King & Spalding
Draft: 2/28/96
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TRUST AGREEMENT
DELTA 1994-1
dated as of
April 1, 1994
Amended and Restated
as of March 1, 1996
BETWEEN
____________________________,
as Owner Participant
AND
WILMINGTON TRUST COMPANY,
as Owner Trustee
________________
DELTA AIR LINES, INC.
ONE XxXXXXXXX XXXXXXX MD-11 AIRCRAFT
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INDEX TO TRUST AGREEMENT
PAGE
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ARTICLE I. DEFINITIONS...................................................1
Section 1.01 Special Definitions ............................1
Section 1.02 Reference to Lease or
Participation Agreement ......................3
ARTICLE 2. AUTHORITY; DECLARATION OF TRUST BY
OWNER TRUSTEE ................................................4
Section 2.01 Authorization...................................4
Section 2.02 Declaration of Trust............................4
ARTICLE 3. PAYMENTS TO OWNER PARTICIPANT ................................5
Section 3.01 Payments From Trust
Estate Only...................................5
Section 3.02 Method of Payment...............................5
ARTICLE 4. EXECUTION OF DOCUMENTS; ISSUANCE OF
CERTIFICATES ................................................5
Section 4.01 Authorization...................................5
Section 4.02 Conditions......................................6
ARTICLE 5. RECEIPT, DISTRIBUTION AND APPLICATION
OF INCOME FROM THE TRUST ESTATE...............................6
Section 5.01 Cross Reference to
Indenture.....................................6
ARTICLE 6. DUTIES OF THE OWNER TRUSTEE...................................7
Section 6.01 Notice of Event of Default
or Indenture Event of
Default.......................................7
Section 6.02 Action Upon Instructions........................7
Section 6.03 Indemnification.................................8
Section 6.04 No Duties Except as
Specified in Trust
Agreement or
Instructions..................................8
Section 6.05 No Action Except Under
Lease, Trust Agreement
or Instructions...............................8
Section 6.06 Preparation of Tax Returns......................9
Section 6.07 Satisfaction of Conditions
Precedent.....................................9
Section 6.08 Fixed Investment Trust..........................9
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ARTICLE 7. THE OWNER TRUSTEE.............................................9
Section 7.01 Acceptance of Trusts
and Duties....................................9
Section 7.02 Absence of Duties..............................10
Section 7.03 No Representations or
Warranties as to
Aircraft or Documents........................11
Section 7.04 No Segregation of Monies;
No Interest..................................12
Section 7.05 Reliance; Agent;
Advice of Counsel............................12
Section 7.06 Not Acting in Individual
Capacity.....................................12
Section 7.07 Compensation...................................13
ARTICLE 8. INDEMNIFICATION OF WTC BY OWNER
PARTICIPANT ...............................................13
Section 8.01 Owner Participant to
Indemnify WTC................................13
ARTICLE 9. TRANSFER OF OWNER PARTICIPANT'S
INTERESTS....................................................14
Section 9.01 Conditions.....................................14
Section 9.02 Notice.........................................17
ARTICLE 10. SUCCESSOR OWNER TRUSTEES; APPOINTMENT OF
SEPARATE TRUSTEES............................................18
Section 10.01 Resignation of Owner
Trustee; Appointment
of Successor................................18
Section 10.02 Appointment of Separate
Trustees....................................19
ARTICLE 11. SUPPLEMENTS AND AMENDMENTS TO THIS
TRUST AGREEMENT AND OTHER DOCUMENTS..........................21
Section 11.01 Instructions of Owner
Participant;
Limitations.................................21
Section 11.02 Owner Trustee
Protected...................................22
Section 11.03 Request of Substance,
Not Form ...................................22
ARTICLE 12. MISCELLANEOUS ...............................................22
Section 12.01 Termination of Trust
Agreement...................................22
Section 12.02 No Legal Title to Trust
Estate in Owner
Participant.................................23
Section 12.03 Sale of Aircraft by Owner
Trustee Is Binding..........................23
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Section 12.04 Trust Agreement for
Benefit of Owner
Trustee, the Indenture
Trustee and Owner
Participant Only............................24
Section 12.05 Notices.......................................24
Section 12.06 Severability..................................24
Section 12.07 Limitation on Owner
Participant's
Liability ..................................24
Section 12.08 Separate Counterparts.........................25
Section 12.09 Successors and Assigns........................25
Section 12.10 Headings......................................25
Section 12.11 Governing Law.................................25
Section 12.12 Authorization to Owner
Trustee for Indenture.......................25
Section 12.13 Waivers, etc..................................25
Section 12.14 Performance by Owner
Participant.................................25
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TRUST AGREEMENT
(DELTA 1994-1)
This TRUST AGREEMENT (DELTA 1994-1), dated as of April 1, 1994, as amended
and restated as of March 1, 1996, between the Owner Participant, as such term is
defined in Section 1.01 hereof, and Wilmington Trust Company, a Delaware banking
corporation (in its individual capacity, referred to as "WTC", and not in its
individual capacity but solely as Owner Trustee hereunder, referred to as the
"Owner Trustee"):
W I T N E S S E T H :
WHEREAS, capitalized terms used but not otherwise defined herein shall have
the respective meanings set forth or referred to in Article I hereof;
WHEREAS, the Owner Participant and the Owner Trustee have heretofore
entered into that certain Trust Agreement (Delta 1994-1) dated as of April 1,
1994 (the "Original Trust Agreement");
WHEREAS, the Original Trust Agreement has been duly filed with the Federal
Aviation Administration on April 12, 1994;
WHEREAS, the Interim Refinancing Loan Participant participated in the
payment of Lessor's Cost by providing an interim loan as evidenced by the
Interim Refinancing Loan Certificate issued to it;
WHEREAS, pursuant to Section 20 of the Original Participation Agreement,
the Lessee, the Owner Participant and the Owner Trustee desire that the Interim
Refinancing Loan Certificate be prepaid with the proceeds from the Certificates
to be issued pursuant to the Indenture; and
WHEREAS, the Lessee, the Owner Participant and the Owner Trustee desire
that the Owner Participant and WTC amend and restate the Original Trust
Agreement in its entirety as provided herein.
ARTICLE 1.
DEFINITIONS
SECTION 1.01 Special Definitions. For all purposes of this Trust Agreement
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the following terms have the following meanings (such definitions to be equally
applicable to both the singular and plural forms of the terms herein defined):
"Certificates" has the meaning specified in the Indenture.
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"Commitment" has the meaning specified in the Original Participation
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Agreement.
"Excepted Payments" has the meaning specified in the Indenture.
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"Holder" has the meaning specified in the Indenture.
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"Indenture" means that certain Trust Indenture and Security Agreement
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(Delta 1994-1), dated as of April 1, 1994, as amended and restated as of
March 1, 1996, between the Owner Trustee (not in its individual capacity
except as expressly provided therein but solely as Owner Trustee) and the
Indenture Trustee (not in its individual capacity except as expressly
provided therein but solely as Indenture Trustee), as supplemented or
amended from time to time, as therein provided, including as supplemented
by each Trust Agreement and Trust Indenture Supplement.
"Indenture Estate" has the meaning specified in the Indenture.
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"Indenture Event of Default" has the meaning specified in the
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Indenture.
"Indenture Trustee" means The Bank of New York, a New York banking
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corporation, not in its individual capacity, except as otherwise provided
in the Indenture, but solely in its capacity as indenture trustee under the
Indenture, and its successors and assigns as trustee thereunder.
"Lease" means that certain Lease Agreement (Delta 1994-1), dated as of
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April 1, 1994, as amended and restated as of March 1, 1996, between the
Owner Trustee (as Owner Trustee hereunder) and the Lessee, as said Lease
Agreement may from time to time be supplemented or amended, or the terms
thereof waived or modified, to the extent permitted by and in accordance
with its terms, the terms of the Indenture, the terms of the Participation
Agreement and the terms of this Trust Agreement. The term "Lease" also
includes the Lease Supplement (Delta 1994-1) dated the Delivery Date
entered into pursuant to the terms of the Original Lease.
