Exhibit 10.39
EXECUTION COPY
ENGINE PURCHASE AGREEMENT
THIS ENGINE PURCHASE AGREEMENT (this "Agreement") is made as of the 18th
day of December, 2001 by and between CHAUTAUQUA AIRLINES, INC., a New York
corporation, as seller (the "Seller"), and AVIATION FINANCIAL SERVICES INC., a
Delaware corporation, as buyer (the "Buyer").
W I T N E S S E T H:
WHEREAS, Seller owns five (5) Rolls-Royce model AE3007A1P aircraft engines
and will purchase four (4) Rolls-Royce model AE3007A1P aircraft engines from the
Engine Manufacturer pursuant to the Manufacturer Purchase Agreement on the
respective Delivery Dates of such Engines, all as more fully described in
EXHIBIT C hereof and defined below; and
WHEREAS, Seller desires to sell to Buyer all of its right, title and
interest in and to the Engines pursuant to the terms and conditions of this
Agreement; and
WHEREAS, Buyer desires to purchase from Seller all of Seller's right, title
and interest in and to the Engines pursuant to the terms and conditions of this
Agreement; and
WHEREAS, immediately upon the purchase of the Engines by Buyer from the
Seller, Buyer desires to lease to Seller and Seller desires to lease from Buyer
the Engines pursuant to the terms and conditions of the Lease (as defined
below).
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS.
Capitalized terms defined elsewhere in this Agreement shall have the
respective meanings there ascribed to them. The following capitalized terms
shall have the following meanings:
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or any
day which is a legal holiday for commercial banking institutions in New
York, New York and Indianapolis, Indiana.
"DELIVERY" shall mean, with respect to each Engine, the following
events performed in connection with the sale of such Engine by Seller in
accordance with the terms hereof, all of which events shall be deemed to
occur concurrently for the purpose of this Agreement and the transactions
contemplated hereby:
(a) the tender of such Engine by Seller to Buyer at the Delivery
Location;
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Certain portions of this exhibit have been omitted pursuant to a request for
confidential treatment under Rule 406 of the Securities Act of 1933. The
omitted materials have been filed separately with the Securities and Exchange
Commission.
(b) the delivery by Seller to Buyer of the Warranty Xxxx of Sale
relating to such Engine;
(c) the delivery by Buyer to Seller of the Delivery Receipt with
respect to such Engine; and
(d) the payment by (or on behalf of) Buyer to Seller of the
Purchase Price relating to such Engine.
"DELIVERY DATE" shall mean, with respect to each Engine, the date of
Delivery of such Engine.
"DELIVERY LOCATION" shall mean any location mutually approved by
Seller and Buyer which is determined by the parties to be acceptable for
taxation purposes.
"DELIVERY RECEIPT" shall mean, with respect to each Engine, the
receipt, in the form attached hereto as EXHIBIT A, executed by Buyer and
delivered to Seller as part of the Delivery of such Engine, evidencing the
delivery of such Engine to Buyer.
"DOLLARS" shall mean the legal currency, at the relevant time, of the
United States of America.
"ENGINE DOCUMENTS" shall mean, with respect to each Engine, each and
all of the documents, data and records to extent owned by Seller pertaining
to, as applicable, such Engine, as itemized in the schedule attached to the
Delivery Receipt of such Engine.
"ENGINE MANUFACTURER" shall mean Rolls-Royce Corporation.
"ENGINES" shall mean, collectively, the nine (9) Rolls-Royce model
AE3007A1P aircraft engines manufactured by Engine Manufacturer bearing the
manufacturer's serial numbers set forth in EXHIBIT C hereto, together with
all appliances, parts, instruments, accessories, furnishings and all other
items of equipment incorporated in, installed on, appurtenant to, or
otherwise included with such Engines on the respective Delivery Date.
"EVENT OF LOSS" shall have the meaning giving in the Lease.
"FAA" shall mean the Federal Aviation Administration of the United
States of America and any successor agency thereto.
"LEASE" shall mean the Master Engine Lease Agreement dated as of
December 18, 2001 between Lessor, as lessor and Lessee, as lessee,
incorporating the provisions of an Engine Lease Common Terms Agreement
dated as of December 18, 2001 (the "CTA") between Lessee and General
Electric Capital Corporation, including each Engine Lease Supplement to
such Master Engine Lease Agreement and each Certificate of Acceptance (as
defined therein).
"LESSEE" shall mean the Seller.
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"LESSOR" shall mean the Buyer.
"MANUFACTURER PURCHASE AGREEMENT" means the AE 3007A/1 Series Engine
General Terms Agreement dated as of December 6, 2000 between the Engine
Manufacturer and the Lessee, as amended and supplemented from time to time.
"MORTGAGE RELEASE" shall mean, with respect to any Engine subject to
an Engine Chattel Mortgage, Security Agreement and Assignment of Rents in
favor of Fleet Capital Corporation (each an "Existing Mortgage"), the
Release of Engine Chattel Mortgage, Security Agreement and Assignment of
Rents in form and substance reasonably satisfactory to Buyer dated the
Delivery Date relating to such Engine, by Fleet Capital Corporation as
secured party.
