1
Exhibit 4.8
[EXECUTION COPY]
--------------------------------------------------------------------------------
PASS THROUGH TRUST AGREEMENT
Dated as of June 25, 1997
between
CONTINENTAL AIRLINES, INC.
and
WILMINGTON TRUST COMPANY,
as Trustee
Continental Airlines Pass Through Trust, Series 1997-2D
7.522% Initial Pass Through Certificates, Series 1997-2D
7.522% Exchange Pass Through Certificates, Series 1997-2D
--------------------------------------------------------------------------------
2
Reconciliation and tie between Continental Airlines Pass Through Trust
Agreement, Series 1997-2D dated as of June 25, 1997, and the Trust Indenture Act
of 1939. This reconciliation does not constitute part of the Pass Through Trust
Agreement.
Trust Indenture Act Pass Through Trust
of 1939 Section Agreement Section
--------------------- ------------------
310(a)(1) 7.08
(a)(2) 7.08
312(a) 3.05; 8.01; 8.02
313(a) 7.06; 8.03
314(a) 8.04(a), (c)
& (d)
(a)(4) 8.04(e)
(c)(1) 1.02
(c)(2) 1.02
(d)(1) 7.13; 11.01
(d)(2) 7.13; 11.01
(d)(3) 2.01
(e) 1.02
315(b) 7.02
316(a)(last sentence) 1.04(c)
(a)(1)(A) 6.04
(a)(1)(B) 6.05
(b) 6.06
(c) 1.04(e)
317(a)(1) 6.03
(b) 7.13
318(a) 12.06
3
TABLE OF CONTENTS
Section Page
------- ----
ARTICLE I
DEFINITIONS
Section 1.01. Definitions........................................... 2
Section 1.02. Compliance Certificates and Opinions.................. 15
Section 1.03. Form of Documents Delivered to Trustee................ 16
Section 1.04. Directions of Certificateholders...................... 16
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
Section 2.01. Issuance of Certificates; Acquisition of
Equipment Notes....................................... 18
Section 2.02. Acceptance by Trustee................................. 22
Section 2.03. Limitation of Powers.................................. 22
ARTICLE III
THE CERTIFICATES
Section 3.01. Title, Form, Denomination and Execution of
Certificates.......................................... 23
Section 3.02. Restrictive Legends................................... 25
Section 3.03. Authentication of Certificates........................ 27
Section 3.04. Transfer and Exchange................................. 28
Section 3.05. Book-Entry Provisions for Restricted Global
Certificates and Regulation S Global
Certificates.......................................... 29
Section 3.06. Special Transfer Provisions........................... 31
Section 3.07. Mutilated, Destroyed, Lost or Stolen
Certificates.......................................... 35
Section 3.08. Persons Deemed Owners................................. 36
Section 3.09. Cancellation.......................................... 36
Section 3.10. Temporary Certificates................................ 36
Section 3.11. Limitation of Liability for Payments.................. 36
Section 3.12. ERISA Restrictive Legend.............................. 37
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
Section 4.01. Certificate Account and Special Payments Account...... 38
-i-
4
Section Page
------- ----
Section 4.02. Distributions from Certificate Account and
Special Payments Account.............................. 38
Section 4.03. Statements to Certificateholders...................... 40
Section 4.04. Investment of Special Payment Moneys.................. 41
ARTICLE V
THE COMPANY
Section 5.01. Maintenance of Corporate Existence.................... 42
Section 5.02. Consolidation, Merger, etc............................ 42
ARTICLE VI
DEFAULT
Section 6.01. Events of Default..................................... 43
Section 6.02. Incidents of Sale of Equipment Notes.................. 45
Section 6.03. Judicial Proceedings Instituted by Trustee;
Trustee May Bring Suit................................ 46
Section 6.04. Control by Certificateholders......................... 46
Section 6.05. Waiver of Past Defaults............................... 47
Section 6.06. Right of Certificateholders to Receive Payments
Not to Be Impaired.................................... 48
Section 6.07. Certificateholders May Not Bring Suit Except
Under Certain Conditions.............................. 48
Section 6.08. Remedies Cumulative................................... 49
ARTICLE VII
THE TRUSTEE
Section 7.01. Certain Duties and Responsibilities................... 49
Section 7.02. Notice of Defaults.................................... 50
Section 7.03. Certain Rights of Trustee............................. 50
Section 7.04. Not Responsible for Recitals or Issuance of
Certificates.......................................... 52
Section 7.05. May Hold Certificates................................. 52
Section 7.06. Money Held in Trust................................... 52
Section 7.07. Compensation and Reimbursement........................ 52
Section 7.08. Corporate Trustee Required; Eligibility............... 53
Section 7.09. Resignation and Removal; Appointment of
Successor............................................. 54
Section 7.10. Acceptance of Appointment by Successor................ 56
Section 7.11. Merger, Conversion, Consolidation or Succession
to Business........................................... 56
Section 7.12. Maintenance of Agencies............................... 57
Section 7.13. Money for Certificate Payments to Be Held in
Trust................................................. 58
-ii-
5
Section Page
------- ----
Section 7.14. Registration of Equipment Notes in Name of
Subordination Agent................................... 59
Section 7.15. Representations and Warranties of Trustee............. 59
Section 7.16. Withholding Taxes, Information Reporting.............. 60
Section 7.17. Trustee's Liens....................................... 61
Section 7.18. Preferential Collection of Claims..................... 61
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY
TRUSTEE
Section 8.01. The Company to Furnish Trustee with Names and
Addresses of Certificateholders....................... 61
Section 8.02. Preservation of Information; Communications to
Certificateholders.................................... 62
Section 8.03. Reports by Trustee.................................... 62
Section 8.04. Reports by the Company................................ 62
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
Section 9.01. Supplemental Agreements Without Consent of
Certificateholders.................................... 63
Section 9.02. Supplemental Agreements with Consent of
Certificateholders.................................... 65
Section 9.03. Documents Affecting Immunity or Indemnity............. 67
Section 9.04. Execution of Supplemental Agreements.................. 67
Section 9.05. Effect of Supplemental Agreements..................... 67
Section 9.06. Conformity with Trust Indenture Act................... 67
Section 9.07. Reference in Certificates to Supplemental
Agreements............................................ 67
ARTICLE X
AMENDMENTS TO INDENTURES AND FINANCING
DOCUMENTS
Section 10.01. Amendments and Supplements to Indentures and
Financing Documents................................... 68
ARTICLE XI
TERMINATION OF TRUST
Section 11.01. Termination of the Trust.............................. 69
-iii-
6
Section Page
------- ----
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Limitation on Rights of Certificateholders............ 70
Section 12.02. Certificates Nonassessable and Fully Paid............. 70
Section 12.03. Notices............................................... 71
Section 12.04. Governing Law......................................... 72
Section 12.05. Severability of Provisions............................ 72
Section 12.06. Trust Indenture Act Controls.......................... 73
Section 12.07. Effect of Headings and Table of Contents.............. 73
Section 12.08. Successors and Assigns................................ 73
Section 12.09. Benefits of Agreement................................. 73
Section 12.10. Legal Holidays........................................ 73
Section 12.11. Counterparts.......................................... 73
Section 12.12. Intention of Parties.................................. 73
Exhibit A- Form of Certificate
Exhibit B- Form of Certificate to Request Removal of
Restricted Legend
Schedule I- Aircraft
-iv-
7
PASS THROUGH TRUST AGREEMENT
This PASS THROUGH TRUST AGREEMENT, dated as of June 25, 1997 (the
"Agreement"), between CONTINENTAL AIRLINES, INC., a Delaware corporation, and
WILMINGTON TRUST COMPANY, as Trustee, is made with respect to the formation of
Continental Airlines Pass Through Trust, Series 1997-2D and the issuance of
7.522% Continental Airlines Pass Through Trust, Series 1997-2D Pass Through
Certificates representing fractional undivided interests in the Trust.
WITNESSETH:
WHEREAS, the Company wishes to purchase the six Boeing 737-3TO
aircraft and four XxXxxxxxx Xxxxxxx DC-9-82 aircraft listed in Schedule I hereto
(the "Aircraft") and to finance the purchase price of each such Aircraft through
the issuance pursuant to an Indenture, on a recourse basis, of four series of
Equipment Notes relating to such Aircraft;
WHEREAS, the Trustee, upon execution and delivery of this Agreement,
hereby declares the creation of the Trust for the benefit of the
Certificateholders, and the initial Certificateholders, as the grantors of the
Trust, by their respective acceptances of the Certificates, join in the creation
of this Trust with the Trustee;
WHEREAS, all Certificates to be issued by the Trust will evidence
fractional undivided interests in the Trust and will convey no rights, benefits
or interests in respect of any property other than the Trust Property;
WHEREAS, pursuant to the terms and conditions of this Agreement and
each of the Financing Agreements to be entered into by the Trustee
simultaneously with the execution and delivery of this Agreement, the Trustee on
behalf of the Trust shall purchase one or more issues of Equipment Notes having
the same interest rate as, and final maturity dates not later than the final
Regular Distribution Date of, the Certificates issued hereunder and, subject to
the Intercreditor Agreement, shall hold such Equipment Notes in trust for the
benefit of the Certificateholders;
WHEREAS, to facilitate the sale of Equipment Notes to, and the
purchase of Equipment Notes by, the Trustee on behalf of the Trust, the Company
has duly authorized the execution and delivery of this Agreement as the
"issuer", as such term is defined in and solely for purposes of the Securities
Act, of the Certificates to be issued pursuant hereto and as the "obligor",
8
-2-
as such term is defined in and solely for purposes of the Trust Indenture Act of
1939, as amended, with respect to all such Certificates and is undertaking to
perform certain administrative and ministerial duties hereunder and is also
undertaking to pay the ongoing fees and expenses of the Trustee;
WHEREAS, all of the conditions and requirements necessary to make
this Agreement, when duly executed and delivered, a valid, binding and legal
instrument, enforceable in accordance with its terms and for the purposes herein
expressed, have been done, performed and fulfilled, and the execution and
delivery of this Agreement in the form and with the terms hereof have been in
all respects duly authorized; and
WHEREAS, upon issuance of the Exchange Certificates, if any, or the
effectiveness of the Shelf Registration Statement, this Agreement, as amended or
supplemented from time to time, will be subject to the provisions of the Trust
Indenture Act of 1939, and shall, to the extent applicable, be governed by such
provisions;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. For all purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(1) the terms used in this Agreement, including in the recitals to
this Agreement, that are defined in this Article have the meanings
assigned to them in this Article, and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, or by the rules
promulgated under the Trust Indenture Act, have the meanings assigned to
them therein;
(3) all references in this Agreement to designated "Articles",
"Sections", "Subsections" and other subdivisions are to the designated
Articles, Sections, Subsections and other subdivisions of this Agreement;
(4) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a
9
-3-
whole and not to any particular Article, Section, Subsection or other
subdivision; and
(5) unless the context otherwise requires, whenever the words
"including", "include" or "includes" are used herein, it shall be deemed
to be followed by the phrase "without limitation".
Affiliate: Means, with respect to any specified Person, any other
Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such Person, provided, however, that
neither America West Airlines, Inc. nor any of its subsidiaries shall be
deemed to be an "Affiliate" of the Company for purposes of this Agreement.
For the purposes of this definition, "control" means the power, directly
or indirectly, to direct the management and policies of such Person,
whether through the ownership of voting securities or by contract or
otherwise, and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
Agent Members: Has the meaning specified in Section 3.05.
Agreement: Has the meaning specified in the initial paragraph
hereto.
Aircraft: Has the meaning specified in the first recital to this
Agreement.
Authorized Agent: Means any Paying Agent or Registrar for the
Certificates.
Avoidable Tax: Means a state or local tax (i) upon (w) the Trust,
(x) the Trust Property, (y) Certificateholders or (z) the Trustee for
which the Trustee is entitled to seek reimbursement from the Trust
Property, and (ii) which would be avoided if the Trustee were located in
another state, or jurisdiction within a state, within the United States. A
tax shall not be an Avoidable Tax if the Company shall agree to pay, and
shall pay, such tax.
Boeing: Means The Boeing Company.
Business Day: Means any day other than a Saturday, a Sunday or a day
on which commercial banks are required or authorized to close in Houston,
Texas, New York, New York, Salt Lake City, Utah or, so long as any
Certificate is outstanding, the city and state in which the Trustee or any
Loan Trustee maintains its Corporate Trust Office or receives and
disburses funds.
10
-4-
Cedel: Means Cedel Bank societe anonyme.
Certificate: Means any one of the Initial Certificates or
Exchange Certificates and any such Certificates issued in exchange
therefor or replacement thereof pursuant to this Agreement.
Certificate Account: Means the account or accounts created and
maintained pursuant to Section 4.01(a).
Certificateholder or Holder: Means the Person in whose name a
Certificate is registered in the Register.
Company: Means Continental Airlines, Inc., a Delaware corporation,
or its successor in interest pursuant to Section 5.02, or (only in the
context of provisions hereof, if any, where such reference is required for
purposes of compliance with the Trust Indenture Act) any other "obligor"
(within the meaning of the Trust Indenture Act) with respect to the
Certificates.
Controlling Party: Has the meaning specified in the
Intercreditor Agreement.
Corporate Trust Office: With respect to the Trustee, the Second
Mortgagee or any Loan Trustee, means the office of such trustee in the
city at which at any particular time its corporate trust business shall be
principally administered.
Cut-off Date: Means August 31, 1997.
Definitive Certificates: Has the meaning specified in Section
3.01(e).
Direction: Has the meaning specified in Section 1.04(a).
Distribution Date: Means any Regular Distribution Date or
Special Distribution Date as the context requires.
DTC: Means The Depository Trust Company, its nominees and their
respective successors.
Equipment Notes: Means the equipment notes issued under the
Indentures.
ERISA: Means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor federal statute.
11
-5-
ERISA Legend: Has the meaning specified in Section 3.12.
Escrow Account: Has the meaning specified in Section 2.01(b).
Escrowed Funds: Has the meaning specified in Section 2.01(b).
Euroclear: Means the Euroclear System.
Event of Default: Means an Indenture Default under any Indenture
pursuant to which Equipment Notes held by the Trust were issued.
Exchange Certificates: Means the pass through certificates
substantially in the form of Exhibit A hereto issued in exchange for the
Initial Certificates pursuant to the Registration Rights Agreement and
authenticated hereunder.
Exchange Offer: Means the exchange offer which may be made
pursuant to the Registration Rights Agreement to exchange Initial
Certificates for Exchange Certificates.
Exchange Offer Registration Statement: Means the registration
statement that, pursuant to the Registration Rights Agreement, is filed by
the Company with the SEC with respect to the exchange of Initial
Certificates for Exchange Certificates.
Final Maturity Date: Means June 30, 2001.
Financing Agreements: Means each of the ten separate Participation
Agreements relating to the Aircraft each dated the date hereof, among the
Company, the Pass Through Trustee, the Other Trustees, the relevant Loan
Trustee, the Second Mortgagee and the Subordination Agent providing for,
among other things, the purchase of Equipment Notes by the Trustee on
behalf of the Trust, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
Financing Documents: With respect to any Equipment Note, means
the related Indenture, the Second Mortgage and the related Financing
Agreement.
Fractional Undivided Interest: Means the fractional undivided
interest in the Trust that is evidenced by a Certificate.
12
-6-
Global Certificates: Has the meaning specified in Section 3.01(d).
Global Exchange Certificate: Has the meaning specified in Section
3.01(f).
Indenture: Means each of the ten separate trust indentures and
mortgages relating to the Aircraft, in each case as the same may be
amended, supplemented or otherwise modified from time to time in
accordance with its terms.
Indenture Default: With respect to any Indenture, means any
Event of Default (as such term is defined in such Indenture).
Initial Certificates: Means the certificates issued and
authenticated hereunder substantially in the form of Exhibit A hereto
other than the Exchange Certificates.
Initial Purchasers: Means, collectively, Credit Suisse First
Boston Corporation and Xxxxxx Xxxxxxx & Co. Incorporated.
Institutional Accredited Investor: Means an institutional investor
that is an "accredited investor" within the meaning set forth in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act.
Intercreditor Agreement: Means the Intercreditor Agreement dated as
of June 25, 1997 among the Trustee, the Other Trustees, the Liquidity
Provider, the liquidity providers relating to the Certificates issued
under (and as defined in) each of the Other Pass Through Trust Agreements,
and Wilmington Trust Company, as Subordination Agent and as trustee
thereunder, as amended, supplemented or otherwise modified from time to
time in accordance with its terms.
Issuance Date: Means the date of the issuance of the Initial
Certificates.
Liquidity Facility: Means, initially, the Revolving Credit Agreement
dated as of June 25, 1997 relating to the Certificates, between the
Liquidity Provider and the Subordination Agent, as agent and trustee for
the Trustee, and, from and after the replacement of such Agreement
pursuant to the Intercreditor Agreement, the replacement liquidity
facility (or facilities) therefor, in each case as amended, supplemented
or otherwise modified from time to time in accordance with its terms.
13
-7-
Liquidity Provider: Means, initially, Kredietbank N.V., acting
through its New York Branch, and any replacement or successor therefor
appointed in accordance with the Intercreditor Agreement.
Loan Trustee: With respect to any Equipment Note or the Indenture
applicable thereto, means the bank or trust company designated as
mortgagee under such Indenture, together with any successor to such
mortgagee appointed pursuant thereto.
XxXxxxxxx Xxxxxxx: Means the XxXxxxxxx Xxxxxxx Corporation.
Non-U.S. Person: Means a Person that is not a "U.S. person", as
defined in Regulation S.
