Exhibit 1(b)
FORM OF UNDERWRITING AGREEMENT
UNITED AIR LINES, INC.
PASS THROUGH CERTIFICATES, SERIES ____-__
UNDERWRITING AGREEMENT
___________ __, ______
________ __, ____
[Insert names of Underwriters]
c/o [Insert name of lead manager]
_________________________________
_________________________________
Dear Sirs and Madames:
United Air Lines, Inc., a Delaware corporation (the
"Company"), proposes that ____________________________, acting not in its
individual capacity but solely as Pass Through Trustee (the "Trustee")
under the Pass Through Trust Agreement referred to below, issue and sell to
the several underwriters named in Schedule I its Pass Through Certificates,
Series ____-__ in the aggregate principal amounts and with the interest
rates and final expected distribution dates set forth on the cover page of
the Prospectus (as defined below) (the "Securities") on the terms and
conditions stated herein. The aggregate principal amount of Securities
payable on each such final expected distribu tion date is referred to as a
"Pass Through Certificate Designation." The Securities will be issued under
a Pass Through Trust Agreement, dated as of __________ __, ____ (the "Basic
Pass Through Trust Agreement"), between the Company and the Trustee, as
supplemented by a Pass Through Trust Supplement, dated as of ________ __,
____ (a "Trust Supplement"), between the Company and the Trustee (the Basic
Pass Through Trust Agreement as supplemented by the Trust Supplement being
referred to as the "Pass Through Trust Agreement").
As used in this Agreement, the terms "Aircraft,"
"Certificate Owner," "Equipment Notes," "Lease," "Indenture Trustee,"
"Operative Documents," "Owner Participant," "Owner Trustee" and
"Participation Agreement" shall have the meanings specified in the
__________ Trust Indenture and Security Agreements, dated as of
____________ __, ____, between [the Company] [the related Owner Trustee]
and the Indenture Trustee (each, an "Indenture") or the Pass Through Trust
Agreement.
[For purposes hereof, the term "Financing Agreements"
shall mean, collectively, the Note Purchase Agreement, the Pass Through
1
Trust Agreement, the Liquidity Facilities and the Intercreditor Agreement
and the term "Fundamental Documents" shall mean, collectively, the
Financing Agreements and the Operative Documents.]
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No.
333-____), relating to certain pass through certificates and debt
securities, including the Securities, and the offering thereof from time to
time in accordance with Rule 415 of the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder (collec tively,
the "Securities Act"). The Registration Statement includes a basic
prospectus referred to below which, as supplemented from time to time, will
be used in connection with all offerings of such pass through certificates
and debt securities. The Registration Statement as amended at the date
hereof is herein referred to as the "Registration Statement." A prospectus
supplement or supplements reflecting the terms of the Securities, the terms
of the offering thereof and other matters relating to the Securities has
been prepared and has been or will be filed, or transmitted for filing,
together with the basic prospectus referred to below pursuant to Rule 424
under the Securities Act (such prospectus supplement, in the form first
filed on or after the date hereof pursuant to Rule 424, is referred to as
the "Prospectus Supplement" and any such prospectus supplement in the form
or forms filed prior to the Prospectus Supplement is referred to as a
"Preliminary Prospectus Supplement"). The basic prospectus included in the
Registration Statement and relating to all offerings of pass through
certificates and debt securities under the Registration Statement, as
supplemented by the Prospectus Supplement, is called the "Prospectus,"
except that, if such basic prospectus is amended on or prior to the date on
which the Prospectus Supplement is first filed pursuant to Rule 424, the
term "Prospectus" shall refer to such basic prospectus as so amended and as
supplemented by the Prospectus Supplement, in either case including the
documents filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Commission thereunder (collectively, the "Exchange Act"), that are
incorporated by reference therein. Any reference herein to the terms
"amendment" or "supplement" with respect to the Registration Statement, the
Prospectus, any Preliminary Prospectus Supplement or to any preliminary
prospectus shall be deemed to refer to and include any documents filed with
the Commission under the Exchange Act after the date hereof, the date the
Prospectus is filed, or transmitted for filing, with the Commission, or the
date of such Preliminary Prospectus Supplement or preliminary prospectus,
as the case may be, and incorporated therein by reference pursuant to Item
12 of Form S-3 under the Securities Act.