"PURCHASE DOCUMENTS" shall mean this Agreement, each Warranty Xxxx of
Sale, each Delivery Receipt, each Warranty Assignment Agreement and
Consent, each Mortgage Release, and all other documents executed and
delivered pursuant to such documents.
"PURCHASE PRICE" shall mean, with respect to each Engine, the purchase
price for such Engine as listed in EXHIBIT D hereto.
"SECURITY INTEREST" shall have the meaning giving in the Lease.
"SPECIAL FAA COUNSEL" shall mean Daugherty, Fowler, Peregrin & Xxxxxx,
Oklahoma City, Oklahoma.
"TAXES" shall mean any and all fees (including without limitation,
license, documentation and registration fees), taxes (including, without
limitation, income, gross receipts, sales, rental, use, value-added,
property (tangible or intangible), excise and stamp taxes), levies,
imposts, duties, recording charges or fees, charges, assessments or
withholding of any nature whatsoever imposed by any government or other
taxing authority of any jurisdiction, together with any and all penalties,
fines, or additions thereto or interest thereon, but excluding any taxes
which are imposed on or are measured by the income or capital gains of
Buyer.
"WARRANTY ASSIGNMENT AGREEMENT AND CONSENT" shall mean, with respect
to each Engine, the Warranty Assignment Agreement and Consent dated as of
the Delivery Date relating to such Engine, among Seller, as assignor,
Buyer, as assignee, and Engine Manufacturer, as consenting party, each in
substantially the form of Exhibit E hereof.
"WARRANTY XXXX OF SALE" shall mean, with respect to each Engine, the
Warranty Xxxx of Sale relating to such Engine dated as of the Delivery Date
relating to such Engine and executed by Seller in favor of Buyer in
substantially the form of EXHIBIT B hereto.
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SECTION 2. PURCHASE AND SALE OF ENGINES.
2.1 SALE OF ENGINES. Subject to the terms and conditions of this
Agreement, Seller agrees to sell all right, title and interest in each
Engine to Buyer and Buyer agrees to purchase such right, title and interest
from Seller.
2.2 PURCHASE PRICE. Subject to the terms and conditions of this
Agreement, Buyer shall make (or cause) payment of the Purchase Price for
each Engine on the Delivery Date relating to such Engine by wire transfer
to the following account (or such other account as the Seller shall specify
in a notice to the Buyer) located in the United States of America:
Bank: Fleet Bank, Hartford, CT
Account Name: Chautauqua Airlines, Inc.
Account Number: 000-000-0000
ABA Routing No.: 000-000-000
Reference: Sale Proceeds - Engines
Such payment shall be made in immediately available, freely transferable
and convertible Dollars without set-off, counterclaim or deduction of
whatsoever nature, with such transfer occurring immediately prior to the
filing of the Lease and the Engine Lease Supplement relating to such Engine
with the FAA.
2.3 WARRANTY ASSIGNMENT AGREEMENT. Effective upon Delivery of each
Engine, Seller hereby assigns (and shall cause to be assigned by the
Warranty Assignment Agreement and Consent relating to such Engine) to Buyer
all of its right, title and interest with respect to the Warranties (as
defined in the Warranty Assignment Agreement and Consent relating to such
Engine) subject to the terms of the Warranty Assignment Agreement and
Consent relating to such Engine.
SECTION 3. DELIVERY AND TRANSFER OF TITLE.
3.1 DELIVERY OF ENGINES. Seller shall deliver each Engine to Buyer on
the Delivery Date of such Engine at the Delivery Location.
3.2 DELIVERY CONDITIONS. Subject to the terms and conditions of this
Agreement, prior to or concurrent with Delivery of each Engine:
(a) All of the conditions set forth in Section 4.1 hereof shall
have been satisfied by Seller or waived by Buyer;
(b) All of the conditions set forth in Section 4.2 hereof shall
have been satisfied by Buyer or waived by Seller; and
(c) Concurrently with the tender of delivery of such Engine and
the transfer of title to such Engine by Seller to Buyer, Buyer shall
deliver to Seller the fully-executed Delivery Receipt of such Engine.
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3.3 TITLE AND RISK OF LOSS. Effective immediately upon the Delivery of
each Engine, title to such Engine and the risk of loss relating thereto
shall pass to Buyer.
SECTION 4. CONDITIONS TO PERFORMANCE.
4.1 CONDITIONS TO OBLIGATION OF BUYER TO PERFORM. Buyer's obligation
to pay (or cause to be paid) to Seller the Purchase Price for each Engine,
deliver to Seller the Delivery Receipt for such Engine, and otherwise
perform hereunder relating to such Engine shall be conditional upon, at or
before the Delivery of such Engine, the following events relating to such
Engine occurring and documents being delivered (in a form reasonably
acceptable to Buyer), unless waived by Buyer in writing:
(a) As of the Delivery Date of such Engine, the representations
of Seller set forth in the Purchase Documents relating to such Engine
shall be true and correct.
