NORTHWEST AIRLINES CORPORATION
NORTHWEST AIRLINES, INC.
and
STATE STREET BANK AND TRUST COMPANY,
as Trustee
PASS THROUGH TRUST AGREEMENT
Dated as of June 3, 1996
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
Section 1.01. Definitions................................................. 2
Section 1.02. Compliance Certificates and Opinions........................ 9
Section 1.03. Form of Documents Delivered to Trustee...................... 9
Section 1.04. Acts of Certificateholders.................................. 10
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
Section 2.01. Amount Unlimited; Issuable in Series........................ 11
Section 2.02. Acquisition of Equipment Notes.............................. 13
Section 2.03. Acceptance by Trustee....................................... 14
Section 2.04. Limitation of Powers........................................ 14
ARTICLE III
THE CERTIFICATES
Section 3.01. Form, Denomination and Execution of Certificates............ 15
Section 3.02. Authentication of Certificates.............................. 15
Section 3.03. Temporary Certificates...................................... 15
Section 3.04. Registration of Transfer and Exchange of Certificates....... 16
Section 3.05. Mutilated, Destroyed, Lost or Stolen Certificates........... 16
Section 3.06. Persons Deemed Owners....................................... 17
Section 3.07. Cancellation................................................ 17
Section 3.08. Limitation of Liability for Payments........................ 17
Section 3.09. Book-Entry and Definitive Certificates...................... 17
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
Section 4.01. Certificate Account and Special Payments Account............ 19
Section 4.02. Distributions from Certificate Account and Special Payments
Account..................................................... 19
Section 4.03. Statements to Certificateholders............................ 20
Section 4.04. Investment of Special Payment Moneys........................ 21
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ARTICLE V
THE COMPANY
Section 5.01. Maintenance of Corporate Existence.......................... 21
Section 5.02. Consolidation, Merger, etc.................................. 22
ARTICLE VI
DEFAULT
Section 6.01. Events of Default........................................... 23
Section 6.02. Incidents of Sale of Equipment Notes........................ 23
Section 6.03. Judicial Proceedings Instituted by Trustee; Trustee May Bring
Suit........................................................ 24
Section 6.04. Control by Certificateholders............................... 24
Section 6.05. Waiver of Past Defaults..................................... 24
Section 6.06. Right of Certificateholders to Receive Payments Not To Be
Impaired.................................................... 25
Section 6.07. Certificateholders May Not Bring Suit Except Under Certain
Conditions.................................................. 25
Section 6.08. Remedies Cumulative......................................... 26
Section 6.09. Undertaking for Costs....................................... 26
ARTICLE VII
THE TRUSTEE
Section 7.01. Notice of Defaults.......................................... 26
Section 7.02. Certain Rights of Trustee................................... 26
Section 7.03. Not Responsible for Recitals or Issuance of Certificates.... 27
Section 7.04. May Hold Certificates....................................... 28
Section 7.05. Money Held in Trust......................................... 28
Section 7.06. Compensation and Reimbursement.............................. 28
Section 7.07. Corporate Trustee Required; Eligibility..................... 29
Section 7.08. Resignation and Removal; Appointment of Successor........... 29
Section 7.09. Acceptance of Appointment by Successor...................... 31
Section 7.10. Merger, Conversion, Consolidation or Succession to Business. 31
Section 7.11. Maintenance of Agencies..................................... 32
Section 7.12. Money for Certificate Payments to Be Held in Trust.......... 33
Section 7.13. Registration of Equipment Notes in Trustee's Name........... 33
Section 7.14. Representations and Warranties of Trustee................... 33
Section 7.15. Withholding Taxes; Information Reporting.................... 34
Section 7.16. Trustee's Liens............................................. 34
Section 7.17. Preferential Collection of Claims........................... 34
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE
Section 8.01. The Company to Furnish Trustee with Names and Addresses of
Certificateholders.......................................... 35
Section 8.02. Preservation of Information; Communications to
Certificateholders.......................................... 35
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Section 8.03. Reports by Trustee.......................................... 35
Section 8.04. Reports by the Guarantor and Company........................ 35
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
Section 9.01. Supplemental Agreements Without Consent of
Certificateholders.......................................... 36
Section 9.02. Supplemental Agreements with Consent of Certificateholders.. 37
Section 9.03. Documents Affecting Immunity or Indemnity................... 38
Section 9.04. Execution of Supplemental Agreements........................ 38
Section 9.05. Effect of Supplemental Agreements........................... 38
Section 9.06. Conformity with Trust Indenture Act......................... 38
Section 9.07. Reference in Certificates to Supplemental Agreements........ 38
ARTICLE X
AMENDMENTS TO INDENTURE AND NOTE DOCUMENTS
Section 10.01. Amendments and Supplements to Indenture and Other Note
Documents................................................... 38
ARTICLE XI
TERMINATION OF TRUSTS
Section 11.01. Termination of the Trusts.................................. 39
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Limitation on Rights of Certificateholders................. 40
Section 12.02. Liabilities of Certificateholders.......................... 40
Section 12.03. Certificates Nonassessable and Fully Paid.................. 40
Section 12.04. Registration of Equipment Notes in Name of Subordination
Agent...................................................... 40
Section 12.05. Notices.................................................... 40
Section 12.06. Governing Law.............................................. 41
Section 12.07. Severability of Provisions................................. 41
Section 12.08. Trust Indenture Act Controls............................... 42
Section 12.09. Effect of Headings and Table of Contents................... 42
Section 12.10. Successors and Assigns..................................... 42
Section 12.11. Benefits of Agreement...................................... 42
Section 12.12. Legal Holidays............................................. 42
Section 12.13. Counterparts............................................... 42
Section 12.14. Communication by Certificateholders with Other
Certificateholders......................................... 42
Exhibit A - Form of Certificate
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Reconciliation and tie between Pass Through Trust Agreement dated as of June 3,
1996 and the Trust Indenture Act of 1939. This reconciliation does not
constitute part of the Pass Through Trust Agreement.
Trust Indenture Act Pass Through Trust
of 1939 Section Agreement Section
-------------------- -------------------
310(a)(1) 7.07
(a)(2) 7.07
312(a) 3.09; 8.01; 8.02
313(a) 7.06
314(a) 8.04(a) - (c)
(a)(4) 8.04(d)
(c)(1) 1.02
(c)(2) 1.02
(d)(1) 7.12
11.01
(d)(2) 7.12; 11.01
(d)(3) 2.01
(e) 1.02
315(b) 7.01
316(a)(last sentence) 1.01
(a)(1)(a) 6.04
(a)(1)(b) 6.05
(b) 6.06
(c) 1.04(d)
317(a)(1) 6.03
(b) 7.12
318(a) 12.06
This PASS THROUGH TRUST AGREEMENT, dated as of June 3, 1996, among
Northwest Airlines Corporation, a Delaware corporation (the "Guarantor"),
Northwest Airlines, Inc., a Minnesota corporation (the "Company"), and State
Street Bank and Trust Company, a Massachusetts trust company, as Trustee, is
made with respect to the formation from time to time of separate Northwest
Airlines Pass Through Trusts, and the issuance from time to time of separate
series of Pass Through Certificates representing fractional undivided interests
in the respective Trusts.
WITNESSETH:
WHEREAS, from time to time the Guarantor, the Company and the Trustee may
enter into a Trust Supplement (this and certain other defined terms used herein
are defined in Section 1.01) pursuant to which the Trustee shall declare the
creation of a separate Trust for the benefit of the Holders of the series of
Certificates to be issued in respect of such Trust, and the initial Holders of
the Certificates of such series, as the grantors of such Trust, by their
respective acceptances of the Certificates of such series, shall join in the
creation of such Trust with the Trustee;
WHEREAS, all Certificates to be issued in respect of each separate Trust
will be issued as a separate series pursuant to this Agreement, will evidence
fractional undivided interests in such Trust and will have no rights, benefits
or interests in respect of any other separate Trust or the property held
therein, subject, however, to the provisions of any Intercreditor Agreement to
which one or more Trusts may be a party;
WHEREAS, from time to time, pursuant to the terms and conditions of this
Agreement with respect to each separate Trust formed hereunder, the Trustee on
behalf of such Trust shall purchase one or more issues of Equipment Notes having
the same interest rate as, and final maturity dates not later than the final
Regular Distribution Date of, the series of Certificates issued in respect of
such Trust and shall hold such Equipment Notes in trust for the benefit of the
Certificateholders of such Trust;
WHEREAS, to facilitate the sale of Equipment Notes to, and the purchase of
Equipment Notes by, the Trustee on behalf of each Trust created from time to
time pursuant to this Agreement, (i) the Company as the "issuer", as such term
is defined in and solely for purposes of the Securities Act of 1933, as amended,
of the Certificates to be issued in respect of each Trust and as the "obligor",
as such term is defined in and solely for purposes of the Trust Indenture Act of
1939, as amended, and (ii) the Guarantor have each duly authorized the execution
and delivery of this Basic Agreement and each Trust Supplement with respect to
all such Certificates and are undertaking to perform certain administrative and
ministerial duties hereunder and are also undertaking to pay the fees and
expenses of the Trustee;
WHEREAS, this Basic Agreement, as supplemented from time to time, is
subject to the provisions of the Trust Indenture Act of 1939, as amended, and
shall, to the extent applicable, be governed by such provisions;
NOW THEREFORE, in consideration of the mutual agreements herein contained,
and of other good and valuable consideration the receipt and adequacy of which
are hereby acknowledged, the parties hereto agree as follows:
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ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. For all purposes of this Basic Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(1) the terms used herein that are defined in this Article have
the meanings assigned to them in this Article, and include the plural as
well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein:
(3) all references in this Basic Agreement to designated
"Articles", "Sections" and other subdivisions are to the designated
Articles, Sections and other subdivisions of this Basic Agreement;
(4) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Basic Agreement as a whole and not to any
particular Article, Section or other subdivision; and
(5) the term "this Agreement" (as distinguished from "this Basic
Agreement") refers, unless the context otherwise requires, to this Basic
Agreement as supplemented by the Trust Supplement creating a particular
Trust and establishing the series of Certificates issued or to be issued
in respect thereof, with reference to such Trust and such series of
Certificates, as this Basic Agreement as so supplemented may be further
supplemented with respect to such Trust and such series of Certificates.
ACT: With respect to any Certificateholder has the meaning specified in
Section 1.04.
AFFILIATE: With respect to any specified Person, means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
AIRCRAFT: Means one or more aircraft, including engines therefor, owned
by or leased to the Company and securing one or more Equipment Notes.
AUTHORIZED AGENT: With respect to the Certificates of any series, means
any Paying Agent or Registrar for the Certificates of such series.
BASIC AGREEMENT: Means this Pass Through Trust Agreement, as the same
may from time to time be supplemented, amended or modified, but does not include
any Trust Supplement.
BOOK-ENTRY CERTIFICATES: With respect to the Certificates of any
series, means a beneficial interest in the Certificates of such series,
ownership and transfers of which shall be made through book entries as described
in Section 3.09.
3
BUSINESS DAY: With respect to the Certificates of any series, means any
day other than a Saturday, a Sunday or a day on which commercial banks are
required or authorized to close in Minneapolis, Minnesota or New York, New York;
and, so long as any such Certificate is outstanding, a city and state in which
the Trustee or any related Loan Trustee maintains its Corporate Trust Office or
receives and disburses funds.
CERTIFICATE: Means any one of the certificates executed and
authenticated by the Trustee, substantially in the form of Exhibit A hereto.
CERTIFICATE ACCOUNT: With respect to the Certificates of any series,
means the account or accounts created and maintained for such series pursuant to
Section 4.01(a) and the related Trust Supplement.
CERTIFICATEHOLDER OR HOLDER: With respect to the Certificates of any
series, means the Person in whose name a Certificate of such series is
registered in the Register for Certificates of such series.
CERTIFICATE OWNER: With respect to the Certificates of any series,
means, for purposes of Section 3.09, the Person who owns a Book-Entry
Certificate of such series.
CLEARING AGENCY: Means an organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended.
CLEARING AGENCY PARTICIPANT: Means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects, directly or indirectly, book-entry transfers and pledges of
securities deposited with the Clearing Agency.
COMPANY: Means Northwest Airlines, Inc., a Minnesota corporation, or
its successor in interest pursuant to Section 5.02.
CONTROLLING PARTY: Means the Person entitled to act as such pursuant to
the terms of any Intercreditor Agreement.
CORPORATE TRUST OFFICE: With respect to the Trustee or any Loan
Trustee, means the office of such trustee in the city at which at any particular
time its corporate trust business shall be principally administered.
CUT-OFF DATE: With respect to the Certificates of any series, means the
date designated as such in the Trust Supplement establishing such series.
DEFINITIVE CERTIFICATES: With respect to the Certificate of any series,
has the meaning specified in Section 3.09.
DIRECTION: Has the meaning specified in Section 1.04(c).
EQUIPMENT NOTE: With respect to the Certificates of any series, has the
meaning given to "Secured Certificate" in the related Indenture.
ERISA: Means the Employee Retirement Income Security Act of 1974, as
amended from time to time, or any successor federal statute.
4
ESCROW ACCOUNT: With respect to the Certificates of any series, has the
meaning specified in Section 2.02(b).
ESCROWED FUNDS: With respect to any Trust, has the meaning specified in
Section 2.02(b).
EVENT OF DEFAULT: Means, in respect of any Trust, the occurrence of an
Indenture Default under any Indenture pursuant to which Equipment Notes held by
such Trust were issued.
FRACTIONAL UNDIVIDED INTEREST: Means the fractional undivided interest
in a Trust that is evidenced by a Certificate relating to such Trust.
GUARANTOR: Means Northwest Airlines Corporation, a Delaware
corporation, or its successor in interest.
INDENTURE: With respect to any Trust, means each of the one or more
separate trust indenture and security agreements described in, or on a schedule
attached to, this Agreement which relates to an issue of Equipment Notes to be
held in such Trust and an indenture having substantially the same terms and
conditions as such trust indenture and security agreement and which relates to a
Substitute Aircraft; as each such agreement may be amended or supplemented in
accordance with its respective terms; and INDENTURES means all of such
agreements.
INDENTURE DEFAULT: With respect to any Indenture, means any Indenture
Event of Default (as such term is defined in such Indenture).
INITIAL REGULAR DISTRIBUTION DATE: With respect to the Certificates of
any series, means the first Regular Distribution Date on which a Scheduled
Payment is to be made.
INTERCREDITOR AGREEMENT: Means any agreement by and among one or more
Trusts, one or more Liquidity Providers and a Subordination Agent providing for
the distribution of payments made in respect of Equipment Notes held by such
Trusts.
ISSUANCE DATE: With respect to the Certificates of any series, means
the date of the issuance of such Certificates.
LEASE: Means any lease between an Owner Trustee, as the lessor, and the
Company, as the lessee, referred to in the related Indenture, as each such lease
may be amended or supplemented in accordance with its respective terms; and
LEASES means all such Leases.
LETTER OF REPRESENTATIONS: With respect to the Certificates of any
series, means the agreement among the Company, the Trustee and the initial
Clearing Agency substantially in the form attached as an Exhibit to the related
Trust Supplement.
LIQUIDITY FACILITY: With respect to the Certificates of any Series,
means any revolving credit agreement or similar facility relating to the
Certificates of such series between a Liquidity Provider and a Subordination
Agent, as amended, replaced, supplemented or otherwise modified from time to
time in accordance with its terms and the terms of any Intercreditor Agreement.
LIQUIDITY PROVIDER: With respect to the Certificates of any Series,
means a bank or other financial institution that agrees to provide Liquidity
Facilities for the benefit of the holders of Certificates of such series.
