shall have paid to such
Indemnitee or for which the Lessee shall have reimbursed such Indemnitee under
this Article 9, and provided there shall not have occurred a Payment Default
or an Event of Default (in which case payment shall not be made to the Lessee
until such Payment Default or Event of Default shall have been cured) such
Indemnitee shall pay to the Lessee the amount of any such recovery, including
interest received with respect to the recovery, net of any Taxes paid or
payable as a result of the receipt of the recovery and interest, plus any net
additional permanent income tax benefits actually realized by Indemnitee as
the result of any payment made pursuant to this sentence less any reasonable
costs and expense of any Indemnitee not reimbursed by the Lessee; provided,
however, that such amount shall not be payable (a) before such time as the
Lessee shall have made all payments or indemnities then due and payable to
such Indemnitee under this Article 9 or (b) to the extent that the amount of
such payment would exceed the amount of all prior payments by the Lessee to
such Indemnitee pursuant to this Article 9, less the amount of all prior
payments by such Indemnitee to the Lessee pursuant to this Article 9. Any
subsequent loss of such recovery or tax benefit shall be subject to
indemnification under Article 8 or this Article 9, as the case may be, but
without regard to Section 8.01(b) hereof, other than Section 8.01(b)(v) hereof.
Section 9.06. Defense of Claims. The Lessee or its insurers shall
have the right (in each such case at the Lessee's sole expense) to investigate
or, provided that (i) the Lessee or its insurers shall not reserve the right
to dispute liability with respect to any insurance policies pursuant to which
coverage is sought, (ii) in the case of the Lessee, no Payment Default or
Event of Default shall have occurred and be continuing or shall arise at any
time during the claim and (iii) the Lessee shall have first acknowledged in
writing to such Indemnitee the Lessee's obligation to indemnify such
Indemnitee hereunder in respect of such claim, defend any such claim covered by
insurance for which indemnification is sought pursuant to this Article 9 and
each Indemnitee shall cooperate with the Lessee or its insurers with respect
thereto, and provided, further, the Lessee shall not be entitled to assume and
control the defense of any such claim if and to the extent (A) such Indemnitee
reasonably objects to such control on the ground that an actual or potential
material conflict of interest exists where it is advisable for such Indemnitee
to be represented by separate counsel or on the grounds that such proceeding
involves the potential imposition of criminal liability on such Indemnitee or
(B) such proceeding will involve any material danger of the sale, forfeiture
or loss of, or the creation of any Lien on the Aircraft or the Trust Estate
(unless the Lessee posts a bond or other security reasonably acceptable in
form and substance to such Indemnitee) or involve any material risk of civil
liability to such Indemnitee for which it is not indemnified hereunder.
Subject to the immediately foregoing sentence, where the Lessee or the
insurers under a policy of insurance maintained by the Lessee undertake the
defense of an Indemnitee with respect to such a claim, no additional legal
fees or expenses of such Indemnitee in connection with the defense of such
claim shall be indemnified hereunder unless the fees or expenses were incurred
at the written request of the Lessee or such insurers. Subject to the
requirement of any policy of insurance applicable to a claim, an Indemnitee
may participate at its own expense at any judicial proceeding controlled by
the Lessee or its insurers pursuant to the preceding provisions, to the extent
that such party's participation does not, in the opinion of the independent
counsel appointed by the Lessee or its insurers to conduct such proceedings,
interfere with such control; and such participation shall not constitute a
waiver of the indemnification provided in this Section 9.06. No Indemnitee
shall enter into any settlement or other compromise with respect to any claim
described in this Section 9.06 without the prior written consent of the
Lessee, which consent shall not unreasonably be withheld or delayed, unless
such Indemnitee waives its right to be indemnified under this Article 9 with
respect to such claim. The Lessee shall not enter into any settlement or
compromise which the Lessee has not agreed to discharge or with respect to
which the Lessee has not agreed to indemnify such Indemnitee to such
Indemnitee's satisfaction or which admits any criminal violation, gross
negligence or willful misconduct on the part of any Indemnitee without the
prior written consent of such Indemnitee.
Section 9.07. Survival of Obligations. The representations,
warranties, indemnities and agreements of the Lessee provided for in this
Article 9 and the Lessee's obligations under any and all of them shall survive
the expiration or other termination of this Agreement, the Tax Indemnity
Agreement, the Trust Agreement, the Indenture, the Purchase Agreement
Assignment, the Engine Warranty Assignment, the Lease and the other Operative
Agreements but, as to such indemnities after the expiration or other
termination of the Lease, only with respect to losses, liabilities,
obligations, damages, penalties, claims, actions, suits, costs, Expenses and
disbursements caused by events occurring or existing (or fairly attributable
to the Lessee's acts or omissions) prior to such termination or expiration or
incurred in the process of (i) the return or disposition of the Aircraft under
Article 12 or Article 17 of the Lease, or (ii) the termination of the Lease or
the Indenture or, if later, the return of the Aircraft.
Section 9.08. Effect of Other Indemnities. The Lessee's obligations
under the indemnities provided for in this Agreement shall be those of a
primary obligor whether or not the Person indemnified shall also be
indemnified with respect to the same matter under the terms of this Agreement,
the Lease, the Indenture, the Trust Agreement, or any other document or
instrument, and the Person seeking indemnification from the Lessee pursuant to
any provision of this Agreement may proceed directly against the Lessee
without first seeking to enforce any other right of indemnification.
Section 9.09. Interest. The Lessee will pay to each Indemnitee on
demand, to the extent permitted by applicable law, interest on any amount of
indemnity not paid when due pursuant to this Article 9 until the same shall be
paid, at the Past Due Rate.
Section 9.10. Obligations of Lessee Unsecured. The obligations of
the Lessee to the Original Loan Participants under this Article 9 shall
constitute unsecured obligations of the Lessee to such Original Loan
Participants and are not secured by the Lien of the Indenture or the Original
Indenture.
ARTICLE 10
TRANSACTION COSTS
Section 10.01. Transaction Costs and Other Costs. (a) Transaction
Costs. The Owner Participant shall pay (or reimburse the Lessee if the Lessee
shall have previously made such payment), in addition to those items set forth
in Section 10.01(a) of the Original Participation Agreement all fees and
expenses of the following persons relating to the public offering of the Pass
Through Certificates contemplated by the Underwriting Agreement and related to
the transactions contemplated hereby: (i) the fees and expenses of counsel for
the Owner Participant; (ii) the fees and expenses of the transaction
documentation counsel and counsel for the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee, the Original Loan Participants and the
Underwriters (other than those fees, expenses and disbursements payable by the
Underwriters pursuant to the Underwriting Agreement); (iii) the fees and
expenses of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇; (iv) any initial fees and expenses
of the Pass Through Trustee and the fees and expenses of the Owner Trustee and
the Indenture Trustee; (v) any compensation, commissions and discounts payable
to the Underwriters pursuant to the Underwriting Agreement; (vi) the fees, if
any, incurred in printing the Pass Through Certificates; (vii) the fees and
expenses incurred in connection with printing any amendment to the
Registration Statement on Form S-3 bearing Registration No. 333-07691,
printing any Preliminary Prospectus or Prospectus (as such terms are defined
in the Underwriting Agreement) for the offering of the Pass Through
Certificates; (viii) the fees and expenses of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP; (ix) the
fees and expenses of ▇▇▇▇▇'▇ and S&P; (x) the fees and expenses of First
Chicago Leasing Corporation; (xi) the reasonable out-of-pocket expenses of the
Owner Participant; and (xii) reimbursement to the Owner Participant, the Owner
Trustee, the Indenture Trustee and the Pass Through Trustee for any and all
fees, expenses and disbursements incurred in connection with the negotiation,
preparation, execution and delivery, filing and recording of the Operative
Agreements and the documents contemplated thereby, including, without
limitation, travel expenses and disbursements which shall have been paid by
such party. The fees and expenses described in clauses (ii) through (xii) of
this paragraph shall be allocable to the Owner Participant under this
Agreement (1) to the extent incurred specifically with respect to the Owner
Participant or the refunding of the Original Loan Certificates, and (2) to the
extent such fees and expenses are incurred but are not specifically
attributable to the Owner Participant or the refunding of the Original Loan
Certificates, in the proportion that the principal amount of the Certificates
bears to the total amount of the Pass Through Certificates.
The Owner Participant, the Owner Trustee and the Lessee acknowledge
that the percentages for Basic Rent, Stipulated Loss Value and Termination
Value set forth in the Lease have been prepared assuming the aggregate amount
payable by the Owner Participant pursuant to the preceding paragraph and
Section 10.01 of the Original Participation Agreement is 1.35% of the Purchase
Price (the "Estimated Expense Amount").
(b) Continuing Expenses. The continuing fees, expenses and
disbursements (including reasonable counsel fees and expenses) of the entity
acting as Owner Trustee, as lessor under the Lease and as Owner Trustee under
the Trust Agreement with respect to the administration of the Lease and the
Lessor's Estate and the continuing fees, expenses and disbursements (including
reasonable counsel fees and expenses and initial fees relating to the
establishment of any replacement trustee) of the Indenture Trustee, as trustee
under the Indenture with respect to the administration of the Trust Indenture
Estate and the continuing fees, expenses and disbursements (including
reasonable counsel fees and initial fees relating to the establishment of a
replacement trustee) of the Pass Through Trustee shall be paid as Supplemental
Rent by the Lessee, including without limitation any amounts payable to the
Indenture Trustee or on account of requests by the Indenture Trustee for
indemnification under Article XI of the Indenture.
(c) Amendments, Supplements and Appraisal. Without limitation of the
foregoing, the Lessee agrees:
(i) to pay as Supplemental Rent to the Owner Trustee, the Owner
Participant, the Indenture Trustee and the Pass Through Trustee all costs
and expenses (including reasonable legal fees and expenses) incurred by any
of them in connection with (a) any Default or Event of Default and any
enforcement or collection proceedings resulting therefrom, or (b) the
enforcement of the obligations of the Lessee hereunder or under the other
Operative Agreements, including, without limitation, the entering into or
giving or withholding of any amendments or supplements or waivers or
consents (whether or not consummated), including without limitation, any
amendment, supplement, waiver or consent resulting from any work-out,
restructuring or similar proceeding relating to the performance or
nonperformance by the Lessee of its obligations under the Operative
Agreements or (c) any amendment, supplement, waiver or consent (whether or
not entered into) under the Original Agreements, this Agreement, the Lease,
the Indenture, the Certificates, the Tax Indemnity Agreement, the Purchase
Agreement Assignment or any other Operative Agreement or document or
instrument delivered pursuant to any of them, which amendment, supplement,
waiver or consent is required by any provision of any Operative Agreement
(including any adjustment pursuant to Section 3.04 of the Lease) or is
requested by the Lessee or necessitated by the action or inaction of the
Lessee; provided, however, that the Lessee shall not be responsible for
fees and expenses incurred in connection with the offer, sale or other
transfer (whether pursuant to Section 7.03(d) hereof or otherwise) by the
Owner Participant after the Refunding Date of any interest in the Aircraft,
the Lessor's Estate, the Beneficial Interest or the Trust Agreement or any
similar interest (and the Owner Participant shall be responsible for all
such fees and expenses), unless such offer, sale or transfer shall occur
(A) after the Lease has been declared in default or if the transfer is
pursuant to the exercise of remedies under Article 17 of the Lease or (B)
in connection with the termination of the Lease or action or direction of
the Lessee pursuant to Section 4.02, Article 10 or Article 11 of the Lease;
and
(ii)to pay the fees, costs and expenses of all appraisers involved in
an independent appraisal of the Aircraft to the extent required under
Section 4.03 of the Lease.
ARTICLE 11
SUCCESSOR OWNER TRUSTEE
Section 11.01. Appointment of Successor Owner Trustee. (a)
Resignation and Removal. The Owner Trustee or any successor Owner Trustee may
resign or may be removed by the Owner Participant, and a successor Owner
Trustee may be appointed and a Person may become Owner Trustee under the Trust
Agreement only in accordance with the provisions of Section 3.11 of the Trust
Agreement and the provisions of paragraphs (b) and (c) of this Section 11.01.
(b) Conditions to Appointment. The appointment in any manner of a
successor Owner Trustee pursuant to Section 3.11 of the Trust Agreement shall
be subject to the following conditions:
(i) Such successor Owner Trustee shall be a Citizen of the United
States;
(ii)Such successor Owner Trustee shall be a bank or a trust company
having combined capital, surplus and undivided profits of at least
$100,000,000 or a bank or trust company fully guaranteed by a direct or
indirect parent thereof having a combined capital, surplus and undivided
profits of at least $100,000,000;
(iii) Such appointment shall not violate any provisions of the
Transportation Code or any applicable rule or regulation of the applicable
regulatory agency or body of any other jurisdiction in which the Aircraft
may then be registered or create a relationship which would be in violation
of the Transportation Code or any applicable rule or regulation of the
applicable regulatory agency or body of any other jurisdiction in which the
Aircraft may then be registered;
(iv) Such successor Owner Trustee shall enter into an agreement or
agreements, in form and substance reasonably satisfactory to the Lessee, the
Owner Participant, the Pass Through Trustee and the Indenture Trustee
whereby such successor Owner Trustee confirms that it shall be deemed a
party to this Agreement, the Trust Agreement, the Lease, the Lease
Supplement, the Purchase Agreement Assignment, the Engine Warranty
Assignment, the Indenture, the Indenture Supplement and any other Operative
Agreement to which the Owner Trustee is a party and agrees to be bound by
all the terms of such documents applicable to the Owner Trustee and makes
the representations and warranties contained in Section 7.04 hereof (except
that it may be duly incorporated, validly existing and in good standing
under the laws of the United States of America or any State thereof); and
(v) All filings of Uniform Commercial Code financing and continuation
statements, filings in accordance with the Transportation Code and
amendments thereto shall be made and all further actions taken in
connection with such appointment as may be necessary in connection with
maintaining the validity, perfection and priority of the Lien of the
Indenture and the valid and continued registration of the Aircraft in
accordance with the Transportation Code.
(c) Appointment. For so long as the Aircraft remains registered
under the Transportation Code, the Owner Participant agrees to appoint
promptly a successor Owner Trustee meeting the requirements of Section
11.01(b) hereof in the event the Owner Participant has knowledge that the
Owner Trustee at any time shall not be a Citizen of the United States.
ARTICLE 12
LIABILITIES AND INTERESTS OF THE OWNER PARTICIPANT AND HOLDERS
Section 12.01. Liabilities of the Owner Participant. The Owner
Participant shall have no obligation or duty to the Lessee or to any Holder
with respect to the transactions contemplated by this Agreement, except those
obligations or duties expressly set forth in this Agreement, the Indenture,
the Trust Agreement, the Tax Indemnity Agreement, AVSA's FAA ▇▇▇▇ of Sale,
AVSA's Warranty ▇▇▇▇ of Sale, the Lease or any other Operative Agreement to
which the Owner Participant is a party and the Owner Participant shall not be
liable for the performance by any party hereto of such other party's
obligations or duties hereunder. Under no circumstances shall the Owner
Participant as such be liable to the Lessee, nor shall the Owner Participant be
liable to any Holder, for any action or inaction on the part of the Owner
Trustee or the Indenture Trustee in connection with this Agreement, the
Indenture, the Lease, the Trust Agreement, the Purchase Agreement Assignment,
the Engine Warranty Assignment, any other Operative Agreement, any Original
Agreement, the ownership of the Aircraft, the administration of the Lessor's
Estate or the Trust Indenture Estate or otherwise, whether or not such action
or inaction is caused by the willful misconduct or gross negligence of the
Owner Trustee or the Indenture Trustee.
Section 12.02. Interest of Holders of Certificates. A Holder of a
Certificate shall have no further interest in, or other right with respect to,
the Trust Indenture Estate when and if the principal and interest on all
Certificates held by such Holder and all other sums payable to such Holder
under this Agreement, under the Indenture and under such Certificates shall
have been paid in full.
ARTICLE 13
OTHER DOCUMENTS
Section 13.01. Consent of Lessee to Other Documents. The Lessee
hereby consents in all respects to the execution and delivery of the Trust
Agreement and the Indenture and to all of the terms of said documents, and the
Lessee acknowledges receipt of an executed counterpart of each of the Trust
Agreement and the Indenture; it being agreed that such consent shall not be
construed to require the Lessee's consent to any future supplement to, or
amendment, waiver or modification of the terms of the Trust Agreement, the
Indenture or the Certificates, except that no section of the Indenture or the
Trust Agreement shall be amended or modified in any manner which materially
adversely affects the Lessee without its consent.
Section 13.02. Further Assurances. The Lessee hereby confirms to the
Owner Participant its covenants set forth in and obligations under the Lease.
The Lessee agrees that, except as otherwise provided in the Indenture, the
Owner Trustee may not enter into any amendment, modification or supplement of,
or give any waiver or consent with respect to, or approve any matter or
document as being satisfactory under the Lease without the prior consent of
the Indenture Trustee and the Owner Participant and that, except as otherwise
provided in the Indenture, upon an Indenture Event of Default, the Indenture
Trustee may act as the Lessor under the Lease to the exclusion of the Owner
Trustee. The Lessee further agrees to deliver to the Indenture Trustee and
the Owner Participant a copy of each notice, statement, request, report or
other communication given or required to be given to the Owner Trustee under
the Lease.
Section 13.03. No Retroactive Application. This Agreement, the
Lease, the Indenture, the Ancillary Agreement I and the Trust Agreement each
amend and restate, and the Tax Indemnity Agreement amends, the respective
original agreements with no intention of retroactive application. The
applicable original agreements have been restated for the convenience of the
parties and such amendments and restatements, and such amendment in the case
of the Tax Indemnity Agreement, are not intended to waive or modify the
obligations of any party which accrued or were to have been performed on or
prior to the Refunding Date under such unamended agreements (or, in the case
of this Agreement, the effective date hereof) or to deprive any party of its
rights and remedies in respect thereof.
Section 13.04. Pass Through Trustee's Acknowledgment. The Pass
Through Trustee hereby acknowledges and agrees to be bound by all of the terms
and conditions of the Indenture, including without limitation, Section 8.01
thereof regarding the rights of the Owner Participant to purchase the
Certificates under circumstances specified therein.
ARTICLE 14
NOTICES
Section 14.01. Notices. All notices, demands, declarations and other
communications required by this Agreement shall be in writing and shall be
deemed received (a) if given by telecopier, when transmitted and the
appropriate telephonic confirmation received if transmitted on a Business Day
and during normal business hours of the recipient, and otherwise on the next
Business Day following transmission, (b) if given by certified mail, return
receipt requested, postage prepaid five Business Days after being deposited in
the United States mail and (c) if given by FedEx service (or, if a Default or
Event of Default shall have occurred and be continuing, by other comparable
courier service), when received or personally delivered, addressed:
(a) If to the Lessee, to its office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice President and Treasurer with a
copy to Senior Vice President and General Counsel at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (901)
395-4758; or to such other address as the Lessee shall from time to time
designate in writing to the Lessor, the Indenture Trustee and the Owner
Participant;
(b) If to the Lessor or the Owner Trustee, to its office at ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Department, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇; or to such
other address as the Lessor shall from time to time designate in writing to
the Lessee and the Indenture Trustee, with a copy to the Owner Participant;
(c) If to the Owner Participant, to its office at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Vice President Leasing
with a copy to Director, Portfolio Administration, telephone (914)
▇▇▇-▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇, or to such other address as the Owner
Participant may from time to time designate in writing to the Lessee and
the Indenture Trustee; and
(d) If to the Indenture Trustee or the Pass Through Trustee, to its
office at Two ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, telephone (▇▇▇) ▇▇▇-▇▇▇▇, facsimile
(▇▇▇) ▇▇▇-▇▇▇▇; or to such other address as the Indenture Trustee or the
Pass Through Trustee, as the case may be, shall from time to time designate
in writing to the Lessor, the Lessee and the Owner Participant.
ARTICLE 15
REFINANCING/REOPTIMIZATION
Section 15.01. Refinancing. (a) Subject to the terms and
conditions of this Section 15.01, the Lessee may request the Owner Participant
to participate in up to three refinancings (including the refinancing
contemplated by this Agreement on the Refunding Date) in whole but not in
part, of the Certificates prior to the end of the Basic Term (a
"Refinancing"). Such Refinancings may be placed in either the private or
public markets and shall be denominated in United States dollars (or in any
other foreign currency so long as the Owner Participant is satisfied there is
no foreign currency risk to it), and shall be on terms that do not materially
adversely affect the Owner Participant. The Owner Participant agrees to
negotiate promptly in good faith to conclude an agreement with the Lessee as
to the terms of any such Refinancing transaction (including the terms of any
debt to be issued in connection with such refinancing and the documentation to
be executed in connection therewith). Without the prior written consent of
the Owner Participant, the prospectus and other offering materials relating to
any Refinancing in the form of a public offering shall not identify the Owner
Participant and shall not include any financial statements of the Owner
Participant or any Affiliate thereof. In connection with any such Refinancing
in the form of a public offering, the Lessee shall indemnify the Owner
Participant in a manner satisfactory to it for any liabilities under federal,
state or foreign securities laws resulting from such offering. The aggregate
principal amount of the new Certificates issued in connection with each
Refinancing shall be the same as the aggregate principal amount outstanding on
the Certificates being refinanced.
(b) Notwithstanding anything herein to the contrary, no Refinancing
will be permitted unless the Owner Participant and the Indenture Trustee shall
have received at least 15 days prior written notice (three (3) Business Days
with respect to the refinancing contemplated by this Agreement on the
Refunding Date) of the scheduled closing date of such Refinancing and the
Owner Participant shall have been provided such longer period as it shall have
required for a reasonable opportunity to review the relevant documentation and
the Owner Participant shall have determined in good faith that neither it nor
the Owner Trustee shall suffer any loss or expense or bear any increased risk
as a result of such Refinancing (including, without limitation, any risk with
respect to taxes or other adverse consequences to the Owner Participant
including the application of Revenue Procedures 75-21 and 75-28 and Section
467 of the Code) for which it has not been or will not have been indemnified
by the Lessee in a manner reasonably satisfactory to the Owner Participant,
nor shall its rights against all other parties taken as a whole be adversely
affected compared to such rights in effect under the Operative Agreements
prior to such proposed Refinancing.
Prior to the consummation of any Refinancing pursuant to this Section
15.01, the Owner Participant and the Lessee shall agree upon a schedule
setting forth each installment of Basic Rent and setting forth Stipulated Loss
Values and Termination Values payable pursuant to the Lease as a result of the
Refinancing in accordance with Section 3.04 of the Lease, and thereafter the
amounts set forth in such schedule shall become the amounts payable under the
Lease. Upon the consummation of the Refinancing, the evidence of indebtedness
issued pursuant to the Refinancing shall be considered "Certificates" for
purposes of this Agreement, the Lease and the Indenture.
(c) Notwithstanding the foregoing, the Owner Participant shall have
no obligation to proceed with any Refinancing transaction as contemplated by
this Section 15.01 unless the Lessee indemnifies the Owner Trustee and the
Owner Participant by agreement in form and substance satisfactory to each of
them, for any liability, obligation (other than the obligation to pay
principal and interest in respect of the refinanced indebtedness), cost or
expense (including, without limitation, reasonable attorneys' fees and
Make-Whole Premium or other amounts due under the Indenture), including any
adverse tax consequences or impact, related to or arising out of any such
Refinancing transaction.
(d) Without the prior written consent of the Owner Participant, which
consent may be withheld in its sole discretion, no such refinancing shall (1)
cause the aggregate principal amount of the indebtedness to be substituted for
the Loan Certificates to exceed the aggregate principal amount of the then
outstanding Loan Certificates, (2) cause the weighted average life of such
indebtedness to be different by more than 6 months than the remaining weighted
average life of the then outstanding Loan Certificates, or (3) cause the date
of maturity of such indebtedness to be later than the date of maturity of the
Loan Certificates being refinanced.
