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EXHIBIT 4.18
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Aircraft N398UA
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SECOND AMENDMENT TO PARTICIPATION AGREEMENT
(1994 737 B)
Dated as of December 23, 1997
Among
UNITED AIR LINES, INC.,
Lessee,
MS FINANCING INC.,
Owner Participant,
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity,
except as expressly provided herein,
but solely as Owner Trustee,
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
in its individual capacity and as Indenture Trustee
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
in its capacity as Pass Through Trustee under
each of the four separate Pass Through Trust Agreements
and
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
as Subordination Agent
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United Air Lines, Inc.
1994 737 B Equipment Trust
One Boeing 737-322 Aircraft
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SECOND AMENDMENT TO PARTICIPATION AGREEMENT
(1994 737 B)
THIS SECOND AMENDMENT TO PARTICIPATION AGREEMENT (1994 737 B) dated as
of December 23, 1997 (this "Amendment") among (i) UNITED AIR LINES, INC., a
Delaware corporation (the "Lessee"), (ii) MS FINANCING INC., a Delaware
corporation (the "Owner Participant"), (iii) STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking association (as
assignee of the Original Owner Trustee (as defined below)), not in its
individual capacity, except as expressly provided herein, but solely as Owner
Trustee under the Trust Agreement (the "Owner Trustee"), (iv) FIRST SECURITY
BANK, NATIONAL ASSOCIATION, a national banking association (as assignee of the
Original Indenture Trustee (as defined below)), in its individual capacity and
as Indenture Trustee under the Trust Indenture (the "Indenture Trustee"), (v)
FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, in
its capacity as Pass Through Trustee (the "Pass Through Trustee") under each of
the four separate Pass Through Trust Agreements and (vi) FIRST SECURITY BANK,
NATIONAL ASSOCIATION, a national banking association, as Subordination Agent
acting on behalf of the Pass Through Trustees (the "Subordination Agent"),
amends that certain Participation Agreement (1994 737 B) dated as of September
1, 1994 (the "Original Participation Agreement") among Lessee, the Owner
Participant, the Original Loan Participants referred to therein, First Security
Bank, National Association (formerly known as First Security Bank of Utah,
National Association), not in its individual capacity except as expressly
provided therein but solely as owner trustee under the Trust Agreement (the
"Original Owner Trustee") and State Street Bank and Trust Company, as Indenture
Trustee (the "Original Indenture Trustee"), as amended by that certain First
Amendment to Participation Agreement (1994 737 B) dated January 26, 1996 (the
"First Amendment") among Lessee, the Owner Participant, the Original Owner
Trustee, the Original Loan Participants referred to therein and the Original
Indenture Trustee (the Original Participation Agreement, as amended by the First
Amendment, being referred to herein collectively as the "Participation
Agreement").
WITNESSETH:
WHEREAS, except as otherwise defined in this Amendment, capitalized
terms used herein shall have the meanings attributed thereto in the
Participation Agreement; and
WHEREAS, pursuant to that certain Assignment and Assumption Agreement
(1994 737 B) dated as of December 11, 1997, between the Owner Trustee and the
Original Owner Trustee, the Original Owner Trustee assigned to the Owner
Trustee, and the Owner Trustee assumed, all of the obligations of the Original
Owner Trustee under the Trust Agreement, which obligations are guaranteed by the
Owner Trustee Parent pursuant to the terms of the Owner Trustee Parent Guaranty
(as such terms are defined in the Lease); and
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[Second Amendment to Participation Agreement (1994 737 B)]
WHEREAS, pursuant to that certain Assignment and Assumption Agreement
(1994 737 B) dated as of December 11, 1997 between the Indenture Trustee and the
Original Indenture Trustee, the Original Indenture Trustee assigned to the
Indenture Trustee, and the Indenture Trustee assumed from the Original Indenture
Trustee, all of the rights and interests of the Original Indenture Trustee under
the Trust Indenture and the other Operative Documents; and
WHEREAS, concurrently with the execution of this Amendment, the
Certificates held by the Original Loan Participants are being refinanced by the
issuance of new Equipment Notes issued to the Subordination Agent on behalf of
the Pass Through Trustees under each of the four separate Pass Through Trust
Agreements; and
WHEREAS, in connection with the refinancing of the outstanding
Certificates the parties hereto desire to amend the Participation Agreement in
certain respects.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
SECTION 1. Amendment to Schedule I. Schedule I to the Participation
Agreement is hereby deleted in its entirety and replaced with Schedule I to this
Amendment.
SECTION 2. Amendment to Section 5. The first sentence of Section 5 of
the Participation Agreement is hereby amended to be and read in its entirety as
follows:
"Lessor, the Participants, the Pass Through Trustees and the
Indenture Trustee shall keep the Purchase Agreement confidential and
shall not disclose or cause to be disclosed the same to any Person,
except (A) to prospective and permitted transferees of Lessor's, the
Original Loan Participant's, the Owner Participant's, a Pass Through
Trustee's or the Indenture Trustee's interest who agree to hold such
information confidential, (B) to the aforementioned prospective and
permitted transferees', Lessor's, the Original Loan Participant's, the
Owner Participant's, a Pass Through Trustee's or the Indenture
Trustee's counsel or special counsel, independent insurance brokers or
other agents who agree to hold such information confidential, (C) as
may be required by any statute, court or administrative order or
decree (including in connection with discovery proceedings) or
governmental ruling or regulation, including Federal or state banking
examiners or tax auditors or (D) as may be necessary or desirable for
purposes of protecting the interest of any such Person or for
enforcement of the Lease by Lessor, the Participants, any Pass Through
Trustee or the Indenture Trustee; provided, however, that any and all
disclosures of all or any part of the Purchase Agreement which are
permitted by clause (C) or (D) above shall be made only to the extent
necessary to meet
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[Second Amendment to Participation Agreement (1994 737 B)]
the specific requirements or needs of the Persons to whom such
disclosures are hereby permitted."
SECTION 3. Amendment to Section 6. Section 6 of the Participation
Agreement is hereby amended to be and read in its entirety as follows:
"SECTION 6. Extent of Interest of Noteholders. No Noteholder shall
have any further interest in, or other right with respect to, the mortgage
and security interests created by the Trust Indenture when and if the
principal amount of, Break Amount, if any, Make-Whole Amount, if any, and
interest on all Equipment Notes held by such Noteholder and all other
Secured Obligations payable to such Noteholder or the Indenture Trustee
hereunder, under the Trust Indenture, under such Equipment Notes and under
the other Operative Documents shall have been paid in full. Each Noteholder
by its acceptance of an Equipment Note, agrees that it will look solely to
the income and proceeds from the Indenture Estate to the extent available
for distribution to such Noteholder as provided in Section 2.09 of the
Trust Indenture and that neither the Owner Participant nor the Owner
Trustee shall be personally liable to any Noteholder for any amounts
payable under the Equipment Notes, the Trust Indenture, hereunder, or under
any other Operative Documents (including, without limitation, amounts
payable as Break Amount, if any and Make-Whole Amount, if any), except as
expressly provided in this Agreement or, in the case of the Owner Trustee,
in the Trust Indenture."
