1
EXHIBIT 4(B)(1)
INTERCREDITOR AGREEMENT
Dated as of November 16, 2000
among
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
as Trustee of the
Delta Air Lines Pass Through Trust 2000-1A-1,
Delta Air Lines Pass Through Trust 2000-1A-2,
Delta Air Lines Pass Through Trust 2000-1B
and
Delta Air Lines Pass Through Trust 0000-0X
XXXXXXXXXXXX XXXXXXXXXX XXXXXXXXXXXX, XXX XXXX BRANCH,
as Class A-1 Liquidity Provider,
Class A-2 Liquidity Provider,
Class B Liquidity Provider,
and
Class C Liquidity Provider
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
as Subordination Agent
2
TABLE OF CONTENTS
PAGE
----
ARTICLE I
DEFINITIONS
Section 1.01. Definitions................................................................................. 2
ARTICLE II
TRUST ACCOUNTS; CONTROLLING PARTY
Section 2.01. Agreement to Terms of Subordination; Payments from Monies Received Only.................... 20
Section 2.02. Trust Accounts............................................................................. 20
Section 2.03. Deposits to the Collection Account and Special Payments Account; Certain Distributions..... 22
Section 2.04. Distributions of Special Payments.......................................................... 22
Section 2.05. Designated Representatives................................................................. 25
Section 2.06. Controlling Party.......................................................................... 26
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED
Section 3.01. Written Notice of Distribution............................................................. 27
Section 3.02. Distribution of Amounts on Deposit in the Collection Account............................... 29
Section 3.03. Distribution of Amounts on Deposit Following a Triggering Event............................ 31
Section 3.04. Other Payments............................................................................. 34
Section 3.05. Payments to the Trustees and the Liquidity Providers....................................... 34
Section 3.06. Liquidity Facilities....................................................................... 34
ARTICLE IV
EXERCISE OF REMEDIES
Section 4.01. Directions from the Controlling Party...................................................... 42
Section 4.02. Remedies Cumulative........................................................................ 43
Section 4.03. Discontinuance of Proceedings.............................................................. 44
Section 4.04. Right of Certificateholders to Receive Payments Not to Be Impaired......................... 44
ARTICLE V
DUTIES OF THE SUBORDINATION AGENT;
AGREEMENTS OF TRUSTEES, ETC.
Section 5.01. Notice of Indenture Event of Default or Triggering Event................................... 44
Section 5.02. Indemnification............................................................................ 44
Section 5.03. No Duties Except as Specified in Intercreditor Agreement................................... 45
3
Section 5.04. Notice from the Liquidity Providers and Trustees........................................... 45
ARTICLE VI
THE SUBORDINATION AGENT
Section 6.01. Authorization; Acceptance of Trusts and Duties............................................. 45
Section 6.02. Absence of Duties.......................................................................... 45
Section 6.03. No Representations or Warranties as to Documents........................................... 45
Section 6.04. No Segregation of Monies; No Interest...................................................... 46
Section 6.05. Reliance; Agents; Advice of Counsel........................................................ 46
Section 6.06. Capacity in Which Acting................................................................... 46
Section 6.07. Compensation............................................................................... 46
Section 6.08. May Become Certificateholder............................................................... 47
Section 6.09. Subordination Agent Required; Eligibility.................................................. 47
Section 6.10. Money to Be Held in Trust.................................................................. 47
ARTICLE VII
SUCCESSOR SUBORDINATION AGENT
Section 7.01. Replacement of Subordination Agent; Appointment of Successor............................... 47
ARTICLE VIII
SUPPLEMENTS AND AMENDMENTS
Section 8.01. Amendments, Waivers, Etc................................................................... 49
Section 8.02. Subordination Agent Protected.............................................................. 51
Section 8.03. Effect of Supplemental Agreements.......................................................... 51
Section 8.04. Notice to Rating Agencies.................................................................. 51
ARTICLE IX
MISCELLANEOUS
Section 9.01. Termination of Intercreditor Agreement..................................................... 51
Section 9.02. Intercreditor Agreement for Benefit of Trustees, Liquidity Providers and
Subordination Agent........................................................................ 51
Section 9.03. Notices.................................................................................... 51
Section 9.04. Severability............................................................................... 53
Section 9.05. No Oral Modifications or Continuing Waivers................................................ 53
Section 9.06. Successors and Assigns..................................................................... 53
Section 9.07. Headings................................................................................... 53
Section 9.08. Counterparts............................................................................... 53
Section 9.09. Subordination.............................................................................. 53
Section 9.10. Governing Law.............................................................................. 55
Section 9.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity....................... 55
ii
4
INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT, dated as of November 16, 2000,
is made by and among STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, a national banking association (in its individual
capacity, together with its successors and permitted assigns, "State Street"),
not in its individual capacity but solely as trustee of each Trust (such term
and other capitalized terms used herein without definition being defined as
provided in Article I); WESTDEUTSCHE LANDESBANK GIROZENTRALE, a German banking
institution organized under the laws of the State of North Rhine-Westphalia,
acting through its New York Branch ("WestLB"), as Class A-1 Liquidity Provider,
Class A-2 Liquidity Provider, Class B Liquidity Provider and Class C Liquidity
Provider, and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its individual capacity except as expressly set forth
herein, but solely as Subordination Agent and trustee hereunder (in such
capacity, together with any successor appointed pursuant to Article VII, the
"Subordination Agent").
WHEREAS, pursuant to each Indenture with respect to an
Aircraft, Delta will issue on a recourse basis four (or five, under certain
circumstances) series of Equipment Notes secured by such Aircraft;
WHEREAS, pursuant to the Participation Agreements, each Trust
will acquire those Equipment Notes having an interest rate identical to the
interest rate applicable to the Certificates to be issued by such Trust;
WHEREAS, pursuant to each Trust Agreement, the Trust created
thereby proposes to issue a single class of Certificates (a "Class") bearing the
interest rate and having the final distribution date described in such Trust
Agreement on the terms and subject to the conditions set forth therein;
WHEREAS, pursuant to the Underwriting Agreement, the
Underwriters propose to purchase the Certificates issued by each Trust in the
aggregate face amount set forth opposite the name of such Trust on Schedule I
thereto on the terms and subject to the conditions set forth therein;
WHEREAS, the Liquidity Provider proposes to enter into four
separate revolving credit agreements with the Subordination Agent, as agent and
trustee for the Trustee of each of the Class A-1 Trust, the Class A-2 Trust, the
Class B Trust and the Class C Trust, respectively, for the benefit of the
Certificateholders of such Trust; and
WHEREAS, it is a condition precedent to the obligations of the
Underwriters under the Underwriting Agreement that the Subordination Agent, the
Trustees and the Liquidity Provider agree to the terms of subordination set
forth in this Agreement in respect of each Class of Certificates, and the
Subordination Agent, the Trustees and the Liquidity Provider, by entering into
this Agreement, hereby acknowledge and agree to such terms of subordination and
the other provisions of this Agreement;
5
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, and of other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. (a) The definitions stated
herein apply equally to the singular and the plural forms of the terms defined.
(b) All references in this Agreement to designated "Articles",
"Sections" and other subdivisions are to the designated Articles, Sections and
other subdivisions of this Agreement.
(c) The words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.
(d) Unless the context otherwise requires, whenever the words
"including", "include" or "includes" are used herein, it shall be deemed to be
followed by the phrase "without limitation".
(e) For purposes of this Agreement, unless the context otherwise
requires, the following capitalized terms shall have the following meanings:
"ACCELERATION" means, with respect to the amounts payable in
respect of the Equipment Notes issued under any Indenture, such amounts becoming
immediately due and payable by declaration or otherwise. "Accelerate",
"Accelerated" and "Accelerating" have meanings correlative to the foregoing.
"ADJUSTED EXPECTED DISTRIBUTIONS" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest in respect of such Certificates and (y) the greater
of:
(A) the difference between (x) the Pool Balance of such
Certificates as of the immediately preceding Distribution Date (or, if
the Current Distribution Date is the first Distribution Date, the
original aggregate face amount of the Certificates of such Trust) and
(y) the Pool Balance of such Certificates as of the Current
Distribution Date calculated on the basis that (i) the principal of
the Non-Performing Equipment Notes held in such Trust has been paid in
full and such payments have been distributed to the holders of such
Certificates, (ii) the principal of the Performing Equipment Notes
held in such Trust has been paid when due (but without giving effect
to any Acceleration of Performing Equipment Notes) and such payments
have been distributed to the holders of such Certificates and (iii)
the principal of any Equipment Notes formerly held in such Trust that
have been sold pursuant to the terms hereof has been paid in full and
such payments have been distributed to the holders of such
Certificates, and
(B) the amount of the excess, if any, of (i) the Pool
Balance of such Class of Certificates as of the immediately preceding
Distribution Date (or, if the Current
2
6
Distribution Date is the first Distribution Date, the original
aggregate face amount of the Certificates of such Trust), over (ii)
the Aggregate LTV Collateral Amount for such Class of Certificates for
the Current Distribution Date;
provided that, until the date of the initial LTV Appraisals for all the
Aircraft, clause (B) shall not apply.
For purposes of calculating Adjusted Expected Distributions
with respect to the Certificates of any Trust, any premium paid on the Equipment
Notes held in such Trust that has not been distributed to the Certificateholders
of such Trust (other than such premium or a portion thereof applied to the
distribution of interest on the Certificates of such Trust or the reduction of
the Pool Balance of such Trust) shall be added to the amount of Adjusted
Expected Distributions.
"ADVANCE" means, with respect to any Liquidity Facility, any
Advance as defined in such Liquidity Facility.
"AFFILIATE" means, with respect to any Person, any other
Person directly or indirectly controlling, 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,
directly or indirectly, to direct the management and policies of such Person,
whether through the ownership of voting securities or by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGGREGATE LTV COLLATERAL AMOUNT" for any Class of
Certificates for any Distribution Date means an amount, not less than zero,
equal to the product of (i) the sum of the applicable LTV Collateral Amounts for
such Class of Certificates for all Aircraft, minus the Pool Balance for each
Class of Certificates, if any, senior to such Class, after giving effect to any
distribution of principal on such Distribution Date with respect to such senior
Class or Classes multiplied by (ii) (a) in the case of the Class A-1
Certificates or Class A-2 Certificates, a fraction the numerator of which equals
the Pool Balance for the Class A-1 Certificates or the Class A-2 Certificates,
as the case may be, and the denominator of which equals the aggregate Pool
Balance for the Class A-1 Certificates and the Class A-2 Certificates, in each
case prior to giving effect to any distribution of principal on such
Distribution Date with respect to either such Class of Certificates, and (b) in
the case of the Class B Certificates and the Class C Certificates, 1.0.
"AIRCRAFT" means, with respect to each Indenture, the
"Aircraft" referred to therein.
"APPRAISAL" means a current fair market value appraisal (which
may be a "desktop" appraisal) performed by any Appraiser or any other nationally
recognized appraiser on the basis of an arm's-length transaction between an
informed and willing purchaser under no compulsion to buy and an informed and
willing seller under no compulsion to sell and both having knowledge of all
relevant facts.
"APPRAISED CURRENT MARKET VALUE" of any Aircraft means the
lower of the average and the median of the three most recent LTV Appraisals of
such Aircraft.
3
7
"APPRAISERS" means Aircraft Information Systems, Inc.,
Avitas, Inc. and Xxxxxx Xxxxx & Xxxxx, Inc.
"AVAILABLE AMOUNT" means, with respect to any Liquidity
Facility on any drawing date, subject to the proviso contained in the first
sentence of Section 3.06(g), an amount equal to (a) the Stated Amount of such
Liquidity Facility at such time, less (b) the aggregate amount of each Interest
Drawing honored by the Liquidity Provider under such Liquidity Facility on or
prior to such date that has not been reimbursed or reinstated as of such date;
provided that, following a Downgrade Drawing, a Non-Extension Drawing or a Final
Drawing under such Liquidity Facility, the Available Amount of such Liquidity
Facility shall be zero.
"BASIC AGREEMENT" means that certain Pass Through Trust
Agreement, dated as of the Closing Date, between Delta and State Street, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms, but does not include any Trust Supplement.
"BUSINESS DAY" means, with respect to the Certificates of any
Class, any day other than a Saturday, a Sunday or a day on which commercial
banks are required or authorized to close in New York, New York, Atlanta,
Georgia, or, so long as any Certificate of such Class is outstanding, the city
and state in which the Trustee, the Subordination Agent or any related Loan
Trustee maintains its Corporate Trust Office or receives and disburses funds,
and that, solely with respect to draws under any Liquidity Facility, also is a
"Business Day" as defined in such Liquidity Facility.
"CASH COLLATERAL ACCOUNT" means the Class A-1 Cash Collateral
Account, the Class A-2 Cash Collateral Account, the Class B Cash Collateral
Account or the Class C Cash Collateral Account, as applicable.
"CERTIFICATE" means a Class A-1 Certificate, a Class A-2
Certificate, a Class B Certificate or a Class C Certificate, as applicable.
"CERTIFICATEHOLDER" means, with respect to any Class of
Certificates, the Person in whose name a Certificate is registered in the
Register for the Certificates of such Class.
"CITIZEN OF THE UNITED STATES" has the meaning specified for
such term in Section 40102(a)(15) of Title 49 of the United States Code or any
similar legislation of the United States enacted in substitution or replacement
therefor.
"CLASS" has the meaning specified in the recitals to this
Agreement.
"CLASS A-1 CASH COLLATERAL ACCOUNT" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it so qualifies, into
which amounts shall be deposited as referred to in Section 3.06(f).
"CLASS A-1 CERTIFICATEHOLDER" means, at any time, any
Certificateholder of one or more Class A-1 Certificates.
4
8
"CLASS A-1 CERTIFICATES" means the certificates issued by the
Class A-1 Trust, substantially in the form of Exhibit A to the Class A-1 Trust
Agreement, and authenticated by the Class A-1 Trustee, representing Fractional
Undivided Interests in the Class A-1 Trust, and any certificates issued in
exchange therefor or replacement thereof pursuant to the terms of the Class A-1
Trust Agreement.
"CLASS A-1 LIQUIDITY FACILITY" means, initially, the Revolving
Credit Agreement, dated as of the date hereof, between the Subordination Agent,
as agent and trustee for the Class A-1 Trustee, and WestLB and, from and after
the replacement of such agreement pursuant hereto, the Replacement Liquidity
Facility therefor, if any, in each case as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"CLASS A-1 LIQUIDITY PROVIDER" means WestLB, together with any
Replacement Liquidity Provider that has issued a Replacement Liquidity Facility
to replace the Class A-1 Liquidity Facility pursuant to Section 3.06(c) or
3.06(e).
"CLASS A-1 TRUST" means the Delta Air Lines Pass Through Trust
2000-1A-1 created and administered pursuant to the Class A-1 Trust Agreement.
"CLASS A-1 TRUST AGREEMENT" means the Basic Agreement, as
supplemented by Trust Supplement No. 2000-1A-1 thereto, dated as of the date
hereof, governing the creation and administration of the Delta Air Lines Pass
Through Trust 2000-1A-1 and the issuance of the Class A-1 Certificates, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
"CLASS A-1 TRUSTEE" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except as
expressly set forth in the Class A-1 Trust Agreement, but solely as trustee
under the Class A-1 Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"CLASS A-2 CASH COLLATERAL ACCOUNT" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it so qualifies, into
which amounts shall be deposited as referred to in Section 3.06(f).
"CLASS A-2 CERTIFICATEHOLDER" means, at any time, any
Certificateholder of one or more Class A-2 Certificates.
"CLASS A-2 CERTIFICATES" means the certificates issued by the
Class A-2 Trust, substantially in the form of Exhibit A to the Class A-2 Trust
Agreement, and authenticated by the Class A-2 Trustee, representing Fractional
Undivided Interests in the Class A-2 Trust, and any certificates issued in
exchange therefor or replacement thereof pursuant to the terms of the Class A-2
Trust Agreement.
"CLASS A-2 LIQUIDITY FACILITY" means, initially, the Revolving
Credit Agreement, dated as of the date hereof, between the Subordination Agent,
as agent and trustee for the Class A-2 Trustee, and WestLB and, from and after
the replacement of such agreement pursuant
5
9
hereto, the Replacement Liquidity Facility therefor, if any, in each case as
amended, supplemented or otherwise modified from time to time in accordance
with its terms.
"CLASS A-2 LIQUIDITY PROVIDER" means WestLB, together with any
Replacement Liquidity Provider that has issued a Replacement Liquidity Facility
to replace the Class A-2 Liquidity Facility pursuant to Section 3.06(c) or
3.06(e).
"CLASS A-2 TRUST" means the Delta Air Lines Pass Through Trust
2000-1A-2 created and administered pursuant to the Class A-2 Trust Agreement.
"CLASS A-2 TRUST AGREEMENT" means the Basic Agreement, as
supplemented by Trust Supplement No. 2000-1A-2 thereto, dated as of the date
hereof, governing the creation and administration of the Delta Air Lines Pass
Through Trust 2000-1A-2 and the issuance of the Class A-2 Certificates, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
"CLASS A-2 TRUSTEE" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except as
expressly set forth in the Class A-2 Trust Agreement, but solely as trustee
under the Class A-2 Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"CLASS B CASH COLLATERAL ACCOUNT" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it so qualifies, into
which amounts shall be deposited as referred to in Section 3.06(f).
"CLASS B CERTIFICATEHOLDER" means, at any time, any
Certificateholder of one or more Class B Certificates.
"CLASS B CERTIFICATES" means the certificates issued by the
Class B Trust, substantially in the form of Exhibit A to the Class B Trust
Agreement, and authenticated by the Class B Trustee, representing Fractional
Undivided Interests in the Class B Trust, and any certificates issued in
exchange therefor or replacement thereof pursuant to the terms of the Class B
Trust Agreement.
"CLASS B LIQUIDITY FACILITY" means, initially, the Revolving
Credit Agreement, dated as of the date hereof, between the Subordination Agent,
as agent and trustee for the Class B Trustee, and WestLB, and, from and after
the replacement of such agreement pursuant hereto, the Replacement Liquidity
Facility therefor, if any, in each case as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"CLASS B LIQUIDITY PROVIDER" means WestLB, together with any
Replacement Liquidity Provider that has issued a Replacement Liquidity Facility
to replace the Class B Liquidity Facility pursuant to Section 3.06(c) or
3.06(e).
"CLASS B TRUST" means the Delta Air Lines Pass Through Trust
2000-1B created and administered pursuant to the Class B Trust Agreement.
6
10
"CLASS B TRUST AGREEMENT" means the Basic Agreement, as
supplemented by Trust Supplement No. 2000-1B thereto, dated as of the date
hereof, governing the creation and administration of the Delta Air Lines Pass
Through Trust 2000-1B and the issuance of the Class B Certificates, as the same
may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
"CLASS B TRUSTEE" means State Street Bank and Trust Company of
Connecticut, National Association, not in its individual capacity except as
expressly set forth in the Class B Trust Agreement, but solely as trustee under
the Class B Trust Agreement, together with any successor trustee appointed
pursuant thereto.