Officer's Certificate: Means a certificate signed, (a) in the case
of the Company, by (i) the Chairman or Vice Chairman of the Board of
Directors, the President, any Executive Vice President, any Senior Vice
President or the Treasurer of the Company, signing alone, or (ii) any Vice
President of the Company signing together with the Secretary, the
Assistant Secretary, the Treasurer or any Assistant Treasurer of the
Company, (b) in the case of a Loan Trustee, a Responsible Officer of such
Loan Trustee or (c) in the case of a Second Mortgagee, a Responsible
Officer of such Second Mortgagee.
Opinion of Counsel: Means a written opinion of legal counsel who (a)
in the case of counsel for the Company may be (i) a senior attorney of the
Company one of whose principal duties is furnishing advice as to legal
matters, (ii) Xxxxxx Xxxxxxx & Xxxx LLP, or (iii) such other counsel
designated by the Company and reasonably acceptable to the Trustee and (b)
in the case of counsel for any Loan Trustee or Second Mortgagee may be
such counsel as may be designated by any of them whether or not such
counsel is an employee of any of them, and who shall be reasonably
acceptable to the Trustee.
Other Pass Through Trust Agreements: Means each of the three other
Continental Airlines 1997-2 Pass Through Trust Agreements relating to
Continental Airlines Pass Through Trust, Series 0000-0X, Xxxxxxxxxxx
Xxxxxxxx Xxxx Through Trust, Series 1997-2B and Continental Airlines Pass
Through Trust, Series 1997-2C, dated the date hereof.
14
-8-
Other Trustees: Means the trustees under the Other Pass Through
Trust Agreements, and any successor or other trustee appointed as
provided therein.
Outstanding: When used with respect to Certificates, means, as
of the date of determination, all Certificates theretofore
authenticated and delivered under this Agreement, except:
(i) Certificates theretofore canceled by the Registrar or
delivered to the Trustee or the Registrar for cancellation;
(ii) Certificates for which money in the full amount required
to make the final distribution with respect to such Certificates
pursuant to Section 11.01 hereof has been theretofore deposited with
the Trustee in trust for the Holders of such Certificates as
provided in Section 4.01 pending distribution of such money to such
Certificateholders pursuant to payment of such final distribution;
and
(iii) Certificates in exchange for or in lieu of which other
Certificates have been authenticated and delivered pursuant to this
Agreement.
Paying Agent: Means the paying agent maintained and appointed for
the Certificates pursuant to Section 7.12.
Permitted Investments: Means obligations of the United States of
America or agencies or instrumentalities thereof for the payment of which
the full faith and credit of the United States of America is pledged,
maturing in not more than 60 days after the date of acquisition thereof or
such lesser time as is required for the distribution of any Special
Payments on a Special Distribution Date.
Person: Means any person, including any individual, corporation,
limited liability company, partnership, joint venture, association,
joint-stock company, trust, trustee, unincorporated organization, or
government or any agency or political subdivision thereof.
Plan Transferee: Means any Plan or any entity that is using the
assets of any Plan to purchase or hold its interest in a Certificate. For
purposes of this definition, a "Plan" means any employee benefit plan
subject to ERISA as well as any plan that is not subject to ERISA but
which is subject to Section 4975 of the Internal Revenue Code of 1986, as
amended.
00
-0-
Xxxx Xxxxxxx: Means, as of any date, (i) the original aggregate face
amount of the Certificates less (ii) the aggregate amount of all payments
made in respect of such Certificates other than payments made in respect
of interest or premium thereon or reimbursement of any costs or expenses
incurred in connection therewith. The Pool Balance as of any Distribution
Date shall be computed after giving effect to the payment of principal, if
any, on the Equipment Notes or other Trust Property held in the Trust and
the distribution thereof to be made on such Distribution Date.
Pool Factor: Means, as of any date, the quotient (rounded to the
seventh decimal place) computed by dividing (i) the Pool Balance as at
such date by (ii) the original aggregate face amount of the Certificates.
The Pool Factor as of any Distribution Date shall be computed after giving
effect to the payment of principal, if any, on the Equipment Notes or
other Trust Property held in the Trust and the distribution thereof to be
made on such Distribution Date.
Postponed Notes: Means any Equipment Notes to be held in the Trust
as to which a Postponement Notice shall have been delivered pursuant to
Section 2.01(b).
Postponement Notice: Means an Officer's Certificate of the Company
(1) requesting that the Trustee temporarily postpone the purchase pursuant
to one or more of the Financing Agreements of certain of the Equipment
Notes to a date which is later than the Issuance Date, (2) identifying the
amount of the purchase price of each such Equipment Note and the aggregate
purchase price for all such Equipment Notes and (3) with respect to each
such Equipment Note, either (a) setting or resetting a new Transfer Date
for payment by the Trustee of such purchase price and issuance of the
related Equipment Note (subject to subsequent change from time to time in
accordance with the relevant Financing Agreement), or (b) indicating that
such new Transfer Date (which shall be on or prior to the Cut-off Date)
will be set by subsequent written notice not less than one Business Day
prior to such new Transfer Date (subject to subsequent change from time to
time in accordance with the relevant Financing Agreement).
PTC Event of Default: Means any failure to pay within 10 Business
Days of the due date thereof: (i) the outstanding Pool Balance on the
Final Maturity Date or (ii) interest due on the Certificates on any
Distribution Date (unless the Subordination Agent shall have made an
Interest Drawing or Drawings (as defined in the Intercreditor Agreement),
or a withdrawal or withdrawals
16
-10-
pursuant to section 3.6(f) of the Intercreditor Agreement, with respect
thereto in an aggregate amount sufficient to pay such interest and shall
have distributed such amount to the Trustee).
Purchase Agreement: Means the Purchase Agreement dated June 17, 1997
among the Initial Purchasers and the Company, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with
its terms.
QIB: Means a qualified institutional buyer as defined in Rule 144A.
Record Date: Means (i) for Scheduled Payments to be distributed on
any Regular Distribution Date, other than the final distribution, the 15th
day (whether or not a Business Day) preceding such Regular Distribution
Date, and (ii) for Special Payments to be distributed on any Special
Distribution Date, other than the final distribution, the 15th day
(whether or not a Business Day) preceding such Special Distribution Date.
Register and Registrar: Mean the register maintained and the
registrar appointed pursuant to Sections 3.04 and 7.12.
Registration Event: Means the declaration of the effectiveness
by the SEC of the Exchange Offer Registration Statement or the Shelf
Registration Statement.
Registration Rights Agreement: Means the Exchange and Registration
Rights Agreement dated as of June 25, 1997, among the Initial Purchasers,
the Trustee, the Other Trustees and the Company, as amended, supplemented
or otherwise modified from time to time in accordance with its terms.
Regular Distribution Date: With respect to distributions of
Scheduled Payments in respect of the Certificates, means each date
designated as a Regular Distribution Date in the Certificates issued
pursuant to this Agreement, until payment of all the Scheduled Payments to
be made under the Equipment Notes held in the Trust have been made;
provided, however, that, if any such day shall not be a Business Day, the
related distribution shall be made on the next succeeding Business Day
without additional interest.
Regulation S: Means Regulation S under the Securities Act or any
successor regulation thereto.
17
-11-
Regulation S Definitive Certificates: Has the meaning specified
in Section 3.01(e).
Regulation S Global Certificates: Has the meaning specified in
Section 3.01(d).
Responsible Officer: With respect to the Trustee, the Second
Mortgagee and any Loan Trustee, means any officer in the Corporate Trust
Office of the Trustee, Second Mortgagee or Loan Trustee or any other
officer customarily performing functions similar to those performed by the
persons who at the time shall be such officers, respectively, or to whom
any corporate trust matter is referred because of his knowledge of and
familiarity with a particular subject.
Restricted Definitive Certificates: Has the meaning specified in
Section 3.01(e).
Restricted Global Certificate: Has the meaning specified in
Section 3.01(c).
Restricted Legend: Has the meaning specified in Section 3.02.
Restricted Period: Has the meaning specified in Section 3.01(d).
Rule 144A: Means Rule 144A under the Securities Act and any
successor rule thereto.
Scheduled Payment: With respect to any Equipment Note, means (i) any
payment of principal or interest on such Equipment Note (other than any
such payment which is not in fact received by the Subordination Agent
within five days of the date on which such payment is scheduled to be
made) due from the obligor thereon or (ii) any payment of interest on the
Certificates with funds drawn under the Liquidity Facility, which payment
represents the installment of principal at the stated maturity of such
installment of principal on such Equipment Note, the payment of regularly
scheduled interest accrued on the unpaid principal amount of such
Equipment Note, or both; provided that any payment of principal, premium,
if any, or interest resulting from the redemption or purchase of any
Equipment Note shall not constitute a Scheduled Payment.
SEC: Means the Securities and Exchange Commission, as from time to
time constituted or created under the United States Securities Exchange
Act of 1934, as amended, or, if at any time after the execution of this
instrument such Commission is not existing and performing the duties now
18
-12-
assigned to it under the Trust Indenture Act, then the body performing
such duties on such date.
Second Mortgage: Means the Second Trust Indenture and Mortgage
dated as of the date hereof between the Company and the Loan Trustees.
Second Mortgagee: Means the bank or trust company designated as
second mortgagee under the Second Mortgage together with any successor to
such second mortgagee appointed pursuant thereto.
Securities Act: Means the United States Securities Act of 1933,
as amended from time to time, or any successor thereto.
Shelf Registration Statement: Means the shelf registration statement
which may be required to be filed by the Company with the SEC pursuant to
any Registration Rights Agreement, other than an Exchange Offer
Registration Statement.
Special Distribution Date: Means each date on which a Special
Payment is to be distributed as specified in this Agreement; provided,
however, that, if any such day shall not be a Business Day, the related
distribution shall be made on the next succeeding Business Day without
additional interest.
Special Payment: Means (i) any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note, the
Collateral (as defined in each Indenture) or the Collateral (as defined in
the Second Mortgage), (ii) the amounts required to be distributed pursuant
to the last paragraph of Section 2.01(b) or (iii) the amounts required to
be distributed pursuant to the penultimate paragraph of Section 2.01(b).
Special Payments Account: Means the account or accounts created
and maintained pursuant to Section 4.01(b).
Specified Investments: Means, with respect to investments to be made
with Escrowed Funds pursuant to Section 2.01(b) hereof, (i) obligations
of, or guaranteed by, the United States Government or agencies thereof,
(ii) open market commercial paper of any corporation incorporated under
the laws of the United States of America or any State thereof rated at
least P-2 or its equivalent by Xxxxx'x Investors Service, Inc. or at least
A-2 or its equivalent by Standard & Poor's Ratings Group, (iii)
certificates of
19
-13-
deposit issued by commercial banks organized under the laws of the United
States or of any political subdivision thereof having a combined capital
and surplus in excess of $100,000,000, which banks or their holding
companies have a short-term deposit rating of Pl by Xxxxx'x Investors
Service, Inc. or its equivalent by Standard & Poor's Ratings Group;
provided, however, that the aggregate amount at any one time so invested
in certificates of deposit issued by any one bank shall not exceed 5% of
such bank's capital and surplus, (iv) U.S. dollar denominated offshore
certificates of deposit issued by, or offshore time deposits with, any
commercial bank described in clause (iii) above or any subsidiary thereof
and (v) repurchase agreements with any financial institution having
combined capital and surplus of at least $100,000,000 with respect to any
of the obligations described in clauses (i) through (iv) above as
collateral; provided further that if all of the above investments are
unavailable, all amounts to be invested may be used to purchase Federal
Funds from an entity described in clause (iii) above.
Subordination Agent: Has the meaning specified in the Intercreditor
Agreement.
Transfer Date: Has the meaning assigned to the term "Closing Date"
in each Financing Agreement (as such "Closing Date" may be changed from
time to time in accordance with the terms of such Financing Agreement).
Triggering Event: Has the meaning assigned to such term in the
Intercreditor Agreement.
Trust: Means the trust created by this Agreement, the estate of
which consists of the Trust Property.
Trust Indenture Act: Means the United States Trust Indenture Act
of 1939, as amended from time to time, or any successor thereto.
Trust Property: Means (i) subject to the Intercreditor Agreement,
the Equipment Notes held as the property of the Trust and all monies at
any time paid thereon and all monies due and to become due thereunder,
(ii) funds from time to time deposited in the Escrow Account, the
Certificate Account and the Special Payments Account and, subject to the
Intercreditor Agreement, any proceeds from the sale by the Trustee
pursuant to Article VI hereof of any such Equipment Note and (iii) all
rights of the Trust and the Trustee, on behalf of the Trust, under the
Intercreditor Agreement and the Liquidity Facility, including, without
limitation, all
20
-14-
rights to receive certain payments thereunder, and all monies paid to the
Trustee on behalf of the Trust pursuant to the Intercreditor Agreement or
the Liquidity Facility.
Trustee: Means Wilmington Trust Company, or its successor in
interest, and any successor or other trustee appointed as provided herein.
Trustee's Lien: Has the meaning specified in Section 7.17.
Section 1.02. Compliance Certificates and Opinions. Upon any
application or request (except with respect to matters set forth in Article II)
by the Company, any Loan Trustee or the Second Mortgagee to the Trustee to take
any action under any provision of this Agreement, the Company, such Loan Trustee
or such Second Mortgagee, as the case may be, shall furnish to the Trustee (i)
an Officer's Certificate stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Agreement relating to such particular application or request,
no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement (other than a certificate
provided pursuant to Section 8.04(e)) shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions in this
Agreement relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
21
-15-
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.03. Form of Documents Delivered to Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters and any such Person may certify or give an opinion as to
such matters in one or several documents.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement or, in respect of the Certificates, this
Agreement, they may, but need not, be consolidated and form one instrument.
Section 1.04. Directions of Certificateholders. (a) Any direction,
consent, request, demand, authorization, notice, waiver or other action provided
by this Agreement to be given or taken by Certificateholders (a "Direction") may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Certificateholders in person or by an agent or proxy duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required pursuant to this
Agreement, to the Company, any Loan Trustee or the Second Mortgagee. Proof of
execution of any such instrument or of a writing appointing any such agent or
proxy shall be sufficient for any purpose of this Agreement and conclusive in
favor of the Trustee, the Company, any Loan Trustee and the Second Mortgagee, if
made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the certificate of any notary public or
other officer of any jurisdiction authorized to take acknowledgments of deeds or
administer oaths that the Person executing such instrument acknowledged to him
the execution thereof, or by an affidavit of a witness to such execution sworn
to before any such notary or such other officer and where such execution is by
an officer of a corporation or association or a member of a partnership, on
behalf of such corporation, association or partnership, such certificate or
affidavit shall also constitute sufficient proof
22
-16-
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) In determining whether the Certificateholders of the requisite
Fractional Undivided Interests of Certificates Outstanding have given any
Direction under this Agreement, Certificates owned by the Company or any
Affiliate thereof shall be disregarded and deemed not to be Outstanding for
purposes of any such determination. In determining whether the Trustee shall be
protected in relying upon any such Direction, only Certificates which the
Trustee knows to be so owned shall be so disregarded. Notwithstanding the
foregoing, (i) if any such Person owns 100% of the Certificates Outstanding,
such Certificates shall not be so disregarded, and (ii) if any amount of
Certificates so owned by any such Person have been pledged in good faith, such
Certificates shall not be disregarded if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not the Company or any Affiliate thereof.
(d) For all purposes of this Agreement, all Initial Certificates and
all Exchange Certificates shall vote and take all other actions of
Certificateholders together as one series of Certificates.
(e) The Company may at its option, by delivery of an Officer's
Certificate to the Trustee, set a record date to determine the
Certificateholders entitled to give any Direction. Notwithstanding Section
316(c) of the Trust Indenture Act, such record date shall be the record date
specified in such Officer's Certificate, which shall be a date not more than 30
days prior to the first solicitation of Certificateholders in connection
therewith. If such a record date is fixed, such Direction may be given before or
after such record date, but only the Certificateholders of record at the close
of business on such record date shall be deemed to be Certificateholders for the
purposes of determining whether Certificateholders of the requisite proportion
of Outstanding Certificates have authorized or agreed or consented to such
Direction, and for that purpose the Outstanding Certificates shall be computed
as of such record date; provided that no such Direction by the
Certificateholders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Agreement not later than one
year after such record date.
(f) Any Direction by the Holder of any Certificate shall bind the
Holder of every Certificate issued upon the transfer thereof or in exchange
therefor or in lieu thereof,
23
-17-
whether or not notation of such Direction is made upon such Certificate.
(g) Except as otherwise provided in Section 1.04(c), Certificates
owned by or pledged to any Person shall have an equal and proportionate benefit
under the provisions of this Agreement, without preference, priority, or
distinction as among all of the Certificates.
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
Section 2.01. Issuance of Certificates; Acquisition of Equipment
Notes. (a) The Trustee is hereby directed (i) to execute and deliver the
Intercreditor Agreement, the Registration Rights Agreement and each of the
Financing Agreements on or prior to the Issuance Date, each in the form
delivered to the Trustee by the Company, and (ii) subject to the respective
terms thereof, to perform its obligations thereunder. Upon request of the
Company and the satisfaction or waiver of the closing conditions specified in
the Purchase Agreement, the Trustee shall execute, deliver, authenticate, issue
and sell Initial Certificates in authorized denominations equalling in the
aggregate the amount set forth, with respect to the Certificates, in Schedule II
to the Purchase Agreement evidencing the entire ownership interest in the Trust,
which amount equals the maximum aggregate principal amount of Equipment Notes
which may be purchased by the Trustee pursuant to the Financing Agreements. On
the Issuance Date, the Trustee shall purchase, pursuant to the terms and
conditions of the Financing Agreements, the Equipment Notes (other than the
Postponed Notes) contemplated to be purchased by the Trustee under the Financing
Agreements at a purchase price equal to the consideration so received for the
Certificates (less the aggregate amount of any Escrowed Funds). Except as
provided in Sections 3.04, 3.05, 3.06, 3.07 and 3.10 hereof, the Trustee shall
not execute, authenticate or deliver Certificates in excess of the aggregate
amount specified in this paragraph.