(e) Each party agrees to take or cause to be taken all requested
action, including, without limitation, the execution and delivery of any
documents and instruments, including, without limitation, amendments or
supplements to the Lease, which may be reasonably necessary or desirable to
effect such Refinancing, including, in the case of the Owner Participant,
direction to the Owner Trustee by the Owner Participant to prepay the
Certificates then outstanding; provided, however, that such Refinancing shall
be subject to the satisfaction of each of the following conditions:
(i) Payment of principal, accrued interest, Make-Whole Premium and
Breakage Costs, if any, and all other sums due and owing on the Certificates
payable under the Indenture;
(ii)Payment in full of all other amounts then due and owing by the
Lessee under this Agreement, the Indenture, the Lease, the Trust Agreement,
and the Certificates then outstanding shall have been made by the Lessee;
(iii) Such party shall have received such opinions of counsel
(including, without limitation, an opinion received by the Owner
Participant from independent tax counsel reasonably satisfactory to the
Lessee that such Refinancing shall not result in any adverse tax
consequences to such Owner Participant, unless the Lessee shall have agreed
to provide an indemnity in respect thereof reasonably satisfactory in form
and substance to the Owner Participant), certificates and other documents
as it may reasonably request, each in form and substance reasonably
satisfactory to such party;
(iv) All authorizations, approvals and consents which in the
reasonable judgment of the Owner Participant are necessary for such
Refinancing shall have been obtained;
(v) The Lessee shall have provided or agreed to provide to the Owner
Participant, as Supplemental Rent under the Lease, sufficient funds to pay
any Breakage Costs, Make-Whole Premium and any other amounts due under the
Indenture;
(vi) The satisfaction or waiver by each other party to this
Agreement of the conditions set forth in this Section 15.01 to such party's
obligations under this Section 15.01;
(vii) No Payment Default, Bankruptcy Default or Event of Default
shall have occurred and be continuing or would occur immediately after
giving effect to such Refinancing;
(viii)In the event the Lessee shall not prohibit the purchase of
the Refinancing loan certificates by, or with the assets of, an employee
benefit plan, as defined in Section 3(3) of ERISA, which is subject to
Title I of ERISA or a plan or individual retirement account, which is
subject to Section 4975(c) of the Code, (individually or collectively, an
"ERISA Plan"), the Lessee will permit the placement of the Refinancing loan
certificates with an ERISA Plan only if either (A) if such placement is in
the form of pass through certificates, the sole underwriter or the manager
or co-manager of the underwriting syndicate or the selling or placement
agent of the Refinancing loan certificates represents to the Lessee that it
has a prohibited transaction exemption from the U.S. Department of Labor
with respect to pass through certificates (such as Prohibited Transaction
Exemption 89-88 or any other comparable exemption) or (B) purchasers of the
Refinancing loan certificates provide a representation (which may be in the
form of a deemed representation) regarding their source of funds used in
acquiring the Refinancing loan certificates and, if such purchasers
represent that they are using funds of an ERISA Plan in acquiring the
Refinancing loan certificates, such purchasers further represent that (1)
either they are relying on a prohibited transaction exemption from the U.S.
Department of Labor with respect to their purchase and holding of the
Refinancing loan certificates and they provide representations regarding the
satisfaction of the relevant conditions of such an exemption or (2) their
purchase and holding of the Refinancing loan certificates will not
constitute a non-exempt prohibited transaction under Section 406 of ERISA
or Section 4975 of the Code. The reliance on any such exemption will not
be conditional on the Owner Participant's representation concerning its
party in interest or other status with respect to ERISA Plans. If neither
exemption referred to in clause (A) or (B) of this paragraph (viii) is
valid or applicable in any respect to the purchase and holding of the
Refinancing loan certificates, or if the representation in clause (B) of
this paragraph (viii) that such purchase and holding will not constitute a
non-exempt prohibited transaction is not correct, whichever is applicable,
then the Lessee shall indemnify the Owner Participant pursuant to, and to
the extent provided for, under Sections 8 and 9 hereof for Taxes and
Expenses resulting from any "prohibited transaction", within the meaning of
Section 406 of ERISA or Section 4975(c)(1) of the Code, occurring with
respect to the placement of the Refinancing loan certificates with, or the
holding of the Refinancing loan certificates by, any ERISA Plan with
respect to which the Owner Participant is a party in interest, within the
meaning of Section 3(14) of ERISA, or a disqualified person, within the
meaning of Section 4975 of the Code, provided, however, that if the Lessee
shall fail to obtain either of the representations set forth in clause (A)
or (B) of this paragraph (viii), such indemnity shall not be subject to the
exceptions set forth under Sections 8.01(b)(xii)(A) and (B) and
9.01(b)(ix)(A) and (B) hereof; and
(ix) The Lessee shall pay all costs and expenses (including legal
fees) incurred in connection with any proposed or actually consummated
Refinancing.
Section 15.02. Reoptimization. (a) If a Change in Tax Rate occurs
prior to the end of the Basic Term, then, subject to the terms and conditions
of this Section 15.02 and Section 3.04 of the Lease, the Owner Participant
may, upon 30 days' prior notice to the Lessee, the Indenture Trustee, the
Owner Trustee and the Holders, elect to modify the schedule of payments of
principal of the certificates issued ("Refinancing Certificates") in
connection with any Refinancing effected after the Refunding Date using
private debt (not including debt issued pursuant to an exemption from
registration under the Securities Act relying on Rule 144A promulgated
thereunder but otherwise marketed in a manner substantially similar to
securities registered under the Securities Act, and not including debt issued
in connection with any offering of securities registered under the Securities
Act) due on each remaining Rent Payment Date on or commencing on the Rent
Payment Date next succeeding the date mutually agreed to by the Owner
Participant, the Lessee and the Indenture Trustee on which the Owner
Participant shall make such modification (the "Reoptimization Date"). Promptly
after making such modification, the Owner Participant shall furnish each party
hereto written notice of the amounts so recalculated.
(b) Adjustments to Refinancing Certificates. On the Reoptimization
Date, subject to the satisfaction on or before the Reoptimization Date of the
conditions set forth in Section 15.02(c), the Owner Trustee will issue and
deliver and the Indenture Trustee will authenticate, and each holder of a
Refinancing Certificate will accept delivery of, a new Refinancing Certificate
or Refinancing Certificates (in replacement of each Refinancing Certificate
then held by such holder, which Refinancing Certificates shall be surrendered
to the Indenture Trustee for cancellation) containing such changed principal
installments (expressed as a percentage of the original principal amount of
such Refinancing Certificate) as shall have been recalculated by the Owner
Participant, but in the same principal amount as, and containing terms
identical to, except as otherwise contemplated by Section 15.02(d) hereof, the
Refinancing Certificates originally issued in connection with the Operative
Agreements.
(c) Conditions to the Obligations of the Holders of the Refinancing
Certificates on the Reoptimization Date. The obligation of each holder of a
Refinancing Certificate to accept delivery of a new Refinancing Certificate on
the Reoptimization Date, and to surrender on such Reoptimization Date any
Refinancing Certificate then held by it, is subject to the following
conditions precedent having been satisfied on or before the Reoptimization
Date:
(i) the requirements of Section 15.02(d) hereof shall have been
satisfied;
(ii)the following documents, in form and substance satisfactory to
such Holder, shall have been duly authorized, executed and delivered by the
party or parties thereto and shall be in full force and effect: (A) if the
payments of Basic Rent, Stipulated Loss Values and Termination Values with
respect to the Term have been changed, an amendment to the Lease, dated the
Reoptimization Date, (B) an amendment to the Indenture setting forth any
changed repayment schedule to the Refinancing Certificates, dated the
Reoptimization Date and duly filed (or in the process of being so duly
filed) for recordation with the Aeronautics Authority and (C) replacement
Refinancing Certificates; and
(iii)in connection with any Reoptimization the Owner Participant
shall pay or agree to pay all reasonable costs and expenses incurred by the
Lessee, the Owner Trustee, the Indenture Trustee and each Holder of a
Refinancing Certificate (including, without limitation, reasonable legal
fees and expenses) in connection with any such reoptimization.
(d) Payment Schedules. Except as otherwise provided in this Section
15.02 as long as the Refinancing Certificates remain outstanding, the payment
schedules for the Refinancing Certificates shall not be modified.
ARTICLE 16
[INTENTIONALLY LEFT BLANK]
ARTICLE 17
MISCELLANEOUS
Section 17.01. Owner for Federal Tax Purposes. It is hereby agreed
between the Owner Participant and the Lessee (but the Lessee makes no
representation to such effect) that it is the intent of the parties for
Federal, state, local and foreign income tax purposes that the Owner
Participant will be treated as the owner of the Aircraft and the Lessee will
be treated as the lessee of the Aircraft.
Section 17.02. [Intentionally Left Blank.]
Section 17.03. Counterparts. This Agreement may be executed by the
parties in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
Section 17.04. No Oral Modifications. Neither this Agreement nor
any of its terms may be terminated, amended, supplemented, waived or modified
orally, but only by an instrument in writing signed by the party against which
the enforcement of the termination, amendment, supplement, waiver or
modification is sought. No such written termination, amendment, supplement,
waiver or modification shall be effective unless a signed copy shall have been
delivered to and executed by the Owner Trustee and the Indenture Trustee. A
copy of each such termination, amendment, supplement, waiver or modification
shall also be delivered to each other party to this Agreement other than the
Original Loan Participants.
The consent of the Pass Through Trustee, in its capacity as a party
to this Agreement and not as a Holder, shall not be required to modify, amend
or supplement this Agreement or to give any consent, waiver, authorization or
approval with respect to this Agreement under the circumstances in which the
consent of the Indenture Trustee would not be required for such modification,
amendment, supplement, consent, waiver or approval in accordance with Section
8.01(b) of the Indenture, provided that the Pass Through Trustee shall be
entitled to receive an Opinion of Counsel (as defined in the Pass Through
Agreement) necessary, in its sole discretion, to establish that the Indenture
Trustee's consent would not be required under such circumstances.
Section 17.05. Captions. The table of contents preceding this
Agreement and the headings of the various Articles and Sections of this
Agreement are for convenience of reference only and shall not modify, define,
expand or limit any of the terms or provisions of this Agreement.
Section 17.06. Successors and Assigns. The terms of this Agreement
shall be binding upon, and shall inure to the benefit of, the Lessee and its
successors and permitted assigns, the Owner Participant and its successors and
permitted assigns, including without limitation each Holder of a Certificate,
the Owner Participant and its successors and permitted assigns, the Owner
Trustee and its successors as Owner Trustee (and any additional owner trustee
appointed) under the Trust Agreement, the Indenture Trustee and its successors
as Indenture Trustee (and any additional indenture trustee appointed) under
the Indenture and the Pass Through Trustee and its successors as Pass Through
Trustee (and any additional pass through trustee appointed).
Section 17.07. Concerning the Owner Trustee, Indenture Trustee and
the Pass Through Trustee. Each of FSB and SSB is entering into this Agreement
solely in their respective capacities (except to the extent otherwise
expressly indicated), in the case of FSB, not in its individual capacity but
solely as Owner Trustee under the Trust Agreement, in the case of SSB, not in
its individual capacity but solely as Indenture Trustee under the Indenture
and as Pass Through Trustee under the Pass Through Agreement, and except as
otherwise expressly provided in this Agreement or in the Lease, the Indenture,
the Pass Through Agreement or the Trust Agreement, neither FSB, nor SSB,
shall be personally liable for or on account of its statements,
representations, warranties, covenants or obligations under this Agreement;
provided, however, that each of FSB and SSB accepts the benefits running to it
under this Agreement, and each agrees that (except as otherwise expressly
provided in this Agreement or any other Operative Agreement to which it is a
party) it shall be liable in its individual capacity for (a) its own gross
negligence or willful misconduct (whether in its capacity as trustee or in its
individual capacity), (b) any breach of representations and warranties or any
breach of covenants made in its individual capacity pursuant to or in
connection with this Agreement or the other Operative Agreements to which it is
a party, (c) any breach, in the case of the Owner Trustee, of its covenants
contained in Sections 3.05 and 3.08 of the Indenture, (d) the failure to use
ordinary care in receiving, handling and disbursing funds, (e) in the case of
the Owner Trustee, Lessor's Liens attributable to it in its individual
capacity, (f) in the case of the Indenture Trustee, Indenture Trustee's Liens
and (g) taxes, fees or other charges on, or based on, or measured by, any
fees, commissions or compensation received by it in connection with the
transactions contemplated by the Operative Agreements.
Section 17.08. 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, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 17.09. Public Release of Information. Subject to applicable
legal requirements (including, without limitation, securities laws
requirements, other regulatory requirements and other legally compelled
disclosures), so long as there shall not have occurred an Event of Default or
Indenture Event of Default, each party to this Agreement shall in each
instance obtain the prior written approval of each other party to this
Agreement concerning the exact text and timing of news releases, articles and
other information releases to the public media concerning any Operative
Agreements.
Section 17.10. Certain Limitations on Reorganization. The Indenture
Trustee and the Pass Through Trustee agree that, if (i) the Owner Trustee
becomes or all or any part of the Lessor's Estate or the trust created by the
Trust Agreement becomes the property of, a debtor subject to the
reorganization provisions of the Bankruptcy Code or any other applicable
bankruptcy or insolvency statutes, (ii) pursuant to any such reorganization
provisions, the Owner Participant is held to have recourse liability to the
debtor, the Owner Trustee or the trustee of the debtor directly or indirectly
on account of any amount payable as Make-Whole Premium, principal or interest
on the Certificates, or any other amount payable on any Certificate that is
provided in the Operative Agreements to be nonrecourse to the Owner
Participant and (iii) the Indenture Trustee actually receives any Recourse
Amount which reflects any payment by the Owner Participant on account of (ii)
above, then the Indenture Trustee, as the case may be, shall promptly refund
to the Owner Participant such Recourse Amount. For purposes of this Section
17.10, "Recourse Amount" means the amount by which the portion of such payment
by the Owner Participant on account of clause (ii) above received by the
Indenture Trustee exceeds the amount which would have been received by the
Indenture Trustee if the Owner Participant had not become subject to the
recourse liability referred to in (ii) above. Nothing contained in this
Section shall prevent the Indenture Trustee from enforcing any individual
obligation (and retaining the proceeds thereof) of the Owner Participant under
this Agreement or any other Operative Agreement to the extent herein or
therein provided, for which the Owner Participant has expressly agreed by the
terms of this Agreement to accept individual responsibility.
Section 17.11. GOVERNING LAW. THIS AGREEMENT SHALL IN ALL RESPECTS
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, WITHOUT
GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS AND IS BEING DELIVERED IN NEW
YORK.
Section 17.12. Section 1110 Compliance. The Owner Participant, the
Lessee and the other parties hereto agree that the transactions contemplated
by the Operative Agreements are expressly intended to be, shall be and should
be construed so as to be entitled to the benefits and protection of Section
1110 of the Bankruptcy Code.
ARTICLE 18
CONFIDENTIALITY
Section 18.01. Confidentiality. Each party hereto agrees (on behalf
of itself and each of its Affiliates, agents, directors, officers, employees
and representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature, any non-public information supplied to it pursuant to this
Agreement which is identified by the Person supplying the same as being
confidential at the time the same is delivered to such party, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for any of the parties hereto, (iii) to bank examiners or similar
regulatory authorities, auditors or accountants, (iv) in connection with any
litigation to which any one or more of the parties hereto is a party relating
to the transactions contemplated hereby or by any of the Operative Agreements,
(v) to an Affiliate of the parties hereto, (vi) to any assignee or participant
(or prospective assignee or participant) or other transferee so long as such
assignee or participant (or prospective assignee or participant) or other
transferee first executes and delivers to the respective party making such
assignment or participation an agreement in writing to be bound by the
provisions of this Section 18.01 or (vii) in the case of the Owner Participant
or the Owner Trustee (in its individual or trust capacity) to the Owner
Trustee (in its individual or trust capacity) or to the Owner Participant, as
the case may be.
IN WITNESS WHEREOF, the parties have caused this Participation
Agreement to be executed by their respective, duly authorized officers and this
Participation Agreement shall be effective this 17th day of October, 1996.
LESSEE:
FEDERAL EXPRESS CORPORATION
By:__________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Treasurer and Managing
Director - Structured Finance
OWNER PARTICIPANT:
PMCC LEASING CORPORATION
By:__________________________________________
Name:
Title:
OWNER TRUSTEE:
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual
capacity except as otherwise
expressly provided herein,
but solely as Owner Trustee
By:__________________________________________
Name:
Title:
INDENTURE TRUSTEE:
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Indenture Trustee
By:__________________________________________
Name:
Title:
PASS THROUGH TRUSTEE:
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity except as
otherwise expressly provided herein,
but solely as Pass Through Trustee
By:__________________________________________
Name:
Title:
ORIGINAL LOAN PARTICIPANTS:
▇▇▇▇▇▇ GUARANTY TRUST COMPANY
OF NEW YORK,
as Agent and as an Original Loan Participant
By:__________________________________________
Name:
Title:
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By:__________________________________________
Name:
Title:
THE CHASE MANHATTAN BANK
By:__________________________________________
Name:
Title:
COMMERZBANK AG, ATLANTA AGENCY
By:__________________________________________
Name:
Title:
NATIONSBANK, N.A. (SOUTH)
By:__________________________________________
Name:
Title:
SCHEDULE I
CERTIFICATE INFORMATION
1. Federal Express Corporation Pass Through Trust, 1996-B1
Federal Express Corporation Trust No. N667FE
Interest Rate: 7.39%
Maturity: January 30, 2012
Principal Amount: $43,597,000.00
2. Federal Express Corporation Pass Through Trust, 1996-B2
Federal Express Corporation Trust No. N667FE
Interest Rate: 7.84%
Maturity: January 30, 2018
Principal Amount: $18,188,000.00
SCHEDULE II
DEFINITIONS
GENERAL PROVISIONS
The following terms shall have the following meanings for all
purposes of the Operative Agreements (other than the Pass Through Agreement
and the Series Supplements) referred to below, unless otherwise defined in an
Operative Agreement or the context thereof shall otherwise require. In the
case of any conflict between the provisions of this Schedule and the
provisions of any Operative Agreement, the provisions of such Operative
Agreement shall control the construction of such Operative Agreement.
Unless the context otherwise requires and except in the case of the
Original Agreements, (i) references to agreements shall be deemed to mean and
include such agreements as amended and supplemented from time to time, and
(ii) references to parties to agreements shall be deemed to include the
successors and permitted assigns of such parties.
DEFINED TERMS:
Additional Insured. As defined in Article 13 of the Lease.
Aeronautics Authority. As appropriate, the Federal Aviation
Administration and/or the Administrator of the Federal Aviation
Administration, any successor to the former United States Civil Aeronautics
Board, or any Person, governmental department, bureau, commission or agency
located in the United States succeeding to the functions of any of the
foregoing.
Affiliate. 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" (including "controlled
by" and "under common control with") shall mean 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. In no event shall the Owner Trustee or the Lessor be deemed an
Affiliate of the Owner Participant.
After-Tax Basis. A basis such that any payment to be received by a
Person shall be supplemented by a further payment to such Person so that the
sum of the two payments, after deduction of all Taxes resulting from the
receipt or accrual of such payments, shall be equal to the payment to be
received. In the case of amounts payable to the Lessor, the Owner Participant,
or any corporate Affiliate of the Owner Participant, it shall be presumed that
such Person is at all times subject to Federal income tax at the maximum
marginal rate generally applicable to corporations from time to time and
actual state, local and foreign income taxes.
Agent. ▇▇▇▇▇▇ Guaranty Trust Company of New York and its
successors and permitted assigns as Agent for the Original Loan Participants
pursuant to Article 16 of the Original Participation Agreement.
Air Carrier. Any U.S. Air Carrier and any "foreign air carrier"
(as defined in the Transportation Code) as to which there is in force a permit
granted under Section 41302 of the Transportation Code.
Airbus Guaranty. The Guaranty dated the Delivery Date executed by
the Manufacturer and guaranteeing AVSA's Warranty ▇▇▇▇ of Sale.
Aircraft. The Airframe (or any permitted substitute airframe
thereunder) together with two Engines (whether either is an initial Engine or
a Replacement Engine) whether or not any of such initial or Replacement
Engines may from time to time be installed on such Airframe or may be
installed on any other airframe or on any other aircraft, including any
aircraft substituted pursuant to Section 11.03 of the Lease.
Airframe. The Airbus A300F4-605R aircraft (excluding the Engines
or engines from time to time installed thereon) leased by the Lessor to the
Lessee pursuant to the Lease and the initial Lease Supplement and having the
United States FAA Registration Number initially and manufacturer's serial
number specified in the initial Lease Supplement, including (i) all Parts in
respect thereof and (ii) any replacement airframe which may be substituted
pursuant to Section 11.03 of the Lease.
Amendment No. 1 to the Original Tax Indemnity Agreement. Amendment
No. 1 to the Original Tax Indemnity Agreement (Federal Express Corporation
Trust No. N667FE), dated as of October 15, 1996.
Ancillary Agreement. Any written agreement of the Lessee to which
the Lessor is a party or to which the Lessor has consented in writing entered
into on the Delivery Date or the Refunding Date or any date thereafter in
connection with the transactions contemplated by the Operative Agreements, as
such agreement may be amended and supplemented from time to time with the
consent of the Lessor and delivered to the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Owner Participant.
Ancillary Agreement I. The Ancillary Agreement I (Federal Express
Corporation Trust No. N667FE), dated the Delivery Date, as amended and
restated as of the Refunding Date, among the Lessee, the Owner Trustee, not in
its individual capacity, but solely as Owner Trustee, the Owner Participant
and the Indenture Trustee not in its individual capacity, but solely as
Indenture Trustee, as originally executed or as amended, modified or
supplemented with the consent of all the parties thereto.
Ancillary Agreement II. The Ancillary Agreement II (Federal
Express Corporation Trust No. N667FE), dated the Refunding Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as Owner
Trustee, the Owner Participant and the Indenture Trustee not in its individual
capacity, but solely as Indenture Trustee, as originally executed or as
amended, modified or supplemented with the consent of all the parties thereto.
Appraisal. The report prepared by BK Associates, Inc. and
delivered to the Owner Participant (with an abbreviated report to the Lessee)
on the Delivery Date pursuant to Section 4.01(n) of the Original Participation
Agreement.
Assignment and Assumption Agreement. Any agreement delivered in
compliance with Section 7.03(d) of the Participation Agreement.
AVSA. AVSA S.A.R.L., a societe a responsabilite limitee,
organized and existing under the laws of France, and its successors and
assigns.
AVSA Consent and Agreement. The Consent and Agreement dated as of
August 1, 1996, executed by AVSA, as the same may be amended, modified or
supplemented from time to time.
AVSA's FAA ▇▇▇▇ of Sale. The ▇▇▇▇ of sale for the Airframe on AC
Form 8050-2, or such other form as may be approved by the Aeronautics
Authority, executed by AVSA in favor of the Owner Trustee and dated the
Delivery Date.
AVSA's Warranty ▇▇▇▇ of Sale. The full warranty ▇▇▇▇ of sale
covering the Aircraft (and specifically referring to each Engine) executed by
AVSA as owner of the Aircraft in favor of the Owner Trustee and dated the
Delivery Date.
Bankruptcy Code. The Federal Bankruptcy Code of 1978, as amended,
and any successor thereto.
Bankruptcy Default. An event specified in Section 16.01(e), (f)
or (g) of the Lease which either does or, with the giving of notice or lapse
of time or both, would constitute an Event of Default.
Basic Rent. The aggregate periodic rent payable for the Aircraft
throughout the Basic Term pursuant to Section 3.02 of the Lease, adjusted
pursuant to Article 3 of the Lease.
Basic Term. The period commencing at the beginning of the day on
the Commencement Date and ending at the end of the day on November 28, 2019, or
such earlier date on which the Lease shall be terminated as provided therein.
Beneficial Interest. The interest of the Owner Participant under
the Trust Agreement.
Breakage Costs. Has the meaning specified in Schedule II to the
Original Participation Agreement.
Business Day. Any day on which commercial banks are not
authorized or required to close in New York, New York, Memphis, Tennessee and
the city in which the office or agency in the United States is maintained by
the Pass Through Trustee for the payment of the Pass Through Certificates, and
after the Lien of the Indenture is discharged, Salt Lake City, Utah.
Certificates. The Equipment Trust Certificates (Federal Express
Corporation Trust No. N667FE), issued by the Owner Trustee pursuant to the
Indenture and any certificate issued in exchange therefor or replacement
thereof pursuant to the Indenture.
Change in Tax Rate. Any amendment, modification, deletion,
addition, or change to the Code which is enacted into law after the Delivery
Date which changes the highest marginal statutory rate of Federal income tax
applicable to the Owner Participant (other than a change which is in the
nature of a minimum tax).
