PLACEMENT AGREEMENT
July 17, 1997
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Salomon Brothers Inc
0 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
Amtran, Inc., an Indiana corporation (the "Company"), proposes
to issue and sell to Xxxxxx Xxxxxxx & Co. Incorporated and Salomon Brothers Inc
(collectively, the "Placement Agents") $100,000,000 aggregate principal amount
of its 10.5% Senior Notes due 2004 (the "Securities") to be issued pursuant to
the provisions of an Indenture dated as of July 24, 1997 (the "Indenture") among
the Company, as issuer, American Trans Air, Inc. ("ATA"), Ambassadair Travel
Club, Inc., ATA Vacations, Inc., Amber Travel, Inc., American Trans Air Training
Corporation, American Trans Air Execujet, Inc. and Amber Air Freight Corporation
(each, an Indiana corporation), as guarantors (together, the "Guarantors"), and
First Security Bank, N.A., as trustee (the "Trustee"). Pursuant to the terms of
the Indenture the Guarantors will guarantee (each, a "Guarantee") on a joint and
several basis the obligations of the Company under the Securities and the
Indenture.
The Securities will be offered without being registered under
the Securities Act of 1933, as amended (the "Securities Act"), to "qualified
institutional buyers" (as defined in Rule 144A under the Securities Act) in
compliance with the exemption from registration provided by Rule 144A under the
Securities Act ("Rule 144A"), in offshore transactions in reliance on Regulation
S under the Securities Act ("Regulation S") and to institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act) that, prior to their purchase of Securities, deliver to the Placement
Agents a letter in the form annexed to the Final Memorandum (as defined below).
The Placement Agents and their direct and indirect transferees
will be entitled to the benefits of a registration rights agreement (the
"Registration Rights Agreement"), to be
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dated the Closing Date (as defined below) and to be substantially in the form
attached hereto as Exhibit A.
In connection with the sale of the Securities, the Company has
prepared a preliminary private placement memorandum (the "Preliminary
Memorandum") and will prepare a final private placement memorandum (the "Final
Memorandum" and, with the Preliminary Memorandum, each a "Memorandum") setting
forth or including a description of the terms of the Securities, the terms of
the offering and a description of the Company and its business.
1. Representations and Warranties. Each of the Guarantors and
the Company represents and warrants to, and agrees with, the Placement Agents
that as of the date hereof:
(a) The Final Memorandum, in the form used by the Placement
Agents to confirm sales and on the Closing Date (as defined below),
will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this
Section 1(a) do not apply to statements or omissions in either
Memorandum based upon information relating to any Placement Agent
furnished to the Company or any Guarantor in writing by such Placement
Agent through you expressly for use therein.
(b) None of the Guarantors, the Company nor any affiliate (as
defined in Rule 501(b) of Regulation D under the Securities Act, an
"Affiliate") of the Guarantors or the Company has directly, or through
any agent, (i) sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any security (as defined in the
Securities Act) which is or will be integrated with the sale of the
Securities in a manner that would require the registration under the
Securities Act of the Securities or (ii) engaged in any form of general
solicitation or general advertising in connection with the offering of
the Securities (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act except that no
representation is made as to the activities of the Placement Agents.
(c) None of the Guarantors, the Company, their Affiliates nor
any person acting on its or their behalf (other than the Placement
Agents) has engaged in any directed selling efforts (as that term is
defined in Regulation S) with respect to the Securities and each of the
Guarantors, the Company and its Affiliates and any person acting on its
or their behalf (other than the Placement Agents) have complied with
the offering restrictions requirement of Regulation S.
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(d) The Company is subject to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended.
(e) Assuming the accuracy of the representations and
warranties of the Placement Agents in Section 6 and the compliance by
them with their agreements in Section 6, it is not necessary in
connection with the offer, sale and delivery of the Securities and the
Guarantees to the Placement Agents in the manner contemplated by this
Agreement to register the Securities or Guarantees under the Securities
Act or to qualify the Indenture under the Trust Indenture Act of 1939,
as amended, except as provided in the Registration Rights Agreement.
(f) The Securities satisfy the eligibility requirements of
Rule 144A(d)(3) under the Securities Act.
(g) Neither the Company nor any of the Guarantors is required
to register as an "investment company" and, after giving effect to the
offer, issuance and delivery of the Securities to you in accordance
with the terms of this Agreement and the application of the proceeds
thereof as described in the Final Memorandum, neither the Company nor
any of the Guarantors will be required to register as an "investment
company" under the Investment Company Act of 1940, as amended (the
"Investment Company Act").
(h) The accountants that examined and issued an auditors
report with respect to the consolidated financial statements of the
Company and its consolidated subsidiaries included in the Final
Memorandum are independent public accountants within the meaning of the
Securities Act and the regulations thereunder.
(i) This Agreement has been duly authorized, executed and
delivered by each of the Guarantors and the Company.
(j) The consolidated financial statements included in the
Final Memorandum present fairly the consolidated financial position of
the Company and its consolidated subsidiaries as of the dates indicated
and the consolidated results of operations and cash flows or changes in
financial position of the Company and its consolidated subsidiaries for
the periods specified. Such financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved. The financial
statement schedules, if any, included in the Final Memorandum present
fairly the information required to be stated therein.
