AMR CORPORATION
(a Delaware corporation)
13,000,000 Shares of Common Stock
(par value $1.00 per share)
UNDERWRITING AGREEMENT
Dated: November 17, 2005
Table of Contents Page
SECTION 1. REPRESENTATIONS AND WARRANTIES 2
(a) Representations and Warranties by the Company 2
(i) Form S-3 Eligibility 2
(ii) Effective Registration Statement 2
(iii) Incorporated Documents 3
(iv) Independent Accountants 3
(v) Financial Statements 3
(vi) No Material Adverse Change in Business 3
(vii) Good Standing of the Company 3
(viii) Good Standing of Subsidiaries 4
(ix) Capitalization 4
(x) Authorization of this Agreement 5
(xi) Authorization and Description of Common Stock 5
(xii) Absence of Defaults and Conflicts 5
(xiii) Absence of Labor Dispute 5
(xiv) Absence of Further Requirements 6
(xv) Investment Company Act 6
(xvi) Environmental Laws 6
(xvii) ERISA 7
(xviii) Insurance 7
(xix) Taxes 7
(xx) Internal Controls 7
(xxi) Disclosure Controls and Procedures 8
(xxii) No Unlawful Payments 8
(xxiii) No Brokerage Commission; Finder's Fee 8
(xxiv) Dividend Payments 8
(xxv) Reporting Company 8
(xxvi) Air Carrier Certification 9
(xxvii) Possession of Licenses and Permits 9
(b) Officer's Certificates 9
SECTION 2. SALE AND DELIVERY TO UNDERWRITER; CLOSING 9
(a) Sale of Firm Shares 9
(b) Option Shares 9
(c) Payment of Purchase Price 10
(d) Denominations; Delivery of Shares 10
SECTION 3. COVENANTS OF THE COMPANY 10
SECTION 4. PAYMENT OF EXPENSES 13
(a) Expenses 13
(b) Termination of Agreement 13
SECTION 5. CONDITIONS OF THE UNDERWRITER'S OBLIGATIONS 13
(a) Opinions of Counsel for the Company 13
(b) Opinion of Counsel for the Underwriter 13
(c) Officers' Certificate 14
(d) Accountant's Comfort Letter 14
(e) No Stop Order 14
(f) Conditions to Purchase of Option Shares 14
(i) Officers' Certificate 14
(ii) Opinions of Counsel for the Company 15
(iii) Opinion of Counsel for the Underwriter 15
(iv) Bring-down Comfort Letter 15
(g) Additional Documents 15
(h) Termination of Agreement 15
SECTION 6. ACKNOWLEDGEMENTS 15
SECTION 7. INDEMNIFICATION AND CONTRIBUTION 16
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO
SURVIVE DELIVERY 19
SECTION 9. TERMINATION OF AGREEMENT. 19
(a) Termination; General 19
(b) Liabilities 20
SECTION 10. NOTICES 20
SECTION 11. [RESERVED] 20
SECTION 12. PARTIES 20
SECTION 13. NO FIDUCIARY DUTY 20
SECTION 14. GOVERNING LAW AND TIME 21
SECTION 15. EFFECT OF HEADINGS 21
SECTION 16. COUNTERPARTS 21
EXHIBITS
Exhibit A Form of Opinion of Xxxx X. Xxxxxxx, Senior Vice
President and General Counsel of the Company, to be
Delivered Pursuant to Section 5(a)
Exhibit B Form of Opinion of Debevoise & Xxxxxxxx LLP,
Counsel for the Company, to be Delivered Pursuant to
Section 5(a)
AMR CORPORATION
13,000,000 Shares Common Stock
(par value $1.00 per share)
UNDERWRITING AGREEMENT
November 17, 2005
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
AMR Corporation, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein,
to issue and sell to you (the "Underwriter") an aggregate of
13,000,000 shares (the "Firm Shares") of Common Stock, par
value $1.00 per share (the "Common Stock"), of the Company
and, at the election of the Underwriter, up to 1,950,000
additional shares (the "Option Shares") of Common Stock (the
Firm Shares and the Option Shares that the Underwriter
elects to purchase pursuant to Section 2(b) hereof being
collectively called the "Shares").
The Company has prepared and filed on Form S-3 with the
Securities and Exchange Commission (the "Commission") a
registration statement (File Nos. 333-110760 and 333-110760-
01) (including the exhibits thereto and the documents
incorporated by reference therein, the "Registration
Statement") relating to the Company's debt securities,
common stock (includ-ing the Shares) and other securities
and the offering thereof from time to time in accordance
with Rule 415 under the Securities Act of 1933, as amended
(the "Securities Act"). The Registration Statement includes
a basic prospectus referred to below which, as supplemented
from time to time, will be used in connection with offerings
of such debt securities, common stock and other securities.
As provided in Section 3(a), a prospectus supplement
describing the terms of the Shares and reflecting the terms
of the offering thereof and the other matters set forth
therein has been prepared and will be filed together with
the basic prospectus referred to below pursuant to Rule 424
under the Securities Act (such prospectus supplement, in the
form first filed on or after the date hereof pursuant to
Rule 424, is herein referred to as the "Prospectus
Supplement"). The basic prospectus included in the
Registration Statement and relating to offerings of debt
securities, common stock and other securities by the
Company under the Registration Statement, as supplemented by
the Prospectus Supplement, is herein called the
"Prospectus", except that, if such basic prospectus is
amended on or prior to the date on which the Prospectus
Supplement is first filed pursuant to Rule 424, the term
"Prospectus" shall refer to such basic prospectus as so
amended and as supplemented by the Prospectus Supplement, in
either case including the documents filed by the Company or
American Airlines, Inc. ("American") with the Commission pur-
suant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act") that are incorporated by reference
therein. The term "preliminary prospectus" means any
preliminary prospectus supplement specifically relating to
the Shares, together with the basic prospectus and includ-
ing the documents filed by the Company or American with the
Commission pursuant to the Exchange Act that are
incorporated by reference therein. Any reference herein to
the terms "amendment" or "supplement" with respect to the
Registration Statement, the Prospectus or any preliminary
prospectus shall be deemed to refer to and include any
documents filed with the Commission under the Exchange Act
after the date hereof, the date the Prospectus is filed with
the Commission, or the date of any such preliminary
prospectus, as the case may be, and incorporated therein by
reference pursuant to Item 12 of Form S-3 under the
Securities Act.
All references in this Agreement to financial statements
and schedules and other information which is "contained,"
"included," "stated" or "described" in the Prospectus (or
other references of like import) shall be deemed to mean and
include all such financial statements and schedules and
other information which are incorporated by reference in the
Prospectus; and all references in this Agreement to
amendments or supplements to the Prospectus shall be deemed
to mean and include the filing of any document under the
Exchange Act, which is incorporated by reference in the
Prospectus.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The
Company represents and warrants to the Underwriter as of the
date hereof, as follows:
(i) Form S-3 Eligibility. The Company meets the
requirements for use of Form S-3 under the Securities Act.
(ii) Effective Registration Statement. The Registration
Statement has been declared effective by the Commission. On
the effective date of the Registration Statement such
Registration Statement complied in all material respects
with the applicable requirements of the Securities Act and
the rules and regulations of the Commission thereunder (the
"Securities Act Regulations"), and did not include an untrue
statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; the Registration
Statement and any amendments thereof, on the date hereof,
and the Prospectus, and any amendments thereof and
supplements thereto, as of their respective filing or issue
dates and at the Closing Time, comply and will comply in all
material respects with the requirements of the Securities
Act and the Securities Act Regulations, and (i) neither the
Registration Statement nor any amendments thereof, as of any
such respective dates, includes or will include an untrue
statement of a material fact or omits or will omit to state
any material fact required to be stated therein or necessary
to make the statements therein not misleading and (ii)
neither the Prospectus nor any amendments thereof or
supplements thereto, as of any such respective dates, and,
if any Option Shares are purchased, at the Date of Delivery
(as described in Section 2(b) below), includes or will
include an untrue statement of a material fact or omits or
will omit to state any material fact necessary to make the
statements therein, in light of the circumstances under
which they were made, not misleading; except that this
representation and warranty does not apply to statements or
omissions made in reliance upon and in conformity with
information furnished in writing to the Company in
connection with the Registration Statement or the Prospectus
or any amendment thereof or supplement thereto by or on
behalf of the Underwriter expressly for use in the
Registration Statement or the Prospectus, or to statements
or omissions in that part of the Registration Statement
which constitutes the Statement of Eligibility under the
Trust Indenture Act (Form T-1) of the Trustee.