(b) Such Engine shall be located in the Delivery Location and
Buyer shall be reasonably satisfied that no sales, use, rental, value
added, goods and services, stamp, transfer or similar tax will be
required to be paid to any taxing authority in connection with (i) the
Delivery of such Engine or (ii) the delivery of such Engine by Buyer
to Seller under the Lease.
(c) An Event of Loss relating to such Engine shall not have
occurred and be continuing and no condition, event or circumstance
shall have occurred which with the lapse of time or making of relevant
determination would constitute an Event of Loss.
(d) Seller shall have removed any and all Security Interests
affecting title to such Engine (it being understood that the Security
Interest of an Existing Mortgage may be satisfied concurrently with
Delivery out of the proceeds of the Purchase Price for such Engine in
accordance with the terms of this Agreement).
(e) Seller and Lessee shall have delivered (or cause to be
delivered) in escrow to Special FAA Counsel the following duly
authorized, fully executed documents, and Seller and Lessee shall have
irrevocably instructed (or, in the case of any Mortgage Release,
caused Fleet Capital Corporation to irrevocably instruct) Special FAA
Counsel to file such documents with the FAA upon Buyer paying the
Purchase Price for such Engine pursuant to Section 2.2 hereof:
(i) the Lease;
(ii) the Lease Supplement relating to such Engine; and
(iii) Mortgage Release (if any) relating to such Engine.
(f) Seller shall have delivered in escrow to Buyer's counsel the
Warranty Xxxx of Sale and the Warranty Assignment Agreement and
Consent relating to such Engine and Seller shall have irrevocably
authorized such counsel to release to Buyer such documents
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upon Buyer paying (or causing the payment of) the Purchase Price
for such Engine pursuant to Section 2.2 hereof.
(g) The opinion of Special FAA Counsel relating to such Engine,
dated as of the Delivery Date of such Engine, shall have been provided
in the form and substance reasonably acceptable to Buyer.
(h) All of the conditions set forth in Part A of Schedule 3 of
the Lease relating to such Engine shall have been satisfied by Lessee
or waived by Lessor.
4.2 CONDITIONS TO OBLIGATION OF SELLER TO PERFORM. Seller's obligation
to sell each Engine to Buyer and to deliver to Buyer the Warranty Xxxx of
Sale relating to such Engine and to otherwise perform hereunder relating to
such Engine shall be conditional upon, at or before the Delivery of such
Engine, the following events relating to such Engine occurring and
documents being delivered (in a form reasonably acceptable to Seller),
unless waived by Seller in writing:
(a) Seller shall have received the Delivery Receipt of such
Engine as executed by Buyer;
(b) Seller shall have received full payment of the Purchase Price
for such Engine in accordance with Section 2.2 hereof;
(c) as of the Delivery Date of such Engine, the representations
of Buyer set forth in Section 7 hereof shall be true and correct;
(d) as of the Delivery of such Engine, such Engine shall have
been sold and delivered to the Seller pursuant to the terms of the
Manufacturer Purchase Agreement; and
(d) All of the conditions set forth in Part B of Schedule 3 of
the Lease relating to such Engine shall have been satisfied by Lessor
or waived by Lessee.
SECTION 5. TECHNICAL ACCEPTANCE. Buyer's execution and delivery to
Seller of the Delivery Receipt of each Engine shall evidence Buyer's
irrevocable acceptance of such Engine in its "as is, where is" condition,
subject to the terms and conditions of this Agreement.
SECTION 6. SELLER'S REPRESENTATIONS AND WARRANTIES.
6.1 SELLER'S REPRESENTATIONS OF AUTHORITY AND RELATED MATTERS.
Seller represents to the Buyer, as of its execution of this
Agreement and (unless otherwise provided in writing to the other party
hereto prior to the Delivery of each Engine) as of the Delivery Date
of such Engine, that:
(a) it is duly formed, validly existing under the laws of the
State of New York;
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(b) it has full power, authority and legal right to enter into,
and perform pursuant to the terms of, this Agreement and the
other Purchase Documents relating to such Engine to which it
is a party;
(c) the execution, delivery and performance of this Agreement
and the other Purchase Documents relating to such Engine to
which it is a party have been duly authorized by all
necessary action on its part and do not require any
approvals or consents except such approvals and consents as
have heretofore been duly obtained;
(d) the execution, delivery and performance of this Agreement
and the other Purchase Documents relating to such Engine to
which it is a party by Seller do not (i) contravene any law,
governmental rule, regulation, judgment or order applicable
to or binding on it, or (ii) contravene its certificate of
incorporation or bylaws, or (iii) contravene or result in a
default under any agreement to which it is a party or by
which it is bound, or (iv) contravene any provision of, or
constitute a default under, any indenture, mortgage,
contract or other instrument to which Seller is a party or
by which Seller or any of its assets are bound or are
subject;
(e) it is not a party to any agreement or instrument and it is
not subject to any charter or other restriction which would
have a material adverse effect on its ability to perform its
obligations under this Agreement and the other Purchase
Documents relating to such Engine to which it is a party;
(f) each of this Agreement and the other Purchase Documents
relating to such Engine to which it is a party constitutes a
legal, valid and binding obligation of such party
enforceable in accordance with the terms herein and therein,
except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, as well as by
principles of equity;
(g) such Engine has not suffered an Event of Loss; and
(h) as of the Delivery of such Engine, Seller is the sole legal
and beneficial owner of such Engine, free and clear of any
Security Interests other than the Existing Mortgage (if
any), which Existing Mortgage will be terminated and
released as of the Delivery Date by the Mortgage Release.
