EXHIBIT 10.9
Execution Version
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LOAN AGREEMENT [SPARE PARTS]
DATED AS OF SEPTEMBER 3, 2004
AMONG
AMERICA WEST AIRLINES, INC.,
GENERAL ELECTRIC CAPITAL CORPORATION,
AS ADMINISTRATIVE AGENT
GENERAL ELECTRIC CAPITAL CORPORATION,
AS ORIGINAL SERIES A LENDER,
GENERAL ELECTRIC CAPITAL CORPORATION
AS ORIGINAL SERIES B LENDER
XXXXX FARGO BANK NORTHWEST, NATIONAL ASSOCIATION
AS SECURITY TRUSTEE
AND
THE LENDERS
FROM TIME TO TIME PARTY HERETO
TABLE OF CONTENTS
PAGE
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ARTICLE I THE LOAN....................................................................................... 1
Section 1.1. The Loan........................................................................... 1
Section 1.2. Making the Loan.................................................................... 3
Section 1.3. Fees............................................................................... 4
Section 1.4. Commitment Termination............................................................. 4
Section 1.5. [Intentionally omitted.]........................................................... 4
Section 1.6. Substitute Lenders................................................................. 4
Section 1.7. Special Provisions Governing the Loan.............................................. 5
Section 1.8. Payments and Computations.......................................................... 7
Section 1.9. Sharing of Payments, Etc. ......................................................... 8
Section 1.10. Obligation of Lenders to Mitigate................................................. 8
Section 1.11. Replacement Notes................................................................. 8
ARTICLE II INTEREST...................................................................................... 8
Section 2.1. Rate of Interest................................................................... 8
Section 2.2. Interest Periods................................................................... 9
(a) Interest Periods................................................................. 9
(b) Expiration of Interest Periods................................................... 9
Section 2.3. Interest Payments.................................................................. 9
Section 2.4. Default Rate....................................................................... 9
Section 2.5. Computation of Interest............................................................ 9
Section 2.6. Maximum Rate....................................................................... 9
ARTICLE III REPRESENTATIONS AND WARRANTIES............................................................... 10
Section 3.1. Representations and Warranties..................................................... 10
(a) Organization; Powers............................................................. 10
(b) Authorization; Enforceability.................................................... 10
(c) No Violation..................................................................... 10
(d) Governmental Approvals........................................................... 10
(e) Litigation....................................................................... 11
(f) Financial Condition.............................................................. 11
(g) No Default....................................................................... 11
(h) Investment and Holding Company Status............................................ 11
(i) Use of Proceeds.................................................................. 12
(j) Licenses, Permits, etc. ......................................................... 12
(k) Compliance with Laws............................................................. 12
(l) Tax Returns...................................................................... 12
(m) Information...................................................................... 12
Section 3.2. The Pledged Spare Parts............................................................ 12
(a) Good Title....................................................................... 12
(b) Filings.......................................................................... 13
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TABLE OF CONTENTS
(CONTINUED)
(c) [Intentionally Omitted].......................................................... 13
(d) Section 1110..................................................................... 13
(e) Conditions....................................................................... 13
(f) Location, Identification and Release of Pledged Spare Parts...................... 13
(g) Software......................................................................... 13
(h) Records.......................................................................... 13
(i) Spare Parts...................................................................... 13
Section 3.3. Representations and Warranties of the Security Trustee............................. 14
(a) Powers and Authorizations........................................................ 14
(b) Litigation....................................................................... 14
(c) No Legal Bar..................................................................... 14
Section 3.4. Representations and Warranties of the Lenders...................................... 14
(a) Accredited Investor.............................................................. 14
(b) Investment Intent................................................................ 15
(c) ERISA............................................................................ 15
(d) No Offering...................................................................... 15
ARTICLE IV COVENANTS..................................................................................... 15
Section 4.1. Covenants of the Borrower.......................................................... 15
(a) Financial Statements and Other Information....................................... 15
(b) Existence; Conduct of Business................................................... 16
(c) Mergers and Consolidations....................................................... 17
(d) Delivery of Post-Recording FAA Opinion........................................... 18
(e) Software......................................................................... 18
(f) Compliance with Mortgage......................................................... 18
ARTICLE V INCREASED COSTS; GENERAL INDEMNITY............................................................. 18
Section 5.1. Increased Costs.................................................................... 18
Section 5.2. Capital Adequacy................................................................... 19
Section 5.3. Withholding of Taxes............................................................... 20
(a) Payments to Be Free and Clear..................................................... 20
(b) Grossing-up of Payments........................................................... 21
(c) Evidence of Exemption from U.S. Withholding Tax................................... 22
Section 5.4. (a) Other Taxes................................................................ 24
Section 5.4. (b) Contest of Tax Claims...................................................... 25
(c) Non-Parties................................................................ 26
Section 5.5. Indemnity.......................................................................... 26
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TABLE OF CONTENTS
(CONTINUED)
ARTICLE VI CONDITIONS PRECEDENT.......................................................................... 28
Section 6.1. General Conditions................................................................. 28
Section 6.2. Additional Conditions.............................................................. 28
ARTICLE VII EVENTS OF DEFAULT............................................................................ 32
Section 7.1. Events of Default.................................................................. 32
ARTICLE VIII THE TRANSACTION AGENTS...................................................................... 34
Section 8.1. Appointment and Authorization...................................................... 34
Section 8.2. Delegation of Duties............................................................... 34
Section 8.3. Exculpatory Provisions............................................................. 34
Section 8.4. Reliance by Transaction Agents..................................................... 34
Section 8.5. Notice of Events of Default........................................................ 35
Section 8.6. Non-Reliance on Transaction Agents and Other Lenders; Lender
Representations................................................................ 35
Section 8.7. Transaction Agents and Affiliates.................................................. 35
Section 8.8. Indemnification.................................................................... 35
Section 8.9. Successor Transaction Agents....................................................... 36
Section 8.10. Qualifications of Successor Security Trustee....................................... 36
ARTICLE IX MISCELLANEOUS................................................................................. 36
Section 9.1. Amendments......................................................................... 36
Section 9.2. Notices............................................................................ 37
Section 9.3. Costs and Expenses................................................................. 37
Section 9.4. Certain Agreements................................................................. 37
Section 9.5. Entire Agreement................................................................... 37
Section 9.6. Cumulative Rights and Severability................................................. 38
Section 9.7. Waivers............................................................................ 38
Section 9.8. Successors and Assigns; Participations; Assignments................................ 38
(a) Successors and Assigns........................................................... 38
(b) Participations................................................................... 38
(c) Assignments...................................................................... 38
(d) Register......................................................................... 39
Section 9.9. Confidentiality.................................................................... 39
Section 9.10. Counterparts....................................................................... 40
Section 9.11. Governing Law; Submission to Jurisdiction; Venue................................... 40
Section 9.12. Waiver of Trial by Jury............................................................ 41
Section 9.13. Effective Date..................................................................... 41
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TABLE OF CONTENTS
(CONTINUED)
Schedule 1 Definitions
Schedule 2 Omitted
Schedule 3 Certain Information
EXHIBIT A-1 Form of Mortgage
EXHIBIT A-2 Form of Subordinated Mortgage
EXHIBIT B Form of Promissory Note
EXHIBIT C Form of Notice of Borrowing
EXHIBIT D Form of Opinion of Special Counsel to the Borrower for Closing
EXHIBIT E Form of Opinion of Borrower's Legal Department for Closing
EXHIBIT F Form of Transfer Supplement
EXHIBIT G Form of Certificate of Non-Bank Status
EXHIBIT H Form of FAA Counsel's Opinion
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LOAN AGREEMENT [SPARE PARTS]
THIS LOAN AGREEMENT [SPARE PARTS], dated as of September 3, 2004 (this
"Agreement"), is among AMERICA WEST AIRLINES, INC., a Delaware corporation (the
"Borrower"), GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as
Administrative Agent for the Lenders (the "Administrative Agent"), XXXXX FARGO
BANK NORTHWEST, National Association, as the Security Trustee (the "Security
Trustee"), GENERAL ELECTRIC CAPITAL CORPORATION (herein called the "Original
Series A Lender"), and GENERAL ELECTRIC CAPITAL CORPORATION (herein called the
"Original Series B Lender") and such other lenders as may from time to time be
party hereto (together with the Original Series A Lender and the Original Series
B Lender, the "Lenders"). Certain capitalized terms used herein are defined, and
certain rules of construction are specified, in Schedule 1.
BACKGROUND
l The Lenders have agreed to make loans to the Borrower to be secured by a
Lien on certain spare parts and related property owned by the Borrower and
stored at certain locations.
2 In connection with such loans, the parties hereto wish to enter into
certain related understandings, as set forth herein.
The parties hereto agree as follows:
ARTICLE I
THE LOAN
Section 1.1. The Loan.
(a) Commitments. Subject to the terms and conditions of this Loan
Agreement, on the Funding Date the Original Series A Lender shall make a loan to
the Borrower in the principal amount equal to the Series A Commitment, and the
Original Series B Lender shall make a loan to the Borrower in the principal
amount equal to the Series B Commitment. As evidence of the loan advanced by the
Original Series A Lender, on the Funding Date the Borrower shall issue and
deliver to the Original Series A Lender, as provided hereunder, a Series A Note
payable to the Original Series A Lender in an original principal amount equal to
the amount of its Series A Commitment. As evidence of the loan advanced by the
Original Series B Lender, on the Funding Date the Borrower shall issue and
deliver to the Original Series B Lender, as provided hereunder, a Series B Note
payable to the Original Series B Lender in an original principal amount equal to
the amount of the Series B Commitment. The Notes and the Security Trustee's form
of certificate of authentication to appear on the Notes shall each be
substantially in the form set forth in Exhibit B.
(b) The Notes: Amortization. An amount equal to one hundred percent (100%)
of the original principal amount of the Loan shall be payable on the Maturity
Date; provided that, in the event that the Notes shall have been prepaid in part
pursuant hereto (regardless of whether such prepayment is made pursuant to
subparagraphs (c) or (d) of this Section 1.1 or pursuant to
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Section 1.7), the amount of the Loan due on the Maturity Date shall be reduced
by the amount of such partial prepayment. In the case of each Note, each payment
of the principal amount, LIBOR Breakage Costs, if any, and interest or other
amounts due thereon shall be applied, first, to the payment of any amounts due
in respect of the Loan (other than principal and accrued interest on the Loan
and LIBOR Breakage Costs) to the date of such payment (including any interest on
overdue principal amount, LIBOR Breakage Costs, if any, and to the extent
permitted by law, interest and other amounts thereunder), second, to the payment
of accrued interest on the Loan to the date of such payment, third, to the
payment of LIBOR Breakage Costs, if any, due hereunder in respect of the Loan,
and fourth, the balance, if any, remaining thereafter, to the payment of the
principal amount of the Loan remaining unpaid (provided that the Loan shall not
be subject to prepayment, except as provided in Sections 1.1(c), 1.1(d) and 1.7
hereof).
(c) Optional Prepayment.
(i) In General. The Borrower may not, except as otherwise expressly
provided in this Agreement, prepay the Loan (or any portion thereof) prior
to the Designated Date. On or after the Designated Date, on any Business
Day (a "Prepayment Date"), on not less than three Business Days' prior
irrevocable written notice from the Borrower to the Administrative Agent,
the Borrower may prepay all, or any portion of the outstanding principal
amount of the Loan; provided, however, that no partial prepayment of the
Loan shall be for less than $5,000,000 original principal amount. If the
Borrower elects to prepay the Loan, the Borrower shall pay on the
Prepayment Date to the Administrative Agent the outstanding principal
amount of the Loan subject to prepayment together with all accrued and
unpaid interest thereon, any LIBOR Breakage Costs, the Prepayment Fee (if
applicable), and all other amounts then due and payable under the
Transaction Documents.
(ii) Limited Optional Prepayment. Notwithstanding anything to the
contrary in Section 1.1(c)(i) above and without limiting the Borrower's
obligations under Sections 5.1, 5.2 and 5.3, in the event that the
Borrower receives notice from any Lender of any costs that the Borrower is
required to pay to such Lender pursuant to any of Sections 5.1, 5.2 or
5.3, the Borrower and such Lender shall negotiate in good faith in order
to arrive at a mutually acceptable alternative means of structuring the
Loan Amount held by such Lender in order to mitigate, minimize or
eliminate such costs in the future. In the event that the Borrower and
such Lender are not able to agree, within thirty (30) days following the
date of the notice to the Borrower of amounts due under any of Section
5.1, 5.2 or 5.3, as the case may be, on an alternative means of
structuring the Loan Amount held by such Lender, then the Borrower shall
have the right, exercisable upon not less than ten Business Days' prior
notice to the applicable Lender (with a copy to the Administrative Agent),
to prepay in full the Loan Amount held by such Lender, together with
accrued interest thereon, any LIBOR Breakage Costs and any amounts due to
such Lender pursuant to Sections 5.1, 5.2 and 5.3, as applicable. Any
prepayment by the Borrower pursuant to this Section 1.1(c)(ii) shall be
made by the Borrower directly to the applicable Lender, and no prepayment
by the Borrower pursuant to this Section 1.1(c)(ii) shall have any effect
on the Borrower's obligations with respect to the remaining outstanding
balance of the Loan to any of the other Lenders hereunder. For the
avoidance of doubt
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such prepayment would not be subject to any Prepayment Fee, may be made
prior to the Designated Date and may be in an amount less than $5,000,000.
(d) Ratio Prepayment. In the event that, in accordance with Section 3.03
of the Mortgage, the Borrower is entitled to make, and elects to make, a
prepayment of the Loan, then the amount of such prepayment shall be paid,
together with accrued interest thereon to the date of such prepayment, plus any
LIBOR Breakage Costs. For the avoidance of doubt such prepayment would not be
subject to any Prepayment Fee, may be made prior to the Designated Date and may
be in an amount less than $5,000,000.
(e) Pro Rata Treatment. Except to the extent otherwise provided herein
(including, but not limited to, as otherwise specified in Section 1.1(c)(ii)
above and Section 1.6 below): (a) the borrowing of the Loan from the Lenders
under Section 1.2 shall be made from the Lenders pro rata according to the
amounts of their respective Commitments; (b) each payment or prepayment of
principal of the Loan shall be made for account of the Lenders pro rata in
accordance with the respective unpaid principal amounts of the Loan held by them
(as evidenced by the Notes, regardless of Series, held by them); and (c) each
payment of interest on the Loan shall be made for account of the Lenders pro
rata in accordance with the amounts of interest on the Loan then due and payable
to the Lenders, but must in all respects comply with the terms of the Mortgage.
Section 1.2. Making the Loan.
(a) The Loan shall be requested by the delivery of a Notice of
Borrowing by the Borrower to the Administrative Agent not later than 4:00 p.m.
(New York City time) on the third Business Day prior to the Funding Date
specified in such notice. The Administrative Agent shall give to each Lender
prompt notice thereof. The Notice of Borrowing shall be irrevocable and binding
on the Borrower. The Notice of Borrowing shall be in writing specifying therein
the (i) the aggregate amount of the Loan to be funded, and (ii) the proposed
Funding Date. The Original Series A Lender and the Original Series B Lender
shall, before 10:00 a.m. (New York City time) on the scheduled Funding Date,
make available for the account of its Lending Office to the Administrative
Agent's Account, in immediately available funds, the Series A Commitment and the
Series B Commitment respectively. After the Administrative Agent's receipt of
such funds and upon fulfillment of the applicable conditions set forth in
Article VI as confirmed during a closing conference call pursuant to which the
Administrative Agent or its counsel shall indicate such fulfillment, the
Administrative Agent shall transfer such funds to the Borrower at its account at
Bank One Arizona, N.A. (ABA No. 122-100-024), Account Number 00000000.
(b) If for any reason a Closing is not consummated on the Funding
Date set forth in the Notice of Borrowing, the Borrower may, by written notice
to the Administrative Agent given by 5:00 p.m., New York City time on the
scheduled Funding Date, designate a delayed Funding Date for such Closing, in
which case the Administrative Agent shall hold the funds provided by the Lenders
until such delayed Funding Date and use reasonable efforts to invest such funds
in Permitted Investments, as directed by the Borrower, provided, that if such
Closing does not occur by the third Business Day after such initial scheduled
Funding Date, such funds shall be returned to the Lenders. The Administrative
Agent shall pay to the Borrower upon its request
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any earnings from such investments, and the Borrower shall pay to the
Administrative Agent upon its request any losses from such investments. If the
Closing fails to occur on a scheduled or delayed Funding Date and the Borrower
does not give notice of a delayed Funding Date pursuant to this Section, the
Administrative Agent shall promptly return to the Lenders the amounts funded by
them and the Borrower shall pay to the Lenders upon demand LIBOR Breakage Costs
with respect to amounts funded plus, in the case of failure to close on a
delayed Funding Date, interest from and including the initial scheduled Funding
Date to but excluding the date on which such funds are returned by 1:00 p.m.
(New York City time) (or, if returned after such time on such date, to but
excluding the next Business Day), at a rate per annum equal to the relevant
LIBOR Rate plus the Applicable Margin that would have been applicable thereto
had the Closing occurred on the initial scheduled Funding Date. If the Borrower
has designated a delayed Funding Date pursuant to this Section and the Closing
occurs on such delayed Funding Date, the Loan shall begin to accrue interest at
the relevant LIBOR Rate plus the Applicable Margin on the date that funds were
originally provided by the Lenders to the Administrative Agent to make the Loan
(which shall be deemed to be the commencement date of the initial Interest
Period for the Loan); provided, however, if all conditions precedent specified
in Article VI are satisfied in full on or before the initial scheduled Funding
Date and the Closing does not occur on the initial scheduled Funding Date solely
due to the failure of the Lenders to fund the Loan pursuant to their respective
Commitments hereunder (but the Closing does occur later pursuant to this Section
1.2(b)), then the Loan shall begin to accrue interest only on the date that the
Closing actually occurs (rather than from the initial scheduled Funding Date).
Section 1.3. Fees. The Borrower shall pay to the Administrative Agent
on the Funding Date an upfront fee in the amount agreed to separately with the
Administrative Agent in writing.
Section 1.4. Commitment Termination. The Aggregate Commitment and the
Commitment of each Lender shall terminate on the earlier of (i) the making of
the Loan pursuant to Section 1.2(a) above, or (ii) at 5:00 p.m. (New York time)
on the Commitment Termination Date.
Section 1.5. [Intentionally omitted.].
Section 1.6. Substitute Lenders. In the event the Borrower is required
under the provisions of Section 5.1, 5.2 or 5.3 to make payments to any Lender,
a notice has been given to the Borrower under Section 1.7(g) and the Borrower
and a Lender are unable to agree on a Substitute Basis or an Affected Lender has
given notice to the Borrower under Section 1.7(c) and the Borrower and the
Affected Lender are unable to agree on a Substitute Basis, the Borrower may, so
long as no Potential Default under clause (a), (e) or (f) of Section 7.1 or
Event of Default shall have occurred and be continuing, elect to terminate such
Lender (or Affected Lender) as a party to this Agreement; provided that
concurrently with such termination, (i) the Borrower shall pay or cause to be
paid to that Lender (or Affected Lender) all principal, interest, LIBOR Breakage
Costs and fees and other Obligations (including, without limitation, amounts, if
any, owed under Sections 5.1, 5.2 and 5.3) due to such Lender (or Affected
Lender) through such date of termination, (ii) another financial institution
reasonably satisfactory to the Borrower and the Administrative Agent shall
agree, as of such date, to become a Lender for all purposes under this Agreement
(whether by assignment or amendment) and to assume all obligations of the Lender
(or Affected Lender) to be terminated as of such date, and (iii) all documents
and supporting
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materials necessary, in the reasonable judgment of the Administrative Agent, to
evidence the substitution of such Lender shall have been received and approved
by the Administrative Agent as of such date.