(iii) Incorporated Documents. The Prospectus as delivered
from time to time shall incorporate by reference the most
recent Annual Report of the Company on Form 10-K filed with
the Commission and each Quarterly Report of the Company on
Form 10-Q filed with the Commission and each Current Report
of the Company on Form 8-K filed (not fur-nished) with the
Commission and such other reports as specifically
incorporated by refer-ence in the Prospectus (the
"Incorporated Documents"). The Incorporated Documents filed
on or before the date hereof are referred to herein as the
"SEC Reports." The Incorporated Documents at the time they
were or hereafter are filed with the Commission, or if
amended, as so amended, complied and will comply in all
material respects with the requirements of the Exchange Act
and the rules and regulations of the Commission thereunder
(the "Exchange Act Regulations").
(iv) Independent Accountants. Ernst & Young LLP, who
reported on the annual consolidated financial statements of
the Company that are incorporated by reference in the
Registration Statement and the Prospectus, is an independent
registered public accounting firm as required by the
Securities Act and the Securities Act Regulations.
(v) Financial Statements. The financial statements
of the Company, together with the related schedules and notes,
included in the SEC Reports and incorporated by reference
into the Prospectus, present fairly the financial position
of the Company and its consolidated subsidiaries at the
dates indicated and the statement of income, shareholders'
equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally
accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved (except as
indicated in the footnotes to such financial statements).
The supporting schedules included in the SEC Reports and
incorporated by reference into the Prospectus present fairly
in accordance with GAAP the information required to be
stated therein.
(vi) No Material Adverse Change in Business. Since
the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as
otherwise stated therein or contemplated thereby, (A) there
has been no material adverse change in the condition,
financial or otherwise, or the earnings, results of
operations or general affairs of the Company and its
subsidiaries taken as a whole, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"),
(B) there have been no transactions entered into by the
Company or any of its Subsidiaries (as defined below), other
than those in the ordinary course of business, which are
material with respect to the Company and its Subsidiaries
taken as a whole, and (C) there has been no dividend or
distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(vii) Good Standing of the Company. The Company is
a corporation duly incorporated and validly existing in good
standing under the laws of the State of Delaware and has
corporate power and authority to own its properties and
conduct its business as described in the SEC Reports and to
enter into and perform its obligations under, or as
contemplated by, this Agreement. The Company is duly
qualified as a foreign corporation to transact business and
is in good standing in each other jurisdiction in which such
qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(viii) Good Standing of Subsidiaries. Each of American,
American Beacon Advisors, Inc., AMR Eagle Holding
Corporation, American Eagle Airlines, Inc. and Executive
Airlines, Inc. (each a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly
existing as a corporation, partnership or limited liability
company, as the case may be, in good standing under the laws
of the jurisdiction of its incorporation or organization, as
the case may be, has the power and authority to own, lease
and operate its properties and to conduct its business as
described in the SEC Reports and is duly qualified as a
foreign corporation, partnership or limited liability
company, as the case may be, to transact business and is in
good standing in each jurisdiction in which such
qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect;
except as otherwise disclosed in the SEC Reports, all of the
issued and outstanding equity interests of each such
Subsidiary have been duly authorized and validly issued, are
fully paid and non-assessable and are owned by the Company,
directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance,
claim or equity (except for the security interest in all of
the common stock of American granted by the Company pursuant
to the Pledge Agreement dated as of December 17, 2004 from
the Company to Citicorp USA, Inc., as collateral agent (the
"Pledge Agreement")); none of the outstanding equity
interests of any Subsidiary was issued in violation of the
preemptive or similar rights of any securityholder of such
Subsidiary. American and AMR Eagle Holding Corporation are
the only "significant subsidiaries" of the Company (as such
term is defined in Rule 1-02 of Regulation S-X).
(ix) Capitalization. The authorized, issued and outstanding
shares of capital stock of the Company are as set forth in
the SEC Reports (except for subsequent issuances, if any,
pursuant to this Agreement or pursuant to reservations,
agreements, convertible securities, options or employee
benefit plans referred to in the SEC Reports and/or referred
to in clauses (B), (C), (D) or (E) of Section 3(i) hereof).
The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are
fully paid and non-assessable; none of the outstanding
shares of capital stock of the Company was issued in
violation of any preemptive or other similar rights of any
securityholder of the Company. Other than as referred to in
this subparagraph (ix) or as disclosed in the SEC Reports,
no options, warrants or other rights to purchase, agreements
or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of
capital stock of or ownership interests in the Company are
outstanding.
(x) Authorization of this Agreement. This Agreement has
been duly authorized, executed and delivered by the Company.
(xi) Authorization and Description of Common Stock.
The Common Stock conforms in all material respects to the
description thereof contained in the Prospectus, and such
description will conform in all material respects to the
rights set forth in the instruments defining the same. The
Shares have been duly authorized and, when issued as
contemplated by this Agreement, will be validly issued and
will be fully paid and non-assessable; no holder of the
Shares will be subject to personal liability by reason of
being such a holder; and such issuance of the Shares is not
subject to the preemptive or other similar rights of any
securityholder of the Company.
(xii) Absence of Defaults and Conflicts. Neither the
Company nor any of its Subsidiaries is in violation of its
charter or by-laws or other constituting or organizational
document or in default in the performance or observance of
any obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or
instrument to which the Company or any of its Subsidiaries
is a party or by which the Company or any of its
Subsidiaries may be bound, or to which any of the property
or assets of the Company or any of its Subsidiaries is
subject (collectively, "Agreements and Instruments") except
for such defaults that would not reasonably be expected to
result in a Material Adverse Effect; and the execution and
delivery by the Company of this Agreement, the consummation
by the Company of the transactions contemplated by this
Agreement, and the compliance by the Company with its
obligations hereunder and the terms hereof and thereof do
not and will not, whether with or without the giving of
notice or passage of time or both, conflict with or
constitute a breach of, or default or a Repayment Event (as
defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its Subsidiaries
pursuant to, the Agreements and Instruments (except for such
conflicts, breaches, defaults or Repayment Events or liens,
charges or encumbrances that, singly or in the aggregate,
would not reasonably be expected to result in a Material
Adverse Effect), or result in a violation of the provisions
of the Certificate of Incorporation or By-Laws, as amended,
or other constituting or organizational document of the
Company or any of its Subsidiaries, or any applicable law,
statute, rule, regulation, judgment, order, write or decree
of any government, governmental instrumentality or court,
domestic or foreign, having jurisdiction over the Company or
any of its Subsidiaries or any of their respective assets,
properties or operations, except, in each case, for such
conflicts, breaches, violations or defaults, that, singly or
in the aggregate, would not reasonably be expected to result
in a Material Adverse Effect. As used herein, a "Repayment
Event" means any event or condition which gives the holder
of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment prior to the
stated maturity or date of mandatory redemption or repayment
thereof of all or a portion of such indebtedness by the
Company or any of its Subsidiaries.
(xiii) Absence of Labor Dispute. Other than as described
in the SEC Reports, no labor dispute with the employees of
the Company or any of its Subsidiaries exists or, to the
knowledge of the Company, is imminent which the Company
expects to have a Material Adverse Effect.
(xiv) Absence of Further Requirements. No consent,
approval, authorization, order or license of, or filing with
or notice to, any government, governmental instrumentality,
regulatory body or authority or court, domestic or foreign,
is required for the valid authorization, execution, delivery
and performance by the Company of this Agreement, for the
valid authorization, issuance, sale and delivery of the
Shares, or for the performance by the Company of its
obligations hereunder, except such as have been already
obtained and or as may be required under the Securities Act
or the Securities Act Regulations or state securities laws
in connection with the Registration Statement and the
listing of the Shares on the New York Stock Exchange.
(xv) Investment Company Act. Neither the Company nor
any of its Subsidiaries is, nor upon the issuance and sale of
the Shares as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus
Supplement will be, an "investment company" or an entity
"controlled" by an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended.