6.2 SELLER'S WARRANTY OF TITLE. Seller hereby warrants to the Buyer
that:
(a) immediately prior to the moment of title transfer of each
Engine, Seller shall have good and marketable title to such Engine free and
clear of any and all Security Interests, together with full power and
lawful authority to transfer such title to Buyer; and
(b) upon Delivery of each Engine to Buyer, Seller shall have
transferred to Buyer good and marketable title to such Engine free and
clear of any and all Security Interests other
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than those created by Buyer, and Seller hereby warrants and agrees to
defend such title against all claims and demands whatsoever and forever
other than those created by Buyer.
6.3 LIMITATION OF SELLER'S WARRANTIES.
(a) EXCEPT AS TO TITLE AS PROVIDED IN SECTION 6.2 HEREOF AND IN
THE WARRANTY XXXX OF SALE, EACH ENGINE IS BEING SOLD AND DELIVERED BY
SELLER TO BUYER AND PURCHASED AND ACCEPTED BY BUYER "AS IS" AND "WHERE
IS." SELLER MAKES NO, AND EXPRESSLY AND SPECIFICALLY DISCLAIMS (AND
BUYER EXPRESSLY AND SPECIFICALLY WAIVES AND DISCLAIMS) ANY,
REPRESENTATION, GUARANTEE, COVENANT, CONDITION OR WARRANTY OF ANY KIND
RELATING TO SUCH ENGINE, INCLUDING BUT NOT LIMITED TO THE
AIRWORTHINESS AND/OR CONDITION OF SUCH ENGINE, WHETHER EXPRESS OR
IMPLIED, ORAL OR WRITTEN, ARISING BY LAW OR OTHERWISE, IN CONTRACT OR
IN TORT, INCLUDING WITHOUT LIMITATION, WARRANTIES WITH RESPECT TO SUCH
ENGINE'S AIRWORTHINESS, MERCHANTABILITY, QUALITY, FITNESS FOR ANY
PARTICULAR USE, PURPOSE, DESIGN, CONDITION, VALUE, QUALITY,
DURABILITY, OR AS TO THE ABSENCE OF LATENT, INHERENT OR OTHER DEFECTS
(WHETHER OR NOT DISCOVERABLE) OR AS TO THE ABSENCE OF ANY INFRINGEMENT
OF ANY PATENT, DESIGN, COPYRIGHT OR OTHER PROPRIETARY RIGHT OR THOSE
ARISING BY STATUTE OR OTHERWISE IN LAW FROM THE COURSE OF DEALING OR
USAGE OF TRADE. BUYER AGREES AND ACKNOWLEDGES THAT IN NO EVENT SHALL
SELLER BE LIABLE FOR INJURIES TO PERSONS OR PROPERTIES, FOR LOSS OF
USE, REVENUES OR PROFIT WITH RESPECT TO SUCH ENGINE OR ANY LIABILITY
OF BUYER FOR ANY DIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES.
(b) NO AGREEMENT ALTERING OR EXTENDING SELLER'S LIABILITY FOR
WARRANTIES SHALL BE BINDING UPON SELLER UNLESS IN WRITING AND EXECUTED
BY A DULY AUTHORIZED OFFICER OR REPRESENTATIVE OF SELLER.
SECTION 7. BUYER'S REPRESENTATIONS AND WARRANTIES.
7.1 BUYER REPRESENTATIONS OF AUTHORITY AND RELATED MATTERS.
Buyer represents to the Seller, as of its execution of this
Agreement and (unless otherwise provided in writing to the other party
hereto prior to the Delivery of each Engine) as of the Delivery Date
of such Engine, that:
(a) it is duly formed and validly existing pursuant to the laws
of the State of Delaware.