Section 1.7. Special Provisions Governing the Loan. Notwithstanding any
other provision of this Agreement to the contrary, the following provisions
shall govern with respect to the Loans as to the matters covered:
(a) As soon as practicable after 11:00 a.m. (London time) on each Interest
Rate Determination Date, the Administrative Agent shall determine the interest
rate that shall apply to each Series of Notes for the applicable Interest Period
(which determination shall be prima facie evidence of such rate) and shall
promptly give notice thereof (in writing or by telephone confirmed in writing)
to the Borrower, the Security Trustee and each Lender; provided that the
Administrative Agent's failure to so give notice shall not relieve the Borrower
of its obligation to pay interest on the Notes hereunder.
(b) [Intentionally Omitted.]
(c) In the event that on any date the making, maintaining or continuation
by any Lender of its Percentage Share of the Loan as evidenced by its Notes has
become unlawful as a result of compliance by such Lender in good faith with any
change that becomes effective after the date hereof in any law, treaty,
governmental rule, regulation, guideline or order (whether or not having the
force of law), then, and in any such event, such Lender shall be an "Affected
Lender" and it shall promptly so notify (by facsimile or by telephone confirmed
in writing) the Borrower and the Security Trustee (which notice the Security
Trustee shall promptly transmit to each other Lender). Thereafter (i) the
obligation of the Affected Lender to make its Percentage Share of the Loan as
evidenced by its Notes (if not yet funded) shall be suspended until such notice
shall be withdrawn by the Affected Lender, (ii) the Affected Lender's obligation
to maintain its outstanding Loan Amount as evidenced by its Notes (the "Affected
Loan Amount") shall be suspended with respect to the Affected Loan Amount until
such notice shall be withdrawn by the Affected Lender, and (iii) the parties
shall follow the procedures set forth in Section 1.7(f) with respect to the
Affected Loan Amount so long as, if following such procedures, the maintaining
continuation of such Affected Loan Amount or the balance of the Loan is not
unlawful. The Borrower may elect to terminate such Affected Lender as a party to
this Agreement in compliance with Section 1.6. Except as provided in the
immediately preceding sentence, nothing in this Section 1.7(c) shall affect the
obligation of any Lender other than an Affected Lender to make its Percentage
Share of the Loan or maintain its Loan Amount as evidenced by its Notes in
accordance with the terms of this Agreement.
(d) The Borrower shall compensate each Lender, within ten (10) Business
Days after written request by that Lender (which request shall set forth in
reasonable detail the basis for requesting such amounts), for all reasonable
losses, costs, expenses and liabilities (including any interest paid by that
Lender to lenders of funds borrowed by it to make or carry its Loan Amount as
evidenced by its Notes and any loss, expense or liability sustained by that
Lender in connection with the liquidation or re-employment of such funds)
(collectively, "LIBOR Breakage Costs") which that Lender may sustain: (i) except
as provided in Section 1.2(b), if for any reason (other than a default by that
Lender) a borrowing of the Loan does not occur on a date
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specified therefor in a Notice of Borrowing, (ii) as a consequence of any
prepayment or other principal payment of the Loan or any portion thereof that
occurs on a date other than the last day of an Interest Period, (iii) to the
extent that any prepayment of the Loan or any portion thereof is not made on any
date specified in a notice of prepayment given by the Borrower (including,
without limitation, any notice of prepayment revoked by the Borrower), (iv) as a
consequence of the replacement of such Lender pursuant to Section 1.6 or (v) as
a consequence of any default by the Borrower in the repayment of the Loan when
required by the terms of this Agreement.
(e) In the case of any Lender, LIBOR Breakage Costs shall not exceed the
excess, if any, of (A) the amount of interest which would have accrued on the
principal amount of such Lender's Loan Amount (or in the case of an event
described in subclause (i) of Section 1.7(c) above, such Lender's Percentage
Share) had such event not occurred, at the LIBOR Rate that would have been
applicable to the Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, for the period that would have been the Interest Period for the
Loan)(the "Break Period"), over (B) the interest that would have accrued on such
amount during the Break Period at an interest rate equal to the LIBOR Rate
(determined two Business Days prior to the first day of the Break Period) with a
maturity comparable to the Break Period (or, if no such rate exists for such
period, the rate determined from the applicable Bloomberg screen using standard
interpolation methodologies by reference to the next higher and next lower
available maturities (as determined by the Administrative Agent). A certificate
of any Lender setting forth any amount or amounts that such Lender is entitled
to receive pursuant to this Section shall be delivered to the Borrower and shall
be prima facie evidence of amounts owed under this Section. The Borrower shall
pay such Lender the amount shown as due on any such certificate within 10 days
after receipt thereof.
(f) During the 30 days following the date of any notice given to the
Borrower pursuant to Section 1.7(c) or 1.7(g), each Affected Lender (or, in the
case of Section 1.7(g), each Lender) and the Borrower shall negotiate in good
faith in order to arrive at a mutually acceptable alternative basis for
determining the interest rate from time to time applicable to the Affected Loan
Amount (or, in the case of Section 1.7(g), the Loan) (the "Substitute Basis");
such interest rate to be based on an agreed cost-of-funds benchmark plus the
Applicable Margin. If within the 30 days following the date of any such notice
to the Borrower, any Affected Lender (or, in the case of Section 1.7(g), any
Lender) and the Borrower shall agree upon a Substitute Basis, such Substitute
Basis shall be retroactive to and effective from the first day of the applicable
Interest Periods until and including the last day of such Interest Periods. If
after 30 days from the date of such notice, any Affected Lender (or, in the case
of Section 1.7(g), any Lender) and the Borrower shall have failed to agree upon
a Substitute Basis, then each such Affected Lender (or, in the case of Section
1.7(g), each such Lender) shall certify in writing to the Borrower through the
Security Trustee (such certification to be conclusive and binding on all of the
parties hereto absent manifest error) the interest rate at which such Affected
Lender (or, in the case of Section 1.7(g), such Lender) is prepared to make or
maintain the Affected Loan Amount (or, in the case of Section 1.7(g), its Loan
Amount) for such Interest Periods, such interest rate to be retroactive to and
effective from the first day of such Interest Period. If no Substitute Basis is
established, upon receipt of notice of the interest rates at which an Affected
Lender (or, in the case of Section 1.7(g), a Lender) is prepared to make or
maintain its affected Loans, the Borrower shall have the right (i) exercisable
upon ten Business Days' prior notice to such Affected Lender (or such Lender)
through the Security Trustee (A) to continue to borrow the relevant Loan Amount
at the
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interest rates so advised by such Affected Lender (or such Lender) (as such
rates may be modified, from time to time, at the outset of each subsequent
Interest Period) or (B) to prepay in full the affected Loan Amount of any such
Affected Lender (or any such Lender), together with accrued interest thereon at
the interest rate certified in writing by such Affected Lender (or such Lender)
as provided above and any LIBOR Breakage Costs (provided that LIBOR Breakage
Costs shall not include amounts attributable to an Affected Lender's (or in the
case of Section 1.7(g), a Lender's) funding commitment of greater than three
months), whereupon such affected Loan Amount shall become due and payable on the
date specified by the Borrower in such notice or (ii) to substitute any such
Affected Lender (or such Lender) pursuant to the provisions of, and subject to
the conditions contained in, Section 1.6.
(g) In the event that on any Interest Rate Determination Date, by reason
of circumstances affecting the interbank Eurodollar market, adequate and fair
means do not exist for ascertaining the interest rate applicable to the Loan on
the basis provided for in the definition of LIBOR Rate, the Administrative Agent
shall on such date give notice (by facsimile or by telephone confirmed in
writing) to the Borrower and each Lender of such circumstance, whereupon the
relevant provisions of Section 1.7(f) shall be applicable.
Section 1.8. Payments and Computations.
(a) The Borrower shall make each payment hereunder and under the Notes not
later than 12:30 p.m. (New York City time) on the day when due in Dollars to the
Administrative Agent's Account in immediately available funds, without set-off
or counterclaim (except for any required withholding taxes not subject to
indemnification hereunder). Any amounts received after such time may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for the purpose of calculating interest thereon.
The Administrative Agent will promptly thereafter but in no event later than
2:00 p.m. (New York City time) on the date such funds are received by the
Administrative Agent from the Borrower cause to be distributed like funds to the
Lenders for the account of their respective Lending Offices, in each case to be
applied in accordance with the terms of this Agreement. If the payment by the
Borrower is received by the Administrative Agent after 12:30 p.m., New York
time, at the place of payment, the Administrative Agent shall make payment
promptly, but not later than 2:00 p.m. New York time on the next succeeding
Business Day. Upon its acceptance of any Transfer Supplement and recording of
the information contained therein in the Register pursuant to Section 9.8(d),
from and after the effective date specified in such Transfer Supplement, the
Administrative Agent shall make all payments hereunder and under the Notes in
respect of the interest assigned thereby to the Lender assignee thereunder.
(b) Whenever any payment hereunder or under the Notes shall be stated to
be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or other amounts as the case
may be; provided, however, that, if such extension would cause payment of
interest on or principal of a Loan to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day, and such
reduction of time shall be given effect in the computation of the payment of
interest hereunder.
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Section 1.9. Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Loan owing to it in excess of its
proportionate share of payments on account of the Obligations, such Lender shall
forthwith purchase from the other Lenders such participation in the applicable
Obligations as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and such Lender shall
repay to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's proportionate share (according to
the proportion of (i) the amount of such Lender's required repayment to (ii) the
total amount so recovered from the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount
so recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 1.9 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Lender were the
direct creditor of the Borrower in the amount of such participation.
Section 1.10. Obligation of Lenders to Mitigate. If an event or the
existence of a condition occurs that would cause any Lender to become an
Affected Lender or that would entitle such Lender to receive payments under
Section 5.1, 5.2 or 5.3, then, upon the request of the Borrower, such Lender
will to the extent not inconsistent with any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, fund or maintain the
Commitment of such Lender or the Loan Amount of such Lender through another
lending office of such Lender or (ii) take such other reasonable measures, if as
a result thereof the circumstances which would cause such Lender to be an
Affected Lender would cease to exist or the additional amounts which would
otherwise be required to be paid to such Lender pursuant to Sections 5.1, 5.2
and 5.3 would be reduced and if the making, funding or maintaining of such
Commitment or Loan Amount through such other lending office or in accordance
with such other measures, as the case may be, would not otherwise materially
adversely affect such Commitment or Loan Amount or the interests of such Lender;
provided that such Lender will not be obligated to utilize such other lending
office pursuant to this Section 1.10 unless the Borrower agrees to pay all
incremental expenses, if any, incurred by such Lender as a result of utilizing
such other lending office as described in clause (i) above; provided, further,
that such Lender shall have no obligation to designate another lending office
that does not maintain loans comparable to the Loan. A certificate as to the
amount of any such expenses (setting forth in reasonable detail the basis for
requesting such amount and the calculation thereof) submitted by such Lender to
the Borrower (with a copy to the Security Trustee) shall be prima facie evidence
of such expenses.
Section 1.11. Replacement Notes So long as General Electric Capital
Corporation and its Affiliates are the only Lenders, Replacement Notes may be
issued in accordance with the terms and conditions set forth in the Restructure
Letter.
ARTICLE II
INTEREST
Section 2.1. Rate of Interest. Subject to Section 1.7 hereof, each Note
shall bear interest on the unpaid principal amount thereof for each Interest
Period from the date made
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through maturity (whether by acceleration or otherwise) at a rate equal to the
sum of the LIBOR Rate for such Interest Period plus the Applicable Margin. The
applicable Interest Period for determining the rate of interest with respect to
each Note or portion thereof shall be established in accordance with Section
2.2.
Section 2.2. Interest Periods.
(a) Interest Periods. The first Interest Period shall be the period
commencing on the Funding Date (provided, that in the case of a delayed Funding
Date, the date the funds for such Note are made available to the Administrative
Agent shall be the commencement date of such Interest Period pursuant to Section
1.2(b)), and shall end on, but shall exclude, the next Interest Payment Date,
and thereafter each successive Interest Period shall commence on (and shall
include) the last day of the next preceding Interest Period and shall end on
(but shall exclude) the next succeeding Interest Payment Date, provided however
that notwithstanding anything in this Agreement to the contrary, the final
Interest Period shall end on the Maturity Date.
(b) Expiration of Interest Periods. If an Interest Period would otherwise
expire on a day that is not a Business Day, such Interest Period shall expire on
the next succeeding Business Day; provided that, if any Interest Period would
otherwise expire on a day that is not a Business Day but is a day of the month
after which no further Business Day occurs in such month, such Interest Period
shall expire on the next preceding Business Day.
Section 2.3. Interest Payments. Accrued interest on each Note shall be
payable in arrears on the last day of each Interest Period; provided, that (i)
interest accrued pursuant to Section 2.4 shall be payable on demand and (ii) in
the event of any repayment or prepayment of any Note (or any portion thereof),
accrued interest on the principal amount repaid or prepaid shall be payable on
the date of such repayment or prepayment.
Section 2.4. Default Rate. Notwithstanding Section 2.1, the Borrower shall
pay the Security Trustee for the account of the Lenders and the Transaction
Agents on demand interest on any principal, interest, fee or other amount not
paid hereunder, under any Note or under any other Transaction Document when due
at a rate per annum that is 2% per annum in excess of the LIBOR Rate for the
relevant Interest Period plus the Applicable Margin (the "Default Rate").
Section 2.5. Computation of Interest. Interest on the Notes shall be
computed on the basis of a 360-day year for the actual number of days elapsed in
the period during which such amount accrues. In computing such amounts, the
first day of the applicable period shall be included, and the last day of the
applicable period shall be excluded; provided that if a Note (or any portion
thereof) is repaid on the same day on which it is made, one day's interest shall
be paid on that Note or the relevant portion thereof.
Section 2.6. Maximum Rate. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Note, together with
all fees, charges and other amounts which are treated as interest on such Note
under applicable law (collectively the "Charges"), shall exceed the maximum
lawful rate (the "Maximum Rate") which may be contracted for, charged, taken,
received or reserved by the Lender holding the Loan or the relevant portion
thereof in accordance with applicable law, the rate of interest payable in
respect of such Note or
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the relevant portion thereof hereunder, together with all Charges payable in
respect thereof, shall be limited to the Maximum Rate and, to the extent lawful,
the interest and Charges that would have been payable in respect of such Note or
the relevant portion thereof but were not payable as a result of the operation
of this Section shall be cumulated and the interest and Charges payable to such
Lender in respect of other periods shall be increased (but not above the Maximum
Rate therefor) until such cumulated amount, together with interest thereon at
the LIBOR Rate to the date of repayment, shall have been received by such
Lender.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Representations and Warranties. The Borrower represents and
warrants to the Transaction Agents and each Lender as of the date of this
Agreement that:
(a) Organization; Powers. The Borrower is duly incorporated, validly
existing and in good standing under the laws of Delaware, has all requisite
corporate power and authority to carry on its business as now conducted and,
except where the failure to do so, individually or in the aggregate, would not
result in a Material Adverse Change, is qualified to do business in, and is in
good standing in, every jurisdiction where such qualification is required.
(b) Authorization; Enforceability. The execution and delivery of the
Transaction Documents by the Borrower and the performance by the Borrower of its
obligations thereunder are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action of Borrower and do not require
any stockholder approval, or approval or consent of any trustee or holder of
indebtedness or obligations of the Borrower except such as have been duly
obtained. This Agreement has been duly executed and delivered by the Borrower
and the other Transaction Documents will be duly executed and delivered by the
Borrower when required by this Agreement. This Agreement constitutes, and each
of the other Transaction Documents when executed and delivered by the Borrower
will constitute, a legal, valid and binding obligation of the Borrower,
enforceable against the Borrower in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
(c) No Violation. The execution and delivery by the Borrower of the
Transaction Documents and the performance by the Borrower of its obligations
thereunder do not and will not (a) violate any provision of the Certificate of
Incorporation or By-Laws of the Borrower, (b) violate any law applicable to or
binding on the Borrower or (c) violate or constitute any default under (other
than any violation or default that would not result in a Material Adverse
Change), or result in the creation of any Lien (other than as permitted under
the Mortgage) upon any Pledged Spare Part under, any indenture, mortgage,
chattel mortgage, deed of trust, conditional sales contract, lease, loan or
other material agreement, instrument or document to which the Borrower is party
or by which the Borrower or any of its properties is bound.
(d) Governmental Approvals. The execution and delivery by the Borrower of
the Transaction Documents and the performance by the Borrower of its obligations
thereunder do not and will not require the consent or approval of, or the giving
of notice to, or the registration
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with, or the recording or filing of any documents with, or the taking of any
other action in respect of, any Governmental Authority, other than (i) the
consents of the ATSB and the four counterguarantors under the ATSB loan
documents to the Transaction Documents and the Additional Documents, which have
been obtained, (ii) the filings, recordings, notices and other ministerial
actions pursuant to any routine recording, and contractual or regulatory
requirements applicable to it, each of which has been effected or obtained, and
(iii) the filings described in Section 3.2(b).
(e) Litigation. Except as set forth in the Borrower's Annual Report on
Form 10-K for 2003 (as amended through the Funding Date), or in any Quarterly
Report on Form 10-Q or Current Report on Form 8-K filed by the Borrower with the
SEC subsequent to such Form 10-K (in each case as amended through the Funding
Date) (a list of which filings has been provided by Borrower to the
Administrative Agent on the Funding Date), no action, claim or proceeding is now
pending or, to the Actual Knowledge of the Borrower, threatened against the
Borrower before any court, governmental body, arbitration board, tribunal or
administrative agency, which is reasonably likely to be determined adversely to
the Borrower and if determined adversely to the Borrower would result in a
Material Adverse Change.
(f) Financial Condition. The audited consolidated balance sheet of the
Borrower with respect to its most recent fiscal year included in its Annual
Report on Form 10-K for 2003 (as amended through the Funding Date) filed by the
Borrower with the SEC, and the related consolidated statements of operations and
cash flows for the year then ended have been prepared in accordance with GAAP
and fairly present in all material respects the financial condition of the
Borrower and its consolidated subsidiaries as of such date and the results of
its operations and cash flows for such period, and since the date of such
balance sheet there has been no Material Adverse Change in such financial
condition or operations of the Borrower, except for matters disclosed in (a) the
financial statements referred to above or (b) any subsequent Quarterly Report on
Form 10-Q or Current Report on Form 8-K filed by the Borrower with the SEC (in
each case as amended through the Funding Date) (a list of which filings has been
provided by Borrower in writing to the Administrative Agent on the Funding
Date). The consolidated balance sheet of the Borrower as of June 30, 2004
included in its Quarterly Report on Form 10-Q for the period ended June 30,
2004, and the related consolidated statement of operations and cash flows for
the three months then ended have been prepared in accordance with GAAP (subject
to normal year-end adjustments and the absence of footnotes) and fairly present
in all material respects the financial condition of the Borrower and its
consolidated subsidiaries as of such date and the results of its operations and
cash flows for such period.