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(k) Each of the Guarantors and the Company is a corporation
duly organized, validly existing and in good standing under the laws of
the State of Indiana with power and authority (corporate and other)
under such laws to own, lease and operate its properties and conduct
its business as described in the Final Memorandum and to perform its
obligations under this Agreement, the Registration Rights Agreement,
the Indenture, the Securities (in the case of the Company) and the
Guarantees (in the case of the Guarantors); and each of the Guarantors
and the Company is duly qualified to transact business as a foreign
corporation and is in good standing in each other jurisdiction in which
it owns or leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except to the
extent that the failure to so qualify or be in good standing would not
have a material adverse effect on the condition (financial or other),
business, prospects or results of operations of the Company and the
Guarantors, taken as a whole (a "Material Adverse Effect").
(l) The Securities have been duly authorized and, when
executed, authenticated and delivered to and paid for by the Placement
Agents in accordance with the terms of this Agreement, will be (x)
valid and binding obligations of the Company enforceable in accordance
with their terms, except as (A) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (B) rights of acceleration, if applicable, and the
availability of equitable remedies may be limited by equitable
principles of general applicability, and (y) be entitled to the
benefits of the Indenture and the Registration Rights Agreement.
(m) The Guarantees have been duly authorized by each of the
Guarantors and, upon execution and delivery of the Indenture by each of
the Guarantors and the Company, will be (x) valid and binding
obligations of the each of the Guarantors enforceable in accordance
with their terms, except as (A) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (B) rights of acceleration, if applicable, and the
availability of equitable remedies may be limited by equitable
principles of general applicability, and (y) be entitled to the
benefits of the Indenture and the Registration Rights Agreement.
(n) Each of the Indenture and the Registration Rights
Agreement has been duly authorized, executed and delivered by, and is a
valid and binding agreement of, the Company and each of the Guarantors,
enforceable in accordance with their terms except as the enforceability
thereof, except as (A) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws relating to or affecting
creditors' rights generally, (B) rights of acceleration, if applicable,
and the availability of equitable remedies may be limited by equitable
principles of general applicability and
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(C) the rights to indemnification or contribution may be limited by
applicable law and public policy.
(o) ATA is a "citizen of the United States" (as defined in
Section 40102(a)(15) of Title 49 of the United States Code, as amended)
and is an air carrier operating under a certificate issued by the
Secretary of Transportation pursuant to Chapter 447 of Title 49, United
States Code, for aircraft capable of carrying 10 or more individuals or
6,000 pounds or more of cargo. There is in force with respect to ATA an
air carrier operating certificate issued pursuant to Part 121 of the
regulations under the sections of Xxxxx 00, Xxxxxx Xxxxxx Code,
relating to aviation (the "Federal Aviation Act"). All of the
outstanding shares of capital stock of each of the Guarantors have been
duly authorized and validly issued and are fully paid and
non-assessable and are owned by the Company, free and clear of any
pledge, lien, security interest, charge, claim, equity or encumbrance
of any kind.
(p) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Guarantors and the Company taken as a whole, from
that set forth in the Final Memorandum.
(q) Except as described in the Final Memorandum, none of the
Guarantors or the Company is in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument to which it is a party or by
which they may be bound or to which any of their properties may be
subject, except for such defaults that would not have a Material
Adverse Effect.
(r) The execution and delivery by each of the Guarantors and
the Company of this Agreement, the Registration Rights Agreement, the
Indenture, the Securities (in the case of the Company) and the
Guarantees (in the case of the Guarantors) (collectively, the
"Operative Documents"), the consummation by each of the Guarantors and
the Company of the transactions contemplated in this Agreement and the
Operative Documents and compliance by each of the Guarantors and the
Company with the terms of this Agreement and the Operative Documents
will not contravene (i) any provision of applicable law or the articles
of incorporation or by-laws of the Guarantors or the Company, as the
case may be, (ii) any agreement or other instrument binding upon the
Guarantors or the Company or (iii) any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Guarantors or the Company other than, in the case of clauses (ii) and
(iii) above, such contraventions that would not individually or in the
aggregate have a Material Adverse Effect, and no consent, approval,
authorization or order of, or qualification with, any governmental
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body or agency is required for the valid authorization, execution,
delivery and performance by each of the Guarantors and the Company of
this Agreement or the consummation by the Guarantors or the Company of
the transactions contemplated by this Agreement and the Operative
Documents, the consummation by each of the Guarantors and the Company
of the transactions contemplated in this Agreement and the Operative
Documents, except such as may be required by the securities or Blue
Sky laws of the various states in connection with the offer and sale
of the Securities and the Guarantees.
(s) There are no legal or governmental proceedings pending or
threatened to which the Company or any of the Guarantors is a party, or
to which any of the properties of the Company or any of the Guarantors
is subject, other than proceedings accurately described in all material
respects in the Final Memorandum and proceedings that would not have a
Material Adverse Effect, or a material adverse effect on the power or
ability of any of the Guarantors or the Company to perform their
respective obligations under this Agreement or any of the Operative
Documents, or to consummate the transactions contemplated by the Final
Memorandum.
(t) The Company and each of the Guarantors possess adequate
certificates, authorities and permits issued by appropriate
governmental agencies or bodies necessary to conduct, in all material
respects, the business now operated by them and have not received any
notice of proceedings relating to the revocation or modification of any
such certificate, authority or permit that reasonably would be likely
to, individually or in the aggregate, have a Material Adverse Effect.
(u) Except as disclosed in the Final Memorandum, no labor
dispute with the employees of the Company or any of the Guarantors
exists or to the knowledge of the Company or any of the Guarantors is
imminent that might have a Material Adverse Effect.
(v) Except as disclosed in the Final Memorandum, the Company
and each of the Guarantors (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment
or hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (iii) are in compliance with
all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals would not, singly or in the aggregate, have a Material
Adverse Effect.