(xvi) Environmental Laws. There has been no storage,
disposal, generation, manufacture, refinement,
transportation, handling or treatment of toxic wastes,
medical wastes, hazardous wastes or hazardous substances by
the Company or any of its Subsidiaries (or, to the knowledge
of the Company, any of their predecessors in interest) at,
upon or from any of the property now or previously owned or
leased by the Company or its Subsidiaries in violation of,
and neither the Company nor any of its Subsidiaries has any
liability under, any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would
require remedial action under any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit
applicable to the Company or any of its Subsidiaries, except
for any violation or remedial action which would not have,
or could not be reasonably likely to have, singularly or in
the aggregate with all such violations and remedial actions,
a Material Adverse Effect; there has been no material spill,
discharge, leak, emission, injection, escape, dumping or
release of any kind onto such property or into the
environment surrounding such property of any toxic wastes,
medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its
Subsidiaries or with respect to which the Company or any of
its Subsidiaries have knowledge, except for any such spill,
discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably
likely to have, singularly or in the aggregate with all such
spills, discharges, leaks, emissions, injections, escapes,
dumpings and releases, a Material Adverse Effect. The terms
"hazardous wastes," "toxic wastes," "hazardous substances"
and "medical wastes" shall have the meanings specified in
any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
In the ordinary course of its business, the Company conducts
a periodic review of the effect of any and all applicable
foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("Environmental Laws") on the
business, operations and properties of the Company and its
Subsidiaries, in the course of which it identifies and
evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance
with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any
potential liabilities to third parties). On the basis of
such review, the Company has reasonably concluded that such
associated costs and liabilities have not had and would not,
singularly or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
(xvii) ERISA. Each of the Company and American is
in compliance in all material respects with all presently
applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations
and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with
respect to any "pension plan" (as defined in ERISA) for
which either the Company or American would have any
liability; neither the Company nor American has incurred and
does not expect to incur liability under (A) Title IV of
ERISA with respect to the termination of, or withdrawal
from, any "pension plan" or (B) Section 412 or 4971 of the
Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the
"Code"); and each "pension plan" for which either the
Company or American would have any liability that is
intended to be qualified under Section 401(a) of the Code is
so qualified in all material respects and nothing has
occurred, whether by action or by failure to act, which the
Company reasonably expects would cause the loss of such
qualification.
(xviii) Insurance. The Company and each of its
Subsidiaries carry, or are covered by, insurance in such
amounts and covering such risks as is adequate for the
conduct of their respective businesses and the value of
their respective properties.
(xix) Taxes. The Company and each of its Subsidiaries
has filed all federal, state and local income and franchise
tax returns required to be filed through the date hereof,
except for such exceptions as would not individually or
collectively have a Material Adverse Effect, and has paid
all taxes due thereon, except such as are being contested in
good faith by appropriate proceedings, and no tax deficiency
has been determined adversely to the Company or any of its
Subsidiaries which has had, nor does the Company have any
knowledge of any tax deficiency which, if determined
adversely to the Company or any of its Subsidiaries, might
have, a Material Adverse Effect.
(xx) Internal Controls. The Company (A) makes and keeps
accurate books and records that, in reasonable detail,
accurately and fairly reflect the transactions and
disposition of the assets of the Company, and (B) maintain
internal accounting controls which provide reasonable
assurance that (i) transactions are executed in accordance
with management's authorization, (ii) transactions are
recorded as necessary to permit preparation of its financial
statements in conformity with generally accepted accounting
principles and to maintain accountability for its assets,
(iii) access to its assets is permitted only in accordance
with management's authorization and (iv) the recorded
accountability for its assets is compared with existing
assets at reasonable intervals. The Company maintains a
system of internal control over financial reporting (as such
term is defined in Rule 13a-15(f) of the Exchange Act) that
has been designed by the Company's principal executive
officer and principal financial officer, or under their
supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of
financial statements for external purposes in accordance
with generally accepted accounting principles. The Company
is not aware of any material weaknesses in its internal
control over financial reporting which are reasonably likely
to adversely affect the Company's ability to record,
process, summarize and report financial information. Since
the date of the latest audited financial statements included
in the Prospectus, there has been no change in the Company's
internal control over financial reporting that has
materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial
reporting.
(xxi) Disclosure Controls and Procedures. The Company
maintains disclosure controls and procedures (as such term
is defined in Rule 13a-15(e) of the Exchange Act) that have
been designed to ensure that material information relating
to the Company, including its consolidated subsidiaries, is
made known to the Company's principal executive officer and
principal financial officer by others within those entities;
and such disclosure controls and procedures are effective.
(xxii) No Unlawful Payments. The Company has implemented
compliance programs for purposes of (i) informing the
appropriate officers and employees of the Company and its
Subsidiaries of (A) the Company's policies against (1) the
use of corporate funds for unlawful contributions, gifts,
entertainment or other unlawful expenses relating to
political activity, (2) direct or indirect unlawful payments
to any foreign or domestic government official or employee
from corporate funds, (3) violations of the Foreign Corrupt
Practices Act of 1977, as amended and (4) making any bribes,
rebates, payoffs, influence payments kickbacks or other
unlawful payments and (ii) requiring such officers and
employees to report to the Company any knowledge they may
have of violations of the Company's policies referred to
above and no such reports have been made.
(xxiii) No Brokerage Commission; Finder's Fee. To the
best of the Company's knowledge after due inquiry, there are
no contracts, agreements or understandings between the
Company or any Subsidiary and any person that would give
rise to a valid claim against the Company or the Underwriter
for a brokerage commission, finder's fee or other like
payment in connection with this offering.
(xxiv) Dividend Payments. Except as provided in the
Pledge Agreement, neither American is nor AMR Eagle Holding
Corporation is currently prohibited, directly or indirectly,
under any agreement or other instrument to which it is a
party or is subject, from paying any dividends to the
Company, from making any other distribution on its
respective capital stock or from repaying to the Company any
loans or advances to it from the Company, except as would
not have a Material Adverse Effect.
(xxv) Reporting Company. The Company is subject to the
reporting requirements of Section 13 or Section 15(d) of the
Exchange Act.
(xxvi) Air Carrier Certification. American, a wholly
owned subsidiary of the Company, (i) is an "air carrier"
within the meaning of 49 U.S.C. Section 40102(a), (ii) holds
an air carrier operating certificate issued by the Secretary
of Transportation pursuant to Chapter 447 of Title 49 of the
Unites States Code for aircraft capable of carrying 10 or
more individuals or 6,000 pounds or more of cargo, and (iii)
is a "citizen of the United States" as defined in 49 U.S.C.
40102.
(xxvii) Possession of Licenses and Permits. The
Company and its Subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively,
"Licenses") issued by the appropriate federal, state, local
or foreign regulatory agencies or bodies and third parties,
governmental or otherwise, necessary to conduct the business
now operated by them as described in the SEC Reports, except
for such failures to possess Licenses as would not
individually or collectively have a Material Adverse Effect;
the Company and its Subsidiaries are in compliance with the
terms and conditions of all such Licenses, except where the
failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Licenses are
valid and in full force and effect, except when the
invalidity of such Licenses or the failure of such Licenses
to be in full force and effect would not have a Material
Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating
to the revocation or modification of any such Licenses
which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(b) Officer's Certificates. Any certificate signed by any
officer of the Company delivered to the Underwriter or to
counsel for the Underwriter shall be deemed a representation
and warranty by the Company to the Underwriter as to the
matters covered thereby as of the date or dates indicated in
such certificate.
SECTION 2. Sale and Delivery to Underwriter; Closing.
(a) Sale of Firm Shares. On the basis of the
representations, warranties and agreements herein contained
and subject to the terms and conditions herein set forth,
the Company agrees to sell to the Underwriter, and the
Underwriter agrees to purchase 13,000,000 Firm Shares from
the Company at the price per share of $17.16.
(b) Option Shares. In addition, on the basis of the
representations, warranties and agreements herein contained
and subject to the terms and conditions herein set forth,
the Company hereby grants a one-time option to the
Underwriter to purchase up to an additional 1,950,000 Option
Shares at the price per Share set forth in the paragraph
above. The option hereby granted will expire 30 days after
the date hereof and may be exercised solely for the purpose
of covering over-allotments which may be made in connection
with the offering and distribution of the Firm Shares as may
be modified by subsequent purchases and sales by the
Underwriter upon written, including by email, notice by the
Underwriter to the Company setting forth the number of
Option Shares as to which the Underwriter is then exercising
the option and the time and date of payment and delivery for
such Option Shares. Such time and date of delivery (the
"Date of Delivery") shall be determined by the Underwriter,
but shall not be later than seven full business days after
the exercise of said option, nor in any event prior to the
Closing Time, as hereinafter defined, unless otherwise
agreed upon by the Underwriter and the Company. If the
option is exercised as to all or any portion of the Option
Shares, the Underwriter will purchase the entire aggregate
principal amount of Option Shares then being purchased.
(c) Payment of Purchase Price. Payment of the purchase
price for and delivery of the Firm Shares shall be made at
the offices of Debevoise & Xxxxxxxx LLP, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, or at such other place as shall be
agreed upon by the Underwriter and the Company, at 10:00
A.M. (New York time) on the third business day after the
date hereof, or at such other time not later than ten
business days after such date as shall be agreed upon by the
Underwriter and the Company (such time and date of payment
and delivery being herein called the "Closing Time").
In addition, in the event that the Underwriter has exercised
its option to purchase all or any of the Option Shares,
payment of the purchase price for and delivery of such
Option Shares shall be made at the above-mentioned offices,
or at such other place as shall be agreed upon by the
Underwriter and the Company, on the Date of Delivery as
specified in the written, including by email, notice from
the Underwriter to the Company.