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(b) it has full power, authority and legal right to enter into,
and perform pursuant to the terms of, this Agreement and the
other Purchase Documents relating to such Engine to which it
is a party;
(c) the execution, delivery and performance of this Agreement
and the other Purchase Documents relating to such Engine to
which it is a party have been duly authorized by all
necessary action on its part and do not require any
approvals or consents except such approvals and consents as
have heretofore been duly obtained;
(d) the execution, delivery and performance of this Agreement
and the other Purchase Documents relating to such Engine to
which it is a party by Buyer do not (i) contravene any law,
governmental rule, regulation, judgment or order applicable
to or binding on it, or (ii) contravene its certificate of
incorporation or bylaws, or (iii) contravene or result in a
default under any agreement to which it is a party or by
which it is bound, or (iv) contravene any provision of, or
constitute a default under, any indenture, mortgage,
contract or other instrument to which Buyer is a party or by
which Buyer or any of its assets are bound or are subject;
(e) it is not a party to any agreement or instrument and it is
not subject to any charter or other restriction which would
have a material adverse effect on its ability to perform its
obligations under this Agreement and the other Purchase
Documents relating to such Engine to which it is a party;
and
(f) each of this Agreement and the other Purchase Documents
relating to such Engine to which it is a party constitutes a
legal, valid and binding obligation of such party
enforceable in accordance with the terms herein and therein,
except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, as well as by
principles of equity.
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SECTION 8. TAXES AND INDEMNITIES.
8.1 TAXES.
(a) Each of the parties hereto shall act in good faith and
cooperate with one another to ensure that the amount of Taxes which
might arise as a result of this Agreement, any of the other Purchase
Documents, or the performance hereof or thereof are minimized. Seller
shall pay (or cause to be paid) in a timely and proper manner, and
shall indemnify Buyer and its affiliates, successors and assigns
(within ten Business Days after receipt of written demand therefor) on
an after tax basis for, all Taxes required by any applicable law (or
any administrative or judicial interpretation thereof) to be paid in
connection with the Delivery, and Seller shall prepare and file (or
cause to be prepared and filed) in a timely and proper manner all
reports, returns or other documents required by any applicable law (or
any administrative or judicial interpretation thereof) to be filed
with respect to such Taxes. Notwithstanding the foregoing, Seller
shall not have any liability pursuant to this Agreement for, and shall
not be obligated to indemnify Buyer pursuant to this Agreement against
any Taxes which: (i) are in the nature of property or ad valorem taxes
not imposed on the basis of the sale of the Engines and are imposed
for periods after the Delivery, (ii) are imposed upon the use of the
Engines subsequent to the sale of the Engines, (iii) are attributable
to any financing obtained by Buyer for the acquisition of the Engines
or the recordation or provision of any security interest therefor and
are imposed for periods after the Delivery, (iv) are attributable to
any event or occurrence or which otherwise accrues subsequent to the
sale of the Engines, (v) would not have been imposed but for the form
of the organization, capitalization, location of the businesses of or
the conduct of the business activities (other than the activities
contemplated by this Agreement) or ownership of properties by the
Buyer in the jurisdiction of the taxing authority imposing such Taxes,
or (vi) any Lessor Taxes (as defined in the CTA). For the avoidance of
doubt, (A) nothing contained in this Agreement shall modify or
otherwise affect any liability for Taxes that Seller may have in its
capacity as Lessee pursuant to the CTA or the Lease, and (B) in no
event shall the Buyer be able to recover by way of indemnity the same
Tax under both this Agreement and the CTA or the Lease.
(b) The parties hereto expressly agree that the provisions of
Sections 5.9 and 5.10 of the CTA shall apply MUTATIS MUTANDIS in
respect of any Taxes and indemnification provided for under this
Section 8.1.
8.2 INDEMNITIES.
(a) Except as provided in Section 8.2(b) below, Seller agrees to
assume liability for and to indemnify Buyer or any of its officers,
employees or agents (the "Indemnitees") (other than solely in its
capacity as a manufacturer of the Engine) against and agrees to pay on
demand any and all Losses (as defined in the Lease) which Buyer may
suffer or incur at any time, whether directly or indirectly, arising
out of, related to or in any way connected with:
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(i) the purchase hereunder, ownership, maintenance, repair,
possession, import, export, registration, storage, modification,
leasing, insurance, inspection, testing, design, sub-leasing,
use, condition or other matters relating to the Engines or any
part thereof (regardless of whether such Losses are based on
strict liability in tort, any act or omission, including the
negligence, of any Indemnitee, or otherwise); or
(ii) the design of any article or material in the any Engine
or any Part or its operation, including any defect in design and
regardless of whether it is discoverable, and any infringement of
patent, copyright, trademark, design or other proprietary right
claimed by any Person or a breach of any obligation of
confidentiality claimed to be owed to any Person.
(b) Seller is not required to indemnify any particular Indemnitee
under Section 8.2(a) (without, however, limiting Seller's obligations
as lessee under the Lease), to the extent a particular Loss:
(i) arises out of any act, omission, event or circumstance
occurring after Delivery;
(ii) is caused by the gross negligence or wilful misconduct of
that Indemnitee;
(iii) is the result of failure by Buyer to comply with any of its
express obligations under this Agreement (unless such
failure is caused by failure by Seller to comply with any
of its express obligations under this Agreement) or any
representation or warranty given by Buyer not being true
and correct;
(iv) is related to any Taxes;
(v) constitutes ordinary and usual operating or overhead
expenses of such Indemnitee (other than where such expense
is caused by the occurrence of any breach by Seller of its
obligations under this Agreement);
(vi) is a Loss which Buyer and Seller have agreed in writing is
to be excluded; or
(vii) a Loss relating to, resulting from, arising out of or in
connection with a "prohibited transaction" within the
meaning of Section 406 of ERISA (as defined in the Lease)
or Section 4975(c)(1) of the Internal Revenue Code of 1986
resulting from the direct or indirect use of assets or any
ERISA Plan to acquire or hold Buyer's interest in the
Engine or in the case of any transferee of the Buyer, to
purchase the Engine from the Buyer.