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(w) Except as disclosed in the Final Memorandum, each of the
Guarantors and the Company have good and marketable title to all real
properties and all other properties and assets owned by them, in each
case free from liens, encumbrances and defects except where the failure
to have such title would not have a Material Adverse Effect; and except
as disclosed in the Final Memorandum, each of the Guarantors and the
Company hold any leased real or personal property under valid and
enforceable leases with no exceptions that would have a Material
Adverse Effect.
The representations and warranties contained in this Agreement
shall be true and correct as of the date of this Agreement and as of the Closing
Date.
2. Offering.
You have advised the Company and the Guarantors that the
Placement Agents will make an offering of the Securities received and paid for
by the Placement Agents hereunder on the terms set forth in the Final Memorandum
as soon as practicable after this Agreement is entered into as in your judgment
is advisable.
3. Issuance and Delivery.
(a) The Company hereby agrees to sell to the Placement Agents,
and the Placement Agents, upon the basis of the representations and warranties
herein contained, but subject to the conditions hereinafter stated, agree,
severally and not jointly, to purchase from the Company the respective principal
amount of Securities set forth in Schedule I hereto opposite their names at a
purchase price of 97% of the principal amount thereof.
(b) Payment for the Securities shall be made against delivery
of the Securities at a closing (the "Closing") to be held at the office of
Shearman & Sterling at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00
A.M., local time, on July 22, 1997, or at such other time on the same or such
other date, not later than August 2, 1997, as shall be agreed upon by the
Company and you. The time and date of such payment are herein referred to as the
Closing Date. Delivery of the Securities shall be made to your account at The
Depository Trust Company against payment by the Placement Agents of the purchase
price thereof by wire transfer in immediately available funds.
(c) Certificates for the Securities shall be in global or
definitive form and registered in such names and in such denominations as you
shall request in writing not less than two full business days prior to the
Closing Date. The certificates evidencing the Securities shall be delivered to
you on the Closing Date for the respective account of each Placement Agent, with
any transfer taxes payable in connection with the transfer of the Securities to
the Placement Agents duly paid, against payment of the purchase price therefor.
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4. Conditions to Closing. The several obligations of the
Placement Agents under this Agreement to purchase the Securities will be subject
to the following conditions:
(a) Subsequent to the date of this Agreement and prior to the
Closing Date,
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any securities
of any of the Guarantors or the Company by any "nationally recognized
statistical rating organization," as such term is defined for purposes
of Rule 436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition, financial
or otherwise, or in the earnings, business or operations, of the
Company and the Guarantors, taken as a whole, from that set forth in
the Preliminary Memorandum that, in your judgment, is material and
adverse and that makes it, in your judgment, impracticable to market
the Securities on the terms and in the manner contemplated in the Final
Memorandum.
(b) You shall have received on the Closing Date (i) a
certificate, dated the Closing Date and signed by an executive officer of the
Company and (ii) a certificate, dated the Closing Date and signed by an
executive officer of each Guarantor, in each case, to the effect set forth in
clause (a)(i) above and to the effect that the representations and warranties of
the Company and the Guarantors contained in this Agreement are true and correct
as of the Closing Date and that the Company and each of the Guarantors have
complied with all of the agreements and satisfied all of the conditions on their
part to be performed or satisfied on or before the Closing Date.
The officers signing and delivering such certificates may rely
upon the best of their knowledge as to proceedings threatened.
(c) You shall have received on the Closing Date an opinion of
Cravath, Swaine & Xxxxx, independent counsel for the Company, dated the Closing
Date, to the effect set forth in Exhibit B.
(d) You shall have received on the Closing Date an opinion of
the General Counsel of the Guarantor(s) and the Company, dated the Closing Date,
to the effect set forth in Exhibit C.
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(e) You shall have received on the Closing Date an opinion of
Shearman & Sterling, counsel for the Placement Agents, dated the Closing Date,
in form and substance satisfactory to you.
(f) You shall have received on each of the date hereof and the
Closing Date a letter, dated the date hereof or the Closing Date, as the case
may be, in form and substance satisfactory to you, from the Guarantors' and the
Company's independent public accountants, containing statements and information
of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Final Memorandum.
(g) Each of the Guarantors and the Company shall have
furnished to you and to counsel for the Placement Agents, in form and substance
satisfactory to you and to them, such other documents, certificates and opinions
as such counsel may reasonably request in order to pass upon the matters
referred to in Section 4(e) and in order to evidence the accuracy and
completeness of any of the representations, warranties or statements, the
performance of any covenant by any of the Guarantors or the Company theretofore
to be performed, or the compliance with any of the conditions herein contained.
(h) On or before the Closing Date, the agreement covering the
New Credit Facility, as such term is defined in the Offering Memorandum, shall
have been entered into substantially in the form heretofore delivered to you,
and shall be in full force and effect.
5. Covenants of the Company. In further consideration of the
agreements of the Placement Agents contained in this Agreement, the Company and
each of the Guarantors covenant as follows:
(a) To furnish to you, without charge, during the period
mentioned in paragraph (c) below, as many copies of the Final
Memorandum and any supplements and amendments thereto as you may
reasonably request and to deliver such copies to you by 8:00 a.m. (New
York time) on the second business day following the execution of this
Agreement.
(b) Before amending or supplementing either Memorandum, to
furnish to you a copy of each such proposed amendment or supplement and
not to use any such proposed amendment or supplement to which you
reasonably object.