"Owner Participant" means ____________________________ so long as it
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shall not have assigned all its interest under this Trust Agreement, and
each other person which may from time to time become a party to this Trust
Agreement as Owner Participant pursuant to the terms of Article 9 hereof
and Section 16 of the Participation Agreement.
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"Trust Agreement" or "this Trust Agreement" means this Trust Agreement
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(Xxxxx 0000-0) dated as of April 1, 1994, as amended and restated as of
March 1, 1996, as supplemented or amended from time to time, as herein
provided, including as supplemented by the Trust Agreement Supplement.
"Trust Agreement and Trust Indenture Supplement" or "Trust Agreement
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Supplement" means the Trust Agreement and Trust Indenture Supplement (Delta
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1994-1) dated April 12, 1994, as such Trust Agreement and Trust Indenture
Supplement shall be amended and supplemented from time to time and any
other supplement to the Trust Agreement and Indenture, substantially in the
form of Exhibit A to the Original Indenture, which should particularly
describe any Replacement Airframe or Replacement Engine included in the
Trust Estate and the Indenture Estate.
"Trust Estate" means all estate, right, title and interest of the
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Owner Trustee in and to the Aircraft, the Original Documents, the Lease,
any Lease Supplement, the Purchase Agreement, the Participation Agreement,
the Purchase Agreement Assignment, the Manufacturer's warranty bills of
sale referred to in Section 2 of the Purchase Agreement Assignment, the
Seller's xxxx of sale with respect to the Aircraft, the Consent and
Agreement, the Engine Consent and Agreement and the Bills of Sale,
including, without limitation, all amounts of Basic Rent and Supplemental
Rent, insurance proceeds (other than liability insurance proceeds payable
to or for the benefit of WTC, the Owner Participant, the Holders or the
Indenture Trustee) and requisition, indemnity or other payments of any kind
for or with respect to the Aircraft (except amounts owing to the Owner
Participant, to the Indenture Trustee or to WTC pursuant to Section 6(b),
6(c) or 14 of the Participation Agreement). Notwithstanding the foregoing,
"Trust Estate" does not include any Excepted Payments.
SECTION 1.02 Reference to Lease or Participation Agreement. For all
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purposes of this Trust Agreement the following terms have the meanings specified
in the Lease (or the Participation Agreement with respect to the terms "Bills
of Sale", "Closing Date", "Seller" and "Tax"), except that the term "Owner
Trustee" is to be substituted for the term "Lessor" in any such definition:
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"Act" "Interim Refinancing Loan
"Affiliate" Participant"
"Aircraft" "Lease Supplement"
"Airframe" "Lessee"
"Basic Rent" "Lessor's Cost"
"Basic Term" "Lien"
"Bills of Sale" "Manufacturer"
"Business Day" "Operative Documents"
"Certificates" "Original Documents"
"Citizen of the "Original Indenture"
United States" "Original Participation Agreement"
"Consent and Agreement" "Participation Agreement"
"Delivery Date" "Purchase Agreement"
"Engine" "Purchase Agreement Assignment"
"Engine Consent "Refunding Date"
and Agreement" "Renewal Term"
"Event of Default" "Responsible Officer"
"Event of Loss" "Stipulated Loss Value"
"FAA" "Supplemental Rent"
"Indemnity Agreement" "Tax" or "Taxes"
"Interim Refinancing Loan "Termination Value"
Certificate"
ARTICLE 2.
AUTHORITY; DECLARATION OF
TRUST BY OWNER TRUSTEE
SECTION 2.01 Authorization. The Owner Participant hereby authorizes and
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directs the Owner Trustee, and the Owner Trustee, as Owner Trustee hereunder,
hereby agrees, (i) to execute and deliver this Trust Agreement, the
Participation Agreement, the Indenture, the Certificates, the Lease, the other
Operative Documents to which it is a party and all other documents (including
UCC financing statements and amendments) to which the Owner Trustee is a party
(in the respective forms in which they are delivered from time to time by the
Owner Participant to the Owner Trustee) necessary or desirable in order to
consummate the transactions contemplated hereby and thereby, and (ii) subject to
the terms of this Trust Agreement, to exercise the rights and perform the duties
of the Lessor under the Lease and its duties under the Participation Agreement
and the Indenture as set forth therein.
SECTION 2.02 Declaration of Trust. WTC hereby declares that it holds and
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will continue to hold the Trust Estate as Owner Trustee upon the trusts
hereinafter set forth for the use and benefit of the Owner Participant, subject,
however, to the provisions of and the Lien created by the Indenture.
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ARTICLE 3.
PAYMENTS TO OWNER PARTICIPANT
SECTION 3.01 Payments From Trust Estate Only. Except as provided in
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Section 7.01 hereof, all payments to be made by the Owner Trustee under this
Trust Agreement shall be made only from the income and the proceeds from the
Trust Estate and only to the extent that the Owner Trustee shall have received
sufficient income or proceeds from the Trust Estate to make such payments. The
Owner Participant agrees that it will look solely to the income and proceeds
from the Trust Estate to the extent available for distribution to the Owner
Participant as herein provided and, except as provided in Section 7.01 hereof,
that WTC is neither personally liable to the Owner Participant for any amounts
payable under this Trust Agreement nor, except as provided in Section 7.01
hereof, subject to any liability under this Trust Agreement.
SECTION 3.02 Method of Payment. All amounts payable to the Owner
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Participant pursuant to this Trust Agreement shall be payable at the Corporate
Trust Administration office of the Owner Trustee in Wilmington, Delaware, or at
the corporate trust office of any successor owner trustee in the United States
of America, in immediately available funds. Notwithstanding the foregoing, the
Owner Trustee will pay all amounts payable by the Owner Trustee hereunder to the
Owner Participant (including all amounts distributed pursuant to Article 5 of
this Trust Agreement) on the day received (or on the next succeeding Business
Day if the funds to be so distributed shall not have been received by the Owner
Trustee prior to 12:00 Noon E.S.T. or E.D.T., as the case may be, and which
funds the Owner Trustee shall not have been reasonably able to distribute to the
Owner Participant on the day received) as provided in Schedule A to the
Participation Agreement or in such other manner as the Owner Participant may,
from time to time, direct in writing, provided, however, that, except as
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otherwise instructed in writing by the Owner Participant, the Owner Trustee
shall invest overnight in investments permitted under Section 24 of the Lease
all funds received by it at or later than 12:00 Noon E.S.T. or E.D.T., as the
case may be, and which funds the Owner Trustee shall not have been reasonably
able to distribute to the Owner Participant on the day received.
ARTICLE 4.
EXECUTION OF DOCUMENTS;
ISSUANCE OF CERTIFICATES
SECTION 4.01 Authorization. The Owner Participant hereby authorizes and
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directs the Owner Trustee to, and the Owner Trustee agrees for the benefit of
the Owner Participant that on the Refunding Date it will, as Owner Trustee
hereunder, subject to due compliance with the terms of Section 4.02 of this
Trust Agreement:
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(a) execute and deliver the Lease, the Indenture, the Participation
Agreement and all other such instruments, documents or certificates and
take all such other actions in accordance with the direction of the Owner
Participant as the Owner Participant may deem necessary or advisable in
connection with the transactions contemplated by the Participation
Agreement; and
(b) issue and deliver to the Indenture Trustee for authentication and
further delivery to each Holder the Certificate or Certificates to be
issued to it, in the amounts and otherwise as provided in Sections 2.04,
2.06, 2.07, 2.09 and 2.11 of the Indenture; the taking of any such action
by the Owner Trustee in the presence of the Owner Participant or its
counsel shall evidence, conclusively, the direction of the Owner
Participant.
SECTION 4.02 Conditions. The right and obligation of the Owner Trustee to
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take the action required by Section 4.01 hereof with respect to the Aircraft and
the Certificates shall be subject to the conditions precedent that the terms and
conditions of Section 3 of the Participation Agreement shall have been complied
with in a manner satisfactory to the Owner Trustee and to the Owner Participant
(or waived thereby), and the Owner Participant (acting directly or through
special counsel) shall have so notified the Owner Trustee.
ARTICLE 5.
RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME
FROM THE TRUST ESTATE
SECTION 5.01 Cross Reference to Indenture. Until the Indenture shall have
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been terminated pursuant to Section 14.01 thereof or until the Aircraft shall
have been released from the lien created under the Indenture pursuant to the
terms thereof (i) any payment distributed to the Owner Trustee pursuant to
clause "second" of Section 5.01 of the Indenture shall be paid to the Owner
Participant by the Indenture Trustee by wire transfer of such funds to the
account of the Owner Participant set forth in Schedule A to the Participation
Agreement and (ii) any other payment received by the Owner Trustee, as Owner
Trustee hereunder, shall be applied as provided in Article V of the Indenture.
Excepted Payments received by the Owner Trustee, as Owner Trustee hereunder, for
the Owner Participant shall be paid to the Owner Participant as provided in
Schedule A to the Participation Agreement or as otherwise directed by the Owner
Participant in writing. Excepted Payments payable to WTC shall be retained by
WTC. After the Indenture shall have been terminated pursuant to Section 14.01
thereof, any payment (other than Excepted Payments) received by the Owner
Trustee, as Owner Trustee hereunder, any payments received from the Indenture
Trustee and any other amount received for the application or distribution of
which no provision
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is made herein, shall be distributed forthwith upon receipt by the Owner Trustee
in the following order of priority: first, so much of such payment as shall be
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required to reimburse the Owner Trustee for any expenses not otherwise
reimbursed as to which the Owner Trustee is entitled to be so reimbursed
pursuant to the provisions hereof, or indemnified from the Trust Estate pursuant
to the penultimate sentence of Section 8.01 hereof, shall be retained by the
Owner Trustee; and second, the balance, if any, shall be paid to the Owner
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Participant as provided in Schedule A to the Participation Agreement or as
otherwise directed by the Owner Participant in writing.
ARTICLE 6.
DUTIES OF THE OWNER TRUSTEE
SECTION 6.01 Notice of Event of Default or Indenture Event of Default. In
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the event the Owner Trustee shall have knowledge of an Indenture Event of
Default or an Event of Default or an event or condition which after notice or
lapse of time or both would become an Indenture Event of Default or an Event of
Default, the Owner Trustee shall give written notice, upon first knowledge
thereof and in no event later than five Business Days after the Owner Trustee
shall have such knowledge of such Event of Default or Indenture Event of Default
or such event or condition to the Owner Participant, Lessee and the Indenture
Trustee by telegram, telex or other written telecommunication or by telephone
followed by prompt written notice thereof by first-class registered or certified
mail, postage prepaid, provided that in the case of an event which with the
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passage of time would constitute an Indenture Event of Default referred to in
paragraph (c) or (e) of Section 7.01 of the Indenture relating to the Owner
Trustee, such notice shall in no event be furnished later than ten days after
the Owner Trustee shall first have knowledge of such event. Subject to the terms
of Section 6.03 hereof, the Owner Trustee shall take such action or refrain from
taking such action with respect to such Event of Default or Indenture Event of
Default or such event or condition, not inconsistent with the provisions of the
Indenture, as the Owner Trustee shall be instructed in writing by the Owner
Participant. For all purposes of this Trust Agreement, in the absence of actual
knowledge of an officer of the Owner Trustee in its Corporate Trust
Administration Department, the Owner Trustee shall not be deemed to have
knowledge of an Event of Default or an Indenture Event of Default or of any
event or condition which after notice or lapse of time or both would become an
Event of Default or an Indenture Event of Default, unless notified in writing in
the manner and at the address specified in Section 12.05 hereof by the Owner
Participant, the Indenture Trustee or Lessee.
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SECTION 6.02 Action Upon Instructions. Subject to the terms of Sections
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6.01 and 6.03 hereof, upon the written instructions at any time and from time to
time of the Owner Participant, the Owner Trustee shall take or refrain from
taking such action, not inconsistent with provisions of the Indenture, as may be
specified in such instructions.
SECTION 6.03 Indemnification. The Owner Trustee shall not be required to
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take any action or refrain from taking any action under Section 6.01 or 6.02
hereof (other than as specified in the second and fourth sentences of Section
5.01 hereof and the first sentence of Section 6.01) unless the Owner Trustee
shall have been indemnified by Lessee or the Owner Participant, in manner and
form and to the extent reasonably satisfactory to the Owner Trustee, against any
liability, cost or expense (including reasonable legal fees and expenses) which
may be incurred in connection therewith, provided that the written undertaking
of indemnification by the Owner Participant shall be satisfactory to the Owner
Trustee. The Owner Trustee shall not be required to take any action under
Section 6.01 or 6.02 hereof (other than as specified in the second and fourth
sentences of Section 5.01 hereof and the first sentence of Section 6.01 hereof),
nor shall any other provision of this Trust Agreement be deemed to impose a duty
on the Owner Trustee to take any action, if the Owner Trustee shall have been
advised by counsel that such action is contrary to the terms hereof or of the
Lease or the Indenture or is contrary to law and the Owner Trustee has delivered
to the Owner Participant written notice of the basis of its refusal to act.
SECTION 6.04 No Duties Except as Specified in Trust Agreement or
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Instructions. The Owner Trustee shall not have any duty or obligation to manage,
------------
control, use, sell, dispose of or otherwise deal with the Aircraft or any other
part of the Trust Estate, or otherwise to take or to refrain from taking any
action under, or in connection with, the Lease except as expressly provided by
the terms of the Lease, the Indenture, this Trust Agreement, the Purchase
Agreement Assignment or as expressly provided in written instructions from the
Owner Participant received pursuant to the terms of Section 6.01 or 6.02 hereof;
and no implied duties or obligations shall be read into this Trust Agreement
against the Owner Trustee. WTC nevertheless agrees that, upon a Responsible
Officer of the Owner Trustee obtaining actual knowledge thereof, it will, at its
own cost and expense, promptly take such action as may be necessary to discharge
duly all Lessor's Liens attributable to it in its individual capacity and will
claim no indemnity therefor hereunder or under the Participation Agreement.
SECTION 6.05 No Action Except Under Lease, Trust Agreement or
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Instructions. The Owner Trustee shall have no power, right or authority to, and
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the Owner Trustee agrees that it will not, manage, control, use, sell, dispose
of or otherwise deal with the Aircraft or any other property which is part of
the Trust Estate except (i) as expressly required by the terms hereof or of the
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Participation Agreement, the Lease, the Indenture or the Purchase Agreement
Assignment or (ii) in accordance with the express terms hereof or with written
instructions from the Owner Participant pursuant to Section 6.01 or 6.02 hereof.
SECTION 6.06 Preparation of Tax Returns. The Owner Trustee shall be
--------------------------
responsible for the keeping of all appropriate books and records relating to the
receipt and disbursement of all monies under this Trust Agreement or any
agreement contemplated hereby. The Owner Trustee agrees at the expense of the
Lessee to file an application with the Internal Revenue Service for a taxpayer
identification number with respect to the trust created by this Trust Agreement.
The Owner Trustee will at the request of the Owner Participant and at the
expense of the Lessee cause to be prepared all income tax returns required to be
filed with respect to the trust created hereby and shall execute and file such
returns; provided, however, that the Owner Trustee shall send a completed copy
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of such return to the Owner Participant not more than 60 nor less than 30 days
prior to the due date of the return provided that the Owner Trustee shall have
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timely received all necessary information to complete and deliver to the Owner
Participant such return. The Owner Participant, upon request, will furnish the
Owner Trustee with all such information as may be required from the Owner
Participant in connection with the preparation of such income tax returns. The
Owner Trustee shall keep copies of all returns delivered to or filed by it.
SECTION 6.07 Satisfaction of Conditions Precedent. Anything herein to the
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contrary notwithstanding, the Owner Trustee shall upon instructions of the Owner
Participant comply with the provisions of Section 4.01 hereof upon the
satisfaction of all the applicable conditions precedent specified in Section
4.02 hereof and in Section 3 of the Participation Agreement.
SECTION 6.08 Fixed Investment Trust. Notwithstanding anything herein to
----------------------
the contrary, the Owner Trustee shall not be authorized and shall have no power
to "vary the investment" of the Owner Participant within the meaning of Treasury
Regulations Section 301.7701-4(c)(1), it being understood that the Owner Trustee
shall have the power and authority to fulfill its obligations under Section 3.02
hereof, Section 22 of the Participation Agreement and Section 24 of the Lease.