(b) On or prior to the Issuance Date, the Company may deliver to the
Trustee a Postponement Notice relating to one or more Postponed Notes. The
Trustee shall postpone the purchase of the Postponed Notes from the
consideration received from the sale of Certificates and shall promptly deposit
funds in an amount equal to the purchase price of such Postponed Notes (the
"Escrowed Funds") into an escrow account (the "Escrow Account") with the Trustee
to be maintained as a part of the Trust. The portion of Escrowed Funds so
deposited with respect to any particular Postponed Notes shall be invested by
the Trustee at
24
-18-
the direction and risk of the Company in Specified Investments (i) maturing no
later than any scheduled Transfer Date relating to such Postponed Notes or (ii)
if no such Transfer Date has been scheduled, maturing on the next Business Day,
or (iii) if the Company has given notice to the Trustee that such Postponed
Notes will not be issued, maturing on the next applicable Special Distribution
Date, if such investments are reasonably available for purchase. The Trustee
shall make withdrawals from the Escrow Account only as provided in this
Agreement. Upon request of the Company on one or more occasions and the
satisfaction or waiver of the closing conditions specified in the applicable
Financing Agreement on or prior to the Cut-off Date, the Trustee shall purchase
the applicable Postponed Notes with Escrowed Funds withdrawn from the Escrow
Account. The purchase price shall equal the principal amount of such Postponed
Notes.
The Trustee shall hold all Specified Investments until the maturity
thereof and will not sell or otherwise transfer Specified Investments. If
Specified Investments held in an Escrow Account mature prior to any applicable
Transfer Date, any proceeds received on the maturity of such Specified
Investments (including any earnings thereon) shall be reinvested by the Trustee
at the direction and risk of the Company in Specified Investments maturing as
provided in the preceding paragraph. The Company shall pay to the Trustee for
deposit to the Escrow Account an amount equal to any losses on such Specified
Investments as incurred.
On the initial Regular Distribution Date, the Company will pay (in
immediately available funds) to the Trustee an amount equal to (i) the sum of
(A) the interest that would have accrued, at a rate equal to the interest rate
applicable to the Certificates, on any Postponed Notes purchased on or prior to
the Cut-Off Date if such Postponed Notes had been issued on the Issuance Date,
from and including the Issuance Date to but excluding the date of such purchase,
and (B) the interest that would have accrued, at a rate equal to the interest
rate applicable to the Certificates, on any Postponed Notes not purchased on or
prior to the Cut-Off Date (other than any Postponed Notes for which a Special
Distribution Date specified in either of the two immediately succeeding
paragraphs has occurred on or prior to the initial Regular Distribution Date) if
such Postponed Notes had been issued on the Issuance Date, from and including
the Issuance Date to but excluding the initial Regular Distribution Date, minus
(ii) the earnings on Specified Investments received (with respect to the portion
of the Escrow Funds deposited with respect to the Postponed Notes described in
sub-clauses (A) and (B) of clause (i) of this paragraph) by the Trustee from and
including the Issuance Date to but excluding the initial Regular Distribution
Date.
25
-19-
If the Company notifies the Trustee prior to the Cut-off Date that
any Postponed Notes will not be issued on or prior to the Cut-off Date for any
reason, on the next Special Distribution Date established pursuant to Section
4.02(c) for the distribution to the Certificateholders of Escrowed Funds with
respect to the Postponed Notes designated in such notice (i) the Company shall
pay to the Trustee for deposit in the Special Payments Account, in immediately
available funds, an amount equal to (A) the interest that would have accrued, on
the Postponed Notes designated in such notice, at a rate equal to the interest
rate applicable to the Certificates from and including the Issuance Date (if
such Special Distribution Date shall occur on or prior to the initial Regular
Distribution Date) or the initial Regular Distribution Date (if such Special
Distribution Date occurs after the initial Regular Distribution Date) to but
excluding such Special Distribution Date, minus (B) the earnings on Specified
Investments received (with respect to the portion of the Escrowed Funds
deposited with respect to the Postponed Notes designated in such notice) by the
Trustee from and including the Issuance Date (if such Special Distribution Date
shall occur on or prior to the initial Regular Distribution Date) or the initial
Regular Distribution Date (if such Special Distribution Date occurs after the
initial Regular Distribution Date) to but excluding such Special Distribution
Date and (ii) the Trustee shall transfer an amount equal to that amount of
Escrowed Funds that would have been used to purchase the Postponed Notes
designated in such notice (together with the earnings described in clause (i)(B)
of this paragraph above) plus the amount paid by the Company pursuant to clause
(i) of this paragraph to the Special Payments Account for distribution as a
Special Payment in accordance with the provisions hereof.
If, on the Cut-off Date, an amount equal to less than all of the
initial Escrowed Funds (other than Escrowed Funds referred to in the immediately
preceding paragraph) has been used to purchase Postponed Notes, on the Special
Distribution Date established pursuant to Section 4.02(c) for the distribution
to the Certificateholders of Escrowed Funds with respect to all of the Postponed
Notes that have not been purchased on or prior to the Cut-off Date (other than
any Postponed Notes referred to in the immediately preceding paragraph) (i) the
Company shall pay to the Trustee for deposit in the Special Payments Account, in
immediately available funds, an amount equal to (A) the interest that would have
accrued on Postponed Notes originally contemplated to be purchased with such
unused Escrowed Funds (other than Escrowed Funds referred to in the immediately
preceding paragraph) but not so purchased at a rate equal to the interest rate
applicable to the Certificates from and including the Issuance Date (if such
Special Distribution Date shall occur on or prior to the initial Regular
Distribution Date) or the initial Regular Distribution Date (if such Special
Distribution Date occurs after the initial Regular Distribution Date) to but
excluding such Special Distribution Date, minus (B) the earnings on Specified
Investments received (with respect to the portion of the Escrowed Funds
deposited with respect to the Postponed Notes described in this paragraph) by
the Trustee from and including the Issuance Date (if such Special Distribution
Date shall occur on or prior to the initial Regular Distribution Date) or the
26
-20-
initial Regular Distribution Date (if such Special Distribution Date occurs
after the initial Regular Distribution Date) to but excluding such Special
Distribution Date and (ii) the Trustee shall transfer such unused Escrowed Funds
(together with the earnings described in clause (i)(B) of this paragraph above)
and the amount paid by the Company pursuant to the clause (i) of this paragraph
to the Special Payments Account for distribution as a Special Payment in
accordance with the provisions hereof.
Section 2.02. Acceptance by Trustee. The Trustee, upon the execution
and delivery of this Agreement, acknowledges its acceptance of all right, title
and interest in and to the Trust Property and declares that the Trustee holds
and will hold such right, title and interest for the benefit of all then present
and future Certificateholders, upon the trusts herein set forth. Subject to
Section 7.14, the Trustee shall take all actions reasonably necessary to effect
the registration of all of the Equipment Notes acquired by the Trust in the name
of the Subordination Agent. By its payment for and acceptance of each
Certificate issued to it under this Agreement, each initial Certificateholder as
grantor of the Trust thereby joins in the creation and declaration of the Trust.
Section 2.03. Limitation of Powers. The Trust is constituted solely
for the purpose of making the investment in the Equipment Notes to be held in
the Trust, and, except as set forth herein, the Trustee shall not be authorized
or empowered to acquire any other investments or engage in any other activities
and, in particular, the Trustee shall not be authorized or empowered to do
anything that would cause such Trust to fail to qualify as a "grantor trust" for
federal income tax purposes (including as subject to this restriction, acquiring
any Aircraft (as defined in the respective Indentures) by bidding such Equipment
Notes or otherwise, or taking any action with respect to any such Aircraft once
acquired).
ARTICLE III
THE CERTIFICATES
Section 3.01. Title, Form, Denomination and Execution of
Certificates. (a) The Initial Certificates shall be known as
27
-21-
the "7.522% Initial Pass Through Certificates, Series 1997-2D" and the Exchange
Certificates shall be known as the "7.522% Exchange Pass Through Certificates,
Series 1997-2D", in each case, of the Trust. Each Certificate will represent a
fractional undivided interest in the Trust and shall be substantially in the
form set forth as Exhibit A hereto, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Agreement and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be
determined by the Trustee or the officers executing such Certificates, as
evidenced by the Trustee's or officer's execution of the Certificates.
(b) The Initial Certificates shall be issued only in fully
registered form without coupons and only in denominations of $100,000 or
integral multiples of $1,000 in excess thereof, except that one Certificate may
be issued in a different denomination. The Exchange Certificates will be issued
in denominations of $1,000 or integral multiples thereof, except that one
Certificate may be issued in a different denomination. Each Certificate shall be
dated the date of its authentication. The aggregate Fractional Undivided
Interest of Certificates shall not at any time exceed $27,369,000.
(c) The Initial Certificates offered and sold in reliance on Rule
144A shall be issued in the form of one or more global Certificates
substantially in the form of Exhibit A hereto with such applicable legends as
are provided for in Section 3.02 (each a "Restricted Global Certificate") duly
executed and authenticated by the Trustee as hereinafter provided. Such
Restricted Global Certificates shall be in registered form and be registered in
the name of DTC and deposited with the Trustee, at its Corporate Trust Office,
as custodian for DTC. The aggregate principal amount of any Restricted Global
Certificate may from time to time be increased or decreased by adjustments made
on the records of the Trustee, as custodian for DTC for such Restricted Global
Certificate, as provided in Section 3.06 hereof, which adjustments shall be
conclusive as to the aggregate principal amount of any such Global Certificate.
(d) The Initial Certificates offered and sold outside the United
States in reliance on Regulation S shall be issued in the form of one or more
global Certificates substantially in the form of Exhibit A hereto (each a
"Regulation S Global Certificate") duly executed and authenticated by the
Trustee as hereinafter provided. Such Regulation S Global Certificates shall be
in registered form and be registered in the name of DTC and deposited with the
Trustee, at its Corporate Trust Office, as
28
-22-
custodian for DTC, for credit initially and during the Restricted Period
(hereinafter defined) to the respective accounts of beneficial owners of such
Certificates (or to such other accounts as they may direct) at Xxxxxx Guaranty
Trust Company of New York, Brussels office, as operator of Euroclear or Cedel.
As used herein, the term "Restricted Period", with respect to the Regulation S
Global Certificates offered and sold in reliance on Regulation S, means the
period of 40 consecutive days beginning on and including the later of (i) the
day on which the Certificates are first offered to persons other than
distributors (as defined in Regulation S) in reliance on Regulation S and (ii)
the date of the closing of the offering under the Purchase Agreement. The
aggregate principal amount of any Regulation S Global Certificate may from time
to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for DTC for such Global Certificate, as provided in
Section 3.06 hereof, which adjustments shall be conclusive as to the aggregate
principal amount of any such Global Certificate. The Restricted Global
Certificate and Regulation S Global Certificate are sometimes collectively
referred to herein as the "Global Certificates".
(e) Certificates issued pursuant to Section 3.05(b) in exchange for
interests in a Restricted Global Certificate shall be issued substantially in
the form of Exhibit A hereto in definitive, fully registered form without
interest coupons with such applicable legends as are provided for in Section
3.02 (the "Restricted Definitive Certificates"). Certificates issued pursuant to
Section 3.05(b) in exchange for interests in a Regulation S Global Certificate
shall be issued substantially in the form of Exhibit A hereto in definitive,
fully registered form without interest coupons (the "Regulation S Definitive
Certificates"). The Restricted Definitive Certificates and the Regulation S
Definitive Certificates are sometimes collectively referred to herein as the
"Definitive Certificates".
(f) The Exchange Certificates shall be issued in the form of one or
more global Certificates substantially in the form of Exhibit A hereto (each, a
"Global Exchange Certificate"), except that (i) the Restricted Legend
(hereinafter defined) shall be omitted and (ii) such Exchange Certificates shall
contain such appropriate insertions, omissions, substitutions and other
variations from the form set forth in Exhibit A hereto relating to the nature of
the Exchange Certificates as the Responsible Officer of the Trustee executing
such Exchange Certificates on behalf of the Trust may determine, as evidenced by
such officer's execution on behalf of the Trust of such Exchange Certificates.
Such Global Exchange Certificates shall be in registered form and be registered
in the name of DTC and deposited with the Trustee, at its Corporate Trust
Office, as custodian for DTC. The
29
-23-
aggregate principal amount of any Global Exchange Certificate may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for DTC for such Global Exchange Certificate, which
adjustments shall be conclusive as to the aggregate principal amount of any such
Global Exchange Certificate. Subject to clauses (i) and (ii) of the first
sentence of this Section 3.01(f), the terms hereof applicable to Restricted
Global Certificates and/or Global Certificates shall apply to the Global
Exchange Certificates, mutatis mutandis.
(g) The definitive Certificates shall be in registered form and
shall be typed, printed, lithographed or engraved or produced by any combination
of these methods or may be produced in any other manner, all as determined by
the officers executing such Certificates, as evidenced by their execution of
such Certificates.
Section 3.02. Restrictive Legends. All Initial Certificates issued
pursuant to this Agreement for resale pursuant to Rule 144A (including any
Global Certificate issued upon registration of transfer, in exchange for or in
lieu of such Certificates) or issued pursuant to Section 3.05(b) in exchange for
interests in a Restricted Global Certificate shall be "Restricted Certificates"
and shall bear a legend to the following effect (the "Restricted Legend") unless
the Company and the Trustee determine otherwise consistent with applicable law:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY
ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
CERTIFICATE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S
UNDER THE SECURITIES ACT; (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS
AFTER THE LATER OF THE ORIGINAL ISSUANCE OF THIS CERTIFICATE OR THE LAST
DATE ON WHICH THIS CERTIFICATE WAS HELD BY CONTINENTAL AIRLINES, INC., THE
TRUSTEE OR ANY AFFILIATE OF ANY OF SUCH PERSONS RESELL OR OTHERWISE
TRANSFER THIS CERTIFICATE EXCEPT (A) TO CONTINENTAL AIRLINES, INC., (B) TO
A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION
IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION
30
-24-
STATEMENT UNDER THE SECURITIES ACT; AND (3) AGREES THAT IF IT SHOULD
RESELL OR OTHERWISE TRANSFER THIS CERTIFICATE IT WILL DELIVER TO EACH
PERSON TO WHOM THIS CERTIFICATE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS
CERTIFICATE WITHIN TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE OF
THIS CERTIFICATE OR THE LAST DATE ON WHICH THIS CERTIFICATE WAS HELD BY
CONTINENTAL AIRLINES, INC., THE TRUSTEE OR ANY AFFILIATE OF ANY OF SUCH
PERSONS, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION", "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO
THEM BY REGULATION S UNDER THE SECURITIES ACT. THE PASS THROUGH TRUST
AGREEMENT CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER
ANY TRANSFER OF THIS CERTIFICATE IN VIOLATION OF THE FOREGOING
RESTRICTIONS."
Each Global Certificate shall bear the following legend on the face
thereof:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 3.05 AND 3.06 OF THE PASS THROUGH TRUST
AGREEMENT REFERRED TO HEREIN."
Section 3.03. Authentication of Certificates. (a) On the Issuance
Date, the Trustee shall duly execute, authenticate and deliver Initial
Certificates in authorized denominations equalling in the aggregate the amount
set forth, with respect to the Trust, in Schedule II to the Purchase Agreement,
evidencing the entire ownership of the Trust, which amount equals the aggregate
principal amount of Equipment Notes which have been or
31
-25-
may be purchased by the Trustee pursuant to each Financing Agreement.
Thereafter, the Trustee shall duly execute, authenticate and deliver
Certificates as herein provided.
(b) No Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose, unless there appears on
such Certificate a certificate of authentication substantially in the form
provided for herein executed by the Trustee by the manual signature of one of
its authorized signatories, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.
Section 3.04. Transfer and Exchange. The Trustee shall cause to be
kept at the office or agency to be maintained by it in accordance with the
provisions of Section 7.12 a register (the "Register") of the Certificates in
which, subject to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of such Certificates and of transfers and
exchanges of such Certificates as herein provided. The Trustee shall initially
be the registrar (the "Registrar") for the purpose of registering such
Certificates and transfers and exchanges of such Certificates as herein
provided.
All Certificates issued upon any registration of transfer or
exchange of Certificates shall be valid obligations of the Trust, evidencing the
same interest therein, and entitled to the same benefits under this Agreement,
as the Certificates surrendered upon such registration of transfer or exchange.
