EX-99(C)
EXHIBIT 99(C)
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TRUST INDENTURE AND SECURITY AGREEMENT
[NW ____ _]
Dated as of [_______________]
Between
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
except as expressly stated herein,
but solely as Owner Trustee,
Owner Trustee
and
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity,
except as expressly stated herein,
but solely as Indenture Trustee,
Indenture Trustee
_______________________
SECURED CERTIFICATES COVERING
ONE [AIRBUS A319-114] [BOEING 757-251] AIRCRAFT
BEARING U.S. REGISTRATION XXXX N[______]
LEASED BY NORTHWEST AIRLINES, INC.
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . 7
SECTION 1.02. Reference to Other Documents . . . . . . . . . . 15
ARTICLE II
THE SECURED CERTIFICATES
SECTION 2.01. Form of Secured Certificates . . . . . . . . . . 15
SECTION 2.02. Issuance and Terms of Secured Certificates . . . 21
SECTION 2.03. Payments from Trust Indenture Estate Only . . . . 24
SECTION 2.04. Method of Payment . . . . . . . . . . . . . . . . 26
SECTION 2.05. Application of Payments . . . . . . . . . . . . . 29
SECTION 2.06. Termination of Interest in Trust Indenture
Estate . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.07. Registration, Transfer and Exchange of
Secured Certificates . . . . . . . . . . . . . 30
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Secured
Certificates . . . . . . . . . . . . . . . . . 32
SECTION 2.09. Payment of Expenses on Transfer; Cancellation . . 33
SECTION 2.10. Mandatory Redemptions of Secured Certificates . . 33
SECTION 2.11. Voluntary Redemptions of Secured Certificates . . 33
SECTION 2.12. Redemptions; Notice of Redemption . . . . . . . . 34
SECTION 2.13. Assumption of Secured Certificates by Lessee . . 35
SECTION 2.14. Option to Purchase Secured Certificates . . . . . 35
SECTION 2.15. Subordination . . . . . . . . . . . . . . . . . . 37
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Basic Rent Distribution . . . . . . . . . . . . . 37
SECTION 3.02. Event of Loss; Replacement; Voluntary
Termination; Refinancing . . . . . . . . . . . 39
SECTION 3.03. Payments After Event of Default . . . . . . . . . 40
SECTION 3.04. Certain Payments . . . . . . . . . . . . . . . . 42
SECTION 3.05. Other Payments . . . . . . . . . . . . . . . . . 43
SECTION 3.06. Payments to the Owner Trustee . . . . . . . . . . 44
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SECTION 3.07. Application of Payments Under Guarantee . . . . . 44
ARTICLE IV
COVENANTS OF THE OWNER TRUSTEE; EVENTS OF
DEFAULT; REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of the Owner Trustee . . . . . . . . . 45
SECTION 4.02. Event of Default . . . . . . . . . . . . . . . . 46
SECTION 4.03. Certain Rights . . . . . . . . . . . . . . . . . 49
SECTION 4.04. Remedies . . . . . . . . . . . . . . . . . . . . 50
SECTION 4.05. Return of Aircraft, Etc . . . . . . . . . . . . . 53
SECTION 4.06. Remedies Cumulative . . . . . . . . . . . . . . . 55
SECTION 4.07. Discontinuance of Proceedings . . . . . . . . . . 55
SECTION 4.08. Waiver of Past Defaults . . . . . . . . . . . . . 55
SECTION 4.09. Appointment of Receiver . . . . . . . . . . . . . 56
SECTION 4.10. Indenture Trustee Authorized to Execute Bills
of Sale, Etc. . . . . . . . . . . . . . . . . . 56
SECTION 4.11. Rights of Certificate Holders to Receive
Payment . . . . . . . . . . . . . . . . . . . . 57
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Event of Default . . . . . . . . . . . 57
SECTION 5.02. Action upon Instructions; Certain Rights and
Limitations . . . . . . . . . . . . . . . . . . 58
SECTION 5.03. Indemnification . . . . . . . . . . . . . . . . . 61
SECTION 5.04. No Duties Except as Specified in Trust
Indenture or Instructions . . . . . . . . . . . 62
SECTION 5.05. No Action Except Under Lease, Trust Indenture
or Instructions . . . . . . . . . . . . . . . . 62
SECTION 5.06. Replacement Airframes and Replacement Engines . . 62
SECTION 5.07. Indenture Supplements for Replacements . . . . . 66
SECTION 5.08. Effect of Replacement . . . . . . . . . . . . . . 66
SECTION 5.09. Investment of Amounts Held by Indenture
Trustee . . . . . . . . . . . . . . . . . . . . 66
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties . . . . . . . . . 67
SECTION 6.02. Absence of Duties . . . . . . . . . . . . . . . . 68
SECTION 6.03. No Representations or Warranties as to
Aircraft or Documents . . . . . . . . . . . . . 68
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SECTION 6.04. No Segregation of Monies; No Interest . . . . . . 69
SECTION 6.05. Reliance; Agreements; Advice of Counsel . . . . . 69
SECTION 6.06. Capacity in Which Acting . . . . . . . . . . . . 70
SECTION 6.07. Compensation . . . . . . . . . . . . . . . . . . 70
SECTION 6.08. Instructions from Certificate Holders . . . . . . 71
ARTICLE VII
INDEMNIFICATION OF THE INDENTURE TRUSTEE BY THE OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification . . . . . . . . . . . . 71
ARTICLE VIII
SUCCESSOR AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee . . . . . . . . 72
SECTION 8.02. Resignation of Indenture Trustee; Appointment
of Successor. . . . . . . . . . . . . . . . . . 73
SECTION 8.03. Appointment of Additional and Separate
Trustees . . . . . . . . . . . . . . . . . . . . . . . . 74
ARTICLE IX
SUPPLEMENT AND AMENDMENTS TO THIS TRUST INDENTURE
AND OTHER DOCUMENTS
SECTION 9.01. Instructions of Majority; Limitations . . . . . . 76
SECTION 9.02. Trustees Protected . . . . . . . . . . . . . . . 79
SECTION 9.03. Documents Mailed to Certificate Holders . . . . . 79
SECTION 9.04. No Request Necessary for Lease Supplement or
Trust Agreement and Indenture Supplement . . . 79
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Trust Indenture . . . . . . . . . 80
SECTION 10.02. No Legal Title to Trust Indenture Estate in
Certificate Holders . . . . . . . . . . . . . 80
SECTION 10.03. Sale of Aircraft by Indenture Trustee Is
Binding . . . . . . . . . . . . . . . . . . . 81
SECTION 10.04. Trust Indenture for Benefit of the Owner
Trustee, the Indenture Trustee, Owner
Participant, Lessee and Certificate Holders. . 81
SECTION 10.05. Notices . . . . . . . . . . . . . . . . . . . . 81
SECTION 10.06. Severability . . . . . . . . . . . . . . . . . . 82
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SECTION 10.07. No Oral Modification or Continuing Waivers . . . 82
SECTION 10.08. Successors and Assigns . . . . . . . . . . . . . 82
SECTION 10.09. Headings . . . . . . . . . . . . . . . . . . . . 83
SECTION 10.10. Normal Commercial Relations . . . . . . . . . . 83
SECTION 10.11. Governing Law; Counterpart Form . . . . . . . . 83
SECTION 10.12. Voting By Certificate Holders . . . . . . . . . 83
SECTION 10.13. Bankruptcy . . . . . . . . . . . . . . . . . . . 83
SECTION 10.14. No Action Contrary to Lessee's Rights Under
the Lease . . . . . . . . . . . . . . . . . . 84
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EXHIBIT A Form of Trust Agreement and Indenture Supplement
SCHEDULE I Secured Certificates Amortization
SCHEDULE II Pass Through Trust Agreements
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TRUST INDENTURE AND SECURITY AGREEMENT
[NW ____ _]
TRUST INDENTURE AND SECURITY AGREEMENT [NW ____ _], dated as
of [_______________] ("Trust Indenture") between FIRST SECURITY BANK,
NATIONAL ASSOCIATION, a national banking association, not in its individual
capacity, except as expressly stated herein, but solely as Owner Trustee
under the Trust Agreement referred to below (together with its successors
under the Trust Agreement, the "Owner Trustee"), and STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company, not in its individual capacity,
except as expressly stated herein, but solely as Indenture Trustee hereunder
(together with its successors hereunder, the "Indenture Trustee").
W I T N E S S E T H
WHEREAS, all capitalized terms used herein shall have the
respective meanings set forth or referred to in Article I hereof;
WHEREAS, the Owner Participant and FSB have entered into the
Trust Agreement whereby, among other things, (i) the Owner Trustee has
established a certain trust for the use and benefit of the Owner Participant
subject, however, to the Trust Indenture Estate created pursuant hereto for
the use and benefit of, and with the priority of payment to, the holders of
Secured Certificates issued hereunder, and (ii) the Owner Trustee has been
authorized and directed to execute and deliver this Trust Indenture;
WHEREAS, the parties desire by this Trust Indenture, among
other things, (i) to provide for the issuance by the Owner Trustee to the
Pass Through Trustees (or their designee) of the Secured Certificates
evidencing the participation of the Pass Through Trustees in the payment of
Lessor's Cost for the Aircraft, as provided in the Participation Agreement
and (ii) to provide for the assignment, mortgage and pledge by the Owner
Trustee to the Indenture Trustee, as part of the Trust Indenture Estate
hereunder, among other things, of all of the Owner Trustee's right, title and
interest in and to the Aircraft and, except as hereinafter expressly
provided, all of the Owner Trustee's right, title and interest in, to and
under the Lease and all payments and other amounts received hereunder or
thereunder in accordance with the terms hereof or thereof, as security for,
among other things, the Owner Trustee's obligations to the Indenture Trustee,
for the ratable benefit and security of the Certificate Holders, subject to
Section 2.15 and Article III hereof;
WHEREAS, all things have been done to make the Secured
Certificates, when executed by the Owner Trustee and authenticated and
delivered by the Indenture Trustee hereunder, the valid, binding and
enforceable obligations of the Owner Trustee; and
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WHEREAS, all things necessary to make this Trust Indenture
the valid, binding and legal obligation of the Owner Trustee for the uses and
purposes herein set forth, in accordance with its terms, have been done and
performed and have happened:
GRANTING CLAUSE
NOW, THEREFORE, THIS TRUST INDENTURE AND SECURITY AGREEMENT
WITNESSETH, that, to secure the prompt payment of the Principal Amount of,
interest on, Make-Whole Amount, if any, and all other amounts due with
respect to, all Secured Certificates from time to time outstanding hereunder
and the performance and observance by the Owner Trustee of all the
agreements, covenants and provisions herein and in the Participation
Agreement and the Secured Certificates contained, for the benefit of the
Certificate Holders and the Indenture Indemnitees and the prompt payment of
all amounts from time to time owing hereunder and under the Participation
Agreement to the Certificate Holders and the Indenture Indemnitees by the
Owner Trustee or Lessee and for the uses and purposes and subject to the
terms and provisions hereof, and in consideration of the premises and of the
covenants herein contained, and of the acceptance of the Secured Certificates
by the holders thereof, and for other good and valuable consideration the
receipt and adequacy whereof are hereby acknowledged, the Owner Trustee has
granted, bargained, sold, assigned, transferred, conveyed, mortgaged, pledged
and confirmed, and does hereby grant, bargain, sell, assign, transfer,
convey, mortgage, pledge and confirm, unto the Indenture Trustee, its
successors in trust and assigns, for the security and benefit of the
Certificate Holders, a first priority security interest in and mortgage lien
on all right, title and interest of the Owner Trustee in, to and under the
following described property, rights and privileges, other than Excluded
Payments (which collectively, excluding Excluded Payments but including all
property hereafter specifically subjected to the Lien of this Trust Indenture
by the Trust Agreement and Indenture Supplement or any mortgage supplemental
hereto, are included within the Trust Indenture Estate), to wit:
(1) the Aircraft (including the Airframe and the Engines
and all replacements thereof and substitutions therefor to which the Owner
Trustee shall from time to time acquire title as provided herein and in the
Lease), all as more particularly described in the Trust Agreement and
Indenture Supplement executed and delivered with respect to the Aircraft or
any such replacements or substitutions therefor, as provided in this
Indenture;
(2) the Lease and any Lease Supplement and all Rent
thereunder (including, without limitation, all amounts of Basic Rent,
Supplemental Rent and payments of any kind thereunder (excluding any Excluded
Payments)), and the Guarantee (excluding any Excluded Payments);
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(3) the Purchase Agreement [and the Guaranty -- A319's
only] ([each] to the extent specified in the Purchase Agreement Assignment),
the Purchase Agreement Assignment, the Consent and Agreement and the Xxxx of
Sale;
(4) all rents, issues, profits, revenues and other
income of the property subjected or required to be subjected to the lien of
this Indenture;
(5) all insurance and requisition proceeds with respect
to the Aircraft, including but not limited to the insurance required under
Section 11 of the Lease, but excluding insurance proceeds described in
clauses (ii) and (iii) of the definition of Excluded Payments;
(6) all rights of the Owner Trustee to amounts paid or
payable by Lessee to the Owner Trustee under the Participation Agreement and
all rights of the Owner Trustee to enforce payments of any such amounts
thereunder, but excluding amounts described in clauses (i) and (v) (and
clauses (vii), (viii) and (ix) as they relate thereto) of the definition of
Excluded Payments;
(7) all monies and securities from time to time
deposited or required to be deposited with the Indenture Trustee pursuant to
any terms of this Indenture or the Lease or required hereby or by the Lease
to be held by the Indenture Trustee hereunder (other than Excluded Payments);
and
(8) all proceeds of the foregoing.
BUT EXCLUDING from the foregoing and from the Trust
Indenture Estate all Excluded Payments, and the right to enforce and collect
the same, and SUBJECT TO all of the terms and conditions of this Trust
Indenture and the rights of the Owner Trustee and the Owner Participant
hereunder.
Concurrently with the delivery hereof, the Owner Trustee is
delivering to the Indenture Trustee the original executed counterpart of the
Lease and the Lease Supplement No. 1 (to each of which a chattel paper
receipt is attached), and executed copies of the Participation Agreement, and
the Purchase Agreement Assignment with the Consent and Agreement attached
thereto.
TO HAVE AND TO HOLD all and singular the aforesaid property
unto the Indenture Trustee, and its successors and assigns, in trust for the
benefit and security of the Certificate Holders, except as provided in
Section 2.15 and Article III hereof without any preference, distinction or
priority of any one Secured Certificate over any other by reason of priority
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of time of issue, sale, negotiation, date of maturity thereof or otherwise
for any reason whatsoever, and for the uses and purposes and in all cases and
as to all property specified in paragraphs (1) through (8) inclusive above,
subject to the terms and provisions set forth in this Trust Indenture.
It is expressly agreed that anything herein contained to the
contrary notwithstanding, the Owner Trustee shall remain liable under each of
the Indenture Agreements to which it is a party to perform all of the
obligations assumed by it thereunder, except to the extent prohibited or
excluded from doing so pursuant to the terms and provisions thereof, and the
Indenture Trustee and the Certificate Holders shall have no obligation or
liability under the Indenture Agreements, by reason of or arising out of the
assignment hereunder, nor shall the Indenture Trustee or the Certificate
Holders be required or obligated in any manner to perform or fulfill any
obligations of the Owner Trustee under or pursuant to any of the Indenture
Agreements to which it is a party, or, except as herein expressly provided,
to make any payment, or to make any inquiry as to the nature or sufficiency
of any payment received by it, or present or file any claim, or take any
action to collect or enforce the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
The Owner Trustee does hereby constitute the Indenture
Trustee the true and lawful attorney of the Owner Trustee, irrevocably,
granted for good and valuable consideration and coupled with an interest and
with full power of substitution, and with full power (in the name of the
Owner Trustee or otherwise) to ask for, require, demand, receive, compound
and give acquittance for any and all monies and claims for monies (in each
case including insurance and requisition proceeds but in all cases excluding
Excluded Payments) due and to become due under or arising out of the
Indenture Agreements, and all other property which now or hereafter
constitutes part of the Trust Indenture Estate, to endorse any checks or
other instruments or orders in connection therewith and to file any claims or
to take any action or to institute any proceedings which the Indenture
Trustee may deem to be necessary or advisable in the premises. Without
limiting the generality of the foregoing, but subject to the rights of the
Owner Trustee and the Owner Participant hereunder, during the continuance of
any Event of Default under this Trust Indenture, the Indenture Trustee shall
have the right under such power of attorney to accept any offer in connection
with the exercise of remedies as set forth herein of any purchaser to
purchase the Airframe and Engines and upon such purchase to execute and
deliver in the name of and on behalf of the Owner Trustee an appropriate xxxx
of sale and other instruments of transfer relating to the Airframe and
Engines, when purchased by such purchaser, and to perform all other necessary
or appropriate acts with respect to any such purchase, and in its discretion
to file any claim or take any other action or proceedings, either in its own
name or in the name of the Owner Trustee or otherwise, which the Indenture
Trustee may deem necessary or appropriate to protect and preserve the right,
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title and interest of the Indenture Trustee in and to such Rents and other
sums and the security intended to be afforded hereby; provided, however, that
no action of the Indenture Trustee pursuant to this paragraph shall increase
the obligations or liabilities of the Owner Trustee to any Person beyond
those obligations and liabilities specifically set forth in this Trust
Indenture and in the other Operative Documents. Under the Lease, Lessee is
directed, so long as this Trust Indenture shall not have been fully
discharged, to make all payments of Rent (other than Excluded Payments) and
all other amounts which are required to be paid to or deposited with the
Owner Trustee pursuant to the Lease (other than Excluded Payments) directly
to, or as directed by, the Indenture Trustee at such address or addresses as
the Indenture Trustee shall specify, for application as provided in this
Trust Indenture. The Owner Trustee agrees that promptly upon receipt
thereof, it will transfer to the Indenture Trustee any and all monies from
time to time received by it constituting part of the Trust Indenture Estate,
for distribution by the Indenture Trustee pursuant to this Trust Indenture,
except that the Owner Trustee shall accept for distribution pursuant to the
Trust Agreement any amounts distributed to it by the Indenture Trustee under
this Trust Indenture.
The Owner Trustee agrees that at any time and from time to
time, upon the written request of the Indenture Trustee, the Owner Trustee
will promptly and duly execute and deliver or cause to be duly executed and
delivered any and all such further instruments and documents as the Indenture
Trustee may reasonably deem necessary or desirable to perfect, preserve or
protect the mortgage, security interests and assignments created or intended
to be created hereby or to obtain for the Indenture Trustee the full benefits
of the assignment hereunder and of the rights and powers herein granted. The
parties hereto acknowledge that neither the Owner Trustee nor the Owner
Participant shall have any obligation as to any recording, filing, refiling
or re-recording of any documents or instruments in regard to maintaining the
perfection of the security interests created hereunder, in the Trust
Indenture Estate or any security interest that may be claimed to have been
created by the Lease or the ownership interest of the Owner Trustee in the
Aircraft.
The Owner Trustee does hereby warrant and represent that it
has not assigned or pledged, and hereby covenants and agrees that it will not
assign or pledge, so long as the assignment hereunder shall remain in effect,
and the Lien hereof shall not have been released pursuant to Section 10.01
hereof, any of its right, title or interest hereby assigned, to anyone other
than the Indenture Trustee and its predecessor(s) in this transaction, and
that it will not, except as otherwise provided in this Trust Indenture and
except with respect to Excluded Payments to which it is entitled, (i) accept
any payment from Lessee under any Indenture Agreement, (ii) enter into any
agreement amending or supplementing any Indenture Agreement, (iii) execute
any waiver or modification of, or consent under, the terms of, or exercise
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any rights, powers or privileges under, any Indenture Agreement, (iv) settle
or compromise any claim (other than those relating to an Excluded Payment)
arising under any Indenture Agreement or (v) submit or consent to the
submission of any dispute, difference or other matter arising under or in
respect of any Indenture Agreement to arbitration thereunder.
The Owner Trustee does hereby further agree that it will not
without the written consent of the Indenture Trustee:
(a) collect or agree to the receipt or collection of any
payment of Rent (other than Excluded Payments),
including Basic Rent, Stipulated Loss Value,
Termination Value or any other payment to be made
pursuant to Section 9 or 10 of the Lease prior to
the date for the payment thereof provided for by the
Lease or assign, transfer or hypothecate (other than
to the Indenture Trustee hereunder) any payment of
Rent (other than Excluded Payments), including Basic
Rent, Stipulated Loss Value, Termination Value or
any other payment to be made pursuant to Section 9
or 10 of the Lease, then due or to accrue in the
future under the Lease in respect of the Airframe
and Engines; or
(b) except as contemplated by the Trust Agreement in
connection with the appointment of a successor owner
trustee, sell, mortgage, transfer, assign or
hypothecate (other than to the Indenture Trustee
hereunder) its interest in the Airframe and Engines
or any part thereof or in any amount to be received
by it from the use or disposition of the Airframe
and Engines, other than amounts distributed to it
pursuant to Article III hereof.
It is hereby further agreed that any and all property
described or referred to in the granting clauses hereof which is hereafter
acquired by the Owner Trustee shall ipso facto, and without any further
conveyance, assignment or act on the part of the Owner Trustee or the
Indenture Trustee, become and be subject to the Lien herein granted as fully
and completely as though specifically described herein, but nothing contained
in this paragraph shall be deemed to modify or change the obligations of the
Owner Trustee contained in the foregoing paragraphs.
The Owner Trustee does hereby ratify and confirm the Lease
and does hereby agree that it will not violate any covenant or agreement made
by it therein, herein or in any of the other Owner Trustee Documents.
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Notwithstanding the Granting Clause or any of the foregoing
paragraphs, there is hereby excluded from the foregoing sale, transfer,
assignment, grant, pledge and security interest all Excluded Payments.
IT IS HEREBY COVENANTED AND AGREED by and between the
parties hereto as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. For all purposes of this
Indenture the following terms shall have the following meanings (such
definitions to be equally applicable to both the singular and plural forms of
the terms defined):
"Actual Knowledge" shall mean, (i) as it applies to the
Owner Trustee or Indenture Trustee, as the case may be, actual knowledge of a
Responsible Officer in the Trust Office of the Owner Trustee or in the
Corporate Trust Office of the Indenture Trustee, as the case may be, and (ii)
as it applies to the Owner Participant, actual knowledge of a vice president
or other higher officer of the Owner Participant having responsibility for
the transactions contemplated by the Operative Documents.
"Amortization Amount" shall mean, with respect to any
Principal Amount Repayment Date, the amount set forth opposite such Date on
the Amortization Schedule.
"Amortization Schedule" shall mean the amortization schedule
for the Secured Certificates delivered pursuant to Section 2.02 hereof.
"Average Life Date" for each Secured Certificate to be
redeemed shall be the date which follows the redemption date by a period
equal to the Remaining Weighted Average Life at the redemption date of such
Secured Certificate. "Remaining Weighted Average Life" of such Secured
Certificate, at the redemption date of such Secured Certificate, shall be the
number of days equal to the quotient obtained by dividing (a) the sum of the
products obtained by multiplying (i) the amount of each then remaining
installment of principal, including the payment due on the maturity date of
such Secured Certificate, by (ii) the number of days from and including the
redemption date to but excluding the scheduled payment date of such principal
installment; by (b) the then unpaid principal amount of such Secured
Certificate.