(g) No Default. No Event of Default or Potential Default has occurred and
is continuing.
(h) Investment and Holding Company Status. The Borrower is not (i) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (ii) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.
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(i) Use of Proceeds. No part of the proceeds of the Loan will be used,
whether directly or indirectly, for any purpose that entails a violation of
Regulations U or X of the Board of Governors of the Federal Reserve System.
(j) Licenses, Permits, etc. The Borrower is a Certificated Air Carrier and
holds all licenses, permits and franchises from the appropriate Governmental
Authorities necessary to authorize the Borrower to lawfully engage in air
transportation and to carry on scheduled commercial passenger service as
currently conducted, except where the failure to so hold any such license,
permit or franchise would not give rise to a Material Adverse Change.
(k) Compliance with Laws. Each of the Borrower and its Subsidiaries is in
compliance with all laws, regulations and orders of any governmental or
regulatory authority or agency applicable to it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Change.
(l) Tax Returns. The Borrower and its Subsidiaries have timely filed all
Federal income tax returns and all other material tax returns that are required
to be filed by them and have paid all Taxes that are material in amount shown to
be due pursuant to such returns or pursuant to any assessment received by the
Borrower or any of its Subsidiaries, other than any such assessment that is
being contested in good faith through appropriate proceedings and against which
adequate reserves are being maintained and the nonpayment of which (individually
or in the aggregate) could reasonably be expected to cause a material impairment
of the ability of the Borrower to perform, or the Transaction Agents or the
Lenders to enforce, the obligations of the Borrower under the Transaction
Documents. The charges, accruals and reserves on the books of the Borrower and
its Subsidiaries in respect of taxes and other governmental charges are, in the
opinion of the Borrower, adequate.
(m) Information. The Borrower's Annual Report on Form 10-K for 2003 filed
with the SEC and each of the Borrower's Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K subsequently filed by the Borrower with the SEC, as
of the date it was filed with the SEC (or, if such report has been amended, in
each case as amended through the Funding Date) did not contain any untrue
statement of material fact or omit to state any material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
(n) ERISA. The Borrower and its subsidiaries have no employee benefit
plans covered by the minimum funding requirements of ERISA.
Section 3.2. The Pledged Spare Parts. The Borrower represents and
warrants to the Transaction Agents and each Lender, as of the date of this
Agreement and as of the Funding Date, that:
(a) Good Title. The Borrower has good title to the Pledged Spare Parts,
free and clear of Liens other than any Permitted Liens and the Liens to be
released by the Release, and no Person holds any right or interest in any of the
Pledged Spare Parts by virtue of any interest that such Person may have in the
real property or improvements located at any of the Designated
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Locations (whether as fee owner, landlord, tenant, ground lessor, mortgagee,
leasehold mortgagee, beneficiary of deed of trust, beneficiary of leasehold deed
of trust or otherwise).
(b) Filings. Except for (i) the filing for recordation (and recordation)
with the FAA of the FAA Filed Documents with respect to the Pledged Spare Parts
located at the Designated Locations, and (ii) the filing of the Financing
Statements (and continuation statements relating thereto at periodic intervals)
with the Secretary of State of the State of Delaware (UCC Division) with respect
to the Collateral, no further action, including any filing or recording of any
document (including any financing statement in respect thereof under Article 9
of the UCC) is necessary in order to establish and perfect the Security
Trustee's interest in the Collateral created under the Mortgage as against the
Borrower and any other Person, in each case in any applicable jurisdiction in
the United States.
(c) [Intentionally omitted.]
(d) Section 1110. The Security Trustee is entitled to the benefits of
Section 1110 of the Bankruptcy Code with respect to not less than the Minimum
1110 Percentage (determined on the basis of Appraisal Value as of the Closing
Date) of the Rotables included within the Pledged Spare Parts as provided in the
Mortgage in the event of a case under Chapter 11 of the Bankruptcy Code in which
Borrower is a debtor.
(e) Condition. All Pledged Spare Parts are in the condition and state of
repair required under the FAA-approved maintenance program of Borrower relating
to such Pledged Spare Parts, and no appliances, parts, interests, appurtenances,
accessories or other equipment of whatever nature which are incorporated or
installed in or attached to such Pledged Spare Parts are leased by the Borrower.
(f) Location, Identification and Release of Pledged Spare Parts. All of
the Pledged Spare Parts are or will (upon becoming subject to the Lien of the
Mortgage) be maintained by or on behalf of the Borrower at the Designated
Locations, subject to Section 3.02 of the Mortgage.
(g) Software. The Borrower confirms that (i) the Borrower owns the
Software currently used by the Borrower to track the location, use and
maintenance status of its spare parts, including the source code and user
interfaces associated therewith, free and clear of any Liens other than
Permitted Liens, (ii) the Borrower pays no license fees in respect of such
Software to any Person, (iii) no approval or consent by any Person is required
in respect of the Borrower's right to use such Software or in order to recognize
or give effect to the rights granted by the Borrower to the Security Trustee in
respect of such Software in the Mortgage, and (iv) no Person has any contractual
right, whether contingent or otherwise, to terminate the Borrower's right to use
such Software.
(h) Records. The Borrower shall maintain its records with respect to the
Pledged Spare Parts at a Borrower facility at Sky Harbor Airport in Phoenix,
Arizona, or the applicable Designated Location.
(i) Spare Parts. It is the intention of the parties to this Agreement that
all Pledged Spare Parts be "spare parts" as defined in Section 40102(a)(38) of
Title 49 of the United States Code. The Borrower represents that it maintains
the Pledged Spare Parts for the purpose of
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installing the Spare Parts on aircraft, aircraft engines or appliances as
defined in Sections 40102(a)(6), (7) and (11) of the United States Code.
Section 3.3 Representations and Warranties of the Security Trustee. The
Security Trustee represents and warrants in its individual capacity that:
(a) Powers and Authorizations. It is a national banking association duly
organized and validly existing in good standing under the laws of the United
States and has full power and authority, in its individual capacity, to execute
and deliver this Agreement and (assuming the due authorization, execution and
delivery of this Agreement by the other parties hereto) perform its obligations
hereunder. The execution, delivery and performance by the Security Trustee of
the Transaction Documents to which it is or will be a party have been duly
authorized by all necessary action on its part and do not contravene the Charter
or By-laws of the Security Trustee; and the Transaction Documents to which the
Security Trustee is or will be a party have been duly authorized, executed and
delivered by the Security Trustee and constitute the legal, valid and binding
obligations, enforceable against it in accordance with its terms. This Agreement
and the other Transaction Documents to which the Security Trustee is or will be
a party, upon the due execution and delivery hereof, will constitute the legal,
valid and binding obligations of the Security Trustee in its individual
capacity, and the performance by the Security Trustee (in its individual or
trust capacity, as the case may be) of any of its obligations hereunder and
thereunder does not contravene any federal law or regulation or contractual
restriction binding on or governing the banking or trust powers of the Security
Trustee (in its individual or trust capacity, as the case may be);
(b) Litigation. There are no pending (or, to the Security Trustee's
knowledge, threatened) actions, suits, investigations or proceedings against or
affecting it before any court, arbitrator, or administrative or governmental
body which, individually or in the aggregate, if decided adversely to the
interests of the Security Trustee would materially and adversely affect the
ability of the Security Trustee, either in its individual capacity or as
Security Trustee, as the case may be, to perform its obligations under this
Agreement or any other Transaction Document or which questions or would affect
the legality or validity of this Agreement or such Transaction Document;
(c) No Legal Bar. Neither the execution and delivery by the Security
Trustee of this Agreement or any other Transaction Document nor the consummation
by the Security Trustee of any of the transactions contemplated hereby or
thereby requires or will require the consent or approval of or the giving of
notice to, the registration with, or the taking of any other action in respect
of, any federal governmental authority or agency governing its banking or trust
powers.
Section 3.4 Representations and Warranties of the Lenders. Each Lender
represents and warrants that:
(a) Accredited Investor. It is an accredited investor (as such term is
defined in Rule 501 under the Securities Act of 1933, as amended);
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(b) Investment Intent. It is acquiring its interest in a Note, and any
interest in and to the Collateral, for its own account for investment and not
with a view to resale or distribution (subject, however, to the disposition of
its property being at all times within its control);
(c) ERISA. No part of the funds used by it to acquire its Notes constitute
the assets of any Plan. As used herein, "Plan" means an "employee benefit plan
(as such term is defined in Section 3(3) of ERISA or any "plan" (as such term is
defined in Section 4975(e)(1) of the Code which has been established or
maintained or contributed to by Borrower or an Affiliate that, together with
Borrower is treated as a single employer under Section 414(b), (c) or (m) of the
Code; and
(d) No Offering. Neither it nor anyone acting on its behalf has directly
or indirectly offered its Notes or any interest therein or any interest in and
to the Collateral, for sale to, or solicited any offer to acquire any of the
same from, the public or in any manner that would violate, or require the
registration of the issuance and sale of, such Notes or any interest therein, or
any transaction contemplated hereby, under the Securities Act of 1933, as
amended, the Trust Indenture Act of 1939, as amended, or applicable state
securities laws, or that might subject the Borrower to regulation under, require
Borrower to give notice to, or register with or take any other action in respect
of, any foreign governmental authority or agency.
ARTICLE IV
COVENANTS
Section 4.1. Covenants of the Borrower. The Borrower shall comply with the
following covenants and agreements, unless the Required Lenders shall otherwise
consent:
(a) Financial Statements and Other Information. The Borrower will
furnish to the Transaction Agents and each Lender:
(i) within 120 days after the end of each fiscal year of the
Borrower, a copy of the Form 10-K (excluding exhibits) filed by the
Borrower with the SEC for such fiscal year (or in lieu of such copy
an e-mail notice that such report has been filed with the SEC and
providing a web site address at which such report may be accessed,
provided that such e-mail notice will satisfy this requirement only
if such report is in fact accessible at such web site address), or,
if no such Form 10-K was so filed, its audited consolidated balance
sheet and related statements of operations, stockholders' equity and
cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year,
all reported on by the Borrower's independent public accountants of
recognized national standing to the effect that such consolidated
financial statements present fairly in all material respects the
consolidated financial condition and results of operations of the
Borrower and its Subsidiaries on a consolidated basis in accordance
with GAAP;
(ii) within 60 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower, a copy of the
Form 10-Q (excluding exhibits) filed by the Borrower with the SEC
for such quarterly period (or in lieu of such
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copy an e-mail notice that such report has been filed with the SEC
and providing a web site address at which such report may be
accessed, provided that such e-mail notice will satisfy this
requirement only if such report is in fact accessible at such web
site address), or if no such Form 10-Q was so filed, its
consolidated balance sheet and related statements of operations and
cash flows as of the end of and for such fiscal quarter (in the case
of the statement of operations) and the then elapsed portion of the
fiscal year, setting forth in each case in comparative form the
figures for the corresponding period or periods of (or, in the case
of the balance sheet, as of the end of) the previous fiscal year,
prepared in accordance with GAAP, subject to normal year-end audit
adjustments and the absence of footnotes;
(iii) concurrently with any delivery of financial statements
under clause (i) above, an Officer's Certificate of the Borrower
certifying as to whether the Borrower has Actual Knowledge that a
Potential Default or an Event of Default has occurred and is
continuing and, if so, specifying the details thereof and any action
taken or proposed to be taken with respect thereto;
(iv) promptly following any request therefor, such other
nonconfidential information regarding the Pledged Spare Parts, the
operations, business affairs and financial condition of the Borrower
or any Subsidiary, or compliance with the terms of the Transaction
Documents, as any Transaction Agent or Lender may reasonably
request; and
(v) in the event that Borrower or any Affiliate that, together
with Borrower is treated as a single employer under Section 414(b),
(c) or (m) of the Code, establishes any employee benefit plan
subject to Title IV of ERISA, upon the request of the Security
Trustee or any Lender, Borrower shall provide copies of the most
recent annual reports or returns (IRS Form 5500), audited or
unaudited financial statements and actuarial valuations with respect
to such plans.
(b) Existence; Conduct of Business. The Borrower will, and will
cause each of its Subsidiaries to:
(i) do or cause to be done all things necessary to preserve
and maintain its legal existence; provided that the foregoing shall
not prohibit any merger, consolidation, liquidation or dissolution
permitted under Section 4.1(c); provided further that this Section
4.1(b)(i) shall apply to the Subsidiaries of Borrower, if any, only
to the extent that the dissolution, termination or other loss of
legal existence of such Subsidiaries would reasonably be expected to
(either individually or in the aggregate) cause a material
impairment of the ability of the Borrower to perform, or the
Transaction Agents or the Lenders to enforce, the obligations of the
Borrower under the Transaction Documents.
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(ii) comply with the requirements of all applicable laws,
rules, regulations and orders of governmental or regulatory
authorities if failure to comply with such requirements would
reasonably be expected to (either individually or in the aggregate)
cause a material impairment of the ability of the Borrower to
perform, or the Transaction Agents or the Lenders to enforce, the
obligations of the Borrower under the Transaction Documents;
(iii) pay and discharge all Taxes imposed on it or on its
income or profits or on any of its property prior to the date on
which penalties attach thereto, except for any such Tax the payment
of which is being contested in good faith and by proper proceedings
and against which adequate reserves are being maintained, and the
nonpayment of which (either individually or in the aggregate) could
reasonably be expected to cause a material impairment of the ability
of the Borrower to perform, or the Transaction Agents or the Lenders
to enforce, the obligations of the Borrower under the Transaction
Documents; and
(iv) permit representatives of any Lender, during normal
business hours and on reasonable notice, to discuss its business and
affairs with its officers, all to the extent reasonably requested by
such Lender; provided, however, that this Section 4.1(b)(iv) shall
apply to Subsidiaries of Borrower, if any, only to the extent that
an adverse circumstance with respect to the business and affairs of
such Subsidiaries would reasonably be expected to cause a material
impairment of the ability of the Borrower to perform or the
Transaction Agents or the Lenders to enforce, the obligations of the
Borrower under the Transaction Documents.
(c) Mergers and Consolidations. The Borrower will not consolidate
with or merge into any other Person or convey, transfer or lease all or
substantially all of its assets as an entirety to any Person unless:
(i) the Person formed by such consolidation or into which the
Borrower is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of the Borrower as
an entirety shall be a Certificated Air Carrier;
(ii) the Person formed by such consolidation or into which the
Borrower is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of the Borrower as
an entirety shall execute and deliver to the Security Trustee a duly
authorized, valid, binding and enforceable agreement in form and
substance reasonably satisfactory to the Security Trustee containing
an assumption by such Person of the due and punctual performance and
observance of each covenant and condition of the Transaction
Documents to be performed or observed by the Borrower;
(iii) immediately after giving effect to such transaction, no
Event of Default shall have occurred and be continuing;
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(iv) all filings shall have been made as shall be necessary to
preserve the perfection of (A) the Lien of the Mortgage on the
Pledged Spare Parts on a first priority and perfected basis (subject
to Permitted Liens) and (B) the Lien of the Subordinated Mortgage on
Pledged Spare Parts on a second priority and perfected basis
(subject to Permitted Liens); and
(v) promptly after the consummation of such transaction, the
Borrower shall deliver to the Security Trustee a certificate of the
Secretary or an Assistant Secretary of Borrower certifying as to
Borrower's compliance with the conditions of this Section 4.1(c) and
an opinion of Borrower's Legal Department as to Borrower's
compliance with Sections 4.1(c)(i), 4.l(c)(ii) and 4.1(c)(iv).
Upon any consolidation or merger, or any conveyance, transfer or lease of
all or substantially all of the assets of the Borrower as an entirety in
accordance with this Section 4.1(c), the Person formed by such
consolidation or into which the Borrower is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Borrower under this
Agreement and the other Transaction Documents with the same effect as if
such Person had been named as the Borrower herein. No such conveyance,
transfer or lease of all or substantially all of the assets of the
Borrower as an entirety shall have the effect of releasing the Borrower or
any Person which shall theretofore have become such in the manner
prescribed in this Section 4.1(c) from the Borrower's liability in respect
of any Transaction Document to which it is a party.
(d) Delivery of Post-Recording FAA Opinion. Promptly upon the
recording of the Mortgage, the Subordinated Mortgage and each Supplemental
Mortgage and each Subordinated Supplemental Mortgage covering the Pledged
Spare Parts and Designated Locations pursuant to the Act, the Borrower
will cause Daugherty, Fowler, Peregrin & Xxxxxx, FAA counsel in Oklahoma
City, Oklahoma, to deliver to the Security Trustee and the Borrower a
favorable opinion addressed to each of them as to such recordation and the
lack of filing of any intervening documents creating a Lien with respect
to such Pledged Spare Parts.
(e) Software. The Borrower hereby agrees that it shall maintain a\
spare parts inventory tracking system at all times prior to the Maturity
Date of the Loan.
(f) Compliance with Mortgage. The Borrower will comply with the
terms and provisions of the Mortgage.
ARTICLE V
INCREASED COSTS; GENERAL INDEMNITY
Section 5.1. Increased Costs. The Borrower shall pay directly to each
Lender from time to time, within ten (10) Business Days after demand therefor,
such additional amount or amounts as may be necessary to compensate such Lender
on a net after-tax basis for any increased costs incurred by such Lender which
are attributable to its making or maintaining its Percentage Share or its
Ratable Share of the Loan hereunder or its obligation to make its
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Percentage Share of the Loan hereunder, or any reduction in any amount
receivable by such Lender under this Agreement in respect of the Loan or such
obligation (such increases in costs and reductions in amounts receivable being
herein called "Additional Costs"), resulting from any change after the date of
this Agreement in U.S. federal, state, municipal, or foreign or supranational
laws or regulations (including Regulation D of the Board of Governors of the
Federal Reserve System), or the adoption or making after the date of this
Agreement of any interpretations, directives, or requirements applying to a
class of banks including such Lender under any U.S. federal, state, municipal,
or any foreign laws or regulations (whether or not having the force of law) by
any court, central bank or monetary authority charged with the interpretation or
administration thereof (a "Regulatory Change"), which imposes or modifies any
reserve, special deposit, compulsory loan or similar requirements relating to
any extensions of credit or other assets of, or any deposits with other
liabilities of, such Lender (including its Percentage Share or its Ratable Share
of the Loan or any deposits referred to in the definition of LIBOR Rate or
related definitions) which is not otherwise included in the determination of the
applicable interest rate hereunder.
Each Lender will notify the Borrower of any event occurring after the date
of this Agreement that will entitle such Lender to compensation pursuant to this
Section 5.1 as promptly as practicable, but in any event within 60 days, after
such Lender obtains Actual Knowledge thereof; provided, however, that if any
Lender fails to give such notice within 60 days after it obtains Actual
Knowledge of such an event, such Lender shall, with respect to compensation
payable pursuant to this Section 5.1 in respect of any costs resulting from such
event, be entitled to payment under this Section 5.1 only for costs incurred
from and after the date 60 days prior to the date that such Lender does give
such notice; provided, further that no compensation shall be payable by the
Borrower to any Lender pursuant to this Section 5.1 unless such Lender certifies
to the Borrower that (x) such Lender is assessing to its other borrowers (of
loans similar to the Loans) comparable allocable costs, and (y) such Lender
believes such costs are generally applicable to lenders similarly situated to
and in the same jurisdiction as such Lender. Such notice shall describe in
reasonable detail the calculation of the amounts owed under this Section.