A Certificateholder may transfer a Certificate, or request that a
Certificate be exchanged for Certificates (including, without limitation,
subject to the proviso to this sentence, Exchange Certificates) in authorized
denominations and in an aggregate Fractional Undivided Interest equal to the
Fractional Undivided Interest of such Certificate surrendered for exchange of
other authorized denominations, by surrender of such Certificate to the Trustee
with the form of transfer notice thereon duly completed and executed, and
otherwise complying with the terms of this Agreement, including providing
evidence of compliance with any restrictions on transfer, in form satisfactory
to the Trustee and the Registrar; provided that exchanges of Initial
Certificates for Exchange Certificates shall occur only after an Exchange Offer
Registration Statement shall have been declared effective by the SEC (notice of
which shall be provided to the Trustee by the Company) and otherwise only in
accordance with the terms of the Exchange Offer. No such transfer shall be
effected until, and such transferee shall succeed to the rights of a
Certificateholder only upon, final acceptance and registration of the transfer
by the Registrar in
32
-26-
the Register. Prior to the registration of any transfer by a Certificateholder
as provided herein, the Trustee shall treat the person in whose name the
Certificate is registered as the owner thereof for all purposes, and the Trustee
shall not be affected by notice to the contrary. Furthermore, DTC shall, by
acceptance of a Global Certificate, agree that transfers of beneficial interests
in such Global Certificate may be effected only through a book-entry system
maintained by DTC (or its agent) and that ownership of a beneficial interest in
the Certificate shall be required to be reflected in a book-entry. When
Certificates are presented to the Registrar with a request to register the
transfer thereof or to exchange them for other authorized denominations of a
Certificate in a Fractional Undivided Interest equal to the aggregate Fractional
Undivided Interest of Certificates surrendered for exchange, the Registrar shall
register the transfer or make the exchange as requested if its requirements for
such transactions are met.
To permit registrations of transfers and exchanges in accordance
with the terms, conditions and restrictions hereof, the Trustee shall execute,
authenticate and deliver Certificates at the Registrar's request. No service
charge shall be made to a Certificateholder for any registration of transfer or
exchange of Certificates, but the Trustee shall require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates. All Certificates
surrendered for registration of transfer or exchange shall be canceled and
subsequently destroyed by the Trustee.
Section 3.05. Book-Entry Provisions for Restricted Global
Certificates and Regulation S Global Certificates. (a) Members of, or
participants in, DTC ("Agent Members") shall have no rights under this Agreement
with respect to any Global Certificate held on their behalf by DTC, or the
Trustee as its custodian, and DTC may be treated by the Trustee and any agent of
the Trustee as the absolute owner of such Global Certificate for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Trustee or any agent of the Trustee from giving effect to any written
certification, proxy or other authorization furnished by DTC or shall impair, as
between DTC and its Agent Members, the operation of customary practices
governing the exercise of the rights of a holder of any Certificate. Upon the
issuance of any Global Certificate, the Registrar or its duly appointed agent
shall record DTC as the registered holder of such Global Certificate.
(b) Transfers of any Global Certificate shall be limited to
transfers of such Restricted Global Certificate or Regulation S Global
Certificate in whole, but not in part, to
33
-27-
DTC. Beneficial interests in the Restricted Global Certificate and any
Regulation S Global Certificate may be transferred in accordance with the rules
and procedures of DTC and the provisions of Section 3.06. Beneficial interests
in a Restricted Global Certificate or a Regulation S Global Certificate shall be
delivered to all beneficial owners thereof in the form of Restricted Definitive
Certificates or Regulation S Definitive Certificates, as the case may be, if (i)
DTC notifies the Trustee that it is unwilling or unable to continue as
depositary for such Restricted Global Certificate or Regulation S Global
Certificate, as the case may be, and a successor depositary is not appointed by
the Trustee within 90 days of such notice, and (ii) after the occurrence and
during the continuance of an Event of Default, owners of beneficial interests in
a Global Certificate with Fractional Undivided Interests aggregating not less
than a majority in interest in the Trust advise the Trustee, the Company and DTC
through Agent Members in writing that the continuation of a book-entry system
through DTC or its successor is no longer in their best interests.
(c) Any beneficial interest in one of the Global Certificates that
is transferred to a Person who takes delivery in the form of an interest in
another Global Certificate will, upon such transfer, cease to be an interest in
such Global Certificate and become an interest in the other Global Certificate
and, accordingly, will thereafter be subject to all transfer restrictions, if
any, and other procedures applicable to beneficial interests in such other
Global Certificate for as long as it remains such an interest.
(d) In connection with the transfer of an entire Restricted Global
Certificate or an entire Regulation S Global Certificate to the beneficial
owners thereof pursuant to paragraph (b) of this Section 3.05, such Restricted
Global Certificate or Regulation S Global Certificate, as the case may be, shall
be deemed to be surrendered to the Trustee for cancellation, and the Trustee
shall execute, authenticate and deliver, to each beneficial owner identified by
DTC in exchange for its beneficial interest in such Restricted Global
Certificate or Regulation S Global Certificate, as the case may be, an equal
aggregate principal amount of Restricted Definitive Certificates or Regulation S
Definitive Certificates, as the case may be, of authorized denominations. None
of the Company, the Registrar, the Paying Agent nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such registration instructions. Upon the
issuance of Definitive Certificates, the Trustee shall recognize the Person in
whose name the Definitive Certificates are registered in the Register as
Certificateholders hereunder. Neither the Company nor the Trustee shall be
liable if the
34
-28-
Trustee or the Company is unable to locate a qualified successor clearing
agency.
(e) Any Definitive Certificate delivered in exchange for an interest
in the Restricted Global Certificate pursuant to paragraph (b) of this Section
3.05 shall, except as otherwise provided by paragraph (e) of Section 3.06, bear
the Restricted Legend.
(f) Prior to the expiration of the Restricted Period, any Regulation
S Definitive Certificate delivered in exchange for an interest in a Regulation S
Global Certificate pursuant to paragraph (b) of this Section shall bear the
Restricted Legend.
(g) The registered holder of any Restricted Global Certificate or
Regulation S Global Certificate may grant proxies and otherwise authorize any
Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Agreement or the Certificates.
Section 3.06. Special Transfer Provisions. Unless and until (i) an
Initial Certificate is sold under an effective Shelf Registration Statement, or
(ii) an Initial Certificate is exchanged for an Exchange Certificate pursuant to
an effective Exchange Offer Registration Statement, in each case pursuant to the
terms of the Registration Rights Agreement, the following provisions shall apply
to such Initial Certificates:
(a) Transfers to Non-QIB Institutional Accredited Investors.
The following provisions shall apply with respect to the registration
of any proposed transfer of a Certificate to any Institutional
Accredited Investor which is neither a QIB nor a Non-U.S. Person:
(i) The Registrar shall register the transfer of any
Certificate, whether or not bearing the Restricted Legend, only if
the requested transfer is at least two years after the later of the
original issue date of the Certificates and the last date on which
such Certificate was held by the Company, the Trustee or any
affiliate of any of such Persons. Except as provided in the
foregoing sentence, the Registrar shall not register the transfer of
any Certificate to any Institutional Accredited Investor which is
neither a QIB nor a Non-U.S. Person.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed
35
-29-
transfer of an Initial Certificate to a QIB (excluding Non-U.S. Persons):
(i) If the Certificate to be transferred consists of an
interest in any Regulation S Global Certificate during the
Restricted Period, the Registrar shall register the transfer if such
transfer is being made by a proposed transferor who has checked the
box provided for on the form of Initial Certificate stating, or has
otherwise advised the Trustee and the Registrar in writing, that the
sale has been made in compliance with the provisions of Rule 144A to
a transferee who has signed the certification provided for on the
form of Initial Certificate stating, or has otherwise advised the
Trustee and the Registrar in writing, that it is purchasing the
Initial Certificate for its own account or an account with respect
to which it exercises sole investment discretion and that it, or the
Person on whose behalf it is acting with respect to any such
account, is a QIB within the meaning of Rule 144A, and is aware that
the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the
Trust and/or the Company as it has requested pursuant to Rule 144A
or has determined not to request such information and that it is
aware that the transferor is relying upon its foregoing
representations in order to claim the exemption from registration
provided by Rule 144A.
(ii) Upon receipt by the Registrar of the documents required
by clause (i) above and instructions given in accordance with DTC's
and the Registrar's procedures therefor, the Registrar shall reflect
on its books and records the date of such transfer and an increase
in the principal amount of a Restricted Global Certificate in an
amount equal to the principal amount of interests in such Regulation
S Global Certificate being transferred, and the Trustee shall
decrease the amount of such Regulation S Global Certificate so
transferred.
(c) Transfers of Interests in the Regulation S Global Certificate or
Regulation S Definitive Certificates. After the expiration of the
Restricted Period, the Registrar shall register any transfer of interests
in any Regulation S Global Certificate or Regulation S Definitive
Certificates without requiring any additional certification. Until the
expiration of the Restricted Period, interests in the Regulation S Global
Certificate may only be held through
36
-30-
Agent Members acting for and on behalf of Euroclear and Cedel.
(d) Transfers to Non-U.S. Persons at Any Time. The following
provisions shall apply with respect to any registration of any transfer of
an Initial Certificate to a Non-U.S. Person:
(i) Prior to the expiration of the Restricted Period, the
Registrar shall register any proposed transfer of an Initial
Certificate to a Non-U.S. Person upon receipt of a certificate
substantially in the form set forth as Exhibit B hereto from the
proposed transferor.
(ii) After the expiration of the Restricted Period, the
Registrar shall register any proposed transfer to any Non-U.S.
Person if the Certificate to be transferred is a Restricted
Definitive Certificate or an interest in a Restricted Global
Certificate, upon receipt of a certificate substantially in the form
of Exhibit B from the proposed transferor. The Registrar shall
promptly send a copy of such certificate to the Company.
(iii) Upon receipt by the Registrar of (x) the documents, if
any, required by clause (ii) and (y) instructions in accordance with
DTC's and the Registrar's procedures, the Registrar shall reflect on
its books and records the date of such transfer and a decrease in
the principal amount of such Restricted Global Certificate in an
amount equal to the principal amount of the beneficial interest in
such Restricted Global Certificate to be transferred, and, upon
receipt by the Registrar of instructions given in accordance with
DTC's and the Registrar's procedures, the Registrar shall reflect on
its books and records the date and an increase in the principal
amount of the Regulation S Global Certificate in an amount equal to
the principal amount of the Restricted Definitive Certificate or the
Restricted Global Certificate, as the case may be, to be
transferred, and the Trustee shall cancel the Definitive
Certificate, if any, so transferred or decrease the amount of such
Restricted Global Certificate.
(e) Restricted Legend. Upon the transfer, exchange or replacement of
Certificates not bearing the Restricted Legend, the Registrar shall
deliver Certificates that do not bear the Restricted Legend. Upon the
transfer, exchange or
37
-31-
replacement of Certificates bearing the Restricted Legend, the Registrar
shall deliver only Certificates that bear the Restricted Legend unless
either (i) the circumstances contemplated by paragraph (d)(ii) of this
Section 3.06 exist or (ii) there is delivered to the Registrar an Opinion
of Counsel to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with
the provisions of the Securities Act.
(f) General. By acceptance of any Certificate bearing the Restricted
Legend, each Holder of such a Certificate acknowledges the restrictions on
transfer of such Certificate set forth in such Restricted Legend and
otherwise in this Agreement and agrees that it will transfer such
Certificate only as provided in such Restricted Legend and otherwise in
this Agreement. The Registrar shall not register a transfer of any
Certificate unless such transfer complies with the restrictions on
transfer, if any, of such Certificate set forth in such Restricted Legend
and otherwise in this Agreement. In connection with any transfer of
Certificates, each Certificateholder agrees by its acceptance of the
Certificates to furnish the Registrar or the Trustee such certifications,
legal opinions or other information as either of them may reasonably
require to confirm that such transfer is being made pursuant to an
exemption from, or a transaction not subject to, the registration
requirements of the Securities Act and in accordance with the terms and
provisions of this Article III; provided that the Registrar shall not be
required to determine the sufficiency of any such certifications, legal
opinions or other information.
Until such time as no Certificates remain Outstanding, the Registrar
shall retain copies of all letters, notices and other written communications
received pursuant to Section 3.05 or this Section 3.06. The Trustee, if not the
Registrar at such time, shall have the right to inspect and make copies of all
such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Registrar.
Section 3.07. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Registrar or the Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate and (b) there is delivered to the Registrar and the Trustee such
security, indemnity or bond, as may be required by them to save each of them
harmless, then, in the absence of notice to the Registrar or the Trustee that
such destroyed, lost or stolen
38
-32-
Certificate has been acquired by a bona fide purchaser, and provided that the
requirements of Section 8-405 of the Uniform Commercial Code in effect in any
applicable jurisdiction are met, the Trustee shall execute, authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate or Certificates, in authorized
denominations and of like Fractional Undivided Interest and bearing a number not
contemporaneously outstanding.
In connection with the issuance of any new Certificate under this
Section 3.07, the Trustee shall require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee and the
Registrar) connected therewith.
Any duplicate Certificate issued pursuant to this Section 3.07 shall
constitute conclusive evidence of the appropriate Fractional Undivided Interest
in the Trust, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Certificates.
Section 3.08. Persons Deemed Owners. Prior to due presentment of a
Certificate for registration of transfer, the Trustee, the Registrar and any
Paying Agent may treat the Person in whose name any Certificate is registered
(as of the day of determination) as the owner of such Certificate for the
purpose of receiving distributions pursuant to Article IV and for all other
purposes whatsoever, and none of the Trustee, the Registrar or any Paying Agent
shall be affected by any notice to the contrary.
Section 3.09. Cancellation. All Certificates surrendered for payment
or transfer or exchange shall, if surrendered to the Trustee or any agent of the
Trustee other than the Registrar, be delivered to the Registrar for cancellation
and shall promptly be canceled by it. No Certificates shall be authenticated in
lieu of or in exchange for any Certificates canceled as provided in this
Section, except as expressly permitted by this Agreement. All canceled
Certificates held by the Registrar shall be destroyed and a certification of
their destruction delivered to the Trustee.
Section 3.10. Temporary Certificates. Until definitive Certificates
are ready for delivery, the Trustee shall
39
-33-
authenticate temporary Certificates. Temporary Certificates shall be
substantially in the form of definitive Certificates but may have insertions,
substitutions, omissions and other variations determined to be appropriate by
the officers executing the temporary Certificates, as evidenced by their
execution of such temporary Certificates. If temporary Certificates are issued,
the Trustee will cause definitive Certificates to be prepared without
unreasonable delay. After the preparation of definitive Certificates, the
temporary Certificates shall be exchangeable for definitive Certificates upon
surrender of the temporary Certificates at the office or agency of the Trustee
designated for such purpose pursuant to Section 7.12, without charge to the
Certificateholder. Upon surrender for cancellation of any one or more temporary
Certificates, the Trustee shall execute, authenticate and deliver in exchange
therefor a like face amount of definitive Certificates of authorized
denominations. Until so exchanged, the temporary Certificates shall be entitled
to the same benefits under this Agreement as definitive Certificates.
Section 3.11. Limitation of Liability for Payments. All payments and
distributions made to Certificateholders in respect of the Certificates shall be
made only from the Trust Property and only to the extent that the Trustee shall
have sufficient income or proceeds from the Trust Property to make such payments
in accordance with the terms of Article IV of this Agreement. Each
Certificateholder, by its acceptance of a Certificate, agrees that it will look
solely to the income and proceeds from the Trust Property for any payment or
distribution due to such Certificateholder pursuant to the terms of this
Agreement and that it will not have any recourse to the Company, the Trustee,
the Loan Trustees, the Second Mortgagee or the Liquidity Provider, except as
otherwise expressly provided herein or in the Intercreditor Agreement.
The Company is a party to this Agreement solely for purposes of
meeting the requirements of the Trust Indenture Act, and therefore shall not
have any right, obligation or liability hereunder (except as otherwise expressly
provided herein).
Section 3.12. ERISA Restrictive Legend. All Certificates issued
pursuant to this Agreement shall bear a legend to the following effect (the
"ERISA Legend") unless the Company and the Trustee determine otherwise
consistent with applicable law:
"BY ITS ACQUISITION HEREOF, THE HOLDER REPRESENTS THAT (A) IT IS NOT
A PLAN TRANSFEREE (AS DEFINED IN THE PASS THROUGH TRUST AGREEMENT) OR (B) IT IS
AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT TO ACQUIRE THIS
CERTIFICATE, AND
40
-34-
THE CONDITIONS OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ISSUED BY THE
U.S. DEPARTMENT OF LABOR HAVE BEEN AND WILL CONTINUE TO BE SATISFIED IN
CONNECTION WITH ITS PURCHASE AND HOLDING OF THIS CERTIFICATE. THE PASS THROUGH
TRUST AGREEMENT CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER
ANY TRANSFER OF THIS CERTIFICATE IN VIOLATION OF THE FOREGOING RESTRICTIONS."
Without limitation of Section 3.06(f), by acceptance of any
Certificate bearing the ERISA Legend, each Holder of such a Certificate
acknowledges the restrictions set forth in such ERISA Legend. The Registrar
shall refuse to register any transfer of any Certificate in violation of the
restrictions set forth in such ERISA Legend.
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
STATEMENTS TO CERTIFICATEHOLDERS
Section 4.01. Certificate Account and Special Payments Account. (a)
The Trustee shall establish and maintain on behalf of the Certificateholders a
Certificate Account as one or more non-interest-bearing accounts. The Trustee
shall hold the Certificate Account in trust for the benefit of the
Certificateholders, and shall make or permit withdrawals therefrom only as
provided in this Agreement. On each day when a Scheduled Payment is made to the
Trustee under the Intercreditor Agreement, the Trustee upon receipt thereof
shall immediately deposit the aggregate amount of such Scheduled Payment in the
Certificate Account.
(b) The Trustee shall establish and maintain on behalf of the
Certificateholders a Special Payments Account as one or more accounts, which
shall be non-interest bearing except as provided in Section 4.04. The Trustee
shall hold the Special Payments Account in trust for the benefit of the
Certificateholders and shall make or permit withdrawals therefrom only as
provided in this Agreement. On each day when one or more Special Payments are
made to the Trustee under the Intercreditor Agreement, the Trustee, upon receipt
thereof, shall immediately deposit the aggregate amount of such Special Payments
in the Special Payments Account.