Citizen of the United States. A citizen of the United States as
defined in Section 40102(a)(15) of the Transportation Code, or any analogous
part of any successor or substituted legislation or regulation at the time in
effect.
Closings. The closing with respect to the acquisition of the Pass
Through Certificates by the Underwriters and the closing with respect to the
refunding of the Original Loan Certificates.
Code. Except as otherwise provided, the Internal Revenue Code of
1986, as amended from time to time.
Commencement Date. January 30, 1997.
Consent and Agreement. The Consent and Agreement dated as of
August 1, 1996 executed by the Manufacturer, as the same may be amended,
modified or supplemented from time to time.
Consent and Guaranty. The Consent and Guaranty of the Manufacturer
attached to the Purchase Agreement.
Corporate Trust Administration. The principal office of the
Indenture Trustee located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust Department, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Participant and the Owner Trustee.
Corporate Trust Department. The principal office of the Owner
Trustee located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, or such other office at which the Owner
Trustee's corporate trust business shall be administered which the Owner
Trustee shall have specified by notice in writing to the Lessee, the Owner
Participant and the Indenture Trustee.
CRAF Program. Has the meaning specified in Section 7.01(a)(iv) of
the Lease.
Debt Rate. The weighted average (based on Outstanding principal
amount) rate of interest on the Certificates issued pursuant to the Indenture.
Default. Any event or condition which, with the lapse of time or
the giving of notice, or both, would constitute an Event of Default.
Delivery Date. August 28, 1996.
Engine. Each of the two General Electric CF6-80C2-A5F engines
listed by manufacturer's serial numbers in the initial Lease Supplement and
leased pursuant to the Lease, whether or not from time to time installed on
the Airframe or installed on any other airframe or on any other aircraft, and
any Replacement Engine which may from time to time be substituted for an
Engine pursuant to Section 7.02(a)(vii), 10.02(c), 10.03, 11.03, 11.04 or
12.02 of the Lease, together with all Parts related thereto. Except as
otherwise provided, at such time as a Replacement Engine shall be so
substituted and the Engine for which the substitution is made shall be
released from the Lien of the Indenture, such replaced Engine shall cease to
be an "Engine" under the Lease. The term "Engines" means, as of any date of
determination, both Engines then leased to the Lessee pursuant to the Lease.
Engine Consent. The Engine Consent dated as of August 1, 1996,
executed by the Engine Manufacturer, as the same may be amended, modified or
supplemented from time to time.
Engine Manufacturer. General Electric Company, a New York
corporation.
Engine Warranty Assignment. The Engine Warranty Assignment
(Federal Express Corporation Trust No. N667FE), dated as of August 1, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan. An employee benefit plan subject to Title I of ERISA,
or an individual retirement account or plan subject to Section 4975 of the
Code.
Estimated Expense Amount. Has the meaning specified in Section
10.01(a) of the Participation Agreement.
Event of Default. Each of the events specified in Article 16 of
the Lease.
Event of Loss. Any of the following events with respect to the
Aircraft, the Airframe or any Engine: (i) loss of such property or its use (A)
for a period in excess of 60 days due to theft or disappearance or such longer
period, not to exceed 180 days from the end of such initial 60-day period, if
and so long as the location of such property is known to the Lessee and the
Lessee is diligently pursuing recovery of such property, or to the end of the
Term, if less (unless such theft or disappearance constitutes an Event of Loss
pursuant to (i)(B) or (ii) hereof) or (B) for a period in excess of 60 days
due to the destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use by Lessee for any reason whatsoever;
(ii) any damage to such property which results in an insurance settlement with
respect to such property on the basis of a total loss, or constructive or
compromised total loss; (iii) (1) condemnation, confiscation or seizure of, or
requisition of title to such property by the Government, any foreign
government or purported government or any agency or instrumentality thereof,
or (2) condemnation, confiscation, or seizure of, or requisition or taking of,
use of such property (A) by a foreign government or instrumentality or agency
of any such foreign government, for a period in excess of 180 days (or such
shorter period ending on the earlier of the expiration of the Term or on the
date on which an insurance settlement with respect to such property on the
basis of a total loss or constructive or compromised total loss shall occur)
or (B) by the Government for a period extending beyond the Term; and (iv) as a
result of any law, rule, regulation, order or other action by the Aeronautics
Authority or other governmental body having jurisdiction, the use of the
Aircraft or Airframe in the normal course of air transportation of cargo shall
have been prohibited by virtue of a condition affecting all Airbus A300-600
series aircraft equipped with engines of the same make and model as the
Engines for a period of twelve (12) consecutive months, unless the Lessee,
prior to the expiration of such twelve (12) month period, shall be diligently
carrying forward all steps which are necessary or desirable to permit the
normal use of the Aircraft or Airframe or, in any event, if such use of the
Aircraft or the Airframe shall have been prohibited for a period of
twenty-four (24) consecutive months or until the end of the Term, if earlier.
The date of such Event of Loss shall be (s) the 61st day or the 241st day, as
the case may be, following loss of such property or its use due to theft or
disappearance (or the end of the Term or the Lessee's abandonment of diligent
efforts to recover such property, if earlier); (t) the 61st day following the
date of any destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use; (u) the date of any insurance
settlement on the basis of a total loss or constructive or compromised total
loss; (v) the date of any condemnation, confiscation, seizure or requisition
of title of such property; (w) the 181st day following condemnation,
confiscation, seizure or requisition for use of such property by a foreign
government referred to in clause (iii)(2)(A) above (or the end of the Term or
the date of any insurance settlement described therein, if earlier than such
181st day); (x) the last day of the Term in the case of requisition for use of
such property by the Government; (y) the last day of the 12 month or 24 month
period, referred to in clause (iv) above (or if earlier, the end of the Term
or abandonment of the Lessee's efforts to restore the normal use of the
Aircraft). An Event of Loss with respect to the Aircraft shall be deemed to
have occurred if any Event of Loss occurs with respect to the Airframe. If an
Event of Loss described in any of clauses (i) (A), (iii) or (iv) above shall
occur, Lessor may elect, within 30 days following the date upon which such
Event of Loss is deemed to have occurred, to waive such Event of Loss and the
consequences thereof.
Excepted Payments. Collectively, (i) indemnity, expense,
reimbursement or other payments paid or payable by the Lessee in respect of
the Owner Participant, the Owner Trustee in its individual capacity or any of
their respective successors, permitted assigns, directors, officers,
employees, servants and agents or Affiliates, pursuant to the Participation
Agreement or any other Operative Agreement or any indemnity hereafter granted
to the Owner Participant or the Owner Trustee in its individual capacity
pursuant to the Lease or the Participation Agreement, (ii) proceeds of public
liability insurance (or government indemnities in lieu thereof) in respect of
the Aircraft payable as a result of insurance claims paid for the benefit of,
or losses suffered by, the Owner Trustee or the Indenture Trustee in their
respective individual capacities or by the Owner Participant, or their
respective successors, permitted assigns or Affiliates, (iii) proceeds of
insurance maintained with respect to the Aircraft by the Owner Participant
(whether directly or through the Owner Trustee) maintained in accordance with
Section 13.05 of the Lease but not required under Article 13 of the Lease,
(iv) payments of Supplemental Rent by the Lessee in respect of any amounts
payable under the Tax Indemnity Agreement, (v) any purchase price paid to the
Owner Participant for its interest in the Trust Estate pursuant to Section
7.03(d) of the Participation Agreement, (vi) subject to Section 3.05 of the
Lease, payments constituting increases in Basic Rent attributable to payments
arising pursuant to Section 5 of the Tax Indemnity Agreement, (vii) any
payments in respect of interest to the extent attributable to payments
referred to in clauses (i) through (vi) above and (viii) any right to demand,
collect or otherwise receive and enforce the payment of any amount described
in clauses (i) through (v) and (vii) above (except with respect to interest
attributable to payments referred to in clause (vi) above).
Expense; Expenses. Have the meaning specified in Section 9.01(a)
of the Participation Agreement.
FPO Price. Has the meaning set forth in Section 4.02(a)(F) of the
Lease.
FSB. First Security Bank, National Association, a national banking
association.
Fair Market Renewal Term. A term with respect to which the Lessee
has exercised its option to renew the Lease pursuant to the second paragraph
of Section 4.01(a) thereof and with respect to which the conditions set forth
in such Section 4.01(a) are met.
Fair Market Rental. An amount determined on the basis of, and
equal in amount to, the rental which would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and willing
lessor unaffiliated with such lessee, neither being under any compulsion to
lease. In such determination, it shall be assumed that the Aircraft is in the
condition required under the Lease in the case of return of the Aircraft
pursuant to Article 12 of the Lease and Fair Market Rental shall be determined
in accordance with the provisions of Section 4.03 of the Lease.
Fair Market Value. An amount determined on the basis of, and
equal in amount to, the value which would be obtained in an arm's-length
transaction between an informed and willing purchaser under no compulsion to
buy and an informed and willing seller unaffiliated with such purchaser and
under no compulsion to sell, assuming the Aircraft (or other property) is
unencumbered by the Lease. In such determination, except for purposes of
Section 17.01 of the Lease (when it shall be determined based upon the actual
condition and location of the Aircraft), it shall be assumed that the Aircraft
is in the condition required under the Lease in the case of return of the
Aircraft pursuant to Article 12 of the Lease and Fair Market Value shall be
determined in accordance with the provisions of Section 4.03 of the Lease.
Federal Aviation Administration; FAA. The United States Federal
Aviation Administration and any successor agency or agencies thereto.
Fixed Renewal Rent. Semi-annual payments of rent during the Fixed
Renewal Term equal to the lesser of (i) Fair Market Rental as determined as of
the commencement of such Fixed Renewal Term and (ii) 50% of the average actual
semi-annual Basic Rent payable during the Basic Term.
Fixed Renewal Term. The term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the first paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth in
such Section 4.01(a) are met.
French Pledge Agreement. The French Pledge Agreement dated as of
August 1, 1996 between the Owner Trustee and the Indenture Trustee.
Government. The United States of America or an agency or
instrumentality thereof the obligations of which bear the full faith and
credit of the United States of America.
GTA. The General Terms Agreement dated as of July 3, 1991 between
the Engine Manufacturer and the Lessee related to the purchase by the Lessee
of the Engines as originally executed or as modified, amended or supplemented
in accordance with the terms thereof, but only insofar as the General Terms
Agreement relates to the Engines, to the extent assigned to the Owner Trustee
pursuant to the Engine Warranty Assignment.
Holder of a Certificate; Certificate Holder; Holder. As of any
particular time, the Person in whose name a Certificate shall be registered
(but not including the holder of any Pass Through Certificate).
Indemnitee. Each of FSB, in its individual capacity and as Owner
Trustee and Lessor, the Agent (to the extent set forth in Articles 8 and 9 of
the Original Participation Agreement), the Owner Participant, the Original
Loan Participants (to the extent set forth in Articles 8 and 9 of the Original
Participation Agreement), the Indenture Trustee, in its individual capacity
and as trustee, any Owner Participant Guarantor, and any successor (including
any trustee which may succeed to the Lessor's interest under the Lease),
Affiliate, assign, officer, director, employee, agent and servant of any of
the foregoing, the Lessor's Estate and the Trust Indenture Estate. Neither
the Certificate Holder nor any holder of a Pass Through Certificate shall be
deemed to be an Indemnitee.
Indenture. The Trust Indenture and Security Agreement (Federal
Express Corporation Trust No. N667FE), dated as of August 1, 1996, as amended
and restated as of October 15, 1996, between the Lessor and the Indenture
Trustee, as supplemented by the Indenture and Security Agreement Supplement,
and as said Indenture may from time to time be further supplemented or
amended, including any amendment or supplement thereto entered into from time
to time pursuant to the applicable provisions of the Indenture.
Indenture and Security Agreement Supplement. The Indenture and
Security Agreement Supplement No. 1 (Federal Express Corporation Trust No.
N667FE) dated August 28, 1996, as such Indenture and Security Agreement
Supplement shall be amended or supplemented from time to time and any other
supplement to the Indenture, substantially in the form of Exhibit A to the
Indenture.
Indenture Default. Any event or condition which, with the lapse
of time or the giving of notice, or both, would constitute an Indenture Event
of Default.
Indenture Documents. Has the meaning specified in the Granting
Clause of the Indenture.
Indenture Event of Default. Each of the events specified in
Section 7.01 of the Indenture.
Indenture Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, not in its individual capacity but solely as
Indenture Trustee under the Indenture and each other Person which may from
time to time be acting as successor trustee under the Indenture.
Indenture Trustee's Liens. Any Lien on the Trust Indenture Estate
resulting from (i) claims against the Indenture Trustee not related to the
administration of the Trust Indenture Estate or any transactions pursuant to
the Indenture or any document included in the Trust Indenture Estate, (ii) any
act or omission of the Indenture Trustee which is not related to the
transactions contemplated by the Operative Agreements or is in violation of
any of the terms of the Operative Agreements or (iii) Taxes imposed against
the Indenture Trustee in its individual capacity in respect of which the
Lessee has not indemnified (and is not obligated to indemnify) the Indenture
Trustee in such capacity.
Independent Appraisal. An appraisal conducted pursuant to Section
4.03 of the Lease.
Independent Investment Banker. An independent investment banking
institution of national standing appointed by the Lessee that is independent
in fact, does not have any direct financial interests, or any material
indirect financial interest, in the Lessee or any Affiliate of the Lessee, and
is not connected with the Lessee or any Affiliate of the Lessee, as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions; provided, that if the Indenture Trustee shall
not have received written notice of such an appointment at least 10 days prior
to the Prepayment Date, "Independent Investment Banker" shall mean such an
institution appointed by the Indenture Trustee.
Interim Term. The period commencing on the Delivery Date and
ending at the end of the day immediately preceding the Commencement Date.
Invoice. The invoice for the Aircraft given by AVSA to the Lessor.
Lease. The Lease Agreement (Federal Express Corporation Trust No.
N667FE) dated as of August 1, 1996, as amended and restated as of October 15,
1996, entered into by the Lessor and the Lessee concurrently with the
execution and delivery of the Indenture, as said Lease may from time to time
be supplemented or amended, or its terms waived or modified, to the extent
permitted by, and in accordance with, the terms of the Indenture, including,
without limitation, supplementation by one or more Lease Supplements entered
into pursuant to the applicable provisions of the Lease.
Lease Supplement. The Lease Supplement No. 1 (Federal Express
Corporation Trust No. N667FE) dated August 28, 1996, as such Lease Supplement
shall be amended or supplemented from time to time and any other supplement to
the Lease, substantially in the form of Exhibit A to the Lease.
Lease Term. The period commencing on the Delivery Date and ending
at the end of the Basic Term.
Lessee. Federal Express Corporation, a Delaware corporation, and
its successors and permitted assigns.
Lessee Documents. Has the meaning set forth in Section 6.01(b) of
the Participation Agreement.
Lessor. First Security Bank, National Association, a national
banking association, not in its individual capacity but solely as Owner
Trustee under the Trust Agreement, and its successors and permitted assigns.
Lessor's Estate. All estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Participation Agreement, AVSA's FAA ▇▇▇▇ of Sale, AVSA's Warranty ▇▇▇▇ of
Sale, the Airbus Guaranty, the Purchase Agreement, the Purchase Agreement
Assignment, the Consent and Agreement, the AVSA Consent and Agreement, the
Consent and Guaranty (to the extent assigned by the Purchase Agreement
Assignment), any Ancillary Agreement, the GTA, the Engine Warranty Assignment,
the Engine Consent, any warranty with respect to the Airframe and the Engines,
all amounts of Basic Rent and Supplemental Rent, including without limitation,
insurance proceeds (other than insurance proceeds payable to or for the
benefit of the Owner Trustee in its individual capacity or the Owner
Participant) and requisition, indemnity or other payments of any kind for or
with respect to the Aircraft (except amounts owing to the Owner Participant,
to the Indenture Trustee, to the Owner Trustee in its individual capacity, or
to any of their respective directors, officers, employees and agents pursuant
to Articles 8 and 9 of the Participation Agreement), and all other property of
the Owner Trustee purportedly subjected to the Lien of the Indenture by the
Granting Clause thereof; provided that in no event shall "Lessor's Estate"
include any Excepted Payment.
Lessor's Liens. Liens on the Lessor's Estate or the Trust
Indenture Estate arising as a result of (i) claims against the Lessor, in its
individual capacity or as Owner Trustee, or the Owner Participant, in each
case not related to the transactions contemplated by the Operative Agreements,
(ii) acts or omissions of the Lessor in its individual capacity or as Owner
Trustee, and, in the case of the Lessor in its individual capacity, arising
from its gross negligence or willful misconduct or expressly prohibited under
the Operative Agreements and any act or omission of the Owner Participant
which is in violation of any of the terms of the Operative Agreements, (iii)
Taxes or Expenses imposed against the Lessor, in its individual capacity or as
Owner Trustee, Owner Participant, Lessor's Estate or the trust created by the
Trust Agreement which are not required to be indemnified against by the Lessee
pursuant to the Participation Agreement by reason of Section 8.01(b) or
9.01(b) thereof and which are not required to be indemnified against by the
Lessee pursuant to the Tax Indemnity Agreement, or (iv) claims against the
Lessor or the Owner Participant arising from the voluntary transfer by the
Lessor or the Owner Participant of its interests in the Aircraft other than a
transfer of the Aircraft pursuant to Section 4.02(a) or Article 10 or 11 of the
Lease and other than a transfer pursuant to the exercise of the remedies set
forth in Article 17 of the Lease.
Lien. Any mortgage, pledge, lien, charge, encumbrance, lease or
security interest or other similar interest.
Loss Payee. Has the meaning specified in Section 13.02(b)(i) of
the Lease.
Majority in Interest of Certificate Holders. As of a particular
date of determination, the Holders of more than 50% of the aggregate unpaid
principal amount of all Certificates outstanding as of such date excluding for
purposes of this definition any Certificates held by (i) the Owner Trustee or
the Owner Participant or any interests of the Owner Participant unless all
Certificates then outstanding shall be held by the Owner Participant, (ii) the
Lessee or (iii) any Affiliate of any thereof.
Make-Whole Premium. An amount determined as of the day before the
applicable Prepayment Date (or date of purchase, as the case may be) which an
Independent Investment Banker determines to be equal to the excess, if any, of
(i) the present values of all remaining scheduled payments of such principal
amount or portion thereof and interest thereon (excluding interest accrued
from the immediately preceding Payment Date to such Prepayment Date or date of
purchase, as the case may be) to the Maturity of such Certificate in
accordance with generally accepted financial practices assuming a 360-day year
consisting of twelve 30-day months at a discount rate equal to the Treasury
Yield, all as determined by the Independent Investment Banker over (ii) the
unpaid principal amount of such Certificate.
Manufacturer. Airbus Industrie G.I.E., a groupement d'interet
economique formed under the laws of France, and its successors and assigns.
Maturity. With respect to any Certificate, the date on which the
final principal amount of such Certificate is scheduled to be due and payable.
Moody's. ▇▇▇▇▇'▇ Investors Service, Inc.
Net Present Value of Rents. The net present value, as of the
Delivery Date, of Basic Rent set forth in Schedule II of the Lease, discounted
at a rate equal to the Debt Rate per annum compounded semi-annually.
Non-U.S. Person. Any Person other than a U.S. Person.
Obsolete Parts. Parts which are severable from the Aircraft in
accordance with clauses (ii) and (iii) of the proviso to Section 9.02(b) of
the Lease and the Lessee in good faith determines to be obsolete or no longer
suitable or appropriate for use on the Airframe or any Engine.
Officer's Certificate. When delivered pursuant to the Indenture, a
certificate signed by a Responsible Officer of the Lessee or the Owner
Trustee, as the case may be, and delivered to the Indenture Trustee. Each
such certificate shall include the statements provided for in Section 15.07 of
the Indenture.
Operative Agreements. The Participation Agreement, the Trust
Agreement, AVSA's FAA ▇▇▇▇ of Sale, AVSA's Warranty ▇▇▇▇ of Sale, the Airbus
Guaranty, the Purchase Agreement, the Purchase Agreement Assignment, the GTA,
the Engine Warranty Assignment, the French Pledge Agreement, the Lease, the
Lease Supplement, the Owner Participant Guaranty, if any, the Owner Trustee
Guaranty, if any, any Ancillary Agreement entered into by or with the written
consent of the Indenture Trustee, which by its terms is an Operative
Agreement, the Certificates outstanding at the time of reference, the
Indenture, the Indenture and Security Agreement Supplement, the Consent and
Agreement, the AVSA Consent and Agreement, the Consent and Guaranty (to the
extent assigned by the Purchase Agreement Assignment), the Engine Consent, the
Tax Indemnity Agreement and any Assignment and Assumption Agreement, each as
amended from time to time.
Opinion of Counsel. When delivered pursuant to the Indenture, a
written opinion of legal counsel, who in the case of counsel (a) for the
Lessee may be (i) an attorney employed by the Lessee who is generally
empowered to deliver such written opinions, (ii) ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ or a
successor firm or (iii) other counsel designated by the Lessee and reasonably
satisfactory to the Indenture Trustee and (b) for the Owner Trustee or the
Indenture Trustee, an attorney selected by such Person and, in the case of the
Owner Trustee, reasonably satisfactory to the Indenture Trustee.
Original Agreements. The documents and instruments delivered on
the Delivery Date in connection with the transactions contemplated by the
Original Participation Agreement.
Original Ancillary Agreement I. The Ancillary Agreement I (Federal
Express Corporation Trust No. N667FE), among the Lessee, the Owner
Participant, the Indenture Trustee and the Owner Trustee as it was originally
executed on the Delivery Date.
Original Indenture. The Trust Indenture, Mortgage and Security
Agreement (Federal Express Corporation Trust No. N667FE), dated as of August 1,
1996, between the Owner Trustee and the Indenture Trustee, which together with
the Indenture and Security Agreement Supplement No. 1 (Federal Express
Corporation Trust No. N667FE), dated August 28, 1996 attached thereto was
recorded as one instrument by the FAA on August 29, 1996, and assigned
Conveyance Number 2A269964.
Original Lease. The Lease Agreement (Federal Express Corporation
Trust No. N667FE), dated as of August 1, 1996, between the Owner Trustee as
lessor, and the Lessee, which together with Lease Supplement No. 1 (Federal
Express Corporation Trust No. N667FE), dated August 28, 1996 attached thereto
was recorded as one instrument by the FAA on August 29, 1996, and assigned
Conveyance Number 2A269965.
Original Loan Certificates. The loan certificates issued on the
Delivery Date to the Original Loan Participants.
Original Loan Participants. The entities listed on Schedule I to
the Original Participation Agreement and their successors and assigns (other
than any assignees in connection with the Refunding Date).
Original Participation Agreement. The Participation Agreement
(Federal Express Corporation Trust No. N667FE), among the Lessee, the Owner
Participant, the Indenture Trustee, the Owner Trustee and the Original Loan
Participants as it was originally executed as of August 1, 1996.
Original Tax Indemnity Agreement. The Tax Indemnity Agreement
(Federal Express Corporation Trust No. N667FE) between the Lessee and the Owner
Participant as it was originally executed as of August 1, 1996.
Original Trust Agreement. The Trust Agreement (Federal Express
Corporation Trust No. N667FE) between the Owner Participant and the Owner
Trustee as it was originally executed as of August 1, 1996 and filed with the
FAA on August 28, 1996.
Outstanding. When used with respect to Certificates, as of the
date of determination and subject to the provisions of Section 10.04 of the
Indenture, all Certificates theretofore executed and delivered under the
Indenture, with the exception of the following:
(i)Certificates theretofore cancelled by the Indenture Trustee or
delivered to the Indenture Trustee for cancellation pursuant to
Section 2.08 of the Indenture or otherwise;
(ii)Certificates for which prepayment money in the necessary amount
has been theretofore deposited with the Indenture Trustee in trust
for the Holders of such Certificates pursuant to Section 14.01 of
the Indenture; provided, that if such Certificates are to be
prepaid, notice of such prepayment has been duly given pursuant to
the Indenture or provision therefor satisfactory to the Indenture
Trustee has been made; and
(iii)Certificates in exchange for or in lieu of which other
Certificates have been executed and delivered pursuant to Article
II of the Indenture.