2
1. Representations and Warranties. The Company
represents and warrants to, and agrees with, you that:
(a) The Company meets the requirements for
use of Form S-3 under the Securities Act; the Registration Statement has
become effective; (i) on the original effective date of the Registration
Statement and on the effective date of the most recent post-effective
amendment thereto, if any, the Registration Statement and any amendments
and supplements thereto complied as to form in all material respects with
the requirements of the Securities Act and did not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; and (ii) on the date hereof and on the Closing Date (as defined
below), (A) neither the Registration Statement nor any amendment or
supplement thereto will contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and (B) neither the Prospectus
nor any amendment or supplement thereto will include an untrue statement of
a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading, except that the Company makes no representation
or warranty as to statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by or on
behalf of the Underwriters expressly for use in the Registration Statement
or the Prospectus or to statements or omissions in that part of the
Registration Statement which shall constitute the Statement of Eligibility
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), on Form T-1 of the Trustee.
(b) The documents incorporated by reference
in the Prospectus pursuant to Item 12 of Form S-3 under the Securities
Act, at the time they were or hereafter are filed with the Commission,
complied and will comply as to form in all material respects with the
requirements of the Exchange Act.
(c) The Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws of the
State of Delaware, has the corporate power and authority to own or lease
its property and to conduct its business as described in the Prospectus and
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
3
material adverse effect on the Company and its subsidiaries, taken as a
whole. 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 and are owned by UAL Corporation, directly, free and clear
of any pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind ("Liens").
(d) Each [Operative Document] [Fundamental
Document] conforms in all material respects to the descriptions thereof in
the Prospectus.
(e) This Agreement has been duly authorized,
executed and delivered by the Company.
(f) The Securities have been duly authorized
and, when executed and authenticated in accordance with the provisions of
the Pass Through Trust Agreement and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will be valid
and binding obligations of the Trustee, enforceable in accordance with
their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law)
and will be entitled to the benefits of the Pass Through Trust Agreement
[and the other Financing Agreements to which the Trustee is a party].
(g) Each of the Pass Through Trust Agreement
and each other [Operative] [Fundamental] Document to which the Company is,
or is to be, a party has been duly authorized, executed and delivered by,
and is a valid and binding agreement of, the Company, enforceable in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights generally and except
as enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceed ing in equity
or at law).
(h) The Equipment Notes to be issued under
each Indenture, when duly executed and delivered by the [Company] [related
4
Owner Trustee] and duly authenticated by the Indenture Trustee in
accordance with the terms of such Indenture, will be duly issued under such
Indenture and will constitute the valid and binding obligations of the
Company and the holders thereof will be entitled to the benefits of such
Indenture.
(i) 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 a material adverse effect on
the condition (financial or otherwise), earnings or business of the Company
and its subsidiaries, taken as a whole. The execution and delivery by the
Company of this Agreement, the Pass Through Trust Agreement and the
[Operative] [Fundamental] Documents to which the Company is, or is to be, a
party, the consummation by the Company of the transactions contemplated in
this Agreement, the Pass Through Trust Agreement and the [Operative]
[Fundamental] Documents, and compliance by the Company with the terms of
this Agreement, the Pass Through Trust Agreement and the [Operative]
[Fundamental] Documents, do not and will not result in any violation of the
charter or by-laws of the Company, and do not and will not conflict with,
or result in a breach of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge
or encumbrance (other than Permitted Liens) upon any property or assets of
the Company under (A) any indenture, mortgage, loan agreement, note, lease
or other material agreement or instrument to which the Company is a party
or by which it may be bound or to which any of its properties, may be
subject or (B) any existing applicable law, rule, regulation, judgment,
order or decree of any government, governmental instrumental ity or court,
domestic or foreign, having jurisdiction over the Company or any of its
properties, other than the securities or Blue Sky or similar laws of the
various states and foreign jurisdictions (except, in the case of either
clause (A) or (B), for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not have a material adverse effect on
the condition (financial or otherwise), earnings or business of the Company
and its subsidiaries, taken as a whole).
(j) No authorization, approval, consent,
order or license of or filing with or notice to any government,
governmental instrumentality or court, domestic or foreign, is required on
behalf of the Company for the valid authorization, issuance, sale and
delivery of the Securities and the Equipment Notes, the valid
authorization, execution, delivery and performance by the Company of this
Agreement, the Pass Through Trust Agreement, the Leases and the other
[Operative] [Fundamental] Documents to which the Company is, or is to be, a
5
party, or the consummation by the Company of the transactions contemplated
by this Agreement, the Pass Through Trust Agreement, the Leases and the
other [Operative] [Fundamental] Documents, except such as are required
under (x) the Securities Act, the Exchange Act, the Trust Indenture Act and
the securities or Blue Sky or similar laws of the various states and of
foreign jurisdictions, (y) the Sections of Title 49 of the United States
Code, as amended, relating to aviation (the "Aviation Act") and filings or
recordings with the Federal Aviation Administration (the "FAA") and (z)
filings under the Uniform Commercial Code as in effect in ___________ and
________, which filings shall have been made or obtained, or duly presented
for filing, on or prior to the Closing Date.