ARTICLE 7.
THE OWNER TRUSTEE
SECTION 7.01 Acceptance of Trusts and Duties. WTC accepts the trusts
-------------------------------
hereby created and agrees to perform the same as Owner Trustee but only pursuant
to the terms of this Trust Agreement and the terms of the Indenture applicable
to it. The Owner Trustee also agrees to receive all monies, and to disburse all
monies actually received by it, constituting part of the Trust Estate
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pursuant to the terms of this Trust Agreement. WTC shall not be answerable or
accountable under any circumstances, except (a) for its own willful misconduct
or gross negligence (including, without limitation, in connection with any
activities of the Owner Trustee in violation of Section 6.05 hereof), (b) for
the inaccuracy of any representation or breach of any warranty or covenant, made
in its individual capacity, set forth in this Trust Agreement, the Participation
Agreement, the Indenture or the Lease, (c) as arising from the failure by WTC to
perform its obligations under the last sentence of Section 6.04 hereof, (d) for
taxes, fees or other charges on, based on, or measured by, any fees, commissions
or compensation received by WTC in connection with the transactions contemplated
by this Trust Agreement, the Participation Agreement, the Indenture or the
Lease, (e) for any failure to use ordinary care in receiving or disbursing funds
or in connection with its obligation to invest funds pursuant to Section 22 of
the Participation Agreement, Section 24 of the Lease, or Section 3.02 of this
Trust Agreement, or (f) for any liability on the part of the Owner Trustee
arising out of its negligence or willful or negligent misconduct in connection
with its obligations under Section 6.01, 6.06 or 10.02 of this Trust Agreement
or Section 3.05(a) or 3.05(b) of the Indenture. Unless otherwise expressly
provided herein or in the Participation Agreement or the Indenture, WTC shall
have no obligation to advance its individual funds for any purpose, and the
Owner Trustee shall have no obligation to distribute to the Owner Participant,
Lessee or any third party any amounts to be paid to the Owner Trustee until such
amounts are collected by the Owner Trustee.
SECTION 7.02 Absence of Duties. Except in accordance with written
-----------------
instructions furnished pursuant to Section 6.01 or 6.02 hereof and except as
explicitly provided in, and without limiting the generality of, Sections 4.01
and 6.04 hereof, and subject to Section 3.05(b) of the Indenture, the Owner
Trustee shall have no duty (i) to see to any registration of the Aircraft or any
recording or filing of the Lease or of this Trust Agreement or of any other
Operative Document, or to see to the maintenance of any such registration,
recording or filing, except that the Owner Trustee shall complete, on the basis
of information timely furnished to the Owner Trustee or the Owner Participant
pursuant to the Participation Agreement or the Lease, and submit on a timely
basis reports relating to the continued eligibility for registration,
identification and activity of the Aircraft or similar reports, which may from
time to time be required by the FAA or other government or governmental
authority having jurisdiction (with copies to the Owner Participant), (ii) to
see to any insurance on the Aircraft or to effect or maintain any such
insurance, whether or not Lessee shall be in default with respect thereto, (iii)
except as provided in Section 7(h) of the Participation Agreement, Section
3.05(a) or (b) of the Indenture or Section 6.04 or 7.01 hereof, to see to the
payment or discharge of any tax, assessment or other governmental charge or any
Lien of any kind owing with respect to, or assessed or levied against, any
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part of the Trust Estate or the Indenture Estate, or, except as provided in
Section 6.06 hereof, the filing of any returns or reports in connection
therewith, (iv) to confirm or verify any financial statements of Lessee or (v)
to inspect the Aircraft at any time or ascertain or inquire as to the
performance or observance of any of Lessee's covenants under the Lease with
respect to the Aircraft. Notwithstanding the foregoing, the Owner Trustee will
furnish to the Indenture Trustee (so long as the Indenture is in effect) and to
the Owner Participant, promptly upon receipt thereof, duplicates or copies of
all reports, notices, requests, demands, certificates, financial statements and
other instruments furnished to or by the Owner Trustee under the Lease or any
other Operative Document except to the extent an Operative Document requires
delivery thereof by some other person directly to the Owner Participant or the
Indenture Trustee.
SECTION 7.03 No Representations or Warranties as to Aircraft or Documents.
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THE OWNER TRUSTEE AND WTC MAKE (i) NO REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, AS TO THE TITLE, AIRWORTHINESS, VALUE, CONDITION, DESIGN, OPERATION,
MERCHANTABILITY OR FITNESS FOR USE OR PARTICULAR PURPOSE OF THE AIRCRAFT OR ANY
PART THEREOF, AS TO THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT
DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR
COPYRIGHT, THE ABSENCE OF ANY STRICT LIABILITY OBLIGATION OR ANY OTHER
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE
AIRCRAFT OR ANY PART THEREOF, except that WTC hereby represents and warrants to
the Owner Participant that (a) on the Delivery Date the Owner Trustee received
whatever title was conveyed to it by Lessee and that (b) the Aircraft was on the
Delivery Date and shall be on the Refunding Date free of Lessor's Liens
attributable to WTC and (ii) no representation or warranty as to the validity,
legality or enforceability of this Trust Agreement, the Indenture, the Trust
Agreement and Trust Indenture Supplement, the Participation Agreement, the
Certificates, the Lease or the Lease Supplement, the Purchase Agreement or the
Purchase Agreement Assignment or any other document or instrument referred to
herein or as to the correctness of any statement contained in any thereof,
except to the extent that any such statement is expressly made herein or therein
as a representation by WTC and except that WTC hereby represents and warrants to
the Owner Participant that (x) this Trust Agreement has been, and, assuming the
due authorization, execution and delivery of this Trust Agreement by the Owner
Participant, each of said other specified documents has been or will be,
executed and delivered by one of its officers who is and will be duly authorized
to execute and deliver such document on its behalf, both in its individual
capacity and as Owner Trustee and (y) WTC has all corporate power and authority
to execute, deliver and perform this Trust Agreement and (z) assuming the due
authorization, execution and delivery of this Trust Agreement by the Owner
Participant, this Trust Agreement constitutes the legal, valid and binding
obligation of WTC enforceable against WTC in accordance with its terms except as
such enforceability may be limited by general equitable principles
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and by applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors rights generally from time to time in effect.
SECTION 7.04 No Segregation of Monies; No Interest. Monies received by the
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Owner Trustee hereunder need not be segregated in any manner except to the
extent required by law, or except as provided in written instructions from the
Owner Participant, and shall be invested as provided in Section 3.02 hereof,
Section 22 of the Participation Agreement or Section 24 of the Lease.
SECTION 7.05 Reliance; Agent; Advice of Counsel. The Owner Trustee shall
----------------------------------
incur no liability in acting upon any signature, instrument, notice, resolution,
request, consent, order, certificate, report, opinion, bond or other document or
paper reasonably believed by it to be genuine and reasonably believed by it to
be signed by the proper party or parties. The Owner Trustee may accept a copy of
a resolution of the Board of Directors of any party to the Participation
Agreement, certified by the Secretary or an Assistant Secretary of such party as
duly adopted and in full force and effect, as conclusive evidence that such
resolution has been duly adopted by said Board and that the same is in full
force and effect. As to any fact or matter the manner of ascertainment of which
is not specifically described herein, the Owner Trustee may, absent actual
knowledge to the contrary, for all purposes hereof rely on a certificate, signed
by the President, or by any Senior Vice President or Vice President, signing
with the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary, of Lessee, as to such fact or matter, and such certificate shall
constitute full protection to the Owner Trustee for any action taken or omitted
to be taken by it in good faith in reliance thereon. In the administration of
the trusts hereunder, the Owner Trustee may execute any of the trusts or powers
hereof and perform its powers and duties hereunder directly or through agents or
attorneys and, at the expense of the Trust Estate, consult with independent
counsel, accountants and other skilled persons to be selected and employed by
it, and the Owner Trustee shall not be liable for anything done, suffered or
omitted in good faith by it in accordance with the written advice or opinion of
any such counsel, accountants or other skilled persons appointed by it with due
care hereunder.