Owner Participant. The trustor originally named in the Trust
Agreement and any successor thereto, and any Person to which Owner Participant
transfers, in accordance with the Trust Agreement, its right, title and
interest in and to the Operative Agreements and the Lessor's Estate.
Owner Participant Guarantor. The provider of an Owner Participant
Guaranty.
Owner Participant Guaranty. Any guaranty delivered in compliance
with Section 7.03(d) of the Participation Agreement.
Owner Trustee. FSB, not in its individual capacity except as
otherwise expressly stated, but solely as Owner Trustee under the Trust
Agreement, and its successors and permitted assigns.
Owner Trustee Guarantor. The provider of an Owner Trustee
Guaranty.
Owner Trustee Guaranty. Any guaranty delivered in compliance with
Section 11.01(b)(ii) of the Participation Agreement.
Owner's Economic Return. The Owner Participant's anticipated net
after-tax book yield and aggregate after-tax cash during the Interim Term and
the Basic Term utilizing the multiple investment sinking fund method of
analysis, computed on the basis of the same methodology and assumptions as
were utilized by the Owner Participant in determining Basic Rent, Stipulated
Loss Value and Termination Value percentages, as the case may be, as such
assumptions may be adjusted for events which have been the basis of
adjustments to Rent pursuant to Section 3.04 of the Lease.
Participation Agreement. The Participation Agreement (Federal
Express Corporation Trust No. N667FE), dated as of August 1, 1996, as amended
and restated as of October 15, 1996, among the Lessee, the Original Loan
Participants, the Owner Trustee not in its individual capacity except as
otherwise expressly provided therein, but solely as owner trustee, the Owner
Participant, the Indenture Trustee not in its individual capacity except as
otherwise expressly provided therein, but solely as indenture trustee and the
Pass Through Trustee not in its individual capacity except as otherwise
expressly provided therein, but solely as pass through trustee, as amended,
modified or supplemented, or the terms thereof waived.
Parts. All appliances, parts, components, instruments,
appurtenances, accessories, furnishings and other equipment of whatever nature
(other than complete Engines or engines) which may from time to time be
incorporated or installed in or attached to the Airframe or any Engine or
title to which remains vested in the Lessor pursuant to Article 8 of the Lease.
Pass Through Agreement. The Pass Through Trust Agreement dated as
of June 1, 1996 between the Lessee and the Pass Through Trustee, as such Pass
Through Agreement may be modified, supplemented or amended from time to time in
accordance with the provisions thereof.
Pass Through Certificates. Any of the 1996 Pass Through
Certificates, Series B1 or 1996 Pass Through Certificates, Series B2, in each
case as issued by the related Pass Through Trust; and "Pass Through
Certificates" means both of the Pass Through Certificates issued by each of
the Pass Through Trusts.
Pass Through Closing Date. The Business Day on which the sale of
the Pass Through Certificates to the Underwriters pursuant to the Underwriting
Agreement takes place.
Pass Through Trust. The Federal Express Pass Through Trust,
1996-B1 or Federal Express Pass Through Trust, 1996-B2, in each case formed
pursuant to the related Series Supplement in accordance with the Pass Through
Agreement; and "Pass Through Trusts" means both of such Pass Through Trusts.
Pass Through Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, in its capacity as Pass Through Trustee under the
Pass Through Agreement and each Pass Through Trust, and its successors and
permitted assigns as Pass Through Trustee thereunder.
Past Due Rate. In respect of (A) any amount payable to the Owner
Participant or the Owner Trustee a rate per annum during the period from and
including the due date to but excluding the date on which such amount is paid
in full equal to 2% plus the Debt Rate and (B) any principal of or interest on
any Certificate or any other amount payable under the Indenture, any
Certificate or any other Operative Agreement that is not paid when due
(whether at Maturity, by acceleration, by optional or mandatory prepayment or
otherwise) to any Holder, the Indenture Trustee or the Pass Through Trustee, a
rate per annum during the period from and including the due date to but
excluding the date on which such amount is paid in full equal to (i) in the
case of any such amount payable to the Holder of any Certificate, 2% plus the
interest rate applicable to such Certificate and (ii) in the case of any other
such amount, 2% plus the Debt Rate.
Payment Date. November 28, 2019 and each January 30 and July 30
commencing on January 30, 1997.
Payment Default. Any event specified in Section 16.01(a) or
16.01(b) of the Lease which with the giving of notice or lapse of time or both
would constitute an Event of Default.
Permitted Investments. Those investments enumerated in Section
23.01(a) (i), (ii), (iii) and (iv) of the Lease.
Person. Any individual, sole proprietorship, partnership, joint
venture, joint stock company, trust, unincorporated organization, association,
corporation, institution, entity or government (federal, state, local, foreign
or any agency, instrumentality, division or body thereof).
Preliminary Notice. Has the meaning specified in Section 4.01(a)
of the Lease.
Premium Termination Date. With respect to the Certificates having
a Maturity in 2012, October 23, 2006 and with respect to the Certificates
having a Maturity in 2018, June 23, 2016.
Prepayment Date. Has the meaning specified in Section 6.02(b) of
the Indenture.
Prepayment Price. Has the meaning specified in Section 6.02(b) of
the Indenture.
Property. Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
Proposed Termination Date. The proposed date of termination of the
Lease as specified by the Lessee in its notice given pursuant to Section 10.01
thereof.
Purchase Agreement. The Airbus A300-600R Freighter Purchase
Agreement, dated as of July 3, 1991 between AVSA and the Lessee, including all
exhibits, appendices and letter agreements attached thereto as originally
executed or as modified, amended or supplemented in accordance with the terms
thereof, but only to the extent that the foregoing relates to the Aircraft and
to the extent assigned pursuant to the Purchase Agreement Assignment.
Purchase Agreement Assignment. The Purchase Agreement Assignment
(Federal Express Corporation Trust No. N667FE), dated as of August 1, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
Purchase Price. The amount specified as such in Ancillary
Agreement II.
Record Date. With respect to Payment Dates under the Indenture
(except a date for payment of defaulted interest), January 15 for January 30
Payment Dates and July 15 for July 30 Payment Dates, whether or not such date
is a Business Day.
Recourse Amount. Has the meaning specified in Section 17.10 of the
Participation Agreement.
Refinancing. A non-recourse loan to the Lessor arranged pursuant
to Section 15.01 of the Participation Agreement.
Refunding Date. A Business Day on which the refunding of the
Original Loan Certificates occurs, the expected date thereof having been
specified by the Lessee in a written notice given to the parties to the
Participation Agreement and the Underwriters at least three (3) Business Days
prior to such expected Refunding Date.
Register. Has the meaning set forth in Section 3.02 of the
Indenture.
Registrar. Has the meaning set forth in Section 3.02 of the
Indenture.
Regulation D. Regulation D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
Remaining Weighted Average Life. For any Certificate, as of any
determination date, the number of years obtained by dividing (a) the sum of the
products obtained by multiplying (i) the amount of each then remaining
mandatory sinking fund redemption payment of principal, including the payment
due on the Maturity of such Certificate, by (ii) the number of years
(calculated to the nearest one-twelfth) which will elapse between such
determination date, and the date on which such payment is scheduled to be
made, by (b) the then outstanding principal amount of such Certificate.
Renewal Rent. The amount payable by the Lessee as rent in
accordance with Section 4.01 of the Lease during any Renewal Term.
Renewal Term. One or more terms with respect to which the Lessee
has exercised its option to renew the Lease pursuant to Section 4.01(a)
thereof.
Rent. All payments due from the Lessee under the Lease as Basic
Rent, Renewal Rent and Supplemental Rent, collectively.
Rent Payment Date. November 28, 2019 and each January 30 and July
30 commencing on January 30, 1997.
Reoptimization Date. Has the meaning specified in Section
15.02(a) of the Participation Agreement.
Replacement Aircraft. Any aircraft substituted for the Aircraft
pursuant to Section 11.03(a) of the Lease.
Replacement Airframe. Has the meaning set forth in Section 11.03
of the Lease.
Replacement Engine. A General Electric CF6-80C2-A5F engine (or an
engine of the same or another manufacturer) of equal or greater value,
airworthiness, remaining useful life and utility as the Engine being replaced,
together with all Parts relating to such engine; provided, however, that if
such replacement engine is not a General Electric CF6-80C2-A5F engine, such
replacement engine must then be commonly used in the commercial aviation
industry on Airbus A300-600 airframes.
Responsible Officer. With respect to the Owner Trustee (except for
purposes of the Trust Agreement in which case the definition of Responsible
Officer set forth in Section 3.10 of the Trust Agreement is applicable) or the
Indenture Trustee, any officer in its Corporate Trust Administration, as the
case may be, designated by such Person to perform obligations under the
Operative Agreements, and with respect to any other party, any corporate
officer or (except in the case of the Owner Participant) other employee of a
party who, in the normal performance of his or her operational
responsibilities, with respect to the subject matter of any covenant,
agreement or obligation of such party pursuant to any Operative Agreement,
would have responsibility for and knowledge of such matter and the
requirements of any Operative Agreement with respect thereto.
S&P. Standard & Poor's Ratings Group.
SEC. The Securities and Exchange Commission of the United States
and any successor agencies or authorities.
SSB. State Street Bank and Trust Company, a Massachusetts trust
company.
Securities Act. The Securities Act of 1933, as amended.
Series Supplement. The Series Supplement 1996-B1 to be executed
and delivered by the Lessee and the Pass Through Trustee or the Series
Supplement 1996-B2 to be executed and delivered by the Lessee and the Pass
Through Trustee, in each case as such Series Supplement may be modified,
supplemented or amended from time to time in accordance with the provisions
thereof and "Series Supplements" means both such Series Supplements.
Sinking Fund Redemption Date. Has the meaning specified in Section
6.06 of the Indenture.
Sinking Fund Redemption Price. Has the meaning specified in
Section 6.06 of the Indenture.
Special Aviation Counsel. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇.
Stipulated Loss Value. As of any Stipulated Loss Value
Determination Date during the Basic Term, the amount determined by multiplying
the Purchase Price by the percentage set forth in Schedule III of the Lease
under the heading "Stipulated Loss Value Factor" opposite such date (as such
Schedule III may be adjusted from time to time as provided in Section 3.04 of
the Lease), and during any Renewal Term, the amount determined pursuant to
Section 4.01(b) of the Lease. Notwithstanding any other provisions of the
Lease or the Participation Agreement or the Indenture, each Stipulated Loss
Value for the Aircraft shall be, under any circumstances and in any event, an
amount, together with so much of the arrears portion of Basic Rent due and
owing through the date of payment of Stipulated Loss Value as does not
constitute an Excepted Payment, at least sufficient to pay in full as of such
date of payment the aggregate unpaid principal amount of and accrued interest
on the Certificates outstanding on such date of payment. Subject to the
immediately preceding sentence, it is understood and agreed that the amounts
set forth on Schedule III of the Lease, for dates other than Rent Payment
Dates on which arrears Basic Rent is due, fully reflect appropriate Basic Rent
accruals and credits of unearned Basic Rent through such date and,
accordingly, no further accrual or credit shall be required through such date
whenever Stipulated Loss Value is to be calculated with reference to any such
date; provided that if amounts in respect of Stipulated Loss Value are payable
under the Operative Agreements after the Stipulated Loss Determination Date in
respect of which such Stipulated Loss Value was determined, the Lessor shall
be compensated during the period from the Stipulated Loss Determination Date
to such payment date in accordance with the provisions of the Operative
Agreements.
Stipulated Loss Value Determination Date. Each date set forth on
Schedule III of the Lease under the heading "Stipulated Loss Value Date."
Supplemental Rent. All amounts, liabilities and obligations which
the Lessee assumes or agrees to perform or pay under the Lease or under the
Participation Agreement or Tax Indemnity Agreement or any Ancillary Agreement
or any other Operative Agreement to the Lessor, the Owner Participant, the
Indenture Trustee or others, including, without limitation, payments of
Stipulated Loss Value, FPO Price and amounts calculated by reference to
Termination Value, any amounts of Make-Whole Premium payable under the
Indenture to the extent provided in Section 3.03 of the Lease, and all amounts
required to be paid by Lessee under the agreements, covenants and indemnities
contained in the Lease or in the Participation Agreement or the Tax Indemnity
Agreement or any other Operative Agreement, but excluding Basic Rent.
Tax. Has the meaning set forth in Section 8.01(a) of the
Participation Agreement.
Tax Indemnity Agreement. The Original Tax Indemnity Agreement as
amended by Amendment No. 1 to the Original Tax Indemnity Agreement, as from
time to time modified, amended or supplemented pursuant to its applicable
provisions.
Term. The Interim Term and the Basic Term of the lease for the
Aircraft under the Lease and, if renewed pursuant to Section 4.01 of the
Lease, each Renewal Term for the Aircraft for which the Lease is renewed, or
such earlier date on which the Lease is terminated pursuant to its terms.
Termination Date. A Rent Payment Date during the Basic Term that
is on or after December 31, 2003 in the case of Article 10 of the Lease, and
in the case of (i) Section 4.02(a)(A) of the Lease, the Rent Payment Date
falling on January 30, 2015, (ii) Section 4.02(a)(D) or (E) of the Lease, a
Rent Payment Date that is on or after the seventh anniversary of the
Commencement Date and (iii) Section 4.02(a)(F) of the Lease, the last day of
the Basic Term.
Termination Value. As of any Termination Date, the amount
determined by multiplying the Purchase Price by the percentage set forth in
Schedule IV of the Lease under the heading "Termination Value Factor" opposite
such Termination Date (as such Schedule IV may be adjusted from time to time
as provided in Section 3.04 of the Lease). Notwithstanding any other
provisions of the Lease, the Participation Agreement or the Indenture, each
Termination Value shall be, under any circumstances and in any event, an
amount, together with so much of the arrears portion of Basic Rent due and
owing through the date of payment of any amount calculated by reference to
Termination Value as does not constitute an Excepted Payment, at least
sufficient to pay in full as of such date of payment the aggregate unpaid
principal amount of and accrued interest on the Certificates outstanding on
such date of payment. Subject to the immediately preceding sentence, it is
understood and agreed that the amounts set forth on Schedule IV of the Lease,
for dates other than Rent Payment Dates on which arrears Basic Rent is due,
fully reflect appropriate Basic Rent accruals and credits of unearned Basic
Rent through such date and, accordingly, no further accrual or credit shall be
required through such date whenever Termination Value is to be calculated with
reference to any such date; provided that if amounts in respect of Termination
Value are payable under the Operative Agreements after the Termination Date in
respect of which such Termination Value was determined, the Lessor shall be
compensated during the period from the Termination Date to such payment date
in accordance with the provisions of the Operative Agreements.
Transaction Costs. Those costs and expenses set forth in Section
10.01(a) of the Participation Agreement.
Transportation Code. Title 49 of the United States Code, as
amended and in effect on the date of the Lease or as subsequently amended, or
any successor or substituted legislation at the time in effect and applicable,
and the regulations promulgated pursuant thereto.
Treasury Yield. (i) In the case of a Certificate having a
Maturity within one year after the Prepayment Date the average yield to
maturity on a government bond equivalent basis of the applicable United States
Treasury ▇▇▇▇ due the week of Maturity of such Certificate and (ii) in the
case of a Certificate having a Maturity one year or more after the Prepayment
Date, the average yield of the most actively traded United States Treasury
Note (as reported by Cantor ▇▇▇▇▇▇▇▇▇▇ Securities Corp. on page 5 of Telerate
Systems, Inc., a financial news service, or if such report is not available,
a source deemed comparable by the Independent Investment Banker selected to
determine the Make-Whole Premium and reasonably acceptable to the Lessee)
corresponding in maturity to the Remaining Weighted Average Life of such
Certificate (or, if there is no corresponding maturity, an interpolation of
maturities by the Independent Investment Banker), in each case determined by
the Independent Investment Banker selected to determine the Make-Whole Premium
based on the average of the yields to stated maturity determined from the bid
prices as of 10:00 a.m. and 2:00 p.m. New York time, on the second Business
Day preceding the Prepayment Date.
Trust Agreement. The Trust Agreement (Federal Express Corporation
Trust No. N667FE), dated as of August 1, 1996, as amended and restated as of
October 15, 1996, between the Owner Participant and the Owner Trustee in its
individual capacity, as from time to time modified, amended or supplemented
pursuant to its applicable provisions and in accordance with the Operative
Agreements.
Trust Estate. The Lessor's Estate.
Trust Indenture Act. The Trust Indenture Act of 1939, as amended.
Trust Indenture Estate. All estate, right, title and interest of
the Indenture Trustee in and to any of the property, rights, interests and
privileges granted to the Indenture Trustee pursuant to the Granting Clause of
the Indenture, other than Excepted Payments and any and all other rights of
the Owner Trustee or the Owner Participant expressly reserved to the Owner
Trustee or the Owner Participant pursuant to the Indenture.
Underwriters. ▇▇▇▇▇▇▇, Sachs & Co., ▇.▇. ▇▇▇▇▇▇ Securities Inc.,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, BA Securities, Inc. and First Chicago
Capital Markets, Inc.
Underwriting Agreement. The Underwriting Agreement dated October
17, 1996 among the Lessee and the Underwriters.
United States, U.S. or US. The United States of America.
U.S. Air Carrier. Any United States air carrier as to which there
is in force a certificate issued pursuant to Section 41102(a) or Section 41103
of the Transportation Code, and as to which there is in force an air carrier
operating certificate issued pursuant to Chapter 447 of the Transportation
Code and Part 121 of the regulations under such Transportation Code, for
aircraft capable of carrying ten (10) or more individuals or 6,000 pounds or
more of cargo, or which may operate as an air carrier by certification or
otherwise under any successor or substitute provision thereof or in absence
thereof.
U.S. Person. A Person described in Section 7701(a)(30) of the
Code.
SCHEDULE III
PERMITTED COUNTRY LIST
Australia Netherlands
Austria New Zealand
Belgium Norway
Canada Philippines
Denmark Portugal
Finland Republic of China
(Taiwan)
France
Singapore
Germany
Sweden
Greece
Switzerland
Iceland
Thailand
Ireland
United Kingdom
Japan
Luxembourg
EXHIBIT A(1)(a)
[Letterhead of Federal Express]
[Refunding Date]
To the Addressees Listed on Schedule A Attached
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
I am the Vice President - Law of Federal Express Corporation, a
Delaware corporation ("Federal"), and am familiar with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N667FE), dated as of August 1, 1996, as amended and restated as of October
15, 1996 (the "Participation Agreement"), among Federal, as Lessee, PMCC
Leasing Corporation, as Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company of
New York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as Original Loan Participants, First Security Bank, National Association, a
national banking association, not in its individual capacity, except as
otherwise stated, but solely as Owner Trustee under the Trust Agreement, State
Street Bank and Trust Company, a Massachusetts trust company, not in its
individual capacity, except as otherwise stated, but solely as Indenture
Trustee under the Indenture and State Street Bank and Trust Company, as Pass
Through Trustee, relating to the Aircraft. This opinion is being delivered
pursuant to Section 4.01(l)(i) of the Participation Agreement. Capitalized
terms not otherwise defined herein have the meaning assigned thereto in the
Participation Agreement.
The Participation Agreement provides, among other things, for the
refinancing in full of the Original Loan Certificates evidencing the Original
Loan Participants' participation in the payment of the Purchase Price of one
Airbus A300F4-605R aircraft (the "Aircraft"), using the proceeds from the
public offering of the Pass Through Certificates. Two Series of Pass Through
Certificates will be issued by two Pass Through Trusts formed to acquire,
among other securities, the Certificates bearing a particular interest rate
and having a particular Maturity that will be issued under the Trust Indenture
and Security Agreement (Federal Express Corporation Trust No. N667FE) dated as
of August 1, 1996, as amended and restated as of October 15, 1996, as
supplemented by the related Indenture and Security Agreement Supplement
("Indenture"), between the Owner Trustee and the Indenture Trustee.
In connection with the opinions expressed below, I have examined or
caused to be examined by attorneys under my supervision, executed counterparts
of the Operative Agreements, the Pass Through Agreement and each Series
Supplement (the "Transaction Agreements"). We have relied upon originals or
copies, certified or otherwise identified to our satisfaction, of such
corporate records, documents and other instruments as in our judgment are
relevant to rendering the opinions expressed below. As to any facts material
to the opinions expressed below (other than any thereof relating to Federal),
we have relied upon the representations and warranties made in the Transaction
Agreements, the accuracy of which we have not independently investigated or
verified. In such examination, we have assumed the genuineness of all
signatures (other than the signatures of Federal) and the authenticity of all
documents submitted to us as originals and the conformity with the originals of
all documents submitted to us as copies. We have also assumed that each of the
parties to each of the Transaction Agreements, other than Federal, has full
power, authority and legal right to enter into such Transaction Agreements and
that each such Transaction Agreement has been duly authorized, executed and
delivered by each of such parties.
Based on the foregoing, it is my opinion that:
1. Federal is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has or had, on the date of execution thereof, the
corporate power and authority to carry on its business as currently conducted
and to enter into and perform its obligations under the Transaction Agreements
to which it is a party. Federal is duly qualified to do business and is in
good standing in the State of Tennessee and each other state of the United
States in which its operations or the nature of its business requires Federal
to so qualify, except where the failure to so qualify would not have a
material adverse impact on Federal or its business.
2. Federal possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents which are material to
the operation of the routes flown by it and the conduct of its business and
operations as currently conducted, and each such certificate, franchise,
license, permit, right and concession and consent is in full force and effect.
3. Each of the Transaction Agreements to which Federal is a party
has or had, on the date of execution thereof, been duly authorized, executed
and delivered by Federal and each constitutes the legal, valid and binding
obligation of Federal enforceable against Federal in accordance with its terms.
4. Neither the execution and delivery by Federal of the Transaction
Agreements to which Federal is a party, nor the consummation of any of the
transactions by Federal contemplated thereby, nor the performance of the
obligations thereunder by Federal, did at the time of execution and delivery,
or does presently (a) require any stockholder approval or violate the
Certificate of Incorporation or By-laws of Federal or (b) conflict with or
contravene the provisions of, or constitute a default under, or result in the
creation of any Lien (other than Liens permitted under Section 6.01(a) of the
Lease) upon the property of Federal under any law, governmental rule or
regulation, or the charter or bylaws of Federal or any order, writ, injunction
or decree of any court or governmental authority against Federal or by which
any of its properties may be bound or any indenture, mortgage, contract or
other agreement known to me to which Federal is a party or by which it may be
bound or, require the approval or consent of any trustee or the holders of any
indebtedness or obligations of Federal.
5. Neither the execution and delivery by Federal of the Transaction
Agreements to which it is a party, nor the consummation of any transactions by
Federal contemplated thereby, nor the performance of the obligations
thereunder by Federal, did or does, as the case may be, (a) require the
consent or approval of, the giving of notice to, or (except as described or
contemplated in the Participation Agreement and the Lease, all of which are
required to be performed on or prior to the Refunding Date and which shall
have been accomplished on or prior to the Refunding Date) the registration
with, or the taking of any other action in respect of, the Aeronautics
Authority, the Securities and Exchange Commission or any other authority or
agency of the federal government or of the State of Tennessee other than (i)
the registration of the issuance and sale of the Pass Through Certificates
under the Securities Act, (ii) compliance with the securities laws of each
applicable state, and (iii) the filing of the Indenture, the Lease and the
Trust Agreement with the FAA, or (b) contravene any judgment or order
applicable to or binding on Federal or any law or governmental rule or
regulation of the United States or of the State of Tennessee.
6. There is no pending, or to my knowledge, threatened action or
proceeding before any court or administrative agency which individually (or in
the aggregate in the case of any group of related lawsuits) (i) is expected to
have a material adverse effect on (A) except for the matters described under
"Legal Proceedings" in Federal's Annual Report on Form 10-K for the fiscal
year ended May 31, 1996 (as updated by Note 7 to the financial statements
included in Federal's Quarterly Report on Form 10-Q for the fiscal quarter
ended August 31, 1996) and in Federal's Current Reports on Form 8-K dated June
7, 1996 and August 16, 1996, as to which I can express no opinion at this time
concerning Federal's liability (if any) or the effect of any adverse
determination upon the business, condition (financial or otherwise) or
operations of Federal, the financial condition of Federal or (B) the ability
of Federal to perform its obligations under the Transaction Agreements, or
(ii) involves the Aircraft.