Determinations by a Lender for purposes of this Section 5.1 of the effect of any
Regulatory Change on its costs of making or maintaining its Percentage Share or
its Ratable Share of the Loan or on amounts receivable by it in respect of the
Loan, and of the additional amounts required to compensate such Lender in
respect of any Additional Costs, shall be prima facie evidence of the amount
owed under this Section 5.1.
Any assignee of a Lender that is not the initial Lender party to the Loan
Agreement shall not be entitled to any greater compensation under this Section
5.1 than that which would have been payable to the transferor Lender as of the
date of the transfer or sale of the Note to such transferee Lender; provided,
however, that, if subsequent to the date of transfer or sale of the Note there
occurs a Regulatory Change and such transferee Lender is domiciled in a
Designated Country, such transferee Lender shall be entitled to compensation
under this Section 5.1 as a result of such Regulatory Change.
Section 5.2. Capital Adequacy. If (1) the adoption, after the date hereof,
of any applicable governmental law, rule or regulation regarding capital
adequacy, (2) any change, after the date hereof, in the interpretation or
administration of any such law, rule or regulation by any central bank or other
Governmental Authority charged with the interpretation or administration
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thereof or (3) compliance by a Lender or any corporation or bank controlling a
Lender with any applicable guideline or request of general applicability, issued
after the date hereof, by any central bank or other Governmental Authority
(whether or not having the force of law) that constitutes a change of the nature
described in clause (2) ("Capital Adequacy Change"), has the effect of (x)
requiring an increase in the amount of capital required to be maintained by a
Lender or any corporation or bank controlling a Lender or (y) reducing the rate
of return on assets or capital of such Lender (or such corporation or bank) and
such adoption, change or compliance, as the case may be, relates to a category
of claims or assets that includes such Lender's Loan Amount, the Borrower shall
pay to such Lender from time to time such additional amount or amounts as are
necessary to compensate such Lender for such portion of such increase or
reduction as shall be reasonably allocable to such Lender's Loan Amount;
provided, that no such amounts shall be payable by the Borrower to any Lender
pursuant to this Section 5.2 unless such Lender certifies to the Borrower that
(A) such Lender is assessing to its other borrowers (of loans similar to the
Loans) comparable allocable costs, and (B) such Lender believes such costs are
generally applicable to lenders similarly situated to and in the same
jurisdiction as such Lender. For the avoidance of doubt, the matters set forth
in the Consultative Document titled "The New Basel Capital Accord" issued by the
Basel Committee on Banking Supervision in April 2003 will not be treated, for
purposes of determining whether any Lender is entitled to compensation under
this Section 5.2, as having been enacted or having come into effect before the
date of this Agreement.
Each Lender will notify the Borrower of any event occurring after the date
of this Agreement that will entitle such Lender to compensation pursuant to this
Section 5.2 as promptly as practicable but in any event within 60 days, after
such Lender obtains Actual Knowledge thereof; provided, however, that if any
Lender fails to give such notice within 60 days after it obtains Actual
Knowledge of such an event, such Lender shall, with respect to compensation
payable pursuant to this Section 5.2 in respect of any costs resulting from such
event, be entitled to payment under this Section 5.2 only for costs incurred
from and after the date 60 days prior to the date that such Lender does give
such notice. Such notice shall describe in reasonable detail the calculation of
the amounts owed under this Section. Determinations by a Lender for purposes of
this Section 5.2 of the effect of any increase in the amount of capital required
to be maintained by the bank and of the amount allocable to such Lender's
obligations to the Borrower hereunder shall be prima facie evidence of the
amounts owed under this Section.
Any assignee of a Lender that is not the initial Lender party to the Loan
Agreement shall not be entitled to any greater compensation under this Section
5.2 than that which would have been payable to the transferor Lender as of the
date of the transfer or sale of the Note to such transferee Lender; provided,
however, that, if subsequent to the date of transfer or sale of the Note there
occurs a Capital Adequacy Change and such transferee Lender is domiciled in a
Designated Country, such transferee Lender shall be entitled to compensation
under this Section 5.2 as a result of such Capital Adequacy Change.
Section 5.3. Withholding of Taxes.
(a) Payments to Be Free and Clear. All sums payable by the Borrower
under this Agreement and the other Transaction Documents to each Lender
and each Transaction Agent shall (except to the extent required by law) be
paid free and clear of,
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and without any deduction or withholding on account of, any Tax imposed,
levied, collected, withheld or assessed by or within any jurisdiction or
by or within any political subdivision or taxing authority thereof or
therein with respect to such payments.
(b) Grossing-up of Payments. If the Borrower or any other Person is
required by law to make any deduction or withholding on account of any Tax
from any sum paid or payable by the Borrower to any Transaction Agent or
any Lender under any of the Transaction Documents:
(i) the Borrower shall notify the Security Trustee in writing
of such requirement;
(ii) the Borrower shall pay such Tax before the date on which
any interest, addition to Tax or penalties attach thereto, such
payment to be made (if the liability to pay is imposed on the
Borrower) for its own account or (if that liability is imposed on
any Transaction Agent or such Lender, as the case may be) on behalf
of and in the name of such Transaction Agent or such Lender;
(iii) in the case of any Tax other than an Excluded Tax, the
sum payable by the Borrower in respect of which the relevant
deduction, withholding or payment is required shall be increased to
the extent necessary to ensure that, after the making of that
deduction, withholding or payment, such Transaction Agent or such
Lender, as the case may be, receives on the due date a net sum equal
to what it would have received had no such deduction, withholding or
payment been required or made; and
(iv) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required
by clause (b) above to pay, the Borrower shall deliver to the
Security Trustee evidence reasonably satisfactory to the affected
parties of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority.
If any additional amounts are payable in respect of Taxes pursuant to
clause (iii) above, the Borrower agrees to indemnify each Lender, each
Transaction Agent and their successors, assigns and Affiliates for such
Taxes required to be deducted or withheld and to reimburse such Persons,
upon the written request of such Person, for the net increase in Tax
imposed on or measured by the net income or net profits of such Lender
(after taking into account current credits and deductions resulting from
such Tax liability) pursuant to the laws of the jurisdiction in which such
Lender is organized or in which the principal office or applicable Lending
Office of such Lender is located or under the laws of any political
subdivision or taxing authority of any such jurisdiction in which such
Lender is organized or in which the principal office or applicable Lending
Office of such Lender is located or in which such Lender is doing business
(if the Taxes imposed on the net income, net profits or net gains of such
Lender by such jurisdiction in which a Lender is doing business are
treated as Excluded Taxes under this Agreement) and for any withholding of
Taxes as such Lender shall reasonably determine (subject to verification
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pursuant to Section 5.3(c)(iv)) are payable by, or withheld from, such
Lender in respect of such amounts so paid to or on behalf of such Lender
pursuant to clause (iii) above and in respect of any amounts paid to or on
behalf of such Lender pursuant to this sentence. Notwithstanding the
foregoing provisions of this Section 5.3(b), no such additional amount
shall be required to be paid to either Transaction Agent or any Lender
under clause (iii) above in respect of United States federal withholding
taxes except to the extent that such obligation to deduct or withhold
results from a written change, after the date hereof in applicable law,
treaty, or governmental rule, regulation or order, or any change in the
official interpretation, administration or application thereof (other than
the addition of or a change in an "anti-treaty-shopping" or "limitation of
benefits" or similar provision of any income tax treaty affecting
eligibility for benefits under such treaty).
(c) Evidence of Exemption from U.S. Withholding Tax.
(i) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof shall, to the extent it is entitled to
do so, deliver to the Security Trustee for transmission to the
Borrower, at or prior to the Closing (in the case of each Lender
listed on the signature pages hereof) or on or prior to the date of
the Transfer Supplement pursuant to which it becomes a Lender (in
the case of each other Lender), (x) two original copies of Internal
Revenue Service Form W-8BEN or W-8ECI (or any successor forms),
properly completed and duly executed by such Lender, together with
any other certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is entitled to an exemption or reduction
in the amount of United States federal income tax required to be
deducted or withheld from any payments to such Lender of interest,
fees or other amounts payable under any of the Transaction Documents
or (y) if such Lender is not a "bank" or other Person described in
Section 881(c)(3) of the Internal Revenue Code and cannot deliver
either Internal Revenue Service Form W-8BEN claiming exemption under
a treaty or W-8ECI, pursuant to clause (x) above, a Certificate re
Non-Bank Status together with two original copies of Internal
Revenue Service Form W-8BEN (or any successor form), properly
completed and duly executed by such Lender, together with any other
certificate or statement of exemption required under the Internal
Revenue Code or the regulations issued thereunder to establish that
such Lender is entitled to an exemption or reduction in the amount
of United States federal income tax required to be withheld from
payments to such Lender of interest payable under any of the
Transaction Documents.
Each Lender that is organized under the laws of the United
States or any state or other political subdivision thereof shall
deliver to the Security Trustee for transmission to the Borrower, at
or prior to the Closing (in the case of each Lender listed on the
signature pages hereof) or on or prior to the date of the Transfer
Supplement pursuant to which it becomes a Lender (in the case of
each other Lender), two original copies of Internal Revenue Service
Form W-9 (or any successor form), properly completed and duly
executed by such Lender, if requested by the Borrower in writing and
required by the Internal Revenue Code
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or the regulations issued thereunder to permit the Borrower to pay
to or for the account of such Lender interest, fees or other amounts
pursuant to any of the Transaction Documents without deducting or
withholding any United States federal income tax from such payment.
(ii) Each Lender required to deliver any forms, certificates
or other evidence with respect to United States federal income tax
withholding matters pursuant to Section 5.3(c)(i) hereby agrees,
from time to time after the initial delivery by such Lender of such
forms, certificates or other evidence, whenever a lapse in time or
change in circumstances (other than, unless notified by the
Borrower, a change in applicable United States law, including United
States income tax conventions and treaties) renders such forms,
certificates or other evidence obsolete or inaccurate in any
material respect, that such Lender, to the extent it is entitled to
do so, shall promptly (x) deliver to the Security Trustee for
transmission to the Borrower two new original copies of Internal
Revenue Service Form W-8BEN or W-8ECI or W-9, or a Certificate re
Non-Bank Status and two original copies of Internal Revenue Service
Form W-8BEN, as the case may be, properly completed and duly
executed by such Lender, together with any other certificate or
statement of exemption required in order to confirm or establish
that such Lender is entitled to an exemption or reduction in the
amount of United States federal income tax required to be withheld
from payments to such Lender under the Transaction Documents or (y)
notify the Security Trustee and the Borrower of its inability to
deliver any such forms, certificates or other evidence in which case
such Lender shall not be required to deliver any such form or
certificate pursuant to this Section 5.3(c).
(iii) The Borrower shall not be required to pay any additional
amount to any Lender under clause (iii) of Section 5.3(b) if such
Lender shall have failed to satisfy the requirements of clause (i)
or (ii)(x) of this Section 5.3(c); provided that if such Lender
shall have satisfied the requirements of Section 5.3(c)(i) at or
prior to the Closing (in the case of each Lender listed on the
signature pages hereof) or on the date of the Transfer Supplement
pursuant to which it became a Lender (in the case of each other
Lender), nothing in this Section 5.3(c)(iii) shall relieve the
Borrower of its obligation to pay any additional amounts pursuant to
Section 5.3(b) in the event that, as a result of any change in any
applicable law, treaty or governmental rule, regulation or order, or
any change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to withholding
as described in Section 5.3(c)(i) or (ii).
(iv) If the Borrower pays any additional amount under this
Section 5.3 to a Lender and such Lender determines in its sole
discretion that it has actually realized in connection therewith a
net cash benefit (including a net cash benefit which the relevant
taxing authority applies to satisfy any liability of such Lender for
Excluded Taxes) due to any refund or any reduction of, or credit
against, its liabilities for Excluded Taxes in any taxable year,
provided no Special Default or
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Event of Default shall have occurred and be continuing, such Lender
shall, to the extent it can do so without prejudice to the retention
of such benefit, pay to the Borrower an amount that the Lender
shall, in its sole discretion, determine (subject to confirmation as
provided below) is equal to such net cash benefit which was obtained
by the Lender in such year as a consequence of such refund,
reduction or credit realized in connection with the payment of such
additional amount. A Lender shall, upon written request from the
Borrower, provide to the Borrower a letter from independent
accountants selected by the Lender and reasonably acceptable to the
Borrower confirming the accuracy of the Lender's calculations of any
amount due pursuant to the next-to-last sentence of Section 5.3(b),
or the amount of any net benefit determined by Lender pursuant to
the preceding sentence, provided that the interpretation of this
Agreement or any other Transaction Document shall not be within the
scope of the accountants' confirmation. Nothing contained in this
Section 5.3(c)(iv) shall be construed as requiring any Lender to
conduct its business or arrange or alter in any respect its tax or
financial affairs so that it is entitled to receive a refund,
reduction or credit or shall require any Lender to provide to the
Borrower or its agents copies of any tax returns or other
information with respect to the income, assets or operations
attesting to such Lender's determination. The Borrower shall
reimburse each Lender for all costs and expenses incurred by Lender
in obtaining such accountants' letter, provided that the
accountants' letter confirms, in all material respects, Lender's
determination.
(v) The Borrower shall have no obligation to pay to any Lender
any additional amount under Section 5.3(b)(iii) or to indemnify any
Lender under Section 5.4 for any United States federal income tax or
withholding tax which was required by law to be deducted or withheld
by the Borrower or any Transaction Agent from any prior payment to
or for the benefit of such Lender pursuant to the Transaction
Documents but which was not deducted or withheld due to the
Borrower's or the Transaction Agent's reasonable reliance on an
Internal Revenue Service Form W-8BEN or W-8ECI or W-9 (or applicable
successor form) theretofore delivered by such Lender pursuant to
Section 5.3(c)(i) or (ii) if such form was inaccurate in any
material respect when delivered by such Lender and such Lender had
actual knowledge of such inaccuracy at the time such Lender
delivered such form.
Section 5.4. (a) Other Taxes. In addition to the amounts described
elsewhere in this Article V, the Borrower shall pay, and indemnify, and hold
harmless on a net after-tax basis each Lender and the Security Trustee from and
against all Other Taxes (other than (i) Taxes imposed by deduction or
withholding from amounts payable by the Borrower to any Transaction Agent or
Lender, (ii) Excluded Taxes and (iii) Taxes imposed on or with respect to a
transfer (including a participation) of any interest in a Loan unless such
transfer is in connection with an Event of Default or at the Borrower's request)
which arise from any payment made hereunder or under any other Transaction
Document or from the execution, delivery, registration, filing, recording,
performance or enforcement of, or otherwise with respect to, this Agreement or
any other Transaction Document or otherwise in connection with or as a result of
the transactions
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contemplated by the Transaction Documents.
(b) Contest of Tax Claims. If a Lender or either Transaction Agent (each a
"Tax Indemnitee") receives a written claim from any taxing authority for any Tax
for which the Borrower is liable pursuant to Section 5.3 or 5.4 (a "Tax Claim"),
such Tax Indemnitee shall promptly notify the Borrower in writing. If requested
by the Borrower in writing within 30 days after receipt of such Tax Indemnitee's
written notice (provided that if a response to such Tax Claim is due less than
40 days after the Borrower's receipt of such Tax Indemnitee's notice, the
Borrower's request must be made within 15 days or, if longer, the period ending
not later than the 10th day before the day on which the response to such Tax
Claim is due), such Tax Indemnitee shall in good faith contest or, at such Tax
Indemnitee's election, permit the Borrower to contest (unless such contest
involves Excluded Taxes or, in such Tax Indemnitee's reasonable, good faith
judgment, permitting the Borrower to contest may have a material adverse effect
on such Tax Indemnitee), in each case in accordance with and to the extent
permitted by applicable law and at the Borrower's expense, such Tax Claim,
provided that no Tax Indemnitee shall have any obligation to commence or
continue the contest of any such Tax Claim unless the following conditions are
satisfied at the time the contest is to be commenced and at all times during the
contest:
(i) no Event of Default (or event described in Section 7.1(a), (b),
(f) which would become an Event of Default after passage of time) shall
have occurred and be continuing,
(ii) contesting such Tax Claim would not result in (A) any risk of
sale, forfeiture, confiscation, seizure or loss of, or the imposition of a
Lien (other than a Lien for the Tax that is the subject of such contest
provided that enforcement of such Lien is stayed until the final
determination of such contest and the Borrower maintains adequate reserves
with respect to such Lien) or (B) any risk of imposition of criminal
liability,
(iii) the aggregate amount of the Taxes that are to be contested
exceeds Twenty-Five Thousand Dollars ($25,000),
(iv) such Tax Indemnitee shall have received a written confirmation
of the Borrower that the Taxes that are the subject of such Tax Claim are
Tax for which the Borrower is liable pursuant to Section 5.3 or 5.4,
provided that the Borrower shall not be bound by such confirmation to the
extent that the final determination of the contest articulates conclusions
of law and fact that demonstrate that the Taxes that are the subject of
such Tax Claim are Excluded Taxes,
(v) the Borrower, upon the written request of such Tax Indemnitee,
shall have provided such Tax Indemnitee, at the expense of the Borrower,
with an opinion of counsel selected by such Tax Indemnitee and reasonably
acceptable to the Borrower to the effect that there is a substantial basis
in law and fact to contest such Tax Claim and a realistic expectation that
a contest of such Tax Claim would be successful,
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(vi) if such Tax Indemnitee decides to contest such Tax Claim by
paying the Taxes that are the subject of such Tax Claim and taking action
to obtain a refund thereof, the Borrower shall have made an interest-free
advance to such Tax Indemnitee in an amount equal to the amount of those
Taxes and shall have delivered to such Tax Indemnitee a written
undertaking to indemnify such Tax Indemnitee and its Affiliates on an
after-tax basis for any adverse Tax consequences (taking into account all
relevant Tax benefits and Tax detriments) to such Tax Indemnitee or any of
its Affiliates resulting from such interest-free advance, and
(vii) the Borrower shall be paying, on demand and on an after-tax
basis, all reasonable costs and expenses incurred by such Tax Indemnitee,
any Transaction Agent or any Lender in connection with the conduct of such
contest (including, without limitation, reasonable attorneys' and
accountants' fees and disbursements).
(c) Non-Parties. If a Tax Indemnitee is not a party to this Agreement, the
Borrower may require such Tax Indemnitee to agree in writing to the terms of
Sections 5.3 and 5.4 prior to making any payment to such Tax Indemnitee under
Section 5.3 or 5.4.