SECTION 7.06 Not Acting in Individual Capacity. In carrying out the trusts
---------------------------------
hereby created, the Owner Trustee will act solely as owner trustee hereunder and
not in its individual capacity except as expressly provided herein or in the
other Operative Documents to which it is a party; and all persons, other than
the Owner Participant as provided in this Trust Agreement and the Indenture,
having any claim against the Owner Trustee by reason of the transactions
contemplated hereby shall look only to the Trust Estate for payment or
satisfaction thereof, except to the extent provided in the penultimate sentence
of Section 7.01 hereof.
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SECTION 7.07 Compensation. Except as provided in Section 6.03 or Section
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8.01 hereof, each of WTC and the Owner Trustee agrees that it shall have no
right against the Owner Participant or the Trust Estate for any fee as
compensation for its services hereunder.
ARTICLE 8.
INDEMNIFICATION OF WTC BY OWNER PARTICIPANT
SECTION 8.01 Owner Participant to Indemnify WTC. Whether or not any of the
----------------------------------
transactions contemplated hereby or by the Participation Agreement shall be
consummated, the Owner Participant shall assume liability for, and shall
indemnify, protect, save and keep harmless WTC and its successors, assigns,
agents and servants, from and against any and all liabilities, obligations,
losses, damages, penalties, taxes (excluding any Taxes, as defined in the
Participation Agreement, which are not required to be indemnified by Lessee
pursuant to Section 6(b) of the Participation Agreement (disregarding for
purposes of this Section 8.01, clause (ix)(to the extent such voluntary transfer
or disposition by the Owner Trustee is made at the direction of the Owner
Participant) and clause (xi) of Section 6(b)) and excluding any taxes payable by
WTC on or measured by any compensation received by WTC for its services
hereunder), claims, actions, suits, costs, expenses and disbursements (including
reasonable legal fees and expenses) of any kind and nature whatsoever which may
be imposed on, incurred by or asserted against WTC (whether or not also
indemnified against by any other person under any other document) relating to or
arising out of the Original Documents, this Trust Agreement, the Indenture, the
Trust Agreement and Trust Indenture Supplement, the Certificates, the Lease or
the Participation Agreement or the enforcement of any of the terms of any
thereof, or relating to or arising out of the manufacture, purchase, acceptance,
non-acceptance, rejection, ownership, delivery, lease, possession, use,
operation, condition, sale, return or other disposition of the Aircraft
(including, without limitation, latent and other defects, whether or not
discoverable, and any claim for patent, trademark or copyright infringement), or
relating to or arising out of the administration of the Trust Estate or the
action or inaction of the Owner Trustee hereunder, or under the Indenture or
under the Lease, except only in the case of (i) gross negligence or willful
misconduct on the part of the Owner Trustee or WTC or (ii) the breach or
inaccuracy of any of WTC's representations or warranties or covenants referred
to in Section 7.01(b) or 7.03 hereof or in the second sentence of Section 6.04
hereof, or (iii) the breach or inaccuracy of any of the representations or
warranties or covenants of WTC in any of the other Operative Documents, or (iv)
for the failure to use ordinary care to receive or disburse funds or in
connection with its obligation to invest funds pursuant to Section 22 of the
Participation Agreement, Section 24 of the Lease or Section 3.02 of this Trust
Agreement, or (v) any liability on the part of the
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Owner Trustee arising out of its negligence or willful or negligent misconduct
in connection with its obligations under Section 6.01, 6.06 or 10.02 of this
Trust Agreement or Section 3.05(a) or (b)(ii) or (iii) of the Indenture, or (vi)
as otherwise excluded by the terms of Section 6(c) of the Participation
Agreement from the Lessee's general indemnity to the Owner Trustee under said
Section; provided that none of the foregoing exceptions shall limit the
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obligation of the Owner Participant to indemnify WTC for actions taken in
accordance with the written instructions of the Owner Participant; and provided,
--------
further, that before asserting its right to indemnification, if any, pursuant to
-------
this Section 8.01, WTC shall first demand its corresponding right to
indemnification pursuant to Section 6 of the Participation Agreement (but need
not exhaust any or all remedies available thereunder). The indemnities contained
in this Section 8.01 extend to WTC and shall not be construed as part of the
Trust Estate or the Indenture Estate (except to the extent, if any, that WTC has
been reimbursed from the Trust Estate or Indenture Estate for amounts covered by
the indemnities in this Section 8.01). The indemnities contained in this Section
8.01 shall survive the termination of this Trust Agreement. In addition, if
necessary, WTC shall be entitled to indemnification from the Trust Estate for
any liability, obligation, loss, damage, penalty, tax, claim, action, suit,
cost, expense or disbursements indemnified against pursuant to this Section 8.01
to the extent not reimbursed by Lessee, the Owner Participant or others, but
without releasing any of them from their respective agreements of reimbursement;
and to secure the same WTC shall have a Lien on the Trust Estate, which shall be
subject to any interest therein of the Indenture Trustee or any Holder, but
which shall be prior to any interest therein of the Owner Participant. The payor
of any indemnity under this Section 8.01 shall be subrogated to any right of the
person indemnified in respect of the matter as to which such indemnity was paid.
ARTICLE 9.
TRANSFER OF OWNER
PARTICIPANT'S INTERESTS
SECTION 9.01 Conditions. Prior to the termination or expiration of the
----------
Lease, the Owner Participant shall not assign, convey or otherwise transfer any
of its right, title or interest in and to this Trust Agreement, the properties
of the Owner Trustee pledged or mortgaged as part of the Indenture Estate, the
Participation Agreement or the Indemnity Agreement; provided, however, that the
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Owner Participant may after the Delivery Date convey to any one person
(hereinafter in this Article 9 referred to as the "Transferee") all, but not
less than all, of its right, title and interest in and to this Trust Agreement,
the properties of the Owner Trustee pledged or mortgaged as part of the
Indenture Estate, the Participation Agreement or the Indemnity Agreement, but
only if (i) the Transferee is a Citizen of the United States
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(if and so long as such citizenship is required under the Act to permit the
United States registration of the Aircraft (it being understood that the
existence of any such requirement shall be determined without giving
consideration to any provision of the Act (or any superseding statute) which
permits United States registration of an Aircraft based on conditions which
impose restrictions on the location and use of the Aircraft or otherwise
restrict the ability of an air carrier to operate the Aircraft in the ordinary
course of its business)), or shall use a voting powers trust or similar
arrangement in order to hold the Trust Estate such that the Aircraft can be
registered in the United States without imposing restrictions on the location or
use of the Aircraft, the ability of an air carrier to operate the Aircraft in
the ordinary course of its business or the ability of Lessee to exercise its
rights under the Operative Documents, and has the requisite power and authority
to enter into and carry out the transactions contemplated hereby, (ii) the
Transferee enters into an agreement or agreements (such agreement to include
representations and warranties (and, with respect to citizenship, to reflect
whether or not the Transferee is making use of a voting powers trust or similar
arrangement) substantially similar to those made by the original Owner
Participant in the Participation Agreement as reasonably requested by the
Indenture Trustee, including but not limited to, the representation and warranty
contained in Sections 7(b)(iii), (iv) and (viii) of the Participation Agreement,
assuming the truth of the representations, warranties and covenants contained in
the Certificates, Sections 6(a)(xx) and 7(e) of the Participation Agreement,
Section 10.06 of the Indenture and Section 6.06 of the Pass Through Agreement
and to be accompanied by a favorable opinion of counsel with respect to the due
authorization, execution, delivery and enforceability of such agreement and such
other matters as may be reasonably requested), whereby the Transferee confirms
that it shall be deemed a party to the Participation Agreement and a party to
this Trust Agreement and agrees to be bound by all the terms of, and to
undertake all of the obligations of, the Owner Participant making such
conveyance contained in the Participation Agreement and this Trust Agreement to
the extent of the right, title or interest being conveyed and, if not otherwise
amenable to service of process in the State of New York, appoints CT Corporation
System, 0000 Xxxxxxxx, Xxx Xxxx, X.X. 00000, as its agent for service of process
in connection with the Participation Agreement and this Trust Agreement, (iii)
such conveyance does not violate any provision of the Act, or other law or
regulation or create a relationship which would be in violation thereof,
assuming the truth of the representations, warranties and covenants contained in
Sections 6(a)(xx) and 7(e) of the Participation Agreement, Section 10.06 of the
Indenture and Section 6.06 of the Pass Through Agreement and the Certificates,
(iv) the Transferee is not an employee benefit plan subject to ERISA or an
individual retirement account or a plan subject to Section 4975 of the Code and
(v) the Transferee is not, without the consent of Lessee (which consent shall
not be unreasonably withheld), an airline (or other commercial aircraft operator
or
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Affiliate thereof) which is in direct competition with Lessee, and (vi) the
Transferee is (A) a bank, trust company, insurance company, pension trust,
finance or leasing corporation or other corporation or financial institution, in
each case with a combined capital and surplus or net worth, as the case may be,
of at least $75,000,000 (a "Permitted Institution"), or (B) (i) a corporation
which is a member of the same consolidated group for tax purposes as such
original Owner Participant (a "Permitted Affiliate"), or (ii) a corporation
which is the subsidiary of a Permitted Institution, under either case in this
clause (B) the obligations of which are guaranteed by the original Owner
Participant or a Permitted Institution, as the case may be, pursuant to a
written guaranty together with a favorable opinion of counsel to the guarantor
(such guaranty and opinion to be in form and substance reasonably satisfactory
to Lessee, WTC and, so long as the Lien of the Indenture has not been released,
the Indenture Trustee) unless such transferee corporation has a combined capital
and surplus or net worth, as the case may be, of at least $75,000,000.
