1
EXHIBIT 10.112
EXECUTION COPY
$175,000,000
ATLAS AIR, INC.
9 1/4% SENIOR NOTES DUE 2008
PLACEMENT AGREEMENT
April 7, 1998
2
April 7, 1998
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
BT Alex. ▇▇▇▇▇ Incorporated
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs and Mesdames:
ATLAS AIR, INC., a Delaware corporation (the "COMPANY"), proposes to
issue and sell to the several purchasers named in Schedule I hereto (the
"PLACEMENT AGENTS") $175,000,000 principal amount of its 9 1/4% Senior Notes due
2008 (the "SECURITIES") to BE issued pursuant to the provisions of an Indenture
to be dated as of April 9, 1998 (the "INDENTURE") between the Company and State
Street Bank and Trust Company, as Trustee (the "TRUSTEE").
The Securities will be offered without being registered under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), to qualified
institutional buyers in compliance with the exemption from registration provided
by Rule 144A under the Securities Act, in offshore transactions in reliance on
Regulation S under the Securities Act ("REGULATION S") and to institutional
accredited investors (as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act) that deliver a letter in the form annexed to the Memorandum (as
defined below).
The Placement Agents and their direct and indirect transferees will
be entitled to the benefits of a Registration Rights Agreement dated the date
hereof between the Company and the Placement Agents (the "REGISTRATION RIGHTS
AGREEMENT").
In connection with the sale of the Securities, the Company will
prepare an offering memorandum (the "MEMORANDUM") including a description of the
terms of the Securities, the terms of the offering and a description of the
Company. As used herein, the term "Memorandum" shall include in each case the
documents incorporated by reference therein. The terms "SUPPLEMENT," "AMENDMENT"
and "AMEND" as used herein with respect to the Memorandum shall include all
documents deemed to be incorporated by reference in the Memorandum that are
filed subsequent to the date of such Memorandum with the Securities and Exchange
Commission (the "COMMISSION") pursuant to the Securities Exchange Act of 1934,
as amended (the "EXCHANGE ACT").
1. Representations and Warranties. (a) The Company represents and
warrants to, and agrees with, each Placement Agent that:
3
2
(i) (A) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Memorandum complied or
will comply when so filed in all material respects with the Exchange Act
and the applicable rules and regulations of the Commission thereunder and
(B) the Memorandum, in the form used by the Placement Agents to confirm
sales and on the Closing Date (as defined in Section 4), will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding
sentence does not apply to statements in or omissions from the Memorandum
based upon written information furnished to the Company by any Placement
Agent through ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇")
expressly for use therein. The Company hereby confirms that it has
authorized the use of the Memoranda in connection with the offer and
resale of the Securities by the Placement Agents.
(ii) The Company has been duly incorporated, is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Memorandum and to perform
its obligations under this Agreement, the Indenture, the Registration
Rights Agreement and the Securities; the Company is duly qualified to
transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be
so qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole (an "ATLAS
MATERIAL ADVERSE EFFECT").
(iii) The Company's only subsidiaries are Atlas One, Inc., Atlas
Freighter Leasing, Inc., Atlas Freighter Leasing II, Inc., Atlas Air
Services Limited, LHC Properties, Inc., Atlas Flightlease, Inc. and
Genessee Insurance Company, Ltd. (collectively, the "SUBSIDIARIES"). Each
Subsidiary is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation with
corporate power and authority under such laws to own, lease and operate
its properties and conduct its business; and each Subsidiary is duly
qualified to transact business as a foreign corporation and is in good
standing in each other jurisdiction in which it owns or leases property of
a nature, or transacts business of a type, that would make such
qualification necessary, except to the extent that the failure to so
qualify or be in good standing would not have an Atlas Material Adverse
Effect. All of the outstanding shares of capital stock of each Subsidiary
have been duly authorized and validly issued and are fully paid and
non-assessable and are owned by the Company free and clear of any pledge,
lien, security interest, charge, claim, equity or encumbrance of any kind.
4
3
(iv) This Agreement has been duly authorized, executed and delivered
by the Company.