(c) The Trustee shall cause the Subordination Agent to present to
the related Loan Trustee of each Equipment Note such Equipment Note on the date
of its stated final maturity or, in the case of any Equipment Note which is to
be redeemed in whole pursuant to the related Indenture, on the applicable
redemption date under such Indenture.
41
-35-
Section 4.02. Distributions from Certificate Account and Special
Payments Account. (a) On each Regular Distribution Date or as soon thereafter as
the Trustee has confirmed receipt of the payment of all or any part of the
Scheduled Payments due on such date, the Trustee shall distribute out of the
Certificate Account the entire amount deposited therein pursuant to Section
4.01(a). There shall be so distributed to each Certificateholder of record on
the Record Date with respect to such Regular Distribution Date (other than as
provided in Section 11.01 concerning the final distribution) by check mailed to
such Certificateholder, at the address appearing in the Register, such
Certificateholder's pro rata share (based on the Fractional Undivided Interest
in the Trust held by such Certificateholder) of the total amount in the
Certificate Account, except that, with respect to Certificates registered on the
Record Date in the name of DTC, such distribution shall be made by wire transfer
in immediately available funds to the account designated by DTC.
(b) On each Special Distribution Date with respect to any Special
Payment or as soon thereafter as the Trustee has confirmed receipt of such
Special Payment, the Trustee shall distribute out of the Special Payments
Account the entire amount of such Special Payment deposited therein pursuant to
Section 4.01(b). There shall be so distributed to each Certificateholder of
record on the Record Date with respect to such Special Distribution Date (other
than as provided in Section 11.01 concerning the final distribution) by check
mailed to such Certificateholder, at the address appearing in the Register, such
Certificateholder's pro rata share (based on the Fractional Undivided Interest
in the Trust held by such Certificateholder) of the total amount in the Special
Payments Account on account of such Special Payment, except that, with respect
to Certificates registered on the Record Date in the name of DTC, such
distribution shall be made by wire transfer in immediately available funds to
the account designated by DTC.
(c) The Trustee shall, at the expense of the Company, cause notice
of each Special Payment to be mailed to each Certificateholder at his address as
it appears in the Register. In the event of redemption or purchase of Equipment
Notes held in the Trust, such notice shall be mailed not less than 20 days prior
to the Special Distribution Date for the Special Payment resulting from such
redemption or purchase, which Special Distribution Date shall be the date of
such redemption or purchase. In the event that the Trustee receives a notice
from the Company that Postponed Notes will not be purchased pursuant to Section
2.01, such notice of Special Payment shall be mailed as soon as practicable
after receipt of such notice from the Company and shall state the Special
Distribution Date for such Special Payment, which shall occur 20 days after the
date of such
42
-36-
notice of Special Payment or (if such 20th day is not practicable) as soon as
practicable thereafter. In the event that any Special Payment is to be made
pursuant to the last paragraph of Section 2.01(b) hereof, on the Cut-Off Date
(or, if such Cut-Off Date is not practicable, as soon as practicable after the
Cut-Off Date), notice of such Special Payment shall be mailed stating the
Special Distribution Date for such Special Payment, which shall occur 20 days
after the date of such notice of such Special Payment (or, if such 20th day is
not practicable, as soon as practicable thereafter). In the case of any other
Special Payments, such notice shall be mailed as soon as practicable after the
Trustee has confirmed that it has received funds for such Special Payment,
stating the Special Distribution Date for such Special Payment which shall occur
not less than 20 days after the date of such notice and as soon as practicable
thereafter. Notices mailed by the Trustee shall set forth:
(i) the Special Distribution Date and the Record Date
therefor (except as otherwise provided in Section 11.01),
(ii) the amount of the Special Payment for each $1,000 face
amount Certificate and the amount thereof constituting principal,
premium, if any, and interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a
Regular Distribution Date, the total amount to be received on such
date for each $1,000 face amount Certificate.
If the amount of premium, if any, payable upon the redemption or purchase of an
Equipment Note has not been calculated at the time that the Trustee mails notice
of a Special Payment, it shall be sufficient if the notice sets forth the other
amounts to be distributed and states that any premium received will also be
distributed.
If any redemption of the Equipment Notes held in the Trust is
canceled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Certificateholder at its address as it
appears on the Register.
Section 4.03. Statements to Certificateholders. (a) On each
Distribution Date, the Trustee will include with each distribution to
Certificateholders of a Scheduled Payment or Special Payment, as the case may
be, a statement setting forth the following information (per $1,000 face amount
Certificate as to (i) and (ii) below):
43
-37-
(i) the amount of such distribution allocable to principal and
the amount allocable to premium, if any;
(ii) the amount of such distribution allocable to interest; and
(iii) the Pool Balance and the Pool Factor.
With respect to the Certificates registered in the name of DTC, on
the Record Date prior to each Distribution Date, the Trustee will request from
DTC a securities position listing setting forth the names of all Agent Members
reflected on DTC's books as holding interests in the Certificates on such Record
Date. On each Distribution Date, the Trustee will mail to each such Agent Member
the statement described above and will make available additional copies as
requested by such Agent Member for forwarding to holders of interests in the
Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Trustee
shall furnish to each Person who at any time during such calendar year was a
Certificateholder of record a statement containing the sum of the amounts
determined pursuant to clauses (a)(i) and (a)(ii) above for such calendar year
or, in the event such Person was a Certificateholder of record during a portion
of such calendar year, for such portion of such year, and such other items as
are readily available to the Trustee and which a Certificateholder shall
reasonably request as necessary for the purpose of such Certificateholder's
preparation of its federal income tax returns. Such statement and such other
items shall be prepared on the basis of information supplied to the Trustee by
the Agent Members and shall be delivered by the Trustee to such Agent Members to
be available for forwarding by such Agent Members to the holders of interests in
the Certificates in the manner described in Section 4.03(a).
Section 4.04. Investment of Special Payment Moneys. Any money
received by the Trustee pursuant to Section 4.01(b) representing a Special
Payment which is not distributed on the date received shall, to the extent
practicable, be invested in Permitted Investments by the Trustee pending
distribution of such Special Payment pursuant to Section 4.02. Any investment
made pursuant to this Section 4.04 shall be in such Permitted Investments having
maturities not later than the date that such moneys are required to be used to
make the payment required under Section 4.02 on the applicable Special
Distribution Date and the Trustee shall hold any such Permitted Investments
until maturity. The Trustee shall have no liability with respect to any
investment made pursuant to this Section 4.04, other than by
44
-38-
reason of the willful misconduct or negligence of the Trustee. All income and
earnings from such investments shall be distributed on such Special Distribution
Date as part of such Special Payment.
ARTICLE V
THE COMPANY
Section 5.01. Maintenance of Corporate Existence. The Company, at
its own cost and expense, will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, rights and
franchises, except as otherwise specifically permitted in Section 5.02;
provided, however, that the Company shall not be required to preserve any right
or franchise if the Company shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company.
Section 5.02. Consolidation, Merger, etc. The Company shall not
consolidate with or merge into any other corporation or convey, transfer or
lease substantially all of its assets as an entirety to any Person unless:
(a) the corporation formed by such consolidation or into which the
Company is merged or the Person that acquires by conveyance, transfer or
lease substantially all of the assets of the Company as an entirety shall
be (i) organized and validly existing under the laws of the United States
of America or any state thereof or the District of Columbia, (ii) a
"citizen of the United States" as defined in 49 U.S.C. 40102(a)(15), as
amended, and (iii) a United States certificated air carrier, if and so
long as such status is a condition of entitlement to the benefits of
Section 1110 of the Bankruptcy Reform Act of 1978, as amended (11 U.S.C.
ss. 1110), with respect to the Leases;
(b) the corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, transfer or
lease substantially all of the assets of the Company as an entirety shall
execute and deliver to the Trustee a duly authorized, valid, binding and
enforceable agreement in form and substance reasonably satisfactory to the
Trustee containing an assumption by such successor corporation or Person
of the due and punctual performance and observance of each covenant and
condition of this Agreement, the Other Pass Through Trust Agreements and
each Financing Document to be performed or observed by the Company; and
45
-39-
(c) the Company shall have delivered to the Trustee an Officer's
Certificate of the Company and an Opinion of Counsel of the Company
reasonably satisfactory to the Trustee, each stating that such
consolidation, merger, conveyance, transfer or lease and the assumption
agreement mentioned in clause (b) above comply with this Section 5.02 and
that all conditions precedent herein provided for relating to such
transaction have been complied with.
Upon any consolidation or merger, or any conveyance, transfer or
lease of substantially all of the assets of the Company as an entirety in
accordance with this Section 5.02, the successor corporation or Person formed by
such consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Agreement with
the same effect as if such successor corporation or Person had been named as the
Company herein. No such conveyance, transfer or lease of substantially all of
the assets of the Company as an entirety shall have the effect of releasing any
successor corporation or Person which shall have become such in the manner
prescribed in this Section 5.02 from its liability in respect of this Agreement
and any Financing Document to which it is a party.
ARTICLE VI
DEFAULT
Section 6.01. Events of Default. (a) Exercise of Remedies. Upon the
occurrence and during the continuation of any Indenture Default under any
Indenture, the Trustee may, to the extent it is the Controlling Party at such
time (as determined pursuant to the Intercreditor Agreement), direct the
exercise of remedies as provided in the Intercreditor Agreement.
(b) Purchase Rights of Certificateholders. At any time after the
occurrence and during the continuation of a Triggering Event, each
Certificateholder shall have the right (which shall not expire upon any purchase
of the Class A Certificates pursuant to the Class B Trust Agreement or the
purchase of the Class A Certificates and the Class B Certificates pursuant to
the Class C Trust Agreement) to purchase all, but not less than all, of the
Class A Certificates, the Class B Certificates and the Class C Certificates upon
ten days' written notice to the Class A Trustee, the Class B Trustee, the Class
C Trustee and each other Certificateholder, provided that (A) if prior to the
end of such ten-day period any other Certificateholder notifies such purchasing
Certificateholder that such other Certificateholder wants to participate in such
46
-40-
purchase, then such other Certificateholder may join with the purchasing
Certificateholder to purchase all, but not less than all, of the Class A
Certificates, the Class B Certificates and the Class C Certificates pro rata
based on the Fractional Undivided Interest in the Trust held by each such
Certificateholder and (B) if prior to the end of such ten-day period any other
Certificateholder fails to notify the purchasing Certificateholder of such other
Certificateholder's desire to participate in such a purchase, then such other
Certificateholder shall lose its right to purchase the Class A Certificates, the
Class B Certificates and the Class C Certificates pursuant to this Section
6.01(b).
No such purchase of Class A Certificates, the Class B Certificates
and the Class C Certificates shall be effective unless the purchaser(s) shall
certify to the Other Trustees of each such Class that contemporaneously with
such purchase, such purchaser(s) is purchasing, pursuant to the terms of this
Agreement and the Other Pass Through Trust Agreements, the Class A Certificates,
the Class B Certificates and the Class C Certificates. Each payment of the
purchase price of the Certificates as determined in the Other Pass Through Trust
Agreement for such Class shall be made to an account or accounts designated by
the Other Trustee under such Other Pass Through Trust Agreement and each such
purchase shall be subject to the terms of this Section 6.01(b). The Class A
Certificates, the Class B Certificates and the Class C Certificates will be
deemed to be purchased on the date payment of the purchase price is made
notwithstanding the failure of the Class A Certificateholders, the Class B
Certificateholders or the Class C Certificateholders, as the case may be, to
deliver any Certificates of such Class (whether in the form of Definitive
Certificates or beneficial interests in Global Certificates (as defined in the
Other Pass Through Trust Agreement for such Class)) and, upon such a purchase,
(i) the only rights of the Class A Certificateholders, the Class B
Certificateholders or the Class C Certificateholders, as the case may be, will
be to deliver the Class A Certificates, the Class B Certificates or the Class C
Certificates, as the case may be, to the purchaser(s) and receive the purchase
price for such Certificates and (ii) if the purchaser(s) shall so request, such
Class A Certificateholders, Class B Certificateholders or Class C
Certificateholders, as the case may be, will comply with all the provisions of
Section 3.04 of the Other Pass Through Trust Agreement for such Class to enable
new Class A Certificates, Class B Certificates or Class C Certificates, as the
case may be, to be issued to the purchaser in such denominations as it shall
request. All charges and expenses in connection with the issuance of any such
new Class A Certificates, Class B Certificates or Class C Certificates, as the
case may be, shall be borne by the purchaser thereof.
47
-41-
As used in this Section 6.01(b), the terms "Class", "Class A
Certificate", "Class A Trustee", "Class B Certificate", "Class B Trust
Agreement", "Class B Trustee", "Class C Certificate", "Class C Trust Agreement"
and "Class C Trustee" shall have the respective meanings assigned to such terms
in the Intercreditor Agreement.
Section 6.02. Incidents of Sale of Equipment Notes. Upon any sale of
all or any part of the Equipment Notes held in the Trust made either under the
power of sale given under this Agreement or otherwise for the enforcement of
this Agreement, the following shall be applicable:
(1) Certificateholders and Trustee May Purchase Equipment Notes. Any
Certificateholder, the Trustee in its individual or any other capacity or
any other Person may bid for and purchase any of the Equipment Notes, and
upon compliance with the terms of sale, may hold, retain, possess and
dispose of such Equipment Notes held in the Trust in their own absolute
right without further accountability.
(2) Receipt of Trustee Shall Discharge Purchaser. The receipt of the
Trustee making such sale shall be a sufficient discharge to any purchaser
for his purchase money, and, after paying such purchase money and
receiving such receipt, such purchaser or its personal representative or
assigns shall not be obliged to see to the application of such purchase
money, or be in any way answerable for any loss, misapplication or
non-application thereof.
(3) Application of Moneys Received upon Sale. Any moneys collected
by the Trustee upon any sale made either under the power of sale given by
this Agreement or otherwise for the enforcement of this Agreement shall be
applied as provided in Section 4.02.
Section 6.03. Judicial Proceedings Instituted by Trustee; Trustee
May Bring Suit. If there shall be a failure to make payment of the principal of,
premium, if any, or interest on any Equipment Note held in the Trust, or if
there shall be any failure to pay Rent (as defined in the relevant Lease) under
any Lease when due and payable, then the Trustee, in its own name and as trustee
of an express trust, as holder of such Equipment Notes, to the extent permitted
by and in accordance with the terms of the Intercreditor Agreement and the
Financing Documents, shall be entitled and empowered to institute any suits,
actions or proceedings at law, in equity or otherwise, for the collection of the
sums so due and unpaid on such Equipment Notes or under such Lease and may
prosecute any such claim or proceeding to
48
-42-
judgment or final decree with respect to the whole amount of any such sums so
due and unpaid.
Section 6.04. Control by Certificateholders. Subject to Section 6.03
and the Intercreditor Agreement, the Certificateholders holding Certificates
evidencing Fractional Undivided Interests aggregating not less than a majority
in interest in the Trust shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee with
respect to the Trust or pursuant to the terms of the Intercreditor Agreement, or
exercising any trust or power conferred on the Trustee under this Agreement or
the Intercreditor Agreement, including any right of the Trustee as Controlling
Party under the Intercreditor Agreement or as holder of the Equipment Notes held
in the Trust, provided that
(1) such Direction shall not be in conflict with any rule of law or
with this Agreement and would not involve the Trustee in personal
liability or expense,
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Certificateholders not taking part in
such Direction, and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such Direction.
Section 6.05. Waiver of Past Defaults. Subject to the Intercreditor
Agreement, the Certificateholders holding Certificates evidencing Fractional
Undivided Interests aggregating not less than a majority in interest in the
Trust (i) may on behalf of all of the Certificateholders waive any past Event of
Default hereunder and its consequences or (ii) if the Trustee is the Controlling
Party, may direct the Trustee to instruct the applicable Loan Trustee to waive
any past Indenture Default under any Indenture and its consequences, and thereby
annul any Direction given by such Certificateholders or the Trustee to such Loan
Trustee and/or the Second Mortgagee with respect thereto, except a default:
(1) in the deposit of any Scheduled Payment or Special Payment under
Section 4.01 or in the distribution of any payment under Section 4.02 on
the Certificates, or
(2) in the payment of the principal of (premium, if any) or
interest on the Equipment Notes held in the Trust, or
49
-43-
(3) in respect of a covenant or provision hereof which under Article
IX cannot be modified or amended without the consent of each
Certificateholder holding an Outstanding Certificate affected thereby.
Upon any such waiver, such default shall cease to exist with respect
to the Certificates and any Event of Default arising therefrom shall be deemed
to have been cured for every purpose and any direction given by the Trustee on
behalf of the Certificateholders to the relevant Loan Trustee and/or the Second
Mortgagee shall be annulled with respect thereto; but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon. Upon any such waiver, the Trustee shall vote the
Equipment Notes issued under the relevant Indenture to waive the corresponding
Indenture Default.
Section 6.06. Right of Certificateholders to Receive Payments Not to
Be Impaired. Anything in this Agreement to the contrary notwithstanding,
including, without limitation, Section 6.07 hereof, but subject to the
Intercreditor Agreement, the right of any Certificateholder to receive
distributions of payments required pursuant to Section 4.02 hereof on the
Certificates when due, or to institute suit for the enforcement of any such
payment on or after the applicable Regular Distribution Date or Special
Distribution Date, shall not be impaired or affected without the consent of such
Certificateholder.