SECTION 4. Amendments to Section 7. Section 7 of the Participation
Agreement is hereby amended in the following manner:
(a) Section 7(b) is hereby amended in the following manner:
(i) Section 7(b) is hereby amended such that wherever the
phrase "Operative Documents" is used, such phrase is hereby amended to
be and read in its entirety as follows:
"Operative Documents and/or the other Fundamental
Documents"
(ii) Clause (C) of the third sentence of Section 7(b)(i) is
hereby amended to be and read in its entirety as follows:
"(C) any amount paid or payable pursuant to any
Operative Documents and/or the other Fundamental Documents, or
any document related thereto or the property or the income or
other proceeds with respect to any of the property held in the
Trust Estate or the Indenture
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[Second Amendment to Participation Agreement (1994 737 B)]
Estate or the property held by each Pass Through Trustee under
the respective Pass Through Trust Agreement,"
(iii) Clause (E) of the third sentence of Section 7(b)(i) is
hereby amended to be and read in its entirety as follows:
"(E) any or all of the Operative Documents and/or the
other Fundamental Documents, or the issuance of the Equipment
Notes or the Pass Through Certificates (or the refinancing
thereof) and any other documents contemplated hereby or
thereby and amendments and supplements hereto and thereto
which have been approved by Lessee or the execution, delivery,
recording or performance of any thereof or the issuance,
acquisition, holding or subsequent transfer thereof,"
(iv) Clause (F) of the third sentence of Section 7(b)(i) is
hereby amended to be and read in its entirety as follows:
"(F) the payment of the principal amount of, or interest
or Break Amount or Make-Whole Amount on, or other amounts
payable with respect to, the Equipment Notes or the payment of
principal of, interest or Break Amount or Make-Whole Amount on
or any other amounts payable with respect to the Pass Through
Certificates,"
(v) Clause (3) of Section 7(b)(ii) is hereby amended to be and
read in its entirety as follows:
"(3) to any Tax imposed on an Indemnitee which is the
Owner Participant, the Owner Trustee, or the Trust Estate, or
any successor, assign or Affiliate of any thereof, as a result
of a voluntary transfer or disposition by such Indemnitee
including, without limitation, the revocation of the trust
created by the Trust Agreement or an involuntary transfer or
disposition relating to bankruptcy or similar proceedings of
all or any portion of its respective equitable or legal
ownership interest in the Aircraft, the Airframe, the Engines,
the Parts or any part thereof, the Trust Estate or the
Operative Documents, unless such transfer or disposition,
whether or not voluntary or involuntary, shall occur, (A)
during a period when an Event of Default has occurred and is
continuing under the Lease at the time of transfer or
disposition and such transfer is as a result of such Event of
Default, (B) in connection with the termination of the Lease
or action or direction of the Lessee pursuant to Sections 7,
8, 9, 10 or 19 thereof or (C) in connection with a
substitution of the Owner Trustee at the request of the Lessee
with
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[Second Amendment to Participation Agreement (1994 737 B)]
respect to any refinancing described in Section 17 hereof,
including such request made in connection with the refinancing
contemplated by the Second Amendment to Participation
Agreement;"
(vi) Clause (6) of Section 7(b)(ii) is hereby amended to be
and read in its entirety as follows:
"(6) to any Tax imposed on an Indemnitee other than the
Owner Participant, Owner Participant Guarantor, Trust Estate
or Owner Trustee which results from the willful misconduct or
gross negligence of such Indemnitee;"
(vii) Clause (7) of Section 7(b)(ii) is hereby amended to be
and read in its entirety as follows:
"(7) to any Tax based on or measured by any fees
received by the Owner Trustee, the Indenture Trustee, the Pass
Through Trustee or any Liquidity Provider in connection with
any transaction contemplated by the Operative Documents and/or
the other Fundamental Documents;"
(viii) Clause (15) of Section 7(b)(ii) is hereby amended to be
and read in its entirety as follows:
"(15) to any Tax imposed on any Indemnitee as a result
of a "prohibited transaction" as defined in Section 406 of
ERISA or Section 4975 (c) (1) of the Code; provided, however,
that this exception shall not apply to Lessee's obligation
under Section 7(b)(i) to indemnify an Indemnitee (other than
any Noteholder or any holder of Pass Through Certificates or
any Related Indemnitee of any of them), for any Tax (except to
the extent such Tax arises from or is attributable to the
incorrectness of a representation or warranty made by such
Indemnitee) incurred by or asserted against such Indemnitee as
a result of a "prohibited transaction", within the meaning of
Section 406 of ERISA or Section 4975 (c) (1) of the Code, in
any way relating to, resulting from, or arising out of or in
connection with, directly or indirectly, a refinancing
transaction pursuant to Section 17 or 20, the offer, sale,
resale, purchase, delivery or holding of any Pass Through
Certificate, any loan certificate issued under the Original
Indenture or Equipment Note (whether issued pursuant to the
Original Indenture or the Trust Indenture and whether issued
on the Delivery Date or in connection with the refinancing
transaction or otherwise), or any other transaction
contemplated under any Operative Documents and/or the other
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[Second Amendment to Participation Agreement (1994 737 B)]
Fundamental Documents whether such prohibited transaction
occurs before, on or after the Delivery Date."
