EXHIBIT 10.1
Execution Version
LOAN AGREEMENT [ENGINES]
DATED AS OF SEPTEMBER 3, 2004
AMONG
AMERICA WEST AIRLINES, INC.,
GENERAL ELECTRIC CAPITAL CORPORATION,
AS ADMINISTRATIVE AGENT
GENERAL ELECTRIC CAPITAL CORPORATION,
AS ORIGINAL SERIES A LENDER,
GENERAL ELECTRIC CAPITAL CORPORATION
AS ORIGINAL SERIES B LENDER
XXXXX FARGO BANK NORTHWEST, NATIONAL ASSOCIATION
AS SECURITY TRUSTEE
AND
THE LENDERS
FROM TIME TO TIME PARTY HERETO
TABLE OF CONTENTS
PAGE
ARTICLE I THE LOAN ...................................................................................... 1
Section 1.1. The Loan............................................................................... 1
Section 1.2. Making the Loan........................................................................ 3
Section 1.3. Fees................................................................................... 4
Section 1.4. Commitment Termination................................................................. 4
Section 1.5. [Intentionally omitted.]............................................................... 4
Section 1.6. Substitute Lenders..................................................................... 5
Section 1.7. Special Provisions Governing the Loan.................................................. 5
Section 1.8. Payments and Computations.............................................................. 7
Section 1.9. Sharing of Payments, Etc............................................................... 8
Section 1.10. Obligation of Lenders to Mitigate..................................................... 8
Section 1.11. Replacement Notes..................................................................... 9
ARTICLE II INTEREST ..................................................................................... 9
Section 2.1. Rate of Interest....................................................................... 9
Section 2.2. Interest Periods....................................................................... 9
(a) Interest Periods..................................................................... 9
(b) Expiration of Interest Periods....................................................... 9
Section 2.3. Interest Payments...................................................................... 9
Section 2.4. Default Rate........................................................................... 9
Section 2.5. Computation of Interest................................................................ 10
Section 2.6. Maximum Rate........................................................................... 10
ARTICLE III REPRESENTATIONS AND WARRANTIES............................................................... 10
Section 3.1. Representations and Warranties......................................................... 10
(a) Organization; Powers................................................................. 10
(b) Authorization; Enforceability........................................................ 10
(c) No Violation......................................................................... 11
(d) Governmental Approvals............................................................... 11
(e) Litigation........................................................................... 11
(f) Financial Condition.................................................................. 11
(g) No Default........................................................................... 12
(h) Investment and Holding Company Status................................................ 12
(i) Use of Proceeds...................................................................... 12
(j) Licenses, Permits, etc............................................................... 12
(k) Compliance with Laws................................................................. 12
(l) Tax Returns.......................................................................... 12
(m) Information.......................................................................... 12
Section 3.2. The Engines............................................................................ 13
(a) Good Title........................................................................... 13
(b) Filings.............................................................................. 13
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TABLE OF CONTENTS
(CONTINUED)
(c) No Event of Loss.................................................................. 13
(d) Section 1110...................................................................... 13
(e) Conditions........................................................................ 13
Section 3.3. Representations and Warranties of the Security Trustee................................ 13
(a) Powers and Authorizations......................................................... 13
(b) Litigation........................................................................ 14
(c) No Legal Bar...................................................................... 14
Section 3.4. Representations and Warranties of the Lenders......................................... 14
(a) Accredited Investor............................................................... 14
(b) Investment Intent................................................................. 14
(c) ERISA............................................................................. 14
(d) No Offering....................................................................... 14
ARTICLE IV COVENANTS ................................................................................... 15
Section 4.1. Covenants of the Borrower......................................................... 15
(a) Financial Statements and Other Information........................................ 15
(b) Existence; Conduct of Business.................................................... 16
(c) Mergers and Consolidations........................................................ 17
(d) Delivery of Post-Recording FAA Opinion............................................ 18
(e) Engine Reports.................................................................... 18
(f) Compliance with Mortgage.......................................................... 18
ARTICLE V INCREASED COSTS; GENERAL INDEMNITY............................................................ 18
Section 5.1. Increased Costs....................................................................... 18
Section 5.2. Capital Adequacy...................................................................... 19
Section 5.3. Withholding of Taxes.................................................................. 20
(a) Payments to Be Free and Clear....................................................... 20
(b) Grossing-up of Payments............................................................. 20
(c) Evidence of Exemption from U.S. Withholding Tax..................................... 21
Section 5.4. (a) Other Taxes.................................................................. 24
(b) Contest of Tax Claims........................................................ 24
(c) Non-Parties.................................................................. 25
Section 5.5. Indemnity............................................................................. 25
ARTICLE VI CONDITIONS PRECEDENT......................................................................... 27
Section 6.1. General Conditions.................................................................... 27
Section 6.2. Additional Conditions................................................................. 28
ARTICLE VII EVENTS OF DEFAULT........................................................................... 31
Section 7.1. Events of Default..................................................................... 31
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TABLE OF CONTENTS
(CONTINUED)
ARTICLE VIII THE TRANSACTION AGENTS..................................................................... 33
Section 8.1. Appointment and Authorization......................................................... 33
Section 8.2. Delegation of Duties.................................................................. 33
Section 8.3. Exculpatory Provisions................................................................ 33
Section 8.4. Reliance by Transaction Agents........................................................ 34
Section 8.5. Notice of Events of Default........................................................... 34
Section 8.6. Non-Reliance on Transaction Agents and Other Lenders; Lender
Representations................................................................... 34
Section 8.7. Transaction Agents and Affiliates..................................................... 34
Section 8.8. Indemnification....................................................................... 35
Section 8.9. Successor Transaction Agents.......................................................... 35
Section 8.10. Qualifications of Successor Security Trustee......................................... 35
ARTICLE IX MISCELLANEOUS................................................................................ 35
Section 9.1. Amendments............................................................................ 35
Section 9.2. Notices............................................................................... 36
Section 9.3. Costs and Expenses.................................................................... 36
Section 9.4. Certain Agreements.................................................................... 36
Section 9.5. Entire Agreement...................................................................... 36
Section 9.6. Cumulative Rights and Severability.................................................... 37
Section 9.7. Waivers............................................................................... 37
Section 9.8. Successors and Assigns; Participations; Assignments................................... 37
(a) Successors and Assigns.............................................................. 37
(b) Participations...................................................................... 37
(c) Assignments......................................................................... 37
(d) Register............................................................................ 38
Section 9.9. Confidentiality....................................................................... 38
Section 9.10. Counterparts......................................................................... 39
Section 9.11. Governing Law; Submission to Jurisdiction; Venue..................................... 39
Section 9.12. Waiver of Trial by Jury.............................................................. 40
Section 9.13. Effective Date....................................................................... 40
Schedule 1 Definitions
Schedule 2 Engine Descriptions, Stipulated Loss Values and Termination Values
Schedule 3 Principal Payments for the Notes
Schedule 4 Certain Information
EXHIBIT A-1 Form of Mortgage
EXHIBIT A-2 Form of Subordinated Mortgage
EXHIBIT B Form of Promissory Note
EXHIBIT C Form of Notice of Borrowing
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TABLE OF CONTENTS
(CONTINUED)
EXHIBIT D Form of Opinion of Special Counsel to the Borrower for Closing
EXHIBIT E Form of Opinion of Borrower's Legal Department for Closing
EXHIBIT F Form of Transfer Supplement
EXHIBIT G Form of Certificate of Non-Bank Status
EXHIBIT H Form of FAA Counsel's Opinion
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LOAN AGREEMENT [ENGINES]
THIS LOAN AGREEMENT [ENGINES], dated as of September 3, 2004 (this
"Agreement"), is among AMERICA WEST AIRLINES, INC., a Delaware corporation (the
"Borrower"), GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as
Administrative Agent for the Lenders (the "Administrative Agent"), XXXXX FARGO
BANK NORTHWEST, National Association, as the Security Trustee (the "Security
Trustee"), GENERAL ELECTRIC CAPITAL CORPORATION (herein called the "Original
Series A Lender"), and GENERAL ELECTRIC CAPITAL CORPORATION (herein called the
"Original Series B Lender") and such other lenders as may from time to time be
party hereto (together with the Original Series A Lender and the Original Series
B Lender, the "Lenders"). Certain capitalized terms used herein are defined, and
certain rules of construction are specified, in Schedule 1.
BACKGROUND
l. The Lenders have agreed to make loans to the Borrower to be secured
by a Lien on certain engines owned by the Borrower.
2. connection with such loans, the parties hereto wish to enter into
certain related understandings, as set forth herein.
The parties hereto agree as follows:
ARTICLE I
THE LOAN
Section 1.1. The Loan.
(a) Commitments. Subject to the terms and conditions of this Loan
Agreement, on the Funding Date the Original Series A Lender shall make a loan to
the Borrower in the principal amount equal to the Series A Commitment, and the
Original Series B Lender shall make a loan to the Borrower in the principal
amount equal to the Series B Commitment. As evidence of the loan advanced by the
Original Series A Lender, on the Funding Date the Borrower shall issue and
deliver to the Original Series A Lender, as provided hereunder, a Series A Note
payable to the Original Series A Lender in an original principal amount equal to
the amount of its Series A Commitment. As evidence of the loan advanced by the
Original Series B Lender, on the Funding Date the Borrower shall issue and
deliver to the Original Series B Lender, as provided hereunder, a Series B Note
payable to the Original Series B Lender in an original principal amount equal to
the amount of the Series B Commitment. The Notes and the Security Trustee's form
of certificate of authentication to appear on the Notes shall each be
substantially in the form set forth in Exhibit B.
(b) The Notes: Amortization. Each Series of Notes shall have the stated
maturity set forth on Schedule 3 with respect to such Series (or in the case of
a Replacement Note, as set forth in such Replacement Note), and the principal of
each Note shall be payable in installments on the Payment Dates, each such
installment to be in an amount computed by multiplying the original
principal amount of such Note by the ratio set forth in Annex A to such Note
opposite the Payment Date on which such installment is due; provided that, in
the event that the Notes shall have been prepaid in part pursuant hereto
(regardless of whether such prepayment is made pursuant to subparagraphs (c) or
(d) of this Section 1.1 or pursuant to Section 1.7), from and after the relevant
Prepayment Date or at any time pursuant to Section 1.7 or on an Engine Payment
Date (as the case may be), the amounts of such installments shall be reduced, in
inverse order of maturity, by the amount of such partial prepayment. Annex A to
each Note of any Series shall be completed based on the "Percentage of Original
Principal Amount to be Paid" for such Series as set forth in Schedule 3. In the
case of each Note, each payment of the principal amount, LIBOR Breakage Costs,
if any, and interest or other amounts due thereon shall be applied, first, to
the payment of any amounts due in respect of the Loan (other than principal and
accrued interest on the Loan and LIBOR Breakage Costs) to the date of such
payment (including any interest on overdue principal amount, LIBOR Breakage
Costs, if any, and to the extent permitted by law, interest and other amounts
thereunder), second, to the payment of accrued interest on the Loan to the date
of such payment, third, to the payment of LIBOR Breakage Costs, if any, due
hereunder in respect of the Loan, and fourth, the balance, if any, remaining
thereafter, to the payment of the principal amount of the Loan remaining unpaid
(provided that the Loan shall not be subject to prepayment, except as provided
in Sections 1.1(c), 1.1(d) and 1.7 hereof).
(c) Optional Prepayment.
(i) In General. The Borrower may not, except as otherwise
expressly provided in this Agreement, prepay the Loan (or any portion thereof)
prior to the Designated Date. On or after the Designated Date, on any Business
Day (a "Prepayment Date"), on not less than three Business Days' prior
irrevocable written notice from the Borrower to the Administrative Agent, the
Borrower may prepay all, or any portion of the outstanding principal amount of
the Loan; provided, however, that no partial prepayment of the Loan shall be for
less than $5,000,000 original principal amount. If the Borrower elects to prepay
the Loan, the Borrower shall pay on the Prepayment Date to the Administrative
Agent the outstanding principal amount of the Loan subject to prepayment
together with all accrued and unpaid interest thereon, any LIBOR Breakage Costs,
the Prepayment Fee (if applicable), and all other amounts then due and payable
under the Transaction Documents.
(ii) Limited Optional Prepayment. Notwithstanding anything to the
contrary in Section 1.1(c)(i) above and without limiting the Borrower's
obligations under Sections 5.1, 5.2 and 5.3, in the event that the Borrower
receives notice from any Lender of any costs that the Borrower is required to
pay to such Lender pursuant to any of Sections 5.1, 5.2 or 5.3, the Borrower and
such Lender shall negotiate in good faith in order to arrive at a mutually
acceptable alternative means of structuring the Loan Amount held by such Lender
in order to mitigate, minimize or eliminate such costs in the future. In the
event that the Borrower and such Lender are not able to agree, within thirty
(30) days following the date of the notice to the Borrower of amounts due under
any of Section 5.1, 5.2 or 5.3, as the case may be, on an alternative means of
structuring the Loan Amount held by such Lender, then the Borrower shall have
the right, exercisable upon not less than ten Business Days' prior notice to the
applicable Lender (with a copy to the Administrative Agent), to prepay in full
the Loan Amount held by such Lender, together with accrued interest thereon, any
LIBOR Breakage Costs and any amounts due to such Lender pursuant to Sections
5.1, 5.2 and 5.3, as applicable. Any
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prepayment by the Borrower pursuant to this Section 1.1(c)(ii) shall be made by
the Borrower directly to the applicable Lender, and no prepayment by the
Borrower pursuant to this Section 1.1(c)(ii) shall have any effect on the
Borrower's obligations with respect to the remaining outstanding balance of the
Loan to any of the other Lenders hereunder. For the avoidance of doubt such
prepayment would not be subject to any Prepayment Fee, may be made prior to the
Designated Date and may be in an amount less than $5,000,000.
(d) Mandatory Prepayment. If an Event of Loss occurs with respect to any
Engine and the Borrower elects not to substitute another engine for such Engine
in accordance with the Mortgage (or if the Borrower so elects, but does not
substitute another engine for such Engine in accordance with the Mortgage) or if
a Permitted Disposition occurs with respect to any Engine, the Borrower shall,
on the date specified for payment with respect to such Event of Loss in Section
3.04(a)(i) of the Mortgage or such Permitted Disposition in Section 3.04(h) of
the Mortgage (in either case, the "Engine Payment Date"), prepay the Loan in a
principal amount equal to the amount determined pursuant to the immediately
following sentence, together with accrued interest thereon to the date of such
prepayment plus any LIBOR Breakage Costs. The amount of principal to be prepaid
pursuant to this Section 1.1(d) with respect to any Engine will be equal to the
amount set forth opposite such Engine (or the Engine which such Engine has
replaced) under the appropriate heading on Schedule 2 as follows: "Stipulated
Loss Value-A" (with respect to an Event of Loss that occurs prior to the
Designated Dated), "Stipulated Loss Value-B" (with respect to an Event of Loss
that occurs on or after the Designated Date), or "Termination Value" (if Section
3.04(h)(3)(ii) of the Mortgage is applicable). For the avoidance of doubt such
prepayment would not be subject to any Prepayment Fee, may be made prior to the
Designated Date and may be in an amount less than $5,000,000.
(e) Pro Rata Treatment. Except to the extent otherwise provided herein
(including, but not limited to, as otherwise specified in Section 1.1(c)(ii)
above and Section 1.6 below): (a) the borrowing of the Loan from the Lenders
under Section 1.2 shall be made from the Lenders pro rata according to the
amounts of their respective Commitments; (b) each payment or prepayment of
principal of the Loan shall be made for account of the Lenders pro rata in
accordance with the respective unpaid principal amounts of the Loan held by them
(as evidenced by the Notes, regardless of Series, held by them); and (c) each
payment of interest on the Loan shall be made for account of the Lenders pro
rata in accordance with the amounts of interest on the Loan then due and payable
to the Lenders, but must in all respects comply with the terms of the Mortgage.
Section 1.2. Making the Loan.
(a) The Loan shall be requested by the delivery of a Notice of
Borrowing by the Borrower to the Administrative Agent not later than 4:00 p.m.
(New York City time) on the third Business Day prior to the Funding Date
specified in such notice. The Administrative Agent shall give to each Lender
prompt notice thereof. The Notice of Borrowing shall be irrevocable and binding
on the Borrower. The Notice of Borrowing shall be in writing specifying therein
the (i) the aggregate amount of the Loan to be funded, and (ii) the proposed
Funding Date. The Original Series A Lender and the Original Series B Lender
shall, before 10:00 a.m. (New York City time) on the scheduled Funding Date,
make available for the account of its Lending Office to the Administrative
Agent's Account, in immediately available funds, the Series A
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Commitment and the Series B Commitment respectively. After the Administrative
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article VI as confirmed during a closing conference call pursuant
to which the Administrative Agent or its counsel shall indicate such
fulfillment, the Administrative Agent shall transfer such funds to the Borrower
at its account at Bank One Arizona, N.A. (ABA No. 122-100-024), Account Number
00000000.
(b) If for any reason a Closing is not consummated on the Funding Date
set forth in the Notice of Borrowing, the Borrower may, by written notice to the
Administrative Agent given by 5:00 p.m., New York City time on the scheduled
Funding Date, designate a delayed Funding Date for such Closing, in which case
the Administrative Agent shall hold the funds provided by the Lenders until such
delayed Funding Date and use reasonable efforts to invest such funds in
Permitted Investments, as directed by the Borrower, provided, that if such
Closing does not occur by the third Business Day after such initial scheduled
Funding Date, such funds shall be returned to the Lenders. The Administrative
Agent shall pay to the Borrower upon its request any earnings from such
investments, and the Borrower shall pay to the Administrative Agent upon its
request any losses from such investments. If the Closing fails to occur on a
scheduled or delayed Funding Date and the Borrower does not give notice of a
delayed Funding Date pursuant to this Section, the Administrative Agent shall
promptly return to the Lenders the amounts funded by them and the Borrower shall
pay to the Lenders upon demand LIBOR Breakage Costs with respect to amounts
funded plus, in the case of failure to close on a delayed Funding Date, interest
from and including the initial scheduled Funding Date to but excluding the date
on which such funds are returned by 1:00 p.m. (New York City time) (or, if
returned after such time on such date, to but excluding the next Business Day),
at a rate per annum equal to the relevant LIBOR Rate plus the Applicable Margin
that would have been applicable thereto had the Closing occurred on the initial
scheduled Funding Date. If the Borrower has designated a delayed Funding Date
pursuant to this Section and the Closing occurs on such delayed Funding Date,
the Loan shall begin to accrue interest at the relevant LIBOR Rate plus the
Applicable Margin on the date that funds were originally provided by the Lenders
to the Administrative Agent to make the Loan (which shall be deemed to be the
commencement date of the initial Interest Period for the Loan); provided,
however, if all conditions precedent specified in Article VI are satisfied in
full on or before the initial scheduled Funding Date and the Closing does not
occur on the initial scheduled Funding Date solely due to the failure of the
Lenders to fund the Loan pursuant to their respective Commitments hereunder (but
the Closing does occur later pursuant to this Section 1.2(b)), then the Loan
shall begin to accrue interest only on the date that the Closing actually occurs
(rather than from the initial scheduled Funding Date).
Section 1.3. Fees. The Borrower shall pay to the Administrative Agent on
the Funding Date an upfront fee in the amount agreed to separately with the
Administrative Agent in writing.