Section 5.5. Indemnity. (a) Indemnity Obligation. The Borrower agrees to
indemnify and hold harmless each Lender, the Security Trustee, the
Administrative Agent, General Electric Capital Corporation under the Restructure
Letter and their respective successors, assigns, directors, officers, employees
and agents (hereinafter in this Section 5.5 referred to individually as an
"Indemnitee," and collectively as "Indemnitees") on an after-tax basis against
any and all liabilities, obligations, losses, damages, penalties, claims,
demands, actions, suits, judgments and any and all costs and expenses (including
reasonable attorneys' fees, disbursements and other charges) (for the purposes
of this Section 5.5 the foregoing are collectively called "Losses") of
whatsoever kind and nature imposed on, asserted against or incurred or suffered
by any of the Indemnitees in any way relating to, or arising out of, or by
reason of any investigation, litigation, or other proceedings (including any
threatened investigation, litigation or other proceedings) relating to the
Mortgage or the exercise or enforcement by the Security Trustee of any of the
terms, rights, or remedies thereunder, or in any way relating to or arising out
of the manufacture, ownership, ordering, purchase, delivery, control,
acceptance, lease, possession, operation, condition, sale, return or other
disposition, or use of the Collateral (including latent or other defects,
whether or not discoverable), the violation of the Laws of any country, state or
other governmental authority with respect to or arising otherwise in connection
with the Collateral, or any tort (including claims arising or imposed under the
doctrine of strict liability, or for or on account of injury to or the death of
any Person (including any Indemnitee), or property damage) with respect to or
arising otherwise in connection with the Collateral (but excluding any such
Losses to the extent incurred by reason of (i) the gross negligence or willful
misconduct of such Indemnitee or any related Indemnitee (as defined below), (ii)
Taxes, reserve requirements or similar regulatory requirements imposed by
banking authorities except as otherwise provided in Sections 5.1, 5.2, 5.3 and
5.4 hereof, (iii) breaches by such Indemnitee of any Transaction Document to
which it is a party or (iv) to the extent attributable to the failure of any
Transaction Agent to distribute funds received and distributable by it in
accordance any such Transaction Documents). For purposes of subclause (i) above,
an Indemnitee shall be considered a "related" Indemnitee with respect to another
Indemnitee if such Indemnitee is an Affiliate or employer of such other
Indemnitee or a director,
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officer, employee or agent of such other Indemnitee, or a successor or assignee
of such other Indemnitee.
(b) Indemnification Procedures.
(i) Notice. In case any action, suit or proceeding shall be brought
against any Indemnitee for which such Indemnitee will seek indemnification under
Section 5.5(a), such Indemnitee shall notify the Borrower of the commencement
thereof and the Borrower may, subject to the provisions of this Section 5.5, at
its expense, participate in and to the extent that it shall wish (subject to the
provisions of the following subsections), assume and control the defense thereof
and, subject to Section 5.5(b)(iii), settle or compromise the same.
Notwithstanding the foregoing, the failure of any Indemnitee to notify the
Borrower as provided in this Section 5.5(b)(i) shall not release the Borrower
from any of its obligations to indemnify such Indemnitee hereunder, except to
the extent that such failure results in an additional Loss to the Borrower (in
which event the Borrower shall not be responsible for such additional Loss) or
materially impairs the Borrower's ability to contest such claim.
(ii) Control. The Borrower or its insurer(s) shall have the right,
at its or their expense, to investigate and, if the Borrower or its insurer(s)
shall agree not to dispute liability to the Indemnitee giving notice of such
action, suit or proceeding under Section 5.5(a) or under any insurance policies
pursuant to which coverage is sought, control the defense of any action, suit or
proceeding relating to any Losses for which indemnification is sought pursuant
to this Section 5.5, and each Indemnitee shall cooperate with the Borrower or
its insurer(s) with respect thereto; provided, that the Borrower shall not be
entitled to control the defense of any such action, suit, proceeding or
compromise any such Losses during the continuance of any Event of Default and so
long as no such cooperation shall entail a material risk of (A) criminal
liability of such Indemnitee, (B) unindemnified civil liability of such
Indemnitee or (C) the sale, loss, forfeiture or seizure of the Collateral. In
connection with any such action, suit or proceeding being controlled by the
Borrower, such Indemnitee shall have the right to participate therein, at its
sole cost and expense.
(iii) Settlement. In no event shall any Indemnitee enter into a
settlement or other compromise with respect to any Losses without the prior
written consent of the Borrower, unless such Indemnitee waives its right to be
indemnified with respect to such Losses under this Section 5.5.
(iv) Cooperation. Each Indemnitee agrees to cooperate with the
Borrower and its insurers in the exercise of their rights to investigate, defend
or compromise Losses for which indemnification may be claimed hereunder.
(v) Nonparties. If an Indemnitee is not a party to this Agreement,
the Borrower may require such Indemnitee to agree in writing to the terms of
this Section 5.5 prior to making any payment to such Indemnitee under this
Section 5.5.
(vi) No Requirement. Nothing contained in this Section 5.5(b) shall
be deemed to require an Indemnitee to assume responsibility for or control of
any judicial proceeding with respect to any Losses.
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ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1. General Conditions. The obligation of the Original Lenders to
make the Loan is subject to the conditions that on or prior to the Funding Date:
(a) The Borrower shall have delivered to the Administrative Agent (with a
copy for each Original Lender) the following:
(i) an executed counterpart of this Agreement;
(ii) an executed counterpart of the Payment and Indemnity Agreement;
(iii) an executed counterpart of the Mortgage;
(iv) an executed counterpart of the Subordinated Mortgage;
(v) an executed counterpart of the Security Trustee Agreement;
(vi) an opinion of Vedder, Price, Xxxxxxx & Kammholz, P.C., special
New York counsel to the Borrower, substantially in the form of Exhibit D
to this Agreement;
(vii) an opinion of the Borrower's Legal Department, substantially
in the form of Exhibit E to this Agreement;
(viii) an opinion of Ray, Xxxxxxx & Xxxxxxx, special counsel to the
Security Trustee, in a form satisfactory to the Administrative Agent;
(ix) an opinion of Daugherty, Fowler, Peregrin & Xxxxxx, FAA
counsel, substantially in the form of Exhibit H to this Agreement;
(x) (1) a certificate of the Secretary or an Assistant Secretary of
the Borrower certifying (i) the resolutions of the Borrower's board of
directors or executive committee of such board approving the transactions
contemplated by this Agreement, (ii) the name and signature of each
officer who executes a Transaction Document or Additional Document on the
Borrower's behalf (on which certificate the Transaction Agents and each
Lender may conclusively rely until a revised certificate is received),
(iii) the Borrower's certificate of incorporation and (iv) a copy of the
Borrower's By-Laws and (2) a good standing certificate of the Borrower
from the Secretary of State of the State of Delaware; and
(xi) an executed counterpart of the Restructure Letter.
(b) The Borrower shall have paid the upfront fee specified in Section 1.3.
Section 6.2. Additional Conditions. The obligation of the Lenders to make
the Loan is subject to the fulfillment, prior to or on the Funding Date, of the
following additional conditions precedent:
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(a) The Security Trustee shall have received the following documents
(with a copy for each Lender):
(i) (1) a Series A Note (duly executed by the Borrower and
authenticated by the Security Trustee) in an original principal
amount equal to the Original Series A Lender's Commitment and (2)
provided that the Original Series B Lender's Commitment is greater
than zero, a Series B Note (duly executed by Borrower and
authenticated by the Security Trustee) in an original principal
amount equal to the Original Series B Lender's Commitment shall each
have been issued to the applicable Original Lender;
(ii) the broker's report and insurance certificate required by
Appendix B of the Mortgage and the Subordinated Mortgage with
respect to the Pledged Spare Parts;
(iii) an Officer's Certificate of the Borrower, dated as of
the Funding Date, stating that its representations and warranties
set forth in Sections 3.1 and 3.2 of this Agreement are true and
correct as of the Funding Date (or, to the extent that any such
representation and warranty expressly relates to an earlier date,
true and correct as of such earlier date);
(iv) the Financing Statements;
(v) the UCC Termination Statements; and
(vi) the Releases.
(b) On the Funding Date, after giving effect to the filing of the
FAA Filed Documents and the Financing Statements with respect to the
Pledged Spare Parts, (i) the Security Trustee under the Mortgage shall
have received a duly perfected first priority security interest in all of
the Borrower's right, title and interest in the Pledged Spare Parts,
subject only, after giving effect to the Release, to Permitted Liens that
are not Liens of record and (ii) the "Security Trustee" under the
Subordinated Mortgage shall have received a duly perfected second priority
security interest in all of the Borrower's right, title and interest in
the Pledged Spare Parts, subject only, after giving effect to the Release,
to the Lien of the Mortgage and other Permitted Liens (as defined in the
Subordinated Mortgage) that are not Liens of Record.
(c) No change shall have occurred after the date of this Agreement
in any applicable law that makes it a violation of law for (a) the
Borrower, the Transaction Agents or any Lender to execute, deliver and
perform the Transaction Documents or Additional Documents to which any of
them is a party or (b) any Lender to make the Loans with respect to the
Pledged Spare Parts.
(d) On the Funding Date, no event shall have occurred and be
continuing, or would result from the mortgage of the Pledged Spare Parts,
which constitutes an Event of Default or a Potential Default.
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(e) The ATSB letter of approval, in form reasonably acceptable to
each Lender and the Borrower, shall have been provided by the Borrower.
(f) The Borrower shall have good title to the Pledged Spare Parts,
free and clear of all Liens, except, after giving effect to the Release,
Permitted Liens which are not Liens of Record, and with respect to each
Designated Location that is not owned in fee simple interest by Borrower,
free and clear of all Liens, Borrower shall have obtained from each Person
with any interest in the real property and/or the improvements thereon at
each Designated Location (whether as fee owner, landlord, tenant, ground
lessor, mortgagee, leasehold mortgagee, beneficiary of deed of trust,
beneficiary of leasehold deed of trust or otherwise), a waiver of any and
all right or interest that such Person may otherwise have in the Pledged
Spare Parts and such Person's consent, if applicable, to access by the
Security Trustee and/or any Lender or any representative of any of them to
the premises in connection with the exercise of any rights or remedies
under or pursuant to the Mortgage or the Subordinated Mortgage (in each
case, in form and substance satisfactory to the Lenders).
(g) The Security Trustee shall be entitled to the benefits of
Section 1110 of the Bankruptcy Code with respect to not less than the
Minimum 1110 Percentage (determined on the basis of Appraisal Value as of
the Closing Date) of the Rotables included within the Pledged Spare Parts
as provided in the Mortgage in the event of a case under Chapter 11 of the
Bankruptcy Code in which the Borrower is a debtor.
(h) On the Funding Date (i) the FAA Filed Documents with respect to
the Collateral shall have been duly filed for recordation (or shall be in
the process of being so duly filed for recordation) with the FAA in
accordance with the Act and (ii) each Financing Statement and each of the
UCC Termination Statements with respect to the Collateral shall have been
duly filed (or shall be in the process of being so duly filed) in the
appropriate jurisdiction.
(i) No action or proceeding shall have been instituted, nor shall
any action be threatened in writing, before any Governmental Authority,
nor shall any order, judgment or decree have been issued or proposed to be
issued by any Governmental Authority, to set aside, restrain, enjoin or
prevent the completion and consummation of this Agreement or any other
Transaction Document, Additional Document or the transactions contemplated
hereby or thereby.
(j) The representations and warranties in Sections 3.1 and 3.2 shall
be true and correct in all material respects on and as of such date
(except to the extent such representations and warranties relate solely to
an earlier date but then as of such earlier date).
(k) The Borrower shall have paid (or shall have given instructions
for the initiation of wire transfers to pay) all amounts referred to in
the first sentence of Section 9.3 for which it shall have received
reasonably detailed invoices at least two Business Days before the Funding
Date.
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(l) No payment default (without giving effect to any grace period)
by Borrower shall have occurred and be continuing under any of the AWA
Operative Documents (as defined in the Payment and Indemnity Agreement) or
any agreement to which the Borrower and any Lender or any Lender's
Subsidiaries are parties (or any agreement to which the Borrower is a
party relating to the same transaction as any such agreement).
(m) No payment default by the Borrower currently exists with respect
to any financing facility of $5,000,000 or more and the Security Trustee
and the Lenders shall have received a certification from the Borrower to
such effect.
(n) All conditions to the funding of the loan contemplated by the
Related Loan Agreement have been satisfied, and such loan is being funded
contemporaneously with the Loan.
(o) The ATSB letter of approval, in form reasonably satisfactory to
each Lender and the Borrower, shall have been provided by the Borrower.
(p) The Lenders shall have received an Appraisal (using the Physical
Appraisal Methodology) with respect to the Pledged Spare Parts from the
Independent Appraiser, satisfactory in the sole discretion of the Lenders,
confirming that the aggregate Current Market Value of the Rotables
included in the Pledged Spare Parts when multiplied by the applicable
Advance Rates set forth in Schedule 3 would be greater than or equal to
the Aggregate Commitment.
(q) Lenders shall be satisfied in respect of the Borrower's system
of inventory control.
(r) On the Funding Date after the Loan has been made, the Rotables
Ratio shall be no greater than the Maximum Rotables Ratio, and the Lenders
shall have received a certification from the Borrower to such effect,
which certification may be based upon the Current Market Value of the
Rotables included within the Pledged Spare Parts as set forth in the
Appraisal prepared by the Independent Appraiser and delivered to the
Lenders pursuant to Section 6.2(o) above, but which certification shall
include an express certification by the Borrower as to the accuracy and
completeness of all information and data provided by Borrower to the
Independent Appraiser for the preparation of such Appraisal.
(s) (1) A certificate of the Secretary or an Assistant Secretary of
the Security Trustee certifying (i) the name and signature of each officer
who executes a Transaction Document or Additional Document on the Security
Trustee's behalf, (ii) the Security Trustee's certificate of incorporation
and (iii) the Security Trustee's bylaws; and (2) a good standing
certificate of the Security Trustee from the Comptroller of the Currency.
(t) Such other documents relating to the Loan contemplated hereby as
the Security Trustee or any Lender may reasonably request.
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ARTICLE VII
EVENTS OF DEFAULT
Section 7.1. Events of Default. Each of the following events shall
constitute an "Event of Default," whether any such event shall be voluntary or
involuntary or come about or be effected by operation of law or pursuant to or
in compliance with any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body:
(a) The Borrower shall fail to make any payment of principal of or
interest on the Loan or LIBOR Breakage Costs within five Business Days
after the same shall have become due hereunder; or
(b) The Borrower shall fail to pay any other amount payable
hereunder or under any other Transaction Document when due and such
failure shall continue for a period of ten Business Days after receipt by
the Borrower of written notice that such payment is overdue given to the
Borrower by any Transaction Agent or any Lender (through the Security
Trustee); or
(c) Any representation or warranty made by the Borrower herein or
pursuant to Section 6.2(a)(iii) or any other Transaction Document or any
amendment or modification hereof or thereof or waiver hereunder or
thereunder, or in any report, certificate or other document (other than
financial statements and other documents, including exhibits, filed with
the SEC) prepared by the Borrower and furnished pursuant to or in
connection with this Agreement or any other Transaction Document or any
amendment or modification hereof or thereof or waiver hereunder or
thereunder shall prove to have been incorrect in any material respect when
made, such incorrect representation or warranty is material at the time in
question, and, if curable, the same shall remain uncured for a period in
excess of 30 days (or in the case of any representation or warranty made
in Section 3.1(g) hereof with respect to a Potential Default, 60 days)
after the date of written notice thereof from any Transaction Agent or any
Lender (through the Security Trustee); or
(d) The Borrower shall fail to perform or observe any term, covenant
or agreement contained in this Agreement or any other Transaction Document
on its part to be performed or observed and such failure shall remain
unremedied for a period of 30 days after written notice of such failure
shall have been given to the Borrower by any Transaction Agent or any
Lender (through the Security Trustee), unless such failure is capable of
being corrected and the Borrower shall be diligently proceeding to correct
such failure, in which case there shall be no Event of Default unless and
until such failure shall continue unremedied for a period of 60 days after
receipt of such notice; or
(e) The Borrower shall consent to the appointment of or the taking
of possession by a receiver, trustee or liquidator of itself or of
substantially all of its property, or the Borrower shall admit in writing
its inability to pay its debts generally as they come due, or does not pay
its debts generally as they become due or shall make a general assignment
for the benefit of creditors, or the Borrower shall file a voluntary
petition in bankruptcy or a voluntary petition or an answer seeking
reorganization,
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liquidation or other relief in a case under any bankruptcy laws or other
insolvency laws (as in effect at such time), or the Borrower shall seek
relief 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 the
Borrower's board of directors shall adopt a resolution authorizing any of
the foregoing; or
(f) An order, judgment or decree shall be entered by any court of
competent jurisdiction appointing, without the consent of the Borrower, a
receiver, trustee or liquidator of the Borrower or of substantially all of
its property, or substantially all of the property of the Borrower shall
be sequestered, and any such order, judgment or decree of appointment or
sequestration shall remain in force undismissed, unstayed and unvacated
for a period of 90 days after the date of entry thereof; or a petition
against the Borrower in a case under any 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 which may
apply to the Borrower, any court of competent jurisdiction assumes
jurisdiction, custody or control of the Borrower or of substantially all
of its property and such jurisdiction, custody or control remains in force
unrelinquished, unstayed and unterminated for a period of 90 days; or
(g) The Borrower shall fail to carry and maintain, or cause to be
carried and maintained, insurance on and in respect of any Pledged Spare
Part in accordance with the provisions of Section 3.05 of the Mortgage; or
(h) The Borrower shall cease to be a Certificated Air Carrier; or
(i) The Mortgage shall for any reason cease to be a valid first
priority perfected security interest (subject to Permitted Liens) in favor
of the Security Trustee in the Borrower's right, title and interest in and
to the Pledged Spare Parts under the laws of the United States of America;
or
(j) an "Event of Default" under the Related Loan Agreement shall
have occurred and is continuing.
then, if an Event of Default referred to in clause (e) or (f) of this Section
7.1 shall have occurred and be continuing, (x) the principal of the Loan then
outstanding, together with interest accrued but unpaid thereon, LIBOR Breakage
Costs, the Prepayment Fee (if applicable), and all other amounts owing to the
Transaction Agents and any Lender hereunder or under any other Transaction
Document, shall immediately and without further act become due and payable, and
(y) the Commitments shall automatically terminate, in each case without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived by the Borrower and, if any other Event of Default shall have
occurred and be continuing, then the Administrative Agent shall, upon request of
the Required Lenders, by notice to the Borrower, terminate the Commitments and
declare the unpaid principal of the Loans then outstanding, together with
interest accrued but unpaid thereon, LIBOR Breakage Costs and all other amounts
due to the Transaction Agents and any Lender hereunder or under any other
Transaction Document, to be
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forthwith due and payable, whereupon the Commitments shall terminate and the
Loans, all such interest and all other amounts shall become and be forthwith due
and payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by the Borrower. In addition to any
other remedies available to the Transaction Agents and the Lenders under the
Transaction Documents or at law or otherwise, if an Event of Default shall have
occurred and so long as the same shall be continuing unremedied, then and in
every such case the Security Trustee may exercise any or all of the rights and
powers and pursue any and all of the remedies set forth in the Mortgage.