(c) If, during such period after the date hereof and prior to
the date on which all of the Securities shall have been sold by the
Placement Agents, any event shall occur or condition exist as a result
of which it is necessary in your judgment to amend or supplement the
Final Memorandum in order to make the statements therein,
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in the light of the circumstances when such Memorandum is delivered to
a purchaser, not misleading, or if, with the opinion of counsel to the
Placement Agents it is necessary to amend or supplement such
Memorandum to comply with applicable law, forthwith to prepare and
furnish, at its own expense, to the Placement Agents, either
amendments or supplements to such Memorandum so that the statements in
such Memorandum as so amended or supplemented will not, in the light
of the circumstances when such Memorandum is delivered to a purchaser,
be misleading or so that such Memorandum, as so amended or
supplemented, will comply with applicable law.
(d) So long as any of the Securities are "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities
Act, at any time when the Company is not subject to Section 13 or 15(d)
of the Exchange Act, each of the Guarantors and the Company will
provide to any holder of such restricted securities, or to any
prospective purchaser of such restricted securities designated by a
holder, upon the request of such holder or prospective purchaser, any
information required to be delivered to holders and prospective
purchasers of the Securities pursuant to Rule 144A(d)(4) under the
Securities Act.
(e) To endeavor to qualify the Securities and the Guarantees
for offer and sale under the applicable securities or Blue Sky laws of
such jurisdictions as you shall reasonably request.
(f) For a period of five years after the Closing Date, the
Guarantors and the Company will make available to the Placement Agents
copies of all annual reports, quarterly reports and current reports
filed by the Company with the Securities and Exchange Commission (the
"Commission") on Forms 10-K, 10-Q and 8-K, or such other similar forms
as may be designated by the Commission, and such other documents,
reports and information as shall be furnished by the Company to the
holders of the Securities or the Guarantors to their security holders
generally; provided that at such time the Company has securities
registered under Section 12(b) or 12(g) of the Exchange Act.
(g) During the period of two years after the Closing Date,
each of the Guarantors and the Company will, upon request, furnish to
the Placement Agents and any holder of the Securities a copy of the
restrictions on transfer applicable to the Securities.
(h) During the period of two years after the Closing Date,
none of the Guarantors or the Company will, and none of the Guarantors
or the Company will
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permit any of their affiliates (as defined in Rule 144 under the
Securities Act) to, resell any of the Securities that have been
reacquired by any of them.
(i) During the period of two years after the Closing Date,
none of the Guarantors or the Company will be or become an open-end
investment company, unit investment trust or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act, or a closed-end investment company required to
be registered, but not registered, under the Investment Company Act.
(j) Whether or not any sale of such Securities is consummated,
to pay all expenses incident to the performance of its obligations
under this Agreement, including: (i) the preparation of each Memorandum
and all amendments and supplements thereto, (ii) the preparation,
issuance and delivery of the Securities, (iii) the fees and
disbursements of the Company's counsel and accountants and the Trustee
and its counsel, (iv) the qualification of such Securities under
securities or Blue Sky laws in accordance with the provisions of
Section 5(e), including filing fees and the fees and disbursements of
counsel for the Placement Agents in connection therewith and in
connection with the preparation of any Blue Sky or legal investment
memoranda, (v) the printing and delivery to the Placement Agents in
quantities as hereinabove stated of copies of each Memorandum and any
amendments or supplements thereto, (vi) any fees charged by rating
agencies for the rating of such Securities, (vii) all reasonable fees
and expenses of counsel to the Placement Agents (including their fees
for professional services) in connection with the preparation of this
Agreement, (viii) the fees and expenses, if any, incurred in connection
with the admission of such Securities for trading in PORTAL or in any
other appropriate market system, (ix) the costs and expenses of the
Company and the Guarantors relating to investor presentations on any
"road show" undertaken in connection with the marketing of the
Securities, including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with
the prior approval of the Company or any of the Guarantors, travel and
lodging expense of the representatives and officers of the Company and
the Guarantors and any such consultants, and the cost of any aircraft
chartered in connection with the road show, and (x) all other costs nd
expenses incident to the performance of the obligations of the Company
and the Guarantors hereunder for which provision is not otherwise made
in this Section.
(k) In connection with the offering, until the Placement
Agents shall have notified the Guarantors and the Company of the
completion of the resale of the Securities, neither the Company, any
Guarantor nor any of their affiliates has bid for or purchased or will
bid for or purchase, either alone or with one or more other persons,
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for any account in which they or any of their affiliates have a
beneficial interest in any Securities, and neither they nor any of
their affiliates will make bids or purchases for the purpose of
creating actual, or apparent, active trading in, or of raising the
price of, the Securities, in either case in violation of Regulation M
under the Exchange Act.
(l) Between the date of this Agreement and the Closing Date,
none of the Guarantors or the Company will without your prior written
consent offer, sell, or enter into any agreement to sell, any public
debt securities registered under the Securities Act or any debt
securities which may be resold in a transaction exempt from the
registration requirements of the Securities Act in reliance on Rule
144A thereunder and which are marketed through the use of a disclosure
document containing substantially the same information as a prospectus
for similar debt securities registered under the Securities Act (other
than the Securities).
(m) Not to solicit any offer to buy or offer or sell the
Securities by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act.
(n) If requested by you, to use its reasonable efforts to
permit the Securities to be designated PORTAL securities in accordance
with the rules and regulations adopted by the National Association of
Securities Dealers, Inc. relating to trading in the PORTAL Market.