5
LOAN TRUSTEE: With respect to any Equipment Note or the Indenture
applicable thereto, means the bank or trust company designated as loan or
indenture trustee under such Indenture; and any successor to such Loan Trustee
as such trustee; and LOAN TRUSTEES means all of the Loan Trustees under the
Indentures.
NOTE DOCUMENTS: With respect to any Equipment Note, means the related
Indenture, Note Purchase Agreement, and if the related Aircraft is leased to the
Company, the related Lease and the related Owner Trustee's Purchase Agreement.
NOTE PURCHASE AGREEMENT: With respect to the Certificates of any
series, means any note purchase, refunding, participation or similar agreement
providing for, among other things, the purchase of Equipment Notes by the
Trustee on behalf of the relevant Trust; and NOTE PURCHASE AGREEMENTS means
all such agreements.
OFFICER'S CERTIFICATE: Means a certificate signed, (a) in the case of
the Guarantor or the Company, by (i) a Co-Chairman of the Board of Directors,
the President or any Executive Vice President or Senior Vice President of the
Guarantor or the Company, signing alone or (ii) any Vice President of the
Guarantor or the Company signing together with the Secretary, the Assistant
Secretary, the Treasurer or any Assistant Treasurer of the Guarantor or the
Company, or (b) in the case of the Trustee or an Owner Trustee or a Loan
Trustee, a Responsible Officer of the Trustee or such Owner Trustee or such Loan
Trustee, as the case may be.
OTHER AGREEMENTS: Has the meaning specified in Section 6.01(b).
OPINION OF COUNSEL: Means a written opinion of legal counsel who (a) in
the case of counsel for the Guarantor or the Company, may be (i) a senior
attorney in rank of the officers of the Guarantor or the Company a principal
duty of which is furnishing advice as to legal matters, (ii) Xxxxxxx Xxxxxxx &
Xxxxxxxx or (iii) such other counsel designated by the Guarantor or the Company
and reasonably acceptable to the Trustee and (b) in the case of any Owner
Trustee or any Loan Trustee, may be such counsel as may be designated by any of
them whether or not such counsel is an employee of any of them, and who shall be
reasonably acceptable to the Trustee.
OUTSTANDING: With respect to Certificates of any series, means, as of
the date of determination, all Certificates of such series theretofore
authenticated and delivered under this Agreement, except:
(i) Certificates of such series theretofore cancelled by the
Registrar or delivered to the Trustee or the Registrar for cancellation;
(ii) All of the Certificates of such series if money in the full
amount required to make the final distribution with respect to such series
pursuant to Section 11.01 hereof has been theretofore deposited with the
Trustee in trust for the Holders of the Certificates of such series as
provided in Section 4.01 pending distribution of such money to such
Certificateholders pursuant to such final distribution payment; and
(iii) Certificates of such series in exchange for or in lieu of
which other Certificates of such series have been authenticated and
delivered pursuant to this Agreement.
OWNER PARTICIPANT: With respect to any Equipment Note, means the "Owner
Participant", if any, as referred to in the Indenture pursuant to which such
Equipment Note is issued and any
6
permitted successor or assign of such Owner Participant; and OWNER PARTICIPANTS
at any time of determination means all of the Owner Participants thus referred
to in the Indentures.
OWNER TRUSTEE: with respect to any Equipment Note, means the "Owner
Trustee", if any, as referred to in the Indenture pursuant to which such
Equipment Note is issued, not in its individual capacity but solely as trustee;
and OWNER TRUSTEES means all of the Owner Trustees party to any of the
respective Indentures.
OWNER TRUSTEE'S PURCHASE AGREEMENT: With respect to the Certificates of
any series, if the related Aircraft is leased to the Company, has the meaning
specified therefor in the related Lease.
PAYING AGENT: With respect to the Certificates of any series, means the
paying agent maintained and appointed for the Certificates of such series
pursuant to Section 7.11.
PERMITTED INVESTMENTS: Means obligations of the United States of
America or agencies or instrumentalities thereof for the payment of which the
full faith and credit of the United States of America is pledged, maturing in
not more than 60 days or such lesser time as is necessary for payment of any
Special Payments on a Special Distribution Date.
PERSON: Means any person, including any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof.
POOL BALANCE: Means, as of any date, (i) the original aggregate face
amount of the Certificates of any series less (ii) the aggregate amount of all
payments made in respect of such Certificates other than payments made in
respect of interest or premium thereon or reimbursement of any costs or expenses
incurred in connection therewith. The Pool Balance as of any Distribution Date
shall be computed after giving effect to the payment of principal, if any, on
the Equipment Notes or other Trust Property held in the Trust and the
distribution thereof to be made on such Distribution Date.
POOL FACTOR: Means, with respect to any series of Certificates as of
any date, the quotient (rounded to the seventh decimal place) computed by
dividing (i) the Pool Balance of such series as at such date by (ii) the
original aggregate face amount of the Certificates of such series. The Pool
Factor as of any Distribution Date shall be computed after giving effect to the
payment of principal, if any, on the Equipment Notes or other Trust Property and
the distribution thereof to be made on such Distribution Date.
POSTPONED NOTES: With respect to any Trust or the related series of
Certificates, means the Equipment Notes to be held in such Trust as to which a
Postponement Notice shall have been delivered pursuant to Section 2.02(b).
POSTPONEMENT NOTICE: With respect to any Trust or the related series of
Certificates, means an Officer's Certificate of the Company signed by an officer
of the Company (1) requesting that the Trustee temporarily postpone purchase of
the related Equipment Notes to a date later than the Issuance Date of such
series of Certificates, (2) identifying the amount of the purchase price of each
such Equipment Note and the aggregate purchase price for all such Equipment
Notes, (3) setting forth the reasons for such postponement and (4) with respect
to each such Equipment Note, either (a) setting or resetting a new Transfer Date
(which shall be on or prior to the applicable Cut-off Date) for payment by the
Trustee of such purchase price and issuance of the related Equipment Note, or
(b) indicating
7
that such new Transfer Date (which shall be on or prior to the applicable
Cut-off Date) will be set by subsequent written notice not less than one
Business Day prior to such new Transfer Date.
PTC EVENT OF DEFAULT: Means any failure to pay within 10 Business Days
of the due date thereof: (i) the outstanding Pool Balance on a date specified
in any Trust Supplement or (ii) interest due on the Certificates of any series
on any Distribution Date.
RECORD DATE: With respect to any Trust or the related series of
Certificates, means (i) for Scheduled Payments to be distributed on any Regular
Distribution Date, other than the final distribution, with respect to such
series, the 15th day (whether or not a Business Day) preceding such Regular
Distribution Date, and (ii) for Special Payments to be distributed on any
Special Distribution Date, other than the final distribution, with respect to
such series, the 15th day (whether or not a Business Day) preceding such Special
Distribution Date.
REGISTER AND REGISTRAR: With respect to the Certificates of any series,
mean the register maintained and the registrar appointed for such series
pursuant to Sections 3.04 and 7.11.
REGULAR DISTRIBUTION DATE: With respect to distributions of Scheduled
Payments in respect of any series of Certificates, means each date designated as
such in this Agreement, until payment of all the Scheduled Payments to be made
under the Equipment Notes held in such Trust has been made.
REQUEST: Means a request by the Company setting forth the subject
matter of the request accompanied by an Officer's Certificate and an Opinion of
Counsel as provided in Section 1.02 of this Basic Agreement.
RESPONSIBLE OFFICER: With respect to any Trustee, any Loan Trustee and
any Owner Trustee, means any officer in the Corporate Trust Division of the
Trustee, Loan Trustee or Owner Trustee or any other officer customarily
performing functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with a particular subject.
SCHEDULED PAYMENT: With respect to any Equipment Note, means any
payment of principal and interest on such Equipment Note or any payment of
interest on the Certificates of any series with funds drawn under the Liquidity
Facility for such series (other than any such payment which is not in fact
received by the Trustee or any Subordination Agent within five days of the date
on which such payment is scheduled to be made) due from the obligor thereon
which payment represents the installment of principal at the stated maturity of
such installment of principal on such Equipment Note, the payment of regularly
scheduled interest accrued on the unpaid principal amount of such Equipment
Note, or both; provided that any payment of principal, premium, if any, or
interest resulting from the redemption or purchase of any Equipment Note shall
not constitute a Scheduled Payment.
SEC: Means the Securities and Exchange Commission, as from time to time
constituted or created under the Securities Exchange Act of 1934, or, if at any
time after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties on such date.
SPECIAL DISTRIBUTION DATE: With respect to the Certificates of any
series, means each date on which a Special Payment is to be distributed as
specified in this Agreement.
8
SPECIAL PAYMENT: Means (i) any payment (other than a Scheduled Payment)
in respect of, or any proceeds of, any Equipment Note or Trust Indenture Estate
(as defined in each Indenture) or (ii) the amounts required to be distributed
pursuant to the last paragraph of Section 2.02(b) or (iii) the amounts required
to be distributed pursuant to the penultimate paragraph of Section 2.02(b).
SPECIAL PAYMENTS ACCOUNT: With respect to the Certificates of any
series, means the account or accounts created and maintained for such series
pursuant to Section 4.01(b) and the related Trust Supplement.
SPECIFIED INVESTMENTS: With respect to any Trust, means, unless
otherwise specified in the related Trust Supplement, (i) obligations of, or
guaranteed by, the United States Government or agencies thereof, (ii) open
market commercial paper of any corporation incorporated under the laws of the
United States of America or any State thereof rated at least P-2 or its
equivalent by Xxxxx'x Investors Service, Inc. or at least A-2 or its equivalent
by Standard & Poor's Rating Group, (iii) certificates of deposit issued by
commercial banks organized under the laws of the United States or of any
political subdivision thereof having a combined capital and surplus in excess of
$500,000,000 which banks or their holding companies have a rating of A or its
equivalent by Xxxxx'x Investors Service, Inc. or Standard & Poor's Rating Group;
PROVIDED, HOWEVER, that the aggregate amount at any one time so invested in
certificates of deposit issued by any one bank shall not exceed 5% of such
bank's capital and surplus, (iv) U.S. dollar denominated offshore certificates
of deposit issued by, or offshore time deposits with, any commercial bank
described in (iii) or any subsidiary thereof and (v) repurchase agreements with
any financial institution having combined capital and surplus of at least
$500,000,000 with any of the obligations described in clauses (i) through (iv)
as collateral; PROVIDED FURTHER that if all of the above investments are
unavailable, the entire amounts to be invested may be used to purchase Federal
Funds from an entity described in clause (iii) above; and PROVIDED FURTHER
that no investment shall be eligible as a "Specified Investment" unless the
final maturity or date of return of such investment is on or before the Special
Distribution Date next following the Cut-off Date, if any, for such Trust by
more than 20 days.
SUBORDINATION AGENT: Shall have the meaning specified therefor in any
Intercreditor Agreement.
SUBSTITUTE AIRCRAFT: With respect to any Trust, means any Aircraft of a
type specified in this Agreement and, at the election of the Company,
substituted prior to the applicable Cut-off Date, if any, pursuant to the terms
of this Agreement.
TRANSFER DATE: Has the meaning assigned to that term or any of the
terms "Delivery Date", "Funding Date" or "Closing Date" in a Note Purchase
Agreement.
TRIGGERING EVENT: Shall have the meaning specified therefor in any
Intercreditor Agreement.
TRUST: With respect to the Certificates of any series, means the trust
under this Agreement.
TRUSTEE: Means the institution executing this Basic Agreement as
Trustee, or its successor in interest, and any successor trustee appointed as
provided herein.
TRUST INDENTURE ACT: Except as otherwise provided in Section 9.06,
means the Trust Indenture Act of 1939 as in force at the date as of which this
Basic Agreement was executed.
9
TRUST PROPERTY: With respect to any Trust, means (i) the Equipment
Notes held as the property of such Trust, all monies at any time paid thereon
and all monies due and to become due thereunder, (ii) the rights of such Trust
under any Intercreditor Agreement, including all monies receivable in respect of
such rights, (iii) all monies receivable under any Liquidity Facility for such
Trust and (iv) funds from time to time deposited in the related Escrow Account,
the related Certificate Account and the related Special Payments Account and any
proceeds from the sale by the Trustee pursuant to Article VI hereof of any such
Equipment Note.
TRUST SUPPLEMENT: Means an agreement supplemental hereto pursuant to
which (i) a separate Trust is created for the benefit of the Holders of the
Certificates of a series, (ii) the issuance of the Certificates of such series
representing fractional undivided interests in such Trust is authorized and
(iii) the terms of the Certificates of such series are established.
Section 1.02. COMPLIANCE CERTIFICATES AND OPINIONS. Upon any
application or request by the Company, any Owner Trustee or any Loan Trustee to
the Trustee to take any action under any provision of this Basic Agreement or,
in respect of the Certificates of any series, this Agreement, the Company, such
Owner Trustee or such Loan Trustee, as the case may be, shall furnish to the
Trustee an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Basic Agreement or this
Agreement relating to the proposed action have been complied with and an Opinion
of Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Basic Agreement or this Agreement
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Basic Agreement or, in respect of the
Certificates of any series, this Agreement (other than a certificate provided
pursuant to Section 8.04(d)) or any Trust Supplement shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions in this
Basic Agreement or this Agreement relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he
has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.03. FORM OF DOCUMENTS DELIVERED TO TRUSTEE. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters and any such Person may certify or give an opinion as to such
matters in one or several documents.
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Any Opinion of Counsel stated to be based on the opinion of other counsel
shall be accompanied by a copy of such other opinion.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Basic Agreement or, in respect of the Certificates of any
series, this Agreement, they may, but need not, be consolidated and form one
instrument.
Section 1.04. ACTS OF CERTIFICATEHOLDERS. (a) Any direction, consent,
waiver or other action provided by this Agreement in respect of the Certificates
of any series to be given or taken by Certificateholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Certificateholders in person or by an agent or proxy duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required pursuant to this Agreement,
to the Company or any Loan Trustee. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Certificateholders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of such Trust Supplement and
conclusive in favor of the Trustee, the Company and the related Loan Trustee, if
made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the certificate of any notary public or
other officer of any jurisdiction authorized to take acknowledgments of deeds or
administer oaths that the Person executing such instrument acknowledged to him
the execution thereof, or by an affidavit of a witness to such execution sworn
to before any such notary or such other officer and where such execution is by
an officer of a corporation or association or a member of a partnership, on
behalf of such corporation, association or partnership, such certificate or
affidavit shall also constitute sufficient proof of his authority. The fact and
date of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other reasonable manner
which the Trustee deems sufficient.
(c) In determining whether the Certificateholders of the requisite
Fractional Undivided Interests of Certificates of any series Outstanding have
given any direction, consent or waiver (a "Direction"), under this Agreement,
Certificates owned by the Company, the Guarantor, any related Owner Trustee, any
related Owner Participant or any Affiliate of any such Person shall be
disregarded and deemed not to be Outstanding for purposes of any such
determination. In determining whether the Trustee shall be protected in relying
upon any such Direction, only Certificates which the Trustee knows to be so
owned shall be so disregarded. Notwithstanding the foregoing, (i) if any such
Person owns 100% of the Certificates of any series Outstanding, such
Certificates shall not be so disregarded as aforesaid, and (ii) if any amount of
Certificates of such series so owned by any such Person have been pledged in
good faith, such Certificates shall not be disregarded as aforesaid if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Certificates and that the pledgee is not the Company,
the Guarantor, any related Owner Trustee, any related Owner Participant or any
Affiliate of any such Person.
(d) The Company may at its option by delivery of an Officer's
Certificate to the Trustee set a record date to determine the Certificateholders
in respect of the Certificates of any series, entitled to give any consent,
request, demand, authorization, direction, notice, waiver or other Act.
