Exhibit 4.13
INTERCREDITOR AGREEMENT
dated as of August 22, 2001
between
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Trustee under the
United Airlines 2001-1A-1 Pass Through Trust,
United Airlines 2001-1A-2 Pass Through Trust,
United Airlines 2001-1A-3 Pass Through Trust,
United Airlines 2001-1B Pass Through Trust,
United Airlines 2001-1C Pass Through Trust, and
United Airlines 2001-1D Pass Through Trust
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
ACTING THROUGH ITS NEW YORK BRANCH
as Class A-1 Liquidity Provider,
Class A-2 Liquidity Provider,
Class A-3 Liquidity Provider,
Class B Liquidity Provider, and
Class C Liquidity Provider
and
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity except
as expressly set forth herein but
solely as Subordination Agent
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS................................................................................. 2
1.1 Definitions.................................................................................... 2
ARTICLE II TRUST ACCOUNTS; CONTROLLING PARTY........................................................... 22
2.1 Agreement to Terms of Subordination; Payments from Monies Received Only........................ 22
2.2 Trust Accounts................................................................................. 22
2.3 Deposits to the Collection Account and Special Payments Account................................ 23
2.4 Distributions of Special Payments.............................................................. 24
2.5 Designated Representatives..................................................................... 26
2.6 Controlling Party.............................................................................. 27
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED................................... 28
3.1 Written Notice of Distribution................................................................. 28
3.2 Distribution of Amounts on Deposit in the Collection Account................................... 30
3.3 Distribution of Amounts on Deposit Following a Triggering Event................................ 32
3.4 Other Payments................................................................................. 34
3.5 Payments to the Trustee and the Liquidity Providers............................................ 34
3.6 Liquidity Facilities........................................................................... 35
ARTICLE IV EXERCISE OF REMEDIES........................................................................ 43
4.1 Directions from the Controlling Party.......................................................... 43
4.2 Remedies Cumulative............................................................................ 44
4.3 Discontinuance of Proceedings.................................................................. 44
4.4 Right of Certificateholders to Receive Payments Not to Be Impaired............................. 44
4.5 Undertaking for Costs.......................................................................... 44
ARTICLE V DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC.............................. 44
5.1 Notice of Indenture Default or Triggering Event................................................ 45
5.2 Indemnification................................................................................ 45
5.3 No Duties Except as Specified in Intercreditor Agreement....................................... 45
5.4 Notice from the Liquidity Providers and Trustee................................................ 46
ARTICLE VI THE SUBORDINATION AGENT..................................................................... 46
6.1 Acceptance of Trusts and Duties................................................................ 46
6.2 Absence of Duties.............................................................................. 46
6.3 No Representations or Warranties as to Documents............................................... 46
6.4 No Segregation of Monies; No Interest.......................................................... 46
6.5 Reliance; Agents; Advice of Counsel............................................................ 47
6.6 Capacity in Which Acting....................................................................... 47
6.7 Compensation................................................................................... 47
6.8 May Become Certificateholder................................................................... 47
6.9 Subordination Agent Required; Eligibility...................................................... 47
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TABLE OF CONTENTS
(continued)
Page
6.10 Money to Be Held in Trust...................................................................... 48
ARTICLE VII [RESERVED].................................................................................. 48
ARTICLE VIII SUCCESSOR SUBORDINATION AGENT............................................................... 48
8.1 Replacement of Subordination Agent; Appointment of Successor................................... 48
ARTICLE IX SUPPLEMENTS AND AMENDMENTS.................................................................. 49
9.1 Amendments, Waivers, etc....................................................................... 49
9.2 Subordination Agent Protected.................................................................. 50
9.3 Effect of Supplemental Agreements.............................................................. 50
9.4 Copy to Rating Agencies........................................................................ 51
ARTICLE X MISCELLANEOUS............................................................................... 51
10.1 Termination of Intercreditor Agreement......................................................... 51
10.2 Intercreditor Agreement for Benefit of Trustee, Liquidity Providers and Subordination Agent.... 51
10.3 Notices........................................................................................ 51
10.4 Severability................................................................................... 52
10.5 No Oral Modifications or Continuing Waivers.................................................... 52
10.6 Successors and Assigns......................................................................... 53
10.7 Headings....................................................................................... 53
10.8 Counterpart Form............................................................................... 53
10.9 Subordination.................................................................................. 53
10.10 GOVERNING LAW.................................................................................. 54
10.11 Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Indemnity.......................... 54
SCHEDULE 1 INDENTURES
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INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT, dated as of August 22, 2001, between STATE
STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national
banking association ("State Street"), not in its individual capacity but solely
as Trustee of each Trust (each as defined below), WESTDEUTSCHE LANDESBANK
GIROZENTRALE, a German banking institution organized under the laws of the State
of North Rhine-Westphalia, acting through its New York branch, as the Class A-1
Liquidity Provider, the Class A-2 Liquidity Provider, the Class A-3 Liquidity
Provider, the Class B Liquidity Provider and the Class C Liquidity Provider and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not in
its individual capacity except as expressly set forth herein, but solely as
Subordination Agent hereunder (in such capacity, together with any successor
appointed pursuant to Article VIII, the "Subordination Agent").
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WHEREAS, all capitalized terms used and not otherwise defined herein shall
have the respective meanings referred to in Article I;
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WHEREAS, pursuant to the Indentures covering ten (10) Airbus A319-131
aircraft, six (6) Airbus A320-232 aircraft, five (5) Boeing 747-422 aircraft,
five (5) Boeing 767-322ER aircraft and four (4) Boeing 777-222ER aircraft owned
by United, United proposes to issue on a recourse basis up to six series of
Notes for general corporate purposes;
WHEREAS, pursuant to the Note Purchase Agreement, each Trust will acquire
those Notes having an interest rate equal to the interest rate applicable to the
Certificates to be issued by such Trust;
WHEREAS, pursuant to each Trust Agreement executed and delivered from time
to time, the Trust created thereby proposes to issue a single class of
Certificates (each, a "Class"), designated as Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class B Certificates, Class C Certificates
or Class D Certificates bearing the interest rate and having the final
distribution date described in such Trust Agreement on the terms and subject to
the conditions set forth therein;
WHEREAS, pursuant to the Underwriting Agreement, on the Closing Date the
Underwriters propose to purchase the Class A-1 Certificates, the Class A-2
Certificates, the Class A-3 Certificates, the Class B Certificates, the Class C
Certificates and Class D Certificates issued by the related Trust in the
aggregate face amount set forth opposite the name of such Trust on Schedule I
thereto on the terms and subject to the conditions set forth therein;
WHEREAS, the Class A-1 Liquidity Provider proposes to enter into a
revolving credit agreement relating to the Class A-1 Certificates, the Class A-2
Liquidity Provider proposes to enter into a revolving credit agreement relating
to the Class A-2 Certificates, the Class A-3 Liquidity Provider proposes to
enter into a revolving credit agreement relating to the Class A-3 Certificates,
the Class B Liquidity Provider proposes to enter into a revolving credit
agreement relating to the Class B Certificates and the Class C Liquidity
Provider proposes to enter into a revolving credit agreement relating to the
Class C Certificates (each, a "Liquidity Facility"), in
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each case with the Subordination Agent, as agent for the Trustee of the Class
A-1 Trust, the Class A-2 Trust, the Class A-3 Trust, the Class B Trust or the
Class C Trust, as applicable, for the benefit of the Certificateholders of each
such Trust; and
WHEREAS, it is a condition precedent to the obligations of the Underwriters
under the Underwriting Agreement that the Subordination Agent, the Trustees and
the Liquidity Providers agree to the terms of subordination set forth in this
Agreement in respect of each Class of Certificates, and the Subordination Agent,
the Trustees and the Liquidity Providers, by entering into this Agreement,
hereby acknowledge and agree to such terms of subordination and the other
provisions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
and of other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. For all purposes of this Agreement, except as otherwise
-----------
expressly provided or unless the context otherwise requires:
(a) the terms used herein that are defined in this Article I have the
---------
meanings assigned to them in this Article I, and include the plural as well as
---------
the singular;
(b) all references in this Agreement to designated "Articles,"
"Sections" and other subdivisions are to the designated Articles, Sections and
other subdivisions of this Agreement;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision; and
(d) the term "including" means "including without limitation".
"Acceleration" means, with respect to the amounts payable in respect
------------
of the Notes issued under any Indenture, such amounts to be immediately due and
payable by declaration or otherwise. "Accelerate," "Accelerated" and
---------- -----------
"Accelerating" have meanings correlative to the foregoing.
------------
"Additional Payment" means a payment of Make-Whole Amount, if any.
------------------
"Adjusted Expected Distributions" means, with respect to the
-------------------------------
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates and (y) the greater of:
(A) the difference between (x) the Pool Balance of such Certificates
as of the preceding Distribution Date (or, if the Current Distribution Date is
the first Distribution Date, the
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original aggregate face amount of the Certificates of such Trust) and (y) the
Pool Balance of such Certificates as of the Current Distribution Date calculated
on the basis that (i) the principal of the Non-Performing Equipment Notes held
in such Trust has been paid in full and such payments have been distributed to
the holders of such Certificates and (ii) the principal of the Performing
Equipment Notes held in such Trust has been paid when due (but without giving
effect to any Acceleration of any thereof) and such payments have been
distributed to the holders of such Certificates; and
(B) the amount of the excess, if any, of (i) the Pool Balance of such
Class of Certificates as of the preceding Distribution Date (or, if the Current
Distribution Date is the first Distribution Date, the original aggregate face
amount of the Certificates of such Trust), over (ii) the Aggregate LTV
Collateral Amount for such Class of Certificates for the Current Distribution
Date;
provided, however, that, until the date of the initial LTV Appraisals, clause
-------- ------- ------
(B) shall not apply.
---
For purposes of calculating Adjusted Expected Distributions with respect to the
Certificates of any Trust, any Additional Payment paid on the Notes held in such
Trust that has not been distributed to the Certificateholders of such Trust
(other than such Additional Payment or a portion thereof applied to the payment
of interest on the Certificates of such Trust or the reduction of the Pool
Balance of such Trust) shall be added to the amount of Adjusted Expected
Distributions.
"Advance" means, with respect to any Liquidity Facility, any Advance as
-------
defined in such Liquidity Facility.
"Affiliate" means, with respect to any Person, any other Person directly or
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indirectly controlling, controlled by or under common control with such Person.
For the 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 or by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Aggregate LTV Collateral Amount" for any Class of Certificates for any
-------------------------------
Distribution Date means the product of (A)(i) the sum of the applicable LTV
Collateral Amounts for all Aircraft, minus (ii) the Pool Balance for each Class
of Certificates, if any, senior to such Class, after giving effect to any
distribution of principal on such Distribution Date with respect to such senior
Class or Classes, multiplied by (B)(i) in the case of the Class A-1
Certificates, Class A-2 Certificates or Class A-3 Certificates, a fraction the
numerator of which equals the Current Pool Balance for the Class A-1
Certificates, Class A-2 Certificates or Class A-3 Certificates, as the case may
be, and the denominator of which equals the aggregate Current Pool Balance for
the Class A-1 Certificates, the Class A-2 Certificates and the Class A-3
Certificates, and (ii) in the case of the Class B Certificates, the Class C
Certificates and the Class D Certificates, 1.0.
"Aircraft" means, with respect to each Indenture, the "Aircraft" referred
--------
to therein.
"Appraisal" means a fair market value appraisal (which may be a "desktop"
---------
appraisal) performed by any Appraiser or any other nationally recognized
appraiser on the basis of an
3
[2001-1 Intercreditor Agreement]
arm's-length transaction between an informed and willing purchaser under no
compulsion to buy and an informed and willing seller under no compulsion to sell
and both having knowledge of all relevant facts.
"Appraised Current Market Value" of any Aircraft means the appraised value
------------------------------
equal to the lower of the average and the median of the appraised values taken
from three of the most recent Appraisals of such Aircraft.
"Appraisers" means, collectively, Aircraft Information Services, Inc.,
----------
Xxxxxx Xxxxx & Xxxxx, Inc. and AvSolutions Inc.
"Available Amount" means, with respect to any Liquidity Facility on any
----------------
drawing date, subject to the proviso contained in the first sentence of Section
3.6(g) hereof, an amount equal to (a) the Stated Amount of such Liquidity
Facility at such time, less (b) the aggregate amount of each Interest Drawing
----
honored by the Liquidity Provider under such Liquidity Facility on or prior to
such date that has not been reimbursed or reinstated as of such date; provided,
--------
however, that, following a Downgrade Drawing, a Non-Extension Drawing or a Final
-------
Drawing under such Liquidity Facility, the Available Amount of such Liquidity
Facility shall be zero.
"Bankruptcy Code" has the meaning assigned to such term in the definition
---------------
of "Performing Equipment Note" in this Section 1.1.
-----------
"Basic Pass Through Trust Agreement" with respect to any Trust, means the
----------------------------------
Pass Through Trust Agreement, dated as of August 22, 2001, between United and
State Street, as the same may from time to time be supplemented, amended or
modified, but does not include any Trust Supplement.
"Business Day" means any day (i) other than a Saturday or Sunday or a day
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on which commercial banks are required or authorized to close in Chicago,
Illinois, New York, New York or the city and state in which any Trustee, the
Subordination Agent or any Indenture Trustee maintains its Corporate Trust
Office or receives and disburses funds, and (ii) that, solely with respect to
draws under any Liquidity Facility, also is a "Business Day" as defined in such
Liquidity Facility.
"Cash Collateral Account" means the Class A-1 Cash Collateral Account, the
-----------------------
Class A-2 Cash Collateral Account, the Class A-3 Cash Collateral Account, the
Class B Cash Collateral Account or the Class C Cash Collateral Account, as
applicable.
"Certificate" means a Class A-1 Certificate, a Class A-2 Certificate, a
-----------
Class A-3 Certificate, a Class B Certificate, a Class C Certificate or a Class D
Certificate, as applicable.
"Certificated Air Carrier" means a Citizen of the United States holding an
------------------------
air carrier operating certificate issued by the Secretary of Transportation
pursuant to Chapter 447 of Title 49 of the United States Code, for aircraft
capable of carrying ten or more individuals or 6,000 pounds or more of cargo or
that otherwise is certified or registered to the extent required to fall within
the purview of 11 U.S.C. Section 1110 or any analogous successor provision of
the Bankruptcy Code.
4
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"Certificateholder" means any holder of one or more Certificates.
-----------------
"Citizen of the United States" has the meaning given such term in Section
----------------------------
40102(a)(15) of Title 49 of the United States Code.
"Class" has the meaning assigned to such term in the preliminary statements
-----
to this Agreement.
"Class A-1 Cash Collateral Account" means an Eligible Deposit Account in
---------------------------------
the name of the Subordination Agent maintained at an Eligible Institution, which
shall be the Subordination Agent if it shall so qualify, into which all amounts
drawn under the Class A-1 Liquidity Facility pursuant to Section 3.6(c), 3.6(d)
-------------- ------
or 3.6(i) shall be deposited.
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"Class A-1 Certificateholder" means, at any time, any holder of one or more
---------------------------
Class A-1 Certificates.
"Class A-1 Certificates" means the certificates issued by the Class A-1
----------------------
Trust, substantially in the form of Exhibit A to the Class A-1 Trust Agreement,
and authenticated by the Class A-1 Trustee, representing fractional undivided
interests in the Class A-1 Trust, and any certificates issued in exchange
therefor or replacement thereof pursuant to the terms of the Class A-1 Trust
Agreement.
"Class A-1 Liquidity Facility" means, initially, the Revolving Credit
----------------------------
Agreement, dated as of August 22, 2001, between the Subordination Agent, as
agent and trustee for the Class A-1 Trust, and the initial Class A-1 Liquidity
Provider relating to the Class A-1 Certificates, and, from and after the
replacement of such Revolving Credit Agreement pursuant hereto, the Replacement
Liquidity Facility therefor, if any, in each case as amended, supplemented or
otherwise modified from time to time in accordance with its terms.
"Class A-1 Liquidity Provider" means Westdeutsche Landesbank Girozentrale,
----------------------------
acting through its New York branch, or any Replacement Liquidity Provider or
Replacement Liquidity Providers that have issued a Replacement Liquidity
Facility to replace the Class A-1 Liquidity Facility pursuant to Section 3.6(c)
--------------
or 3.6(e).
------
"Class A-1 Trust" means United Airlines 2001-1A-1 Pass Through Trust
---------------
created and administered pursuant to the Class A-1 Trust Agreement.
"Class A-1 Trust Agreement" means the Class A-1 Trust Supplement, dated as
-------------------------
of August 22, 2001, between United and State Street, together with the Basic
Pass Through Trust Agreement, as each may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Class A-1 Trust Supplement" shall mean a Trust Supplement that (i) creates
--------------------------
a separate Trust for the benefit of the Certificateholders of the Class A-1
Certificates, (ii) authorizes the issuance of the Class A-1 Certificates and
(iii) establishes the terms of the Class A-1 Certificates.
5
[2001-1 Intercreditor Agreement]
"Class A-1 Trustee" means State Street Bank and Trust Company of
-----------------
Connecticut, National Association, not in its individual capacity but solely as
trustee under the Class A-1 Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"Class A-2 Cash Collateral Account" means an Eligible Deposit Account in
---------------------------------
the name of the Subordination Agent maintained at an Eligible Institution, which
shall be the Subordination Agent if it shall so qualify, into which all amounts
drawn under the Class A-2 Liquidity Facility pursuant to Section 3.6(c), 3.6(d)
-------------- ------
or 3.6(i) shall be deposited.
------
"Class A-2 Certificateholder" means, at any time, any holder of one or more
---------------------------
Class A-2 Certificates.
"Class A-2 Certificates" means the certificates issued by the Class A-2
----------------------
Trust, substantially in the form of Exhibit A to the Class A-2 Trust Agreement,
and authenticated by the Class A-2 Trustee, representing fractional undivided
interests in the Class A-2 Trust, and any certificates issued in exchange
therefor or replacement thereof pursuant to the terms of the Class A-2 Trust
Agreement.
"Class A-2 Liquidity Facility" means, initially, the Revolving Credit
----------------------------
Agreement, dated as of August 22, 2001, between the Subordination Agent, as
agent and trustee for the Class A-2 Trust, and the initial Class A-2 Liquidity
Provider relating to the Class A-2 Certificates, and, from and after the
replacement of such Revolving Credit Agreement pursuant hereto, the Replacement
Liquidity Facility therefor, if any, in each case as amended, supplemented or
otherwise modified from time to time in accordance with its terms.
"Class A-2 Liquidity Provider" means Westdeutsche Landesbank Girozentrale,
----------------------------
acting through its New York branch, or any Replacement Liquidity Provider or
Replacement Liquidity Providers that have issued a Replacement Liquidity
Facility to replace the Class A-2 Liquidity Facility pursuant to Section 3.6(c)
--------------
or 3.6(e).
------
"Class A-2 Trust" means United Airlines 2001-1A-2 Pass Through Trust
---------------
created and administered pursuant to the Class A-2 Trust Agreement.
"Class A-2 Trust Agreement" means the Class A-2 Trust Supplement, dated as
-------------------------
of August 22, 2001, between United and State Street, together with the Basic
Pass Through Trust Agreement, as each may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Class A-2 Trust Supplement" shall mean a Trust Supplement that (i) creates
--------------------------
a separate Trust for the benefit of the Certificateholders of the Class A-2
Certificates, (ii) authorizes the issuance of Class A-2 Certificates and (iii)
establishes the terms of the Class A-2 Certificates.
"Class A-2 Trustee" means State Street Bank and Trust Company of
-----------------
Connecticut, National Association, not in its individual capacity but solely as
trustee under the Class A-2 Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"Class A-3 Cash Collateral Account" means an Eligible Deposit Account in
---------------------------------
the name of the Subordination Agent maintained at an Eligible Institution, which
shall be the
6
[2001-1 Intercreditor Agreement]
Subordination Agent if it shall so qualify, into which all amounts drawn under
the Class A-3 Liquidity Facility pursuant to Section 3.6(c), 3.6(d) or 3.6(i)
-------------- ------ ------
shall be deposited.