Section 6.07. Certificateholders May Not Bring Suit Except Under
Certain Conditions. A Certificateholder shall not have the right to institute
any suit, action or proceeding at law or in equity or otherwise with respect to
this Agreement, for the appointment of a receiver or for the enforcement of any
other remedy under this Agreement, unless:
(1) such Certificateholder previously shall have given written
notice to the Trustee of a continuing Event of Default;
(2) Certificateholders holding Certificates evidencing Fractional
Undivided Interests aggregating not less than 25% of the Trust shall have
requested the Trustee in writing to institute such action, suit or
proceeding and shall have offered to the Trustee indemnity as provided in
Section 7.03(e);
(3) the Trustee shall have refused or neglected to institute such an
action, suit or proceeding for 60 days
50
-44-
after receipt of such notice, request and offer of indemnity; and
(4) no direction inconsistent with such written request shall have
been given to the Trustee during such 60-day period by Certificateholders
holding Certificates evidencing Fractional Undivided Interests aggregating
not less than a majority in interest in the Trust.
It is understood and intended that no one or more of the
Certificateholders shall have any right in any manner whatsoever hereunder or
under the Certificates to (i) surrender, impair, waive, affect, disturb or
prejudice any property in the Trust Property or the lien of any Indenture on any
property subject thereto, or the rights of the Certificateholders or the holders
of the Equipment Notes, (ii) obtain or seek to obtain priority over or
preference with respect to any other such Certificateholder or (iii) enforce any
right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all the Certificateholders subject to the
provisions of this Agreement.
Section 6.08. Remedies Cumulative. Every remedy given hereunder to
the Trustee or to any of the Certificateholders shall not be exclusive of any
other remedy or remedies, and every such remedy shall be cumulative and in
addition to every other remedy given hereunder or now or hereafter given by
statute, law, equity or otherwise.
ARTICLE VII
THE TRUSTEE
Section 7.01. Certain Duties and Responsibilities. (a) Except during
the continuance of an Event of Default, the Trustee undertakes to perform such
duties as are specifically set forth in this Agreement, and no implied covenants
or obligations shall be read into this Agreement against the Trustee.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of its
own affairs.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own wilful misconduct, except that
51
-45-
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section; and
(2) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer of the Trustee, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent facts.
(d) Whether or not herein expressly so provided, every provision of
this Trust Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
Section 7.02. Notice of Defaults. As promptly as practicable after,
and in any event within 90 days after, the occurrence of any default (as such
term is defined below) hereunder known to the Trustee, the Trustee shall
transmit by mail to the Company, the Loan Trustees, the Second Mortgagee and the
Certificateholders in accordance with Section 313(c) of the Trust Indenture Act,
notice of such default hereunder known to the Trustee, unless such default shall
have been cured or waived; provided, however, that, except in the case of a
default in the payment of the principal, premium, if any, or interest on any
Equipment Note held in the Trust, the Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive committee or
a trust committee of directors and/or Responsible Officers of the Trustee in
good faith determine that the withholding of such notice is in the interests of
the Certificateholders. For the purpose of this Section, the term "default"
means any event that is, or after notice or lapse of time or both would become,
an Event of Default.
Section 7.03. Certain Rights of Trustee. Subject to the provisions
of Section 315 of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting in reliance upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a written description of the subject matter
thereof accompanied by an Officer's Certificate and an Opinion of Counsel
as provided in Section 1.02 of this Agreement;
52
-46-
(c) whenever in the administration of this Agreement the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officer's Certificate of the Company,
any Loan Trustee or the Second Mortgagee;
(d) the Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement at the Direction of any of
the Certificateholders pursuant to this Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable security
or indemnity against the cost, expenses and liabilities which might be
incurred by it in compliance with such Direction;
(f) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture or other paper or document;
(g) the Trustee may execute any of the trusts or powers under this
Agreement or perform any duties under this Agreement either directly or by
or through agents or attorneys, and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it under this Agreement;
(h) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the
Direction of the Certificateholders holding Certificates evidencing
Fractional Undivided Interests aggregating not less than a majority in
interest in the Trust relating to the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Agreement; and
(i) the Trustee shall not be required to expend or risk its own
funds in the performance of any of its duties under this Agreement, or in
the exercise of any of its rights or powers, if it shall have reasonable
grounds for
53
-47-
believing that repayment of such funds or adequate indemnity against such
risk is not reasonably assured to it.
Section 7.04. Not Responsible for Recitals or Issuance of
Certificates. The recitals contained herein and in the Certificates, except the
certificates of authentication, shall not be taken as the statements of the
Trustee, and the Trustee assumes no responsibility for their correctness.
Subject to Section 7.15, the Trustee makes no representations as to the validity
or sufficiency of this Agreement, any Equipment Notes, the Intercreditor
Agreement, the Certificates or any other Financing Document, except that the
Trustee hereby represents and warrants that this Agreement has been, and the
Intercreditor Agreement, the Registration Rights Agreement and each Certificate
will be, executed, authenticated and delivered by one of its officers who is
duly authorized to execute, authenticate and deliver such document on its
behalf.
Section 7.05. May Hold Certificates. The Trustee, any Paying Agent,
Registrar or any of their Affiliates or any other agent in their respective
individual or any other capacity may become the owner or pledgee of Certificates
and, subject to Sections 310(b) and 311 of the Trust Indenture Act, if
applicable, may otherwise deal with the Company, the Loan Trustees or the Second
Mortgagee with the same rights it would have if it were not Trustee, Paying
Agent, Registrar or such other agent.
Section 7.06. Money Held in Trust. Money held by the Trustee or the
Paying Agent in trust hereunder need not be segregated from other funds except
to the extent required herein or by law and neither the Trustee nor the Paying
Agent shall have any liability for interest upon any such moneys except as
provided for herein.
Section 7.07. Compensation and Reimbursement. The Company agrees:
(1) to pay, or cause to be paid, to the Trustee from time to time
reasonable compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse, or
cause to be reimbursed, the Trustee upon its request for all reasonable
out-of-pocket expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Agreement (including the
reasonable compensation and the expenses and
54
-48-
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence, willful
misconduct or bad faith or as may be incurred due to the Trustee's breach
of its representations and warranties set forth in Section 7.15; and
(3) to indemnify the Trustee pursuant to Sections 8.1 and 8.3 of
each Financing Agreement.
The Trustee shall be entitled to reimbursement from, and shall have
a lien prior to the Certificates upon, the Trust Property for any tax incurred
without negligence, bad faith or willful misconduct, on its part, arising out of
or in connection with the acceptance or administration of such Trust (other than
any tax attributable to the Trustee's compensation for serving as such),
including any costs and expenses incurred in contesting the imposition of any
such tax. If the Trustee reimburses itself from the Trust Property of such Trust
for any such tax, it will mail a brief report within 30 days setting forth the
circumstances thereof to all Certificateholders as their names and addresses
appear in the Register.
Section 7.08. Corporate Trustee Required; Eligibility. There shall
at all times be a Trustee hereunder which shall be eligible to act as a trustee
under Section 310(a) of the Trust Indenture Act and shall have a combined
capital and surplus of at least $75,000,000 (or a combined capital and surplus
in excess of $5,000,000 and the obligations of which, whether now in existence
or hereafter incurred, are fully and unconditionally guaranteed by a corporation
organized and doing business under the laws of the United States, any state or
territory thereof or of the District of Columbia and having a combined capital
and surplus of at least $75,000,000). If such corporation publishes reports of
conditions at least annually, pursuant to law or to the requirements of federal,
state, territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section 7.08, the combined capital and surplus of
such corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of conditions so published.
In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 7.08 to act as Trustee, the
Trustee shall resign immediately as Trustee in the manner and with the effect
specified in Section 7.09.
Section 7.09. Resignation and Removal; Appointment of Successor. (a)
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall
55
-49-
become effective until the acceptance of appointment by the successor Trustee
under Section 7.10.
(b) The Trustee may resign at any time as trustee by giving prior
written notice thereof to the Company, the Authorized Agents, the Loan Trustees
and the Second Mortgagee. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Company, the Authorized Agents, the Loan
Trustees, the Trustee and the Second Mortgagee within 30 days after the giving
of such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Direction of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust
delivered to the Trustee and to the Company, the Loan Trustees and the Second
Mortgagee.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 310 of the Trust
Indenture Act, if applicable, after written request therefor by the
Company or by any Certificateholder who has been a bona fide
Certificateholder for at least six months; or
(2) the Trustee shall cease to be eligible under Section 7.08 and
shall fail to resign after written request therefor by the Company or by
any such Certificateholder; or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any case, (i) the Company may remove the Trustee or (ii) any
Certificateholder who has been a bona fide Certificateholder for at least six
months may, on behalf of itself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
(e) If a Responsible Officer of the Trustee shall obtain actual
knowledge of an Avoidable Tax which has been or is likely to be asserted, the
Trustee shall promptly notify the Company and shall, within 30 days of such
notification, resign hereunder unless within such 30-day period the Trustee
shall have
56
-50-
received notice that the Company has agreed to pay such tax. The Company shall
promptly appoint a successor Trustee in a jurisdiction where there are no
Avoidable Taxes.
(f) If the Trustee shall resign, be removed or become incapable of
acting or if a vacancy shall occur in the office of the Trustee for any cause,
the Company shall promptly appoint a successor Trustee. If, within one year
after such resignation, removal or incapability, or other occurrence of such
vacancy, a successor Trustee shall be appointed by Direction of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust
delivered to the Company, the Loan Trustees, the Second Mortgagee and the
retiring Trustee, and the Company approves such appointment, which approval
shall not be unreasonably withheld, then the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment, become the successor
Trustee and supersede the successor Trustee appointed as provided above. If no
successor Trustee shall have been so appointed as provided above and accepted
appointment in the manner hereinafter provided, any Certificateholder who has
been a bona fide Certificateholder for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee.
(g) The successor Trustee shall give notice of the resignation and
removal of the Trustee and appointment of the successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Certificateholders as their names and addresses appear in the Register. Each
notice shall include the name of such successor Trustee and the address of its
Corporate Trust Office.
Section 7.10. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute and deliver to the Company,
the Authorized Agents, the Loan Trustees and the Second Mortgagee and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on request of the Company or the successor Trustee, such retiring Trustee
shall execute and deliver an instrument transferring to such successor Trustee
all such rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all Trust Property held
by such retiring Trustee hereunder, subject nevertheless to its lien, if any,
provided for in Section 7.07. Upon request of any such successor
57
-51-
Trustee, the Company, the retiring Trustee and such successor Trustee shall
execute and deliver any and all instruments containing such provisions as shall
be necessary or desirable to transfer and confirm to, and for more fully and
certainly vesting in, such successor Trustee all such rights, powers and trusts.
No institution shall accept its appointment as a Trustee hereunder
unless at the time of such acceptance such institution shall be qualified and
eligible under this Article VII.
Section 7.11. Merger, Conversion, Consolidation or Succession to
Business. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article VII, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Certificates shall have been
executed or authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such execution or authentication and deliver the Certificates so
executed or authenticated with the same effect as if such successor Trustee had
itself executed or authenticated such Certificates.
Section 7.12. Maintenance of Agencies. (a) There shall at all times
be maintained an office or agency in the location set forth in Section 12.03
where Certificates may be presented or surrendered for registration of transfer
or for exchange, and for payment thereof and where notices and demands to or
upon the Trustee in respect of such certificates or this Agreement may be
served; provided, however, that, if it shall be necessary that the Trustee
maintain an office or agency in another location (e.g., the Certificates shall
be represented by Definitive Certificates and shall be listed on a national
securities exchange), the Trustee will make all reasonable efforts to establish
such an office or agency. Written notice of the location of each such other
office or agency and of any change of location thereof shall be given by the
Trustee to the Company, the Loan Trustees and the Second Mortgagee (at their
respective addresses specified in the Financing Documents or such other address
as may be notified to the Trustee) and the Certificateholders. In the event that
no such office or agency shall be maintained or no such notice of location or of
change of location shall be given, presentations and demands may be made
58
-52-
and notices may be served at the Corporate Trust Office of the Trustee.
(b) There shall at all times be a Registrar and a Paying Agent
hereunder with respect to the Certificates. Each such Authorized Agent shall be
a bank or trust company, shall be a corporation organized and doing business
under the laws of the United States or any state, with a combined capital and
surplus of at least $75,000,000, or, if the Trustee shall be acting as the
Registrar or Paying Agent hereunder, a corporation having a combined capital and
surplus in excess of $5,000,000, the obligations of which are guaranteed by a
corporation organized and doing business under the laws of the United States or
any state, with a combined capital and surplus of at least $75,000,000, and
shall be authorized under such laws to exercise corporate trust powers, subject
to supervision by Federal or state authorities. The Trustee shall initially be
the Paying Agent and, as provided in Section 3.04, Registrar hereunder with
respect to the Certificates. Each Registrar shall furnish to the Trustee, at
stated intervals of not more than six months, and at such other times as the
Trustee may request in writing, a copy of the Register maintained by such
Registrar.
(c) Any corporation into which any Authorized Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authorized Agent shall
be a party, or any corporation succeeding to the corporate trust business of any
Authorized Agent, shall be the successor of such Authorized Agent hereunder, if
such successor corporation is otherwise eligible under this Section, without the
execution or filing of any paper or any further act on the part of the parties
hereto or such Authorized Agent or such successor corporation.
(d) Any Authorized Agent may at any time resign by giving written
notice of resignation to the Trustee, the Company, the Loan Trustees and the
Second Mortgagee. The Company may, and at the request of the Trustee shall, at
any time terminate the agency of any Authorized Agent by giving written notice
of termination to such Authorized Agent and to the Trustee. Upon the resignation
or termination of an Authorized Agent or in case at any time any such Authorized
Agent shall cease to be eligible under this Section (when, in either case, no
other Authorized Agent performing the functions of such Authorized Agent shall
have been appointed), the Company shall promptly appoint one or more qualified
successor Authorized Agents, reasonably satisfactory to the Trustee, to perform
the functions of the Authorized Agent which has resigned or whose agency has
been terminated or who shall have ceased to be eligible under this Section. The
Company shall give written notice of any such
59
-53-
appointment made by it to the Trustee, the Loan Trustees and the Second
Mortgagee; and in each case the Trustee shall mail notice of such appointment to
all Certificateholders as their names and addresses appear on the Register.
(e) The Company agrees to pay, or cause to be paid, from time to
time to each Authorized Agent reasonable compensation for its services and to
reimburse it for its reasonable expenses.
Section 7.13. Money for Certificate Payments to Be Held in Trust.
All moneys deposited with any Paying Agent for the purpose of any payment on
Certificates shall be deposited and held in trust for the benefit of the
Certificateholders entitled to such payment, subject to the provisions of this
Section. Moneys so deposited and held in trust shall constitute a separate trust
fund for the benefit of the Certificateholders with respect to which such money
was deposited.
The Trustee may at any time, for the purpose of obtaining the
satisfaction and discharge of this Agreement or for any other purpose, direct
any Paying Agent to pay to the Trustee all sums held in trust by such Paying
Agent, such sums to be held by the Trustee upon the same trusts as those upon
which such sums were held by such Paying Agent; and, upon such payment by any
Paying Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Section 7.14. Registration of Equipment Notes in Name of
Subordination Agent. The Trustee agrees that all Equipment Notes to be purchased
by the Trust shall be issued in the name of the Subordination Agent or its
nominee and held by the Subordination Agent in trust for the benefit of the
Certificateholders, or, if not so held, the Subordination Agent or its nominee
shall be reflected as the owner of such Equipment Notes in the register of the
issuer of such Equipment Notes.
Section 7.15. Representations and Warranties of Trustee. The Trustee
hereby represents and warrants that:
(a) the Trustee is a Delaware banking corporation organized and
validly existing in good standing under the laws of the State of Delaware;
(b) the Trustee has full power, authority and legal right to
execute, deliver, and perform this Agreement, the Intercreditor Agreement,
the Registration Rights Agreement and the Financing Agreements and has
taken all necessary action to authorize the execution, delivery, and
performance
60
-54-
by it of this Agreement, the Intercreditor Agreement, the Registration
Rights Agreement and the Financing Agreements;
(c) the execution, delivery and performance by the Trustee of this
Agreement, the Intercreditor Agreement, the Registration Rights Agreement
and the Financing Agreements (i) will not violate any provision of United
States federal law or the law of the state of the United States where it
is located governing the banking and trust powers of the Trustee or any
order, writ, judgment, or decree of any court, arbitrator or governmental
authority applicable to the Trustee or any of its assets, (ii) will not
violate any provision of the articles of association or by-laws of the
Trustee, or (iii) will not violate any provision of, or constitute, with
or without notice or lapse of time, a default under, or result in the
creation or imposition of any lien on any properties included in the Trust
Property pursuant to the provisions of any mortgage, indenture, contract,
agreement or other undertaking to which it is a party, which violation,
default or lien could reasonably be expected to have an adverse effect on
the Trustee's performance or ability to perform its duties hereunder or
thereunder or on the transactions contemplated herein or therein;
(d) the execution, delivery and performance by the Trustee of this
Agreement, the Intercreditor Agreement, the Registration Rights Agreement
and the Financing Agreements will not require the authorization, consent,
or approval of, the giving of notice to, the filing or registration with,
or the taking of any other action in respect of, any governmental
authority or agency of the United States or the state of the United States
where it is located regulating the banking and corporate trust activities
of the Trustee; and
(e) this Agreement, the Intercreditor Agreement, the Registration
Rights Agreement and the Financing Agreements have been duly executed and
delivered by the Trustee and constitute the legal, valid, and binding
agreements of the Trustee, enforceable against it in accordance with their
respective terms, provided that enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the rights of creditors generally and (ii) general
principles of equity.