Section 1.4. Commitment Termination. The Aggregate Commitment and the
Commitment of each Lender shall terminate on the earlier of (i) the making of
the Loan pursuant to Section 1.2(a) above, or (ii) at 5:00 p.m. (New York time)
on the Commitment Termination Date.
Section 1.5. [Intentionally omitted.].
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Section 1.6. Substitute Lenders. In the event the Borrower is required
under the provisions of Section 5.1, 5.2 or 5.3 to make payments to any Lender,
a notice has been given to the Borrower under Section 1.7(g) and the Borrower
and a Lender are unable to agree on a Substitute Basis or an Affected Lender has
given notice to the Borrower under Section 1.7(c) and the Borrower and the
Affected Lender are unable to agree on a Substitute Basis, the Borrower may, so
long as no Potential Default under clause (a), (e) or (f) of Section 7.1 or
Event of Default shall have occurred and be continuing, elect to terminate such
Lender (or Affected Lender) as a party to this Agreement; provided that
concurrently with such termination, (i) the Borrower shall pay or cause to be
paid to that Lender (or Affected Lender) all principal, interest, LIBOR Breakage
Costs and fees and other Obligations (including, without limitation, amounts, if
any, owed under Sections 5.1, 5.2 and 5.3) due to such Lender (or Affected
Lender) through such date of termination, (ii) another financial institution
reasonably satisfactory to the Borrower and the Administrative Agent shall
agree, as of such date, to become a Lender for all purposes under this Agreement
(whether by assignment or amendment) and to assume all obligations of the Lender
(or Affected Lender) to be terminated as of such date, and (iii) all documents
and supporting materials necessary, in the reasonable judgment of the
Administrative Agent, to evidence the substitution of such Lender shall have
been received and approved by the Administrative Agent as of such date.
Section 1.7. Special Provisions Governing the Loan. Notwithstanding any
other provision of this Agreement to the contrary, the following provisions
shall govern with respect to the Loans as to the matters covered:
(a) As soon as practicable after 11:00 a.m. (London time) on each
Interest Rate Determination Date, the Administrative Agent shall determine the
interest rate that shall apply to each Series of Notes for the applicable
Interest Period (which determination shall be prima facie evidence of such rate)
and shall promptly give notice thereof (in writing or by telephone confirmed in
writing) to the Borrower, the Security Trustee and each Lender; provided that
the Administrative Agent's failure to so give notice shall not relieve the
Borrower of its obligation to pay interest on the Notes hereunder.
(b) [Intentionally omitted].
(c) In the event that on any date the making, maintaining or
continuation by any Lender of its Percentage Share of the Loan as evidenced by
its Notes has become unlawful as a result of compliance by such Lender in good
faith with any change that becomes effective after the date hereof in any law,
treaty, governmental rule, regulation, guideline or order (whether or not having
the force of law), then, and in any such event, such Lender shall be an
"Affected Lender" and it shall promptly so notify (by facsimile or by telephone
confirmed in writing) the Borrower and the Security Trustee (which notice the
Security Trustee shall promptly transmit to each other Lender). Thereafter (i)
the obligation of the Affected Lender to make its Percentage Share of the Loan
as evidenced by its Notes (if not yet funded) shall be suspended until such
notice shall be withdrawn by the Affected Lender, (ii) the Affected Lender's
obligation to maintain its outstanding Loan Amount as evidenced by its Notes
(the "Affected Loan Amount") shall be suspended with respect to the Affected
Loan Amount until such notice shall be withdrawn by the Affected Lender, and
(iii) the parties shall follow the procedures set forth in Section 1.7(f) with
respect to the Affected Loan Amount so long as, if following such
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procedures, the maintaining continuation of such Affected Loan Amount or the
balance of the Loan is not unlawful. The Borrower may elect to terminate such
Affected Lender as a party to this Agreement in compliance with Section 1.6.
Except as provided in the immediately preceding sentence, nothing in this
Section 1.7(c) shall affect the obligation of any Lender other than an Affected
Lender to make its Percentage Share of the Loan or maintain its Loan Amount as
evidenced by its Notes in accordance with the terms of this Agreement.
(d) The Borrower shall compensate each Lender, within ten (10) Business
Days after written request by that Lender (which request shall set forth in
reasonable detail the basis for requesting such amounts), for all reasonable
losses, costs, expenses and liabilities (including any interest paid by that
Lender to lenders of funds borrowed by it to make or carry its Loan Amount as
evidenced by its Notes and any loss, expense or liability sustained by that
Lender in connection with the liquidation or re-employment of such funds)
(collectively, "LIBOR Breakage Costs") which that Lender may sustain: (i) except
as provided in Section 1.2(b), if for any reason (other than a default by that
Lender) a borrowing of the Loan does not occur on a date specified therefor in a
Notice of Borrowing, (ii) as a consequence of any prepayment or other principal
payment of the Loan or any portion thereof that occurs on a date other than the
last day of an Interest Period, (iii) to the extent that any prepayment of the
Loan or any portion thereof is not made on any date specified in a notice of
prepayment given by the Borrower (including, without limitation, any notice of
prepayment revoked by the Borrower), (iv) as a consequence of the replacement of
such Lender pursuant to Section 1.6 or (v) as a consequence of any default by
the Borrower in the repayment of the Loan when required by the terms of this
Agreement.
(e) In the case of any Lender, LIBOR Breakage Costs shall not exceed the
excess, if any, of (A) the amount of interest which would have accrued on the
principal amount of such Lender's Loan Amount (or in the case of an event
described in subclause (i) of Section 1.7(c) above, such Lender's Percentage
Share) had such event not occurred, at the LIBOR Rate that would have been
applicable to the Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, for the period that would have been the Interest Period for the Loan)
(the "BREAK PERIOD"), over (B) the interest that would have accrued on such
amount during the Break Period at an interest rate equal to the LIBOR Rate
(determined two Business Days prior to the first day of the Break Period) with a
maturity comparable to the Break Period (or, if no such rate exists for such
period, the rate determined from the applicable Bloomberg screen using standard
interpolation methodologies by reference to the next higher and next lower
available maturities (as determined by the Administrative Agent). A certificate
of any Lender setting forth any amount or amounts that such Lender is entitled
to receive pursuant to this Section shall be delivered to the Borrower and shall
be prima facie evidence of amounts owed under this Section. The Borrower shall
pay such Lender the amount shown as due on any such certificate within 10 days
after receipt thereof.
(f) During the 30 days following the date of any notice given to the
Borrower pursuant to Section 1.7(c) or 1.7(g), each Affected Lender (or, in the
case of Section 1.7(g), each Lender) and the Borrower shall negotiate in good
faith in order to arrive at a mutually acceptable alternative basis for
determining the interest rate from time to time applicable to the Affected Loan
Amount (or, in the case of Section 1.7(g), the Loan) (the "Substitute Basis");
such interest rate to be based on an agreed cost-of-funds benchmark plus the
Applicable Margin. If within the 30 days following the date of any such notice
to the Borrower, any Affected Lender (or, in the
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case of Section 1.7(g), any Lender) and the Borrower shall agree upon a
Substitute Basis, such Substitute Basis shall be retroactive to and effective
from the first day of the applicable Interest Periods until and including the
last day of such Interest Periods. If after 30 days from the date of such
notice, any Affected Lender (or, in the case of Section 1.7(g), any Lender) and
the Borrower shall have failed to agree upon a Substitute Basis, then each such
Affected Lender (or, in the case of Section 1.7(g), each such Lender) shall
certify in writing to the Borrower through the Security Trustee (such
certification to be conclusive and binding on all of the parties hereto absent
manifest error) the interest rate at which such Affected Lender (or, in the case
of Section 1.7(g), such Lender) is prepared to make or maintain the Affected
Loan Amount (or, in the case of Section 1.7(g), its Loan Amount) for such
Interest Periods, such interest rate to be retroactive to and effective from the
first day of such Interest Period. If no Substitute Basis is established, upon
receipt of notice of the interest rates at which an Affected Lender (or, in the
case of Section 1.7(g), a Lender) is prepared to make or maintain its affected
Loans, the Borrower shall have the right (i) exercisable upon ten Business Days'
prior notice to such Affected Lender (or such Lender) through the Security
Trustee (A) to continue to borrow the relevant Loan Amount at the interest rates
so advised by such Affected Lender (or such Lender) (as such rates may be
modified, from time to time, at the outset of each subsequent Interest Period)
or (B) to prepay in full the affected Loan Amount of any such Affected Lender
(or any such Lender), together with accrued interest thereon at the interest
rate certified in writing by such Affected Lender (or such Lender) as provided
above and any LIBOR Breakage Costs (provided that LIBOR Breakage Costs shall not
include amounts attributable to an Affected Lender's (or in the case of Section
1.7(g), a Lender's) funding commitment of greater than three months), whereupon
such affected Loan Amount shall become due and payable on the date specified by
the Borrower in such notice or (ii) to substitute any such Affected Lender (or
such Lender) pursuant to the provisions of, and subject to the conditions
contained in, Section 1.6.
(g) In the event that on any Interest Rate Determination Date, by reason
of circumstances affecting the interbank Eurodollar market, adequate and fair
means do not exist for ascertaining the interest rate applicable to the Loan on
the basis provided for in the definition of LIBOR Rate, the Administrative Agent
shall on such date give notice (by facsimile or by telephone confirmed in
writing) to the Borrower and each Lender of such circumstance, whereupon the
relevant provisions of Section 1.7(f) shall be applicable.
Section 1.8. Payments and Computations.
(a) The Borrower shall make each payment hereunder and under the Notes
not later than 12:30 p.m. (New York City time) on the day when due in Dollars to
the Administrative Agent's Account in immediately available funds, without
set-off or counterclaim (except for any required withholding taxes not subject
to indemnification hereunder). Any amounts received after such time may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for the purpose of calculating interest thereon.
The Administrative Agent will promptly thereafter but in no event later than
2:00 p.m. (New York City time) on the date such funds are received by the
Administrative Agent from the Borrower cause to be distributed like funds to the
Lenders for the account of their respective Lending Offices, in each case to be
applied in accordance with the terms of this Agreement. If the payment by the
Borrower is received by the Administrative Agent after 12:30 p.m., New York
time, at the place of payment, the Administrative Agent shall make payment
promptly, but
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not later than 2:00 p.m. New York time on the next succeeding Business Day. Upon
its acceptance of any Transfer Supplement and recording of the information
contained therein in the Register pursuant to Section 9.8(d), from and after the
effective date specified in such Transfer Supplement, the Administrative Agent
shall make all payments hereunder and under the Notes in respect of the interest
assigned thereby to the Lender assignee thereunder.
(b) Whenever any payment hereunder or under the Notes shall be stated to
be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or other amounts as the case
may be; provided, however, that, if such extension would cause payment of
interest on or principal of a Loan to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day, and such
reduction of time shall be given effect in the computation of the payment of
interest hereunder.
Section 1.9. Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Loan owing to it in excess of its
proportionate share of payments on account of the Obligations, such Lender shall
forthwith purchase from the other Lenders such participation in the applicable
Obligations as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and such Lender shall
repay to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's proportionate share (according to
the proportion of (i) the amount of such Lender's required repayment to (ii) the
total amount so recovered from the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount
so recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 1.9 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Lender were the
direct creditor of the Borrower in the amount of such participation.
Section 1.10. Obligation of Lenders to Mitigate. If an event or the
existence of a condition occurs that would cause any Lender to become an
Affected Lender or that would entitle such Lender to receive payments under
Section 5.1, 5.2 or 5.3, then, upon the request of the Borrower, such Lender
will to the extent not inconsistent with any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, fund or maintain the
Commitment of such Lender or the Loan Amount of such Lender through another
lending office of such Lender or (ii) take such other reasonable measures, if as
a result thereof the circumstances which would cause such Lender to be an
Affected Lender would cease to exist or the additional amounts which would
otherwise be required to be paid to such Lender pursuant to Sections 5.1, 5.2
and 5.3 would be reduced and if the making, funding or maintaining of such
Commitment or Loan Amount through such other lending office or in accordance
with such other measures, as the case may be, would not otherwise materially
adversely affect such Commitment or Loan Amount or the interests of such Lender;
provided that such Lender will not be obligated to utilize such other lending
office pursuant to this Section 1.10 unless the Borrower agrees to pay all
incremental expenses, if any, incurred by such Lender as a result of utilizing
such other lending office as described in clause (i) above; provided, further,
that such Lender shall have no obligation to
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designate another lending office that does not maintain loans comparable to the
Loan. A certificate as to the amount of any such expenses (setting forth in
reasonable detail the basis for requesting such amount and the calculation
thereof) submitted by such Lender to the Borrower (with a copy to the Security
Trustee) shall be prima facie evidence of such expenses.
Section 1.11. Replacement Notes So long as General Electric Capital
Corporation and its Affiliates are the only Lenders, Replacement Notes may be
issued in accordance with the terms and conditions set forth in the Restructure
Letter.
ARTICLE II
INTEREST
Section 2.1. Rate of Interest. Subject to Section 1.7 hereof, each Note
shall bear interest on the unpaid principal amount thereof for each Interest
Period from the date made through maturity (whether by acceleration or
otherwise) at a rate equal to the sum of the LIBOR Rate for such Interest Period
plus the Applicable Margin. The applicable Interest Period for determining the
rate of interest with respect to each Note or portion thereof shall be
established in accordance with Section 2.2.
Section 2.2. Interest Periods.
(a) Interest Periods. The first Interest Period shall be the period
commencing on the Funding Date (provided, that in the case of a delayed Funding
Date, the date the funds for such Note are made available to the Administrative
Agent shall be the commencement date of such Interest Period pursuant to Section
1.2(b)), and shall end on, but shall exclude, the next Interest Payment Date,
and thereafter each successive Interest Period shall commence on (and shall
include) the last day of the next preceding Interest Period and shall end on
(but shall exclude) the next succeeding Interest Payment Date, provided however
that notwithstanding anything in this Agreement to the contrary, the final
Interest Period shall end on the Maturity Date.
(b) Expiration of Interest Periods. If an Interest Period would
otherwise expire on a day that is not a Business Day, such Interest Period shall
expire on the next succeeding Business Day; provided that, if any Interest
Period would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month, such
Interest Period shall expire on the next preceding Business Day.
Section 2.3. Interest Payments. Accrued interest on each Note shall be
payable in arrears on the last day of each Interest Period; provided, that (i)
interest accrued pursuant to Section 2.4 shall be payable on demand and (ii) in
the event of any repayment or prepayment of any Note (or any portion thereof),
accrued interest on the principal amount repaid or prepaid shall be payable on
the date of such repayment or prepayment.
Section 2.4. Default Rate. Notwithstanding Section 2.1, the Borrower shall
pay the Security Trustee for the account of the Lenders and the Transaction
Agents on demand interest on any principal, interest, fee or other amount not
paid hereunder, under any Note or under any other Transaction Document when due
at a rate per annum that is 2% per annum in excess of the LIBOR Rate for the
relevant Interest Period plus the Applicable Margin (the "Default Rate").
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Section 2.5. Computation of Interest. Interest on the Notes shall be
computed on the basis of a 360-day year for the actual number of days elapsed in
the period during which such amount accrues. In computing such amounts, the
first day of the applicable period shall be included, and the last day of the
applicable period shall be excluded; provided that if a Note (or any portion
thereof) is repaid on the same day on which it is made, one day's interest shall
be paid on that Note or the relevant portion thereof.
Section 2.6. Maximum Rate. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Note, together with
all fees, charges and other amounts which are treated as interest on such Note
under applicable law (collectively the "Charges"), shall exceed the maximum
lawful rate (the "Maximum Rate") which may be contracted for, charged, taken,
received or reserved by the Lender holding the Loan or the relevant portion
thereof in accordance with applicable law, the rate of interest payable in
respect of such Note or the relevant portion thereof hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate
and, to the extent lawful, the interest and Charges that would have been payable
in respect of such Note or the relevant portion thereof but were not payable as
a result of the operation of this Section shall be cumulated and the interest
and Charges payable to such Lender in respect of other periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated amount,
together with interest thereon at the LIBOR Rate to the date of repayment, shall
have been received by such Lender.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Representations and Warranties. The Borrower represents and
warrants to the Transaction Agents and each Lender as of the date of this
Agreement that:
(a) Organization; Powers. The Borrower is duly incorporated, validly
existing and in good standing under the laws of Delaware, has all requisite
corporate power and authority to carry on its business as now conducted and,
except where the failure to do so, individually or in the aggregate, would not
result in a Material Adverse Change, is qualified to do business in, and is in
good standing in, every jurisdiction where such qualification is required.
(b) Authorization; Enforceability. The execution and delivery of the
Transaction Documents by the Borrower and the performance by the Borrower of its
obligations thereunder are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action of Borrower and do not require
any stockholder approval, or approval or consent of any trustee or holder of
indebtedness or obligations of the Borrower except such as have been duly
obtained. This Agreement has been duly executed and delivered by the Borrower
and the other Transaction Documents will be duly executed and delivered by the
Borrower when required by this Agreement. This Agreement constitutes, and each
of the other Transaction Documents when executed and delivered by the Borrower
will constitute, a legal, valid and binding obligation of the Borrower,
enforceable against the Borrower in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
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(c) No Violation. The execution and delivery by the Borrower of the
Transaction Documents and the performance by the Borrower of its obligations
thereunder do not and will not (a) violate any provision of the Certificate of
Incorporation or By-Laws of the Borrower, (b) violate any law applicable to or
binding on the Borrower or (c) violate or constitute any default under (other
than any violation or default that would not result in a Material Adverse
Change), or result in the creation of any Lien (other than as permitted under
the Mortgage) upon any Engine under, any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, lease, loan or other material
agreement, instrument or document to which the Borrower is party or by which the
Borrower or any of its properties is bound.
(d) Governmental Approvals. The execution and delivery by the Borrower
of the Transaction Documents and the performance by the Borrower of its
obligations thereunder do not and will not require the consent or approval of,
or the giving of notice to, or the registration with, or the recording or filing
of any documents with, or the taking of any other action in respect of, any
Governmental Authority, other than (i) the consents of the ATSB and the four
counterguarantors under the ATSB loan documents to the Transaction Documents and
the Additional Documents, which have been obtained, (ii) the filings,
recordings, notices and other ministerial actions pursuant to any routine
recording, and contractual or regulatory requirements applicable to it, each of
which has been effected or obtained, and (iii) the filings described in Section
3.2(b).
(e) Litigation. Except as set forth in the Borrower's Annual Report on
Form 10-K for 2003 (as amended through the Funding Date), or in any Quarterly
Report on Form 10-Q or Current Report on Form 8-K filed by the Borrower with the
SEC subsequent to such Form 10-K (in each case as amended through the Funding
Date) (a list of which filings has been provided by Borrower to the
Administrative Agent on the Funding Date), no action, claim or proceeding is now
pending or, to the Actual Knowledge of the Borrower, threatened against the
Borrower before any court, governmental body, arbitration board, tribunal or
administrative agency, which is reasonably likely to be determined adversely to
the Borrower and if determined adversely to the Borrower would result in a
Material Adverse Change.