ARTICLE VIII
THE TRANSACTION AGENTS
Section 8.1. Appointment and Authorization. Each Lender hereby irrevocably
designates and appoints General Electric Capital Corporation as the
"Administrative Agent", and Xxxxx Fargo Bank Northwest, National Association, as
the "Security Trustee" (collectively, the "Transaction Agents") under the
Transaction Documents and authorizes each Transaction Agent to take such actions
and to exercise such powers as are delegated to it thereby and to exercise such
other powers as are reasonably incidental thereto. No Transaction Agent shall
have any duties other than those expressly set forth in a Transaction Document
or any fiduciary relationship with any Lender, and no implied obligations or
liabilities shall be read into this Agreement, or otherwise exist, against any
Transaction Agent. The Transaction Agents do not assume, nor shall they be
deemed to have assumed, any obligation to, or relationship of trust or agency
with, the Borrower. Notwithstanding any provision of this Agreement or any other
Transaction Document, in no event shall any Transaction Agent ever be required
to take any action which exposes it to personal liability or which is contrary
to the provision of any Transaction Document or applicable law.
Section 8.2. Delegation of Duties. Each of the Transaction Agents may
execute any of its duties through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
Section 8.3. Exculpatory Provisions. No Transaction Agent nor any of their
respective directors, officers, agents or employees shall be liable to any
Lender for any action taken or omitted (i) with the consent or at the direction
of the Required Lenders or (ii) in the absence of such Person's gross negligence
or willful misconduct. No Transaction Agent shall be responsible to any Lender
or other Person for (a) any recitals, representations, warranties or other
statements made by the Borrower or any of its Affiliates, (b) the value,
validity, effectiveness, genuineness, enforceability or sufficiency of any
Transaction Document, (c) any failure of the Borrower or any of its Affiliates
to perform any obligation or (d) the satisfaction of any condition specified in
Article VI. No Transaction Agent shall have any obligation to any Lender to
ascertain or inquire about the observance or performance of any agreement
contained in any Transaction Document or to inspect the properties, books or
records of the Borrower or any of its Affiliates.
Section 8.4. Reliance by Transaction Agents. As between the Transaction
Agents and the Lenders, each of the Transaction Agents shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any document,
other writing or conversation reasonably believed
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by it to be genuine and correct and to have been signed, sent or made by the
proper Person and upon advice and statements of legal counsel (including counsel
to the Borrower or any of its Affiliates), independent accountants and other
experts selected by such Transaction Agent. Each of the Transaction Agents shall
in all cases be fully justified in failing or refusing to take any action under
any Transaction Document unless it shall first receive such advice or
concurrence of the Lenders, and assurance of its indemnification, as it deems
appropriate. Subject to Section 9.1, no Transaction Agent shall effect any
waiver or grant any consent or make any determination (except as provided in
Section 1.7(a)) without the direction of the Required Lenders.
Section 8.5. Notice of Events of Default. No Transaction Agent shall be
deemed to have knowledge or notice of the occurrence of any Potential Default
unless it has received notice from any Lender or the Borrower stating that a
Potential Default has occurred hereunder and describing such Potential Default.
Promptly upon receiving notice of the occurrence of any Potential Default, a
Transaction Agent shall notify each Lender and the other Transaction Agent of
such occurrence. The Transaction Agents shall take such action concerning a
Potential Default as may be directed by the Required Lenders (or, if required
for such action, all of the Lenders), but until a Transaction Agent receives
such directions, each Transaction Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, as such Transaction Agent deems
advisable and in the best interests of the Lenders.
Section 8.6. Non-Reliance on Transaction Agents and Other Lenders; Lender
Representations. Except as set forth in Section 3.3 with respect to the Security
Trustee, each Lender expressly acknowledges that no Transaction Agent nor any of
their respective officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by a
Transaction Agent hereafter taken, including any review of the affairs of the
Borrower or any of its Affiliates, shall be deemed to constitute any
representation or warranty by such Transaction Agent. Each Lender represents and
warrants to each of the Transaction Agents that, independently and without
reliance upon the Transaction Agents or any other Lender and based on such
documents and information as it has deemed appropriate, it has made and will
continue to make its own appraisal of and investigation into the business,
operations, property, prospects, financial and other conditions and
creditworthiness of the Borrower and its own decision to enter into this
Agreement and to take, or omit, action under any Transaction Document. Except
for items specifically required to be delivered hereunder, no Transaction Agent
shall have any duty or responsibility to provide any Lender with any information
concerning the Borrower or any of its Affiliates that comes into the possession
of such Transaction Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
Section 8.7. Transaction Agents and Affiliates. Each of the Transaction
Agents and its Affiliates may extend credit to, accept deposits from and
generally engage in any kind of business with the Borrower or any of its
Affiliates and, in its role as a Lender, General Electric Capital Corporation
may exercise or refrain from exercising its rights and powers as if it were not
Administrative Agent.
Section 8.8. Indemnification. Each Lender shall indemnify and hold
harmless each of the Transaction Agents and its officers, directors, employees,
representatives and agents (to the
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extent not reimbursed by the Borrower and without limiting the obligation of the
Borrower to do so), ratably in accordance with its Percentage Share (or, after
the Commitments have been terminated, its Ratable Share) from and against any
and all liabilities, obligations, losses, damages, penalties, judgments,
settlements, costs, expenses and disbursements of any kind whatsoever (including
in connection with any investigative or threatened proceeding, whether or not
such Transaction Agent or such Person shall be designated a party thereto) that
may at any time be imposed on, incurred by or asserted against such Transaction
Agent or such Person as a result of, or related to, any of the transactions
contemplated by the Transaction Documents or the execution, delivery or
performance of the Transaction Documents or any other document furnished in
connection therewith (but excluding any such liabilities, obligations, losses,
damages, penalties, judgments, settlements, costs, expenses or disbursements
resulting solely from the gross negligence or willful misconduct of such
Transaction Agent or such Person as finally determined by a court of competent
jurisdiction).
Section 8.9. Successor Transaction Agents. Each Transaction Agent may,
upon at least 30 days notice to the Borrower and each Lender, resign its
position as a Transaction Agent. Such resignation shall not become effective
until a successor Transaction Agent acceptable to the Borrower is appointed by
the Required Lenders and has accepted such appointment. Upon such acceptance of
its appointment as a Transaction Agent hereunder by a successor Transaction
Agent, such successor Transaction Agent shall succeed to and become vested with
all the rights and duties of the retiring Transaction Agent, and the retiring
Transaction Agent shall be discharged from its duties and obligations under the
Transaction Documents. After any retiring Transaction Agent's resignation
hereunder, the provisions of Article V and this Article VIII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was a
Transaction Agent.
Section 8.10. Qualifications of Successor Security Trustee. Any successor
Security Trustee, however appointed, shall be a bank or trust company having a
combined capital and surplus of at least $500,000,000 and be incorporated in the
United States, so long as such an institution is willing, able and legally
qualified to perform the duties of the Security Trustee hereunder upon
reasonable or customary terms.
ARTICLE IX
MISCELLANEOUS
Section 9.1. Amendments. Neither this Agreement nor any other Transaction
Document nor any terms hereof or thereof may be changed, waived, discharged or
terminated (excluding any Mortgage Supplement contemplated by the Mortgage)
unless such change, waiver, discharge or termination is in writing signed by the
Borrower and the Required Lenders, provided that no such change, waiver,
discharge or termination shall, without the consent of each Lender affected
thereby, (i) extend the final scheduled maturity of the Loan or any Note, or
reduce the rate or extend the time of payment of interest or fees thereon, or
reduce the principal amount thereof, (ii) increase the Commitment of any Lender,
(iii) release any Collateral (except as expressly provided in the Mortgage),
(iv) amend, modify or waive any provision of this Section 9.1, (v) reduce the
percentage specified in the definition of Required Lenders, (vi) consent to the
assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement or (vii) impair any indemnity under a Transaction Document
in favor of such
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Lender; provided, further, that no such change, waiver, discharge or termination
shall without the consent of a Transaction Agent, amend, modify or waive any
provision of Article VIII as same applies to such Transaction Agent or any other
provision as same relates to the rights or obligations of such Transaction
Agent.
Section 9.2. Notices. Unless otherwise specified, all notices and other
communications hereunder shall be in writing (including by facsimile
communication), given to the appropriate Person at its address or facsimile
number set forth on the signature pages hereof or at such other address or
facsimile number as such Person may specify, and effective when received at the
address specified by such Person. The number of days for any advance notice
required hereunder may be waived (orally or in writing) by the Person receiving
such notice and, in the case of notices to the Security Trustee, the consent of
each Person to which the Security Trustee is required to forward such notice.
Section 9.3. Costs and Expenses. The Borrower agrees to pay at or prior to
Closing after receipt of reasonably detailed invoices, all reasonable and actual
costs and expenses of the initial Lender and each Transaction Agent in
connection with the preparation, execution and delivery of the Transaction
Documents and Additional Documents (whether or not any such Transaction Document
or Additional Document is entered into), including, without limitation the
reasonable fees and expenses of (a) Holland & Knight LLP, special counsel to the
Lenders, (b) Weil, Gotshal & Xxxxxx, special bankruptcy counsel to the Lenders,
(c) Ray, Xxxxxxx & Xxxxxxx, special counsel to the Security Trustee, and (d)
Daugherty, Fowler, Peregrin & Xxxxxx, FAA counsel. The Borrower further agrees
to pay on demand (i) the initial and annual fees, and the reasonable expenses
of, the Security Trustee in connection with the transactions contemplated hereby
and (ii) all reasonable and actual costs and expenses of each Transaction Agent
and the Lenders, if any (including, without limitation, reasonable counsel fees
and expenses), in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of the Transaction Documents after the
occurrence of an Event of Default (including, without limitation, reasonable
fees and expenses of one counsel for the Security Trustee and one counsel for
all of the Lenders in connection with the enforcement of their rights under the
Transaction Documents).
Section 9.4. Certain Agreements . (a) Each Lender and each Transaction
Agent agrees as to itself with the Borrower that, so long as no Event of Default
shall have occurred and be continuing, such person shall not (and shall not
permit any Affiliate or other person claiming by, through or under it to) take
or cause to be taken any action contrary to the Borrower's right to quiet
enjoyment of the Collateral, and to possess, use, retain and control the Pledged
Spare Parts and all revenues, income and profits derived therefrom without
hindrance.
(b) Each Lender agrees to comply with its obligations under the Mortgage.
Section 9.5. Entire Agreement. The Transaction Documents and Additional
Documents constitute the entire understanding of the parties thereto concerning
the subject matter thereof. Any previous agreements, whether written or oral,
concerning such matters are superseded thereby.
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Section 9.6. Cumulative Rights and Severability. All rights and remedies
of the Lenders and the Transaction Agents hereunder shall be cumulative and
non-exclusive of any rights or remedies such Persons have under law or
otherwise. Any provision hereof that is prohibited or unenforceable in any
jurisdiction shall, in such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof and without affecting such provision in any other jurisdiction.
Section 9.7. Waivers. No failure or delay of any party hereto in
exercising any power, right, privilege or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right, privilege or remedy preclude any other or further exercise thereof or the
exercise of any other power, right, privilege or remedy. Any waiver hereof shall
be effective only in the specific instance and for the specific purpose for
which such waiver was given. After any waiver, the Borrower, the Lenders and the
Transaction Agents shall be restored to their former position and rights and any
Potential Default waived shall be deemed to be cured and not continuing, but no
such waiver shall extend to (or impair any right consequent upon) any subsequent
or other Potential Default.
Section 9.8. Successors and Assigns; Participations; Assignments.
(a) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors
and assigns. Except as otherwise provided herein, the Borrower may not
assign or transfer any of its rights or delegate any of its duties without
the prior consent of the Transaction Agents and each of the Lenders.
(b) Participations. Any Lender may sell to one or more Persons (each
a "Participant") participating interests in the interests of such Lender
hereunder. Such Lender shall remain solely responsible for performing its
obligations hereunder, and the Borrower and the Transaction Agents shall
continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations hereunder. Each Participant shall be
entitled to the benefits of Article V; provided that such Participant
shall not be entitled to any greater benefit under Article V than the
Lender that sold the participating interest to the Participant would have
been entitled to thereunder and no Participant shall be entitled to any
benefit thereunder unless it shall perform such obligations as are imposed
on the Lenders under Article V. A Lender shall not agree with a
Participant to restrict such Lender's right to agree to any amendment,
waiver or modification hereto, except amendments described in the proviso
to Section 9.1.
(c) Assignments. Notwithstanding the foregoing, any Lender may
assign all or a portion of its Commitment and its outstanding Notes to a
Qualified Affiliate of such Lender or assign all, or if less than all, a
portion equal to at least $5,000,000 in the aggregate face amount of Notes
and of such Commitment (and related Obligations) to one or more Eligible
Assignees, each of which assignees referred to in Section 9.8(c) shall
become a party to this Agreement as a Lender by execution of a supplement
hereto in the form of Exhibit F (a "Transfer Supplement") hereto, provided
that (i) such transfer or assignment will not be effective until recorded
by the Security Trustee on the Register pursuant to Section 9.8(d) hereof,
and (ii) the Original Series A Lender and the Original
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Series B Lender shall at all times retain, between them in the aggregate,
at least 51% of the Aggregate Loan Amount. To the extent of any assignment
pursuant to this Section 9.8(c) (other than an assignment to a Qualified
Affiliate pursuant to the preceding sentence), the assigning Lender shall
be relieved of its obligations hereunder with respect to its assigned
Commitment. At the time of each assignment pursuant to this Section 9.8(c)
to a Person which is not already a Lender hereunder, the respective
assignee Lender shall provide to the Borrower and the Security Trustee the
Internal Revenue Service forms (and, if applicable, a Certificate re
Non-Bank Status) required by Section 5.3 (c)(i).
(d) Register. The Borrower hereby designates the Security Trustee to
serve as the Borrower's agent, solely for purposes of this Section 9.8(d),
to maintain a register (the "Register") on which it will record the
registered holder of the Notes of each Series and the registration of
transfers of Notes of each Series made pursuant to and in accordance with
Section 9.8(c). The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice, and the Security Trustee shall, reasonably
promptly after (a) any person becomes a Lender after the date hereof and
(b) any Lender alters or modifies its name or address, notify the Borrower
of and deliver to the Borrower a written update of the names and addresses
of all Lenders. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of the
Loan Amount of any Lender. With respect to any Lender, the transfer of the
Commitment of such Lender and the rights to the principal of, and interest
on, the Loan Amount made pursuant to such Commitment shall not be
effective until such transfer is recorded on the Register maintained by
the Security Trustee with respect to ownership of such Commitment and Loan
Amount and prior to such recordation all amounts owing to the transferor
with respect to such Commitment and Loan Amount shall remain owing to the
transferor. The registration of assignment or transfer of all or part of
the Commitment and the Loan Amount shall be recorded by the Security
Trustee on the Register only upon the acceptance by the Security Trustee
of a properly executed and delivered Transfer Supplement. Coincident with
the delivery of such a Transfer Supplement to the Security Trustee for
acceptance and registration of assignment or transfer of all or part of a
Loan Amount, or as soon thereafter as practicable, the assigning or
transferor Lender shall surrender the Notes evidencing such Loan Amount,
and thereupon one or more new Notes of the same series of Notes in the
same aggregate principal amount shall be issued by the Borrower to the
assigning or transferor Lender and/or the new Lender, as appropriate to
reflect such assignment. Such new Notes shall be authenticated by the
Security Trustee. By execution and delivery hereof, the Borrower request
and directs the Security Trustee to authenticate and deliver the Notes to
be issued hereunder and the Security Trustee agrees to do so.
Section 9.9. Confidentiality. None of the Transaction Agents nor any
Lender shall disclose any nonpublic information relating to the Borrower
(provided to it by the Borrower) or any Transaction Document or Additional
Document to any other Person without the consent of the Borrower, other than (a)
to such Transaction Agent's or Lender's Affiliates and its officers, directors,
employees, agents and advisors and, as contemplated by Section 9.8, to actual or
prospective assignees and participants, and then, in all such cases, only with
an undertaking by
-39-
the party to whom such information is disclosed to keep such information
confidential, (b) as required by any law, rule or regulation or judicial
process, (c) as requested or required by any state, federal or foreign authority
or examiner regulating banks or banking, and (d) to the extent reasonably
necessary in connection with any dispute related to, or enforcement of, the
Transaction Documents or Additional Documents.
Notwithstanding anything to the contrary set forth herein or in any other
agreement to which the parties hereto are parties or by which they are bound,
the obligations of confidentiality contained herein and therein, as they relate
to the transactions described in the Transaction Documents and the Additional
Documents (the "Transaction"), shall not apply to the U. S. federal tax
structure or U. S. federal tax treatment of the Transaction, and each party
hereto (and any employee, representative, or agent of any party hereto) may
disclose to any and all persons, without limitation of any kind, the U. S.
federal tax structure and U. S. federal tax treatment of the Transaction. The
preceding sentence is intended to cause the Transaction to be treated as not
having been offered under conditions of confidentiality for purposes of Section
1.6011-4(b)(3) (or any successor provision) of the Treasury Regulations
promulgated under Section 6011 of the Internal Revenue Code of 1986, as amended,
and shall be construed in a manner consistent with such purpose. In addition,
each party hereto acknowledges that it has no proprietary or exclusive rights to
the U. S. federal tax structure of the Transaction or any U. S. federal tax
matter or U. S. federal tax idea related to the Transaction.Section 9.10.
Counterparts. This Agreement may be executed by different parties on any number
of counterparts, each of which shall constitute an original and all of which,
taken together, shall constitute one and the same agreement.
Section 9.11. Governing Law; Submission to Jurisdiction; Venue.
(a)This Agreement and the rights and obligations of the parties hereunder
and thereunder shall be construed in accordance with and be governed by the laws
of the State of New York. Any legal action or proceeding with respect to this
Agreement may be brought in the courts of the State of New York or the United
States for the Southern District of New York located in the Borough of
Manhattan, and, by execution and delivery of this Agreement or a Transfer
Supplement, each party hereto hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts. Each party hereto hereby further irrevocably waives any claim
that any such courts lack jurisdiction over such party, and agrees not to plead
or claim, in any legal action or proceeding with respect to this Agreement
brought in any of the aforesaid courts, that any such court lacks jurisdiction
over such party. Each party hereto further irrevocably consents to the service
of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at its address specified pursuant to Section 9.2, such
service to become effective 30 days after such mailing. Nothing herein shall
affect the right of any party hereto to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
any other party hereto in any other jurisdiction.
(b) Each party hereto hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement brought in the
courts referred to in clause (a) above and hereby further irrevocably waives and
agrees not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an inconvenient forum.
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Section 9.12. Waiver of Trial by Jury. To the extent permitted by
applicable law, each party hereto irrevocably waives all right of trial by jury
in any action, proceeding or counterclaim arising out of, or in connection with,
any Transaction Document or any matter arising thereunder.
Section 9.13. Effective Date. Although this Agreement is dated as of
September 3, 2004, it shall not be effective unless and until executed by the
parties listed on the signature pages hereto.
[Remainder of this page blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
GENERAL ELECTRIC CAPITAL CORPORATION
as the Administrative Agent
By: /s/ Xxxxxx Xxx
-------------------------------------
Name: Xxxxxx Xxx
Title: Vice President
Address:
General Electric Capital Corporation
c/o GE Capital Aviation Services, Inc.