"Cash Equivalents" shall mean the investments specified in
Section 22(a) of the Lease.
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"Certificate Holder" shall mean any holder from time to time
of one or more Secured Certificates.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Continuous Stay Period" shall have the meaning specified in
Section 4.04(a) hereof.
"Corporate Trust Department" or "Trust Office" means the
principal corporate trust office of the Owner Trustee located at 00 Xxxxx
Xxxx Xxxxxx, Xxxx Xxxx Xxxx, Xxxx 00000, 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 Lessee, the Indenture Trustee, the Owner Participant
and each Certificate Holder.
"Corporate Trust Office" shall mean the principal office of
the Indenture Trustee located at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000, 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 Lessee,
the Owner Trustee, the Loan Participants and each Certificate Holder.
"Debt" shall mean any liability for borrowed money, or any
liability for the payment of money in connection with any letter of credit
transaction, or other liabilities evidenced or to be evidenced by bonds,
debentures, notes or other similar instruments or for the deferred purchase
price of property, goods or services.
"Debt Rate" shall mean, with respect to any Series, the rate
per annum specified for such Series under the heading "Interest Rate" in
Schedule I to the Trust Indenture.
"Default" means any event or condition that with the giving
of notice or the lapse of time or both would become an Event of Default or
Lease Event of Default (excluding Lease Events of Default related to Excluded
Payments).
"Dollars" and "$" shall mean the lawful currency of the
United States of America.
"Enforcement Date" shall have meaning specified in Section
4.03 hereof.
"Event of Default" shall have the meaning specified in
Section 4.02 hereof.
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"Excess Amount" shall have the meaning specified in Section
2.03(b) hereof.
"Excluded Payments" shall mean (i) indemnity payments paid
or payable by Lessee to or in respect of the Owner Participant or the Owner
Trustee in its individual capacity, their respective Affiliates, successors
and permitted assigns and their directors, officers, employees, servants and
agents (collectively, the "Owner Indemnitees") pursuant to Sections 7(b),
7(c), 16 and 17 of the Participation Agreement, (ii) proceeds of public
liability insurance in respect of the Aircraft payable as a result of
insurance claims made, or losses suffered, by the Owner Trustee or the
Indenture Trustee in their respective individual capacities or by any of the
Owner Indemnitees, (iii) proceeds of insurance maintained with respect to the
Aircraft by the Owner Participant (whether directly or through the Owner
Trustee) or any other Owner Indemnitee and permitted under Section 11(e) of
the Lease, (iv) all payments required to be made under the Tax Indemnity
Agreement by Lessee and all payments of Supplemental Rent by Lessee in
respect of any amounts payable under the Tax Indemnity Agreement, (v) fees
payable to the Owner Trustee or the Indenture Trustee pursuant to the last
sentence of Section 7(c) of the Participation Agreement, (vi) provided that
the Secured Certificates shall have been duly assumed by Lessee pursuant to
Section 2.13 hereof, the amounts payable to the Owner Trustee pursuant to the
third sentence of Section 19(d) of the Lease plus all reasonable expenses
incurred by the Owner Trustee and the Owner Participant in connection with
such assumption, as applicable, (vii) any payment of the foregoing under the
Guarantee, (viii) interest accrued on any of the above, and (ix) any right to
enforce the payment of any amount described in clauses (i) through (viii)
above and the right to declare an Event of Default in respect of any of the
foregoing amounts.
"FSB" shall mean First Security Bank, National Association,
a national banking association.
"Government Entity" means (a) any federal, state, provincial
or similar government, and any body, board, department, commission, court,
tribunal, authority, agency or other instrumentality of any such government
or otherwise exercising any executive, legislative, judicial, administrative
or regulatory functions of such government or (b) any other government entity
having jurisdiction over any matter contemplated by the Operative Agreements
or relating to the observance or performance of the obligations of any of the
parties to the Operative Agreements.
"Guarantor" shall have the meaning specified in the Lease.
"Indenture Agreements" means the Participation Agreement,
the Lease, the Purchase Agreement, the Purchase Agreement Assignment[, the
Guaranty -- A319's only], the Consent and Agreement, the Guarantee, the Bills
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of Sale and any other contract, agreement or instrument from time to time
assigned or pledged under the Trust Indenture.
"Indenture Indemnitee" means (i) the Indenture Trustee, (ii)
the Loan Participants and each Certificate Holder, (iii) the Subordination
Agent, (iv) the Liquidity Provider and the Policy Provider, (v) the Pass
Through Trustee and (vi) the respective directors, officers, employees,
agents and servants of each of the Persons described in clauses (i) through
(v), inclusive.
"Indenture Trustee Event" means either (i) the Secured
Certificates shall have become due and payable pursuant to Section 4.04(b) of
the Trust Indenture or (ii) the Indenture Trustee has taken action or
notified the Owner Trustee that it intends to take action to foreclose the
Lien of the Trust Indenture or otherwise commence the exercise of any
significant remedy under the Trust Indenture or the Lease.
"Law" shall mean (a) any constitution, treaty, statute, law,
regulation, order, rule or directive of any Government Entity, and (b) any
judicial or administrative interpretation or application of, or decision
under, any of the foregoing.
"Lease" shall mean that certain Lease Agreement [NW ____ _],
dated as of [_______________], entered into by the Owner Trustee and Lessee
concurrently with the execution and delivery hereof, as said Lease Agreement
has been, or may from time to time be, supplemented or amended, or the terms
thereof waived or modified, to the extent permitted by, and in accordance
with, the terms of this Indenture. The term "Lease" shall also include each
Lease Supplement from time to time entered into pursuant to the terms of the
Lease.
"Lease Default" shall mean a "Default" as defined in the
Lease.
"Lease Event of Default" shall mean an "Event of Default" as
defined in the Lease.
"Lessee" shall mean Northwest Airlines, Inc., a Minnesota
corporation.
"Lessee Operative Documents" means the Participation
Agreement, the Lease, Lease Supplement No. 1, the Tax Indemnity Agreement,
the Purchase Agreement Assignment, the FAA Xxxx of Sale and the Xxxx of Sale.
"Majority in Interest of Certificate Holders" as of a
particular date of determination shall mean the holders of more than a
majority in aggregate unpaid Principal Amount of all Secured Certificates
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outstanding as of such date (excluding any Secured Certificates held by the
Owner Trustee or the Owner Participant or any interests of the Owner
Participant therein by reason of subrogation pursuant to Section 4.03 hereof
(unless all Secured Certificates then outstanding shall be held by the Owner
Trustee or the Owner Participant) or Lessee or any affiliate of any thereof).
"Make-Whole Amount" means, with respect to any Secured
Certificate, the amount (as determined by an independent investment banker
selected by Lessee and reasonably acceptable to the Indenture Trustee and the
Owner Participant) by which (a) the present value of the remaining scheduled
payments of principal and interest from the redemption date to maturity of
such Secured Certificate computed by discounting each such payment on a
semiannual basis from its respective Payment Date (assuming a 360-day year of
twelve 30-day months) using a discount rate equal to the Treasury Yield
exceeds (b) the outstanding principal amount of such Secured Certificate plus
accrued interest. For purposes of determining the Make-Whole Amount,
"Treasury Yield" at the time of determination with respect to any Secured
Certificate means the interest rate (expressed as a semiannual equivalent and
as a decimal and, in the case of United States Treasury bills, converted to a
bond equivalent yield) determined to be the per annum rate equal to the
semiannual yield to maturity for United States Treasury securities maturing
on the Average Life Date of such Secured Certificate and trading in the
public securities market either as determined by interpolation between the
most recent weekly average yield to maturity for two series of United States
Treasury securities, trading in the public securities markets, (A) one
maturing as close as possible to, but earlier than, the Average Life Date of
such Secured Certificate and (B) the other maturing as close as possible to,
but later than, the Average Life Date of such Secured Certificate, in each
case as published in the most recent H.15(519) or, if a weekly average yield
to maturity for United States Treasury securities maturing on the Average
Life Date of such Secured Certificate is reported on the most recent
H.15(519), such weekly average yield to maturity as published in such
H.15(519). "H.15(519)" means the weekly statistical release designated as
such, or any successor publication, published by the Board of Governors of
the Federal Reserve System. The date of determination of a Make-Whole Amount
shall be the third Business Day prior to the applicable redemption date and
the "most recent H.15(519)" means the H.15(519) published prior to the close
of business on the third Business Day prior to the applicable redemption
date.
"Mortgaged Property" shall have the meaning specified in
Section 3.03 hereof.
"Owner Indemnitee" shall have the meaning specified in the
definition of Excluded Payments herein.
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"Owner Participant" shall mean
[______________________________], a [____________________], so long as such
party shall have any interest in the Trust Estate, and transferees thereof as
permitted by Section 8 of the Participation Agreement.
"Participants" shall mean and include the Loan Participants
and the Owner Participant.
"Participation Agreement" shall mean that certain
Participation Agreement [NW ____ _], dated as of [_______________], among the
Owner Trustee, the Subordination Agent, the Indenture Trustee, Lessee, the
Guarantor, the Owner Participant and the Purchasers as the same may from time
to time be supplemented or further amended, or the terms thereof waived or
modified, to the extent permitted by, and in accordance with, the terms
thereof.
"Past Due Rate" shall mean, with respect to the Secured
Certificates, the rate per annum equal to 2% over the Debt Rate as in effect
from time to time.
"Payment Date" shall mean each [April 1 and October 1],
commencing on [April/October __, ____] (or, if any such day is not a Business
Day, the immediately succeeding Business Day) until the Secured Certificates
have been paid in full.
"Principal Amount" with respect to a Secured Certificate
means the stated original principal amount of such Secured Certificate and,
with respect to all Secured Certificates, means the aggregate stated original
principal amounts of all Secured Certificates.
"Principal Amount Repayment Date" shall mean each Payment
Date on which any portion of the Principal Amount is due and payable in
accordance with the Amortization Schedule.
"QIB" shall have the meaning specified in Section 2.08
hereof.
"Replacement Airframe" shall mean any airframe substituted
for the Airframe pursuant to Section 5.06 hereof.
"Replacement Engine" shall mean any engine substituted for
an Engine pursuant to Section 5.06 hereof.
"Responsible Officer" means with respect to the Owner
Trustee, a responsible officer in the Trust Office of the Owner Trustee
(including, without limitation, any authorized officer in the Trust Office of
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the Owner Trustee), and with respect to the Indenture Trustee, a responsible
officer in the Corporate Trust Office of the Indenture Trustee.
"Section 1110 Period" shall have the meaning specified in
Section 4.04(a) hereof.
"Secured Certificates" shall mean and include any Secured
Certificates issued hereunder, and issued in exchange therefor or replacement
thereof.
"Secured Obligations" shall have the meaning specified in
Section 2.06 hereof.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Senior Holder" shall have the meaning specified in Section
2.15(c) hereof.
"Series C" or "Series C Secured Certificates" means Secured
Certificates issued and designated as "Series C" hereunder, in the Principal
Amount and maturities and bearing interest as specified in Schedule I to the
Trust Indenture under the heading "Series C."
"Series G" or "Series G Secured Certificates" means Secured
Certificates issued and designated as "Series G" hereunder, in the Principal
Amount and maturities and bearing interest as specified in Schedule I to the
Trust Indenture under the heading "Series G."
"State Street" means State Street Bank and Trust Company, a
Massachusetts trust company, not in its capacity as Indenture Trustee under
the Trust Indenture, but in its individual capacity.
"Transactions" means the transactions contemplated by the
Participation Agreement and the other Operative Documents.
"Trust Agreement and Indenture Supplement" shall mean a
supplement to the Trust Agreement and to this Indenture, in substantially the
form of Exhibit A hereto, which shall particularly describe the Aircraft, and
any Replacement Airframe and Replacement Engine included in the property of
the Owner Trustee covered by the Trust Agreement.
"Trust Indenture", "this Trust Indenture", "the Trust
Indenture", "Indenture", "this Indenture", and "the Indenture" shall mean
this Trust Indenture and Security Agreement [NW ____ _] as it may from time
to time be supplemented or amended as herein provided, including
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supplementing by the Trust Agreement and Indenture Supplement pursuant
hereto.
"Trust Indenture Estate" shall mean all estate, right, title
and interest of the Indenture Trustee in and to the properties referred to in
the Granting Clause of this Trust Indenture, excluding Excluded Payments.
SECTION 1.02. Reference to Other Documents. For all
purposes of this Trust Indenture the terms used but not defined herein are
used as defined in the Lease.
ARTICLE II
THE SECURED CERTIFICATES
SECTION 2.01. Form of Secured Certificates.
The Secured Certificates shall be substantially in the form
set forth below:
THIS SECURED CERTIFICATE HAS NOT BEEN REGISTERED PURSUANT TO THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR PURSUANT TO THE
SECURITIES LAWS OF ANY STATE. ACCORDINGLY, THIS SECURED CERTIFICATE MAY NOT
BE SOLD UNLESS EITHER REGISTERED UNDER THE ACT AND SUCH APPLICABLE STATE LAWS
OR AN EXEMPTION FROM SUCH REGISTRATIONS IS AVAILABLE.
FIRST SECURITY BANK, NATIONAL ASSOCIATION, AS OWNER TRUSTEE UNDER
TRUST AGREEMENT [NW ____ _] DATED AS OF [_______________].
SERIES [___] NON-RECOURSE SECURED CERTIFICATE DUE [_____] ISSUED
IN CONNECTION WITH THE [AIRBUS A319-114] [BOEING 757-251] AIRCRAFT
BEARING UNITED STATES REGISTRATION NUMBER N[_____].
No.____ Date:[________]
$__________________
INTEREST RATE MATURITY DATE
------------- -------------
[________]
[________,_______]
FIRST SECURITY BANK, NATIONAL ASSOCIATION, not in its
individual capacity but solely as Owner Trustee (herein in such capacity
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called the "Owner Trustee") under that certain Trust Agreement [NW ____ _],
dated as of [_______________], between the Owner Participant named therein
and FSB (herein as such Trust Agreement may be supplemented or amended from
time to time called the "Trust Agreement"), hereby promises to pay to
___________, or the registered assignee thereof, the principal sum of
$_________ (the "Principal Amount"), together with interest on the amount of
the Principal Amount remaining unpaid from time to time (calculated on the
basis of a year of 360 days comprised of twelve 30-day months) from the date
hereof until paid in full at a rate per annum equal to the interest rate
indicated above. The Principal Amount of this Secured Certificate shall be
payable in installments on the dates set forth in Schedule I hereto equal to
the corresponding percentage of the Principal Amount of this Secured
Certificate set forth in Schedule I hereto. Accrued but unpaid interest
shall be due and payable in semi-annual installments commencing
[April/October 1, _____], and thereafter on [October 1] and [April 1] of each
year, to and including [____________]. Notwithstanding the foregoing, the
final payment made on this Secured Certificate shall be in an amount
sufficient to discharge in full the unpaid Principal Amount and all accrued
and unpaid interest on, and any other amounts due under, this Secured
Certificate. Notwithstanding anything to the contrary contained herein, if
any date on which a payment under this Secured Certificate becomes due and
payable is not a Business Day then such payment shall not be made on such
scheduled date but shall be made on the next succeeding Business Day and if
such payment is made on such next succeeding Business Day, no interest shall
accrue on the amount of such payment during such extension.
For purposes hereof, the term "Trust Indenture" means the
Trust Indenture and Security Agreement [NW ____ _], dated as of
[_______________], between the Owner Trustee and State Street Bank and Trust
Company (the "Indenture Trustee"), as the same may be amended or supplemented
from time to time. All other capitalized terms used in this Secured
Certificate and not defined herein shall have the respective meanings
assigned in the Trust Indenture.
This Secured Certificate shall bear interest, payable on
demand, at the Past Due Rate (calculated on the basis of a year of 360 days
comprised of twelve 30-day months) on any overdue Principal Amount, any
overdue Make-Whole Amount, if any, and (to the extent permitted by applicable
law) any overdue interest and any other amounts payable hereunder which are
overdue, in each case for the period the same is overdue. Amounts shall be
overdue if not paid when due (whether at stated maturity, by acceleration or
otherwise).
All payments of Principal Amount, interest, Make-Whole
Amount, if any, and other amounts, if any, to be made by the Owner Trustee
hereunder and under the Trust Indenture shall be payable only from the income
and proceeds from the Trust Estate to the extent included in the Trust
-00-
Xxxxxxxxx Xxxxxx and only to the extent that the Owner Trustee shall have
sufficient income or proceeds from the Trust Estate to the extent included in
the Trust Indenture Estate to enable the Indenture Trustee to make such
payments in accordance with the terms of Section 2.03 and Article III of the
Trust Indenture and each holder hereof, by its acceptance of this Secured
Certificate, agrees that it will look solely to the income and proceeds from
the Trust Indenture Estate to the extent available for distribution to the
holder hereof as above provided and that none of the Owner Participant, the
Owner Trustee or the Indenture Trustee is personally liable or liable in any
manner extending to any assets other than the Trust Indenture Estate to the
holder hereof for any amounts payable or any liability under this Secured
Certificate or, except as provided in the Trust Indenture or in the
Participation Agreement, for any liability under the Trust Indenture or the
Participation Agreement; provided, however, that nothing herein contained
shall limit, restrict or impair the right of the Indenture Trustee, subject
always to the terms and provisions of the Trust Indenture, to accelerate the
maturity of this Secured Certificate upon occurrence of an Event of Default
under the Trust Indenture in accordance with Section 4.04(b) of the Trust
Indenture, to bring suit and obtain a judgment against the Owner Trustee on
this Secured Certificate for purposes of realizing upon the Trust Indenture
Estate and to exercise all rights and remedies provided under the Trust
Indenture or otherwise realize upon the Trust Indenture Estate.
There shall be maintained a Secured Certificate Register for
the purpose of registering transfers and exchanges of Secured Certificates at
the Corporate Trust Office of the Indenture Trustee or at the office of any
successor in the manner provided in Section 2.07 of the Trust Indenture.
The Principal Amount and interest and other amounts due
hereunder shall be payable in Dollars in immediately available funds at the
Corporate Trust Office of the Indenture Trustee, or as otherwise provided in
the Trust Indenture. Each such payment shall be made on the date such
payment is due and without any presentment or surrender of this Secured
Certificate, except that in the case of any final payment with respect to
this Secured Certificate, the Secured Certificate shall be surrendered
promptly thereafter to the Indenture Trustee for cancellation.
The holder hereof, by its acceptance of this Secured
Certificate, agrees that, except as provided in the Trust Indenture, each
payment received by it hereunder shall be applied, first, to the payment of
accrued interest on this Secured Certificate (as well as any interest on any
overdue Principal Amount, any overdue Make-Whole Amount, if any, or, to the
extent permitted by Law, any overdue interest and other amounts hereunder) to
the date of such payment, second, to the payment of the Principal Amount of
this Secured Certificate then due, third, to the payment of Make-Whole
Amount, if any, and any other amount due hereunder or under the Trust
Indenture, and fourth, the balance, if any, remaining thereafter, to the
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payment of Principal Amount of this Secured Certificate remaining unpaid in
the inverse order of their normal maturity.
This Secured Certificate is one of the Secured Certificates
referred to in the Trust Indenture which have been or are to be issued by the
Owner Trustee pursuant to the terms of the Trust Indenture. The Trust
Indenture Estate is held by the Indenture Trustee as security, in part, for
the Secured Certificates. The provisions of this Secured Certificate are
subject to the Trust Indenture. Reference is hereby made to the Trust
Indenture and the Participation Agreement for a complete statement of the
rights and obligations of the holder of, and the nature and extent of the
security for, this Secured Certificate and the rights and obligations of the
holders of, and the nature and extent of the security for, any other Secured
Certificates executed and delivered under the Trust Indenture, as well as for
a statement of the terms and conditions of the trust created by the Trust
Indenture, to all of which terms and conditions in the Trust Indenture and
the Participation Agreement each holder hereof agrees by its acceptance of
this Secured Certificate.
As provided in the Trust Indenture and subject to certain
limitations therein set forth, this Secured Certificate is exchangeable for a
like aggregate Principal Amount of Secured Certificates of different
authorized denominations, as requested by the holder surrendering the same.
Prior to due presentment for registration of transfer of
this Secured Certificate, the Owner Trustee and the Indenture Trustee shall
treat the person in whose name this Secured Certificate is registered as the
owner hereof for all purposes whether or not this Secured Certificate be
overdue, and neither of the Owner Trustee nor the Indenture Trustee shall be
affected by notice to the contrary.
This Secured Certificate is subject to redemption as
provided in Sections 2.10, 2.11 and 2.12 of the Trust Indenture but not
otherwise. This Secured Certificate is also subject to assumption by Lessee
as provided in Section 2.13 of the Trust Indenture, to exchange and to
purchase by the Owner Participant or the Owner Trustee as provided in Section
2.14 of the Trust Indenture but not otherwise.
[The indebtedness evidenced by this Secured Certificate is,
to the extent and in the manner provided in the Trust Indenture, subordinate
and subject in right of payment to the prior payment in full of the Secured
Obligations (as defined in the Trust Indenture) in respect of Series G
Secured Certificates, and this Secured Certificate is issued subject to such
provisions. The Certificate Holder of this Secured Certificate, by accepting
the same, (a) agrees to and shall be bound by such provisions, (b) authorizes
and directs the Indenture Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in the
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Trust Indenture and (c) appoints the Indenture Trustee his attorney-in-fact
for such purpose.]
Unless the certificate of authentication hereon has been
executed by or on behalf of the Indenture Trustee by manual signature, this
Secured Certificate shall not be entitled to any benefit under the Trust
Indenture or be valid or obligatory for any purpose.
THIS SECURED CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
* * *
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IN WITNESS WHEREOF, the Owner Trustee has caused this
Secured Certificate to be executed in its corporate name by its officer
thereunto duly authorized on the date hereof.
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Owner Trustee
By________________________________
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Secured Certificates referred to in the
within-mentioned Trust Indenture.
STATE STREET BANK AND TRUST
COMPANY,
not in its individual capacity
but solely as Indenture Trustee
By________________________________
Name:
Title:
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SCHEDULE I
SECURED CERTIFICATES AMORTIZATION
Percentage of
Principal Amount
Payment Date to be Paid
------------ ----------------
[SEE SCHEDULE I TO TRUST INDENTURE
WHICH IS INSERTED UPON ISSUANCE]
* * *
SECTION 2.02. Issuance and Terms of Secured Certificates.
The Secured Certificates shall be dated the date of issuance
thereof, shall be issued in two separate series consisting of Series G and
Series C and in the maturities and principal amounts and shall bear interest
as specified in Schedule I hereto. On the Delivery Date, each Secured
Certificate shall be issued to the Pass Through Trustees (or their designee)
under the Pass Through Agreements as set forth in Schedule II hereto. The
Secured Certificates shall be issued in registered form only. The Secured
Certificates shall be issued in denominations of $1,000 and integral
multiples thereof, except that one Secured Certificate of each Series may be
in an amount that is not an integral multiple of $1,000.