Payment shall be made to the Company by wire or interbank
transfer of immediately available funds to a bank account
designated by the Company, against delivery to the
Underwriter of the Shares to be purchased by the
Underwriter.
(d) Denominations; Delivery of Shares. The Shares to be
purchased by the Underwriter hereunder, in such authorized
denominations and registered in such names as the
Underwriter may request in writing upon at least at least
one full business day prior to the Closing Time or the Date
of Delivery, as the case may be, shall be delivered by or on
behalf of the Company by book entry transfer through the
facilities of The Depository Trust Company to the
Underwriter, for the account of the Underwriter, against
payment by or on behalf of the Underwriter of the purchase
price therefore by wire or interbank transfer of immediately
available funds to a bank account designated by the Company.
SECTION 3. Covenants of the Company. The Company
covenants with the Underwriter as follows:
(a) Immediately following the execution of this Agreement,
the Company will prepare a Prospectus Supplement with
respect to the Shares that complies with the Securities Act
and the Securities Act Regulations and which sets forth the
name of the Underwriter and the number of Shares that the
Underwriter has agreed to purchase, the price at which the
Shares are to be purchased by the Underwriter from the
Company, any initial public offering price, any selling
concession and re-allowance, and such other information as
the Underwriter and the Company deem appropriate in
connection with the offering of the Shares. The Company
will promptly transmit copies of the Prospectus Supplement
and the Prospectus to the Commission for filing pursuant to
Rule 424 under the Securities Act and will furnish to the
Underwriter as many copies of the Prospectus Supplement and
the Prospectus as the Underwriter shall reasona-xxx request.
(b) During the period when a prospectus relating to the
Shares is required to be delivered under the Securities
Act, the Company will promptly advise the Underwriter of (i)
the effectiveness of any amendment to the Registration
Statement, (ii) the transmittal to the Commission for
filing of any supplement to the Prospectus or any document
that would as a result thereof be incorporated by reference
in the Prospectus, (iii) any request by the Commission for
any amendment of the Registration Statement or any amendment
or supplement to the Prospectus or for any additional
information relating thereto or to any document incorporated
by reference therein, (iv) the issuance by the Commission
of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of
any proceeding for that purpose, and (v) the receipt by the
Company of any notification with respect to the suspension
of the qualification of the Shares for sale in any
jurisdiction or the institution or threatening of any pro-
ceeding for such purpose. The Company will use its best
efforts to prevent the issuance of any such stop order or
suspension and, if issued, to obtain as soon as possible the
withdrawal thereof.
(c) If, at any time when a prospectus relating to the
Shares is required to be delivered under the Securities Act,
any event occurs as a result of which the Prospectus as then
amended or supplemented would include any untrue statement
of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or
if it shall be necessary to amend or supplement the
Prospectus to comply with the Securities Act or the
Securities Act Regulations, the Company promptly will
prepare and file with the Commission, subject to paragraph
(d) of this Section 3, an amendment or supplement which
will correct such statement or omission or an amendment or
supplement which will effect such compliance. Neither the
Underwriter's consent to, nor the Underwriter's delivery of,
any such amendment or supplement shall constitute a waiver
of any of the conditions set forth in Section 5.
(d) At any time when a prospectus relating to the Shares
is required to be delivered under the Securities Act or the
Securities Act Regulations, the Company will give the Under-
writer notice of its intention to file any amendment to the
Registration Statement or any amendment or supplement to
the Prospectus, whether pursuant to the Exchange Act, the
Securities Act or otherwise, will furnish the Underwriter
with copies of any such amendment or supplement or other
documents proposed to be filed within a reasonable time in
advance of filing, and will not file any such amendment or
supplement or other documents in a form to which the
Underwriter shall reasonably object.
(e) The Company has furnished or will, if requested,
furnish to the Underwriter and its counsel, without charge,
conformed copies of the Registration Statement as originally
filed and of all amendments thereto, whether filed before or
after such Registration Statement originally became
effective (including exhibits thereto and the documents
incorporated therein by reference) and, so long as delivery
of a prospectus by an underwriter or dealer may be required
by the Securities Act, as many copies of any preliminary
prospectus, the Prospectus and any amendments thereof and
supplements thereto as the Underwriter may reasonably
request.
(f) The Company shall use its reasonable efforts, in
cooperation with the Underwriter, to qualify the Shares for
offering and sale under the applicable securities laws of
such states in the United States as the Underwriter may
reasonably designate and will maintain such qualification in
effect as long as required in connection with the
distribution of the Shares; provided, however, that the
Company shall not be obligated to file any general consent
to service of process or to qualify as a foreign corporation
or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it
is not otherwise so subject.
(g) The Company will use the net proceeds received by it
from the sale of the Shares in the manner to be indicated in
the Prospectus Supplement under "Use of Proceeds."
(h) The Company will use its reasonable efforts to cause
the Shares to be listed on the New York Stock Exchange or
listed on a "national securities exchange" registered under
Section 6 of the Exchange Act.
(i) During a period of thirty (30) days from the date of
the Prospectus Supplement, the Company will not, without the
prior written consent of the Underwriter (i) offer, pledge,
announce the intention to sell, sell, contract to sell,
sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant for
the sale of, lend or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or
securities converti-ble into or exchangeable or exercisable
for or repayable with Common Stock, or file any regis-
tration statement under the Securities Act with respect to
any of the foregoing (other than a shelf registration
statement under Rule 415) or (ii) enter into any swap or
other agreement or any transaction that transfers in whole
or in part, directly or indirectly, any of the economic
conse-quence of ownership of the Common Stock, or any
securities convertible into or exchangeable or exercisable
for or repayable with Common Stock, whether any such swap or
transaction de-scribed in clause (i) or (ii) above is to be
settled by delivery of Common Stock or such other se-
curities, in cash or otherwise. The foregoing sentence
shall not apply to (A) the Shares to be sold hereunder, (B)
the Common Stock to be delivered upon conversion of the
Company's 4.25% Senior Convertible Notes due 2023 or the
Company's 4.50% Senior Convertible Notes due 2024, (C) the
resale registration statement filed by the Company and
American pursuant to the registration rights agreement
relating to resales of the Company's 4.25% Senior
Convertible Notes due 2023, (D) Common Stock (or options to
purchase Common Stock) to be issued pursuant to the
Corporation's 1988 Long Term Incentive Plan, as amended, the
1998 Long Term Incentive Plan, as amended, the 1994
Directors Stock Incentive Plan, as amended, the 1997 Pilot
Stock Option Plan, the 2003 Employee Stock Incentive Plan or
other employee compensation benefit plans or pursuant to
currently outstanding options, warrants or rights existing
on the date hereof and referred to in the Prospectus
Supplement, and (E) up to 100,000 shares of the Common Stock
to be issued to vendors, lessors, lenders and suppliers
pursuant to concessionary agree-ments reached with them in
the Spring of 2003.
(j) The Company shall cooperate with the Underwriter and
use its reasonable efforts to permit the Shares to be
eligible for clearance and settlement through the facilities
of The Depository Trust Company ("DTC").
(k) The Company, during the period when a Prospectus
relating to the Shares is required to be delivered, will
file all documents required to be filed with the Commission
pursuant to the Exchange Act within the time periods
required by the Exchange Act and the Exchange Act
Regulations.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company shall pay all expenses incident
to the performance of its obligations under this Agreement,
including (i) the preparation, printing, filing and
distribution of any preliminary prospectus supplements, the
Prospectus (including financial statements and any schedules
or exhibits and any Incorporated Document), the Registration
Statement and any amendments thereof or supplements thereto,
(ii) the preparation, printing and delivery to the
Underwriter of this Agreement, the Shares, and such other
documents as may be required in connection with the offer,
purchase, sale, issuance or delivery of the Shares, (iii)
the preparation, issuance and delivery of the certificates
for the Shares to the Underwriter, including any transfer
taxes, any stamp or other duties payable upon the sale,
issuance and delivery of the Shares to the Underwriter and
any charges of DTC in connection therewith, (iv) the fees
and disbursements of the Company's counsel, accountants and
other advisors, (v) the qualification of the Shares under
securities laws in accordance with the provisions of Section
3(f) hereof, including filing fees and the reasonable fees
and disbursements of a single counsel for the Underwriter in
connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) any
fees of the NASD in connection with the Shares, and (vii)
the fees and expenses of any transfer agent or registrar for
the Common Stock. It is understood, however, that except as
provided in this Section and Section 7 hereof, the
Underwriter will pay all of its own costs and expenses,
including the fees of its counsel, transfer taxes on resale
of any of the securities by it, and any promotional expenses
connected with any offers it may make.