Upon any such conveyance by the Owner Participant as above provided and as
provided in Section 16 of the Participation Agreement, the Transferee shall be
deemed an Owner Participant for all purposes of this Trust Agreement, and shall
be deemed to have made that portion of the Commitment for the Aircraft
previously made by the Owner Participant making such conveyance and represented
by the interest being conveyed and each reference herein to the Owner
Participant making such conveyance shall thereafter be deemed a reference to the
Transferee for all purposes. If the Owner Participant shall make any conveyance
to a Transferee meeting the requirements of clause (A) or (B) above, the Owner
Participant shall be released (except to the extent of any guaranty provided by
it under clause (vi)(B) of the preceding paragraph) from all liabilities and
obligations under this Trust Agreement and any other Operative Document to the
extent such liabilities and obligations arise after such transfer; provided that
--------
the Owner Participant (and its Affiliates, successors, assigns, agents,
servants, representatives, directors and officers) will continue to have the
benefit of any rights or indemnities vested or relating to events prior to such
transfer. Notwithstanding anything to the contrary contained in this Section
9.01, the merger or consolidation of the Owner Participant with any other
corporation or association (the "New Corporation") shall not constitute an
assignment, conveyance or transfer for purposes of this Section 9.01; provided,
--------
however, the Owner Participant shall give notice as promptly as practicable to
-------
the Owner Trustee, the Indenture Trustee, and Lessee of the consummation of the
merger or consolidation, which notice shall be given, subject to any applicable
securities laws, upon the earliest of (i) such information becoming publicly
available, (ii) any action or consent by the Owner Participant or Lessee under
the Operative Documents required in connection with such merger or
consolidation, and (iii) the consummation of such merger or consolidation;
provided, however, that such merger or consolidation shall not cause any right,
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title or interest of the
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Owner Participant in and to this Trust Agreement, the properties of the Owner
Trustee pledged or mortgaged as part of the Indenture Estate, the Participation
Agreement or the Indemnity Agreement to become an asset (within the meaning of
ERISA and any applicable rules and regulations) of an employee benefit plan
subject to Title I of ERISA or of an individual retirement account or a plan
subject to Section 4975 of the Code. If the New Corporation is an airline
operating regularly scheduled commercial jet passenger or cargo transport
service on domestic United States routes or an Affiliate of such an airline and
Lessee does not approve of the New Corporation as the Transferee of the Owner
Participant, the Owner Participant and Lessee shall have the respective rights
and obligations set forth in Section 16 of the Participation Agreement. All
expenses in connection with any such transfer shall be for the account of the
Owner Participant.
The Owner Participant may at any time assign, convey or otherwise transfer
any or all of its right, title or interest in and to the residual value of the
Aircraft (including without limitation a transfer of all or a portion of (1) any
net proceeds from a sale or re-lease of the Aircraft whether at the end of the
Basic Term or the Renewal Term, if any, or pursuant to any provision of the
Lease or otherwise or (2) the net proceeds received as a result of an Event of
Loss or an Event of Default) and any transferee thereof need not satisfy the
requirements for a "Transferee" hereunder so long as the Owner Participant
otherwise remains the holder of the beneficial interest in the Trust Estate.
If there is more than one Owner Participant, no assignment, conveyance or
other transfer by an Owner Participant of any of its right, title or interest in
and to this Trust Agreement or the Trust Estate shall be valid unless each other
Owner Participant's prior written consent is given to such assignment,
conveyance or other transfer, which consent may be withheld in such other Owner
Participant's sole discretion.
SECTION 9.02 Notice. Any Owner Participant proposing to transfer its
------
interests hereunder pursuant to Section 9.01 hereof shall give written notice to
Lessee, the Owner Trustee and the Indenture Trustee, specifying the name and
address of the Transferee and the facts necessary to determine compliance with
Section 9.01 hereof, provided, however, that in the case of a transfer to a
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Permitted Affiliate or in the case of a transfer of all or a substantial portion
of the Owner Participant's aircraft lease portfolio to an entity that is not an
airline or commercial operator of aircraft or an Affiliate thereof, such notice
may be given not more than 10 days following such transfer.
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ARTICLE 10.
SUCCESSOR OWNER TRUSTEES; APPOINTMENT OF SEPARATE TRUSTEES
SECTION 10.01 Resignation of Owner Trustee; Appointment of Successor. (a)
------------------------------------------------------
The Owner Trustee or any successor Owner Trustee shall resign immediately upon
obtaining actual knowledge of any facts which would cast reasonable doubt upon
its continuing status as a Citizen of the United States (in which case the Owner
Participant will promptly appoint a successor Owner Trustee pursuant to Section
15(g)(C) of the Participation Agreement), and may resign at any time, by giving
at least 60 days' prior written notice to the Indenture Trustee and to each
Owner Participant, such resignation in each such case to be effective on the
date the trusts hereunder are assumed by a successor Owner Trustee. In addition,
the Owner Participant may at any time remove the Owner Trustee without cause by
an instrument in writing delivered to the Owner Trustee and the Indenture
Trustee. In case of the resignation or removal of the Owner Trustee, the Owner
Participant may appoint a successor Owner Trustee by an instrument signed by the
Owner Participant. If a successor Owner Trustee shall not have been appointed
within 30 days after such resignation or removal, the Owner Trustee, the Owner
Participant or the Indenture Trustee may apply to any court of competent
jurisdiction to appoint a successor Owner Trustee to act until such time, if
any, as a successor shall have been appointed as above provided. Any successor
Owner Trustee so appointed by such court shall immediately and without further
act be superseded by any successor Owner Trustee appointed as above provided.
(b) Any successor Owner Trustee, whether appointed by a court or by
the Owner Participant, shall execute and deliver to the predecessor Owner
Trustee, with a copy to the Owner Participant and the Indenture Trustee, an
instrument accepting such appointment, and thereupon such successor Owner
Trustee, without further act, shall become vested with all the estates,
properties, rights, powers, duties and trusts of the predecessor Owner Trustee
hereunder in the trusts hereunder, with like effect as if originally named the
Owner Trustee herein; but nevertheless, upon the written request of such
successor Owner Trustee, such predecessor Owner Trustee shall execute and
deliver an instrument transferring to such successor Owner Trustee, and such
predecessor Owner Trustee shall duly assign, transfer, deliver and pay over to
such successor Owner Trustee, all the estates, rights, powers, duties, monies or
other property then held by such predecessor Owner Trustee hereunder, upon the
trusts herein expressed.
Upon the appointment of any successor Owner Trustee hereunder, the
predecessor Owner Trustee will use its best efforts to cause registration of the
Aircraft included in the Trust Estate to be transferred upon the records of the
FAA, or other governmental authority having jurisdiction, into the name of the
successor Owner Trustee.