Notwithstanding Section 316(c) of the Trust Indenture Act, such record date
shall be the record date specified in such Officer's Certificate which shall be
a date not more than 30 days prior to the first
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solicitation of Certificateholders in connection therewith. If such a record
date is fixed, such consent, request, demand, authorization, direction, notice,
waiver or other Act may be given before or after such record date, but only the
Certificateholders of record of the applicable series at the close of business
on such record date shall be deemed to be Certificateholders for the purposes of
determining whether Certificateholders of the requisite proportion of
Outstanding Certificates of such series have authorized or agreed or consented
to such consent, request, demand, authorization, direction, notice, waiver or
other Act, and for that purpose the Outstanding Certificates of such series
shall be computed as of such record date; PROVIDED that no such consent,
request, demand, authorization, direction, notice, waiver or other Act by the
Certificateholders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Basic Agreement not later
than one year after the record date.
(e) Any direction, consent, waiver or other action by the
Certificateholder of any Certificate shall bind the Certificateholder of every
Certificate issued upon the transfer thereof or in exchange therefor or in lieu
thereof, whether or not notation of such action is made upon such Certificate.
(f) Except as otherwise provided in Section 1.04(c), Certificates of any
series owned by or pledged to any Person shall have an equal and proportionate
benefit under the provisions of this Agreement, without preference, priority, or
distinction as among all of the Certificates of such series.
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
Section 2.01. AMOUNT UNLIMITED; ISSUABLE IN SERIES.
(a) The aggregate principal amount of Certificates of each series which
may be authenticated and delivered under this Basic Agreement is limited to an
amount equal to the aggregate principal amount of the Equipment Notes held in
the related Trust. The Certificates may be issued from time to time in one or
more series and shall be designated generally as the "Pass Through
Certificates", with such further designations added or incorporated in such
title for the Certificates of each series as specified in the related Trust
Supplement. Each Certificate shall bear upon its face the designation so
selected for the series to which it belongs. All Certificates of the same
series shall be substantially identical except that the Certificates of a series
may differ as to denomination and as may otherwise be provided in the Trust
Supplement establishing the Certificates of such series. Each series of
Certificates issued pursuant to this Agreement will evidence fractional
undivided interests in the related Trust and, except as may be contained in any
Intercreditor Agreement, will have no rights, benefits or interests in respect
of any other Trust or the Trust Property held therein. All Certificates of the
same series shall be in all respects equally and ratably entitled to the
benefits of this Agreement without preference, priority or distinction on
account of the actual time or times of authentication and delivery, all in
accordance with the terms and provisions of this Agreement.
(b) The following matters shall be established with respect to the
Certificates of each series issued hereunder by a Trust Supplement executed and
delivered by and among the Company, the Guarantor and the Trustee:
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(1) the formation of the Trust as to which the Certificates of
such series represent fractional undivided interests and its designation
(which designation shall distinguish such Trust from each other Trust
created under this Basic Agreement and a Trust Supplement);
(2) the specific title of the Certificates of such series (which
title shall distinguish the Certificates of such series from each other
series of Certificates created under this Basic Agreement and a Trust
Supplement);
(3) any limit upon the aggregate principal amount of the
Certificates of such series which may be authenticated and delivered
(which limit shall not pertain to Certificates authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, other
Certificates of the series pursuant to Sections 3.03, 3.04 and 3.05);
(4) the Cut-off Date with respect to the Certificates of such
series;
(5) the Regular Distribution Dates applicable to the Certificates
of such series;
(6) the Special Distribution Dates applicable to the Certificates
of such series;
(7) if other than as provided in Section 7.11(b), the Registrar or
the Paying Agent for the Certificates of such series, including any
Co-Registrar or additional Paying Agent;
(8) if other than as provided in Section 3.01, the denominations
in which the Certificates of such series shall be issuable;
(9) if other than United States dollars, the currency or
currencies (including currency units) in which the Certificates of such
series shall be denominated;
(10) the specific form of the Certificates of such series
(including the interest rate applicable thereto) and whether or not
Certificates of such series are to be issued as Book-Entry Certificates
and, if such Certificates are to be Book-Entry Certificates, the form of
Letter of Representations, if any (or, in the case of any Certificates
denominated in a currency other than United States dollars and if other
than as provided in Section 3.09, whether and the circumstances under
which beneficial owners of interests in such Certificates in permanent
global form may exchange such interests for Certificates of such series
and of like tenor of any authorized form and denomination);
(11) a description of the Equipment Notes to be acquired and held
in the related Trust and of the related Aircraft and Note Documents;
(12) provisions with respect to the terms for which the definitions
set forth in Article I hereof or the terms of Section 11.01 hereof permit
or require further specification in the related Trust Supplement;
(13) any restrictions (including legends) in respect of ERISA;
(14) whether such series will be subject to an Intercreditor
Agreement and, if so, the specific designation of such Intercreditor
Agreement; and
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(15) any other terms of the Certificates of such series (which
terms shall not be inconsistent with the provisions of the Trust Indenture
Act), including any terms which may be required or advisable under United
States laws or regulations or advisable in connection with the marketing
of Certificates of the series.
(c) At any time and from time to time after the execution and delivery
of this Basic Agreement and a Trust Supplement forming a Trust and establishing
the terms of Certificates of a series, Certificates of such series shall be
executed, authenticated and delivered by the Trustee to the Person or Persons
specified by the Company upon request of the Company and upon satisfaction of
any conditions precedent set forth in such Trust Supplement or in any other
document to which a Trustee is a party relating to the issuance of the
Certificates of such series.
Section 2.02. ACQUISITION OF EQUIPMENT NOTES.
(a) Unless otherwise specified in the related Trust Supplement, on or
prior to the Issuance Date of the Certificates of a series, the Trustee shall
execute and deliver the related Note Purchase Agreements in the form delivered
to the Trustee by the Company. The Trustee shall issue and sell such
Certificates, in authorized denominations and in such Fractional Undivided
Interests, so as to result in the receipt of consideration in an amount equal to
the aggregate purchase price of such Equipment Notes and, concurrently
therewith, the Trustee shall purchase, pursuant to the terms and conditions of
the Note Purchase Agreements, the Equipment Notes at a purchase price equal to
the amount of such consideration so received. Except as provided in Sections
3.03, 3.04 and 3.05 hereof, the Trustee shall not execute, authenticate or
deliver Certificates of such series in excess of the aggregate amount specified
in this paragraph. The provisions of this Subsection (a) are subject to the
provisions of Subsection (b) below.
(b) If on or prior to the Issuance Date with respect to a series of
Certificates the Company shall deliver to the Trustee a Postponement Notice
relating to one or more Postponed Notes, the Trustee shall postpone the purchase
of such Postponed Notes and shall deposit into an escrow account (as to such
Trust, the "Escrow Account") to be maintained as a part of the related Trust an
amount equal to the purchase price of such Postponed Notes (the "Escrowed
Funds"). The Escrowed Funds so deposited shall be invested by the Trustee at
the written direction and risk of, and for the benefit of, the Company in
Specified Investments (i) maturing no later than any scheduled Transfer Date
relating to such series of Certificates or (ii) if no such Transfer Date has
been scheduled, maturing on the next Business Day, or (iii) if the Company has
given notice to the Trustee that any Postponed Notes will not be issued, with
respect to the portion of the Escrowed Funds relating to such Postponed Notes,
maturing on the next applicable Special Distribution Date, if such investments
are reasonably available for purchase. The Trustee shall make withdrawals from
the Escrow Account only as provided in this Agreement. Upon request of the
Company on one or more occasions and the satisfaction of the closing conditions
specified in the applicable Note Purchase Agreements on or prior to the related
Cut-off Date, the Trustee shall purchase the applicable Postponed Notes with the
Escrowed Funds withdrawn from the Escrow Account. The purchase price shall
equal the principal amount of such Postponed Notes.
The Trustee shall hold all Specified Investments until the maturity
thereof and will not sell or otherwise transfer Specified Investments. If
Specified Investments held in an Escrow Account mature prior to any applicable
Transfer Date, any proceeds received on the maturity of such Specified
Investments (other than any earnings thereon) shall be reinvested by the Trustee
at the written direction and risk of, and for the benefit of, the Company in
Specified Investments maturing as provided in the preceding paragraph.
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Any earnings on Specified Investments received from time to time by the
Trustee shall be promptly distributed to the Company. The Company shall pay to
the Trustee for deposit to the relevant Escrow Account an amount equal to any
losses on such Specified Investments as incurred. On the Initial Regular
Distribution Date in respect of the Certificates of any series, the Company will
pay (in immediately available funds) to the Trustee an amount equal to the
interest that would have accrued on any Postponed Notes, if any, purchased after
the Issuance Date if such Postponed Notes had been purchased on the Issuance
Date, from the Issuance Date to, but not including, the date of the purchase of
such Postponed Notes by the Trustee.
If, in respect of the Certificates of any series, the Company notifies the
Trustee prior to the Cut-off Date that any Postponed Notes will not be issued on
or prior to the Cut-off Date for any reason, on the next Special Distribution
Date for such Certificates occurring more than 20 days following the date of
such notice (i) the Company shall pay to the Trustee for deposit in the related
Special Payments Account, in immediately available funds, an amount equal to the
interest that would have accrued on the Postponed Notes designated in such
notice at a rate equal to the interest rate applicable to such Certificates from
the Issuance Date to, but not including, such Special Distribution Date and (ii)
the Trustee shall transfer an amount equal to that amount of Escrowed Funds that
would have been used to purchase the Postponed Notes designated in such notice
and the amount paid by the Company pursuant to the immediately preceding clause
(i) to the related Special Payments Account for distribution as a Special
Payment in accordance with the provisions hereof.
If, on such Cut-off Date, an amount equal to less than all of the Escrowed
Funds (other than Escrowed Funds referred to in the immediately preceding
paragraph) has been used to purchase Postponed Notes, on the next such Special
Distribution Date occurring more than 20 days following such Cut-off Date (i)
the Company shall pay to the Trustee for deposit in such Special Payments
Account, in immediately available funds, an amount equal to the interest that
would have accrued on such Postponed Notes contemplated to be purchased with
such unused Escrowed Funds (other than Escrowed Funds referred to in the
immediately preceding paragraph) but not so purchased at a rate equal to the
interest rate applicable to such Certificates from the Issuance Date to, but not
including, such Special Distribution Date and (ii) the Trustee shall transfer
such unused Escrowed Funds and the amount paid by the Company pursuant to the
immediately preceding clause (i) to such Special Payments Account for
distribution as a Special Payment in accordance with the provisions hereof.
Section 2.03. ACCEPTANCE BY TRUSTEE. The Trustee, upon the execution
and delivery of a Trust Supplement creating a Trust and establishing a series of
Certificates, shall acknowledge its acceptance of all right, title, and interest
in and to the Equipment Notes to be acquired pursuant to Section 2.02 hereof and
the related Note Purchase Agreements and shall declare that the Trustee holds
and will hold such right, title, and interest, together with all other property
constituting the Trust Property of such Trust, for the benefit of all then
present and future Certificateholders of such series, upon the trusts herein and
in such Trust Supplement set forth. By its payment for and acceptance of each
Certificate of such series issued to it under this Agreement, each initial
Certificateholder of such series as grantor of such Trust shall thereby join in
the creation and declaration of such Trust.
Section 2.04. LIMITATION OF POWERS. Each Trust shall be constituted
solely for the purpose of making the investment in the Equipment Notes provided
for in the related Trust Supplement, and, except as set forth herein or in this
Agreement, the Trustee shall not be authorized or empowered to acquire any other
investments or engage in any other activities and, in particular, the Trustee
shall not be authorized or empowered to do anything that would cause such Trust
to fail to qualify as a "grantor trust" for federal income tax purposes
(including as subject to this restriction, acquiring the Aircraft (as
15
defined in the respective related Indentures) by bidding such Equipment Notes or
otherwise, or taking any action with respect to any such Aircraft once
acquired).
ARTICLE III
THE CERTIFICATES
Section 3.01. FORM, DENOMINATION AND EXECUTION OF CERTIFICATES. The
Certificates of each series shall be issued in fully registered form without
coupons and shall be substantially in the form attached hereto as Exhibit A,
with such omissions, variations and insertions as are permitted by this
Agreement, and may have such letters, numbers or other marks of identification
and such legends or endorsements printed, lithographed or engraved thereon, as
may be required to comply with the rules of any securities exchange on which
such Certificates may be listed or to conform to any usage in respect thereof,
or as may, consistently herewith, be prescribed by the Trustee or by the officer
executing such Certificates, such determination by said officer to be evidenced
by his signing the Certificates.
Except as provided in Section 3.09, the definitive Certificates of such
series shall be printed, lithographed or engraved or produced by any combination
of these methods or may be produced in any other manner permitted by the rules
of any securities exchange on which the Certificates may be listed, all as
determined by the officer executing such Certificates, as evidenced by his
execution of such Certificates.
Except as otherwise provided in the related Trust Supplement, the
Certificates of each series shall be issued in minimum denominations of $1,000
or integral multiples thereof except that one Certificate of such series may be
issued in a denomination of less than $1,000.
The Certificates of such series shall be executed on behalf of the Trustee
by manual or facsimile signature of a Responsible Officer of the Trustee.
Certificates of any series bearing the manual or facsimile signature of an
individual who was, at the time when such signature was affixed, authorized to
sign on behalf of the Trustee shall be valid and binding obligations of the
Trustee, notwithstanding that such individual has ceased to be so authorized
prior to the authentication and delivery of such Certificates or did not hold
such office at the date of such Certificates. No Certificate of any series
shall be entitled to any benefit under this Agreement, or be valid for any
purpose unless there appears on such Certificate a certificate of authentication
substantially in the form set forth in Exhibit A hereto executed by the Trustee
by manual signature, and such certificate of authentication upon any Certificate
shall be conclusive evidence, and the only evidence, that such Certificate has
been duly authenticated and delivered hereunder. All Certificates of any series
shall be dated on the date of their authentication.
Section 3.02. AUTHENTICATION OF CERTIFICATES. The Trustee shall duly
authenticate and deliver Certificates of each series in authorized denominations
equalling in the aggregate the aggregate principal amount of the Equipment Notes
to be purchased by the Trustee pursuant to the related Note Purchase Agreements,
and evidencing the entire ownership of the related Trust.
Section 3.03. TEMPORARY CERTIFICATES. Pending the preparation of
definitive Certificates of any series, the Trustee may execute, authenticate and
deliver temporary Certificates of such series which are printed, lithographed,
typewritten, or otherwise produced, in any denomination, containing
substantially the same terms and provisions as set forth in Exhibit A hereto,
except for such appropriate insertions, omissions, substitutions and other
variations relating to their temporary nature
16
as the officer executing such temporary Certificates may determine, as evidenced
by its execution of such temporary Certificates.
If temporary Certificates of any series are issued, the Company will cause
definitive Certificates of such series to be prepared without unreasonable
delay. After the preparation of definitive Certificates of such series, the
temporary Certificates shall be exchangeable for definitive Certificates upon
surrender of such temporary Certificates at the Corporate Trust Office of the
Trustee, or at the office or agency of the Trustee maintained in accordance with
Section 7.11, without charge to the holder. Upon surrender for cancellation of
any one or more temporary Certificates, the Trustee shall execute, authenticate
and deliver in exchange therefor definitive Certificates of like series, in
authorized denominations and of a like aggregate Fractional Undivided Interest.
Until so exchanged, such temporary Certificates shall in all respects be
entitled to the same benefits under this Agreement as definitive Certificates.