(b) Section 7(c) of the Participation Agreement shall be amended in the
following manner:
(i) Section 7(c) is hereby amended such that wherever the
phrase "Operative Documents" is used, such phrase is hereby amended to
be and read in its entirety as follows:
"Operative Documents and/or the other Fundamental
Documents"
(ii) Clause (D) of the first paragraph of Section 7(c) is
hereby amended to be and read in its entirety as follows:
"(D) the offer, sale, holding, transfer or delivery of
the Equipment Notes or the Pass Through Certificates, whether
before, on or after the Delivery Date (the indemnity in this
clause (D) to extend also to any person who controls an
Indemnitee, its successors, assigns, employees, directors,
officers, servants and agents within the meaning of Section 15
of the Securities Act of 1933, as amended);"
(iii) The first proviso following clause (F) in the first
paragraph of Section 7(c) is hereby amended by adding the phrase ",
with respect to each Indemnitee," immediately following the phrase ";
provided, that" which appears therein,
(iv) Clauses (1) and (2) of the first proviso following clause
(F) in the first paragraph of Section 7(c) hereby are amended to be and
read in their entirety as follows:
"(1) any representation or warranty by such Indemnitee
in the Operative Documents or in the other Fundamental
Documents being incorrect, or (2) the failure by such
Indemnitee to perform or observe any agreement, covenant or
condition in any of the Operative Documents or any other
Fundamental Documents required to be performed or observed by
such Indemnitee, including, without limitation, any Expense
resulting from the creation or existence of a Lessor Lien
(including for this purpose Liens that would be Lessor Liens
but for the proviso to the definition of Lessor Liens) in
violation of any provision in the Operative Documents or any
other Fundamental Documents, or"
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[Second Amendment to Participation Agreement (1994 737 B)]
(v) Clause (4) of the proviso to the first paragraph of
Section 7(c) is hereby amended to be and read in its entirety as
follows:
"(4) (A) in the case of such Indemnitee a disposition
(voluntary or involuntary) of all or any part of its interest
in the Airframe or any Engine, (B) in the case of a Noteholder
a disposition (voluntary or involuntary) by such Noteholder of
all or any part of its interest in any Certificate or (C) in
the case of any Indemnitee a disposition by such Indemnitee of
all or any part of such Indemnitee's interest in the Operative
Documents other than in each of (A), (B) and (C) during the
continuance of an Event of Default under the Lease or in
connection with the exercise of remedies under any Fundamental
Document in connection with such an Event of Default or
pursuant to the exercise by Lessee of its purchase options or
in connection with a refinancing pursuant to Section 17 or 20
hereof, in connection with the termination of the Lease or
action or direction of Lessee pursuant to Section 7, 8, 9, 10
or 19 thereof or in connection with a substitution of the
Owner Trustee at the request of the Lessee, or"
(vi) Clause (5) of the proviso to the first paragraph of
Section 7(c) is hereby amended to be and read in its entirety as
follows:
"(5) other than to the extent provided in the succeeding
paragraph, any Tax (as defined in Section 7(b) hereof) whether
or not Lessee is required to indemnify for such Tax pursuant
to Section 7(b) hereof (it being understood that Section 7(b)
hereof and the Tax Indemnity Agreement and provisions
requiring payments to be made on an after-tax basis or
expressly providing for additional indemnification by Lessee
exclusively provide for Lessee's liability with respect to
Taxes); provided, however, such exception shall not apply to
the application of Parts 4 or 5 of Subpart B of Title I of
ERISA or Section 502(i) or (1) of ERISA to the execution and
delivery by Lessee of the Operative Documents or other
Fundamental Documents to which Lessee, Owner Participant or
Original Loan Participant is or will be a party or the
consummation of the transactions contemplated thereby
including the sale, resale, holding or transfer of the
Equipment Notes, the loan certificates issued under the
Original Indenture or Pass Through Certificates, or"
(vii) Clause (6) of the proviso to the first paragraph of
Section 7(c) is hereby amended by adding the phrase "in the case of
Expenses incurred by the
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[Second Amendment to Participation Agreement (1994 737 B)]
Owner Participant or any director, officer, employee, agent, servant or
Affiliate thereof," at the beginning of such clause.
(viii) Clause (7) of the proviso to the first paragraph of
Section 7(c) is hereby amended to be and read in its entirety as
follows:
"(7) (A) in the case of the Owner Trustee, the Owner
Participant or any Related Indemnitee thereof, a failure on
the part of the Owner Trustee to distribute in accordance with
the Trust Agreement any amounts received and distributable by
it thereunder, (B) in the case of the Indenture Trustee in its
individual capacity, a failure on the part of the Indenture
Trustee to distribute in accordance with the Trust Indenture
any amounts received and distributable by it thereunder, (C)
in the case of the Pass Through Trustee in its individual
capacity, a failure on the part of a Pass Through Trustee to
distribute in accordance with the applicable Pass Through
Trust Agreement any amounts received and distributable by such
Pass Through Trustee under such Pass Through Trust Agreement,
or (D) in the case of the Subordination Agent in its
individual capacity, a failure on the part of the
Subordination Agent to distribute funds received and
distributable by it in accordance with the Intercreditor
Agreement, or"
(ix) The proviso to Clause (9) of the proviso to the first
paragraph of Section 7(c) is hereby amended to be and read in its
entirety as follows:
"provided, however, such exception shall not apply to
the application of Parts 4 or 5 of Subpart B of Title I of
ERISA or Section 502(i) or (1) of ERISA to the execution and
delivery by Lessee of the Operative Documents or other
Fundamental Documents to which Lessee, Owner Participant or
Original Loan Participant is or will be a party or the
consummation of the transactions contemplated thereby
including the sale, resale, holding or transfer of the
Equipment Notes, the loan certificates issued under the
Original Indenture or Pass Through Certificates; or"
(x) A new clause (11) is hereby added to the proviso to the
first paragraph of Section 7(c), which clause shall be and read in its
entirety as follows:
", or (11) to any Expense imposed on any Indemnitee as a
result of a "prohibited transaction" as defined in Section 406
of ERISA or Section 4975 (c) (1) of the Code; provided,
however, that this exception
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[Second Amendment to Participation Agreement (1994 737 B)]
shall not apply to Lessee's obligation under this Section 7(c)
to indemnify an Indemnitee (other than any Noteholder or any
holder of Pass Through Certificates, or any Related Indemnitee
of any of them), for any Expense (except to the extent such
Tax arises from or is attributable to the incorrectness of a
representation or warranty made by such Indemnitee) incurred
by or asserted against such Indemnitee as a result of a
"prohibited transaction", within the meaning of Section 406 of
ERISA or Section 4975 (c) (1) of the Code, in any way relating
to, resulting from, or arising out of or in connection with,
directly or indirectly, a financing transaction pursuant to
Section 17 or 20, the offer, sale, resale, purchase, delivery
or holding of any Pass Through Certificate, any Loan
Certificate held by any Original Loan Participant or Equipment
Note (whether issued pursuant to the Original Indenture or the
Trust Indenture and whether issued on the Delivery Date or in
connection with the refinancing transaction or otherwise), or
any other transaction contemplated under any Operative
Documents or other Fundamental Documents whether such
prohibited transaction occurs before, on or after the Delivery
Date."
(xi) The ninth paragraph of Section 7(c) is hereby amended to
be and read in its entirety as follows:
"Lessee agrees to pay the reasonable and continuing fees
and expenses of the Indenture Trustee (including the
reasonable fees and expenses of its counsel) and each Pass
Through Trustee (including the reasonable fees and expenses of
its counsel), Subordination Agent (including the reasonable
fees and expenses of its counsel), Liquidity Provider
(including the reasonable fees and expenses of its counsel)
and, as provided in Section 6.07 of the Trust Agreement, the
Owner Trustee (including, but not limited to, the reasonable
fees and expenses of its counsel), without cost, on a net
after-tax basis, to the Owner Participant, for acting as such,
other than such fees and expenses which constitute Transaction
Expenses."
(c) Section 7(d) is hereby amended by deleting the reference to
"Section 2.04(b)" contained therein and inserting a reference to "Section
2.12" in lieu thereof.