Each Secured Certificate shall bear interest at the Debt
Rate (calculated on the basis of a year of 360 days comprised of twelve 30-
day months) on the unpaid Principal Amount thereof from time to time
outstanding, payable in arrears on [April/October 1, ____], and on each
[October 1] and [April 1] thereafter until maturity. The Principal Amount of
each Secured Certificate shall be payable on the dates and in the
installments equal to the corresponding percentage of the Principal Amount as
set forth in Schedule I hereto which shall be attached as Schedule I to the
Secured Certificates. Notwithstanding the foregoing, the final payment made
under each Secured Certificate shall be in an amount sufficient to discharge
in full the unpaid Principal Amount and all accrued and unpaid interest on,
and any other amounts due under, such Secured Certificate. Each Secured
Certificate shall bear interest at the Past Due Rate (calculated on the basis
of a year of 360 days comprised of twelve 30-day months) on any part of the
Principal Amount, Make-Whole Amount, if any, and to the extent permitted by
applicable law, interest and any other amounts payable thereunder not paid
when due for any period during which the same shall be overdue, in each case
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for the period the same is overdue. Amounts shall be overdue if not paid
when due (whether at stated maturity, by acceleration or otherwise).
Notwithstanding anything to the contrary contained herein, if any date on
which a payment under any Secured Certificate becomes due and payable is not
a Business Day then such payment shall not be made on such scheduled date but
shall be made on the next succeeding Business Day and if such payment is made
on such next succeeding Business Day, no interest shall accrue on the amount
of such payment during such extension.
The Owner Trustee agrees to pay to the Indenture Trustee for
distribution in accordance with Section 3.04 hereof (a) any and all indemnity
amounts received by the Owner Trustee which are payable by Lessee to (i) the
Indenture Trustee in its individual capacity, (ii) the Certificate Holders,
(iii) the Subordination Agent, (iv) the Liquidity Provider, or (v) the Pass
Through Trustees, in each case pursuant to Section 7 of the Participation
Agreement, (b) Owner Trustee's pro rata share of all amounts owed to the
Liquidity Provider by the Subordination Agent under each Liquidity Facility
other than amounts due as (i) repayments of the principal of advances
thereunder, (ii) interest on Interest Drawings, Final Drawings, and Applied
Downgrade Advances and Applied Non-Extension Advances (as defined in the
Liquidity Facilities) under any Liquidity Facility except to the extent
included in Net Interest and Related Charges, and (iii) fees payable to the
Liquidity Provider payable (whether or not in fact paid) under Section 7(a)
of the Note Purchase Agreement (as originally in effect or amended, with the
consent of the Owner Participant), (c) Owner Trustee's pro rata share of all
compensation and reimbursement of fees, expenses and disbursements (including
payment of indemnities) owed to the Policy Provider under the Policy Provider
Agreement other than fees payable to the Policy Provider payable (whether or
not in fact paid) under Section 7(a) of the Note Purchase Agreement (as
originally in effect or amended, with the consent of the Owner Participant),
and (d) any and all amounts received by the Owner Trustee which are payable
by Lessee under clause (c) or (d) of the definition of Supplemental Rent. As
used in this Section, "Owner Trustee's pro rata share" means as of any time:
(A) with respect to all amounts other than Net Interest
and Related Charges, a fraction the numerator of which is the
aggregate principal balance then outstanding of the Secured
Certificates and the denominator of which is the aggregate principal
balance then outstanding of all Equipment Notes, plus
(B) with respect to all Net Interest and Related Charges
(x) if there exists a Payment Default under any Secured Certificate a
fraction, the numerator of which is the aggregate principal balance then
outstanding of the Secured Certificates and the denominator of which is the
aggregate principal balance then outstanding of all Equipment Notes issued
under Indentures under which there exists a Payment Default or (y) at all
other times, zero.
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As used in this Section, "Net Interest and Related Charges" means the sum of
(i) the amount, if any, by which interest payable to the Liquidity Provider
on any Interest Drawing, Final Drawing, Applied Downgrade Advance and/or
Applied Non-Extension Advance (as defined in the Liquidity Facilities)
exceeds the amount which would be payable if such drawings bore interest at
the Designated Interest Rate plus (ii) any amounts payable under Section
3.01, Section 3.02, Section 3.03 or Section 7.07 of each Liquidity Facility
(or similar provisions of any succeeding Liquidity Facility) which result
from any Interest Drawing, Final Drawing, Applied Downgrade Advance or
Applied Non-Extension Advance (as defined in the Liquidity Facilities). As
used in this Section "Designated Interest Rate" means the weighted average
Past Due Rate (as defined in the applicable Indentures) except with respect
to that portion of any Final Drawing (or Applied Downgrade Advance or Applied
Non-Extension Advance which becomes a Final Drawing) which remains in a Cash
Collateral Account, Designated Interest Rate means the weighted average
Investment Earnings of funds in the Cash Collateral Accounts. As used in
this Section, a Payment Default when used in connection with a Secured
Certificate or Equipment Note means a default in the payment of principal
thereof or interest thereon which has not been cured other than solely
because of acceleration. The following terms are used in this Section as
defined in the Intercreditor Agreement without regard to any amendment,
modification or supplement thereto after the Closing Date: Cash Collateral
Accounts, Equipment Notes, Final Drawing, Indentures, Interest Drawing and
Investment Earnings.
The Secured Certificates shall be executed on behalf of the
Owner Trustee by its President or one of its Vice Presidents, Assistant Vice
Presidents or Assistant Secretaries or other authorized officer. Secured
Certificates bearing the signatures of individuals who were at any time the
proper officers of the Owner Trustee shall bind the Owner Trustee,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Secured Certificates
or did not hold such offices at the respective dates of such Secured
Certificates. The Owner Trustee may from time to time execute and deliver
Secured Certificates with respect to the Aircraft to the Indenture Trustee
for authentication upon original issue and such Secured Certificates shall
thereupon be authenticated and delivered by the Indenture Trustee upon the
written request of the Owner Trustee signed by a Vice President or Assistant
Vice President or other authorized officer of the Owner Trustee; provided,
however, that each such request shall specify the aggregate Principal Amount
of all Secured Certificates to be authenticated hereunder on original issue
with respect to the Aircraft. No Secured Certificate shall be secured by or
entitled to any benefit under this Trust Indenture or be valid or obligatory
for any purposes, unless there appears on such Secured Certificate a
certificate of authentication in the form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized officers
and such certificate upon any Secured Certificates shall be conclusive
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evidence, and the only evidence, that such Secured Certificate has been duly
authenticated and delivered hereunder.
SECTION 2.03. Payments from Trust Indenture Estate Only.
(a) Without impairing any of the other rights, powers,
remedies, privileges, liens or security interests of the Certificate Holders
under this Trust Indenture, each Certificate Holder, by its acceptance of a
Secured Certificate, agrees that as between it and the Owner Trustee, except
as expressly provided in this Trust Indenture, the Participation Agreement or
any other Operative Document, (i) the obligation to make all payments of the
Principal Amount of, interest on, Make-Whole Amount, if any, and all other
amounts due with respect to the Secured Certificates, and the performance by
the Owner Trustee of every obligation or covenant contained in this Trust
Indenture and in the Participation Agreement or any of the other Operative
Documents, shall be payable only from the income and proceeds from the Trust
Estate to the extent included in the Trust Indenture Estate and only to the
extent that the Owner Trustee shall have sufficient income or proceeds from
the Trust Estate to the extent included in the Trust Indenture Estate to
enable the Indenture Trustee to make such payments in accordance with the
terms of Article III hereof, and all of the statements, representations,
covenants and agreements made by the Owner Trustee (when made in such
capacity) contained in this Trust Indenture and any agreement referred to
herein other than the Trust Agreement, unless expressly otherwise stated, are
made and intended only for the purpose of binding the Trust Estate and
establishing the existence of rights and remedies which can be exercised and
enforced against the Trust Estate; therefore, anything contained in this
Trust Indenture or such other agreements to the contrary notwithstanding
(except for any express provisions or representations that the Owner Trustee
is responsible for, or is making, in its individual capacity, for which there
would be personal liability of the Owner Trustee), no recourse shall be had
with respect to this Trust Indenture or such other agreements against the
Owner Trustee in its individual capacity or against any institution or person
which becomes a successor trustee or co-trustee or any officer, director,
trustee, servant or direct or indirect parent or controlling Person or
Persons of any of them, and (ii) none of the Owner Trustee, in its individual
capacity, the Owner Participant, the Indenture Trustee and any officer,
director, trustee, servant, employee, agent or direct or indirect parent or
controlling Person or Persons of any of them shall have any personal
liability for any amounts payable, or other obligation owed, hereunder, under
the Participation Agreement or any of the other Operative Documents or under
the Secured Certificates except as expressly provided herein or in the
Participation Agreement; provided, however, that nothing contained in this
Section 2.03(a) shall be construed to limit the exercise and enforcement in
accordance with the terms of this Trust Indenture or such other agreements of
rights and remedies against the Trust Estate. These provisions are not
intended as any release or discharge of the indebtedness represented by the
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Secured Certificates and the Trust Indenture, but are intended only as a
covenant not to xxx the Owner Participant, the Owner Trustee or the Indenture
Trustee in their individual capacities, except as expressly provided herein
or in the Participation Agreement, for a deficiency with respect to such
indebtedness, the indebtedness represented by this Trust Indenture and the
Secured Certificates to remain in full force and effect as fully as though
these provisions were not contained in this Trust Indenture. The Owner
Trustee hereby acknowledges that the Certificate Holders have expressly
reserved all their rights and remedies against the Trust Indenture Estate,
including the right, in the event of a default in the payment of all or part
of the Principal Amount of, interest on, Make-Whole Amount, if any, or any
other amount due with respect to any Secured Certificate within the periods
provided for in Section 4.02(b) hereof, or upon the occurrence and
continuation of any other Event of Default under this Trust Indenture, to
foreclose upon this Trust Indenture, and/or to receive the proceeds from the
Trust Indenture Estate and otherwise to enforce any other right under this
Trust Indenture in accordance with the provisions hereof. Nothing in this
Section 2.03(a) shall (x) release the Owner Trustee or constitute a covenant
not to xxx the Owner Trustee for any breach by it of any representations,
warranties or covenants of the Owner Trustee contained in the Operative
Documents or (y) release the Owner Trustee in its individual capacity from
personal liability, or constitute a covenant not to xxx the Owner Trustee in
its individual capacity for any breach by it of any representations,
warranties or covenants of the Owner Trustee made in its individual capacity
in the Operative Documents.
(b) If (i) all or any part of the Trust Estate becomes
the property of, or the Owner Trustee or Owner Participant becomes, a debtor
subject to the reorganization provisions of the Bankruptcy Code, (ii)
pursuant to such reorganization provisions, including Section 1111(b) of the
Bankruptcy Code, the Owner Trustee (in its individual capacity) or the Owner
Participant is required, by reason of the Owner Trustee (in its individual
capacity) or the Owner Participant being held to have recourse liability to
any Certificate Holder or the Indenture Trustee, directly or indirectly
(other than the recourse liability of the Owner Trustee (in its individual
capacity), to make payment on account of any amount payable as principal,
Make-Whole Amount, if any, interest or other amounts on the Secured
Certificates or under this Indenture and (iii) any Certificate Holder or the
Indenture Trustee actually receives any Excess Amount (as hereinafter
defined) which reflects any payment by the Owner Trustee (in its individual
capacity) or the Owner Participant on account of clause (ii) above, then such
Certificate Holder or the Indenture Trustee, as the case may be, shall
promptly refund to the Owner Trustee (in its individual capacity) or the
Owner Participant (whichever shall have made such payment) such Excess
Amount.
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For purposes of this Section 2.03(b), "Excess Amount" means
the amount by which such payment exceeds the amount that would have been
received by a Certificate Holder or the Indenture Trustee if the Owner
Trustee (in its individual capacity) or the Owner Participant had not become
subject to the recourse liability referred to in clause (ii) above. Nothing
contained in this Section 2.03(b) shall prevent a Certificate Holder or the
Indenture Trustee from enforcing any personal recourse obligation (and
retaining the proceeds thereof) of the Owner Trustee (in its individual
capacity) or the Owner Participant under the Participation Agreement or this
Trust Indenture (and any exhibits or annexes hereto or thereto) or by
separate agreement or from retaining any amount paid by Owner Participant
under Section 2.14 or 4.03 hereof.
SECTION 2.04. Method of Payment.
(a) The Principal Amount of, interest on, Make-Whole
Amount, if any, and other amounts due under each Secured Certificate or
hereunder will be payable in Dollars by wire transfer of immediately
available funds not later than 12:00 noon, New York City time, on the due
date of payment to the Indenture Trustee at the Corporate Trust Office for
distribution among the Certificate Holders in the manner provided herein.
The Owner Trustee shall not have any responsibility for the distribution of
such payment to any Certificate Holder. Notwithstanding the foregoing or any
provision in any Secured Certificate to the contrary, the Indenture Trustee
will use reasonable efforts to pay or cause to be paid, if so directed in
writing by any Certificate Holder (with a copy to the Owner Trustee), all
amounts paid by the Owner Trustee hereunder and under such holder's Secured
Certificate or Secured Certificates to such holder or a nominee therefor
(including all amounts distributed pursuant to Article III of this Trust
Indenture) by transferring, or causing to be transferred, by wire transfer of
immediately available funds in Dollars, prior to 2:00 p.m., New York City
time, on the due date of payment, to an account maintained by such holder
with a bank located in the continental United States the amount to be
distributed to such holder, for credit to the account of such holder
maintained at such bank. If the Indenture Trustee shall fail to make any
such payment as provided in the immediately preceding sentence after its
receipt of funds at the place and prior to the time specified above, the
Indenture Trustee, in its individual capacity and not as trustee, agrees to
compensate such holders for loss of use of funds at the Debt Rate until such
payment is made and the Indenture Trustee shall be entitled to any interest
earned on such funds until such payment is made. Any payment made hereunder
shall be made without any presentment or surrender of any Secured
Certificate, except that, in the case of the final payment in respect of any
Secured Certificate, such Secured Certificate shall be surrendered to the
Indenture Trustee for cancellation promptly after such payment.
Notwithstanding any other provision of this Trust Indenture to the contrary,
the Indenture Trustee shall not be required to make, or cause to be made,
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wire transfers as aforesaid prior to the first Business Day on which it is
practicable for the Indenture Trustee to do so in view of the time of day
when the funds to be so transferred were received by it if such funds were
received after 12:00 noon, New York City time, at the place of payment.
Prior to the due presentment for registration of transfer of any Secured
Certificate, the Owner Trustee and the Indenture Trustee shall deem and treat
the Person in whose name any Secured Certificate is registered on the Secured
Certificate Register as the absolute owner and holder of such Secured
Certificate for the purpose of receiving payment of all amounts payable with
respect to such Secured Certificate and for all other purposes, and none of
the Owner Trustee or the Indenture Trustee shall be affected by any notice to
the contrary. So long as any signatory to the Participation Agreement or
nominee thereof shall be a registered Certificate Holder, all payments to it
shall be made to the account of such Certificate Holder specified in Schedule
I thereto and otherwise in the manner provided in or pursuant to the
Participation Agreement unless it shall have specified some other account or
manner of payment by notice to the Indenture Trustee consistent with this
Section 2.04.
(b) The Indenture Trustee, as agent for the Owner
Trustee, shall exclude and withhold at the appropriate rate from each payment
of Principal Amount of, interest on, Make-Whole Amount, if any, and other
amounts due hereunder or under each Secured Certificate (and such exclusion
and withholding shall constitute payment in respect of such Secured
Certificate) any and all United States withholding taxes applicable thereto
as required by Law. The Indenture Trustee agrees to act as such withholding
agent and, in connection therewith, whenever any present or future United
States taxes or similar charges are required to be withheld with respect to
any amounts payable hereunder or in respect of the Secured Certificates, to
withhold such amounts (and such withholding shall constitute payment in
respect of such Secured Certificate) and timely pay the same to the
appropriate authority in the name of and on behalf of the Certificate
Holders, that it will file any necessary United States withholding tax
returns or statements when due, and that as promptly as possible after the
payment thereof it will deliver to each Certificate Holder (with a copy to
the Owner Trustee and Lessee) appropriate receipts showing the payment
thereof, together with such additional documentary evidence as any such
Certificate Holder may reasonably request from time to time.
If a Certificate Holder which is a Non-U.S. Person has
furnished to the Indenture Trustee a properly completed and currently
effective U.S. Internal Revenue Service Form 1001 or W-8 (or such successor
form or forms as may be required by the United States Treasury Department)
during the calendar year in which the payment hereunder or under the Secured
Certificate(s) held by such holder is made (but prior to the making of such
payment), or in either of the two preceding calendar years, and has not
notified the Indenture Trustee of the withdrawal or inaccuracy of such form
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prior to the date of such payment (and the Indenture Trustee has no reason to
know that any information set forth in such form is inaccurate), the
Indenture Trustee shall withhold only the amount, if any, required by Law
(after taking into account any applicable exemptions claimed by the
Certificate Holder) to be withheld from payments hereunder or under the
Secured Certificates held by such holder in respect of United States federal
income tax (and such withholding shall constitute payment in respect of such
Secured Certificate). If a Certificate Holder (x) which is a Non-U.S.
Person has furnished to the Indenture Trustee a properly completed and
currently effective U.S. Internal Revenue Service Form 4224 in duplicate (or
such successor certificate, form or forms as may be required by the United
States Treasury Department as necessary in order to avoid withholding of
United States federal income tax), during the calendar year in which the
payment is made (but prior to the making of such payment), and has not
notified the Indenture Trustee of the withdrawal or inaccuracy of such
certificate or form prior to the date of such payment (and the Indenture
Trustee has no reason to know that any information set forth in such form is
inaccurate) or (y) which is a U.S. Person has furnished to the Indenture
Trustee a properly completed and currently effective U.S. Internal Revenue
Service Form W-9, if applicable, prior to a payment hereunder or under the
Secured Certificates held by such holder, no amount shall be withheld from
payments in respect of United States federal income tax. If any Certificate
Holder has notified the Indenture Trustee that any of the foregoing forms or
certificates is withdrawn or inaccurate, or if such holder has not filed a
form claiming an exemption from United States withholding tax or if the Code
or the regulations thereunder or the administrative interpretation thereof
are at any time after the date hereof amended to require such withholding of
United States federal income taxes from payments under the Secured
Certificates held by such holder, the Indenture Trustee agrees to withhold
from each payment due to the relevant Certificate Holder withholding taxes at
the appropriate rate under Law and will, on a timely basis as more fully
provided above, deposit such amounts with an authorized depository and make
such returns, statements, receipts and other documentary evidence in
connection therewith as required by applicable law.
Neither the Owner Participant nor the Owner Trustee shall be
liable for the failure of the Indenture Trustee to withhold taxes in the
manner provided for herein or if any Certificate Holder provides false or
inaccurate information on any form required to be delivered under this
Section 2.04.
SECTION 2.05. Application of Payments.
In the case of each Secured Certificate, each payment of
Principal Amount, Make-Whole Amount, if any, and interest or other amounts
due thereon shall be applied:
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First: to the payment of accrued interest on such Secured
Certificate (as well as any interest on any overdue Principal Amount,
any overdue Make-Whole Amount, if any, and to the extent permitted by
Law, any overdue interest and any other overdue amounts thereunder)
to the date of such payment;
Second: to the payment of the Principal Amount of such
Secured Certificate (or a portion thereof) then due thereunder;
Third: to the payment of Make-Whole Amount, if any, and any
other amount due hereunder or under such Secured Certificate; and
Fourth: the balance, if any, remaining thereafter, to the
payment of the Principal Amount of such Secured Certificate remaining
unpaid (provided that such Secured Certificate shall not be subject
to redemption except as provided in Sections 2.10, 2.11 and 2.12
hereof).
The amounts paid pursuant to clause "Fourth" above shall be applied to the
installments of Principal Amount of such Secured Certificate in the inverse
order of their normal maturity.
SECTION 2.06. Termination of Interest in Trust Indenture
Estate.
A Certificate Holder shall not, as such, have any further
interest in, or other right with respect to, the Trust Indenture Estate when
and if the Principal Amount of, Make-Whole Amount, if any, and interest on
and other amounts due under all Secured Certificates held by such Certificate
Holder and all other sums then payable to such Certificate Holder hereunder
and under the other Operative Documents by the Owner Trustee (collectively,
the "Secured Obligations") shall have been paid in full.
SECTION 2.07. Registration, Transfer and Exchange of
Secured Certificates.
The Indenture Trustee shall keep a register (the "Secured
Certificate Register") in which the Indenture Trustee shall provide for the
registration of Secured Certificates and the registration of transfers of
Secured Certificates. No such transfer shall be given effect unless and
until registration hereunder shall have occurred. The Secured Certificate
Register shall be kept at the Corporate Trust Office of the Indenture
Trustee. The Indenture Trustee is hereby appointed "Secured Certificate
Registrar" for the purpose of registering Secured Certificates and transfers
of Secured Certificates as herein provided. A holder of any Secured
Certificate intending to exchange such Secured Certificate shall surrender
such Secured Certificate to the Indenture Trustee at the Corporate Trust
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Office, together with a written request from the registered holder thereof
for the issuance of a new Secured Certificate, specifying, in the case of a
surrender for transfer, the name and address of the new holder or holders.
Upon surrender for registration of transfer of any Secured Certificate, the
Owner Trustee shall execute, and the Indenture Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Secured Certificates of a like aggregate Principal Amount and of the same
series. At the option of the Certificate Holder, Secured Certificates may be
exchanged for other Secured Certificates of any authorized denominations of a
like aggregate Principal Amount, upon surrender of the Secured Certificates
to be exchanged to the Indenture Trustee at the Corporate Trust Office.
Whenever any Secured Certificates are so surrendered for exchange, the Owner
Trustee shall execute, and the Indenture Trustee shall authenticate and
deliver, the Secured Certificates which the Certificate Holder making the
exchange is entitled to receive. All Secured Certificates issued upon any
registration of transfer or exchange of Secured Certificates (whether under
this Section 2.07 or under Section 2.08 hereof or otherwise under this Trust
Indenture) shall be the valid obligations of the Owner Trustee evidencing the
same respective obligations, and entitled to the same security and benefits
under this Trust Indenture, as the Secured Certificates surrendered upon such
registration of transfer or exchange. Every Secured Certificate presented or
surrendered for registration of transfer, shall (if so required by the
Indenture Trustee) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by the Certificate Holder or such holder's attorney duly authorized
in writing, and the Indenture Trustee shall require evidence satisfactory to
it as to the compliance of any such transfer with the Securities Act, and the
securities Laws of any applicable state. The Indenture Trustee shall make a
notation on each new Secured Certificate of the amount of all payments of
Principal Amount previously made on the old Secured Certificate or Secured
Certificates with respect to which such new Secured Certificate is issued and
the date to which interest on such old Secured Certificate or Secured
Certificates has been paid. Interest shall be deemed to have been paid on
such new Secured Certificate to the date on which interest shall have been
paid on such old Secured Certificate, and all payments of the Principal
Amount marked on such new Secured Certificate, as provided above, shall be
deemed to have been made thereon. The Owner Trustee shall not be required to
exchange any surrendered Secured Certificates as provided above during the
ten-day period preceding the due date of any payment on such Secured
Certificate. The Owner Trustee shall in all cases deem the Person in whose
name any Secured Certificate shall have been issued and registered as the
absolute owner and holder of such Secured Certificate for the purpose of
receiving payment of all amounts payable by the Owner Trustee with respect to
such Secured Certificate and for all purposes until a notice stating
otherwise is received from the Indenture Trustee and such change is reflected
on the Secured Certificate Register. The Indenture Trustee will promptly
notify the Owner Trustee, the Owner Participant and Lessee of each
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registration of a transfer of a Secured Certificate. Any such transferee of
a Secured Certificate, by its acceptance of a Secured Certificate, agrees to
the provisions of the Participation Agreement applicable to Certificate
Holders, including Sections 6, 8(c), 8(e), 8(k), 8(l), 8(q), 8(r), 8(t),
8(cc), 10, 13(b), 13(c), 15(b) and 15(c), and shall be deemed to have
represented and warranted (except as provided above), and covenanted, to the
parties to the Participation Agreement as to the matters represented,
warranted and covenanted by the Purchasers in the Participation Agreement.