(v) The Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Placement Agents in accordance with the
terms of this Agreement, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and general principles of equity, and will be entitled to the
benefits of the Indenture and the Registration Rights Agreement.
(vi) The Indenture has been duly authorized and, when executed and
delivered by the Company, will be a valid and binding agreement of the
Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and general principles of equity.
(vii) The Registration Rights Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the
Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and general principles of equity and except as rights to
indemnification and contribution under the Registration Rights Agreement
may be limited under applicable law.
(viii) The execution and delivery by the Company of this Agreement,
the Indenture, the Registration Rights Agreement and the Securities, the
consummation by the Company of the transactions contemplated in this
Agreement, the Indenture, the Registration Rights Agreement and the
Securities, and compliance by the Company with the terms of this
Agreement, the Indenture, the Registration Rights Agreement and the
Securities will not contravene (A) the certificate of incorporation or
by-laws of the Company, (B) any provision of applicable law or any
agreement or other instrument binding upon the Company or any of the
Subsidiaries, except for such contraventions as would not, singly or in
the aggregate, have an Atlas Material Adverse Effect, or (C) any judgment,
order or decree of any governmental body, agency or court having
jurisdiction over the Company or any Subsidiary, and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the valid authorization, execution, delivery and
performance by the Company of this Agreement, the Indenture, the
Registration Rights Agreement and the Securities, or the consummation by
the Company of the transactions contemplated by this Agreement, the
Indenture, the Registration Rights Agreement and the Securities, except
(x) such as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the Securities and
(y) such as may be
5
4
required under the Securities Act, the Trust Indenture Act or rules of the
National Association of Securities Dealers in connection with the
registration of the Securities under the Securities Act pursuant to the
Registration Rights Agreement.
(ix) The Company is a "CITIZEN OF THE UNITED STATES" (as defined in
Section 40102(a)(15) of Title 49 of the United States Code, as amended)
and is an air carrier operating under a certificate issued by the
Secretary of Transportation pursuant to Chapter 447 of Title 49, United
States Code, for aircraft capable of carrying 10 or more individuals or
6,000 pounds or more of cargo. There is in force with respect to the
Company an air carrier operating certificate issued pursuant to Part 121
of the regulations under the sections of ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code,
relating to aviation (the "FEDERAL AVIATION ACT"). All of the outstanding
shares of capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable
(x) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and the Subsidiaries, taken as a whole, from
that set forth in the Memorandum.
(xi) Except as accurately described in all material respects in the
Memorandum and except as would not have an Atlas Material Adverse Effect
and would not materially and adversely affect the ability of the Company
to perform its obligations under this Agreement, the Indenture, the
Registration Rights Agreement and the Securities, or to consummate the
transactions contemplated by the Memorandum, there are no legal or
governmental proceedings pending or, to the best knowledge of the Company,
threatened to which the Company or any of the Subsidiaries is or may be a
party or to which any of the properties of the Company or any of the
Subsidiaries is or may be subject.
(xii) Except as described in the Memorandum, the Company is not in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which it is a
party or by which it may be bound or to which any of its properties may be
subject, except for such defaults that would not have an Atlas Material
Adverse Effect.
(xiii) The Company and the Subsidiaries each has good and marketable
title to all properties and assets described in the Memorandum as owned by
it, free and clear of all liens, charges, encumbrances or restrictions,
except (A) as described in the Memorandum or (B) as would not have an
Atlas Material Adverse Effect.
6
5
(xiv) Except as described in the Memorandum, no labor problem exists
with the Company's employees or with employees of any Subsidiary or, to
the best knowledge of the Company, is imminent that could reasonably be
expected to have an Atlas Material Adverse Effect, and the Company is not
aware of any existing or imminent labor disturbance by the employees of
any of its or any subsidiary's principal contractors or customers that
could reasonably be expected to have an Atlas Material Adverse Effect.
(xv) The Company and the Subsidiaries (A) are in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("ENVIRONMENTAL LAWS"), (B) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (C) are in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance with Environmental Laws, failure to receive required
permits, licenses or other approvals or failure to comply with the terms
and conditions of such permits, licenses or approvals would not, singly or
in the aggregate, have an Atlas Material Adverse Effect.