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[Second Amendment to Participation Agreement (1994 737 B)]
SECTION 5. Amendment to Section 8. Section 8 of the Participation
Agreement is hereby amended in the following manner:
(a) Section 8(c) is hereby amended to be and read in its entirety as
follows:
"(c) State Street Bank and Trust Company of Connecticut, National
Association, in its individual capacity represents and warrants that
both the principal place of business of the Owner Trustee and the
place where its records concerning the Aircraft and all of its
interest in, to and under the Operative Documents to which it is a
party are or will be kept in Hartford, Connecticut (other than such as
may be maintained or held by the Indenture Trustee pursuant to the
Trust Indenture) and has its chief executive office (as such term is
used in Article 9 of the Uniform Commercial Code) in Hartford,
Connecticut. State Street Bank and Trust Company of Connecticut,
National Association in its individual capacity agrees that it will
not change the location of such office to a location outside of
Hartford, Connecticut, without prior written notice to Lessee,
Indenture Trustee and the Owner Participant."
(b) Section 8(d) is hereby amended to be and read in its entirety as
follows:
"(d) The Pass Through Trustee (and the Subordination Agent acting
on its behalf) represents and warrants and, by acceptance of its
Equipment Notes, each other Noteholder shall be deemed to have
represented and warranted that neither it nor anyone acting on its
behalf has offered any Equipment Notes or any similar securities
relating to the Aircraft for sale to, or solicited any offer to buy
any Equipment Notes or any similar securities relating to the Aircraft
from, any person or entity other than in a manner required by the
Securities Act of 1933, as amended, and the rules and regulations
thereunder and the securities laws, rules and regulations of any
state."
(c) Section 8(e) is hereby amended to be and read in its entirety as
follows:
"(e) The Owner Participant agrees that, if, at any time after the
close of the calendar year in which occurs the seventh anniversary of
the Delivery Date and so long as no Section 14(a), (b), (f) or (g)
Default or any Event of Default under the Lease shall have occurred or
be continuing, Lessee has requested its consent to the registration of
the Aircraft, in the name of the Owner Trustee (or, if appropriate, in
the name of Lessee or a Sublessee as a "lessee" or a "sublessee"), at
Lessee's expense, (i) upon 45 days' prior written notice in a country
listed on Exhibit G to the Lease, with which the United States
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[Second Amendment to Participation Agreement (1994 737 B)]
maintains diplomatic relations at the time of such request, or (ii)
upon 45 days' prior written notice in any other country with which the
United States maintains diplomatic relations at the time of such
request and the Owner Participant has not determined, acting
reasonably, that such other country would not provide substantially
equivalent protection for the rights of owner participants, lessors or
lenders in similar transactions as provided under United States law,
the Owner Participant will not, in the case of either clause (i) or
(ii), unreasonably withhold its consent to such change of
registration. The Owner Participant further agrees that the inability
of Lessee to deliver an opinion (reasonably satisfactory in form and
substance to the Owner Participant) of counsel reasonably acceptable
to the Owner Participant in such country listed on Exhibit G to the
Lease and addressed to the Owner Participant, the Owner Trustee and
the Indenture Trustee to the effect that the courts of such country
would give effect to the Owner Trustee's title to the Aircraft, to the
registry of the Aircraft in the name of the Owner Trustee (or, if
appropriate, in the name of Lessee or a Sublessee as a "lessee" or a
"sublessee"), and to the priority of the Lien under the Trust
Indenture substantially to the same extent as provided under United
States law, shall constitute the sole reasonable grounds to withhold
such consent in regard to a country listed in Exhibit G to the Lease,
and if said opinion is delivered and, so long as the Lien of the Trust
Indenture shall not have been discharged in accordance with its terms,
the Indenture Trustee provides the consent to the change of
registration contemplated by the first paragraph of Section 7.02 of
the Trust Indenture, the Owner Participant will instruct the Owner
Trustee to make such change of registration.
It is further agreed, however, that prior to any such change in
the country of registry of the Aircraft to a country not listed on
Exhibit G to the Lease, the Owner Participant and the Owner Trustee in
its individual capacity shall have received:
(i) assurances reasonably satisfactory to the Owner Participant
and the Owner Trustee in its individual capacity (A) to the effect
that the insurance or self-insurance provisions of the Lease have been
complied with after giving effect to such change of registry, (B) of
the payment by Lessee of any expenses of the Owner Participant,
Indenture Trustee and the Owner Trustee in connection with such change
of registry, (C) to the effect that the original indemnities (and any
additional indemnities for which Lessee is then willing to enter into
a binding agreement to indemnify) in favor of the Owner Participant,
Indenture Trustee and the Owner Trustee (in its individual capacity
and as trustee under the Trust Agreement) under this Agreement, the
Trust Indenture and the Tax Indemnity Agreement, afford each such
party substantially the same protection as provided prior to such
change of registry, (D) that such change will not result in the
imposition of, or increase in the amount of, any
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[Second Amendment to Participation Agreement (1994 737 B)]
Tax for which Lessee is not required to indemnify, or is not then
willing to enter into a binding agreement to indemnify, the Owner
Participant, Indenture Trustee and the Owner Trustee (in its
individual capacity and as trustee under the Trust Agreement) or any
successor, assign or affiliate of any thereof, or the Trust Estate
pursuant to Section 7(b) hereof; and (E) that such new country of
registry imposes aircraft maintenance standards not materially less
stringent than those of the FAA, the Civil Aviation Authority of the
United Kingdom, the Director Generale de l'Aviation Civil of the
French Republic or the Luftfahrt Bundesamt of Germany; and
(ii) a favorable opinion of counsel (reasonably satisfactory to
the Owner Trustee in its individual capacity and to the Owner
Participant) in the new jurisdiction of registry addressed to the
Owner Participant, the Owner Trustee and the Indenture Trustee to the
effect (A) that the terms (including, without limitation, the
governing-law, service-of-process and jurisdictional-submission
provisions thereof) of the Lease and the Trust Indenture are legal,
valid, binding and enforceable in such jurisdiction, (B) that it is
not necessary for the Owner Participant, the Indenture Trustee or the
Owner Trustee to register or qualify to do business in such
jurisdiction, (C) that there is no tort liability of the owner of an
aircraft not in possession thereof under the laws of such jurisdiction
other than tort liability which might have been imposed on such owner
under the laws of the United States or any state thereof (it being
understood that, in the event such latter opinion cannot be given in a
form satisfactory to the Owner Participant and the Owner Trustee, in
its individual capacity, such opinion shall be waived if insurance
reasonably satisfactory to Owner Participant and the Owner Trustee, in
its individual capacity, is provided, at Lessee's expense, to cover
such risk), (D) (unless Lessee shall have agreed to provide insurance
covering the risk of requisition of use of the Aircraft by the
government of such jurisdiction so long as the Aircraft is registered
under the laws of such jurisdiction) that the laws of such
jurisdiction require fair compensation by the government of such
jurisdiction payable in currency freely convertible into Dollars for
the loss of use of the Aircraft in the event of the requisition by
such government of such use, and (E) to such further effect with
respect to such other matters as the Owner Trustee in its individual
capacity or the Owner Participant may reasonably request.
Upon receipt by the Owner Participant and the Indenture Trustee
of the foregoing opinion of counsel, Exhibit F and Exhibit G to the
Lease shall be amended to add such country. Lessee agrees to cause a
copy of any opinion or other assurances delivered pursuant to the
provisions above to be delivered to the Indenture Trustee.