(o) None of the Company, the Guarantors, their Affiliates or
any person acting on its or their behalf (other than the Placement
Agents) will engage in any directed selling efforts (as that term is
defined in Regulation S) with respect to the Securities, and the
Company, each of the Guarantors and their Affiliates and each person
acting on its or their behalf (other than the Placement Agents) will
comply with the offering restrictions of Regulation S.
(p) Neither the Company, any Guarantor nor any Affiliate will
sell, offer for sale or solicit offers to buy or otherwise negotiate in
respect of any security (as defined in the Securities Act) which could
be integrated with the sale of the Securities in a manner which would
require the registration under the Securities Act.
6. Offering of Securities; Restrictions on Transfer. (a) Each
Placement Agent, severally and not jointly, represents and warrants that such
Placement Agent is a qualified institutional buyer as defined in Rule 144A under
the Securities Act (a "QIB"). Each Placement Agent, severally and not jointly,
agrees with the Company that (i) it has not and will not solicit offers for, and
has not offered or sold and will not offer or sell, such Securities
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by any form of general solicitation or general advertising (as those terms are
used in Regulation D under the Securities Act) or in any manner involving a
public offering within the meaning of Section 4(2) of the Securities Act and
(ii) it has and will solicit offers for such Securities only from, and has
offered and will offer such Securities only to, persons that it reasonably
believes to be (A) in the case of offers inside the United States, (x) QIBs or
(y) other institutional accredited investors (as defined in Rule 501(a) (1),
(2), (3) or (7) under the Securities Act) ("institutional accredited investors")
that, prior to their purchase of the Securities, deliver to such Placement Agent
a letter containing the representations and agreements set forth in Appendix A
to the Memorandum and (B) in the case of offers outside the United States, to
persons other than U.S. persons ("foreign purchasers", which term shall include
dealers or other professional fiduciaries in the United States acting on a
discretionary basis for foreign beneficial owners (other than an estate or
trust)) that, in each case, in purchasing such Securities are deemed to have
represented and agreed as provided in the Final Memorandum under the caption
"Transfer Restrictions."
(b) Each Placement Agent, severally and not jointly,
represents, warrants, and agrees with respect to offers and sales outside the
United States that:
(i) it understands that no action has been or will be taken in
any jurisdiction by any Guarantor or the Company that would permit a
public offering of the Securities, or possession or distribution of
either Memorandum or any other offering or publicity material relating
to the Securities, in any country or jurisdiction where action for that
purpose is required;
(ii) such Placement Agent will comply with all applicable laws
and regulations in each jurisdiction in which it acquires, offers,
sells or delivers Securities or has in its possession or distributes
either Memorandum or any such other material, in all cases at its own
expense;
(iii) the Securities have not been and will not be registered
under the Securities Act and may not be offered or sold within the
United States or to, or for the account or benefit of, U.S. persons
except in accordance with Regulation S or pursuant to an exemption from
the registration requirements of the Securities Act;
(iv) such Placement Agent has offered the Securities and will
offer and sell the Securities (A) as part of their distribution at any
time and (B) otherwise until 40 days after the later of the
commencement of the offering of the Securities and the Closing Date,
only in accordance with Rule 903 of Regulation S or another exemption
from the registration requirements of the Securities Act. Accordingly,
neither such Placement Agent, its Affiliates nor any persons acting on
its or their behalf have engaged or will engage in any directed selling
efforts (within the meaning of
14
Regulation S) with respect to the Securities, and any such Placement
Agent, its Affiliates and any such persons have complied and will
comply with the offering restrictions requirements of Regulation S;
(v) such Placement Agent has (A) not offered or sold and,
during the period of six months from the Closing Date, will not offer
or sell any Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulations 1995 (the "Regulations"); (B) complied and will comply with
all applicable provisions of the Financial Services Xxx 0000 and the
Regulations with respect to anything done by it in relation to the
Securities in, from or otherwise involving the United Kingdom; and (C)
only issued or passed on and will only issue or pass on to any person
in the United Kingdom any document received by it in connection with
the issue of the Securities if that person is of a kind described in
Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such
document may otherwise lawfully be issued or passed on;
(vi) such Placement Agent understands that the Securities have
not been and will not be registered under the Securities and Exchange
Law of Japan, and represents that it has not offered or sold, and
agrees that it will not offer or sell, any Securities, directly or
indirectly in Japan or to any resident of Japan except (A) pursuant to
an exemption from the registration requirements of the Securities and
Exchange Law of Japan and (B) in compliance with any other applicable
requirements of Japanese law; and
(vii) such Placement Agent agrees that, at or prior to
confirmation of sales of the Securities, it will have sent to each
distributor, dealer or person receiving a selling concession, fee or
other remuneration that purchases Securities from it during the
restricted period a confirmation or notice to substantially the
following effect:
"The Securities covered hereby have not been
registered under the U.S. Securities Act of 1933 (the
"Securities Act") and may not be offered and sold within
the United States or to, or for the account or benefit of,
U.S. persons (i) as part of their distribution at any time
or (ii) otherwise until 40 days after the later of the
commencement of the offering and the closing date, except
in either case in accordance with Regulation S (or Rule
144A if available) under the Securities Act. Terms used
above have the meanings given to them by Regulation S."
15
Terms used in this Section 6 have the meaning given to them by Regulation S of
the Securities Act.