(c) The parties hereto expressly agree that the provisions of
Sections 10(c), (d), (e) and (f) of the CTA shall apply MUTATIS
MUTANDIS in respect of any Loss and indemnification provided for under
this Section 8.2.
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SECTION 9. TERMINATION.
Unless the parties hereto otherwise agree, this Agreement shall terminate
as to an Engine automatically upon the occurrence of an Event of Loss with
respect to such Engine prior to the Delivery of such Engine. Otherwise, this
Agreement may be terminated as to an Engine only as follows:
(a) by written agreement of all parties hereto at any time prior to
the Delivery of such Engine;
(b) by Buyer, if the conditions specified in Section 4.1 hereof
relating to such Engine have not been waived by Buyer or
satisfied by the Delivery Date of such Engine; and
(c) by Seller, if the conditions specified in Section 4.2 hereof
relating to such Engine have not been waived by Seller or
satisfied by the Delivery Date of such Engine.
Upon any such termination relating to any such Engine, this Agreement
relating to such Engine shall be of no further force and effect.
SECTION 10. FURTHER COOPERATION.
The parties hereto agree to fully cooperate with one another, and to
execute and deliver whatever documents are reasonably required, so as to
effectuate the terms of this Agreement.
SECTION 11. MISCELLANEOUS.
11.1 NOTICES. Unless otherwise specified in writing by the parties hereto,
all notices, approvals, requests, consents, and other communications given
pursuant to this Agreement (a) shall be in writing, (b) shall be sent by
recognized overnight courier service or facsimile, (c) shall be deemed delivered
when actually received or when such delivery is refused, and (d) shall be made
to the respective addresses set forth in the Lease or to such other address or
telecopy number as any such party may designate pursuant to the Lease.
11.2 EXHIBITS. All Exhibits attached to this Agreement shall be deemed to
be incorporated and made a part of this Agreement, and form an integral part
herein.
11.3 ASSIGNMENTS. This Agreement, and the rights and obligations of the
parties hereunder, shall not be assignable or delegable by any party hereto
without the prior written consent of the other party (which consent shall not be
unreasonably withheld). This Agreement, and the rights and obligations of the
parties hereunder, shall be binding upon and inure to the benefit of each of the
parties, their respective successors and permitted assigns, and legal
representatives.
11.4 CAPTIONS. All captions and section headings used in this Agreement are
for convenience only and shall not in any manner be deemed to limit or restrict
the context of the article or section to which they relate.
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11.5 BROKERS' COMMISSIONS. Each of the parties hereby represents and
warrants to the other that it has not paid, agreed to pay or caused to be paid
directly or indirectly in any form, any commission, percentage, contingent fee,
brokerage or other similar payments of any kind, in connection with the
establishment or operation of this Agreement, to any Person (other than fees
payable to legal advisers). Each party agrees to indemnify and hold the other
harmless from and against any and all claims, suits, damages, costs and expenses
(including, reasonable legal fees and expenses) asserted by any agent, broker or
other third party for any commission or compensation of any nature whatsoever
based upon this Agreement or the Engines, if such claim, suit, damage, cost or
expense arises out of any breach by the indemnifying party, its employees or
agents of this Section 10.5.
11.6 APPLICABLE LAW, JURISDICTION AND WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT AND THE OTHER PURCHASE DOCUMENTS SHALL BE GOVERNED
BY AND BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
(b) ALL ACTIONS OR PROCEEDINGS ARISING DIRECTLY OR INDIRECTLY OUT OF
THIS AGREEMENT OR ANY OF THE OTHER PURCHASE DOCUMENTS SHALL BE SUBJECT TO THE
JURISDICTION AND VENUE OF THE CALIFORNIA STATE COURTS SITTING IN THE CITY OF SAN
FRANCISCO, CALIFORNIA OR THE UNITED STATES DISTRICT COURT FOR THE NORTHERN
DISTRICT OF CALIFORNIA. THE PARTIES HERETO HEREBY EXPRESSLY SUBMIT AND CONSENT
IN ADVANCE TO SUCH JURISDICTION AND VENUE IN EITHER OF SUCH COURTS, AND AGREE
THAT JURISDICTION AND VENUE ARE PROPER IN SUCH COURTS AND THAT SUCH VENUE IS NOT
INCONVENIENT. THE CHOICE OF JURISDICTION AND FORUM SET FORTH IN THIS SECTION
SHALL NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT, BY ANY PARTY HERETO, OF A
JUDGMENT IN ANY OTHER APPROPRIATE JURISDICTION.