7. Except for the filing and, where appropriate, recording,
pursuant to the Transportation Code of the Lease, the Indenture, the Trust
Agreement, the filing of the financing statements referred to in Section
4.01(f) of the Participation Agreement and the taking of possession by the
Indenture Trustee of the original counterpart of the Lease and maintaining
possession of the original counterpart of the Lease Supplement delivered on
the Delivery Date, no further action, including any filing or recording of any
document is necessary or advisable in order to establish and perfect the Owner
Trustee's title to and interest in the Aircraft as against Federal and any
third parties, or to perfect the first mortgage lien on the Aircraft in favor
of the Indenture Trustee in each case with respect to such portion of the
Aircraft as is covered by the recording system established by the
Transportation Code.
8. Federal is a duly certificated "air carrier" within the meaning
of the Transportation Code, and a holder of a certificate under Sections
41102(a) and 41103 of the Transportation Code, and an "air carrier operating
certificate" issued under Chapter 447 of the Transportation Code for aircraft
capable of carrying ten (10) or more individuals or 6,000 pounds or more of
cargo, and each such certificate is in full force and effect.
9. On the Delivery Date the Owner Trustee received good and valid
title to the Aircraft free and clear of all Liens on file with the FAA, except
for Liens permitted under Section 6.01(a) of the Lease. Pursuant to the
Original Participation Agreement the Aircraft was duly delivered to the Owner
Trustee. Federal, as Lessee, duly accepted the Aircraft under the Original
Lease and the Lease Supplement and the Term commenced on the Delivery Date.
10. Federal's principal place of business and chief executive
office (as such term is defined in the Uniform Commercial Code in effect in
the State of Tennessee) are located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇.
11. Federal is not, and is not directly or indirectly controlled by
or acting on behalf of any Person which is, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
The opinions expressed in paragraph 3 above as to the enforceability
of the Transaction Agreements to which Federal is a party are based upon the
assumption for purposes of such opinions and without independent analysis
that, notwithstanding the respective choice of laws clauses in the Transaction
Agreements, the governing law with respect to each of the Transaction
Agreements is identical in all relevant respects to the law of the State of
Tennessee. Insofar as the foregoing opinion relates to the enforceability of
any instrument, such enforceability is subject to applicable bankruptcy,
insolvency and other similar laws affecting the enforcement of creditors'
rights generally (whether such enforceability is considered in a proceeding in
equity or at law). The enforceability of the remedies provided under the
Lease may also be limited by applicable laws which may affect the remedies
provided therein but which do not in my opinion affect the validity of the
Lease or make such remedies inadequate for the practical realization of the
benefits intended to be provided thereby.
I do not express any opinion as to matters governed by any law other
than the Federal laws of the United States of America, the corporation law of
the State of Delaware and the laws of the State of Tennessee.
As to the matters referred to in paragraphs 5, 7 and 9, I have relied
on the opinion of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ of even date herewith, to the
extent such matters are addressed in such counsel's opinion and subject to the
assumptions and qualifications expressed therein.
This opinion is delivered to you solely for your use in connection
with the transaction described herein, and may not be used for any other
purpose, and may not be relied upon by any other person, without my prior
written consent.
I rendered an opinion dated August 28, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. I hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
SCHEDULE A
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(1)(b)
[Letterhead of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Parties named on Schedule A Hereto
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
We have acted as special counsel for Federal Express Corporation, a
Delaware corporation ("Federal Express"), in connection with the transactions
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N667FE), dated as of August 1, 1996, as amended and restated as of October
15, 1996 (the "Participation Agreement"), among Federal Express, as Lessee,
PMCC Leasing Corporation, as Owner Participant, ▇▇▇▇▇▇ Guaranty Trust Company
of New York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as the Original Loan Participants, First Security Bank, National Association,
not in its individual capacity but solely as Owner Trustee under the Trust
Agreement, State Street Bank and Trust Company, not in its individual
capacity, except as otherwise stated, but solely as Indenture Trustee under
the Indenture, and State Street Bank and Trust Company, as Pass Through
Trustee, relating to the Aircraft. This opinion is being delivered pursuant
to Section 4.01(l)(viii) of the Participation Agreement. Capitalized terms
not otherwise defined herein have the meanings assigned thereto in the
Participation Agreement.
Pursuant to the Original Participation Agreement, the Owner
Participant and the Original Loan Participants participated in the payment of
the Purchase Price of one Airbus A300F4-605R Aircraft which was purchased by
the Owner Trustee pursuant to AVSA's FAA ▇▇▇▇ of Sale and AVSA's Warranty ▇▇▇▇
of Sale, subjected to the Lien of the Original Indenture and leased to Federal
Express under the Original Lease. The Participation Agreement provides, among
other things, for the refinancing of the Original Loan Certificates using the
proceeds from the public offering of the Pass Through Certificates. Two
Series of Pass Through Certificates will be issued by separate Pass Through
Trusts, each formed to acquire, among other securities, the Certificates
bearing a particular interest rate and having a particular Maturity that will
be issued under the Indenture.
In connection with the opinions expressed below, we have examined
executed counterparts of the Operative Agreements, the Pass Through
Certificates, the Pass Through Agreement and each Series Supplement (the
"Transaction Agreements"). We have also examined originals, or copies
certified to our satisfaction, of such other agreements, documents,
certificates and statements of governmental officials and corporate officers
as we have deemed necessary or advisable as a basis for such opinions. In
such examination, we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
As to any facts material to our opinions expressed below, we have,
with your consent, relied on the representations and warranties made in or
pursuant to the Participation Agreement and the other documents referred to
therein, the accuracy of which we have not independently verified. In
addition, we have, when relevant facts were not independently established by
us, relied, to the extent we deemed such reliance proper, upon certificates of
public officials and certificates, telegrams and other written or telephoned
statements of officers of the parties referred to herein.
Based on the foregoing, it is our opinion that:
1. With respect to that portion, if any, of the Aircraft and the
other property included in the Lessor's Estate as may not be covered by the
recording system established by the FAA pursuant to Section 44107 of the
Transportation Code, no filing or recording of any document or other action
was or is necessary in order to establish the Owner Trustee's title thereto
and interest therein as against Federal Express and any third parties.
2. The Lease creates a valid leasehold interest in the Aircraft,
the entitlement thereof to the benefits of recordation under the
Transportation Code being subject to the due and timely filing and, where
appropriate, recording of (A) the Lease (with the Indenture attached as an
exhibit), (B) the Indenture and (C) the Trust Agreement.
3. Assuming (i) the due authorization, execution and delivery of
the Transaction Agreements by each of the parties to each such document (other
than Federal Express), (ii) each such party has full power and legal right to
enter into and perform its respective obligations under the Transaction
Agreements, (iii) that the execution, delivery and performance by each of the
Transaction Agreements by each of the parties thereto will not violate the
respective parties' constituent documents, (iv) the due authorization,
execution, issuance and delivery by the Owner Trustee, and the due
authentication by the Indenture Trustee, of the Certificates to be issued
under the Indenture in accordance with the terms of the Indenture, (v) that
the Original Loan Certificates are delivered by the Original Loan Participants
to the Indenture Trustee for cancellation and are cancelled, (vi) the due
authorization, execution, issuance, delivery and authentication by the Pass
Through Trustee of the Pass Through Certificates to be issued under the Pass
Through Agreement and the Series Supplement relating to such Pass Through
Certificates, in each case in accordance with the terms of the Pass Through
Agreement and such Series Supplement, and (vii) that the form of each
Transaction Agreement is in compliance with all applicable laws and
governmental rules and regulations (other than the laws of the United States
and the State of New York), then: (A) to the extent governed by New York law,
each Transaction Agreement in form constitutes a legal, valid and binding
agreement of each party thereto enforceable against each such party in
accordance with its terms; (B) the Original Indenture created, and the
Indenture creates, for the benefit of the Holders, the security interest in
the Trust Indenture Estate that they purport to create; (C) the Certificates,
when issued to and acquired by the Pass Through Trustee, will be legal, valid
and binding obligations of the Owner Trustee enforceable against the Owner
Trustee in accordance with their terms and the terms of the Indenture and will
be entitled to the benefits of the Indenture, including the benefit of the
security interest created thereby; (D) the Pass Through Certificates, when
issued to and acquired by the Underwriters in accordance with the Underwriting
Agreement, will be legal, valid and binding obligations of the Pass Through
Trustee enforceable against the Pass Through Trustee in accordance with their
terms and will be entitled to the benefits of the Pass Through Agreement and
the Series Supplement relating thereto; and (E) the beneficial interest of the
Owner Participant under the Trust Agreement in and to the properties which are
part of the Trust Indenture Estate is subject, to the extent provided in the
Indenture, to the Lien of the Indenture in favor of the Holders. The opinions
set forth in this paragraph 3 are subject to the due filing and, where
appropriate, recording with the FAA of the documents referred to in paragraph
2 above.
4. (a) Each of the Transaction Agreements to which Federal Express
is a party has been duly authorized, executed and delivered by Federal Express.
(b) The execution, delivery and performance by Federal Express of
each of the Transaction Agreements to which Federal Express is a party do not,
or did not on the date of execution thereof, violate, and fully comply, or did
fully comply on the date of execution thereof, with, any laws and governmental
rules and regulations of the State of New York that may be applicable to
Federal Express. The opinion set forth in this paragraph 4(b) is rendered
without regard to the taking of any action or the conduct of any other
business by Federal Express in the State of New York other than the
transactions contemplated by the Transaction Agreements.
5. The execution, delivery and performance of the Participation
Agreement, the Trust Agreement, the Indenture and the Lease by the Owner
Trustee in its individual or trust capacity, as the case may be, and the
issuance, execution, delivery and performance of the Certificates by the Owner
Trustee in its trust capacity do not violate, and fully comply with, any laws
and governmental rules and regulations of the State of New York that may be
applicable to the Owner Trustee in its individual or trust capacity, as the
case may be. The opinion set forth in this paragraph 5 is rendered without
regard to the effect, if any, on such issuance (in the case of the
Certificates), execution, delivery or performance, of the taking of any
action, the conduct of any business or the exercise of any other powers by
First Security Bank, National Association in its individual or trust capacity
in the State of New York not related to the transactions contemplated by the
Transaction Agreements. We have assumed that First Security Bank, National
Association has made the filings necessary to comply with Section 131.3 of the
Banking Law of the State of New York, however we express no opinion as to
whether First Security Bank, National Association is required to comply with
said Section 131.3.
6. All the properties which are part of the Trust Indenture Estate
(including all right, title and interest of the Owner Trustee pledged and
mortgaged by it pursuant to the Indenture in and to the Aircraft and the
Lease) have been pledged and mortgaged with the Indenture Trustee as part of
the Trust Indenture Estate (subject to the due filing and, where appropriate,
recording of those documents referred to in paragraph 2 above and the
financing statements referred to in Section 4.01(f) of the Participation
Agreement), and the beneficial interest of the Owner Participant under the
Trust Agreement in and to such properties are subject, to the extent provided
in the Indenture, to the Lien of the Indenture in favor of the Holders of the
Certificates issued and to be issued under the Indenture.
7. The Indenture creates, as security for the Certificates duly
issued and to be issued under the Indenture, the first priority security
interest in the Aircraft it purports to create, the perfection and rank
thereof being subject to the registration with the FAA of the Aircraft in the
name of the Owner Trustee and the due filing and, where appropriate, recording
in accordance with the Transportation Code of the documents referred to in
paragraph 2 above. We express no opinion with respect to the status of any
security interest in any portion of the Aircraft which does not constitute an
"aircraft" or "aircraft engine", as defined in paragraphs (6) and (7) of
Section 40102(a) of the Transportation Code.
8. Federal Express's participation in the transactions
contemplated by the Transaction Agreements does not and will not constitute a
violation of Section 7 of the Securities Exchange Act of 1934.
9. Except for the filings and recordings referred to in paragraph
2 above, neither the execution and delivery by Federal Express of the
Participation Agreement or any other Operative Agreement to which it is a
party, nor the consummation of any of the transactions by Federal Express
contemplated thereby, requires the consent or approval of, the giving of
notice to, or the registration with, or the taking of any other action in
respect of, the Department of Transportation, the FAA, the Securities and
Exchange Commission or any other Federal or New York State governmental
authority.
10. It is not necessary, in connection with the creation of the
beneficial interest of the Owner Participant in the Trust Indenture Estate
under the circumstances contemplated by the Participation Agreement to
register such beneficial interest under the Securities Act of 1933, as
amended, or to qualify the Trust Agreement under the Trust Indenture Act of
1939, as amended.
11. The provisions of Section 1110 of the United States Bankruptcy
Code will apply to the Aircraft for the benefit of the Lessor, as lessor under
and by reason of the Lease. The Lease, including the rights under Section
1110 of the United States Bankruptcy Code, has been assigned to the Indenture
Trustee pursuant to the Indenture as part of the collateral for the
Certificates and, as assignee, the Indenture Trustee has the benefit of
Section 1110.
The foregoing opinions are subject to the following qualifications:
(a) We have relied, with your consent, without independent
investigation and verification and subject to the assumptions and
qualifications contained therein, upon the opinions of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President - Law of Federal Express to be
delivered to you and dated the date hereof, for purposes of the matters
covered thereby.
(b) We are qualified to practice law in the State of New York, and
we do not purport to be experts on, or to express any opinion herein
concerning, any laws other than the laws of the State of New York, the laws
of the United States and the General Corporation Law of the State of
Delaware. We express no opinion as to any matters involving aviation law.
(c) The opinion contained in paragraph 3(A) above as to
enforceability is subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity which may
affect the remedies provided in the agreements referred to in said
opinions, which laws and principles, however, do not in our opinion make
the remedies provided in said agreements inadequate for the practical
realization of the benefits of the security intended to be provided thereby.
(d) This opinion is rendered solely to you at Federal Express's
request in connection with the above matter. This opinion may not be
relied upon by you for any other purpose or relied upon by any other Person
without our prior written consent.
(e) We rendered an opinion dated August 28, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent
and agree that the addressees hereto who were not addressees to the
Delivery Date Opinion may rely on the Delivery Date Opinion as fully and
with the same force and effect as if such addressees were originally named
therein on the date of the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(2)(a)
[Letterhead of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
We have acted as special New York counsel for PMCC Leasing Corporation
("PMCC") in connection with the transactions contemplated by the Participation
Agreement (Federal Express Corporation Trust No. N667FE), dated as of August 1,
1996, as amended and restated as of October 15, 1996 (the "Participation
Agreement"), among Federal Express Corporation, as lessee, First Security Bank,
National Association, not in its individual capacity, but solely as owner
trustee, PMCC, as owner participant, State Street Bank and Trust Company, not
in its individual capacity but solely as indenture trustee, State Street Bank
and Trust Company, not in its individual capacity but solely as pass through
trustee and ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as original loan
participants. This opinion is being furnished to you pursuant to Section
4.01(l)(ii) of the Participation Agreement. Capitalized terms used herein and
not otherwise defined herein shall have the meaning ascribed to them in the
Participation Agreement.
We have examined executed counterparts of the Participation Agreement,
Amendment No. 1 to the Tax Indemnity Agreement, Trust Agreement, Ancillary
Agreement I and Ancillary Agreement II (collectively, the "Owner Participant
Documents") and we have made such other and further investigations as we have
deemed necessary or appropriate for purposes of this opinion. In our
examination we have assumed, with your permission, and without independent
investigation or inquiry, the genuineness of all signatures, the authenticity
of all documents submitted to us as originals and the conformity to original
documents of all documents submitted to us as certified or photocopies and the
authenticity of the originals of such latter documents.
With your permission, we have further assumed that (i) the Owner
Participant Documents have been duly authorized, executed and delivered by
each of the parties thereto, (ii) the respective parties thereto have the
power and authority to execute, deliver and perform the Owner Participant
Documents, (iii) the execution, delivery and performance of the Owner
Participant Documents by the parties thereto do not and will not violate the
certificate of incorporation, by-laws or other organizational documents of any
such party or any bond, debenture, note, mortgage, indenture, lease or other
agreement or instrument to which any such party is a party or by which any
such party is bound and does and will fully comply with all laws and
regulations applicable to each such party and (iv) the Owner Participant
Documents constitute valid, legal and binding obligations of the parties
thereto (other than PMCC), enforceable against such parties (other than PMCC)
in accordance with their respective terms.
Based upon the foregoing, we are of the opinion that:
1. The Participation Agreement and the Amendment No. 1 to the Tax
Indemnity Agreement constitute valid and legally binding obligations of PMCC
enforceable against PMCC in accordance with their respective terms.
2. The execution and delivery by the Owner Participant of the Owner
Participant Documents and the making of its investment thereby will not result
in any violation of any Federal or New York statute or any order, rule or
regulation issued pursuant to any New York or Federal statute by any New York
or Federal Court or governmental agency or body having jurisdiction over the
Owner Participant.
3. No consent, approval, authorization, order, registration or
qualification under any Federal or New York statute is required to be obtained
by the Owner Participant for the execution and delivery by the Owner
Participant of the Owner Participant Documents or the making of its investment
thereby.
Our opinion in paragraph 1 is subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.
We are members of the Bar of the State of New York and express no
opinion herein concerning any law other than the laws of the State of New York.
This opinion is rendered to you in connection with the above-described
transaction. This opinion may not be relied by you for any other purpose, or
relied upon by or furnished to any other person, firm or corporation without
our prior written consent, except that the Owner Participant may furnish a
copy of this opinion to a potential transferee or participant of the interest
of such entity or otherwise as required by a governmental authority.
We rendered an opinion dated August 28, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(2)(b)
[Letterhead of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Capital Corporation]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
In my capacity as Assistant General Counsel and Assistant
Secretary of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Capital Corporation, a Delaware corporation, I
have supervised corporate proceedings of its wholly owned subsidiary, PMCC
Leasing Corporation, a Delaware corporation (the "Owner Participant"), in
connection with the Owner Participant's participation in the transactions
contemplated by that certain Participation Agreement (Federal Express
Corporation Trust No. N667FE), dated as of August 1, 1996, as amended and
restated as of October 15, 1996 (the "Participation Agreement"), among the
Owner Participant; Federal Express Corporation as Lessee; the Original
Loan Participants named in the Participation Agreement; First Security
Bank, National Association, not in its individual capacity, except as
otherwise stated, but solely as owner trustee; State Street Bank and Trust
Company, not in its individual capacity, except as otherwise stated, but
solely as indenture trustee and as pass through trustee. This opinion is
delivered pursuant to Section 4.01(l)(ii) of the Participation Agreement.
Capitalized terms used herein but not otherwise defined herein shall have
the respective meanings set forth in Schedule II to the Participation
Agreement.
In connection with this opinion, I have examined originals, or copies
certified or otherwise identified to my satisfaction of the Participation
Agreement, the Ancillary Agreement I, the Ancillary Agreement II, the
Amendment No. 1 to the Tax Indemnity Agreement, and the Trust Agreement (each
such Participation Agreement, Ancillary Agreement I, Ancillary Agreement II,
Amendment No. 1 to the Tax Indemnity Agreement and Trust Agreement to be
hereafter referred to individually as an "Operative Document" and collectively
as the "Operative Documents"). I have also examined such corporate documents,
records and instruments of the Owner Participant as in my judgment are
necessary or appropriate to enable me to render the opinions expressed below.
In rendering such opinions, I have relied upon the representations and
warranties contained in or made pursuant to the Operative Documents and have
assumed the due authorization, execution and delivery of all documents and
instruments by all parties thereto other than the Owner Participant.
Based on the foregoing and subject to the qualifications and matters
of reliance set forth herein, I am of the opinion that:
1. The Owner Participant is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, has
full corporate power, authority and legal right to carry on its business as
now conducted, and is duly authorized and empowered to execute and deliver
the Operative Documents and to fulfill and comply with the terms,
conditions and other provisions thereof.
2. The Operative Documents have been duly authorized by all necessary
corporate action on the part of the Owner Participant, and have been duly
executed and delivered by the Owner Participant.
3. No filing with, notice to or authorization or approval from any
governmental or public body or authority is required under the laws of the
State of New York, the laws of the United States of America, or the General
Corporation Law of the State of Delaware in connection with the execution,
delivery and performance by the Owner Participant of the Operative
Documents.
4. There are no actions, suits or proceedings (whether or not
purportedly on behalf of the Owner Participant) pending or, to my
knowledge, threatened against or affecting the Owner Participant or any
property rights of the Owner Participant at law or in equity or before any
commission or other administrative agency which, either individually or in
the aggregate, could materially and adversely affect the condition,
financial or otherwise, of the Owner Participant or its ability to perform
its obligations under the Operative Documents or which would affect the
legality, validity or enforceability of such Operative Documents.
5. Neither the execution and delivery of the Operative Documents, the
consummation of the transactions therein contemplated nor the fulfillment
of or compliance with the terms, conditions and other provisions thereof
will conflict with, or result in any breach of, any of the terms,
conditions or provisions of (i) any law or regulation binding upon the
Owner Participant, (ii) any order, injunction or decree of any court or
governmental instrumentality binding upon the Owner Participant, (iii) the
Certificate of Incorporation or Bylaws of the Owner Participant, or (iv) to
my knowledge, any bond, debenture, note, mortgage, indenture or other
agreement or instrument to which the Owner Participant is now a party or by
which the property of the Owner Participant may be bound.
I am a member of the bar of the State of New York, and I do not
purport to be conversant with, or to express any opinion herein concerning,
the laws of any jurisdiction other than those of the State of New York and the
United States of America and the General Corporation Law of the State of
Delaware. In addition, I express no opinion concerning the laws of the State
of New York, the United States of America or any other jurisdiction applicable
to the offering or sale of securities. Further, I have made no investigation
and express no opinion, as to any aviation law or other laws, statutes, rules
or regulations applicable due to the particular nature of the equipment
subject to the Lease.
This opinion is solely for the benefit of the addresses hereof and
their respective successors and assigns for use in connection with the
transactions contemplated by the Operative Documents and may not be relied
upon by any other person or for any other purpose without my express written
consent. This opinion may be relied upon by Messrs. Simpson, Thacher &
▇▇▇▇▇▇▇▇ in rendering their opinion of even date herewith.
I rendered an opinion dated August 28, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. I hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully, and with the same
force and effect as if such addressees were originally named therein on the
date of the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇ ▇. Rights
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(3)
[Letterhead of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇]
[Refunding Date]
To the Parties Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company, a Massachusetts trust company, individually ("State Street"), and as
Indenture Trustee (the "Indenture Trustee") under the Trust Indenture and
Security Agreement (Federal Express Corporation Trust No. N667FE), dated as of
August 1, 1996, as amended and restated as of October 15, 1996 (the
"Indenture") between First Security Bank, National Association, not in its
individual capacity but solely as Owner Trustee (the "Owner Trustee") and the
Indenture Trustee, in connection with the transactions contemplated by that
certain Participation Agreement (Federal Express Corporation Trust No.
N667FE), dated as of August 1, 1996, as amended and restated as of October 15,
1996 (the "Participation Agreement"), among Federal Express Corporation, as
Lessee (the "Lessee"); PMCC Leasing Corporation, as Owner Participant (the
"Owner Participant"); ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of
America National Trust & Savings Association, The Chase Manhattan Bank,
Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South), as Loan
Participants (the "Original Loan Participants"); the Owner Trustee; and the
Indenture Trustee. This opinion is being delivered pursuant to Section
4.01(l)(iii) of the Participation Agreement. Except as otherwise defined
herein, all capitalized terms used herein shall have the respective meanings
set forth in Schedule II to the Participation Agreement.
Our representation of State Street has been as special counsel for the
purposes stated above. As to all matters of fact (including factual
conclusions and characterizations and descriptions of purpose, intention or
other state of mind), we have relied entirely upon (i) the representations of
the parties set forth in the Operative Agreements and (ii) the certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations and certificates.
We have examined each Operative Agreement to which State Street or the
Indenture Trustee, as the case may be, is a party (collectively, the
"Indenture Trustee Documents"), the Certificate of the Massachusetts
Commissioner of Banks relating to State Street and originals, or copies
certified or otherwise identified to our satisfaction, of such other
documents, corporate records, certificates, or other instruments as we have
deemed necessary or advisable for the purposes of this opinion.