"CLASS C CASH COLLATERAL ACCOUNT" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it so qualifies, into
which amounts shall be deposited as referred to in Section 3.06(f).
"CLASS C CERTIFICATEHOLDER" means, at any time, any
Certificateholder of one or more Class C Certificates.
"CLASS C CERTIFICATES" means the certificates issued by the
Class C Trust, substantially in the form of Exhibit A to the Class C Trust
Agreement, and authenticated by the Class C Trustee, representing Fractional
Undivided Interests in the Class C Trust, and any certificates issued in
exchange therefor or replacement thereof pursuant to the terms of the Class C
Trust Agreement.
"CLASS C LIQUIDITY FACILITY" means, initially, the Revolving
Credit Agreement, dated as of the date hereof, between the Subordination Agent,
as agent and trustee for the Class C Trustee, and WestLB, and, from and after
the replacement of such agreement pursuant hereto, the Replacement Liquidity
Facility therefor, if any, in each case as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"CLASS C LIQUIDITY PROVIDER" means WestLB, together with any
Replacement Liquidity Provider that has issued a Replacement Liquidity Facility
to replace the Class C Liquidity Facility pursuant to Section 3.06(c) or
3.06(e).
"CLASS C TRUST" means the Delta Air Lines Pass Through Trust
2000-1C created and administered pursuant to the Class C Trust Agreement.
"CLASS C TRUST AGREEMENT" means the Basic Agreement, as
supplemented by Trust Supplement No. 2000-1C thereto, dated as of the date
hereof, governing the creation and administration of the Delta Air Lines Pass
Through Trust 2000-1C and the issuance of the Class C Certificates, as the same
may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.
"CLASS C TRUSTEE" means State Street Bank and Trust Company of
Connecticut, National Association, not in its individual capacity except as
expressly set forth in the Class C Trust Agreement, but solely as trustee under
the Class C Trust Agreement, together with any successor trustee appointed
pursuant thereto.
7
11
"CLASS D CERTIFICATEHOLDER" means, at any time, any
Certificateholder of one or more Class D Certificates, if and when issued.
"CLASS D CERTIFICATES" means any Certificates issued by the
Class D Trust, if and when created, representing Fractional Undivided Interests
in the Class D Trust.
"CLASS D TRUST" means the Delta Air Lines Pass Through Trust
2000-1D, if and when created, administered pursuant to the Basic Agreement and a
Trust Supplement.
"CLASS D TRUSTEE" means the trustee of the Class D Trust, if
and when created.
"CLOSING DATE" means November 16, 2000.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder.
"COLLATERAL" means, with respect to any Indenture, the
"Collateral" referred to therein.
"COLLECTION ACCOUNT" means the Eligible Deposit Account
established by the Subordination Agent pursuant to Section 2.02(a) in and from
which the Subordination Agent shall make deposits and withdrawals in accordance
with this Agreement.
"CONSENT NOTICE" has the meaning specified in Section 3.06(d).
"CONSENT PERIOD" has the meaning specified in Section 3.06(d).
"CONTROLLING PARTY" means the Person entitled to act as such
pursuant to the terms of Section 2.06.
"CORPORATE TRUST OFFICE" means, with respect to any Trustee,
the Subordination Agent or any Loan Trustee, the office of such Person in the
city at which, at any particular time, its corporate trust business shall be
principally administered.
"CURRENT DISTRIBUTION DATE" means a Distribution Date
specified as a reference date for calculating the Expected Distributions or the
Adjusted Expected Distributions with respect to the Certificates of any Trust as
of such Distribution Date.
"DELTA" means Delta Air Lines, Inc., a Delaware corporation,
and its successors and permitted assigns.
"DELTA BANKRUPTCY EVENT" means the occurrence and continuation
of any of the following:
(a) Delta consents to the appointment of or the taking of
possession by a receiver, trustee or liquidator of itself or of a
substantial part of its property, admits in writing its inability to
pay its debts generally as they come due or makes a general assignment
for the benefit of creditors;
8
12
(b) Delta files a voluntary petition in bankruptcy or a
voluntary petition or an answer seeking reorganization, liquidation or
other relief as a debtor in a case under any bankruptcy laws or
insolvency laws (as in effect at such time) or an answer admitting the
material allegations of a petition filed against Delta as a debtor in
any such case, or Delta seeks relief as a debtor by voluntary
petition, answer or consent, under the provisions of any other
bankruptcy or other similar law providing for the reorganization or
winding-up of corporations (as in effect at such time), or Delta seeks
an agreement, composition, extension or adjustment with its creditors
under such laws; or
(c) an order, judgment or decree is entered by any court
of competent jurisdiction appointing, without the consent of Delta , a
receiver, trustee or liquidator of Delta or sequestering any
substantial part of its property, or granting any other relief in
respect of Delta as a debtor under any bankruptcy laws or insolvency
laws (as in effect at such time), and any such order, judgment or
decree of appointment or sequestration remains in force undismissed,
unstayed and unvacated for a period of 90 days after the date of entry
thereof; or
(d) a petition against Delta as a debtor in a case under
the federal bankruptcy laws or other insolvency laws (as in effect at
such time) is filed and not withdrawn or dismissed within 90 days
thereafter, or if, under the provisions of any law providing for
reorganization or winding-up of corporations that applies to Delta ,
any court of competent jurisdiction assumes jurisdiction, custody or
control of Delta or of any substantial part of its property and such
jurisdiction, custody or control remains in force unrelinquished,
unstayed and unterminated for a period of 90 days.
"DELTA PROVISIONS" has the meaning specified in Section
8.01(a).
"DESIGNATED REPRESENTATIVES" means the Subordination Agent
Representatives, the Trustee Representatives and the LP Representatives
identified under Section 2.05.
"DISTRIBUTION DATE" means a Regular Distribution Date or a
Special Distribution Date.
"DOLLARS" means the lawful currency of the United States.
"DOWNGRADE DRAWING" has the meaning specified in Section
3.06(c).
"DOWNGRADED FACILITY" has the meaning specified in Section
3.06(c).
"DRAWING" means an Interest Drawing, a Final Drawing, a
Non-Extension Drawing or a Downgrade Drawing, as the case may be.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the United States or any one of the states thereof or the District of
Columbia (or any United States branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as any
of the securities of such depository institution has a long-term unsecured debt
rating of at least
9
13
A3 or its equivalent by Moody's or at least A- or its equivalent by S&P. An
Eligible Deposit Account may be maintained with a Liquidity Provider so long as
such Liquidity Provider is an Eligible Institution; provided that such
Liquidity Provider shall have waived all rights of set-off and counterclaim
with respect to such account.
"ELIGIBLE INSTITUTION" means (a) the corporate trust
department of the Subordination Agent or any Trustee, as applicable, or (b) a
depository institution organized under the laws of the United States of America
or any state thereof or the District of Columbia (or any U.S. branch of a
foreign bank), which has a long-term unsecured debt rating of at least A3 or its
equivalent by Moody's or at least A- or its equivalent by S&P.
"ELIGIBLE INVESTMENTS" means investments in (a) obligations of
the United States government or agencies thereof, or obligations guaranteed by
the United States government, (b) open market commercial paper of any
corporation incorporated under the laws of the United States or any state
thereof rated at least P-1 or its equivalent by Moody's or at least A-1 or its
equivalent by S&P, (c) certificates of deposit issued by commercial banks
organized under the laws of the United States or of any political subdivision
thereof (or any United States branch of a foreign bank) 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 Moody's or A or its equivalent
by S&P, provided, however, that the aggregate amount at any one time invested in
certificates of deposit issued by any one bank shall not be in excess of 5% of
such bank's capital and surplus, (d) Dollar denominated offshore certificates of
deposit issued by, or offshore time deposits with, any commercial bank described
in (c) or any subsidiary thereof, and (e) 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 (a) through (d) as
collateral. If none of the above investments is available, the entire amounts to
be invested may be used to purchase Federal funds from an entity described in
clause (c). All Eligible Investments must be held in an Eligible Deposit
Account. Any of the investments described herein may be made through or with, as
applicable, the bank acting as Trustee or its Affiliates.
"EQUIPMENT NOTES" means, at any time, the Series A-1 Equipment
Notes, the Series A-2 Equipment Notes, the Series B Equipment Notes and the
Series C Equipment Notes, collectively, and in each case, any Equipment Notes
issued in exchange therefor or replacement thereof pursuant to the terms of the
Indentures.
"EXPECTED DISTRIBUTIONS" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest in respect of such Certificates and (y) the
difference between (A) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (or, if the Current Distribution Date is
the first Distribution Date, the original aggregate face amount of the
Certificates of such Trust) and (B) the Pool Balance of such Certificates as of
the Current Distribution Date calculated on the basis that (i) the principal of
the Equipment Notes held in such Trust has been paid when due (whether at stated
maturity or upon redemption, prepayment, purchase or Acceleration or otherwise)
and such payments have been distributed to the holders of such Certificates and
(ii) the principal of any Equipment Notes formerly held in such Trust that have
been sold pursuant to the terms hereof has been paid in full and such payments
have been distributed to the holders of such Certificates.
10
14
For purposes of calculating Expected Distributions with
respect to the Certificates of any Trust, any premium paid on the Equipment
Notes held in such Trust which has not been distributed to the
Certificateholders of such Trust (other than such premium or a portion thereof
applied to distributions of interest on the Certificates of such Trust or the
reduction of the Pool Balance of such Trust) shall be added to the amount of
such Expected Distributions.
"EXPIRY DATE" with respect to any Liquidity Facility, has the
meaning specified in such Liquidity Facility.
"FEE LETTER" means the Fee Letter among WestLB, the
Subordination Agent and Delta with respect to the Liquidity Facilities and any
fee letter entered into among the Subordination Agent, Delta and any Replacement
Liquidity Provider.
"FINAL DISTRIBUTIONS" means, with respect to the Certificates
of any Trust on any Distribution Date, the sum of (x) the aggregate amount of
all accrued and unpaid interest in respect of such Certificates and (y) the Pool
Balance of such Certificates as of the immediately preceding Distribution Date.
For purposes of calculating Final Distributions with respect to the Certificates
of any Trust, any premium paid on the Equipment Notes held in such Trust which
has not been distributed to the Certificateholders of such Trust (other than
such premium or a portion thereof applied to distributions of interest on the
Certificates of such Trust or the reduction of the Pool Balance of such Trust)
shall be added to the amount of such Final Distributions.
"FINAL DRAWING" has the meaning specified in Section 3.06(i).
"FINAL LEGAL DISTRIBUTION DATE" means (i) with respect to the
Class X-0 Xxxxxxxxxxxx, Xxxxxxxx 00, 0000, (xx) with respect to the Class A-2
Certificates, May 18, 2012, (iii) with respect to the Class B Certificates, May
18, 2012 and (iv) with respect to the Class C Certificates, May 18, 2007.
"FRACTIONAL UNDIVIDED INTEREST" means the fractional undivided
interest in a Trust that is represented by a Certificate relating to such Trust.
"INDENTURE" means each of the Indenture and Security
Agreements entered into by the Loan Trustee and Delta pursuant to the
Participation Agreements, in each case as the same may be amended, supplemented
or otherwise modified from time to time in accordance with its terms.
"INDENTURE EVENT OF DEFAULT" means, with respect to any
Indenture, any Event of Default (as such term is defined in such Indenture)
thereunder.
"INTEREST DRAWING" has the meaning specified in Section
3.06(a).
"INTEREST PAYMENT DATE" means, with respect to any Liquidity
Facility, each date on which interest is due and payable under Section 3.07(c),
(d) or (e) of such Liquidity Facility on a Downgrade Drawing, Non-Extension
Drawing or Final Drawing thereunder.
11
15
"INVESTMENT EARNINGS" means investment earnings on funds on
deposit in the Trust Accounts net of losses and the Subordination Agent's
reasonable expenses in making such investments.
"LENDING OFFICE" has the meaning, with respect to any
Liquidity Facility, ascribed to such term in such Liquidity Facility.
"LIEN" means any mortgage, pledge, lien, charge, claim,
encumbrance, lease, sublease or security interest of any kind.
"LIQUIDITY EVENT OF DEFAULT", with respect to any Liquidity
Facility, has the meaning specified in such Liquidity Facility.
"LIQUIDITY EXPENSES" means all Liquidity Obligations other
than (i) the principal amount of any Drawings under the Liquidity Facilities and
(ii) any interest accrued on any Liquidity Obligations.
"LIQUIDITY FACILITY" means, at any time, the Class A-1
Liquidity Facility, the Class A-2 Liquidity Facility, the Class B Liquidity
Facility or the Class C Liquidity Facility, as applicable.
"LIQUIDITY OBLIGATIONS" means all principal, interest, fees
and other amounts owing to the Liquidity Providers under the Liquidity
Facilities, Section 4.02 of the Participation Agreements or the Fee Letter.
"LIQUIDITY PROVIDER" means, at any time, the Class A-1
Liquidity Provider, the Class A-2 Liquidity Provider, the Class B Liquidity
Provider or the Class C Liquidity Provider, as applicable.
"LOAN TRUSTEE" means, with respect to any Indenture, the bank,
trust company or other financial institution designated as loan trustee
thereunder, and any successor to such loan trustee.
"LP INCUMBENCY CERTIFICATE" has the meaning specified in
Section 2.05(c).
"LP REPRESENTATIVES" has the meaning specified in Section
2.05(c).
"LTV APPRAISALS" has the meaning specified in Section 4.01(a).
"LTV COLLATERAL AMOUNT" of any Aircraft for any Class of
Certificates means, as of any Distribution Date, the lesser of (i)(x) with
respect to any Aircraft other than an Aircraft referred to in the following
clauses (y) and (z), the LTV Ratio for such Class of Certificates multiplied by
the Appraised Current Market Value of such Aircraft or (y) with respect to any
such Aircraft that has suffered an Event of Loss under and as defined in the
relevant Indenture, the amount of the insurance proceeds paid to the related
Loan Trustee in respect thereof to the extent then held by such Loan Trustee
(and/or on deposit in the Special Payments Account) or payable to such Loan
Trustee in respect thereof or (z) with respect to any such Aircraft that has
been released from the applicable Indenture pursuant to the provisions of
Section 10.01(b)
12
16
thereof, the amount of money and U.S. Government Obligations deposited with the
Loan Trustee pursuant thereto as of such Distribution Date and (ii) the
outstanding principal amount of the Equipment Notes secured by such Aircraft
after giving effect to any principal payments of such Equipment Notes on or
before such Distribution Date.
"LTV RATIO" means (i) for the Class A-1 Certificates, 47.0%,
(ii) for the Class A-2 Certificates, 47.0%, (iii) for the Class B Certificates,
56.5%, and (iv) for the Class C Certificates, 69.0%.
"MINIMUM SALE PRICE" means, with respect to any Aircraft or
the Equipment Notes issued in respect of such Aircraft, at any time, the lesser
of (a) 75% of the Appraised Current Market Value of such Aircraft and (b) the
aggregate outstanding principal amount of such Equipment Notes, plus accrued and
unpaid interest thereon.
"MOODY'S" means Xxxxx'x Investors Service, Inc.
"NON-CONTROLLING PARTY" means, at any time, any Trustee or
Liquidity Provider which is not the Controlling Party at such time.
"NON-EXTENDED FACILITY" has the meaning specified in Section
3.06(d).
"NON-EXTENSION DRAWING" has the meaning specified in Section
3.06(d).
"NON-PERFORMING EQUIPMENT NOTE" means an Equipment Note issued
pursuant to an Indenture that is not a Performing Equipment Note.
"OFFICER'S CERTIFICATE" of any Person means a certification
signed by a Responsible Officer of such Person.
"OPERATIVE AGREEMENTS" means this Agreement, the Liquidity
Facilities, the Fee Letter, the Indentures, the Trust Agreements, the
Participation Agreements, the Equipment Notes and the Certificates, together
with all exhibits and schedules included with any of the foregoing.
"OUTSTANDING" means, when used with respect to each Class of
Certificates, as of the date of determination, all Certificates of such Class
theretofore authenticated and delivered under the related Trust Agreement,
except:
(i) Certificates of such Class theretofore canceled by
the Registrar (as defined in such Trust Agreement) or delivered to the
Trustee thereunder or such Registrar for cancellation;
(ii) all of the Certificates of such Class if money in the
full amount required to make the final distribution with respect to
such Class pursuant to Section 11.01 of such Trust Agreement has been
theretofore deposited with the related Trustee in trust for the
Certificateholders of such Certificates as provided in Section 4.01 of
such Trust Agreement, pending distribution of such money to such
Certificateholders pursuant to payment of such final distribution
payment; and
13
17
(iii) Certificates of such Class in exchange for or in lieu
of which other Certificates of such Class have been authenticated and
delivered pursuant to such Trust Agreement;
provided, however, that in determining whether the holders of the requisite
Fractional Undivided Interest of such Certificates have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, any
Certificates owned by Delta or any of its Affiliates shall be disregarded and
deemed not to be Outstanding. In determining whether such Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Certificates that such Trustee knows to be so
owned shall be so disregarded Notwithstanding the foregoing, (x) if Delta and
its Affiliates own 100% of the Certificates of each Class, such Certificates
shall not be so disregarded and (y) if any amount of such Certificates owned by
Delta and its Affiliates have been pledged in good faith, such Certificates
shall not be disregarded if the pledgee establishes to the satisfaction of the
applicable Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not Delta or any of its Affiliates.
"OVERDUE SCHEDULED PAYMENT" means any Scheduled Payment which
is not in fact received by the Subordination Agent within five days after the
Scheduled Payment Date relating thereto.
"PARTICIPATION AGREEMENT" means, with respect to each
Indenture, the "Participation Agreement" referred to therein, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
its terms.
"PAYEES" has the meaning specified in Section 2.03(c).
"PERFORMING EQUIPMENT NOTE" means an Equipment Note issued
pursuant to an Indenture with respect to which no payment default has occurred
and is continuing (without giving effect to any Acceleration); provided, that in
the event of a bankruptcy proceeding in which Delta is a debtor under Title 11
of the United States Code (the "Bankruptcy Code"), (i) any payment default
existing during the 60-day period under Section 1110(a)(2)(A) of the Bankruptcy
Code (or such longer period as may apply under Section 1110(b) of the Bankruptcy
Code) (the "Section 1110 Period") shall not be taken into consideration, unless
during the Section 1110 Period the trustee in such proceeding or Delta refuses
to assume or agree to perform its obligations under the Indenture related to
such Equipment Note and (ii) any payment default occurring after the date of the
order for relief in such proceeding shall not be taken into consideration if
such payment default is cured under Section 1110(a)(2)(B) of the Bankruptcy Code
before the later of 30 days after the date of such default or the expiration of
the Section 1110 Period.
"PERFORMING NOTE DEFICIENCY" means any time that less than 65%
of the then aggregate outstanding principal amount of all Equipment Notes are
Performing Equipment Notes.
14
18
"PERSON" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
trustee, unincorporated organization or government or any agency or political
subdivision thereof.