Subject to compliance by the Certificate Holder and its transferee (if any)
of the requirements set forth in this Section 2.07, the Indenture Trustee and
the Owner Trustee shall use all reasonable efforts to issue new Secured
Certificates upon transfer or exchange within 10 Business Days of the date a
Secured Certificate is surrendered for transfer or exchange.
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Secured
Certificates.
If any Secured Certificate shall become mutilated,
destroyed, lost or stolen, the Owner Trustee shall, upon the written request
of the holder of such Secured Certificate, execute and the Indenture Trustee
shall authenticate and deliver in replacement thereof a new Secured
Certificate, payable in the same Principal Amount dated the same date and
captioned as issued in connection with the Aircraft. If the Secured
Certificate being replaced has become mutilated, such Secured Certificate
shall be surrendered to the Indenture Trustee and a photocopy thereof shall
be furnished to the Owner Trustee. If the Secured Certificate being replaced
has been destroyed, lost or stolen, the holder of such Secured Certificate
shall furnish to the Owner Trustee, the Owner Participant and the Indenture
Trustee such security or indemnity as may be required by them to save the
Owner Trustee, the Owner Participant and the Indenture Trustee harmless and
evidence satisfactory to the Owner Trustee, the Owner Participant and the
Indenture Trustee of the destruction, loss or theft of such Secured
Certificate and of the ownership thereof. If a "qualified institutional
buyer" of the type referred to in paragraph (a)(l)(i)(A), (B), (D) or (E) of
Rule 144A under the Securities Act (a "QIB") is the holder of any such
destroyed, lost or stolen Secured Certificate, then the written indemnity of
such QIB, signed by an authorized officer thereof, in favor of, delivered to
and in form reasonably satisfactory to Lessee, the Owner Participant, the
Owner Trustee and the Indenture Trustee shall be accepted as satisfactory
indemnity and security and no further indemnity or security shall be required
as a condition to the execution and delivery of such new Secured Certificate.
Subject to compliance by the Certificate Holder of the requirements set forth
in this Section 2.08, the Indenture Trustee and the Owner Trustee shall use
all reasonable efforts to issue new Secured Certificates within 10 Business
Days of the date of the written request therefor from the Certificate Holder.
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SECTION 2.09. Payment of Expenses on Transfer;
Cancellation.
(a) No service charge shall be made to a Certificate
Holder for any registration of transfer or exchange of Secured Certificates,
but the Indenture Trustee, as Secured Certificate Registrar, may require
payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any registration of transfer or
exchange of Secured Certificates.
(b) The Indenture Trustee shall cancel all Secured
Certificates surrendered for replacement, redemption, transfer, exchange,
payment or cancellation and shall destroy the canceled Secured Certificates.
SECTION 2.10. Mandatory Redemptions of Secured
Certificates.
(a) On the date on which Lessee is required pursuant to
Section 10(a)(i) of the Lease to make payment for an Event of Loss with
respect to the Aircraft, all of the Secured Certificates shall be redeemed in
whole at a redemption price equal to 100% of the unpaid Principal Amount
thereof, together with all accrued interest thereon to the date of redemption
and all other amounts payable hereunder or under the Participation Agreement
to the Certificate Holders but without Make-Whole Amount.
(b) If the Lease is terminated with respect to the
Aircraft by Lessee pursuant to Section 9 or Section 19(d) thereof and Lessee
shall not have assumed all of the obligations of the Owner Trustee hereunder
pursuant to Section 2.13 and to Section 8(x) of the Participation Agreement,
on the date the Lease is so terminated all the Secured Certificates shall be
redeemed in whole at a redemption price equal to 100% of the unpaid Principal
Amount thereof, together with accrued interest thereon to the date of
redemption and all other amounts payable hereunder or under the Participation
Agreement to the Certificate Holders plus Make-Whole Amount, if any.
SECTION 2.11. Voluntary Redemptions of Secured
Certificates.
Any or all of the Secured Certificates may be redeemed by
the Owner Trustee in connection with a transaction described in, and subject
to the terms and conditions of, Section 17 of the Participation Agreement
upon at least 30 days' revocable prior written notice to the Indenture
Trustee and the Certificate Holders, and the Secured Certificates shall, as
provided in Section 17 of the Participation Agreement, be redeemed in whole
at a redemption price equal to 100% of the unpaid Principal Amount thereof,
together with accrued interest thereon to the date of redemption and all
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other amounts payable hereunder or under the Participation Agreement to the
Certificate Holders plus Make-Whole Amount, if any.
SECTION 2.12. Redemptions; Notice of Redemption.
(a) Neither any redemption of any Secured Certificate
nor any purchase by the Owner Trustee of any Secured Certificate may be made
except to the extent and in the manner expressly permitted by this Trust
Indenture. No purchase of any Secured Certificate may be made by the
Indenture Trustee.
(b) Notice of redemption or purchase with respect to the
Secured Certificates shall be given by the Indenture Trustee by first-class
mail, postage prepaid, mailed not less than 15 nor more than 60 days prior to
the applicable redemption date, to each Certificate Holder of such Secured
Certificates to be redeemed or purchased, at such Certificate Holder's
address appearing in the Secured Certificate Register; provided that, in the
case of a redemption to be made pursuant to Section 2.10(b) or Section 2.11,
such notice shall be revocable and shall be deemed revoked in the event that
the Lease does not in fact terminate on the specified termination date or if
notice of such redemption shall have been given in connection with a
refinancing of Secured Certificates and the Indenture Trustee receives
written notice of such revocation from Lessee or the Owner Trustee not later
than three days prior to the redemption date. All notices of redemption
shall state: (1) the redemption date, (2) the applicable basis for
determining the redemption price, (3) that on the redemption date, the
redemption price will become due and payable upon each such Secured
Certificate, and that, if any such Secured Certificates are then outstanding,
interest on such Secured Certificates shall cease to accrue on and after such
redemption date, and (4) the place or places where such Secured Certificates
are to be surrendered for payment of the redemption price.
(c) On or before the redemption date, the Owner Trustee
(or any person on behalf of the Owner Trustee) shall, to the extent an amount
equal to the redemption price for the Secured Certificates to be redeemed or
purchased on the redemption date shall not then be held in the Trust
Indenture Estate, deposit or cause to be deposited with the Indenture Trustee
by 12:00 noon on the redemption date in immediately available funds the
redemption price of the Secured Certificates to be redeemed or purchased.
(d) Notice of redemption or purchase having been given
as aforesaid (and not deemed revoked as contemplated in the proviso to
Section 2.12(b)), the Secured Certificates to be redeemed or purchased shall,
on the redemption date, become due and payable at the Corporate Trust Office
of the Indenture Trustee or at any office or agency maintained for such
purposes pursuant to Section 2.07, and from and after such redemption date
(unless there shall be a default in the payment of the redemption price) any
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such Secured Certificates then outstanding shall cease to bear interest.
Upon surrender of any such Secured Certificate for redemption or purchase in
accordance with said notice, such Secured Certificate shall be redeemed at
the redemption price. If any Secured Certificate called for redemption or
purchase shall not be so paid upon surrender thereof for redemption, the
principal amount thereof shall, until paid, continue to bear interest from
the applicable redemption date at the interest rate in effect for such
Secured Certificate as of such redemption date.
SECTION 2.13. Assumption of Secured Certificates by Lessee.
If, in accordance with Section 8(x) of the Participation
Agreement, and subject to the provisions of Section 8(o) thereof, Lessee
shall assume (on a full recourse basis) all of the obligations of the Owner
Trustee hereunder, under the Secured Certificates and all other Operative
Documents by supplemental indenture satisfactory to the Indenture Trustee
(which shall contain (i) the provisions substantially similar to Sections 6,
7, 8, 10, 11 and 12 of the Lease and (ii) other provisions necessary or
advisable to effectuate such assumption), then upon delivery of such
supplemental indenture, payment by Lessee of all expenses (including
reasonable fees and expenses of counsel) for the Owner Trustee and the Owner
Participant, delivery by the Guarantor of a guarantee of the Secured
Certificates and other amounts owing to the Certificate Holders substantially
in the form of the Guarantee, and delivery of an opinion of counsel for
Lessee that such assumption has been duly and validly effected, the Owner
Trustee shall be released and discharged from any further obligations
hereunder and under the Secured Certificates and all other Operative
Documents and the Owner Participant shall be released and discharged from any
further obligations under the Participation Agreement and any other Operative
Document to which it is a party, except with respect to any such obligations
that accrued prior thereto.
SECTION 2.14. Option to Purchase Secured Certificates.
Either the Owner Trustee or the Owner Participant may, upon
the events and subject to the terms and conditions and for the price set
forth in this Section 2.14, purchase all but not less than all of the Secured
Certificates outstanding hereunder, and each Certificate Holder agrees that
it will, upon such events and subject to such terms and conditions and upon
receipt of such price, sell, assign, transfer and convey to such purchaser or
its nominee (without recourse or warranty of any kind except as to its title
to the Secured Certificates and except against Liens on such Secured
Certificates arising by, through or under such holder), all of the right,
title and interest of such Certificate Holder in and to the Trust Indenture
Estate, this Trust Indenture and the Secured Certificates held by it, and
such purchaser or its nominee shall assume all of such holder's obligations
under the Participation Agreement and hereunder.
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Such option to purchase the Secured Certificates may be
exercised by the Owner Trustee or the Owner Participant upon any of the
following events, and, in any such event, the purchase price thereof shall
equal for each Secured Certificate the aggregate unpaid Principal Amount
thereof, plus accrued and unpaid interest thereon to the date of purchase and
all other amounts (other than the Make-Whole Amount, except as provided in
the next sentence) then payable hereunder or under the Participation
Agreement to the holder thereof. Such option to purchase the Secured
Certificates may be exercised: (i) upon an Indenture Trustee Event or (ii)
in the event there shall have occurred and be continuing a Lease Event of
Default, provided that if such option is exercised pursuant to this clause
(ii) at a time when there shall have occurred and be continuing for less than
180 days a Lease Event of Default, the purchase price thereof shall equal the
price provided in the preceding sentence plus the Make-Whole Amount, if any.
Such option to purchase the Secured Certificates may be
exercised by the Owner Trustee or the Owner Participant giving written notice
of its election of such option to the Indenture Trustee, which notice shall
specify a date for such purchase not more than thirty (30) days or less than
fifteen (15) days after the date of such notice. The Indenture Trustee shall
not exercise any of the remedies hereunder or, without the consent of the
Owner Trustee or the Owner Participant, under the Lease, during the period
from the time that a notice of exercise by the Owner Participant of such
option to purchase becomes irrevocable until the date on which such purchase
is required to occur pursuant to the terms of the preceding sentence. Such
election to purchase the Secured Certificates shall become irrevocable upon
the sixteenth day preceding the date specified in the written notice
described in the first sentence of this paragraph.
If the Owner Trustee or the Owner Participant on or before
the date of such purchase shall so request, the Certificate Holders will
comply with all the provisions of Section 2.07 to enable new Secured
Certificates to be issued to the Owner Trustee or the Owner Participant or
its nominee in such denominations as the Owner Trustee or the Owner
Participant shall request. All taxes, charges and expenses required pursuant
to Section 2.09 in connection with the issuance of such new Secured
Certificate shall be borne by the Owner Participant.
SECTION 2.15. Subordination.
(a) The Owner Trustee and, by acceptance of its Secured
Certificates of any Series, each Certificate Holder of such Series, hereby
agree that no payment or distribution shall be made on or in respect of the
Secured Obligations owed to such Certificate Holder of such Series, including
any payment or distribution of cash, property or securities after the
commencement of a proceeding of the type referred to in Section 4.02(g)
hereof, except as expressly provided in Article III hereof.
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(b) By the acceptance of its Secured Certificates, each
Certificate Holder of Series C agrees that in the event that such Certificate
Holder, in its capacity as a Certificate Holder, shall receive any payment or
distribution on any Secured Obligations in respect of such Series C which it
is not entitled to receive under this Section 2.15 or Article III hereof, it
will hold any amount so received in trust for the Senior Holder (as defined
in Section 2.15(c) hereof) and will forthwith turn over such payment to the
Indenture Trustee in the form received to be applied as provided in Article
III hereof.
(c) As used in this Section 2.15, the term "Senior
Holder" shall mean the Certificate Holders of Series G until the Secured
Obligations in respect of Series G Secured Certificates have been paid in
full.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Basic Rent Distribution.
Except as otherwise provided in Section 3.03 hereof, each
installment of Basic Rent, any payment of interest on overdue installments of
Basic Rent and any payment received by the Indenture Trustee pursuant to
Section 4.03 hereof shall be promptly distributed in the following order of
priority:
First, (i) so much of such installment or payment as shall be
required to pay in full the aggregate amount of the
payment or payments of Principal Amount and interest
and other amounts (as well as any interest on any
overdue Principal Amount and, to the extent
permitted by applicable law, on any overdue interest
and any other overdue amounts) then due under all
Series G Secured Certificates shall be distributed
to the Certificate Holders of Series G ratably,
without priority of one over the other, in the
proportion that the amount of such payment or
payments then due under each Series G Secured
Certificate bears to the aggregate amount of the
payments then due under all Series G Secured
Certificates; and
(ii) after giving effect to paragraph (i) above, so much
of such installment or payment remaining as shall be
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required to pay in full the aggregate amount of the
payment or payments of Principal Amount and interest
and other amounts (as well as any interest on any
overdue Principal Amount and, to the extent
permitted by applicable law, on any overdue interest
and any other overdue amounts) then due under all
Series C Secured Certificates shall be distributed
to the Certificate Holders of Series C ratably,
without priority of one over the other, in the
proportion that the amount of such payment or
payments then due under each Series C Secured
Certificate bears to the aggregate amount of the
payments then due under all Series C Secured
Certificates; and
Second, the balance, if any, of such installment remaining thereafter shall
be distributed to the Owner Trustee; provided, however, that if an
Event of Default shall have occurred and be continuing, then such
balance shall not be distributed as provided in this clause "Second"
but shall be held by the Indenture Trustee as part of the Trust
Indenture Estate and invested in accordance with Section 5.09 hereof
until whichever of the following shall first occur: (i) all Events
of Default shall have been cured or waived, in which event such
balance shall be distributed as provided in this clause "Second"
without reference to this proviso, (ii) Section 3.03 hereof shall be
applicable, in which event such balance shall be distributed in
accordance with the provisions of such Section 3.03, or (iii) the
120th day after the receipt of such payment in which case such
payment shall be distributed as provided in this clause "Second"
without reference to this proviso.
SECTION 3.02. Event of Loss; Replacement; Voluntary
Termination; Refinancing.
Except as otherwise provided in Section 3.03 hereof, any
payments received by the Indenture Trustee (i) with respect to the Aircraft
as the result of an Event of Loss, (ii) pursuant to a voluntary termination
of the Lease pursuant to Section 9 or 19(d) thereof, or (iii) in connection
with a refinancing of the Secured Certificates pursuant to Section 17 of the
Participation Agreement shall be applied to redemption of the Secured
Certificates and to all other amounts payable hereunder or to the Indenture
Trustee or any Certificate Holder under the Participation Agreement by
applying such funds in the following order of priority:
First, (a) to reimburse the Indenture Trustee and the
Certificate Holders for any reasonable costs or expenses
incurred in connection with such redemption for which they
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are entitled to reimbursement, or indemnity by Lessee, under
the Operative Documents and then (b) to pay any other
amounts then due to the Indenture Trustee and the
Certificate Holders under this Trust Indenture, the
Participation Agreement or the Secured Certificates (other
than amounts specified in clause Second below);
Second, (i) to pay the amounts specified in paragraph (i) of
clause "Third" of Section 3.03 hereof plus
Make-Whole Amount, if any, then due and payable in
respect of the Series G Secured Certificates; and
(ii) after giving effect to paragraph (i) above, to pay
the amounts specified in paragraph (ii) of clause
"Third" of Section 3.03 hereof plus Make-Whole
Amount, if any, then due and payable in respect of
the Series C Secured Certificates; and
Third, as provided in clause "Fourth" of Section 3.03 hereof;
provided, however, that if a Replacement Airframe or Replacement Engine shall
be substituted for the Airframe or Engine subject to such Event of Loss as
provided in Section 10 of the Lease and in accordance with Section 5.06
hereof, any insurance, condemnation or similar proceeds which result from
such Event of Loss and are paid over to the Indenture Trustee shall be held
by the Indenture Trustee as permitted by Section 6.04 hereof (provided that
such moneys shall be invested as provided in Section 5.09 hereof) as
additional security for the obligations of Lessee under the Lessee Operative
Documents and, unless otherwise applied pursuant to the Lease, such proceeds
(and such investment earnings) shall be released to Lessee at Lessee's
written request upon the release of such damaged Airframe or Engine and the
replacement thereof as provided in the Lease.
SECTION 3.03. Payments After Event of Default.
Except as otherwise provided in Section 3.04 hereof, all
payments received and amounts held or realized by the Indenture Trustee
(including any amounts realized by the Indenture Trustee from the exercise of
any remedies pursuant to Section 15 of the Lease or Article IV hereof) after
both an Event of Default shall have occurred and be continuing and the
Secured Certificates shall have become due and payable pursuant to Section
4.04(b) hereof, as well as all payments or amounts then held by the Indenture
Trustee as part of the Trust Indenture Estate, shall be promptly distributed
by the Indenture Trustee in the following order of priority:
First, so much of such payments or amounts as shall be required to
reimburse the Indenture Trustee for any tax, expense or
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other loss (including, without limitation, all amounts to be
expended at the expense of, or charged upon the tolls,
rents, revenues, issues, products and profits of, the
property included in the Trust Indenture Estate (all such
property being herein called the "Mortgaged Property")
pursuant to Section 4.05(b) hereof) incurred by the
Indenture Trustee (to the extent not previously reimbursed),
the expenses of any sale, taking or other proceeding,
reasonable attorneys' fees and expenses, court costs, and
any other expenditures incurred or expenditures or advances
made by the Indenture Trustee or the Certificate Holders in
the protection, exercise or enforcement of any right, power
or remedy or any damages sustained by the Indenture Trustee
or any Certificate Holder, liquidated or otherwise, upon
such Event of Default shall be applied by the Indenture
Trustee as between itself and the Certificate Holders in
reimbursement of such expenses and any other expenses for
which the Indenture Trustee or the Certificate Holders are
entitled to reimbursement under any Operative Document and
in the case the aggregate amount to be so distributed is
insufficient to pay as aforesaid, then ratably, without
priority of one over the other, in proportion to the amounts
owed each hereunder;
Second, so much of such payments or amounts remaining as shall be
required to reimburse the then existing or prior Certificate
Holders for payments made pursuant to Section 5.03 hereof
(to the extent not previously reimbursed) shall be
distributed to such then existing or prior Certificate
Holders ratably, without priority of one over the other, in
accordance with the amount of the payment or payments made
by each such then existing or prior Certificate Holder
pursuant to said Section 5.03 hereof;
Third, (i) so much of such payments or amounts remaining as
shall be required to pay in full the aggregate
unpaid Principal Amount of all Series G Secured
Certificates, and the accrued but unpaid interest
and other amounts due thereon and all other Secured
Obligations in respect of the Series G Secured
Certificates to the date of distribution, shall be
distributed to the Certificate Holders of Series G,
and in case the aggregate amount so to be
distributed shall be insufficient to pay in full as
aforesaid, then ratably, without priority of one
over the other, in the proportion that the aggregate
unpaid Principal Amount of all Series G Secured
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Certificates held by each holder plus the accrued
but unpaid interest and other amounts due hereunder
or thereunder to the date of distribution, bears to
the aggregate unpaid Principal Amount of all Series
G Secured Certificates held by all such holders plus
the accrued but unpaid interest and other amounts
due thereon to the date of distribution; and
(ii) after giving effect to paragraph (i) above, so much
of such payments or amounts remaining as shall be
required to pay in full the aggregate unpaid
Principal Amount of all Series C Secured
Certificates, and the accrued but unpaid interest
and other amounts due thereon and all other Secured
Obligations in respect of the Series C Secured
Certificates to the date of distribution, shall be
distributed to the Certificate Holders of Series C,
and in case the aggregate amount so to be
distributed shall be insufficient to pay in full as
aforesaid, then ratably, without priority of one
over the other, in the proportion that the aggregate
unpaid Principal Amount of all Series C Secured
Certificates held by each holder plus the accrued
but unpaid interest and other amounts due hereunder
or thereunder to the date of distribution, bears to
the aggregate unpaid Principal Amount of all Series
C Secured Certificates held by all such holders plus
the accrued but unpaid interest and other amounts
due thereon to the date of distribution; and
Fourth, the balance, if any, of such payments or amounts remaining
thereafter shall be distributed to the Owner Trustee.
No Make-Whole Amount shall be due and payable on the Secured
Certificates as a consequence of the acceleration of the Secured
Certificates.
SECTION 3.04. Certain Payments.
(a) Any payments received by the Indenture Trustee for
which no provision as to the application thereof is made in this Trust
Indenture and for which such provision is made in the Lease, the
Participation Agreement or any other Operative Document shall be applied
forthwith to the purpose for which such payment was made in accordance with
the terms of the Lease, the Participation Agreement or such other Operative
Document, as the case may be.
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(b) The Indenture Trustee will distribute promptly upon
receipt any indemnity payment received by it from the Owner Trustee or Lessee
in respect of the Indenture Trustee in its individual capacity, any
Certificate Holder or any other Indenture Indemnitee, in each case whether
pursuant to Section 7 of the Participation Agreement or as Supplemental Rent,
directly to the Person entitled thereto. Any payment received by the
Indenture Trustee under clause (b) of the third paragraph of Section 2.02
shall be distributed to the Subordination Agent to be distributed in
accordance with the terms of the Intercreditor Agreement, and any payment
received by the Indenture Trustee under clause (c) of the third paragraph of
Section 2.02 shall be distributed directly to the Persons entitled thereto.
(c) [Intentionally Omitted]
(d) Notwithstanding anything to the contrary contained
in this Article III, any amounts received by the Indenture Trustee which
constitute Excluded Payments shall be distributed promptly upon receipt by
the Indenture Trustee directly to the Person or Persons entitled thereto.
(e) Notwithstanding any provision of this Trust
Indenture to the contrary, any amounts held by the Indenture Trustee that
would, but for the provisions of Section 3.03 hereof, otherwise be
distributed to Lessee shall, notwithstanding the provisions of said Section,
be distributed to Lessee unless and until a Lease Event of Default shall have
occurred and be continuing.