(f) Financial Condition. The audited consolidated balance sheet of the
Borrower with respect to its most recent fiscal year included in its Annual
Report on Form 10-K for 2003 (as amended through the Funding Date) filed by the
Borrower with the SEC, and the related consolidated statements of operations and
cash flows for the year then ended have been prepared in accordance with GAAP
and fairly present in all material respects the financial condition of the
Borrower and its consolidated subsidiaries as of such date and the results of
its operations and cash flows for such period, and since the date of such
balance sheet there has been no Material Adverse Change in such financial
condition or operations of the Borrower, except for matters disclosed in (a) the
financial statements referred to above or (b) any subsequent Quarterly Report on
Form 10-Q or Current Report on Form 8-K filed by the Borrower with the SEC (in
each case as amended through the Funding Date) (a list of which filings has been
provided by Borrower in writing to the Administrative Agent on the Funding
Date). The consolidated balance sheet of the Borrower as of June 30, 2004
included in its Quarterly Report on Form 10-Q for the period ended June 30,
2004, and the related consolidated statement of operations and cash flows for
the three months then ended have been prepared in accordance with GAAP (subject
to normal year-end adjustments and the absence of footnotes) and fairly present
in all material respects the
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financial condition of the Borrower and its consolidated subsidiaries as of such
date and the results of its operations and cash flows for such period.
(g) No Default. No Event of Default or Potential Default has occurred
and is continuing.
(h) Investment and Holding Company Status. The Borrower is not (i) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (ii) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.
(i) Use of Proceeds. No part of the proceeds of the Loan will be used,
whether directly or indirectly, for any purpose that entails a violation of
Regulations U or X of the Board of Governors of the Federal Reserve System.
(j) Licenses, Permits, etc. The Borrower is a Certificated Air Carrier
and holds all licenses, permits and franchises from the appropriate Governmental
Authorities necessary to authorize the Borrower to lawfully engage in air
transportation and to carry on scheduled commercial passenger service as
currently conducted, except where the failure to so hold any such license,
permit or franchise would not give rise to a Material Adverse Change.
(k) Compliance with Laws. Each of the Borrower and its Subsidiaries is
in compliance with all laws, regulations and orders of any governmental or
regulatory authority or agency applicable to it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Change.
(l) Tax Returns. The Borrower and its Subsidiaries have timely filed all
Federal income tax returns and all other material tax returns that are required
to be filed by them and have paid all Taxes that are material in amount shown to
be due pursuant to such returns or pursuant to any assessment received by the
Borrower or any of its Subsidiaries, other than any such assessment that is
being contested in good faith through appropriate proceedings and against which
adequate reserves are being maintained and the nonpayment of which (individually
or in the aggregate) could reasonably be expected to cause a material impairment
of the ability of the Borrower to perform, or the Transaction Agents or the
Lenders to enforce, the obligations of the Borrower under the Transaction
Documents. The charges, accruals and reserves on the books of the Borrower and
its Subsidiaries in respect of taxes and other governmental charges are, in the
opinion of the Borrower, adequate.
(m) Information. The Borrower's Annual Report on Form 10-K for 2003
filed with the SEC and each of the Borrower's Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K subsequently filed by the Borrower with the SEC, as
of the date it was filed with the SEC (or, if such report has been amended, in
each case as amended through the Funding Date) did not contain any untrue
statement of 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.
(n) ERISA. The Borrower and its subsidiaries have no employee benefit
plans covered by the minimum funding requirements of ERISA.
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Section 3.2. The Engines. The Borrower represents and warrants to the
Transaction Agents and each Lender, as of the date of this Agreement and as of
the Funding Date, that:
(a) Good Title. The Borrower has good title to each Engine free and
clear of Liens other than the Permitted Liens and the Liens to be released by
the Releases. Each Engine is maintained in accordance with the Borrower's
FAA-approved maintenance program relating to such Engine.
(b) Filings. Except for (i) the filing for recordation (and recordation)
with the FAA of the FAA Filed Documents with respect to the Engines, (ii) the
filing of the Financing Statements (and continuation statements relating thereto
at periodic intervals) with the Secretary of State of the State of Delaware (UCC
Division) with respect to the Relevant Engines, and (iii) the affixation of the
nameplates with respect to such Engines referred to in Section 3.02(d) of the
Mortgage, no further action, including any filing or recording of any document
(including any financing statement in respect thereof under Article 9 of the
UCC) is necessary in order to establish and perfect the Security Trustee's
interest under the Mortgage in the Engines as against the Borrower and any other
Person, in each case, in any applicable jurisdiction in the United States.
(c) No Event of Loss. No Event of Loss has occurred with respect to any
Engine, and no circumstance, condition, act or event has occurred that, with the
giving of notice or lapse of time or both gives rise to or constitutes an Event
of Loss with respect to any Engine.
(d) Section 1110. The Security Trustee is entitled to the benefits of
Section 1110 of the Bankruptcy Code with respect to the Specified Engines as
provided in the Mortgage in the event of a case under Chapter 11 of the
Bankruptcy Code in which Borrower is a debtor.
(e) Condition. Each Engine is in the condition and state of repair
required under the FAA-approved maintenance program of Borrower relating to such
Engine, and no appliances, parts, interests, appurtenances, accessories or other
equipment of whatever nature which are incorporated or installed in or attached
to any Engine are leased by the Borrower.
Section 3.3 Representations and Warranties of the Security Trustee. The
Security Trustee represents and warrants in its individual capacity that:
(a) Powers and Authorizations. It is a national banking association duly
organized and validly existing in good standing under the laws of the United
States and has full power and authority, in its individual capacity, to execute
and deliver this Agreement and (assuming the due authorization, execution and
delivery of this Agreement by the other parties hereto) perform its obligations
hereunder. The execution, delivery and performance by the Security Trustee of
the Transaction Documents to which it is or will be a party have been duly
authorized by all necessary action on its part and do not contravene the Charter
or By-laws of the Security Trustee; and the Transaction Documents to which the
Security Trustee is or will be a party have been duly authorized, executed and
delivered by the Security Trustee and constitute the legal, valid and binding
obligations, enforceable against it in accordance with its terms. This Agreement
and the other Transaction Documents to which the Security Trustee is or will be
a party, upon the due execution and delivery hereof, will constitute the legal,
valid and binding obligations of the
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Security Trustee in its individual capacity, and the performance by the Security
Trustee (in its individual or trust capacity, as the case may be) of any of its
obligations hereunder and thereunder does not contravene any federal law or
regulation or contractual restriction binding on or governing the banking or
trust powers of the Security Trustee (in its individual or trust capacity, as
the case may be);
(b) Litigation. There are no pending (or, to the Security Trustee's
knowledge, threatened) actions, suits, investigations or proceedings against or
affecting it before any court, arbitrator, or administrative or governmental
body which, individually or in the aggregate, if decided adversely to the
interests of the Security Trustee would materially and adversely affect the
ability of the Security Trustee, either in its individual capacity or as
Security Trustee, as the case may be, to perform its obligations under this
Agreement or any other Transaction Document or which questions or would affect
the legality or validity of this Agreement or such Transaction Document;
(c) No Legal Bar. Neither the execution and delivery by the Security
Trustee of this Agreement or any other Transaction Document nor the consummation
by the Security Trustee of any of the transactions contemplated hereby or
thereby requires or will require the consent or approval of or the giving of
notice to, the registration with, or the taking of any other action in respect
of, any federal governmental authority or agency governing its banking or trust
powers.
Section 3.4 Representations and Warranties of the Lenders. Each Lender
represents and warrants that:
(a) Accredited Investor. It is an accredited investor (as such term is
defined in Rule 501 under the Securities Act of 1933, as amended);
(b) Investment Intent. It is acquiring its interest in a Note, and any
interest in and to the Collateral, for its own account for investment and not
with a view to resale or distribution (subject, however, to the disposition of
its property being at all times within its control);
(c) ERISA. No part of the funds used by it to acquire its Notes
constitute the assets of any Plan. As used herein, "Plan" means an "employee
benefit plan (as such term is defined in Section 3(3) of ERISA or any "plan" (as
such term is defined in Section 4975(e)(1) of the Code which has been
established or maintained or contributed to by Borrower or an Affiliate that,
together with Borrower is treated as a single employer under Section 414(b), (c)
or (m) of the Code; and
(d) No Offering. Neither it nor anyone acting on its behalf has directly
or indirectly offered its Notes or any interest therein or any interest in and
to the Collateral, for sale to, or solicited any offer to acquire any of the
same from, the public or in any manner that would violate, or require the
registration of the issuance and sale of, such Notes or any interest therein, or
any transaction contemplated hereby, under the Securities Act of 1933, as
amended, the Trust Indenture Act of 1939, as amended, or applicable state
securities laws, or that might subject the Borrower to regulation under, require
Borrower to give notice to, or register with or take any other action in respect
of, any foreign governmental authority or agency.
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ARTICLE IV
COVENANTS
Section 4.1. Covenants of the Borrower. The Borrower shall comply with the
following covenants and agreements, unless the Required Lenders shall otherwise
consent:
(a) Financial Statements and Other Information. The Borrower will
furnish to the Transaction Agents and each Lender:
(i) within 120 days after the end of each fiscal year of the
Borrower, a copy of the Form 10-K (excluding exhibits) filed by the
Borrower with the SEC for such fiscal year (or in lieu of such copy
an e-mail notice that such report has been filed with the SEC and
providing a web site address at which such report may be accessed,
provided that such e-mail notice will satisfy this requirement only
if such report is in fact accessible at such web site address), or,
if no such Form 10-K was so filed, its audited consolidated balance
sheet and related statements of operations, stockholders' equity and
cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year,
all reported on by the Borrower's independent public accountants of
recognized national standing to the effect that such consolidated
financial statements present fairly in all material respects the
consolidated financial condition and results of operations of the
Borrower and its Subsidiaries on a consolidated basis in accordance
with GAAP;
(ii) within 60 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower, a copy of the
Form 10-Q (excluding exhibits) filed by the Borrower with the SEC
for such quarterly period (or in lieu of such copy an e-mail notice
that such report has been filed with the SEC and providing a web
site address at which such report may be accessed, provided that
such e-mail notice will satisfy this requirement only if such report
is in fact accessible at such web site address), or if no such Form
10-Q was so filed, its consolidated balance sheet and related
statements of operations and cash flows as of the end of and for
such fiscal quarter (in the case of the statement of operations) and
the then elapsed portion of the fiscal year, setting forth in each
case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of)
the previous fiscal year, prepared in accordance with GAAP, subject
to normal year-end audit adjustments and the absence of footnotes;
(iii) concurrently with any delivery of financial statements
under clause (i) above, an Officer's Certificate of the Borrower
certifying as to whether the Borrower has Actual Knowledge that a
Potential Default or an Event of Default has occurred and is
continuing and, if so, specifying the details thereof and any action
taken or proposed to be taken with respect thereto;
(iv) promptly following any request therefor, such other
nonconfidential information regarding the Engines, the operations,
business
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affairs and financial condition of the Borrower or any Subsidiary,
or compliance with the terms of the Transaction Documents, as any
Transaction Agent or Lender may reasonably request; and
(v) in the event that Borrower or any Affiliate that,
together with Borrower is treated as a single employer under Section
414(b), (c) or (m) of the Code, establishes any employee benefit
plan subject to Title IV of ERISA, upon the request of the Security
Trustee or any Lender, Borrower shall provide copies of the most
recent annual reports or returns (IRS Form 5500), audited or
unaudited financial statements and actuarial valuations with respect
to such plans.
(b) Existence; Conduct of Business. The Borrower will, and will
cause each of its Subsidiaries to:
(i) do or cause to be done all things necessary to preserve
and maintain its legal existence; provided that the foregoing shall
not prohibit any merger, consolidation, liquidation or dissolution
permitted under Section 4.1(c); provided further that this Section
4.1(b)(i) shall apply to the Subsidiaries of Borrower, if any, only
to the extent that the dissolution, termination or other loss of
legal existence of such Subsidiaries would reasonably be expected to
(either individually or in the aggregate) cause a material
impairment of the ability of the Borrower to perform, or the
Transaction Agents or the Lenders to enforce, the obligations of the
Borrower under the Transaction Documents.
(ii) comply with the requirements of all applicable laws,
rules, regulations and orders of governmental or regulatory
authorities if failure to comply with such requirements would
reasonably be expected to (either individually or in the aggregate)
cause a material impairment of the ability of the Borrower to
perform, or the Transaction Agents or the Lenders to enforce, the
obligations of the Borrower under the Transaction Documents;
(iii) pay and discharge all Taxes imposed on it or on its
income or profits or on any of its property prior to the date on
which penalties attach thereto, except for any such Tax the payment
of which is being contested in good faith and by proper proceedings
and against which adequate reserves are being maintained, and the
nonpayment of which (either individually or in the aggregate) could
reasonably be expected to cause a material impairment of the ability
of the Borrower to perform, or the Transaction Agents or the Lenders
to enforce, the obligations of the Borrower under the Transaction
Documents; and
(iv) permit representatives of any Lender, during normal
business hours and on reasonable notice, to discuss its business and
affairs with its officers, all to the extent reasonably requested by
such Lender; provided, however, that this Section 4.1(b)(iv) shall
apply to Subsidiaries of Borrower, if any, only to the extent that
an adverse circumstance with respect to the business and affairs of
such Subsidiaries would reasonably be expected to cause a material
impairment of
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the ability of the Borrower to perform, or the Transaction Agents or
the Lenders to enforce, the obligations of the Borrower under the
Transaction Documents.
(c) Mergers and Consolidations. The Borrower will not consolidate
with or merge into any other Person or convey, transfer or lease all or
substantially all of its assets as an entirety to any Person unless:
(i) the Person formed by such consolidation or into which
the Borrower is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of the Borrower as
an entirety shall be a Certificated Air Carrier;
(ii) the Person formed by such consolidation or into which
the Borrower is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of the Borrower as
an entirety shall execute and deliver to the Security Trustee a duly
authorized, valid, binding and enforceable agreement in form and
substance reasonably satisfactory to the Security Trustee containing
an assumption by such Person of the due and punctual performance and
observance of each covenant and condition of the Transaction
Documents to be performed or observed by the Borrower;
(iii) immediately after giving effect to such transaction, no
Event of Default shall have occurred and be continuing;
(iv) all filings shall have been made as shall be necessary
to preserve the perfection of (A) the Lien of the Mortgage on each
Engine on a first priority and perfected basis (subject to Permitted
Liens) and (B) the Lien of the Subordinated Mortgage on each Engine
on a second priority and perfected basis (subject to Permitted
Liens); and
(v) promptly after the consummation of such transaction, the
Borrower shall deliver to the Security Trustee a certificate of the
Secretary or an Assistant Secretary of Borrower certifying as to
Borrower's compliance with the conditions of this Section 4.1(c) and
an opinion of Borrower's Legal Department as to Borrower's
compliance with Sections 4.1(c)(i), 4.l(c)(ii) and 4.1(c)(iv).
Upon any consolidation or merger, or any conveyance, transfer or lease of
all or substantially all of the assets of the Borrower as an entirety in
accordance with this Section 4.1(c), the Person formed by such
consolidation or into which the Borrower is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Borrower under this
Agreement and the other Transaction Documents with the same effect as if
such Person had been named as the Borrower herein. No such conveyance,
transfer or lease of all or substantially all of the assets of the
Borrower as an entirety shall have the effect of releasing the Borrower or
any Person which shall theretofore have become such in the manner
prescribed in this Section 4.1(c) from the Borrower's liability in respect
of any Transaction Document to which it is a party.
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(d) Delivery of Post-Recording FAA Opinion. Promptly upon the
recording of the Mortgage, the Subordinated Mortgage, and each Mortgage
Supplement and each Subordinated Mortgage Supplement covering each Engine
pursuant to the Act, the Borrower will cause Daugherty, Fowler, Peregrin &
Xxxxxx, FAA counsel in Oklahoma City, Oklahoma, to deliver to the Security
Trustee and the Borrower a favorable opinion addressed to each of them as
to such recordation and the lack of filing of any intervening documents
creating a Lien with respect to such Engines.
(e) Engine Reports. The Borrower shall, by the tenth Business Day
of January, April, July and October of each year, commencing with such
date in October of 2004, furnish to the Security Trustee a report stating,
with respect to each Engine as of the last day of the calendar month
immediately preceding the date of such report prior to the date of such
report: (i) if such Engine is then installed on an airframe, the
Borrower's tail number of such airframe, or, if not so installed, the
status and location of such engine (ii) the hours and cycles of operation
of such Engine since new and since its last major overhaul and (iii) the
most limiting life limited part on such engine, (the "limiter"), and the
cycles remaining on such limiter.
(f) Compliance with Mortgage. The Borrower will comply with the
terms and provisions of the Mortgage.
ARTICLE V
INCREASED COSTS; GENERAL INDEMNITY
Section 5.1. Increased Costs. The Borrower shall pay directly to each
Lender from time to time, within ten (10) Business Days after demand therefor,
such additional amount or amounts as may be necessary to compensate such Lender
on a net after-tax basis for any increased costs incurred by such Lender which
are attributable to its making or maintaining its Percentage Share or its
Ratable Share of the Loan hereunder or its obligation to make its Percentage
Share of the Loan hereunder, or any reduction in any amount receivable by such
Lender under this Agreement in respect of the Loan or such obligation (such
increases in costs and reductions in amounts receivable being herein called
"Additional Costs"), resulting from any change after the date of this Agreement
in U.S. federal, state, municipal, or foreign or supranational laws or
regulations (including Regulation D of the Board of Governors of the Federal
Reserve System), or the adoption or making after the date of this Agreement of
any interpretations, directives, or requirements applying to a class of banks
including such Lender under any U.S. federal, state, municipal, or any foreign
laws or regulations (whether or not having the force of law) by any court,
central bank or monetary authority charged with the interpretation or
administration thereof (a "Regulatory Change"), which imposes or modifies any
reserve, special deposit, compulsory loan or similar requirements relating to
any extensions of credit or other assets of, or any deposits with other
liabilities of, such Lender (including its Percentage Share or its Ratable Share
of the Loan or any deposits referred to in the definition of LIBOR Rate or
related definitions) which is not otherwise included in the determination of the
applicable interest rate hereunder.
Each Lender will notify the Borrower of any event occurring after the date
of this Agreement that will entitle such Lender to compensation pursuant to this
Section 5.1 as promptly
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as practicable, but in any event within 60 days, after such Lender obtains
Actual Knowledge thereof; provided, however, that if any Lender fails to give
such notice within 60 days after it obtains Actual Knowledge of such an event,
such Lender shall, with respect to compensation payable pursuant to this Section
5.1 in respect of any costs resulting from such event, be entitled to payment
under this Section 5.1 only for costs incurred from and after the date 60 days
prior to the date that such Lender does give such notice; provided, further that
no compensation shall be payable by the Borrower to any Lender pursuant to this
Section 5.1 unless such Lender certifies to the Borrower that (x) such Lender is
assessing to its other borrowers (of loans similar to the Loans) comparable
allocable costs, and (y) such Lender believes that such costs are generally
applicable to lenders similarly situated to and in the same jurisdiction as such
Lender. Such notice shall describe in reasonable detail the calculation of the
amounts owed under this Section. Determinations by a Lender for purposes of this
Section 5.1 of the effect of any Regulatory Change on its costs of making or
maintaining its Percentage Share or its Ratable Share of the Loan or on amounts
receivable by it in respect of the Loan, and of the additional amounts required
to compensate such Lender in respect of any Additional Costs, shall be prima
facie evidence of the amount owed under this Section 5.1.
Any assignee of a Lender that is not the initial Lender party to the Loan
Agreement shall not be entitled to any greater compensation under this Section
5.1 than that which would have been payable to the transferor Lender as of the
date of the transfer or sale of the Note to such transferee Lender; provided,
however, that, if subsequent to the date of transfer or sale of the Note there
occurs a Regulatory Change and such transferee Lender is domiciled in a
Designated Country, such transferee Lender shall be entitled to compensation
under this Section 5.1 as a result of such Regulatory Change.