"Class A-3 Certificateholder" means, at any time, any holder of one or more
---------------------------
Class A-3 Certificates.
"Class A-3 Certificates" means the certificates issued by the Class A-3
----------------------
Trust, substantially in the form of Exhibit A to the Class A-3 Trust Agreement,
and authenticated by the Class A-3 Trustee, representing fractional undivided
interests in the Class A-3 Trust, and any certificates issued in exchange
therefor or replacement thereof pursuant to the terms of the Class A-3 Trust
Agreement.
"Class A-3 Liquidity Facility" means, initially, the Revolving Credit
----------------------------
Agreement, dated as of August 22, 2001, between the Subordination Agent, as
agent and trustee for the Class A-3 Trust, and the initial Class A-3 Liquidity
Provider relating to the Class A-3 Certificates, and, from and after the
replacement of such Revolving Credit Agreement pursuant hereto, the Replacement
Liquidity Facility therefor, if any, in each case as amended, supplemented or
otherwise modified from time to time in accordance with its terms.
"Class A-3 Liquidity Provider" means Westdeutsche Landesbank Girozentrale,
----------------------------
acting through its New York branch, or any Replacement Liquidity Provider or
Replacement Liquidity Providers that have issued a Replacement Liquidity
Facility to replace the Class A-3 Liquidity Facility pursuant to Section 3.6(c)
--------------
or 3.6(e).
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"Class A-3 Trust" means United Airlines 2001-1A-3 Pass Through Trust
---------------
created and administered pursuant to the Class A-3 Trust Agreement.
"Class A-3 Trust Agreement" means the Class A-3 Trust Supplement, dated as
-------------------------
of August 22, 2001, between United and State Street, together with the Basic
Pass Through Trust Agreement, as each may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Class A-3 Trust Supplement" shall mean a Trust Supplement that (i) creates
--------------------------
a separate Trust for the benefit of the Certificateholders of the Class A-3
Certificates, (ii) authorizes the issuance of Class A-3 Certificates and (iii)
establishes the terms of the Class A-3 Certificates.
"Class A-3 Trustee" means State Street Bank and Trust Company of
-----------------
Connecticut, National Association, not in its individual capacity but solely as
trustee under the Class A-3 Trust Agreement, together with any successor trustee
appointed pursuant thereto.
"Class B Cash Collateral Account" means an Eligible Deposit Account in the
-------------------------------
name of the Subordination Agent maintained at an Eligible Institution, which
shall be the Subordination Agent if it shall so qualify, into which all amounts
drawn under the Class B Liquidity Facility pursuant to Section 3.6(c), 3.6(d) or
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3.6(i) shall be deposited.
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"Class B Certificateholder" means, at any time, any holder of one or more
-------------------------
Class B Certificates.
7
[2001-1 Intercreditor Agreement]
"Class B Certificates" means the certificates issued by the Class B Trust,
--------------------
substantially in the form of Exhibit A to the Class B Trust Agreement, and
authenticated by the Class B Trustee, representing fractional undivided
interests in the Class B Trust, and any certificates issued in exchange therefor
or replacement thereof pursuant to the terms of the Class B Trust Agreement.
"Class B Liquidity Facility" means, initially, the Revolving Credit
--------------------------
Agreement, dated as of August 22, 2001, between the Subordination Agent, as
agent of the Trustee, and the initial Class B Liquidity Provider relating to the
Class B Certificates, and, from and after the replacement of such Revolving
Credit Agreement pursuant hereto, the Replacement Liquidity Facility therefor,
if any, in each case as amended, supplemented or otherwise modified from time to
time in accordance with its terms.
"Class B Liquidity Provider" means Westdeutsche Landesbank Girozentrale,
--------------------------
acting through its New York branch, or any Replacement Liquidity Provider or
Replacement Liquidity Providers that have issued a Replacement Liquidity
Facility to replace the Class B Liquidity Facility pursuant to Section 3.6(c) or
--------------
3.6(e).
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"Class B Trust" means United Airlines 2001-1B Pass Through Trust created
-------------
and administered pursuant to the Class B Trust Agreement.
"Class B Trust Agreement" means the Class B Trust Supplement, dated as of
-----------------------
August 22, 2001, between United and State Street, together with the Basic Pass
Through Trust Agreement, as each may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Class B Trust Supplement" shall mean a Trust Supplement that (i) creates a
------------------------
separate Trust for the benefit of the Certificateholders of the Class B
Certificates, (ii) authorizes the issuance of Class B Certificates and (iii)
establishes the terms of the Class B Certificates.
"Class B Trustee" means State Street Bank and Trust Company of Connecticut,
---------------
National Association, not in its individual capacity but solely as trustee under
the Class B Trust Agreement, together with any successor trustee appointed
thereto.
"Class C Cash Collateral Account" means an Eligible Deposit Account in the
-------------------------------
name of the Subordination Agent maintained at an Eligible Institution, which
shall be the Subordination Agent if it shall so qualify, into which all amounts
drawn under the Class C Liquidity Facility pursuant to Section 3.6(c), 3.6(d) or
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3.6(i) shall be deposited.
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"Class C Certificateholder" means, at any time, any holder of one or more
-------------------------
Class C Certificates.
"Class C Certificates" means the certificates issued by the Class C Trust,
--------------------
substantially in the form of Exhibit A to the Class C Trust Agreement, and
authenticated by the Class C Trustee, representing fractional undivided
interests in such Class C Trust, and any certificates issued in exchange
therefor or in replacement thereof pursuant to the terms of such Class C Trust
Agreement.
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"Class C Liquidity Facility" means, initially, the Revolving Credit
--------------------------
Agreement, dated as of August 22, 2001, between the Subordination Agent, as
agent of the Trustee, and the initial Class C Liquidity Provider relating to the
Class C Certificates, and, from and after the replacement of such Revolving
Credit Agreement pursuant hereto, the Replacement Liquidity Facility therefor,
if any, in each case as amended, supplemented or otherwise modified from time to
time in accordance with its terms.
"Class C Liquidity Provider" means Westdeutsche Landesbank Girozentrale,
--------------------------
acting through its New York branch, or any Replacement Liquidity Provider or
Replacement Liquidity Providers that have issued a Replacement Liquidity
Facility to replace the Class C Liquidity Facility pursuant to Section 3.6(c) or
--------------
3.6(e).
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"Class C Trust" means United Airlines 2001-1C Pass Through Trust created
-------------
and administered pursuant to the Class C Trust Agreement.
"Class C Trust Agreement" means the Class C Trust Supplement, dated as of
-----------------------
August 22, 2001, between United and State Street, together with the Basic Pass
Through Trust Agreement, as each may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Class C Trust Supplement" shall mean a Trust Supplement that (i) creates a
------------------------
separate Trust for the benefit of the Certificateholders of the Class C
Certificates, (ii) authorizes the issuance of Class C Certificates and (iii)
establishes the terms of the Class C Certificates.
"Class C Trustee" means State Street Bank and Trust Company of Connecticut,
---------------
National Association, not in its individual capacity but solely as trustee under
the Class C Trust Agreement, together with any successor trustee appointed
thereto.
"Class D Certificateholder" means, at any time, any holder of one or more
-------------------------
Class D Certificates.
"Class D Certificates" means the certificates issued by the Class D Trust,
---------------------
substantially in the form of Exhibit A to the Class D Trust Agreement, and
authenticated by the Class D Trustee, representing fractional undivided
interests in the Class D Trust, and any certificates issued in exchange therefor
or replacement thereof pursuant to the terms of the Class D Trust Agreement.
"Class D Trust" means United Airlines 2001-1D Pass Through Trust created
-------------
and administered pursuant to the Class D Trust Agreement.
"Class D Trust Agreement" means the Class D Trust Supplement, dated as of
-----------------------
August 22, 2001, between United and State Street, together with the Basic Pass
Through Trust Agreement, as each may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Class D Trust Supplement" shall mean a Trust Supplement that (i) creates a
------------------------
separate Trust for the benefit of the Certificateholders of the Class D
Certificates, (ii) authorizes the issuance of the Class D Certificates and (iii)
establishes the terms of the Class D Certificates.
9
[2001-1 Intercreditor Agreement]
"Class D Trustee" means State Street Bank and Trust Company of Connecticut,
---------------
National Association, not in its individual capacity but solely as trustee under
the Class D Trust Agreement, together with any successor trustee appointed
pursuant thereto.
"Closing Date" means August 22, 2001.
------------
"Code" means the Internal Revenue Code of 1986, as amended from time to
----
time, and Treasury Regulations promulgated thereunder.
"Collection Account" means the Eligible Deposit Account established by the
------------------
Subordination Agent pursuant to Section 2.2(a) into and from which the
--------------
Subordination Agent shall make deposits and withdrawals in accordance with this
Agreement.
"Consent Period" has the meaning specified in Section 3.6(d).
--------------
"Controlling Party" means the Person entitled to act as such pursuant to
-----------------
the terms of Section 2.6.
-----------
"Corporate Trust Office" means, with respect to any Trustee, the
----------------------
Subordination Agent or any Indenture Trustee, the office of such Person in the
city at which, at any particular time, its corporate trust business shall be
principally administered.
"Current Distribution Date" means a Distribution Date specified as a
-------------------------
reference date for calculating the Expected Distributions or the Adjusted
Expected Distributions with respect to the Certificates of any Trust as of such
Distribution Date.
"Current Pool Balance" means the amount described in clause (B)(i) of the
-------------------- -------------
definition of "Adjusted Expected Distributions."
"Designated Representatives" means the Subordination Agent Representatives,
--------------------------
the Trustee Representatives and the LP Representatives identified under Section
-------
2.5.
---
"Distribution Date" means a Regular Distribution Date or a Special
-----------------
Distribution Date.
"Dollars" means United States dollars.
-------
"Downgrade Drawing" has the meaning assigned to such term in Section
----------------- -------
3.6(c).
"Downgraded Facility" has the meaning assigned to such term in Section
------------------- -------
3.6(c).
------
"Drawing" means an Interest Drawing, a Final Drawing, a Non-Extension
-------
Drawing or a Downgrade Drawing, as the case may be.
"Eligible Deposit Account" means either (a) a segregated account with an
------------------------
Eligible Institution or (b) a segregated trust account with the corporate trust
department of a depository institution organized under the laws of the United
States of America or any one of the states thereof or the District of Columbia
(or any U.S. branch of a foreign bank), having corporate trust powers and acting
as trustee for funds deposited in such account, so long as any of the securities
10
[2001-1 Intercreditor Agreement]
of such depository institution has a long-term unsecured debt rating from each
Rating Agency of at least "A-3" or its equivalent. An Eligible Deposit Account
may be maintained with a Liquidity Provider so long as such Liquidity Provider
is an Eligible Institution; provided, however, that such Liquidity Provider
-------- -------
shall have waived all rights of set-off and counterclaim with respect to such
account; and provided, further, that each institution at which any Eligible
-------- -------
Deposit Account is maintained shall agree, for all purposes of the applicable
UCC, including Article 8 thereof, that (a) such account shall be a "securities
account" (as defined in Section 8-501 of the Uniform Commercial Code in effect
in the State of New York), (b) all property credited to such account shall be
treated as a "financial asset" (as defined in Section 8-102(a)(9) of the Uniform
Commercial Code in effect in the State of New York), (c) the Subordination Agent
shall be the "entitlement holder" (as defined in Section 8-102(a)(7) of the
Uniform Commercial Code in effect in the State of New York) in respect of such
account, (d) such institution shall comply with all entitlement orders issued by
the Subordination Agent to the exclusion of any other Person and (e) the
"securities intermediary jurisdiction" (under Section 8-110(e) of the Uniform
Commercial Code in effect in the State of New York) shall be the State of
Illinois.
"Eligible Institution" means (a) the corporate trust department of the
--------------------
Subordination Agent or any Trustee, as applicable, so long as it has a long term
unsecured debt rating from each Rating Agency of at least "A-3" or its
equivalent, or (b) a depository institution organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia (or any U.S. branch of a foreign bank), which has a long-term unsecured
debt rating from each Rating Agency of at least "A-3" or its equivalent.
"Eligible Investments" means each of (i) obligations of, or guaranteed by,
--------------------
the United States Government, (ii) open market commercial paper of any
corporation incorporated under the laws of the United States of America or any
state thereof rated at least "P-1" or its equivalent by Moody's and at least "A-
1" or its equivalent by Standard & Poor's, (iii) certificates of deposit, time
deposits or other direct obligations of, or obligations guaranteed by,
commercial banks organized under the laws of the United States or of any
political subdivision thereof having a combined capital and surplus in excess of
$500,000,000 which banks or their holding companies have a rating of "A" or its
equivalent by Moody's or Standard & Poor's; provided, however, that the
-------- -------
aggregate amount at any one time so invested in certificates of deposit issued
by any one bank shall not exceed 5% of such bank's capital and surplus, (iv)
U.S. dollar denominated offshore certificates of deposit issued by, or offshore
time deposits with, any commercial bank described in clause (iii) or any
------------
subsidiary thereof and (v) repurchase agreements with any financial institution
having combined capital and surplus of at least $500,000,000 with any of the
obligations described in clauses (i) through (iv) as collateral; provided that
----------- ---- --------
all Eligible Investments held pursuant to this Agreement must be held in an
Eligible Deposit Account.
"Expected Distributions" means, with respect to the Certificates of any
----------------------
Trust on any Current Distribution Date, the sum of (x) accrued and unpaid
interest on such Certificates and (y) the difference between (A) the Pool
Balance of such Certificates as of the preceding Distribution Date (or, if the
Current Distribution Date is the first Distribution Date, the original aggregate
face amount of the Certificates of such Trust) and (B) the Pool Balance of such
Certificates as of the Current Distribution Date, calculated on the basis that
(i) the principal of the Notes held in such Trust has been paid when due
(whether at stated maturity, upon
11
[2001-1 Intercreditor Agreement]
redemption, prepayment, purchase or Acceleration or otherwise) and such payments
have been distributed to the holders of such Certificates and (ii) the principal
of any Notes formerly held in such Trust that have been sold pursuant to the
terms hereof has been paid in full and such payments have been distributed to
the holders of such Certificates. For purposes of calculating Expected
Distributions, any Additional Payment paid on the Notes held in any Trust which
has not been distributed to the Certificateholders of such Trust (other than
such Additional Payment or a portion thereof applied to the payment of interest
on the Certificates of such Trust or the reduction of the Pool Balance of such
Trust) shall be added to the amount of such Expected Distributions.
"Expiry Date" with respect to any Liquidity Facility, shall have the
-----------
meaning set forth in such Liquidity Facility.
"Fee Letter" means the Fee Letter, dated as of August 22, 2001, between
----------
United, Westdeutsche Landesbank Girozentrale and the Subordination Agent with
respect to the initial Liquidity Facilities, and any fee letter entered into
between the Subordination Agent and any Replacement Liquidity Provider.
"Final Distributions" means, with respect to the Certificates of any Trust
-------------------
on any Distribution Date, the sum of (x) the aggregate amount of all accrued and
unpaid interest on such Certificates and (y) the Pool Balance of such
Certificates as of the preceding Distribution Date. For purposes of calculating
Final Distributions, any Additional Payment paid on the Notes held in any Trust
which has not been distributed to the Certificateholders of such Trust (other
than such Additional Payment or a portion thereof applied to the payment of
interest on the Certificates of such Trust or the reduction of the Pool Balance
of such Trust) shall be added to the amount of such Final Distributions.
"Final Drawing" has the meaning assigned to such term in Section 3.6(i).
------------- --------------
"Final Maturity Date" for the Class A-1 Certificates means September 1,
-------------------
2014, for the Class A-2 Certificates means March 1, 2010, for the Class A-3
Certificates means March 1, 2015, for the Class B Certificates means March 1,
2013, for the Class C Certificates means March 1, 2010, and for the Class D
Certificates means September 1, 2006.
"Indenture" means, with respect to the Notes, each of the one or more
---------
separate trust indentures and mortgages described on Schedule I attached to this
Agreement, as each such indenture may be amended, supplemented or modified in
accordance with its respective terms.
"Indenture Default" means, with respect to any Indenture, any Indenture
-----------------
Event of Default (as such term is defined in such Indenture) thereunder.
"Indenture Estate" means, with respect to any Indenture, the "Indenture
----------------
Estate" referred to therein.
"Indenture Trustee" means, with respect to any Indenture, the indenture
-----------------
trustee thereunder.
"Interest Drawing" has the meaning assigned to such term in Section 3.6(a).
---------------- --------------
12
[2001-1 Intercreditor Agreement]
"Investment Earnings" means investment earnings on funds on deposit in the
-------------------
Trust Accounts net of losses and investment expenses of the Subordination Agent
in making such investments.
"Lien" means any mortgage, pledge, lien, charge, claim, disposition of
----
title, encumbrance, lease, sublease, or security interest of any kind, including
any arising under any conditional sales or other title retention agreement.
"Liquidity Event of Default," with respect to any Liquidity Facility, has
--------------------------
the meaning assigned to such term in such Liquidity Facility.
"Liquidity Expenses" means, with respect to the Liquidity Facilities, all
------------------
Liquidity Obligations other than (i) the principal amount of any Drawings under
the Liquidity Facilities and (ii) any interest accrued on such Liquidity
Obligations.
"Liquidity Facility" means, at any time, the Class A-1 Liquidity Facility,
------------------
the Class A-2 Liquidity Facility, the Class A-3 Liquidity Facility, the Class B
Liquidity Facility or the Class C Liquidity Facility, as applicable.
"Liquidity Obligations" means, with respect to the Liquidity Facilities,
---------------------
all principal, interest, fees and other amounts owing to the Liquidity Providers
under the Liquidity Facilities, the Note Purchase Agreement, the Participation
Agreements and the Fee Letter.
"Liquidity Provider" means the Class A-1 Liquidity Provider, the Class A-2
------------------
Liquidity Provider, the Class A-3 Liquidity Provider, the Class B Liquidity
Provider and the Class C Liquidity Provider, as applicable.
"LP Incumbency Certificate" has the meaning assigned to such term in
-------------------------
Section 2.5(c).
--------------
"LP Representatives" has the meaning assigned to such term in Section
------------------ -------
2.5(c).
------
"LTV Appraisals" has the meaning assigned to such term in Section 4.1(a).
-------------- --------------
"LTV Collateral Amount" of any Aircraft for any Class of Certificates
---------------------
means, as of any Distribution Date, the lesser of (i) the LTV Ratio for such
Class of Certificates multiplied by the Appraised Current Market Value of such
Aircraft (or with respect to any such Aircraft that has suffered an Event of
Loss under and as defined in the relevant Indenture, the amount of the insurance
proceeds paid to the related Indenture Trustee in respect thereof to the extent
then held by such Indenture Trustee (and/or on deposit in the Special Payments
Account) or payable to such Indenture Trustee in respect thereof) and (ii) the
outstanding principal amount of the Notes secured by such Aircraft after giving
effect to any principal payments of such Notes on or before such Distribution
Date.
"LTV Ratio" means for the Class A-1 Certificates 44.0%, the Class A-2
---------
Certificates 44.0%, the Class A-3 Certificates 44.0%, the Class B Certificates
59.0%, the Class C Certificates 67.0% and for the Class D Certificates 73.0%.
"Make-Whole Amount" shall have the meaning set forth in the Indentures.
-----------------
13
[2001-1 Intercreditor Agreement]
"Minimum Sale Price" means, with respect to any Aircraft or the Notes
------------------
issued in respect of such Aircraft, at any time, the lesser of (a) 75% of the
Appraised Current Market Value of such Aircraft and (b) the aggregate
outstanding principal amount of such Notes, plus accrued and unpaid interest
thereon.
"Moody's" means Xxxxx'x Investors Service, Inc.
-------
"Non-Controlling Party" means, at any time, any Trustee or Liquidity
---------------------
Provider that is not the Controlling Party at such time.
"Non-Extended Facility" has the meaning assigned to such term in Section
--------------------- -------
3.6(d).
------
"Non-Extension Drawing" has the meaning assigned to such term in Section
--------------------- -------
3.6(d).
------
"Non-Performing Equipment Note" means a Note issued pursuant to an
-----------------------------
Indenture that is not a Performing Equipment Note.