"POOL BALANCE" means, with respect to the Certificates of any
Class, as of any date, (i) the original aggregate face amount of the
Certificates of such Class less (ii) the aggregate amount of all distributions
made in respect of such Certificates other than distributions made in respect of
interest or premium or reimbursement of any costs or expenses incurred in
connection therewith. The Pool Balance as of any Distribution Date with respect
to each Class shall be computed after giving effect to the payment of principal,
if any, on the Equipment Notes or other Trust Property held in the related Trust
and the distribution thereof to be made on such date.
"PROCEEDING" means any suit in equity, action at law or other
judicial or administrative proceeding.
"PTC EVENT OF DEFAULT" means, with respect to each Trust
Agreement, the failure to distribute within 10 Business Days after the
applicable Distribution Date: (i) the outstanding Pool Balance of the applicable
Class of Certificates on the Final Legal Distribution Date for such Class or
(ii) interest scheduled for distribution on such Certificates on any
Distribution Date (unless the Subordination Agent shall have made an Interest
Drawing, or a withdrawal from the Cash Collateral Account, with respect thereto
in an aggregate amount sufficient to pay such interest and shall have
distributed such amount to the Trustee entitled thereto).
"RATING AGENCIES" means, collectively, at any time, each of
two nationally recognized rating agencies that have been requested to rate the
Certificates and that are then rating the Certificates. The initial Rating
Agencies will be Moody's and S&P.
"RATINGS CONFIRMATION" means, with respect to any action
proposed to be taken, a written confirmation from each of the Rating Agencies
that such action would not result in (i) a reduction of the rating for any Class
of Certificates below the then current rating for such Class of Certificates or
(ii) a withdrawal or suspension of the rating of any Class of Certificates.
"REGISTER", with respect to any Trust, has the meaning
ascribed to such term in the Trust Agreement for such Trust.
"REGULAR DISTRIBUTION DATES" means each May 18 and November
18, commencing on May 18, 2001; provided, however, that, if any such day shall
not be a Business Day, the related distribution shall be made on the next
succeeding Business Day without additional interest.
"REPLACEMENT LIQUIDITY FACILITY" means, for any Liquidity
Facility, an irrevocable revolving credit agreement (or agreements) in
substantially the form of the replaced Liquidity Facility, including
reinstatement provisions, or in such other form (which may include a letter of
credit, surety bond, financial insurance policy or guaranty) as shall permit the
Rating Agencies to confirm in writing their respective ratings then in effect
for the Certificates of the Class with respect to which such Liquidity Facility
was issued (before downgrading of such ratings, if any, as a result of the
downgrading, if any, of the applicable Liquidity Provider), in a
15
19
face amount (or in an aggregate face amount) equal to the applicable Required
Amount and issued by a Person (or Persons) having short-term unsecured debt
ratings issued by both Rating Agencies that are equal to or higher than the
Threshold Rating specified in clause (a) of the definition of Threshold Rating
or if such Person (or Persons) does not have a short-term unsecured debt rating
from a given Rating Agency, a long-term unsecured debt rating issued by such
Rating Agency that is equal to or higher than the Threshold Rating specified in
clause (b) of the definition of Threshold Rating. Without limitation of the
form that a Replacement Liquidity Facility otherwise may have pursuant to the
preceding sentence, a Replacement Liquidity Facility for any Class of
Certificates may have a stated expiration date earlier than 15 days after the
Final Legal Distribution Date of such Class of Certificates so long as such
Replacement Liquidity Facility provides for a Non-Extension Drawing as
contemplated by Section 3.06(d) hereof.
"REPLACEMENT LIQUIDITY PROVIDER" means a Person who issues a
Replacement Liquidity Facility.
"REQUIRED AMOUNT" means, with respect to each Liquidity
Facility, or the Cash Collateral Account, for any Class, for any day, the sum of
the aggregate amount of interest, calculated at the rate per annum equal to the
Stated Interest Rate for the related Class of Certificates on the basis of a
360-day year comprised of twelve 30-day months, that would be distributable on
such Class of Certificates on each of the three successive Regular Distribution
Dates immediately following such day or, if such day is a Regular Distribution
Date, on such day and the succeeding two Regular Distribution Dates, in each
case calculated on the basis of the Pool Balance of such Class of Certificates
on such date and without regard to expected future distributions of principal on
such Class of Certificates.
"RESPONSIBLE OFFICER" means (i) with respect to the
Subordination Agent and each of the Trustees, any officer in the Corporate Trust
Department or similar department of the Subordination Agent or such Trustee, as
the case may be, or any other officer customarily performing functions similar
to those performed by the persons who at the time shall be such officers or to
whom any corporate trust matter is referred because of his knowledge of and
familiarity with a particular subject, and (ii) with respect to each Liquidity
Provider, any authorized officer of such Liquidity Provider.
"SCHEDULED PAYMENT" means, with respect to any Equipment Note,
(i) any payment of principal or interest on such Equipment Note (other than an
Overdue Scheduled Payment) or (ii) any distribution in respect of interest on
such Equipment Note to the Certificateholders of Certificates of the
corresponding Class of Certificates with funds drawn under the Liquidity
Facility for such Class or withdrawn from the Cash Collateral Account for such
Class, which payment in the case of clause (i) or clause (ii) represents an
installment of principal on such Equipment Note at the stated maturity of such
installment, or the payment of regularly scheduled interest accrued on the
unpaid principal amount of such Equipment Note, or both; provided, however, 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.
16
20
"SCHEDULED PAYMENT DATE" means, with respect to any Scheduled
Payment, the date on which such Scheduled Payment is scheduled to be made.
"SERIES A-1 EQUIPMENT NOTES" means the Series A-1 Equipment
Notes issued pursuant to each Indenture by Delta and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.
"SERIES A-2 EQUIPMENT NOTES" means the Series A-2 Equipment
Notes issued pursuant to each Indenture by Delta and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.
"SERIES B EQUIPMENT NOTES" means the Series B Equipment Notes
issued pursuant to each Indenture by Delta and authenticated by the Loan Trustee
thereunder, and any such Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.
"SERIES C EQUIPMENT NOTES" means the Series C Equipment Notes
issued pursuant to each Indenture by Delta and authenticated by the Loan Trustee
thereunder, and any such Equipment Notes issued in exchange therefor or
replacement thereof pursuant to the terms of such Indenture.
"SERIES D EQUIPMENT NOTES" means the equipment notes, if any,
issued pursuant to any Indenture by Delta and authenticated by the Loan Trustee
thereunder, and designated "Series D Equipment Notes" thereunder, and any such
equipment notes issued in exchange therefor or replacement thereof pursuant to
the terms of such Indenture.
"SPECIAL DISTRIBUTION DATE" means, with respect to any Special
Payment, the Business Day chosen by the Subordination Agent pursuant to Section
2.04(a) for the distribution of such Special Payment in accordance with this
Agreement.
"SPECIAL PAYMENT" means any payment (other than a Scheduled
Payment or a distribution referred to in Section 2.03(c)) in respect of, or any
proceeds of, any Equipment Note or Collateral (as defined in each Indenture).
"SPECIAL PAYMENTS ACCOUNT" means the Eligible Deposit Account
created pursuant to Section 2.02(a) as a sub-account to the Collection Account.
"S&P" means Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc.
"STATE STREET" has the meaning specified in the introductory
paragraph to this Agreement.
"STATED AMOUNT" with respect to any Liquidity Facility, means
the Maximum Commitment (as defined in such Liquidity Facility) of the applicable
Liquidity Provider thereunder.
17
21
"STATED EXPIRATION DATE" has the meaning specified in Section
3.06(d).
"STATED INTEREST RATE" means (i) with respect to the Class A-1
Certificates, 7.379% per annum, (ii) with respect to the Class A-2 Certificates,
7.57% per annum, (iii), with respect to the Class B Certificates, 7.92% per
annum, and (iv) with respect to the Class C Certificates, 7.779% per annum.
"SUBORDINATION AGENT" has the meaning specified in the
introductory paragraph to this Agreement.
"SUBORDINATION AGENT INCUMBENCY CERTIFICATE" has the meaning
specified in Section 2.05(a).
"SUBORDINATION AGENT REPRESENTATIVES" has the meaning
specified in Section 2.05(a).
"TAX" and "TAXES" means all governmental fees (including,
without limitation, license, filing and registration fees) and all taxes
(including, without limitation, franchise, excise, stamp, value added, income,
gross receipts, sales, use and property taxes), withholdings, assessments,
levies, imposts, duties or charges, of any nature whatsoever, together with any
related penalties, fines, additions to tax or interest thereon imposed,
withheld, levied or assessed by any country, taxing authority or governmental
subdivision thereof or therein or by any international authority, including any
taxes imposed on any Person as a result of such Person being required to collect
and pay over withholding taxes.
"TERMINATION NOTICE" with respect to any Liquidity Facility
has the meaning specified in such Liquidity Facility.
"THRESHOLD RATING" means (a) with respect to the Class A-1
Liquidity Provider, the Class A-2 Liquidity Provider and the Class B Liquidity
Provider, a short-term unsecured debt rating of P-1 in the case of Moody's and
A-1+ in the case of S&P, and with respect to the Class C Liquidity Provider, a
short-term unsecured debt rating of P-1 in the case of Moody's and A-1 in the
case of S&P and (b) in the case of any Person who does not have a short-term
unsecured debt rating from either or both of such Rating Agencies, then in lieu
of such short-term unsecured debt rating from such Rating Agency or Rating
Agencies, with respect to the Class A-1 Liquidity Provider, the Class A-2
Liquidity Provider and the Class B Liquidity Provider, a long-term unsecured
debt rating of A1 in the case of Moody's and AA- in the case of S&P, and with
respect to the Class C Liquidity Provider, a long-term unsecured debt rating of
A1 in the case of Moody's and A in the case of S&P.
"TREASURY REGULATIONS" means regulations, including proposed
or temporary regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"TRIGGERING EVENT" means (x) the occurrence of an Indenture
Event of Default under all of the Indentures resulting in a PTC Event of Default
with respect to the most senior
18
22
Class of Certificates then Outstanding, (y) the Acceleration of all of the
outstanding Equipment Notes or (z) the occurrence of a Delta Bankruptcy Event.
"TRUST" means any of the Class A-1 Trust, the Class A-2 Trust,
the Class B Trust or the Class C Trust.
"TRUST ACCOUNTS" has the meaning specified in Section 2.02(a).
"TRUST AGREEMENT" means any of the Class A-1 Trust Agreement,
the Class A-2 Trust Agreement, the Class B Trust Agreement or the Class C Trust
Agreement.
"TRUST PROPERTY", with respect to any Trust, has the meaning
specified in the Trust Agreement for such Trust.
"TRUST SUPPLEMENT" means an agreement supplemental to the
Basic Agreement pursuant to which (i) a separate trust is created for the
benefit of the holders of Certificates of a series, (ii) the issuance of the
Certificates of a series representing fractional undivided interests in such
trust is authorized and (iii) the terms of the Certificates of such series are
established, as such agreement may from time to time be supplemented, amended or
otherwise modified.
"TRUSTEE" means any of the Class A-1 Trustee, the Class A-2
Trustee, the Class B Trustee or the Class C Trustee.
"TRUSTEE INCUMBENCY CERTIFICATE" has the meaning specified in
Section 2.05(b).
"TRUSTEE REPRESENTATIVES" has the meaning specified in Section
2.05(b).
"UNDERWRITERS" means the several underwriters listed as such
in the Underwriting Agreement.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement,
dated November 7, 2000, among the Underwriters and Delta, relating to the
purchase of the Certificates by the Underwriters, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"UNITED STATES" means the United States of America.
"WESTLB" has the meaning specified in the introductory
paragraph to this Agreement.
"WITHDRAWAL NOTICE" has the meaning specified in Section
3.06(d).
"WRITTEN NOTICE" means, from the Subordination Agent, any
Trustee or Liquidity Provider, a written instrument executed by the Designated
Representative of such Person. An invoice delivered by a Liquidity Provider
pursuant to Section 3.01 in accordance with its normal invoicing procedures
shall constitute Written Notice under such Section.
19
23
ARTICLE II
TRUST ACCOUNTS; CONTROLLING PARTY
Section 2.01. Agreement to Terms of Subordination;
Payments from Monies Received Only. (a) Each Trustee hereby acknowledges and
agrees to the terms of subordination set forth in this Agreement in respect of
each Class of Certificates and agrees to enforce such provisions and cause all
payments in respect of the Equipment Notes and the Liquidity Facilities to be
applied in accordance with the terms of this Agreement. In addition, each
Trustee hereby agrees to cause the Equipment Notes purchased by the related
Trust to be registered in the name of the Subordination Agent or its nominee,
as agent and trustee for such Trustee, to be held in trust by the Subordination
Agent solely for the purpose of facilitating the enforcement of the
subordination and other provisions of this Agreement.
(b) Except as otherwise expressly provided in the next
succeeding sentence of this Section 2.01(b), all payments to be made by the
Subordination Agent hereunder shall be made only from amounts received by it
that constitute Scheduled Payments, Special Payments and other payments under
the Operative Agreements, including payments under Section 4.02 of the
Participation Agreements and Section 2.14 of the Indentures, and only to the
extent that the Subordination Agent shall have received sufficient income or
proceeds therefrom to enable it to make such payments in accordance with the
terms hereof. Each of the Trustees and the Subordination Agent hereby agrees
and each Certificateholder, by its acceptance of a Certificate, and each
Liquidity Provider, by entering into the Liquidity Facility to which it is a
party, has agreed to look solely to such amounts to the extent available for
distribution to it as provided in this Agreement or the applicable Trust
Agreement, as the case may be, and that none of the Trustees, Loan Trustees or
the Subordination Agent is personally liable to any of them for any amounts
payable or any liability under this Agreement, any Trust Agreement, any
Liquidity Facility or such Certificate, except (in the case of the
Subordination Agent) as expressly provided herein or (in the case of the
Trustees) as expressly provided herein and in each Trust Agreement or (in the
case of the Loan Trustees) as expressly provided in any Operative Agreement.
Notwithstanding anything to the contrary in this Agreement and
in the other Operative Agreements, the Certificates do not represent
indebtedness of the related Trust, and references in this Agreement and the
Operative Agreements to accrued interest or principal amounts payable on the
Certificates of any Class are included only for computational purposes. For
purposes of such computations, the Certificates of any Class shall be deemed to
be comprised of interest and principal components, with the principal component
deemed to be the Pool Balance, and the interest component deemed to equal
interest accruing at the Stated Interest Rate for such Class of Certificates
from (i) the later of (1) the date of the issuance thereof and (2) the most
recent but preceding Distribution Date to which such interest was distributed to
(ii) the applicable date of determination, such interest to be considered
payable in arrears and to be calculated on the basis of a 360-day year comprised
of twelve 30-day months.
Section 2.02. Trust Accounts. (a) Upon the execution of
this Agreement, the Subordination Agent shall establish and maintain in its
name (i) the Collection Account as an Eligible Deposit Account, bearing a
designation clearly indicating that the funds deposited
20
24
therein are held in trust for the benefit of the Trustees, the
Certificateholders and the Liquidity Providers, and (ii) as a sub-account in
the Collection Account, the Special Payments Account as an Eligible Deposit
Account, bearing a designation clearly indicating that the funds deposited
therein are held in trust for the benefit of the Trustees, the
Certificateholders and the Liquidity Providers. The Subordination Agent shall
establish and maintain the Cash Collateral Accounts pursuant to and under the
circumstances set forth in Section 3.06(f). Upon such establishment and
maintenance under Section 3.06(f), the Cash Collateral Accounts shall, together
with the Collection Account, constitute the "Trust Accounts" hereunder.
(b) Funds on deposit in the Trust Accounts shall be
invested and reinvested by the Subordination Agent in Eligible Investments
selected by Delta or its designated representative if such investments are
reasonably available and have maturities no later than the earlier of (i) 90
days following the date of such investment and (ii) the Business Day
immediately preceding the Regular Distribution Date or the date of the related
distribution pursuant to Section 2.04, as the case may be, next following the
date of such investment; provided, however, that, following the making of a
Downgrade Drawing or a Non-Extension Drawing under any Liquidity Facility, the
Subordination Agent shall invest and reinvest the amounts in the applicable
Cash Collateral Account in Eligible Investments pursuant to the written
instructions of the Liquidity Provider funding such Drawing, and provided
further, however, that upon the occurrence and during the continuation of a
Triggering Event, the Subordination Agent shall invest and reinvest such
amounts (other than amounts in the Cash Collateral Accounts as a result of a
Downgrade Drawing or a Non-Extension Drawing, which shall be governed by the
foregoing proviso) in Eligible Investments in accordance with the written
instructions of the Controlling Party. Unless otherwise expressly provided in
this Agreement (including, without limitation, with respect to Investment
Earnings on amounts on deposit in the Cash Collateral Accounts, Section
3.06(f)), any Investment Earnings shall be deposited in the Collection Account
when received by the Subordination Agent and shall be applied by the
Subordination Agent in the same manner as the other amounts on deposit in the
Collection Account are to be applied. The Subordination Agent's reasonable fees
and expenses actually incurred in making such investments and any losses
incurred in such investments shall be charged against the principal amount
invested. The Subordination Agent shall not be liable for any loss resulting
from any investment, reinvestment or liquidation required to be made under this
Agreement other than by reason of its willful misconduct or negligence.
Eligible Investments and any other investment required to be made hereunder
shall be held to their maturities except that any such investment may be sold
(without regard to its maturity) by the Subordination Agent without
instructions whenever such sale is necessary to make a distribution required
under this Agreement. Uninvested funds held hereunder shall not earn or accrue
interest.
(c) The Subordination Agent shall possess all right,
title and interest in all funds on deposit from time to time in the Trust
Accounts and in all proceeds thereof (including all income thereon, except as
otherwise expressly provided herein with respect to Investment Earnings). The
Trust Accounts shall be held in trust by the Subordination Agent under the sole
dominion and control of the Subordination Agent for the benefit of the
Trustees, the Certificateholders and the Liquidity Providers, as the case may
be. If, at any time, any of the Trust Accounts ceases to be an Eligible Deposit
Account, the Subordination Agent shall within 10 Business Days (or such longer
period, not to exceed 30 calendar days, to which each Rating Agency may
consent) establish a new Collection Account, Special Payments Account or Cash
21
25
Collateral Account, as the case may be, as an Eligible Deposit Account and
shall transfer any cash and/or any investments to such new Collection Account,
Special Payments Account or Cash Collateral Account, as the case may be. So
long as the Subordination Agent is an Eligible Institution, the Trust Accounts
shall be maintained with it as Eligible Deposit Accounts.
Section 2.03. Deposits to the Collection Account and
Special Payments Account; Certain Distributions. (a) The Subordination Agent
shall, on each day when one or more Scheduled Payments are made to the
Subordination Agent as holder of the Equipment Notes, deposit in the Collection
Account the aggregate amount of such Scheduled Payments.