(c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HERETO
HEREBY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON,
ARISING OUT OF, OR IN ANY WAY RELATING TO, THIS AGREEMENT OR ANY OF THE OTHER
PURCHASE DOCUMENTS, WHETHER SUCH ACTION IS BASED ON BREACH OF CONTRACT, TORT, OR
ANY OTHER LEGAL OR EQUITABLE THEORY.
11.7 ENTIRE AGREEMENT. This Agreement (together with the Exhibits hereto
and the other Purchase Documents) shall constitute the entire agreement among
the parties hereto with respect to the transactions contemplated herein,
supersedes in its entirety any prior agreements, whether oral or in writing, of
the parties hereto, and shall not in any manner be supplemented, amended or
modified except by a written instrument executed on behalf of the parties by
their duly authorized representatives.
11.8 WAIVERS. The waiver by any party hereto of performance of any term,
covenant or condition of this Agreement in a particular instance shall not
constitute a waiver of any subsequent
13
breach or preclude such party from thereafter demanding performance thereof
according to the provisions herein.
11.9 COUNTERPARTS. This Agreement may be signed in one or more
counterparts, each of which shall be an original, but all of which together
shall constitute the same instrument.
11.10 EXPENSES. Each party hereunder hereby agrees to be responsible for
and to pay the costs and expenses incurred by it in connection with the
negotiation and drafting of this Agreement and the consummation of the
transactions contemplated hereby, including attorneys' fees and expenses.
11.11 SEVERABILITY. If any provision hereof should be held invalid, illegal
or unenforceable in any respect in any jurisdiction, then, to the fullest extent
permitted by law, (i) all other provisions hereof shall remain in full force and
effect in such jurisdiction and shall be construed in order to carry out the
intentions of the parties hereto as nearly as may be possible, and (ii) such
invalidity, illegality or unenforceability shall not affect the validity,
legality or enforceability of such provision in any other jurisdiction.
11.12 CONFIDENTIALITY. The parties hereto expressly agree that the
confidentiality provisions set forth in Schedule B of the Engine Lease Agreement
(as defined in the CTA) shall apply mutatis mutandis in respect of any
disclosure of the contents of this Agreement.
11.13 SURVIVAL. Notwithstanding anything contained herein to the contrary,
all agreements, indemnities, representations and warranties contained in this
Agreement shall survive the Delivery Date and the expiration or other
termination hereof.
[SIGNATURE PAGE FOLLOWS]
14
IN WITNESS WHEREOF, the parties have caused this Engine Purchase Agreement
to be executed by their duly authorized representatives as of the date first
stated above.
CHAUTAUQUA AIRLINES, INC., a New York
corporation (Seller)
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
--------------------------------------
Title: Vice President
--------------------------------------
AVIATION FINANCIAL SERVICES INC., a
Delaware corporation (Buyer)
By: /s/ Xxxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxx
--------------------------------------
Title: Vice President
-------------------------------------
15
EXHIBIT A
TO
ENGINE PURCHASE AGREEMENT
-------------------------------------------------------------------------------
ATTACHED FORM OF DELIVERY RECEIPT
-------------------------------------------------------------------------------
DELIVERY RECEIPT
THE UNDERSIGNED, on behalf of and as the duly authorized agent for AVIATION
FINANCIAL SERVICES INC., a Delaware corporation ("Buyer"), hereby acknowledges
that CHAUTAUQUA AIRLINES, INC., a New York corporation ("Seller"), in
accordance with the terms of that certain Engine Purchase Agreement dated as of
the date hereof between Buyer and Seller (the "Purchase Agreement"), has, at
_____ a.m./p.m. (Eastern Standard Time) this ____ day of __________, 2001
delivered to Buyer at the following described aircraft engine(s)(the "Engines"):
(a) the following [_____] Engine(s):
MANUFACTURER: Rolls-Royce Corporation
MODEL NUMBER: AE3007A1P
SERIAL NUMBERS: CAE 311434
CAE 311206
CAE 311635
CAE 311794
CAE 311908
CAE 312071
CAE 312096
CAE 311___
CAE 311___
(c) together with (as the following terms are defined in the Purchase
Agreement) (i) all appliances, parts, instruments, accessories,
furnishings and all other items of equipment incorporated in,
installed on, appurtenant to, or otherwise included with such
Engine(s) on the Delivery Date of such Engine(s), (ii) the Engine
Documents relating to such Engine(s) as itemized in the Schedule
attached to this Delivery Receipt, and (iii) all other components of
such Engine(s).
Buyer hereby confirms that it is accepting delivery of the Engine(s) in its
"as is, where is" condition, subject to the terms, conditions and warranties
(and limitations on warranties) set forth in the Purchase Agreement and the
"Warranty Xxxx of Sale" (as defined by the Purchase Agreement).
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned has executed this Delivery Receipt as
of the date referred to above.