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(c) Any successor Owner Trustee, however appointed, shall (i) be a
Citizen of the United States, and (ii) be a bank or trust company organized
under the laws of the United States or any State and having its principal place
of business in the United States of America, and having a combined capital and
surplus of at least $100,000,000, if there be such an institution willing, able
and legally qualified to perform the duties of the Owner Trustee hereunder upon
reasonable or customary terms.
(d) Any corporation into which the Owner Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Owner Trustee shall be
a party, or any corporation to which substantially all the corporate trust
business of the Owner Trustee may be transferred, shall, subject to the terms of
paragraph (c) of this Section 10.01, be the Owner Trustee under this Trust
Agreement without further act, provided that such corporation shall not also be
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the Indenture Trustee.
(e) The 60-day notice period specified in the first sentence of
paragraph (a) of this Section 10.01 shall be reduced as necessary so that any
resignation of the Owner Trustee or any successor Owner Trustee shall be
effective prior to the date such Owner Trustee no longer qualifies, or is
expected no longer to qualify, as a Citizen of the United States.
SECTION 10.02 Appointment of Separate Trustees. (a) At any time or times,
--------------------------------
in the event that the Owner Trustee or the Owner Participant shall deem it
necessary or prudent or desirable in order to conform to the legal requirements
of any jurisdiction in which any part of the Trust Estate may at such time or
times be located, the Owner Trustee by an instrument in writing signed by it,
shall appoint one or more individuals or corporations approved by the Owner
Participant to act as separate trustee or separate trustees of all or any part
of the Trust Estate to the full extent that local law makes it necessary or
prudent or desirable for such separate trustee or separate trustees to act.
(b) The Owner Trustee and the Owner Participant shall execute,
acknowledge and deliver all such instruments as may be required by any such
separate trustee or separate trustees for more fully confirming such title,
rights or duties to such separate trustee or separate trustees. Upon the
acceptance in writing of such appointment by any such separate trustee or
separate trustees, it, he or they shall be vested with such title to the Trust
Estate or any part thereof, and with such rights and duties, as shall be
specified in the instrument of appointment, jointly with the Owner Trustee
(except insofar as local law makes it necessary or prudent or desirable for any
such separate trustee or separate trustees to act alone) subject to all the
terms of this Trust Agreement. Any separate trustee or separate trustees may, at
any time by an instrument in writing, constitute the Owner Trustee its, their or
his attorney-in-fact and agent with full power and authority to do all acts and
things and to exercise all
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discretion on its, their or his behalf and in its, their or his name.
Every additional trustee hereunder shall be a Citizen of the United States
and, to the extent permitted by law, be appointed and act, and the Owner Trustee
and its successors shall act, subject to the following provisions and
conditions:
(A) all powers, duties, obligations and rights conferred upon the
Owner Trustee in respect of the custody, control and management of monies,
the Aircraft or documents authorized to be delivered hereunder or under the
Participation Agreement shall be exercised solely by the Owner Trustee;
(B) all other rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred or imposed upon and
exercised or performed by the Owner Trustee and such additional trustee
jointly, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed (including the holding
of title to the Trust Estate) the Owner Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations shall be exercised and performed by such
additional trustee;
(C) no power given to, or which it is provided hereby may be
exercised by, any such additional trustee shall be exercised hereunder by
such additional trustee, except jointly with, or with the consent in
writing of, the Owner Trustee;
(D) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder;
(E) the Owner Participant, at any time, by an instrument in writing
may remove any such additional trustee. In the event that the Owner
Participant shall not have joined in the execution of any such instrument
within ten days after the receipt of a written request from the Owner
Trustee so to do, the Owner Trustee shall have the power to remove any such
additional trustee without the concurrence of the Owner Participant; and
the Owner Participant hereby appoints the Owner Trustee its agent and
attorney-in-fact for it in such connection in such contingency; and
(F) no appointment of, or action by, any additional trustee will
relieve the Owner Trustee of any of its obligations under, or otherwise
affect any of the terms of, the Indenture or affect the interests of the
Indenture Trustee or the Holders in the Indenture Estate.
In case such separate trustee shall die, become incapable of acting, resign or
be removed, the title to the Trust Estate and all rights and duties of such
separate trustee shall, so far as
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permitted by law, vest in and be exercised by the Owner Trustee, without the
appointment of a successor to such separate trustee.
(c) All provisions of this Trust Agreement which are for the benefit
of the Owner Trustee shall extend to and apply to each separate trustee
appointed pursuant to the foregoing provisions of this Section 10.02, including
without limitation Article 8 hereof.
ARTICLE 11.
SUPPLEMENTS AND AMENDMENTS TO THIS TRUST AGREEMENT
AND OTHER DOCUMENTS
SECTION 11.01 Instructions of Owner Participant; Limitations. At any time
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and from time to time, upon the written request of the Owner Participant and
subject to the requirements of Section 8(c) of the Participation Agreement (i)
the Owner Trustee, together with the Owner Participant making such request,
shall execute a supplement hereto for the purposes of adding provisions to, or
changing or eliminating provisions of, this Trust Agreement (except Section
12.12 hereof) as specified in such request, (ii) the Owner Trustee shall enter
into such amendment of or supplement to the Participation Agreement as specified
in such request and (iii) the Owner Trustee shall, subject to compliance with
any applicable provisions of the Indenture, enter into such written amendment of
or supplement to the Indenture, the Lease, the Purchase Agreement or the
Purchase Agreement Assignment as the other parties thereto may agree to and as
may be specified in such request, or execute and deliver such written waiver or
modification of the terms of the Indenture or the Lease, as may be specified in
such request. Without the written consent of the Owner Participant, the Owner
Trustee shall not execute any such supplement, amendment, waiver or
modification. Without the consent of Lessee, no such supplement or amendment to
this Trust Agreement or waiver or modification of the terms hereof shall permit
or require any action contrary to, or disturb, Lessee's rights under the Lease
or amend or modify the terms of Section 10.01(a) or 10.01(c) hereof relating to
the status of the Owner Trustee as a Citizen of the United States. Without the
consent of the Indenture Trustee, this Article and Sections 12.01, 12.02, 12.03,
12.04, 12.12 and 12.13 hereof shall not be amended, and compliance with any
provisions thereof shall not be waived by the Owner Participant or the Owner
Trustee (unless such amendment or waiver is consented to by the Indenture
Trustee) until the final satisfaction and discharge of the Indenture pursuant to
the terms thereof. The provisions of this Section 11.01 notwithstanding, the
Owner Trustee shall not be required to, and the Owner Trustee agrees for the
benefit of the Holders that it will not, execute any amendment which in the
reasonable judgment of the Owner Trustee might result in the trusts created
hereunder being terminated prior to the release of the Lien of the Indenture on
the Trust Estate or prior to the payment in full, as of the date of payment
thereof, of the aggregate unpaid principal amount of
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the Certificates outstanding on such date of payment, together with the accrued
and unpaid interest and to premium, if any, thereon and the aggregate amount, if
any, of all sums which, if Section 5.03 of the Indenture were applicable, would
be entitled to be paid in priority to or on a parity with the payment of
principal and interest on such Certificates.
A signed copy of each amendment or supplement to this Trust Agreement shall
be delivered by the Owner Trustee to the Indenture Trustee, without in any way
affecting the Indenture or the Certificates and without imposing any duty on the
Indenture Trustee with respect to such amendment or supplement.
SECTION 11.02 Owner Trustee Protected. If, in the reasonable opinion of
-----------------------
the Owner Trustee, any document required to be executed pursuant to the terms of
Section 11.01 hereof adversely affects any right, duty, immunity or indemnity in
favor of the Owner Trustee under this Trust Agreement, the Indenture or the
Lease, the Owner Trustee may in its discretion decline to execute such document,
unless the Owner Trustee is furnished with indemnification from the Lessee or
any other party upon terms and in amounts reasonably satisfactory to the Owner
Trustee to protect the Trust Estate and the Owner Trustee against any and all
liabilities, costs and expenses arising out of the execution of such documents.
SECTION 11.03 Request of Substance, Not Form. It shall not be necessary
------------------------------
for any written request furnished pursuant to Section 11.01 hereof to specify
the particular form of the proposed documents to be executed pursuant to said
Section 11.01, but it shall be sufficient if such request shall indicate the
substance thereof.