(xvi) Neither the Company nor any affiliate (as defined in Rule
501(b) of Regulation D under the Securities Act, an "AFFILIATE") of the
Company has directly, or through any agent, (A) sold, offered for sale,
solicited offers to buy or otherwise negotiated in respect of, any
security (as defined in the Securities Act) which is or will be integrated
with the sale of the Securities in a manner that would require the
registration under the Securities Act of the Securities or (B) engaged in
any form of general solicitation or general advertising in connection with
the offering of the Securities (as those terms are used in Regulation D
under the Securities Act) or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act. The Company has
not entered and will not enter into any contractual arrangement with
respect to the distribution of the Securities, except for this Agreement.
(xvii) None of the Company, its Affiliates or any person acting on
its or their behalf (other than the Placement Agents, as to which the
Company makes no representation) has engaged in any directed selling
efforts (as that term is defined in Regulation S under the Securities Act
("REGULATION S")) with respect to the Securities and the Company and its
Affiliates and any person acting on its or their behalf (other than the
Placement Agents as to which the Company makes no representation) have
complied and will comply with the offering restrictions requirement of
Regulation S.
(xviii) The Company is subject to Section 13 or 15(d) of the
Securities
7
6
Exchange Act of 1934, as amended (the "EXCHANGE ACT").
(xix) The Securities satisfy the eligibility requirements of Rule
144A(d)(3) under the Securities Act.
(xx) It is not necessary in connection with the offer, sale and
delivery of the Securities to the Placement Agents pursuant to this
Agreement to register the Securities under the Securities Act or to
qualify the Indenture under the Trust Indenture Act of 1939, as amended
(the "TRUST INDENTURE ACT").
(xxi) The Company is not, and after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof as
described in the Memorandum, will not be an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(xxii) The Securities conform in all material respects to the
description thereof contained in the Memorandum under the heading
"Description of the Notes."
(xxiii) The accountants that examined and issued an auditors report
with respect to the consolidated financial statements of the Company and
its consolidated subsidiaries included or incorporated by reference in the
Memorandum are independent public accountants within the meaning of the
Securities Act and the regulations thereunder.
(xxiv) The consolidated financial statements included or
incorporated by reference in the Memorandum present fairly the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the consolidated results of
operations and cash flows or changes in financial position of the Company
and its consolidated subsidiaries for the periods specified. Such
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the periods involved. The financial statement schedules, if any, included
or incorporated by reference in the Memorandum present fairly the
information required to be stated therein.
(xxv) The Company and the Subsidiaries possess adequate
certificates, authorities and permits issued by appropriate governmental
agencies or bodies necessary to conduct, in all material respects, the
business now operated by them and have not received any notice of
proceedings relating to the revocation or modification of any such
certificate, authority or permit that would, individually or in the
aggregate, have an Atlas Material Adverse Effect.
8
7
(xxvi) The statistical and market-related data included in the
Memorandum are based on or derived from sources which the Company and the
Subsidiaries believe to be reliable and accurate.
(xxvii) None of the Company, the Subsidiaries or any agent acting on
their behalf has taken or will take any action that might cause this
Agreement or the sale of the Securities to violate Regulation T, U or X of
the Board of Governors of the Federal Reserve System, in each case as in
effect, or as the same may hereafter be in effect, on the Closing Date.
(xxviii) Each of the Company and the Subsidiaries carries insurance
in such amounts and covering such risks as it deems reasonable for the
conduct of its business and the value of its properties.
(xxix) No holder of securities of the Company or any Subsidiary will
be entitled to have such securities registered under the registration
statements required to be filed by the Company pursuant to the
Registration Rights Agreement other than as expressly permitted thereby.
(xxx) Neither the Company nor any of its Subsidiaries nor, to the
Company's knowledge, any officer or director purporting to act on behalf
of the Company or any of its Subsidiaries has at any time: (A) violated or
is in violation of any provision of the Foreign Corrupt Practices Act of
1977 or (B) engaged in any transactions, maintained any bank account or
used any corporate funds except for transactions, bank accounts and funds
which have been and are reflected in the normally maintained books and
records of the Company and its Subsidiaries.