(b) The Subordination Agent shall, on each day when one
or more Special Payments are made to the Subordination Agent as holder of the
Equipment Notes, deposit in the Special Payments Account the aggregate amount
of such Special Payments.
(c) In the event that a Loan Trustee distributes to the
Subordination Agent pursuant to Section 3.04 or clause "first" of Section 3.03
of any Indenture any amounts payable under clauses (b), (c) or (d) of Section
2.14 of any Indenture, the Subordination Agent shall promptly deposit such
amounts in the Collection Account. The Subordination Agent will distribute
promptly upon receipt thereof (or in the case of any such payment, compensation
or reimbursement in respect of the Subordination Agent, will retain) (i) any
indemnity payment received by it from Delta in respect of any Trustee, the
Subordination Agent or any Liquidity Provider (collectively, the "Payees") and
(ii) any compensation or reimbursement received by it from Delta or the Loan
Trustee under any Operative Agreement in respect of any Payee (including,
without limitation, any fees payable to any Liquidity Provider under Section
2.03 of any Liquidity Facility or other amounts referred to in clauses (a), (c)
or (d) of Section 2.14 of any Indenture), in any such case directly to the
Payee entitled thereto, provided that if such Payee has previously received
from the Collection Account such payment, compensation or reimbursement, then
the Subordination Agent shall deposit such amount in the Collection Account.
Section 2.04. Distributions of Special Payments. (a)
Notice of Special Payment. Upon receipt by the Subordination Agent, as
registered holder of the Equipment Notes, of any notice of a Special Payment
(or, in the absence of any such notice, upon receipt by the Subordination Agent
of a Special Payment), the Subordination Agent shall promptly give notice
thereof to each Trustee and the Liquidity Providers. The Subordination Agent
shall promptly calculate the amount of the prepayment (including upon
Acceleration), redemption or purchase of Equipment Notes or the amount of any
Overdue Scheduled Payment, as the case may be, comprising such Special Payment
under the applicable Indenture or Indentures and shall promptly send to each
Trustee a Written Notice of such amount and the amount allocable to each Trust.
Such Written Notice shall also set the distribution date for such Special
Payment (a "Special Distribution Date"), which shall be the first Business Day
that follows the later to occur of (x) the 15th day after the date of such
Written Notice or (y) the date the Subordination Agent has received or expects
to receive such Special Payment. Amounts on deposit in the Special Payments
Account shall be distributed in accordance with Sections 2.04(b) and 2.04(c)
hereof, as applicable.
(b) Redemptions, Purchases and Prepayments of Equipment
Notes. (i) So long as no Triggering Event shall have occurred (whether or not
continuing), the Subordination
22
26
Agent shall make distributions pursuant to this Section 2.04(b) of amounts on
deposit in the Special Payments Account on account of the redemption, purchase
(including, without limitation, a purchase resulting from a sale of the
Equipment Notes permitted by Article IV) or prepayment (including upon
Acceleration) of all of the Equipment Notes issued pursuant to an Indenture on
the Special Distribution Date for such Special Payment in the following order
of priority:
first, such amount as shall be required to pay (A)
all accrued and unpaid Liquidity Expenses then in arrears plus
(B) the product of (x) the aggregate amount of all accrued and
unpaid Liquidity Expenses not in arrears to such Special
Distribution Date multiplied by (y) a fraction, the numerator
of which is the aggregate outstanding principal amount of
Equipment Notes being redeemed, purchased or prepaid on such
Special Distribution Date and the denominator of which is the
aggregate outstanding principal amount of all Equipment Notes,
shall be distributed to the Liquidity Providers pro rata on
the basis of the amount of Liquidity Expenses owed to each
Liquidity Provider;
second, such amount as shall be required to pay (A)
all accrued and unpaid interest (including interest accrued
and unpaid on any Interest Drawing or any Applied Provider
Advance (as defined in any Liquidity Facility)) then in
arrears on all Liquidity Obligations plus (B) the product of
(x) the aggregate amount of all accrued and unpaid interest
on all Liquidity Obligations not in arrears to such Special
Distribution Date (at the rate provided in the applicable
Liquidity Facility) multiplied by (y) a fraction, the
numerator of which is the aggregate outstanding principal
amount of Equipment Notes being redeemed, purchased or
prepaid on such Special Distribution Date and the denominator
of which is the aggregate outstanding principal amount of all
Equipment Notes, shall be distributed to the Liquidity
Providers pro rata on the basis of the amount of accrued and
unpaid interest owed to each Liquidity Provider;
third, such amount as shall be required (A) if any
Cash Collateral Account has been previously funded as
provided in Section 3.06(f), to fund such Cash Collateral
Account up to its Required Amount shall be deposited in such
Cash Collateral Account, (B) if any Liquidity Facility shall
have become a Downgraded Facility or a Non-Extended Facility
at a time when unreimbursed Interest Drawings under such
Liquidity Facility have reduced the Available Amount
thereunder to zero, to deposit into the related Cash
Collateral Account an amount equal to such Cash Collateral
Account's Required Amount shall be deposited in such Cash
Collateral Account, and (C) if, with respect to any
particular Liquidity Facility, neither subclause (A) nor
subclause (B) of this clause "third" is applicable, to pay or
reimburse the Liquidity Provider in respect of such Liquidity
Facility in an amount equal to the amount of any unreimbursed
Interest Drawings under such Liquidity Facility shall be
distributed to such Liquidity Provider, in each case pro rata
on the basis of the amounts of the required deposits and/or
unreimbursed Interest Drawings;
23
27
fourth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to
either subclause (A) or (B) of clause "third" above, then the
Liquidity Provider with respect to such Liquidity Facility
shall be paid the excess of (x) the aggregate outstanding
amount of unreimbursed Advances (whether or not then due)
under such Liquidity Facility over (y) the Required Amount
for the relevant Class, pro rata on the basis of such amounts
in respect of each Liquidity Provider;
fifth, if any Class A-1 Certificates or Class A-2
Certificates are Outstanding on such Special Distribution
Date, such amount as shall be required to pay in full
Expected Distributions to the holders of Class A-1
Certificates on such Special Distribution Date shall be
distributed to the Class A-1 Trustee and such amount as shall
be required to pay in full Expected Distributions to the
holders of Class A-2 Certificates on such Special
Distribution Date shall be distributed to the Class A-2
Trustee, pro rata on the basis of such amounts in respect of
each such Class of Certificates;
sixth, if any Class B Certificates are Outstanding
on such Special Distribution Date, such amount as shall be
required to pay in full Expected Distributions to the holders
of Class B Certificates on such Special Distribution Date
shall be distributed to the Class B Trustee;
seventh, if any Class C Certificates are Outstanding
on such Special Distribution Date, such amount as shall be
required to pay in full Expected Distributions to the holders
of Class C Certificates on such Special Distribution Date
shall be distributed to the Class C Trustee;
eighth, if the Class D Certificates have been issued
and any Class D Certificates are Outstanding on such Special
Distribution Date, such amount as shall be required to pay in
full Expected Distributions to holders of Class D
Certificates on such Special Distribution Date shall be
distributed to the Class D Trustee; and
ninth, the balance, if any, of such Special Payment
shall be deposited in the Collection Account.
For the purposes of this Section 2.04(b), clause (x) of the
definition of "Expected Distributions" shall be deemed to read as follows: "(x)
accrued, due and unpaid interest in respect of such Certificates together with
(without duplication) accrued and unpaid interest in respect of a portion of
such Certificates equal to the outstanding principal amount of Equipment Notes
being redeemed, purchased or prepaid (immediately prior to such redemption,
purchase or prepayment)".
(ii) Upon the occurrence of a Triggering Event (whether or
not continuing), the Subordination Agent shall make distributions pursuant to
this Section 2.04(b) of amounts on deposit in the Special Payments Account on
account of the redemption, purchase or prepayment
24
28
of the Equipment Notes issued pursuant to an Indenture on the Special
Distribution Date for such Special Payment in accordance with Section 3.03.
(c) Other Special Payments. Any amounts on deposit in the
Special Payments Account other than in respect of amounts to be distributed
pursuant to Section 2.04(b) shall be distributed on the Special Distribution
Date therefor in accordance with Article III.
(d) Investment of Amounts in Special Payments Account.
Any amounts on deposit in the Special Payments Account prior to the
distribution thereof pursuant to Section 2.04(b) or 2.04(c) shall be invested
in accordance with Section 2.02(b). Investment Earnings on such investments
shall be distributed in accordance with Section 2.04(b) or 2.04(c), as the case
may be.
Section 2.05. Designated Representatives. (a) With the
delivery of this Agreement, the Subordination Agent shall furnish to each
Liquidity Provider and each Trustee, and from time to time thereafter may
furnish to each Liquidity Provider and each Trustee, at the Subordination
Agent's discretion, or upon any Liquidity Provider's or Trustee's request
(which request shall not be made more than one time in any 12-month period), a
certificate (a "Subordination Agent Incumbency Certificate") of a Responsible
Officer of the Subordination Agent certifying as to the incumbency and specimen
signatures of the officers of the Subordination Agent and the attorney-in-fact
and agents of the Subordination Agent (the "Subordination Agent
Representatives") authorized to give Written Notices on behalf of the
Subordination Agent hereunder. Until each Liquidity Provider and Trustee
receives a subsequent Subordination Agent Incumbency Certificate, it shall be
entitled to rely on the last Subordination Agent Incumbency Certificate
delivered to it hereunder.
(b) With the delivery of this Agreement, each Trustee
shall furnish to the Subordination Agent, and from time to time thereafter may
furnish to the Subordination Agent, at such Trustee's discretion, or upon the
Subordination Agent's request (which request shall not be made more than one
time in any 12-month period), a certificate (with respect to each such Trustee,
a "Trustee Incumbency Certificate") of a Responsible Officer of such Trustee
certifying as to the incumbency and specimen signatures of the officers of such
Trustee and the attorney-in-fact and agents of such Trustee (with respect to
each such Trustee, the "Trustee Representatives") authorized to give Written
Notices on behalf of such Trustee hereunder. Until the Subordination Agent
receives a subsequent Trustee Incumbency Certificate from a Trustee, it shall
be entitled to rely on the last Trustee Incumbency Certificate with respect to
such Trustee delivered to it hereunder.
(c) With the delivery of this Agreement, each Liquidity
Provider shall furnish to the Subordination Agent, and from time to time
thereafter may furnish to the Subordination Agent, at such Liquidity Provider's
discretion, or upon the Subordination Agent's request (which request shall not
be made more than one time in any 12-month period), a certificate (with respect
to each such Liquidity Provider, an "LP Incumbency Certificate") of a
Responsible Officer of such Liquidity Provider certifying as to the incumbency
and specimen signatures of the officers of such Liquidity Provider and the
attorney-in-fact and agents of such Liquidity Provider (with respect to each
such Liquidity Provider, the "LP Representatives" and, together with the
Subordination Agent Representatives and the Trustee Representatives, the
"Designated
25
29
Representatives") authorized to give Written Notices on behalf of such
Liquidity Provider hereunder. Until the Subordination Agent receives a
subsequent LP Incumbency Certificate from a Liquidity Provider, it shall be
entitled to rely on the last LP Incumbency Certificate with respect to such
Liquidity Provider delivered to it hereunder.
Section 2.06. Controlling Party. (a) The Trustees and the
Liquidity Providers hereby agree that, with respect to any Indenture at any
given time, the Loan Trustee thereunder will be directed (i) in taking, or
refraining from taking, any action under such Indenture or with respect to the
Equipment Notes issued thereunder, so long as no Indenture Event of Default has
occurred and is continuing thereunder, by the holders of at least a majority of
the outstanding principal amount of such Equipment Notes (provided that, for so
long as the Subordination Agent is the registered holder of such Equipment
Notes, the Subordination Agent shall act with respect to this clause (i) in
accordance with the directions of the Trustees of Trusts for which the related
Trust Properties include, in the aggregate, such a majority of outstanding
principal amount of such Equipment Notes), and (ii) after the occurrence and
during the continuance of an Indenture Event of Default thereunder, in taking,
or refraining from taking, any action under such Indenture or with respect to
such Equipment Notes, including exercising remedies thereunder (including
Accelerating the Equipment Notes issued thereunder or foreclosing the Lien
created thereunder on the Aircraft securing such Equipment Notes), by the
Subordination Agent as directed by the Controlling Party.
(b) The Person who shall be the "Controlling Party" with
respect to any Indenture shall be: (w) initially, the Class A-1 Trustee or the
Class A-2 Trustee, whichever represents the Class with the larger Pool Balance
of Certificates Outstanding at the time such Indenture Event of Default occurs
(whether or not any other Indenture Event of Default shall thereafter occur so
long as such initial Indenture Event of Default shall continue); (x) upon
payment of Final Distributions to the holders of Certificates of such larger
Class, the other of the Class A-1 Trustee or the Class A-2 Trustee; (y) upon
payment of Final Distributions to the holders of Class A-1 Certificates and
Class A-2 Certificates, the Class B Trustee; and (z) upon payment of Final
Distributions to the holders of Class B Certificates, the Class C Trustee. For
purposes of giving effect to the foregoing, the Trustees (other than the
Controlling Party) irrevocably agree (and the Certificateholders (other than
the Certificateholders represented by the Controlling Party) shall be deemed to
agree by virtue of their purchase of Certificates) that the Subordination
Agent, as record holder of the Equipment Notes, shall exercise its voting
rights in respect of the Equipment Notes as directed by the Controlling Party
and any vote so exercised shall be binding upon the Trustees and all
Certificateholders.
The Subordination Agent shall give written notice to all of
the other parties to this Agreement promptly upon a change in the identity of
the Controlling Party. Each of the parties hereto agrees that it shall not
exercise any of the rights of the Controlling Party at such time as it is not
the Controlling Party hereunder; provided, however, that nothing herein
contained shall prevent or prohibit any Non-Controlling Party from exercising
such rights as shall be specifically granted to such Non-Controlling Party
hereunder and under the other Operative Agreements.
(c) Notwithstanding the foregoing, at any time after 18
months from the earliest to occur of (i) the date on which the entire Available
Amount under any Liquidity Facility shall have been drawn (for any reason other
than a Downgrade Drawing or a Xxx-
00
00
Extension Drawing) and remain unreimbursed, (ii) the date on which the entire
amount of any Downgrade Drawing or Non-Extension Drawing under any Liquidity
Facility shall have become and remain "Applied Downgrade Advances" or "Applied
Non-Extension Advances", as the case may be, under and as defined in such
Liquidity Facility and (iii) the date on which all Equipment Notes shall have
been Accelerated, the Liquidity Provider(s) with the greatest amount of
unreimbursed Liquidity Obligations shall have the right to elect, by Written
Notice to the Subordination Agent and each of the Trustees, to become the
Controlling Party hereunder with respect to any Indenture at any time from and
including the last day of such 18-month period.
(d) The exercise of remedies by the Controlling Party
under this Agreement shall be expressly limited by Section 4.01(a)(ii).
(e) The Controlling Party shall not be entitled to
require or obligate any Non-Controlling Party to provide funds necessary to
exercise any right or remedy hereunder.
(f) Notwithstanding anything contained herein, neither
the Controlling Party nor the Subordination Agent shall be authorized or
empowered to do anything that would cause any Trust to fail to qualify as a
"grantor trust" for federal income tax purposes.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED
Section 3.01. Written Notice of Distribution. (a) No later
than 3:00 P.M. (New York City time) on the Business Day immediately preceding
each Regular Distribution Date (or Special Distribution Date for purposes of
Section 2.04(b), as the case may be), each of the following Persons shall
deliver to the Subordination Agent a Written Notice setting forth the following
information as at the close of business on such Business Day:
(i) With respect to the Class A-1 Certificates and the
Class A-2 Certificates, if any are then Outstanding, the Class A-1
Trustee and the Class A-2 Trustee, respectively, shall separately set
forth the amounts to be paid in accordance with clause "fifth" of
Section 3.02 or 2.04(b), as the case may be (without giving effect to
the pro rata sharing therein);
(ii) With respect to the Class B Certificates, if any are
then Outstanding, the Class B Trustee shall separately set forth the
amounts to be paid in accordance with clause "sixth" of Section 3.02
or 2.04(b), as the case may be;
(iii) With respect to the Class C Certificates, if any are
then Outstanding, the Class C Trustee shall separately set forth the
amounts to be paid in accordance with clause "seventh" of Section 3.02
or 2.04(b), as the case may be;
(iv) With respect to each Liquidity Facility, the
Liquidity Provider thereunder shall separately set forth the amounts
to be paid in accordance with clauses "first", "second", "third" and
"fourth" of Section 3.02 or 2.04(b), as the case may be; and
27
31
(v) Each Trustee shall set forth the amounts to be paid
in accordance with clause "ninth" of Section 3.02.
The notices required under this Section 3.01(a) may be in the form of a schedule
or similar document provided to the Subordination Agent by the parties
referenced therein or by any one of them, which schedule or similar document may
state that, unless there has been a redemption, purchase or prepayment of the
Equipment Notes, such schedule or similar document is to remain in effect until
any substitute notice or amendment shall be given to the Subordination Agent by
the party providing such notice.
(b) Following the occurrence of a Triggering Event, the
Subordination Agent shall request the following information from the following
Persons, and may from time to time thereafter again request such information
from such Persons, and each of the following Persons shall, within five
Business Days of such request of the Subordination Agent, deliver a Written
Notice to the Subordination Agent setting forth for such Person the following
information:
(i) With respect to the Class A-1 Certificates and the
Class A-2 Certificates, if any are then Outstanding, the Class A-1
Trustee and the Class A-2 Trustee, respectively, shall separately set
forth the amounts to be paid in accordance with clauses "first" (to
reimburse payments made by the Class A-1 Certificateholders and the
Class A-2 Certificateholders, respectively, pursuant to subclause
(iii) of clause "first" of Section 3.03), "sixth" (to reimburse
payments made by the Class A-1 Certificateholders and the Class A-2
Certificateholders pursuant to subclause (iii) of clause "sixth" of
Section 3.03) and "seventh" of Section 3.03 (without giving effect to
the pro rata sharing therein);
(ii) With respect to the Class B Certificates, if any are
then Outstanding, the Class B Trustee shall separately set forth the
amounts to be paid in accordance with clauses "first" (to reimburse
payments made by the Class B Certificateholders pursuant to subclause
(iii) of clause "first" of Section 3.03), "sixth" (to reimburse
payments made by the Class B Certificateholders pursuant to subclause
(iii) of clause "sixth" of Section 3.03) and "eighth" of Section 3.03;
(iii) With respect to the Class C Certificates, if any are
then Outstanding, the Class C Trustee shall separately set forth the
amounts to be paid in accordance with clauses "first" (to reimburse
payments made by the Class C Certificateholders pursuant to subclause
(iii) of clause "first" of Section 3.03), "sixth" (to reimburse
payments made by the Class C Certificateholders pursuant to subclause
(iii) of clause "sixth" of Section 3.03) and "ninth" of Section 3.03;
(iv) With respect to each Liquidity Facility, the
Liquidity Provider thereunder shall separately set forth the amounts
to be paid to it in accordance with subclause (iii) of clause "first"
of Section 3.03 and clauses "second", "third", "fourth" and "fifth" of
Section 3.03; and
(v) Each Trustee shall set forth the amounts to be paid
in accordance with subclause (ii) of clause "first" of Section 3.03
and subclause (ii) of clause "sixth" of Section 3.03.