AVIATION FINANCIAL SERVICES INC.,
a Delaware corporation (Buyer)
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxx
---------------------------------------
Title: Vice President
--------------------------------------
Schedule to Delivery Receipt
LIST OF ENGINE DOCUMENTS
EXHIBIT B
TO
ENGINE PURCHASE AGREEMENT
-------------------------------------------------------------------------------
ATTACHED FORM OF WARRANTY XXXX OF SALE
-------------------------------------------------------------------------------
WARRANTY XXXX OF SALE
DATE: __________, 2001
CHAUTAUQUA AIRLINES, INC., A NEW YORK CORPORATION ("Seller") holds legal
and beneficial title to the following described aircraft engines (the
"Engines"):
(a) the following [_____] aircraft engines:
MANUFACTURER: Rolls-Royce Corporation
MODEL NUMBER: AE3007A1P
SERIAL NUMBERS: CAE 311434
CAE 311206
CAE 311635
CAE 311794
CAE 311908
CAE 312071
CAE 312096
CAE 311___
CAE 311___
(b) together with (as the following terms are defined in the Purchase
Agreement) (i) all appliances, parts, instruments, accessories,
furnishings and all other items of equipment incorporated in,
installed on, appurtenant to, or otherwise included with such
Engine(s) on the Delivery Date of such Engine(s), (ii) the Engine
Documents relating to such Engine(s), and (iii) all other components
of such Engine(s).
Seller hereby confirms that, on this date, it tendered the Engine(s) for
delivery to AVIATION FINANCIAL SERVICES INC., A DELAWARE CORPORATION, pursuant
to that certain Engine Purchase Agreement dated as of December 18, 2001 between
Buyer and Seller (the "Purchase Agreement"), and that Buyer accepted such tender
by executing and delivering to Seller the "Delivery Receipt" (as defined in the
Purchase Agreement).
Seller, for good and valuable consideration, the receipt, adequacy and
legal sufficiency of which are hereby acknowledged, hereby grants, conveys,
transfers, bargains, sells, delivers and sets over unto Buyer all right, title
and interest in and to the Engine(s).
Seller hereby warrants to Buyer and its successors and assigns that, on the
date hereof, it is the lawful owner of good, marketable, valid legal title in
and to the Engine(s), and that such title is hereby conveyed free and clear of
any and all security interests, liens, claims,
charges or encumbrances of any nature whatsoever. Seller covenants and agrees to
warrant and defend such title against all claims and demands whatsoever and
forever.
The terms of the Purchase Agreement, including but not limited to Seller's
representations, warranties, covenants, agreements and indemnities relating to
the Engines, are incorporated herein by this reference. In the event of any
conflict or inconsistency between the terms of the Purchase Agreement and the
terms hereof, the terms of the Purchase Agreement shall govern.
EACH ENGINE IS BEING SOLD ON AN "AS-IS, WHERE-IS" BASIS, AND SELLER MAKES
NO REPRESENTATIONS OR WARRANTIES WHATSOEVER WITH RESPECT TO SUCH ENGINE OR THE
TRANSACTIONS CONTEMPLATED BY THE PURCHASE AGREEMENT EXCEPT AS EXPRESSLY SET
FORTH HEREIN OR IN THE PURCHASE AGREEMENT.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, Seller has caused this Warranty Xxxx of Sale to be
executed by its duly authorized representative as of the date first above
written.
CHAUTAUQUA AIRLINES, INC. ("Seller")
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
---------------------------------------
Title: Vice President
--------------------------------------
EXHIBIT C
TO
ENGINE PURCHASE AGREEMENT
================================================================================
ATTACHED DESCRIPTION OF ENGINES
TO BE DELIVERED BY SELLER
--------------------------------------------------------------------------------
DESCRIPTION OF ENGINES
NINE (9) ROLLS-ROYCE MODEL AE3007A1P AIRCRAFT ENGINES
MANUFACTURER: Rolls-Royce Corporation
MODEL NUMBER: AE3007A1P
SERIAL NUMBERS: CAE 311434
CAE 311206
CAE 311635
CAE 311794
CAE 311908
CAE 312071
CAE 312096
XXX
XXX
EXHIBIT D
TO
ENGINE PURCHASE AGREEMENT
================================================================================
ATTACHED PURCHASE PRICE OF ENGINES
TO BE PAID BY BUYER
================================================================================
PURCHASE PRICE OF EACH ENGINE
ENGINE PURCHASE PRICE
CAE 311434 [*]
CAE 311206 [*]
CAE 311635 [*]
CAE 311794 [*]
CAE 311908 [*]
CAE 312071 [*]
CAE 312096 [*]
TBD [*]
TBD [*]
--------------
* Confidential
EXHIBIT E
TO
ENGINE PURCHASE AGREEMENT
================================================================================
ATTACHED FORM OF
WARRANTY ASSIGNMENT AGREEMENT AND CONSENT
================================================================================
FORM OF
WARRANTY ASSIGNMENT AGREEMENT AND CONSENT