(b) The parties agree that any certificate signed by a duly
authorized officer of the Company and delivered to a Placement Agent, or to
counsel for the Placement Agents, on the Closing Date and in connection with
this Agreement or the offering of the Securities, shall be deemed a
representation and warranty by (and only by) the Company to the Placement Agents
as to the matters covered thereby.
The representations and warranties contained in this Agreement shall
be true and correct as of the date of this Agreement and as of the Closing Date.
2. Agreements to Sell and Purchase. The Company hereby agrees to
sell to the several Placement Agents, and each Placement Agent, upon the basis
of the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees, severally and not jointly, to purchase
from the Company the respective principal amount of Securities set forth in
Schedule I hereto opposite its name at a purchase price of 96.867% of
9
8
the principal amount thereof (the "PURCHASE PRICE") plus accrued interest, if
any, to the Closing Date.
The Company hereby agrees that, without the prior written consent of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ on behalf of the Placement Agents, it will not, during the period
beginning on the date hereof and continuing to and including the Closing Date,
offer, sell, contract to sell or otherwise dispose of any debt of the Company or
warrants to purchase debt of the Company substantially similar to the
Securities, other than (i) the sale of the Securities under this Agreement and
(ii) commercial paper issued in the ordinary course of business.
3. Terms of Offering. You have advised the Company that the
Placement Agents will make an offering of the Securities purchased by the
Placement Agents hereunder on the terms to be set forth in the Memorandum, as
soon as practicable after this Agreement is entered into as in your judgment is
advisable.
4. Payment and Delivery. Payment for the Securities shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Securities for the respective accounts of the several
Placement Agents at a closing to be held at the offices of Shearman & Sterling,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, at 10:00 a.m., New York City time, on
April 9, 1998, or at such other time on the same or such other date, not later
than April 23, 1998, as shall be designated in writing by you. The time and date
of such payment are hereinafter referred to as the "CLOSING DATE."
Certificates for the Securities shall be in definitive form or
global form, as specified by you, and registered in such names and in such
denominations as you shall request in writing not later than one full business
day prior to the Closing Date. The certificates evidencing the Securities shall
be delivered to you on the Closing Date for the respective accounts of the
several Placement Agents, with any transfer taxes payable in connection with the
transfer of the Securities to the Placement Agents duly paid, against payment of
the Purchase Price therefor plus accrued interest, if any, to the date of
payment and delivery.
5. Conditions to the Placement Agents' Obligations. The several
obligations of the Placement Agents to purchase and pay for the Securities on
the Closing Date are subject to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the
direction of the possible
10
9
change, in the rating accorded any of the Company's securities,
including the Securities, by any "nationally recognized statistical
rating organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that set
forth in the Memorandum (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your
judgment, impracticable to market the Securities on the terms and in
the manner contemplated in the Memorandum.
(b) You shall have received on the Closing Date a certificate, dated
the Closing Date and signed by an executive officer of the Company, to the
effect set forth in clause (a)(i) above and to the effect that the
representations and warranties of the Company contained in this Agreement
are true and correct as of the Closing Date and that the Company has
complied with all of the agreements and satisfied all of the conditions on
its part to be performed or satisfied on or before the Closing Date.
The officer signing and delivering such certificate may rely upon
the best of his knowledge as to proceedings threatened.
(c) At the Closing Date, the Registration Rights Agreement, attached
as Exhibit A hereto, shall have been duly executed, delivered and be in
full force and effect.
(d) On the Closing Date, The Indenture shall have been duly executed
and delivered and be in full force and effect.
(e) On the Closing Date, you shall have received an opinion of
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, as counsel for the Company, dated the Closing
Date, to the effect set forth in Exhibit B hereto.
(f) On the Closing Date, you shall have received an opinion of ▇▇▇▇▇
▇▇▇▇▇▇▇▇, in-house legal counsel of the Company, dated the Closing Date,
to the effect set forth in Exhibit C hereto.
(g) On the Closing Date, you shall have received an opinion of
Shearman & Sterling, counsel for the Placement Agents, dated the Closing
Date, in form and substance satisfactory to you.