Section 5.2. Capital Adequacy. If (1) the adoption, after the date hereof,
of any applicable governmental law, rule or regulation regarding capital
adequacy, (2) any change, after the date hereof, in the interpretation or
administration of any such law, rule or regulation by any central bank or other
Governmental Authority charged with the interpretation or administration thereof
or (3) compliance by a Lender or any corporation or bank controlling a Lender
with any applicable guideline or request of general applicability, issued after
the date hereof, by any central bank or other Governmental Authority (whether or
not having the force of law) that constitutes a change of the nature described
in clause (2) ("Capital Adequacy Change"), has the effect of (x) requiring an
increase in the amount of capital required to be maintained by a Lender or any
corporation or bank controlling a Lender or (y) reducing the rate of return on
assets or capital of such Lender (or such corporation or bank) and such
adoption, change or compliance, as the case may be, relates to a category of
claims or assets that includes such Lender's Loan Amount, the Borrower shall pay
to such Lender from time to time such additional amount or amounts as are
necessary to compensate such Lender for such portion of such increase or
reduction as shall be reasonably allocable to such Lender's Loan Amount;
provided, that no such amounts shall be payable by the Borrower to any Lender
pursuant to this Section 5.2 unless such Lender certifies to the Borrower that
(A) such Lender is assessing to its other borrowers (of loans similar to the
Loans) comparable allocable costs, and (B) such Lender believes that such costs
are generally applicable to lenders similarly situated to and in the same
jurisdiction as such Lender. For the avoidance of doubt, the matters set forth
in the Consultative Document titled "The New Basel Capital Accord" issued by the
Basel Committee on Banking Supervision in April 2003 will not be treated, for
purposes of determining whether any Lender is entitled to
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compensation under this Section 5.2, as having been enacted or having come into
effect before the date of this Agreement.
Each Lender will notify the Borrower of any event occurring after the date
of this Agreement that will entitle such Lender to compensation pursuant to this
Section 5.2 as promptly as practicable but in any event within 60 days, after
such Lender obtains Actual Knowledge thereof; provided, however, that if any
Lender fails to give such notice within 60 days after it obtains Actual
Knowledge of such an event, such Lender shall, with respect to compensation
payable pursuant to this Section 5.2 in respect of any costs resulting from such
event, be entitled to payment under this Section 5.2 only for costs incurred
from and after the date 60 days prior to the date that such Lender does give
such notice. Such notice shall describe in reasonable detail the calculation of
the amounts owed under this Section. Determinations by a Lender for purposes of
this Section 5.2 of the effect of any increase in the amount of capital required
to be maintained by the bank and of the amount allocable to such Lender's
obligations to the Borrower hereunder shall be prima facie evidence of the
amounts owed under this Section.
Any assignee of a Lender that is not the initial Lender party to the Loan
Agreement shall not be entitled to any greater compensation under this Section
5.2 than that which would have been payable to the transferor Lender as of the
date of the transfer or sale of the Note to such transferee Lender; provided,
however, that, if subsequent to the date of transfer or sale of the Note there
occurs a Capital Adequacy Change and such transferee Lender is domiciled in a
Designated Country, such transferee Lender shall be entitled to compensation
under this Section 5.2 as a result of such Capital Adequacy Change.
Section 5.3. Withholding of Taxes.
(a) Payments to Be Free and Clear. All sums payable by the
Borrower under this Agreement and the other Transaction Documents to each
Lender and each Transaction Agent shall (except to the extent required by
law) be paid free and clear of, and without any deduction or withholding
on account of, any Tax imposed, levied, collected, withheld or assessed by
or within any jurisdiction or by or within any political subdivision or
taxing authority thereof or therein with respect to such payments.
(b) Grossing-up of Payments. If the Borrower or any other Person
is required by law to make any deduction or withholding on account of any
Tax from any sum paid or payable by the Borrower to any Transaction Agent
or any Lender under any of the Transaction Documents:
(i) the Borrower shall notify the Security Trustee in
writing of such requirement;
(ii) the Borrower shall pay such Tax before the date on which
any interest, addition to Tax or penalties attach thereto, such
payment to be made (if the liability to pay is imposed on the
Borrower) for its own account or (if that liability is imposed on
any Transaction Agent or such Lender, as the case may be) on behalf
of and in the name of such Transaction Agent or such Lender;
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(iii) in the case of any Tax other than an Excluded Tax, the
sum payable by the Borrower in respect of which the relevant
deduction, withholding or payment is required shall be increased to
the extent necessary to ensure that, after the making of that
deduction, withholding or payment, such Transaction Agent or such
Lender, as the case may be, receives on the due date a net sum equal
to what it would have received had no such deduction, withholding or
payment been required or made; and
(iv) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required
by clause (b) above to pay, the Borrower shall deliver to the
Security Trustee evidence reasonably satisfactory to the affected
parties of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority.
If any additional amounts are payable in respect of Taxes pursuant to
clause (iii) above, the Borrower agrees to indemnify each Lender, each
Transaction Agent and their successors, assigns and Affiliates for such
Taxes required to be deducted or withheld and to reimburse such Persons,
upon the written request of such Person, for the net increase in Tax
imposed on or measured by the net income or net profits of such Lender
(after taking into account current credits and deductions resulting from
such Tax liability) pursuant to the laws of the jurisdiction in which such
Lender is organized or in which the principal office or applicable Lending
Office of such Lender is located or under the laws of any political
subdivision or taxing authority of any such jurisdiction in which such
Lender is organized or in which the principal office or applicable Lending
Office of such Lender is located or in which such Lender is doing business
(if the Taxes imposed on the net income, net profits or net gains of such
Lender by such jurisdiction in which a Lender is doing business are
treated as Excluded Taxes under this Agreement) and for any withholding of
Taxes as such Lender shall reasonably determine (subject to verification
pursuant to Section 5.3(c)(iv)) are payable by, or withheld from, such
Lender in respect of such amounts so paid to or on behalf of such Lender
pursuant to clause (iii) above and in respect of any amounts paid to or on
behalf of such Lender pursuant to this sentence. Notwithstanding the
foregoing provisions of this Section 5.3(b), no such additional amount
shall be required to be paid to either Transaction Agent or any Lender
under clause (iii) above in respect of United States federal withholding
taxes except to the extent that such obligation to deduct or withhold
results from a written change, after the date hereof in applicable law,
treaty, or governmental rule, regulation or order, or any change in the
official interpretation, administration or application thereof (other than
the addition of or a change in an "anti-treaty-shopping" or "limitation of
benefits" or similar provision of any income tax treaty affecting
eligibility for benefits under such treaty).
(c) Evidence of Exemption from U.S. Withholding Tax.
(i) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof shall, to the extent it is entitled to
do so, deliver to the Security Trustee for transmission to the
Borrower, at or prior to the Closing (in the case of each
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Lender listed on the signature pages hereof) or on or prior to the
date of the Transfer Supplement pursuant to which it becomes a
Lender (in the case of each other Lender), (x) two original copies
of Internal Revenue Service Form W-8BEN or W-8ECI (or any successor
forms), properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption
required under the Internal Revenue Code or the regulations issued
thereunder to establish that such Lender is entitled to an exemption
or reduction in the amount of United States federal income tax
required to be deducted or withheld from any payments to such Lender
of interest, fees or other amounts payable under any of the
Transaction Documents or (y) if such Lender is not a "bank" or other
Person described in Section 881(c)(3) of the Internal Revenue Code
and cannot deliver either Internal Revenue Service Form W-8BEN
claiming exemption under a treaty or W-8ECI, pursuant to clause (x)
above, a Certificate re Non-Bank Status together with two original
copies of Internal Revenue Service Form W-8BEN (or any successor
form), properly completed and duly executed by such Lender, together
with any other certificate or statement of exemption required under
the Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is entitled to an exemption or reduction
in the amount of United States federal income tax required to be
withheld from payments to such Lender of interest payable under any
of the Transaction Documents.
Each Lender that is organized under the laws of the United
States or any state or other political subdivision thereof shall
deliver to the Security Trustee for transmission to the Borrower, at
or prior to the Closing (in the case of each Lender listed on the
signature pages hereof) or on or prior to the date of the Transfer
Supplement pursuant to which it becomes a Lender (in the case of
each other Lender), two original copies of Internal Revenue Service
Form W-9 (or any successor form), properly completed and duly
executed by such Lender, if requested by the Borrower in writing and
required by the Internal Revenue Code or the regulations issued
thereunder to permit the Borrower to pay to or for the account of
such Lender interest, fees or other amounts pursuant to any of the
Transaction Documents without deducting or withholding any United
States federal income tax from such payment.
(ii) Each Lender required to deliver any forms, certificates
or other evidence with respect to United States federal income tax
withholding matters pursuant to Section 5.3(c)(i) hereby agrees,
from time to time after the initial delivery by such Lender of such
forms, certificates or other evidence, whenever a lapse in time or
change in circumstances (other than, unless notified by the
Borrower, a change in applicable United States law, including United
States income tax conventions and treaties) renders such forms,
certificates or other evidence obsolete or inaccurate in any
material respect, that such Lender, to the extent it is entitled to
do so, shall promptly (x) deliver to the Security Trustee for
transmission to the Borrower two new original copies of Internal
Revenue Service Form W-8BEN or W-8ECI or W-9, or a Certificate re
Non-Bank Status and two original copies of Internal Revenue Service
Form W-8BEN, as the case may be, properly completed and duly
executed by such Lender, together with any other
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certificate or statement of exemption required in order to confirm
or establish that such Lender is entitled to an exemption or
reduction in the amount of United States federal income tax required
to be withheld from payments to such Lender under the Transaction
Documents or (y) notify the Security Trustee and the Borrower of its
inability to deliver any such forms, certificates or other evidence
in which case such Lender shall not be required to deliver any such
form or certificate pursuant to this Section 5.3(c).
(iii) The Borrower shall not be required to pay any additional
amount to any Lender under clause (iii) of Section 5.3(b) if such
Lender shall have failed to satisfy the requirements of clause (i)
or (ii)(x) of this Section 5.3(c); provided that if such Lender
shall have satisfied the requirements of Section 5.3(c)(i) at or
prior to the Closing (in the case of each Lender listed on the
signature pages hereof) or on the date of the Transfer Supplement
pursuant to which it became a Lender (in the case of each other
Lender), nothing in this Section 5.3(c)(iii) shall relieve the
Borrower of its obligation to pay any additional amounts pursuant to
Section 5.3(b) in the event that, as a result of any change in any
applicable law, treaty or governmental rule, regulation or order, or
any change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to withholding
as described in Section 5.3(c)(i) or (ii).
(iv) If the Borrower pays any additional amount under this
Section 5.3 to a Lender and such Lender determines in its sole
discretion that it has actually realized in connection therewith a
net cash benefit (including a net cash benefit which the relevant
taxing authority applies to satisfy any liability of such Lender for
Excluded Taxes) due to any refund or any reduction of, or credit
against, its liabilities for Excluded Taxes in any taxable year,
provided no Special Default or Event of Default shall have occurred
and be continuing, such Lender shall, to the extent it can do so
without prejudice to the retention of such benefit, pay to the
Borrower an amount that the Lender shall, in its sole discretion,
determine (subject to confirmation as provided below) is equal to
such net cash benefit which was obtained by the Lender in such year
as a consequence of such refund, reduction or credit realized in
connection with the payment of such additional amount. A Lender
shall, upon written request from the Borrower, provide to the
Borrower a letter from independent accountants selected by the
Lender and reasonably acceptable to the Borrower confirming the
accuracy of the Lender's calculations of any amount due pursuant to
the next-to-last sentence of Section 5.3(b), or the amount of any
net benefit determined by Lender pursuant to the preceding sentence,
provided that the interpretation of this Agreement or any other
Transaction Document shall not be within the scope of the
accountants' confirmation. Nothing contained in this Section
5.3(c)(iv) shall be construed as requiring any Lender to conduct its
business or arrange or alter in any respect its tax or financial
affairs so that it is entitled to receive a refund, reduction or
credit or shall require any Lender to provide to the Borrower or its
agents copies of any tax returns or other information with respect
to the income, assets or operations
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attesting to such Lender's determination. The Borrower shall
reimburse each Lender for all costs and expenses incurred by Lender
in obtaining such accountants' letter, provided that the
accountants' letter confirms, in all material respects, Lender's
determination.
(v) The Borrower shall have no obligation to pay to any
Lender any additional amount under Section 5.3(b)(iii) or to
indemnify any Lender under Section 5.4 for any United States federal
income tax or withholding tax which was required by law to be
deducted or withheld by the Borrower or any Transaction Agent from
any prior payment to or for the benefit of such Lender pursuant to
the Transaction Documents but which was not deducted or withheld due
to the Borrower's or the Transaction Agent's reasonable reliance on
an Internal Revenue Service Form W-8BEN or W-8ECI or W-9 (or
applicable successor form) theretofore delivered by such Lender
pursuant to Section 5.3(c)(i) or (ii) if such form was inaccurate in
any material respect when delivered by such Lender and such Lender
had actual knowledge of such inaccuracy at the time such Lender
delivered such form.
Section 5.4. (a) Other Taxes. In addition to the amounts described
elsewhere in this Article V, the Borrower shall pay, and indemnify, and hold
harmless on a net after-tax basis each Lender and the Security Trustee from and
against all Other Taxes (other than (i) Taxes imposed by deduction or
withholding from amounts payable by the Borrower to any Transaction Agent or
Lender, (ii) Excluded Taxes and (iii) Taxes imposed on or with respect to a
transfer (including a participation) of any interest in a Loan unless such
transfer is in connection with an Event of Default or at the Borrower's request)
which arise from any payment made hereunder or under any other Transaction
Document or from the execution, delivery, registration, filing, recording,
performance or enforcement of, or otherwise with respect to, this Agreement or
any other Transaction Document or otherwise in connection with or as a result of
the transactions contemplated by the Transaction Documents.
(b) Contest of Tax Claims. If a Lender or either Transaction Agent (each
a "Tax Indemnitee") receives a written claim from any taxing authority for any
Tax for which the Borrower is liable pursuant to Section 5.3 or 5.4 (a "Tax
Claim"), such Tax Indemnitee shall promptly notify the Borrower in writing. If
requested by the Borrower in writing within 30 days after receipt of such Tax
Indemnitee's written notice (provided that if a response to such Tax Claim is
due less than 40 days after the Borrower's receipt of such Tax Indemnitee's
notice, the Borrower's request must be made within 15 days or, if longer, the
period ending not later than the 10th day before the day on which the response
to such Tax Claim is due), such Tax Indemnitee shall in good faith contest or,
at such Tax Indemnitee's election, permit the Borrower to contest (unless such
contest involves Excluded Taxes or, in such Tax Indemnitee's reasonable, good
faith judgment, permitting the Borrower to contest may have a material adverse
effect on such Tax Indemnitee), in each case in accordance with and to the
extent permitted by applicable law and at the Borrower's expense, such Tax
Claim, provided that no Tax Indemnitee shall have any obligation to commence or
continue the contest of any such Tax Claim unless the following conditions are
satisfied at the time the contest is to be commenced and at all times during the
contest:
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(i) no Event of Default (or event described in Section 7.1(a),
(b), (f) which would become an Event of Default after passage of time)
shall have occurred and be continuing,
(ii) contesting such Tax Claim would not result in (A) any risk of
sale, forfeiture, confiscation, seizure or loss of, or the imposition of a
Lien (other than a Lien for the Tax that is the subject of such contest
provided that enforcement of such Lien is stayed until the final
determination of such contest and the Borrower maintains adequate reserves
with respect to such Lien) or (B) any risk of imposition of criminal
liability,
(iii) the aggregate amount of the Taxes that are to be contested
exceeds Twenty-Five Thousand Dollars ($25,000),
(iv) such Tax Indemnitee shall have received a written confirmation
of the Borrower that the Taxes that are the subject of such Tax Claim are
Tax for which the Borrower is liable pursuant to Section 5.3 or 5.4,
provided that the Borrower shall not be bound by such confirmation to the
extent that the final determination of the contest articulates conclusions
of law and fact that demonstrate that the Taxes that are the subject of
such Tax Claim are Excluded Taxes,
(v) the Borrower, upon the written request of such Tax Indemnitee,
shall have provided such Tax Indemnitee, at the expense of the Borrower,
with an opinion of counsel selected by such Tax Indemnitee and reasonably
acceptable to the Borrower to the effect that there is a substantial basis
in law and fact to contest such Tax Claim and a realistic expectation that
a contest of such Tax Claim would be successful,
(vi) if such Tax Indemnitee decides to contest such Tax Claim by
paying the Taxes that are the subject of such Tax Claim and taking action
to obtain a refund thereof, the Borrower shall have made an interest-free
advance to such Tax Indemnitee in an amount equal to the amount of those
Taxes and shall have delivered to such Tax Indemnitee a written
undertaking to indemnify such Tax Indemnitee and its Affiliates on an
after-tax basis for any adverse Tax consequences (taking into account all
relevant Tax benefits and Tax detriments) to such Tax Indemnitee or any of
its Affiliates resulting from such interest-free advance, and
(vii) the Borrower shall be paying, on demand and on an after-tax
basis, all reasonable costs and expenses incurred by such Tax Indemnitee,
any Transaction Agent or any Lender in connection with the conduct of such
contest (including, without limitation, reasonable attorneys' and
accountants' fees and disbursements).
(c) Non-Parties. If a Tax Indemnitee is not a party to this Agreement,
the Borrower may require such Tax Indemnitee to agree in writing to the terms of
Sections 5.3 and 5.4 prior to making any payment to such Tax Indemnitee under
Section 5.3 or 5.4.
Section 5.5. Indemnity. (a) Indemnity Obligation. The Borrower agrees to
indemnify and hold harmless each Lender, the Security Trustee, the
Administrative Agent, General Electric Capital Corporation under the Restructure
Letter and their respective
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successors, assigns, directors, officers, employees and agents (hereinafter in
this Section 5.5 referred to individually as an "Indemnitee," and collectively
as "Indemnitees") on an after-tax basis against any and all liabilities,
obligations, losses, damages, penalties, claims, demands, actions, suits,
judgments and any and all costs and expenses (including reasonable attorneys'
fees, disbursements and other charges) (for the purposes of this Section 5.5 the
foregoing are collectively called "Losses") of whatsoever kind and nature
imposed on, asserted against or incurred or suffered by any of the Indemnitees
in any way relating to, or arising out of, or by reason of any investigation,
litigation, or other proceedings (including any threatened investigation,
litigation or other proceedings) relating to the Mortgage or the exercise or
enforcement by the Security Trustee of any of the terms, rights, or remedies
thereunder, or in any way relating to or arising out of the manufacture,
ownership, ordering, purchase, delivery, control, acceptance, lease, possession,
operation, condition, sale, return or other disposition, or use of the
Collateral (including latent or other defects, whether or not discoverable), the
violation of the Laws of any country, state or other governmental authority with
respect to or arising otherwise in connection with the Collateral, or any tort
(including claims arising or imposed under the doctrine of strict liability, or
for or on account of injury to or the death of any Person (including any
Indemnitee), or property damage) with respect to or arising otherwise in
connection with the Collateral (but excluding any such Losses to the extent
incurred by reason of (i) the gross negligence or willful misconduct of such
Indemnitee or any related Indemnitee (as defined below), (ii) Taxes, reserve
requirements or similar regulatory requirements imposed by banking authorities
except as otherwise provided in Sections 5.1, 5.2, 5.3 and 5.4 hereof, (iii)
breaches by such Indemnitee of any Transaction Document to which it is a party
or (iv) to the extent attributable to the failure of any Transaction Agent to
distribute funds received and distributable by it in accordance any such
Transaction Documents). For purposes of subclause (i) above, an Indemnitee shall
be considered a "related" Indemnitee with respect to another Indemnitee if such
Indemnitee is an Affiliate or employer of such other Indemnitee or a director,
officer, employee or agent of such other Indemnitee, or a successor or assignee
of such other Indemnitee.