(b) Termination of Agreement. If this Agreement is
terminated by the Underwriter in accordance with the
provisions of Section 5 or Section 9(a)(i) hereof, the
Company shall reimburse the Underwriter for all of its out-
of-pocket expenses, including the reasonable fees and
disbursements of a single counsel for the Underwriter
incurred by it in connection with the offering contemplated
by this Agreement.
SECTION 5. Conditions of the Underwriter's Obligations.
The obligations of the Underwriter hereunder are subject to
the accuracy of the representations and warranties of the
Company contained in Section 1 hereof or in certificates of
any officer of the Company delivered pursuant to the
provisions hereof, to the performance by the Company of its
covenants and other obligations hereunder, and to the
following further conditions:
(a) Opinions of Counsel for the Company. At the Closing
Time, the Underwriter shall have received the opinion of
Xxxx X. Xxxxxxx, Senior Vice President and General Counsel
of the Company, and the opinion of Debevoise & Xxxxxxxx LLP,
counsel for the Company, each in form and substance
reasonably satisfactory to counsel for the Underwriter and
dated as of the Closing Time, to the effect set forth in
Exhibits A and B hereto, respectively. Such counsel may
also state that, insofar as such opinion involves factual
matters, they have relied, to the extent they deem proper,
upon certificates of the officers of the Company and
certificates of public officials.
(b) Opinion of Counsel for the Underwriter. At the Closing
Time, the Underwriter shall have received the opinion, dated
as of the Closing Time, of Shearman & Sterling LLP, counsel
for the Underwriter, in form and substance reasonably
satisfactory to the Underwriter. In giving such opinion
such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New
York, the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions
of counsel satisfactory to the Underwriter. Such counsel
may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company and
certificates of public officials.
(c) Officers' Certificate. At the Closing Time, there shall
not have been, since the date hereof or since the respective
dates as of which information is given in the Prospectus
Supplement (exclusive of any amendments or supplements
thereto after the date the Prospectus Supplement is first
delivered to the Underwriter), any material adverse change
in the condition, financial or otherwise, or in the results
of operations or business affairs of the Company and its
Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the
Underwriter shall have received a certificate of the
President or a Senior Vice President of the Company and the
Chief Financial Officer or Chief Accounting Officer of the
Company, dated as of the Closing Time, to the effect that
(i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are
true and correct with the same force and effect as though
expressly made at and as of the Closing Time, and (iii) the
Company has complied with all of the agreements entered into
in connection with the transaction contemplated herein and
satisfied all conditions on their part to be performed or
satisfied at or prior to the Closing Time.
(d) Accountant's Comfort Letter. At or prior to the Closing
Time, the Underwriter shall have received from Ernst & Young
LLP a letter dated such date, in the form and substance
reasonably satisfactory to the Underwriter, containing
statements and information of the type ordinarily included
in accountants' comfort letters to underwriters with respect
to the financial statements and certain financial
information contained, or incorporated by reference, in the
Prospectus.
(e) No Stop Order. At the Closing Time, no stop order
suspending the effectiveness of the Registration Statement
shall have been issued under the Securities Act and no
proceedings therefor shall have been instituted or
threatened by the Commission.
(f) Conditions to Purchase of Option Shares. In the event
that the Underwriter exercises its option provided in
Section 2(b) hereof to purchase all or any portion of the
Option Shares, the obligation of the Underwriter to purchase
such Option Shares is subject to the accuracy as of each
Date of Delivery of the representations and warranties of
the Company contained in Section 1 or in certificates of any
officer of the Company delivered pursuant to the provisions
hereof, to the performance by the Company of its covenants
and other obligations hereunder, and at the Date of
Delivery, the Underwriter shall have received:
(i) Officers' Certificate. A certificate, dated the
Date of Delivery, of the President or Senior Vice President
of the Company and the Chief Financial Officer or Chief
Accounting Officer of the Company confirming that the
certificate delivered at the Closing Time pursuant to
Section 5(c) hereof remains true and correct as of the Date
of Delivery.
(ii) Opinions of Counsel for the Company. The opinion
of Xxxx X. Xxxxxxx, Senior Vice President and General Counsel
of the Company, and the opinion of Debevoise & Xxxxxxxx LLP,
counsel for the Company, each in form and substance
reasonably satisfactory to the Underwriter, each dated the
Date of Delivery, relating to the Option Shares to be
purchased on the Date of Delivery and otherwise to the same
effect as the respective opinions required by Section 5(a)
hereof.
(iii) Opinion of Counsel for the Underwriter. The
opinion of Shearman & Sterling LLP, counsel for the Underwriter,
dated the Date of Delivery, relating to the Option Shares to
be purchased on the Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(b) hereof.
(iv) Bring-down Comfort Letter. A letter from Ernst &
Young LLP, in form and substance satisfactory to the
Underwriter and dated the Date of Delivery, substantially in
the same form and substance as the letter furnished to the
Underwriter pursuant to Section 5(d) hereof, except that the
"specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than three business days
prior to the Date of Delivery.
(g) Additional Documents. At the Closing Time and at the
Date of Delivery, counsel for the Underwriter shall have
been furnished with such documents, certificates and
opinions as they may reasonably request for the purpose of
enabling them to pass upon the issuance and sale of the
Shares as herein contemplated, or in order to evidence the
accuracy and completeness of any of the representations or
warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company
in connection with the issuance and sale of the Shares as
herein contemplated shall be reasonably satisfactory to the
Underwriter and counsel for the Underwriter.
(h) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement (or, in the case of
any condition to the purchase of Option Shares, on a Date of
Delivery which is after the Closing Time, the obligation of
the Underwriter to purchase the relevant Option Shares on
such Date of Delivery) may be terminated by the Underwriter
by notice to the Company at any time at or prior to the
Closing Time or such Date of Delivery, as the case may be,
and such termination shall be without liability of any party
to any other party except as provided in Section 4 and
except that Sections 1, 7 and 8 shall survive any such
termination and remain in full force and effect.
SECTION 6. Acknowledgements.
The Underwriter, on behalf of itself and each of its
affiliates that participates in the initial distribution of
the Shares, acknowledges that (i) the Company has not
authorized or taken, and will not take, any action that
would permit a public offering of the Shares or the public
distribution of the Prospectus or any other offering or
publicity material relating to the Shares in any jurisdic-
tion outside the United States; (ii) no prospectus will be
published in relation to any Shares in any Member State of
the European Economic Area that has implemented the
Prospectus Direc-tive (each, a "Relevant Member State"); and
(iii) no prospectus in relation to any Shares will be
approved by a competent authority in any Relevant Member
State. For the purposes of the pre-ceding sentence, the
expression "Prospectus Directive" means Directive 2003/71/EC
and includes any relevant implementing measure in each
Relevant Member State.
SECTION 7. Indemnification and Contribution. (a) The
Company agrees to indemnify and hold harmless the
Underwriter, each of its directors, and each person who
controls the Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the
Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them
may become subject under the Securities Act, the Exchange
Act, or other Federal or state statutory law or regulation,
at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) (1)
arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement as originally filed or in any
amendment thereof, or arise out of or are based upon the
omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the
statements therein not misleading, or (2) arise out of or
based upon any untrue statement or alleged untrue statement
of a material fact contained in any preliminary prospectus
relating to the Shares or in the Prospectus or in any
amendment thereof or supplement thereto, or arise out of or
are based upon the omission or alleged omission therefrom of
a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading, and, in each case, agrees to reimburse
each such indemnified party for any legal or other expenses
reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or
action; provided, however, that (i) the Company shall not be
liable in any such case to the extent that any such loss,
claim, damage, or liability arises out of or is based upon
any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon,
and in conformity with, written information relating to the
Underwriter furnished to the Company by or on behalf of the
Underwriter specifically for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or
any amendment or supplement thereto) or made in the part of
the Registration Statement constituting the Statement of
Eligibility under the Trust Indenture Act of the Trustee on
Form T-1, (ii) the foregoing indemnity agreement, with
respect to any preliminary prospectus, shall not inure to
the benefit of the Underwriter (or any person controlling
the Underwriter) as to whom it shall be established did not
send or deliver to the person asserting any such loss,
claim, damage or liability and who purchased Shares which
are the subject thereof a copy of the Prospectus as amended
or supplemented (exclusive of material incorporated by
reference) at or prior to the written confirmation of the
sale of such Shares in any case where such delivery is
required by the Securities Act, and the untrue statement or
omission of a material fact contained in any such
preliminary prospectus was corrected in the Prospectus as
amended or supplemented and the Company had previously
furnished copies thereof to the Underwriter, and (iii) the
Company shall not be liable for any loss, liability or
expense of any settlement or compromise of or consent to
entry of judgment with respect to, any pending or threatened
litigation or any pending or threatened governmental agency
investigation or proceeding if such settlement or compromise
of or consent to entry of judgment with respect thereto is
effected without the prior written consent of the Company,
except to the extent that such consent is not required
pursuant to Section 7(d) hereof. This indemnity agreement
will be in addition to any liability that the Company may
otherwise have.