11
10
(h) You shall have received on each of the date hereof and the
Closing Date a letter, dated the date hereof or the Closing Date, as
the case may be, in form and substance satisfactory to you, from the
Company's independent public accountants, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Memorandum; provided,
that the letter delivered on the Closing Date shall use a "cut-off
date" not earlier than the date hereof.
(i) The Company shall have furnished to you and to counsel for
the Placement Agents, in form and substance satisfactory to you, such
other documents, certificates and opinions as such counsel may
reasonably request in order to pass upon the matters referred to in
Section 5(d) and in order to evidence the accuracy and completeness of
any of the representations, warranties or statements, the performance
of any covenant by the Company theretofore to be performed, or the
compliance with any of the conditions herein contained.
(j) On or before the Closing Date, the Company shall have
furnished the Placement Agents with such conformed copies of such
opinions, certificates, letters and documents as the Placement Agents
may reasonably request.
6. Covenants of the Company. In further consideration of the agreements
of the Placement Agents contained in this Agreement, the Company covenants with
each Placement Agent as follows:
(a) To furnish to each Placement Agent in New York City,
without charge, prior to 10:00 a.m., New York City time, on the
business day next succeeding the date of this Agreement and during the
period mentioned in Section 6(c), as many copies of the Memorandum, any
documents incorporated by reference therein and any supplements and
amendments thereto as such Placement Agent may reasonably request.
(b) Before amending or supplementing the Memorandum, to
furnish to you a copy of each such proposed amendment or supplement and
not to use any such proposed amendment or supplement to which you
reasonably object.
(c) If, during such period after the date hereof and prior to
the date on which all of the Securities shall have been sold by the
Placement Agents, any event shall occur or condition exist as a result
of which it is necessary to amend or supplement the Memorandum in order
to make the statements therein, in the light of the circumstances when
the Memorandum is delivered to a purchaser, not misleading, or if, in
the opinion of counsel for the Placement Agents, it is necessary to
amend or supplement the Memorandum to comply with applicable law,
forthwith to prepare and
12
11
furnish, at its own expense, to the Placement Agents, either
amendments or supplements to the Memorandum so that the statements in
the Memorandum as so amended or supplemented will not, in the light of
the circumstances when the Memorandum is delivered to a purchaser, be
misleading or so that the Memorandum, as so amended or supplemented,
will comply with applicable law.
(d) To endeavor to qualify the Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions as you
shall reasonably request.
(e) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including: (i) the fees,
disbursements and expenses of the Company's counsel and the Company's
accountants in connection with the issuance and sale of the Securities
and all other fees or expenses in connection with the preparation of
the Memorandum and all amendments and supplements thereto, including
all printing costs associated therewith, and the delivering of copies
thereof to the Placement Agents, in the quantities herein above
specified, (ii) all costs and expenses related to the transfer and
delivery of the Securities to the Placement Agents, including any
transfer or other taxes payable thereon, (iii) the cost of printing or
producing any Blue Sky or legal investment memorandum in connection
with the offer and sale of the Securities under state securities laws
and all expenses in connection with the qualification of the Securities
for offer and sale under state securities laws as provided in Section
6(d) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Placement Agents in connection with
such qualification and in connection with the Blue Sky or legal
investment memorandum, (iv) any fees charged by rating agencies for the
rating of the Securities, (v) the fees and expenses, if any, incurred
in connection with the admission of the Securities for trading in
PORTAL or any appropriate market system, (vi) the costs and charges of
the Trustee (including the reasonable fees and disbursements of counsel
to the Trustee) and any transfer agent, registrar or depositary, (vii)
the cost of the preparation, issuance and delivery of the Securities,
(viii) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the
marketing of the offering of the Securities, including, without
limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of
the Company, travel and lodging expenses of the representatives and
officers of the Company and any such consultants, and the cost of any
aircraft chartered in connection with the road show, and (ix) all other
costs and expenses incident to the performance of the obligations of
the Company hereunder for which provision is not otherwise made in this
Section. It is understood, however, that except as provided in this
Section, Section 8, and the last paragraph of
13
12
Section 10, the Placement Agents will pay all of their costs and
expenses, including fees and disbursements of their counsel, transfer
taxes payable on resale of any of the Securities by them and any
advertising expenses connected with any offers they may make.