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Customer Services
Facsimile: (000) 000-0000
email: Xxxxxxxxx@xxxxx.xxx
XXXXX FARGO BANK NORTHWEST,
NATIONAL ASSOCIATION
as the Security Trustee
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Title: Vice President
----------------------------------
Address:
Xxxxx Fargo Bank Northwest, National
Association
MAC: U1228-120
000 Xxxxx Xxxx Xxxxxx
00xx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Attention: Corporate Trust Services
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Email: xxxxxxx.xxxxxx@xxxxxxxxxx.xxx
AMERICA WEST AIRLINES, INC.
By: /s/ Xxxxxx X. Xxxx
-------------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President and Treasurer
Address:
America West Airlines, Inc.
0000 X. Xxx Xxxxxx Xxxx.
Xxxxxxx, Xxxxxxx 00000
Attention: Vice President and Treasurer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
email: xxx.xxxx@xxxxxxxxxxx.xxx
GENERAL ELECTRIC CAPITAL
CORPORATION
as Original Series A Lender
By: /s/ Xxxxxx Xxx
____________________________________
Name: Xxxxxx Xxx
Title: Vice President
GENERAL ELECTRIC CAPITAL
CORPORATION
as Original Series B Lender
By: /s/ Xxxxxx Xxx
____________________________________
Name: Xxxxxx Xxx
Title: Vice President
Notice Address and Lending Office:
General Electric Capital Corporation
c/o GE Capital Aviation Services, Inc.
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Customer Services
Facsimile: (000) 000-0000
email: Xxxxxxxxx@xxxxx.xxx
SCHEDULE 1
DEFINITIONS AND OTHER INTERPRETIVE PROVISIONS
1. Definitions. The following terms have the meanings set forth, or
referred to, below:
"Act" means part A of subtitle VII of title 49, United States Code.
"Actual Knowledge" means, with respect to (i) any Lender, actual
knowledge of any officer of such Lender having responsibility for the
transactions contemplated by the Transaction Documents and (ii) any other
Person, actual knowledge of a Vice President or more senior officer of
such Person or any other officer of such Person having responsibility for
the transactions contemplated by the Transaction Documents.
"Additional Documents" means the Payment and Indemnity Agreement,
the Subordinated Mortgage and each Subordinated Supplemental Mortgage.
"Administrative Agent" is defined in the first paragraph of this
Agreement.
"Administrative Agent's Account" means the Administrative Agent's
account number 00-000-000, reference AWA Spare Parts Loan, at Deutsche
Bank Trust Company Americas, New York branch, ABA No. 000-000-000, Swift
Code BKTRUS 33, or such other account at a bank in the United States
designated to the Borrower and the Lenders by the Administrative Agent.
"Advance Rates" has the meaning set forth on Schedule 3 to this
Agreement.
"Affected Lender" is defined in Section 1.7(c).
"Affected Loan Amount" is defined in Section 1.7(c).
"Affiliate" means, with respect to any Person, any other Person,
directly or indirectly, controlling, controlled by, or under common
control with such Person. For purposes of this definition, "control" means
the power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether through the ownership of
voting securities, by contract or otherwise, and "controlling,"
"controlled by," and "under common control with" have correlative
meanings.
"Aggregate Commitment" means $75,563,891, but in no event more than
the product, calculated as of the Funding Date, of the Current Market
Value of all Rotables included in the Pledged Spare Parts and the Advance
Rate applicable to such Rotables.
"Aggregate Loan Amount" means the sum of the Loan Amounts of all
Lenders.
"Agreement" is defined in the first paragraph of this Agreement.
1
"Applicable Margin" means (a) with respect to the Original Series A
Note and the Original Series B Note 3.0% per annum, and (b) with respect
to any Replacement Note, the percentage set forth in such Note.
"Appraisal" has the meaning set forth in the Mortgage.
"Appraisal Value" has the meaning set forth in the Mortgage.
"ATSB" means the Air Transportation Stabilization Board, or any
agency which may succeed to the rights, duties and obligations thereof
under applicable law.
"Bankruptcy Code" means Title 11 of the United States Code, as the
same may be amended.
"Borrower" is defined in the first paragraph of this Agreement.
"Borrower's Account" means initially the account set forth in
Section 1.2(a) or any subsequent account designated in writing by the
Borrower to the Security Trustee and Administrative Agent from time to
time.
"Business Day" means any day other than (i) a Saturday, Sunday or
other day on which banks in New York City or Phoenix, Arizona are
authorized or required by law to close, and (ii) with respect to all
notices and determinations in connection with, and borrowings and payments
of principal and interest on the Loan, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and
between banks in the London interbank Eurodollar market.
"Capital Adequacy Change" is defined in Section 5.2.
"Certificate re Non-Bank Status" means a certificate substantially
in the form of Exhibit G annexed hereto.
"Certificated Air Carrier" is defined in the Mortgage.
"Closing" means the time at which the Loan has been advanced to the
Borrower.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" is defined in the Mortgage.
"Commitment" means (a) with respect to the Original Series A Lender,
its Series A Commitment and (b) with respect to the Original Series B
Lender, its Series B Commitment. The aggregate amount of the Commitments
is set forth in the definition of Aggregate Commitment.
"Commitment Termination Date" means September 30, 2004.
"Current Market Value" has the meaning set forth in the Mortgage.
2
"Default Rate" is defined in Section 2.4.
"Designated Country" means the United States, the United Kingdom,
the Netherlands, Germany, France, Australia, Luxembourg, Switzerland,
Italy, Japan and Ireland.
"Designated Date" means the day coinciding with the thirtieth (30th)
monthly anniversary of the Funding Date.
"Designated Locations" means the locations in the U.S. designated
from time to time by the Borrower at which the Pledged Spare Parts may be
maintained by or on behalf of the Borrower, which initially shall be the
locations set forth on Schedule I to the Mortgage and shall include the
additional locations designated by the Company pursuant to Section 3.02(b)
of the Mortgage.
"Dollar" and "$" means lawful currency of the United States of
America.
"Eligible Assignee" means (i) prior to the termination of the
Commitments in full, a Person approved by the Borrower which approval
shall not be unreasonably withheld or delayed and which approval shall not
be required if an Event of Default shall be continuing and (ii) after the
termination of the Commitments in full, a bank or other financial
institution nominated by a Lender.
"Engine" means an engine used, or intended to be used, to propel an
aircraft, including a part, appurtenance, and accessory of the Engine.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the relations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA as in effect
at the date of this Agreement and any subsequent provisions of ERISA
amendatory thereof, supplemental thereto or substituted therefor.
"Event of Default" is defined in Section 7.1.
"Exchange Event" has the meaning set forth in the Restructure
Letter.
"Excluded Tax" of a Person means (A) any Tax imposed on all or part
of the income, profits or gains (whether worldwide, or only insofar as
such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction) of that Person, any franchise, doing business,
net worth or capital-based Tax imposed on that Person, and any intangibles
Tax or similar Tax imposed on the principal amount or value of the Loans,
by any jurisdiction (including the United States) (i) in which that Person
is organized, (ii) in which that Person's principal office or applicable
Lending Office is located, or (iii) in which that Person is subject to
such Tax as a result of that Person doing business unrelated to making a
Loan under this Agreement, (B) any Tax imposed on a transferee (including
a Participant) of a Lender or on payments to a transferee to the extent
that, under applicable law in effect on the date of the transfer to such
transferee, the amount of such Taxes exceeds the amount of such Taxes that
would have been
3
imposed on the transferor to such transferee or on payments to such
transferor and indemnified against hereunder (with appropriate adjustment
to reflect the amount of the Loan acquired by such transferee) or (C) any
Tax to the extent that liability for such Tax is caused by, and would not
have been incurred but for, (i) the gross negligence or willful misconduct
of such Person or a "related" Indemnitee (as defined in Section 5.5(a)) or
(ii) the inaccuracy of any representation of such Person in any
Transaction Document or (iii) the breach by such Person of any of its
obligations under Section 5.3(c)(i).
"FAA" means the Federal Aviation Administration of the United States
Department of Transportation, or any agency which may succeed to the
rights, duties and obligations thereof under applicable law.
"FAA Filed Documents" means the Release, the Mortgage, the
Subordinated Mortgage and any Supplemental Mortgage.
"Federal Aviation Act" means Title 49 of the United States Code
which, among other things, recodified and replaced the U.S. Federal
Aviation Act of 1958 and the regulations promulgated thereunder, or any
subsequent legislation that amends, supplements or supersedes such
provisions.
"Fee Letter" means the Fee Letter dated as of September 3, 2004,
between the Administrative Agent and the Borrower.
"Financing Statements" means Uniform Commercial Code financing
statements covering all the security interests in the Collateral created
by or pursuant to the Mortgage and Subordinated Mortgage necessary or
desirable to perfect said security interests.
"Funding Date" means September 10, 2004 (or such later date on or
prior to the Commitment Termination Date on which the Borrower requests
the Lenders to fund the Loan in accordance with Section 1.2).
"GAAP" means generally accepted accounting principles as set forth
in the statements of financial accounting standards issued by the
Financial Accounting Standards Board of the American Institute of
Certified Public Accountants, as such principles may at any time or from
time to time be varied by any applicable financial accounting rules or
regulations issued by the SEC and, with respect to any Person, means such
principles applied on a basis consistent with prior periods except as may
be disclosed in such Person's financial statements.
"Governmental Authority" means any (a) governmental entity, board,
bureau, agency or instrumentality, (b) administrative or regulatory
authority (including any central bank or similar authority) or (c) court,
judicial authority or arbitrator, in each case, whether foreign or
domestic.
"Independent Appraiser" has the meaning specified in the Mortgage.
"Independent Appraiser's Fee Amount" has the meaning set forth on
Schedule 3 to this Agreement.
4
"Interest Payment Date" means, subject to Section 1.8(b), the date
numerically corresponding to the Funding Date in each of March, June,
September and December, commencing the next such date occurring after the
Funding Date and the final such date for any Note shall be the Maturity
Date for such Note.
"Interest Period" means a period used for calculating the interest
rate applicable to the Loan, as determined pursuant to Section 2.2.
"Interest Rate Determination Date" means, with respect to any
Interest Period for a Loan, the second Business Day prior to the first day
of such Interest Period.
"Lenders" is defined in the first paragraph of this Agreement.
"Lending Office" means the lending office of each Lender set forth
on the signature page of this Agreement with respect to such Lender, or
such other lending office as a Lender from time to time shall notify the
Borrower as its lending office hereunder; provided that a Lender shall
not, without the Borrower's request, change its Lending Office if it would
increase the Borrower's obligations under Section 1.7, 5.1, 5.2 or 5.3.
"LIBOR Breakage Costs" is defined in Section 1.7(d).
"LIBOR Rate" means, with respect to any Interest Period, the rate
appearing on Bloomberg Page BBAM 1 screen service (or on any successor or
substitute page of such service, or any successor to or substitute for
such service, providing rate quotations comparable to those currently
provided on such page of such service) at approximately 11:00 a.m., London
time, on the Interest Rate Determination Date for such Interest Period, as
the rate for dollar deposits with a maturity of three months. In the event
that such rate is not available at such time for any reason, then the
"LIBOR Rate" for such Interest Period shall be the average (rounded
upwards to the nearest 1/100%), as determined by the Administrative Agent,
of the per annum interest rates at which dollar deposits of amounts
comparable to the outstanding principal amount of the Loan and for a
maturity of three months are offered by the principal London offices of
the Reference Banks, in each case offered to prime banks in the London
interbank market, in each case at or about 11:00 a.m., London time, on the
Interest Rate Determination Date for such Interest Period.
"Lien" means any mortgage, pledge, lien, charge, claim, encumbrance,
lease, sublease, sub-sublease or security interest affecting the title to
or any interest in property.
"Lien of Record" means, with respect to any Pledged Spare Parts, any
Lien that is recorded in the records of the aircraft registry maintained
by the FAA in Oklahoma City, Oklahoma in accordance with the Act (or any
successor thereto under applicable law) against property located at the
Designated Locations and having a description which would include any of
such Pledged Spare Parts.
"Loan" means the aggregate amount of funds advanced by the Lenders
to the Borrower on the Funding Date pursuant to the terms of this
Agreement.
5
"Loan Amount" means, for each Lender, the aggregate outstanding
principal amount of the Notes held by such Lender.
"Material Adverse Change" means a material adverse change in the
business or financial condition of the Borrower and its Subsidiaries taken
as a whole or the material impairment of the ability of the Borrower to
perform, or the Transaction Agents or the Lenders to enforce, the
obligations of Borrower under the Transaction Documents.
"Maturity Date" means (a) with respect to the Original Series A Note
and the Original Series B Note, the sixth (6th) anniversary of the Funding
Date, and (b) with respect to any Replacement Note, the date designated
therein as the Maturity Date.
"Maximum Self-Insurance Amount" has the meaning set forth on
Schedule 3 to this Agreement.
"Maximum Rotables Ratio" has the meaning set forth on Schedule 3 to
this Agreement.
"Minimum 1110 Percentage" has the meaning set forth on Schedule 3 to
this Agreement.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgage" means the Spare Parts Mortgage and Security Agreement in
substantially the form of Exhibit A-1 to this Agreement entered into by
the Borrower and the Security Trustee to secure the Loans.
"Note" means a Series A or Series B promissory note of the Borrower
issued in connection with a Loan made by a Lender and payable to the order
of such Lender, in substantially the form of Exhibit B hereto, evidencing
the indebtedness of the Borrower to such Lender resulting from such Loan.
"Notice of Borrowing" means a notice substantially in the form of
Exhibit C annexed hereto delivered by the Borrower to the Administrative
Agent pursuant to Section 1.2(a) with respect to a proposed borrowing.
"Obligations" is defined in the Mortgage.
"Officer's Certificate" is defined in the Mortgage.
"Original Lender" shall mean the Original Series A Lender and or the
Original Series B Lender.
"Other Taxes" means any and all present or future Taxes arising from
any payment made under any Transaction Document or from the execution,
delivery, performance, filing, recording or enforcement of, or otherwise
with respect to, any Transaction Document or the transactions contemplated
by the Transaction Documents.
6
"Participant" is defined in Section 9.8(b).
"Payment and Indemnity Agreement" means the Payment and Indemnity
Agreement [Spare Parts] dated as of the date hereof among the Borrower,
the Administrative Agent and the Security Trustee.
"Payment Date" means, subject to Section 1.8(b), the date
numerically corresponding to the Funding Date in each of March, June,
September and December, commencing with such date in December, 2004. The
final "Payment Date" for any Note shall be the Maturity Date for such
Note.
"Percentage Share" means, for each Lender, such Lender's Commitment
divided by the Aggregate Commitment.
"Permitted Disposition Amount" has the meaning set forth on Schedule
3 to this Agreement.
"Permitted Investments" is defined in the Mortgage.
"Permitted Liens" is defined in the Mortgage.
"Persons" or "persons" means individuals, firms, partnerships, joint
ventures, trusts, trustees, Governmental Authorities, organizations,
associations, corporations, limited liability companies, or any
committees, departments, authorities and other bodies thereof, corporate
or incorporate, whether having distinct legal status or not, or any member
of any of the same.
"Physical Appraisal Methodology" has the meaning set forth in the
Mortgage.
"Pledged Spare Parts" has the meaning set forth in Clause (a) of the
first paragraph of Section 2.01 of the Mortgage.
"Potential Default" means any Event of Default or any event or
condition that with the lapse of time or giving of notice, or both, would
constitute an Event of Default.
"Prepayment Date" has the meaning specified in Section 1.1(c)(i).
"Prepayment Fee" means, with respect to any prepayment of the Loan
(other than any prepayment pursuant to Section 1.1(d) or Section 1.6) on
or before the forty second monthly anniversary of the Funding Date, an
amount equal to one percent (1%) of the principal amount of the Loan so
prepaid as of the date of such prepayment.
"Qualified Affiliate" means, as to any Lender, an Affiliate of such
Lender engaged in the business of making loans.
"Ratable Share" means, for each Lender, such Lender's Loan Amount
divided by the Aggregate Loan Amount.
7
"Reference Banks" means (a) Deutsche Bank, (b) Citibank, N.A., (c)
JPMorgan Chase Bank, and (d) such other bank or banks as may from time to
time be agreed by the Borrower and the Required Lenders.
"Register" is defined in Section 9.8(d).
"Regulatory Change" is defined in Section 5.1.
"Related Loan Agreement" means that certain Loan Agreement [Engines]
dated the date hereof among the Borrower, the Administrative Agent, the
Security Trustee, the Original Series A Lender and the Original Series B
Lender.
"Release" means the Release in respect of the Collateral from the
Lien of the Spare Engine and Simulator Security Agreement, dated as of
December 12, 1997 between the Borrower and Mizuho Corporate Bank, Ltd. as
assignee from The Industrial Bank of Japan, Limited as Agent and assigned
FAA Conveyance No. K15691, as amended and assigned.
"Replacement Notes" means the Replacement Notes issued in accordance
with the terms of Section 1.11.
"Required Lenders" means Lenders having (i) Commitments in excess of
50% of the Commitment of all Lenders or (ii) if the Commitments have been
terminated, Loan Amounts in excess of 50% of the Aggregate Loan Amount.
"Restructure Letter" means the Restructure Letter [Spare Parts],
dated as of September 3, 2004, between the Administrative Agent and the
Borrower.
"Rotables" has the meaning set forth in the Mortgage.
"Rotables Ratio" has the meaning set forth in the Mortgage.
"SEC" means the Securities and Exchange Commission of the United
States, or any Governmental Authority succeeding to the functions of such
Securities and Exchange Commission.
"Security Trustee" is defined in the first paragraph of this
Agreement.
"Security Trustee Agreement" the Security Trustee Agreement [Spare
Parts] dated as of the date hereof among the Beneficiaries (as defined
therein) and the Security Trustee.
"Series" means either the Series A Notes, collectively, or the
Series B Notes, collectively.
"Series A Commitment" means the amount set forth in Schedule 3 to
this Agreement.
8
"Series B Commitment" means the amount set forth in Schedule 3 to
this Agreement.
"Series A Note" means a promissory note substantially in the form of
Exhibit B hereto designated on its face as a "Series A Note", duly
completed and executed by Borrower.
"Series B Note" means a promissory note substantially in the form of
Exhibit B hereto designated on its face as a "Series B Note", duly
completed and executed by Borrower.
"Software" has the meaning set forth in the Mortgage.
"Special Default" means any Event of Default pursuant to Section
7.1(a), and/or (b) or any event or condition that with the lapse of time
or giving of notice, or both, would constitute an Event of Default under
Section 7.1(a) and/or (b).
"Subordinated Mortgage" means the Subordinated Spare Parts Mortgage
and Security Agreement in substantially the form of Exhibit A-2 to this
Agreement entered into by the Borrower and the Security Trustee to secure
the obligations of the Borrower under the Payment and Indemnity Agreement.
"Subordinated Supplemental Mortgage" is defined in the Subordinated
Mortgage.
"Subsidiary" means, as to any Person, any other Person of which at
least a majority of the voting stock (or equivalent equity interests) is
owned or controlled by such first Person or by one or more other
Subsidiaries.
"Substitute Basis" is defined in Section 1.7(f).
"Supplemental Mortgage" means a supplement to the Mortgage
substantially in the form of Exhibit A to the Mortgage.