Section 3.04. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
The Trustee shall cause to be kept at the office or agency to be maintained by
it in accordance with the provisions of Section 7.11 a register (the "Register")
for each series of Certificates in which, subject to such reasonable regulations
as it may prescribe, the Trustee shall provide for the registration of
Certificates of such series and of transfers and exchanges of such Certificates
as herein provided. The Trustee shall initially be the registrar (the
"Registrar") for the purpose of registering Certificates of each series and
transfers and exchanges of such Certificates as herein provided.
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office or such other office or agency, the Trustee shall
execute, authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of like series, in authorized
denominations of a like aggregate Fractional Undivided Interest.
At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of like series, in authorized denominations and of a like
aggregate Fractional Undivided Interest, upon surrender of the Certificates to
be exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute, authenticate and deliver
the Certificates that the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the Registrar
duly executed by the Certificateholder thereof or its attorney duly authorized
in writing.
No service charge shall be made to a Certificateholder for any
registration of transfer or exchange of Certificates, but the Trustee shall
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer and exchange
shall be cancelled and subsequently destroyed by the Trustee.
Section 3.05. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If
(a) any mutilated Certificate is surrendered to the Registrar, or the Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (b) there is delivered to the Registrar and the Trustee such
security, indemnity or bond, as may be required by them to save each of them
harmless, then, in the absence of notice to the Registrar or the Trustee that
such Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate or
Certificates of like series, in authorized denominations and of like Fractional
Undivided Interest. In connection with the issuance of
17
any new Certificate under this Section 3.05, the Trustee shall require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Trustee and the Registrar) connected therewith. Any
duplicate Certificate issued pursuant to this Section 3.05 shall constitute
conclusive evidence of the appropriate Fractional Undivided Interest in the
related Trust, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
Section 3.06. PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Trustee, the Registrar, and any
Paying Agent of the Trustee may treat the person in whose name any Certificate
is registered as the owner of such Certificate for the purpose of receiving
distributions pursuant to Section 4.02 and for all other purposes whatsoever,
and neither the Trustee, the Registrar, nor any Paying Agent of the Trustee
shall be affected by any notice to the contrary.
Section 3.07. CANCELLATION. All Certificates surrendered for payment
or transfer or exchange shall, if surrendered to any Person party hereto other
than the Registrar, be delivered to the Registrar for cancellation. No
Certificates shall be authenticated in lieu of or in exchange for any
Certificates cancelled as provided in this Section, except as expressly
permitted by this Agreement. All cancelled Certificates held by the Registrar
shall be destroyed and a certification of their destruction delivered to the
Trustee.
Section 3.08. LIMITATION OF LIABILITY FOR PAYMENTS. All payments or
distributions made to Certificateholders of any series under the related Trust
Supplement shall be made only from the Trust Property of the related Trust and
only to the extent that the Trustee shall have sufficient income or proceeds
from such Trust Property to make such payments in accordance with the terms of
Article IV of this Agreement. Each Certificateholder, by its acceptance of a
Certificate, agrees that it will look solely to the income and proceeds from the
Trust Property of the related Trust to the extent available for distribution to
such Certificateholder as provided in this Agreement.
Section 3.09. BOOK-ENTRY AND DEFINITIVE CERTIFICATES.
(a) Except for one Certificate of each series that may be issued in a
denomination of less than $1,000, the Certificates of any series may be issued
in the form of one or more typewritten Certificates representing the Book-Entry
Certificates of such series, to be delivered to The Depository Trust Company,
the initial Clearing Agency, by, or on behalf of, the Company. In such case,
the Certificates of such series delivered to The Depository Trust Company shall
initially be registered on the Register in the name of CEDE & Co., the nominee
of the initial Clearing Agency, and no Certificate Owner will receive a
definitive certificate representing such Certificate Owner's interest in the
Certificates of such series, except as provided above and in Subsection (d)
below. As to the Certificates of any series, except with respect to the one
Certificate of such series that may be issued in a denomination of less than
$1,000, unless and until definitive, fully registered Certificates (the
"Definitive Certificates") have been issued pursuant to Subsection (d) below:
(i) the provisions of this Section 3.09 shall be in full force and
effect;
(ii) the Company, the Paying Agent, the Registrar and the Trustee
may deal with the Clearing Agency Participants for all purposes (including
the making of distributions on the Certificates) as the authorized
representatives of the Certificate Owners;
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(iii) to the extent that the provisions of this Section 3.09
conflict with any other provisions of this Agreement (other than the
provisions of any Trust Supplement amending this Section 3.09 as permitted
by this Basic Agreement), the provisions of this Section 3.09 shall
control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law and agreements between such Certificate Owners and the Clearing Agency
Participants; and until Definitive Certificates are issued pursuant to
Subsection (d) below, the Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit
distributions of principal and interest and premium, if any, on the
Certificates to such Clearing Agency Participants; and
(v) whenever this Agreement requires or permits actions to be
taken based upon instructions or directions of Certificateholders of such
series holding Certificates of such series evidencing a specified
percentage of the Fractional Undivided Interests in the related Trust, the
Clearing Agency shall be deemed to represent such percentage only to the
extent that it has received instructions to such effect from Certificate
Owners and/or Clearing Agency Participants owning or representing,
respectively, such required percentage of the beneficial interest in
Certificates of such series and has delivered such instructions to the
Trustee. The Trustee shall have no obligation to determine whether the
Clearing Agency has in fact received any such instructions.
(b) Except with respect to the one Certificate of each series that may
be issued in a denomination of less than $1,000, whenever notice or other
communication to the Certificateholders of such series is required under this
Agreement, unless and until Definitive Certificates shall have been issued
pursuant to Subsection (d) below, the Trustee shall give all such notices and
communications specified herein to be given to Certificateholders of such series
to the Clearing Agency.
(c) Unless and until Definitive Certificates of a series are issued
pursuant to Subsection (d) below, on the Record Date prior to each applicable
Regular Distribution Date and Special Distribution Date, the Trustee will
request from the Clearing Agency a Securities Position Listing setting forth the
names of all Clearing Agency Participants reflected on the Clearing Agency's
books as holding interests in the Certificates on such Record Date.
(d) If with respect to the Certificates of any series (i) the Company
advises the Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities and the Trustee or the Company
is unable to locate a qualified successor, (ii) the Company at its option,
advises the Trustee in writing that it elects to terminate the book-entry system
through the Clearing Agency or (iii) after the occurrence of an Event of
Default, Certificate Owners of Book-Entry Certificates of such series evidencing
Fractional Undivided Interests aggregating not less than a majority in interest
in the related Trust, by Act of said Certificate Owners delivered to the Company
and the Trustee, advise the Company, the Trustee and the Clearing Agency through
the Clearing Agency Participants in writing that the continuation of a
book-entry system through the Clearing Agency Participants is no longer in the
best interests of the Certificate Owners of such series, then the Trustee shall
notify all Certificate Owners of such series, through the Clearing Agency, of
the occurrence of any such event and of the availability of Definitive
Certificates. Upon surrender to the Trustee of all the Certificates of such
series held by the Clearing Agency, accompanied by registration instructions
from the Clearing Agency Participants for registration of Definitive
Certificates in the names of Certificate Owners of such series, the Trustee
shall issue and deliver the Definitive Certificates of such series in accordance
with the instructions of the Clearing Agency. Neither the
19
Company, the Registrar, the Paying Agent nor the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such registration instructions. Upon the issuance of
Definitive Certificates of such series, the Trustee shall recognize the Person
in whose name the Definitive Certificates are registered in the Register as
Certificateholders hereunder. Neither the Company nor the Trustee shall be
liable if the Trustee or the Company is unable to locate a qualified successor
Clearing Agency.
(e) Except as otherwise provided in the related Trust Supplement, the
Trustee shall enter into the applicable Letter of Representations with respect
to such series of Certificates and fulfill its responsibilities thereunder.
(f) The provisions of this Section 3.09 may be made inapplicable to any
series or may be amended with respect to any series in the related Trust
Supplement.
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
Section 4.01. CERTIFICATE ACCOUNT AND SPECIAL PAYMENTS ACCOUNT.
(a) The Trustee shall establish and maintain on behalf of the
Certificateholders of each series a Certificate Account as one or more
non-interest-bearing accounts. The Trustee shall hold the Certificate Account
in trust for the benefit of the Certificateholders of such series, and shall
make or permit withdrawals therefrom only as provided in this Agreement. On
each day when a Scheduled Payment is made to the Trustee, the Trustee, upon
receipt thereof, shall immediately deposit the aggregate amount of such
Scheduled Payment into the Certificate Account.
(b) The Trustee shall establish and maintain on behalf of the
Certificateholders of each series a Special Payments Account as one or more
accounts, which shall be non-interest bearing except as provided in Section
4.04. The Trustee shall hold the Special Payments Account in trust for the
benefit of the Certificateholders of such series, and shall make or permit
withdrawals therefrom only as provided in this Agreement. On each day when one
or more Special Payments are made to the Trustee, the Trustee, upon receipt
thereof, shall immediately deposit the aggregate amount of such Special Payments
into the Special Payments Account.
(c) The Trustee shall present to the Loan Trustee to which an Equipment
Note relates such Equipment Note on the date of its stated final maturity or, in
the case of any Equipment Note which is to be redeemed in whole pursuant to the
relevant Indenture, on the applicable redemption date under such Indenture.
Section 4.02. DISTRIBUTIONS FROM CERTIFICATE ACCOUNT AND SPECIAL
Payments Account.
(a) On each Regular Distribution Date with respect to a series of
Certificates or as soon thereafter as the Trustee has confirmed receipt of the
payment of the Scheduled Payments due on the Equipment Notes held in the related
Trust on such date, the Trustee shall distribute out of the applicable
Certificate Account the entire amount deposited therein pursuant to Section
4.01(a). There shall be so distributed to each Certificateholder of record of
such series on the Record Date with respect to such Regular Distribution Date
(other than as provided in Section 11.01 concerning the final distribution), by
check mailed to such Certificateholder at the address appearing in the Register,
such
20
Certificateholder's pro rata share (based on the aggregate Fractional Undivided
Interest in the related Trust held by such Certificateholder) of the aggregate
amount in the applicable Certificate Account.
(b) On each Special Distribution Date with respect to any Special
Payment with respect to a series of Certificates or as soon thereafter as the
Trustee has confirmed receipt of the Special Payments due on the Equipment Notes
held in the related Trust or realized upon the sale of such Equipment Note, the
Trustee shall distribute out of the applicable Special Payments Account the
entire amount deposited therein pursuant to Section 4.01(b) of such Special
Payment. There shall be so distributed to each Certificateholder of record of
such series on the Record Date with respect to such Special Distribution Date
(other than as provided in Section 11.01 concerning the final distribution), by
check mailed to such Certificateholder at the address appearing in the Register,
such Certificateholder's pro rata share (based on the aggregate Fractional
Undivided Interest in the related Trust held by such Certificateholder) of the
aggregate amount in the applicable Special Payments Account on account of such
Special Payment.
(c) The Trustee shall, at the expense of the Company, cause notice of
each Special Payment with respect to a series of Certificates to be mailed to
each Certificateholder of such series at his address as it appears in the
Register. In the event of redemption or purchase of Equipment Notes held in the
related Trust, such notice shall be mailed not less than 20 days prior to the
date any such Special Payment is scheduled to be distributed. In the case of
any other Special Payments, such notice shall be mailed as soon as practicable
after the Trustee has confirmed that it has received funds for such Special
Payment. Notices mailed by the Trustee shall set forth:
(i) the Special Distribution Date and the Record Date therefor
(except as otherwise provided in Section 11.01),
(ii) the amount of the Special Payment for each $1,000 face amount
Certificate (taking into account any payment to be made by the Company
pursuant to Section 2.02(b)) and the amount thereof constituting
principal, premium, if any, and interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a Regular
Distribution Date for the Certificates of such series, the total amount to
be received on such date for each $1,000 face amount Certificate.
If the amount of premium, if any, payable upon the redemption or purchase
of an Equipment Note has not been calculated at the time that the Trustee mails
notice of a Special Payment, it shall be sufficient if the notice sets forth the
other amounts to be distributed and states that any premium received will also
be distributed.
If any redemption of the Equipment Notes held in any Trust is cancelled,
the Trustee, as soon as possible after learning thereof, shall cause notice
thereof to be mailed to each Certificateholder of the related series at its
address as it appears on the Register.
Section 4.03. STATEMENTS TO CERTIFICATEHOLDERS.
(a) On each Regular Distribution Date and Special Distribution Date with
respect to a series of Certificates, the Trustee will include with each
distribution to Certificateholders of the related series a statement, giving
effect to such distribution to be made on such Regular Distribution Date or
21
Special Distribution Date, as the case may be, setting forth the following
information (per a $1,000 face amount Certificate as to (i) and (ii) below):
(i) The amount of such distribution allocable to principal and the
amount allocable to premium, if any;
(ii) The amount of such distribution allocable to interest; and
(iii) The Pool Balance and the Pool Factor of the related Trust.
With respect to the Certificates registered in the name of a
Clearing Agency or its nominee, on the record date prior to each Distribution
Date, the Trustee will request from the Clearing Agency a securities position
listing setting forth the names of all the Clearing Agency Participants
reflected on the Clearing Agency's books as holding interests in the
Certificates on such record date. On each Distribution Date, the applicable
Trustee will mail to each such Clearing Agency Participant the statement
described above and will make available additional copies as requested by such
Clearing Agency Participant for forwarding to holders of Certificates.
(b) Within a reasonable period of time after the end of each calendar
year but not later than the latest date permitted by law, the Trustee shall
furnish to each Person who at any time during such calendar year was a
Certificateholder of record a statement containing the sum of the amounts
determined pursuant to clauses (a)(i) and (a)(ii) with respect to the related
Trust for such calendar year or, in the event such Person was a
Certificateholder of record during a portion of such calendar year, for the
applicable portion of such year, and such other items as are readily available
to the Trustee and which a Certificateholder shall reasonably request as
necessary for the purpose of such Certificateholder's preparation of its Federal
income tax returns. With respect to Certificates registered in the name of a
Clearing Agency or its nominee, such report and such other items shall be
prepared on the basis of information supplied to the Trustees by the Clearing
Agency Participants and shall be delivered by the Trustee to such Clearing
Agency Participants to be available for forwarding by such Clearing Agency
Participants.
Section 4.04. INVESTMENT OF SPECIAL PAYMENT MONEYS. Any money received
by the Trustee pursuant to Section 4.01(b) representing a Special Payment which
is not to be promptly distributed shall, to the extent practicable, be invested
in Permitted Investments by the Trustee as directed in writing by the Company
pending distribution of such Special Payment pursuant to Section 4.02. Any
investment made pursuant to this Section 4.04 shall be in such Permitted
Investments having maturities not later than the date that such moneys are
required to be used to make the payment required under Section 4.02 on the
applicable Special Distribution Date and the Trustee shall hold any such
Permitted Investments until maturity. The Trustee shall have no liability with
respect to any investment made pursuant to this Section 4.04, other than by
reason of the willful misconduct or negligence of the Trustee. All income and
earnings from such investments shall be distributed on such Special Distribution
Date as part of such Special Payment.
ARTICLE V
THE COMPANY
Section 5.01. MAINTENANCE OF CORPORATE EXISTENCE. The Company, at its
own cost and expense, will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, rights and
franchises, except as otherwise specifically permitted in Section
22
5.02; provided, however, that the Company shall not be required to preserve any
right or franchise if the Company shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Company.