28
32
(c) At such time as a Trustee or a Liquidity Provider
shall have received all amounts owing to it (and, in the case of a Trustee, the
Certificateholders for which it is acting) pursuant to Section 2.04, 3.02 or
3.03, as applicable, and, in the case of a Liquidity Provider, its commitment
under the related Liquidity Facility shall have terminated or expired, such
Person shall, by a Written Notice, so inform the Subordination Agent and each
other party to this Agreement.
(d) As provided in Section 6.05, the Subordination Agent
shall be fully protected in relying on any of the information set forth in a
Written Notice provided by any Trustee or any Liquidity Provider pursuant to
Sections 3.01(a), 3.01(b) and 3.01(c) above and shall have no independent
obligation to verify, calculate or recalculate any amount set forth in any
Written Notice delivered in accordance with such paragraphs.
(e) Any Written Notice delivered by a Trustee or a
Liquidity Provider, as applicable, pursuant to Section 3.01(a), 3.01(b) or
3.01(c), if made prior to 10:00 A.M. (New York City time) on a given date that
is a Business Day shall be effective on the date delivered (or if delivered
later on such date or on a day that is not a Business Day shall be effective as
of the next Business Day). Subject to the terms of this Agreement, the
Subordination Agent shall as promptly as practicable comply with any such
instructions; provided, however, that any transfer of funds pursuant to any
instruction received after 10:00 A.M. (New York City time) on any Business Day
may be made on the next succeeding Business Day.
(f) In the event the Subordination Agent shall not
receive from any Person any information set forth in Section 3.01(a) or 3.01(b)
that is required to enable the Subordination Agent to make a distribution to
such Person pursuant to Section 2.04(b), 3.02 or 3.03, the Subordination Agent
shall not make such distribution(s) to such Person. In such event, the
Subordination Agent shall make distributions pursuant to clauses "first"
through "ninth" of Section 2.04(b), clauses "first" through "tenth" of Section
3.02 and clauses "first" through "eleventh" of Section 3.03 to the extent it
shall have sufficient information to enable it to make such distributions, and
shall continue to hold any funds remaining, after making such distributions, on
the terms hereof (including Section 2.02(b)) until the Subordination Agent
shall receive all necessary information to enable it to distribute any funds so
withheld, and upon receipt of the information necessary to distribute any funds
so withheld, the Subordination Agent shall distribute such funds.
(g) On such dates (but not more frequently than monthly)
as any Liquidity Provider or any Trustee shall request, but in any event
automatically at the end of each calendar quarter, the Subordination Agent
shall send to such party a written statement reflecting all amounts on deposit
with the Subordination Agent pursuant to Section 3.01(f).
Section 3.02. Distribution of Amounts on Deposit in the
Collection Account. Except as otherwise provided in Sections 2.04, 3.01(f),
3.03, 3.04 and 3.06(b), amounts on deposit in the Collection Account (or, in
the case of any amount described in Section 2.04(c), on deposit in the Special
Payments Account) shall be promptly distributed on each Regular Distribution
Date (or, in the case of any amount described in Section 2.04(c), on the
Special Distribution Date thereof) in the following order of priority and in
accordance with the information provided to the Subordination Agent pursuant to
Section 3.01(a):
29
33
first, such amount as shall be required to pay in
full all accrued and unpaid Liquidity Expenses owed shall be
distributed to the Liquidity Providers pro rata on the basis
of the amount of Liquidity Expenses owed to each Liquidity
Provider;
second, such amount as shall be required to pay
accrued and unpaid interest on the Liquidity Obligations as
provided in the applicable Liquidity Facility shall be
distributed to the Liquidity Providers pro rata on the basis
of the amount of such accrued and unpaid interest owed to
each Liquidity Provider;
third, such amount as shall be required (A) if any
Cash Collateral Account has been previously funded as
provided in Section 3.06(f), to fund such Cash Collateral
Account up to its Required Amount shall be deposited in such
Cash Collateral Account, (B) if any Liquidity Facility shall
have become a Downgraded Facility or a Non-Extended Facility
at a time when unreimbursed Interest Drawings under such
Liquidity Facility have reduced the Available Amount
thereunder to zero, to deposit into the related Cash
Collateral Account an amount equal to such Cash Collateral
Account's Required Amount shall be deposited in such Cash
Collateral Account, and (C) if, with respect to any
particular Liquidity Facility, neither subclause (A) nor
subclause (B) of this clause "third" is applicable, to pay or
reimburse the Liquidity Provider in respect of such Liquidity
Facility in an amount equal to the amount of all Liquidity
Obligations then due under such Liquidity Facility (other
than amounts payable pursuant to clause "first" or "second"
of this Section 3.02) shall be distributed to such Liquidity
Provider, in each case pro rata on the basis of the amounts
of the required deposits and/or unreimbursed Liquidity
Obligations;
fourth, if, with respect to any particular Liquidity
Facility and the related Cash Collateral Account, any amounts
are to be distributed pursuant to either subclause (A) or (B)
of clause "third" above, then the Liquidity Provider with
respect to such Liquidity Facility shall be paid the excess
of (x) the aggregate outstanding amount of unreimbursed
Advances (whether or not then due) under such Liquidity
Facility over (y) the Required Amount for the relevant Class,
pro rata on the basis of such amounts in respect of each
Liquidity Provider;
fifth, if any Class A-1 Certificates or Class A-2
Certificates are Outstanding on such Distribution Date, such
amount as shall be required to pay in full Expected
Distributions to the holders of the Class A-1 Certificates on
such Distribution Date shall be distributed to the Class A-1
Trustee and such amount as shall be required to pay in full
Expected Distributions to the holders of the Class A-2
Certificates on such Distribution Date shall be distributed
to the Class A-2 Trustee, pro rata on the basis of such
amounts in respect of each such Class of Certificates;
sixth, if any Class B Certificates are Outstanding
on such Distribution Date, such amount as shall be required
to pay in full Expected Distributions to the
30
34
holders of the Class B Certificates on such Distribution Date
shall be distributed to the Class B Trustee;
seventh, if any Class C Certificates are Outstanding
on such Distribution Date, such amount as shall be required
to pay in full Expected Distributions to the holders of the
Class C Certificates on such Distribution Date shall be
distributed to the Class C Trustee;
eighth, if the Class D Certificates have been issued
and any Class D Certificates are outstanding on such
Distribution Date, such amount as shall be required to pay in
full Expected Distributions to holders of Class D
Certificates on such Distribution Date shall be distributed
to the Class D Trustee; and
ninth, such amount as shall be required to pay in
full (without duplication of any amounts otherwise payable
hereunder or under any Operative Agreement) the aggregate
unpaid amount of fees and expenses payable as of such
Distribution Date to the Subordination Agent and each Trustee
pursuant to the terms of this Agreement and the Trust
Agreements, as the case may be, shall be distributed to the
Subordination Agent and such Trustee; and
tenth, the balance, if any, of any such amount
remaining thereafter shall be held in the Collection Account
for later distribution in accordance with this Article III.
Section 3.03. Distribution of Amounts on Deposit
Following a Triggering Event. Except as otherwise provided in Sections 3.01(f)
and 3.06(b), upon the occurrence of a Triggering Event and at all times
thereafter, all funds in the Collection Account or the Special Payments Account
shall be promptly distributed by the Subordination Agent in the following order
of priority:
first, such amount as shall be required to reimburse
(i) the Subordination Agent for any out-of-pocket costs and
expenses actually incurred by it (to the extent not previously
reimbursed) in the protection of, or the realization of the
value of, the Equipment Notes or any Collateral, shall be
applied by the Subordination Agent in reimbursement of such
costs and expenses, (ii) each Trustee for any amounts of the
nature described in clause (i) above actually incurred by it
under the applicable Trust Agreement (to the extent not
previously reimbursed), shall be distributed to such Trustee,
and (iii) any Liquidity Provider or Certificateholder for
payments, if any, made by it to the Subordination Agent or any
Trustee in respect of amounts described in clause (i) above,
shall be distributed to such Liquidity Provider or to the
applicable Trustee for the account of such Certificateholder,
in each such case, pro rata on the basis of all amounts
described in clauses (i), (ii) and (iii) above;
second, such amount as shall be required to pay all
accrued and unpaid Liquidity Expenses shall be distributed to
the Liquidity Providers pro rata on the basis of the amount
of Liquidity Expenses owed to each Liquidity Provider;
31
35
third, such amount as shall be required to pay
accrued and unpaid interest on the Liquidity Obligations as
provided in the applicable Liquidity Facilities shall be
distributed to the Liquidity Providers pro rata on the basis
of the amount of such accrued and unpaid interest owed to
each Liquidity Provider;
fourth, such amount as shall be required (A) if any
Cash Collateral Account has been previously funded as
provided in Section 3.06(f), unless (i) a Performing Note
Deficiency exists and a Liquidity Event of Default shall have
occurred and be continuing with respect to the relevant
Liquidity Facility or (ii) a Final Drawing shall have
occurred with respect to such Liquidity Facility, to fund
such Cash Collateral Account up to its Required Amount (less
the amount of any repayments of Interest Drawings under such
Liquidity Facility while subclause (A)(i) above is
applicable) shall be deposited in such Cash Collateral
Account, (B) if any Liquidity Facility shall have become a
Downgraded Facility or a Non-Extended Facility at a time when
unreimbursed Interest Drawings under such Liquidity Facility
have reduced the Available Amount thereunder to zero, unless
(i) a Performing Note Deficiency exists and a Liquidity Event
of Default shall have occurred and be continuing with respect
to the relevant Liquidity Facility or (ii) a Final Drawing
shall have occurred with respect to such Liquidity Facility,
to deposit into the related Cash Collateral Account an amount
equal to such Cash Collateral Account's Required Amount (less
the amount of any repayments of Interest Drawings under such
Liquidity Facility while subclause (B)(i) above is
applicable) shall be deposited in such Cash Collateral
Account, and (C) if, with respect to any particular Liquidity
Facility, neither subclause (A) nor subclause (B) of this
clause "fourth" is applicable, to pay in full the outstanding
amount of all Liquidity Obligations then due under such
Liquidity Facility (other than amounts payable pursuant to
clause "second" or "third" of this Section 3.03) shall be
distributed to such Liquidity Provider, in each case pro rata
on the basis of the amounts of the required deposits and/or
unreimbursed Liquidity Obligations;
fifth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to
either subclause (A) or (B) of clause "fourth" above, then
the Liquidity Provider with respect to such Liquidity
Facility shall be paid the excess of (x) the aggregate
outstanding amount of unreimbursed Advances (whether or not
then due) under such Liquidity Facility over (y) the Required
Amount for the relevant Class (less the amount of any
repayments of Interest Drawings under such Liquidity Facility
while subclause (A)(i) or (B)(i), as the case may be, of
clause "fourth" above is applicable), pro rata on the basis
of such amounts in respect of each Liquidity Provider;
sixth, such amount as shall be required to reimburse
or pay (i) the Subordination Agent for any Tax (other than
Taxes imposed on compensation paid hereunder), expense, fee,
charge or other loss incurred by, or any other amount payable
to, the Subordination Agent in connection with the
transactions contemplated hereby (to the extent not
previously reimbursed), shall be applied by the Subordination
Agent in reimbursement of such amount, (ii) each Trustee for
any Tax (other than Taxes imposed on compensation paid under
the applicable
32
36
Trust Agreement), expense, fee, charge or other loss incurred
by, or any other amount payable to, such Trustee under the
applicable Trust Agreements (to the extent not previously
reimbursed), shall be distributed to such Trustee, and (iii)
each Certificateholder for payments, if any, made by it
pursuant to Section 5.02 in respect of amounts described in
clause (i) above (without duplication of any amounts
distributed pursuant to subclause (iii) of clause "first" of
this Section 3.03), shall be distributed to the applicable
Trustee for the account of such Certificateholder, in each
such case pro rata on the basis of all amounts described in
clauses (i), (ii) and (iii) above;
seventh, if any Class A-1 Certificates or Class A-2
Certificates are Outstanding on such Distribution Date, such
amount remaining as shall be required to pay in full Adjusted
Expected Distributions on the Class A-1 Certificates shall be
distributed to the Class A-1 Trustee and such amount
remaining as shall be required to pay in full Adjusted
Expected Distributions on the Class A-2 Certificates shall be
distributed to the Class A-2 Trustee, pro rata on the basis
of such amounts in respect of each such Class of
Certificates;
eighth, if any Class B Certificates are Outstanding
on such Distribution Date, such amount remaining as shall be
required to pay in full Adjusted Expected Distributions on
the Class B Certificates shall be distributed to the Class B
Trustee;
ninth, if any Class C Certificates are Outstanding
on such Distribution Date, such amount remaining as shall be
required to pay in full Adjusted Expected Distributions on
the Class C Certificates shall be distributed to the Class C
Trustee;
tenth, if the Class D Certificates have been issued
and any Class D Certificates are Outstanding on such
Distribution Date, such amount remaining as shall be required
to pay in full Adjusted Expected Distributions on the Class D
Certificates shall be distributed to the Class D Trustee; and
eleventh, (i) if any Class A-1 Certificates or Class
A-2 Certificates are Outstanding on such Distribution Date,
such amount remaining as shall be required to pay Final
Distributions on the Class A-1 Certificates shall be
distributed to the Class A-1 Trustee and such amount
remaining as shall be required to pay Final Distributions on
the Class A-2 Certificates shall be distributed to the Class
A-2 Trustee, pro rata on the basis of the Pool Balance of
each such Class of Certificates after giving effect to the
distributions made on such Distribution Date pursuant to
clause "seventh" of this Section 3.03(a); (ii) after giving
effect to clause (i) if any Class B Certificates are
Outstanding on such Distribution Date, such amount remaining
as shall be required to pay Final Distributions on the Class
B Certificates shall be distributed to the Class B Trustee;
(iii) after giving effect to clauses (i) and (ii) if any
Class C Certificates are Outstanding on such Distribution
Date, such amount remaining as shall be required to pay Final
Distributions on the Class C Certificates shall be
distributed
33
37
to the Class C Trustee and (iv) after giving effect to
clauses (i), (ii) and (iii) if the Class D Certificates have
been issued and any Class D Certificates are Outstanding on
such Distribution Date, such amount remaining as shall be
required to pay Final Distributions on the Class D
Certificates shall be distributed to the Class D Trustee.
Section 3.04. Other Payments. (a) Any payments received by
the Subordination Agent for which no provision as to the application thereof is
made in this Agreement shall be distributed by the Subordination Agent in the
order of priority specified in Section 3.03; provided, however, that to the
extent any such payments are received or realized at any time after the Final
Distributions for all Classes of Certificates have been made, such payments
shall be distributed in the following order of priority: first, in the manner
provided in clause "first" of Section 3.03 and second, in the manner provided
in clause "tenth" of Section 3.02.
(b) On any Interest Payment Date under each Liquidity
Facility which is not a Distribution Date, the Subordination Agent shall pay to
the Liquidity Provider under such Liquidity Facility from, and to the extent
of, amounts on deposit in the Collection Account, an amount equal to the amount
of interest then due and payable to such Liquidity Provider under such
Liquidity Facility.
(c) Except as otherwise provided in Section 3.03 or
Sections 3.06(a) and 3.06(b), if the Subordination Agent receives any Scheduled
Payment after the Scheduled Payment Date relating thereto, but prior to such
payment becoming an Overdue Scheduled Payment, then the Subordination Agent
shall deposit such Scheduled Payment in the Collection Account and promptly
distribute such Scheduled Payment in accordance with the priority of
distributions set forth in Section 3.02; provided that, for the purposes of
this Section 3.04(c) only, each reference in clause "ninth" of Section 3.02 to
"Distribution Date" shall be deemed to mean the actual date of payment of such
Scheduled Payment and each reference in clause "fifth", "sixth", "seventh" or
"eighth" of Section 3.02 to "Distribution Date" shall be deemed to refer to
such Scheduled Payment Date.
Section 3.05. Payments to the Trustees and the Liquidity
Providers. Any amounts distributed hereunder to any Liquidity Provider shall be
paid to such Liquidity Provider by wire transfer of funds to the address such
Liquidity Provider shall provide to the Subordination Agent. The Subordination
Agent shall provide a Written Notice of any such transfer to the applicable
Liquidity Provider at the time of such transfer. Any amounts distributed
hereunder by the Subordination Agent to any Trustee that is not the same
institution as the Subordination Agent shall be paid to such Trustee by wire
transfer of funds at the address such Trustee shall provide to the
Subordination Agent.
Section 3.06. Liquidity Facilities. (a) Interest Drawings.
If on any Distribution Date, after giving effect to the subordination
provisions of this Agreement, the Subordination Agent shall not have sufficient
funds for the payment of any amounts due and owing in respect of accrued
interest on the Class A-1 Certificates, the Class A-2 Certificates, the Class B
Certificates or the Class C Certificates (at the Stated Interest Rate for such
Class of Certificates), then, prior to 1:00 p.m. (New York City time) on such
Distribution Date, the Subordination Agent shall request a drawing (each such
drawing, an "Interest Drawing") under the Liquidity
34
38
Facility with respect to such Class of Certificates in an amount equal to the
lesser of (i) an amount sufficient to pay the amount of such accrued interest
(at the Stated Interest Rate for each such Class of Certificates) and (ii) the
Available Amount under such Liquidity Facility, and shall upon receipt of such
amount pay such amount to the Trustee with respect to each such Class of
Certificates in payment of such accrued interest as provided in Section
3.06(b).
(b) Application of Interest Drawings. Notwithstanding
anything to the contrary contained in this Agreement, (i) all payments received
by the Subordination Agent in respect of an Interest Drawing under the Class
A-1 Liquidity Facility and all amounts withdrawn by the Subordination Agent
from the Class A-1 Cash Collateral Account, and payable in each case to the
Class A-1 Certificateholders, shall be promptly distributed to the Class A-1
Trustee, (ii) all payments received by the Subordination Agent in respect of an
Interest Drawing under the Class A-2 Liquidity Facility and all amounts
withdrawn by the Subordination Agent from the Class A-2 Cash Collateral
Account, and payable in each case to the Class A-2 Certificateholders, shall be
promptly distributed to the Class A-2 Trustee, (iii) all payments received by
the Subordination Agent in respect of an Interest Drawing under the Class B
Liquidity Facility and all amounts withdrawn by the Subordination Agent from
the Class B Cash Collateral Account, and payable in each case to the Class B
Certificateholders, shall be promptly distributed to the Class B Trustee, and
(iv) all payments received by the Subordination Agent in respect of an Interest
Drawing under the Class C Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class C Cash Collateral Account, and payable in
each case to the Class C Certificateholders, shall be promptly distributed to
the Class C Trustee.