SECTION 3.05. Other Payments.
Any payments received by the Indenture Trustee for which no
provision as to the application thereof is made in the Lease, the
Participation Agreement, elsewhere in this Trust Indenture or in any other
Operative Document shall be distributed by the Indenture Trustee to the
extent received or realized at any time (i) prior to the payment in full of
all Secured Obligations due the Certificate Holders, in the order of priority
specified in Section 3.01 hereof subject to the proviso thereto, and (ii)
after payment in full of all Secured Obligations due the Certificate Holders,
in the following order of priority:
First, to the extent payments or amounts described in clause
"First" of Section 3.03 hereof are otherwise obligations of
Lessee under the Operative Documents or for which Lessee is
obligated to indemnify against thereunder, in the manner
provided in clause "First" of Section 3.03 hereof, and
Second, in the manner provided in clause "Fourth" of Section 3.03
hereof.
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Further, and except as otherwise provided in Sections 3.02,
3.03 and 3.04 hereof, all payments received and amounts
realized by the Indenture Trustee under the Lease or
otherwise with respect to the Aircraft (including, without
limitation, all amounts realized upon the sale or release of
the Aircraft after the termination of the Lease with respect
thereto), to the extent received or realized at any time
after payment in full of all Secured Obligations due the
Certificate Holders, shall be distributed by the Indenture
Trustee in the order of priority specified in clause (ii) of
the immediately preceding sentence of this Section 3.05.
SECTION 3.06. Payments to the Owner Trustee.
Any amounts distributed hereunder by the Indenture Trustee
to the Owner Trustee shall be paid to the Owner Trustee (within the time
limits contemplated by Section 2.04(a)) by wire transfer of funds of the type
received by the Indenture Trustee at such office and to such account or
accounts of such entity or entities as shall be designated by notice from the
Owner Trustee to the Indenture Trustee from time to time. The Owner Trustee
hereby notifies the Indenture Trustee that unless and until the Indenture
Trustee receives notice to the contrary from the Owner Trustee, all amounts
to be distributed to the Owner Trustee pursuant to clause "Second" of Section
3.01 hereof shall be distributed by wire transfer of funds of the type
received by the Indenture Trustee to the Owner Participant's account (within
the time limits contemplated by Section 2.04(a)) specified in Schedule I to
the Participation Agreement.
SECTION 3.07. Application of Payments Under Guarantee.
All payments received by the Indenture Trustee pursuant to
the Guarantee shall be distributed forthwith by the Indenture Trustee in the
same order of priority, and in the same manner, as it would have distributed
the payment in respect of which such payment under the Guarantee was
received.
ARTICLE IV
COVENANTS OF THE OWNER TRUSTEE; EVENTS OF
DEFAULT; REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of the Owner Trustee.
The Owner Trustee hereby covenants and agrees (the covenants
and agreements only in clause (b) below being made by the Owner Trustee in
its individual capacity) as follows:
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(a) the Owner Trustee will duly and punctually
pay the Principal Amount of, Make-Whole Amount, if any, and
interest on and other amounts due under the Secured
Certificates and hereunder in accordance with the terms of
the Secured Certificates and this Trust Indenture and all
amounts, if any, payable by it to the Certificate Holders
under the Participation Agreement;
(b) the Owner Trustee in its individual
capacity covenants and agrees that it shall not, directly or
indirectly, cause or permit to exist a Lessor Lien
attributable to it in its individual capacity with respect
to the Aircraft or any other portion of the Trust Estate;
that it will promptly, at its own expense, take such action
as may be necessary to duly discharge such Lessor Lien
attributable to it in its individual capacity; and that it
will make restitution to the Trust Estate for any actual
diminution of the assets of the Trust Estate resulting from
such Lessor Liens attributable to it in its individual
capacity;
(c) in the event the Owner Trustee shall have
Actual Knowledge of an Event of Default, a Default or an
Event of Loss, the Owner Trustee will give prompt written
notice of such Event of Default, Default or Event of Loss to
the Indenture Trustee, each Certificate Holder, Lessee and
the Owner Participant;
(d) the Owner Trustee will furnish to the
Indenture Trustee, promptly upon receipt thereof, duplicates
or copies of all reports, notices, requests, demands,
certificates and other instruments furnished to the Owner
Trustee under the Lease, including, without limitation, a
copy of any Termination Notice and a copy of each report or
notice received pursuant to Section 9(a) and 11(c) of the
Lease to the extent that the same shall not have been
furnished to the Indenture Trustee pursuant to the Lease;
(e) except pursuant to the Operative Documents
or with the consent of the Indenture Trustee (acting
pursuant to instructions given in accordance with Section
9.01 hereof), the Owner Trustee will not contract for,
create, incur, assume or suffer to exist any Debt, and will
not guarantee (directly or indirectly or by an instrument
having the effect of assuring another's payment or
performance on any obligation or capability of so doing, or
otherwise), endorse or otherwise be or become contingently
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liable, directly or indirectly, in connection with the Debt
of any other person; and
(f) the Owner Trustee will not enter into any
business or other activity other than the business of owning
the Aircraft, the leasing thereof to Lessee and the carrying
out of the transactions contemplated hereby and by the
Lease, the Participation Agreement, the Trust Agreement and
the other Operative Documents.
SECTION 4.02. Event of Default.
"Event of Default" means any of the following events
(whatever the reason for such Event of Default and whether such event shall
be voluntary or involuntary or come about or be effected by operation of Law
or pursuant to or in compliance with any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(a) any Lease Event of Default (provided that any such
Lease Event of Default caused solely by a failure of Lessee to pay to the
Owner Trustee or the Owner Participant when due any amount that is included
in the definition of Excluded Payments shall not constitute an Event of
Default unless notice is given by the Owner Trustee to the Indenture Trustee
that such failure shall constitute an Event of Default); or
(b) the failure of the Owner Trustee to pay when due any
payment of Principal Amount of, interest on, Make-Whole Amount, if any, or
other amount due and payable under any Secured Certificate or hereunder
(other than any such failure arising by virtue of a tax withheld pursuant to
Section 2.04(b) hereof or as a result of a Lease Event of Default or a Lease
Default) and such failure shall have continued unremedied for ten (10)
Business Days in the case of any payment of Principal Amount or interest or
Make-Whole Amount, if any, thereon and, in the case of any other amount, for
ten (10) Business Days after the Owner Trustee or the Owner Participant
receives written demand from the Indenture Trustee or any Certificate Holder;
or
(c) any Lien required to be discharged by the Owner
Trustee, in its individual capacity pursuant to Section 4.01(b) hereof or in
its individual or trust capacity pursuant to Section 8(h) of the
Participation Agreement, or by the Owner Participant pursuant to Section 8(h)
of the Participation Agreement shall remain undischarged for a period of
thirty (30) days after the Owner Trustee and the Owner Participant shall have
received written notice from the Indenture Trustee or any Certificate Holder
of such Lien; or
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(d) any representation or warranty made by the Owner
Participant or the Owner Trustee herein, in the Participation Agreement or in
any document or certificate furnished by the Owner Participant or the Owner
Trustee to the Indenture Trustee or any Certificate Holder in connection with
the transactions contemplated by the Operative Documents shall prove to have
been false or incorrect when made in any material respect and continues to be
material and adverse to the interests of the Indenture Trustee or the
Certificate Holders; and if such misrepresentation is capable of being
corrected and if such correction is being sought diligently, such
misrepresentation shall not have been corrected within sixty (60) days (or,
without affecting Section 4.02(f) hereof, in the case of the representations
made in Section 8(c) of the Participation Agreement as to the citizenship of
the Owner Trustee in its individual capacity or of the Owner Participant,
respectively, as soon as is reasonably practicable but in any event within
sixty (60) days) following notice thereof from the Indenture Trustee or any
Certificate Holder to the Owner Trustee or the Owner Participant, as the case
may be; or
(e) other than as provided in (c) above or (f) below,
any failure by the Owner Trustee or Owner Participant to observe or perform
any other covenant or obligation of the Owner Trustee or Owner Participant,
as the case may be, for the benefit of the Indenture Trustee or the
Certificate Holders contained in the Participation Agreement, Section 4.01(a)
of the Trust Agreement, the Secured Certificates or this Trust Indenture
which is not remedied within a period of sixty (60) days after notice thereof
has been given to the Owner Trustee and the Owner Participant; or
(f) if at any time when the Aircraft is registered under
the laws of the United States, the Owner Participant shall not be a Citizen
of the United States, and as the result thereof the registration of the
Aircraft under the Federal Aviation Act, and regulations then applicable
thereunder, shall cease to be effective; provided that no Event of Default
shall be deemed to have occurred under this paragraph (f) unless such
circumstances continue unremedied for more than sixty (60) days after the
Owner Participant has Actual Knowledge of the state of facts that resulted in
such ineffectiveness and of such loss of citizenship; or
(g) at any time either (i) the commencement of an
involuntary case or other proceeding in respect of the Owner Participant, the
Owner Trustee or the Trust Estate in an involuntary case under the federal
bankruptcy laws, as now or hereafter constituted, or any other applicable
federal or state bankruptcy, insolvency or other similar law in the United
States or seeking the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Owner
Participant, the Owner Trustee or the Trust Estate or for all or
substantially all of its property, or seeking the winding-up or liquidation
of its affairs and the continuation of any such case or other proceeding
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undismissed and unstayed for a period of ninety (90) consecutive days; or
(ii) the commencement by the Owner Participant, the Owner Trustee or the
Trust Estate of a voluntary case or proceeding under the federal bankruptcy
laws, as now constituted or hereafter amended, or any other applicable
federal or state bankruptcy, insolvency or other similar law in the United
States, or the consent by the Owner Participant, the Owner Trustee or the
Trust Estate to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or other similar
official) of the Owner Participant, the Owner Trustee or the Trust Estate or
for all or substantially all of its property, or the making by the Owner
Participant, the Owner Trustee or the Trust Estate of any assignment for the
benefit of creditors or the Owner Participant or the Owner Trustee shall take
any action to authorize any of the foregoing; provided, however, that an
event referred to in this Section 4.02(g) with respect to the Owner
Participant shall not constitute an Event of Default if within thirty (30)
days of the commencement of the case or proceeding a final non-appealable
order, judgment or decree shall be entered in such case or proceeding by a
court or a trustee, custodian, receiver or liquidator, to the effect that, no
part of the Trust Estate (except for the Owner Participant's beneficial
interest therein) and no right, title or interest under the Trust Indenture
Estate shall be included in, or be subject to, any declaration or
adjudication of, or proceedings with respect to, the bankruptcy, insolvency
or liquidation of the Owner Participant referred to in this Section 4.02(g).
SECTION 4.03. Certain Rights.
The Indenture Trustee shall give the Certificate Holders,
the Owner Trustee and the Owner Participant prompt written notice of any
Event of Default of which the Indenture Trustee has Actual Knowledge and, if
any such Event of Default results from a Lease Event of Default, shall give
the Certificate Holders, the Owner Trustee and the Owner Participant not less
than ten (10) Business Days' prior written notice of the date (the
"Enforcement Date") on or after which the Indenture Trustee may commence and
consummate the exercise of any remedy or remedies described in Section 4.04,
4.05 or 4.06 hereof, or the exercise of any remedy or remedies pursuant to
the provisions of Section 15 of the Lease. If an Event of Default shall have
occurred and be continuing, the Owner Trustee shall have the following rights
hereunder, any of which may be exercised directly by the Owner Participant.
If as a result of the occurrence of an Event of Default in
respect of the nonpayment by Lessee of Basic Rent due under the Lease, the
Indenture Trustee shall have insufficient funds to make any payment of
Principal Amount and interest on any Secured Certificate on the day it
becomes due and payable, the Owner Trustee or the Owner Participant may, but
shall not be obligated to, pay the Indenture Trustee prior to the Enforcement
Date, in the manner provided in Section 2.04 hereof, for application in
accordance with Section 3.01 hereof, an amount equal to the portion of the
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Principal Amount and interest (including interest, if any, on any overdue
payments of such portion of Principal Amount and interest) then due and
payable on the Secured Certificates, and, unless the Owner Trustee has cured
Events of Default in respect of payments of Basic Rent on each of the three
immediately preceding Basic Rent payment dates, or the Owner Trustee has
cured six previous Events of Default in respect of payments of Basic Rent,
such payment by the Owner Trustee shall, solely for purposes of this Trust
Indenture be deemed to cure any Event of Default which would otherwise have
arisen on account of the nonpayment by Lessee of such installment of Basic
Rent (but not any other Default or Event of Default which shall have occurred
and be continuing).
If any Event of Default (other than in respect of the
nonpayment of Basic Rent by Lessee) which can be cured has occurred, the
Owner Trustee or the Owner Participant may, but shall not be obligated to,
cure such Event of Default by taking such action prior to the Enforcement
Date as is necessary to accomplish the observance or performance of the
defaulted covenant, condition or agreement.
Except as hereinafter in this Section 4.03 provided, the
Owner Trustee shall not, as a result of exercising the right to cure any such
Event of Default, obtain any Lien on any of the Mortgaged Property or any
Rent payable under the Lease for or on account of costs or expenses incurred
in connection with the exercise of such right, nor shall any claim of the
Owner Trustee against Lessee or any other party for the repayment of such
costs or expenses impair the prior right and security interest of the
Indenture Trustee in and to the Mortgaged Property. Upon any payment by the
Owner Trustee or the Owner Participant pursuant to the first or second
preceding paragraphs of this Section 4.03, the Owner Trustee or the Owner
Participant, as the case may be, shall be subrogated to the rights of the
Indenture Trustee and the Certificate Holders in respect of the Basic Rent
which was overdue at the time of such payment and interest payable by Lessee
on account of its being overdue and any Supplemental Rent in respect of the
reimbursement of amounts paid by the Owner Trustee pursuant to the
immediately preceding paragraph (but in either case shall have no rights as a
secured party hereunder), and thereafter, the Owner Trustee or the Owner
Participant, as the case may be, shall be entitled to receive such overdue
Basic Rent or Supplemental Rent, as the case may be, and interest thereon
upon receipt thereof by the Indenture Trustee (and shall be entitled to bring
an action against Lessee to enforce such payment); provided, however, that
(i) if the Principal Amount and interest on the Secured Certificates shall
have become due and payable pursuant to Section 4.04(b) hereof, such
subrogation shall, until the Principal Amount of, interest on, Make-Whole
Amount, if any, and all other amounts due with respect to all Secured
Certificates shall have been paid in full, be subordinate to the rights of
the Indenture Trustee and the Certificate Holders in respect of such payment
of overdue Basic Rent, Supplemental Rent and such interest and (ii) the Owner
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Trustee shall not be entitled to seek to recover any such payment (or any
payment in lieu thereof) except pursuant to the foregoing right of
subrogation by demand or suit for damages.
SECTION 4.04. Remedies.
(a) Subject to the provisions of Section 2.14 hereof, if
an Event of Default shall have occurred and be continuing and so long as the
same shall continue unremedied, then and in every such case the Indenture
Trustee may, subject to the second paragraph of this Section 4.04(a), on and
after the Enforcement Date if such Event of Default results from a Lease
Event of Default, exercise any or all of the rights and powers and pursue any
and all of the remedies pursuant to this Article IV and shall have and may
exercise all of the rights and remedies of a secured party under the Uniform
Commercial Code and, in the event such Event of Default is also a Lease Event
of Default, any and all of the remedies pursuant to Section 15 of the Lease
and may take possession of all or any part of the properties covered or
intended to be covered by the Lien created hereby or pursuant hereto and may
exclude the Owner Participant, the Owner Trustee and Lessee and all persons
claiming under any of them wholly or partly therefrom, provided, that the
Indenture Trustee shall give the Owner Trustee and the Owner Participant
twenty (20) days' prior written notice of its intention to sell the Aircraft;
provided, further, that in the event the Indenture Trustee shall have validly
terminated the Lease (or, in the event of a reorganization proceeding
involving Lessee instituted under Chapter 11 of the Bankruptcy Code, such
Lease is rejected), the Indenture Trustee shall not, without the consent of
the Owner Participant (which consent shall not be unreasonably withheld),
sell or lease, or otherwise afford the use of, the Aircraft or any portion
thereof to Lessee or any Affiliate thereof. Unless an Event of Default not
resulting from or relating to a Lease Event of Default has occurred and is
continuing, the Owner Participant may bid at any public sale and become the
purchaser. Without limiting any of the foregoing, it is understood and
agreed that the Indenture Trustee may exercise any right of sale of the
Aircraft available to it, even though it shall not have taken possession of
the Aircraft and shall not have possession thereof at the time of such sale.
Anything in this Trust Indenture to the contrary
notwithstanding, the Indenture Trustee shall not be entitled to exercise any
remedy hereunder as a result of an Event of Default which arises solely by
reason of one or more events or circumstances which constitute a Lease Event
of Default unless the Indenture Trustee as security assignee of the Owner
Trustee shall have exercised or concurrently be exercising one or more of the
remedies provided for in Section 15 of the Lease to terminate the Lease or
take possession and/or sell the Aircraft; provided, however, that such
requirement to exercise one or more of such remedies under the Lease shall
not apply in circumstances where the Indenture Trustee is, and has been, for
a continuous period in excess of 60 days or such other period as may be
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specified in Section 1110 of the Bankruptcy Code (such 60-day or other period
being the "Section 1110 Period"), involuntarily stayed or prohibited by
applicable law or court order from exercising such remedies under the Lease
(a "Continuous Stay Period"); provided further, however, that the requirement
to exercise one or more of such remedies under the Lease shall nonetheless be
applicable during a Continuous Stay Period subsequent to the expiration of
the Section 1110 Period to the extent that the continuation of such
Continuous Stay Period subsequent to the expiration of the Section 1110
Period (A) results from an agreement by the trustee or the
debtor-in-possession in such proceeding during the Section 1110 Period with
the approval of the relevant court to perform the Lease in accordance with
Section 1110(a)(2)(A) of the Bankruptcy Code and continues to perform as
required by Section 1110(a)(2)(A-B) of the Bankruptcy Code or (B) is an
extension of the Section 1110 Period with the consent of the Indenture
Trustee pursuant to Section 1110(b) of the Bankruptcy Code or (C) (D) is the
consequence of the Indenture Trustee's own failure to give any requisite
notice to any Person. In the event that the applicability of Section 1110 of
the Bankruptcy Code to the Aircraft is being contested by Lessee in judicial
proceedings, both the Indenture Trustee and the Owner Trustee (without
affecting in any way any right or remedy of the Indenture Trustee hereunder)
shall have the right to participate in such proceedings.
It is expressly understood and agreed that, subject only to
the immediately preceding paragraph, the inability, described in such
paragraphs, of the Indenture Trustee to exercise any right or remedy under
the Lease shall in no event and under no circumstances prevent the Indenture
Trustee from exercising any or all of its rights, powers and remedies under
this Trust Indenture, including, without limitation, this Article IV.
(b) If an Event of Default shall have occurred and be
continuing, then and in every such case the Indenture Trustee may (and shall,
upon receipt of a written demand therefor from a Majority in Interest of
Certificate Holders), subject to Section 4.03 hereof, at any time, by
delivery of written notice or notices to the Owner Trustee and the Owner
Participant, declare all the Secured Certificates to be due and payable,
whereupon the unpaid Principal Amount of all Secured Certificates then
outstanding, together with accrued but unpaid interest thereon (without
Make-Whole Amount) and other amounts due thereunder, shall immediately become
due and payable without presentment, demand, protest or notice, all of which
are hereby waived.
This Section 4.04(b), however, is subject to the condition
that, if at any time after the Principal Amount of the Secured Certificates
shall have become so due and payable, and before any judgment or decree for
the payment of the money so due, or any thereof, shall be entered, all
overdue payments of interest upon the Secured Certificates and all other
amounts payable under the Secured Certificates (except the Principal Amount
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of the Secured Certificates which by such declaration shall have become
payable) shall have been duly paid, and every other Default and Event of
Default with respect to any covenant or provision of this Trust Indenture
shall have been cured, then and in every such case a Majority in Interest of
Certificate Holders may (but shall not be obligated to), by written
instrument filed with the Indenture Trustee, rescind and annul the Indenture
Trustee's declaration and its consequences; but no such rescission or
annulment shall extend to or affect any subsequent Default or Event of
Default or impair any right consequent thereon.
(c) Any Certificate Holder shall be entitled, at any
sale pursuant to Section 15 of the Lease or this Section 4.04, to credit
against any purchase price bid at such sale by such holder all or any part of
the unpaid obligations owing to such Certificate Holder and secured by the
Lien of this Trust Indenture (but only to the extent that such purchase price
would have been paid to such Certificate Holder pursuant to Article III
hereof if such purchase price were paid in cash and the foregoing provisions
of this subsection (c) were not given effect).
(d) In the event of any sale of the Trust Indenture
Estate, or any part thereof, pursuant to any judgment or decree of any court
or otherwise in connection with the enforcement of any of the terms of this
Trust Indenture, the unpaid Principal Amount of all Secured Certificates then
outstanding, together with accrued interest thereon, and other amounts due
thereunder, shall immediately become due and payable without presentment,
demand, protest or notice, all of which are hereby waived.
(e) Notwithstanding anything contained herein, so long
as the Pass Through Trustee under any Pass Through Trust Agreement or the
Subordination Agent on its behalf is a Certificate Holder, the Indenture
Trustee will not be authorized or empowered to acquire title to any Mortgaged
Property or take any action with respect to any Mortgaged Property so
acquired by it if such acquisition or action would cause any Pass Through
Trust to fail to qualify as a "grantor trust" for federal income tax
purposes.
SECTION 4.05. Return of Aircraft, Etc.
(a) If an Event of Default shall have occurred and be
continuing, subject to Sections 4.03 and 4.04 hereof, at the request of the
Indenture Trustee, the Owner Trustee shall promptly execute and deliver to
the Indenture Trustee such instruments of title and other documents as the
Indenture Trustee may deem necessary or advisable to enable the Indenture
Trustee or an agent or representative designated by the Indenture Trustee, at
such time or times and place or places as the Indenture Trustee may specify,
to obtain possession of all or any part of the Mortgaged Property included in
the Trust Indenture Estate to which the Indenture Trustee shall at the time
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be entitled hereunder. If the Owner Trustee shall for any reason fail to
execute and deliver such instruments and documents after such request by the
Indenture Trustee, the Indenture Trustee may (i) obtain a judgment conferring
on the Indenture Trustee the right to immediate possession and requiring the
Owner Trustee to execute and deliver such instruments and documents to the
Indenture Trustee, to the entry of which judgment the Owner Trustee hereby
specifically consents to the fullest extent permitted by applicable law, and
(ii) pursue all or part of such Mortgaged Property wherever it may be found
and, in the event that a Lease Event of Default has occurred and is
continuing, may enter any of the premises of Lessee wherever such Mortgaged
Property may be or be supposed to be and search for such Mortgaged Property
and take possession of and remove such Mortgaged Property. All expenses of
obtaining such judgment or of pursuing, searching for and taking such
property shall, until paid, be secured by the Lien of this Trust Indenture.