We have assumed the genuineness of all signatures (other than those on
behalf of State Street and the Indenture Trustee), the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form
and the legal competence of each individual executing any document (other than
on behalf of State Street and the Indenture Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we are
aware or which are known to us, or with another similar qualification, the
relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion, the
individual lawyers in the firm who have participated directly in the specific
transactions to which this opinion relates or in the preparation of this
opinion and the partner of the firm responsible for State Street corporate
trust matters, and without any special or additional investigation undertaken
for the purposes of this opinion.
Each opinion set forth below relating to the enforceability of any
agreement or instrument against State Street and the Indenture Trustee, as
applicable, is subject to the following general qualifications:
(i) as to any Indenture Trustee Document, we assume that such agreement is
the legal, valid and binding obligation of each other party thereto;
(ii) the enforceability of any obligation of State Street and the
Indenture Trustee may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, marshalling or other similar laws and
rules of law affecting the enforcement of rights and remedies (including such
as may deny giving effect to waivers of debtors' or guarantors' rights) of
creditors generally; and
(iii) the enforcement of any rights and availability of any specific or
equitable relief may in all cases by subject to an implied duty of good faith
and to general principals of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
Subject to the limitations set forth herein, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions expressed herein are limited solely to the internal
substantive laws of the Commonwealth of Massachusetts and the Federal laws of
the United States of America. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
other than our opinion expressed in Paragraph 1 hereof with respect to the
citizenship of State Street, no opinion is expressed as to matters governed by
the Transportation Code or by any other law, statute, rule or regulation of
the United States relating to the acquisition, ownership, registration, use,
operation, maintenance, repair, replacement or sale of or the nature of the
Aircraft, Airframe or the Engines.
With your permission and without investigation, with respect to
paragraph 4 below in connection with our opinion relating to the legality,
validity, binding effect and enforceability of the documents there referred
to, to the extent that the laws of the Commonwealth of Massachusetts do not
govern such documents, we have assumed that the laws of the jurisdiction whose
laws govern such documents are not materially different from the internal
substantive laws of the Commonwealth of Massachusetts.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their respective successors and assigns in
connection with the transactions contemplated by the Operative Agreements and
may not be used or relied upon by any other person or for any other purpose.
Based upon the foregoing, we are of the opinion that:
1. State Street is a Massachusetts trust company, duly organized
and validly existing in good standing with the Massachusetts Commissioner of
Banks under the laws of the Commonwealth of Massachusetts, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has the full corporate power and authority to
execute, deliver and perform its obligations under the Indenture Trustee
Documents and, in its capacity as Indenture Trustee, to authenticate the
Certificates delivered on the Refunding Date and to perform its other
obligations under the Indenture Trustee Documents.
2. The execution and delivery of the Indenture Trustee Documents by
State Street, in its individual capacity or as Indenture Trustee, as the case
may be, and compliance by State Street or the Indenture Trustee, as the case
may be, individually or as Indenture Trustee, as the case may be, with all of
the provisions thereof do not and will not contravene any Massachusetts or
Federal law, rule or regulation governing the banking or trust powers of State
Street or the Indenture Trustee, or any order or judgment known to us, of any
Massachusetts or Federal court or governmental authority applicable to or
binding on State Street, individually or as Indenture Trustee, or contravene
the provisions of, or constitute a default under, or result in the creation
of a Lien on any property of State Street or the Indenture Trustee under, its
charter documents or By-Laws or any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit agreement, in
each case known to us, or any other agreement or instrument, in each case
known to us, to which State Street, individually or as Indenture Trustee, is a
party or by which it or any of its property may be bound or affected, other
than the Lien of the Indenture.
3. No order, license, consent, permit, authorization or approval
of or exemption by, and no notice to or filing with, or the taking of any
other action in respect of, any Massachusetts or Federal governmental
authority governing the banking or trust powers of State Street or the
Indenture Trustee, and no filing, recording, publication or registration in
any public office is required under Massachusetts or Federal law pertaining to
its banking or trust powers for the due execution, delivery or performance by
State Street, individually or as Indenture Trustee, as the case may be, of the
Indenture Trustee Documents and of the certificate of authentication, as
Indenture Trustee, on the Certificates, or for the legality, validity, binding
effect or enforceability thereof against State Street or the Indenture
Trustee, as the case may be.
4. Each of the Indenture Trustee Documents has been duly
authorized, executed and delivered by State Street, in its individual capacity
or as Indenture Trustee, as the case may be, and each such document
constitutes a legal, valid and binding obligation of State Street, in its
individual capacity or as Indenture Trustee, as the case may be, enforceable
against State Street, in its individual capacity or as Indenture Trustee, as
the case may be, in accordance with its terms.
5. The Certificates issued and dated the Refunding Date have been
duly authenticated and delivered by the Indenture Trustee pursuant to the
terms of the Indenture.
6. There are no fees, taxes or other governmental charges payable
by the Owner Trustee, the Indenture Trustee (except taxes imposed on fees
payable to the Indenture Trustee in its individual capacity) or the
Certificate Holders under the laws of the Commonwealth of Massachusetts or any
political subdivision thereof in connection with the execution, delivery or
performance of any of the Operative Agreements or in connection with the
issuance and acquisition of the Certificates by the Certificate Holders or the
beneficial interest of the Certificate Holders in the Trust Indenture Estate
solely because the Indenture Trustee in its individual capacity (a) is
incorporated under the laws of the Commonwealth of Massachusetts, (b) has its
principal place of business in the Commonwealth of Massachusetts, (c) performs
(in its individual capacity or as Indenture Trustee) any or all of its duties
under the Indenture Trustee Documents in the Commonwealth of Massachusetts,
and (d) engages in any activities unrelated to the transactions contemplated
by the Indenture Trustee Documents in the Commonwealth of Massachusetts.
Neither the Indenture Trustee nor the trust created under the Indenture will
be subject to any fee, tax or other governmental charge (except for taxes
imposed on fees payable to the Indenture Trustee in its individual capacity)
under the laws of the Commonwealth of Massachusetts or any political
subdivision thereof in existence on the date hereof, on, based on or measured
by, directly or indirectly, the gross receipts, net income or value of the
Trust Indenture Estate solely because the Indenture Trustee in its individual
capacity (a) is incorporated under the laws of the Commonwealth of
Massachusetts, (b) has its principal place of business in the Commonwealth of
Massachusetts, (c) performs (in its individual capacity or as Indenture
Trustee) any or all of its duties under the Indenture Trustee Documents in the
Commonwealth of Massachusetts, and (d) engages in any activities unrelated to
the transactions contemplated by the Indenture Trustee Documents in the
Commonwealth of Massachusetts. There is no fee, tax or other governmental
charge (except for taxes imposed on fees payable to the Indenture Trustee in
its individual capacity) under the laws of the Commonwealth of Massachusetts
or any political subdivision thereof in existence on the date hereof, on,
based on or measured by any payments under the Certificates by reason of the
creation of the trust under the Indenture solely because the Indenture Trustee
in its individual capacity (a) is incorporated under the laws of the
Commonwealth of Massachusetts, (b) has its principal place of business in the
Commonwealth of Massachusetts, (c) performs (in its individual capacity or as
Indenture Trustee) any or all of its duties under the Indenture Trustee
Documents in the Commonwealth of Massachusetts, and (d) engages in any
activities unrelated to the transactions contemplated by the Indenture Trustee
Documents in the Commonwealth of Massachusetts. We express no opinion as to
whether or not any fees, taxes or other charges are now or hereafter may be
payable by the Original Loan Participants or the Owner Participant to the
Commonwealth of Massachusetts or any political subdivision thereof in
connection with (a) the execution, delivery, or performance by any of the
Indenture, the Participation Agreement or any of the other Operative
Agreements and (b) the making by the Owner Participant of its investment in
the Aircraft.
7. To the best of our knowledge, there are no pending or threatened
actions or proceedings against State Street before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of State Street, individually or
as Indenture Trustee, to perform its obligations under the Indenture Trustee
Documents.
We rendered an opinion dated August 28, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(4)
[Letterhead of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇]
[Refunding Date]
To the Parties Named on Schedule A attached hereto
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 4.01(l)(iv) of
the Participation Agreement (Federal Express Corporation Trust No. N667FE),
dated as of August 1, 1996, as amended and restated as of October 15, 1996
(the "Participation Agreement") among Federal Express Corporation, as lessee
(the "Lessee"), PMCC Leasing Corporation, as owner participant (the "Owner
Participant"), ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as original loan
participants (the "Original Loan Participants"), First Security Bank, National
Association, as owner trustee (the "Owner Trustee"), State Street Bank and
Trust Company, as indenture trustee (the "Indenture Trustee"), and State Street
Bank and Trust Company, as pass through trustee (the "Pass Through Trustee"),
which Participation Agreement amends and restates that certain Participation
Agreement (Federal Express Corporation Trust No. N667FE), dated as of August 1,
1996 (the "Original Participation Agreement") among the Lessee, the Owner
Participant, the Original Loan Participants, the Owner Trustee and the
Indenture Trustee, with respect to that portion of Subtitle VII of Title 49 of
the United States Code relative to the recordation of instruments and the
registration of aircraft thereunder.
The capitalized terms herein shall, unless otherwise defined, have
the same meanings given them in the Participation Agreement or in Annex I
attached hereto.
We have examined and filed on this date with the Federal Aviation
Administration (the "FAA") the following described instruments at the
respective times listed below:
(a) Trust Agreement (Federal Express Corporation Trust No. N667FE)
dated as of August 1, 1996, as amended and restated as of
October 15, 1996 (the "Trust Agreement") between the Owner
Participant and the Owner Trustee, which Trust Agreement amends
and restates the Original Trust Agreement, which Trust
Agreement was filed at ____ _.m., C._.T.;
(b) Trust Indenture and Security Agreement (Federal Express
Corporation Trust No. N667FE) dated as of August 1, 1996, as
amended and restated as of October 15, 1996 (the "Indenture")
between the Owner Trustee and the Indenture Trustee, which
Indenture amends and restates the Original Indenture, which
Indenture was filed at ____ _.m., C._.T.; and,
(c) Lease Agreement (Federal Express Corporation Trust No. N667FE)
dated as of August 1, 1996, as amended and restated as of
October 15, 1996 (the "Lease") between the Owner Trustee, as
lessor, and the Lessee, as lessee, which Lease amends and
restates the Original Lease, with the Indenture attached
thereto, which Lease with the Indenture attached was filed at
____ _.m., C._.T.
The Confidential Omissions were intentionally omitted from the FAA
filing counterparts of the Lease and the Indenture as containing confidential
financial information.
Based upon our examination of the above described instruments and of
such records of the FAA as we deemed necessary to render this opinion, it is
our opinion that:
1. AC Form 8050-2 Aircraft ▇▇▇▇ of Sale dated August 28, 1996 (the "FAA
▇▇▇▇ of Sale") from AVSA S.A.R.L., as seller, conveying title to the
Airframe to the Owner Trustee has been duly recorded by the FAA on
August 28, 1996 and assigned Conveyance No. 2A269961;
2. the Indenture and the Lease with the Indenture attached are in due
form for recordation by and have been duly filed for recordation with
the FAA pursuant to and in accordance with the provisions of 49
U.S.C. Section 44107;
3. the Trust Agreement is in due form for filing and has been duly filed
with the FAA pursuant to and in accordance with the provisions of 49
U.S.C. Section 44103(a);
4. the Original Trust Agreement was duly filed with the FAA on August 28,
1996 pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44103(a);
5. the Original Indenture with the Indenture and Security Agreement
Supplement attached has been duly filed with and duly recorded by the
FAA pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44107;
6. the Original Lease with the Lease Supplement, the Original Indenture
and the Indenture and Security Agreement Supplement attached was duly
filed with and duly recorded by the FAA pursuant to and in accordance
with the provisions of 49 U.S.C. Section 44107;
7. the Airframe is duly registered in the name of the Owner Trustee
pursuant to and in accordance with the provisions of 49 U.S.C.
Section 44103(a);
8. the Owner Trustee has valid legal title to the Airframe and the
Aircraft is free and clear of all Liens, except (i) the security
interest created by the Original Indenture, as amended and restated
by the Indenture, as supplemented by the Indenture and Security
Agreement Supplement, and (ii) the rights of the parties under the
Original Lease, as amended and restated by the Lease, as supplemented
by the Lease Supplement;
9. the Original Indenture, as amended and restated by the Indenture, as
supplemented by the Indenture and Security Agreement Supplement,
constitutes a duly perfected first priority security interest in the
Aircraft and a duly perfected first assignment of all the right,
title and interest of the Owner Trustee in, to and under the Original
Lease, as amended and restated by the Lease, as supplemented by the
Lease Supplement (insofar as such assignment affects an interest
covered by the recording system established by the FAA pursuant to 49
U.S.C. Section 44107), and no other registration of the Airframe or
filings other than filings with the FAA (which have been duly
effected) are necessary in order to perfect in any applicable
jurisdiction in the United States (A) the Owner Trustee's title to
the Airframe or (B) such security interest and assignment (insofar as
such assignment affects an interest covered by the recording system
established by the FAA pursuant to 49 U.S.C. Section 44107), it being
understood that no opinion is herein expressed as to the validity,
priority or enforceability of such security interest and assignment
under local law or as to the recognition of the perfection of such
security interest and assignment as against third parties in any
legal proceeding outside the United States;
10. no authorization, approval, consent, license or order of, or
registration with, or the giving of notice to, the FAA is required
for the valid authorization, delivery and performance of the Original
Lease, as amended and restated by the Lease, as supplemented by the
Lease Supplement, the Original Indenture, as amended and restated by
the Indenture, as supplemented by the Indenture and Security
Agreement Supplement, or the Original Trust Agreement, as amended and
restated by the Trust Agreement, except for such filings as are
referred to in our opinion dated August 28, 1996 (which have been
duly effected) and the filings referred to in clauses (a), (b) and (c)
above; and,
11. neither the authorization, issuance and delivery of the Certificates,
the execution and delivery by the parties thereto of the Original
Trust Agreement, the Trust Agreement, the Original Indenture, the
Indenture, the Indenture and Security Agreement Supplement, the
Original Participation Agreement, the Participation Agreement, the
FAA ▇▇▇▇ of Sale, the Original Lease, the Lease and the Lease
Supplement or the performance by the parties thereto of: (i) the
Original Trust Agreement, as amended and restated by the Trust
Agreement; (ii) the Original Indenture, as amended and restated by
the Indenture, as supplemented by the Indenture and Security Agreement
Supplement; (iii) the Original Participation Agreement, as amended and
restated by the Participation Agreement; and (iv) the Original Lease,
as amended and restated by the Lease, as supplemented by the Lease
Supplement, in accordance with the provisions thereof, nor the
consummation by the parties thereto of any of the transactions
contemplated thereby, requires the consent or approval of, or the
giving of notice to, or the registration with, or the taking of any
other action in respect of, the FAA except for the filings, the
recordations and the filings for recordations specified elsewhere in
this opinion.
No opinion is expressed as to the Airframe during any period or
periods of time during which it has not been subject to United States
registration.
No opinion is expressed as to laws other than Federal laws of the
United States. In rendering this opinion, we were subject to the accuracy of
the FAA, its employees and agents, in the filing, indexing and recording of
instruments filed with the FAA and in the search for encumbrance
cross-reference index cards for the Engines. Further, in rendering this
opinion we are assuming the validity and enforceability of the above described
instruments under local law. Since our examination was limited to records
maintained by the FAA, our opinion does not cover liens which are perfected
without the filing of notice thereof with the FAA, such as federal tax liens,
liens arising under 29 U.S.C. Section 1368(a), possessory artisan's liens, or
matters of which the parties have actual notice. In rendering this opinion we
are assuming that there are no documents with respect to the Aircraft which
have been filed for recording under the recording system of the FAA but have
not yet been listed in the available records of such system as having been so
filed.
In rendering this opinion we have relied upon the opinion of the
Assistant Chief Counsel of the Aeronautical Center dated October ___, 1996 and
have continued to rely upon the opinion of the Assistant Chief Counsel of the
Aeronautical Center dated August 28, 1996, copies of which are attached
hereto.
Very truly yours,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
For the Firm
Annex I
Certain Definitions
Airframe, Engines and Aircraft
One (1) Airbus Industrie A300F4-605R aircraft bearing manufacturer's
serial number 771 and U.S. Registration No. N667FE (the "Airframe") and two
(2) General Electric CF6-80C2-A5F aircraft engines bearing manufacturer's
serial numbers 705-244 and 705-245 (the "Engines") (the Airframe and the
Engines are referred to collectively as the "Aircraft").
Original Trust Agreement
Trust Agreement (Federal Express Corporation Trust No. N667FE) dated
as of August 1, 1996 between PMCC Leasing Corporation, as owner participant,
and First Security Bank, National Association, as owner trustee, which was
filed with the FAA on August 28, 1996.
Original Indenture
Trust Indenture, Mortgage and Security Agreement (Federal Express
Corporation Trust No. N667FE) dated as of August 1, 1996 between First Security
Bank, National Association, as owner trustee, and State Street Bank and Trust
Company, as indenture trustee, which together with the Indenture and Security
Agreement Supplement (as hereinafter defined) attached thereto was recorded as
one instrument by the FAA on August 29, 1996 and assigned Conveyance No.
2A269964.
Indenture and Security Agreement Supplement
Indenture and Security Agreement Supplement No. 1 (Federal Express
Corporation Trust No. N667FE) dated August 28, 1996 between First Security
Bank, National Association, as owner trustee, and State Street Bank and Trust
Company, as indenture trustee, with respect to the Aircraft, which was
attached to and recorded by the FAA as one instrument with the Original
Indenture.
Original Lease
Lease Agreement (Federal Express Corporation Trust No. N667FE) dated
as of August 1, 1996 between First Security Bank, National Association, as
owner trustee, as lessor, and Federal Express Corporation, as lessee, which
together with the Lease Supplement (as hereinafter defined), the Original
Indenture and the Indenture and Security Agreement Supplement attached thereto
was recorded as one instrument by the FAA on August 29, 1996 and assigned
Conveyance No. 2A269965.
Lease Supplement
Lease Supplement ▇▇. ▇ (▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇)
dated August 28, 1996 between First Security Bank, National Association, as
owner trustee, as lessor, and Federal Express Corporation, as lessee, with
respect to the Aircraft, which was attached to and recorded by the FAA as one
instrument with the Original Lease.
Confidential Omissions
The Lease was filed with the FAA, with (i) Basic Rent (Schedule II),
(ii) the Stipulated Loss Values (Schedule III), (iii) the Termination Values
(Schedule IV), (iv) the Additional Purchase Option Schedule (Schedule V)
omitted from the FAA filing counterpart thereof as containing confidential
financial information; and (v) the purchase price under Section 4.02(a)(F) of
the Lease set forth in Ancillary Agreement II, which was not attached to the
FAA filing counterpart of the Lease or otherwise filed with the FAA for
recordation.
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(5)
[Letterhead of Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇]
[Refunding Date]
To Each of the Persons Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
We have acted as special counsel to First Security Bank, National
Association, a national banking association ("First Security"), in connection
with the Trust Agreement (Federal Express Corporation Trust No. N667FE), dated
as of August 1, 1996, as amended and restated as of October 15, 1996 (the
"Trust Agreement"), between First Security and PMCC Leasing Corporation, a
Delaware corporation (the "Owner Participant"). Pursuant to the Participation
Agreement (Federal Express Corporation Trust No. N667FE), dated as of August
1, 1996, as amended and restated as of October 15, 1996 (the "Participation
Agreement"), among Federal Express Corporation, as Lessee, the Owner
Participant, ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants, First Security, not in its individual capacity except as
otherwise expressly set forth therein but solely as Owner Trustee (the "Owner
Trustee") under the Trust Agreement, State Street Bank and Trust Company, as
Indenture Trustee and State Street Bank and Trust Company, as Pass Through
Trustee, one Airbus A300F4-605R aircraft bearing U.S. Registration No. N667FE
(the "Aircraft") is being refinanced. This opinion is furnished pursuant to
Section 4.01(l)(vii) of the Participation Agreement. Capitalized terms used
herein and not otherwise defined are used as defined in the Participation
Agreement, except that references herein to any instrument shall mean such
instrument as in effect on the date hereof.
We have examined executed counterparts or copies otherwise identified
to our satisfaction of the following documents:
(a) The Participation Agreement;
(b) The Trust Agreement;
(c) The Indenture;
(d) The Indenture and Security Agreement Supplement No. 1 dated
August 28, 1996;
(e) The Lease;
(f) The Ancillary Agreement I;
(g) The Ancillary Agreement II:
(h) The Lease Supplement dated August 28, 1996 (each of the
documents identified in paragraphs (a) through (h) being
collectively referred to as the "Owner Trustee Documents"); and
(h) The Certificates being issued today (the "Certificates").
We have also examined originals or copies of such other documents,
such corporate records, certificates and other statements of governmental
officials and corporate officers and other representatives of the corporations
or entities referred to herein and such other instruments as we have deemed
necessary or appropriate for the purposes of this opinion. Moreover, as to
certain facts material to the opinions expressed herein, we have relied upon
representations and warranties contained in the Owner Trustee Documents.
Based upon the foregoing and upon an examination of such questions of
law as we have considered necessary or appropriate, and subject to the
assumptions, exceptions and qualifications set forth below, we advise you
that, in our opinion:
1. First Security is a national banking association duly organized
and validly existing under the laws of the United States of America holding
a valid certificate to do business as a national banking association, with
banking and trust powers, is a Citizen of the United States within the
meaning of Section 40102(a)(15) of the Transportation Code, and each of
First Security and the Owner Trustee, as the case may be, has or had, on
the date of execution thereof, full corporate power, authority and legal
right to execute, deliver and perform each of the Owner Trustee Documents
to which it is or is to be a party and to issue, execute, deliver and
perform the Certificates.
2. Each of First Security and the Owner Trustee, as the case may be,
has duly authorized, executed and delivered each Owner Trustee Document to
which it is a party; each such document constitutes a legal, valid and
binding obligation of the Owner Trustee (and, to the extent set forth in
the respective Owner Trustee Document, of First Security) enforceable
against the Owner Trustee (and, to the extent set forth in the respective
Owner Trustee Document, against First Security) in accordance with its
terms; and assuming the Trust Agreement was properly authorized, executed
and delivered by the Owner Participant and that the terms of the Trust
Agreement are not in violation of any laws, documents, judgments,
regulations or other provisions applicable to the Owner Participant, the
Trust Agreement constitutes, under the laws of the State of Utah, a legal,
valid and binding obligation of the Owner Participant enforceable against
the Owner Participant in accordance with its terms. The Certificates have
been duly issued, executed and delivered by the Owner Trustee, pursuant to
authorization contained in the Trust Agreement, and constitute the legal,
valid and binding obligations of the Owner Trustee enforceable against the
Owner Trustee in accordance with their terms and the terms of the
Indenture; and the Certificates are entitled to the benefits and security
afforded by the Indenture in accordance with their terms and the terms of
the Indenture.
3. On the Delivery Date, the Owner Trustee received from AVSA such
title to the Aircraft as AVSA conveyed to the Owner Trustee, subject to the
rights of the Owner Trustee and the Lessee under the Original Lease and the
security interest created pursuant to the Original Indenture and the
Indenture Supplement; and to our knowledge, there exist no Liens affecting
the title of the Owner Trustee to the Lessor's Estate resulting from claims
against First Security not related to the ownership of the Lessor's Estate
or the administration of the Lessor's Estate or any other transaction
pursuant to the Indenture or any document included in the Trust Indenture
Estate.
4. Under the laws of the State of Utah, all of the properties which
are part of the Trust Indenture Estate have been pledged and mortgaged with
the Indenture Trustee as part of the Trust Indenture Estate and the
beneficial interest of the Owner Participant under the Trust Agreement in
and to such properties is subject, to the extent provided in the Indenture,
to the Lien of the Indenture in favor of the holders of the Certificates
issued and to be issued under the Indenture.
5. To the extent that the Uniform Commercial Code of the State of
Utah (the "UCC") is applicable, except for the Indenture Trustee's taking
possession of all monies and securities (including instruments)
constituting part of the Trust Indenture Estate, no action, including the
filing or recording of any document, is necessary (i) to create under the
UCC the security interest in the Trust Indenture Estate (including the
grant and assignment unto the Indenture Trustee of the security interest in
all estate, right, title and interest of the Owner Trustee in, to and under
the Lease, the Lease Supplement and the Participation Agreement), which
the Indenture by its terms purports to create in favor of the Indenture
Trustee, and (ii) to perfect in the State of Utah such security
interest, except for the filing of a UCC financing statement complying
with the formal requisites of Section 9-402 of the UCC in the office of
the Division of Corporations and Commercial Code of the State of Utah
with respect to the security interest, which filing has been duly
effected, and the filing of continuation statements with respect thereto
required to be filed at periodic intervals under the UCC.