(c) Downgrade Drawings. The Liquidity Provider will
promptly, but in any event within ten days of its receipt of notice thereof,
deliver notice of any downgrading of its debt ratings to the Subordination
Agent and Delta. If at any time the short-term unsecured debt rating of any
Liquidity Provider issued by either Rating Agency (or, if such Liquidity
Provider does not have a short-term unsecured debt rating issued by a given
Rating Agency, the long-term unsecured debt rating of such Liquidity Provider
issued by such Rating Agency) is lower than the applicable Threshold Rating,
within 10 days after such Liquidity Provider receives notice of such
downgrading (or within 30 days after its receipt of such notice solely in the
event of a downgrading of such Liquidity Provider's short-term unsecured debt
rating by S&P from A-1+ to A-1) (but not later than the expiration date of the
Liquidity Facility issued by the downgraded Liquidity Provider (the "Downgraded
Facility")), such Liquidity Provider or Delta may arrange for a Replacement
Liquidity Provider to issue and deliver a Replacement Liquidity Facility to the
Subordination Agent. If a Downgraded Facility has not been replaced in
accordance with the terms of this paragraph, the Subordination Agent shall, on
such 10th (or 30th) day (or if such 10th (or 30th) day is not a Business Day,
on the next succeeding Business Day) (or, if earlier, on the expiration date of
such Downgraded Facility), request a drawing in accordance with and to the
extent permitted by such Downgraded Facility (such drawing, a "Downgrade
Drawing") of all available and undrawn amounts thereunder. Amounts drawn
pursuant to a Downgrade Drawing shall be maintained and invested as provided in
Section 3.06(f). Subject to Section 3.06(e)(iii), the Liquidity Provider may
also arrange for a Replacement Liquidity Provider to issue and deliver a
Replacement Liquidity Facility at any time after such Downgrade Drawing so long
as such Downgrade Drawing has not been reimbursed in full to the Liquidity
Provider.
35
39
(d) Non-Extension Drawings. If any Liquidity Facility
with respect to any Class of Certificates is scheduled to expire on a date (the
"Stated Expiration Date") prior to the date that is 15 days after the Final
Legal Distribution Date for such Class of Certificates, then no earlier than
the 60th day and no later than the 40th day prior to the then applicable Stated
Expiration Date, the Subordination Agent shall request in writing that such
Liquidity Provider extend the Stated Expiration Date to the earlier of (i) the
date that is 15 days after the Final Legal Distribution Date for such Class of
Certificates and (ii) the date that is the day immediately preceding the 364th
day after the last day of the Consent Period (unless the obligations of such
Liquidity Provider thereunder are earlier terminated in accordance with such
Liquidity Facility). The Liquidity Provider shall by notice (the "Consent
Notice") to the Subordination Agent during the period commencing on the date
that is 60 days prior to the then effective Stated Expiration Date and ending
on the date that is 25 days prior to such Stated Expiration Date (the "Consent
Period") advise the Subordination Agent whether, in its sole discretion, it
agrees to so extend the Stated Expiration Date; provided, however, that such
extension shall not be effective with respect to such Liquidity Provider if, by
notice (the "Withdrawal Notice") to the Subordination Agent prior to the end of
the Consent Period, the Liquidity Provider revokes its Consent Notice. If the
Liquidity Provider advises the Subordination Agent in the Consent Notice that
such Stated Expiration Date shall not be so extended or gives a Withdrawal
Notice to the Subordination Agent prior to the end of the Consent Period, or
fails to irrevocably and unconditionally advise the Subordination Agent on or
before the end of the Consent Period that such Stated Expiration Date shall be
so extended (and, in each case, if the Liquidity Provider shall not have been
replaced in accordance with Section 3.06(e)), the Subordination Agent shall, on
the date on which the Consent Period ends (or as soon as possible thereafter
but prior to the Stated Expiration Date), in accordance with and to the extent
permitted by the terms of the expiring Liquidity Facility (a "Non-Extended
Facility"), request a drawing under such expiring Liquidity Facility (such
drawing, a "Non-Extension Drawing") of all available and undrawn amounts
thereunder. Amounts drawn pursuant to a Non-Extension Drawing shall be
maintained and invested in accordance with Section 3.06(f). If any amounts
shall be drawn pursuant to a Non-Extension Drawing and, within 30 days
thereafter, the Liquidity Provider shall not have been replaced, then at any
time following the 30th day after such Non-Extension Drawing, the Liquidity
Provider may, by written notice to the Subordination Agent, agree to reinstate
the Liquidity Facility on the terms of the existing Liquidity Facility for a
period ending on the 364th day after the end of the Consent Period; provided,
however, that in such event the Liquidity Provider shall reimburse the
Subordination Agent for any costs actually incurred by or on behalf of the
Subordination Agent in drawing pursuant to the Non-Extension Drawing and
funding the Cash Collateral Account or otherwise in connection with the
Non-Extension Drawing.
(e) Issuance of Replacement Liquidity Facility. (i)
Subject to Section 3.06(e)(iii), at any time, Delta may, at its option, with
cause or without cause, arrange for a Replacement Liquidity Facility to replace
any Liquidity Facility for any Class of Certificates (including any Replacement
Liquidity Facility provided pursuant to Section 3.06(e)(ii)); provided,
however, that if the initial Liquidity Provider is replaced it shall be
replaced with respect to all Liquidity Facilities under which it is a Liquidity
Provider, and provided further, however, that the initial Liquidity Provider
shall not be replaced by Delta as the Liquidity Provider with respect to any
Class of Certificates prior to the fifth anniversary of the Closing Date unless
(A) there shall have become due to the initial Liquidity Provider, or the
initial Liquidity Provider shall have demanded, amounts pursuant to Section
3.01 or 3.03 of any
36
40
Liquidity Facility and the replacement of the initial Liquidity Provider would
reduce or eliminate the obligation to pay such amounts or Delta determines in
good faith that there is a substantial likelihood that the initial Liquidity
Provider will have the right to claim any such amounts within 180 days after
the date of such determination (unless the initial Liquidity Provider waives,
in writing, any right it may have to claim such amounts), which determination
shall be set forth in a certificate delivered by Delta to the initial Liquidity
Provider accompanied by an opinion of outside counsel selected by Delta and
reasonably acceptable to such initial Liquidity Provider verifying the legal
conclusions, if any, of such certificate relating to such basis, provided that
in the case of any likely claim for amounts based upon any proposed, or
proposed change in, law, rule, regulation, interpretation, directive,
requirement, request or administrative practice, such opinion may assume the
adoption or promulgation of such proposed matter, (B) it shall become unlawful
or impossible for the initial Liquidity Provider to maintain or fund its LIBOR
Advances as described in Section 3.10 of any Liquidity Facility, (C) the
short-term unsecured debt rating of the initial Liquidity Provider is
downgraded by S&P from A-1+ to A-1 and there is a resulting downgrade in the
rating by either Rating Agency of any Class of Certificates, (D) any Liquidity
Facility of such initial Liquidity Provider shall become a Downgraded Facility
or a Non-Extended Facility or a Downgrade Drawing or a Non-Extension Drawing
shall have occurred under any Liquidity Facility or (E) the initial Liquidity
Provider shall have breached any of its payment (including, without limitation,
funding) obligations under any Liquidity Facility. If such Replacement
Liquidity Facility is provided at any time after a Downgrade Drawing or a
Non-Extension Drawing has been made, all funds on deposit in the relevant Cash
Collateral Account resulting from such Downgrade Drawing or Non-Extension
Drawing will be returned to the Liquidity Provider being replaced.
(ii) If any Liquidity Provider shall determine not to
extend its Liquidity Facility in accordance with Section 3.06(d), then such
Liquidity Provider may, at its option, arrange for a Replacement Liquidity
Facility to replace such Liquidity Facility during the period no earlier than
40 days and no later than 25 days prior to the then effective Stated Expiration
Date of such Liquidity Facility.
(iii) No Replacement Liquidity Facility arranged by Delta
or a Liquidity Provider in accordance with Section 3.06(c) or clause (i) or
(ii) of this Section 3.06(e) shall become effective and no such Replacement
Liquidity Facility shall be deemed a "Liquidity Facility" under the Operative
Agreements, unless and until (A) each of the conditions referred to in Section
3.06(e)(iv) below shall have been satisfied and (B) in the case of a
Replacement Liquidity Facility arranged by a Liquidity Provider under Section
3.06(c) or Section 3.06(e)(ii), such Replacement Liquidity Provider and such
Replacement Liquidity Facility (including the fees, compensation, interest,
increased costs or withholding payable thereunder to the Replacement Liquidity
Provider) are acceptable to Delta.
(iv) In connection with the issuance of each Replacement
Liquidity Facility, the Subordination Agent shall (x) prior to the issuance of
such Replacement Liquidity Facility, obtain written confirmation from each
Rating Agency that such Replacement Liquidity Facility will not cause a
reduction of any rating then in effect for any Class of Certificates by such
Rating Agency (without regard to any downgrading of any rating of any Liquidity
Provider being replaced pursuant to Section 3.06(c)), (y) pay all Liquidity
Obligations then owing to the replaced Liquidity Provider (which payment shall
be made first from available funds in the
37
41
applicable Cash Collateral Account as described in Section 3.06(f)(ix), and
thereafter from any other available source, including, without limitation, a
drawing under the Replacement Liquidity Facility) and (z) cause the issuer of
the Replacement Liquidity Facility to deliver the Replacement Liquidity
Facility to the Subordination Agent, together with a legal opinion addressed to
the Subordination Agent, the Trustees and Delta opining that such Replacement
Liquidity Facility is an enforceable obligation of such Replacement Liquidity
Provider.
(v) Upon satisfaction of the conditions set forth in
Sections 3.06(e)(iii) and 3.06(e)(iv), (1) the replaced Liquidity Facility
shall terminate, (2) the Subordination Agent shall, if and to the extent so
requested by Delta or the Liquidity Provider being replaced, execute and
deliver any certificate or other instrument required in order to terminate the
replaced Liquidity Facility, shall surrender the replaced Liquidity Facility to
the Liquidity Provider being replaced and shall execute and deliver the
Replacement Liquidity Facility and any associated Fee Letter, (3) each of the
parties hereto shall enter into any amendments to this Agreement necessary to
give effect to the replacement of the applicable Liquidity Provider with the
applicable Replacement Liquidity Provider and the replacement of the applicable
Liquidity Facility with the applicable Replacement Liquidity Facility and (4)
the applicable Replacement Liquidity Provider shall be deemed to be a Liquidity
Provider with the rights and obligations of a Liquidity Provider hereunder and
under the other Operative Agreements and such Replacement Liquidity Facility
shall be deemed to be a Liquidity Facility hereunder and under the other
Operative Agreements.
(f) Cash Collateral Accounts; Withdrawals; Investments.
If the Subordination Agent shall draw all available amounts under the Class A-1
Liquidity Facility, the Class A-2 Liquidity Facility, the Class B Liquidity
Facility or the Class C Liquidity Facility pursuant to Section 3.06(c), 3.06(d)
or 3.06(i), or in the event amounts are to be deposited in the Cash Collateral
Account pursuant to subclause (A) or (B) of clause "third" of Section 2.04(b),
subclause (A) or (B) of clause "third" of Section 3.02 or subclause (A) or (B)
of clause "fourth" of Section 3.03, amounts so drawn or to be deposited, as the
case may be, shall be deposited by the Subordination Agent in the Class A-1
Cash Collateral Account, the Class A-2 Cash Collateral Account, the Class B
Cash Collateral Account or the Class C Cash Collateral Account, respectively.
All amounts on deposit in each Cash Collateral Account shall be invested and
reinvested in Eligible Investments in accordance with Section 2.02(b). On each
Interest Payment Date (or, in the case of any Special Distribution Date
occurring prior to the occurrence of a Triggering Event, on such Special
Distribution Date), Investment Earnings on amounts on deposit in each Cash
Collateral Account (or in the case of any Special Distribution Date occurring
prior to the occurrence of a Triggering Event, an amount of such Investment
Earnings on amounts of deposits in each Cash Collateral Account equal to the
product of such Investment Earnings multiplied by a fraction, the numerator of
which is the aggregate outstanding principal amount of Equipment Notes being
redeemed, purchased or prepaid on such Special Distribution Date and the
denominator of which is the aggregate outstanding principal amount of all
Equipment Notes) shall be deposited in the Collection Account (or, in the case
of any Special Distribution Date occurring prior to the occurrence of a
Triggering Event, the Special Payments Account) and applied on such Interest
Payment Date (or Special Distribution Date, as the case may be) in accordance
with Section 2.04(b), 3.02, 3.03 or 3.04(b) (as applicable). The Subordination
Agent shall deliver a written statement to Delta and the Liquidity Provider one
day prior to each Interest Payment Date and Special Distribution Date setting
forth the aggregate amount of Investment Earnings held in the Cash Collateral
Accounts as of such date. In addition,
38
42
from and after the date funds are so deposited, the Subordination Agent shall
make withdrawals from such account as follows:
(i) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay accrued
and unpaid interest due and owing on the Class A-1 Certificates (at
the Stated Interest Rate for the Class A-1 Certificates) from any
other source, withdraw from the Class A-1 Cash Collateral Account, and
pay to the Class A-1 Trustee, an amount equal to the lesser of (x) an
amount necessary to pay accrued and unpaid interest (at the Stated
Interest Rate for the Class A-1 Certificates) on such Class A-1
Certificates and (y) the amount on deposit in the Class A-1 Cash
Collateral Account;
(ii) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay accrued
and unpaid interest due and owing on the Class A-2 Certificates (at
the Stated Interest Rate for the Class A-2 Certificates) from any
other source, withdraw from the Class A-2 Cash Collateral Account, and
pay to the Class A-2 Trustee, an amount equal to the lesser of (x) an
amount necessary to pay accrued and unpaid interest (at the Stated
Interest Rate for the Class A-2 Certificates) on such Class A-2
Certificates and (y) the amount on deposit in the Class A-2 Cash
Collateral Account;
(iii) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay accrued
and unpaid interest due and owing on the Class B Certificates (at the
Stated Interest Rate for the Class B Certificates) from any other
source, withdraw from the Class B Cash Collateral Account, and pay to
the Class B Trustee, an amount equal to the lesser of (x) an amount
necessary to pay accrued and unpaid interest (at the Stated Interest
Rate for the Class B Certificates) on such Class B Certificates and
(y) the amount on deposit in the Class B Cash Collateral Account;
(iv) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay accrued
and unpaid interest due and owing on the Class C Certificates (at the
Stated Interest Rate for the Class C Certificates) from any other
source, withdraw from the Class C Cash Collateral Account, and pay to
the Class C Trustee, an amount equal to the lesser of (x) an amount
necessary to pay accrued and unpaid interest (at the Stated Interest
Rate for the Class C Certificates) on such Class C Certificates and
(y) the amount on deposit in the Class C Cash Collateral Account;
(v) on each date on which the Pool Balance of the Class
A-1 Trust shall have been reduced by payments made to the Class A-1
Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the
Subordination Agent shall withdraw from the Class A-1 Cash Collateral
Account such amount as is necessary so that, after giving effect to
the reduction of such Pool Balance on such date (including any such
reduction resulting from a prior withdrawal of amounts on deposit in
the Class A-1 Cash Collateral Account on such date) and any transfer
of Investment Earnings from such Class A-1 Cash Collateral Account to
the Collection Account or the Special Payments Account on such date,
an amount equal to the sum of the Required Amount (with respect to the
Class A-1 Liquidity Facility) plus the remaining Investment Earnings
on deposit in such Class A-1 Cash Collateral Account (if any) will be
on deposit in the Class A-1 Cash Collateral Account and shall, first,
pay such withdrawn amount to the relevant Class A-1 Liquidity Provider
39
43
until the Liquidity Obligations (with respect to the Class A-1
Certificates) owing to such Class A-1 Liquidity Provider shall have
been paid in full and, second, deposit any remaining amount in the
Collection Account;
(vi) on each date on which the Pool Balance of the Class
A-2 Trust shall have been reduced by payments made to the Class A-2
Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the
Subordination Agent shall withdraw from the Class A-2 Cash Collateral
Account such amount as is necessary so that, after giving effect to
the reduction of such Pool Balance on such date (including any such
reduction resulting from a prior withdrawal of amounts on deposit in
the Class A-2 Cash Collateral Account on such date) and any transfer
of Investment Earnings from such Class A-2 Cash Collateral Account to
the Collection Account or the Special Payments Account on such date,
an amount equal to the sum of the Required Amount (with respect to the
Class A-2 Liquidity Facility) plus the remaining Investment Earnings
on deposit in such Class A-2 Cash Collateral Account (if any) will be
on deposit in the Class A-2 Cash Collateral Account and shall, first,
pay such withdrawn amount to the relevant Class A-2 Liquidity Provider
until the Liquidity Obligations (with respect to the Class A-2
Certificates) owing to such Class A-2 Liquidity Provider shall have
been paid in full and, second, deposit any remaining amount in the
Collection Account;
(vii) on each date on which the Pool Balance of the Class B
Trust shall have been reduced by payments made to the Class B
Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the
Subordination Agent shall withdraw from the Class B Cash Collateral
Account such amount as is necessary so that, after giving effect to
the reduction of such Pool Balance on such date (including any such
reduction resulting from a prior withdrawal of amounts on deposit in
the Class B Cash Collateral Account on such date) and any transfer of
Investment Earnings from such Class B Cash Collateral Account to the
Collection Account or the Special Payments Account on such date, an
amount equal to the sum of the Required Amount (with respect to the
Class B Liquidity Facility) plus the remaining Investment Earnings on
deposit in such Class B Cash Collateral Account (if any) will be on
deposit in the Class B Cash Collateral Account and shall, first, pay
such withdrawn amount to the relevant Class B Liquidity Provider until
the Liquidity Obligations (with respect to the Class B Certificates)
owing to such Class B Liquidity Provider shall have been paid in full
and, second, deposit any remaining amount in the Collection Account;
(viii) on each date on which the Pool Balance of the Class C
Trust shall have been reduced by payments made to the Class C
Certificateholders pursuant to Section 2.04(b), 3.02 or 3.03, the
Subordination Agent shall withdraw from the Class C Cash Collateral
Account such amount as is necessary so that, after giving effect to
the reduction of such Pool Balance on such date (including any such
reduction resulting from a prior withdrawal of amounts on deposit in
the Class C Cash Collateral Account on such date) and any transfer of
Investment Earnings from such Class C Cash Collateral Account to the
Collection Account or the Special Payments Account on such date, an
amount equal to the sum of the Required Amount (with respect to the
Class C Liquidity Facility) plus the remaining Investment Earnings on
deposit in such Class C Cash Collateral Account (if any) will be on
deposit in the Class C Cash Collateral Account and shall,
40
44
first, pay such withdrawn amount to the relevant Class C Liquidity
Provider until the Liquidity Obligations (with respect to the Class C
Certificates) owing to such Liquidity Provider shall have been paid in
full and, second, deposit any remaining amount in the Collection
Account;
(ix) if a Replacement Liquidity Facility for any Class of
Certificates shall be delivered to the Subordination Agent following
the date on which funds have been deposited into the Cash Collateral
Account for such Class of Certificates, the Subordination Agent shall
withdraw all amounts remaining on deposit in such Cash Collateral
Account and shall pay such amounts to the replaced Liquidity Provider
until all Liquidity Obligations owed to such Person shall have been
paid in full, and deposit any remaining amount in the Collection
Account; and
(x) following the payment of Final Distributions with
respect to any Class of Certificates, on the date on which the
Subordination Agent shall have been notified by the Liquidity Provider
for such Class of Certificates that the Liquidity Obligations owed to
such Liquidity Provider have been paid in full, the Subordination
Agent shall withdraw all amounts on deposit in the Cash Collateral
Account in respect of such Class of Certificates and deposit such
amount in the Collection Account.
