EXHIBIT 10.77
RETURN COMPENSATION AGREEMENT
dated as of December 6, 1999
in respect of
AIRCRAFT OPERATING LEASE AGREEMENTS
XX. 000, XX. 000, XX. 000 and NO. 136
between
FIRST SECURITY BANK, N.A., formerly known as
FIRST SECURITY BANK OF UTAH, N.A.,
not in its individual capacity
but solely as owner trustee, as
Lessor
and
MIDWAY AIRLINES CORPORATION, as
Lessee
and
DEBIS AIRFINANCE B.V., as
Beneficial Owner.
Aircraft: Fokker 100 (F28 Mk 0100)
Serial Nos. 11321, 11323, 11329 and 11330
Return Compensation Agreement (this "Agreement"), dated as of December 6, 1999,
by and between:
(1) debis AirFinance B.V., a company incorporated under the laws of The
Netherlands, having its principal place of business at Xxxxx van de
Xxxxxxxxxx 00, 0000 XX Xxxxxxxx Airport, The Netherlands ("debis AF");
(2) Midway Airlines Corporation, a company incorporated under the laws of the
State of Delaware, having its principal place of business at 0000 Xxxxxx
Xxxx, Xxxxx 000, Xxxxxxxxxxx, Xxxxx Xxxxxxxx 00000 ("Midway" or "Lessee");
and
(3) First Security Bank, N.A., formerly known as First Security Bank of Utah,
N.A., a national banking association existing pursuant to the laws of the
United States, having its principal place of business at 00 Xxxxx Xxxx
Xxxxxx, Xxxx Xxxx Xxxx, Xxxx 00000-0000, not in its individual capacity
(except as expressly set forth in the Leases) but solely as Owner Trustee
under the Trust Agreement ("Trustee" or "Lessor").
WHEREAS, debis AF is the beneficial owner of each of the four (4) aircraft
identified in Exhibit A attached hereto (each, a "300-Series Aircraft" and
collectively, the "300-Series Aircraft"), by virtue of its ownership of all the
outstanding and issued shares of the special purpose companies which are the
owners of the Aircraft identified by Serial Numbers 11321, 11323, 11329 and
11330; and
WHEREAS, the Trustee and Midway are parties to those certain Aircraft Operating
Lease Agreements Xx. 000, Xx. 000, Xx. 000 and No. 136, each covering one of the
Aircraft (as amended from time to time, each, a "Lease" and collectively, the
"Leases");
WHEREAS, on behalf of debis AF, the Trustee has commenced an action against
Midway entitled First Security Bank, N.A. v. Midway Airlines, Inc. 99 CIV.3248
(SAS)(RLE) now pending in the United States District Court for the Southern
District of New York (the "Action") which claims, inter alia, that Midway owes
the Lessor certain moneys in connection with the return of the 300-Series
Aircraft; and
WHEREAS, Midway has asserted a claim against the Lessor and debis AF with
respect to certain excess Maintenance Funds to which it claims to be entitled;
and
WHEREAS, Midway, debis AF and the Trustee desire to settle the Action on the
terms and conditions set forth herein:
NOW THEREFORE, in consideration of the mutual promises herein contained, the
parties hereto agree as follows:
1. Definitions
Terms which are capitalized but not defined herein shall have the
meaning ascribed to such terms in the Leases.
2. Payment for Settlement of the Action and other Claims
In full settlement of all claims of whatever nature which Lessor
and/or debis AF may have against Midway and Midway may have against
Lessor and/or debis AF arising out of the Leases, Lessor and/or debis
AF agrees to pay to Midway the sum of *** ************ ******* ******
******* *** ******* ***** ******* ******** ******** ***** ******* ***
************ ******* *** ****** ****** which shall be on March 1, 2000
by the reduction in such amount of the outstanding principal balance
under that certain Promissory Note originally dated as of January 31,
1997 and amended and restated as of March 30, 1998 payable by Midway
to debis AF. Except for the reduction in principal amount set forth
* redacted
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herein, all other terms of the Promissory Note shall remain unchanged.
3. Release of Claims
The Lessor's and debis AF's payment hereunder, and the other promises,
payments and agreements set forth herein shall be in full and final
settlement of, and the release and discharge of, (i) all of Lessor's
and/or debis AF's claims with respect to the payment of any amounts
due under any of the Leases whether now existing or hereafter arising;
(ii) all other claims, however described, asserted in the Action; and
(iii) all claims of Midway under any of the Leases, in each case
whether now existing or hereafter arising.
4. Dismissal of Litigation
The parties hereto agree to instruct their respective attorneys to
enter into and file in the United States District Court for the
Southern District of New York an appropriate stipulation providing for
the dismissal with prejudice of the Action.
5. Governing Law
This Agreement shall be governed by and construed in accordance with
the internal laws of the State of New York and without regard to any
conflict of law rules. This Agreement is being delivered in the State
of New York.
6. Entire Agreement
This Agreement is the sole and entire agreement between the parties
hereto with respect to the Leases and the Aircraft, and supersedes all
previous agreements in relation to such Leases and Aircraft. The
terms and conditions of this Agreement shall not be varied otherwise
than by an instrument in writing executed by or on behalf of the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized as of the day and year
first above written.
SIGNED on behalf of
FIRST SECURITY BANK, N.A. (formerly known as First Security Bank of Utah; N.A.),
not in its individual capacity but solely as owner trustee
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Vice President
SIGNED on behalf of
MIDWAY AIRLINES CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxx
Name: Xxxxxxxx X. Xxxxxx
Title: Senior Vice President
General Counsel
SIGNED on behalf of
debis AirFinance B.V.
By: /s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title: Managing Director (CEO)
By: /s/ Xxxx XxXxxxx
Name: Xxxx XxXxxxx
Title: Senior Vice President - Commercial
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Exhibit A
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Aircraft Aircraft Beneficial Owner
Manufacturer's Operation Lease
Serial Number Agreement Number
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11321 525 Stockholm Aircraft
Finance II B.V.
11323 524 Stockholm Aircraft
Finance III B.V.
11329 135 Stockholm Aircraft
Finance X X.X.
00000 000 Xxxxxxxxx Aircraft
Finance V B.V.
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