(k) Except as disclosed in the Prospectus
or incorporated by reference, there is no action, suit or proceeding before
or by any government, governmen tal instrumentality or court, domestic or
foreign, now pending or, to the knowledge of the Company, threatened
against or affecting the Company that is required to be disclosed in the
Prospectus or that could reasonably be expected to result in a material
adverse change in the condition (financial or otherwise), earnings or
business of the Company and its subsidiaries, taken as a whole, or that
could reasonably be expected to materially and adversely affect the
consummation of the transactions contemplated by this Agreement; the
aggregate of all pending legal or governmental proceedings to which the
Company is a party or which affect any of its properties that are not
described in the Prospectus, including ordinary routine litigation
incidental to its business, would not reasonably be expected to have a
material adverse effect on the condition (financial or otherwise), earnings
or business of the Company and its subsidiaries, taken as a whole.
(l) The Company has all licenses, permits,
orders, consents, authorizations and approvals, of and from, and has made
all filings (other than those filings described in clauses (x), (y) and (z)
of Section 1(j)above) with, all governmental authorities, all
self-regulatory organizations and all courts and other tribunals, necessary
to own or lease its properties and to conduct its business in the manner
described in the Prospectus, except to the extent that the failure to so
have would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(m) Since the dates as of which information
is given in the Prospectus, except as otherwise stated or incorporated by
reference therein or contem plated thereby, there has not occurred any
material adverse change in the condition (financial or otherwise) or in the
earnings or business of the Company and its subsidiaries, taken as a whole.
6
(n) Xxxxxx Xxxxxxxx LLP, who have reported
upon the audited consolidated financial statements and the financial
statement schedules, if any, incorporated by reference in the Prospectus,
are independent public accountants as required by the Securities Act.
(o) The Company is a "citizen of the United
States" within the meaning of Section 40102(a)(15) of Title 49 of the
United States Code, as amended, holding an air carrier operating
certificate issued by the Secretary of Transportation pursuant to Chapter
447 of Title 49 of the United States Code, as amended, for aircraft capable
of carrying 10 or more individuals or 6,000 pounds or more of cargo.
2. Agreements to Sell and Purchase. Subject to the terms
and conditions contained herein, the Company hereby agrees to sell to the
several Underwriters, and each Underwriter agrees, severally and not
jointly, to purchase from the Company the respective principal amount of
Securities set forth in Schedule I opposite its name at a purchase price of
_____% of 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 Underwriters, 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 substantially similar to the Securities
(other than the sale of the Securities under this Agreement and [insert
other carve-outs]).
3. Terms of Offering. You have advised the Company that
the Underwriters will make an offering of the Securities purchased by the
Underwriters on the terms to be set forth in the Prospectus, 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 Underwriters at 10:00 a.m., New York City time, on
________ __, ____, or at such other time on the same or such other date,
not later than ________ __,____, as shall be designated in writing by you.
The time and date of such payment are referred to as the "Closing Date."
7
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 Underwriters, with any transfer taxes
payable in connection with the transfer of the Securities to the
Underwriters 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 Underwriters' Obligations. The
several obligations of the Underwriters to purchase and pay for the
Securities on the Closing Date are subject to the following conditions:
(a) After 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 change, in
the rating accorded the Company or any of the Company's securities
by [Xxxxx'x Investor Service, Inc. ("Moody's") or Standard &
Poor's Ratings Services ("Xxxx dard & Poor's")];
(ii) the Company's Pass Through
Certificates, Series ____-___ shall be rated "___" by [Moody's] and
"___" by [Standard & Poor's]; and
(iii) there shall not have occurred any
change, or any development involving a prospective change, in the
condition (financial or otherwise), earnings or business of the
Company and its subsidiaries, taken as a whole, from that set forth
in the Prospectus (exclusive of any amendments or supplements thereto
after the date of this Agreement) that, in your reasonable
judgment, is material and adverse and that makes it, in your
reasonable judgment, impracticable to market the Securities on the
terms and in the manner contemplated in the Prospectus.
8
(b) The Underwriters shall have received on
the Closing Date a certificate, dated the Closing Date and signed by the
[Vice President and Treasurer] or the [Senior Vice President-General
Counsel and Secretary] of the Company, to the effect set forth in Section
5(a)(i) 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
hereunder on or before the Closing Date.
(c) The Underwriters shall have received on
the Closing Date an opinion of (i) ____________________, outside counsel
for the Company, dated the Closing Date, substantially to the effect set
forth in Exhibit A-1, (ii) the General Counsel or Assistant General Counsel
of the Company, dated the Closing Date, substantially to the effect set
forth in Exhibit A-2 and (iv) _______________, counsel for the Trustee,
dated the Closing Date, substantially to the effect set forth in Exhibit
A-3. Such opinions shall be rendered to the Underwriters at the request of
the Company and shall so state therein.