"Note Purchase Agreement" means the Note Purchase Agreement, dated as of
-----------------------
August 22, 2001, between the Company, the Subordination Agent, the Indenture
Trustee under the Indentures, and the Trustee, relating to the Notes in respect
of the Aircraft.
"Notes" means, at any time, the Series A-1 Notes, the Series A-2 Notes, the
-----
Series A-3 Notes, the Series B Notes, the Series C Notes and the Series D Notes,
collectively, and in each case, any Notes issued in exchange therefor or
replacement thereof pursuant to the terms of the Indentures.
"Officer's Certificate" of any Person means a certification signed by a
---------------------
Responsible Officer of such Person.
"Operative Agreements" means this Agreement, the Liquidity Facilities, the
--------------------
Fee Letter, the Indentures, the Trust Agreements, the Underwriting Agreement,
the Note Purchase Agreement, the Participation Agreements, the Notes and the
Certificates, together with all exhibits and schedules included with any of the
foregoing.
"Outstanding" means, when used with respect to each Class of Certificates,
-----------
as of the date of determination, all Certificates of such Class theretofore
authenticated and delivered under the related Trust Agreements, except:
(i) Certificates of such Class theretofore canceled by the Registrar
(as defined in such Trust Agreement) or delivered to the Trustee thereunder
or such Registrar for cancellation;
(ii) Certificates of such Class for which money in the full amount
required to make the final distribution with respect to such Certificates
pursuant to Section 11.01 of such Trust Agreement has been theretofore
deposited with the related Trustee in trust for the holders of such
Certificates as provided in Section 4.01 of such Trust Agreement pending
distribution of such money to such Certificateholders pursuant to such
final distribution payment; and
14
[2001-1 Intercreditor Agreement]
(iii) Certificates of such Class in exchange for or in lieu of which
other Certificates of like Class have been authenticated and delivered
pursuant to such Trust Agreement;
provided, however, that in determining whether the holders of the requisite
-------- -------
Outstanding amount of such Certificates have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, any Certificates
owned by United or any of its Affiliates shall be disregarded and deemed not to
be Outstanding, except that, in determining whether such Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Certificates that such Trustee knows to be so
owned shall be so disregarded. Notwithstanding the foregoing, (x) if United or
any of its Affiliates shall own 100% of the Certificates, such Certificates
shall not be so disregarded and (y) Certificates so owned by United or any of
its Affiliates that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Certificates and that the pledgee
is not United or any of its Affiliates.
"Overdue Scheduled Payment" means any Scheduled Payment that is not in fact
-------------------------
received by the Subordination Agent within five days after the Scheduled Payment
Date relating thereto.
"Participation Agreement" means, with respect to each Indenture, the
-----------------------
"Participation Agreement" referred to therein.
"Performing Equipment Note" means a Note issued pursuant to an Indenture
-------------------------
with respect to which no payment default has occurred and is continuing (without
giving effect to any Acceleration); provided, however, that in the event of a
-------- -------
bankruptcy proceeding under Title 11 of the United States Code (the "Bankruptcy
Code") under which United is a debtor, any payment default existing during the
60-day period under Section 1110(a)(2)(A) of the Bankruptcy Code (or such longer
period as may apply under Section 1110(b) of the Bankruptcy Code or as may apply
for the cure of such payment default under Section 1110(a)(2)(B) of the
Bankruptcy Code) shall not be taken into consideration until the expiration of
the applicable period.
"Performing Note Deficiency" means any time that less than 65% of the then
--------------------------
aggregate outstanding principal amount of all Notes are Performing Equipment
Notes.
"Person" means any individual, corporation, partnership, joint venture,
------
association, joint-stock company, limited liability company, trust, trustee,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pool Balance" means, with respect to the Certificates of a Class, as of
------------
any date, (i) the original aggregate face amount of the Certificates of such
Class less (ii) the aggregate amount of all payments made in respect of the
----
Certificates of such Class other than payments made in respect of interest or
Additional Payment thereon or reimbursement of any costs and expenses in
connection therewith. The Pool Balance for each Class of Certificates as of any
Distribution Date shall be computed after giving effect to the payment of
principal, if any, on the Notes held in the related Trust and the distribution
thereof to be made on such date.
[2001-1 Intercreditor Agreement]
"Proceeding" means any suit in equity, action at law or other judicial or
----------
administrative proceeding.
"PTC Event of Default" means, with respect to the Trust Agreement of any
--------------------
Class, the failure to pay within 10 Business Days of the due date thereof: (i)
the outstanding Pool Balance of the applicable Class of Certificates on the
Final Maturity Date for such Class or (ii) interest due on such Certificates on
any Distribution Date (unless, in the case of the Class A-1 Certificates, Class
A-2 Certificates, Class A-3 Certificates, Class B Certificates or Class C
Certificates, the Subordination Agent shall have made an Interest Drawing or a
withdrawal from a Cash Collateral Account with respect thereto in an amount
sufficient to pay such interest and shall have distributed such amount to the
Trustee entitled thereto).
"Rating Agencies" means, collectively, at any time, each nationally
---------------
recognized rating agency that shall have been requested to rate the Class A-1
Certificates, the Class A-2 Certificates, the Class A-3 Certificates, the Class
B Certificates, the Class C Certificates and the Class D Certificates and that
shall then be rating such Certificates. The initial Rating Agencies shall be
Moody's and Standard & Poor's.
"Ratings Confirmation" means, with respect to any action proposed to be
--------------------
taken, a written confirmation from each of the Rating Agencies that such action
would not result in (i) a reduction of the rating for the Class A-1
Certificates, the Class A-2 Certificates, the Class A-3 Certificates, the Class
B Certificates, the Class C Certificates or the Class D Certificates below the
then current rating for such Class of Certificates or (ii) a withdrawal or
suspension of the rating of the Class A-1 Certificates, the Class A-2
Certificates, the Class A-3 Certificates, the Class B Certificates, the Class C
Certificates or the Class D Certificates.
"Regular Distribution Dates" means each March 1 and September 1, commencing
--------------------------
on March 1, 2002; provided, however, that, if any such day shall not be a
-------- -------
Business Day, the related distribution for each Class of Certificates shall be
made on the next Business Day without additional interest accruing at the rate
applicable to such Class of Certificates.
"Replacement Liquidity Facility" means, for any Liquidity Facility, an
------------------------------
irrevocable revolving credit agreement issued by a one or more Replacement
Liquidity Providers for the same term as the Liquidity Facility being replaced
in substantially the form of the replaced Liquidity Facility, including
reinstatement provisions, or in such other form (which may include a letter of
credit, surety bond, financial insurance policy or guaranty) as shall permit the
Rating Agencies to confirm in writing their respective ratings then in effect
for the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3
Certificates, the Class B Certificates and the Class C Certificates (before the
downgrading of such ratings, if any, as a result of the downgrading of the
Liquidity Provider), in a face amount (or in an aggregate face amount) equal to
the Required Amount for such Liquidity Facility and issued by a Replacement
Liquidity Provider. Without limitation of the form that a Replacement Liquidity
Facility otherwise may have pursuant to the preceding sentence, a Replacement
Liquidity Facility for any Class of Certificates may have a stated expiration
date earlier than 15 days after the Final Maturity Date of such Class of
Certificates so long as such Replacement Liquidity Facility provides for a Non-
Extension Drawing as contemplated by Section 3.6(d) hereof.
--------------
16
[2001-1 Intercreditor Agreement]
"Replacement Liquidity Provider" means a Person having (i) short-term
------------------------------
unsecured debt ratings issued by each Rating Agency that are equal to or higher
than the Threshold Rating specified in clause (i) of the definition of Threshold
Rating or (ii) if such Person does not have a short-term unsecured debt rating
from each Rating Agency, long-term unsecured debt ratings issued by each Rating
Agency that are equal to or higher than the Threshold Rating specified in clause
(ii) of the definition of Threshold Rating.
"Required Amount" means, with respect to each Liquidity Facility, or the
---------------
Cash Collateral Account, for any Class, for any day, the sum of the aggregate
amount of interest, calculated at the rate per annum equal to the Stated
Interest Rate for the related Class of Certificates, that would be payable on
such Class of Certificates on each of the three successive Regular Distribution
Dates following such day or, if such day is a Regular Distribution Date, on such
day and the succeeding two Regular Distribution Dates, in each case calculated
on the basis of the Pool Balance of such Class of Certificates on such date and
without regard to expected future payments of principal on such Class of
Certificates.
"Responsible Officer" means, (i) in the case of any Liquidity Provider that
-------------------
is a United States corporation, the Chairman of the Board of Directors, the
President, the Treasurer, the Secretary, or any Vice President thereof, and in
the case of any other Liquidity Provider, an officer or other duly authorized
person responsible for the transactions contemplated by the Operative
Agreements, (ii) in the case of each Trustee and the Subordination Agent, any
officer in the Corporate Trust Department thereof or any other officer
customarily performing functions similar to those performed by the persons who
at the time shall be such officers or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with a particular subject
and (iii) in any other case, an individual generally authorized to execute and
deliver contracts on behalf of such entity.
"Scheduled Payment" means, with respect to any Note, (i) any payment of
-----------------
principal and interest on such Note (other than an Overdue Scheduled Payment)
due from the obligor thereon or (ii) in the case of the Class A-1 Certificates,
the Class A-2 Certificates, the Class A-3 Certificates, the Class B Certificates
or the Class C Certificates, any payment of interest on the corresponding Class
of Certificates with funds drawn under any Liquidity Facility or withdrawn from
a Cash Collateral Account, which payment represents the installment of principal
at the stated maturity of such installment of principal on such Note, the
payment of regularly scheduled interest accrued on the unpaid principal amount
of such Note, or both; provided, however, that any payment of principal of,
-------- -------
Additional Payment, if any, or interest resulting from the redemption or
purchase of any Note shall not constitute a Scheduled Payment.
"Scheduled Payment Date" means, with respect to any Scheduled Payment, the
----------------------
date on which such Scheduled Payment is scheduled to be made.
"Section 2.4(b) Fraction" has the meaning assigned to such term in Section
----------------------- -------
2.4(b).
------
"Series A-1 Notes" means the 6.071% Series A-1 Equipment Notes issued
----------------
pursuant to certain of the Indentures by United, and authenticated by the
respective Indenture Trustee thereunder, and any such Equipment Notes issued in
exchange therefor or replacement thereof pursuant to the terms of such
Indenture.
17
[2001-1 Intercreditor Agreement]
"Series A-2 Notes" means the 6.201% Series A-2 Equipment Notes issued
----------------
pursuant to certain of the Indentures by United, and authenticated by the
respective Indenture Trustee thereunder, and any such Equipment Notes issued in
exchange therefor or replacement thereof pursuant to the terms of such
Indenture.
"Series A-3 Notes" means the 6.602% Series A-3 Equipment Notes issued
----------------
pursuant to certain of the Indentures by United, and authenticated by the
respective Indenture Trustee thereunder, and any such Equipment Notes issued in
exchange therefor or replacement thereof pursuant to the terms of such
Indenture.
"Series B Notes" means the 6.932% Series B Equipment Notes issued pursuant
--------------
to certain of the Indentures by United, and authenticated by the respective
Indenture Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Series C Notes" means the 6.831% Series C Equipment Notes issued pursuant
--------------
to certain of the Indentures by United, and authenticated by the respective
Indenture Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Series D Notes" means the 7.371% Series D Equipment Notes issued pursuant
--------------
to certain of the Indentures by United, and authenticated by the respective
Indenture Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Special Distribution Date" means, with respect to any Special Payment, the
-------------------------
date chosen by the Subordination Agent pursuant to Section 2.4(a) for the
--------------
distribution of such Special Payment in accordance with this Agreement;
provided, however, that, if any such day shall not be a Business Day, the
-------- -------
related distribution for each Class of Certificates shall be made on the next
Business Day with additional interest accruing at the rate applicable to such
Class of Certificates.
"Special Payment" means any payment (other than a Scheduled Payment) in
---------------
respect of, or any proceeds of, any Note.
"Special Payments Account" means the Eligible Deposit Account created
------------------------
pursuant to Section 2.2 as a sub-account to the Collection Account.
-----------
"Standard & Poor's" means Standard & Poor's Ratings Services, a Division of
-----------------
The XxXxxx-Xxxx Companies, Inc.
"State Street" has the meaning assigned to such term in the recital of
------------
parties to this Agreement.
"Stated Amount" with respect to any Liquidity Facility, means the Maximum
-------------
Commitment (as defined in such Liquidity Facility) of the applicable Liquidity
Provider thereunder.
18
[2001-1 Intercreditor Agreement]
"Stated Interest Rate" means (i) with respect to the Class A-1
--------------------
Certificates, 6.071% per annum, (ii) with respect to the Class A-2 Certificates,
6.201% per annum, (iii) with respect to the Class A-3 Certificates, 6.602% per
annum, (iv) with respect to the Class B Certificates, 6.932% per annum, (v) with
respect to the Class C Certificates, 6.831% per annum and (vi) with respect to
the Class D Certificates, 7.371% per annum.
"Subordination Agent" has the meaning assigned to such term in the recital
-------------------
of parties to this Agreement.
"Subordination Agent Incumbency Certificate" has the meaning assigned to
------------------------------------------
such term in Section 2.5(a).
--------------
"Subordination Agent Representatives" has the meaning assigned to such term
-----------------------------------
in Section 2.5(a).
--------------
"Tax" and "Taxes" mean any and all taxes, fees, levies, duties, tariffs,
--- -----
imposts and other charges of any kind (together with any and all interest,
penalties, loss, damage, liability, expense, additions to tax and additional
amounts or costs incurred or imposed with respect thereto) imposed or otherwise
assessed by the United States or by any state, local or foreign government (or
any subdivision or agency thereof) or other taxing authority, including, without
limitation: taxes or other charges on or with respect to income, franchises,
windfall or other profits, gross receipts, property, sales, use, capital stock,
payroll, employment, social security, workers' compensation, unemployment
compensation or net worth and similar charges; taxes or other charges in the
nature of excise, withholding, ad valorem, stamp, transfer, value added, taxes
on goods and services, gains taxes, license, registration and documentation
fees, customs duties, tariffs and similar charges.
"Termination Notice" with respect to any Liquidity Facility has the meaning
------------------
assigned to such term in such Liquidity Facility.
"Threshold Rating" means, (A) with respect to the Class A-1 Liquidity
----------------
Provider, Class A-2 Liquidity Provider, Class A-3 Liquidity Provider, or Class B
Liquidity Provider, (i) the short-term unsecured debt rating of "P-1" by Moody's
and "A-1+" by Standard & Poor's and (ii) for any Person which does not have a
short-term unsecured debt rating from either or both of the Rating Agencies, the
long-term unsecured debt rating of "Aa3" by Moody's and "AA-" by Standard &
Poor's; and (B) with respect to the Class C Liquidity Provider, (i) the short-
term unsecured debt rating of "P-1" by Moody's and "A-1" by Standard & Poor's
and (ii) for any Person who does not have a short-term unsecured debt rating
from either or both of the Rating Agencies, the long-term unsecured debt rating
of "A3" by Moody's and "A-" by Standard & Poor's.
"Treasury Regulations" means regulations, including proposed or temporary
--------------------
regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Triggering Event" means (x) the occurrence of an Indenture Default under
----------------
all of the Indentures resulting in a PTC Event of Default with respect to the
most senior Class of
19
[2001-1 Intercreditor Agreement]
Certificates then Outstanding, (y) the Acceleration of all of the outstanding
Notes or (z) the occurrence of a United Bankruptcy Event.
"Trust" means any of the Class A-1 Trust, the Class A-2 Trust, the Class A-
-----
3 Trust, the Class B Trust, the Class C Trust or the Class D Trust.
"Trust Accounts" has the meaning assigned to such term in Section 2.2(a).
-------------- --------------
"Trust Agreement" means any of the Class A-1 Trust Agreement, the Class A-2
---------------
Trust Agreement, the Class A-3 Trust Agreement, the Class B Trust Agreement, the
Class C Trust Agreement or the Class D Trust Agreement.
"Trustee" means any of the Class A-1 Trustee, the Class A-2 Trustee, the
-------
Class A-3 Trustee, the Class B Trustee, the Class C Trustee or the Class D
Trustee.
"Trustee Incumbency Certificate" has the meaning assigned to such term in
------------------------------
Section 2.5(b).
--------------
"Trustee Representatives" has the meaning assigned to such term in Section
----------------------- -------
2.5(b).
------
"Trust Supplement" means an agreement supplemental to the Basic Pass
----------------
Through Agreement pursuant to which (i) a separate Trust is created for the
benefit of the Holders of the Certificates of a class, (ii) the issuance of the
Certificates of such class representing fractional undivided interests in such
Trust is authorized and (iii) the terms of the Certificates of such class are
established.
"U.C.C." means the Uniform Commercial Code in effect in the applicable
------
jurisdiction.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
----------------------
August 10, 2001, between the Underwriters and United, relating to the purchase
of the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3
Certificates, the Class B Certificates and the Class C Certificates by the
Underwriters, as the same may be amended, supplemented or otherwise modified
from time to time in accordance with its terms.
"Underwriters" means the several underwriters listed as such in the
------------
Underwriting Agreement.
"United" means United Air Lines, Inc., a Delaware corporation, and its
------
successors and assigns.
"United Bankruptcy Event" means the occurrence and continuation of any of
-----------------------
the following:
(i) United shall consent to the appointment of or the taking of
possession by a receiver, trustee or liquidator of itself or of a
substantial part of its property, or United 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 United shall file a voluntary petition in
20
[2001-1 Intercreditor Agreement]
bankruptcy or a voluntary petition or an answer seeking reorganization,
liquidation or other relief in a case under any bankruptcy laws or other
insolvency laws (as in effect at such time) or an answer admitting the
material allegations of a petition filed against United in any such case,
or United 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 United shall seek an agreement, composition, extension or
adjustment with its creditors under such laws, or United's board of
directors shall adopt a resolution authorizing corporate action in
furtherance of any of the foregoing; or
(ii) an order, judgment or decree shall be entered by any court
of competent jurisdiction appointing, without the consent of United, a
receiver, trustee or liquidator of United or of any substantial part of its
property, or any substantial part of the property of United shall be
sequestered, or granting any other relief in respect of United as a debtor
under any bankruptcy laws or other insolvency laws (as in effect at such
time), 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; and
(iii) a petition against United 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 United, any court of competent jurisdiction
assumes jurisdiction, custody or control of United or of any substantial
part of its property and such jurisdiction, custody or control remains in
force unrelinquished, unstayed and unterminated for a period of 90 days.
"United Provisions" has the meaning assigned to such term in Section
----------------- -------
9.1(a).
"Written Notice" means, from (i) the Trustee or any Liquidity Provider, a
--------------
written instrument executed by the Designated Representative of such Person, and
(ii) the Subordination Agent, a written instrument executed by a Person
designated in the Officer's Certificate of the Subordination Agent delivered on
the Closing Date. An invoice delivered by a Liquidity Provider pursuant to
Section 3.1 in accordance with its normal invoicing procedures shall constitute
-----------
Written Notice under such Section.
21
[2001-1 Intercreditor Agreement]
ARTICLE II
TRUST ACCOUNTS; CONTROLLING PARTY
2.1 Agreement to Terms of Subordination; Payments from Monies Received
------------------------------------------------------------------
Only.
----
(a) Each Trustee hereby acknowledges and agrees to the terms of
subordination and distribution set forth in this Agreement in respect of each
Class of Certificates and agrees to enforce such provisions and cause all
payments in respect of the Notes and the Liquidity Facilities to be applied in
accordance with the terms of this Agreement. In addition, each Trustee hereby
agrees to cause the Notes purchased by the related Trust to be registered in the
name of the Subordination Agent or its nominee, as agent and trustee for such
Trustee, to be held in trust by the Subordination Agent solely for the purpose
of facilitating the enforcement of the subordination and other provisions of
this Agreement.