(f) Neither the Company nor any Affiliate will sell, offer for
sale or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in the Securities Act) which could be integrated
with the sale of the Securities in a manner which would require the
registration under the Securities Act of the Securities.
(g) Not to solicit any offer to buy or offer or sell the
Securities by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act.
(h) While any of the Securities remain "restricted securities"
within the meaning of the Securities Act, to make available, upon
request, to any seller of the Securities the information specified in
Rule 144A(d)(4) under the Securities Act, unless the Company is then
subject to Section 13 or 15(d) of the Exchange Act.
(i) If requested by you, to use its best efforts to permit the
Securities to be designated PORTAL securities in accordance with the
rules and regulations adopted by the National Association of Securities
Dealers, Inc. relating to trading in the PORTAL Market.
(j) None of the Company, its Affiliates or any person acting
on its or their behalf (other than the Placement Agents, as to whom the
Company makes no covenant, as to whom the Company makes no covenant
will engage in any directed selling efforts (as that term is defined in
Regulation S) with respect to the Securities, and the Company and its
Affiliates and each person acting on its or their behalf (other than
the Placement Agents, as to whom the Company makes no covenant) will
comply with the offering restrictions requirement of Regulation S.
(k) During the period of two years after the Closing Date, the
Company will not, and will not permit any of its affiliates (as defined
in Rule 144 under the Securities Act) to, resell any of the Securities
which constitute "restricted securities" under Rule 144 that have been
reacquired by any of them.
(l) For a period of three years after the Closing Date, to
make available to the Placement Agents, copies of all annual reports,
quarterly reports and current reports filed by the Company with the
Commission on Forms 10-K, 10-Q and 8-K, or such
14
13
other similar forms as may be designated by the Commission, and such
other \ documents, reports and information as shall be furnished by the
Company to the holders of Securities or to its security holders
generally; provided that at such time the Company has securities
registered under Section 12(b) or 12(g) of the Exchange Act.
(m) During the period of two years after the Closing Date,
upon request, to furnish to the Placement Agents and any holder of
Securities a copy of the restrictions on transfer applicable to the
Offered Certificates.
(n) During the period of two years after the Closing Date, not
to be or become an open-end investment company, unit investment trust
or face-amount certificate company that is or is required to be
registered under Section 8 of the Investment Company Act, or a
closed-end investment company required to be registered, but not
registered, under the Investment Company Act.
(o) In connection with the offering, until the Placement
Agents shall have notified the Company of the completion of the resale
of the Securities, neither the Company nor any of its Affiliates has
bid for or purchased or will bid for or purchase, either alone or with
one or more other persons, for any account in which it or any of its
affiliates has a beneficial interest any Securities; and neither it nor
any of its affiliates will make bids or purchases for the purpose of
creating actual, or apparent, active trading in, or of raising the
price of, the Securities.
(p) The Company will apply the net proceeds from the sale of
the Notes as set forth under "Use of Proceeds" in the Memorandum.
7. Offering of Securities; Restrictions on Transfer. (a) Each
Placement Agent, severally and not jointly, represents and warrants
that such Placement Agent is a qualified institutional buyer as defined
in Rule 144A under the Securities Act (a "QIB"). Each Placement Agent,
severally and not jointly, agrees with the Company that (i) it will not
solicit offers for, or offer or sell, such Securities by any form of
general solicitation or general advertising (as those terms are used in
Regulation D under the Securities Act) or in any manner involving a
public offering within the meaning of Section 4(2) of the Securities
Act and (ii) it will solicit offers for such Securities only from, and
will offer such Securities only to, persons that it reasonably believes
to be (A) in the case of offers inside the United States, (x) QIBs or
(y) other institutional accredited investors (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act ("INSTITUTIONAL
ACCREDITED INVESTORS") that, prior to their purchase of the Securities,
deliver to such Placement Agent a letter containing the representations
and agreements set forth in Appendix A to the Memorandum and (B) in the
case of offers outside the United States, to persons other than U.S.
persons ("FOREIGN PURCHASERS,"
15
14
which term shall include dealers or other professional fiduciaries in
the United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)) in reliance upon
Regulation S under the Securities Act that, in each case, in purchasing
such Securities are deemed to have represented and agreed as provided
in the Memorandum under the caption "Transfer Restrictions."