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[Second Amendment to Participation Agreement (1994 737 B)]
If, at any time, the Owner Participant delivers an opinion from a
law firm (such opinion and counsel to be reasonably satisfactory to
Lessee) in a country then listed on Exhibit F or G to the Lease
(including any country added to Exhibits F and G to the Lease after
the Delivery Date in accordance with the terms of this Section 8(e)
(an "Added Country")) to the effect that a reputable law firm located
in such jurisdiction would not as of the date of such opinion be able
to deliver an opinion of counsel as to the matters listed in Clauses
(A) through (D) of paragraph (ii) above (provided that in regard to
(C) or (D), Lessee is not willing to provide the insurance required by
such subsection (C) or (D)), then Exhibits F and G to the Lease shall
be amended to delete such country or Added Country, as the case may
be; provided that no such deletion shall affect the registration of
the Aircraft then in effect. Lessee shall pay the reasonable costs of
the Owner Participant in obtaining such opinion or in consulting with
such counsel if no opinion is delivered, up to an aggregate of $3,000
per instance of amendment, if such opinion is obtained or such
consultation takes place in connection with Lessee's request to change
the registry of the Aircraft to, or to sublease the Aircraft in, a
country listed on Exhibit F or G to the Lease.
In connection with any such re-registration, the Lessee shall, at
Lessee's cost and to the extent permitted by the laws of such country,
cause the interests of the Indenture Trustee in the Aircraft to be
duly registered or recorded under the laws of such country and at all
times thereafter to remain so duly registered or recorded unless and
until changed as provided herein, and shall cause to be done at all
times all other acts (including the filing, recording and delivery of
any document or instrument and the payment of any sum) necessary or,
by reference to prudent industry practice in such country, advisable
in order to establish the Indenture Trustee's interest in and to such
Aircraft as against the Owner Trustee, Lessee, any Permitted Sublessee
or any third parties in such jurisdiction.
The Indenture Trustee shall execute and deliver all such
documents as the Owner Trustee or Lessee may reasonably request and
otherwise cooperate with the Owner Trustee and Lessee for the purpose
of effecting, continuing or (as provided in this Section 6(a))
changing the registration of the Aircraft.
Lessee shall pay all expenses of the Owner Participant, the
Indenture Trustee and the Owner Trustee in connection with any change
of registry of the Aircraft."
(d) Clause (iv)(A) of Section 8(h) is hereby amended to be and read on
its entirety as follows:
13
15
[Second Amendment to Participation Agreement (1994 737 B)]
"(A) a transfer of the Aircraft pursuant to Section 9, 10 or 19
of the Lease or Article 8 of the Trust Indenture,"
(e) Section 8(j) is hereby amended to be and read in its entirety as
follows:
"(j) The Indenture Trustee and, by its acceptance of a an
Equipment Note, each Noteholder thereof (and each Pass Through
Trustee, so long as the relevant Pass Through Trust Agreement is in
effect), hereby waives to the fullest extent permitted by law the
benefit of the provisions of Section 1111(b) of Title 11 of the United
States Code with respect to recourse against the Owner Trustee (in its
individual capacity) and the Owner Participant on account of any
amount payable as principal of, Break Amount, if any, Make-Whole
Amount, if any, and interest on the Equipment Notes. If (i) all or any
part of the Trust Estate becomes the property of, or the Owner
Participant becomes, a debtor subject to the reorganization provisions
of the Bankruptcy Code or any successor provision, (ii) pursuant to
such reorganization provisions the Owner Trustee (in its individual
capacity) or the Owner Participant is required, by reason of the Owner
Trustee (in its individual capacity) or the Owner Participant being
held to have recourse liability to a Noteholder or the Indenture
Trustee, directly or indirectly (other than the recourse liability of
the Owner Trustee (in its individual capacity) or the Owner
Participant under this Participation Agreement, the Trust Indenture or
by separate agreement), to make payment on account of any amount
payable as principal, Break Amount, if any, Make-Whole Amount, if any,
or interest on the Equipment Notes and (iii) such Noteholder or the
Indenture Trustee actually receives any Excess Payment (as hereinafter
defined) which reflects any payment by the Owner Trustee (in its
individual capacity) or the Owner Participant on account of clause
(ii) above, then such Noteholder or the Indenture Trustee shall
promptly refund to the Owner Trustee or the Owner Participant
(whichever shall have made such payment) such Excess Payment. For
purposes of this Section 8(j), "Excess Payment" means the amount by
which such payment exceeds the amount which would have been received
by such Noteholder or the Indenture Trustee if the Owner Trustee (in
its individual capacity) or the Owner Participant had not become
subject to the recourse liability referred to in clause (ii) above.
Nothing contained in this Section 8(j) shall prevent any Noteholder or
the Indenture Trustee from enforcing any personal recourse obligation
(and retaining the proceeds thereof) of the Owner Trustee (in its
individual capacity) or the Owner Participant under this Participation
Agreement or the Owner Trustee (in its individual capacity) under the
Trust Indenture (and any exhibits or annexes thereto)."
14
16
[Second Amendment to Participation Agreement (1994 737 B)]
(f) Section 8(k)(i) is hereby amended such that the reference to
"Section 8.02 of the Trust Indenture" is hereby deleted and a reference to
"Section 9.07 of the Trust Indenture" is inserted in lieu thereof.
(g) Section 8(l) is hereby amended to be and read in its entirety as
follows:
"(l) So long as the Aircraft shall be leased to Lessee under the
Lease and so long as the Certificates are outstanding, the Owner
Participant will not sell, assign, convey or otherwise transfer any of
its right, title or interest in and to this Agreement, the Trust
Estate or the Trust Agreement to any person or entity, unless (i) the
proposed transferee is a "Transferee" (as defined below) and (ii) the
Owner Participant shall have delivered to the Owner Trustee, Lessee
and the Indenture Trustee an opinion (in form, scope and substance
reasonably satisfactory to Lessee) of counsel reasonably satisfactory
to Lessee to the effect that the agreement referred to in clause (O)
below and any guaranty required by clause (B) or (C) below, if any,
are the legal, valid, binding and enforceable obligations of the
Transferee and the guarantor, as the case may be (subject to the
normal bankruptcy and equitable remedies exceptions contained in an
opinion on such matters and any other applicable exemptions contained
in the opinions relating to the Owner Participant delivered pursuant
to Section 4(a)(xiv) hereof), and (iii) each of Lessee and the
Indenture Trustee shall have (1) received an opinion (in form and
substance reasonably satisfactory to Lessee) of counsel to the Owner
Participant (who shall be reasonably satisfactory to Lessee) to the
effect that there are no Taxes that will be imposed on Lessee, the
Indenture Estate, or the Indenture Trustee or required to be
indemnified against by Lessee, imposed on such transfer or (2)
received from the Owner Participant so seeking to transfer such right,
title or interest, indemnification, pursuant to an agreement
reasonably satisfactory to Lessee, for Taxes described in clause (1).