(g) Reinstatement. With respect to any Interest Drawing
under the Liquidity Facility for any Trust, upon the reimbursement of
the applicable Liquidity Provider for all or any part of the amount of
such Interest Drawing, together with any accrued interest thereon, the
Available Amount of such Liquidity Facility shall be reinstated by an
amount equal to the amount of such Interest Drawing so reimbursed to
the applicable Liquidity Provider but not to exceed the Stated Amount
for such Liquidity Facility; provided, however, that the Available
Amount of such Liquidity Facility shall not be so reinstated in part
or in full at any time if (x) both a Performing Note Deficiency exists
and a Liquidity Event of Default shall have occurred and be continuing
with respect to the relevant Liquidity Facility or (y) a Final Drawing
shall have occurred with respect to such Liquidity Facility. In the
event that, with respect to any particular Liquidity Facility, (i)
funds are withdrawn from any Cash Collateral Account pursuant to
clause (i), (ii), (iii) or (iv) of Section 3.06(f) or (ii) such
Liquidity Facility shall become a Downgraded Facility or a
Non-Extended Facility at a time when unreimbursed Interest Drawings
under such Liquidity Facility have reduced the Available Amount
thereunder to zero, then funds received by the Subordination Agent at
any time, other than (x) any time when both a Performing Note
Deficiency exists and a Liquidity Event of Default shall have occurred
and be continuing with respect to such Liquidity Facility or (y) any
time after a Final Drawing shall have occurred with respect to such
Liquidity Facility, shall be deposited in such Cash Collateral Account
as and to the extent provided in clause "third" of Section 2.04(b),
clause "third" of Section 3.02 or clause "fourth" of Section 3.03, as
applicable, and applied in accordance with Section 3.06(f).
(h) Reimbursement. The amount of each drawing under the
Liquidity Facilities shall be due and payable, together with interest
thereon, on the dates and at the rates, respectively, provided in the
Liquidity Facilities.
41
45
(i) Final Drawing. Upon receipt from a Liquidity Provider
of a Termination Notice with respect to any Liquidity Facility, the
Subordination Agent shall, not later than the date specified in such
Termination Notice, in accordance with and to the extent permitted by
the terms of such Liquidity Facility, request a drawing under such
Liquidity Facility of all available and undrawn amounts thereunder (a
"Final Drawing"). Amounts drawn pursuant to a Final Drawing shall be
maintained and invested in accordance with Section 3.06(f).
(j) Reduction of Stated Amount. Promptly following each
date on which the Required Amount of the Liquidity Facility for a
Class of Certificates is reduced as a result of a reduction in the
Pool Balance with respect to such Certificates, the Subordination
Agent shall, if any such Liquidity Facility provides for reductions of
the Stated Amount of such Liquidity Facility and if such reductions
are not automatic, request such Liquidity Provider for such Class of
Certificates to reduce such Stated Amount to an amount equal to the
Required Amount with respect to such Liquidity Facility (as calculated
by the Subordination Agent after giving effect to such payment). Each
such request shall be made in accordance with the provisions of the
applicable Liquidity Facility.
(k) Relation to Subordination Provisions. Interest
Drawings under the Liquidity Facilities and withdrawals from the Cash
Collateral Accounts, in each case, in respect of interest on the
Certificates of any Class, will be distributed to the Trustee for such
Class of Certificates, notwithstanding Sections 2.04(b), 3.02, 3.03
and 3.06.
(l) Assignment of Liquidity Facility. The Subordination
Agent agrees not to consent to the assignment by any Liquidity
Provider of any of its rights or obligations under any Liquidity
Facility or any interest therein unless (i) Delta shall have consented
to such assignment and (ii) each Rating Agency shall have provided a
Ratings Confirmation in respect of such assignment.
ARTICLE IV
EXERCISE OF REMEDIES
Section 4.01. Directions from the Controlling Party. (a)
(i) Following the occurrence and during the continuation of an Indenture Event
of Default under any Indenture, the Controlling Party shall direct the
Subordination Agent, which in turn shall direct the Loan Trustee under such
Indenture, in the exercise of remedies available to the holders of the
Equipment Notes issued pursuant to such Indenture, including, without
limitation, the ability to vote all such Equipment Notes in favor of
Accelerating such Equipment Notes in accordance with the provisions of such
Indenture. If the Equipment Notes issued pursuant to any Indenture have been
Accelerated following an Indenture Event of Default with respect thereto, the
Controlling Party may direct the Subordination Agent to sell, assign, contract
to sell or otherwise dispose of and deliver all (but not less than all) of such
Equipment Notes to any Person at public or private sale, at any location at the
option of the Controlling Party, all upon such terms and conditions as it may
reasonably deem advisable and in accordance with applicable law.
(ii) So long as any Certificates remain Outstanding,
during the period ending on the date which is nine months after the earlier of
(x) the Acceleration of the Equipment Notes
42
46
issued pursuant to any Indenture or (y) the occurrence of a Delta Bankruptcy
Event, without the consent of each Trustee, no Aircraft subject to the Lien of
such Indenture or such Equipment Notes may be sold if the net proceeds from
such sale would be less than the Minimum Sale Price for such Aircraft or such
Equipment Notes.
(iii) At the request of the Controlling Party, the
Subordination Agent may from time to time during the continuance of an
Indenture Event of Default (and before the occurrence of a Triggering Event)
commission an LTV Appraisal with respect to the Aircraft subject to such
Indenture.
(iv) After a Triggering Event occurs and any Equipment
Note becomes a Non-Performing Equipment Note, the Subordination Agent shall
obtain Appraisals with respect to all of the Aircraft (the "LTV Appraisals") as
soon as practicable and additional LTV Appraisals on or prior to each
anniversary of the date of such initial LTV Appraisals; provided that, if the
Controlling Party reasonably objects to the appraised value of the Aircraft
shown in such LTV Appraisals, the Controlling Party shall have the right to
obtain or cause to be obtained substitute LTV Appraisals (including any LTV
Appraisals based upon physical inspection of the Aircraft).
(b) To the extent permitted by applicable law, the
Subordination Agent, at the direction of the Controlling Party, shall take such
actions as it may reasonably deem most effectual to complete the sale or other
disposition of such Aircraft or Equipment Notes. In addition, in lieu of any
sale, assignment, contract to sell or other disposition, if the Subordination
Agent is so directed by the Controlling Party, the Subordination Agent may
maintain possession of such Equipment Notes and continue to apply monies
received in respect of such Equipment Notes in accordance with Section 2.04(b)
and Article III. In addition, in lieu of such sale, assignment, contract to
sell or other disposition, or in lieu of such maintenance of possession, the
Controlling Party may direct the Subordination Agent to, subject to the terms
and conditions of the related Indenture, instruct the Loan Trustee under such
Indenture to foreclose on the Lien on the related Aircraft or take any other
remedial action permitted by such Indenture or applicable law.
Section 4.02. Remedies Cumulative. Each and every right,
power and remedy given to the Trustees, the Liquidity Providers, the
Controlling Party or the Subordination Agent specifically or otherwise in this
Agreement shall be cumulative and shall be in addition to every other right,
power and remedy herein specifically given or now or hereafter existing at law,
in equity or by statute, and each and every right, power and remedy whether
specifically herein given or otherwise existing may, subject always to the
terms and conditions hereof, be exercised from time to time and as often and in
such order as may be deemed expedient by any Trustee, any Liquidity Provider,
the Controlling Party or the Subordination Agent, as appropriate, and the
exercise or the beginning of the exercise of any right, power or remedy shall
not be construed to be a waiver of the right to exercise at the same time or
thereafter any other right, power or remedy. No delay or omission by any
Trustee, any Liquidity Provider, the Controlling Party or the Subordination
Agent in the exercise of any right, remedy or power or in the pursuit of any
remedy shall impair any such right, power or remedy or be construed to be a
waiver of any default or to be an acquiescence therein.
43
47
Section 4.03. Discontinuance of Proceedings. In case any
party to this Agreement (including the Controlling Party in such capacity)
shall have instituted any Proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, entry or otherwise, and such Proceeding
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Person instituting such Proceeding, then and in
every such case each such party shall, subject to any determination in such
Proceeding, be restored to its former position and rights hereunder, and all
rights, remedies and powers of such party shall continue as if no such
Proceeding had been instituted.
Section 4.04. Right of Certificateholders to Receive
Payments Not to Be Impaired. Subject to the provisions of this Agreement and
each Trust Agreement, the right of any Certificateholder or any Liquidity
Provider, respectively, to receive payments hereunder (including, without
limitation, pursuant to Section 2.04, 3.02 or 3.03) when due, or to institute
suit for the enforcement of any such payment on or after the applicable
Distribution Date, shall not be impaired or affected without the consent of
such Certificateholder or such Liquidity Provider, respectively.
ARTICLE V
DUTIES OF THE SUBORDINATION AGENT;
AGREEMENTS OF TRUSTEES, ETC.
Section 5.01. Notice of Indenture Event of Default or
Triggering Event. (a) If the Subordination Agent shall have knowledge of an
Indenture Event of Default or a Triggering Event, the Subordination Agent shall
promptly give notice thereof to the Rating Agencies, Delta, the Liquidity
Providers and the Trustees by telegram, cable, facsimile or telephone (to be
promptly confirmed in writing), unless such Indenture Event of Default or
Triggering Event shall have been cured or waived. For all purposes of this
Agreement, in the absence of actual knowledge, the Subordination Agent shall
not be deemed to have knowledge of any Indenture Event of Default or Triggering
Event unless notified in writing by Delta, one or more Trustees, one or more
Liquidity Providers or one or more Certificateholders; and "actual knowledge"
(as used in the foregoing clause) of the Subordination Agent shall mean actual
knowledge of an officer in the Corporate Trust Office of the Subordination
Agent.
(b) Other Notices. The Subordination Agent will furnish
to each Liquidity Provider and Trustee, promptly upon receipt thereof,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and other instruments furnished to the Subordination Agent
as registered holder of the Equipment Notes or otherwise in its capacity as
Subordination Agent to the extent the same shall not have been otherwise
directly distributed to such Liquidity Provider or Trustee, as applicable,
pursuant to any other Operative Agreement.
Section 5.02. Indemnification. The Subordination Agent
shall not be required to take any action or refrain from taking any action
under Article IV unless the Subordination Agent shall have received
indemnification against any risks incurred in connection therewith in form and
substance reasonably satisfactory to it, including, without limitation,
adequate advances against costs that may be incurred by it in connection
therewith. The Subordination Agent shall not be required to take any action
under Article IV, nor shall any other provision of this
44
48
Agreement or any other Operative Agreement be deemed to impose a duty on the
Subordination Agent to take any action, if the Subordination Agent shall have
been advised by outside counsel that such action is contrary to the terms
hereof or is otherwise contrary to law.
Section 5.03. No Duties Except as Specified in
Intercreditor Agreement. The Subordination Agent shall not have any duty or
obligation to take or refrain from taking any action under, or in connection
with, this Agreement, except as expressly provided by the terms of this
Agreement; and no implied duties or obligations shall be read into this
Agreement against the Subordination Agent. The Subordination Agent agrees that
it will, in its individual capacity and at its own cost and expense (but
without any right of indemnity in respect of any such cost or expense) promptly
take such action as may be necessary duly to discharge all Liens on any of the
Trust Accounts or any monies deposited therein that are attributable to the
Subordination Agent in its individual capacity and that are unrelated to the
transaction contemplated hereby and by the other Operative Agreements.
Section 5.04. Notice from the Liquidity Providers and
Trustees. If any Liquidity Provider or Trustee has notice of an Indenture Event
of Default or a Triggering Event, such Person shall promptly give notice
thereof to all other Liquidity Providers and Trustees and to the Subordination
Agent; provided, however, that no such Person shall have any liability
hereunder as a result of its failure to deliver any such notice.
ARTICLE VI
THE SUBORDINATION AGENT
Section 6.01. Authorization; Acceptance of Trusts and
Duties. Each of the Class A-1 Trustee, the Class A-2 Trustee, the Class B
Trustee and the Class C Trustee hereby designates and appoints the
Subordination Agent as the agent and trustee of such Trustee under the
applicable Liquidity Facility and authorizes the Subordination Agent to enter
into the applicable Liquidity Facility as agent and trustee for such Trustee.
Each of the Liquidity Providers and the Trustees hereby designates and appoints
the Subordination Agent as the Subordination Agent under this Agreement. State
Street accepts the trusts and duties hereby created and applicable to it and
agrees to perform such duties, but only upon the terms of this Agreement and
agrees to receive, handle and disburse all monies received by it in accordance
with the terms hereof. The Subordination Agent shall have no liability
hereunder except (a) for its own willful misconduct or negligence, (b) as
provided in Section 2.02 and the last sentence of Section 5.03, (c) for
liabilities that may result from the inaccuracy of any representation or
warranty of the Subordination Agent made in its individual capacity in any
Operative Agreement and (d) as otherwise expressly provided herein or in the
other Operative Agreements.
Section 6.02. Absence of Duties. The Subordination Agent
shall have no duty to see to any recording or filing of this Agreement or any
other document, or to see to the maintenance of any such recording or filing.
Section 6.03. No Representations or Warranties as to
Documents. The Subordination Agent shall not be deemed to have made any
representation or warranty as to the validity, legality or enforceability of
this Agreement or any other Operative Agreement or as to
45
49
the correctness of any statement contained herein or therein (other than the
representations and warranties of the Subordination Agent made in its
individual capacity under any Operative Agreement), except that the
Subordination Agent hereby represents and warrants that each of said specified
documents to which it is a party has been or will be duly executed and
delivered by one of its officers who is and will be duly authorized to execute
and deliver such document on its behalf. The Certificateholders, the Trustees
and the Liquidity Providers make no representation or warranty hereunder
whatsoever.
Section 6.04. No Segregation of Monies; No Interest. Any
monies paid to or retained by the Subordination Agent pursuant to any provision
hereof and not then required to be distributed to any Trustee or any Liquidity
Provider as provided in Articles II and III or deposited into one or more Trust
Accounts need not be segregated in any manner except to the extent required by
such Articles II and III and by law, and the Subordination Agent shall not
(except as otherwise provided in Section 2.02) be liable for any interest
thereon; provided, however, that any payments received or applied hereunder by
the Subordination Agent shall be accounted for by the Subordination Agent so
that any portion thereof paid or applied pursuant hereto shall be identifiable
as to the source thereof.
Section 6.05. Reliance; Agents; Advice of Counsel. The
Subordination Agent shall not incur any liability to anyone in acting upon any
signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper believed by it to
be genuine and believed by it to be signed by the proper party or parties. As
to the Pool Balance of any Trust as of any date, the Subordination Agent may
for all purposes hereof rely on a certificate signed by any Responsible Officer
of the applicable Trustee, and such certificate shall constitute full
protection to the Subordination Agent for any action taken or omitted to be
taken by it in good faith in reliance thereon. As to any fact or matter
relating to the Liquidity Providers or the Trustees the manner of ascertainment
of which is not specifically described herein, the Subordination Agent may for
all purposes hereof rely on a certificate, signed by any Responsible Officer of
the applicable Liquidity Provider or Trustee, as the case may be, as to such
fact or matter, and such certificate shall constitute full protection to the
Subordination Agent for any action taken or omitted to be taken by it in good
faith in reliance thereon. In the administration of the trusts hereunder, the
Subordination Agent may (a) execute any of the trusts or powers hereof and
perform its powers and duties hereunder directly or through agents or attorneys
and (b) consult with counsel, accountants and other skilled Persons to be
selected and retained by it. The Subordination Agent shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with the
advice or opinion of any such counsel, accountants or other skilled Persons
acting within such counsel's, accountants' or Person's area of competence (so
long as the Subordination Agent shall have exercised reasonable care and
judgment in selecting such Persons).
Section 6.06. Capacity in Which Acting. The Subordination
Agent acts hereunder solely as agent and trustee herein and not in its
individual capacity, except as otherwise expressly provided in the Operative
Agreements.
Section 6.07. Compensation. The Subordination Agent shall be
entitled to such compensation, including reasonable expenses and disbursements,
for all services rendered hereunder as Delta and the Subordination Agent may
agree from time to time in writing and shall
46
50
have a priority claim to the extent set forth in Article III on all monies
collected hereunder for the payment of such compensation, to the extent that
such compensation shall not be paid by others. The Subordination Agent agrees
that it shall have no right against any Trustee or Liquidity Provider for any
fee as compensation for its services as agent under this Agreement. The
provisions of this Section 6.07 shall survive the termination of this
Agreement.
Section 6.08. May Become Certificateholder. The
institution acting as Subordination Agent hereunder may become a
Certificateholder and have all rights and benefits of a Certificateholder to
the same extent as if it were not the institution acting as the Subordination
Agent.
Section 6.09. Subordination Agent Required; Eligibility.
There shall at all times be a Subordination Agent hereunder that is a Citizen
of the United States, a bank, trust company or other financial institution
organized and doing business under the laws of the United States or any state
thereof and eligible to act as a trustee under Section 310(a) of the Trust
Indenture Act of 1939, as amended, and that has 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
under the laws of the United States or any State or territory thereof or the
District of Columbia and having a combined capital and surplus of at least
$75,000,000). If such bank, trust company or other financial institution or
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 6.09 the combined capital and surplus of such bank, trust company or
other financial institution or 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 Subordination Agent shall cease to be
eligible in accordance with the provisions of this Section 6.09, the
Subordination Agent shall resign immediately in the manner and with the effect
specified in Section 7.01.
Section 6.10. Money to Be Held in Trust. All Equipment
Notes, monies and other property deposited with or held by the Subordination
Agent pursuant to this Agreement shall be held in trust for the benefit of the
parties entitled to such Equipment Notes, monies and other property.