(b) Each Placement Agent, severally and not jointly, represents,
warrants, and agrees with respect to offers and sales outside the United States
that:
(i) such Placement Agent understands that no action has been
or will be taken in any jurisdiction by the Company that would permit a
public offering of the Securities, or possession or distribution of the
Memorandum or any other offering or publicity material relating to the
Securities, in any country or jurisdiction where action for that
purpose is required;
(ii) such Placement Agent will comply with all applicable laws
and regulations in each jurisdiction in which it acquires, offers,
sells or delivers Securities or has in its possession or distributes
the Memorandum or any such other material, in all cases at its own
expense;
(iii) the Securities have not been registered under the
Securities Act and may not be offered or sold within the United States
or to, or for the account or benefit of, U.S. persons except in
accordance with Rule 144A or Regulation S under the Securities Act or
pursuant to another exemption from the registration requirements of the
Securities Act;
(iv) such Placement Agent has offered the Securities and will
offer and sell the Securities (A) as part of their distribution at any
time and (B) otherwise until 40 days after the later of the
commencement of the offering and the Closing Date, only in accordance
with Rule 903 of Regulation S or as otherwise permitted in Section
7(a); accordingly, neither such Placement Agent, its Affiliates nor any
persons acting on its or their behalf have engaged or will engage in
any directed selling efforts (within the meaning of Regulation S) with
respect to the Securities, and any such Placement Agent, its Affiliates
and any such persons have complied and will comply with the offering
restrictions requirement of Regulation S;
(v) such Placement Agent has (A) not offered or sold and,
prior to the date six months after the Closing Date, will not offer or
sell any Securities to persons in the United Kingdom except to persons
whose ordinary activities involve them in acquiring, holding, managing
or disposing of investments (as principal or agent) for the purposes of
their businesses or otherwise in circumstances which have not resulted
and will not
16
15
result in an offer to the public in the United Kingdom within the
meaning of the Public Offers of Securities Regulations 1995; (B)
complied and will comply with all applicable provisions of the
Financial Services ▇▇▇ ▇▇▇▇ with respect to anything done by it in
relation to the Securities in, from or otherwise involving the United
Kingdom, and (C) only issued or passed on and will only issue or pass
on in the United Kingdom any document received by it in connection with
the issue of the Securities to a person who is of a kind described in
Article 11(3) of the Financial Services ▇▇▇ ▇▇▇▇ (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such
document may otherwise lawfully be issued or passed on;
(vi) such Placement Agent understands that the Securities have
not been and will not be registered under the Securities and Exchange
Law of Japan, and represents that it has not offered or sold, and
agrees not to offer or sell, directly or indirectly, any Securities in
Japan or for the account of any resident thereof except pursuant to any
exemption from the registration requirements of the Securities and
Exchange Law of Japan and otherwise in compliance with applicable
provisions of Japanese law; and
(vii) such Placement Agent agrees that, at or prior to
confirmation of sales of the Securities, it will have sent to each
distributor, dealer or person receiving a selling concession, fee or
other remuneration that purchases Securities from it during the
restricted period a confirmation or notice to substantially the
following effect:
"The Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Securities Act") and may not be
offered and sold within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of their distribution at any time
or (ii) otherwise until 40 days after the later of the commencement of
the offering and the closing date, except in either case in accordance
with Regulation S (or Rule 144A if available) under the Securities Act.
Terms used above have the meaning given to them by Regulation S."
Terms used in this Section 7(b) have the meanings given to them by Regulation S.
8. Indemnity and Contribution. (a) The Company agrees to
indemnify and hold harmless each Placement Agent and each person, if any, who
controls any Placement Agent within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, or is under common control
with, or is controlled by, such Placement Agent, from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Memorandum (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto), by any
17
16
omission or alleged omission to state therein a material fact necessary to make
the statements therein in the light of the circumstances under which they were
made not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Placement
Agent furnished to the Company in writing by such Placement Agent through ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated expressly for use therein.