A "Transferee" shall mean either (A) a bank or other financial
institution with a combined capital, surplus and undivided profits of
at least $50,000,000 or a corporation whose net worth is at least
$50,000,000, (B) any subsidiary of such a bank, financial institution
or corporation, provided that such bank, financial institution or
corporation furnishes to the Owner Trustee, the Indenture Trustee and
Lessee a guaranty satisfactory to Lessee with respect to the Owner
Participant's obligations, in the case of the Owner Trustee, under the
Trust Agreement and, in the case of the Indenture Trustee and Lessee,
the Owner Participant's obligations hereunder, or (C) any other
entity, provided such obligations are guaranteed by the transferor
Owner Participant; provided, however, unless otherwise consented to by
Lessee, any Transferee shall not be an airline, a commercial air
carrier, an air freight forwarder, an entity engaged in the business
of parcel transport by air or other similar person or a corporation or
other entity controlling, controlled by or
15
17
[Second Amendment to Participation Agreement (1994 737 B)]
under common control with such an airline, a commercial air carrier,
an air freight forwarder, an entity engaged in the business of parcel
transport by air or other similar person. Each such transfer to a
Transferee shall be subject to the conditions that (M) upon giving
effect to such transfer, the Transferee is a "citizen of the United
States" within the meaning of Section 40102(a)(15) of the
Transportation Code or the Transferee, at its sole cost and expense on
an after-tax basis (including any continuing costs of the voting
trust), shall have entered into a voting trust or similar arrangement
which permits the registration of the Aircraft under the
Transportation Code in the name of the Owner Trustee, (N) the
Transferee has the full power and authority to enter into and carry
out the transactions contemplated hereby, (O) the Transferee enters
into an agreement or agreements, in form and substance reasonably
satisfactory to Lessee, whereby from and after the transfer the
Transferee confirms that it shall be deemed a party to this Agreement
and a party to the Trust Agreement and agrees to be bound by all the
terms of, and to undertake all of the obligations of the transferor
Owner Participant contained in the Owner Participant Documents (to the
extent of the participation so transferred to it) and makes the
representation made in Section 8(f)(ii) (but not including ERISA)
which shall be based on the representations, warranties, and covenants
of the other parties (or their successors) to the Operative
Agreements, (P) such transfer does not violate any applicable law
including, without limitation, the Transportation Code, or any rules
or regulations promulgated thereunder, the Securities Act of 1933 or
the Trust Indenture Act of 1939 (but not including ERISA), assuming
the continuing truth of the representation of the Lessee and the
Original Loan Participant in Section 8(o) and compliance with Sections
8(y) and 8(z), (Q) the transferor Owner Participant assumes the risk
of any loss of Interest Deductions, MACRS Deductions or any Inclusion
Event (each as defined in the Tax Indemnity Agreement) resulting from
such transfer, (R) after giving effect to such transfer, there shall
be no more than two Owner Participants of record at that time and (S)
such transfer will not give rise to an Indenture Default or Indenture
Event of Default under the Trust Indenture; and Lessee may request
such Transferee to provide an opinion of counsel (who shall be
reasonably satisfactory to Lessee) in form and substance reasonably
satisfactory to Lessee as to any matter set forth in clauses (N) or
(P) (in the case of clause (P), such opinion being to the effect that
the interest being transferred does not require registration under the
Securities Act of 1933, and as to such other matters referred to in
clause (P) as are comparable in substance (including exceptions and
qualifications) to the opinions relating to the Owner Participant
delivered pursuant to Section 4(a)(xiv) hereof) (it being understood
that counsel may assume those facts pertaining to Lessee, Indenture
Trustee or the Holders). Upon any such transfer by the Owner
Participant as above provided, the Transferee shall be deemed the
Owner Participant for all purposes hereof and
16
18
[Second Amendment to Participation Agreement (1994 737 B)]
of the other Operative Documents and each reference herein to the
transferor Owner Participant shall thereafter be deemed for all
purposes to be to the Transferee and the transferor Owner Participant
shall be relieved of all obligations of the transferring Owner
Participant under the Owner Participant Documents arising after the
date of such transfer except to the extent fairly attributable to acts
or events occurring prior thereto and not assumed by the transferee
Owner Participant (in each case, to the extent of the participation so
transferred). If the Owner Participant intends to transfer any of its
interests hereunder, (i) unless waived by Lessee, it shall give prior
written notice thereof as soon as practicable, but in no event less
than 10 days prior thereto, to the Indenture Trustee, the Owner
Trustee and Lessee, specifying the name and address of the proposed
Transferee and (ii) the parties hereto shall, upon the written request
of the Owner Participant, reasonably cooperate in connection with such
transfer, including providing acknowledgments of their respective
consent to such transfer. The Owner Participant shall pay all of the
reasonable costs of the other parties hereto, on a net after-tax
basis, of any such transfer. For purposes of this paragraph, "net
worth" shall mean the excess of total tangible assets over total
liabilities, each to be determined in accordance with generally
accepted accounting principles consistently applied."
(h) Section 8(r) is hereby amended such that any references to
"Section 2.15 of the Trust Indenture" are hereby deleted and a reference to
"Section 7.03 of the Trust Indenture" is inserted in lieu thereof and any
references to "Section 2.14 of the Trust Indenture" are hereby deleted and
a reference to "Section 8.03(e)(ii)" is inserted in lieu thereof.
(i) Section 8(s) is hereby amended in the following manner:
(i) Clause (ii) of Section 8(s) is hereby amended by adding the
words "and the Pass Through Trust Documents" immediately after the
words "Operative Documents" and before the words "to be performed"
which appear therein.
(ii) The last paragraph of Section 8(s) is hereby amended to be
and read in its entirety as follows:
"Upon any consolidation or merger, or any conveyance,
transfer or lease of substantially all of the assets of Lessee as
an entirety in accordance with this Section 8(s), the successor
corporation or Person formed by such consolidation or into which
Lessee is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may
exercise every right and power of, Lessee
17
19
[Second Amendment to Participation Agreement (1994 737 B)]
under this Agreement and under the Pass Through Trust Documents
with the same effect as if such successor corporation or Person
had been named as Lessee herein and therein. No such conveyance,
transfer or lease of substantially all of the assets of Lessee as
an entirety shall have the effect of releasing Lessee or any
successor corporation or Person which shall theretofore have
become such in the manner prescribed in this Section 8(s) from
its liability in respect of any Operative Document to which it is
a party or any Pass Through Trust Document."
(j) A new Section 8(aa) is hereby added to Section 8, which section
shall be and read in its entirety as follows:
"(aa) Notwithstanding anything to the contrary contained
herein, it is expressly agreed and understood that the provisions
of Sections 8(o), 8(y) and 8(z) shall not apply to (i) any
issuance of Equipment Notes by the Owner Trustee to the Pass
Through Trustees (as beneficial owners) and the Subordination
Agent (as record owner), (ii) any acquisition and holding of
Equipment Notes by the Pass Through Trustees (as beneficial
owners) and the Subordination Agent (as record owner), (iii) the
issuance by each Pass Through Trust of the Pass Through
Certificates, (iv) the acquisition, holding or transfer of Pass
Through Certificate(s) by a holder thereof or a prospective
transferee thereof, or (v) any sale, assignment, conveyance,
exchange or other transfer of any Equipment Note or any interest
in, or represented by, any Equipment Note from the Pass Through
Trustee to a subsequent Pass Through Trustee."