Section 5.02. CONSOLIDATION, MERGER, ETC. The Company shall not
consolidate with or merge into any other corporation or convey, transfer or
lease substantially all of its assets as an entirety to any Person unless:
(a) the corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, transfer or lease
substantially all of the assets of the Company as an entirety shall be a
"citizen of the United States" (as defined in Section 40102(a)(15) of Title 49
of the United States Code) holding a carrier operating certificate issued by the
Secretary of Transportation pursuant to Chapter 447 of Title 49, United States
Code, for aircraft capable of carrying 10 or more individuals or 6,000 pounds or
more of cargo and with respect to which there is in force an air carrier
operating certificate issued pursuant to Part 121 of the regulations under the
sections of Xxxxx 00, Xxxxxx Xxxxxx Code, relating to aviation;
(b) the corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, transfer or lease
substantially all of the assets of the Company as an entirety shall execute and
deliver to the Trustee applicable to the Certificates of each series a duly
authorized, valid, binding and enforceable agreement in form and substance
reasonably satisfactory to the Trustee containing an assumption by such
successor corporation or Person of the due and punctual performance and
observance of each covenant and condition of the Note Documents and of this
Agreement applicable to the Certificates of each series to be performed or
observed by the Company;
(c) immediately after giving effect to such transaction, no Event of
Default applicable to the Certificates of each series or event which is, or
after notice or passage of time, or both, would be, such an Event of Default
shall have occurred and be continuing; and
(d) the Company shall have delivered to the Trustee an Officers'
Certificate of the Company and an Opinion of Counsel of the Company (which may
be the Company's General Counsel) reasonably satisfactory to the Trustee, each
stating that such consolidation, merger, conveyance, transfer or lease and the
assumption agreement mentioned in clause (b) above comply with this Section 5.02
and that all conditions precedent herein provided for relating to such
transaction have been complied with.
Upon any consolidation or merger, or any conveyance, transfer or lease of
substantially all of the assets of the Company as an entirety in accordance with
this Section 5.02, the successor corporation or Person formed by such
consolidation or into which the Company is merged or to which such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Agreement applicable
to the Certificates of each series with the same effect as if such successor
corporation or Person had been named as the Company herein. No such conveyance,
transfer or lease of substantially all of the assets of the Company as an
entirety shall have the effect of releasing the Company or any successor
corporation or Person which shall theretofore have become such in the manner
prescribed in this Section 5.02 from its liability in respect of any Note
Document and of this Agreement applicable to the Certificates of such series to
which it is a party.
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ARTICLE VI
DEFAULT
Section 6.01. EVENTS OF DEFAULT. (a) EXERCISE OF REMEDIES: Upon the
occurrence and during the continuation of any Indenture Default under any
Indenture, the Trustee may, to the extent it is the Controlling Party at such
time, direct the exercise of remedies.
(b) PURCHASE RIGHTS OF CERTIFICATEHOLDERS: By acceptance of its
Certificate, each Certificateholder agrees that at any time after the occurrence
and during the continuation of a Triggering Event, each Certificateholder of
Certificates of a series will have certain rights, the exercise of which will be
specified in the applicable Trust Supplement, to purchase the class of
Certificates with immediate seniority to the Certificates held by the purchasing
Certificateholder. The purchase price with respect to the Certificates of any
series shall be equal to the Pool Balance of the Certificates of such series,
together with accrued and unpaid interest thereon to the date of such purchase,
without premium, but including any other amounts then due and payable to the
Certificateholders under this Agreement, any Intercreditor Agreement or any
other Note Document or on or in respect of the Certificates of such series;
provided, however, that no such purchase of Certificates of such series shall be
effective unless the purchaser shall certify to the Trustee that
contemporaneously with such purchase, such purchaser is purchasing, pursuant to
the terms of this Agreement and the other Agreements, if any, relating to
Certificates of a series that are subject to the same Intercreditor Agreement
(such other Agreements, the "Other Agreements"), the Certificates of each such
series that is senior to the Certificates held by such purchaser. Each payment
of the purchase price of the Certificates of any series shall be made to an
account or accounts designated by the Trustee and each such purchase shall be
subject to the terms of this Section. Each Certificateholder of any series
agrees by its acceptance of Certificates of such series that it will, upon
payment from any such Certificateholders of Certificates with a lower seniority
of the purchase price specified herein, forthwith sell, assign, transfer and
convey to the purchaser thereof (without recourse, representation or warranty of
any kind except for its own acts), all of the right, title, interest and
obligation of such Certificateholder in this Agreement, any Intercreditor
Agreement, the Liquidity Facility, the Note Documents and all Certificates of
such series held by such Certificateholder (excluding all right, title and
interest under any of the foregoing to the extent such right, title or interest
is with respect to an obligation not then due and payable as respects any action
or inaction or state of affairs occurring prior to such sale) and the purchaser
shall assume all of such Certificateholder's obligations under this Agreement,
any Intercreditor Agreement, the Liquidity Facility and the Note Documents. The
Certificates of such series will be deemed to be purchased on the date payment
of the purchase price is made notwithstanding the failure of the
Certificateholders to deliver any Certificates of such series and, upon such a
purchase, (i) the only rights of the Certificateholders will be to deliver the
Certificates to the purchaser and receive the purchase price for such
Certificates of such series and (ii) if the purchaser shall so request, such
Certificateholder will comply with all of the provisions of Section 3.04 hereof
to enable new Certificates of such series to be issued to the purchaser in such
denominations as it shall request. All charges and expenses in connection with
the issuance of any such new Certificates shall be borne by the purchaser
thereof.
Section 6.02. INCIDENTS OF SALE OF EQUIPMENT NOTES. Upon any sale of
all or any part of the Equipment Notes made either under the power of sale given
under this Agreement or otherwise for the enforcement of this Agreement, the
following shall be applicable:
(1) CERTIFICATEHOLDERS AND TRUSTEE MAY PURCHASE EQUIPMENT NOTES.
Any Certificateholder, the Trustee in its individual or any other capacity
or any other Person may
24
bid for and purchase any of the Equipment Notes, and upon compliance with
the terms of sale, may hold, retain, possess and dispose of such Equipment
Notes in their own absolute right without further accountability.
(2) RECEIPT OF TRUSTEE SHALL DISCHARGE PURCHASER. The receipt
of the Trustee or of the officer making such sale shall be a sufficient
discharge to any purchaser for his purchase money, and, after paying such
purchase money and receiving such receipt, such purchaser or its personal
representative or assigns shall not be obliged to see to the application
of such purchase money, or be in any way answerable for any loss,
misapplication or non-application thereof.
(3) APPLICATION OF MONEYS RECEIVED UPON SALE. Any moneys
collected by the Trustee upon any sale made either under the power of sale
given by this Agreement or otherwise for the enforcement of this Agreement
shall be applied as provided in Section 4.02.
Section 6.03. JUDICIAL PROCEEDINGS INSTITUTED BY TRUSTEE; TRUSTEE MAY
BRING SUIT. If there shall be a failure to make payment of the principal of,
premium, if any, or interest on any Equipment Note, or if there shall be any
failure to pay Rent (as defined in the relevant Lease) under any Lease when due
and payable, then the Trustee, in its own name, and as trustee of an express
trust, as holder of such Equipment Notes, to the extent permitted by and in
accordance with the terms of any Intercreditor Agreement and any Note Documents,
shall be entitled and empowered to institute any suits, actions or proceedings
at law, in equity or otherwise, for the collection of the sums so due and unpaid
on such Equipment Notes or under such Lease and may prosecute any such claim or
proceeding to judgment or final decree with respect to the whole amount of any
such sums so due and unpaid.
Section 6.04. CONTROL BY CERTIFICATEHOLDERS. Subject to Section 6.03
and any Intercreditor Agreement, the Certificateholders holding Certificates of
a series evidencing Fractional Undivided Interests aggregating not less than a
majority in interest in the related Trust shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee with respect to such Trust or pursuant to the terms of any
Intercreditor Agreement, or exercising any trust or power conferred on the
Trustee under this Agreement or any Intercreditor Agreement, including any right
of the Trustee as Controlling Party under any Intercreditor Agreement or as
holder of the Equipment Notes, PROVIDED that
(1) such Direction shall not in the opinion of the Trustee be in
conflict with any rule of law or with this Agreement and would not involve
the Trustee in personal liability or expense,
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Certificateholders of such series not
taking part in such Direction, and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such Direction.
Section 6.05. WAIVER OF PAST DEFAULTS. Subject to any Intercreditor
Agreement, the Certificateholders holding Certificates of a series evidencing
Fractional Undivided Interests aggregating not less than a majority in interest
in the Trust (i) may on behalf of all of the Certificateholders waive any past
Event of Default hereunder and its consequences or (ii) if the Trustee is the
Controlling Party, may direct the Trustee to instruct the applicable Loan
Trustee to waive, any past Indenture Default
25
under any Indenture and its consequences, and thereby annul any Direction given
by such Certificateholders or the Trustee to such Loan Trustee with respect
thereto, except a default:
(1) in the deposit of any Scheduled Payment or Special Payment
under Section 4.01 or in the distribution of any payment under Section
4.02 on the Certificates of a series, or
(2) in the payment of the principal of (premium, if any) or
interest on the Equipment Notes, or
(3) in respect of a covenant or provision hereof which under
Article IX hereof cannot be modified or amended without the consent of
each Certificateholder holding an Outstanding Certificate of a series
affected thereby.
Upon any such waiver, such default shall cease to exist with respect
to Certificates of such series and any Event of Default arising therefrom shall
be deemed to have been cured for every purpose and any direction given by the
Trustee on behalf of the Certificateholders of such series to the relevant Loan
Trustee shall be annulled with respect thereto; but no such waiver shall extend
to any subsequent or other default or Event of Default or impair any right
consequent thereon. Upon any such waiver, the Trustee shall vote the Equipment
Notes issued under the relevant Indenture to waive the corresponding Indenture
Default.
Section 6.06. RIGHT OF CERTIFICATEHOLDERS TO RECEIVE PAYMENTS NOT TO BE
IMPAIRED. Anything in this Agreement to the contrary notwithstanding,
including without limitation Section 6.07 hereof, but subject to any
Intercreditor Agreement, the right of any Certificateholder to receive
distributions of payments required pursuant to Section 4.02 hereof on the
applicable Certificates when due, or to institute suit for the enforcement of
any such payment on or after the applicable Regular Distribution Date or Special
Distribution Date, shall not be impaired or affected without the consent of such
Certificateholder.
Section 6.07. CERTIFICATEHOLDERS MAY NOT BRING SUIT EXCEPT UNDER CERTAIN
CONDITIONS. A Certificateholder of any series shall not have the right to
institute any suit, action or proceeding at law or in equity or otherwise with
respect to this Agreement, for the appointment of a receiver or for the
enforcement of any other remedy under this Agreement, unless:
(1) such Certificateholder previously shall have given written
notice to the Trustee of a continuing Event of Default;
(2) the Certificateholders holding Certificates of such series
evidencing Fractional Undivided Interests aggregating not less than 25% of
the related Trust shall have requested the Trustee in writing to institute
such action, suit or proceeding and shall have offered to the Trustee
indemnity as provided in Section 7.02(e);
(3) the Trustee shall have refused or neglected to institute any
such action, suit or proceeding for 60 days after receipt of such notice,
request and offer of indemnity; and
(4) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Certificateholders
holding Certificates of such series evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the related
Trust.
26
It is understood and intended that no one or more of the
Certificateholders of any series shall have any right in any manner whatever
hereunder or under the related Trust Supplement or under the Certificates of
such series to (i) surrender, impair, waive, affect, disturb or prejudice any
property in the Trust Property of the related Trust or the lien of any related
Indenture on any property subject thereto, or the rights of the
Certificateholders of such series or the holders of the related Equipment Notes,
(ii) obtain or seek to obtain priority over or preference to any other such
Certificateholder of such series or (iii) enforce any right under this
Agreement, except in the manner herein provided and for the equal, ratable and
common benefit of all the Certificateholders of such series subject to the
provisions of this Agreement.
Section 6.08. REMEDIES CUMULATIVE. Every remedy given hereunder to the
Trustee or to any of the Certificateholders of any series shall not be exclusive
of any other remedy or remedies, and every such remedy shall be cumulative and
in addition to every other remedy given hereunder or now or hereafter given by
statute, law, equity or otherwise.
Section 6.09. UNDERTAKING FOR COSTS. In any suit for the enforcement
of any right or remedy under this Agreement, or in any suit against the Trustee
for any action taken, suffered or omitted by it as Trustee, a court may require
any party litigant in such suit to file an undertaking to pay the costs of such
suit, and may assess costs against any such party litigant, in the manner and to
the extent provided in the Trust Indenture Act; PROVIDED that neither this
Section nor the Trust Indenture Act shall be deemed to authorize any court to
require such an undertaking or to make such an assessment in any suit instituted
by the Company or the Guarantor.
ARTICLE VII
THE TRUSTEE
Section 7.01. NOTICE OF DEFAULTS. As promptly as practicable after,
and in any event within 90 days after the occurrence of any default (as such
term is defined below) hereunder known to the Trustee, the Trustee shall
transmit by mail to the Company, any related Owner Trustees, the related Loan
Trustees and the Certificateholders holding Certificates of the related series
in accordance with Section 313(c) of the Trust Indenture Act, notice of such
default hereunder known to the Trustee, unless such default shall have been
cured or waived; PROVIDED, HOWEVER, that, except in the case of a default in
the payment of the principal of (premium, if any) or interest on any Equipment
Note, the Trustee shall be protected in withholding such notice if and so long
as the board of directors, the executive committee or a trust committee of
directors and/or Responsible Officers of the Trustee in good faith determine
that the withholding of such notice is in the interests of the
Certificateholders of the related series. For the purpose of this Section in
respect of any Trust, the term "default" means any event that is, or after
notice or lapse of time or both would become, an Event of Default in respect of
that Trust.
Section 7.02. CERTAIN RIGHTS OF TRUSTEE. Subject to the provisions of
Section 315 of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or refraining
from acting in reliance upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
27
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Request;
(c) whenever in the administration of this Agreement or any
Intercreditor Agreement the Trustee shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein specifically prescribed)
may, in the absence of bad faith on its part, rely upon an Officers' Certificate
of the Company, any related Owner Trustee or any related Loan Trustee;
(d) the Trustee may consult with counsel and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement or any Intercreditor Agreement
at the request or direction of any of the Certificateholders pursuant to this
Agreement or any Intercreditor Agreement unless such Certificateholders shall
have offered to the Trustee reasonable security or indemnity against the cost,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, or report, notice, request, direction, consent, order, bond, debenture
or other paper or document;
(g) the Trustee may execute any of the trusts or powers under this
Agreement or Intercreditor Agreement or perform any duties under this Agreement
or any Intercreditor Agreement either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
under this Agreement or any Intercreditor Agreement;
(h) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Certificateholders holding Certificates of any series evidencing Fractional
Undivided Interests aggregating not less than a majority in interest in the
related Trust relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Agreement or any Intercreditor
Agreement; and
(i) the Trustee shall not be required to expend or risk its own funds in
the performance of any of its duties under this Agreement, or in the exercise of
any of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk is not
reasonably assured to it.
(j) except during the continuance of an Event of Default, the Trustee
undertakes and shall be responsible to perform only such duties as are
specifically set forth herein and no implied covenants or obligations shall be
read into this Agreement or be enforceable against Trustee.
Section 7.03. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF CERTIFICATES.
The recitals contained herein and in the Certificates of each series, except the
certificates of authentication, shall not be taken as the statements of the
Trustee, and the Trustee assumes no responsibility for their correctness.
Subject to Section 7.14, the Trustee makes no representations as to the validity
or sufficiency of this Basic Agreement or any Trust Supplement, any Note
Documents, any Note Purchase Agreement or
28
any Intercreditor Agreement, any Equipment Notes or the Certificates of any
series, except that the Trustee hereby represents and warrants that this Basic
Agreement has been, and each Trust Supplement, each Certificate and each
Intercreditor Agreement of, or relating to, each series will be, executed and
delivered by one of its officers who is duly authorized to execute and deliver
such document on its behalf.