"Taxes" means all taxes, charges, fees, levies or other assessments
(including income, gross receipts, profits, withholding, excise, property,
sales, use, license, occupation and franchise taxes and including any
related interest, penalties or other additions) imposed by any
jurisdiction or taxing authority (whether international, foreign or
domestic).
"Threshold Amount" has the meaning set forth in Schedule 3 to this
Agreement.
"Transaction Agents" is defined in Section 8.1 hereof.
"Transaction Documents" means this Agreement, the Notes, the
Mortgage and each Mortgage Supplement, the Restructure Letter, the Fee
Letter and the Waiver Letter.
"Transfer Supplement" is defined in Section 9.8(c).
9
"UCC" or "Uniform Commercial Code" means the Uniform Commercial Code
as in effect in any applicable jurisdiction.
"UCC Termination Statements" means the Delaware UCC Termination
Statement in respect of the UCC Financing Statement 32330408 relating to
the Collateral subject to the Lien of the Spare Engine and Simulator
Security Agreement, dated as of December 12, 1997, between the Borrower
and Mizuho Corporate Bank, Ltd. as assignee from The Industrial Bank of
Japan, Limited as Agent.
"USA" means the United States of America (including all states and
political subdivisions thereof).
"Waiver Letter" means the Waiver Letter, dated as of the Funding
Date, among the Administrative Agent, the Security Trustee, the
Subordinated Trustee and the Borrower.
2. Other Interpretive Provisions. (a) The foregoing definitions shall
be equally applicable to both the singular and plural forms of the defined
terms. All terms defined directly or by incorporation in this Agreement shall
have the defined meanings when used in any certificate or other document
delivered pursuant hereto unless otherwise defined therein. For purposes of this
Agreement and all such certificates and other documents, unless the context
otherwise requires: (i) accounting terms not otherwise defined in this
Agreement, and accounting terms partly defined in this Agreement to the extent
not defined, shall have the respective meanings given to them under GAAP; (ii)
references to any amount as on deposit or outstanding on any particular date
means such amount at the close of business on such day; (iii) the words
"hereof," "herein" and "hereunder" and words of similar import refer to this
Agreement (or the certificate or other document in which they are used) as a
whole and not to any particular provision of this Agreement (or such certificate
or document); (iv) references to any Section, Schedule or Exhibit are references
to Sections, Schedules and Exhibits in or to this Agreement (or the certificate
or other document in which the reference is made), and references to any
paragraph, subsection, clause or other subdivision within any Section or
definition refer to such paragraph, subsection, clause or other subdivision of
such Section or definition; (v) the term "including" means "including without
limitation"; (vi) references to any law or regulation refer to that law or
regulation as amended from time to time and include any successor law or
regulation; (vii) references to any agreement refer to that agreement as from
time to time amended or supplemented or as the terms of such agreement are
waived or modified in accordance with its terms; (viii) references to any Person
include that Person's successors and assigns; and (ix) headings are for
convenience of reference only and shall not otherwise affect the meaning or
interpretation of any provision hereof.
(b) Each exhibit and schedule to this Agreement is incorporated in, and
shall be deemed a part of, this Agreement.
(c) All terms defined in the Mortgage and used herein have such respective
defined meanings unless otherwise defined herein.
10
SCHEDULE 2
[OMITTED]
1
SCHEDULE 3
Certain Information
"Advance Rate" means the following percentages in respect of the Current
Market Value of Rotables included in the Pledged Spare Parts and maintained for
the respective airframe type:
AIRFRAME TYPE ADVANCE RATE
B737-100/200 0%
B737-300 40%
B757-200 35%
A319 70%
A320 70%
"Independent Appraiser's Fee Amount" means $94,000, subject to increase
from time to time in the event that the fees charged by the Independent
Appraiser are increased due to (i) changes in the overall number of Designated
Locations, (ii) changes in the relative percentage (determined on the basis of
Appraisal Value) of Pledged Spare Parts stored at each Designated Location,
(iii) changes in the locations of Designated Locations, whether within the
United States or outside, and/or (iv) any other material changes in Borrower's
operations or spares inventory or spares inventory management systems that
increase the cost to the Independent Appraiser of performing its duties under
the Mortgage.
"Maximum Self Insurance Amount" means the standard market spares
deductible in existence from time to time in the worldwide airline insurance
marketplace, but in no event greater than $100,000, any one occurrence.
"Maximum Rotables Ratio" means fifty-four percent (54%).
"Minimum 1110 Percentage" means fifty-five percent (55%).
"Minimum Liability Amount" means $600,000,000.
"Permitted Disposition Amount" means $1,000,000.
"Series A Commitment" means $75,563,891.
"Series B Commitment" means $0.
"Threshold Amount" means $2,000,000.
1
EXHIBIT A-1
[Insert Form of Mortgage]
EXHIBIT A-2
[Insert Form of Subordinated Mortgage]
EXHIBIT B
FORM OF PROMISSORY NOTE
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR UNDER THE SECURITIES OR SIMILAR LAWS OF ANY STATE OR OTHER
JURISDICTION AND MAY NOT BE OFFERED, TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE SUCH A REGISTRATION UNDER THE ACT AND SUCH SECURITIES OR SIMILAR
LAWS IS IN EFFECT OR PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION.
THIS NOTE IS SUBJECT TO CERTAIN ADDITIONAL RESTRICTIONS ON TRANSFER SET FORTH IN
SECTION 9.8 OF THE LOAN AGREEMENT REFERRED TO BELOW.
SERIES [*] NOTE [SPARE PARTS] DUE SEPTEMBER [__], 2010
No. [*] - New York, New York
_______, 200[]
$____________________________
FOR VALUE RECEIVED, the undersigned, AMERICA WEST AIRLINES, INC., a
Delaware corporation (together with its successors and permitted assigns, the
"Borrower") hereby unconditionally promises to pay to _____________, or the
registered assignee thereof, the principal amount of ______________ DOLLARS
($_________), in lawful currency of the United States of America, in full on the
Maturity Date, and to pay interest in arrears on each Interest Payment Date at
the Debt Rate (as defined herein below) for the Interest Period ending on such
Interest Payment Date on the amount of such principal amount remaining unpaid
from time to time from the date hereof until such principal amount is paid in
full; provided that in the event (i) that this Note shall have been prepaid in
part pursuant to the Loan Agreement, from and after the relevant Prepayment
Date, the amounts of such installments shall be reduced, in inverse order of
maturity, by the amount of such partial prepayment and (ii) of any repayment or
prepayment of any principal amount hereof, accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment; and provided further that the final principal payment hereon shall
in any and all events equal the then outstanding principal balance hereof and
such final payment shall discharge all amounts due under this Note. Interest
shall be computed on the basis of a year of 360 days and the actual days elapsed
(including the first day but excluding the last day) in the period for which
interest is payable. The Applicable Margin for this Note is []% per annum. As
used herein, the term "Debt Rate" means the LIBOR Rate for the relevant Interest
Period plus the Applicable Margin, unless the Substitute Basis shall have become
applicable pursuant to Section 1.7 of the Loan Agreement, in which case the
"Debt Rate" shall mean the sum of the Substitute Basis and the Applicable
Margin.
Notwithstanding the foregoing, this Note shall bear interest at the
Default Rate on overdue principal and, to the extent permitted by applicable
law, on any interest and any other
1
amounts payable hereunder not paid when due and payable for any period during
which the same shall be overdue, payable on demand by the holder hereof.
This Note is one of the Notes referred to in, and is entitled to the
benefits of, the Loan Agreement [Spare Parts] dated as of September 3, 2004,
among the Borrower, General Electric Capital Corporation, as Administrative
Agent, Xxxxx Fargo Bank Northwest, National Association, as Security Trustee,
General Electric Capital Corporation, as Original Series A Lender, and General
Electric Capital Corporation, as Original Series B Lender and the Lenders from
time to time party thereto (as amended or modified from time to time, the "Loan
Agreement"; the terms defined therein being used herein as therein defined). The
Loan Agreement, among other things, (i) provides for the making of a Series A
Loan and/or a Series B Loan by the Lenders to the Borrower on the Funding Date
and (ii) contains provisions for acceleration of the maturity hereof upon the
happening of certain stated events and also prepayments on account of principal
hereof prior to the maturity hereof upon the terms and conditions therein
specified. The obligations of the Borrower under this Note and the Loan
Agreement are secured by collateral as provided in the Spare Parts Mortgage and
Security Agreement (as amended or supplemented from time to time) dated as of
September 3, 2004, executed by the Borrower and Xxxxx Fargo Bank Northwest,
National Association, as Security Trustee (the "Mortgage").
Each holder hereof, by its acceptance of this Note, agrees that each
payment received by it hereunder shall be applied, first, to the payment of any
amount (other than principal of or interest on this Note) then due in respect of
this Note, including, without limitation, LIBOR Breakage Costs, if any; second,
to the payment of accrued interest on this Note (as well as any interest on
overdue principal, or, to the extent permitted by law, on LIBOR Breakage Costs,
if any, on interest and on other amounts due hereunder) due and payable to the
date of such payment; and third, to the payment of principal then due hereunder
(applied, in the case of a partial prepayment, in inverse order of maturity).
There shall be maintained a Note Register for the purpose of registering
transfers and exchanges of Notes at the Corporate Trust Office of the Security
Trustee or at the office of any successor security trustee in the manner
provided in Section 9.8(d) of the Loan Agreement. As provided in the Loan
Agreement and subject to certain limitations therein set forth, the Notes may be
assigned, and the Notes are exchangeable for a like aggregate original principal
amount of Notes of different authorized denominations, as requested by the
Lender surrendering the same.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Security Trustee by manual signature, this Note shall not be
entitled to any benefit under the Loan Agreement or the Mortgage or be valid or
obligatory for any purpose.
-2-
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF
THE STATE OF NEW YORK.
AMERICA WEST AIRLINES, INC.
By:_________________________
Name:
Title:
SECURITY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Loan
Agreement and Mortgage.
XXXXX FARGO BANK NORTHWEST,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Security Trustee
By: __________________________________
Name:
Title:
EXHIBIT C
FORM OF NOTICE OF BORROWING
NOTICE OF BORROWING
General Electric Capital Corporation
as Administrative Agent
Attention: [_______________] _______________, 2004
Ladies and Gentlemen:
We refer to the Loan Agreement [Spare Parts] dated as of September 3,
2004, among America West Airlines, Inc., General Electric Capital Corporation,
as Administrative Agent, Xxxxx Fargo Bank Northwest, National Association, as
Security Trustee, General Electric Capital Corporation, as Original Series A
Lender and as Original Series B Lender and the Lenders from time to time party
thereto (as amended or modified from time to time, the "Loan Agreement"; the
terms defined therein being used herein as therein defined). We hereby give you
notice requesting a Loan pursuant to Section 1.2(a) of the Loan Agreement, and
in that connection we set forth below the required information relating to such
Loan (the "Proposed Loan"):
(1) The Funding Date on which the Proposed Loan shall be made is
_______________.
(2) The aggregate principal amount of the Proposed Loan is
$_______________.
Very truly yours,
AMERICA WEST AIRLINES, INC.
By:___________________________
Name:
Title:
EXHIBIT D
[Insert Form of Opinion of Special Counsel to Borrower]
EXHIBIT E
[Insert Form of Opinion of Borrower's Legal Department]
EXHIBIT F
FORM OF TRANSFER SUPPLEMENT
Date __________, ____
Reference is made to the Agreement described in Item 2 of Annex I hereto
(as such Loan Agreement may hereafter be amended, supplemented or otherwise
modified from time to time, the "Loan Agreement"). Unless defined in Annex I
hereto, terms defined in the Loan Agreement are used herein as therein defined.
___________ (the "Assignor") and __________ (the "Assignee") hereby agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee without recourse
and without representation or warranty (other than as expressly provided
herein), and the Assignee hereby purchases and assumes from the Assignor, that
interest in and to all of the Assignor's rights and obligations under the Loan
Agreement as of the date hereof which represents the percentage interest
specified in Item 4 of Annex I hereto (the "Assigned Share") of all of the
outstanding rights and obligations under the Loan Agreement relating to the
Loans and Commitments listed in Item 4 of Annex I hereto. After giving effect to
such sale and assignment, the amount of the outstanding Loans owing to the
Assignee will be as set forth in Item 4 of Annex I hereto.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Agreement
or the other Transaction Documents or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Agreement or the
other Transaction Documents or any other instrument or document furnished
pursuant thereto; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any party to the
Transaction Documents or the performance or observance by any party to the
Transaction Documents of any of their respective obligations under the Loan
Agreement or the other Transaction Documents to which they are a party or any
other instrument or document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy of the Loan
Agreement and the other Transaction Documents, together with copies of the
financial statements referred to therein and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Transfer Supplement; (ii) agrees that it will,
independently and without reliance upon the Transaction Agents, the Assignor or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Agreement; (iii) confirms that it is an
Eligible Assignee under Section 9.8(c) of the Loan Agreement; (iv) appoints and
authorizes the Transaction Agents to take such action as an agent on its behalf
and to exercise such powers under the Loan Agreement and the other Transaction
Documents as are delegated to the Transaction Agents, as the case may be, by the
terms thereof,
together with such powers as are reasonably incidental thereto; (vi) agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Loan Agreement are required to be performed by it as a Lender;
(vii) makes the representations and warranties contained in Section 3.4 of the
Loan Agreement[; and (viii) attaches the forms described in Sections 5.3(c) and
9.8(c) of the Loan Agreement.](1)
4. Following the execution of this Transfer Supplement by the Assignor and
the Assignee, an executed original hereof (together with all attachments) will
be delivered to the Security Trustee. This Transfer Supplement shall be
effective, unless a later date is otherwise specified in Item 5 of Annex I
hereto (the "Settlement Date"), upon the date upon which each of the following
conditions shall have been satisfied: (i) each of the Assignor and Assignee
shall have executed a copy hereof and delivered the same to the other party,
(ii) the registration of the transfer on the Register as provided by Section
9.8(d) of the Loan Agreement and (iii) receipt by the Assignee of such other
documentation or fees specified on Item 9 of Annex I hereto.
5. Upon the delivery of a fully executed original hereof to the Security
Trustee, as of the Settlement Date of this Transfer Supplement, (i) the Assignee
shall be a party to the Loan Agreement and, to the extent provided in this
Transfer Supplement, have the rights and obligations of a Lender thereunder and
under the other Transaction Documents and (ii) the Assignor shall, to the extent
provided in this Transfer Supplement, relinquish its rights and be released from
its obligations under the Loan Agreement and the other Transaction Documents.
6. It is agreed that the Assignee shall be entitled to all interest on the
Assigned Share of the Loans at the rates specified in Item 6 of Annex I which
are paid by the Borrower on and after the Settlement Date, such interest to be
paid by the Security Trustee directly to the Assignee. It is further agreed that
all payments of principal made on the Assigned Share of the Loans which occur on
and after the Settlement Date will be paid directly by the Security Trustee to
the Assignee. Upon the Settlement Date, the Assignee shall pay to the Assignor
an amount specified by the Assignor in writing which represents the Assigned
Share of the principal amount of the Loans pursuant to the Loan Agreement which
are outstanding on the Settlement Date, and which are being assigned hereunder.
The Assignor and the Assignee shall make all appropriate adjustments in payments
under the Loan Agreement for periods prior to the Settlement Date directly
between themselves.
7. The Borrower is an intended third party beneficiary of, and may
enforce, this Transfer Supplement.
8. THIS TRANSFER SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
----------
(1.) Include if the Assignee is organized under the laws of a jurisdiction
outside of the United States.
-2-
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Transfer Supplement, as of the date first
above written, such execution also being made on Annex I hereto.
[NAME OF ASSIGNOR],
as Assignor
By ___________________________
Title:
[NAME OF ASSIGNEE],
as Assignee
By ___________________________
Title:
Acknowledged and Agreed:
XXXXX FARGO BANK NORTHWEST, NATIONAL ASSOCIATION
as Security Trustee
By __________________________________
Name:
Title:
-3-
ANNEX FOR TRANSFER SUPPLEMENT
ANNEX I
1. Borrower: America West Airlines, Inc.
2. Name and Date of Loan Agreement:
Loan Agreement [Spare Parts], dated as of September 3, 2004, among America
West Airlines, Inc., as Borrower, General Electric Capital Corporation, as
Administrative Agent, Xxxxx Fargo Bank Northwest, National Association, as
Security Trustee, General Electric Capital Corporation, as Original Series
A and Series B Lender, and the Lenders from time to time party thereto.
3. Date of Assignment Agreement:
4. Amounts (as of date of Item 3 above):
Outstanding Principal Aggregate
of Loan Commitment
--------------------- ----------
a. Aggregate Amount
for all Lenders $__________ $__________
b. Assigned Share
c. Amount of
Assigned Share $__________ $__________
5. Settlement Date:
6. Rate of Interest to the As set forth in Section 2.1 of the
Assignee: Loan Agreement (unless otherwise
agreed to by the Assignor and the
Assignee)*
----------
* The Borrower and the Security Trustee shall direct the entire amount of
the interest to the Assignee at the rate set forth in Section 2.1 of the
Loan Agreement, with the Assignor and Assignee effecting the agreed upon
sharing of the interest through payments by the Assignee to the Assignor.
7. Notice and Lending Office:
ASSIGNOR:
______________________
______________________
______________________
______________________
Attention:
Telephone:
Telecopier:
ASSIGNEE:
______________________
______________________
______________________
______________________
Attention:
Telephone:
Telecopier:
8. Payment Instructions:
ASSIGNOR:
______________________
______________________
______________________
______________________
Attention:
Reference:
ASSIGNEE:
______________________
______________________
______________________
______________________
Attention:
Reference:
-2-
9. Other Documents or Fees for Closing (if any):
Acknowledged and Agreed:
[NAME OF ASSIGNEE] [NAME OF ASSIGNOR]
By ____________________________ By __________________________
________________________________ _____________________________
(Print Name and Title) (Print Name and Title)
EXHIBIT G
FORM OF CERTIFICATE RE NON-BANK STATUS
CERTIFICATE RE NON-BANK STATUS
Reference is hereby made to the Loan Agreement [Spare Parts], dated as of
September 3, 2004, among America West Airlines, Inc., General Electric Capital
Corporation, as Administrative Agent, Xxxxx Fargo Bank Northwest, National
Association, as Security Trustee, General Electric Capital Corporation, as
Original Series A Lender, and General Electric Capital Corporation, as Original
Series B Lender and the Lenders from time to time party thereto (as amended or
modified from time to time, the "Loan Agreement"). Pursuant to the provisions of
Section 5.3(c) of the Loan Agreement, the undersigned hereby certifies that (i)
it is not a "bank" as such term is used in Section 881(c)(3)(A) of the Internal
Revenue Code of 1986, as amended (the "Code"), (ii) it is not a controlled
foreign corporation (within the meaning of Section 957(a) of the Code) related
(within the meaning of Section 864(d)(4) of the Code) to the Borrower, and (iii)
it is not a 10% shareholder (within the meaning of Section 871(h)(3)(B) of the
Code) of the Borrower.
[NAME OF LENDING INSTITUTION]
By ________________________________
Title:_______________________
Date: _______________________
EXHIBIT H
[Insert Form of FAA Counsel's Opinion]