(b) Upon every such taking of possession, the Indenture
Trustee may, from time to time, at the expense of the Mortgaged Property,
make all such expenditures for maintenance, use, operation, storage,
insurance, leasing, control, management, disposition, modifications or
alterations to and of the Mortgaged Property, as it may deem proper. In each
such case, the Indenture Trustee shall have the right to maintain, use,
operate, store, insure, lease, control, manage, dispose of, modify or alter
the Mortgaged Property and to carry on the business and to exercise all
rights and powers of the Owner Participant and the Owner Trustee relating to
the Mortgaged Property, as the Indenture Trustee shall deem best, including
the right to enter into any and all such agreements with respect to the
maintenance, use, operation, storage, insurance, leasing, control,
management, disposition, modification or alteration of the Mortgaged Property
or any part thereof as the Indenture Trustee may determine, and the Indenture
Trustee shall be entitled to collect and receive directly all tolls, rents
(including Rent), revenues, issues, income, products and profits of the
Mortgaged Property and every part thereof, except Excluded Payments, without
prejudice, however, to the right of the Indenture Trustee under any provision
of this Trust Indenture to collect and receive all cash held by, or required
to be deposited with, the Indenture Trustee hereunder. Such tolls, rents
(including Rent), revenues, issues, income, products and profits shall be
applied to pay the expenses of the maintenance, use, operation, storage,
insurance, leasing, control, management, disposition, improvement,
modification or alteration of the Mortgaged Property and of conducting the
business thereof, and to make all payments which the Indenture Trustee may be
required or may elect to make, if any, for taxes, assessments, insurance or
other proper charges upon the Mortgaged Property or any part thereof
(including the employment of engineers and accountants to examine, inspect
and make reports upon the properties and books and records of the Owner
Trustee), and all other payments which the Indenture Trustee may be required
or authorized to make under any provision of this Trust Indenture, as well as
just and reasonable compensation for the services of the Indenture Trustee,
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and of all persons properly engaged and employed by the Indenture Trustee
with respect hereto.
SECTION 4.06. Remedies Cumulative.
Each and every right, power and remedy given to the
Indenture Trustee specifically or otherwise in this Trust Indenture shall be
cumulative and shall be in addition to every other right, power and remedy
herein specifically given or now or hereafter existing at law, in equity or
by statute, and each and every right, power and remedy whether specifically
herein given or otherwise existing may be exercised from time to time and as
often and in such order as may be deemed expedient by the Indenture Trustee,
and the exercise or the beginning of the exercise of any power or remedy
shall not be construed to be a waiver of the right to exercise at the same
time or thereafter any other right, power or remedy. No delay or omission by
the Indenture Trustee in the exercise of any right, remedy or power or in the
pursuance of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default on the part of the Owner Trustee or
Lessee or to be an acquiescence therein.
SECTION 4.07. Discontinuance of Proceedings.
In case the Indenture Trustee shall have instituted any
proceeding to enforce any right, power or remedy under this Trust Indenture
by foreclosure, entry or otherwise, and such proceedings shall have been
discontinued or abandoned for any reason or shall have been determined
adversely to the Indenture Trustee, then and in every such case the Owner
Trustee, the Indenture Trustee and Lessee shall, subject to any determination
in such proceedings, be restored to their former positions and rights
hereunder with respect to the Mortgaged Property, and all rights, remedies
and powers of the Owner Trustee, the Indenture Trustee or Lessee shall
continue as if no such proceedings had been instituted.
SECTION 4.08. Waiver of Past Defaults.
Upon written instruction from a Majority in Interest of
Certificate Holders, the Indenture Trustee shall waive any past Default
hereunder and its consequences and upon any such waiver such Default shall
cease to exist and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Trust Indenture, but no such waiver
shall extend to any subsequent or other Default or impair any right
consequent thereon; provided, that in the absence of written instructions
from all the Certificate Holders, the Indenture Trustee shall not waive any
Default (i) in the payment of the Principal Amount, Make-Whole Amount, if
any, and interest and other amounts due under any Secured Certificate then
outstanding, or (ii) in respect of a covenant or provision hereof which,
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under Article IX hereof, cannot be modified or amended without the consent of
each Certificate Holder.
SECTION 4.09. Appointment of Receiver.
The Indenture Trustee shall, as a matter of right, be
entitled to the appointment of a receiver (who may be the Indenture Trustee
or any successor or nominee thereof) for all or any part of the Mortgaged
Property, whether such receivership be incidental to a proposed sale of the
Mortgaged Property or the taking of possession thereof or otherwise, and the
Owner Trustee hereby consents to the appointment of such a receiver and will
not oppose any such appointment. Any receiver appointed for all or any part
of the Mortgaged Property shall be entitled to exercise all the rights and
powers of the Indenture Trustee with respect to the Mortgaged Property.
SECTION 4.10. Indenture Trustee Authorized to Execute Bills
of Sale, Etc.
The Owner Trustee irrevocably appoints the Indenture Trustee
the true and lawful attorney-in-fact of the Owner Trustee in its name and
stead and on its behalf, for the purpose, if an Event of Default shall have
occurred and be continuing, of effectuating any sale, assignment, transfer or
delivery for the enforcement of the Lien of this Trust Indenture, whether
pursuant to foreclosure or power of sale, assignments and other instruments
as may be necessary or appropriate, with full power of substitution, the
Owner Trustee hereby ratifying and confirming all that such attorney or any
substitute shall do by virtue hereof in accordance with applicable law.
Nevertheless, if so requested by the Indenture Trustee or any purchaser, the
Owner Trustee shall ratify and confirm any such sale, assignment, transfer or
delivery, by executing and delivering to the Indenture Trustee or such
purchaser all bills of sale, assignments, releases and other proper
instruments to effect such ratification and confirmation as may be designated
in any such request.
SECTION 4.11. Rights of Certificate Holders to Receive
Payment.
Notwithstanding any other provision of this Trust Indenture,
the right of any Certificate Holder to receive payment of principal of, and
premium, if any, and interest on a Secured Certificate on or after the
respective due dates expressed in such Secured Certificate, or to bring suit
for the enforcement of any such payment on or after such respective dates in
accordance with the terms hereof, shall not be impaired or affected without
the consent of such Certificate Holder.
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ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Event of Default.
If the Indenture Trustee shall have Actual Knowledge of an
Event of Default or of a Default arising from a failure to pay Rent, the
Indenture Trustee shall give prompt written notice thereof to the Owner
Trustee, the Owner Participant, Lessee, and each Certificate Holder. Subject
to the terms of Sections 4.03, 4.04, 4.08, 5.02 and 5.03 hereof, the
Indenture Trustee shall take such action, or refrain from taking such action,
with respect to such Event of Default or Default (including with respect to
the exercise of any rights or remedies hereunder) as the Indenture Trustee
shall be instructed in writing by a Majority in Interest of Certificate
Holders. Subject to the provisions of Section 5.03, if the Indenture Trustee
shall not have received instructions as above provided within twenty (20)
days after mailing notice of such Event of Default to the Certificate
Holders, the Indenture Trustee may, subject to instructions thereafter
received pursuant to the preceding provisions of this Section 5.01, take such
action, or refrain from taking such action, but shall be under no duty to
take or refrain from taking any action, with respect to such Event of Default
or Default as it shall determine advisable in the best interests of the
Certificate Holders; provided, however, that the Indenture Trustee may not
sell the Aircraft or any Engine without the consent of a Majority in Interest
of Certificate Holders. If the Indenture Trustee shall at any time declare
the Lease to be in default pursuant to Section 15 thereof or shall elect to
foreclose or otherwise enforce this Trust Indenture, the Indenture Trustee
shall forthwith notify the Owner Participant, the Certificate Holders, the
Owner Trustee and Lessee. For all purposes of this Trust Indenture, in the
absence of Actual Knowledge on the part of the Indenture Trustee, the Owner
Trustee or the Owner Participant, the Indenture Trustee, the Owner Trustee or
the Owner Participant, as the case may be, shall not be deemed to have
knowledge of a Default or an Event of Default (except, in the case of the
Indenture Trustee, the failure of Lessee to pay any installment of Basic Rent
within one (1) Business Day after the same shall become due, if any portion
of such installment was then required to be paid to the Indenture Trustee,
which failure shall constitute knowledge of a Default) unless notified in
writing by Lessee, the Owner Trustee, the Owner Participant or one or more
Certificate Holders.
SECTION 5.02. Action upon Instructions; Certain Rights and
Limitations.
(a) Subject to the terms of Sections 2.14, 4.03,
4.04(a), 4.08, 5.01 and 5.03 hereof, upon the written instructions at any
time and from time to time of a Majority in Interest of Certificate Holders,
the Indenture Trustee shall, subject to the terms of this Section 5.02, take
such of the following actions as may be specified in such instructions: (i)
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give such notice or direction or exercise such right, remedy or power
hereunder as shall be specified in such instructions; (ii) give such notice
or direction or exercise such right, remedy or power under the Lease, the
Participation Agreement, the Purchase Agreement, or any other part of the
Trust Indenture Estate as shall be specified in such instructions; and (iii)
after the occurrence and during the continuance of an Event of Default,
approve as satisfactory to the Indenture Trustee all matters required by the
terms of the Lease to be satisfactory to the Owner Trustee, it being
understood that without the written instructions of a Majority in Interest of
Certificate Holders, the Indenture Trustee shall not approve any such matter
as satisfactory to the Indenture Trustee; provided, that anything contained
in this Trust Indenture, the Lease or the other Operative Documents to the
contrary notwithstanding:
(1) the Owner Trustee or the Owner Participant may,
without the consent of the Indenture Trustee, demand, collect, xxx
for or otherwise obtain all amounts included in Excluded Payments
from Lessee or the Guarantor, exercise any election or option or make
any decision or determination or to give or receive any notice,
consent, waiver or approval in respect of any Excluded Payment and
seek legal or equitable remedies to require Lessee or the Guarantor
to maintain the insurance coverage referred to in Section 11 of the
Lease; provided, that the rights referred to in this clause (1) shall
not be deemed to include the exercise of any remedies provided for in
Section 15 of the Lease other than the right to proceed by
appropriate court action, either at law or in equity, to enforce
payment by Lessee or the Guarantor of such amounts included in
Excluded Payments or performance by Lessee or the Guarantor of such
insurance covenant, or to recover damages for the breach thereof or
for specific performance of any covenant of Lessee or the Guarantor;
(2) (A) the Indenture Trustee shall not, without the
consent of the Owner Trustee, execute or deliver amendments or
modifications in respect of any provisions of the Lease, and (B)
unless an Event of Default and an Indenture Trustee Event shall have
occurred and be continuing and except as provided in clause (4)
below, the Indenture Trustee shall not, without the consent of the
Owner Trustee, which consent shall not be withheld if no right or
interest of the Owner Trustee or the Owner Participant shall be
diminished or impaired thereby, (i) enter into, execute or deliver
waivers or consents in respect of any of the provisions of the Lease,
or (ii) approve any accountants, engineers, appraisers or counsel as
satisfactory to render services for or issue opinions to the Owner
Trustee pursuant to the Operative Documents; provided that, whether
or not an Event of Default shall have occurred and be continuing, no
amendment, modification, waiver or consent in respect of the Lease
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shall affect the amount or timing of, or the right to enforce payment
of, any Excluded Payment;
(3) whether or not a Default or Event of Default under
the Trust Indenture has occurred and is continuing, the Owner Trustee
and the Owner Participant shall have the right, together with the
Indenture Trustee, (i) to receive from Lessee all notices,
certificates, reports, filings, opinions of counsel and other
documents and all information which any thereof is permitted or
required to give or furnish to the Owner Trustee or Lessor pursuant
to any Operative Document (including pursuant to Section 7(b) of the
Participation Agreement), (ii) to exercise inspection rights pursuant
to Section 12 of the Lease, (iii) to retain all rights with respect
to insurance maintained for its own account which Section 11(e) of
the Lease specifically confers on Lessor or the Owner Participant,
(iv) to exercise, to the extent necessary to enable it to exercise
its rights under Section 4.03 hereof, the rights of Lessor under
Section 21 of the Lease and (v) to give notices of default under
Section 14 of the Lease;
(4) whether or not a Default or Event of Default under
the Trust Indenture has occurred and is continuing, the Owner Trustee
shall have the right to the exclusion of the Indenture Trustee to
adjust Rent, Stipulated Loss Values and Termination Values as
provided in Section 3(d) of the Lease and to select counsel with
respect to any opinion relating to tax matters to be delivered solely
to the Owner Participant;
(5) whether or not a Default or Event of Default under
the Trust Indenture has occurred and is continuing, the Owner Trustee
may, without the consent of the Indenture Trustee, (i) solicit and
make bids with respect to the Aircraft under Section 9 of the Lease
in respect of a termination of the Lease by Lessee pursuant to
Section 9 thereof, (ii) determine "fair market sales value" and "fair
market rental value" under Section 19 of the Lease for all purposes
except following an Event of Default pursuant to Section 15 of the
Lease, and (iii) make an election pursuant to and in accordance with
the provisions of Section 9(c) of the Lease; and
(6) so long as no Event of Default shall have occurred
and be continuing, except as provided in clauses (2) and (3) above,
all rights of the "Lessor" under the Lease shall be exercised by the
Owner Trustee to the exclusion of the Indenture Trustee including,
without limitation, the right to (i) exercise all rights with respect
to Lessee's use and operation, modification or maintenance of the
Aircraft and any Engine which the Lease specifically confers on
Lessor, and (ii) consent to and approve any assignment pursuant to
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Section 13 of the Lease; provided that the foregoing shall not limit
(A) any rights separately granted to the Indenture Trustee under the
Operative Documents or (B) the right of the Indenture Trustee to
receive any funds to be delivered to the "Lessor" under the Lease
(except with respect to Excluded Payments) and under the Purchase
Agreement.
Notwithstanding anything to the contrary contained herein,
the Indenture Trustee shall have the right, to the exclusion of the Owner
Trustee and the Owner Participant, to (A) declare the Lease to be in default
under Section 15 thereof and (B) subject only to the provisions of Sections
4.03, 4.04(a) and 2.14 hereof, exercise the remedies set forth in such
Section 15 (other than in connection with Excluded Payments) at any time that
a Lease Event of Default shall have occurred and be continuing.
The Indenture Trustee will execute and the Owner Trustee
will file or cause to be filed such continuation statements with respect to
financing statements relating to the security interest created hereunder in
the Trust Indenture Estate as specified by Lessee pursuant to Section 8(e) of
the Participation Agreement or as may be specified from time to time in
written instructions of a Majority in Interest of Certificate Holders (which
instructions may, by their terms, be operative only at a future date and
which shall be accompanied by the form of such continuation statement so to
be filed). The Indenture Trustee will furnish to each Certificate Holder
(and, during the continuation of an Indenture Trustee Event, to the Owner
Trustee and Owner Participant), promptly upon receipt thereof, duplicates or
copies of all reports, notices, requests, demands, certificates and other
instruments furnished to the Indenture Trustee under the Lease or hereunder,
including, without limitation, a copy of any Termination Notice (as defined
in the Lease) and a copy of each report or notice received pursuant to
Sections 9(a) and 11(c) of the Lease, respectively, to the extent that the
same shall not have been furnished to such Certificate Holder pursuant hereto
or to the Lease.
(b) If any Lease Event of Default shall have occurred
and be continuing and the Owner Trustee shall not have cured fully such Lease
Event of Default under and in accordance with Section 4.03 hereof, on request
of a Majority in Interest of Certificate Holders, the Indenture Trustee shall
declare the Lease to be in default pursuant to Section 15 thereof and
exercise those remedies specified by such Certificate Holders. The Indenture
Trustee agrees to provide to the Certificate Holders, the Owner Trustee, the
Owner Participant and Lessee concurrently with such declaration by the
Indenture Trustee, notice of such declaration by the Indenture Trustee.
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SECTION 5.03. Indemnification.
The Indenture Trustee shall not be under any obligation to
take any action under this Trust Indenture and nothing herein or therein
shall require the Indenture Trustee to expend or risk its own funds or
otherwise incur the risk of any financial liability in the performance of any
of its rights or powers if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it (the written indemnity of any
Certificate Holder who is a QIB, signed by an authorized officer thereof, in
favor of, delivered to and in form reasonably satisfactory to Indenture
Trustee shall be accepted as reasonable assurance of adequate indemnity).
The Indenture Trustee shall not be required to take any action under Section
5.01 (other than the first sentence thereof) or 5.02 or Article IV hereof,
nor shall any other provision of this Trust Indenture or any other Operative
Document be deemed to impose a duty on the Indenture Trustee to take any
action, if the Indenture Trustee shall have been advised by counsel that such
action is contrary to the terms hereof or of the Lease or is otherwise
contrary to Law.
SECTION 5.04. No Duties Except as Specified in Trust
Indenture or Instructions.
The Indenture Trustee shall not have any duty or obligation
to use, operate, store, lease, control, manage, sell, dispose of or otherwise
deal with the Aircraft or any other part of the Trust Indenture Estate, or to
otherwise take or refrain from taking any action under, or in connection
with, this Trust Indenture or any part of the Trust Indenture Estate, except
as expressly provided by the terms of this Trust Indenture or as expressly
provided in written instructions from Certificate Holders as provided in this
Trust Indenture; and no implied duties or obligations shall be read into this
Trust Indenture against the Indenture Trustee. The Indenture Trustee agrees
that it will in its individual capacity and at its own cost and expense (but
without any right of indemnity in respect of any such cost or expense under
Section 7.01 hereof), promptly take such action as may be necessary duly to
discharge all liens and encumbrances on any part of the Trust Indenture
Estate which result from claims against it in its individual capacity not
related to the ownership of the Aircraft or the administration of the Trust
Indenture Estate or any other transaction pursuant to this Trust Indenture or
any document included in the Trust Indenture Estate.
SECTION 5.05. No Action Except Under Lease, Trust Indenture
or Instructions.
The Owner Trustee and the Indenture Trustee agree that they
will not use, operate, store, lease, control, manage, sell, dispose of or
otherwise deal with the Aircraft or any other part of the Trust Indenture
Estate except (i) as required by the terms of the Lease or (ii) in accordance
with the powers granted to, or the authority conferred upon, the Owner
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Trustee and the Indenture Trustee pursuant to this Trust Indenture and in
accordance with the express terms hereof.
SECTION 5.06. Replacement Airframes and Replacement
Engines.
At any time an Airframe or Engine is to be replaced under or
pursuant to Section 10 of the Lease by a Replacement Airframe or Replacement
Engine, the Owner Trustee shall direct the Indenture Trustee to execute and
deliver to the Owner Trustee an appropriate instrument releasing such
Airframe and/or Engine as appropriate from the Lien of this Trust Indenture
and the Indenture Trustee shall execute and deliver such instrument as
aforesaid, but only upon compliance by Lessee with the applicable provisions
of Section 10 of the Lease and upon receipt by or deposit with the Indenture
Trustee of the following:
(1) A written request from the Owner Trustee, requesting
such release specifically describing the Airframe and/or Engine(s) so to be
released.
(2) A certificate signed by a duly authorized officer of
Lessee stating the following:
A. With respect to the replacement of any Airframe:
(i) a description of the Airframe which shall
be identified by manufacturer, model, FAA
registration number (or other applicable
registration information) and
manufacturer's serial number;
(ii) a description of the Replacement Airframe
to be received (including the manufacturer,
model, FAA registration number (or other
applicable registration information) and
manufacturer's serial number) as
consideration for the Airframe to be
released;
(iii) that the Replacement Airframe is of the
same or an improved model as the Airframe
requested to be released from this
Indenture;
(iv) the value, utility and remaining useful
life (without regard to hours or cycles) of
the Replacement Airframe as of the date of
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such certificate (which in the judgment of
Lessee shall be not less than the value,
utility and remaining useful life (without
regard to hours or cycles) of the Airframe
requested to be released (assuming no Event
of Loss and that such Airframe was in the
condition and repair required to be
maintained under the Lease)); and
(v) that no Lease Event of Default and no event
which, with lapse of time or notice, or
both, would become a Lease Event of
Default, has occurred which has not been
remedied or waived, and that Lessee will
not be in default, by the making and
granting of the request for release and the
addition of a Replacement Airframe, in the
performance of any of the terms and
covenants of the Lease.
B. with respect to the replacement of any Engine:
(i) a description of the Engine which shall be
identified by manufacturer's serial number;
(ii) a description of the Replacement Engine
(including the manufacturer's name and
serial number) as consideration for the
Engine to be released;
(iii) that such Replacement Engine is
substantially the same as the Engine to be
released (or an improved model);
(iv) the value, utility and remaining useful
life (without regard to hours or cycles) of
the Replacement Engine as of the date of
such certificate (which value shall not be
less than the value, utility and remaining
useful life (without regard to hours or
cycles) of the Engine to be released
(assuming no Event of Loss and that such
Engine was in the condition and repair
required to be maintained under the
Lease));
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(v) that each of the conditions specified in
Section 10(b) of the Lease with respect to
such Replacement Engine have been
satisfied; and
(vi) that, with respect to the replacement of an
Engine pursuant to Section 9(d) of the
Lease, no Lease Event of Default and no
Lease Default has occurred which has not
been remedied or waived.
(3) (a) The appropriate instruments (i) transferring to
the Owner Trustee title to the Replacement Airframe or Replacement Engine to
be received as consideration for the Airframe or Engine to be released and
(ii) assigning to the Owner Trustee the benefit of all manufacturer's and
vendor's warranties generally available with respect to such Replacement
Airframe or Replacement Engine, and a Trust Agreement and Indenture
Supplement subjecting such Replacement Airframe or Replacement Engine and any
related warranty rights to the lien of this Indenture.
(b) With respect to the replacement of any Engine, such
Uniform Commercial Code financing statements covering the lien created by
this Indenture as deemed necessary or desirable by counsel for the Indenture
Trustee to protect the lien under the Indenture in the Replacement Engine.
(4) A certificate from either an aircraft engineer (who
may be an employee of Lessee) or a firm of independent aircraft appraisers
selected by Lessee confirming the accuracy of the information set forth in
clause (2)A(iv) of this Section 5.06.
(5) The opinion of in-house counsel to Lessee, or other
counsel satisfactory to the Indenture Trustee, stating that the Replacement
Airframe or Replacement Engine has been validly subjected to the lien of this
Indenture and covered by the Lease, the instruments subjecting such
Replacement Airframe or Replacement Engine to the Lease and to the Lien of
this Trust Indenture, as the case may be, have been duly filed for
recordation pursuant to the Federal Aviation Act or any other law then
applicable to the registration of the Aircraft, and no further action, filing
or recording of any document is necessary or advisable in order to establish
and perfect the right, title, estate and interest of the Owner Trustee to and
the lien of this Trust Indenture on such Replacement Aircraft or Replacement
Engine.
SECTION 5.07. Indenture Supplements for Replacements.
If a Replacement Airframe or Replacement Engine is being
substituted as contemplated by Section 10 of the Lease, the Owner Trustee and
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the Indenture Trustee agree for the benefit of the Certificate Holders and
Lessee, subject to fulfillment of the conditions precedent and compliance by
Lessee with its obligations set forth in Section 10 of the Lease and the
requirements of Section 5.06 hereof with respect to such Replacement Airframe
or Replacement Engine, to execute and deliver a Lease Supplement and a Trust
Agreement and Indenture Supplement, as applicable, as contemplated by Section
10 of the Lease.