Section 7.04. MAY HOLD CERTIFICATES. The Trustee, any Paying Agent,
Registrar or any of their Affiliates or any other agent, in their respective
individual or any other capacity, may become the owner or pledgee of
Certificates and subject to Sections 310(b) and 311 of the Trust Indenture Act
may otherwise deal with the Company, the Guarantor, any Owner Trustees or the
Loan Trustees with the same rights it would have if it were not Trustee, Paying
Agent, Registrar or such other agent.
Section 7.05. MONEY HELD IN TRUST. Money held by the Trustee or the
Paying Agent in trust hereunder or under any Trust Supplement need not be
segregated from other funds except to the extent required herein or by law and
neither the Trustee nor the Paying Agent shall have any liability for interest
upon any such moneys except as provided for herein.
Section 7.06. COMPENSATION AND REIMBURSEMENT. The Company agrees:
(1) to pay, or cause to be paid, to the Trustee from time to time
reasonable compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein or in any Trust
Supplement, to reimburse, or cause to be reimbursed, the Trustee upon its
request for all reasonable out-of-pocket expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Basic Agreement, any Trust Supplement or any Intercreditor
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence, willful
misconduct or bad faith or as may be incurred due to the Trustee's breach
of its representations and warranties set forth in Section 7.14;
(3) to indemnify, or cause to be indemnified, the Trustee for, and
to hold it harmless against, any loss, liability or expense (other than
for or with respect to any tax) incurred without negligence, willful
misconduct or bad faith, on its part, arising out of or in connection with
the acceptance or administration of this Trust, including the costs and
expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder,
except for any such loss, liability or expense incurred by reason of the
Trustee's breach of its representations and warranties set forth in
Section 7.14. The Trustee shall notify the Company and the Guarantor
promptly of any claim for which it may seek indemnity. The Company and
the Guarantor shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel with the consent of
the Company and the Guarantor and the Company and the Guarantor will pay
the reasonable fees and expenses of such counsel. Neither the Company nor
the Guarantor need pay for any settlement made without its consent; and
(4) to indemnify, or cause to be indemnified, the Trustee, solely
in its individual capacity, for, and to hold it harmless against, any tax
(except to the extent the Trustee is reimbursed therefor pursuant to the
next paragraph, provided that no indemnification shall be available with
respect to any tax attributable to the Trustee's compensation for serving
as such)
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incurred without negligence, willful misconduct or bad faith, on its part,
arising out of or in connection with the acceptance or administration of
this Trust, including any costs and expenses incurred in contesting the
imposition of any such tax. The Trustee, in its individual capacity,
shall notify the Company and the Guarantor promptly of any claim for any
tax for which it may seek indemnity. The Trustee shall permit the Company
and the Guarantor to contest the imposition of such tax and the Trustee,
in its individual capacity, shall cooperate in the defense. The Trustee,
in its individual capacity, may have separate counsel with the consent of
the Company and the Guarantor and the Company and the Guarantor will pay
the reasonable fees and expenses of such counsel. Neither the Company nor
the Guarantor need pay for any taxes paid, in settlement or otherwise,
without its consent.
The Trustee shall be entitled to reimbursement from, and shall have a lien
prior to the Certificates of each series upon, all property and funds held or
collected by the Trustee in its capacity as Trustee with respect to such series
or the related Trust for any tax incurred without negligence, bad faith or
willful misconduct, on its part, arising out of or in connection with the
acceptance or administration of such Trust (other than any tax attributable to
the Trustee's compensation for serving as such), including any costs and
expenses incurred in contesting the imposition of any such tax. The Trustee
shall notify the Company of any claim for any tax for which it may seek
reimbursement. The Trustee shall cooperate in the contest by the Company of any
such claim. If the Trustee reimburses itself from the Trust Property of such
Trust for any such tax it will within 30 days mail a brief report setting forth
the amount of such tax and the circumstances thereof to all Certificateholders
of such series as their names and addresses appear in the Register.
As security for the performance of the obligations of the Company under
this Section with respect to each Trust the Trustee shall have a lien prior to
the Certificates of the related series upon all property and funds held or
collected by the Trustee in its capacity as Trustee with respect to such
Certificates and the related Trust.
Section 7.07. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY. Each Trust
shall at all times have a Trustee which shall be eligible to act as a trustee
under Section 310(a) of the Trust Indenture Act and shall have a combined
capital and surplus of at least $75,000,000 (or a combined capital and surplus
in excess of $5,000,000 and the obligations of which, whether now in existence
or hereafter incurred, are fully and unconditionally guaranteed by a corporation
organized and doing business under the laws of the United States, any State or
Territory thereof or of the District of Columbia that has a combined capital and
surplus of at least $75,000,000). If such corporation publishes reports of
conditions at least annually, pursuant to law or to the requirements of Federal,
State, Territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section 7.07, the combined capital and surplus of
such corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of conditions so published.
In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 7.07 to act as Trustee of any Trust, the
Trustee shall resign immediately as Trustee of such Trust in the manner and with
the effect specified in Section 7.08.
Section 7.08. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee of any Trust pursuant to this Article shall become effective
until the acceptance of appointment by the successor Trustee under Section 7.09.
30
(b) The Trustee may resign at any time as trustee of any or all Trusts
by giving written notice thereof to the Company, the Authorized Agents, the
related Owner Trustees and the related Loan Trustees. If an instrument of
acceptance by a successor Trustee shall not have been delivered to the Company,
the related Owner Trustees and the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time as trustee of any Trust by
Act of the Certificateholders of the related series holding Certificates of such
series evidencing Fractional Undivided Interests aggregating not less than a
majority in interest in such Trust delivered to the Trustee and to the Company,
the related Owner Trustees and the related Loan Trustees.
(d) If at any time in respect of any Trust:
(1) the Trustee shall fail to comply with Section 310 of the Trust
Indenture Act after written request therefor by the Company or by any
Certificateholder of the related series who has been a bona fide
certificateholder for at least six months; or
(2) the Trustee shall cease to be eligible under Section 7.07 and
shall fail to resign after written request therefor by the Company or by
any such Certificateholder; or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any case, (i) the Company may remove the Trustee or (ii) any
Certificateholder of the related series who has been a bona fide
Certificateholder for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee of such Trust.
(e) If a Responsible Officer of the Trustee shall obtain actual
knowledge of an Avoidable Tax (as hereinafter defined) in respect of any Trust
which has been or is likely to be asserted, the Trustee shall promptly notify
the Company and shall, within 30 days of such notification, resign as Trustee of
such Trust hereunder unless within such 30-day period the Trustee shall have
received notice that the Company has agreed to pay such tax. The Company shall
promptly appoint a successor Trustee of such Trust in a jurisdiction where there
are no Avoidable Taxes. As used herein, an "Avoidable Tax" in respect of such
Trust means a state or local tax: (i) upon (w) such Trust, (x) such Trust
Property, (y) Certificateholders of such Trust or (z) the Trustee for which the
Trustee is entitled to seek reimbursement from the Trust Property of such Trust,
and (ii) which would be avoided if the Trustee were located in another state, or
jurisdiction within a state, within the United States. A tax shall not be an
Avoidable Tax in respect of any Trust if the Company or any Owner Trustee shall
agree to pay, and shall pay, such tax.
(f) If the Trustee shall resign, be removed or become incapable of
acting as trustee of any Trust, or if a vacancy shall occur in the office of the
Trustee of any Trust for any cause, the Company shall promptly appoint a
successor Trustee of such Trust. If, within one year after such resignation,
removal or incapability, or other occurrence of such vacancy, a successor
Trustee of such Trust shall be appointed by Act of the Certificateholders of the
related series holding Certificates of such series evidencing Fractional
Undivided Interests aggregating not less than a majority in interest in such
Trust
31
delivered to the Company, the related Owner Trustees, the related Loan Trustee
and the retiring Trustee, the successor Trustees so appointed shall, with the
approval of the Company, which approval shall not be unreasonably withheld,
forthwith upon its acceptance of such appointment, become the successor Trustee
of such Trust and supersede the successor Trustee of such Trust appointed as
provided above. If no successor Trustee shall have been so appointed as
provided above and accepted appointment in the manner hereinafter provided, the
resigning Trustee or any Certificateholder who has been a bona fide
Certificateholder of the related series for at least six months may, on behalf
of himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee of such Trust.
(g) The successor Trustee of a Trust shall give notice of the
resignation and removal of the Trustee and appointment of the successor Trustee
by mailing written notice of such event by first-class mail, postage prepaid, to
the Certificateholders of the related series as their names and addresses appear
in the Register. Each notice shall include the name of such successor Trustee
and the address of its Corporate Trust Office.
Section 7.09. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. Every successor
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Company and to the retiring Trustee with respect to any or all Trusts an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee with respect to such Trusts shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee; but, on request of the Company or the successor Trustee, such retiring
Trustee shall execute and deliver an instrument transferring to such successor
Trustee all such rights, powers and trusts of the retiring Trustee and shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee in respect of such Trusts hereunder, subject
nevertheless to its lien, if any, provided for in Section 7.06. Upon request of
any such successor Trustee, the Company, the retiring Trustee and such successor
Trustee shall execute and deliver any and all instruments containing such
provisions as shall be necessary or desirable to transfer and confirm to, and
for more fully and certainly vesting in, such successor Trustee all such rights,
powers and trusts.
If a successor Trustee is appointed with respect to one or more (but not
all) Trusts, the Company, the predecessor Trustee and each successor Trustee
with respect to any Trust shall execute and deliver a supplemental agreement
hereto which shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
predecessor Trustee with respect to the Trusts as to which the predecessor
Trustee is not retiring shall continue to be vested in the predecessor Trustee,
and shall add to or change any of the provisions of this Basic Agreement and the
applicable Trust Supplements as shall be necessary to provide for or facilitate
the administration of the Trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental agreement shall
constitute such Trustees co-Trustees of the same Trust and that each such
Trustee shall be Trustee of separate Trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 7.10. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
Business. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise
32
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto. In case
any Certificates shall have been executed or authenticated, but not delivered,
by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such execution or
authentication and deliver the Certificates so executed or authenticated with
the same effect as if such successor Trustee had itself executed or
authenticated such Certificates.
Section 7.11. MAINTENANCE OF AGENCIES.
(a) With respect to each series of Certificates, there shall at all
times be maintained in the Borough of Manhattan, The City of New York, an office
or agency where Certificates of such series may be presented or surrendered for
registration of transfer or for exchange, and for payment thereof and where
notices and demands to or upon the Trustee in respect of such Certificates or of
the related Trust Supplement may be served. Such office or agency shall be
initially at 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000. Written notice of the
location of each such other office or agency and of any change of location
thereof shall be given by the Trustee to the Company, the Guarantor, any Owner
Trustees, the Loan Trustees and the Certificateholders of such series. In the
event that no such office or agency shall be maintained or no such notice of
location or of change of location shall be given, presentations and demands may
be made and notices may be served at the Corporate Trust Office of the Trustee.
(b) There shall at all times be a Registrar and a Paying Agent hereunder
with respect to the Certificates of each series. Each such Authorized Agent
shall be a bank or trust company, shall be a corporation organized and doing
business under the laws of the United States or any state, with a combined
capital and surplus of at least $75,000,000, or a corporation having a combined
capital and surplus in excess of $5,000,000 the obligations of which are
guaranteed by a corporation organized and doing business under the laws of the
United States or any state, with a combined capital and surplus of at least
$75,000,000, and shall be authorized under such laws to exercise corporate trust
powers, subject to supervision by Federal or state authorities. The Trustee
shall initially be the Paying Agent and, as provided in Section 3.04, Registrar
hereunder with respect to the Certificates of each series. Each Registrar shall
furnish to the Trustee, at stated intervals of not more than six months, and at
such other times as the Trustee may request in writing, a copy of the Register
maintained by such Registrar.
(c) Any corporation into which any Authorized Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authorized Agent shall
be a party, or any corporation succeeding to the corporate trust business of any
Authorized Agent, shall be the successor of such Authorized Agent hereunder, if
such successor corporation is otherwise eligible under this Section, without the
execution or filing of any paper or any further act on the part of the parties
hereto or such Authorized Agent or such successor corporation.
(d) Any Authorized Agent may at any time resign by giving written notice
of resignation to the Trustee, the Company, any related Owner Trustees and the
related Loan Trustees. The Company may, and at the request of the Trustee
shall, at any time terminate the agency of any Authorized Agent by giving
written notice of termination to such Authorized Agent and to the Trustee. Upon
the resignation or termination of an Authorized Agent or in case at any time any
such Authorized Agent shall cease to be eligible under this Section (when in
either case, no other Authorized Agent performing the functions of such
Authorized Agent shall have been appointed), the Company shall promptly appoint
one or more qualified successor Authorized Agents, reasonably
33
satisfactory to the Trustee, to perform the functions of the Authorized Agent
which has resigned or whose agency has been terminated or who shall have ceased
to be eligible under this Section. The Company shall give written notice of any
such appointment made by it to the Trustee, any related Owner Trustees and the
related Loan Trustees; and in each case the Trustee shall mail notice of such
appointment to all Certificateholders of the related series as their names and
addresses appear on the Register for such series.
(e) The Company agrees to pay, or cause to be paid, from time to time to
each Authorized Agent reasonable compensation for its services and to reimburse
it for its reasonable expenses.
Section 7.12. MONEY FOR CERTIFICATE PAYMENTS TO BE HELD IN TRUST. All
moneys deposited with any Paying Agent for the purpose of any payment on
Certificates shall be deposited and held in trust for the benefit of the
Certificateholders entitled to such payment, subject to the provisions of this
Section. Moneys so deposited and held in trust shall constitute a separate
trust fund for the benefit of the Certificateholders with respect to which such
money was deposited.
The Trustee may at any time, for the purpose of obtaining the satisfaction
and discharge of this Agreement or for any other purpose, direct any Paying
Agent to pay to the Trustee all sums held in trust by such Paying Agent, such
sums to be held by the Trustee upon the same trusts as those upon which such
sums were held by such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.
Section 7.13. REGISTRATION OF EQUIPMENT NOTES IN TRUSTEE'S NAME.
Subject to the provisions of any Intercreditor Agreement, the Trustee agrees
that all Equipment Notes, and Permitted Investments, if any, shall be issued in
the name of the Trustee as trustee for the applicable Trust or its nominee and
held by the Trustee, or, if not so held, the Trustee or its nominee shall be
reflected as the owner of such Equipment Notes or Permitted Investments as the
case may be, in the register of the issuer of such Equipment Notes or Permitted
Investments.