(b) Except as otherwise expressly provided in the next sentence of
this Section 2.1, all payments to be made by the Subordination Agent hereunder
shall be made only from amounts received by it that constitute Scheduled
Payments, Special Payments, payments under Section 5(b) of the Participation
Agreement, payments under Section 4(j) of the Note Purchase Agreement, payments
under Section 2.12 of the Indentures or payments under any Liquidity Facility,
and only to the extent that the Subordination Agent shall have received
sufficient income or proceeds therefrom to enable it to make such payments in
accordance with the terms hereof. Each of the Trustees and the Subordination
Agent hereby agrees and, as provided in each Trust Agreement, each
Certificateholder, by its acceptance of a Certificate, and each Liquidity
Provider, by entering into the Liquidity Facility to which it is a party, has
agreed to look solely to such amounts to the extent available for distribution
to it as provided in this Agreement and that none of the Trustees, the Indenture
Trustees, nor the Subordination Agent is personally liable to any of them for
any amounts payable or any liability under this Agreement, any Trust Agreement,
any Liquidity Facility or such Certificate, except (in the case of the
Subordination Agent) as expressly provided herein or (in the case of the
Trustee) as expressly provided in each Trust Agreement or (in the case of the
Indenture Trustees) as expressly provided in any Operative Agreement.
2.2 Trust Accounts. (a) Upon the execution of this Agreement, the
--------------
Subordination Agent shall establish and maintain in its name (i) the Collection
Account as an Eligible Deposit Account, bearing a designation clearly indicating
that the funds deposited therein are held in trust for the benefit of the
Trustees, the Certificateholders and the Liquidity Providers and (ii) as a sub-
account in the Collection Account, the Special Payments Account as an Eligible
Deposit Account, bearing a designation clearly indicating that the funds
deposited therein are held in trust for the benefit of the Trustees, the
Certificateholders and the Liquidity Providers. The Subordination Agent shall
establish and maintain the Cash Collateral Accounts pursuant to and under the
circumstances set forth in Section 3.6(f). Upon such establishment and
--------------
maintenance under Section 3.6(f), the Cash Collateral Accounts shall, together
--------------
with the Collection Account, constitute the "Trust Accounts" hereunder. Each
such Trust Account shall meet the requirements of an "Eligible Deposit Account."
22
[2001-1 Intercreditor Agreement]
(b) Funds on deposit in the Trust Accounts shall be invested and
reinvested by the Subordination Agent in Eligible Investments selected by the
Subordination Agent if such investments are reasonably available and have
maturities no later than the Business Day preceding the Regular Distribution
Date or the date of the related distribution pursuant to Section 2.4, as the
-----------
case may be, next following the date of such investment; provided, however, that
-------- -------
upon the occurrence and during the continuation of a Triggering Event, the
Subordination Agent shall invest and reinvest such amounts in accordance with
the written instructions of the Controlling Party; and provided, further, that
-------- -------
following the making of a Non-Extension Drawing or a Downgrade Drawing under any
Liquidity Facility, the Subordination Agent shall invest and reinvest the
amounts in the Cash Collateral Account with respect to such Liquidity Facility
at the direction of the Liquidity Provider funding such Drawing. Unless
otherwise expressly provided in this Agreement (including Section 3.6(f)), any
--------------
Investment Earnings shall be deposited in the Collection Account when received
by the Subordination Agent and shall be applied by the Subordination Agent in
the same manner as the principal amount of such investment is to be applied and
any losses shall be charged against the principal amount invested, in each case
net of the Subordination Agent's reasonable fees and expenses in making such
investments. The Subordination Agent shall not be liable for any loss resulting
from any investment, reinvestment or liquidation required to be made under this
Agreement other than by reason of its willful misconduct or gross negligence.
Eligible Investments and any other investment required to be made hereunder
shall be held to their maturities except that any such investment may be sold
(without regard to its maturity) by the Subordination Agent without instructions
whenever such sale is necessary to make a distribution required under this
Agreement. Uninvested funds held hereunder shall not earn or accrue interest.
(c) The Subordination Agent shall possess all right, title and
interest in all funds on deposit from time to time in the Trust Accounts and in
all proceeds thereof (including all income thereon, except as otherwise
expressly provided herein with respect to Investment Earnings). The Trust
Accounts shall be held in trust by the Subordination Agent under the sole
dominion and control of the Subordination Agent for the benefit of the Trustees,
the Certificateholders and the Liquidity Providers, as the case may be. The
Subordination Agent shall maintain "control" of the Trust Accounts within the
meaning of Section 8-106 of the U.C.C. If, at any time, any of the Trust
Accounts ceases to be an Eligible Deposit Account, the Subordination Agent shall
within 10 Business Days (or such longer period, not to exceed 30 calendar days,
to which each Rating Agency may consent) establish a new Collection Account,
Special Payments Account or Cash Collateral Account, as the case may be, as an
Eligible Deposit Account and shall transfer any cash and/or any investments to
such new Collection Account, Special Payments Account or Cash Collateral
Account, as the case may be. So long as State Street is an Eligible Institution,
the Trust Accounts shall be maintained with it as Eligible Deposit Accounts.
2.3 Deposits to the Collection Account and Special Payments Account. (a)
---------------------------------------------------------------
The Subordination Agent shall, upon receipt thereof, deposit in the Collection
Account all Scheduled Payments received by it .
(b) The Subordination Agent shall, on each date when one or more
Special Payments are made to the Subordination Agent as holder of the Notes,
deposit in the Special Payments Account the aggregate amount of such Special
Payments.
23
[2001-1 Intercreditor Agreement]
2.4 Distributions of Special Payments. (a) Notice of Special Payment. Upon
--------------------------------- -------------------------
receipt by the Subordination Agent, as registered holder of the Notes, of any
notice of a Special Payment (or, in the absence of any such notice, upon receipt
by the Subordination Agent of a Special Payment), the Subordination Agent shall
promptly give notice thereof to the Trustee and the Liquidity Providers. The
Subordination Agent shall promptly calculate the amount of the redemption or
purchase of the Notes or the amount of any Overdue Scheduled Payment, as the
case may be, comprising such Special Payment under the applicable Indenture or
Indentures and shall promptly send to the Trustee a Written Notice of such
amount. Such Written Notice shall also set the distribution date for such
Special Payment (a "Special Distribution Date"), which shall be the first
Business Day which follows the later to occur of (x) the 20th day after the date
of such Written Notice or (y) the date the Subordination Agent has received or
expects to receive such Special Payment.
(b) Redemptions and Purchases of All Notes. So long as no Triggering
--------------------------------------
Event shall have occurred (whether or not continuing), the Subordination Agent
shall make distributions pursuant to this Section 2.4(b) of amounts on deposit
--------------
in the Special Payments Account on account of the redemption, purchase or
refinancing (including a purchase resulting from a sale of the Notes permitted
by Article IV) of all of the Notes issued pursuant to an Indenture on the
----------
Special Distribution Date for such Special Payment in the following order of
priority:
First, such amount as shall be required to pay (A) all accrued and
-----
unpaid Liquidity Expenses then in arrears plus (B) the product of (x) the
----
aggregate amount of all accrued and unpaid Liquidity Expenses not in
arrears to such Special Payment Date multiplied by (y) a fraction, the
-------------
numerator of which is the aggregate outstanding principal amount of Notes
(other than the Series D Notes) being redeemed (either in whole or in
part), purchased or refinanced on such Special Distribution Date and the
denominator of which is the aggregate outstanding principal amount of all
such Notes (the "Section 2.4(b) Fraction"), shall be distributed to the
Liquidity Providers pro rata on the basis of the amount of Liquidity
Expenses owed to each Liquidity Provider;
Second, such amount as shall be required to pay (A) all accrued and
------
unpaid interest then in arrears on all Liquidity Obligations (including
interest accrued and unpaid on any Advance (as defined in any Liquidity
Facility)) plus (B) the product of (x) the aggregate amount of all accrued
----
and unpaid interest on all Liquidity Obligations not in arrears to such
Special Distribution Date (at the rate provided in the applicable Liquidity
Facility) multiplied by (y) the Section 2.4(b) Fraction, shall be
-------------
distributed to the Liquidity Providers pro rata on the basis of the amount
of Liquidity Obligations owed to each Liquidity Provider;
Third, such amount as shall be required (A) if any Cash Collateral
-----
Account relating to a Liquidity Facility had been previously funded as
provided in Section 3.6(f), to fund such Cash Collateral Account up to its
--------------
Required Amount shall be deposited in such Cash Collateral Account, (B) if
any Liquidity Facility shall become a Downgraded Facility or a Non-Extended
Facility at a time when unreimbursed Interest Drawings under such Liquidity
Facility have reduced the Available Amount thereunder to zero, to fund the
relevant Cash Collateral Account up to its Required Amount shall be
deposited in
24
[2001-1 Intercreditor Agreement]
such Cash Collateral Account and (C) if, with respect to any particular
Liquidity Facility, neither subclause (A) nor subclause (B) of this clause
------------ ------------ ------
third are applicable, to pay or reimburse the Liquidity Provider in respect
-----
of such Liquidity Facility, in each case in an amount equal to the amount
of any unreimbursed Interest Drawings under the Liquidity Facilities shall
be distributed to the Liquidity Providers, pro rata on the basis of the
amounts of all such deficiencies and/or unreimbursed Interest Drawings;
Fourth, if, with respect to any particular Liquidity Facility, either
------
subclause (A) or (B) of clause third above is applicable, then the
------------- - ------ -----
Liquidity Provider with respect to such Liquidity Facility shall be paid
the excess of (x) the aggregate outstanding amount of unreimbursed Advances
(whether or not then due) under such Liquidity Facility over (y) the
Required Amount for the relevant Class, pro rata on the basis of such
amounts in respect of each Liquidity Provider;
Fifth, such amount as shall be required to pay in full Expected
-----
Distributions to the holders of Class A-1 Certificates on such Special
Distribution Date shall be distributed to the Class A-1 Trustee, such
amount as shall be required to pay in full Expected Distributions to the
holders of Class A-2 Certificates on such Special Distribution Date shall
be distributed to the Class A-2 Trustee and such amount as shall be
required to pay in full Expected Distributions to the holders of Class A-3
Certificates on such Special Distribution Date shall be distributed to the
Class A-3 Trustee, pro rata on the basis of such amounts in respect of each
such Class of Certificates;
Sixth, such amount as shall be required to pay in full Expected
-----
Distributions to the holders of Class B Certificates on such Special
Distribution Date shall be distributed to the Class B Trustee;
Seventh, such amount as shall be required to pay in full Expected
-------
Distributions to the holders of Class C Certificates on such Special
Distribution Date shall be distributed to the Class C Trustee;
Eighth, such amount as shall be required to pay in full Expected
------
Distributions to the holders of Class D Certificates on such Special
Distribution Date shall be distributed to the Class D Trustee; and
Ninth, the balance, if any, of such Special Payment shall be
-----
distributed to the Collection Account.
For the purposes of this Section 2.4(b), clause (x) of the definition of
-------------- ----------
"Expected Distributions" shall be deemed to read as follows: "(x) accrued, due
and unpaid interest on such Certificates together with (without duplication)
accrued and unpaid interest on a portion of such Certificates equal to the
outstanding principal amount of the Notes held in such Trust and being redeemed,
purchased or prepaid (immediately prior to such redemption, purchase or
prepayment)".
(c) Other Special Payments. Any amounts on deposit in the Special
----------------------
Payments Account other than in respect of amounts to be distributed pursuant to
Section 2.4(b) or (e) shall be distributed on the Special Distribution Date
-------------- -
therefor in accordance with Article III.
-----------
25
[2001-1 Intercreditor Agreement]
(d) Investment of Amounts in Special Payments Account. Any amounts on
-------------------------------------------------
deposit in the Special Payments Account prior to the distribution thereof
pursuant to Section 2.4(b), (c) or (e) shall be invested in accordance with
-------------- - -
Section 2.2(b). Investment Earnings on such investments shall be distributed in
-------------
accordance with Section 2.4(b), (c) or (e), as the case may be.
-------------- --- ---
(e) Certain Payments. Except as otherwise provided in Sections
---------------- --------
2.4(b), 3.2 and 3.3, the Subordination Agent shall distribute promptly upon
------ --- ---
receipt thereof (i) any indemnity payment received by it from United in respect
of any Trustee or any Liquidity Provider (collectively, the "Payees") and (ii)
any compensation received by it from United under any Operative Agreement in
respect of any Payee, directly to the Payee entitled thereto.
2.5 Designated Representatives. (a) With the delivery of this Agreement,
--------------------------
the Subordination Agent shall furnish to each Liquidity Provider and each
Trustee, and from time to time thereafter may furnish to each Liquidity Provider
and each Trustee, at the Subordination Agent's discretion, or upon any Liquidity
Provider's or Trustee's request (which request shall not be made more than one
time in any 12-month period), a certificate (a "Subordination Agent Incumbency
Certificate") of a Responsible Officer of the Subordination Agent certifying as
to the incumbency and specimen signatures of the officers of the Subordination
Agent and the attorney-in-fact and agents of the Subordination Agent (the
"Subordination Agent Representatives") authorized to give Written Notices on
behalf of the Subordination Agent hereunder. Until each Liquidity Provider and
Trustee receives a subsequent Subordination Agent Incumbency Certificate, it
shall be entitled to rely on the last Subordination Agent Incumbency Certificate
delivered to it hereunder.
(b) With the delivery of this Agreement, each Trustee shall furnish
to the Subordination Agent, and from time to time thereafter may furnish to the
Subordination Agent, at such Trustee's discretion, or upon the Subordination
Agent's request (which request shall not be made more than one time in any 12-
month period), a certificate (a "Trustee Incumbency Certificate") of a
Responsible Officer of such Trustee certifying as to the incumbency and specimen
signatures of the officers of such Trustee and the attorney-in-fact and agents
of such Trustee (the "Trustee Representatives") authorized to give Written
Notices on behalf of the Trustee hereunder. Until the Subordination Agent
receives a subsequent Trustee Incumbency Certificate, it shall be entitled to
rely on the last Trustee Incumbency Certificate delivered to it hereunder.
(c) With the delivery of this Agreement, each Liquidity Provider
shall furnish to the Subordination Agent, and from time to time thereafter may
furnish to the Subordination Agent, at such Liquidity Provider's discretion, or
upon the Subordination Agent's request (which request shall not be made more
than one time in any 12-month period), a certificate (an "LP Incumbency
Certificate") of any Responsible Officer of such Liquidity Provider certifying
as to the incumbency and specimen signatures of any officer, attorney-in-fact,
agent or other designated representative of such Liquidity Provider (the "LP
Representatives" and, together with the Subordination Agent Representatives and
the Trustee Representatives, the "Designated Representatives") authorized to
give Written Notices on behalf of such Liquidity Provider hereunder. Until the
Subordination Agent receives a subsequent LP Incumbency Certificate, it shall be
entitled to rely on the last LP Incumbency Certificate delivered to it
hereunder.
26
[2001-1 Intercreditor Agreement]
2.6 Controlling Party. (a) The Trustees and the Liquidity Providers hereby
-----------------
agree that, with respect to any Indenture at any given time, the Indenture
Trustee thereunder shall be directed: (i) in taking, or refraining from taking,
any action under such Indenture or the Notes issued thereunder, so long as no
Indenture Default has occurred and is continuing thereunder, by the holders of
at least a majority of the outstanding principal amount of such Notes provided
that, for so long as the Subordination Agent is the registered holder of the
Notes, the Subordination Agent shall act with respect to this clause (i) in
----------
accordance with the direction of the Trustees in the case of each such Trustee,
with respect to the Notes issued under such Indenture and held as Trust Property
of such Trust constituting, in the aggregate, directions with respect to such
principal amount of Notes; and (ii) after the occurrence and during the
continuation of an Indenture Default thereunder, in taking, or refraining from
taking, any action permitted under such Indenture or with respect to such Notes,
including exercising remedies thereunder (including Accelerating the Notes
issued thereunder, or foreclosing the Lien on the Aircraft securing such Notes),
by the Controlling Party.
(b) The Person who shall be the "Controlling Party" with respect to any
Indenture shall be: (w) prior to payment of the Final Distributions to the
holders of the Class A-1 Certificates, Class A-2 Certificates and Class A-3
Certificates, the Class A-1 Trustee, the Class A-2 Trustee or the Class A-3
Trustee, whichever represents the Class with the largest (or larger, if
applicable) Pool Balance of Certificates outstanding at the time of
determination (or, if only one Class of Certificates is then outstanding, the
Trustee representing such Class); (x) upon payment of the Final Distributions to
the holders of Class A-1 Certificates, Class A-2 Certificates and Class A-3
Certificates, the Class B Trustee; (y) upon payment of the Final Distributions
to the holders of the Class A-1 Certificates , Class A-2 Certificates, Class A-3
Certificates and Class B Certificates, the Class C Trustee; and (z) upon payment
of the Final Distributions to the holders of the Class A-1 Certificates, Class
A-2 Certificates, Class A-3 Certificates, Class B Certificates and Class C
Certificates, the Class D Trustee. For purposes of giving effect to the
foregoing, the Trustees (other than as the Controlling Party) irrevocably agree
(and the Certificateholders (other than the Certificateholders represented by
the Controlling Party) shall be deemed to agree by virtue of their purchase of
Certificates) that the Subordination Agent, as record holder of the Notes, shall
exercise its voting rights in respect of the Notes as directed by the
Controlling Party and any vote so exercised shall be binding upon the Trustees
and all Certificateholders.
The Subordination Agent shall give written notice to all of the other
parties to this Agreement promptly upon a change in the identity of the
Controlling Party. Each of the parties hereto agrees that it shall not exercise
any of the rights of the Controlling Party at such time as it is not the
Controlling Party hereunder; provided, however, that nothing herein contained
-------- -------
shall prevent or prohibit any Non-Controlling Party from exercising such rights
as shall be specifically granted to such Non-Controlling Party hereunder and
under the other Operative Agreements.
(c) Notwithstanding the foregoing, at any time after 18 months
beginning on the earliest to occur of (i) the date on which the entire Available
Amount under any Liquidity Facility shall have been drawn (for any reason other
than a Downgrade Drawing or a Non-Extension Drawing) and remain unreimbursed,
(ii) the date on which the entire amount of any Downgrade Drawing or Non-
Extension Drawing shall have become and remain "Applied Downgrade Advances" or
"Applied Non-Extension Advances", as the case may be, under and as
27
[2001-1 Intercreditor Agreement]
defined in such Liquidity Facility and (iii) the date on which all Notes shall
have been Accelerated, the Liquidity Provider with the highest outstanding
amount of Liquidity Obligations owed to it shall have the right to elect, by
Written Notice to the Subordination Agent and the Trustee, that such Liquidity
Provider will become the Controlling Party hereunder with respect to any
Indenture at any time from and including the last day of such 18-month period.
(d) The exercise of remedies by the Controlling Party under this
Agreement shall be expressly limited by Section 4.1(a)(ii).
------------------
(e) The Controlling Party shall not be entitled to require or
obligate any Non-Controlling Party to provide funds necessary to exercise any
right or remedy hereunder.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED
3.1 Written Notice of Distribution. (a) No later than 3:00 P.M. (New York
------------------------------
City time) on the Business Day preceding each Distribution Date, each of the
following Persons shall deliver to the Subordination Agent a Written Notice
setting forth the following information as at the close of business on such
Business Day:
(i) With respect to the Class A-1 Certificates, the Class A-2
Certificates and the Class A-3 Certificates, if any are Outstanding, the
Class A-1 Trustee, the Class A-2 Trustee and the Class A-3 Trustee,
respectively, shall separately set forth the amounts to be paid in
accordance with clause fifth of Section 2.4(b) or 3.2, as the case may be
------ ----- -------------- ---
(without giving effect to the pro rata sharing therein);
(ii) With respect to the Class B Certificates, if any are
Outstanding, the Class B Trustee shall separately set forth the amounts to
be paid in accordance with clause sixth of Section 2.4(b) or 3.2, as the
------ ----- -------------- ---
case may be;
(iii) With respect to the Class C Certificates, if any are
Outstanding, the Class C Trustee shall separately set forth the amounts to be
paid in accordance with clause seventh of Section 2.4(b) or 3.2, as the case may
------ ------- ------------- ___
be;
(iv) With respect to the Class D Certificates, if any are
Outstanding, the Class D Trustee shall separately set forth the amounts to be
paid in accordance with clause eighth of Section 2.4(b) or 3.2, as the case may
------ ------ -------------- ---
be;
(v) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be paid in
accordance with clauses first, second, third and fourth of Section 2.4(b) or
----- ------ ----- ------ --------------
3.2, as the case may be; and
---
(vi) Each Trustee shall set forth the amounts to be paid in
accordance with clause ninth of Section 3.2.