7. Indemnification and Contribution. (a) Each of the Company
and each Guarantor, jointly and severally, agrees to indemnify and hold harmless
each Placement Agent, and each person, if any, who controls such Placement Agent
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, or is under common control with, or is controlled by, such
Placement Agent, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred by any Placement Agent or any such controlling of affiliated
person in connection with defending or investigating any such action or claim)
caused by any untrue statement or alleged untrue statement of a material fact
contained in either Memorandum (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact necessary to make the
statements therein in light of the circumstances under which they were made not
misleading, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to any Placement Agent furnished to any
Guarantor or the Company in writing by such Placement Agent through you
expressly for use therein; provided however, that the foregoing indemnity
agreement with respect to any Preliminary Memorandum shall not inure to the
benefit of any Placement Agent from whom the person asserting any such losses,
claims, damages or liabilities purchased Securities, or any person controlling
such Placement Agent, if a copy of the Final Memorandum (as then amended or
supplemented if any Guarantor or the Company shall have furnished any amendments
or supplements thereto) was not sent or given by or on behalf of such Placement
Agent to such person, if required by law so to have been delivered, at or prior
to the written confirmation of the sale of the Securities to such person, and if
the Final Memorandum (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities, unless such failure
is the result of noncompliance by any Guarantor or the Company with Section 5(a)
hereof.
(b) Each Placement Agent agrees, severally and not jointly, to
indemnify and hold harmless each Guarantor and the Company, their directors,
their officers and each person, if any, who controls the Company or any
Guarantor within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the foregoing indemnity
from each Guarantor and the Company to such Placement Agent, but only with
reference to information relating to such Placement Agent furnished to any
Guarantor or the Company in writing by such Placement Agent through you
expressly for use in either Memorandum or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to
16
either paragraph (a) or (b) above, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by Xxxxxx Xxxxxxx &
Co. Incorporated, in the case of parties indemnified pursuant to paragraph (a)
above, and by the Guarantors and the Company in the case of parties indemnified
pursuant to paragraph (b) above. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) To the extent the indemnification provided for in
paragraph (a) or (b) of this Section 7 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities
17
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Guarantors and the Company, on the one hand, and the Placement
Agents, on the other hand, from the offering of such Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Guarantors
and the Company on the one hand and the Placement Agents on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Guarantors and the Company
on the one hand and the Placement Agents on the other hand in connection with
the offering of such Securities shall be deemed to be in the same respective
proportions as the net proceeds from the offering of such Securities (before
deducting expenses) received by the Guarantors and the Company and the total
discounts and commissions received by the Placement Agents in respect thereof
bear to the aggregate offering price of such Securities. The relative fault of
the Guarantors and the Company on the one hand and of the Placement Agents on
the other hand shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by any
Guarantor or the Company or by the Placement Agents and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Placement Agents' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective principal amount of Securities they have purchased hereunder, and not
joint.
(e) The Guarantors, the Company and the Placement Agents agree
that it would not be just or equitable if contribution pursuant to this Section
7 were determined by pro rata allocation (even if the Placement Agents were
treated as one entity for such purpose) or by any other method of allocation
that does not take account of the equitable considerations referred to in
paragraph (d) above. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in paragraph
(d) above shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Placement Agent shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities resold by it in the initial placement of such
Securities were offered to investors exceeds the amount of any damages that such
Placement Agent has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution provisions contained in
this Section 7 and the representations and warranties of the Guarantors and the
Company contained in this
18
Agreement shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation
made by or on behalf of the Placement Agents or any person controlling
the Placement Agents or by or on behalf of any Guarantor or the Company,
their officers or directors or any person controlling any Guarantor or
the Company and (iii) acceptance of and payment for any of the Securities. The
remedies provided for in this Section 7 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified party
at law or in equity.
8. Termination. This Agreement shall be subject to termination
in your absolute discretion, by notice given by you to the Company, if (a) after
the execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, the New York Stock Exchange, the American Stock Exchange, or
the National Association of Securities Dealers, Inc., (ii) trading of any
securities of any Guarantor or the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in your judgment, is material and adverse and (b) in
the case of any of the events specified in clauses (a)(i) through (iv), such
event singly or together with any other such event makes it, in your judgment,
impracticable to market the Securities on the terms and in the manner
contemplated in the Final Memorandum.
9. Miscellaneous. (a) If, on the Closing Date, either
Placement Agent shall fail or refuse to purchase Securities that it has agreed
to purchase hereunder on such date, and the aggregate principal amount of
Securities which such defaulting Placement Agent agreed but failed or refused to
purchase is not more than one-tenth of the aggregate principal amount of
Securities to be purchased on such date, the other Placement Agent shall be
obligated to purchase the Securities which such defaulting Placement Agent
agreed but failed or refused to purchase on such date; provided that in no event
shall the principal amount of Securities that any Placement Agent has agreed to
purchase pursuant to Section 3 be increased pursuant to this Section 9 by an
amount in excess of one-ninth of such principal amount of Securities without the
written consent of such Placement Agent. If, on the Closing Date either
Placement Agent shall fail or refuse to purchase Securities which it agreed to
purchase hereunder on such date and the aggregate principal amount of Securities
with respect to which such default occurs is more than one-tenth of the
aggregate principal amount of Securities to be purchased on such date and
arrangements satisfactory to you and the Company for the purchase of such
Securities are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Placement Agent,
the Company or any Guarantor. In any such case either you or the Company shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Final Memorandum
or in any other documents or
19
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Placement Agent from liability in respect of any default
of such Placement Agent under this Agreement.