Section 7.16. Withholding Taxes, Information Reporting. The Trustee,
as trustee of the grantor trust created by this Agreement, shall exclude and
withhold from each
61
-55-
distribution of principal, premium, if any, and interest and other amounts due
under this Agreement or under the Certificates any and all withholding taxes
applicable thereto as required by law. The Trustee agrees to act as such
withholding agent and, in connection therewith, whenever any present or future
taxes or similar charges are required to be withheld with respect to any amounts
payable in respect of the Certificates, to withhold such amounts and timely pay
the same to the appropriate authority in the name of and on behalf of the
Certificateholders, that it will file any necessary withholding tax returns or
statements when due, and that, as promptly as possible after the payment
thereof, it will deliver to each such Certificateholder appropriate
documentation showing the payment thereof, together with such additional
documentary evidence as such Certificateholders may reasonably request from time
to time. The Trustee agrees to file any other information reports as it may be
required to file under United States law.
Section 7.17. Trustee's Liens. The Trustee in its individual
capacity agrees that it will at its own cost and expense promptly take any
action as may be necessary to duly discharge and satisfy in full any mortgage,
pledge, lien, charge, encumbrance, security interest or claim ("Trustee's
Liens") on or with respect to the Trust Property which is attributable to the
Trustee either (i) in its individual capacity and which is unrelated to the
transactions contemplated by this Agreement, the Intercreditor Agreement, the
Financing Agreements or the Financing Documents, or (ii) as Trustee hereunder or
in its individual capacity and which arises out of acts or omissions which are
not contemplated by this Agreement.
Section 7.18. Preferential Collection of Claims. The Trustee shall
comply with Section 311(a) of the Trust Indenture Act, excluding any creditor
relationship listed in Section 311(b) of the Trust Indenture Act. If the Trustee
shall resign or be removed as Trustee, it shall be subject to Section 311(a) of
the Trust Indenture Act to the extent provided therein.
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE
Section 8.01. The Company to Furnish Trustee with Names and
Addresses of Certificateholders. The Company will furnish to the Trustee within
15 days after each Record Date with respect to a Scheduled Payment, and at such
other times as the Trustee may request in writing within 30 days after receipt
by the Company of any such request, a list, in such form as the Trustee may
reasonably require, of all information in the possession or control of the
Company as to the names and
62
-56-
addresses of the Certificateholders, in each case as of a date not more than 15
days prior to the time such list is furnished; provided, however, that so long
as the Trustee is the sole Registrar, no such list need be furnished; and
provided further, however, that no such list need be furnished for so long as a
copy of the Register is being furnished to the Trustee pursuant to Section 7.12.
Section 8.02. Preservation of Information; Communications to
Certificateholders. The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Certificateholders contained
in the most recent list furnished to the Trustee as provided in Section 7.12 or
Section 8.01, as the case may be, and the names and addresses of
Certificateholders received by the Trustee in its capacity as Registrar, if so
acting. The Trustee may destroy any list furnished to it as provided in Section
7.12 or Section 8.01, as the case may be, upon receipt of a new list so
furnished.
Section 8.03. Reports by Trustee. Within 60 days after May 15 of
each year commencing with the first full year following the issuance of the
Certificates, the Trustee shall transmit to the Certificateholders, as provided
in Section 313(c) of the Trust Indenture Act, a brief report dated as of such
May 15, if required by Section 313(a) of the Trust Indenture Act.
Section 8.04. Reports by the Company. The Company shall:
(a) file with the Trustee, within 30 days after the Company is
required to file the same with the SEC, copies of the annual reports and
of the information, documents and other reports (or copies of such
portions of any of the foregoing as the SEC may from time to time by rules
and regulations prescribe) which the Company is required to file with the
SEC pursuant to section 13 or section 15(d) of the Securities Exchange Act
of 1934, as amended; or, if the Company is not required to file
information, documents or reports pursuant to either of such sections,
then to file with the Trustee and the SEC, in accordance with rules and
regulations prescribed by the SEC, such of the supplementary and periodic
information, documents and reports which may be required pursuant to
section 13 of the Securities Exchange Act of 1934, as amended, in respect
of a security listed and registered on a national securities exchange as
may be prescribed in such rules and regulations;
(b) during any period, prior to the consummation of the Exchange
Offer and during which the Shelf Registration Statement is not in effect,
in which the Company is not
63
-57-
subject to Section 13(a), 13(c) or 15(d) under the Securities Exchange Act
of 1934, make available to any Holder of the Certificates in connection
with any sale thereof and any prospective purchaser of the Certificates
from such Holder, in each case upon request, the information specified in,
and meeting the requirements of, Rule 144A(d)(4) under the Securities Act
but only for so long as any of the Certificates remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act and, in any event, only until the second anniversary of the
Issuance Date;
(c) file with the Trustee and the SEC, in accordance with the rules
and regulations prescribed by the SEC, such additional information,
documents and reports with respect to compliance by the Company with the
conditions and covenants provided for in this Agreement, as may be
required by such rules and regulations, including, in the case of annual
reports, if required by such rules and regulations, certificates or
opinions of independent public accountants, conforming to the requirements
of Section 1.02;
(d) transmit to all Certificateholders, in the manner and to the
extent provided in Section 313(c) of the Trust Indenture Act such
summaries of any information, documents and reports required to be filed
by the Company pursuant to subsections (a) and (c) of this Section 8.04 as
may be required by rules and regulations prescribed by the SEC; and
(e) furnish to the Trustee, not less often than annually, a brief
certificate from the principal executive officer, principal financial
officer or principal accounting officer as to his or her knowledge of the
Company's compliance with all conditions and covenants under this
Agreement (it being understood that for purposes of this paragraph (e),
such compliance shall be determined without regard to any period of grace
or requirement of notice provided under this Agreement).
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
Section 9.01. Supplemental Agreements Without Consent of
Certificateholders. Without the consent of the Certificateholders, the Company
may (but will not be required to), and the Trustee (subject to Section 9.03)
shall, at the Company's request, at any time and from time to time, enter into
one or more agreements supplemental hereto or, if applicable, to the
Intercreditor Agreement, the Registration Rights Agreement or
64
-58-
the Liquidity Facility in form satisfactory to the Trustee, for any of the
following purposes:
(1) to evidence the succession of another corporation to the Company
and the assumption by any such successor of the covenants of the Company
herein contained or of the Company's obligations under the Registration
Rights Agreement or the Liquidity Facility; or
(2) to add to the covenants of the Company for the benefit of the
Certificateholders, or to surrender any right or power conferred upon the
Company in this Agreement, the Registration Rights Agreement or the
Liquidity Facility; or
(3) to correct or supplement any provision in this Agreement, the
Intercreditor Agreement, the Registration Rights Agreement or the
Liquidity Facility which may be defective or inconsistent with any other
provision herein or therein or to cure any ambiguity or correct any
mistake or to modify any other provision with respect to matters or
questions arising under this Agreement, the Intercreditor Agreement, the
Registration Rights Agreement or the Liquidity Facility, provided that any
such action shall not materially adversely affect the interests of the
Certificateholders; or, as provided in the Intercreditor Agreement, to
give effect to or provide for a Replacement Liquidity Facility (as defined
in the Intercreditor Agreement); or
(4) to comply with any requirement of the SEC, any applicable law,
rules or regulations of any exchange or quotation system on which the
Certificates are listed, any regulatory body or the Registration Rights
Agreement to effectuate the Exchange Offer; or
(5) to modify, eliminate or add to the provisions of this Agreement
to such extent as shall be necessary to continue the qualification of this
Agreement (including any supplemental agreement) under the Trust Indenture
Act or under any similar Federal statute hereafter enacted, and to add to
this Agreement such other provisions as may be expressly permitted by the
Trust Indenture Act, excluding, however, the provisions referred to in
Section 316(a)(2) of the Trust Indenture Act as in effect at the date as
of which this instrument was executed or any corresponding provision in
any similar Federal statute hereafter enacted; or
(6) to evidence and provide for the acceptance of appointment under
this Agreement by the Trustee of a successor Trustee and to add to or
change any of the
65
-59-
provisions of this Agreement as shall be necessary to provide for or
facilitate the administration of the Trust, pursuant to the requirements
of Section 7.10; or
(7) to provide the information required under Section 7.12 and
Section 12.03 as to the Trustee; or
(8) to modify or eliminate provisions relating to the transfer or
exchange of Exchange Certificates or the Initial Certificates upon
consummation of the Exchange Offer (as defined in the Registration Rights
Agreement) or effectiveness of the Shelf Registration Statement or the
Exchange Offer Registration Statement;
provided, however, that no such supplemental agreement shall adversely affect
the status of any Trust as a grantor trust under Subpart E, Part I of Subchapter
J of Chapter 1 of Subtitle A of the Internal Revenue Code of 1986, as amended,
for U.S. federal income tax purposes.
Section 9.02. Supplemental Agreements with Consent of
Certificateholders. With the consent of the Certificateholders holding
Certificates (including consents obtained in connection with a tender offer or
exchange offer for the Certificates) evidencing Fractional Undivided Interests
aggregating not less than a majority in interest in the Trust, by Direction of
said Certificateholders delivered to the Company and the Trustee, the Company
may (but shall not be obligated to), and the Trustee (subject to Section 9.03)
shall enter into an agreement or agreements for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement, the Intercreditor Agreement, the Liquidity Facility, the
Registration Rights Agreement or any Financing Agreement to the extent
applicable to such Certificateholders or of modifying in any manner the rights
and obligations of such Certificateholders under this Agreement, the
Intercreditor Agreement, the Liquidity Facility or the Registration Rights
Agreement; provided, however, that no such agreement shall, without the consent
of the Certificateholder of each Outstanding Certificate affected thereby:
(1) reduce in any manner the amount of, or delay the timing of, any
receipt by the Trustee of payments on the Equipment Notes held in the
Trust or distributions that are required to be made herein on any
Certificate, or change any date of payment on any Certificate, or change
the place of payment where, or the coin or currency in which, any
Certificate is payable, or impair the right to institute suit for the
enforcement of any such payment or distribution
66
-60-
on or after the Regular Distribution Date or Special Distribution Date
applicable thereto; or
(2) permit the disposition of any Equipment Note included in the
Trust Property except as permitted by this Agreement, or otherwise deprive
such Certificateholder of the benefit of the ownership of the Equipment
Notes in the Trust; or
(3) reduce the specified percentage of the aggregate Fractional
Undivided Interests of the Trust which is required for any such
supplemental agreement, or reduce such specified percentage required for
any waiver of compliance with certain provisions of this Agreement or
certain defaults hereunder and their consequences provided for in this
Agreement; or
(4) waive, amend or modify Section 2.4, 3.2 or 3.3 of the
Intercreditor Agreement in a manner adverse to the Certificateholders; or
(5) modify any of the provisions of this Section 9.02 or Section
6.05, except to increase any such percentage or to provide that certain
other provisions of this Agreement cannot be modified or waived without
the consent of the Certificateholder of each Certificate affected thereby;
or
(6) adversely affect the status of any Trust as a grantor trust
under Subpart E, Part I of Subchapter J of Chapter 1 of Subtitle A of the
Internal Revenue Code of 1986, as amended, for U.S. federal income tax
purposes.
It shall not be necessary for any Direction of Certificateholders
under this Section to approve the particular form of any proposed supplemental
agreement, but it shall be sufficient if such Direction shall approve the
substance thereof.
Section 9.03. Documents Affecting Immunity or Indemnity. If in the
opinion of the Trustee any document required to be executed by it pursuant to
the terms of Section 9.01 or 9.02 affects any interest, right, duty, immunity or
indemnity in favor of the Trustee under this Agreement, the Trustee may in its
discretion decline to execute such document.
Section 9.04. Execution of Supplemental Agreements. In executing, or
accepting the additional trusts created by, any agreement permitted by this
Article or the modifications thereby of the trusts created by this Agreement,
the Trustee shall be entitled to receive, and shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
67
-61-
supplemental agreement is authorized or permitted by this Agreement.
Section 9.05. Effect of Supplemental Agreements. Upon the execution
of any agreement supplemental to this Agreement under this Article, this
Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of a Certificate theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 9.06. Conformity with Trust Indenture Act. Every
supplemental agreement executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.
Section 9.07. Reference in Certificates to Supplemental Agreements.
Certificates authenticated and delivered after the execution of any supplemental
agreement pursuant to this Article may bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental agreement; and, in
such case, suitable notation may be made upon Outstanding Certificates after
proper presentation and demand.
ARTICLE X
AMENDMENTS TO INDENTURES AND FINANCING DOCUMENTS
Section 10.01. Amendments and Supplements to Indentures and
Financing Documents. In the event that the Trustee, as holder (or beneficial
owner through the Subordination Agent) of any Equipment Note (or as prospective
purchaser of any Postponed Notes) in trust for the benefit of the
Certificateholders or as Controlling Party under the Intercreditor Agreement,
receives (directly or indirectly through the Subordination Agent) a request for
a consent to any amendment, modification, waiver or supplement under any
Equipment Note, any Financing Document related thereto or any other related
document, the Trustee shall forthwith send a notice of such proposed amendment,
modification, waiver or supplement to each Certificateholder registered on the
Register as of the date of such notice. The Trustee shall request from the
Certificateholders a Direction as to (a) whether or not to take or refrain from
taking (or direct the Subordination Agent to take or refrain from taking) any
action which a holder of (or, with respect to Postponed Notes, a prospective
purchaser of) such Equipment Note has the option to direct, (b) whether or not
to give or execute (or direct the Subordination Agent to give or execute) any
waivers, consents, amendments, modifications or supplements as a holder of (or,
with respect to Postponed Notes, a prospective purchaser of) such
68
-62-
Equipment Note or a Controlling Party and (c) how to vote (or direct the
Subordination Agent to vote) any Equipment Note (or, with respect to Postponed
Note, its commitment to acquire such Postponed Note) if a vote has been called
for with respect thereto. Provided such a request for Certificateholder
Direction shall have been made, in directing any action or casting any vote or
giving any consent as the holder of any Equipment Note (or in directing the
Subordination Agent in any of the foregoing), (i) other than as Controlling
Party, the Trustee shall vote for or give consent to any such action with
respect to such Equipment Note (or Postponed Note) in the same proportion as
that of (A) the aggregate face amounts of all Certificates actually voted in
favor of or for giving consent to such action by such Direction of
Certificateholders to (B) the aggregate face amount of all Outstanding
Certificates and (ii) as Controlling Party, the Trustee shall vote as directed
in such Certificateholder Direction by the Certificateholders evidencing a
Fractional Undivided Interest aggregating not less than a majority in interest
in the Trust. For purposes of the immediately preceding sentence, a Certificate
shall have been "actually voted" if the Holder of such Certificate has delivered
to the Trustee an instrument evidencing such Holder's consent to such Direction
prior to two Business Days before the Trustee directs such action or casts such
vote or gives such consent. Notwithstanding the foregoing, but subject to
Section 6.04 and the Intercreditor Agreement, the Trustee may, in its own
discretion and at its own direction, consent and notify the relevant Loan
Trustee and/or the Second Mortgagee, as the case may be, of such consent (or
direct the Subordination Agent to consent and notify the relevant Loan Trustee
and/or the Second Mortgagee, as the case may be, of such consent) to any
amendment, modification, waiver or supplement under any Equipment Note (or
Postponed Note), any Financing Document related thereto or any other related
document, if an Event of Default hereunder shall have occurred and be
continuing, or if such amendment, modification, waiver or supplement will not
materially adversely affect the interests of the Certificateholders.
ARTICLE XI
TERMINATION OF TRUST
Section 11.01. Termination of the Trust. The respective obligations
and responsibilities of the Company and the Trustee with respect to the Trust
shall terminate upon the distribution to all Holders of Certificates and the
Trustee of all amounts required to be distributed to them pursuant to this
Agreement and the disposition of all property held as part of the Trust
Property; provided, however, that in no event shall the
69
-63-
Trust continue beyond one hundred ten (110) years following the date of the
execution of this Trust Agreement.
Notice of such termination, specifying the Distribution Date upon
which the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be mailed promptly by
the Trustee to Certificateholders not earlier than the 60th day and not later
than the 20th day next preceding such final Distribution Date specifying (A) the
Distribution Date upon which the proposed final payment of the Certificates will
be made upon presentation and surrender of Certificates at the office or agency
of the Trustee therein specified, (B) the amount of any such proposed final
payment, and (C) that the Record Date otherwise applicable to such Distribution
Date is not applicable, payments being made only upon presentation and surrender
of the Certificates at the office or agency of the Trustee therein specified.
The Trustee shall give such notice to the Registrar at the time such notice is
given to Certificateholders. Upon presentation and surrender of the Certificates
in accordance with such notice, the Trustee shall cause to be distributed to
Certificateholders such final payments.
In the event that all of the Certificateholders shall not surrender
their Certificates for cancellation within six months after the date specified
in the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. No
additional interest shall accrue on the Certificates after the Distribution Date
specified in the first written notice. In the event that any money held by the
Trustee for the payment of distributions on the Certificates shall remain
unclaimed for two years (or such lesser time as the Trustee shall be satisfied,
after sixty days' notice from the Company, is one month prior to the escheat
period provided under applicable law) after the final distribution date with
respect thereto, the Trustee shall pay to each Loan Trustee the appropriate
amount of money relating to such Loan Trustee and shall give written notice
thereof to the Company.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any
70
-64-
action or commence any proceeding in any court for a partition or winding up of
the Trust, nor otherwise affect the rights, obligations, and liabilities of the
parties hereto or any of them.