SECTION 6. Amendment to Section 10. The last sentence of Section 10
the Participation Agreement is hereby amended to be and read in its entirety as
follows:
"Each Noteholder shall be deemed to have agreed that it will not take
any action in respect of the Indenture Estate except through the Indenture
Trustee pursuant to the Trust Indenture or as otherwise permitted by the Trust
Indenture."
SECTION 7. Amendment to Section 13. Section 13 of the Participation
Agreement is hereby amended in the following manner:
(i) Clause (A) of the second sentence of Section 13(a) is hereby
amended by adding the phrase ", the Pass Through Trustees, the Subordination
Agent" immediately following the words "the Indenture Trustee" appearing
therein.
18
20
[Second Amendment to Participation Agreement (1994 737 B)]
(ii) Clause (C) of the second sentence of Section 13(a) is hereby
amended to be and read in its entirety as follows:
"(C) if to any Noteholder, addressed to such Noteholder at its
address set forth in the Register maintained under Section 2.03 of the
Trust Indenture."
(iii) The first sentence of Section 13(b) is hereby amended by
deleting the phrase "and, by acceptance of its certificate, each subsequent
Holder" contained therein and inserting the phrase "by acceptance of its
Equipment Note, each Noteholder" in lieu thereof.
SECTION 8. Amendments to Section 15. Section 15 of the Participation
Agreement is hereby amended as follows:
(i) Section 15(a) is hereby amended to be and read in its entirety as
follows:
"(a) Each of the Owner Participant and each Noteholder covenants
and agrees that it shall not unreasonably withhold its consent to any
consent requested of the Owner Trustee, as Lessor, or the Indenture
Trustee under the terms of the Lease, which by its terms is not to be
unreasonably withheld by the Owner Trustee, as Lessor, or by the
Indenture Trustee."
(ii) Section 15(b) is hereby amended to be and read in its entirety as
follows:
"(b) The representations, warranties, indemnities and agreements
of Lessee, the Owner Trustee, the Indenture Trustee, the Pass Through
Trustees, the Subordination Agent, the Owner Participant and any
Noteholder provided for in this Agreement, and Lessee's, the Owner
Trustee's, Indenture Trustee's, any Pass Through Trustee's, the
Subordination Agent's, any Noteholder's and the Owner Participant's
obligations under any and all thereof, shall survive the making
available of the respective Commitments by the Participants, the
delivery or return of the Aircraft, the transfer of any interest of
the Owner Participant in the Trust Estate or the Aircraft or any
Engine or the transfer of any interest by any Noteholder in any
Equipment Note or the Indenture Estate and the expiration or other
termination of this Agreement or any other Operative Document."
SECTION 9. Amendment to Section 17. Section 17 of the Participation
Agreement is hereby amended in the following manner:
19
21
[Second Amendment to Participation Agreement (1994 737 B)]
(a) Section 17(c) is hereby amended to be and read in its entirety as
follows:
"(c) Lessee shall give the Indenture Trustee notice of any such
prepayment as is required pursuant to the terms of the Trust
Indenture."
(b) A new Section 17(f) is hereby added to Section 17, which Section
17(f) shall be and read in its entirety as follows:
"(f) So long as the Subordination Agent or any Pass Through
Trustee is the registered holder of any Equipment Notes, no refunding
or refinancing under this Section 17 shall occur prior to December 2,
2002."
SECTION 10. Amendment to Section 18. Section 18(b) of the
Participation Agreement is hereby amended to be and read in its entirety as
follows:
"(b) In connection with optimization adjustments of Basic Rent,
Interim Rent, Excess Amount, Stipulated Loss Value percentages,
Termination Value percentages and EBO Percentage pursuant to this
Section 18 and Section 3(c) of the Lease, the parties hereto agree
that no Amortization Schedule with respect to any Series of Equipment
Notes will be changed."
SECTION 11. Amendment to Section 21. Section 21 of the Participation
Agreement is hereby deleted in its entirety.
SECTION 12. Ratification; References to Participation Agreement;
Effective Date. Except as amended hereby, the Participation Agreement continues
and shall remain in full force and effect in all respects. From and after the
date of this Amendment, each and every reference in the Participation Agreement,
as amended hereby, to "this Agreement", "herein", "hereof" or similar words and
phrases referring to the Participation Agreement or any word or phrase referring
to a section or provision of the Participation Agreement is deemed for all
purposes to be a reference to the Participation Agreement or such section or
provision as amended pursuant to this Amendment. The amendments to the
Participation Agreement contemplated by this Amendment shall be effective from
and after the date the Third Amendment to Lease is filed for record with the
FAA.
SECTION 13. Miscellaneous. This Amendment 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. Neither this Amendment nor any of
the terms hereof may be terminated, amended, supplemented, waived or modified,
except by an instrument in writing signed by the party against which the
enforcement of the termination, amendment, supplement, waiver or modification is
sought; and no such termination, amendment, supplement, waiver or
20
22
[Second Amendment to Participation Agreement (1994 737 B)]
modification shall be effective unless a signed copy thereof shall have been
delivered to the Lessee, the Indenture Trustee, the Owner Participant and the
Owner Trustee. The terms of this Amendment shall be binding upon, and inure to
the benefit of and shall be enforceable by, the Lessee, the Owner Participant,
the Indenture Trustee, the Pass Through Trustees, the Subordination Agent and
the Owner Trustee. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF ILLINOIS,
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. THIS AMENDMENT
IS BEING DELIVERED IN THE STATE OF ILLINOIS.
SECTION 14. Authorization to Execute Amendments. By execution of this
Amendment, the Owner Participant hereby authorizes, directs and instructs the
Owner Trustee to execute and deliver this Amendment, the First Amendment to
Trust Agreement (1994 737 B) dated as of December 23, 1997 (the "First Amendment
to Trust Agreement") between the Owner Participant and State Street Bank and
Trust Company of Connecticut, National Association, the Third Amendment to Lease
Agreement (1994 737 B) dated as of December 23, 1997 (the "Third Amendment to
Lease Agreement") between the Lessee and the Owner Trustee, the Note Purchase
Agreement, dated as of December 23, 1997 among the Lessee, the Owner Trustee,
the Indenture Trustee and certain other parties and any and all other
amendments, agreements and certificates as may be necessary in a result of the
refinancing contemplated hereby. By their execution of this Amendment, each of
the Lessee, the Pass Through Trustees and the Indenture Trustee hereby consent
to the execution and delivery of the First Amendment to Trust Agreement and the
Third Amendment to Lease Agreement.