(b) This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
(c) If this Agreement shall be terminated by either Placement
Agent because of any failure or refusal on the part of any Guarantor or the
Company to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason any Guarantor or the Company shall be unable to
perform its obligations under this Agreement, the Guarantors and the Company
will reimburse the Placement Agents or such Placement Agent as has so terminated
this Agreement with respect to itself, severally, for all out-of-pocket expenses
(including the reasonable fees and disbursements of their counsel) reasonably
incurred by such Placement Agent in connection with this Agreement or the
offering contemplated hereunder.
(d) All notices and other communications under this Agreement
shall be in writing, and, if sent the Placement Agents, be mailed, delivered or
sent by facsimile transmission to:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: High Yield New Issue Group
Facsimile Number: (000) 000-0000
and to:
Salomon Brothers Inc
Seven Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxx
Facsimile Number: (212) 783 - 2043
or, if sent to the Company or the Guarantors, will be mailed, delivered or sent
by facsimile transmission to the Company at:
with a copy to:
Amtran, Inc. Cravath, Swaine & Xxxxx
20
0000 Xxxx Xxxxxxxxxx Xxxxxx Worldwide Plaza, 000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000 Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxx, Esq. Attention: Xxxxxxx X. Xxxxxx, Xx., Esq.
Facsimile Number: (000) 000-0000 Facsimile Number: (000) 000-0000
(e) This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
(f) The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
Please confirm your agreement to the foregoing by signing in
the space provided below for that purpose and returning to us a copy hereof,
whereupon this Agreement shall constitute a binding agreement between us.
Very truly yours,
AMTRAN, INC.
By: __________________________
Name:
Title:
AMERICAN TRANS AIR, INC.
By: __________________________
Name:
Title:
AMBASSADAIR TRAVEL CLUB, INC.
By: __________________________
Name:
Title:
ATA VACATIONS, INC.
By: __________________________
Name:
Title:
AMBER TRAVEL, INC.
By: __________________________
Name:
Title:
AMERICAN TRANS AIR TRAINING
CORPORATION
By: __________________________
Name:
Title:
AMERICAN TRANS AIR EXECUJET, INC.
By: __________________________
Name:
Title:
AMBER AIR FREIGHT CORPORATION
By: __________________________
Name:
Title:
Accepted as of the date first
above written:
XXXXXX XXXXXXX & CO.
INCORPORATED
SALOMON BROTHERS INC
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
_____________________________________
Name:
Title:
SCHEDULE I
Principal Amount of
Securities
Placement Agent To Be Purchased
--------------- -------------------
Xxxxxx Xxxxxxx & Co. Incorporated 66,666,667
Salomon Brothers Inc 33,333,333
----------
Total............... $100,000,000
============
EXHIBIT A
Form of Registration Rights Agreement
EXHIBIT B
Form of Opinion of
Cravath, Swaine & Xxxxx
(i) No authorization, approval or other action by, and no
notice to, consent of, order of, or filing with, any United States Federal, New
York or, to the extent required under the General Corporation Law of the State
of Delaware, governmental authority or regulatory body is required for the
consummation of the transactions contemplated by the Placement Agreement, except
such as may be required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the Securities by the Placement
Agents;
(ii) (A) The statements in the Final Memorandum under the
captions "Description of the Notes" and "Description of the New Credit
Facility", insofar as such statements purport to summarize provisions of the
Securities and the New Credit Facility, respectively, fairly summarize such
provisions, and (B) the statements in the Final Memorandum under the caption
"Certain United States Federal Income Tax Consequences", insofar as they purport
to describe the material tax consequences of an investment in the Securities,
fairly summarize the matters therein described;
(iii) Assuming (i) the accuracy of the representations and
warranties of the Company, each of the Guarantors and you set forth in the
Placement Agreement, (ii) the due performance by the Company, each of the
Guarantors and you, of the covenants and agreements set forth in the Placement
Agreement, (iii) your compliance with the offering and transfer procedures and
restrictions described in the Final Memorandum and (iv) the accuracy of the
representations and warranties made in accordance with the Placement Agreement
and the Final Memorandum by purchasers to whom you initially resell the
Securities, the offer, sale and delivery of the Securities to you in the manner
contemplated by the Placement Agreement and the Final Memorandum and the initial
resale of the Securities by you in the manner contemplated in the Final
Memorandum and the Placement Agreement, do not require registration under the
Securities Act of 1933, as amended, and the Indenture does not require
qualification under the Trust Indenture Act of 1939, as amended, it being
understood that no opinion is expressed as to any subsequent resale of any
Securities;
(iv) Neither the Company nor any of the Guarantors is required
to register as an "investment company" and, after giving effect to the offer,
issuance and delivery of the Securities in accordance with the terms of the
Placement Agreement and the application of the proceeds thereof as described in
the Final Memorandum, neither the Company nor any of the Guarantors will be
required to register as an "investment Company" under the Investment Company Act
of 1940, as amended;
(v) Each of the Indenture and the Registration Rights
Agreements constitute legal, valid and binding obligations of the Company and
each Guarantor, enforceable against
B-2
the Company and each Guarantor in accordance with their terms (subject to
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other similar laws affecting creditors' rights generally from time
to time in effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether such enforceability is considered in a proceeding
in equity or at law);
(vi) The Securities when executed, issued and authenticated in
accordance with the provisions of the Indenture and delivered to you against
payment therefor in accordance with the provisions of the Placement Agreement,
will be legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms and entitled to the benefits of the
Indenture (subject to applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws affecting creditors' rights generally
from time to time in effect and to general principles of equity, including,
without limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether such enforceability is considered in a proceeding
in equity or at law); in expressing the opinion set forth in this paragraph
(vi), such counsel may assume, with the consent of the Placement Agents, that
the form of the Securities will conform to that included in the Indenture; and
(vii) Upon execution and delivery of the Indenture by the
Guarantors and the Company, the Guarantees will be legal, valid and binding
obligations of each of the Guarantors, enforceable against each of the
Guarantors in accordance with their terms and entitled to the benefits of the
Indenture (subject to applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws affecting creditors' rights generally
from time to time in effect and to general principles of equity, including,
without limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether such enforceability is considered in a proceeding
in equity or at law);
and to such further effect with respect to other legal matters relating to the
Placement Agreement and the sale of the Securities thereunder as counsel for the
Placement Agents may reasonably request.