------ ----- -----------
28
[2001-1 Intercreditor Agreement]
The notices required under this Section 3.1(a) may be in the form of a schedule
--------------
or similar document provided to the Subordination Agent by the parties
referenced therein or by any one of them, which schedule or similar document may
state that, unless there has been a prepayment, purchase or redemption of the
Certificates, such schedule or similar document is to remain in effect until any
substitute notice or amendment shall be given to the Subordination Agent by the
party providing such notice.
(b) Following the occurrence of a Triggering Event, the Subordination
Agent shall request the following information from the following Persons, and
each of the following Persons shall, upon the request of the Subordination
Agent, deliver a Written Notice to the Subordination Agent setting forth for
such Person the following information:
(i) With respect to the Class A-1 Certificates, the Class A-2
Certificates and the Class A-3 Certificates, if any are Outstanding, the
Class A-1 Trustee, the Class A-2 Trustee and the Class A-3 Trustee,
respectively, shall separately set forth the amounts to be paid in
accordance with clauses first (to reimburse payments made by the Class A-1
------- -----
Certificateholders, the Class A-2 Certificateholders and the Class A-3
Certificateholders, respectively, pursuant to subclause (iii) of clause
--------- ------
first of Section 3.3) and seventh of Section 3.3 (without giving effect to
----- ----------- ------- -----------
the pro rata sharing therein);
(ii) With respect to the Class B Certificates, if any are
Outstanding, the Class B Trustee shall separately set forth the amounts to
be paid in accordance with clauses first (to reimburse payments made by the
------- -----
Class B Certificateholders pursuant to subclause (iii) of clause first of
--------------- ------ -----
Section 3.3) and eighth of Section 3.3;
----------- ------ -----------
(iii) With respect to the Class C Certificates, if any are
Outstanding, the Class C Trustee shall separately set forth the amounts to
be paid in accordance with clauses first (to reimburse payments made by the
------- -----
Class C Certificateholders pursuant to subclause (iii) of clause first of
-------------- ------ -----
Section 3.3) and ninth of Section 3.3;
----------- -----
(iv) With respect to the Class D Certificates, if any are
Outstanding, the Class D Trustee shall separately set forth the amounts to
be paid in accordance with clauses first (to reimburse payments made by the
-----
Class D Certificateholders pursuant to subclause (iii) of clause first of
-------------- ------ ----
Section 3.3) and tenth of Section 3.3;
----------- -----
(v) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be paid to it
in accordance with subclause (iii) of clause first of Section 3.3 and
-------------- ------ ----- -----------
clauses second, third, fourth and fifth of Section 3.3; and
------- ------ ----- ------ ----- -----------
(vi) Each Trustee shall set forth the amounts to be paid in
accordance with clause sixth of Section 3.3.
------ ----- -----------
(c) At such time as a Trustee or a Liquidity Provider shall have
received all amounts owing to it (and, in the case of the Trustee, the
Certificateholders for which it is acting) pursuant to Section 2.4, 3.2 or 3.3,
----------- --- ---
as applicable, and, in the case of a Liquidity Provider, its commitment under
the related Liquidity Facility shall have terminated or expired, such Person
29
[2001-1 Intercreditor Agreement]
shall, by a Written Notice, so inform the Subordination Agent and each other
party to this Agreement.
(d) As provided in Section 6.5, the Subordination Agent shall be
-----------
fully protected in relying on any of the information set forth in a Written
Notice provided by any Trustee or any Liquidity Provider pursuant to Sections
--------
3.1(a) through (c) above and shall have no independent obligation to verify,
------ ---
calculate or recalculate any amount set forth in any Written Notice delivered in
accordance with such paragraphs.
(e) Any Written Notice delivered by a Trustee or a Liquidity
Provider, as applicable, pursuant to Section 3.1(a), 3.1(b) or 3.1(c), if made
-------------- ------ ------
prior to 10:00 A.M. (New York City time) on any Business Day shall be effective
on the date delivered (or if delivered later on a Business Day or if delivered
on a day which is not a Business Day shall be effective as of the next Business
Day). Subject to the terms of this Agreement, the Subordination Agent shall as
promptly as practicable comply with any such instructions; provided, however,
-------- -------
that any transfer of funds pursuant to any instruction received after 10:00 A.M.
(New York City time) on any Business Day may be made on the next succeeding
Business Day.
(f) If the Subordination Agent shall not receive from any Person any
information set forth in Section 3.1(a) or (b) above which is required to
-------------- ---
enable the Subordination Agent to make a distribution to such Person pursuant to
Sections 2.4(b), 3.2 or 3.3, the Subordination Agent shall request such
--------------- --- ---
information and, failing to receive any such information, the Subordination
Agent shall not make such distribution(s) to such Person. In such event, the
Subordination Agent shall make distributions pursuant to clauses first
------- -----
through ninth of Section 2.4(b), clauses first through tenth of Section 3.2 and
----- -------------- ------- ----- ----- -----------
clauses first through tenth of Section 3.3 to the extent it shall have
------------- ----- -----------
sufficient information to enable it to make such distributions, and shall
continue to hold any funds remaining, after making such distributions, until the
Subordination Agent shall receive all necessary information to enable it to
distribute any funds so withheld.
(g) On such dates (but not more frequently than monthly) as any
Liquidity Provider or any Trustee shall request, but in any event automatically
at the end of each calendar quarter, the Subordination Agent shall send to such
party a written statement reflecting all amounts on deposit with the
Subordination Agent pursuant to Section 3.1(f).
--------------
3.2 Distribution of Amounts on Deposit in the Collection Account. Except
------------------------------------------------------------
as otherwise provided in Sections 2.4, 3.1(f), 3.3, 3.4 and 3.6(b), amounts on
------------ ------ --- --- ------
deposit in the Collection Account (or, in the case of any amount described in
Section 2.4(c), on deposit in the Special Payments Account) shall be promptly
--------------
distributed on each Regular Distribution Date (or in the case of any amount
described in Section 2.4(c), on the Special Distribution Date thereof) in the
--------------
following order of priority and in accordance with the information provided to
the Subordination Agent pursuant to Section 3.1(a):
--------------
First, such amount as shall be required to pay all accrued and unpaid
-----
Liquidity Expenses owed to each Liquidity Provider shall be distributed to
the Liquidity Providers pro rata on the basis of the amount of Liquidity
Expenses owed to each Liquidity Provider;
30
[2001-1 Intercreditor Agreement]
Second, such amount as shall be required to pay in full the aggregate
------
amount of interest accrued on all Liquidity Obligations (at the rate
provided in the applicable Liquidity Facility) shall be distributed to the
Liquidity Providers pro rata on the basis of the amount of Liquidity
Obligations owed to each Liquidity Provider;
Third, such amount as shall be required (A) if any Cash Collateral
-----
Account relating to a Liquidity Facility had been previously funded as
provided in Section 3.6(f), to fund such Cash Collateral Account up to its
--------------
Required Amount shall be deposited in such Cash Collateral Account, (B) if
any Liquidity Facility shall become a Downgraded Facility or a Non-Extended
Facility at a time when unreimbursed Interest Drawings under such Liquidity
Facility have reduced the Available Amount thereunder to zero, to fund the
relevant Cash Collateral Account up to its Required Amount shall be
deposited in such Cash Collateral Account and (C) if, with respect to any
particular Liquidity Facility, neither subclause (A) nor subclause (B) of
------------- --------------
this clause third are applicable, to pay or reimburse the Liquidity
------ -----
Provider in respect of such Liquidity Facility, in each case in an amount
equal to the amount of all Liquidity Obligations then due under such
Liquidity Facility (other than amounts payable pursuant to clause first or
------ -----
second of this Section 3.2) shall be distributed to such Liquidity
------ -----------
Provider, pro rata on the basis of the amounts of all such unreimbursed
Liquidity Obligations and/or deficiencies in respect of each Liquidity
Provider;
Fourth, if, with respect to any particular Liquidity Facility, either
------
subclause (A) or (B) of clause third above is applicable, then the
------------- --- ------ -----
Liquidity Provider with respect to such Liquidity Facility shall be paid
the excess of (x) the aggregate outstanding amount of unreimbursed Advances
(whether or not then due) under such Liquidity Facility over (y) the
Required Amount for the relevant Class, pro rata on the basis of such
amounts in respect of each Liquidity Provider;
Fifth, such amount as shall be required to pay in full Expected
-----
Distributions to the holders of the Class A-1 Certificates on such
Distribution Date shall be distributed to the Class A-1 Trustee, such
amount as shall be required to pay in full Expected Distributions to the
holders of the Class A-2 Certificates on such Distribution Date shall be
distributed to the Class A-2 Trustee and such amount as shall be required
to pay in full Expected Distributions to the holders of the Class A-3
Certificates on such Distribution Date shall be distributed to the Class X-
0 Trustee, pro rata on the basis of such amounts in respect of each such
Class of Certificates;
Sixth, such amount as shall be required to pay in full Expected
-----
Distributions to the holders of the Class B Certificates on such
Distribution Date shall be distributed to the Class B Trustee;
Seventh, such amount as shall be required to pay in full Expected
-------
Distributions to the holders of the Class C Certificates on such
Distribution Date shall be distributed to the Class C Trustee;
31
[2001-1 Intercreditor Agreement]
Eighth, such amount as shall be required to pay in full the Expected
------
Distributions to the holders of the Class D Certificates on such
Distribution Date shall be distributed to the Class D Trustee;
Ninth, such amount as shall be required to pay in full the aggregate
-----
unpaid amount of fees and expenses payable as of such Distribution Date to
the Subordination Agent and the Trustees pursuant to the terms of this
Agreement and the Trust Agreements, as the case may be, shall be
distributed to the Subordination Agent and the Trustees; and
Tenth, the balance, if any, of any such payment remaining thereafter
-----
shall be distributed to the Collection Account.
3.3 Distribution of Amounts on Deposit Following a Triggering Event.
---------------------------------------------------------------
Except as otherwise provided in Sections 3.1(f) and 3.6(b), upon the occurrence
--------------- ------
of a Triggering Event and at all times thereafter, all funds in the Collection
Account (including the Special Payments Account) shall be promptly distributed
by the Subordination Agent in the following order of priority:
First, such amount as shall be required to reimburse (i) the
-----
Subordination Agent for any out-of-pocket costs and expenses actually
incurred by it (to the extent not previously reimbursed) in the protection
of, or the realization of the value of, the Notes or any Indenture Estate,
shall be applied by the Subordination Agent in reimbursement of such costs
and expenses, (ii) each Trustee for any amounts of the nature described in
clause (i) above actually incurred by it under the applicable Trust
----------
Agreement (to the extent not previously reimbursed), shall be distributed
to the Trustee and (iii) any Liquidity Provider or Certificateholder for
payments, if any, made by it to the Subordination Agent or any Trustee in
respect of amounts described in clause (i) above, shall be distributed to
----------
such Liquidity Provider or to the Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all amounts
described in clauses (i) through (iii) on
----------- -----
Second, such amount remaining as shall be required to pay all accrued
------
and unpaid Liquidity Expenses shall be distributed to each Liquidity
Provider pro rata on the basis of the amount of Liquidity Expenses owed to
each Liquidity Provider;
Third, such amount remaining as shall be required to pay accrued and
-----
unpaid interest on the Liquidity Obligations as provided in the Liquidity
Facilities shall be distributed to each Liquidity Provider pro rata on the
basis of the amount of such accrued and unpaid interest owed to each
Liquidity Provider;
Fourth, such amount as shall be required (A) if any Cash Collateral
------
Account relating to a Liquidity Facility had been previously funded as
provided in Section 3.6(f) unless (i) a Performing Note Deficiency exists
--------------
and a Liquidity Event of Default shall have occurred and be continuing with
respect to the relevant Liquidity Facility or (ii) a Final Drawing shall
have occurred with respect to the relevant Liquidity Facility, to fund such
Cash Collateral Account up to its Required Amount (less the amount of any
32
[2001-1 Intercreditor Agreement]
repayments of Interest Drawings under such Liquidity Facility while
subclause (A)(i) above is applicable) shall be deposited in such Cash
Collateral Account, (B) if any Liquidity Facility shall become a Downgraded
Facility or a Non-Extended Facility at a time when unreimbursed Interest
Drawings under such Liquidity Facility have reduced the Available Amount
thereunder to zero unless (i) a Performing Note Deficiency exists and a
Liquidity Event of Default shall have occurred and be continuing with
respect to the relevant Liquidity Facility or (ii) a Final Drawing shall
have occurred with respect to the relevant Liquidity Facility, to fund the
relevant Cash Collateral Account up to its Required Amount (less the amount
of any repayments of Interest Drawings under such Liquidity Facility while
subclause (B)(i) above is applicable) shall be deposited in such Cash
Collateral Account and (C) if, with respect to any particular Liquidity
Facility, neither subclause (A) nor subclause (B) of this clause fourth is
------------- ------------- ------ ------
applicable, to pay or reimburse the Liquidity Provider in respect of such
Liquidity Facility, in each case in an amount equal to the amount of all
Liquidity Obligations, whether or not then due under such Liquidity
Facility (other than amounts payable pursuant to clause first, second or
------ ----- ------
third of this Section 3.3), shall be distributed to such Liquidity
----- -----------
Provider, pro rata on the basis of the amounts of such deficiencies and/or
unreimbursed Liquidity Obligations in respect of each Liquidity Provider;
Fifth, if, with respect to any particular Liquidity Facility, either
-----
subclause (A) or (B) of clause fourth above is applicable, then the
------------- - ------ ------
Liquidity Provider with respect to such Liquidity Facility shall be paid
the excess of (x) the aggregate outstanding amount of unreimbursed Advances
(whether or not then due) under such Liquidity Facility over (y) the
Required Amount for the relevant Class (less the amount of any repayments
of Interest Drawings under such Liquidity Facility while subclause (A)(i)
or (B)(i), as the case may be, of clause "fourth" above is applicable), pro
rata on the basis of such amounts in respect of each Liquidity Provider;
Sixth, such amount as shall be required to reimburse or pay (i) the
-----
Subordination Agent for any Tax (other than Taxes imposed on compensation
paid hereunder), expense, fee, charge or other loss incurred by or any
other amount payable to the Subordination Agent in connection with the
transactions contemplated hereby (to the extent not previously reimbursed),
shall be applied by the Subordination Agent in reimbursement of such
amount, (ii) each Trustee for any Tax (other than Taxes imposed on
compensation paid under any Trust Agreement), expense, fee, charge, loss or
any other amount payable to the Trustee under the Trust Agreements (to the
extent not previously reimbursed), shall be distributed to the Trustee and
(iii) each Certificateholder for payments, if any, made by it pursuant to
Section 5.2 in respect of amounts described in clause (i) above, shall be
----------- ----------
distributed to the Trustee for the account of such Certificateholder, in
each such case, pari passu on the basis of all amounts described in clauses
-------
(i) through (iii) above;
--- ---
Seventh, if any Class A-1 Certificates, Class A-2 Certificates or
-------
Class A-3 Certificates are Outstanding on such Distribution Date, such
amount remaining as shall be required to pay in full Adjusted Expected
Distributions on the Class A-1 Certificates shall be distributed to the
Class A-1 Trustee, such amount remaining as shall be required to
33
[2001-1 Intercreditor Agreement]
pay in full Adjusted Expected Distributions on the Class A-2 Certificates
shall be distributed to the Class A-2 Trustee and such amount remaining as
shall be required to pay in full Adjusted Expected Distributions on the
Class A-3 Certificates shall be distributed to the Class A-3 Trustee, pro
rata on the basis of such amounts in respect of each such Class of
Certificates;
Eighth, if any Class B Certificates are Outstanding on such
------
Distribution Date, such amount remaining as shall be required to pay in
full Adjusted Expected Distributions on the Class B Certificates shall be
distributed to the Class B Trustee;
Ninth, if any Class C Certificates are Outstanding on such
-----
Distribution Date, such amount remaining as shall be required to pay in
full Adjusted Expected Distributions on the Class C Certificates shall be
distributed to the Class C Trustee; and
Tenth, if any Class D Certificates are Outstanding on such
-----
Distribution Date, such amount remaining as shall be required to pay in
full Adjusted Expected Distributions on the Class D Certificates shall be
distributed to the Class D Trustee.
3.4 Other Payments. (a) Any payments received by the Subordination Agent
--------------
for which no provision as to the application thereof is made in this Agreement
shall be distributed by the Subordination Agent (i) in the order of priority
specified in Section 3.3 and (ii) to the extent received or realized at any time
-----------
after the Final Distributions for each Class of Certificates have been made in
the manner provided in clause first of Section 3.3.
------ ----- -----------
(b) On any interest payment date under each Liquidity Facility which
is not a Distribution Date, the Subordination Agent shall pay to the Liquidity
Provider under such Liquidity Facility from, and to the extent of, amounts on
deposit in the Collection Account, an amount equal to the amount of interest
then due and payable to such Liquidity Provider under such Liquidity Facility.
The amount of Investment Earnings to be paid or applied pursuant to this Section
3.4(b) or Section 3.6(f) shall reduce the Liquidity Obligations in respect of
interest due to any Liquidity Provider only to the extent actually paid or
applied.
(c) Except as otherwise provided in Section 3.3, if the Subordination
-----------
Agent receives any Scheduled Payment after the Scheduled Payment Date relating
thereto, but prior to such payment becoming an Overdue Scheduled Payment, then
the Subordination Agent shall deposit such Scheduled Payment in the Collection
Account and promptly distribute such Scheduled Payment in accordance with the
priority of distributions set forth in Section 3.2; provided, however, that for
----------- -------- -------
the purposes of this Section 3.4(c) only, each reference in clause ninth of
-------------- ------ ------
Section 3.2 to "Distribution Date" shall be deemed to mean the actual date of
-----------
payment of such Scheduled Payment and each reference in clause fifth, sixth,
------ ----- -----
seventh or eighth of Section 3.2 to "Distribution Date" shall be deemed to refer
------ ------ -----------
to such Scheduled Payment Date.
3.5 Payments to the Trustee and the Liquidity Providers. Any amounts
---------------------------------------------------
distributed hereunder to any Liquidity Provider shall be paid to such Liquidity
Provider by wire transfer of funds to the address such Liquidity Provider shall
provide to the Subordination Agent. The Subordination Agent shall provide a
Written Notice of any such transfer to the applicable Liquidity Provider, as the
case may be, at the time of such transfer. Any amounts distributed hereunder by
the Subordination Agent to any Trustee which shall not be the same institution
as
34
[2001-1 Intercreditor Agreement]
the Subordination Agent shall be paid to such Trustee by wire transfer funds at
the address such Trustee shall provide to the Subordination Agent.
3.6 Liquidity Facilities. (a) Interest Drawings. If on any Distribution
-------------------- -----------------
Date, after giving effect to the subordination provisions of this Agreement, the
Subordination Agent shall not have sufficient funds for the payment of any
amounts due and owing in respect of accrued interest on the Class A-1
Certificates, the Class A-2 Certificates, the Class A-3 Certificates, the Class
B Certificates or the Class C Certificates (at the Stated Interest Rate for such
Class of Certificates), then, prior to 12:00 noon (New York City time) on such
Distribution Date, the Subordination Agent shall request a drawing (each such
drawing or payment, an "Interest Drawing") under the Liquidity Facility with
respect to such Class of Certificates in an amount equal to the lesser of (i) an
amount sufficient to pay the amount of such accrued interest and (ii) the
Available Amount at such time under such Liquidity Facility, and, upon receipt
by the Subordination Agent thereof, shall pay such amounts to the Trustee with
respect to such Class of Certificates in payment of such accrued interest.