6. The Trust Agreement duly creates a legal and valid trust under
Utah law, the trust created by the Trust Agreement has been duly created
and exists for the benefit of the Owner Participant, and the Trust
Agreement creates for the benefit of the Owner Participant the interest in
the properties referred to in Section 1.02 of the Trust Agreement which the
Trust Agreement by its terms purports to create, which interest is subject
and subordinate to the security interests created by the Indenture to the
extent provided in the Indenture.
7. Neither the authorization, execution and delivery by the Owner
Trustee or First Security, as the case may be, of the Owner Trustee
Documents, nor the issuance, execution and delivery by the Owner Trustee of
the Certificates nor the fulfillment or compliance by the Owner Trustee or
First Security with the respective terms and provisions thereof nor the
consummation of any of the transactions by the Owner Trustee or First
Security, as the case may be, contemplated thereby requires the consent or
approval of, the giving of notice to, the registration with, or the taking
of any other action in respect of, any court or administrative or
governmental authority or agency of the State of Utah or the United States
of America governing the banking or trust powers of First Security.
8. Assuming that (i) the Aircraft is not used in Utah and is not
physically located in Utah at the commencement or termination of the Term
or during such Term, (ii) in connection with any sale of the Aircraft, such
Aircraft will not be physically delivered in Utah to a buyer nor be shipped
from a point within Utah to a buyer, and (iii) the trust created by the
Trust Agreement is treated as a grantor trust for federal income tax
purposes within the contemplation of Sections 671 through 678 of the
Internal Revenue Code of 1986, there are no fees, taxes, or other charges
(except taxes imposed on fees payable to the Owner Trustee) payable to the
State of Utah or any political subdivision thereof in connection with the
execution, delivery or performance by the Owner Trustee, the Indenture
Trustee, the Lessee or the Owner Participant, as the case may be, of the
Owner Trustee Documents or in connection with the making by the Owner
Participant of its investment in the Aircraft or its acquisition of the
beneficial interest in the Lessor's Estate or in connection with the
issuance and acquisition of the Certificates, and neither the Owner
Trustee, the Lessor's Estate nor the trust created by the Trust Agreement
will be subject to any fee, tax or other governmental charge (except taxes
on fees payable to the Owner Trustee) under the laws of the State of Utah
or any political subdivision thereof on, based on or measured by, directly
or indirectly, the gross receipts, net income or value of the Lessor's
Estate solely by reason of the creation or continued existence of the trust
under the terms of the Trust Agreement pursuant to the laws of the State of
Utah or the Owner Trustee's performance of its duties under the Trust
Agreement.
9. The execution, delivery and performance by the Owner Trustee or
First Security, as the case may be, of each of the Owner Trustee Documents
and the issuance, execution, delivery and performance of the Certificates
by the Owner Trustee are not or were not, on the date of execution thereof,
in violation of the charter or by-laws of First Security or of any law,
governmental rule, or regulation of the State of Utah or the United States
of America governing the banking or trust powers of First Security or, to
our knowledge, of any indenture, mortgage, bank credit agreement, note or
bond purchase agreement, long-term lease, license or other agreement or
instrument to which it is a party or by which it is bound or, to our
knowledge, of any judgment or order of the State of Utah or the United
States of America relating to the banking or trust powers of First Security.
10. There is no fee, tax or other governmental charge under the laws
of the State of Utah or any political subdivision thereof in existence on
the date hereof on, based on or measured by any payments under the
Certificates or the beneficial interests in the Lessor's Estate, by reason
of the creation of the trust under the Trust Agreement, pursuant to the
laws of the State of Utah or the Owner Trustee's performance of its duties
under the Trust Agreement, within the State of Utah, which would not have
been imposed if First Security did not have its principal place of business
and did not perform its obligations under the Owner Trustee Documents in
the State of Utah.
11. Neither a Utah court nor a federal court applying federal law or
Utah law, if properly presented with the issue and after having properly
considered such issue, would permit the Owner Participant to terminate the
Trust Agreement, except in accordance with its terms or with the consent of
the Indenture Trustee, as long as the Lien of the Indenture on the Trust
Estate has not been released or payment of the principal of, and Make-Whole
Premium, if any, and interest on, the Certificates have not been made in
full.
12. Although there is no Utah case directly on point, under the
laws of the State of Utah, so long as the Trust Agreement has not been
terminated in accordance with its terms or with the consent of the
Indenture Trustee, creditors of any person that is an Owner Participant,
holders of a lien against the assets of any such person, such as
trustees, receivers or liquidators (whether or not any insolvency
proceeding has been commenced) (collectively, the "Creditors") may
acquire valid claims and liens, as to the Trust Estate, only against the
rights of such Owner Participant under the Trust Agreement or in the
Trust Estate, and do not have, and may not through the enforcement of
such Creditor's rights acquire, any greater rights than such Owner
Participant with respect to the Trust Agreement or the Trust Estate.
13. There are no actions, suits, investigations or proceedings
pending or, to our knowledge, threatened against or affecting First
Security or the Owner Trustee, as the case may be, or any of its properties
in any court or before any administrative agency or arbitrator, which, if
adversely determined, would materially adversely affect the ability of
First Security or the Owner Trustee, as the case may be, to perform its
obligations under any of the Owner Trustee Documents, and there are no
pending or, to our knowledge, threatened actions or proceedings before any
court, administrative agency or tribunal involving First Security or the
Owner Trustee, as the case may be, in connection with the transactions
contemplated by any of the Owner Trustee Documents.
The foregoing opinions are subject to the following assumptions,
exceptions and qualifications:
A. The foregoing opinions are limited to the laws of the State of
Utah and the federal laws of the United States of America governing the
banking and trust powers of First Security and Title II of the United States
Code entitled "Bankruptcy". In addition, we express no opinion with respect
to (i) federal securities laws, including the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, and the Trust
Indenture Act of 1939, as amended, (ii) the Federal Aviation Act of 1958, as
amended (except with respect to the opinion set forth in paragraph 1 above
concerning the citizenship of First Security) and (iii) state securities or
blue sky laws. Insofar as the foregoing opinions relate to the validity
and enforceability in the State of Utah of the Certificates and the other
Owner Trustee Documents expressed to be governed by the laws of the State
of New York, we have assumed that the laws of New York are identical to the
laws of Utah in all material respects, and that the Certificates and such
other Owner Trustee Documents constitute legal, valid, binding and
enforceable documents or instruments under such laws (as to which we
express no opinion). No opinion is expressed as to the priority of any
security interest or as to title to any part of the Trust Estate.
B. The foregoing opinions regarding enforceability of any document or
instrument, except for the opinions set forth in paragraphs 11 and 12 above,
are subject to (i) applicable bankruptcy, insolvency, moratorium,
reorganization, receivership and similar laws affecting the rights and
remedies of creditors generally, and (ii) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
C. We have assumed the due authorization, execution and delivery by
each of the parties thereto, other than First Security and the Owner Trustee,
of the Owner Trustee Documents to which each is a party and that each of such
parties has the full power, authority and legal right to execute and deliver
each such document.
D. The opinion set forth in paragraph 1 above concerning the
citizenship of First Security is based upon the facts contained in an
affidavit of First Security, made by its Vice President, the facts set forth
in which we have not independently verified.
E. We have assumed the due authentication of the Certificates by the
Indenture Trustee.
F. We have assumed that all signatures (other than those of the Owner
Trustee or First Security) on documents and instruments examined by us are
genuine, that all documents and instruments submitted to us as originals are
authentic, and that all documents and instruments submitted to us as copies
conform with the originals, which facts we have not independently verified.
G. We do not purport to be experts in respect of, or express any
opinion concerning, aviation law or other laws, rules or regulations
applicable to the particular nature of the equipment acquired by the Owner
Trustee.
H. We have made no investigation of, and we express no opinion
concerning, the nature of the title to any part of the Lessor's Estate or the
priority of any mortgage or security interest.
I. We have assumed that the Participation Agreement and the
transactions contemplated thereby are not within the prohibitions of Section
406 of the Employee Retirement Income Security Act of 1974.
This opinion is rendered solely for your benefit and may not be
relied upon by any other person or entity for any purpose without our prior
written consent, except that the law firm of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ may rely on
this opinion in connection with the rendering of its opinion dated the date
hereof in connection with the financing described herein.
We rendered an opinion dated August 28, 1996 (the "Delivery Date
Opinion"), a copy of which is attached hereto, in connection with the
financing and acquisition of the Aircraft on such date. We hereby consent and
agree that the addressees hereto who were not addressees to the Delivery Date
Opinion may rely on the Delivery Date Opinion as fully and with the same force
and effect as if such addressees were originally named therein on the date of
the Delivery Date Opinion.
Very truly yours,
Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT A(6)
[Letterhead of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇]
[Refunding Date]
To the Parties Listed on Schedule A Hereto
Re: Federal Express Corporation Trust No. N667FE
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company, a Massachusetts trust company, individually ("State Street"), and as
Pass Through Trustee (the "Pass Through Trustee") with respect to the Pass
Through Trust Agreement dated as of June 1, 1996 (the "Pass Through Trust
Agreement"), as supplemented by the Series Supplements dated the date hereof
between Federal Express Corporation and the Pass Through Trustee, designated
as Series Supplement 1996-B1 and 1996-B2, respectively (the "Series
Supplements") and in connection with the transactions contemplated by that
certain Participation Agreement (Federal Express Corporation Trust No.
N667FE), dated as of August 1, 1996, as amended and restated as of October 15,
1996 (the "Participation Agreement") among Federal Express Corporation, as
Lessee (the "Lessee"); PMCC Leasing Corporation, as Owner Participant (the
"Owner Participant"); ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of
America National Trust & Savings Association, The Chase Manhattan Bank,
Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants; First Security Bank, National Association, a national banking
association, not in its individual capacity but solely as Owner Trustee under
the Trust Agreement; State Street, not in its individual capacity but solely
as Indenture Trustee under the Indenture; and State Street, not in its
individual capacity, except as otherwise stated therein, but solely as Pass
Through Trustee. This opinion is being delivered pursuant to Section
4.01(l)(ix) of the Participation Agreement. Except as otherwise defined
herein, all capitalized terms used herein shall have the respective meanings
set forth in Schedule II to the Participation Agreement.
Our representation of State Street has been as special counsel for the
purposes stated above. As to all matters of fact (including factual
conclusions and characterizations and descriptions of purpose, intention or
other state of mind), we have relied entirely upon (i) the representations of
the parties set forth in the Operative Agreements and (ii) the certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations and certificates.
We have examined each Operative Agreement to which State Street or the
Pass Through Trustee, as the case may be, is a party, the Pass Through Trust
Agreement and the Series Supplements (collectively, the "Pass Through Trustee
Documents"), the Certificate of the Massachusetts Commissioner of Banks
relating to State Street and originals, or copies certified or otherwise
identified to our satisfaction, of such other documents, corporate records,
certificates, or other instruments as we have deemed necessary or advisable
for the purposes of this opinion.
We have assumed the genuineness of all signatures (other than those on
behalf of State Street and the Pass Through Trustee), the conformity to the
originals of all documents reviewed by us as copies, the authenticity and
completeness of all original documents reviewed by us in original or copy form
and the legal competence of each individual executing any document (other than
on behalf of State Street and the Pass Through Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we are
aware or which are known to us, or with another similar qualification, the
relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion, the
individual lawyers in the firm who have participated directly in the specific
transactions to which this opinion relates or in the preparation of this
opinion and the partner of the firm responsible for State Street corporate
trust matters, and without any special or additional investigation undertaken
for the purposes of this opinion.
Each opinion set forth below relating to the enforceability of any
agreement or instrument against State Street and the Pass Through Trustee, as
applicable, is subject to the following general qualifications:
(i) as to any Pass Through Trustee Document, we assume that such agreement
is the legal, valid and binding obligation of each other party thereto;
(ii) the enforceability of any obligation of State Street and the Pass
Through Trustee may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, marshalling or other similar laws and
rules of law affecting the enforcement of rights and remedies (including such
as may deny giving effect to waivers of debtors' or guarantors' rights) of
creditors generally; and
(iii) the enforcement of any rights and availability of any specific or
equitable relief may in all cases by subject to an implied duty of good faith
and to general principals of equity (regardless of whether such enforceability
is considered in a proceeding at law or in equity).
Subject to the limitations set forth herein, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions expressed herein are limited solely to the internal
substantive laws of the Commonwealth of Massachusetts and the Federal laws of
the United States of America. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
other than our opinion expressed in Paragraph 1 hereof with respect to the
citizenship of State Street, no opinion is expressed as to matters governed by
the Transportation Code or by any other law, statute, rule or regulation of
the United States relating to the acquisition, ownership, registration, use,
operation, maintenance, repair, replacement or sale of or the nature of the
Aircraft, Airframe or the Engines.
With your permission and without investigation, with respect to
paragraph 4 below in connection with our opinion relating to the legality,
validity, binding effect and enforceability of the documents there referred
to, to the extent that the laws of the Commonwealth of Massachusetts do not
govern such documents, we have assumed that the laws of the jurisdiction whose
laws govern such documents are not materially different from the internal
substantive laws of the Commonwealth of Massachusetts.
In rendering the opinion set forth below in paragraph 6 as to certain
Massachusetts tax matters, we have assumed that, for Federal income tax
purposes, the trusts created by the Series Supplements are not classified as
associations taxable as corporations and that the trusts created by the Series
Supplements are grantor trusts under subpart E, Part I of Subchapter J of
Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their respective successors and assigns in
connection with the transactions contemplated by the Operative Agreements and
may not be used or relied upon by any other person or for any other purpose.
Based upon the foregoing, we are of the opinion that:
1. State Street is a Massachusetts trust company, duly organized
and validly existing in good standing with the Massachusetts Commissioner of
Banks under the laws of the Commonwealth of Massachusetts, is a "citizen of
the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has the full corporate power and authority to
execute, deliver and perform its obligations under the Pass Through Trustee
Documents and, in its capacity as Pass Through Trustee, to authenticate the
Pass Through Certificates delivered on the Refunding Date.
2. The execution and delivery of the Pass Through Trustee Documents
(other than the Pass Through Trust Agreement) by State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, and
compliance by State Street or the Pass Through Trustee, as the case may be,
individually or as Pass Through Trustee, with all of the provisions thereof do
not and will not contravene any Massachusetts or Federal law, rule or
regulation governing the banking or trust powers of State Street or the Pass
Through Trustee, or any order or judgment known to us, of any Massachusetts or
Federal court or governmental authority applicable to or binding on State
Street, individually or as Pass Through Trustee, or contravene the provisions
of, or constitute a default under, or result in the creation of a Lien on any
property of State Street or the Pass Through Trustee under, its charter
documents or By-Laws or any indenture, mortgage, chattel mortgage, deed of
trust, conditional sales contract, bank loan or credit agreement, in each case
known to us, or any other agreement or instrument, in each case known to us,
to which State Street, individually or as Pass Through Trustee, is a party or
by which it or any of its property may be bound or affected, other than the
Lien of the Indenture.
3. No order, license, consent, permit, authorization or approval
of or exemption by, and no notice to or filing with, or the taking of any
other action in respect of, any Massachusetts or Federal governmental
authority governing the banking or trust powers of State Street or the Pass
Through Trustee, and no filing, recording, publication or registration in any
public office is required under Massachusetts or Federal law pertaining to its
banking or trust powers for the due execution, delivery or performance by
State Street, individually or as Pass Through Trustee, as the case may be, of
the Pass Through Trustee Documents (other than the Pass Through Trust
Agreement) and of the certificate of authentication, as Pass Through Trustee,
on the Pass Through Certificates, or for the legality, validity, binding
effect or enforceability thereof against State Street or the Pass Through
Trustee, as the case may be.
4. Each of the Pass Through Trustee Documents (other than the Pass
Through Trust Agreement) has been duly authorized, executed and delivered by
State Street, in its individual capacity or as Pass Through Trustee, as the
case may be, and each such document constitutes a legal, valid and binding
obligation of State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, enforceable against State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, in
accordance with its terms.
5. The Pass Through Certificates have been duly authorized and
validly executed, issued, delivered and authenticated by the Pass Through
Trustee pursuant to the Pass Through Trust Agreement and the Series
Supplements; and the Pass Through Certificates are enforceable against the
Pass Through Trustee and the holders thereof are entitled to the benefits of
the Pass Through Trust Agreement and the related Series Supplements.
6. There are no fees, taxes or other governmental charges ("Taxes")
payable under the laws of the Commonwealth of Massachusetts with respect to the
execution and delivery by State Street, in its individual capacity or as Pass
Through Trustee, as the case may be, of any of the Pass Through Trustee
Documents (except for Taxes on any fees payable to State Street in its
individual capacity) which would not have been imposed if State Street did not
have its principal place of business in Massachusetts or did not perform its
administrative duties under the Pass Through Trustee Documents in
Massachusetts. Neither State Street, in its individual capacity or as the
Pass Through Trustee, as the case may be, the Owner Participant, the Owner
Trustee, nor the trusts created by the Series Supplements will, as a result of
the transactions contemplated thereby, be subject to any Taxes under the laws
of the Commonwealth of Massachusetts or any political subdivision thereof
(except for Taxes on any fees payable to State Street in its individual
capacity) which would not have been imposed if State Street did not have its
principal place of business in Massachusetts or did not perform its
administrative duties under the Pass Through Trustee Documents in
Massachusetts, and there are no Taxes under the laws of the Commonwealth of
Massachusetts or any political subdivision thereof (except for Taxes on any
fees payable to State Street in its individual capacity) upon or with respect
to the Aircraft or any Engine or any part of any interest therein, or the
purchase, ownership, delivery, lease, sublease, possession, presence, use,
operation, condition, storage, maintenance, modification, alteration, repair,
sale, return, transfer or other disposition of the Aircraft which would not
have been imposed if State Street did not have its principal place of business
in Massachusetts or did not perform its administrative duties under the Pass
Through Trustee Documents in Massachusetts. We express no opinion as to
whether or not any fees, tax or other charges are now or hereafter may be
payable by the Owner Participant to the Commonwealth of Massachusetts or any
political subdivision thereof in connection with (a) the execution, delivery,
or performance of the Series Supplements, the Participation Agreement or any
of the other Operative Agreements and (b) the making by the Owner Participant
of its investment in the Aircraft.
7. To the best of our knowledge, there are no pending or threatened
actions or proceedings against State Street before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of State Street, individually or
as Pass Through Trustee, to perform its obligations under the Pass Through
Trustee Documents.
Very truly yours,
▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
SCHEDULE A
Lessee
Federal Express Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Trustee
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Indenture Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Pass Through Trustee
State Street Bank and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Owner Participant
PMCC Leasing Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Agent
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Original Loan Participants
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank of America National Trust & Savings Association
GPO Account Admin. #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Commerzbank AG, Atlanta Agency
Promenade Two, Suite 3500
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
NationsBank, N.A. (South)
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Underwriters
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
BA Securities, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
First Chicago Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EXHIBIT B
[FORM OF LEASE AGREEMENT]
[See Exhibit 4.e]
EXHIBIT C
[FORM OF INDENTURE]
[See Exhibit 4.b.1]
EXHIBIT D
[FORM OF TRUST AGREEMENT]
[See Exhibit 4.d]
EXHIBIT E-1
[FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT]
BENEFICIAL INTEREST TRANSFER AGREEMENT (this "Document"), dated as of
_______ __, ____, between ______________, a ______________ corporation
("Transferor") and ______________, a ______________ corporation ("Transferee").
W I T N E S S E T H :
WHEREAS, the parties hereto desire to effect (a) the transfer by
Transferor to Transferee of all of the rights, title and interest of
Transferor in and to its interest (the "Beneficial Interest") under the Trust
Agreement (Federal Express Corporation Trust No. N667FE), dated as of August
1, 1996, as amended and restated as of October 15, 1996 (the "Trust
Agreement"), between Transferor and First Security Bank, National Association,
and the Lessor's Estate created thereunder, and all of Transferor's rights and
obligations under the Participation Agreement (Federal Express Corporation
Trust No. N667FE), dated as of August 1, 1996, as amended and restated as of
October 15, 1996 (the "Participation Agreement"), among Federal Express
Corporation, as Lessee, First Security Bank, National Association, as Owner
Trustee, PMCC Leasing Corporation, as Owner Participant, State Street Bank and
Trust Company, as Indenture Trustee, ▇▇▇▇▇▇ Guaranty Trust Company of New
York, Bank of America National Trust & Savings Association, The Chase
Manhattan Bank, Commerzbank AG, Atlanta Agency and NationsBank, N.A. (South),
as Original Loan Participants and State Street Bank and Trust Company, as Pass
Through Trustee, and under the other Operative Agreements and (b) the
acceptance by Transferee of such transfer and the assumption by Transferee of
such obligations of Transferor thereunder; and
WHEREAS, Section 7.03(d) of the Participation Agreement permits such
transfer and assumption upon satisfaction of certain conditions heretofore or
concurrently herewith being observed;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Participation
Agreement.
2. Transfer. Transferor does hereby sell, convey, assign,
transfer and set over, unto Transferee, as of the Effective Time (as defined
below), all of Transferor's present and future right, title and interest in
and to (a) all of the Beneficial Interest and (b) all of the Owner
Participant's rights and obligations under the Participation Agreement, the
Tax Indemnity Agreement, the Trust Agreement and the other Operative
Agreements and any proceeds therefrom, together with all other documents and
instruments evidencing any of such right, title and interest, except such
rights of Transferor as have arisen or accrued to Transferor prior to the
Effective Time (including without limitation, the right to receive any amounts
due or accrued to Transferor under the Operative Agreements as of a time prior
to the Effective Time and the right to receive any indemnity payment pursuant
to the Participation Agreement or the Tax Indemnity Agreement, with respect to
events occurring prior to such time); all of the foregoing that is being
transferred under this paragraph 2, the "Transferred Interest".
3. Assumption. Transferee hereby accepts the transfer of the
Transferred Interest and, for the benefit of Transferor and the other parties
to the Participation Agreement, assumes and undertakes and agrees to perform
and discharge all of the duties and obligations of Transferor with respect to
the Transferred Interest whenever and wherever accrued (other than duties and
obligations of Transferor required to be performed by it on or prior to the
Effective Time). Transferee hereby confirms that, from and after the
Effective Time, Transferee (a) shall be deemed, to the extent set forth in
Section 2 hereof, the "Owner Participant" party to the Participation
Agreement, the Tax Indemnity Agreement, the Trust Agreement and the other
Operative Agreements and (b) shall be bound by all of the terms of the
Operative Agreements to the extent the same relate to the Transferred Interest.
4. Release of Transferor. At the Effective Time, Transferor shall
be relieved of all of its duties and obligations with respect to the
Transferred Interest under the Operative Agreements, provided, however, that
Transferor shall in no event be released from any such duty or obligations
arising or relating to any event occurring prior to the Effective Time, or on
account of any breach by Transferor of any of its representations, warranties,
covenants or obligations set forth in the Operative Agreements, or for any
fraudulent or willful misconduct engaged in by it prior to the Effective Time,
or from any obligation that relates to any indemnity claimed by Transferor or
any Lessor's Lien attributable to Transferor.
5. Fees and Expenses. The fees, expenses and charges of the
parties to the Participation Agreement incurred in connection with the
transfer effected hereby shall be for the account of [specify
Transferor/Transferee].
6. Payments. Transferor hereby covenants and agrees to pay over to
Transferee, if and when received following the Effective Time, any amounts
(including any sums payable as interest in respect thereof) paid on account of
the Transferred Interest to or for the benefit of Transferor, and Transferee
hereby covenants and agrees to pay over to Transferor, if and when received
following the Effective Time, any amounts (including any sums payable as
interest in respect thereof) paid to or for the benefit of Transferee that are
not attributable to the Transferred Interest and to which Transferor is
otherwise entitled.