ARTICLE 12.
MISCELLANEOUS
SECTION 12.01 Termination of Trust Agreement. (a) This Trust Agreement and
------------------------------
the trusts created hereby shall terminate and this Trust Agreement shall be of
no further force or effect upon the earlier of (i) the sale or other final
disposition by the Owner Trustee of all property constituting part of the Trust
Estate and the final distribution by the Owner Trustee of all monies or other
property or proceeds constituting part of the Trust Estate in accordance with
the terms of Article 5 hereof or (ii) the effective date of the revocation and
termination of the trusts as stated in a notice in writing given by the Owner
Participant to the Owner Trustee, which date shall not be less than ten nor more
than thirty days from the date of mailing such notice; provided, however, that
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such notice of revocation and termination shall be of no force or effect unless
either the Indenture shall have been terminated or the Indenture Trustee shall
have consented in writing to such termination and
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revocation. Notwithstanding the foregoing, this Trust Agreement and the trusts
created hereby shall terminate no later than 110 years from the earlier
execution of this Trust Agreement by either party hereto; provided, however,
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that if the trust shall be or become valid under applicable law for a period
subsequent to 110 years from the earlier execution of this Trust Agreement by
either party hereto or, without limiting the generality of the foregoing, if
legislation shall become effective providing for the validity or permitting the
effective grant of such trust for a period, in gross, exceeding the period for
which such trust is hereinabove stated to extend and be valid, then such trust
shall not terminate as provided in the first part of this sentence but shall
extend to and continue in effect until, but only if such nontermination and
extension shall then be valid under applicable law, such time as the same shall,
under applicable law, cease to be valid, whereupon all monies or other property
or proceeds constituting part of the Trust Estate shall be distributed in
accordance with the terms of Article 5 hereof; otherwise this Trust Agreement
and the trusts created hereby shall continue in full force and effect in
accordance with the terms hereof.
(b) Notwithstanding any provisions herein to the contrary, the Owner
Participant shall not revoke or terminate this Trust Agreement without the
consent of the Indenture Trustee (which consent shall not be unreasonably
withheld) until the final satisfaction and discharge of the Indenture pursuant
to the terms thereof. In addition, except as otherwise expressly provided
herein, the Owner Participant may not withdraw any part of the Trust Estate
subject to the Lien of the Indenture prior to the discharge of such Lien with
respect to such part of the Trust Estate pursuant to the Indenture, without the
consent of the Indenture Trustee.
SECTION 12.02 No Legal Title to Trust Estate in Owner Participant. The
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Owner Participant shall not have legal title to any part of the Trust Estate. No
transfer, by operation of law or otherwise, of any right, title and interest of
the Owner Participant in and to the Trust Estate hereunder shall operate to
terminate this Trust Agreement or the trusts hereunder or entitle any successor
or transferee of the Owner Participant to an accounting or to the transfer to it
of legal title to any part of the Trust Estate.
SECTION 12.03 Sale of Aircraft by Owner Trustee Is Binding. Any sale or
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other conveyance of the Aircraft by the Owner Trustee made pursuant to the terms
of this Trust Agreement, the Participation Agreement or the Lease shall bind the
Owner Participant and shall be effective to transfer or convey all right, title
and interest of the Owner Trustee and such Owner Participant in and to the
Aircraft sold or conveyed but shall be subject to the Indenture and the rights
of the Holders. No purchaser or other grantee shall be required to inquire as to
the authorization, necessity, expediency or regularity of such sale or
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conveyance or as to the application of any sale or other proceeds with respect
thereto by the Owner Trustee.
SECTION 12.04 Trust Agreement for Benefit of Owner Trustee, the Indenture
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Trustee and Owner Participant Only. Except as expressly provided herein,
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nothing in this Trust Agreement, whether express or implied, shall be construed
to give to any person other than the Owner Trustee, the Indenture Trustee and
the Owner Participant any legal or equitable right, remedy or claim under or in
respect of this Trust Agreement; this Trust Agreement shall be held for the sole
and exclusive benefit of the Owner Trustee and the Owner Participant and, solely
with respect to Sections 5.01, 11.01, 12.01, 12.02, 12.03 and 12.04 hereof and
to the extent provided therein, the Indenture Trustee.
SECTION 12.05 Notices. Unless otherwise specifically provided herein, all
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notices required or permitted by the terms hereof shall be in writing and shall
be delivered personally or by prepaid courier service or, if promptly confirmed
as provided above, dispatched by telegram, telex or other written
telecommunication, addressed (i) if to the Owner Trustee, at its office at
Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000-0000,
Attention: Corporate Trust Administration, or at such other address as the Owner
Trustee shall from time to time designate in writing to the Owner Participant,
(ii) if to the Indenture Trustee, at its office at 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 Attention: Corporate Trust-Corporate Finance Group with a copy to
it x/x XXX Xxxxxxxx Xxxxxx, Xxx., 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxx 00000, Attention: Corporate Trust Lease Administration, or at such other
address as the Indenture Trustee shall from time to time designate in writing to
the Owner Trustee and the Owner Participant, and (iii) if to the Owner
Participant, at such address as the Owner Participant shall have furnished by
notice to the Owner Trustee or, until an address is so furnished, at its address
set forth on Annex II to the Participation Agreement. All notices delivered,
mailed or dispatched pursuant to this Section 12.05 shall become effective when
received, except with respect to any notice given by telegram, telecopy, telex
or other written telecommunication, in which case notice shall be deemed
received when confirmation is received. In the case of a telex, an answer-back
and in the case of courier service, a return receipt will be the conclusive
evidence as receipt.
SECTION 12.06 Severability. Any provision of this Trust Agreement which
------------
is prohibited or unenforceable in any jurisdiction shall, as to 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.
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SECTION 12.07 Limitation on Owner Participant's Liability. The Owner
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Participant shall not have any liability for the performance of this Trust
Agreement, except as expressly set forth herein.
SECTION 12.08 Separate Counterparts. This Trust 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 instrument. It shall not be necessary, when
making proof of this Trust Agreement, to produce or account for more than one
counterpart.
SECTION 12.09 Successors and Assigns. All covenants and agreements
----------------------
contained herein shall be binding upon, and inure to the benefit of, the Owner
Trustee and its successors and assigns, the Owner Participant and its successors
and, to the extent permitted by Article 9 hereof, its assigns, all as herein
provided. Any request, notice, direction, consent, waiver or other instrument or
action by any Owner Participant shall bind the successors and assigns of such
Owner Participant.
SECTION 12.10 Headings. The headings of the various Articles and Sections
--------
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof.
SECTION 12.11 Governing Law. This Trust Agreement shall in all respects be
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governed by, and construed in accordance with, the laws of the State of
Delaware, excluding any conflict of laws rules that would subject the matter to
the laws of another jurisdiction, including all matters of construction,
validity and performance.
SECTION 12.12 Authorization to Owner Trustee for Indenture.
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Notwithstanding any contrary provision in this Trust Agreement, the Owner
Trustee is hereby authorized and instructed to enter into and perform fully the
Indenture. This provision is for the benefit of the Owner Trustee, the Indenture
Trustee and the Holders and shall not be changed prior to the termination of the
Indenture pursuant to Section 14.01 thereof.
SECTION 12.13 Waivers, etc. No term or provision hereof may be changed,
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waived, discharged or terminated orally, but only by an instrument in writing
entered into in compliance with the terms of Article 11 hereof; and any waiver
of the terms hereof shall be effective only in the specific instance and for the
specific purpose given.
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SECTION 12.14 Performance by Owner Participant. Any obligation of the
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Owner Trustee in its individual capacity or as Owner Trustee hereunder or under
any of the other Operative Documents or other documents contemplated herein may
be performed by the Owner Participant, and any such performance shall not be
construed as a revocation of the trusts created hereby.
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to
be duly executed by their respective officers thereunto duly authorized, as of
the day and year first written above.
OWNER PARTICIPANT
____________________________
By:________________________________
Title:
OWNER TRUSTEE
WILMINGTON TRUST COMPANY
By:________________________________
Title:
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