(b) Application of Interest Drawings. Notwithstanding anything to
--------------------------------
the contrary contained in this Agreement, (i) all payments received by the
Subordination Agent in respect of an Interest Drawing under the Class A-1
Liquidity Facility and all amounts withdrawn by the Subordination Agent from the
Class A-1 Cash Collateral Account, and payable in each case to the Class A-1
Certificateholders, shall be promptly distributed to the Class A-1 Trustee, (ii)
all payments received by the Subordination Agent in respect of an Interest
Drawing under the Class A-2 Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class A-2 Cash Collateral Account, and payable in
each case to the Class A-2 Certificateholders, shall be promptly distributed to
the Class A-2 Trustee, (iii) all payments received by the Subordination Agent in
respect of an Interest Drawing under the Class A-3 Liquidity Facility and all
amounts withdrawn by the Subordination Agent from the Class A-3 Cash Collateral
Account, and payable in each case to the Class A-3 Certificateholders, shall be
promptly distributed to the Class A-3 Trustee, (iv) all payments received by the
Subordination Agent in respect of an Interest Drawing under the Class B
Liquidity Facility and all amounts withdrawn by the Subordination Agent from the
Class B Cash Collateral Account, and payable in each case to the Class B
Certificateholders, shall be promptly distributed to the Class B Trustee, and
(v) all payments received by the Subordination Agent in respect of an Interest
Drawing under the Class C Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class C Cash Collateral Account, and payable in
each case to the Class C Certificateholders, shall be promptly distributed to
the Class C Trustee.
(c) Downgrade of Liquidity Providers; Downgrade Drawings. If at any
----------------------------------------------------
time any relevant debt rating of any Liquidity Provider is lower than the
applicable Threshold Rating, such Liquidity Provider shall provide notice of
such downgrading in writing to United, the Subordination Agent, the Class A-1
Trustee, the Class A-2 Trustee, the Class A-3 Trustee, the Class B Trustee and
the Class C Trustee. If at any time, any Liquidity Provider's rating is lower
than the applicable Threshold Rating, then within 10 days (or, in the case of
the Class A-1, Class A-2, Class A-3 and Class B Liquidity Facilities, 45 days
for a downgrade from A-1+ to A-1 by Standard & Poor's) after such downgrading
(but no later than the expiration date of the Liquidity Facility issued by the
downgraded Liquidity Provider (the "Downgraded Facility")), such Liquidity
Provider or United may arrange for one or more Replacement Liquidity Providers
to
35
[2001-1 Intercreditor Agreement]
issue and deliver a Replacement Liquidity Facility to the Subordination Agent.
If a Downgraded Facility has not been replaced in accordance with the terms of
this paragraph, the Subordination Agent shall, on such 10th day, or the 45th
day, as the case may be (or if such day is not a Business Day, on the next
succeeding Business Day) (or, if earlier, the expiration date of such Downgraded
Facility) request a drawing in accordance with and to the extent permitted by
such Downgraded Facility (such drawing, a "Downgrade Drawing") of the Available
Amount thereunder. Amounts drawn pursuant to a Downgrade Drawing shall be
maintained and invested as provided in Section 3.6(f). The applicable Liquidity
--------------
Provider may also arrange for one or more Replacement Liquidity Providers to
issue and deliver a Replacement Liquidity Facility at any time after such
Downgrade Drawing so long as such Downgrade Drawing has not been reimbursed in
full to such Liquidity Provider.
(d) Non-Extension Drawings. If any Liquidity Facility with respect
----------------------
to any Class of Certificates is scheduled to expire on a date (the "Stated
Expiration Date") prior to the date that is fifteen (15) days after the Final
Maturity Date for such Class of Certificates, then, no earlier than the 60th day
and no later than the 40th day prior to such Stated Expiration Date (unless such
Stated Expiration Date is on or after the date that is 15 days after the Final
Maturity Date for such Class of Certificates), the Subordination Agent shall
request that the Liquidity Provider for such Liquidity Facility extend the
Stated Expiration Date to the earlier of (i) the date that is 15 days after the
Final Maturity Date for such Class of Certificates and (ii) the date that is the
day immediately preceding the 364th day occurring after the last day of the
Consent Period (as hereinafter defined) (unless the obligations of such
Liquidity Provider are earlier terminated in accordance with such Liquidity
Facility). Whether or not the Liquidity Provider has received such a request
from the Subordination Agent, the Liquidity Provider shall advise the
Subordination Agent, no earlier than the 40/th/ day (or, if earlier, the date of
the Liquidity Provider's receipt of such request, if any, from the Subordination
Agent), and no later than the 25th day prior to the Stated Expiration Date (such
period, with respect to such Liquidity Facility, the "Consent Period"), whether,
in its sole discretion, it agrees to so extend the Stated Expiration Date. If
(A) on or before the date on which such Consent Period ends, such Liquidity
Facility shall not have been replaced in accordance with Section 3.6(e), and (B)
the Liquidity Provider fails irrevocably and unconditionally to advise the
Subordination Agent on or before the date on which such Consent Period ends that
the Stated Expiration Date shall be so extended for such Liquidity Facility, the
Subordination Agent shall on the date on which such Consent Period ends (or as
soon as possible thereafter), in accordance with the terms of the expiring
Liquidity Facility (a "Non-Extended Facility"), request a drawing under such
expiring Liquidity Facility (such drawing, a "Non-Extension Drawing") of all
available and undrawn amounts thereunder. Amounts drawn pursuant to a Non-
Extension Drawing shall be maintained and invested in accordance with Section
-------
3.6(f).
------
(e) Issuance of Replacement Liquidity Facility. (i) At any time,
------------------------------------------
United may, at its option, arrange for Replacement Liquidity Facilities to
replace the Liquidity Facilities for the Class A-1 Certificates, the Class A-2
Certificates, the Class A-3 Certificates, the Class B Certificates and the Class
C Certificates; provided, however, that the initial Liquidity Provider shall not
-------- -------
be replaced by United as a Liquidity Provider with respect to any Class of
Certificates unless (A) there shall have become due to such initial Liquidity
Provider, or such initial Liquidity Provider shall have demanded, amounts
pursuant to Section 3.01, 3.02 or 3.03 of any applicable Liquidity Facility
------------ ---- ----
and the replacement of such initial Liquidity Provider would reduce
36
[2001-1 Intercreditor Agreement]
or eliminate the obligation to pay such amounts or United determines in good
faith that there is a substantial likelihood that such initial Liquidity
Provider will have the right to claim any such amounts (unless such initial
Liquidity Provider waives, in writing, any right it may have to claim such
amounts), which determination shall be set forth in a certificate delivered by
United to such initial Liquidity Provider setting forth the basis for such
determination and accompanied by an opinion of outside counsel selected by
United and reasonably acceptable to such initial Liquidity Provider verifying
the legal conclusions, if any, of such certificate relating to such basis,
provided that, in the case of any likely claim for such amounts based upon any
--------
proposed, or proposed change in, law, rule, regulation, interpretation,
directive, requirement, request or administrative practice, such opinion may
assume the adoption or promulgation of such proposed matter, (B) it shall become
unlawful or impossible for such initial Liquidity Provider (or its Lending
Office) to maintain or fund its LIBOR Advances as described in Section 3.10 of
any Liquidity Facility, (C) any Liquidity Facility of such initial Liquidity
Provider shall become a Downgraded Facility or a Non-Extended Facility or a
Downgrade Drawing or a Non-Extension Drawing shall have occurred under any
Liquidity Facility of such initial Liquidity Provider or (D) such initial
Liquidity Provider shall have breached any of its payment (including, without
limitation, funding) obligations under any Liquidity Facility in respect of
which it is the Liquidity Provider. If such Replacement Liquidity Facility is
provided at any time after a Downgrade Drawing or Non-Extension Drawing has been
made, all funds on deposit in the relevant Cash Collateral Account will be
returned to the Liquidity Provider being replaced. If (x) any Liquidity Provider
shall determine not to extend any of its Liquidity Facilities in accordance with
Section 3.6(d) or (y) any Liquidity Provider has made a Non-Extension Drawing
--------------
under any Liquidity Facility, then such Liquidity Provider may, at its option,
arrange for a Replacement Liquidity Facility to replace such Liquidity Facility
(in the case of clause (x) during the period no earlier than 40 days and no
later than 25 days prior to the then effective Stated Expiration Date of such
Liquidity Facility and in the case of clause (y) at any time after the making of
such Non-Extension Drawing).
(ii) No such Replacement Liquidity Facility executed in connection
therewith shall become effective and no such Replacement Liquidity Facility
shall be deemed a "Liquidity Facility" under the Operative Agreements,
unless and until (i) each of the conditions referred to in Section
-------
3.6(e)(iv) shall have been satisfied and (ii) if such Replacement
----------
Liquidity Facility shall materially adversely affect the rights, remedies,
interests or obligations of the Class A-1 Certificateholders, the Class A-2
Certificateholders, the Class A-3 Certificateholders, the Class B
Certificateholders or the Class C Certificateholders under any of the
Operative Agreements, the applicable Trustee shall have consented, in
writing, to the execution and issuance of such Replacement Liquidity
Facility.
(iii) In connection with the issuance of each Replacement Liquidity
Facility, the Subordination Agent shall (x) prior to the issuance of such
Replacement Liquidity Facility, obtain written confirmation from each
Rating Agency that such Replacement Liquidity Facility will not cause a
reduction of any rating then in effect for the Class A-1 Certificates, the
Class A-2 Certificates, the Class A-3 Certificates, the Class B
Certificates or the Class C Certificates by such Rating Agency (without
regard to any downgrading of any rating of any Liquidity Provider being
replaced pursuant to Section 3.6(c)), (y) pay all Liquidity Obligations
--------------
then owing to the replaced Liquidity
37
[2001-1 Intercreditor Agreement]
Provider (which payment may be made as provided in clause (viii) of Section
------------- -------
3.6(f) pursuant to a drawing under the Replacement Liquidity Facility, or
------
otherwise) and (z) cause the issuer or issuers of the Replacement Liquidity
Facility to deliver the Replacement Liquidity Facility to the Subordination
Agent, together with a legal opinion opining that such Replacement
Liquidity Facility is an enforceable obligation of such Replacement
Liquidity Providers.
(iv) Upon satisfaction of the conditions set forth in Sections
--------
3.6(e)(ii) and 3.6(e)(iii) (w) the replaced Liquidity Facility shall
---------- -----------
terminate, (x) the Subordination Agent shall, if and to the extent so
requested by United or the Liquidity Provider being replaced, execute and
deliver any certificate or other instrument required in order to terminate
the replaced Liquidity Facility, shall surrender the replaced Liquidity
Facility to the Liquidity Provider being replaced and shall execute and
deliver the Replacement Liquidity Facility and any associated Fee Letter,
(y) each of the parties hereto shall enter into any amendments to this
Agreement necessary to give effect to (a) the replacement of the applicable
Liquidity Provider with the applicable Replacement Liquidity Provider and
(b) the replacement of the applicable Liquidity Facility with the
applicable Replacement Liquidity Facility, and (z) the applicable
Replacement Liquidity Provider shall be deemed to be a Liquidity Provider
with the rights and obligations of a Liquidity Provider hereunder and under
the other Operative Agreements and such Replacement Liquidity Facility
shall be deemed to be a Liquidity Facility hereunder and under the other
Operative Agreements.
(f) Cash Collateral Accounts; Withdrawals; Investments. If the
--------------------------------------------------
Subordination Agent shall draw all available amounts under the Class A-1
Liquidity Facility, the Class A-2 Liquidity Facility, the Class A-3 Liquidity
Facility, the Class B Liquidity Facility or the Class C Liquidity Facility
pursuant to Section 3.6(c), 3.6(d) or 3.6(i), or in the event that amounts
-------------- ------ ------
are to be deposited in any Cash Collateral Account related to the Liquidity
Facilities pursuant to subclause (B) of clause third of Section 2.4(b) or 3.2
------------- ------------ -------------- ---
or subclause (B) of clause fourth of Section 3.3, amounts so drawn or
------------- ------------- -----------
to be deposited, as the case may be, shall be deposited by the Subordination
Agent in the Class A-1 Cash Collateral Account, Class A-2 Cash Collateral
Account, the Class A-3 Cash Collateral Account, the Class B Cash Collateral
Account, or the Class C Cash Collateral Account, respectively. Amounts so
deposited in the Cash Collateral Accounts shall be invested in Eligible
Investments in accordance with Section 2.2(b). Investment Earnings on amounts on
--------------
deposit in the Cash Collateral Account with respect to any Liquidity Facility
shall be paid after a Non-Extension Drawing or Downgrade Drawing by the
Subordination Agent to the relevant Liquidity Provider on each Distribution Date
and, to the extent not so paid, together with all other Investment Earnings
shall be deposited in the Collection Account prior to giving effect to the
distributions below on each Distribution Date commencing on the first
Distribution Date after any such Drawing. The Subordination Agent shall deliver
a written statement to United and each Liquidity Provider one day prior to each
Distribution Date setting forth the aggregate amount of Investment Earnings held
in the Cash Collateral Accounts as of such date. In addition, from and after the
date funds are so deposited, the Subordination Agent shall make withdrawals from
such account as follows:
(i) on each Distribution Date, the Subordination Agent shall, to the
extent it shall not have received funds to pay accrued and unpaid interest
due and payable
38
[2001-1 Intercreditor Agreement]
on the Class A-1 Certificates from any other source, withdraw from the
Class A-1 Cash Collateral Account, and pay to the Class A-1 Trustee for the
benefit of the Class A-1 Certificateholders, an amount equal to the lesser
of (x) an amount necessary to pay accrued and unpaid interest on such Class
A-1 Certificates and (y) the amount on deposit in the Class A-1 Cash
Collateral Account;
(ii) on each Distribution Date, the Subordination Agent shall, to
the extent it shall not have received funds to pay accrued and unpaid
interest due and payable on the Class A-2 Certificates from any other
source, withdraw from the Class A-2 Cash Collateral Account, and pay to the
Class A-2 Trustee for the benefit of the Class A-2 Certificateholders, an
amount equal to the lesser of (x) an amount necessary to pay accrued and
unpaid interest on such Class A-2 Certificates and (y) the amount on
deposit in the Class A-2 Cash Collateral Account;
(iii) on each Distribution Date, the Subordination Agent shall, to
the extent it shall not have received funds to pay accrued and unpaid
interest due and payable on the Class A-3 Certificates from any other
source, withdraw from the Class A-3 Cash Collateral Account, and pay to the
Class A-3 Trustee for the benefit of the Class A-3 Certificateholders, an
amount equal to the lesser of (x) an amount necessary to pay accrued and
unpaid interest on such Class A-3 Certificates and (y) the amount on
deposit in the Class A-3 Cash Collateral Account;
(iv) on each Distribution Date, the Subordination Agent shall, to
the extent it shall not have received funds to pay accrued and unpaid
interest due and payable on the Class B Certificates from any other source,
withdraw from the Class B Cash Collateral Account, and pay to the Class B
Trustee for the benefit of the Class B Certificateholders, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid interest
on such Class B Certificates and (y) the amount on deposit in the Class B
Cash Collateral Account;
(v) on each Distribution Date, the Subordination Agent shall, to
the extent it shall not have received funds to pay accrued and unpaid
interest due and payable on the Class C Certificates from any other source,
withdraw from the Class C Cash Collateral Account, and pay to the Class C
Trustee for the benefit of the Class C Certificateholders, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid interest
on such Class C Certificates and (y) the amount on deposit in the Class C
Cash Collateral Account;
(vi) on each date on which the Pool Balance of the Class A-1 Trust
shall have been reduced by payments made to the Class A-1
Certificateholders pursuant to Section 2.4, 3.2 or 3.3, the Subordination
----------- --- ---
Agent shall withdraw from the (after giving effect to the reduction of the
Pool Balance on such date, any prior withdrawal of amounts on deposit in
Class A-1 Cash Collateral Account on such date and any transfer of
Investment Earnings from such Cash Collateral Account to the Collection
Account or the Special Payments Account on such date) an amount equal to
the sum of the Required Amount (with respect to the Class A-1 Liquidity
Facility) plus any Investment Earnings remaining
39
[2001-1 Intercreditor Agreement]
on deposit in such Cash Collateral Account will be on deposit in the Class
A-1 Cash Collateral Account and shall first, pay such amount to the Class
A-1 Liquidity Provider until the Liquidity Obligations (with respect to the
Class A-1 Certificates) owing to such Liquidity Provider shall have been
paid in full, and second, deposit any remaining amount into the Collection
Account;
(vii) on each date on which the Pool Balance of the Class A-2 Trust
shall have been reduced by payments made to the Class A-2
Certificateholders pursuant to Section 2.4, 3.2 or 3.3, the Subordination
----------- --- ---
Agent shall withdraw from the Class A-2 Cash Collateral Account such amount
as is necessary so that (after giving effect to the reduction of the Pool
Balance on such date, any prior withdrawal of amounts on deposit in the
Class A-2 Cash Collateral Account on such date and any transfer of
Investment Earnings from such Cash Collateral Account to the Collection
Account or the Special Payments Account on such date) an amount equal to
the sum of the Required Amount (with respect to the Class A-2 Liquidity
Facility) plus any Investment Earnings remaining on deposit in such Cash
Collateral Account will be on deposit in the Class A-2 Cash Collateral
Account and shall first, pay such amount to the Class A-2 Liquidity
-----
Provider until the Liquidity Obligations (with respect to the Class A-2
Certificates) owing to such Liquidity Provider shall have been paid in
full, and second, deposit any remaining amount into the Collection Account;
------
(viii) on each date on which the Pool Balance of the Class A-3 Trust
shall have been reduced by payments made to the Class A-3
Certificateholders pursuant to Section 2.4, 3.2 or 3.3, the Subordination
----------- --- ---
Agent shall withdraw from the Class A-3 Cash Collateral Account such amount
as is necessary so that (after giving effect to the reduction of the Pool
Balance on such date, any prior withdrawal of amounts on deposit in the
Class A-3 Cash Collateral Account on such date and any transfer of
Investment Earnings from such Cash Collateral Account to the Collection
Account or the Special Payments Account on such date) an amount equal to
the sum of the Required Amount (with respect to the Class A-3 Liquidity
Facility) plus any Investment Earnings remaining on deposit in such Cash
Collateral Account will be on deposit in the Class A-3 Cash Collateral
Account and shall first, pay such amount to the Class A-3 Liquidity
-----
Provider until the Liquidity Obligations (with respect to the Class A-3
Certificates) owing to such Liquidity Provider shall have been paid in
full, and second, deposit any remaining amount into the Collection Account;
------
(ix) on each date on which the Pool Balance of the Class B Trust
shall have been reduced by payments made to the Class B Certificateholders
pursuant to Section 2.4, 3.2 or 3.3, the Subordination Agent shall withdraw
----------- --- ---
from the Class B Cash Collateral Account such amount as is necessary so
that (after giving effect to the reduction of the Pool Balance on such
date, any prior withdrawal of amounts on deposit in the Class B Cash
Collateral Account on such date and any transfer of Investment Earnings
from such Cash Collateral Account to the Collection Account or the Special
Payments Account on such date) an amount equal to the sum of the Required
Amount (with respect to the Class B Liquidity Facility) plus any Investment
Earnings remaining on deposit in such Cash Collateral Account will be on
deposit in the Class B Cash Collateral Account and shall first, pay such
-----
amount to the Class Liquidity Provider
40
[2001-1 Intercreditor Agreement]
until the Liquidity Obligations (with respect to the Class B Certificates)
owing to such Liquidity Provider shall have been paid in full, and second,
------
deposit any remaining amount into the Collection Account;
(x) on each date on which the Pool Balance of the Class C Trust
shall have been reduced by payments made to the Class C Certificateholders
pursuant to Section 2.4, 3.2 or 3.3, the Subordination Agent shall withdraw
----------- --- ---
from the Class C Cash Collateral Account such amount as is necessary so
that (after giving effect to the reduction of the Pool Balance on such
date, any prior withdrawal of amounts on deposit in the Class C Cash
Collateral Account on such date and any transfer of Investment Earnings
from such Cash Collateral Account to the Collection Account or the Special
Payments Account on such date) an amount equal to the sum of the Required
Amount (with respect to the Class C Liquidity Facility) plus any Investment
Earnings remaining on deposit in such Cash Collateral Account will be on
deposit in the Class C Cash Collateral Account and shall first, pay such
-----
amount to the Class C Liquidity Provider until the Liquidity Obligations
(with respect to the Class C Certificates) owing to such Liquidity Provider
shall have been paid in full, and second, deposit any remaining amount into
------
the Collection Account;
(xi) if a Replacement Liquidity Facility for any Class of
Certificates shall be delivered to the Subordination Agent following the
date on which funds have been deposited into the Cash Collateral Account
related to the Liquidity Facility for such Class of Certificates, the
Subordination Agent shall withdraw all amounts on deposit in such Cash
Collateral Account and shall pay such amounts to the replaced Liquidity
Provider until all Liquidity Obligations owed to such Person shall have
been paid in full pro rata on the basis of the amount of Liquidity
--- ----
Obligations owed to each Liquidity Provider, and shall deposit any
remaining amount in the Collection Account; and
(xii) following the payment of Final Distributions with respect
to the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3
Certificates, the Class B Certificates or the Class C Certificates, on the
date on which the Subordination Agent shall have been notified by any
Liquidity Provider for such Class of Certificates that the Liquidity
Obligations owed to such Liquidity Provider have been paid in full, the
Subordination Agent shall withdraw all amounts on deposit in the Cash
Collateral Account related to the Liquidity Facility in respect of such
Class of Certificates and shall deposit such amount into the Collection
Account.
(g) Reinstatement. With respect to any Interest Drawing under the
-------------
Liquidity Facility for any Trust, upon the reimbursement of each applicable
Liquidity Provider for all or any part of the amount of such Interest Drawing,
together with any accrued interest thereon, the Available Amount of such
Liquidity Facility shall be reinstated by an amount equal to the amount of such
Interest Drawing so reimbursed to the relevant Liquidity Provider, but not to
exceed the Stated Amount for such Liquidity Facility; provided, however, that
-------- -------
such Liquidity Facility shall not be so reinstated in part or in full at any
time if (x) both a Performing Note Deficiency exists and a Liquidity Event of
Default shall have occurred and be continuing with respect to the relevant
Liquidity Facility or (y) a Final Drawing shall have occurred with respect to
such Liquidity Facility. In the event that, with respect to any particular
Liquidity Facility,
41
[2001-1 Intercreditor Agreement]
(i) funds are withdrawn from the related Cash Collateral Account pursuant to
clauses (i), (ii), (iii), (iv) or (v) of Section 3.6(f) or (ii) such Liquidity
--- ---- ----- ---- --------------
Facility shall become a Downgraded Facility or Non-Extended Facility at a time
when unreimbursed Interest Drawings under such Liquidity Facility have reduced
the Available Amount thereunder to zero, then funds received by the
Subordination Agent at any time other than (x) any time when a Liquidity Event
of Default shall have occurred and be continuing with respect to such Liquidity
Facility and a Performing Note Deficiency exists or (y) any time after a Final
Drawing shall have occurred with respect to such Liquidity Facility, shall be
deposited in such applicable Cash Collateral Account as provided in clause third
------ -----
of Section 2.4(b), clause third of Section 3.2 or clause fourth of Section 3.3,
-------------- ------ ----- ----------- ------ ------ -----------
as applicable, and applied in accordance with Section 3.6(f).
--------------
(h) Reimbursement. The amount of each drawing under the Liquidity
-------------
Facilities shall be due and payable, together with interest thereon, on the
dates and at the rates, respectively, provided in the Liquidity Facilities.
(i) Final Drawing upon Termination Notice. Upon receipt from a
-------------------------------------
Liquidity Provider of a Termination Notice with respect to any Liquidity
Facility, the Subordination Agent shall, not later than the date specified in
such Termination Notice, in accordance with and to the extent permitted by the
terms of such Liquidity Facility, request a drawing under such Liquidity
Facility of all available and undrawn amounts thereunder (a "Final Drawing").
Amounts drawn pursuant to a Final Drawing shall be maintained and invested in
accordance with Section 3.6(f).
--------------
(j) Reduction of Stated Amount. Promptly following each date on
--------------------------
which the Required Amount of the Liquidity Facility for a Class of Certificates
is reduced as a result of a reduction in the Pool Balance with respect to such
Certificates, the Stated Amount of such Liquidity Facility shall automatically
be reduced to an amount equal to the Required Amount with respect to such
Liquidity Facility (as calculated by the Subordination Agent after giving effect
to such payment).
(k) Relation to Subordination Provisions. Interest Drawings under
------------------------------------
the Liquidity Facilities and withdrawals from the Cash Collateral Accounts, in
each case, in respect of interest on the Certificates of the Class A-1
Certificates, the Class A-2 Certificates, the Class A-3 Certificates, the Class
B Certificates, or the Class C Certificates shall be distributed to the Trustee
for such Class of Certificates, notwithstanding Sections 2.4 , 3.2 and 3.3.
------------- --- ---
(l) Assignment of Liquidity Facility. The Subordination Agent
--------------------------------
agrees not to consent to the assignment by any Liquidity Provider of any of its
rights or obligations under any Liquidity Facility or any interest therein,
unless (i) United shall have consented to such assignment and (ii) each Rating
Agency shall have provided a Ratings Confirmation in respect of such assignment,
and the foregoing is not intended to and shall not be construed to limit the
rights of the Liquidity Provider set forth in the last sentence of Section
3.6(e)(i).
42
[2001-1 Intercreditor Agreement]
ARTICLE IV
EXERCISE OF REMEDIES
4.1 Directions from the Controlling Party. (a) (i) Following the
-------------------------------------
occurrence and during the continuation of an Indenture Default under any
Indenture, the Controlling Party shall direct the Subordination Agent, which in
turn shall direct the Indenture Trustee under such Indenture in the exercise of
remedies available to the holders of the Notes issued pursuant to such
Indenture. Such remedies shall include the ability to vote all such Notes in
favor of declaring all of the unpaid principal amount of such Notes and accrued
interest thereon to be due and payable under, and in accordance with, the
provisions of such Indenture. If the Notes issued pursuant to any Indenture have
been Accelerated following an Indenture Default with respect thereto, the
Controlling Party may direct the Subordination Agent to sell, assign, contract
to sell or otherwise dispose of and deliver all (but not less than all) of such
Notes to any Person at public or private sale, at any location at the option of
the Controlling Party, all upon such terms and conditions as it may reasonably
deem advisable in accordance with applicable law.
(ii) Notwithstanding the foregoing, so long as any Certificates
remain Outstanding, during the period ending on the date which is nine
months after the earliest to occur of (y) the Acceleration of the Notes
issued pursuant to any Indenture and (z) the occurrence of a United
Bankruptcy Event, without the consent of each Trustee (other than any
Trustee of a Trust to the extent that United or any Affiliate of United
holds a majority-in-interest of the Certificates issued by such Trust), no
Aircraft subject to the Lien of any Indenture or Notes may be sold if the
net proceeds from such sale would be less than the Minimum Sale Price for
such Aircraft or such Note.
(iii) At the request of the Controlling Party, the Subordination
Agent may from time to time during the continuance of an Indenture Default
in respect of an Indenture (and before the occurrence of a Triggering
Event) commission Appraisals with respect to the Aircraft, subject to such
Indenture.
(iv) After a Triggering Event occurs and any Note becomes a Non-
Performing Equipment Note, the Subordination Agent shall obtain Appraisals
with respect to all of the Aircraft (the "LTV Appraisals") as soon as
practicable and additional LTV Appraisals on or prior to each anniversary
of the date of such initial LTV Appraisals; provided, however, that if the
-------- -------
Controlling Party reasonably objects to the appraised value of the Aircraft
shown in such LTV Appraisals, the Controlling Party shall have the right to
obtain or cause to be obtained substitute LTV Appraisals (including LTV
Appraisals based upon physical inspection of the Aircraft).
(b) Following the occurrence and during the continuance of an
Indenture Default under any Indenture, the Controlling Party shall take such
actions as it may reasonably deem most effectual to complete the sale or other
disposition of the relevant Aircraft or related Notes. In addition, in lieu of
any sale, assignment, contract to sell or other disposition, the Controlling
Party may maintain possession of such Notes and continue to apply monies
received in respect of such Notes in accordance with Article III. In addition,
------- ---
in lieu of such sale, assignment, contract to sell or other disposition, or in
lieu of such maintenance of possession, the
43
[2001-1 Intercreditor Agreement]
Controlling Party may instruct the Indenture Trustee under such Indenture to
foreclose on the Lien on the related Aircraft.
4.2 Remedies Cumulative. Each and every right, power and remedy given to
-------------------
the Trustees, the Liquidity Providers, the Controlling Party or the
Subordination Agent specifically or otherwise in this Agreement shall be
cumulative and shall be in addition to every other right, power and remedy
herein specifically given or now or hereafter existing at law, in equity or by
statute, and each and every right, power and remedy whether specifically herein
given or otherwise existing may, subject always to the terms and conditions
hereof, be exercised from time to time and as often and in such order as may be
deemed expedient by any Trustee, the Liquidity Providers, the Controlling Party
or the Subordination Agent, as appropriate, and the exercise or the beginning of
the exercise of any power or remedy shall not be construed to be a waiver of the
right to exercise at the same time or thereafter any other right, power or
remedy. No delay or omission by any Trustee, the Liquidity Providers, the
Controlling Party or the Subordination Agent in the exercise of any right,
remedy or power or in the pursuit of any remedy shall impair any such right,
power or remedy or be construed to be a waiver of any default or to be an
acquiescence therein.
4.3 Discontinuance of Proceedings. If any party to this Agreement
-----------------------------
(including the Controlling Party in such capacity) shall have instituted any
Proceeding to enforce any right, power or remedy under this Agreement by
foreclosure, entry or otherwise, and such Proceeding shall have been
discontinued or abandoned for any reason or shall have been determined adversely
to the Person instituting such Proceeding, then and in every such case each such
party shall, subject to any determination in such Proceeding, be restored to its
former position and rights hereunder, and all rights, remedies and powers of
such party shall continue as if no such Proceeding had been instituted.
4.4 Right of Certificateholders to Receive Payments Not to Be Impaired.
------------------------------------------------------------------
Anything in this Agreement to the contrary notwithstanding but subject to each
Trust Agreement, the right of any Certificateholder or any Liquidity Provider,
respectively, to receive payments hereunder (including pursuant to Section 2.4,
-----------
3.2 or 3.3) when due, or to institute suit for the enforcement of any such
--- ---
payment on or after the applicable Distribution Date, shall not be impaired or
affected without the consent of such Certificateholder or such Liquidity
Provider, respectively.
4.5 Undertaking for Costs. In any suit for the enforcement of any right
---------------------
or remedy under this Agreement or in any suit against any Controlling Party or
the Subordination Agent for any action taken or omitted by it as Controlling
Party or Subordination Agent, as the case may be, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. The provisions of this Section
-------
4.5 do not apply to a suit instituted by the Subordination Agent, a Liquidity
---
Provider or a Trustee or a suit by Certificateholders holding more than 10% of
the original principal amount of any Class of Certificates.
44
[2001-1 Intercreditor Agreement]
ARTICLE V
DUTIES OF THE SUBORDINATION AGENT;
AGREEMENTS OF TRUSTEES, ETC.
5.1 Notice of Indenture Default or Triggering Event. (a) If the
-----------------------------------------------
Subordination Agent shall have actual knowledge of the occurrence of an
Indenture Default or a Triggering Event, as promptly as practicable, and in any
event within 10 days after obtaining knowledge thereof, the Subordination Agent
shall transmit by mail or courier to the Rating Agencies, the Liquidity
Providers and the Trustees notice of such Indenture Default or Triggering Event,
unless such Indenture Default or Triggering Event shall have been cured or
waived. For all purposes of this Agreement, in the absence of actual knowledge
on the part of a Responsible Officer, the Subordination Agent shall not be
deemed to have knowledge of any Indenture Default or Triggering Event unless
notified in writing by one or more Trustees, one or more Liquidity Providers or
one or more Certificateholders.
(b) Other Notices. The Subordination Agent will furnish to each
-------------
Liquidity Provider and each Trustee, promptly upon receipt thereof, duplicates
or copies of all reports, notices, requests, demands, certificates, financial
statements and other instruments furnished to the Subordination Agent as
registered holder of the Notes or otherwise in its capacity as Subordination
Agent to the extent the same shall not have been otherwise directly distributed
to such Liquidity Provider or the Trustee, as applicable, pursuant to the
express provision of any other Operative Agreement.
5.2 Indemnification. The Subordination Agent shall not be required to
---------------
take any action or refrain from taking any action under Section 5.1 (other than
-----------
the first sentence thereof) or Article IV unless the Subordination Agent shall
----------
have been indemnified (to the extent and in the manner reasonably satisfactory
to the Subordination Agent) against any liability, cost or expense (including
counsel fees and expenses) which may be incurred in connection therewith. The
Subordination Agent shall not be under any obligation to take any action under
this Agreement and nothing contained in this Agreement shall require the
Subordination Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. The Subordination Agent shall not
be required to take any action under Section 5.1 (other than the first sentence
-----------
thereof) or Article IV, nor shall any other provision of this Agreement be
----------
deemed to impose a duty on the Subordination Agent to take any action, if the
Subordination Agent shall have been advised by counsel that such action is
contrary to the terms hereof or is otherwise contrary to law.
5.3 No Duties Except as Specified in Intercreditor Agreement. The
--------------------------------------------------------
Subordination Agent shall not have any duty or obligation to take or refrain
from taking any action under, or in connection with, this Agreement, except as
expressly provided by the terms of this Agreement; and no implied duties or
obligations shall be read into this Agreement against the Subordination Agent.
The Subordination Agent agrees that it will, in its individual capacity and at
its own cost and expense (but without any right of indemnity in respect of any
such cost or expense) promptly take such action as may be necessary to duly
discharge all Liens on any of the Trust Accounts or any monies deposited therein
which result from claims against it in its individual capacity not related to
its activities hereunder or any other Operative Agreement.
45
[2001-1 Intercreditor Agreement]
5.4 Notice from the Liquidity Providers and Trustee. If any Liquidity
-----------------------------------------------
Provider or any Trustee has notice of an Indenture Default or a Triggering
Event, such Person shall promptly give notice thereof to all other Liquidity
Providers, to the Trustees and to the Subordination Agent, provided, however,
-------- -------
that no such Person shall have any liability hereunder as a result of its
failure to deliver any such notice.
ARTICLE VI
THE SUBORDINATION AGENT
6.1 Acceptance of Trusts and Duties. Each of the Class A-1 Trustee, the
-------------------------------
Class A-2 Trustee, the Class A-3 Trustee, the Class B Trustee, the Class C
Trustee and the Class D Trustee hereby designates and appoints the Subordination
Agent as the agent and trustee of such Trustee under the applicable Liquidity
Facility and authorizes the Subordination Agent to enter into the applicable
Liquidity Facility as agent and trustee for such Trustee. Each of the Liquidity
Providers and each of the Trustees hereby designates and appoints State Street
as the Subordination Agent under this Agreement. State Street hereby accepts the
duties hereby created and applicable to it as the Subordination Agent and agrees
to perform the same but only upon the terms of this Agreement and agrees to
receive and disburse all monies received by it in accordance with the terms
hereof. The Subordination Agent shall not be answerable or accountable under any
circumstances, except (a) for its own willful misconduct or gross negligence or
for its negligence in the receipt and disbursement of funds, (b) as provided in
Section 2.2 or 5.3 and (c) for liabilities that may result from the material
----------- ---
inaccuracy of any representation or warranty of the Subordination Agent made in
its individual capacity in any Operative Agreement. The Subordination Agent
shall not be liable for any error of judgment made in good faith by a
Responsible Officer of the Subordination Agent, unless it is proved that the
Subordination Agent was negligent in ascertaining the pertinent facts.
6.2 Absence of Duties. The Subordination Agent shall have no duty to see
-----------------
to any recording or filing of this Agreement or any other document, or to see to
the maintenance of any such recording or filing.
6.3 No Representations or Warranties as to Documents. The Subordination
------------------------------------------------
Agent in its individual capacity does not make nor shall be deemed to have made
any representation or warranty as to the validity, legality or enforceability of
this Agreement or any other Operative Agreement or as to the correctness of any
statement contained in any thereof, except for the representations and
warranties of the Subordination Agent, made in its individual capacity, under
any Operative Agreement to which it is a party. The Certificateholders, the
Trustees and the Liquidity Providers make no representation or warranty
hereunder whatsoever.
6.4 No Segregation of Monies; No Interest. Any monies paid to or retained
-------------------------------------
by the Subordination Agent pursuant to any provision hereof and not then
required to be distributed to any Trustee or any Liquidity Provider as provided
in Articles II and III need not be segregated in any manner except to the extent
----------- ---
required by such Articles II and III and by law, and the Subordination Agent
----------- ---
shall not (except as otherwise provided in Section 2.2) be liable for any
-----------
interest thereon; provided, however, that any payments received or applied
-------- -------
hereunder by the
46
[2001-1 Intercreditor Agreement]
Subordination Agent shall be accounted for by the Subordination Agent so that
any portion thereof paid or applied pursuant hereto shall be identifiable as to
the source thereof.
6.5 Reliance; Agents; Advice of Counsel. The Subordination Agent shall
-----------------------------------
not incur liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document or paper believed by it to be genuine and believed by it to be signed
by the proper party or parties. As to the Pool Balance of any Trust as of any
date, the Subordination Agent may for all purposes hereof rely on a certificate
signed by any Responsible Officer of the Trustee, and such certificate shall
constitute full protection to the Subordination Agent for any action taken or
omitted to be taken by it in good faith in reliance thereon. As to any fact or
matter relating to the Liquidity Providers or the Trustees the manner of
ascertainment of which is not specifically described herein, the Subordination
Agent may for all purposes hereof rely on a certificate, signed by any
Responsible Officer of the applicable Liquidity Provider or the Trustee, as the
case may be, as to such fact or matter, and such certificate shall constitute
full protection to the Subordination Agent for any action taken or omitted to be
taken by it in good faith in reliance thereon. The Subordination Agent shall
assume, and shall be fully protected in assuming, that each of the Liquidity
Providers and each of the Trustees are authorized to enter into this Agreement
and to take all action to be taken by them pursuant to the provisions hereof,
and shall not inquire into the authorization of each of the Liquidity Providers
and each of the Trustees with respect thereto. In the administration of the
trusts hereunder, the Subordination Agent may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or through
agents or attorneys and may consult with counsel, accountants and other skilled
persons to be selected and retained by it, and the Subordination Agent shall not
be liable for the acts or omissions of any agent appointed with due care or for
anything done, suffered or omitted in good faith by it in accordance with the
advice or written opinion of any such counsel, accountants or other skilled
persons.
6.6 Capacity in Which Acting. The Subordination Agent acts hereunder
------------------------
solely as agent and trustee herein and not in its individual capacity, except as
otherwise expressly provided in the Operative Agreements.
6.7 Compensation. The Subordination Agent shall be entitled to reasonable
------------
compensation, including expenses and disbursements, for all services rendered
hereunder and shall have a priority claim to the extent set forth in Article III
-----------
on all monies collected hereunder for the payment of such compensation, to the
extent that such compensation shall not be paid by others. The Subordination
Agent agrees that it shall have no right against any Trustee or any Liquidity
Provider for any fee as compensation for its services as agent under this
Agreement. The provisions of this Section 6.7 shall survive the termination of
-----------
this Agreement.
6.8 May Become Certificateholder. The institution acting as Subordination
----------------------------
Agent hereunder may become a Certificateholder and have all rights and benefits
of a Certificateholder to the same extent as if it were not the institution
acting as the Subordination Agent.
6.9 Subordination Agent Required; Eligibility. There shall at all times
-----------------------------------------
be a Subordination Agent hereunder which shall be a corporation organized and
doing business under the laws of the United States of America or of any state or
territory thereof or the District of
47
[2001-1 Intercreditor Agreement]
Columbia having a combined capital and surplus of at least $75,000,000 (or
$5,000,000 and the obligations of which, whether now in existence or hereafter
incurred, are fully and unconditionally guaranteed by a corporation organized
and doing business under the laws of the United States, any state or territory
thereof or of the District of Columbia and having a combined capital and surplus
of at least $75,000,000), if there is such an institution willing and able to
perform the duties of the Subordination Agent hereunder upon reasonable or
customary terms. Such corporation shall be a Citizen of the United States and
shall be authorized under the laws of the United States or any State or
territory thereof or of the District of Columbia to exercise corporate trust
powers and shall be subject to supervision or examination by federal, state,
territorial or District of Columbia authorities. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of any of the aforesaid supervising or examining authorities, then, for the
purposes of this Section 6.9, the combined capital and surplus of such
-----------
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.
In case at any time the Subordination Agent shall cease to be eligible in
accordance with the provisions of this Section, the Subordination Agent shall
resign immediately in the manner and with the effect specified in Section 8.1.
-----------
6.10 Money to Be Held in Trust. All Notes, monies and other property
-------------------------
deposited with or held by the Subordination Agent pursuant to this Agreement
shall be held in trust for the benefit of the parties entitled to such Notes,
monies and other property. All such Notes, monies or other property shall be
held in the Trust Department of the institution acting as Subordination Agent
hereunder.
ARTICLE VII
[RESERVED]
ARTICLE VIII
SUCCESSOR SUBORDINATION AGENT
8.1 Replacement of Subordination Agent; Appointment of Successor. The
------------------------------------------------------------
Subordination Agent may resign at any time by so notifying the Trustee and the
Liquidity Providers. United (so long as no "Event of Default" has occurred and
is continuing under any Indenture or Lease (as such term is defined therein)) or
the Controlling Party may remove the Subordination Agent for cause by so
notifying the Subordination Agent, and the Controlling Party may appoint a
successor Subordination Agent. The Controlling Party shall remove the
Subordination Agent if:
(1) the Subordination Agent fails to comply with Section
-------
6.9;
---
(2) the Subordination Agent is adjudged bankrupt or
insolvent;
(3) a receiver or other public officer takes charge of the
Subordination Agent or its property; or
48
[2001-1 Intercreditor Agreement]
(4) the Subordination Agent otherwise becomes incapable of
acting.
If the Subordination Agent resigns or is removed or if a vacancy exists in
the office of Subordination Agent for any reason (the Subordination Agent in
such event being referred to herein as the retiring Subordination Agent), the
Controlling Party shall promptly appoint a successor Subordination Agent.
A successor Subordination Agent shall deliver (x) a written acceptance of
its appointment as Subordination Agent hereunder to the retiring Subordination
Agent and (y) a written assumption of its obligations hereunder and under each
Liquidity Facility to each party hereto, upon which the resignation or removal
of the retiring Subordination Agent shall become effective, and the successor
Subordination Agent shall have all the rights, powers and duties of the
Subordination Agent under this Agreement. The successor Subordination Agent
shall mail a notice of its succession to the Liquidity Providers and the
Trustees. The retiring Subordination Agent shall promptly transfer its rights
under each of the Liquidity Facilities and all of the property held by it as
Subordination Agent to the successor Subordination Agent.
If a successor Subordination Agent does not take office within 60 days
after the retiring Subordination Agent resigns or is removed, the retiring
Subordination Agent or one or more of the Trustees may petition any court of
competent jurisdiction for the appointment of a successor Subordination Agent.
If the Subordination Agent fails to comply with Section 6.9 (to the extent
-----------
applicable), one or more of the Trustees or one or more of the Liquidity
Providers may petition any court of competent jurisdiction for the removal of
the Subordination Agent and the appointment of a successor Subordination Agent.
Notwithstanding the foregoing, no resignation or removal of the
Subordination Agent shall be effective unless and until a successor has been
appointed. No appointment of a successor Subordination Agent shall be effective
unless and until the Rating Agencies shall have delivered a Ratings
Confirmation.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS
9.1 Amendments, Waivers, etc. (a) This Agreement may not be
-------------------------
supplemented, amended or modified without the consent of the Trustee (acting
except in the case of any amendment pursuant to Section 3.6(e) hereof with
--------------
respect to any Replacement Liquidity Facility or any amendment contemplated by
the last sentence of this Section 9.1(a) with the consent of holders of
--------------
Certificates of each Class evidencing interests in the related Trust aggregating
not less than a majority in interest in such Trust or as otherwise authorized
pursuant to the relevant Trust Agreements), the Subordination Agent and each
Liquidity Provider; provided, however, that this Agreement may be supplemented,
-------- -------
amended or modified without the consent of any Trustee and any Liquidity
Provider if such supplement, modification or amendment cures an ambiguity or
inconsistency or does not materially adversely affect such Trustee, the
Liquidity Providers or the
49
[2001-1 Intercreditor Agreement]
holders of the related Class of Certificates; provided, further, however, that
-------- ------- -------
if such supplement, amendment or modification would (x) directly or indirectly
modify or supersede, or otherwise conflict with, Section 2.2(b), Section 3.6(f)
-------------- --------------
or the second sentence of Section 10.6 (collectively, together with this
------------
proviso, the "United Provisions") or (y) otherwise adversely affect the
interests of a potential Replacement Liquidity Provider or of United with
respect to its payment obligations under any Indenture, then such supplement,
amendment or modification shall not be effective without the additional written
consent of United. Notwithstanding the foregoing, without the consent of each
Certificateholder and each Liquidity Provider, no supplement, amendment or
modification of this Agreement may (i) reduce the percentage of the interest in
any Trust or Trusts of the same Class evidenced by the Certificates issued by
such Trust or Trusts necessary to consent to modify or amend any provision of
this Agreement or to waive compliance therewith or (ii) modify Section 2.4, 3.2,
----------- ---
3.3 or 3.6(f) relating to the distribution of monies received by the
--- ------
Subordination Agent hereunder from the Notes or pursuant to the Liquidity
Facilities. Nothing contained in this Section 9.1 shall require the consent of
-----------
the Trustee with respect to a Class of Certificates at any time following the
payment of Final Distributions with respect to such Class of Certificates.
If the Replacement Liquidity Facility for any Liquidity Facility in
accordance with Section 3.6(e) hereof is to be comprised of more than one
--------------
instrument as contemplated by the definition of the term "Replacement Liquidity
Facility", then each of the parties hereto agrees to amend this Agreement to
incorporate appropriate mechanics for multiple Liquidity Facilities for an
individual Trust.
(b) If the Subordination Agent, as the registered holder of any
Notes, receives a request for its consent to any amendment, modification or
waiver under or with respect to any such Notes, the Indenture pursuant to which
such Notes were issued or if applicable, any Participation Agreement or other
related document, (i) if no Indenture Default shall have occurred and be
continuing, the Subordination Agent shall request instructions from the Trustee
which holds the relevant Notes and the consent of each Liquidity Provider (which
consent shall not be unreasonably withheld or delayed) and shall vote or consent
in accordance with the vote of each such Trustee and the instructions of the
Liquidity Providers and (ii) if any Indenture Default shall have occurred and be
continuing with respect to such Indenture, the Subordination Agent will exercise
its voting rights as directed by the Controlling Party, subject to Section 4.1;
-----------
provided, however, that no amendment of or supplement to any Indenture,
-------- -------
Participation Agreement or other related document or waiver or modification of
the terms of, or consent under, any thereof, shall without the consent of each
Liquidity Provider, have any of the effects listed in the proviso of Section
11.02(a) of any Indenture.
9.2 Subordination Agent Protected. If, in the reasonable opinion of the
-----------------------------
institution acting as the Subordination Agent hereunder, any document required
to be executed pursuant to the terms of Section 9.1 affects any right, duty,
-----------
immunity or indemnity with respect to it under this Agreement or any Liquidity
Facility, the Subordination Agent may in its discretion decline to execute such
document.
9.3 Effect of Supplemental Agreements. Upon the execution of any
---------------------------------
amendment or supplement hereto pursuant to the provisions hereof, this Agreement
shall be and be deemed to be and shall be modified and amended in accordance
therewith and the respective rights,
50
[2001-1 Intercreditor Agreement]
limitations of rights, obligations, duties and immunities under this Agreement
of the parties hereto and beneficiaries hereof shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental
agreement shall be and be deemed to be and shall be part of the terms and
conditions of this Agreement for any and all purposes. In executing or accepting
any supplemental agreement permitted by this Article IX, the Subordination Agent
----------
shall be entitled to receive, and shall be fully protected in relying upon, an
opinion of counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Article IX.
----------
9.4 Copy to Rating Agencies. Promptly following its receipt of each
-----------------------
amendment, consent, modification, supplement or waiver contemplated by this
Article IX, the Subordination Agent shall send a copy thereof to each Rating
----------
Agency.
ARTICLE X
MISCELLANEOUS
10.1 Termination of Intercreditor Agreement. Following payment of Final
--------------------------------------
Distributions with respect to each Class of Certificates and the payment in full
of all Liquidity Obligations to the Liquidity Providers and so long as (i) there
shall then be no other amounts due to the Certificateholders, the Trustee, the
Liquidity Providers and the Subordination Agent hereunder or under the Trust
Agreements and (ii) the commitment of the Liquidity Providers under the
Liquidity Facilities shall have expired or been terminated, this Agreement and
the trusts created hereby shall terminate and this Agreement shall be of no
further force or effect. Except as aforesaid or otherwise provided, this
Agreement and the trusts created hereby shall continue in full force and effect
in accordance with the terms hereof.
10.2 Intercreditor Agreement for Benefit of Trustee, Liquidity Providers
-------------------------------------------------------------------
and Subordination Agent. Nothing in this Agreement, whether express or implied,
-----------------------
shall be construed to give to any Person other than the Trustee, the Liquidity
Providers and the Subordination Agent (and United, in the case of Section 9.1)
-----------
any legal or equitable right, remedy or claim under or in respect of this
Agreement.
10.3 Notices. Unless otherwise expressly specified or permitted by the
-------
terms hereof, all notices, requests, demands, authorizations, directions,
consents, waivers or documents provided or permitted by this Agreement to be
made, given, furnished or filed shall be in writing, mailed by certified mail,
postage prepaid, or by confirmed telecopy and
(i) if to the Subordination Agent, addressed to it at its office
at:
State Street Bank and Trust Company of Connecticut,
National Association
000 Xxxxxx Xxxxxx
Xxxxxxx Square
Hartford, Connecticut 06103
Attention: Corporate Trust Division
51
[2001-1 Intercreditor Agreement]
Telephone: 000-000-0000
Telecopy: 000-000-0000
(ii) if to the Trustee, addressed to it at its office at:
State Street Bank and Trust Company of Connecticut,
National Association
000 Xxxxxx Xxxxxx
Xxxxxxx Square
Hartford, Connecticut 06103
Attention: Corporate Trust Division
Telephone: 000-000-0000
Telecopy: 000-000-0000
(iii) if to the Liquidity Provider, addressed to it at its office
at:
Westdeutsche Landesbank Girozentrale,
acting through its New York branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Business/Credit Contact
-----------------------
Attention: Transportation Finance
Global Structured Finance/Americas
Telecopy: 000-000-0000
Operations Contact
------------------
Attention: Xxxxxx Xxxxx
Loan Administration
Telecopy: 000-000-0000
Whenever any notice in writing is required to be given by the Trustee or any
Liquidity Provider or the Subordination Agent to any of the other of them, such
notice shall be deemed given and such requirement satisfied when such notice is
received, if such notice is mailed by certified mail, postage prepaid or by
courier service or is sent by confirmed telecopy addressed as provided above.
Any party hereto may change the address to which notices to such party will be
sent by giving notice of such change to the other parties to this Agreement.
10.4 Severability. Any provision of this Agreement which is prohibited or
------------
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.5 No Oral Modifications or Continuing Waivers. No terms or provisions
-------------------------------------------
of this Agreement may be changed, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party or other Person against
whom enforcement of the change, waiver, discharge or termination is sought and
any other party or other Person whose consent is required
52
[2001-1 Intercreditor Agreement]
pursuant to this Agreement and any waiver of the terms hereof shall be effective
only in the specific instance and for the specific purpose given.
10.6 Successors and Assigns. All covenants and agreements contained
----------------------
herein shall be binding upon, and inure to the benefit of, each of the parties
hereto and the successors and assigns of each, all as herein provided. The
agreements contained in Section 9.1 shall inure to the benefit of United and its
-----------
successors and assigns.
10.7 Headings. The headings of the various Articles and Sections herein
--------
and in the table of contents hereto are for convenience of reference only and
shall not define or limit any of the terms or provisions hereof.
10.8 Counterpart Form. This Agreement may be executed by the parties
----------------
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same agreement.
10.9 Subordination. (a) As between the Liquidity Providers, on the one
-------------
hand, and the Trustees and the Certificateholders, on the other hand, and as
among the Trustees and the related Certificateholders, this Agreement shall be a
subordination agreement for purposes of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx
Bankruptcy Code, as amended from time to time.
(b) Notwithstanding the provisions of this Agreement, if prior to
the payment in full to the Liquidity Providers of all Liquidity Obligations then
due and payable, any party hereto shall have received any payment or
distribution in respect of Notes or any other amount under the Indentures or
other Operative Agreements which, had the subordination provisions of this
Agreement been properly applied to such payment, distribution or other amount,
would not have been distributed to such Person, then such payment, distribution
or other amount shall be received and held in trust by such Person and paid over
or delivered to the Subordination Agent for application as provided herein.
(c) If any Trustee, any Liquidity Provider or the Subordination
Agent receives any payment in respect of any obligations owing hereunder (or, in
the case of the Liquidity Providers, in respect of the Liquidity Obligations),
which is subsequently invalidated, declared preferential, set aside and/or
required to be repaid to a trustee, receiver or other party, then, to the extent
of such payment, such obligations (or, in the case of the Liquidity Providers,
such Liquidity Obligations) intended to be satisfied shall be revived and
continue in full force and effect as if such payment had not been received.
(d) The Trustees (on behalf of themselves and the holders of
Certificates), the Liquidity Providers and the Subordination Agent confirm that
the payment priorities specified in Sections 2.4, 3.2 and 3.3 shall apply in all
------------ --- ---
circumstances, notwithstanding the fact that the obligations owed to the
Trustees and the holders of Certificates are secured by certain assets and the
Liquidity Obligations are not so secured. Each Trustee expressly agrees (on
behalf of itself and the holders of Certificates) not to assert priority over
the holders of Liquidity Obligations due to their status as secured creditors in
any bankruptcy, insolvency or other legal proceeding.
53
[2001-1 Intercreditor Agreement]
(e) Each of the Trustees (on behalf of itself and the holders of
Certificates), the Liquidity Providers and the Subordination Agent may take any
of the following actions without impairing its rights under this Agreement:
(i) obtain a Lien on any property to secure any amounts owing
to it hereunder, including, in the case of the Liquidity Providers, the
Liquidity Obligations,
(ii) obtain the primary or secondary obligation of any other
obligor with respect to any amounts owing to it hereunder, including, in
the case of the Liquidity Providers, any of the Liquidity Obligations,
(iii) renew, extend, increase, alter or exchange any amounts
owing to it hereunder, including, in the case of the Liquidity Providers,
any of the Liquidity Obligations, or release or compromise any obligation
of any obligor with respect thereto,
(iv) refrain from exercising any right or remedy, or delay in
exercising such right or remedy, which it may have, or
(v) take any other action which might discharge a subordinated
party or a surety under applicable law;
provided, however, that the taking of any such actions by any of the Trustee,
-------- -------
the Liquidity Providers or the Subordination Agent shall not prejudice the
rights or adversely affect the obligations of any other party under this
Agreement.
10.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
-------------
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW)), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
10.11 Submission to Jurisdiction; Waiver of Jury Trial; Waiver of
-----------------------------------------------------------
Indemnity.
---------
(a) Each of the parties hereto herby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Operative Agreement, or
for recognition and enforcement of any judgment in respect hereof or
thereof, to the non-exclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the
Southern District of New York, and the appellate courts from any thereof;
(ii) consents that any such action or proceeding may be brought
in such courts, and waives any objection that it may now or hereafter have
to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and agrees
not to plead or claim the same;
54
[2001-1 Intercreditor Agreement]
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to each party hereto at its address set forth in Section 10.3, or
------------
at such other address of which the other person shall have been notified
pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to xxx in any other jurisdiction.
(b) EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF
THIS AGREEMENT AND THE RELATIONSHIP THAT IS BEING ESTABLISHED, including
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each of the parties warrants and represents that it has
reviewed this waiver with its legal counsel, and that it knowingly and
voluntarily waives its jury trial rights following consultation with such legal
counsel. THIS WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
(c) Each Liquidity Provider hereby waives any immunity it may have
from the jurisdiction of the courts of the United States or of any state thereof
and waives any immunity any of its properties located in the United States may
have from attachment or execution upon a judgment entered by any such court
under the United States Foreign Sovereign Immunities Act of 1976 or any similar
successor legislation.
55
[2001-1 Intercreditor Agreement]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written, and acknowledge that this Agreement has been
made and delivered in the City of Chicago, and this Agreement has become
effective only upon such execution and delivery.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
not in its individual capacity but
solely as Trustee for each of the Trusts
By: /s/ Xxxx X. Xxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Assistant Vice President
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
ACTING THROUGH ITS NEW YORK BRANCH
as Class A-1 Liquidity Provider,
Class A-2 Liquidity Provider,
Class A-3 Liquidity Provider,
Class B Liquidity Provider and
Class C Liquidity Provider
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Managing Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxx
Title: Associate Director
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
not in its individual capacity except as
expressly set forth herein but solely as
Subordination Agent
By: /s/ Xxxx X. Xxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Assistant Vice President
56
[2001-1 Intercreditor Agreement]
SCHEDULE 1
INDENTURES
1. Trust Indenture and Mortgage (2001-1 A319-1) between United Air Lines,
Inc. (the "Owner") and State Street Bank and Trust Company of Connecticut,
National Association, in its individual capacity and as Indenture Trustee.
2. Trust Indenture and Mortgage (2001-1 A319-2) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
3. Trust Indenture and Mortgage (2001-1 A319-3) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
4. Trust Indenture and Mortgage (2001-1 A319-4) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
5. Trust Indenture and Mortgage (2001-1 A319-5) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
6. Trust Indenture and Mortgage (2001-1 A319-6) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
7. Trust Indenture and Mortgage (2001-1 A319-7) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
8. Trust Indenture and Mortgage (2001-1 A319-8) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
9. Trust Indenture and Mortgage (2001-1 A319-9) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
10. Trust Indenture and Mortgage (2001-1 A319-10) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
SCHEDULE 1
Page 1
[2001-1 Intercreditor Agreement]
11. Trust Indenture and Mortgage (2001-1 A320-1) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
12. Trust Indenture and Mortgage (2001-1 A320-2) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
13. Trust Indenture and Mortgage (2001-1 A320-3) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
14. Trust Indenture and Mortgage (2001-1 A320-4) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
15. Trust Indenture and Mortgage (2001-1 A320-5) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
16. Trust Indenture and Mortgage (2001-1 A320-6) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
17. Trust Indenture and Mortgage (2001-1 747-1) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
18. Trust Indenture and Mortgage (2001-1 747-2) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
19. Trust Indenture and Mortgage (2001-1 747-3) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
20. Trust Indenture and Mortgage (2001-1 747-4) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
21. Trust Indenture and Mortgage (2001-1 747-5) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
22. Trust Indenture and Mortgage (2001-1 767-1) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
SCHEDULE 1
Page 2
[2001-1 Intercreditor Agreement]
23. Trust Indenture and Mortgage (2001-1 767-2) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
24. Trust Indenture and Mortgage (2001-1 767-3) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
25. Trust Indenture and Mortgage (2001-1 767-4) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
26. Trust Indenture and Mortgage (2001-1 767-5) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
27. Trust Indenture and Mortgage (2001-1 777-1) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
28. Trust Indenture and Mortgage (2001-1 777-2) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
29. Trust Indenture and Mortgage (2001-1 777-3) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
30. Trust Indenture and Mortgage (2001-1 777-4) between Owner and State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity and as Indenture Trustee.
SCHEDULE 1
Page 3