7. Investment Purpose. Transferee hereby represents and warrants
that, as of the date hereof, it is acquiring the Transferred Interest for its
account with no present intention of distributing such Transferred Interest
or any part thereof in any manner which would violate the Securities Act of
1933, as amended, but without prejudice, however, to the right of Transferee
at all times to sell or otherwise dispose of all or any part of such
Transferred Interest in compliance with Section 7.03(d) of the
Participation Agreement.
8. Representations and Warranties of Transferor. Transferor
represents and warrants to Transferee that as of the Effective Time:
(a) Organization and Power. Transferor is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and has full corporate power, authority and
legal right to execute, deliver and perform this Agreement and to
enter into and carry out the transactions contemplated hereby and in
the other Operative Agreements (the "Transactions").
(b) Authorization, Execution and Validity. This Agreement has been
duly authorized, executed and delivered by Transferor and constitutes
the legal, valid and binding obligation of Transferor, enforceable
against it in accordance with its terms except as enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and by
general principles of equity.
(c) Conflict. The execution, delivery and performance by
Transferor of this Agreement and compliance by Transferor with all of
the provisions hereof do not contravene any regulation or any order
of any governmental authority applicable to or binding on Transferor,
or contravene the provisions, or constitute a default by Transferor
under, its certificate of incorporation or by-laws or any indenture,
mortgage, contract or other agreement or instrument to which
Transferor is a party or by which Transferor or any of its Properties
is bound or affected.
(d) Consents. No consent, approval or authorization of, or filing,
registration or qualification with, or the giving of notice or the
taking of any other action with respect to, any governmental
authority on the part of Transferor is required in connection with
the execution, delivery and performance by Transferor of this
Agreement.
(e) Litigation. There are no proceedings pending or, to the
knowledge of Transferor, threatened against Transferor before any
governmental authority that would materially and adversely affect the
ability of Transferor to consummate the Transactions.
(f) No Liens. The Trust Estate is free of Lessor's Liens
attributable to Transferor.
(g) Compliance with Operative Agreements. Transferor has fully
performed all of its obligations under the Participation Agreement
and under each other Operative Agreement which obligations by their
terms are required to be satisfied or performed prior to the
Effective Time or prior to the consummation of the Transactions.
(h) Default. As a result of the transfer effected hereby, no
Indenture Default attributable to the Owner Participant or the Owner
Trustee has occurred and is continuing.
Notwithstanding the foregoing or anything else contained in this
Agreement, it makes no representation or warranty in this Agreement
with respect to laws, rules or regulations relating to aviation or to
the nature or use of the equipment owned by the Owner Trustee,
including, without limitation, the airworthiness, value, condition,
workmanship, design, patent or trademark infringement, operation,
merchantability or fitness for use of the Aircraft.
9. Representations and Warranties of Transferee. Transferee
represents and warrants to Transferor and to the other parties to the
Participation Agreement that as of the Effective Time:
(a) Transferee is a corporation duly organized, validly existing
and in good standing under the laws of the State of [ ], has
the full corporate power, authority and legal right to carry on its
business as now conducted, and has full corporate power, authority
and legal right to execute, deliver and perform this Agreement and to
enter into and carry out the transactions contemplated hereby and in
the other Operative Agreements (the "Transactions");
(b) Transferee has full corporate power, authority and legal right
to execute, deliver and enter into this Agreement and the other
Operative Agreements and full corporate power and authority to
perform its obligations thereunder, and such execution, delivery and
performance do not and will not contravene any applicable law or any
order of any governmental authority applicable to or binding on the
Transferee, or contravene the provisions of, or constitute a default
under, or result in the creation of any Lien upon the property of the
Transferee under, its articles of incorporation or by-laws or any
material indenture, mortgage, contract or other agreement or
instrument to which the Transferee is a party or by which it or any
of its property may be bound or affected;
(c) the execution, delivery and performance of this Agreement by the
Transferee (i) has been duly authorized by all necessary corporate
action and (ii) does not require any approval of the shareholders of
the Transferee or any approval or consent of, or notice to, any
trustee or holders of any indebtedness or obligation of the
Transferee, except for such approvals and consents as have already
been obtained;
(d) this Agreement has been duly executed and delivered by the
Transferee, and constitutes the legal, valid and binding obligation
of the Transferee, enforceable against the Transferee in accordance
with its terms, except as the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally and by general principles of equity;
(e) there are no proceedings or actions pending or, to the
knowledge of the Transferee, threatened against the Transferee before
any governmental authority in which there is a reasonable probability
of an adverse determination that individually or in the aggregate
would materially and adversely impair the ability of the Transferee
to perform its obligations under this Agreement or the Operative
Agreements, or which involve the Transactions or question the
validity of any Operative Agreement to which the Owner Participant is
a party or any action taken or to be taken pursuant thereto; and the
Transferee is not in default with respect to any order of any
governmental authority which involves the Transactions or the default
under which would materially and adversely affect the ability of the
Transferee to perform its obligations under this Agreement or any of
the Operative Agreements;
(f) no consent, approval, order or authorization of, giving of
notice to, or registration with, or taking of any other action in
respect of, any governmental authority is required under any law for
the execution and delivery by the Transferee of this Agreement, or
the carrying out by the Transferee of any of the Transactions, other
than any such consent, approval, order, authorization, registration,
notice or action as has been duly obtained, given or taken;
(g) the Lessor's Estate is free of any Lessor's Liens attributable
to the Transferee;
(h) the Transferee, upon execution of this Agreement, will not be
in default under any of the Operative Agreements;
(i) no part of the funds to be used by it to acquire the interests
acquired by the Owner Participant under the Participation Agreement
constitutes assets (within the meaning of ERISA and any applicable
rules and regulations) of any employee benefit plan subject to Title
I of ERISA or of any plan or individual retirement account subject to
Section 4975 of the Code;
(j) Transferee is a "U.S. Person" as defined in Section 7701(a)(30)
of the Code and is not a tax resident of another country and if it
shall at any time cease to be such a "U.S. Person" or shall become a
tax resident of another country, it shall furnish to the Agent and
each Loan Certificate Holder an indemnity, in form and substance
reasonably satisfactory to such Loan Certificate Holder, for any
Taxes that may be imposed on such Holder as a result of its failure
to be such a "U.S. Person" or as a result of its being a tax resident
of another country, and it shall be personally liable for any debt
service to the extent that the receipt of rentals is reduced by
reason of any withholding Taxes that result from such failure to be
such a "U.S. Person" or from being a tax resident of another country;
(k) [After giving effect to a voting trust or similar agreement(1),
Transferee is a Citizen of the United States] [applicable if
Aircraft is registered in the United States or is proposed to be
so registered]
-----------------------
(1) Such voting trust or similar agreement must be reasonably
satisfactory to the Lessor and the Indenture Trustee.
(l) On and as of the Effective Date, the representations and
warranties of the Owner Participant in Article 7 of the Participation
Agreement are true and correct as to the Transferee; and
(m) Transferee satisfies the conditions applicable to a transferee
of the Beneficial Interest set forth in Section 7.03(d) of the
Participation Agreement, including without limitation, the condition
set forth in the last sentence thereof [and to the extent the same
has been requested by the Lessee or the Indenture Trustee, Transferee
has heretofore provided to the Lessee and the Indenture Trustee its
most recent audited financial statements, which show a consolidated
tangible net worth or combined capital and surplus of at least
$75,000,000] [remove bracketed language if an Owner Participant
Guaranty is provided].
(n) the Transferee has, independently and without reliance upon any
other party (including without limitation the Transferor) and based
on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement,
and the Transferee has established adequate means of obtaining from
Lessee on a continuing basis information pertaining to, and is now
and on a continuing basis will be completely familiar with, the
financial condition, operations, properties and prospects of Lessee.
Notwithstanding the foregoing or anything else contained in this Agreement, it
makes no representation or warranty in this Agreement with respect to laws,
rules or regulations relating to aviation or to the nature or use of the
equipment owned by the Owner Trustee, including, without limitation, the
airworthiness, value, condition, workmanship, design, patent or trademark
infringement, operation, merchantability or fitness for use of the Aircraft,
other than such laws, rules or regulations relating to the citizenship
requirements of it under applicable aviation law.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
11. Effectiveness. This Agreement shall be effective upon the mutual
execution and delivery of this Agreement (the "Effective Time").
12. Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute a single instrument. It
shall not be necessary that any counterpart be signed by both parties so long
as each party shall sign at least one counterpart.
13. Beneficiaries. Each of the Owner Trustee, the Indenture Trustee,
the Original Loan Participants and the Lessee, together with their respective
successors and permitted assigns, is and shall be deemed a third party
beneficiary of this Agreement entitled to enforce this Agreement directly and
in its own name and enforce any rights or claims of the parties hereto.
14. Further Assurances. Each party agrees that from time to time
after the Effective Time, it shall execute and deliver or cause to be executed
and delivered such instruments, documents and papers, and take all such
further action as may be reasonably required in order to consummate fully the
purposes of this Agreement and to implement the transactions contemplated
hereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
[TRANSFEROR]
By:____________________________
Name:
Title:
[TRANSFEREE]
By:____________________________
Name:
Title:
EXHIBIT E-2
[FORM OF OWNER PARTICIPANT GUARANTY]
TRANSFEREE'S PARENT GUARANTY, dated as of ___________ __, ____, (this
"Guaranty") by ____________________, a ___________ corporation (the
"Guarantor"), to First Security Bank, National Association, in its individual
capacity and as Owner Trustee, State Street Bank and Trust Company, as
Indenture Trustee, the Original Loan Participants and the Lessee referred to
in the Participation Agreement described below (collectively, together with
their successors and assigns and the holders from time to time of the Loan
Certificates, the "Beneficiaries").
W I T N E S S E T H :
WHEREAS, ___________, a ____________ corporation (the "Transferor"), is
party to the Participation Agreement (Federal Express Corporation Trust No.
N667FE), dated as of August 1, 1996, as amended and restated as of October 15,
1996 (as amended, modified or supplemented from time to time, the
"Participation Agreement"), among Federal Express Corporation, as Lessee, PMCC
Leasing Corporation, as Owner Participant, First Security Bank, National
Association, as Owner Trustee, State Street Bank and Trust Company, as
Indenture Trustee, ▇▇▇▇▇▇ Guaranty Trust Company of New York, Bank of America
National Trust & Savings Association, The Chase Manhattan Bank, Commerzbank
AG, Atlanta Agency and NationsBank, N.A. (South), as Original Loan
Participants and State Street Bank and Trust Company, as Pass Through Trustee;
and
WHEREAS, the Transferor wishes to transfer, among other things, all of
the rights, title and interest of the Transferor in and to the Beneficial
Interest under the Trust Agreement and the Lessor's Estate created thereunder,
and all of the Transferor's rights and obligations under the Participation
Agreement, the Trust Agreement and the other Operative Agreements to
__________________, a _______________ [corporation] (together with its
successors and assigns, the "Transferee"), a subsidiary of the Guarantor,
pursuant to the Beneficial Interest Transfer Agreement, dated as of the date
hereof (the "Transfer Agreement"), between the Transferor and the Transferee;
and
WHEREAS, the terms of the Participation Agreement provide that the
aforementioned transfer is conditioned upon the execution and delivery of this
Guaranty by the Guarantor;
NOW, THEREFORE, in order that the Transferor may make the aforementioned
transfer to the Transferee, the Guarantor hereby agrees with and for the
benefit of the Beneficiaries as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the respective meanings assigned thereto in the Participation
Agreement or the Transfer Agreement.
2. Guaranty. The Guarantor hereby unconditionally and irrevocably
guarantees, as primary obligor and not merely surety, to the Beneficiaries the
prompt and complete payment by the Transferee when due of all payment
obligations of the Transferee under the Operative Agreements without offset or
deduction and the timely performance of all other obligations of the
Transferee thereunder (such payment and other obligations, the "Obligations"),
and the Guarantor further agrees to pay any and all expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be paid
or incurred by the Beneficiaries in enforcing any rights with respect to, or
collecting, any or all of the Obligations and/or enforcing any rights with
respect to, or collecting against, the Guarantor under this Guaranty.
The Guarantor will not exercise any rights that it may now or
hereafter acquire against Transferee that arise from the existence, payment,
performance or enforcement of the Guarantor's Obligations under this Guaranty,
the Transferred Interest or the Operative Agreements, including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution
or indemnification and any right to participate in any claim or remedy of any
Beneficiary against Transferee or any collateral, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from Transferee,
directly or indirectly, in cash or other property or by set-off or in any
other manner, payment or security on account of such claim, remedy or right,
unless and until all of the Obligations have been performed in full and all
other amounts payable under this Guaranty shall have been paid in full in
cash. If any amount shall be paid to the Guarantor in violation of the
preceding sentence at any time prior to the final payment in full in cash of
the Obligations and all other amounts payable under this Guaranty, such amount
shall be held in trust for the benefit of any Beneficiary and shall forthwith
be paid to such Beneficiary to be credited and applied to the Obligations and
all other amounts payable under this Guaranty, whether matured or unmatured,
in accordance with the terms of the Operative Agreements, or to be held as
collateral for any Obligations or other amounts payable under this Guaranty
thereafter arising.
3. No Subrogation. Notwithstanding anything to the contrary in
this Guaranty, the Guarantor hereby agrees not to assert any rights which may
have arisen in connection with this Guaranty to be subrogated to any of the
rights (whether contractual, under the Bankruptcy Code, under common law or
otherwise) of any Beneficiary against the Transferee for the payment of the
obligations until all of the Obligations shall have been satisfied by payment
and performance in full.
4. Amendments with Respect to the Obligations; Waiver of Rights.
The Guarantor shall remain fully obligated hereunder notwithstanding that,
without any reservation of rights against the Guarantor and without notice to
or further assent by the Guarantor, any demand for payment or performance of
any of the Obligations made by any Beneficiary may be rescinded by such party
and any of the obligations continued, and the Obligations, may, from time to
time, in whole or part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by any Beneficiary and any
Operative Agreement may be amended, modified, supplemented or terminated, in
whole or in part, in accordance with the provisions thereof from time to time.
When making any demand hereunder against the Guarantor, a Beneficiary may, but
shall be under no obligation to, make a similar demand on the Transferee, and
any failure by a Beneficiary to make any such demand or to collect any
payments from the Transferee or any release of the Transferee shall not
relieve the Guarantor of its obligations or liabilities hereunder, and shall
not impair or affect the rights and remedies, express or implied, or as a
matter of law, of any Beneficiary against the Guarantor. For the purposes
hereof, "demand" shall include the commencement and continuance of any legal
proceedings. The Guarantor represents and warrants that it is the parent of
the Transferee, and agrees that its obligations hereunder shall continue
unimpaired, even if the Guarantor is no longer an Affiliate of the Transferee.
5. Guaranty Absolute and Unconditional. The Guarantor guarantees
that the Obligations will be paid and performed strictly in accordance with
the terms of the Transfer Agreement and the Operative Agreements, regardless
of any law, regulation or order now or hereafter in effect in any jurisdiction
affecting any such terms or the rights of any Beneficiary with respect
thereto. The obligations of the Guarantor under this Guaranty are independent
of the Obligations or any other obligations of any other party, and a separate
action or actions may be brought and prosecuted against the Guarantor to
enforce this Guaranty, irrespective of whether the Transferee or any other
party is joined in any such action or actions. The Guarantor waives any and
all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by any Beneficiary upon this
Guaranty or acceptance of this Guaranty; the Obligations, and any of them,
shall conclusively be deemed to have been created, contracted or incurred, or
renewed, extended, amended or waived, in reliance upon this Guaranty; and all
dealings between the Transferee or the Guarantor and any Beneficiary shall
likewise be conclusively presumed to have been had or consummated in reliance
upon this Guaranty. The Guarantor waives, to the fullest extent permitted by
applicable law, diligence, presentment, promptness, protest, mitigation of
damages by the Beneficiaries demand for payment and notice of default or
nonpayment to or upon the Transferee or the Guarantor with respect to the
Obligations. The Guarantor further waives any right to revoke this Guaranty,
and acknowledges that this Guaranty is continuing in nature and applies to all
Obligations, whether existing now or in the future. The Guarantor understands
and agrees that, to the fullest extent permitted by applicable law, this
Guaranty shall be construed as a continuing, absolute and unconditional
guaranty of payment and performance (and not merely of collectibility) without
regard to:
(a) the validity, regularity or enforceability of the Transfer
Agreement, any Operative Agreement, or any of the Obligations at any
time or from time to time held by any Beneficiary;
(b) any defense, set-off, rebate, adjustment, withholding,
deduction or counterclaim (other than a defense of payment or
performance) that may at any time be available to or be asserted by
the Transferee against any Beneficiary or any agreement or instrument
relating thereto or;
(c) any change in the time, manner or place of payment of, or in
any other term of, all or any of the obligations or any other
obligations of any other party under the Transfer Agreement, the
Operative Agreements, or any other amendment or waiver of or any
consent to departure from the Transfer Agreement or other Operative
Agreements;
(d) any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Obligations;
(e) any change, restructuring or termination of the corporate
structure or existence of the Guarantor or the Transferee or any of
the Affiliates of either;
(f) any defect in the title, condition, design, operation or
fitness of, or any interference with the operation, use or possession
of, the Aircraft;
(g) any failure to establish, perfect or preserve title to or any
security interest in or to the Aircraft or any other collateral
security for the Obligations; or
(h) any other circumstance whatsoever or any existence of or
reliance on any representation by any Beneficiary that might
otherwise constitute a defense available to, or a discharge of, the
Guarantor or any other guarantor or surety.
When pursuing its rights and remedies hereunder against the Guarantor,
any Beneficiary may, but shall be under no obligation to, pursue such rights
and remedies as it may have against the Transferee for the Obligations, and
any failure by any Beneficiary to pursue such other rights or remedies or to
collect any payments from the Transferee, or any release of the Transferee,
shall not, to the fullest extent permitted by applicable law, relieve the
Guarantor of any liability hereunder, and shall not impair or affect the
rights and remedies, whether express, implied or available as a matter of law,
of any Beneficiary against the Guarantor. This Guaranty is a continuing
guaranty and shall remain in full force and effect until the earlier of (x)
the date that all of the Obligations are satisfied by payment and performance
in full and (y) the date that all right, title and interest of the Transferee
shall have been transferred to a Person meeting the requirements of Section
7.03(d) of the Participation Agreement in accordance with said section;
provided that this Guaranty shall remain in full force and effect with respect
to obligations relating to the period prior to such transfer.
6. Reinstatement. This Guaranty shall continue to be effective,
or be reinstated, as the case may be, if at any time payment, or any part
thereof, of any of the Obligations is rescinded or must otherwise be restored
or returned by any Beneficiary upon the insolvency, bankruptcy dissolution,
liquidation or reorganization of the Transferee or the Guarantor, or upon or
as a result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Transferee or the Guarantor or any
substantial part of its property, or otherwise, all as though such payments
had not been made and the Guarantor agrees that it will indemnify any such
Beneficiary on demand for all reasonable costs and expenses (including,
without limitation, reasonable fees and expenses of counsel) by such
Beneficiary in connection with such rescission or restoration.
7. Payments. The Guarantor hereby guarantees that payments
hereunder shall be paid without set-off, counterclaim, deduction, rebate,
adjustment or withholding, and shall be made in U.S. Dollars in immediately
available funds.
8. Representations and Warranties. The Guarantor hereby
represents and warrants that:
(a) the Guarantor is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation and the Transferee is currently a subsidiary of the
Guarantor;
(b) the Guarantor has the power and authority and the legal right
to execute and deliver, and to perform its obligations under, this
Guaranty, and has taken all necessary corporate action to authorize
its execution, delivery and performance of this Guaranty;
(c) this Guaranty constitutes a legal, valid and binding obligation
of the Guarantor enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally;
(d) the execution, delivery and performance of this Guaranty will
not violate any provision of any requirement of law or contractual
obligation of the Guarantor or any of its constitutive documents;
(e) no consent or authorization of, filing with, or other act by or
in respect of, any arbitrator or governmental authority and no
consent of any other person is required in connection with the
execution, delivery, performance, validity or enforceability of this
Guaranty;
(f) the Guarantor is a [a bank, savings institution, finance
company, leasing company or trust company, national banking
association acting for its own account or in a fiduciary capacity as
trustee or agent under any pension, retirement, profit sharing or
similar trust or fund, insurance company, fraternal benefit society
or corporation acting for its own account having a combined capital
and surplus (or, if applicable, consolidated tangible net worth or
its equivalent)] of not less than $75,000,000 [and has, if the same
have been requested by the Lessee or the Indenture Trustee,
heretofore furnished to the Lessee and the Indenture Trustee copies
of its most recent audited financial statements];
(g) there are no conditions precedent to the effectiveness of this
Guaranty that have not been satisfied or waived; and
(h) the Guarantor has, independently and without reliance upon any
Beneficiary and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to
enter into this Guaranty, and the Guarantor has established adequate
means of obtaining from Transferee on a continuing basis information
pertaining to, and is now and on a continuing basis will be
completely familiar with, the financial condition, operations,
properties and prospects of Transferee.
9. Severability. Any provision of this Guaranty that 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.
10. Jurisdiction; Waiver of Jury Trial, Etc.
(a) The Guarantor hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any
New York State court or federal court of the United States of America
sitting in New York, New York, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to
this Guaranty, the Transfer Agreement or any Operative Agreement to
which it is or is to be a party, or for recognition or enforcement
of any judgment, and the Guarantor hereby irrevocably and
unconditionally agrees that all claims in respect of any such action
or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. The
Guarantor agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided
by law. Nothing in this Guaranty shall affect any right that any
party may otherwise have to bring any action or proceeding relating
to this Guaranty, the Transfer Agreement or any Operative Agreement
to which it is or is to be a party in the courts of any jurisdiction.
(b) The Guarantor irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection
that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Guaranty, the
Transfer Agreement or any Operative Agreement to which it is or is to
be a party in any New York State or federal court. The Guarantor
hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
11. Section Headings. The Section headings used in this Guaranty
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
12. No Waiver; Cumulative Remedies. No Beneficiary shall by any act
(except by a written instrument pursuant to Section 13 hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any breach of any of the terms and
conditions hereof. No failure to exercise, nor any delay in exercising, on
the part of any Beneficiary, any right, power or privilege hereunder shall
operate as a waiver thereof. No single or partial exercise of any right,
power or privilege hereunder shall preclude any other or further exercise
thereof or the exercise of any other right power or privilege. A waiver by a
Beneficiary of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy that such Beneficiary would
otherwise have on any future occasion. The rights and remedies herein
provided are cumulative, may be exercised singly or concurrently and are not
exclusive of any rights or remedies provided by law.
13. Amendments and Waivers. None of the terms or provisions of
this Guaranty may be waived, amended or supplemented or otherwise modified
except by a written instrument executed by the Guarantor and each
Beneficiary.
14. Successors and Assigns. This Guaranty shall be binding upon
the successors and assigns of the Guarantor and shall inure to the benefit
of the Beneficiaries and their respective successors and permitted assigns
but Guarantor may not assign this Guaranty without prior written consent of
the Beneficiaries except to an assignee making, as of the date of such
assignment, (i) representations and warranties substantially similar to
those contained in Section 8 hereof and (ii) a representation that it is a
U.S. citizen, unless, in the case of the preceding clause (ii) any of (a)
the aircraft is not then registered in the United States nor contemplated
to be so registered or (b) a voting trust or similar arrangement reasonably
satisfactory to the Beneficiaries is in place with respect to such
registration or (c) it is not necessary for the Guarantor to be a U.S.
citizen in order for the aircraft to remain registered in the United
States.
15. GOVERNING LAW. THIS GUARANTY SHALL BE GOVERNED BY AND BE
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
16. Notices. All notices, requests and demands to or upon the
Guarantor or any Beneficiary to be effective shall be in writing and, unless
otherwise expressly provided herein, shall be deemed to have been duly given
or made, when delivered by hand or by mail, upon receipt, or, when delivered
by facsimile transmission, upon being sent and confirmed, addressed (a) in the
case of the Guarantor, to the Guarantor at the address set forth under its
signature below, and (b) in the case of any Beneficiary, to such Beneficiary
at the address provided for such Beneficiary in or pursuant to the
Participation Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be duly
executed and delivered by its duly authorized officer as of the day and year
first above written.
[NAME OF GUARANTOR]
_________________________________
Name:
Title:
__________________________________
__________________________________
__________________________________
Address for Notices: