TRANS WORLD AIRLINES, INC.
Mandatory Conversion Equity Notes due 1999
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made
and entered into as of April 21, 1998, by and among Trans World Airlines,
Inc., a Delaware corporation (the "Company"), Lazard Freres & Co. LLC
("Lazard") and First Security Bank, National Association, as Owner Trustee
(the "Owner Trustee"), under the Trust Agreement dated as of January 24, 1995
between the Owner Trustee and Seven Sixty Seven Leasing, Inc., as beneficiary
(the "Beneficiary"). Subject to the terms and conditions stated in the
Aircraft Sale and Note Purchase Agreement dated as of April 9, 1998 among the
Company, the Owner Trustee and the Beneficiary (the "Sale Agreement"), the
Beneficiary will instruct the Owner Trustee to, and the Owner Trustee will,
sell to the Company three Boeing 767-231 ETOPS aircraft and their associated
engines for $25,000,000 for each such aircraft, payable by the issuance by the
Company of (i) $43,200,000 aggregate principal amount of the Company's 113/8%
Senior Secured Notes Due 2003 (the "Senior Notes") and (ii) $31,800,000
aggregate principal amount of the Company's Mandatory Conversion Equity Notes
due 1999 (the "Equity Notes"). In connection therewith, subject to the terms
and conditions stated in the Placement Agreement dated as of April 9, 1998
between the Company and Lazard (the "Placement Agreement"), the Company has
agreed to pay Lazard a placement fee of $3,000,000 which such fee has been
agreed under the Sale Agreement to be paid by the Owner Trustee, on behalf of
the Beneficiary, by payment of (x) $1,728,000 aggregate principal amount of
the Senior Notes and (y) $1,272,000 aggregate principal amount of the Equity
Notes to Lazard.
This Agreement is made pursuant to the Sale Agreement and the
Placement Agreement. In order to (x) fulfill its obligations to the Owner
Trustee under the Sale Agreement and (y) fulfill its obligations to Lazard
under the Placement Agreement, the Company has agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the closing of the Sale Agreement. All
capitalized terms used but not defined herein shall have the meanings ascribed
to them in the Indenture (as defined below) governing the Equity Notes.
The parties hereby agree as follows:
Section 1. Definitions.
As used in this Agreement, the following capitalized terms
shall have the following meanings:
Act: The Securities Act of 1933, as amended.
Closing Date: The date on which the closing of the sale of the
Aircraft to the Company in exchange for Senior Notes and Equity Notes to the
Owner Trustee is consummated pursuant to the Sale Agreement.
Commission: The United States Securities and Exchange
Commission and any successor federal agency having similar powers.
Common Stock: Includes any stock of any class of the Company
which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which is not subject to redemption by the Company. Unless the
context otherwise requires, all references to Common Stock shall include the
associated Rights.
Damages Payment Date: The last business day of each month.
Effectiveness Target Date: As defined in Section 3.
Equity Notes: Mandatory Conversion Equity Notes due 1999 of the
Company.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Holder: As defined in Section 2(b) hereof.
Indenture: The Indenture dated as of April 21, 1998 between the
Company and First Security Bank, National Association (the "Trustee"),
pursuant to which the Equity Notes have been issued, as such Indenture is
amended or supplemented from time to time in accordance with the terms thereof.
NASD: National Association of Securities Dealers, Inc.
Person: An individual, partnership, corporation, limited
liability company, trust or unincorporated organization or other entity, or a
government or agency or political subdivision thereof.
Private Placement Memorandum: The Private Placement
Memorandum, dated April 9, 1998, and all amendments and supplements thereto,
relating to the Equity Notes and prepared by the Company pursuant to the Sale
Agreement and the Placement Agreement.
Prospectus: The prospectus included in the Shelf Registration
Statement, as amended or supplemented by any prospectus supplement and by all
other amendments and supplements to the prospectus included in the Shelf
Registration Statement, including post-effective amendments, and all material
which may be incorporated by reference into such prospectus.
Record Holder: With respect to any Damages Payment Date
relating to the Transfer Restricted Securities, each Person who is a Holder of
record on the business day immediately preceding such Damages Payment Date.
Registrar: As defined in the Indenture.
Rights: The Rights of the Company entitling the holder to
purchase one one-hundredth of a share of the Company's Series A Participating
Preferred Stock, par value $.01 per share, under certain circumstances issued
pursuant to the Rights Agreement dated as of December 19, 1995 between the
Company and American Stock Transfer & Trust Company, as Rights Agent,
supplemented as of March 18, 1996 and as it may be further amended or
supplemented from time to time.
Shelf Registration Statement: As defined in Section 3(a)
hereof.
Transfer Restricted Securities: Each share of Common Stock,
issued upon conversion of the Equity Notes, until the date on which each such
share of Common Stock (i) has been effectively registered under the Act and
disposed of in accordance with the Shelf Registration Statement or (ii) is
distributed to the public pursuant to Rule 144 under the Act or is saleable
pursuant to Rule 144(k) under the Act (or similar provisions then in force).
Usable: Complies with the applicable rules and regulations of
the Act including, without limitation, Rule 3-12 of Regulation S-X and Item
512 of Regulation S-K.
Section 2. Securities Subject to this Agreement.
(a) Transfer Restricted Securities. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A
Person is deemed to be a holder of record of Transfer Restricted Securities
(each, a "Holder") whenever such Person owns Transfer Restricted Securities
or is entitled to receive Transfer Restricted Securities upon conversion of
the Equity Notes.
Section 3. Shelf Registration and Listing.
(a) The Company shall file with the Commission, as soon as
practicable after the Closing Date, but in any event on or prior to the date
60 days after the Closing Date, a shelf registration statement pursuant to
Rule 415 under the Act (the "Shelf Registration Statement") on Form S-3 to
cover resales of all Transfer Restricted Securities by the Holders thereof who
have provided the information required by Section 3(b) hereof; provided that
the Company may file the Shelf Registration Statement on Form S-1 or Form S-2
if Form S-3 is not then available to the Company. The Company will use its
reasonable best efforts to cause such Shelf Registration Statement to be
declared effective by the Commission within 150 days after the Closing Date
(the "Effectiveness Target Date"). The Company shall use its reasonable best
efforts to keep such Shelf Registration Statement continuously effective,
subject to the provisions of Section 5 hereof, until the earlier of (i) the
sale of all Transfer Restricted Securities covered by the Shelf Registration
Statement, and (ii) the expiration of two years after the date of original
issuance of the Equity Notes or, if the period applicable under Rule 144(k)
under the Act, or any successor provision for such securities is shortened,
such shorter period. Subject to the right of the Company to have the Shelf
Registration Statement not be effective for periods of time set forth in
Section 5 hereof, the Company further agrees to use its reasonable best
efforts to prevent the happening of any event that would cause the Shelf
Registration Statement to contain a material misstatement or omission or to be
not effective and usable for resale of the Transfer Restricted Securities
during the period that such Shelf Registration Statement is required to be
effective and usable. Upon the occurrence of any event that would cause the
Shelf Registration Statement (i) to contain a material misstatement or
omission or (ii) to not be effective or usable for resale of Transfer
Restricted Securities during the period that such Shelf Registration Statement
is required to be effective and usable, the Company shall promptly file an
amendment to the Shelf Registration Statement, in the case of clause (i),
correcting any such misstatement or omission, and in the case of either clause
(i) or (ii), use its reasonable best efforts to cause such amendment to be
declared effective and such Shelf Registration Statement to become usable as
soon as practicable thereafter. The Company's obligation to maintain an
effective Shelf Registration Statement shall be extended for the amount of
time that such Shelf Registration shall not have been effective or otherwise
usable.
(b) No Holder may include any of its Transfer Restricted
Securities in any Shelf Registration Statement pursuant to this Agreement
unless such Holder furnishes to the Company in writing, within 10 business
days after receipt of a request therefor (which initial request shall be made
within 40 days after the Closing Date to the Holders on a record date not more
than 5 days prior to such request), such information and representations and
warranties as the Company may reasonably request for use in connection with
any Shelf Registration Statement or Prospectus or preliminary Prospectus
included therein. No Holder shall be entitled to liquidated damages pursuant
to Section 4 hereof if such Holder's Transfer Restricted Securities are
excluded from a Shelf Registration Statement because such Holder failed to
furnish the Company in writing such information and representations and
warranties reasonably requested by the Company for use in connection with such
Shelf Registration Statement or Prospectus or preliminary Prospectus included
therein. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously provided to the
Company by such Holder not materially misleading.
(c) The Company shall use its reasonable best efforts to have the
shares of Common Stock issuable upon conversion of the Equity Notes approved
for listing on the American Stock Exchange ("ASE"), or on such other stock
exchange or market as the Common Stock is then principally traded, no later
than the effectiveness date of the Shelf Registration Statement relating to
such Common Stock, and, if applicable, to maintain such listing until the
earlier to occur of (i) the sale of all Transfer Restricted Securities covered
by the Shelf Registration Statement, and (ii) the expiration of two years
after the date of issuance of the Equity Notes or, if the period applicable
under Rule 144(k) under the Act, or any successor provision relating to the
free transferability of the Transfer Restricted Securities, is shortened, such
shorter period.
Section 4. Liquidated Damages.
Each of the Company, on behalf of itself, the Owner Trustee, on
behalf of the Beneficiary, and Lazard, on behalf of itself, (and each of them
on behalf of each subsequent Holder) agrees that (a) the Holders will suffer
damages if (i) the Shelf Registration Statement is not maintained in the manner
and within the time periods contemplated by Section 3 hereof or (ii) the
Company does not maintain the listing of the Common Stock issuable on the
Conversion Date (as defined in the Indenture) on the ASE, or such other stock
exchange or market on which the Common Stock is principally traded, within the
time period contemplated by Section 3 and (b) it would not be feasible to
ascertain the extent of such damages with precision. Accordingly, if (x) the
Shelf Registration Statement is filed and declared effective but shall on or
after the Conversion Date cease to be effective (without being succeeded
immediately by an additional Shelf Registration Statement filed and declared
effective) or usable for a period of time which shall exceed 60 days in the
aggregate during any year (defined as any period of 365 days commencing on or
after the date the Shelf Registration Statement is declared effective) or (y)
the Company shall fail to maintain the approval for listing of the shares of
Common Stock that constitute the Transfer Restricted Securities in accordance
with Section 3(c) (each such event, an "Effectiveness Default"), the Company
shall pay liquidated damages to each Holder who has complied with such
Holder's obligations hereunder, during the first 90-day period immediately
following the occurrence of any such Effectiveness Default in an amount equal
to $0.01 per week per share of Common Stock (subject to adjustment in the
event of stock splits, stock recombinations, stock dividends and the like)
constituting Transfer Restricted Securities held by such Holder. The amount
of the liquidated damages will increase by an additional $0.01 per week per
share of Common Stock (subject to adjustment as set forth above) constituting
Transfer Restricted Securities held by such Holder for each subsequent 90-day
period until the Shelf Registration Statement again becomes effective and
usable or the approval for listing is cured, up to a maximum amount of
liquidated damages with respect to any such Effectiveness Default of $0.05 per
week per share (subject to adjustment as set forth above) of Common Stock
constituting Transfer Restricted Securities. All accrued and unpaid liquidated
damages shall be paid to Record Holders by wire transfer of immediately
available funds or by federal funds check by the Company on each Damages
Payment Date. If the Company defaults in a payment of any liquidated damages
hereunder, it shall pay the liquidated damages, plus interest on the
liquidated damages at the rate of twelve percent (12%) per annum to the extent
permitted by law, to the persons who are Holders on the subsequent Damages
Payment Date. Following the cure of an Effectiveness Default, liquidated
damages will cease to accrue with respect to such Effectiveness Default.
All of the Company's obligations to pay accrued but unpaid
liquidated damages set forth in the preceding paragraph which are outstanding
with respect to any Transfer Restricted Security at the time such security
ceases to be a Transfer Restricted Security shall survive until such time as
all such obligations with respect to such security shall have been satisfied
in full.
The parties hereto agree that the liquidated damages provided
in this Section 4 constitute a reasonable estimate of the damages that will be
incurred by Holders if, on or after the Conversion Date, after using
reasonable best efforts, the Company is unable (x) to maintain the
effectiveness of the Shelf Registration Statement for the period required by
Section 3(a) or (y) to maintain the approval for listing of the shares of
Common Stock that constitute Transfer Restricted Securities for the period
required by Section 3(c). It is the intention of the parties that if an
Effectiveness Default shall occur as a result of the Company's failure to use
its reasonable best efforts to cause the undertakings described in clauses (x)
and (y) of the preceding sentence to occur, Holders shall be entitled to any
damages appropriate under applicable law, which damages shall not be limited
to the liquidated damages under this Section 4; provided that any amounts of
interest or liquidated damages paid pursuant to Section 2.2 of the Indenture
or Section 4 of this Agreement, respectively, shall be credited against any
amounts awarded to Holders by a court of competent jurisdiction.
Section 5. Registration Procedures.
In connection with the Shelf Registration Statement, the
Company will use its reasonable best efforts to effect such registration to
permit the sale of the Transfer Restricted Securities being sold in accordance
with the intended method or methods of distribution or disposition thereof,
and pursuant thereto the Company will as expeditiously as possible:
(a) on or prior to the date 60 days after the Closing Date, prepare
and file with the Commission a Shelf Registration Statement relating to the
registration on Form S-3 (or, if Form S-3 is not available, on Form S-1 or
Form S-2) for the sale of the Transfer Restricted Securities in accordance with
the intended method or methods of distribution thereof and shall include or
incorporate all required financial statements, reports, schedules, exhibits and
other documents; cause to be made, or otherwise cooperate and assist in any
filings required to be made with the NASD and use its reasonable best efforts
to cause such Shelf Registration Statement to become effective and approved
on or prior to the Effectiveness Target Date by such governmental agencies or
authorities as may be necessary to enable the selling Holders to consummate
the disposition of such Transfer Restricted Securities; provided that before
filing a Shelf Registration Statement or any Prospectus, or any amendments or
supplements thereto, including documents incorporated by reference after the
initial filing of the Shelf Registration Statement, the Company shall furnish
to such Holders and underwriters, if any, copies of all such documents proposed
to be filed, which documents shall be subject to the review of such Holders,
and the Company shall not file any Shelf Registration Statement or amendment
thereto or any Prospectus or any supplement thereto (including such documents
incorporated by reference) to which the Holders of the Transfer Restricted
Securities covered by such Shelf Registration Statement or the underwriters, if
any, shall reasonably object in writing within four business days after the
receipt thereof on the grounds that such Shelf Registration Statement,
Prospectus, amendment or supplement does not (x) comply in all material
respects with the requirements of the Act or the rules and regulations
thereunder or (y) fairly or accurately describe any description or other
information pertaining to any of such Holders or concerning the plan of
distribution contemplated by such Holders;
(b) prepare and file with the Commission such amendments and
post-effective amendments to the Shelf Registration Statement as may be
necessary to keep the Shelf Registration Statement effective for the
applicable period set forth in Section 3(a) hereof; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 under the Act, and to comply fully with the
applicable provisions of Rule 424 under the Act in a timely manner; and comply
with the provisions of the Act with respect to the disposition of all
securities covered by such Shelf Registration Statement during the applicable
period in accordance with the intended method or methods of distribution by
the sellers thereof set forth in such Shelf Registration Statement or
supplement to the Prospectus;
(c) advise the selling Holders promptly and, if requested by such
Persons, to confirm such advice in writing, (i) when the Prospectus or any
Prospectus supplement or post-effective amendment has been filed, and, with
respect to the Shelf Registration Statement or any post-effective amendment
thereto, when the same has become effective, (ii) of any request by the
Commission for amendments to the Shelf Registration Statement or amendments or
supplements to the Prospectus or for additional information relating thereto,
(iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Shelf Registration Statement under the Act or of the
suspension by any state securities commission of the qualification of the
Transfer Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, (iv) if at any
time the representations and warranties of the Company contemplated by
paragraph (l)(i) below cease to be true and correct, and (v) of the existence
of any fact and the happening of any event that makes any statement of a
material fact made in the Shelf Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to or changes in
the Shelf Registration Statement or the Prospectus, any amendment or supplement
thereto, or any document incorporated by reference therein in order to make
the statements therein not misleading in the light of the circumstances then
existing. If at any time the Commission shall issue any stop order suspending
the effectiveness of the Shelf Registration Statement, or any state securities
commission or other regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Transfer Restricted
Securities under state securities or Blue Sky laws, the Company shall use its
best efforts to obtain the withdrawal or lifting of such order at the earliest
possible time;
(d) no less than 24 hours prior to the filing of any document that
is to be incorporated by reference into the Shelf Registration Statement or the
Prospectus (after the initial filing of the Shelf Registration Statement),
provide copies of such document to the selling Holders and underwriters, if
any, make the Company's representatives available at reasonable times for
discussion of such document and include such information in such document
prior to the filing thereof as such selling Holders or underwriters may
reasonably and timely request;
(e) furnish to each selling Holder and underwriter, if any, without
charge, at least one copy of the Shelf Registration Statement, as first filed
with the Commission, and of each amendment thereto, including all documents
incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference);
(f) deliver to each selling Holder and underwriter, if any, without
charge, as many copies of the Prospectus (including each preliminary
Prospectus) and any amendment or supplement thereto as such Persons may
reasonably request; the Company consents to the use of the Prospectus and any
amendment or supplement thereto by each of the selling Holders and
underwriters, if any, in connection with the public offering and sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;
(g) prior to any public offering of Transfer Restricted
Securities, use its reasonable best efforts to cause the Transfer Restricted
Securities covered by the Shelf Registration Statement to be registered with
or approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof to consummate the
disposition of such Transfer Restricted Securities and otherwise cooperate
with the selling Holders and underwriters, if any, and their respective
counsel in connection with the registration and qualification of the Transfer
Restricted Securities under the securities or Blue Sky laws of such
jurisdictions as the selling Holders and underwriters, if any, may reasonably
request and do any and all other acts or things necessary or advisable to
enable the disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement; provided, however,
that the Company shall be required neither to register or qualify as a foreign
corporation where it is not now so qualified nor to take any action that would
subject it to the service of process in suits or to taxation, other than as to
matters and transactions relating to the Shelf Registration Statement, in any
jurisdiction where it is not now so subject;
(h) in connection with any sale of Transfer Restricted Securities
that will result in such securities no longer being Transfer Restricted
Securities, cooperate with the selling Holders to facilitate the timely
preparation and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends; and enable such
Transfer Restricted Securities to be in such denominations and registered in
such names as the Holders may request at least two business days prior to any
sale of Transfer Restricted Securities made by such Holders;
(i) use its reasonable best efforts to cause the Transfer
Restricted Securities covered by the Shelf Registration Statement to be
registered with or approved by such other governmental agencies or authorities
as may be necessary to enable the seller or sellers thereof to consummate the
disposition of such Transfer Restricted Securities, subject to the proviso
contained in clause (g) above;
(j) if any fact or event contemplated by clause (v) of paragraph
(c) above shall exist or have occurred, as promptly as practicable thereafter,
prepare a supplement or post-effective amendment to the Shelf Registration
Statement or related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of Transfer Restricted Securities, the Prospectus will not
contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading;
(k) provide CUSIP numbers for all Transfer Restricted Securities
not later than the effective date of the Shelf Registration Statement and
provide the transfer agent for the Common Stock with printed certificates for
the Transfer Restricted Securities;
(l) enter into such agreements and take all such other actions
consistent with its obligations hereunder in connection therewith and as may be
reasonably required in order to expedite or facilitate the disposition of the
Transfer Restricted Securities pursuant to the Shelf Registration Statement,
and in such connection the Company shall (i) make such representations and
warranties to the Holders and underwriters, if any, in form, substance and
scope as are customarily made by issuers to underwriters in primary
underwritten offerings and covering matters including, but not limited to,
those set forth in the Sale Agreement and the Placement Agreement; (ii) obtain
opinions of counsel to the Company and updates thereof (which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to the
Holders of the Transfer Restricted Securities being sold and underwriters, if
any) addressed to each selling Holder and underwriter, if any, requesting the
same and covering such matters as are customarily covered in company counsel
opinions to underwriters in primary underwritten offerings; (iii) obtain "cold
comfort" letters and updates thereof from the Company's independent certified
public accountants addressed to the selling Holders and underwriters, if any,
requesting the same, such letters to be in customary form and covering matters
of the type customarily covered in "cold comfort" letters to underwriters in
connection with primary underwritten offerings; and (iv) deliver such
documents and certificates as may be reasonably requested by the Holders of
the Transfer Restricted Securities being sold and underwriters, if any, to
evidence compliance with clause (i) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into by the
Company pursuant to this clause (1);
(m) subject to appropriate confidentiality arrangements being
entered into, make available at reasonable times for inspection by the Holders
of the Transfer Restricted Securities participating in any disposition
pursuant to such Shelf Registration Statement, any underwriters and any
attorney or accountant retained by such selling Holders or underwriters, all
financial and other records, pertinent corporate documents and properties of
the Company and cause the Company's officers, directors and employees to
supply all information reasonably requested by any such Holder, underwriter,
attorney or accountant at reasonable times in connection with such Shelf
Registration Statement subsequent to the filing thereof and prior to its
effectiveness;
(n) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders, as soon as reasonably practicable, a
consolidated earnings statement (which need not be audited) for the
twelve-month period, beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Shelf Registration
Statement;
(o) use its reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of the Shelf Registration Statement at the
earliest possible moment; use its reasonable best efforts (i) to prevent the
entry of any stop order affecting the Registration Statement and (ii) to
remove any such stop order if entered; and
(p) cooperate and assist in any filings required to be made with
the NASD.
The Company agrees that it will not include in the registration
contemplated by the Shelf Registration Statement any securities other than the
Transfer Restricted Securities. The Company represents and warrants to the
Owner Trustee and Lazard that it will not be required to include under the
Shelf Registration Statement any other securities.
The Owner Trustee, on behalf of the Beneficiary, Lazard, on
behalf of itself, and both the Owner Trustee and Lazard on behalf of each
subsequent Holder agree by acquisition of Transfer Restricted Securities that,
upon receipt of any notice from the Company of the existence of any fact or
the happening of any event of the kind described in clause (v) of Section 5(c)
hereof, such Holder will forthwith discontinue disposition of Transfer
Restricted Securities pursuant to the Shelf Registration Statement until such
Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 5(j) hereof, or until it is advised in writing (the
"Advice") by the Company that the use of the Prospectus may be resumed, and
has received copies of any additional or supplemental filings which are
incorporated by reference in the Prospectus. If so directed by the Company,
each Holder will, or will request the managing underwriter or underwriters, if
any, to deliver to the Company (at the Company's expense) all copies, other
than permanent file copies then in such Holder's possession, of the Prospectus
covering such Transfer Restricted Securities current at the time of receipt of
such notice.
Section 6. Registration Expenses.
All expenses incident to the Company's performance of or
compliance with this Agreement will be borne by the Company, regardless of
whether a Shelf Registration Statement becomes effective, including without
limitation:
(i) all registration and filing fees and expenses;
(ii) fees and expenses of compliance with federal securities or
state blue sky laws (including reasonable fees and disbursements of
counsel to the Holders and the underwriters, if any, in connection
with blue sky qualifications of the Transfer Restricted Securities);
(iii) expenses of printing (including, without limitation,
expenses of printing or engraving certificates for the Transfer
Restricted Securities, expenses of printing or engraving certificates
for the Common Stock and expenses of printing prospectuses), messenger
and delivery services and telephone;
(iv) fees and disbursements of counsel for the Company and
reasonable fees and disbursements of one counsel for the Holders
chosen by the Holders of a majority of the outstanding Transfer
Restricted Securities (determined as provided in Section 10(d));
(v) fees and disbursements of all independent certified public
accountants of the Company (including the expenses of any special
audit and "cold comfort" letters required by or incident to such
performance);
(vi) filing fees associated with any NASD filing required to be
made in connection with the Shelf Registration Statement;
(vii) fees and expenses of listing the Transfer Restricted
Securities on any securities exchange or quotation system in
accordance with Section 3(c) hereof; and
(viii) securities acts liability insurance, if the Company
desires such insurance.
All such expenses, including without limitation those described
in the foregoing clauses (i) to (viii) are referred to herein as "Registration
Expenses."
The Company will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit, and the fees and expenses of any Person, including special experts,
retained by the Company. The Holders shall bear the expense of any broker's
commission or underwriters' discount or commission.
Section 7. Underwriting.
If any of the Transfer Restricted Securities covered by any
Shelf Registration Statement are to be sold in an underwritten offering, the
investment banker(s) and manager(s) that will manage the offering will be
selected by the Holders of a majority of the then outstanding Transfer
Restricted Securities (determined in accordance with Section 10(d)) included in
such offering (after consultation with the Company as to such selection and
upon the written consent of the Company, which consent shall not be
unreasonably withheld or delayed). If requested by the underwriters, the
Company will promptly enter into an underwriting agreement reasonably
acceptable to the Company with such underwriters for such offering, such
agreement to contain such representations and warranties by the Company and
such other terms and conditions as are customary for underwriting agreements
with respect to secondary offerings, including without limitation, indemnities
to the effect and to the extent provided in Section 8 hereof. The Holders on
whose behalf such securities are being distributed shall be party to any such
underwriting agreement. Such Holders shall not be required by the Company to
make any representations or warranties to the underwriters with respect to the
Company or the Transfer Restricted Securities (other than that the Holders are
conveying such securities free and clear of all pledges, security interests,
liens, charges, encumbrances, agreements, equities, claims and options of
whatever nature), and the Holders shall not be required to indemnify the
Company or the underwriters (other than with respect to the matters, and to
the extent, provided in Section 8). Furthermore, the Company shall make
available for inspection by the Holders, any underwriter participating in any
disposition pursuant to such Shelf Registration Statement, and any attorney,
accountant or other agent retained by any Holder or underwriter, all financial
and other records and other information, pertinent corporate documents and
properties of the Company as shall be reasonably necessary to enable them to
exercise their due diligence responsibilities.
No Holder may participate in any underwritten distribution
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved in accordance with the terms hereof, and (b) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements
and other documents required under the terms of such underwriting arrangements.
Section 8. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Holder
and each person, if any, who controls such Holder within the meaning of the
Act or the Exchange Act (each Holder and such controlling persons referred to
in this Section 8(a) and the Company and its controlling persons referred to in
Section 8(b), being collectively referred to herein, as the case may be, as the
"indemnified parties") from and against any losses, claims, damages or
liabilities, joint or several, or any actions in respect thereof (including,
but not limited to, any losses, claims, damages, liabilities or actions
relating to purchases and sales of the Transfer Restricted Securities) to
which each indemnified party may become subject under the Act, the Exchange
Act or otherwise, insofar as such losses, claims, damages, liabilities or
actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Shelf Registration Statement or
Prospectus or in any amendment or supplement thereto or in any preliminary
prospectus relating to the Shelf Registration Statement, or arise out of, or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and shall reimburse, as incurred, the indemnified parties for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action
in respect thereof; provided, however, that (i) the Company shall not be
liable in any such case to the extent that such loss, claim, damage or
liability arises out of or is based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in the Shelf
Registration Statement or Prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to the Shelf Registration Statement
in reliance upon and in conformity with written information pertaining to such
Holder and furnished to the Company by or on behalf of such Holder
specifically for inclusion therein, (ii) with respect to any untrue statement
or omission or alleged untrue statement or omission made in the Prospectus
relating to such Shelf Registration Statement, the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of any person
as to which there is a prospectus delivery requirement (a "Delivering Seller")
that sold the Transfer Restricted Securities to the person asserting any such
losses, claims, damages or liabilities to the extent that any such loss,
claim, damage or liability of such Delivering Seller results from the fact
that there was not sent or given to such person, on or prior to the written
confirmation of such sale, a copy of the Prospectus, as amended and
supplemented, provided that (I) the Company shall have previously furnished
copies thereof to such Delivering Seller in accordance with this Agreement and
(II) such furnished Prospectus, as amended and supplemented, would have
corrected any such untrue statement or omission or alleged untrue statement or
omission, and (iii) this indemnity agreement will be in addition to any
liability which the Company may otherwise have to such indemnified party. The
Company shall also indemnify underwriters, selling brokers, dealer-managers
and similar securities industry professionals participating in the
distribution (in each case as described in the Shelf Registration Statement),
their officers and directors and each person who controls such persons within
the meaning of the Act or the Exchange Act to the same extent as provided
above with respect to the indemnification of the Holders if requested by such
Holders.
(b) Each Holder, severally and not jointly, will indemnify and hold
harmless the Company, each other Holder and each person, if any, who controls
the Company and each such Holder within the meaning of the Act or the Exchange
Act from and against any losses, claims, damages or liabilities or any actions
in respect thereof to which the Company, each other Holder or any such
controlling person may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages, liabilities or actions
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Shelf Registration Statement or Prospectus
or in any amendment or supplement thereto or in any preliminary prospectus
relating to the Shelf Registration Statement, or arise out of or are based upon
the 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, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information pertaining to such
Holder and furnished to the Company by or on behalf of such Holder
specifically for inclusion therein; and, subject to the limitation set forth
immediately preceding this clause, shall reimburse, as incurred, the Company
and each such Holder for any legal or other expenses reasonably incurred by
the Company, each other Holder or any such controlling person in connection
with investigating or defending any loss, claim, damage, liability or action in
respect thereof. This indemnity agreement will be in addition to any liability
which such Holder may otherwise have to the Company, each other Holder or any
of their respective controlling persons.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action or proceeding (including
a governmental investigation), such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not, in any event, relieve
the indemnifying party from any obligations to any indemnified party, except
to the extent that it is prejudiced or harmed in any material respect by
failure to give such prompt notice. In case any such action is brought
against any indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with one
counsel (and local counsel as necessary) reasonably satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof the indemnifying party will not be liable to such indemnified
party under this Section 8 for any legal or other expenses, other than
reasonable costs of investigation, subsequently incurred by such indemnified
party in connection with the defense thereof. No indemnifying party shall,
without the prior written consent of the indemnified party, not to be
unreasonably withheld, effect any settlement of any pending or threatened
action 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 any claims that are the subject matter of such
action and does not include any injunctive relief against such indemnified
party. No indemnifying party shall be liable for any amounts paid in
settlement of any action or claim without its written consent, which consent
shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under
subsections (a) or (b) above for any reason, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from
the initial sale of the Aircraft for the Notes and the Equity Notes; provided,
however, that in no event shall the Owner Trustee, Lazard or any subsequent
Holder be responsible, in the aggregate, for any amount in excess of the
Placement Fee (as defined in the Placement Agreement), or (ii) if the
allocation provided by the foregoing clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on the
other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof) as well
as any other relevant equitable considerations. The relative fault of the
parties 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
the Company on the one hand or such Holder or such other indemnified person,
as the case may be, on the other, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
Notwithstanding any other provision of this Section 8(d), the Holders shall
not be required to contribute any amount in excess of the amount by which the
net proceeds received by such Holders from the sale of the Transfer Restricted
Securities pursuant to the Shelf Registration Statement exceeds the amount of
damages which such Holders have 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 Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this
paragraph (d), each officer, director, employee, representative and agent of
an indemnified party and each person, if any, who controls such indemnified
party within the meaning of the Act or the Exchange Act shall have the same
rights to contribution as such indemnified party.
(e) The Company and each Holder agree that it would not be just and
equitable if contributions pursuant to Section 8(d) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 8(d).
(f) The agreements contained in this Section 8 shall survive the
sale of the Transfer Restricted Securities pursuant to the Shelf Registration
Statement and shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement or any investigation made by or
on behalf of any indemnified party.
Section 9. Rule 144.
The Company shall use its reasonable best efforts to file on a
timely basis all such reports required to be filed under the Exchange Act as,
and endeavor in good faith to take such other actions as, are reasonably
necessary to enable Holders to sell Transfer Restricted Securities without
registration under the Act within the limitation of the exemptions provided by
(a) Rule 144 under the Act, as such Rule may be amended from time to time, and
(b) any similar rules or regulations hereafter adopted by the Commission. Upon
request of any Holder, the Company will deliver a written statement as to
whether it has complied with such requirements and will, at its expense,
forthwith upon the request of the Owner Trustee, the Beneficiary or Lazard,
deliver to the Owner Trustee, the Beneficiary or Lazard a certificate, signed
by the Company's principal financial officer, stating (i) the Company's name,
address and telephone number (including area code), (ii) the Company's
Internal Revenue Service identification number, (iii) the Company's Commission
file number, (iv) the number of shares of each class of capital stock
outstanding as shown by the most recent report or statement published by the
Company, and (v) whether the Company has filed the reports required to be
filed under the Exchange Act for a period of at least ninety (90) days prior
to the date of such certificate and in addition has filed the most recent
annual report required to be filed thereunder.
Section 10. Miscellaneous.
(a) Remedies. Each Holder, in addition to being entitled to
exercise all rights provided herein, and as provided in the Sale Agreement and
granted by law and, in the case of Lazard, as provided in the Placement
Agreement, including the recovery of damages, shall be entitled to specific
performance of such Holder's rights under this Agreement. Except with respect
to the payment of Liquidated Damages in the event of the occurrence of an
Effectiveness Default, the Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agrees in any action for specific
performance to waive the defense that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company has not and shall not
on or after the date of this Agreement enter into any agreement with respect
to its securities that is inconsistent with the rights granted to the Holders
in this Agreement or otherwise conflicts with the provisions hereof. The
rights granted to the Holders hereunder do not and will not in any way
conflict with and are not and will not be inconsistent with the rights granted
to the holders of the Company's securities under any other agreements. No
holder of securities of the Company has rights to the registration of any
securities of the Company because of the execution, delivery or performance
by the Company of this Agreement or as a result of the filing of the Shelf
Registration Statement.
(c) No Adverse Action Affecting the Transfer Restricted
Securities. The Company has not taken and will not take, any action, or
permit any change to occur with respect to the Transfer Restricted Securities
which would adversely affect the ability of any of the Holders to include such
Holder's Transfer Restricted Securities in a registration undertaken pursuant
to this Agreement.
(d) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of
Holders of a majority of the outstanding principal amount of Equity Notes
assuming conversion thereof into Common Stock or, if the Equity Notes have
been converted into Common Stock, the outstanding shares of Common Stock
constituting Transfer Restricted Securities, as the case may be.
Notwithstanding the foregoing, a waiver or consent to departure from the
provisions hereof that relates exclusively to the rights of Holders whose
Transfer Restricted Securities are being sold pursuant to the Shelf
Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by the Holders of a majority of the
Transfer Restricted Securities being sold.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight deliver:
(i) if to a Holder, at the address set forth on the records of
the Company or the Registrar under the Indenture, with a copy to the
Registrar, and if to the Owner Trustee, at the address set forth in
the Sale Agreement and if to Lazard, at the address set forth in the
Placement Agreement; and
(ii) if to the Company, initially at its address set forth in the
Sale Agreement and thereafter at such other address, notice of which
is given in accordance with the provisions of this Section.
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if telecopied; and
on the next business day, if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee
under the Indenture at the address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon and enforceable by the successors and assigns
of each of the parties, including without limitation and without the need for
an express assignment, subsequent Holders.
(g) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance,
is held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
(k) Entire Agreement. This Agreement is intended by the parties as
a final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the securities sold pursuant to the Sale Agreement and the Placement
Agreement except as provided in the Indenture, the Sale Agreement and the
Placement Agreement. Except as set forth in the prior sentence, this
Agreement supersedes all prior agreements and understandings between the
parties with respect to such subject matter.
(l) Like Treatment of Holders. Neither the Company nor any of its
affiliates shall, directly or indirectly, pay or cause to be paid any
consideration (immediate or contingent), whether by way of interest, fee,
payment for the exchange of Transfer Restricted Securities, or otherwise, to
any Holder, for or as an inducement to, or in connection with the solicitation
of, any vote, consent, waiver or amendment of any terms or provisions of this
Agreement, unless such consideration is required to be paid to all Holders
bound by such vote, consent, waiver or amendment whether or not such Holders
so consent, vote, waive or agree to amend and whether or not such Holders
tender their Transfer Restricted Securities for redemption or conversion.
Notwithstanding the foregoing, the Company may pay or cause to be paid
consideration to any Holder in connection with any transaction the purpose of
which is not to induce or solicit any vote, consent, waiver or amendment of
any terms or provisions of this Agreement.
[Remainder of this page is blank.]
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above.
TRANS WORLD AIRLINES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Deputy
General Counsel
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual
capacity but as Owner Trustee for
Seven Sixty Seven Leasing, Inc.
By: /s/ C. ▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: C. ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
LAZARD FRERES & CO. LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