Section 12.02. Certificates Nonassessable and Fully Paid. Except as
set forth in the last sentence of this Section 12.02, Certificateholders shall
not be personally liable for obligations of the Trust, the Fractional Undivided
Interests represented by the Certificates shall be nonassessable for any losses
or expenses of the Trust or for any reason whatsoever, and Certificates, upon
authentication thereof by the Trustee pursuant to Section 3.03, are and shall be
deemed fully paid. No Certificateholder shall have any right (except as
expressly provided herein) to vote or in any manner otherwise control the
operation and management of the Trust Property, the Trust, or the obligations of
the parties hereto, nor shall anything set forth herein, or contained in the
terms of the Certificates, be construed so as to constitute the
Certificateholders from time to time as partners or members of an association.
Neither the existence of the Trust nor any provision herein is intended to or
shall limit the liability the Certificateholders would otherwise incur if the
Certificateholders owned Trust Property as co-owners, or incurred any
obligations of the Trust, directly rather than through the Trust.
Section 12.03. Notices. (a) Unless otherwise specifically provided
herein, all notices required under the terms and provisions of this Agreement
shall be in English and in writing, and any such notice may be given by United
States mail, courier service or telecopy, and any such notice shall be effective
when delivered or received or, if mailed, three days after deposit in the United
States mail with proper postage for ordinary mail prepaid,
if to the Company, to:
Continental Airlines, Inc.
0000 Xxxxx Xxxxxxx
Xxxxxxx, XX 00000
Attention: Chief Financial Officer and
General Counsel
Facsimile: (000) 000-0000
71
-65-
if to the Trustee, to:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Corporate Trust Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(b) The Company or the Trustee, by notice to the other, may
designate additional or different addresses for subsequent notices or
communications.
(c) Any notice or communication to Certificateholders shall be
mailed by first-class mail to the addresses for Certificateholders shown on the
Register kept by the Registrar. Failure so to mail a notice or communication or
any defect in such notice or communication shall not affect its sufficiency with
respect to other Certificateholders.
(d) If a notice or communication is mailed in the manner provided
above within the time prescribed, it is conclusively presumed to have been duly
given, whether or not the addressee receives it.
(e) If the Company mails a notice or communication to the
Certificateholders, it shall mail a copy to the Trustee and to the Paying Agent
at the same time.
(f) Notwithstanding the foregoing, all communications or notices to
the Trustee shall be deemed to be given only when received by a Responsible
Officer of the Trustee.
(g) The Trustee shall promptly furnish the Company with a copy of
any demand, notice or written communication received by the Trustee hereunder
from any Certificateholder, any Loan Trustee or the Second Mortgagee.
Section 12.04. Governing Law. THIS AGREEMENT HAS BEEN DELIVERED IN
THE STATE OF NEW YORK AND THIS AGREEMENT AND THE CERTIFICATES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Section 12.05. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions, or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or
72
-66-
terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or the Trust, or of the
Certificates or the rights of the Certificateholders thereof.
Section 12.06. Trust Indenture Act Controls. Upon the occurrence of
any Registration Event, this Agreement shall become subject to the provisions of
the Trust Indenture Act and shall, to the extent applicable, be governed by such
provisions. From and after any Registration Event, if any provision of this
Agreement limits, qualifies or conflicts with another provision which is
required to be included in this Agreement by the Trust Indenture Act, the
required provision shall control.
Section 12.07. Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
Section 12.08. Successors and Assigns. All covenants, agreements,
representations and warranties in this Agreement by the Trustee and the Company
shall bind and, to the extent permitted hereby, shall inure to the benefit of
and be enforceable by their respective successors and assigns, whether so
expressed or not.
Section 12.09. Benefits of Agreement. Nothing in this Agreement or
in the Certificates, express or implied, shall give to any Person, other than
the parties hereto and their successors hereunder, and the Certificateholders,
any benefit or any legal or equitable right, remedy or claim under this
Agreement.
Section 12.10. Legal Holidays. In any case where any Regular
Distribution Date or Special Distribution Date relating to any Certificate shall
not be a Business Day, then (notwithstanding any other provision of this
Agreement) payment need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on such
Regular Distribution Date or Special Distribution Date, and no interest shall
accrue during the intervening period.
Section 12.11. Counterparts. For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
Section 12.12. Intention of Parties. The parties hereto intend that
the Trust be classified for U.S. federal
73
-67-
income tax purposes as a grantor trust under Subpart E, Part I of Subchapter J
of the Internal Revenue Code of 1986, as amended, and not as a trust or
association taxable as a corporation or as a partnership. The powers granted and
obligations undertaken pursuant to this Agreement shall be so construed so as to
further such intent.
74
-68-
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first written above.
CONTINENTAL AIRLINES, INC.
By: __________________________
Name: Xxxxxx Xxxxxxxx
Title: Vice President
WILMINGTON TRUST COMPANY,
as Trustee
By: __________________________
Name:
Title:
75
-69-
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first written above.
CONTINENTAL AIRLINES, INC.
By: ___________________________
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By: __________________________
Name:
Title:
76
EXHIBIT A
FORM OF CERTIFICATE
REGISTERED
No._________
[THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY
ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
CERTIFICATE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S
UNDER THE SECURITIES ACT; (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS
AFTER THE LATER OF THE ORIGINAL ISSUANCE OF THIS CERTIFICATE OR THE LAST
DATE ON WHICH THIS CERTIFICATE WAS HELD BY CONTINENTAL AIRLINES, INC., THE
TRUSTEE OR ANY AFFILIATE OF ANY OF SUCH PERSONS RESELL OR OTHERWISE
TRANSFER THIS CERTIFICATE EXCEPT (A) TO CONTINENTAL AIRLINES, INC., (B) TO
A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION
IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT; AND (3) AGREES THAT IF IT SHOULD RESELL OR
OTHERWISE TRANSFER THIS CERTIFICATE IT WILL DELIVER TO EACH PERSON TO WHOM
THIS CERTIFICATE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS CERTIFICATE WITHIN
TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE OF THIS CERTIFICATE OR
THE LAST DATE ON WHICH THIS CERTIFICATE WAS HELD BY CONTINENTAL AIRLINES,
INC., THE TRUSTEE OR ANY AFFILIATE OF ANY OF SUCH PERSONS, THE HOLDER MUST
CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE
MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION", "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT. THE PASS THROUGH TRUST AGREEMENT CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
77
A-2
THIS CERTIFICATE IN VIOLATION OF THE FOREGOING RESTRICTIONS.]*
BY ITS ACQUISITION HEREOF, THE HOLDER REPRESENTS THAT (A) IT IS NOT A PLAN
TRANSFEREE (AS DEFINED IN THE PASS THROUGH TRUST AGREEMENT) OR (B) IT IS
AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT TO ACQUIRE
THIS CERTIFICATE, AND THE CONDITIONS OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 ISSUED BY THE U.S. DEPARTMENT OF LABOR HAVE BEEN AND WILL
CONTINUE TO BE SATISFIED IN CONNECTION WITH ITS PURCHASE AND HOLDING OF
THIS CERTIFICATE. THE PASS THROUGH TRUST AGREEMENT CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS
CERTIFICATE IN VIOLATION OF THE FOREGOING RESTRICTIONS.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 3.05 AND 3.06 OF THE PASS THROUGH TRUST
AGREEMENT REFERRED TO HEREIN.]**
----------
* Not to be included on the face of the Regulation S Global
Certificate.
** To be included on the face of each Global Certificate.
78
A-3
[[REGULATION S] GLOBAL CERTIFICATE]*
CONTINENTAL AIRLINES PASS THROUGH TRUST, SERIES 1997-2D
7.522% Continental Airlines [Initial] [Exchange]
Pass Through Certificate,
Series 1997-2D
Final Maturity Date: June 30, 2001
CUSIP/Common Code No. ____________
evidencing a fractional undivided interest in a trust, the property of which
includes certain equipment notes each secured by an Aircraft owned by
Continental Airlines, Inc.
$27,369,000 Fractional Undivided Interest representing
.003653769% of the Trust per $1,000 face amount
THIS CERTIFIES THAT _______________, for value received, is the
registered owner of a $________ (__________dollars) Fractional Undivided
Interest in the Continental Airlines Pass Through Trust, Series 1997-2D (the
"Trust") created pursuant to a Pass Through Trust Agreement, dated as of June
25, 1997 (the "Agreement"), between Wilmington Trust Company (the "Trustee") and
Continental Airlines, Inc., a corporation incorporated under Delaware law (the
"Company"), a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in the Agreement. This
Certificate is one of the duly authorized Certificates designated as "7.522%
Continental Airlines [Initial] [Exchange] Pass Through Certificates, Series
1997-2D" (herein called the "Certificates"). This Certificate is issued under
and is subject to the terms, provisions, and conditions of the Agreement. By
virtue of its acceptance hereof the Certificateholder of this Certificate
assents to and agrees to be bound by the provisions of the Agreement and the
Intercreditor Agreement. The property of the Trust includes an interest in
certain Equipment Notes and all rights of the Trust to receive payments under
the Intercreditor Agreement and the Liquidity Facility (the "Trust Property").
Each issue of the Equipment Notes is secured by, among other things, a security
interest in the Aircraft owned by the Company.
----------
* To be included on the face of each Global Certificate.
79
A-4
The Certificates represent fractional undivided interests in the
Trust and the Trust Property, and have no rights, benefits or interest in
respect of any assets or property other than the Trust Property.
Subject to and in accordance with the terms of the Agreement and the
Intercreditor Agreement, from and to the extent of funds then available to the
Trustee, there will be distributed on each June 30 and December 30 (a "Regular
Distribution Date"), commencing on December 30, 1997, to the Person in whose
name this Certificate is registered at the close of business on the 15th day
preceding the Regular Distribution Date, an amount in respect of the Scheduled
Payments due on such Regular Distribution Date on the Equipment Notes, the
receipt of which has been confirmed by the Trustee, equal to the product of the
percentage interest in the Trust evidenced by this Certificate and an amount
equal to the sum of such Scheduled Payments. Subject to and in accordance with
the terms of the Agreement and the Intercreditor Agreement, in the event that
Special Payments on the Equipment Notes are received by the Trustee, from funds
then available to the Trustee, there shall be distributed on the applicable
Special Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee, equal
to the product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular Distribution Date or Special Distribution Date is not a Business
Day, distribution shall be made on the immediately following Business Day with
the same force and effect as if made on such Regular Distribution Date or
Special Distribution Date and no interest shall accrue during the intervening
period. The Trustee shall mail notice of each Special Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.
The Certificates do not represent a direct obligation of, or an
obligation guaranteed by, or an interest in, the Company or the Trustee or any
of their affiliates. The Certificates are limited in right or payment, all as
more specifically set forth on the face hereof and in the Agreement. All
payments or distributions made to Certificateholders under the Agreement shall
be made only from the Trust Property and only to the extent that the Trustee
shall have sufficient income or proceeds from the Trust Property to make such
payments in accordance with the terms of the Agreement. Each Certificateholder
of this Certificate, by its acceptance hereof, agrees that it will look solely
to the income and proceeds from the Trust Property to the extent available for
distribution to
80
A-5
such Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement for
information with respect to the interests, rights, benefits, obligations,
proceeds, and duties evidenced hereby. A copy of the Agreement may be examined
during normal business hours at the principal office of the Trustee, and at such
other places, if any, designated by the Trustee, by any Certificateholder upon
request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Agreement at any time
by the Company and the Trustee with the consent of the Certificateholders
holding Certificates evidencing Fractional Undivided Interests aggregating not
less than a majority in interest in the Trust. Any such consent by the
Certificateholder of this Certificate shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any Certificate issued upon the transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Certificateholders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee in its capacity as Registrar, or
by any successor Registrar, in the Borough of Manhattan, the City of New York,
duly endorsed or accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Registrar duly executed by the
Certificateholder hereof or such Certificateholder's attorney duly authorized in
writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate Fractional Undivided Interest in the Trust will be
issued to the designated transferee or transferees.
[The Holder of this Certificate is entitled to the benefits of the
Exchange and Registration Rights Agreement, dated as of June 25, 1997, among the
Company, the Trustee and the Initial Purchasers named therein (the "Registration
Rights Agreement"). In the event that no Registration Event has occurred on or
prior to the 210th day after the date of the issuance of the Certificates, the
interest rate per annum payable in respect of the Equipment Notes shall be
increased by 0.50%, from and including the 210th day after the Issuance Date to
but excluding the earlier of (i) the date on which a Registration
81
A-6
Event occurs and (ii) the date on which there cease to be any Registrable
Certificates (as defined in the Registration Rights Agreement). In the event
that the Shelf Registration Statement (if it is filed), after being declared
effective by the SEC, ceases to be effective at any time during the period
specified by Section 2(b)(B) of the Registration Rights Agreement for more than
60 days, whether or not consecutive, during any 12-month period, the interest
rate per annum payable in respect of the Equipment Notes shall be increased by
0.50% from the 61st day of the applicable 12-month period such Shelf
Registration Statement ceases to be effective until such time as the Shelf
Registration Statement again becomes effective ( or, if earlier, the end of the
period specified by Section 2(b)(B) of the Registration Rights Agreement).]*
Except as otherwise provided in the Agreement and notwithstanding
the above, the final distribution on this Certificate will be made after notice
mailed by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency of the
Trustee specified in such notice.
The Certificates are issuable only as registered Certificates
without coupons in minimum denominations of
----------
* To be included only on each Initial Certificate.
82
A-7
[$100,000]** [$1,000]*** Fractional Undivided Interest and integral
multiples of $1,000 in excess thereof except that one Certificate may be in a
different denomination. As provided in the Agreement and subject to certain
limitations therein set forth, the Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee shall require payment by the Holder of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
The Trustee, the Registrar, and any agent of the Trustee or the
Registrar may treat the person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither the Trustee, the Registrar, nor
any such agent shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and
the Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them pursuant to
the Agreement and the disposition of all property held as part of the Trust
Property.
THIS CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
----------
** To be included only on each Initial Certificate.
*** To be included only on each Exchange Certificte.
83
A-8
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: _______________, 1997 CONTINENTAL AIRLINES
PASS THROUGH TRUST, SERIES
1997-2D
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Trustee
By: _________________________________
Name:
Title:
84
A-9
[FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Certificates referred
to in the within-mentioned Agreement.
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Trustee
By: ______________________________
Authorized Officer
85
A-10
FORM OF TRANSFER NOTICE
FOR VALUE RECEIVED the
undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
___________________________________
___________________________________
please print or typewrite name and address including zip code of assignee
___________________________________
the within Certificate and all rights thereunder, hereby irrevocably
constituting and appointing
___________________________________
attorney to transfer said Certificate on the books of the Trustee with full
power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL CERTIFICATES
EXCEPT REGULATION S GLOBAL AND
REGULATION S DEFINITIVE CERTIFICATES]
In connection with any
transfer of this Certificate occurring prior to the date that is the earlier of
the date of an effective Registration Statement or the date two years after the
later of the original issuance of this Certificate or the last date on which
this Certificate was held by Continental Airlines, Inc., the Trustee or any
affiliate of such Persons, the undersigned confirms that without utilizing any
general solicitation or general advertising that:
[Check One]
[ ] (a) this Certificate is being transferred in compliance with the exemption
from registration under the Securities Act of 1933, as amended, provided by Rule
144A thereunder.
or
86
A-11
[ ] (b) this Certificate is being transferred other than in accordance with (a)
above and documents are being furnished that comply with the conditions of
transfer set forth in this Certificate and the Agreement.
If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Certificate in the name of any Person
other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 3.06 of the Agreement
shall have been satisfied.
Date:__________________ [Name of Transferor]
------------------------------------
NOTE: The signature must correspond
with the name as written upon the face
of the within-mentioned instrument in
every particular, without alteration
or any change whatsoever.
Signature Guarantee: ______________________
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Certificate for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Dated:__________________ _____________________________
NOTE: To be executed by an
executive officer.
87
EXHIBIT B
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS OF CERTIFICATES PURSUANT TO REGULATION S
[date]
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Corporate Trust Trustee Administration
Re: Continental Airlines Pass Through Trust (the "Trust"), Series
1997-2D, Continental Airlines Pass Through Certificates, Series
1997-2D (the "Certificates")
Sirs:
In connection with our proposed sale of $_____ Fractional Undivided
Interest of the Certificates, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended, and, accordingly, we represent that:
(1) the offer of the Certificates was not made to a person in the
United States;
(2) either (a) at the time the buy order was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the United
States or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
In addition, if the sale is made during a restricted period and the
provisions of Rule 903(c)(3) or Rule 904(c)(1) of Regulation S are applicable
thereto, we confirm that such sale has been made in accordance with the
applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case may be.
You and Continental Airlines, Inc. are entitled to rely upon this
letter and are irrevocably authorized to produce this
88
B-2
letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby.
Terms used in this certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
89
SCHEDULE I
Aircraft
Aircraft Type Registration Number
------------- -------------------
Boeing 737-3T0 N12322
Boeing 737-3T0 N10323
Boeing 737-3T0 N14324
Boeing 737-3T0 N69333
Boeing 737-3T0 N14334
Boeing 737-3T0 X00000
XxXxxxxxx Xxxxxxx MD-82 N12811
XxXxxxxxx Xxxxxxx MD-82 N15820
XxXxxxxxx Xxxxxxx MD-82 N18833
XxXxxxxxx Xxxxxxx MD-82 N10834