(b) Indemnification Procedures.
(i) Notice. In case any action, suit or proceeding shall be
brought against any Indemnitee for which such Indemnitee will seek
indemnification under Section 5.5(a), such Indemnitee shall notify the Borrower
of the commencement thereof and the Borrower may, subject to the provisions of
this Section 5.5, at its expense, participate in and to the extent that it shall
wish (subject to the provisions of the following subsections), assume and
control the defense thereof and, subject to Section 5.5(b)(iii), settle or
compromise the same. Notwithstanding the foregoing, the failure of any
Indemnitee to notify the Borrower as provided in this Section 5.5(b)(i) shall
not release the Borrower from any of its obligations to indemnify such
Indemnitee hereunder, except to the extent that such failure results in an
additional Loss to the Borrower (in which event the Borrower shall not be
responsible for such additional Loss) or materially impairs the Borrower's
ability to contest such claim.
(ii) Control. The Borrower or its insurer(s) shall have the right,
at its or their expense, to investigate and, if the Borrower or its insurer(s)
shall agree not to dispute liability to the Indemnitee giving notice of such
action, suit or proceeding under Section 5.5(a) or under any insurance policies
pursuant to which coverage is sought, control the defense of any action, suit or
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proceeding relating to any Losses for which indemnification is sought pursuant
to this Section 5.5, and each Indemnitee shall cooperate with the Borrower or
its insurer(s) with respect thereto; provided, that the Borrower shall not be
entitled to control the defense of any such action, suit, proceeding or
compromise any such Losses during the continuance of any Event of Default and so
long as no such cooperation shall entail a material risk of (A) criminal
liability of such Indemnitee, (B) unindemnified civil liability of such
Indemnitee or (C) the sale, loss, forfeiture or seizure of the Collateral. In
connection with any such action, suit or proceeding being controlled by the
Borrower, such Indemnitee shall have the right to participate therein, at its
sole cost and expense.
(iii) Settlement. In no event shall any Indemnitee enter into a
settlement or other compromise with respect to any Losses without the prior
written consent of the Borrower, unless such Indemnitee waives its right to be
indemnified with respect to such Losses under this Section 5.5.
(iv) Cooperation. Each Indemnitee agrees to cooperate with the
Borrower and its insurers in the exercise of their rights to investigate, defend
or compromise Losses for which indemnification may be claimed hereunder.
(v) Nonparties. If an Indemnitee is not a party to this Agreement,
the Borrower may require such Indemnitee to agree in writing to the terms of
this Section 5.5 prior to making any payment to such Indemnitee under this
Section 5.5.
(vi) No Requirement. Nothing contained in this Section 5.5(b) shall
be deemed to require an Indemnitee to assume responsibility for or control of
any judicial proceeding with respect to any Losses.
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1. General Conditions. The obligation of the Original Lenders to
make the Loan is subject to the conditions that on or prior to the Funding Date:
(a) The Borrower shall have delivered to the Administrative Agent (with
a copy for each Original Lender) the following:
(i) an executed counterpart of this Agreement;
(ii) an executed counterpart of the Payment and Indemnity
Agreement;
(iii) an executed counterpart of the Mortgage;
(iv) an executed counterpart of the Subordinated Mortgage;
(v) an executed counterpart of the Security Trustee Agreement;
(vi) an opinion of Vedder, Price, Xxxxxxx & Kammholz, P.C., special
New York counsel to the Borrower, substantially in the form of Exhibit D
to this Agreement;
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(vii) an opinion of the Borrower's Legal Department, substantially
in the form of Exhibit E to this Agreement;
(viii) an opinion of Ray, Xxxxxxx & Xxxxxxx, special counsel to the
Security Trustee, in a form satisfactory to the Administrative Agent;
(ix) an opinion of Daugherty, Fowler, Peregrin & Xxxxxx, FAA
counsel, substantially in the form of Exhibit H to this Agreement;
(x) (1) a certificate of the Secretary or an Assistant Secretary
of the Borrower certifying (i) the resolutions of the Borrower's board of
directors or executive committee of such board approving the transactions
contemplated by this Agreement, (ii) the name and signature of each
officer who executes a Transaction Document or Additional Document on the
Borrower's behalf (on which certificate the Transaction Agents and each
Lender may conclusively rely until a revised certificate is received),
(iii) the Borrower's certificate of incorporation and (iv) a copy of the
Borrower's By-Laws and (2) a good standing certificate of the Borrower
from the Secretary of State of the State of Delaware; and
(xi) an executed counterpart of the Restructure Letter.
(b) The Borrower shall have paid the upfront fee specified in Section
1.3.
Section 6.2. Additional Conditions. The obligation of the Lenders to make
the Loan is subject to the fulfillment, prior to or on the Funding Date, of the
following additional conditions precedent:
(a) The Security Trustee shall have received the following
documents (with a copy for each Lender):
(i) (1) a Series A Note (duly executed by the Borrower and
authenticated by the Security Trustee) in an original principal
amount equal to the Original Series A Lender's Commitment and (2)
provided that the Original Series B Lender's Commitment is greater
than zero, a Series B Note (duly executed by Borrower and
authenticated by the Security Trustee) in an original principal
amount equal to the Original Series B Lender's Commitment shall each
have been issued to the applicable Original Lender;
(ii) the Mortgage Supplement and Subordinated Mortgage
Supplement;
(iii) the broker's report and insurance certificate required
by Appendix B of the Mortgage and the Subordinated Mortgage with
respect to the Engines;
(iv) with respect to each Engine, a copy of the original xxxx
of sale or other evidence of ownership reasonably satisfactory to
the Security Trustee (which may be a copy of an invoice or a
purchase order);
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(v) an Officer's Certificate of the Borrower, dated as of
the Funding Date, stating that its representations and warranties
set forth in Sections 3.1 and 3.2 of this Agreement are true and
correct as of the Funding Date (or, to the extent that any such
representation and warranty expressly relates to an earlier date,
true and correct as of such earlier date);
(vii) the Financing Statements; and
(viii) the UCC Termination Statements.
(b) On the Funding Date, after giving effect to the filing of the
FAA Filed Documents and the Financing Statements with respect to the
Engines, (i) the Security Trustee under the Mortgage shall have received a
duly perfected first priority security interest in all of the Borrower's
right, title and interest in the Engines, subject only to Permitted Liens
that are not Liens of record and (ii) the "Security Trustee" under the
Subordinated Mortgage shall have received a duly perfected second priority
security interest in all of the Borrower's right, title and interest in
the Engines, subject only to the Lien of the Mortgage and other Permitted
Liens (as defined in the Subordinated Mortgage) that are not Liens of
Record.
(c) No change shall have occurred after the date of this Agreement
in any applicable law that makes it a violation of law for (a) the
Borrower, the Transaction Agents or any Lender to execute, deliver and
perform the Transaction Documents or Additional Documents to which any of
them is a party or (b) any Lender to make the Loans with respect to the
Engines.
(d) On the Funding Date, no event shall have occurred and be
continuing, or would result from the mortgage of the Engines, which
constitutes an Event of Default or a Potential Default.
(e) No Event of Loss (as defined in the Mortgage) with respect to
the Engines shall have occurred and no circumstance, condition, act or
event that, with the giving of notice or lapse of time or both, would give
rise to or constitute an Event of Loss with respect to the Engines shall
have occurred.
(f) The Borrower shall have good title to the Engines, free and
clear of all Liens, except, after giving effect to the Releases, Permitted
Liens which are not Liens of Record.
(g) The Security Trustee shall be entitled to the benefits of
Section 1110 of the Bankruptcy Code with respect to the Specified Engines
as provided in the Mortgage in the event of a case under Chapter 11 of the
Bankruptcy Code in which the Borrower is a debtor.
(h) On the Funding Date (i) the FAA Filed Documents with respect
to the Collateral shall have been duly filed for recordation (or shall be
in the process of being so duly filed for recordation) with the FAA in
accordance with the Act and (ii) each Financing Statement and each of the
UCC Termination Statements with respect to the
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Collateral shall have been duly filed (or shall be in the process of being
so duly filed) in the appropriate jurisdiction.
(i) No action or proceeding shall have been instituted, nor shall
any action be threatened in writing, before any Governmental Authority,
nor shall any order, judgment or decree have been issued or proposed to be
issued by any Governmental Authority, to set aside, restrain, enjoin or
prevent the completion and consummation of this Agreement or any other
Transaction Document, Additional Document or the transactions contemplated
hereby or thereby.
(j) The representations and warranties in Sections 3.1 and 3.2
shall be true and correct in all material respects on and as of such date
(except to the extent such representations and warranties relate solely to
an earlier date but then as of such earlier date).
(k) The Borrower shall have paid (or shall have given instructions
for the initiation of wire transfers to pay) all amounts referred to in
the first sentence of Section 9.3 for which it shall have received
reasonably detailed invoices at least two Business Days before the Funding
Date.
(l) No payment default (without giving effect to any grace period)
by Borrower shall have occurred and be continuing under any of the AWA
Operative Documents (as defined in the Payment and Indemnity Agreement) or
any agreement to which the Borrower and any Lender or any Lender's
Subsidiaries are parties (or any agreement to which the Borrower is a
party relating to the same transaction as any such agreement).
(m) No payment default by the Borrower currently exists with
respect to any financing facility of $5,000,000 or more and the Security
Trustee and the Lenders shall have received a certification from the
Borrower to such effect.
(n) All conditions to the funding of the loan contemplated by
the Related Loan Agreement have been satisfied, and such loan is being
funded contemporaneously with the Loan.
(o) The ATSB letter of approval, in form reasonably acceptable to
each Lender and the Borrower, shall have been provided by the Borrower.
(p) (1) A certificate of the Secretary or an Assistant Secretary
of the Security Trustee certifying (i) the name and signature of each
officer who executes a Transaction Document or Additional Document on the
Security Trustee's behalf, (ii) the Security Trustee's certificate of
incorporation and (iii) the Security Trustee's bylaws; and (2) a good
standing certificate of the Security Trustee from the Comptroller of the
Currency.
(q) Such other documents relating to the Loan contemplated hereby
as the Security Trustee or any Lender may reasonably request.
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ARTICLE VII
EVENTS OF DEFAULT
Section 7.1. Events of Default. Each of the following events shall
constitute an "Event of Default," whether any such event shall be voluntary or
involuntary or come about or be effected by operation of law or pursuant to or
in compliance with any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body:
(a) The Borrower shall fail to make any payment of principal of or
interest on the Loan or LIBOR Breakage Costs within five Business Days
after the same shall have become due hereunder; or
(b) The Borrower shall fail to pay any other amount payable
hereunder or under any other Transaction Document when due and such
failure shall continue for a period of ten Business Days after receipt by
the Borrower of written notice that such payment is overdue given to the
Borrower by any Transaction Agent or any Lender (through the Security
Trustee); or
(c) Any representation or warranty made by the Borrower herein or
pursuant to Section 6.2(a)(v) or any other Transaction Document or any
amendment or modification hereof or thereof or waiver hereunder or
thereunder, or in any report, certificate or other document (other than
financial statements and other documents, including exhibits, filed with
the SEC) prepared by the Borrower and furnished pursuant to or in
connection with this Agreement or any other Transaction Document or any
amendment or modification hereof or thereof or waiver hereunder or
thereunder shall prove to have been incorrect in any material respect when
made, such incorrect representation or warranty is material at the time in
question, and, if curable, the same shall remain uncured for a period in
excess of 30 days (or in the case of any representation or warranty made
in Section 3.1(g) hereof with respect to a Potential Default, 60 days)
after the date of written notice thereof from any Transaction Agent or any
Lender (through the Security Trustee); or
(d) The Borrower shall fail to perform or observe any term,
covenant or agreement contained in this Agreement or any other Transaction
Document on its part to be performed or observed and such failure shall
remain unremedied for a period of 30 days after written notice of such
failure shall have been given to the Borrower by any Transaction Agent or
any Lender (through the Security Trustee), unless such failure is capable
of being corrected and the Borrower shall be diligently proceeding to
correct such failure, in which case there shall be no Event of Default
unless and until such failure shall continue unremedied for a period of 60
days after receipt of such notice; or
(e) The Borrower shall consent to the appointment of or the taking
of possession by a receiver, trustee or liquidator of itself or of
substantially all of its property, or the Borrower shall admit in writing
its inability to pay its debts generally as they come due, or does not pay
its debts generally as they become due or shall make a general assignment
for the benefit of creditors, or the Borrower shall file a voluntary
petition in bankruptcy or a voluntary petition or an answer seeking
reorganization,
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liquidation or other relief in a case under any bankruptcy laws or other
insolvency laws (as in effect at such time), or the Borrower shall seek
relief by voluntary petition, answer or consent, under the provisions of
any other bankruptcy or other similar law providing for the reorganization
or winding-up of corporations (as in effect at such time) or the
Borrower's board of directors shall adopt a resolution authorizing any of
the foregoing; or
(f) An order, judgment or decree shall be entered by any court of
competent jurisdiction appointing, without the consent of the Borrower, a
receiver, trustee or liquidator of the Borrower or of substantially all of
its property, or substantially all of the property of the Borrower shall
be sequestered, and any such order, judgment or decree of appointment or
sequestration shall remain in force undismissed, unstayed and unvacated
for a period of 90 days after the date of entry thereof; or a petition
against the Borrower in a case under any bankruptcy laws or other
insolvency laws (as in effect at such time) is filed and not withdrawn or
dismissed within 90 days thereafter, or if, under the provisions of any
law providing for reorganization or winding-up of corporations which may
apply to the Borrower, any court of competent jurisdiction assumes
jurisdiction, custody or control of the Borrower or of substantially all
of its property and such jurisdiction, custody or control remains in force
unrelinquished, unstayed and unterminated for a period of 90 days; or
(g) The Borrower shall fail to carry and maintain, or cause to be
carried and maintained, insurance on and in respect of any Engine in
accordance with the provisions of Section 3.05 of the Mortgage; or
(h) The Borrower shall cease to be a Certificated Air Carrier; or
(i) The Mortgage shall for any reason cease to be a valid first
priority perfected security interest (subject to Permitted Liens) in favor
of the Security Trustee in the Borrower's right, title and interest in and
to the Engines under the laws of the United States of America (assuming
the Engines are located within the United States of America) and, if any
Engine is subject to a lease to a lessee domiciled in any other
jurisdiction, such jurisdiction (assuming such Engine is located within
such jurisdiction); or
(j) an "Event of Default" under the Related Loan Agreement shall
have occurred and is continuing.
then, if an Event of Default referred to in clause (e) or (f) of this Section
7.1 shall have occurred and be continuing, (x) the principal of the Loan then
outstanding, together with interest accrued but unpaid thereon, LIBOR Breakage
Costs, the Prepayment Fee (if applicable), and all other amounts owing to the
Transaction Agents and any Lender hereunder or under any other Transaction
Document, shall immediately and without further act become due and payable, and
(y) the Commitments shall automatically terminate, in each case without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived by the Borrower and, if any other Event of Default shall have
occurred and be continuing, then the Administrative Agent shall, upon request of
the Required Lenders, by notice to the Borrower, terminate the
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Commitments and declare the unpaid principal of the Loans then outstanding,
together with interest accrued but unpaid thereon, LIBOR Breakage Costs and all
other amounts due to the Transaction Agents and any Lender hereunder or under
any other Transaction Document, to be forthwith due and payable, whereupon the
Commitments shall terminate and the Loans, all such interest and all other
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower. In addition to any other remedies available to the
Transaction Agents and the Lenders under the Transaction Documents or at law or
otherwise, if an Event of Default shall have occurred and so long as the same
shall be continuing unremedied, then and in every such case the Security Trustee
may exercise any or all of the rights and powers and pursue any and all of the
remedies set forth in the Mortgage.
ARTICLE VIII
THE TRANSACTION AGENTS
Section 8.1. Appointment and Authorization. Each Lender hereby irrevocably
designates and appoints General Electric Capital Corporation as the
"Administrative Agent", and Xxxxx Fargo Bank Northwest, National Association, as
the "Security Trustee" (collectively, the "Transaction Agents") under the
Transaction Documents and authorizes each Transaction Agent to take such actions
and to exercise such powers as are delegated to it thereby and to exercise such
other powers as are reasonably incidental thereto. No Transaction Agent shall
have any duties other than those expressly set forth in a Transaction Document
or any fiduciary relationship with any Lender, and no implied obligations or
liabilities shall be read into this Agreement, or otherwise exist, against any
Transaction Agent. The Transaction Agents do not assume, nor shall they be
deemed to have assumed, any obligation to, or relationship of trust or agency
with, the Borrower. Notwithstanding any provision of this Agreement or any other
Transaction Document, in no event shall any Transaction Agent ever be required
to take any action which exposes it to personal liability or which is contrary
to the provision of any Transaction Document or applicable law.
Section 8.2. Delegation of Duties. Each of the Transaction Agents may
execute any of its duties through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
Section 8.3. Exculpatory Provisions. No Transaction Agent nor any of their
respective directors, officers, agents or employees shall be liable to any
Lender for any action taken or omitted (i) with the consent or at the direction
of the Required Lenders or (ii) in the absence of such Person's gross negligence
or willful misconduct. No Transaction Agent shall be responsible to any Lender
or other Person for (a) any recitals, representations, warranties or other
statements made by the Borrower or any of its Affiliates, (b) the value,
validity, effectiveness, genuineness, enforceability or sufficiency of any
Transaction Document, (c) any failure of the Borrower or any of its Affiliates
to perform any obligation or (d) the satisfaction of any condition specified in
Article VI. No Transaction Agent shall have any obligation to any Lender to
ascertain or inquire about the observance or performance of any agreement
contained in any Transaction Document or to inspect the properties, books or
records of the Borrower or any of its Affiliates.
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Section 8.4. Reliance by Transaction Agents. As between the Transaction
Agents and the Lenders, each of the Transaction Agents shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any document,
other writing or conversation reasonably believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person and upon
advice and statements of legal counsel (including counsel to the Borrower or any
of its Affiliates), independent accountants and other experts selected by such
Transaction Agent. Each of the Transaction Agents shall in all cases be fully
justified in failing or refusing to take any action under any Transaction
Document unless it shall first receive such advice or concurrence of the
Lenders, and assurance of its indemnification, as it deems appropriate. Subject
to Section 9.1, no Transaction Agent shall effect any waiver or grant any
consent or make any determination (except as provided in Section 1.7(a)) without
the direction of the Required Lenders.
Section 8.5. Notice of Events of Default. No Transaction Agent shall be
deemed to have knowledge or notice of the occurrence of any Potential Default
unless it has received notice from any Lender or the Borrower stating that a
Potential Default has occurred hereunder and describing such Potential Default.