SECTION 5.08. Effect of Replacement.
In the event of the substitution of an Airframe or of a
Replacement Engine pursuant to Section 10 of the Lease, (a) all provisions of
this Trust Indenture relating to the Airframe or Engine or Engines being
replaced shall be applicable to such Replacement Airframe or Replacement
Engine or Engines with the same force and effect as if such Replacement
Airframe or Replacement Engine or Engines were the same airframe or engine or
engines, as the case may be, as the Airframe or Engine or Engines being
replaced but for the Event of Loss with respect to the Airframe or Engine or
Engines being replaced, and (b) the provisions of this Trust Indenture shall
no longer be applicable to the Airframe or Engine or Engines being replaced,
which shall be released from the Lien of this Trust Indenture.
SECTION 5.09. Investment of Amounts Held by Indenture
Trustee.
Any amounts held by the Indenture Trustee as assignee of the
Owner Trustee's rights to hold monies for security pursuant to Section 22(a)
of the Lease shall be held in accordance with the terms of such Section and
the Indenture Trustee agrees, for the benefit of Lessee, to perform the
duties of the Owner Trustee under such Section. Any amounts held by the
Indenture Trustee pursuant to the proviso to the first sentence of Section
3.01, pursuant to Section 3.02, or pursuant to any provision of any other
Operative Document providing for amounts to be held by the Indenture Trustee
which are not distributed pursuant to the other provisions of Article III
hereof shall be invested by the Indenture Trustee from time to time in Cash
Equivalents as directed by the Owner Trustee in the case of amounts held
pursuant to the proviso to the first sentence of Section 3.01 and otherwise
by Lessee so long as the Indenture Trustee may acquire the same using its
best efforts. Unless otherwise expressly provided in this Trust Indenture,
any income realized as a result of any such investment, net of the Indenture
Trustee's reasonable fees and expenses in making such investment, shall be
held and applied by the Indenture Trustee in the same manner as the principal
amount of such investment is to be applied and any losses, net of earnings
and such reasonable fees and expenses, shall be charged against the principal
amount invested. The Indenture Trustee shall not be liable for any loss
resulting from any investment required to be made by it under this Trust
Indenture other than by reason of its willful misconduct or gross negligence,
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and any such investment may be sold (without regard to its maturity) by the
Indenture Trustee without instructions whenever such sale is necessary to
make a distribution required by this Trust Indenture. Any investment
permitted under Section 22(a) of the Lease or hereunder may be made through
or with, as applicable, the entity acting as Indenture Trustee or its
Affiliates.
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties.
The Indenture Trustee accepts the duties hereby created and
applicable to it and agrees to perform the same but only upon the terms of
this Trust Indenture and agrees to receive and disburse all monies
constituting part of the Trust Indenture Estate in accordance with the terms
hereof. The Owner Trustee, in its individual capacity, and the Indenture
Trustee, in its individual capacity, shall not be answerable or accountable
under any circumstances, except (i) for their own willful misconduct or gross
negligence (other than for the handling of funds, for which the standard of
accountability shall be willful misconduct or negligence), (ii) in the case
of the Indenture Trustee, as provided in the fourth sentence of Section
2.04(a) hereof and the last sentence of Section 5.04 hereof, and (iii) for
liabilities that may result, in the case of the Owner Trustee, from the
inaccuracy of any representation or warranty of the Owner Trustee expressly
made in its individual capacity in the Participation Agreement or in Section
4.01(b) or 6.03 hereof (or in any certificate furnished to the Indenture
Trustee or any Certificate Holder in connection with the transactions
contemplated by the Operative Documents) or, in the case of the Indenture
Trustee (in its individual capacity), from the inaccuracy of any
representation or warranty of the Indenture Trustee (in its individual
capacity) in the Participation Agreement or expressly made hereunder.
Neither the Owner Trustee nor the Indenture Trustee shall be liable for any
action or inaction of the other or of the Owner Participant.
SECTION 6.02. Absence of Duties.
In the case of the Indenture Trustee, except in accordance
with written instructions furnished pursuant to Section 5.01 or 5.02 hereof,
and except as provided in, and without limiting the generality of, Sections
5.03 and 5.04 hereof and, in the case of the Owner Trustee, except as
provided in Section 4.01(b) hereof, the Owner Trustee and the Indenture
Trustee shall have no duty (i) to see to any registration of the Aircraft or
any recording or filing of the Lease or of this Trust Indenture or any other
document, or to see to the maintenance of any such registration, recording or
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filing, (ii) to see to any insurance on the Aircraft or to effect or maintain
any such insurance, whether or not Lessee shall be in default with respect
thereto, (iii) to see to the payment or discharge of any lien or encumbrance
of any kind against any part of the Trust Estate or the Trust Indenture
Estate, (iv) to confirm, verify or inquire into the failure to receive any
financial statements from Lessee, or (v) to inspect the Aircraft at any time
or ascertain or inquire as to the performance or observance of any of
Lessee's covenants under the Lease with respect to the Aircraft. The Owner
Participant shall not have any duty or responsibility hereunder, including,
without limitation, any of the duties mentioned in clauses (i) through (v)
above; provided, that nothing contained in this sentence shall limit any
obligations of the Owner Participant under the Participation Agreement or
relieve the Owner Participant from any restriction under Section 4.03 hereof.
SECTION 6.03. No Representations or Warranties as to
Aircraft or Documents.
NEITHER THE INDENTURE TRUSTEE IN ITS INDIVIDUAL OR TRUST
CAPACITY NOR THE OWNER TRUSTEE IN ITS INDIVIDUAL CAPACITY OR AS OWNER TRUSTEE
UNDER THE TRUST AGREEMENT, NOR THE OWNER PARTICIPANT MAKES OR SHALL BE DEEMED
TO HAVE MADE AND EACH HEREBY EXPRESSLY DISCLAIMS ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS, VALUE,
COMPLIANCE WITH SPECIFICATIONS, CONDITION, DESIGN, QUALITY, DURABILITY,
OPERATION, MERCHANTABILITY OR FITNESS FOR USE FOR A PARTICULAR PURPOSE OF THE
AIRCRAFT OR ANY ENGINE, AS TO THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER
OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT,
TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF OBLIGATIONS BASED ON STRICT
LIABILITY IN TORT OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER, except
the Owner Trustee in its individual capacity warrants that (i) the Owner
Trustee has received on the Delivery Date whatever title was conveyed to it
by Lessee, and (ii) the Aircraft is free and clear of Lessor Liens (including
for this purpose Liens which would be Lessor Liens but for the proviso in the
definition of Lessor Liens) attributable to the Owner Trustee in its
individual capacity. Neither the Owner Trustee, in its individual capacity
or as Owner Trustee under the Trust Agreement, nor the Indenture Trustee, in
its individual or trust capacities, makes or shall be deemed to have made any
representation or warranty as to the validity, legality or enforceability of
this Trust Indenture, the Trust Agreement, the Participation Agreement, the
Secured Certificates, the Lease, the Purchase Agreement, the Purchase
Agreement Assignment, the Consent and Agreement or the Guarantee, or as to
the correctness of any statement contained in any thereof, except for the
representations and warranties of the Owner Trustee made in its individual
capacity and the representations and warranties of the Indenture Trustee, in
each case expressly made in this Trust Indenture or in the Participation
Agreement. The Loan Participants, the Certificate Holders and the Owner
Participant make no representation or warranty hereunder whatsoever.
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SECTION 6.04. No Segregation of Monies; No Interest.
Any monies paid to or retained by the Indenture Trustee
pursuant to any provision hereof and not then required to be distributed to
the Certificate Holders, Lessee or the Owner Trustee as provided in Article
III hereof need not be segregated in any manner except to the extent required
by Law or Section 10(f) or 11(g) of the Lease and Section 5.09 hereof, and
may be deposited under such general conditions as may be prescribed by Law,
and the Indenture Trustee shall not be liable for any interest thereon
(except that the Indenture Trustee shall invest all monies held as directed
by Lessee so long as no Lease Event of Default or Lease Default has occurred
and is continuing (or in the absence of such direction, by the Majority In
Interest of Certificate Holders) in Cash Equivalents; provided, however, that
any payments received, or applied hereunder, by the Indenture Trustee shall
be accounted for by the Indenture Trustee so that any portion thereof paid or
applied pursuant hereto shall be identifiable as to the source thereof.
SECTION 6.05. Reliance; Agreements; Advice of Counsel.
Neither the Owner Trustee nor the Indenture Trustee shall
incur any liability to anyone in acting upon any signature, instrument,
notice, resolution, request, consent, order, certificate, report, opinion,
bond or other document or paper believed by it to be genuine and believed by
it to be signed by the proper party or parties. The Owner Trustee and the
Indenture Trustee may accept a copy of a resolution of the Board of Directors
(or, in the case of the Owner Participant which originally executed the
Participation Agreement, evidence of the approval by the Executive Committee
thereof) of any party to the Participation Agreement, certified by the
Secretary or an Assistant Secretary thereof as duly adopted and in full force
and effect, as conclusive evidence that such resolution has been duly adopted
and that the same is in full force and effect. As to the aggregate unpaid
Principal Amount of Secured Certificates outstanding as of any date, the
Owner Trustee may for all purposes hereof rely on a certificate signed by any
Vice President or other authorized corporate trust officer of the Indenture
Trustee. As to any fact or matter relating to Lessee the manner of
ascertainment of which is not specifically described herein, the Owner
Trustee and the Indenture Trustee may for all purposes hereof rely on a
certificate, signed by a duly authorized officer of Lessee, as to such fact
or matter, and such certificate shall constitute full protection to the Owner
Trustee and the Indenture Trustee for any action taken or omitted to be taken
by them in good faith in reliance thereon. The Indenture Trustee shall
assume, and shall be fully protected in assuming, that the Owner Trustee is
authorized by the Trust Agreement to enter into this Trust Indenture and to
take all action to be taken by it pursuant to the provisions hereof, and
shall not inquire into the authorization of the Owner Trustee with respect
thereto. In the administration of the trusts hereunder, the Owner Trustee
and the Indenture Trustee each may execute any of the trusts or powers hereof
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and perform its powers and duties hereunder directly or through agents or
attorneys and may at the expense of the Trust Indenture Estate, consult with
counsel, accountants and other skilled persons to be selected and retained by
it, and the Owner Trustee and the Indenture Trustee shall not be liable for
anything done, suffered or omitted in good faith by them in accordance with
the written advice or written opinion of any such counsel, accountants or
other skilled persons.
SECTION 6.06. Capacity in Which Acting.
The Owner Trustee acts hereunder solely as trustee as herein
and in the Trust Agreement provided, and not in its individual capacity,
except as otherwise expressly provided herein, in the Trust Agreement and in
the Participation Agreement.
SECTION 6.07. Compensation.
The Indenture Trustee shall be entitled to reasonable
compensation, including expenses and disbursements (including the reasonable
fees and expenses of counsel), for all services rendered hereunder and shall,
on and subsequent to an Event of Default hereunder, have a priority claim on
the Trust Indenture Estate for the payment of such compensation, to the
extent that such compensation shall not be paid by Lessee, and shall have the
right, on and subsequent to an Event of Default hereunder, to use or apply
any monies held by it hereunder in the Trust Indenture Estate toward such
payments. The Indenture Trustee agrees that it shall have no right against
the Loan Participants, the Certificate Holders, the Owner Trustee or the
Owner Participant for any fee as compensation for its services as trustee
under this Trust Indenture.
SECTION 6.08. Instructions from Certificate Holders.
In the administration of the trusts created hereunder, the
Indenture Trustee shall have the right to seek instructions from a Majority
in Interest of Certificate Holders should any provision of this Trust
Indenture appear to conflict with any other provision herein or should the
Indenture Trustee's duties or obligations hereunder be unclear, and the
Indenture Trustee shall incur no liability in refraining from acting until it
receives such instructions. The Indenture Trustee shall be fully protected
for acting in accordance with any instructions received under this Section
6.08.
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ARTICLE VII
INDEMNIFICATION OF THE INDENTURE TRUSTEE BY THE OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification.
The Owner Trustee, not in its individual capacity, but
solely as Owner Trustee, hereby agrees, except as otherwise provided in
Section 2.03 hereof, to assume liability for, and does hereby indemnify,
protect, save and keep harmless the Indenture Trustee (in its individual and
trust capacities), and its successors, assigns, agents and servants, from and
against any and all liabilities, obligations, losses, damages, penalties,
taxes (excluding any taxes payable by the Indenture Trustee on or measured by
any compensation received by the Indenture Trustee for its services under
this Trust Indenture), claims, actions, suits, costs, expenses or
disbursements (including reasonable legal fees and expenses) of any kind and
nature whatsoever, which may be imposed on, incurred by or asserted against
the Indenture Trustee (whether or not also indemnified against by any other
Person under any other document) in any way relating to or arising out of
this Trust Indenture or any other Operative Document to which it is a party
or the enforcement of any of the terms of any thereof, or in any way relating
to or arising out of the manufacture, purchase, acceptance, non-acceptance,
rejection, ownership, delivery, lease, possession, use, operation, condition,
sale, return or other disposition of the Aircraft or any Engine (including,
without limitation, latent or other defects, whether or not discoverable, and
any claim for patent, trademark or copyright infringement), or in any way
relating to or arising out of the administration of the Trust Indenture
Estate or the action or inaction of the Indenture Trustee hereunder, to the
extent not reimbursed by Lessee. Without limiting the foregoing, the
Indenture Trustee agrees that, prior to seeking indemnification from the
Trust Indenture Estate, it will demand, and take such action as it may in its
discretion determine to be reasonable to pursue, indemnification available to
the Indenture Trustee under the Lease or the Participation Agreement.
Notwithstanding the foregoing, the Indenture Trustee shall not be entitled to
any indemnification for any Taxes or Expenses to the extent relating to or
arising from the willful misconduct or gross negligence (or negligence in the
case of handling funds) of the Indenture Trustee in the performance of its
duties hereunder or resulting from the inaccuracy of any representation or
warranty of the Indenture Trustee (in its individual capacity) referred to in
Section 6.03 hereof, or as provided in Section 6.01 hereof or in the last
sentence of Section 5.04 hereof, or as otherwise excluded by the terms of
Sections 7(b) and 7(c) of the Participation Agreement from Lessee's
indemnities under such Sections. In addition, if necessary, the Indenture
Trustee shall be entitled to indemnification from the Trust Indenture Estate
for any liability, obligation, loss, damage, penalty, claim, action, suit,
cost, expense or disbursement indemnified against pursuant to this Section
7.01 to the extent not reimbursed by Lessee or others, but without releasing
any of them from their respective agreements of reimbursement; and to secure
the same the Indenture Trustee shall have a prior Lien on the Trust Indenture
Estate. The Owner Trustee shall be subrogated to the Indenture Trustee's
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rights, if any, to any indemnity payment from Lessee for the amounts paid by
the Owner Trustee under this Section 7.01.
ARTICLE VIII
SUCCESSOR AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee.
In the case of any appointment of a successor to the Owner
Trustee pursuant to the Trust Agreement including upon any merger,
conversion, consolidation or sale of substantially all of the corporate trust
business of the Owner Trustee pursuant to the Trust Agreement, the successor
Owner Trustee shall give prompt written notice thereof to the Indenture
Trustee, Lessee and the Certificate Holders.
SECTION 8.02. Resignation of Indenture Trustee; Appointment
of Successor.
(a) The Indenture Trustee or any successor thereto may
resign at any time without cause by giving at least 30 days' prior written
notice to Lessee, the Owner Trustee, the Owner Participant and each
Certificate Holder, such resignation to be effective upon the acceptance of
the trusteeship by a successor Indenture Trustee. In addition, a Majority in
Interest of Certificate Holders may at any time (but only with the consent of
Lessee, which consent shall not be unreasonably withheld, except that such
consent shall not be necessary if a Lease Event of Default is continuing)
remove the Indenture Trustee without cause by an instrument in writing
delivered to the Owner Trustee, Lessee, the Owner Participant and the
Indenture Trustee, and the Indenture Trustee shall promptly notify each
Certificate Holder thereof in writing, such removal to be effective upon the
acceptance of the trusteeship by a successor Indenture Trustee. In the case
of the resignation or removal of the Indenture Trustee, a Majority in
Interest of Certificate Holders may appoint a successor Indenture Trustee by
an instrument signed by such holders, which successor, so long as no Lease
Event of Default shall have occurred and be continuing, shall be subject to
Lessee's reasonable approval. If a successor Indenture Trustee shall not
have been appointed within 30 days after such notice of resignation or
removal, the Indenture Trustee, the Owner Trustee, the Owner Participant or
any Certificate Holder may apply to any court of competent jurisdiction to
appoint a successor Indenture Trustee to act until such time, if any, as a
successor shall have been appointed as above provided. The successor
Indenture Trustee so appointed by such court shall immediately and without
further act be superseded by any successor Indenture Trustee appointed as
above provided.
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(b) Any successor Indenture Trustee, however appointed,
shall execute and deliver to the Owner Trustee, the predecessor Indenture
Trustee and Lessee an instrument accepting such appointment and assuming the
obligations of the Indenture Trustee under the Participation Agreement
arising from and after the time of such appointment, and thereupon such
successor Indenture Trustee, without further act, shall become vested with
all the estates, properties, rights, powers and duties of the predecessor
Indenture Trustee hereunder in the trust hereunder applicable to it with like
effect as if originally named the Indenture Trustee herein; but nevertheless
upon the written request of such successor Indenture Trustee, such
predecessor Indenture Trustee shall execute and deliver an instrument
transferring to such successor Indenture Trustee, upon the trusts herein
expressed applicable to it, all the estates, properties, rights and powers of
such predecessor Indenture Trustee, and such predecessor Indenture Trustee
shall duly assign, transfer, deliver and pay over to such successor Indenture
Trustee all monies or other property then held by such predecessor Indenture
Trustee hereunder.
(c) Any successor Indenture Trustee, however appointed,
shall be a bank or trust company having its principal place of business in
the Borough of Manhattan, City and State of New York; Minneapolis, Minnesota;
Chicago, Illinois; Hartford, Connecticut; Wilmington, Delaware; or Boston,
Massachusetts and having (or whose obligations under the Operative Documents
are guaranteed by an affiliated entity having) a combined capital and surplus
of at least $100,000,000, if there be such an institution willing, able and
legally qualified to perform the duties of the Indenture Trustee hereunder
upon reasonable or customary terms.
(d) Any corporation into which the Indenture Trustee may
be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which
the Indenture Trustee shall be a party, or any corporation to which
substantially all the corporate trust business of the Indenture Trustee may
be transferred, shall, subject to the terms of paragraph (c) of this Section
8.02, be a successor Indenture Trustee and the Indenture Trustee under this
Trust Indenture without further act.
SECTION 8.03. Appointment of Additional and Separate
Trustees.
(a) Whenever (i) the Indenture Trustee shall deem it
necessary or desirable in order to conform to any law of any jurisdiction in
which all or any part of the Trust Indenture Estate shall be situated or to
make any claim or bring any suit with respect to or in connection with the
Trust Indenture Estate, this Trust Indenture, any other Indenture Agreement,
the Secured Certificates or any of the transactions contemplated by the
Participation Agreement, (ii) the Indenture Trustee shall be advised by
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counsel satisfactory to it that it is so necessary or prudent in the
interests of the Certificate Holders (and the Indenture Trustee shall so
advise the Owner Trustee and Lessee), or (iii) the Indenture Trustee shall
have been requested to do so by a Majority in Interest of Certificate
Holders, then in any such case, the Indenture Trustee and, upon the written
request of the Indenture Trustee, the Owner Trustee, shall execute and
deliver an indenture supplemental hereto and such other instruments as may
from time to time be necessary or advisable either (1) to constitute one or
more bank or trust companies or one or more persons approved by the Indenture
Trustee, either to act jointly with the Indenture Trustee as additional
trustee or trustees of all or any part of the Trust Indenture Estate, or to
act as separate trustee or trustees of all or any part of the Trust Indenture
Estate, in each case with such rights, powers, duties and obligations
consistent with this Trust Indenture as may be provided in such supplemental
indenture or other instruments as the Indenture Trustee or a Majority in
Interest of Certificate Holders may deem necessary or advisable, or (2) to
clarify, add to or subtract from the rights, powers, duties and obligations
theretofore granted any such additional and separate trustee, subject in each
case to the remaining provisions of this Section 8.03. If the Owner Trustee
shall not have taken any action requested of it under this Section 8.03(a)
that is permitted or required by its terms within 15 days after the receipt
of a written request from the Indenture Trustee so to do, or if an Event of
Default shall have occurred and be continuing, the Indenture Trustee may act
under the foregoing provisions of this Section 8.03(a) without the
concurrence of the Owner Trustee; and the Owner Trustee hereby irrevocably
appoints (which appointment is coupled with an interest) the Indenture
Trustee, its agent and attorney-in-fact to act for it under the foregoing
provisions of this Section 8.03(a) in either of such contingencies. The
Indenture Trustee may, in such capacity, execute, deliver and perform any
such supplemental indenture, or any such instrument, as may be required for
the appointment of any such additional or separate trustee or for the
clarification of, addition to or subtraction from the rights, powers, duties
or obligations theretofore granted to any such additional or separate
trustee. In case any additional or separate trustee appointed under this
Section 8.03(a) shall die, become incapable of acting, resign or be removed,
all the assets, property, rights, powers, trusts, duties and obligations of
such additional or separate trustee shall revert to the Indenture Trustee
until a successor additional or separate trustee is appointed as provided in
this Section 8.03(a).
(b) No additional or separate trustee shall be entitled
to exercise any of the rights, powers, duties and obligations conferred upon
the Indenture Trustee in respect of the custody, investment and payment of
monies and all monies received by any such additional or separate trustee
from or constituting part of the Trust Indenture Estate or otherwise payable
under any Operative Document to the Indenture Trustee shall be promptly paid
over by it to the Indenture Trustee. All other rights, powers, duties and
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obligations conferred or imposed upon any additional or separate trustee
shall be exercised or performed by the Indenture Trustee and such additional
or separate trustee jointly except to the extent that applicable Law of any
jurisdiction in which any particular act is to be performed renders the
Indenture Trustee incompetent or unqualified to perform such act, in which
event such rights, powers, duties and obligations (including the holding of
title to all or part of the Trust Indenture Estate in any such jurisdiction)
shall be exercised and performed by such additional or separate trustee. No
additional or separate trustee shall take any discretionary action except on
the instructions of the Indenture Trustee or a Majority in Interest of
Certificate Holders. No trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder, except that the
Indenture Trustee shall be liable for the consequences of its lack of
reasonable care in selecting, and Indenture Trustee's own actions in acting
with, any additional or separate trustee. Each additional or separate
trustee appointed pursuant to this Section 8.03 shall be subject to, and
shall have the benefit of Articles IV through VIII and Article X hereof
insofar as they apply to the Indenture Trustee. The powers of any additional
or separate trustee appointed pursuant to this Section 8.03 shall not in any
case exceed those of the Indenture Trustee hereunder.