ARTICLE VII
SUCCESSOR SUBORDINATION AGENT
Section 7.01. Replacement of Subordination Agent;
Appointment of Successor. (a) The Subordination Agent or any successor thereto
must resign if at any time it fails to comply with Section 6.09 and may resign
at any time without cause by giving 60 days' prior written notice to Delta ,
the Trustees and the Liquidity Providers. The Controlling Party (or the party
that would be the Controlling Party if an Indenture Event of Default had
occurred) shall remove the Subordination Agent if:
47
51
(1) the Subordination Agent fails to comply with Section
6.09;
(2) the Subordination Agent is adjudged bankrupt or
insolvent or files a bankruptcy petition;
(3) a receiver of the Subordination Agent shall be
appointed or any public officer shall take charge or control of the
Subordination Agent or its property or affairs for the purpose of
rehabilitation, conservation or liquidation; or
(4) the Subordination Agent otherwise becomes incapable
of acting.
If the Subordination Agent resigns or is removed or if a
vacancy exists in the office of Subordination Agent for any reason (the
Subordination Agent in such event being referred to herein as the retiring
Subordination Agent), the Controlling Party (or the party that would be the
Controlling Party if an Indenture Event of Default had occurred) shall promptly
appoint a successor Subordination Agent. If a successor Subordination Agent
shall not have been appointed within 60 days after such notice of resignation or
removal, the retiring Subordination Agent, one or more of the Trustees or one or
more of the Liquidity Providers may petition any court of competent jurisdiction
for the appointment of a successor Subordination Agent to act until such time,
if any, as a successor shall have been appointed as provided above.
A successor Subordination Agent shall deliver (x) a written
acceptance of its appointment as Subordination Agent hereunder to the retiring
Subordination Agent and (y) a written assumption of its obligations hereunder
and under each Liquidity Facility to each party hereto, upon which the
resignation or removal of the retiring Subordination Agent shall become
effective, and the successor Subordination Agent shall have all the rights,
powers and duties of the Subordination Agent under this Agreement. The successor
Subordination Agent shall mail a notice of its succession to the Liquidity
Providers and the Trustees. The retiring Subordination Agent shall promptly
transfer its rights under each of the Liquidity Facilities and all of the
property and all books and records, or true, complete and correct copies
thereof, held by it as Subordination Agent to the successor Subordination Agent.
If the Subordination Agent fails to comply with Section 6.09
(to the extent applicable), one or more of the Trustees or one or more of the
Liquidity Providers may petition a court of competent jurisdiction for the
removal of the Subordination Agent and the appointment of a successor
Subordination Agent.
Notwithstanding the foregoing, no resignation or removal of
the Subordination Agent shall be effective unless and until a successor has been
appointed. No appointment of a successor Subordination Agent shall be effective
unless and until the Rating Agencies shall have delivered a Ratings
Confirmation.
(b) Any corporation into which the Subordination Agent
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
Subordination Agent shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of the Subordination Agent,
shall be the successor of the Subordination Agent hereunder, provided that
48
52
such corporation shall be otherwise qualified and eligible under Section 6.09,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
ARTICLE VIII
SUPPLEMENTS AND AMENDMENTS
Section 8.01. Amendments, Waivers, Etc. (a) This Agreement
may not be supplemented, amended or modified without the consent of each
Trustee (acting, except in the case of any amendment pursuant to Section
3.06(e)(v)(y) or any amendment contemplated by the last sentence of this
Section 8.01(a), with the consent of holders of Certificates of the related
Class evidencing Fractional Undivided Interests in the related Trust
aggregating not less than a majority in interest in such Trust or as otherwise
authorized pursuant to the relevant Trust Agreement (including, without
limitation, without the consent of the Certificateholders to the extent
permitted thereby, Section 9.01 of the Basic Agreement)), the Subordination
Agent and each Liquidity Provider; provided, however, that this Agreement may
be supplemented, amended or modified without the consent of any Trustee in
order (i) to cure any ambiguity or omission or to correct any mistake, (ii) to
correct or supplement any provision, or (iii) to make any other provision in
regard to matters or questions arising hereunder that will not materially
adversely affect the interests of any Trustee or the holders of the related
Class of Certificates, and without the consent of any Liquidity Provider if
such supplement, amendment or modification is in accordance with Section
8.01(c); provided further, however, that, if such supplement, amendment or
modification (x) would directly or indirectly amend, modify or supersede, or
otherwise conflict with, Section 2.02(b), 3.06(c), 3.06(e), 3.06(f)(other than
the last sentence thereof), 3.06(l), this proviso of 8.01(a), the last sentence
of 8.01(a), 8.01(c) or 9.06 (collectively, the "Delta Provisions"), (y) would
otherwise affect the interests of a potential Replacement Liquidity Provider or
of Delta with respect to its ability to replace any Liquidity Facility or with
respect to its payment obligations under any Operative Agreement or (z) is made
pursuant to the last sentence of this Section 8.01(a) or pursuant to Section
8.01(c), then such supplement, amendment or modification shall not be effective
without the additional written consent of Delta. Notwithstanding the foregoing,
without the consent of each Certificateholder affected thereby and each
Liquidity Provider, no supplement, amendment or modification of this Agreement
may (i) reduce the percentage of the interest in any Trust evidenced by the
Certificates issued by such Trust necessary to consent to modify or amend any
provision of this Agreement or to waive compliance therewith or (ii), except as
provided in the last sentence of this Section 8.01(a), modify Section 2.04,
3.02 or 3.03 hereof relating to the distribution of monies received by the
Subordination Agent hereunder from the Equipment Notes or pursuant to the
Liquidity Facilities. Nothing contained in this Section 8.01(a) shall require
the consent of a Trustee at any time following the payment of Final
Distributions with respect to the related Class of Certificates. If the
Replacement Liquidity Facility for any Liquidity Facility is to be comprised of
more than one instrument as contemplated by the definition of the term
"Replacement Liquidity Facility", then each party hereto agrees to amend this
Agreement and the other Operative Agreements to incorporate appropriate
mechanics for multiple Liquidity Facilities for a single Trust.
(b) Subject to Section 2.06, if the Subordination Agent,
as the registered holder of any Equipment Notes, receives a request for its
consent to any amendment, modification, consent or waiver under such Equipment
Notes, the Indenture pursuant to which
49
53
such Equipment Notes were issued or the related Participation Agreement or
other related document, (i) if no Indenture Event of Default shall have
occurred and be continuing with respect to such Indenture, the Subordination
Agent shall request directions with respect to each series of such Equipment
Notes from the Trustee of the Trust which holds such Equipment Notes and shall
vote or consent in accordance with the directions of such Trustee and (ii) if
any Indenture Event of Default shall have occurred and be continuing with
respect to such Indenture, the Subordination Agent will exercise its voting
rights as directed by the Controlling Party, subject to Section 4.01 and 4.04;
provided that no such amendment, modification, consent or waiver shall, without
the consent of each Liquidity Provider, reduce the amount of principal or
interest payable by Delta under any Equipment Note.
(c) If Class D Certificates are issued, this Agreement
shall be amended by written agreement of the Subordination Agent and the
Trustees to provide for the subordination of such Class D Certificates to the
Class A-1 Certificates, the Class A-2 Certificates, the Class B Certificates
and the Class C Certificates substantially in the same manner as the Class C
Certificates are subordinated hereunder to the Class A-1 Certificates, the
Class A-2 Certificates and the Class B Certificates. No such amendment shall
materially adversely affect any Trustee. The amendment to this Agreement to
give effect to the issuance of any Class D Certificates shall, without
limitation:
(i) add the Class D Trustee as a party to this Agreement;
(ii) revise the definitions of "Cash Collateral Account",
"Certificate", "Class", "Controlling Party", "Equipment Notes", "Final
Legal Distribution Date", "Liquidity Facility", "Liquidity Provider",
"LTV Ratio", "Stated Interest Rate", "Trust", "Trust Agreement" and
"Trustee", as appropriate, to reflect the issuance of the Class D
Certificates (and the subordination thereof); and
(iii) revise the provisions of this Agreement governing
payments with respect to Certificates and related notices, including,
without limitation, Sections 2.04, 3.01, 3.02, 3.03 and 3.06, if
necessary, to provide for distributions on the Class D Certificates
after payment of all relevant distributions on the Class C
Certificates.
If, with respect to any Aircraft, Series D Equipment Notes are issued to any
Person other than the Class D Trust, this Agreement shall be amended by written
agreement of the indenture trustees of the equipment notes held by the Class D
Trust, the Trustees and the Subordination Agent to (i) provide for each holder
of a Series D Equipment Note to be bound by the provisions of Section 2.06(a) so
that the Controlling Party, among other things, shall be entitled to direct the
Loan Trustee under the applicable Indenture as provided in such Section 2.06(a)
(and such Series D Equipment Notes shall make effective provision therefor so as
to bind each holder thereof to such provisions of Section 2.06(a)) and (ii) to
revise the definitions of "Controlling Party" and "Equipment Notes", as
appropriate, to reflect the issuance of the Series D Equipment Notes (and the
prior rights, as against the holders of such Series D Equipment Notes, of the
Class A-1 Trustee, the Class A-2 Trustee, the Class B Trustee and the Class C
Trustee to be such "Controlling Party"). No such amendment shall materially
adversely affect any Trustee.
50
54
Section 8.02. Subordination Agent Protected. If, in the
reasonable opinion of the institution acting as the Subordination Agent
hereunder, any document required to be executed by it pursuant to the terms of
Section 8.01 adversely affects any right, duty, immunity or indemnity with
respect to such institution under this Agreement or any Liquidity Facility, the
Subordination Agent may in its discretion decline to execute such document.
Section 8.03. Effect of Supplemental Agreements. Upon the
execution of any amendment, consent or supplement hereto pursuant to the
provisions hereof, this Agreement shall be and shall be deemed to be modified
and amended in accordance therewith and the respective rights, limitations of
rights, obligations, duties and immunities under this Agreement of the parties
hereto and beneficiaries hereof shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and
amendments, and all the terms and conditions of any such supplemental agreement
shall be and be deemed to be part of the terms and conditions of this Agreement
for any and all purposes. In executing or accepting any supplemental agreement
permitted by this Article VIII, the Subordination Agent 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 8.04. Notice to Rating Agencies. Promptly
following its receipt of each amendment, consent, modification, supplement or
waiver contemplated by this Article VIII, the Subordination Agent shall send a
copy thereof to each Rating Agency.
ARTICLE IX
MISCELLANEOUS
Section 9.01. Termination of Intercreditor Agreement. Upon
(or at any time after) payment of Final Distributions with respect to each
Class of Certificates and the payment in full of all Liquidity Obligations to
the Liquidity Providers and provided that there shall then be no other amounts
due to the Certificateholders, the Trustees, the Liquidity Providers and the
Subordination Agent hereunder or under the Trust Agreements, and that the
commitment of the Liquidity Providers under the Liquidity Facilities shall have
expired or been terminated, this Agreement shall terminate and shall be of no
further force or effect. Except as aforesaid or otherwise provided, this
Agreement and the trusts created hereby shall continue in full force and effect
in accordance with the terms hereof.
Section 9.02. Intercreditor Agreement for Benefit of
Trustees, Liquidity Providers and Subordination Agent. Subject to the second
sentence of Section 9.06 and the provisions of Section 4.04, nothing in this
Agreement, whether express or implied, shall be construed to give to any Person
other than the Trustees, the Liquidity Providers and the Subordination Agent
any legal or equitable right, remedy or claim under or in respect of this
Agreement.
Section 9.03. Notices. Unless otherwise expressly
specified or permitted by the terms hereof, all notices required or permitted
under the terms and provisions of this Agreement shall be in English and in
writing, and any such notice may be given by United States mail, courier
service or facsimile or any other customary means of communication, and any
such
51
55
notice shall be effective when delivered (or, if mailed, three Business Days
after deposit, postage prepaid, in the first class United States mail and, if
delivered by facsimile, upon completion of transmission and confirmation by the
sender (by a telephone call to a representative of the recipient or by machine
confirmation) that such transmission was received),
if to the Subordination Agent, to:
State Street Bank and Trust Company of Connecticut,
National Association
000 Xxxxxx Xxxxxx
Xxxxxxx Square
Hartford, Connecticut 06103
Attention: Corporate Trust Division
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to any Trustee, to:
State Street Bank and Trust Company of Connecticut,
National Association
000 Xxxxxx Xxxxxx
Xxxxxxx Square
Hartford, Connecticut 06103
Attention: Corporate Trust Division
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Liquidity Provider, to:
Westdeutsche Landesbank Girozentrale, New York Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Westdeutsche Landesbank Girozentrale
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Loan Administration
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
52
56
Any party, by notice to the other parties hereto, may
designate additional or different addresses for subsequent notices or
communications. Whenever the words "notice" or "notify" or similar words are
used herein, they mean the provision of formal notice as set forth in this
Section 9.03.
Section 9.04. Severability. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
Section 9.05. No Oral Modifications or Continuing Waivers.
No terms or provisions of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party or
other Person against whom enforcement of the change, waiver, discharge or
termination is sought and any other party or other Person whose consent is
required pursuant to this Agreement and any waiver of the terms hereof shall be
effective only in the specific instance and for the specific purpose given.
Section 9.06. Successors and Assigns. All covenants and
agreements contained herein shall bind and inure to the benefit of, and be
enforceable by, each of the parties hereto and the successors and permitted
assigns of each, all as herein provided. In addition, the Delta Provisions
shall inure to the benefit of Delta and its successors and permitted assigns,
and (without limitation of the foregoing) Delta is hereby constituted, and
agreed to be, an express third party beneficiary of the Delta Provisions.
Section 9.07. Headings. The headings of the various
Articles and Sections herein and in the Table of Contents hereto are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
Section 9.08. Counterparts. This Agreement may be executed
in any number of counterparts (and each party shall not be required to execute
the same counterpart). Each counterpart of this Agreement including a signature
page or pages executed by each of the parties hereto shall be an original
counterpart of this Agreement, but all of such counterparts together constitute
one instrument.
Section 9.09. Subordination. (a) As among the Trustees,
and as between the Liquidity Providers, on the one hand, and the Trustees and
the Certificateholders, on the other hand, this Agreement shall be a
subordination agreement for purposes of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx
Bankruptcy Code, as amended from time to time. In addition, as among the
Trustees and the Certificateholders of each Class, this Agreement shall be a
subordination agreement for purposes of such Section 510.
(b) Notwithstanding the provisions of this Agreement, if
prior to the payment in full to the Liquidity Providers of all Liquidity
Obligations then due and payable or prior to the distribution in full of any
other amount distributable hereunder, any party hereto shall have received any
payment or distribution in respect of Equipment Notes or any other amount under
the Indentures or other Operative Agreements which, had the subordination
provisions of this
53
57
Agreement been properly applied to such payment, distribution or other amount,
would not have been distributed to such Person, then such payment, distribution
or other amount shall be received and held in trust by such Person and paid
over or delivered to the Subordination Agent for application as provided
herein.
(c) If any Trustee, any Liquidity Provider or the
Subordination Agent receives any payment in respect of any obligations owing or
amounts distributable hereunder (or, in the case of the Liquidity Providers, in
respect of the Liquidity Obligations), which is subsequently invalidated,
declared preferential, set aside and/or required to be repaid to a trustee,
receiver or other party, then, to the extent of such payment, such obligations
or amounts (or, in the case of the Liquidity Providers, such Liquidity
Obligations) intended to be satisfied shall be revived and continue in full
force and effect as if such payment had not been received.
(d) The Trustees (on behalf of themselves and the holders
of Certificates), the Liquidity Providers and the Subordination Agent expressly
confirm and agree that the payment priorities and subordination specified in
Articles II and III shall apply in all circumstances, notwithstanding (x) the
fact that the obligations owed to the Trustees are secured by certain assets
and the Liquidity Obligations are not so secured and (y) the occurrence of a
Delta Bankruptcy Event or any similar event or occurrence relating to any other
Person (it being expressly agreed that the payment priorities and subordination
specified in Articles II and III shall apply whether or not a claim for
post-petition or post-filing interest is allowed in the proceedings resulting
from such Delta Bankruptcy Event or other event or occurrence). The Trustees
expressly agree (on behalf of themselves and the holders of Certificates) not
to assert priority over the holders of Liquidity Obligations due to their
status as secured creditors in any bankruptcy, insolvency or other legal
proceeding.
(e) Each of the Trustees (on behalf of themselves and the
holders of Certificates), the Liquidity Providers and the Subordination Agent
may take any of the following actions without impairing its rights under this
Agreement:
(i) obtain a Lien on any property to secure any amounts
owing to it hereunder, including, in the case of the Liquidity
Providers, the Liquidity Obligations;
(ii) obtain the primary or secondary obligation of any
other obligor with respect to any amounts owing to it hereunder,
including, in the case of the Liquidity Providers, any of the
Liquidity Obligations;
(iii) renew, extend, increase, alter or exchange any
amounts owing to it hereunder, including, in the case of the Liquidity
Providers, any of the Liquidity Obligations, or release or compromise
any obligation of any obligor with respect thereto;
(iv) refrain from exercising any right or remedy, or delay
in exercising any right or remedy, which it may have; or
(v) take any other action which might discharge a
subordinated party or a surety under applicable law;
54
58
provided, however, that the taking of any such actions by any of the Trustees,
the Liquidity Providers or the Subordination Agent shall not prejudice the
rights or adversely affect the obligations of any other party under this
Agreement.
Section 9.10. Governing Law. THIS AGREEMENT HAS BEEN
DELIVERED IN THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
Section 9.11. Submission to Jurisdiction; Waiver of Jury
Trial; Waiver of Immunity. (a) Each of the parties hereto, to the extent it may
do so under applicable law, for purposes hereof and of all other Operative
Agreements hereby (a) irrevocably submits itself to the non-exclusive
jurisdiction of the courts of the State of New York sitting in the City of New
York and to the non-exclusive jurisdiction of the United States District Court
for the Southern District of New York, for the purposes of any suit, action or
other proceeding arising out of this Agreement, the subject matter hereof or
any of the transactions contemplated hereby brought by any party or parties
hereto or thereto, or their successors or permitted assigns and (b) waives, and
agrees not to assert, by way of motion, as a defense, or otherwise, in any such
suit, action or proceeding, that the suit, action or proceeding is brought in
an inconvenient forum, that the venue of the suit, action or proceeding is
improper or that this Agreement or the subject matter hereof or any of the
transactions contemplated hereby may not be enforced in or by such courts.
(b) EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE
SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS BEING
ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. Each of
the parties warrants and represents that it has reviewed this waiver with its
legal counsel, and that it knowingly and voluntarily waives its jury trial
rights following consultation with such legal counsel. THIS WAIVER IS
IRREVOCABLE AND CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT.
(c) Each Liquidity Provider hereby waives any immunity it
may have from the jurisdiction of the courts of the United States or of any
state thereof and waives any immunity any of its properties located in the
United States may have from attachment or execution upon a judgment entered by
any such court under the United States Foreign Sovereign Immunities Act of 1976
or any similar successor legislation.
55
59
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, as of the date first above written.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee for each of the Trusts
By:
-------------------------------------------------
Name:
Title:
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, New York Branch,
as Class A-1 Liquidity Provider,
Class A-2 Liquidity Provider,
Class B Liquidity Provider and
Class C Liquidity Provider
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
as Subordination Agent
By:
-------------------------------------------------
Name:
Title:
56