Promptly upon receiving notice of the occurrence of any Potential Default, a
Transaction Agent shall notify each Lender and the other Transaction Agent of
such occurrence. The Transaction Agents shall take such action concerning a
Potential Default as may be directed by the Required Lenders (or, if required
for such action, all of the Lenders), but until a Transaction Agent receives
such directions, each Transaction Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, as such Transaction Agent deems
advisable and in the best interests of the Lenders.
Section 8.6. Non-Reliance on Transaction Agents and Other Lenders; Lender
Representations. Except as set forth in Section 3.3 with respect to the Security
Trustee, each Lender expressly acknowledges that no Transaction Agent nor any of
their respective officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by a
Transaction Agent hereafter taken, including any review of the affairs of the
Borrower or any of its Affiliates, shall be deemed to constitute any
representation or warranty by such Transaction Agent. Each Lender represents and
warrants to each of the Transaction Agents that, independently and without
reliance upon the Transaction Agents or any other Lender and based on such
documents and information as it has deemed appropriate, it has made and will
continue to make its own appraisal of and investigation into the business,
operations, property, prospects, financial and other conditions and
creditworthiness of the Borrower and its own decision to enter into this
Agreement and to take, or omit, action under any Transaction Document. Except
for items specifically required to be delivered hereunder, no Transaction Agent
shall have any duty or responsibility to provide any Lender with any information
concerning the Borrower or any of its Affiliates that comes into the possession
of such Transaction Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
Section 8.7. Transaction Agents and Affiliates. Each of the Transaction
Agents and its Affiliates may extend credit to, accept deposits from and
generally engage in any kind of business with the Borrower or any of its
Affiliates and, in its role as a Lender, General Electric Capital Corporation
may exercise or refrain from exercising its rights and powers as if it were not
Administrative Agent.
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Section 8.8. Indemnification. Each Lender shall indemnify and hold
harmless each of the Transaction Agents and its officers, directors, employees,
representatives and agents (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably in accordance
with its Percentage Share (or, after the Commitments have been terminated, its
Ratable Share) from and against any and all liabilities, obligations, losses,
damages, penalties, judgments, settlements, costs, expenses and disbursements of
any kind whatsoever (including in connection with any investigative or
threatened proceeding, whether or not such Transaction Agent or such Person
shall be designated a party thereto) that may at any time be imposed on,
incurred by or asserted against such Transaction Agent or such Person as a
result of, or related to, any of the transactions contemplated by the
Transaction Documents or the execution, delivery or performance of the
Transaction Documents or any other document furnished in connection therewith
(but excluding any such liabilities, obligations, losses, damages, penalties,
judgments, settlements, costs, expenses or disbursements resulting solely from
the gross negligence or willful misconduct of such Transaction Agent or such
Person as finally determined by a court of competent jurisdiction).
Section 8.9. Successor Transaction Agents. Each Transaction Agent may,
upon at least 30 days notice to the Borrower and each Lender, resign its
position as a Transaction Agent. Such resignation shall not become effective
until a successor Transaction Agent acceptable to the Borrower is appointed by
the Required Lenders and has accepted such appointment. Upon such acceptance of
its appointment as a Transaction Agent hereunder by a successor Transaction
Agent, such successor Transaction Agent shall succeed to and become vested with
all the rights and duties of the retiring Transaction Agent, and the retiring
Transaction Agent shall be discharged from its duties and obligations under the
Transaction Documents. After any retiring Transaction Agent's resignation
hereunder, the provisions of Article V and this Article VIII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was a
Transaction Agent.
Section 8.10. Qualifications of Successor Security Trustee. Any successor
Security Trustee, however appointed, shall be a bank or trust company having a
combined capital and surplus of at least $500,000,000 and be incorporated in the
United States, so long as such an institution is willing, able and legally
qualified to perform the duties of the Security Trustee hereunder upon
reasonable or customary terms.
ARTICLE IX
MISCELLANEOUS
Section 9.1. Amendments. Neither this Agreement nor any other Transaction
Document nor any terms hereof or thereof may be changed, waived, discharged or
terminated (excluding any Mortgage Supplement contemplated by the Mortgage)
unless such change, waiver, discharge or termination is in writing signed by the
Borrower and the Required Lenders, provided that no such change, waiver,
discharge or termination shall, without the consent of each Lender affected
thereby, (i) extend the final scheduled maturity of the Loan or any Note, or
reduce the rate or extend the time of payment of interest or fees thereon, or
reduce the principal amount thereof, (ii) increase the Commitment of any Lender,
(iii) release any Collateral (except as expressly provided in the Mortgage),
(iv) amend, modify or waive any provision of this Section 9.1, (v) reduce the
percentage specified in the definition of Required Lenders, (vi)
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consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement or (vii) impair any indemnity under a
Transaction Document in favor of such Lender; provided, further, that no such
change, waiver, discharge or termination shall without the consent of a
Transaction Agent, amend, modify or waive any provision of Article VIII as same
applies to such Transaction Agent or any other provision as same relates to the
rights or obligations of such Transaction Agent.
Section 9.2. Notices. Unless otherwise specified, all notices and other
communications hereunder shall be in writing (including by facsimile
communication), given to the appropriate Person at its address or facsimile
number set forth on the signature pages hereof, or at such other address or
facsimile number as such Person may specify, and effective when received at the
address specified by such Person. The number of days for any advance notice
required hereunder may be waived (orally or in writing) by the Person receiving
such notice and, in the case of notices to the Security Trustee, the consent of
each Person to which the Security Trustee is required to forward such notice.
Section 9.3. Costs and Expenses. The Borrower agrees to pay at or prior to
Closing, after receipt of reasonably detailed invoices, all reasonable and
actual costs and expenses of the initial Lender and each Transaction Agent in
connection with the preparation, execution and delivery of the Transaction
Documents and Additional Documents (whether or not any such Transaction Document
or Additional Document is entered into), including, without limitation the
reasonable fees and expenses of (a) Holland & Knight LLP, special counsel to the
Lenders, (b) Weil, Gotshal & Xxxxxx, special bankruptcy counsel to the Lenders,
(c) Ray, Xxxxxxx & Xxxxxxx, special counsel to the Security Trustee, and (d)
Daugherty, Fowler, Peregrin & Xxxxxx, FAA counsel. The Borrower further agrees
to pay on demand (i) the initial and annual fees, and the reasonable expenses
of, the Security Trustee in connection with the transactions contemplated hereby
and (ii) all reasonable and actual costs and expenses of each Transaction Agent
and the Lenders, if any (including, without limitation, reasonable counsel fees
and expenses), in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of the Transaction Documents after the
occurrence of an Event of Default (including, without limitation, reasonable
fees and expenses of one counsel for the Security Trustee and one counsel for
all of the Lenders in connection with the enforcement of their rights under the
Transaction Documents).
Section 9.4. Certain Agreements . (a) Each Lender and each Transaction
Agent agrees as to itself with the Borrower that, so long as no Event of Default
shall have occurred and be continuing, such person shall not (and shall not
permit any Affiliate or other person claiming by, through or under it to) take
or cause to be taken any action contrary to the Borrower's right to quiet
enjoyment of the Collateral, and to possess, use, retain and control the Engines
and all revenues, income and profits derived therefrom without hindrance.
(b) Each Lender agrees to comply with its obligations under the
Mortgage.
Section 9.5. Entire Agreement. The Transaction Documents and Additional
Documents constitute the entire understanding of the parties thereto concerning
the subject matter thereof. Any previous agreements, whether written or oral,
concerning such matters are superseded thereby.
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Section 9.6. Cumulative Rights and Severability. All rights and remedies
of the Lenders and the Transaction Agents hereunder shall be cumulative and
non-exclusive of any rights or remedies such Persons have under law or
otherwise. Any provision hereof that is prohibited or unenforceable in any
jurisdiction shall, in such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof and without affecting such provision in any other jurisdiction.
Section 9.7. Waivers. No failure or delay of any party hereto in
exercising any power, right, privilege or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right, privilege or remedy preclude any other or further exercise thereof or the
exercise of any other power, right, privilege or remedy. Any waiver hereof shall
be effective only in the specific instance and for the specific purpose for
which such waiver was given. After any waiver, the Borrower, the Lenders and the
Transaction Agents shall be restored to their former position and rights and any
Potential Default waived shall be deemed to be cured and not continuing, but no
such waiver shall extend to (or impair any right consequent upon) any subsequent
or other Potential Default.
Section 9.8. Successors and Assigns; Participations; Assignments.
(a) Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and assigns. Except as otherwise provided herein, the Borrower
may not assign or transfer any of its rights or delegate any of its duties
without the prior consent of the Transaction Agents and each of the
Lenders.
(b) Participations. Any Lender may sell to one or more Persons
(each a "Participant") participating interests in the interests of such
Lender hereunder. Such Lender shall remain solely responsible for
performing its obligations hereunder, and the Borrower and the Transaction
Agents shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations hereunder. Each
Participant shall be entitled to the benefits of Article V; provided that
such Participant shall not be entitled to any greater benefit under
Article V than the Lender that sold the participating interest to the
Participant would have been entitled to thereunder and no Participant
shall be entitled to any benefit thereunder unless it shall perform such
obligations as are imposed on the Lenders under Article V. A Lender shall
not agree with a Participant to restrict such Lender's right to agree to
any amendment, waiver or modification hereto, except amendments described
in the proviso to Section 9.1.
(c) Assignments. Notwithstanding the foregoing, any Lender may
assign all or a portion of its Commitment and its outstanding Notes to a
Qualified Affiliate of such Lender or assign all, or if less than all, a
portion equal to at least $5,000,000 in the aggregate face amount of Notes
and of such Commitment (and related Obligations) to one or more Eligible
Assignees, each of which assignees referred to in Section 9.8(c) shall
become a party to this Agreement as a Lender by execution of a supplement
hereto in the form of Exhibit F (a "Transfer Supplement") hereto, provided
that (i) such transfer or assignment will not be effective until recorded
by the Security Trustee on the Register pursuant to Section 9.8(d) hereof,
and (ii) the Original Series A Lender and the Original
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Series B Lender shall at all times retain, between them in the aggregate,
at least 51% of the Aggregate Loan Amount. To the extent of any assignment
pursuant to this Section 9.8(c) (other than an assignment to a Qualified
Affiliate pursuant to the preceding sentence), the assigning Lender shall
be relieved of its obligations hereunder with respect to its assigned
Commitment. At the time of each assignment pursuant to this Section 9.8(c)
to a Person which is not already a Lender hereunder, the respective
assignee Lender shall provide to the Borrower and the Security Trustee the
Internal Revenue Service forms (and, if applicable, a Certificate re
Non-Bank Status) required by Section 5.3 (c)(i).
(d) Register. The Borrower hereby designates the Security Trustee
to serve as the Borrower's agent, solely for purposes of this Section
9.8(d), to maintain a register (the "Register") on which it will record
the registered holder of the Notes of each Series and the registration of
transfers of Notes of each Series made pursuant to and in accordance with
Section 9.8(c). The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice, and the Security Trustee shall, reasonably
promptly after (a) any person becomes a Lender after the date hereof and
(b) any Lender alters or modifies its name or address, notify the Borrower
of and deliver to the Borrower a written update of the names and addresses
of all Lenders. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of the
Loan Amount of any Lender. With respect to any Lender, the transfer of the
Commitment of such Lender and the rights to the principal of, and interest
on, the Loan Amount made pursuant to such Commitment shall not be
effective until such transfer is recorded on the Register maintained by
the Security Trustee with respect to ownership of such Commitment and Loan
Amount and prior to such recordation all amounts owing to the transferor
with respect to such Commitment and Loan Amount shall remain owing to the
transferor. The registration of assignment or transfer of all or part of
the Commitment and the Loan Amount shall be recorded by the Security
Trustee on the Register only upon the acceptance by the Security Trustee
of a properly executed and delivered Transfer Supplement. Coincident with
the delivery of such a Transfer Supplement to the Security Trustee for
acceptance and registration of assignment or transfer of all or part of a
Loan Amount, or as soon thereafter as practicable, the assigning or
transferor Lender shall surrender the Notes evidencing such Loan Amount,
and thereupon one or more new Notes of the same series of Notes in the
same aggregate principal amount shall be issued by the Borrower to the
assigning or transferor Lender and/or the new Lender, as appropriate to
reflect such assignment. Such new Notes shall be authenticated by the
Security Trustee. By execution and delivery hereof, the Borrower request
and directs the Security Trustee to authenticate and deliver the Notes to
be issued hereunder and the Security Trustee agrees to do so.
Section 9.9. Confidentiality. None of the Transaction Agents nor any
Lender shall disclose any nonpublic information relating to the Borrower
(provided to it by the Borrower) or any Transaction Document or Additional
Document to any other Person without the consent of the Borrower, other than (a)
to such Transaction Agent's or Lender's Affiliates and its officers, directors,
employees, agents and advisors and, as contemplated by Section 9.8, to actual or
prospective assignees and participants, and then, in all such cases, only with
an undertaking by
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the party to whom such information is disclosed to keep such information
confidential, (b) as required by any law, rule or regulation or judicial
process, (c) as requested or required by any state, federal or foreign authority
or examiner regulating banks or banking, and (d) to the extent reasonably
necessary in connection with any dispute related to, or enforcement of, the
Transaction Documents or Additional Documents.
Notwithstanding anything to the contrary set forth herein or in any other
agreement to which the parties hereto are parties or by which they are bound,
the obligations of confidentiality contained herein and therein, as they relate
to the transactions described in the Transaction Documents and the Additional
Documents (the "Transaction"), shall not apply to the U. S. federal tax
structure or U. S. federal tax treatment of the Transaction, and each party
hereto (and any employee, representative, or agent of any party hereto) may
disclose to any and all persons, without limitation of any kind, the U. S.
federal tax structure and U. S. federal tax treatment of the Transaction. The
preceding sentence is intended to cause the Transaction to be treated as not
having been offered under conditions of confidentiality for purposes of Section
1.6011-4(b)(3) (or any successor provision) of the Treasury Regulations
promulgated under Section 6011 of the Internal Revenue Code of 1986, as amended,
and shall be construed in a manner consistent with such purpose. In addition,
each party hereto acknowledges that it has no proprietary or exclusive rights to
the U. S. federal tax structure of the Transaction or any U. S. federal tax
matter or U. S. federal tax idea related to the Transaction.
Section 9.10. Counterparts. This Agreement may be executed by different
parties on any number of counterparts, each of which shall constitute an
original and all of which, taken together, shall constitute one and the same
agreement.
Section 9.11. Governing Law; Submission to Jurisdiction; Venue.
(a) This Agreement and the rights and obligations of the parties
hereunder and thereunder shall be construed in accordance with and be governed
by the laws of the State of New York. Any legal action or proceeding with
respect to this Agreement may be brought in the courts of the State of New York
or the United States for the Southern District of New York located in the
Borough of Manhattan, and, by execution and delivery of this Agreement or a
Transfer Supplement, each party hereto hereby irrevocably accepts for itself and
in respect of its property, generally and unconditionally, the jurisdiction of
the aforesaid courts. Each party hereto hereby further irrevocably waives any
claim that any such courts lack jurisdiction over such party, and agrees not to
plead or claim, in any legal action or proceeding with respect to this Agreement
brought in any of the aforesaid courts, that any such court lacks jurisdiction
over such party. Each party hereto further irrevocably consents to the service
of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at its address specified pursuant to Section 9.2, such
service to become effective 30 days after such mailing. Nothing herein shall
affect the right of any party hereto to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
any other party hereto in any other jurisdiction.
(b) Each party hereto hereby irrevocably waives any objection which it
may now or hereafter have to the laying of venue of any of the aforesaid actions
or proceedings arising out of or in connection with this Agreement brought in
the courts referred to in clause (a) above and
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hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.
Section 9.12. Waiver of Trial by Jury. To the extent permitted by
applicable law, each party hereto irrevocably waives all right of trial by jury
in any action, proceeding or counterclaim arising out of, or in connection with,
any Transaction Document or any matter arising thereunder.
Section 9.13. Effective Date. Although this Agreement is dated as of
September 3, 2004, it shall not be effective unless and until executed by the
parties listed on the signature pages hereto.
[Remainder of this page blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
GENERAL ELECTRIC CAPITAL CORPORATION
as the Administrative Agent
By: /s/ Xxxxxx Xxx
____________________________________
Name: Xxxxxx Xxx
Title: Vice President
Address:
General Electric Capital Corporation
c/o GE Capital Aviation Services, Inc.
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Customer Services
Facsimile: (000) 000-0000
email: Xxxxxxxxx@xxxxx.xxx
XXXXX FARGO BANK NORTHWEST,
NATIONAL ASSOCIATION
as the Security Trustee
By: /s/ Xxxxxxx X. Xxxxxx
__________________________________
Title: Vice President
______________________________
Address:
Xxxxx Fargo Bank Northwest, National
Association
MAC: U1228-120
000 Xxxxx Xxxx Xxxxxx
00xx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Attention: Corporate Trust Services
Telephone: (000) 000 0000
Telecopy: (000) 000-0000
Email: xxxxxxx.xxxxxx@xxxxxxxxxx.xxx
AMERICA WEST AIRLINES, INC.
By: /s/ Xxxxxx X. Xxxx
____________________________________
Name: Xxxxxx X. Xxxx
Title: Vice President and Treasurer
Address:
America West Airlines, Inc.
0000 X. Xxx Xxxxxx Xxxx.
Xxxxxxx, Xxxxxxx 00000
Attention: Vice President and Treasurer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
email: xxx.xxxx@xxxxxxxxxxx.xxx
GENERAL ELECTRIC CAPITAL
CORPORATION
as Original Series A Lender
By: /s/ Xxxxxx Xxx
____________________________________
Name: Xxxxxx Xxx
Title: Vice President
GENERAL ELECTRIC CAPITAL
CORPORATION
as Original Series B Lender
By: /s/ Xxxxxx Xxx
____________________________________
Name: Xxxxxx Xxx
Title: Vice President
Notice Address and Lending Office:
General Electric Capital Corporation
c/o GE Capital Aviation Services, Inc.
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Customer Services
Facsimile: (000) 000-0000
email: Xxxxxxxxx@xxxxx.xxx
SCHEDULE 1
DEFINITIONS AND OTHER INTERPRETIVE PROVISIONS
1. Definitions. The following terms have the meanings set forth, or
referred to, below:
"Act" means part A of subtitle VII of title 49, United States Code.
"Actual Knowledge" means, with respect to (i) any Lender, actual
knowledge of any officer of such Lender having responsibility for the
transactions contemplated by the Transaction Documents and (ii) any other
Person, actual knowledge of a Vice President or more senior officer of
such Person or any other officer of such Person having responsibility for
the transactions contemplated by the Transaction Documents.
"Additional Documents" means the Payment and Indemnity Agreement,
the Subordinated Mortgage and each Subordinated Mortgage Supplement.
"Administrative Agent" is defined in the first paragraph of this
Agreement.
"Administrative Agent's Account" means the Administrative Agent's
account number 00-000-000, reference AWA Engine Loan, at Deutsche Bank
Trust Company Americas, New York branch, ABA No. 000-000-000, Swift Code
BKTRUS 33, or such other account at a bank in the United States designated
to the Borrower and the Lenders by the Administrative Agent.
"Affected Lender" is defined in Section 1.7(c).
"Affected Loan Amount" is defined in Section 1.7(c).
"Affiliate" means, with respect to any Person, any other Person,
directly or indirectly, controlling, controlled by, or under common
control with such Person. For purposes of this definition, "control" means
the power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether through the ownership of
voting securities, by contract or otherwise, and "controlling,"
"controlled by," and "under common control with" have correlative
meanings.