(b) The Underwriter agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who
signed the Registration Statement, and each person who con-
trols the Company, within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act,
against any and all losses, claims, damages, liabilities and
expenses described in the indemnity contained in Section
7(a), but only with respect to untrue statements or alleged
untrue statements or omissions or alleged omissions made in
the Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information
relating to the Underwriter furnished to the Company by or
on behalf of the Underwriter specifically for use in the
Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto). This
indemnity agreement will be in addition to any liability
that the Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under
this Section 7 of notice of the commencement of any action,
such indemnified party will, if a claim in respect thereof
is to be made against the indemnifying party under this
Section 7, notify the indemnifying party or parties in
writing of the commencement thereof; but the omission so to
notify the indemnifying party or parties will not relieve it
from any liability which it may have to any indemnified
party otherwise than under this Section 7. In case any such
action is brought against any indemnified party and it
notifies the indemnifying party or parties of the
commencement thereof, the indemnifying party or parties will
be entitled to participate therein, and to the extent that
it may elect, by written notice delivered to such
indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense
thereof, with counsel satisfactory to such indemnified
party; provided, however, that if, in the reasonable
judgment of such indemnified party, a conflict of interest
exists where it is advisable for such indemnified party to
be represented by separate counsel, the indemnified party
shall have the right to employ separate counsel in any such
action, in which event the fees and expenses of such
separate counsel shall be borne by the indemnifying party or
parties. Upon receipt of notice from the indemnifying party
or parties to such indemnified party of the election so to
assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party or
parties will not be liable to such indemnified party under
this Section 7 for any legal or other expenses subsequently
incurred by such indemnified party in connection with the
defense thereof unless (i) the indemnified party shall have
employed separate counsel in accordance with the proviso to
the next preceding sentence (it being understood, however,
that the indemnifying party or parties shall not be liable
for the expenses of more than one such separate counsel
representing the indemnified parties under subparagraph (a)
of this Section 7 who are parties to such action), (ii) the
indemnifying party or parties shall not have employed
counsel satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice
of commencement of the action or (iii) the indemnifying
party or parties have authorized the employment of counsel
for the indemnified party at the expense of the indemnifying
party or parties; and except that, if clause (i) or (iii) is
applicable, such liability shall be only in respect of the
counsel referred to in such clause (i) or (iii). It is
understood that all such fees and expenses of counsel for
the indemnified party for which the indemnifying party is
liable shall be reimbursed as they are incurred. No
indemnifying party shall, without the prior written consent
of the indemnified party (which consent shall not be
unreasonably withheld), effect any settlement or compromise
of, or consent to entry of judgment with respect to, any
pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and
indemnity could have been sought hereunder by such
indemnified party, unless such settlement or compromise of,
or consent to entry of judgment with respect to, includes an
unconditional release of such indemnified party from all
liability on claims that are the subject matter of such
proceeding and does not include a statement as to or an
admission of fault, culpability or failure to act by or on
behalf of any indemnified party.
(d) If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel payable pursuant to
this Section 7, such indemnifying party agrees that it shall
be liable for any settlement, compromise or consent to entry
of judgment of the nature contemplated by clause (iii) of
the proviso in Section 7(a) effected without its written
consent if (i) such settlement, compromise or consent to
entry of judgment is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid notice
of request, (ii) such indemnifying party shall have received
notice of the terms of such settlement, compromise or
consent to entry of judgment at least 30 days prior to such
settlement being entered into, and (iii) such indemnifying
party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such
settlement, compromise or consent to entry of judgment.
(e) If the indemnification provided for in paragraph (a)
or (b) of this Section 7 is for any reason unavailable to or
insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party
shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such
indemnified party, (i) in such proportion as is appropriate
to reflect the relative benefits received by the Company on
the one hand and the Underwriter on the other hand from the
offering of the Shares pursuant to this Agreement or (ii) if
the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company on the
one hand and of the Underwriter on the other hand in
connection with the statements or omissions which resulted
in such losses, liabilities, claims, damages or expenses, as
well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand
and the Underwriter on the other hand in connection with the
offering of the Shares pursuant to this Agreement shall be
deemed to be in the same proportion as the total proceeds
from the offering of the Shares pursuant to this Agreement
(net of compensation paid to the Underwriter but before
deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the
Underwriter, in each case as set forth on the cover of the
Prospectus, bears to the aggregate initial public offering
price of the Shares as set forth on such cover. The
relative fault of the Company on the one hand and the
Underwriter on the other hand shall be determined by
reference to, among other things, whether any such untrue or
alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriter
and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriter
agree that it would not be just and equitable if
contribution pursuant to this Section were determined by pro
rata allocation or by any other method of allocation which
does not take account of the equitable considerations
referred to above in this Section. The aggregate amount of
losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this
Section shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any such
action or claim. Notwithstanding the provisions of this
Section, the Underwriter shall not be required to contribute
any amount in excess of the amount by which the total price
at which the Shares underwritten by it and distributed to
the public were offered to the public exceeds the amount of
any damages which the Underwriter has otherwise been
required to pay by reason of any such untrue or alleged
untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section,
each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act shall have the same rights to contribution
as the Underwriter, and each director of the Company, each
officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act shall have the same rights to
contribution as the Company.
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and
agreements contained in this Agreement or in certificates of
officers of the Company submitted pursuant hereto shall
remain operative and in full force and effect, regardless of
any investigation made by or on behalf of the Underwriter or
any person who controls the Underwriter within the meaning
of Section 15 of the Securities Act or Section 20 of the
Exchange Act, or by or on behalf of the Company, and shall
survive delivery of the Shares to the Underwriter.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Underwriter may terminate
this Agreement, by notice to the Company, at any time at or
prior to the Closing Time (i) if there has been, since the
respective dates as of which information is given in the
Registration Statement and the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of
this Agreement), any material adverse change in the
condition, financial or otherwise, of the Company and its
subsidiaries considered as one enterprise or in the
earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business,
or (ii) if there has occurred any material adverse change in
the financial markets in the United States or in the
international financial markets, or any outbreak of
hostilities or escalation thereof or other calamity or
crisis, in each case the effect of which is such as to make
it, in the judgment of the Underwriter, impracticable or
inadvisable to market the Shares or to enforce contracts for
the sale of the Shares, or (iii) if trading in any
securities of the Company has been suspended by the
Commission or the New York Stock Exchange or if trading
generally on the New York Stock Exchange has been suspended
or materially limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or
by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental
authority, or (iv) if a banking moratorium has been declared
by either federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant
to this Section, such termination shall be without liability
of any party to any other party except as provided in
Section 4 hereof, and provided further that Sections 1, 7
and 8 shall survive such termination and remain in full
force and effect.
SECTION 10. Notices. All notices and other
communications hereunder shall be in writing and effective
only upon receipt. Notices to the Underwriter shall be
directed to them at: UBS Securities LLC, 000 Xxxx Xxxxxx,
Xxx Xxxx, XX 00000-0000, Attn: Syndicate Department; and
notices to the Company shall be directed to them at X.X.
Xxx 000000, Xxxxxx/Xxxx Xxxxx Xxxxxxx, Xxxxx 00000-0000,
facsimile no. (000) 000-0000, attention of the Treasurer.
SECTION 11. [RESERVED.]
SECTION 12. Parties. This Agreement shall inure to the
benefit of and be binding upon the Underwriter and the
Company and their respective successors. Nothing expressed
or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other
than the Underwriter and the Company and their respective
successors and the controlling persons referred to in
Section 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained.
This Agreement and all conditions and provisions hereof are
intended to be for the sole and exclusive benefit of the
Underwriter and the Company and their respective successors,
and said controlling persons and their heirs and legal
representatives, and for the benefit of no other person,
firm or corporation. No purchaser of Shares from the
Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 13. No Fiduciary Duty. The Company acknowledges
and agrees that the Underwriter is acting solely in the capacity
of an arm's length contractual counterparty to the Company
with respect to the offering of Shares contemplated hereby
(including in connection with determining the terms of such
offering) and not as a financial advisor or a fiduciary to,
or an agent of, the Company or any of its subsidiaries.