(c) If at any time the Indenture Trustee shall deem it
no longer necessary or desirable in order to conform to any such law or take
any such action or shall be advised by such counsel that it is no longer so
necessary or desirable in the interest of the Certificate Holders, or in the
event that the Indenture Trustee shall have been requested to do so in
writing by a Majority in Interest of Certificate Holders, the Indenture
Trustee and, upon the written request of the Indenture Trustee, the Owner
Trustee, shall execute and deliver an indenture supplemental hereto and all
other instruments and agreements necessary or proper to remove any additional
or separate trustee. The Indenture Trustee may act on behalf of the Owner
Trustee under this Section 8.03(c) when and to the extent it could so act
under Section 8.03(a) hereof.
ARTICLE IX
SUPPLEMENT AND AMENDMENTS TO THIS TRUST INDENTURE
AND OTHER DOCUMENTS
SECTION 9.01. Instructions of Majority; Limitations.
(a) Except as provided in Section 5.02 hereof, and
except with respect to Excluded Payments, the Owner Trustee agrees it shall
not enter into any amendment of or supplement to the Lease, the Purchase
Agreement, the Purchase Agreement Assignment, the Consent and Agreement or
the Guarantee, or execute and deliver any written waiver or modification of,
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or consent under, the terms of the Lease, the Purchase Agreement, the
Purchase Agreement Assignment, the Consent and Agreement or the Guarantee,
unless such supplement, amendment, waiver, modification or consent is
consented to in writing by the Indenture Trustee and a Majority in Interest
of Certificate Holders. Anything to the contrary contained herein
notwithstanding, without the necessity of the consent of any of the
Certificate Holders or the Indenture Trustee, (i) any Excluded Payments
payable to the Owner Participant may be modified, amended, changed or waived
in such manner as shall be agreed to by the Owner Participant and Lessee and
(ii) the Owner Trustee and Lessee may enter into amendments of or additions
to the Lease to modify Section 5 (except to the extent that such amendment
would affect the rights or exercise of remedies under Section 15 of the
Lease), Section 9 or Section 19 of the Lease so long as such amendments,
modifications and changes do not and would not affect the time of, or reduce
the amount of, Rent payments until after the payment in full of all Secured
Obligations or otherwise adversely affect the Certificate Holders.
(b) Without limiting the provisions of Section 9.01(a)
hereof and subject to Section 5.02(a)(2)(i) hereof, the Indenture Trustee
agrees with the Certificate Holders that it shall not enter into any
amendment, waiver or modification of, supplement or consent to this Trust
Indenture, the Lease, the Purchase Agreement, the Purchase Agreement
Assignment, the Consent and Agreement, the Guarantee or the Participation
Agreement, or any other agreement included in the Trust Indenture Estate,
unless such supplement, amendment, waiver, modification or consent is
consented to in writing by a Majority in Interest of Certificate Holders, or
does not adversely affect the Certificate Holders, but upon the written
request of a Majority in Interest of Certificate Holders, the Indenture
Trustee shall from time to time enter into any such supplement or amendment,
or execute and deliver any such waiver, modification or consent, as may be
specified in such request and as may be (in the case of any such amendment,
supplement or modification), to the extent such agreement is required, agreed
to by the Owner Trustee and Lessee or, as may be appropriate, the
Manufacturer; provided, however, that, without the consent of each holder of
an affected Secured Certificate then outstanding, no such amendment of or
supplement to this Trust Indenture, the Lease, the Purchase Agreement, the
Purchase Agreement Assignment, the Consent and Agreement, the Guarantee or
the Participation Agreement or waiver or modification of the terms of, or
consent under, any thereof, shall (i) modify any of the provisions of this
Section 9.01, or of Sections 2.02, 2.10, 2.11, 2.15, 4.02, 4.04(c), 4.04(d),
5.02 or 5.06 hereof, Section 14 (except to add an Event of Default) of the
Lease, the definitions of "Event of Default", "Default", "Lease Event of
Default", "Lease Default", "Majority in Interest of Certificate Holders",
"Make-Whole Amount" or "Certificate Holder", or the percentage of Certificate
Holders required to take or approve any action hereunder, (ii) reduce the
amount, or change the time of payment or method of calculation of any amount,
of Principal Amount, Make-Whole Amount, if any, or interest with respect to
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any Secured Certificate, or alter or modify the provisions of Article III
hereof with respect to the order of priorities in which distribution
thereunder shall be made as among the Certificate Holders, the Owner Trustee
and Lessee, (iii) reduce, modify or amend any indemnities in favor of the
Certificate Holders, (iv) consent to any change in the Trust Indenture or the
Lease which would permit redemption of Secured Certificates earlier than
permitted under Section 2.10 or 2.11 hereof or the purchase of the Secured
Certificates other than as permitted by Section 2.14 hereof, (v) modify any
of the provisions of Section 3(d)(v) of the Lease, or modify, amend or
supplement the Lease or consent to any assignment of the Lease, in either
case releasing Lessee from its obligations in respect of the payment of Basic
Rent, Stipulated Loss Value or Termination Value for the Aircraft or altering
the absolute and unconditional character of the obligations of Lessee to pay
Rent as set forth in Sections 3 and 18 of the Lease or (vi) permit the
creation of any Lien on the Trust Indenture Estate or any part thereof other
than Permitted Liens or deprive any Certificate Holder of the benefit of the
Lien of this Trust Indenture on the Trust Indenture Estate, except as
provided in connection with the exercise of remedies under Article IV hereof.
So long as no Lease Event of Default has occurred and is continuing, without
the consent of Lessee no amendment or supplement to this Trust Indenture or
waiver or modification of the terms hereof shall adversely affect Lessee.
(c) At any time after the date hereof, the Owner Trustee
and the Indenture Trustee may enter into one or more agreements supplemental
hereto without the consent of any Certificate Holder for any of the following
purposes: (i) (a) to cure any defect or inconsistency herein or in the
Secured Certificates, or to make any change not inconsistent with the
provisions hereof (provided that such change does not adversely affect the
interests of any Certificate Holder in its capacity solely as Certificate
Holder) or (b) to cure any ambiguity or correct any mistake; (ii) to evidence
the succession of another party as the Owner Trustee in accordance with the
terms of the Trust Agreement or to evidence the succession of a new trustee
hereunder pursuant hereto, the removal of the trustee hereunder or the
appointment of any co-trustee or co-trustees or any separate or additional
trustee or trustees; (iii) to convey, transfer, assign, mortgage or pledge
any property to or with the Indenture Trustee or to make any other provisions
with respect to matters or questions arising hereunder so long as such action
shall not adversely affect the interests of the Certificate Holders in its
capacity solely as Certificate Holder; (iv) to correct or amplify the
description of any property at any time subject to the Lien of this Trust
Indenture or better to assure, convey and confirm unto the Indenture Trustee
any property subject or required to be subject to the Lien of this Trust
Indenture, the Airframe or Engines or any Replacement Airframe or Replacement
Engine; (v) to add to the covenants of the Owner Trustee for the benefit of
the Certificate Holders, or to surrender any rights or power herein conferred
upon the Owner Trustee, the Owner Participant or Lessee; (vi) to add to the
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rights of the Certificate Holders; and (vii) to include on the Secured
Certificates any legend as may be required by law.
SECTION 9.02. Trustees Protected.
If, in the opinion of the institution acting as Owner
Trustee under the Trust Agreement or the institution acting as Indenture
Trustee hereunder, any document required to be executed by it pursuant to the
terms of Section 9.01 hereof adversely affects any right, duty, immunity or
indemnity with respect to such institution under this Trust Indenture or the
Lease, such institution may in its discretion decline to execute such
document.
SECTION 9.03. Documents Mailed to Certificate Holders.
Promptly after the execution by the Owner Trustee or the
Indenture Trustee of any document entered into pursuant to Section 9.01
hereof, the Indenture Trustee shall mail, by first class mail, postage
prepaid, a copy thereof to Lessee and to each Certificate Holder at its
address last set forth in the Secured Certificate Register, but the failure
of the Indenture Trustee to mail such copies shall not impair or affect the
validity of such document.
SECTION 9.04. No Request Necessary for Lease Supplement or
Trust Agreement and Indenture Supplement.
No written request or consent of the Indenture Trustee, the
Certificate Holders or the Owner Participant pursuant to Section 9.01 hereof
shall be required to enable the Owner Trustee to enter into any Lease
Supplement specifically required by the terms of the Lease or to execute and
deliver a Trust Agreement and Indenture Supplement specifically required by
the terms hereof.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Trust Indenture.
Upon (or at any time after) payment in full of the Principal
Amount of, Make-Whole Amount, if any, and interest on and all other amounts
due under all Secured Certificates and provided that there shall then be no
other Secured Obligations due to the Certificate Holders and the Indenture
Trustee hereunder or under the Participation Agreement, the Owner Trustee
shall direct the Indenture Trustee to execute and deliver to or as directed
in writing by the Owner Trustee an appropriate instrument releasing the
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Aircraft and the Engines from the Lien of this Trust Indenture and releasing
the Lease, the Purchase Agreement, the Purchase Agreement Assignment with the
Consent and Agreement attached thereto and the Guarantee from the assignment
and pledge thereof hereunder and the Indenture Trustee shall execute and
deliver such instrument as aforesaid and give written notice thereof to
Lessee; provided, however, that this Trust Indenture and the trusts created
hereby shall earlier terminate and this Trust Indenture shall be of no
further force or effect upon any sale or other final disposition by the
Indenture Trustee of all property constituting part of the Trust Indenture
Estate and the final distribution by the Indenture Trustee of all monies or
other property or proceeds constituting part of the Trust Indenture Estate in
accordance with the terms hereof. Except as aforesaid otherwise provided,
this Trust Indenture and the trusts created hereby shall continue in full
force and effect in accordance with the terms hereof.
SECTION 10.02. No Legal Title to Trust Indenture Estate in
Certificate Holders.
No holder of a Secured Certificate shall have legal title to
any part of the Trust Indenture Estate. No transfer, by operation of law or
otherwise, of any Secured Certificate or other right, title and interest of
any Certificate Holder in and to the Trust Indenture Estate or hereunder
shall operate to terminate this Trust Indenture or entitle such holder or any
successor or transferee of such holder to an accounting or to the transfer to
it of any legal title to any part of the Trust Indenture Estate.
SECTION 10.03. Sale of Aircraft by Indenture Trustee Is
Binding.
Any sale or other conveyance of the Trust Indenture Estate,
or any part thereof (including any part thereof or interest therein), by the
Indenture Trustee made pursuant to the terms of this Trust Indenture shall
bind the Certificate Holders and shall be effective to transfer or convey all
right, title and interest of the Indenture Trustee, the Owner Trustee, the
Owner Participant and such holders in and to such Trust Indenture Estate or
part thereof. No purchaser or other grantee shall be required to inquire as
to the authorization, necessity, expediency or regularity of such sale or
conveyance or as to the application of any sale or other proceeds with
respect thereto by the Indenture Trustee.
SECTION 10.04. Trust Indenture for Benefit of the Owner
Trustee, the Indenture Trustee, Owner Participant, Lessee and Certificate
Holders.
Nothing in this Trust Indenture, whether express or implied,
shall be construed to give any person other than the Owner Trustee, the
Indenture Trustee, the Owner Participant, Lessee and the Certificate Holders,
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any legal or equitable right, remedy or claim under or in respect of this
Trust Indenture.
SECTION 10.05. Notices.
Unless otherwise expressly specified or permitted by the
terms hereof, all notices, requests, demands, authorizations, directions,
consents, waivers or documents provided or permitted by this Trust Indenture
to be made, given, furnished or filed shall be in writing, personally
delivered or mailed by certified mail, postage prepaid, or by facsimile or
confirmed telex, and (i) if to the Owner Trustee, addressed to it at its
office at 00 Xxxxx Xxxx Xxxxxx, Xxxx Xxxx Xxxx, Xxxx 00000, Attention:
Corporate Trust Department (Telecopy No. (000) 000-0000), with a copy to the
Owner Participant addressed as provided in clause (iii) below, (ii) if to the
Indenture Trustee, addressed to it at its office at, for U.S. mail at
Corporate Trust Department, X.X. Xxx 000, Xxxxxx, Xxxxxxxxxxxxx 00000-0000,
and for overnight courier at Corporate Trust Department, 0 Xxxxxx xx
Xxxxxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000-0000 (Telecopy No. (000) 000-0000),
(iii) if to any Participant, Lessee or any Certificate Holder, addressed to
such party at such address as such party shall have furnished by notice to
the Owner Trustee and the Indenture Trustee, or, until an address is so
furnished, addressed to the address of such party (if any) set forth on the
signature pages to the Participation Agreement or in the Secured Certificate
Register. Whenever any notice in writing is required to be given by the
Owner Trustee, any Participant or the Indenture Trustee or any Certificate
Holder or Lessee to any of the other of them, such notice shall be deemed
given and such requirement satisfied when such notice is received, or if such
notice is mailed by certified mail, postage prepaid, three Business Days
after being mailed, addressed as provided above. Any party hereto may change
the address to which notices to such party will be sent by giving notice of
such change to the other parties to this Trust Indenture.
SECTION 10.06. Severability.
Any provision of this Trust Indenture which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any such prohibition or
unenforceability in any particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 10.07. No Oral Modification or Continuing Waivers.
No term or provision of this Trust Indenture or the Secured
Certificates may be changed, waived, discharged or terminated orally, but
only by an instrument in writing signed by the Owner Trustee and the
Indenture Trustee, in compliance with Section 9.01 hereof. Any waiver of the
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terms hereof or of any Secured Certificate shall be effective only in the
specific instance and for the specific purpose given.
SECTION 10.08. Successors and Assigns.
All covenants and agreements contained herein shall be
binding upon, and inure to the benefit of, each of the parties hereto and the
permitted successors and assigns of each, all as herein provided. Any
request, notice, direction, consent, waiver or other instrument or action by
any Certificate Holder shall bind the successors and assigns of such holder.
This Trust Indenture and the Trust Indenture Estate shall not be affected by
any amendment or supplement to the Trust Agreement or by any other action
taken under or in respect of the Trust Agreement, except that each reference
in this Trust Indenture to the Trust Agreement shall mean the Trust Agreement
as amended and supplemented from time to time to the extent permitted hereby,
thereby and by the Participation Agreement. Each Certificate Holder by its
acceptance of a Secured Certificate agrees to be bound by this Trust
Indenture and all provisions of the Participation Agreement applicable to a
Loan Participant or a Certificate Holder.
SECTION 10.09. Headings.
The headings of the various Articles and sections herein and
in the table of contents hereto are for convenience of reference only and
shall not define or limit any of the terms or provisions hereof.
SECTION 10.10. Normal Commercial Relations.
Anything contained in this Trust Indenture to the contrary
notwithstanding, the Owner Trustee, the Indenture Trustee, any Participant or
any bank or other Affiliate of such Participant may conduct any banking or
other financial transactions, and have banking or other commercial
relationships, with Lessee, fully to the same extent as if this Trust
Indenture were not in effect, including without limitation the making of
loans or other extensions of credit to Lessee for any purpose whatsoever,
whether related to any of the transactions contemplated hereby or otherwise.
SECTION 10.11. Governing Law; Counterpart Form.
THIS TRUST INDENTURE SHALL IN ALL RESPECTS BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK,
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. THIS TRUST
INDENTURE IS BEING DELIVERED IN THE STATE OF NEW YORK. This Trust Indenture
may be executed by the parties hereto in separate counterparts (or upon
separate signature pages bound together into one or more 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.
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SECTION 10.12. Voting By Certificate Holders.
All votes of the Certificate Holders shall be governed by a
vote of a Majority in Interest of Certificate Holders, except as otherwise
provided herein.
SECTION 10.13. Bankruptcy.
It is the intention of the parties that the Owner Trustee,
as lessor under the Lease (and the Indenture Trustee as assignee of the Owner
Trustee hereunder), shall be entitled to the benefits of Section 1110 with
respect to the right to take possession of the Aircraft, Airframe, Engines
and Parts as provided in the Lease in the event of a case under Chapter 11 of
the Bankruptcy Code in which Lessee is a debtor, and in any instance where
more than one construction is possible of the terms and conditions hereof or
any other pertinent Operative Document, each such party agrees that a
construction which would preserve such benefits shall control over any
construction which would not preserve such benefits.
SECTION 10.14. No Action Contrary to Lessee's Rights Under
the Lease.
Notwithstanding any of the provisions of this Trust
Indenture or the Trust Agreement to the contrary, neither the Indenture
Trustee nor the Owner Trustee will take any action contrary to Lessee's
rights under the Lease, including the right to possession and use of, and the
quiet enjoyment of, the Aircraft, except in accordance with provisions of the
Lease.
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IN WITNESS WHEREOF, the parties hereto have caused this
Trust Indenture to be duly executed by their respective officers thereof duly
authorized as of the day and year first above written.
FIRST SECURITY BANK,
NATIONAL ASSOCIATION, not in its individual
capacity, except as expressly provided
herein, but solely as Owner Trustee,
Owner Trustee
By:________________________________________
Name:
Title:
STATE STREET BANK AND TRUST
COMPANY, not in its individual capacity,
except as expressly provided herein, but
solely as Indenture Trustee, Indenture
Trustee
By:________________________________________
Name:
Title:
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EXHIBIT A
TO
TRUST INDENTURE
AND SECURITY
AGREEMENT
TRUST INDENTURE SUPPLEMENT
[NW ____ _]
This TRUST INDENTURE SUPPLEMENT [NW ____ _], dated
[___________] (herein called this "Trust Indenture Supplement") of FIRST
SECURITY BANK, NATIONAL ASSOCIATION, not in its individual capacity, but
solely as Owner Trustee (herein called the "Owner Trustee") under that
certain Trust Agreement [NW ____ _] dated as of [_______________] (the "Trust
Agreement"), between the Owner Trustee and the Owner Participant named
therein.
W I T N E S S E T H:
WHEREAS, the TRUST INDENTURE AND SECURITY AGREEMENT [NW ____
_], dated as of [_______________] (as amended and supplemented to the date
hereof, the "Trust Indenture") between the Owner Trustee and STATE STREET
BANK AND TRUST COMPANY, as Indenture Trustee (the "Indenture Trustee"),
provides for the execution and delivery of a supplement thereto substantially
in the form hereof, which shall particularly describe the Aircraft, and shall
specifically mortgage such Aircraft to the Indenture Trustee; and
WHEREAS, the Trust Indenture relates to the Airframe and
Engines described below, and a counterpart of the Trust Indenture is attached
hereto and made a part hereof and this Trust Indenture Supplement, together
with such counterpart of the Trust Indenture, is being filed for recordation
on the date hereof with the FAA as one document;
NOW, THEREFORE, this Trust Indenture Supplement witnesseth
that the Owner Trustee hereby confirms that the Lien of the Trust Indenture
on the Trust Indenture Estate covers all of the Owner Trustee's right, title
and interest in and to the following described property:
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AIRFRAME
One airframe identified as follows:
FAA
Registration Manufacturer's
Manufacturer Model Number Serial Number
together with all of the Owner Trustee's right, title and interest in and to
all Parts of whatever nature, whether now owned or hereinafter acquired and
which are from time to time incorporated or installed in or attached to said
airframe.
AIRCRAFT ENGINES
Two aircraft engines, each such engine having 750 or more
rated take-off horsepower or the equivalent thereof, identified as follows:
Manufacturer Manufacturer's Model Serial Number
together with all of the Owner Trustee's right, title and interest in and to
all Parts of whatever nature, whether now owned or hereafter acquired and
which are from time to time incorporated or installed in or attached to any
of such engines.
Together with all of the Owner Trustee's right, title and
interest in and to all Parts of whatever nature, which from time to time are
included within the definition of "Airframe" or "Engine", whether now owned
or hereafter acquired, including all substitutions, renewals and replacements
of and additions, improvements, accessions and accumulations to the Airframe
and Engines (other than additions, improvements, accessions and accumulations
which constitute appliances, parts, instruments, appurtenances, accessories,
furnishings or other equipment excluded from the definition of Parts).
As further security for the obligations referred to above
and secured by the Trust Indenture and hereby, the Owner Trustee has granted,
bargained, sold, assigned, transferred, conveyed, mortgaged, pledged and
confirmed, and does hereby grant, bargain, sell, assign, transfer, convey,
mortgage, pledge and confirm, unto the Indenture Trustee, its successors and
assigns, for the security and benefit of the Loan Participants and of the
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Certificate Holders, in the trust created by the Trust Indenture, all of the
right, title and interest of the Owner Trustee in, to and under the Lease
Supplement [of even date herewith] covering the property described above.
Notwithstanding any provision hereof, no Excluded Payment
shall constitute security for any of the aforementioned obligations.
TO HAVE AND TO HOLD all and singular the aforesaid property
unto the Indenture Trustee, its successors and assigns, in trust for the
equal and proportionate benefit and security of the Certificate Holders,
except as provided in Section 2.15 and Article III of the Trust Indenture
without any preference, distinction or priority of any one Secured
Certificate over any other by reason of priority of time of issue, sale,
negotiation, date of maturity thereof or otherwise for any reason whatsoever,
and for the uses and purposes and subject to the terms and provisions set
forth in the Trust Indenture.
This Trust Indenture Supplement shall be construed as
supplemental to the Trust Indenture and shall form a part thereof. The Trust
Indenture is each hereby incorporated by reference herein and is hereby
ratified, approved and confirmed.
This Trust Indenture Supplement is being delivered in the
State of New York.
AND, FURTHER, the Owner Trustee hereby acknowledges that the
Aircraft referred to in this Trust Indenture Supplement and the aforesaid
Lease Supplement has been delivered to the Owner Trustee and is included in
the property of the Owner Trustee covered by all the terms and conditions of
the Trust Agreement, subject to the pledge and mortgage thereof under the
Trust Indenture.
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IN WITNESS WHEREOF, the Owner Trustee has caused this Trust
Indenture Supplement to be duly executed by one of its officers, thereunto
duly authorized, on the day and year first above written.
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual capacity, but solely
as Owner Trustee, Owner Trustee
By:________________________________________
Name:
Title:
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SCHEDULE I
Principal Amount Interest Rate
Series G. . . . . $[_________] 8.072%
.
Series C. . . . . $[_________] 9.179%
.
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Secured Certificates Amortization
SERIES G
Aircraft: N[_____]
Percentage of Principal
Payment Date Amount to be Paid
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SERIES C
Aircraft: N[_____]
Percentage of Principal
Payment Date Amount to be Paid
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SCHEDULE II
PASS THROUGH TRUST AGREEMENTS
1. Pass Through Trust Agreement, dated as of June 3, 1999 among
Northwest Airlines Corporation, Northwest Airlines, Inc., and State
Street Bank and Trust Company of Connecticut, National Association,
as supplemented by Trust Supplement No. 2000-1G, dated as of June 28,
2000 among Northwest Airlines, Inc., Northwest Airlines Corporation
and State Street Bank and Trust Company of Connecticut, National
Association.
2. Pass Through Trust Agreement, dated as of June 3, 1999, among
Northwest Airlines Corporation, Northwest Airlines, Inc., and State
Street Bank and Trust Company of Connecticut, National Association,
as supplemented by Trust Supplement No. 2000-1C, dated as of June 28,
2000 among Northwest Airlines, Inc., Northwest Airlines Corporation
and State Street Bank and Trust Company of Connecticut, National
Association.
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10.1.____________________
10.2.[FN]
To be inserted for each Secured Certificate other than any Series G
Secured Certificate.
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