Section 7.14. REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The Trustee
hereby represents and warrants that:
(a) the Trustee is a Massachusetts trust company organized and
validly existing, and in good standing under the laws of the State of
Massachusetts;
(b) the Trustee has full power, authority and legal right to
execute, deliver, and perform this Agreement, any Intercreditor Agreement
and the Note Purchase Agreements and has taken all necessary action to
authorize the execution, delivery, and performance by it of this
Agreement, any Intercreditor Agreement and the Note Purchase Agreements;
(c) the execution, delivery and performance by the Trustee of this
Agreement, any Intercreditor Agreement and the Note Purchase Agreements
(i) will not violate any provision of any United States federal law or the
law of the State of Massachusetts governing the banking and trust powers
of the Trustee or any order, writ, judgment, or decree of any court,
arbitrator, or governmental authority applicable to the Trustee or any of
its assets, (ii) will not violate any provision of the articles of
association or by-laws of the Trustee, and (iii) will not violate any
provision of, or constitute, with or without notice or lapse of time, a
default under, or result in the creation or imposition of any lien on any
properties included in the Trust Property pursuant to the provisions of,
any mortgage, indenture, contract, agreement or other undertaking to which
it is a party, which violation, default or lien could reasonably be
34
expected to have an adverse effect on the Trustee's performance or ability
to perform its duties hereunder or thereunder or on the transactions
contemplated herein or therein;
(d) the execution, delivery and performance by the Trustee of this
Agreement any Intercreditor Agreement and the Note Purchase Agreements
will not require the authorization, consent, or approval of, the giving of
notice to, the filing or registration with, or the taking of any other
action in respect of, any governmental authority or agency of the United
States or the State of Massachusetts regulating the banking and corporate
trust activities of the Trustee; and
(e) this Agreement, any Intercreditor Agreement and the Note
Purchase Agreements have been duly executed and delivered by the Trustee
and constitute the legal, valid, and binding agreements of the Trustee,
enforceable against it in accordance with their respective terms, provided
that enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally and (ii) general principles of equity.
Section 7.15. WITHHOLDING TAXES; INFORMATION REPORTING. As to the
Certificates of any series, the Trustee, as trustee of the related grantor trust
created by this Agreement, shall exclude and withhold from each distribution of
principal, premium, if any, and interest and other amounts due under this
Agreement or under the Certificates of such series any and all withholding taxes
applicable thereto as required by law. The Trustee agrees to act as such
withholding agent and, in connection therewith, whenever any taxes or similar
charges are required to be withheld with respect to any amounts paid by or on
behalf of the Trustee in respect of the Certificates of such series, to withhold
such amounts and timely pay the same to the authority in the name of and on
behalf of the Certificateholders of such series, that it will file any necessary
withholding tax returns or statements when due, and that, as promptly as
possible after the payment thereof, it will deliver to each such
Certificateholder necessary documentation showing the payment thereof, together
with such additional documentary evidence as such Certificateholders of such
series may reasonably request from time to time. The Trustee agrees to file any
other information reports as it may be required to file under United States law.
Section 7.16. TRUSTEE'S LIENS. The Trustee in its individual capacity
agrees that it will, in respect of each Trust created by this Agreement at its
own cost and expense promptly take any action as may be necessary to duly
discharge and satisfy in full any mortgage, pledge, lien, charge, encumbrance,
security interest or claim ("Trustee's Liens") on or with respect to the Trust
Property of such Trust which is attributable to the Trustee either (i) in its
individual capacity and which is unrelated to the transactions contemplated by
this Agreement, the related Note Purchase Agreements or the related Note
Documents, or (ii) as Trustee hereunder or in its individual capacity and which
arises out of acts or omissions which are not contemplated by this Agreement.
Section 7.17. PREFERENTIAL COLLECTION OF CLAIMS. The Trustee shall
comply with Section 311(a) of the Trust Indenture Act, excluding any creditor
relationship listed in Section 311(b) of the Trust Indenture Act. If the
Trustee shall resign or be removed as Trustee, it shall be subject to Section
311(a) of the Trust Indenture Act to the extent provided therein.
35
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE
Section 8.01. THE COMPANY TO FURNISH TRUSTEE WITH NAMES AND ADDRESSES OF
CERTIFICATEHOLDERS. The Company will furnish to the Trustee within 15 days
after each Record Date with respect to a Scheduled Payment, and at such other
times as the Trustee may request in writing, within 30 days after receipt by the
Company of any such request, a list, in such form as the Trustee may reasonably
require, of all information in the possession or control of the Company as to
the names and addresses of the Certificateholders of such series, in each case
as of a date not more than 15 days prior to the time such list is furnished;
PROVIDED, HOWEVER, that so long as the Trustee is the sole Registrar for
such series, no such list need be furnished; and PROVIDED FURTHER,
HOWEVER, that no such list need be furnished for so long as a copy of the
Register is being furnished to the Trustee pursuant to Section 7.11.
Section 8.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO
CERTIFICATEHOLDERS. The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Certificateholders of each
series contained in the most recent list furnished to the Trustee as provided in
Section 7.11 or Section 8.01, as the case may be, and the names and addresses of
Certificateholders of each series received by the Trustee in its capacity as
Registrar, if so acting. The Trustee may destroy any list furnished to it as
provided in Section 7.11 or Section 8.01, as the case may be, upon receipt of a
new list so furnished.
Section 8.03. REPORTS BY TRUSTEE. Within 60 days after May 15 of each
year commencing with the first full year following the issuance of any series of
Certificates, the Trustee shall transmit to the Certificateholders of each
series, as provided in Section 313(c) of the Trust Indenture Act, a brief report
dated as of such May 15, if required by Section 313(a) of the Trust Indenture
Act.
Section 8.04. REPORTS BY THE GUARANTOR AND COMPANY. The Guarantor and
the Company each shall:
(a) file with the Trustee, within 30 days after the Guarantor or the
Company is required to file the same with the SEC, copies of the annual reports
and of the information, documents and other reports (or copies of such portions
of any of the foregoing as the SEC may from time to time by rules and
regulations prescribe) which the Guarantor or the Company is required to file
with the SEC pursuant to section 13 or section 15(d) of the Securities Exchange
Act of 1934, as amended; or, if the Guarantor or the Company is not required to
file information, documents or reports pursuant to either of such sections, then
to file with the Trustee and the SEC, in accordance with rules and regulations
prescribed by the SEC, such of the supplementary and periodic information,
documents and reports which may be required pursuant to section 13 of the
Securities Exchange Act of 1934, as amended, in respect of a security listed and
registered on a national securities exchange as may be prescribed in such rules
and regulations;
(b) file with the Trustee and the SEC, in accordance with the rules and
regulations prescribed by the SEC, such additional information, documents and
reports with respect to compliance by the Guarantor and the Company with the
conditions and covenants of the Guarantor and the Company provided for in this
Agreement, as may be required by such rules and regulations, including, in the
case of annual reports, if required by such rules and regulations, certificates
or opinions of independent public accountants, conforming to the requirements of
Section 1.02;
36
(c) transmit to all Certificateholders, in the manner and to the extent
provided in Section 313(c) of the Trust Indenture Act such summaries of any
information, documents and reports required to be filed by the Guarantor and the
Company pursuant to subsections (a) and (b) of this Section 8.04 as may be
required by rules and regulations prescribed by the SEC;
(d) furnish to the Trustee, not less often than annually, a brief
certificate from the principal executive officer, principal financial officer or
principal accounting officer as to his or her knowledge of the Guarantor's and
the Company's compliance with all conditions and covenants under this Agreement
(it being understood that for purposes of this paragraph (d), such compliance
shall be determined without regard to any period of grace or requirement of
notice provided under this Agreement); and
(e) make available to any Certificateholder upon request, the annual
audited and quarterly unaudited financial statements of the Guarantor which are
provided to the Trustee.
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
Section 9.01. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF
CERTIFICATEHOLDERS. Without the consent of the Certificateholders, the
Guarantor and the Company may, and the Trustee (subject to Section 9.03) shall,
at any time and from time to time, enter into one or more agreements
supplemental hereto or, if applicable, to the Intercreditor Agreement or a Note
Purchase Agreement in form satisfactory to the Trustee, for any of the following
purposes:
(1) to provide for the formation of a Trust, the issuance of a
series of certificates and the other matters contemplated by Section 2.01(b); or
(2) to evidence the succession of another corporation to the
Company or the Guarantor and the assumption by any such successor of the
covenants of the Company or the Guarantor herein contained; or
(3) to add to the covenants of the Guarantor or the Company for
the benefit of the Certificateholders of any series, or to surrender any right
or power in this Agreement conferred upon the Guarantor or the Company; or
(4) to correct or supplement any provision in this Agreement which
may be defective or inconsistent with any other provision herein or in any Trust
Supplement or to make any other provisions with respect to matters or questions
arising under this Agreement, provided that any such action shall not adversely
affect the interests of the Certificateholders of any series; or to cure any
ambiguity or correct any mistake; or
(5) to modify, eliminate or add to the provisions of this
Agreement to such extent as shall be necessary to continue the qualification of
this Agreement (including any supplemental agreement) under the Trust Indenture
Act, or under any similar Federal statute hereafter enacted, and to add to this
Agreement such other provisions as may be expressly permitted by the Trust
Indenture Act, excluding, however, the provisions referred to in Section
316(a)(2) of the Trust Indenture Act as in effect at the date as of which this
instrument was executed or any corresponding provision in any similar Federal
statute hereafter enacted; or
37
(6) to evidence and provide for the acceptance of appointment
under this Agreement by a successor Trustee with respect to one or more Trusts
and to add to or change any of the provisions of this Agreement as shall be
necessary to provide for or facilitate the administration of the Trusts
hereunder and thereunder by more than one Trustee, pursuant to the requirements
of Section 7.09; or
(7) to make any other amendments or modifications hereto, provided
such amendments or modifications shall only apply to Certificates of one or more
series to be thereafter issued.
Section 9.02. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF
CERTIFICATEHOLDERS. With respect to each separate Trust and the series of
Certificates relating thereto, with the consent of the Certificateholders
holding Certificates of any series evidencing Fractional Undivided Interests
aggregating not less than a majority in interest in such Trust, by Act of said
Certificateholders delivered to the Guarantor, the Company and the Trustee, the
Guarantor and the Company may (with the consent of the Owner Trustee, if any,
relating to such certificates, which consent shall not be unreasonably
withheld), and the Trustee (subject to Section 9.03) shall, enter into an
agreement or agreements supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement, any Intercreditor Agreement or any Note Purchase Agreement to
the extent applicable to such Certificateholders or of modifying in any manner
the rights and obligations of such Certificateholders under this Agreement;
PROVIDED, HOWEVER, that no such supplemental agreement shall, without the
consent of the Certificateholder of each Outstanding Certificate affected
thereby:
(1) reduce in any manner the amount of, or delay the timing of,
any receipt by the Trustee of payments on the Equipment Notes held in such Trust
or distributions that are required to be made herein on any Certificate of such
series, or change any date of payment of any Certificate of such series, or
change the place of payment where, or the coin or currency in which, any
Certificate of such series is payable, or impair the right to institute suit for
the enforcement of any such payment or distribution on or after the Regular
Distribution Date or Special Distribution Date applicable thereto; or
(2) permit the disposition of any Equipment Note in the Trust
Property of such Trust except as permitted by this Agreement, or otherwise
deprive such Certificateholder of the benefit of the ownership of the Equipment
Notes in such Trust; or
(3) alter the priority of distributions specified in the
Intercreditor Agreement; or
(4) reduce the percentage of the aggregate Fractional Undivided
Interests of such Trust which is required for any such supplemental agreement,
or reduce such percentage required for any waiver (of compliance with certain
provisions of this Agreement or certain defaults hereunder and their
consequences) provided for in this Agreement; or
(5) modify any of the provisions of this Section or Section 6.05,
except to increase any such percentage or to provide that certain other
provisions of this Agreement cannot be modified or waived without the consent of
the Certificateholder of each Certificate or such series affected thereby.
It shall not be necessary for any Act of such Certificateholders under
this Section to approve the particular form of any proposed supplemental
agreement, but it shall be sufficient if such Act shall approve the substance
thereof.
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Section 9.03. DOCUMENTS AFFECTING IMMUNITY OR INDEMNITY. If in the
opinion of the Trustee any document required to be executed by it pursuant to
the terms of Section 9.01 or 9.02 affects any interest, right, duty, immunity or
indemnity in favor of the Trustee under this Basic Agreement or any Trust
Supplement, the Trustee may in its discretion decline to execute such document.
Section 9.04. EXECUTION OF SUPPLEMENTAL AGREEMENTS. In executing, or
accepting the additional trusts created by, any supplemental agreement permitted
by this Article or the modifications thereby of the trusts created by this
Agreement, the Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental agreement is authorized or permitted by this Agreement.
Section 9.05. EFFECT OF SUPPLEMENTAL AGREEMENTS. Upon the execution of
any supplemental agreement under this Article, this Basic Agreement shall be
modified in accordance therewith, and such supplemental agreement shall form a
part of this Basic Agreement for all purposes; and every Certificateholder of
each series theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby to the extent applicable to such series.
Section 9.06. CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
agreement executed pursuant to this Article shall conform to the requirements of
the Trust Indenture Act as then in effect.
Section 9.07. REFERENCE IN CERTIFICATES TO SUPPLEMENTAL AGREEMENTS.
Certificates of each series authenticated and delivered after the execution of
any supplemental agreement applicable to such series pursuant to this Article
may bear a notation in form approved by the Trustee as to any matter provided
for in such supplemental agreement; and, in such case, suitable notation may be
made upon Outstanding Certificates of such series after proper presentation and
demand.
ARTICLE X
AMENDMENTS TO INDENTURE AND NOTE DOCUMENTS
Section 10.01. AMENDMENTS AND SUPPLEMENTS TO INDENTURE AND OTHER NOTE
DOCUMENTS. In the event that the Trustee, as holder of any Equipment Notes in
trust for the benefit of the Certificateholders of any series or as Controlling
Party, receives a request for a consent to any amendment, modification, waiver
or supplement under any Indenture or other Note Document the Trustee shall
forthwith send a notice of such proposed amendment, modification, waiver or
supplement to each Certificateholder of such series registered on the Register
as of the date of such notice. The Trustee shall request from
Certificateholders of such series a Direction as to (a) whether or not to take
or refrain from taking any action which a holder of such Equipment Note has the
option to direct, (b) whether or not to give or execute any waivers, consents,
amendments, modifications or supplements as a holder of such Equipment Note and
(c) how to vote any Equipment Note if a vote has been called for with respect
thereto. Provided such a request for Certificateholder Direction shall have
been made, in directing any action or casting any vote or giving any consent as
the holder of any Equipment Note, the Trustee shall vote for or give consent to
any such action with respect to such Equipment Note in the same proportion as
that of (i) the aggregate face amounts of all Certificates of such series
actually voted in favor of or for giving consent to such action by Acts of
Certificateholders to (ii) the aggregate face amount of all Outstanding
Certificates. For purposes of the immediately preceding sentence, a Certificate
shall have been "actually voted" if the Holder of such Certificate has delivered
to the Trustee an instrument evidencing such Holder's consent to such Direction
on or prior to the Business Day before the Trustee directs such action or casts
such vote or gives such consent. Notwithstanding the foregoing, but subject to
Section 6.04 and any Intercreditor Agreement, the Trustee may, in its
39
own discretion and at its own direction consent and notify the relevant Loan
Trustee of such consent to any amendment, modification, waiver or supplement
under the relevant Indenture, Liquidity Facility, or any Note Document, if an
Event of Default hereunder shall have occurred and be continuing, or if such
amendment, modification or waiver will not adversely affect the interests of the
Certificateholders.
ARTICLE XI
TERMINATION OF TRUSTS
Section 11.01. TERMINATION OF THE TRUSTS. In respect of each Trust
created by the Basic Agreement as supplemented by a related Trust Supplement,
the respective obligations and responsibilities of the Company, the Guarantor
and the Trustee created under this Agreement and the Trust created hereby and
such Trust shall terminate upon the distribution to all Holders of the
Certificates of the series of such Trust and the Trustee of all amounts required
to be distributed to them pursuant to this Agreement and the disposition of all
property held as part of the Trust Property of the related series of such Trust;
PROVIDED, HOWEVER, that in no event shall such Trust continue beyond the
final expiration date determined as provided in this Agreement.