Additionally, the Underwriter is not advising the Company or
any of its subsidiaries as to any legal, tax, investment,
accounting or regulatory matters in any jurisdiction with
respect to the offering of the Shares or the process leading
thereto (irrespective of whether the Underwriter has advised
or is advising the Company on other matters). The
Underwriter advises that it and its affiliates are engaged
in a broad range of securities and financial services and
that its and its affiliates may enter into contractual
relationships with purchasers or potential purchasers of the
Company's securities and that some of these services or
relationships may involve interests that differ from those
of the Company and need not be disclosed to the Company,
unless otherwise required by law. The Company has consulted
with its own advisors concerning such matters and shall be
responsible for making its own independent investigation and
appraisal of the transactions contemplated hereby, and the
Underwriter shall have no responsibility or liability to the
Company or any of its subsidiaries with respect thereto.
Any review by the Underwriter of the Company, the
transactions contemplated hereby or other matters relating
to such transactions will be performed solely for the
benefit of the Underwriter and shall not be on behalf of the
Company. The Company waives, to the fullest extent
permitted by law, any claims it may have against the
Underwriter for breach of fiduciary duty or alleged breach
of fiduciary duty and agrees that the Underwriter shall have
no liability (whether direct or indirect) to the Company in
respect of such a fiduciary duty claim.
SECTION 14. Governing Law and Time. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK. EXCEPT AS OTHERWISE SET FORTH
HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section
headings herein and the Table of Contents are for
convenience only and shall not affect the construction
hereof.
SECTION 16. Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed
to be an original, but all such counterparts shall together
constitute one and the same Agreement.
If the foregoing is in accordance with your understanding
of our agreement, please sign and return to the Company a
counterpart hereof, whereupon this instrument, along with
all counterparts, will become a binding agreement between
the Underwriter and the Company in accordance with its
terms.
Very truly yours,
AMR CORPORATION
By: /s/ Xxxxx Xxxx
Senior Vice President -
Finance and Chief Financial Officer
CONFIRMED AND ACCEPTED, as of the date first above written:
UBS SECURITIES LLC
By: /s/ Xxxxxxx Xxxxx
Name: Xxxxxxx Xxxxx
Title: Managing Director
By: /s/ Xxxxx X. Xxx
Name: Xxxxx X. Xxx
Title: Managing Director
EXHIBIT A
FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY,
TO BE DELIVERED PURSUANT TO SECTION 5(a)
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Issuance and Sale of AMR Corporation Common Stock
Ladies and Gentlemen:
I am Senior Vice President and General Counsel of AMR
Corporation, a Delaware corporation (the "Company") and
have acted as such in connection with: (a) the issuance and
sale today by the Company of ________ shares (the "Shares"),
of the Company's common stock, par value $1.00 per share,
to you pursuant to the Underwriting Agreement, dated
__________, 2005 (the "Underwriting Agreement"), among the
Company and you; and (b) the preparation of (i) the
Underwriting Agreement and (ii) the final Prospectus
Supplement, dated __________, 2005 relating to the Shares
(the "Prospectus Supplement"). I am delivering this letter
to you pursuant to Section 5(a) of the Underwriting
Agreement. Capitalized terms used herein without definition
are used as defined in the Underwriting Agreement.
In so acting, I or attorneys under my supervision have
examined the Registration Statement, the Prospectus, the
Underwriting Agreement and the Shares, and have also
examined and relied upon the representations and warranties
as to factual matters contained therein or made pursuant
thereto and upon the originals, or copies certified or oth-
erwise identified to our satisfaction, of such records,
documents and other instruments as in our judgment are
necessary or appropriate to enable me to render the opinion
expressed below. In such examination, I or such attorneys
have assumed the genuineness of all signatures, the
authenticity of all documents submitted as originals, and
the conformity to authentic original documents of all
documents submitted as copies.
Based on the foregoing and subject to the assumptions and
qualifications set forth below, I am of the following
opinion:
1. Each of the Company, American, AMR Eagle Holding
Corporation, American Beacon Advisers, Inc., American Eagle
Airlines, Inc. and Execu-tive Airlines, Inc. has been duly
incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware and
has the corporate power and authority under such laws to
own its properties and to conduct its business as described
in the Prospectus. The Company is duly qualified to do
business as a foreign corporation in good standing in the
state in which its principal place of business is located,
and in each other state in which such qualification is
required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the
failure so to qualify or to be in good standing would not
result in a Material Adverse Effect. American holds an air
carrier op-erating certificate issued by the Secretary of
Transportation pursuant to Chapter 447 of Title 49 of the
United States Code, and American is a "citizen of the United
States" as defined in 49 U.S.C. Section 40102.
2. The Company has the corporate power and authority under
Delaware law to perform its obligations under the
Underwriting Agreement, and the Underwriting Agreement has
been duly authorized, validly executed and delivered by the
Company.
3. No authorization, approval, consent, order or license
of, or filing with, or the giving of notice to, any
government, governmental instrumentality, regulatory body or
authority or court is required to be made or obtained by the
Company for the valid authorization, issuance, sale and
delivery of the Shares, the valid authorization, execution,
delivery and performance by the Company of the Underwriting
Agreement, or the consummation by the Company or the transac-
tions contemplated thereby, except those that have
previously been obtained and are in full force and effect
and except such as may be required under the securities or
Blue Sky laws of the various states.
4. The Registration Statement has become effective under
the Securities Act and, to the best of my knowledge, no
stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that
purpose have been instituted or threatened.
5. The Registration Statement, the Prospectus and each
amendment thereof or supplement thereto (except in each case
for the financial statements and other financial or
statistical data included or incorporated by reference
therein, as to which I express no opinion) comply as to form
in all material respects with the requirements of the
Securities Act and the Securities Act Regulations.
6. The Shares have been duly authorized by the Company
and, when issued by the Company and delivered against
payment therefor in accordance with the Underwriting
Agreement, will be validly issued, fully paid and non-
assessable. The issuance of the Shares is not, under the
certificate of incorporation or by-laws of the Company, or
any agreement binding on the Company, subject to preemptive
or similar rights of any stockholder of the Company
7. The issuance and sale today by the Company of the
Shares to the Underwriter, the execution and delivery by the
Company of the Underwriting Agreement, the consummation by
the Company of the transactions therein contemplated in the
manner therein contemplated and compliance by the Company
with the terms thereof, do not and will not conflict with,
or result in a breach of, any of the terms or provisions of,
or constitute a default under the Certificate of
Incorporation or By-Laws, as amended, of the Company or any
indenture or other agreement or instrument known to me to
which the Company is a party or by which the Company or any
of their respective properties or assets is bound or any
law, rule, regulation, judgment, decree or order known to me
to be applicable to the Company of any court, regulatory
body, administrative agency, government or governmental body
having jurisdiction over the Company or any of their respec-
tive properties or assets (except that I express no opinion
as to the securities or Blue Sky laws of the various states,
the Securities Act, the 1939 Act, or the rules and
regulations thereunder).
8. The issued and outstanding shares of Common Stock have
been duly authorized and validly issued and are fully paid
and non-assessable.
9. I have no reason to believe that the statements in the
Registration Statement and the Prospectus with respect to
statutes, administrative orders and regulations and legal
and governmental proceedings do not fairly and accurately
present in all material respects the information required to
be set forth therein (except that I express no opinion as
to the matters addressed in the opinion set forth in
paragraph 8 of the Debevoise Opinion (as defined below)).
There are, to the best of my knowledge, no statutes,
administrative orders or regulations or legal or
governmental proceedings required to be described in the
Registration Statement or the Prospectus that are not
described as required, nor any contracts or documents of a
character required to be described in the Registration
Statement or the Prospectus, or to be filed as exhibits to
the Registration Statement, that are not so described or
filed as required. As used in this opinion letter, the term
"Debevoise Opinion" means the opinion of Debevoise &
Xxxxxxxx LLP, dated today and de-livered to you pursuant to
the Underwriting Agreement.
10. The routes presently operated by the Company are being
operated pursuant to valid certificates or exemption orders
issued by the Department of Transportation or its
predecessor, the Civil Aeronautics Board, and no such cer-
tificate or exemption order is the subject of any "show
cause" or other order of, or any proceeding before, or any
investigation by, the Department of Transportation or its
predecessor (other than proceedings for the renewal of
temporary rights), which in my opinion might reasonably
result in a final order impairing the validity of such
certificates or exemption orders.
11. The statements set forth in the Prospectus under the
caption "Description of Capital Stock of AMR Corporation -
Common Stock," insofar as such statements purport to
summarize certain terms of the Common Stock, fairly
summarize such provisions in all material respects.
12. Each document filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus (except in each
case for the financial statements and other financial or
statistical data included or incorporated therein, as to
which I express no opinion) appeared on its face, as of its
respective filing date, to comply as to form in all material
respects with the requirements of the Exchange Act and the
rules and regulations thereunder.