Such opinion shall also state that, in connection with the
preparation of the Final Memorandum, such counsel has participated in
conferences with certain officers of, and with the accountants and counsel for,
the Guarantors and the Company concerning the preparation of the Final
Memorandum. Such opinion may state that although such counsel has made certain
inquiries and investigations in connection with the preparation of the Final
Memorandum, the limitations inherent in the role of outside counsel are such
that such counsel does not assume responsibility for the accuracy or
completeness of the statements made in the Final Memorandum, except insofar as
the statements relate to such counsel and except to the extent set forth in
paragraph (ii) of such counsel's opinion dated the date hereof. Subject to the
foregoing, such opinion shall state that such counsel advises the Placement
Agents that their work in connection with this matter did not disclose any
information that gave such counsel reason to believe that the Final Memorandum
(except the financial statements and other information of a statistical,
accounting or financial nature included therein, as to which such counsel does
not express any view) as of its date or the date hereof, included or includes
B-3
an untrue statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
EXHIBIT C
Form of Opinion of the General Counsel
of the Guarantors and the Company
(i) Each of the Guarantors and the Company is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Indiana with corporate power and authority under such laws to own,
lease and operate its properties and conduct its business as described in the
Final Memorandum and to perform its obligations under the Placement Agreement,
the Registration Rights Agreement, the Securities (with respect to the Company),
the Guarantees (with respect to the Guarantors), and the Indenture;
(ii) Each of the Guarantors and the Company are duly qualified
to transact business as a foreign corporation and are in good standing in each
other jurisdiction in which they own or lease property of a nature, or transact
business of a type, that would make such qualification necessary, except to the
extent that the failure to so qualify or be in good standing would not have a
Material Adverse Effect;
(iii) ATA is a "citizen of the United States" (as defined in
Section 40102(a)(15) of Title 49 of the United States Code) and is an air
carrier operating under a certificate issued by the Secretary of Transportation
pursuant to Chapter 447 of Title 49, United States Code, for aircraft capable of
carrying 10 or more individuals or 6,000 pounds or more of cargo; there is in
force with respect to ATA an air carrier operating certificate issued pursuant
to Part 121 of the regulations under the Federal Aviation Act; all of the
outstanding shares of capital stock of each of the Guarantors have been duly
authorized and validly issued and are fully paid and non-assessable and are
owned by the Company, free and clear of any pledge, lien, security interest,
charge, claim, equity or encumbrance of any kind;
(iv) No consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the valid
authorization, issuance and delivery of the Securities, the valid authorization,
execution, delivery and performance by each of the Guarantors and the Company of
the Placement Agreement and the Operative Documents, or the consummation by each
of the Guarantors and the Company of the transactions contemplated by the
Placement Agreement and the Operative Documents, except such as may be required
by the securities or Blue Sky laws of the various states in connection with the
offer and sale of the Securities;
(v) The execution and delivery by each of the Guarantors and
the Company of the Placement Agreement and the Operative Documents, the issuance
and sale of the Securities, the consummation by each of the Guarantors and the
Company of the transactions contemplated in the Placement Agreement and the
Operative Documents, and compliance by each of the Guarantors and the Company
with the terms thereof will not contravene (i) any provision of applicable law,
(ii) the certificate of incorporation or by-laws of any Guarantor and the
Company, (iii) to such counsel's knowledge, any agreement or other instrument
binding upon any Guarantor or any of its subsidiaries that is material to such
Guarantor and the Company, taken as a whole, or (iv) to such counsel's
knowledge, any judgment, order or
C-2
decree of any governmental body, agency or court having jurisdiction over, any
Guarantor or the Company;
(vi) Each of the Registration Rights Agreements and the
Indenture has been duly authorized, executed and delivered by each of the
Guarantors and the Company;
(vii) The Placement Agreement has been duly authorized,
executed and delivered by each of the Guarantors and the Company; and the sale
of the Securities by the Company pursuant to the Placement Agreement has been
duly authorized;
(viii) There are no legal or governmental proceedings pending
or threatened to which any Guarantor or the Company is a party, or to which any
of the properties of any Guarantor or the Company is subject, other than
proceedings accurately described in all material respects in the Final
Memorandum and proceedings that would not have a Material Adverse Effect, or a
material adverse effect on the power or ability of any Guarantor or the Company
to perform its obligations under this Agreement or the Operative Documents, or
to consummate the transactions contemplated by the Final Memorandum.
In addition, counsel shall state that such counsel or lawyers
on his staff have participated in the preparation of the Final Memorandum and
nothing has come to such counsel's attention that leads him to believe that the
Final Memorandum as of the date of the Placement Agreement or at the Closing
Date contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements therein
in the light of the circumstances under which they were made not misleading,
except that such counsel need express no opinion with respect to the financial
statements, schedules and other financial data included in the Final Memorandum.