"Aggregate Commitment" means $35,000,000.
"Aggregate Loan Amount" means the sum of the Loan Amounts of all
Lenders.
"Agreement" is defined in the first paragraph of this Agreement.
"Applicable Margin" means (a) with respect to the Original Series A
Note and the Original Series B Note 3.0% per annum, and (b) with respect
to any Replacement Note, the percentage set forth in such Note.
"ATSB" means the Air Transportation Stabilization Board, or any
agency which may succeed to the rights, duties and obligations thereof
under applicable law.
"Bankruptcy Code" means Title 11 of the United States Code, as the
same may be amended.
"Xxxx of Sale" means a xxxx of sale, delivery invoice or such other
evidence of title to an Engine issued by the applicable Engine
Manufacturer to the Borrower.
"Borrower" is defined in the first paragraph of this Agreement.
"Borrower's Account" means initially the account set forth in
Section 1.2(a) or any subsequent account designated in writing by the
Borrower to the Security Trustee and Administrative Agent from time to
time.
"Business Day" means any day other than (i) a Saturday, Sunday or
other day on which banks in New York City or Phoenix, Arizona are
authorized or required by law to close, and (ii) with respect to all
notices and determinations in connection with, and borrowings and payments
of principal and interest on the Loan, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and
between banks in the London interbank Eurodollar market.
"Capital Adequacy Change" is defined in Section 5.2.
"Certificate re Non-Bank Status" means a certificate substantially
in the form of Exhibit G annexed hereto.
"Certificated Air Carrier" is defined in the Mortgage.
"Closing" means the time at which the Loan has been advanced to the
Borrower.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" is defined in the Mortgage.
"Commitment" means (a) with respect to the Original Series A Lender,
its Series A Commitment and (b) with respect to the Original Series B
Lender, its Series B Commitment. The aggregate amount of the Commitments
is set forth in the definition of Aggregate Commitment.
"Commitment Termination Date" means September 30, 2004.
"Default Rate" is defined in Section 2.4.
"Designated Country" means the United States, the United Kingdom,
the Netherlands, Germany, France, Austria, Luxembourg, Switzerland, Italy,
Japan and Ireland.
"Designated Date" means the day coinciding with the thirtieth (30th)
monthly anniversary of the Funding Date.
"Dollar" and "$" means lawful currency of the United States of
America.
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"Eligible Assignee" means (i) prior to the termination of the
Commitments in full, a Person approved by the Borrower which approval
shall not be unreasonably withheld or delayed and which approval shall not
be required if an Event of Default shall be continuing and (ii) after the
termination of the Commitments in full, a bank or other financial
institution nominated by a Lender.
"Engine" means any engine described in Annex A to a Mortgage
Supplement and any engine substituted for an Engine in accordance with the
terms of the Mortgage, but excluding any Engine that has been released
from the Lien of the Mortgage in accordance with the terms thereof.
"Engine Manufacturer" means (i) with respect to Engine models
CFM56-3-B1 and CFM56-3-B2, CFM International, Inc., or (ii) with respect
to Engine models RB211-535E4, Rolls Royce or (iii) with respect to Engine
Models V2500-A1, V2524-A5, and V2527-A5, International Aero Engines, Inc.
"Engine Payment Date" has the meaning specified in Section 1.1(d).
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the relations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA as in effect
at the date of this Agreement and any subsequent provisions of ERISA
amendatory thereof, supplemental thereto or substituted therefor.
"Event of Default" is defined in Section 7.1.
"Exchange Event" has the meaning set forth in the Restructure
Letter.
"Excluded Tax" of a Person means (A) any Tax imposed on all or part
of the income, profits or gains (whether worldwide, or only insofar as
such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction) of that Person, any franchise, doing business,
net worth or capital-based Tax imposed on that Person, and any intangibles
Tax or similar Tax imposed on the principal amount or value of the Loans,
by any jurisdiction (including the United States) (i) in which that Person
is organized, (ii) in which that Person's principal office or applicable
Lending Office is located, or (iii) in which that Person is subject to
such Tax as a result of that Person doing business unrelated to making a
Loan under this Agreement, (B) any Tax imposed on a transferee (including
a Participant) of a Lender or on payments to a transferee to the extent
that, under applicable law in effect on the date of the transfer to such
transferee, the amount of such Taxes exceeds the amount of such Taxes that
would have been imposed on the transferor to such transferee or on
payments to such transferor and indemnified against hereunder (with
appropriate adjustment to reflect the amount of the Loan acquired by such
transferee) or (C) any Tax to the extent that liability for such Tax is
caused by, and would not have been incurred but for, (i) the gross
negligence or willful misconduct of such Person or a "related" Indemnitee
(as defined in Section 5.5(a)) or (ii) the inaccuracy of any
representation of such Person in any Transaction Document or (iii) the
breach by such Person of any of its obligations under Section 5.3(c)(i).
-3-
"FAA" means the Federal Aviation Administration of the United States
Department of Transportation, or any agency which may succeed to the
rights, duties and obligations thereof under applicable law.
"FAA Filed Documents" means the Release, the Mortgage, the
Subordinated Mortgage and the Mortgage Supplement and Subordinated
Mortgage Supplement.
"Federal Aviation Act" means Title 49 of the United States Code
which, among other things, recodified and replaced the U.S. Federal
Aviation Act of 1958 and the regulations promulgated thereunder, or any
subsequent legislation that amends, supplements or supersedes such
provisions.
"Fee Letter" means the Fee Letter dated as of September 3, 2004
between the Administrative Agent and the Borrower.
"Financing Statements" means Uniform Commercial Code financing
statements covering all the security interests in the Collateral created
by or pursuant to the Mortgage and Subordinated Mortgage necessary or
desirable to perfect said security interests.
"Funding Date" means September 10, 2004 (or such later date on or
prior to the Commitment Termination Date on which the Borrower requests
the Lenders to fund the Loan in accordance with Section 1.2).
"GAAP" means generally accepted accounting principles as set forth
in the statements of financial accounting standards issued by the
Financial Accounting Standards Board of the American Institute of
Certified Public Accountants, as such principles may at any time or from
time to time be varied by any applicable financial accounting rules or
regulations issued by the SEC and, with respect to any Person, means such
principles applied on a basis consistent with prior periods except as may
be disclosed in such Person's financial statements.
"Governmental Authority" means any (a) governmental entity, board,
bureau, agency or instrumentality, (b) administrative or regulatory
authority (including any central bank or similar authority) or (c) court,
judicial authority or arbitrator, in each case, whether foreign or
domestic.
"Interest Payment Date" means, subject to Section 1.8(b), the date
numerically corresponding to the Funding Date in each of March, June,
September and December, commencing the next such date occurring after the
Funding Date and the final such date for any Note shall be the Maturity
Date for such Note.
"Interest Period" means a period used for calculating the interest
rate applicable to the Loan, as determined pursuant to Section 2.2.
"Interest Rate Determination Date" means, with respect to any
Interest Period for a Loan, the second Business Day prior to the first day
of such Interest Period.
"Lenders" is defined in the first paragraph of this Agreement.
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"Lending Office" means the lending office of each Lender set forth
on the signature page of this Agreement with respect to such Lender, or
such other lending office as a Lender from time to time shall notify the
Borrower as its lending office hereunder; provided that a Lender shall
not, without the Borrower's request, change its Lending Office if it would
increase the Borrower's obligations under Section 1.7, 5.1, 5.2 or 5.3.
"LIBOR Breakage Costs" is defined in Section 1.7(d).
"LIBOR Rate" means, with respect to any Interest Period, the rate
appearing on Bloomberg Page BBAM 1 screen service (or on any successor or
substitute page of such service, or any successor to or substitute for
such service, providing rate quotations comparable to those currently
provided on such page of such service) at approximately 11:00 a.m., London
time, on the Interest Rate Determination Date for such Interest Period, as
the rate for dollar deposits with a maturity of three months. In the event
that such rate is not available at such time for any reason, then the
"LIBOR Rate" for such Interest Period shall be the average (rounded
upwards to the nearest 1/100%), as determined by the Administrative Agent,
of the per annum interest rates at which dollar deposits of amounts
comparable to the outstanding principal amount of the Loan and for a
maturity of three months are offered by the principal London offices of
the Reference Banks, in each case offered to prime banks in the London
interbank market, in each case at or about 11:00 a.m., London time, on the
Interest Rate Determination Date for such Interest Period.
"Lien" means any mortgage, pledge, lien, charge, claim, encumbrance,
lease, sublease, sub-sublease or security interest affecting the title to
or any interest in property.
"Lien of Record" means, with respect to any Engine, any Lien that is
recorded against such Engine in the records of the aircraft registry
maintained by the FAA in Oklahoma City, Oklahoma in accordance with the
Act (or any successor thereto under applicable law).
"Loan" means the aggregate amount of funds advanced by the Lenders
to the Borrower on the Funding Date pursuant to the terms of this
Agreement.
"Loan Amount" means, for each Lender, the aggregate outstanding
principal amount of the Notes held by such Lender.
"Material Adverse Change" means a material adverse change in the
business or financial condition of the Borrower and its Subsidiaries taken
as a whole or the material impairment of the ability of the Borrower to
perform, or the Transaction Agents or the Lenders to enforce, the
obligations of Borrower under the Transaction Documents.
"Maturity Date" means (a) with respect to the Original Series A Note
and the Original Series B Note, the sixth (6th) anniversary of the Funding
Date, and (b) with respect to any Replacement Note, the date designated
therein as the Maturity Date.
"Moody's" means Xxxxx'x Investors Service, Inc.
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"Mortgage" means the Engine Mortgage and Security Agreement in
substantially the form of Exhibit A-1 to this Agreement entered into by
the Borrower and the Security Trustee to secure the Loans.
"Mortgage Supplement" is defined in the Mortgage.
"Note" means a Series A or Series B promissory note of the Borrower
issued in connection with a Loan made by a Lender and payable to the order
of such Lender, in substantially the form of Exhibit B hereto, evidencing
the indebtedness of the Borrower to such Lender resulting from such Loan.
"Notice of Borrowing" means a notice substantially in the form of
Exhibit C annexed hereto delivered by the Borrower to the Administrative
Agent pursuant to Section 1.2(a) with respect to a proposed borrowing.
"Obligations" is defined in the Mortgage.
"Officer's Certificate" is defined in the Mortgage.
"Original Lender" shall mean the Original Series A Lender and/or the
Original Series B Lender.
"Other Taxes" means any and all present or future Taxes arising from
any payment made under any Transaction Document or from the execution,
delivery, performance, filing, recording or enforcement of, or otherwise
with respect to, any Transaction Document or the transactions contemplated
by the Transaction Documents.
"Participant" is defined in Section 9.8(b).
"Payment and Indemnity Agreement" means the Payment and Indemnity
Agreement [Engines] dated as of the date hereof among the Borrower, the
Administrative Agent and the Security Trustee.
"Payment Date" means, subject to Section 1.8(b), the date
numerically corresponding to the Funding Date in each of March, June,
September and December, commencing with such date in December, 2004. The
final "Payment Date" for any Note shall be the Maturity Date for such
Note.
"Percentage Share" means, for each Lender, such Lender's Commitment
divided by the Aggregate Commitment.
"Permitted Disposition" is defined in the Mortgage.
"Permitted Investments" is defined in the Mortgage.
"Permitted Liens" is defined in the Mortgage.
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"Persons" or "persons" means individuals, firms, partnerships, joint
ventures, trusts, trustees, Governmental Authorities, organizations,
associations, corporations, limited liability companies, or any
committees, departments, authorities and other bodies thereof, corporate
or incorporate, whether having distinct legal status or not, or any member
of any of the same.
"Potential Default" means any Event of Default or any event or
condition that with the lapse of time or giving of notice, or both, would
constitute an Event of Default.
"Prepayment Date" has the meaning specified in Section 1.1(c)(i).
"Prepayment Fee" means, with respect to any prepayment of the Loan
(other than any prepayment pursuant to Section 1.1(d) or Section 1.6) on
or before the forty second monthly anniversary of the Funding Date, an
amount equal to one percent (1%) of the principal amount of the Loan so
prepaid as of the date of such prepayment.
"Qualified Affiliate" means, as to any Lender, an Affiliate of such
Lender engaged in the business of making loans.
"Ratable Share" means, for each Lender, such Lender's Loan Amount
divided by the Aggregate Loan Amount.
"Reference Banks" means (a) Deutsche Bank, (b) Citibank, N.A., (c)
JPMorgan Chase Bank, and (d) such other bank or banks as may from time to
time be agreed by the Borrower and the Required Lenders.
"Register" is defined in Section 9.8(d).
"Regulatory Change" is defined in Section 5.1.
"Related Loan Agreement" means that certain Loan Agreement [Spare
Parts] dated the date hereof among the Borrower, the Administrative Agent,
the Security Trustee, the Original Series A Lender and the Original Series
B Lender.
"Release" means the Release in respect of each of the Engines from
the Lien of the Spare Engine and Simulator Security Agreement, dated as of
December 12, 1997 between the Borrower and Mizuho Corporate Bank, Ltd. as
assignee from The Industrial Bank of Japan, Limited as Agent and assigned
FAA Conveyance No. K15691, as amended and assigned.
"Replacement Notes" means the Replacement Notes issued in accordance
with the terms of Section 1.11.
"Required Lenders" means Lenders having (i) Commitments in excess of
50% of the Commitment of all Lenders or (ii) if the Commitments have been
terminated, Loan Amounts in excess of 50% of the Aggregate Loan Amount.
-7-
"Restructure Letter" means the Restructure Letter [Engines], dated
as of September __, 2004 between the Administrative Agent and the
Borrower.
"SEC" means the Securities and Exchange Commission of the United
States, or any Governmental Authority succeeding to the functions of such
Securities and Exchange Commission.
"Security Trustee" is defined in the first paragraph of this
Agreement.
"Security Trustee Agreement" the Security Trustee Agreement
[Engines] dated as of the date hereof among the Beneficiaries (as defined
therein) and the Security Trustee.
"Series" means either the Series A Notes, collectively, or the
Series B Notes, collectively.
"Series A Commitment" means the amount set forth in Schedule 4
hereof.
"Series B Commitment" means the amount set forth in Schedule 4
hereof.
"Series A Note" means a promissory note substantially in the form of
Exhibit B hereto designated on its face as a "Series A Note", duly
completed and executed by Borrower.
"Series B Note" means a promissory note substantially in the form of
Exhibit B hereto designated on its face as a "Series B Note", duly
completed and executed by Borrower.
"Special Default" means any Event of Default pursuant to Section
7.1(a), and/or (b) or any event or condition that with the lapse of time
or giving of notice, or both, would constitute an Event of Default under
Section 7.1(a) and/or (b).
"Specified Engines" means the eight Engines bearing manufacturer's
serial numbers V10120, V10335, V10516, V10549, V10676, V10642, V10817 and
V10783.
"Subordinated Mortgage" means the Subordinated Engine Mortgage and
Security Agreement in substantially the form of Exhibit A-2 to this
Agreement entered into by the Borrower and the Security Trustee to secure
the obligations of the Borrower under the Payment and Indemnity Agreement.
"Subordinated Mortgage Supplement" is defined in the Subordinated
Mortgage.
"Subsidiary" means, as to any Person, any other Person of which at
least a majority of the voting stock (or equivalent equity interests) is
owned or controlled by such first Person or by one or more other
Subsidiaries.
"Substitute Basis" is defined in Section 1.7(f).
-8-
"Taxes" means all taxes, charges, fees, levies or other assessments
(including income, gross receipts, profits, withholding, excise, property,
sales, use, license, occupation and franchise taxes and including any
related interest, penalties or other additions) imposed by any
jurisdiction or taxing authority (whether international, foreign or
domestic).
"Threshold Amount" has the meaning set forth in Schedule 4 to this
Agreement.
"Transaction Agents" is defined in Section 8.1 hereof.
"Transaction Documents" means this Agreement, the Notes, the
Mortgage and each Mortgage Supplement, the Restructure Letter and the Fee
Letter.
"Transfer Supplement" is defined in Section 9.8(c).
"UCC" or "Uniform Commercial Code" means the Uniform Commercial Code
as in effect in any applicable jurisdiction.
"UCC Termination Statements" means the Delaware UCC Termination
Statement in respect of (i) the UCC Financing Statement 10758255 relating
to the IAE International Aero Engines bearing manufacturer serial numbers
V10676, V10783 and V10817 subject to the Lien of the Spare Engine and
Simulator Security Agreement, dated as of December 12, 1997, between the
Borrower and Mizuho Corporate Bank, Ltd. as assignee from The Industrial
Bank of Japan, Limited as Agent; and (ii) the UCC Financing Statement
32330358 relating to the CFM International, Inc. Engines bearing
manufacturer serial numbers 720601, 720772, 720867, 721179 and 721395, the
IAE International Aero Engines bearing serial numbers V0089, V0340,
V10120, V10335, V10516, V10549 and V10642 and the Rolls Royce Engine
bearing manufacturer serial number 30503.
"USA" means the United States of America (including all states and
political subdivisions thereof).
2. Other Interpretive Provisions. (a) The foregoing definitions shall
be equally applicable to both the singular and plural forms of the defined
terms. All terms defined directly or by incorporation in this Agreement shall
have the defined meanings when used in any certificate or other document
delivered pursuant hereto unless otherwise defined therein. For purposes of this
Agreement and all such certificates and other documents, unless the context
otherwise requires: (i) accounting terms not otherwise defined in this
Agreement, and accounting terms partly defined in this Agreement to the extent
not defined, shall have the respective meanings given to them under GAAP; (ii)
references to any amount as on deposit or outstanding on any particular date
means such amount at the close of business on such day; (iii) the words
"hereof," "herein" and "hereunder" and words of similar import refer to this
Agreement (or the certificate or other document in which they are used) as a
whole and not to any particular provision of this Agreement (or such certificate
or document); (iv) references to any Section, Schedule or Exhibit are references
to Sections, Schedules and Exhibits in or to this Agreement (or the certificate
or other document in which the reference is made), and references to any
-9-
paragraph, subsection, clause or other subdivision within any Section or
definition refer to such paragraph, subsection, clause or other subdivision of
such Section or definition; (v) the term "including" means "including without
limitation"; (vi) references to any law or regulation refer to that law or
regulation as amended from time to time and include any successor law or
regulation; (vii) references to any agreement refer to that agreement as from
time to time amended or supplemented or as the terms of such agreement are
waived or modified in accordance with its terms; (viii) references to any Person
include that Person's successors and assigns; and (ix) headings are for
convenience of reference only and shall not otherwise affect the meaning or
interpretation of any provision hereof.
(b) Each exhibit and schedule to this Agreement is incorporated in, and
shall be deemed a part of, this Agreement.
(c) All terms defined in the Mortgage and used herein have such
respective defined meanings unless otherwise defined herein.