(b) Each Placement Agent agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers and each
person, if any, who controls the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent as
the foregoing indemnity from the Company to such Placement Agent, but only with
reference to information relating to such Placement Agent furnished to the
Company in writing by such Placement Agent through ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated expressly for use in the Memorandum or any amendments or
supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 8(a) or 8(b), such person (the "INDEMNIFIED PARTY")
shall promptly notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PARTY") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, in the case of
parties indemnified pursuant to Section 8(a), and by the Company, in the case of
parties indemnified pursuant to Section 8(b). The indemnifying party shall not
be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified
18
17
party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 60 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) To the extent the indemnification provided for in Section 8(a) or
8(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Placement Agents on the
other hand from the offering of the Securities or (ii) if the allocation
provided by clause 8(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 8(d)(i) above but also the relative fault of the Company on the one
hand and of the Placement Agents on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Placement
Agents on the other hand in connection with the offering of the Securities shall
be deemed to be in the same respective proportions as the net proceeds from the
offering of the Securities (before deducting expenses) received by the Company
and the total discounts and commissions received by the Placement Agents in
respect thereof, bear to the aggregate offering price of the Securities. The
relative fault of the Company on the one hand and of the Placement Agents on the
other hand shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or by the Placement Agents and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Placement Agents' respective obligations to contribute pursuant to this
Section 8 are several in proportion to the respective principal amount of
Securities they have purchased hereunder, and not joint.
(e) The Company and the Placement Agents agree that it would not be
just or equitable if contribution pursuant to this Section 8 were determined by
pro rata allocation
19
18
(even if the Placement Agents were treated as one entity for such purpose) or by
any other method of allocation that does not take account of the equitable
considerations referred to in Section 8(d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages and liabilities
referred to in Section 8(d) shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8, no Placement
Agent shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities resold by it in the initial
placement of such Securities were offered to investors exceeds the amount of any
damages that such Placement Agent has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 8 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law or in
equity.
(f) The indemnity and contribution provisions contained in this Section
8 and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Placement Agent or any person controlling any Placement
Agent or by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Securities.
9. Termination. This Agreement shall be subject to termination
by notice given by you to the Company, if (a) after the execution and delivery
of this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange, the National Association
of Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse and (b) in the case of any of
the events specified in clauses 9(a)(i) through 9(a)(iv), such event, singly or
together with any other such event, makes it, in your judgment, impracticable to
market the Securities on the terms and in the manner contemplated in the
Memorandum.
10. Effectiveness. This Agreement shall become effective upon
the
20
19
execution and delivery hereof by the parties hereto.
If this Agreement shall be terminated by the Placement Agents,
or any of them, because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement, the Company will reimburse the Placement Agents or such
Placement Agents as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
disbursements of their counsel) reasonably incurred by such Placement Agents in
connection with this Agreement or the offering contemplated hereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and mailed, delivered or sent by facsimile
transmission to: if sent to the Placement Agents, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention: High Yield New
Issues Group, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇ and if sent to the Company, to
Atlas Air, Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention: Chief
Financial Officer, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇.
12. Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
13. Headings. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
21
20
14. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
Very truly yours,
ATLAS AIR, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Vice President --
Strategic Planning and
Treasurer
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
BT ALEX. ▇▇▇▇▇ INCORPORATED
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
22
SCHEDULE I
Principal Amount of
PLACEMENT AGENT Securities to be Purchased
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated....................... $87,500,000
BT Alex. ▇▇▇▇▇ Incorporated............................. 87,500,000
Total:.................................................. $175,000,000
23
EXHIBIT A
FORM OF REGISTRATION RIGHTS AGREEMENT
24
EXHIBIT B
FORM OF OPINION OF ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
COUNSEL TO THE COMPANY
25
EXHIBIT C
FORM OF OPINION OF ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, IN-HOUSE LEGAL COUNSEL
TO THE COMPANY