SECTION 15. Additional Parties. Effective as of the date hereof, each
Pass Through Trustee and the Subordination Agent shall be a party to the
Participation Agreement, as amended hereby, and the Subordination Agent (acting
on behalf of the Pass Through Trustees pursuant to the Intercreditor Agreement)
shall have the rights and obligations of the Noteholders as set forth in the
Participation Agreement, as amended hereby.
SECTION 16. Owner Participant Representations. The Owner Participant
represents and warrants to the Indenture Trustee, the Owner Trustee, each Pass
Through Trustee, the Subordination Agent and the Lessee that:
(i) the Owner Participant is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware and has
the corporate power and authority to carry on its business as now
conducted, to own or hold under lease its properties and to enter into this
Agreement, the Participation Agreement, the First Amendment to
Participation Agreement, the Tax Indemnity Agreement, the First Amendment
to Tax Indemnity Agreement, the Trust Agreement and the First Amendment to
Trust Agreement (collectively, the "OP Documents") and
21
23
[Second Amendment to Participation Agreement (1994 737 B)]
to perform its obligations under the Participation Agreement, the Tax
Indemnity Agreement and the Trust Agreement;
(ii) each of the OP Documents has been duly authorized by all
necessary corporate action on the part of the Owner Participant, does not
require any approval not already obtained of stockholders of the Owner
Participant or any approval or consent not already obtained of any trustee
or holders of any indebtedness or obligations of the Owner Participant, and
has been, or on the date hereof will have been, duly executed and delivered
by it, and none of the execution and delivery by the Owner Participant
thereof, the consummation by the Owner Participant of the transactions
contemplated by this Agreement, the Participation Agreement, the Tax
Indemnity Agreement and the Trust Agreement or compliance by it with the
terms and provisions hereof or thereof will contravene any United States
federal or state law, judgment, governmental rule, regulation or order
applicable to or binding on it (it being understood that no representation
or warranty is made with respect to laws, rules or regulations relating to
aviation or to the nature of the equipment owned by the Owner Trustee,
other than such laws, rules or regulations relating to the citizenship
requirements of the Owner Participant under applicable aviation law or,
except as set forth in clause (vii) of this Section 16, ERISA) or
contravenes or results or will contravene or result in any breach of or
constitute any default under, or result in the creation of any Lien (other
than Liens provided for or otherwise permitted in the Fundamental
Documents) upon the Trust Estate under, any indenture, mortgage, chattel
mortgage, deed of trust, conditional sales contract, bank loan or credit
agreement, corporate charter, by-law or other agreement or instrument to
which it is a party or by which it or its properties may be bound or
affected;
(iii) each of the Participation Agreement, the Tax Indemnity Agreement
and the Trust Agreement, in each case as amended, will, as of the date
hereof, constitute the legal, valid and binding obligation of the Owner
Participant enforceable against the Owner Participant in accordance with
the terms thereof;
(iv) there are no pending or, to the knowledge of the Owner
Participant, threatened actions or proceedings against the Owner
Participant before any court or administrative agency which individually
(or in the aggregate in the case of any group of related lawsuits) purports
to affect the legality, validity or enforceability of, or which is
reasonably likely to materially adversely affect the ability of the Owner
Participant to perform its obligations under, any of the Participation
Agreement, the Tax Indemnity Agreement and the Trust Agreement;
(v) there are no Lessor Liens (including for this purpose Liens that
would be Lessor Liens but for the proviso to the definition of Lessor
Liens) attributable to the Owner Participant;
22
24
[Second Amendment to Participation Agreement (1994 737 B)]
(vi) it is a "citizen of the United States" as defined in Section
40102(a)(15) of the Transportation Code;
(vii) no part of the funds used by it to make its investment pursuant
to Section 1 of the Participation Agreement constituted "plan assets" of
any "employee benefit plan" within the meaning of ERISA or of any "plan"
within the meaning of Section 4975(e)(1) of the Code; and
(viii) neither the Owner Participant nor anyone authorized by it to
act on its behalf (other than for purposes of this paragraph, the Lessee,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, BT Alex. ▇▇▇▇▇ Incorporated, Citicorp
Securities, Inc., Credit Suisse First Boston Corporation and ▇▇▇▇▇▇▇ Lynch,
Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated) has directly or indirectly offered any
Equipment Notes or any interest in or any similar interest for sale to, or
solicited any offer to acquire any of the same from, any Person.
* * *
23
25
[Second Amendment to Participation Agreement (1994 737 B)]
IN WITNESS WHEREOF, the parties hereto have caused this Second
Amendment to Participation Agreement to be duly executed by their respective
officers thereunto duly authorized as of the day and year first above written.
UNITED AIR LINES, INC.,
Lessee
By:
---------------------------------------------
Vice President and Treasurer
MS FINANCING INC.,
Owner Participant
By:
---------------------------------------------
Title:
---------------------------------------
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its individual capacity,
except as expressly provided herein, but solely
as Owner Trustee,
Owner Trustee
By:
---------------------------------------------
Title:
---------------------------------------
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
Indenture Trustee
By:
---------------------------------------------
Title:
---------------------------------------
24
26
[Second Amendment to Participation Agreement (1994 737 B)]
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
in its capacity as Pass Through Trustee under
each of the four separate Pass Through Trust
Agreements and as Noteholder
By:
---------------------------------------------
Title:
---------------------------------------
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
Subordination Agent
By:
---------------------------------------------
Title:
---------------------------------------
25
27
[Second Amendment to Participation Agreement (1994 737 B)]
SCHEDULE I
NAMES AND ADDRESSES
LESSEE:
Address for Notices:
U.S. Mail
United Air Lines, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President and Treasurer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Overnight Delivery Service
United Air Lines, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Vice President and Treasurer
OWNER PARTICIPANT:
Address for Notices:
MS Financing Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Payments:
Citibank, N.A.
Delaware Account No.: 338833374
28
[Second Amendment to Participation Agreement (1994 737 B)]
OWNER TRUSTEE:
Address for Notices:
State Street Bank and Trust Company
of Connecticut, National Association
▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ and Trust Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Overnight Delivery Service
State Street Bank and Trust Company of Connecticut,
National Association
▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ and Trust Company
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Attn: Corporate Trust Department
Address for Payments:
State Street Bank and Trust Company
Boston, MA
ABA# ▇▇▇-▇▇▇-▇▇▇
Acct# 9900-3147
Re: United Air Lines, Inc. 1994 737 B
INDENTURE TRUSTEE:
Address for Notices:
First Security Bank, National Association
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Attn: Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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[Second Amendment to Participation Agreement (1994 737 B)]
Address for Payments:
First Security Bank, National Association
ABA# ▇▇▇-▇▇▇▇-▇▇
Acct# 051-0922115
Attn: Corporate Trust Department
Ref: Indenture Trust - 1994 737 B
PASS THROUGH TRUSTEE AND SUBORDINATION AGENT:
Address for Notices:
First Security Bank, National Association
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▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Payments:
First Security Bank, National Association
ABA# ▇▇▇-▇▇▇▇-▇▇
Acct# 051-0922115
Attn: Corporate Trust Department
Ref: Pass Through Trust A/B/C/D
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