-10-
SCHEDULE 2
Engine Descriptions
SERIAL DATE OF STIPULATED STIPULATED TERMINATION
ENGINE TYPE NUMBER MANUF. LOSS VALUE-A LOSS VALUE-B VALUE
----------- ------ ------ ------------ ------------ -----
CFM56-3B2 720601 Jan-87 $ 1,370,000 $ 1,250,000 $ 2,400,000
CFM56-3B2 721179 Apr-85 $ 1,370,000 $ 1,250,000 $ 2,400,000
CFM56-3B1 720772 May-88 $ 1,120,000 $ 1,010,000 $ 1,950,000
CFM56-3B1 720867 Jun-87 $ 1,120,000 $ 1,010,000 $ 1,950,000
CFM56-3B1 721395 Dec-85 $ 1,120,000 $ 1,010,000 $ 1,950,000
RB211-535E4 30503 Oct-84 $ 2,110,000 $ 1,920,000 $ 3,840,000
V2500-A1 V0089 Jul-89 $ 1,193,000 $ 1,750,000 $ 3,510,000
V2500-A1 V0340 Nov-93 $ 1,193,000 $ 1,750,000 $ 3,510,000
V2500-A1 V0334 Aug-93 $ 1,193,000 $ 1,750,000 $ 3,510,000
V2527-A5 V10120 Jun-95 $ 2,940,000 $ 2,670,000 $ 4,110,000
V2527-A5 V10335 Feb-98 $ 2,940,000 $ 2,670,000 $ 4,110,000
V2527-A5 V10516 Dec-98 $ 2,940,000 $ 2,670,000 $ 4,110,000
V2527-A5 V10549 May-99 $ 2,940,000 $ 2,670,000 $ 4,110,000
V2527-A5 V10676 Dec-99 $ 2,940,000 $ 2,670,000 $ 4,110,000
V2527-A5 V10642 Sep-99 $ 3,630,000 $ 3,300,000 $ 5,080,000
V2527-A5 V10817 Aug-00 $ 3,630,000 $ 3,300,000 $ 5,080,000
V2524-A5 V10783 Dec-00 $ 2,560,000 $ 2,330,000 $ 3,580,000
SCHEDULE 3
Principal Payments for the Notes
RATIO OF AGGREGATE AGGREGATE
PRINCIPAL PAYMENT TO PRINCIPAL PAYMENTS PRINCIPAL BALANCE
PAYMENT DATE ORIGINAL PRINCIPAL (IN DOLLARS) (IN DOLLARS)
------------ -------------------- ----------------- -----------------
Closing $ 35,000,000
December 10, 2004 0 $ 0 $ 35,000,000
March 10, 2005 0 $ 0 $ 35,000,000
June 10, 2005 0 $ 0 $ 35,000,000
September 10, 2005 0 $ 0 $ 35,000,000
December 10, 2005 0 $ 0 $ 35,000,000
March 10, 2006 1,289,474 / 35,000,000 $ 1,289,474 $ 33,710,526
June 10, 2006 1,289,474 / 35,000,000 $ 1,289,474 $ 32,421,052
September 10, 2006 1,289,474 / 35,000,000 $ 1,289,474 $ 31,131,578
December 10, 2006 1,289,474 / 35,000,000 $ 1,289,474 $ 29,842,104
March 10, 2007 1,289,474 / 35,000,000 $ 1,289,474 $ 28,552,630
June 10, 2007 1,289,474 / 35,000,000 $ 1,289,474 $ 27,263,156
September 10, 2007 1,289,474 / 35,000,000 $ 1,289,474 $ 25,973,682
December 10, 2007 1,289,474 / 35,000,000 $ 1,289,474 $ 24,684,208
March 10, 2008 1,289,474 / 35,000,000 $ 1,289,474 $ 23,394,734
June 10, 2008 1,289,474 / 35,000,000 $ 1,289,474 $ 22,105,260
September 10, 2008 1,289,474 / 35,000,000 $ 1,289,474 $ 20,815,786
December 10, 2008 1,289,474 / 35,000,000 $ 1,289,474 $ 19,526,312
March 10, 2009 1,289,474 / 35,000,000 $ 1,289,474 $ 18,236,838
June 10, 2009 1,289,474 / 35,000,000 $ 1,289,474 $ 16,947,364
September 10, 2009 1,289,474 / 35,000,000 $ 1,289,474 $ 15,657,890
December 10, 2009 1,289,474 / 35,000,000 $ 1,289,474 $ 14,368,416
March 10, 2010 1,289,474 / 35,000,000 $ 1,289,474 $ 13,078,942
June 10, 2010 1,289,474 / 35,000,000 $ 1,289,474 $ 11,789,468
September 10, 2010 11,789,468 / 35,000,000 $ 11,789,468 $ 0
Series A Note and Series B Note Maturity Date: Sixth anniversary of the Funding
Date.
SCHEDULE 4
Certain Information
"Maximum Self Insurance Amount" means, with respect to any Engine, the
standard market hull deductible in existence from time to time in the worldwide
airline insurance marketplace applicable to aircraft of the same type as the
aircraft on which such Engine is installed, but in no event greater than
$2,000,000 any one occurrence.
"Minimum Liability Amount" means $600,000,000.
"Series A Commitment" means $35,000,000.
"Series B Commitment" means $0.
"Threshold Amount" means $2,000,000.
EXHIBIT A-1
[Insert Form of Mortgage]
EXHIBIT A-2
[Insert Form of Subordinated Mortgage]
EXHIBIT B
FORM OF PROMISSORY NOTE
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR UNDER THE SECURITIES OR SIMILAR LAWS OF ANY STATE OR OTHER
JURISDICTION AND MAY NOT BE OFFERED, TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE SUCH A REGISTRATION UNDER THE ACT AND SUCH SECURITIES OR SIMILAR
LAWS IS IN EFFECT OR PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION.
THIS NOTE IS SUBJECT TO CERTAIN ADDITIONAL RESTRICTIONS ON TRANSFER SET FORTH IN
SECTION 9.8 OF THE LOAN AGREEMENT REFERRED TO BELOW.
SERIES [*] NOTE [ENGINES] DUE SEPTEMBER [__], 2010
No. [*] - New York, New York
_______, 200[]
$__________________
FOR VALUE RECEIVED, the undersigned, AMERICA WEST AIRLINES, INC., a
Delaware corporation (together with its successors and permitted assigns, the
"Borrower") hereby unconditionally promises to pay to _____________, or the
registered assignee thereof, the principal amount of ______________ DOLLARS
($_________), in lawful currency of the United States of America, in
installments on the Payment Dates set forth in Annex A hereto, each such
installment to be in the amount set forth in Annex A hereto opposite the Payment
Date on which such installment is due, and to pay interest in arrears on each
Interest Payment Date at the Debt Rate (as defined herein below) for the
Interest Period ending on such Interest Payment Date on the amount of such
principal amount remaining unpaid from time to time from the date hereof until
such principal amount is paid in full; provided that in the event (i) that this
Note shall have been prepaid in part pursuant to the Loan Agreement, from and
after the relevant Prepayment Date or Engine Payment Date (as the case may be),
the amounts of such installments shall be reduced, in inverse order of maturity,
by the amount of such partial prepayment and (ii) of any repayment or prepayment
of any principal amount hereof, accrued interest on the principal amount repaid
or prepaid shall be payable on the date of such repayment or prepayment; and
provided further that the final principal payment hereon shall in any and all
events equal the then outstanding principal balance hereof and such final
payment shall discharge all amounts due under this Note. Interest shall be
computed on the basis of a year of 360 days and the actual days elapsed
(including the first day but excluding the last day) in the period for which
interest is payable. The Applicable Margin for this Note is []% per annum. As
used herein, the term "Debt Rate" means the LIBOR Rate for the relevant Interest
Period plus the Applicable Margin, unless the Substitute Basis shall have become
applicable pursuant to Section 1.7 of the Loan Agreement, in which case the
"Debt Rate" shall mean the sum of the Substitute Basis and the Applicable
Margin.
Notwithstanding the foregoing, this Note shall bear interest at the
Default Rate on overdue principal and, to the extent permitted by applicable
law, on any interest and any other amounts payable hereunder not paid when due
and payable for any period during which the same shall be overdue, payable on
demand by the holder hereof.
This Note is one of the Notes referred to in, and is entitled to the
benefits of, the Loan Agreement [Engines] dated as of September 3, 2004, among
the Borrower, General Electric Capital Corporation, as Administrative Agent,
Xxxxx Fargo Bank Northwest, National Association, as Security Trustee, General
Electric Capital Corporation, as Original Series A Lender, and General Electric
Capital Corporation, as Original Series B Lender and the Lenders from time to
time party thereto (as amended or modified from time to time, the "Loan
Agreement"; the terms defined therein being used herein as therein defined). The
Loan Agreement, among other things, (i) provides for the making of a Series A
Loan and/or a Series B Loan by the Lenders to the Borrower on the Funding Date
and (ii) contains provisions for acceleration of the maturity hereof upon the
happening of certain stated events and also prepayments on account of principal
hereof prior to the maturity hereof upon the terms and conditions therein
specified. The obligations of the Borrower under this Note and the Loan
Agreement are secured by collateral as provided in the Engine Mortgage and
Security Agreement (as amended or supplemented from time to time) dated as of
September 3, 2004, executed by the Borrower and Xxxxx Fargo Bank Northwest,
National Association, as Security Trustee (the "Mortgage").
Each holder hereof, by its acceptance of this Note, agrees that each
payment received by it hereunder shall be applied, first, to the payment of any
amount (other than principal of or interest on this Note) then due in respect of
this Note, including, without limitation, LIBOR Breakage Costs, if any; second,
to the payment of accrued interest on this Note (as well as any interest on
overdue principal, or, to the extent permitted by law, on LIBOR Breakage Costs,
if any, on interest and on other amounts due hereunder) due and payable to the
date of such payment; and third, to the payment of principal then due hereunder
(applied, in the case of a partial prepayment, in inverse order of maturity).
There shall be maintained a Note Register for the purpose of registering
transfers and exchanges of Notes at the Corporate Trust Office of the Security
Trustee or at the office of any successor security trustee in the manner
provided in Section 9.8(d) of the Loan Agreement. As provided in the Loan
Agreement and subject to certain limitations therein set forth, the Notes may be
assigned, and the Notes are exchangeable for a like aggregate original principal
amount of Notes of different authorized denominations, as requested by the
Lender surrendering the same.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Security Trustee by manual signature, this Note shall not be
entitled to any benefit under the Loan Agreement or the Mortgage or be valid or
obligatory for any purpose.
-2-
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF
THE STATE OF NEW YORK.
AMERICA WEST AIRLINES, INC.
By: ____________________________________
Name:
Title:
SECURITY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Loan
Agreement and Mortgage.
XXXXX FARGO BANK NORTHWEST,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Security Trustee
By: ____________________________________
Name:
Title:
EXHIBIT C
FORM OF NOTICE OF BORROWING
NOTICE OF BORROWING
_____________, _____
General Electric Capital Corporation
as Administrative Agent
Attention: [_______________] [__________, 2[__]]
Ladies and Gentlemen:
We refer to the Loan Agreement [Engines] dated as of September 3, 2004,
among America West Airlines, Inc., General Electric Capital Corporation, as
Administrative Agent, Xxxxx Fargo Bank Northwest, National Association, as
Security Trustee, General Electric Capital Corporation, as Original Series A
Lender and as Original Series B Lender and the Lenders from time to time party
thereto (as amended or modified from time to time, the "Loan Agreement"; the
terms defined therein being used herein as therein defined). We hereby give you
notice requesting a Loan pursuant to Section 1.2(a) of the Loan Agreement, and
in that connection we set forth below the required information relating to such
Loan (the "Proposed Loan"):
(1) The Funding Date on which the Proposed Loan shall be made is
_______________.
(2) The aggregate principal amount of the Proposed Loan is
$_______________.
Very truly yours,
AMERICA WEST AIRLINES, INC.
By: ____________________________________
Name:
Title:
EXHIBIT D
[Insert Form of Opinion of Special Counsel to Borrower]
EXHIBIT E
[Insert Form of Opinion of Borrower's Legal Department]
EXHIBIT F
FORM OF TRANSFER SUPPLEMENT
Date __________, ____
Reference is made to the Agreement described in Item 2 of Annex I hereto
(as such Loan Agreement may hereafter be amended, supplemented or otherwise
modified from time to time, the "Loan Agreement"). Unless defined in Annex I
hereto, terms defined in the Loan Agreement are used herein as therein defined.
___________ (the "Assignor") and __________ (the "Assignee") hereby agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee without
recourse and without representation or warranty (other than as expressly
provided herein), and the Assignee hereby purchases and assumes from the
Assignor, that interest in and to all of the Assignor's rights and obligations
under the Loan Agreement as of the date hereof which represents the percentage
interest specified in Item 4 of Annex I hereto (the "Assigned Share") of all of
the outstanding rights and obligations under the Loan Agreement relating to the
Loans and Commitments listed in Item 4 of Annex I hereto. After giving effect to
such sale and assignment, the amount of the outstanding Loans owing to the
Assignee will be as set forth in Item 4 of Annex I hereto.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Agreement
or the other Transaction Documents or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Agreement or the
other Transaction Documents or any other instrument or document furnished
pursuant thereto; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any party to the
Transaction Documents or the performance or observance by any party to the
Transaction Documents of any of their respective obligations under the Loan
Agreement or the other Transaction Documents to which they are a party or any
other instrument or document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy of the Loan
Agreement and the other Transaction Documents, together with copies of the
financial statements referred to therein and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Transfer Supplement; (ii) agrees that it will,
independently and without reliance upon the Transaction Agents, the Assignor or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Agreement; (iii) confirms that it is an
Eligible Assignee under Section 9.8(c) of the Loan Agreement; (iv) appoints and
authorizes the Transaction Agents to take such action as an agent on its behalf
and to exercise such powers under the Loan Agreement and the other Transaction
Documents as are delegated to the Transaction Agents, as the case may be, by the
terms thereof,
together with such powers as are reasonably incidental thereto; (vi) agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Loan Agreement are required to be performed by it as a Lender;
(vii) makes the representations and warranties contained in Section 3.4 of the
Loan Agreement[; and (viii) attaches the forms described in Sections 5.3(c) and
9.8(c) of the Loan Agreement.](1)
4. Following the execution of this Transfer Supplement by the Assignor
and the Assignee, an executed original hereof (together with all attachments)
will be delivered to the Security Trustee. This Transfer Supplement shall be
effective, unless a later date is otherwise specified in Item 5 of Annex I
hereto (the "Settlement Date"), upon the date upon which each of the following
conditions shall have been satisfied: (i) each of the Assignor and Assignee
shall have executed a copy hereof and delivered the same to the other party,
(ii) the registration of the transfer on the Register as provided by Section
9.8(d) of the Loan Agreement and (iii) receipt by the Assignee of such other
documentation or fees specified on Item 9 of Annex I hereto.
5. Upon the delivery of a fully executed original hereof to the
Security Trustee, as of the Settlement Date of this Transfer Supplement, (i) the
Assignee shall be a party to the Loan Agreement and, to the extent provided in
this Transfer Supplement, have the rights and obligations of a Lender thereunder
and under the other Transaction Documents and (ii) the Assignor shall, to the
extent provided in this Transfer Supplement, relinquish its rights and be
released from its obligations under the Loan Agreement and the other Transaction
Documents.
6. It is agreed that the Assignee shall be entitled to all interest on
the Assigned Share of the Loans at the rates specified in Item 6 of Annex I
which are paid by the Borrower on and after the Settlement Date, such interest
to be paid by the Security Trustee directly to the Assignee. It is further
agreed that all payments of principal made on the Assigned Share of the Loans
which occur on and after the Settlement Date will be paid directly by the
Security Trustee to the Assignee. Upon the Settlement Date, the Assignee shall
pay to the Assignor an amount specified by the Assignor in writing which
represents the Assigned Share of the principal amount of the Loans pursuant to
the Loan Agreement which are outstanding on the Settlement Date, and which are
being assigned hereunder. The Assignor and the Assignee shall make all
appropriate adjustments in payments under the Loan Agreement for periods prior
to the Settlement Date directly between themselves.
7. The Borrower is an intended third party beneficiary of, and may
enforce, this Transfer Supplement.
8. THIS TRANSFER SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
-----------------
(1.) Include if the Assignee is organized under the laws of a jurisdiction
outside of the United States.
-2-
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Transfer Supplement, as of the
date first above written, such execution also being made on Annex I hereto.
[NAME OF ASSIGNOR],
as Assignor
By _____________________________________
Title:
[NAME OF ASSIGNEE],
as Assignee
By _____________________________________
Title:
Acknowledged and Agreed:
XXXXX FARGO BANK NORTHWEST, NATIONAL ASSOCIATION
as Security Trustee
By ____________________________________
Name:
Title:
-3-
ANNEX FOR TRANSFER SUPPLEMENT
ANNEX I
1. Borrower: America West Airlines, Inc.
2. Name and Date of Loan Agreement:
Loan Agreement [Engines], dated as of September 3, 2004, among America
West Airlines, Inc., as Borrower, General Electric Capital Corporation, as
Administrative Agent, Xxxxx Fargo Bank Northwest, National Association, as
Security Trustee, General Electric Capital Corporation, as Original Series
A and Series B Lender, and the Lenders from time to time party thereto.
3. Date of Assignment Agreement:
4. Amounts (as of date of Item 3 above):
Outstanding Principal Aggregate
of Loan Commitment
--------------------- ----------
a. Aggregate Amount
for all Lenders $__________ $__________
b. Assigned Share
c. Amount of
Assigned Share $__________ $__________
5. Settlement Date:
6. Rate of Interest to the As set forth in Section 2.1 of the Loan Agreement (unless
Assignee: otherwise agreed to by the Assignor and the Assignee)*
----------------
* The Borrower and the Security Trustee shall direct the entire amount of
the interest to the Assignee at the rate set forth in Section 2.1 of the
Loan Agreement, with the Assignor and Assignee effecting the agreed upon
sharing of the interest through payments by the Assignee to the Assignor.
7. Notice and Lending Office:
ASSIGNOR:
________________________
________________________
________________________
________________________
Attention:
Telephone:
Telecopier:
ASSIGNEE:
________________________
________________________
________________________
________________________
Attention:
Telephone:
Telecopier:
8. Payment Instructions:
ASSIGNOR:
________________________
________________________
________________________
________________________
Attention:
Reference:
ASSIGNEE:
________________________
________________________
________________________
________________________
Attention:
Reference:
-2-
9. Other Documents or Fees for Closing (if any):
Acknowledged and Agreed:
[NAME OF ASSIGNEE] [NAME OF ASSIGNOR]
By ______________________________ By _________________________
_________________________________ ____________________________
(Print Name and Title) (Print Name and Title)
-3-
EXHIBIT G
FORM OF CERTIFICATE RE NON-BANK STATUS
CERTIFICATE RE NON-BANK STATUS
Reference is hereby made to the Loan Agreement [Engines], dated as of
September 3, 2004, among America West Airlines, Inc., General Electric Capital
Corporation, as Administrative Agent, Xxxxx Fargo Bank Northwest, National
Association, as Security Trustee, General Electric Capital Corporation, as
Original Series A Lender, and General Electric Capital Corporation, as Original
Series B Lender and the Lenders from time to time party thereto (as amended or
modified from time to time, the "Loan Agreement"). Pursuant to the provisions of
Section 5.3(c) of the Loan Agreement, the undersigned hereby certifies that (i)
it is not a "bank" as such term is used in Section 881(c)(3)(A) of the Internal
Revenue Code of 1986, as amended (the "Code"), (ii) it is not a controlled
foreign corporation (within the meaning of Section 957(a) of the Code) related
(within the meaning of Section 864(d)(4) of the Code) to the Borrower, and (iii)
it is not a 10% shareholder (within the meaning of Section 871(h)(3)(B) of the
Code) of the Borrower.
[NAME OF LENDING INSTITUTION]
By ___________________________________
Title: _____________________________
Date: ______________________________
EXHIBIT H
[Insert Form of FAA Counsel's Opinion]