Notice of any termination of a Trust, specifying the applicable Regular
Distribution Date (or applicable Special Distribution Date, as the case may be)
upon which the Certificateholders of any series may surrender their Certificates
to the Trustee for payment of the final distribution and cancellation, shall be
mailed promptly by the Trustee to Certificateholders of such series not earlier
than the minimum number of days and not more than the maximum number of days
specified therefor in the related Trust Supplement preceding such final
distribution specifying (a) the Regular Distribution Date (or Special
Distribution Date, as the case may be) upon which the proposed final payment of
the Certificates of such series will be made upon presentation and surrender of
Certificates of such series at the office or agency of the Trustee therein
specified, (b) the amount of any such proposed final payment, and (c) that the
Record Date otherwise applicable to such Regular Distribution Date (or Special
Distribution Date, as the case may be) is not applicable, payments being made
only upon presentation and surrender of the Certificates of such series at the
office or agency of the Trustee therein specified. The Trustee shall give such
notice to the Registrar at the time such notice is given to Certificateholders
of such series. Upon presentation and surrender of the Certificates of such
series, the Trustee shall cause to be distributed to Certificateholders of such
series amounts distributable on such Regular Distribution Date (or Special
Distribution Date, as the case may be) pursuant to Section 4.02.
In the event that all of the Certificateholders of such series shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders of such series to surrender
their Certificates for cancellation and receive the final distribution with
respect thereto. In the event that any money held by the Trustee for the
payment of distributions on the Certificates of such series shall remain
unclaimed for two years (or such lesser time as the Trustee shall be satisfied,
after sixty days' notice from the Company, is one month prior to the escheat
period provided under applicable law) after the final distribution date with
respect thereto, the Trustee shall pay to each Loan Trustee the appropriate
amount of money relating to such Loan Trustee and shall give written notice
thereof to the related Owner Trustees and the Company.
40
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death
or incapacity of any Certificateholder of any series shall not operate to
terminate this Agreement, or the related Trust, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a partition or
winding up of the Trust, nor otherwise affect the rights, obligations, and
liabilities of the parties hereto or any of them.
Section 12.02. LIABILITIES OF CERTIFICATEHOLDERS. Neither the
existence of the Trust nor any provision in this Agreement is intended to or
shall limit the liability the Certificateholders would otherwise incur if the
Certificateholders owned Trust Property as co-owners, or incurred any
obligations of the Trust, directly rather than through the Trust.
Section 12.03. CERTIFICATES NONASSESSABLE AND FULLY PAID.
Certificateholders of each series shall not be personally liable for obligations
of the related Trust, the Fractional Undivided Interests represented by the
Certificates of such series shall be nonassessable for any losses or expenses of
such Trust or for any reason whatsoever, and Certificates of such series upon
authentication thereof by the Trustee pursuant to Section 3.02 are and shall be
deemed fully paid. No Certificateholder of such series shall have any right
(except as expressly provided herein) to vote or in any manner otherwise control
the operation and management of the related Trust Property, the related Trust,
or the obligations of the parties hereto, nor shall anything set forth herein,
or contained in the terms of the Certificates of such series, be construed so as
to constitute the Certificateholders of such series from time to time as
partners or members of an association.
Section 12.04. REGISTRATION OF EQUIPMENT NOTES IN NAME OF SUBORDINATION
Agent. If a Trust is party to an Intercreditor Agreement, the Trustee agrees
that all Equipment Notes to be purchased by such Trust shall be issued in the
name of the Subordination Agent under such Intercreditor Agreement or its
nominee and held by such Subordination Agent in trust for the benefit of the
Certificateholders, or, if not so held, such Subordination Agent or its nominee
shall be reflected as the owner of such Equipment Notes in the register of the
issuer of such Equipment Notes.
Section 12.05. NOTICES.
(a) Unless otherwise specifically provided herein or in the applicable
Trust Supplement with respect to any Trust, all notices required under the terms
and provisions of this Basic Agreement or such Trust Supplement with respect to
such Trust shall be in English and in writing, and any such notice may be given
by United States mail, courier service, telegram, telex, telemessage, telecopy,
telefax, cable or facsimile (confirmed by telephone or in writing in the case of
notice by telegram, telex, telemessage, telecopy, telefax, cable or facsimile)
or any other customary means of communication, and any such notice shall be
effective when delivered, or if mailed, three days after deposit in the United
States mail with proper postage for ordinary mail prepaid,
if to the Company or the Guarantor, to:
MAIL: Northwest Airlines, Inc.
0000 Xxxxxxxxx Xxxxx
Xx. Xxxx, Xxxxxxxxx 00000-0000
41
COURIER: 0000 Xxxx Xxx Xxxxxxx
Xxxxx, Xxxxxxxxx 00000
ATTENTION: Senior Vice President-Finance and Treasurer
FACSIMILE: (000) 000-0000
if to the Trustee, to:
State Street Bank and Trust Company
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Corporate Trust Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(b) The Company, the Guarantor or the Trustee, by notice to the other,
may designate additional or different addresses for subsequent notices or
communications.
(c) Any notice or communication to Certificateholders of any series
shall be mailed by first-class mail to the addresses for Certificateholders of
such series shown on the Register kept by the Registrar and to addresses filed
with the Trustee for Certificate Owners of such series. Failure so to mail a
notice or communication or any defect in such notice or communication shall not
affect its sufficiency with respect to other Certificateholders or Certificate
Owners of such series.
(d) If a notice or communication is mailed in the manner provided above
within the time prescribed, it is conclusively presumed to have been duly given,
whether or not the addressee receives it.
(e) If the Company mails a notice or communication to the
Certificateholders of such series, it shall mail a copy to the Trustee and to
each Paying Agent for such series at the same time.
(f) Notwithstanding the foregoing, all communications or notices to the
Trustee shall be deemed to be given only when received by a Responsible Officer
of the Trustee.
(g) The Trustee shall promptly furnish the Company with a copy of any
demand, notice or written communication received by the Trustee hereunder from
any Certificateholder, Owner Trustee or Loan Trustee.
Section 12.06. GOVERNING LAW. THIS BASIC AGREEMENT HAS BEEN DELIVERED
IN THE STATE OF NEW YORK AND, TOGETHER WITH ALL TRUST SUPPLEMENTS AND
CERTIFICATES, SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK AND THE OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 12.07. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions, or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions, or
terms shall be deemed severable from the remaining covenants,
42
agreements, provisions, or terms of this Agreement and shall in no way affect
the validity or enforceability of the other provisions of this Agreement or any
Trust, or of the Certificates of any series or the rights of the
Certificateholders thereof.
Section 12.08. TRUST INDENTURE ACT CONTROLS. This Agreement is subject
to the provisions of the Trust Indenture Act and shall, to the extent
applicable, be governed by such provisions.
Section 12.09. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
Section 12.10. SUCCESSORS AND ASSIGNS. All covenants, agreements,
representations and warranties in this Agreement by the Trustee, the Guarantor
and the Company shall bind and, to the extent permitted hereby, shall inure to
the benefit of and be enforceable by their respective successors and assigns,
whether so expressed or not.
Section 12.11. BENEFITS OF AGREEMENT. Nothing in this Agreement or in
the Certificates of any series, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, and the
Certificateholders of each series, any benefit or any legal or equitable right,
remedy or claim under this Agreement.
Section 12.12. LEGAL HOLIDAYS. In any case where any Regular
Distribution Date or Special Distribution Date relating to any Certificate of
any series shall not be a Business Day with respect to such series, then
(notwithstanding any other provision of this Agreement) payment need not be made
on such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on such Regular Distribution Date or Special
Distribution Date, and no interest shall accrue during the intervening period.
Section 12.13. COUNTERPARTS. For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
Section 12.14. COMMUNICATION BY CERTIFICATEHOLDERS WITH OTHER
Certificateholders. Certificateholders of any series may communicate with
other Certificateholders of such series with respect to their rights under this
Basic Agreement, the related Trust Supplement or the Certificates of such series
pursuant to Section 3.12(b) of the Trust Indenture Act. The Company, the
Guarantor, the Trustee and any and all other persons benefitted by this
Agreement shall have the protection afforded by Section 312(c) of the Trust
Indenture Act.
43
IN WITNESS WHEREOF, the Guarantor, the Company and the Trustee have caused
this Basic Agreement to be duly executed by their respective officers, all as of
the day and year first above written.
NORTHWEST AIRLINES CORPORATION
By /s/ Xxxxxx X. Xxxxxxxx, Xx.
------------------------------
Title: Vice President - Finance
and Assistant Treasurer
NORTHWEST AIRLINES, INC.
By /s/ Xxxxxx X. Xxxxxxxx, Xx.
------------------------------
Title: Vice President - Finance
and Assistant Treasurer
STATE STREET BANK AND TRUST
COMPANY,
as Trustee
By /s/ Xxxxxx X. Xxxxx
------------------------------
Title: Xxxxxx X. Xxxxx
Vice President
EXHIBIT A
FORM OF CERTIFICATE
(1)Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
NORTHWEST AIRLINES __________ PASS THROUGH TRUST
Pass Through
Certificate, Series __________
Final Distribution Date: __________, _____
evidencing a fractional undivided interest in
a trust, the property of which includes
certain equipment notes each secured by
Aircraft owned by or leased to Northwest
Airlines, Inc.
Certificate
No. __________ $__________ Fractional Undivided Interest representing
.__________% of the Trust per $1,000 face amount
THIS CERTIFIES THAT __________________________, for value received, is the
registered owner of a $_____________________ (______________ dollars) Fractional
Undivided Interest in the Northwest Airlines Pass Through Trust (the "Trust")
created by State Street Bank and Trust Company, as trustee (the "Trustee"),
pursuant to a Pass Through Trust Agreement dated as of ______, 1996 (the "Basic
Agreement"), as supplemented by Trust Supplement No. ___________ thereto dated
__________, 199___ (collectively, the "Agreement"), among the Trustee, Northwest
Airlines Corporation, a corporation incorporated under Delaware law (the
"Guarantor"), and Northwest Airlines, Inc., a corporation incorporated under
Minnesota law (the "Company"), a summary of certain of the pertinent provisions
of which is set forth below. To the extent not otherwise defined herein, the
capitalized terms used herein have the meanings assigned to them in the
Agreement. This Certificate is one of the duly authorized Certificates
designated as "Pass Through Certificates, Series _____________" (herein called
the "Certificates"). This Certificate is issued under and is subject to the
terms, provisions, and conditions of the Agreement, to which Agreement the
Certificateholder of this Certificate by virtue of the acceptance hereof assents
and by which such Certificateholder is bound. The property of the Trust
includes certain
---------------------
(1)/This legend to appear on Book-Entry Certificates to be deposited with the
Depository Trust Company. One Certificate may be issued in a denomination of
less than $1,000 which shall not have this legend.
2
Equipment Notes and all rights of the Trust to receive any payments under any
Intercreditor Agreement or Liquidity Facility (the "Trust Property"). Each
issue of the Equipment Notes is secured by a security interest in aircraft
leased to or owned by the Company.
The Certificates represent fractional undivided interests in the Trust and
the Trust Property, and have no rights, benefits or interest in respect of any
other separate trust established pursuant to the terms of the Basic Agreement
for any other series of certificates issued pursuant thereto. [The undivided
percentage interest in the Trust represented by each of this Certificate (as
specified above) and the other Pass Through Certificates, Series 1996-[_____],
was determined on the basis of (x) the aggregate of the Reference Principal
Amount of this Certificate (as specified above) and of the other Pass Through
Certificates, Series 1996-[______] and (y) the aggregate original principal
amounts of the Equipment Notes constituting the Trust Property.]
Subject to and in accordance with the terms of the Agreement and any
Intercreditor Agreement, from funds then available to the Trustee, there will be
distributed on each ____________ and ________________ (a "Regular Distribution
Date"), commencing on _______________, 199__, to the Person in whose name this
Certificate is registered at the close of business on the 15th day preceding the
Regular Distribution Date, an amount in respect of the Scheduled Payments on the
Equipment Notes due on such Regular Distribution Date, the receipt of which has
been confirmed by the Trustee, equal to the product of the percentage interest
in the Trust evidenced by this Certificate and an amount equal to the sum of
such Scheduled Payments. Subject to and in accordance with the terms of the
Agreement, in the event that Special Payments on the Equipment Notes are
received by the Trustee, from funds then available to the Trustee, there shall
be distributed on the applicable Special Distribution Date, to the Person in
whose name this Certificate is registered at the close of business on the 15th
day preceding the Special Distribution Date, an amount in respect of such
Special Payments on the Equipment Notes, the receipt of which has been confirmed
by the Trustee, equal to the product of the percentage interest in the Trust
evidenced by this Certificate and an amount equal to the sum of such Special
Payments so received. If a Regular Distribution Date or Special Distribution
Date is not a Business Day, distribution shall be made on the immediately
following Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each Special
Payment and the Special Distribution Date therefor to the Certificateholder of
this Certificate.
Distributions on this Certificate will be made by the Trustee by check
mailed to the Person entitled thereto, without the presentation or surrender of
this Certificate or the making of any notation hereon. Except as otherwise
provided in the Agreement and notwithstanding the above, the final distribution
on this Certificate will be made after notice mailed by the Trustee of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such notice.
The Certificates do not represent a direct obligation of, or an obligation
guaranteed by, or an interest in, the Guarantor, the Company or the Trustee or
any affiliate thereof. The Certificates are limited in right or payment, all as
more specifically set forth on the face hereof and in the Agreement. All
payments or distributions made to Certificateholders under the Agreement shall
be made only from the Trust Property and only to the extent that the Trustee
shall have sufficient income or proceeds from the Trust Property to make such
payments in accordance with the terms of the Agreement. Each Certificateholder
of this Certificate, by its acceptance hereof, agrees that it will look solely
to the income and proceeds from the Trust Property to the extent available for
distribution to such Certificateholder as provided in the Agreement. This
Certificate does not purport to summarize the Agreement and reference is made to
the Agreement for information with respect to the interests, rights, benefits,
obligations,
3
proceeds, and duties evidenced hereby. A copy of the Agreement may be examined
during normal business hours at the principal office of the Trustee, and at such
other places, if any, designated by the Trustee, by any Certificateholder upon
request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Agreement at any time
by the Company and the Trustee with the consent of the Certificateholders
holding Certificates evidencing Fractional Undivided Interests aggregating not
less than a majority in interest in the Trust. Any such consent by the
Certificateholder of this Certificate shall be conclusive and binding on such
Certificateholder and upon all future Certificateholders of this Certificate and
of any Certificate issued upon the transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Certificateholders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations set forth,
the transfer of this Certificate is registrable in the Register upon surrender
of this Certificate for registration of transfer at the offices or agencies
maintained by the Trustee in its capacity as Registrar, or by any successor
Registrar duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Trustee and the Registrar, duly executed by the
Certificateholder hereof or such Certificateholder's attorney duly authorized in
writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate Fractional Undivided Interest in the Trust will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in minimum denominations of $1,000 Fractional Undivided Interest and
integral multiples thereof except that one Certificate may be in a denomination
of less than $1,000. As provided in the Agreement and subject to certain
limitations therein set forth, the Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same aggregate
Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee shall require payment of a sum sufficient to cover any
tax or governmental charge payable in connection therewith.
The Trustee, the Registrar, and any agent of the Trustee or the Registrar
may treat the person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Trustee, the Registrar, nor any such
agent shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and the
Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them pursuant to
the Agreement and the disposition of all property held as part of the Trust
Property.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAWS PROVISIONS OF THE STATE OF NEW YORK.
Unless the certificate of authentication hereon has been executed by the
Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
NORTHWEST AIRLINES PASS THROUGH TRUST
By: STATE STREET BANK AND TRUST COMPANY,
as Trustee
By
----------------------------------
Title:
----------------------------------
Dated:
--------------------
[FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Certificates referred
to in the within-mentioned Agreement.
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By: ________________________________
Authorized Officer