13. The Company is not, and after giving effect to the
offering and sale of the Shares in the manner contemplated
in the Underwriting Agreement and the Prospectus Supplement
will not be, an "investment company" (as defined in the
Investment Company Act of 1940, as amended).
I express no opinion as to the laws of any jurisdiction
other than the laws of the States of Texas and New York, the
General Corporation Law of the State of Delaware and the
federal laws of the United States of America, except that I
express no opinion with respect to the antitrust,
bankruptcy, environmental or tax laws of any jurisdiction.
No facts have come to my attention which have caused me to
believe (A) that the Registration Statement (except, in each
case, for the financial statements, the related notes and
schedules, and other financial or statistical information
included or incorpo-rated by reference therein or omitted
therefrom, and except for the Statement of Eligibility on
Form T-1 of the Trustee under the Indenture, as to which I
express no belief), as of the effective date, contained any
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading, or (B) that the
Prospectus (except for the financial statements, the related
notes and schedules, and other financial or statistical
information included or incorporated by reference therein
or omitted therefrom, as to which I express no belief), as
of the date of the Prospectus Supplement and as of the date
hereof, contained or contains any untrue statement of a
material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
This opinion letter is limited to the matters stated, and no
opinion is implied or may be inferred beyond those opinions
expressly stated herein. The opinions expressed herein are
rendered only as of the date hereof, and I assume no
responsibility to advise you of changes in law, facts,
circumstances, events or developments which hereafter may be
brought to my attention and which may alter, affect or
modify such opinions.
The opinions expressed herein are solely for the benefit of
the addressees of this opinion letter, and without my prior
written consent may not be relied on in any other context,
quoted in whole or in part or otherwise referred to in any
legal opinion, docu-ment, or other report, or furnished to
any other person or entity.
Very truly yours,
EXHIBIT B
FORM OF OPINION OF DEBEVOISE & XXXXXXXX LLP
SPECIAL COUNSEL FOR THE COMPANY,
TO BE DELIVERED PURSUANT TO SECTION 5(a)
___________, 2005
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
AMR Corporation
Ladies and Gentlemen:
We have acted as special counsel to AMR Corporation, a
Delaware corporation (the "Company"), in connection with (a)
the issuance and sale today by the Company of _______ shares
(the "Shares") of Common Stock, par value $1.00 per share
(the "Common Stock"), of the Company to you pursuant to the
Underwriting Agreement, dated _______, 2005 (the "Under-
writing Agreement"), among the Company and you; (b) the
preparation and filing with the Securities and Exchange
Commission (the "SEC") under the Securities Act of 1933, as
amended (the "1933 Act"), of the Registration Statements on
Form S-3 (Registration Nos. 333-110760 and 333-110760-01)
relating to certain securities of the Company (together, the
"Registration Statement") and the Prospectus Supplement,
dated _________ 2005, relating to the Shares (the "Pro-
spectus Supplement" and, together with the base prospectus
included in the Registration Statement as of the effective
date thereof, the "Prospectus"); and (c) the preparation of
the Underwriting Agreement. We are delivering this letter
to you pursuant to Section 5(a) of the Underwriting
Agreement.
In connection with this opinion, we have examined the
Underwriting Agreement, the Registration Statement and the
Prospectus, and originals or certified, conformed or
reproduction copies of such agreements, instruments,
documents and records of the Company, such certificates of
public officials, and such other documents, and have made
such investigations of law, as we have deemed necessary or
appropriate for the purposes of this opinion. In all such
examinations, we have assumed the legal capacity of all
natural persons executing documents, the genuineness of all
signatures on original or certified copies, the authenticity
of all original or certified copies and the conformity to
original or certified documents of all copies submitted to
us as conformed or reproduction copies. We have relied as
to factual matters upon, and have assumed the accuracy of,
the statements made in the certificates of officers of the
Company delivered to us, the representations and warranties
of the parties to the Underwriting Agreement that are con-
tained in or made pursuant to the Underwriting Agreement,
and certificates and other statements or information of or
from public officials and officers and representatives of
the Company and others (including, without limitation, the
Underwriter). We have assumed performance of and compliance
with the covenants and agreements contained in the
Underwriting Agreement by the parties thereto.
Based on the foregoing, and subject to the limitations,
qualifications and assumptions set forth herein, we are of
the opinion that:
1. The Company has the corporate power and authority to
execute, deliver and perform its obligations under the
Underwriting Agreement.
2. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
3. The Shares have been duly authorized by the Company
and, when issued by the Company and delivered against
payment therefor in accordance with the Under-writing
Agreement, will be validly issued, fully paid and non-
assessable. The issuance of the Shares is not, under the
certificate of incorporation or by-laws of the Company, sub-
ject to preemptive rights of any stockholder of the Company.
4. The statements set forth in the Prospectus under the
caption "Description of Capital Stock of AMR Corporation -
Common Stock," insofar as such statements purport to
summarize certain terms of the Common Stock, fairly
summarize such terms in all material respects.
5. The execution, delivery and performance by the Company
of the Underwriting Agreement did not, and the issuance and
sale today by the Company of the Shares to the Underwriter
will not, (i) violate the certificate of incorporation or by-
laws of the Company or (ii) to our knowledge, violate any
existing United States Federal or New York State statute
applicable to the Company or any rule or regulation known to
us of any United States Federal or New York governmental
agency or body having jurisdiction over the Company
(provided that we express no opinion as to any applicable
securities laws, statutes, rules or regulations, except as
stated in the following paragraph 7.)
6. No authorization, approval, consent, order or license
of, or filing or registration with, any United States
Federal or New York governmental agency or body known to us
to have jurisdiction over the Company is required to be
obtained by the Company on or prior to the date hereof for
the execution, delivery and performance by the Company of
the Underwriting Agreement or the issuance and sale today by
the Company of the Shares to the Underwriter pursuant to
the Underwriting Agreement, except (a) as disclosed in the
Prospectus or as have been obtained or made or (b) as may be
required under or pursuant to applicable securities laws,
statutes, rules or regulations (as to which we express no
opinion except as stated in the following paragraph 7).
7. The Registration Statement has become effective under
the 1933 Act.
8. The statements in the Prospectus Supplement under the
caption "Certain United States Federal Income Tax
Consequences for Non-U.S. Holders", insofar as such
statements purport to summarize certain provisions of the
laws referred to therein, fairly summarize such provisions
in all material respects.
The opinions set forth above are subject to the following
additional qualifications and as-sumptions:
(a) The opinions expressed above are limited to the
Federal laws of the United States of America, the laws of the
State of New York and the General Corporation Law of the State
of Delaware, as currently in effect.
(b) For purposes of the opinions set forth above, we
have considered, and express an opinion with respect to, only
those laws, statutes, rules and regulations that in our
experience are normally applicable to transactions of the
type contemplated by the Underwriting Agreement, and in
particular we do not express any opinion concerning aviation
laws (including without limitation Title 49 of the U.S.
Code), or other laws, statutes, rules or regulations
applicable to the particular nature of the business
conducted by the Company.
(c) Our opinions are subject to the effects of, and we
express no opinion with respect to the application of or
compliance with, any state securities or "blue sky" laws,
statutes, rules or regulations.
(d) In rendering the opinion set forth in paragraph 7
above concerning the effectiveness of the Registration Statement,
we have relied exclusively on the telephone advice of the
Staff of the SEC.
* * * * *
We have not ourselves checked the accuracy or completeness
of, or otherwise verified, and are not passing upon and
assume no responsibility for the accuracy or completeness
of, the statements contained in the Registration Statement
or the Prospectus, except to the limited extent stated in
paragraph 4 above. In the course of our review and
discussion of the contents of the Registration Statement and
the Prospectus with certain officers and employees of the
Company and its independent accountants, but without
independent check or verification, no facts have come to our
attention which have caused us to believe (A) that the
Registration Statement (except for the financial
statements, the related notes and schedules, and other
financial or statistical information included or
incorporated by reference therein or omitted therefrom, as
to which we express no belief), as of the effective date
thereof, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, or (B) that the Prospectus (except for the
financial statements, the related notes and schedules, and
other financial or statistical information included or
incorporated by reference therein or omitted therefrom, as
to which we express no belief), as of the date of the
Prospectus Supplement and as of the date hereof, contained
or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary in order
to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
* * * * *
We assume no obligation to supplement this letter if any
applicable laws change after the date hereof or if we become
aware of any facts that might change the opinions and
beliefs expressed herein after the date hereof. The
opinions and beliefs expressed herein are solely for your
benefit and may not be relied upon in any manner or for any
purpose by any other person and may not be quoted or
disclosed in whole or in part without our prior written
consent.
Very truly yours,