(d) The Underwriters shall have received
on the Closing Date an opinion of _____________, counsel for the
Underwriters, dated the Closing Date, covering such matters as you shall
reasonably require and in form and substance reason ably acceptable to you.
(e) The Underwriters 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
reasonably satisfactory to the Underwriters, from Xxxxxx Xxxxxxxx LLP,
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 incorporated by reference into the Prospectus.
(f) At the Closing Date, all conditions
precedent specified in the _____________ Agreement shall have been
satisfied; the representations and warranties of the Company, [the Owner
Trustee,] the Pass Through Trustee and the Indenture Trustee contained in
the _____________ Agreement shall be accurate as of the Closing Date
(except to the extent that they relate solely to an earlier date in which
case they shall be accurate as of such earlier date) and you shall have
received certificates of the Chief Financial Officer or the Treasurer of
the Company and appropriate officers of the respective [Owner Trustees,]
9
Pass Through Trustees and Indenture Trustees, dated as of the Closing
Date, to such effect; and you shall have received a copy of each opinion
required to be delivered under the _____________ Agreement and dated as of
the Closing Date, and addressed to you, and of such other documents
furnished in connection with the fulfillment of such conditions as you or
your counsel may reasonably request.
(g) At the Closing Date, counsel for the
Underwriters shall have been furnished with such documents and opinions as
such counsel may reasonably require.
6. Covenants of the Company. In further consideration of
the agreements of the Underwriters contained in this Agreement, the Company
covenants with each Underwriter as follows:
(a) To furnish to you in New York City,
without charge, as soon as available and during the period mentioned in
Section 6(c), as many copies of the Prospectus, any documents incorporated
by reference therein and any supplements and amendments thereto as you may
reasonably request.
(b) Before amending or supplementing the
Prospectus, 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 first
date of the public offering of the Securities as in the opinion of counsel
for the Underwriters the Prospectus is required by law to be delivered in
connection with sales by an Underwriter, any event shall occur as a result
of which it is necessary to amend or supplement the Prospectus in order to
make the statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Prospectus to comply with law,
forthwith to prepare and furnish, at its own expense, to the Underwriters,
either amendments or supplements to the Prospectus so that the statements
in the Prospectus as so amended or supplemented will not, in the light of
the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will
comply with law and to cause such amendments or supplements to be filed
promptly.
10
(d) To endeavor, in cooperation with the
Underwriters, to qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request, and to maintain such qualifications for so long as required for
the distribution of the Securities; provided, however, that the Company
shall not be obligated to file any general consent to service of process or
to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is
not otherwise so subject.
(e) Whether or not the transactions
contemplated in this Agreement are consummated or, subject to the last
paragraph of Section 9, 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 Prospectus and all amendments and
supplements thereto, including all printing costs associated therewith, and
the delivering of copies thereof to the Underwriters in the quantities
reasonably specified, (ii) all costs and expenses related to the
preparation, issuance, transfer and delivery of the Securities to the
Underwriters, including any transfer or other taxes payable thereon, (iii)
the cost of 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 Underwriters 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 any appropriate market
system, (vi) the costs and charges of the Trustee and any transfer agent,
registrar or depositary, and (vii) all other costs and expenses incident to
the performance of the obligations of the Company hereunder or under the
[Operative] [Fundamental] Documents for which provision is not otherwise
made in this Section. It is understood, however, that except as provided in
this Section 6, Section 7 and the last paragraph of Section 9, the
Underwriters will pay all of their costs and expenses, transfer taxes
payable on resale of any of the Securities by them and any advertising
expenses connected with any offers they may make.
7. Indemnity and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
11
Securities Act or Section 20 of the Exchange Act 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
Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto), or caused by any 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
Underwriter furnished to the Company in writing by such Underwriter through
you expressly for use therein.
(b) Each Underwriter 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 Underwriter, but only with reference to information relating to
such Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use in the Prospectus or any amendments or
supplements thereto.
(c) If any proceeding (including any
governmental investigation) shall be instituted involving any person in
respect of which indemnity may be sought pursuant to Section 7(a) or 7(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
12
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 ___________________, in the case of parties indemnified pursuant
to Section 7(a), and by the Company, in the case of parties indemnified
pursuant to Section 7(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 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 30 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 7(a) or 7(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 Underwriters on the other hand from the offering of the
Securities or (ii) if the allocation provided by clause 7(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 7(d)(i) above
but also the relative fault of the Company on the one hand and of the
Underwriters 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 Underwriters on the other
hand in connection with the offering of the Securities shall be deemed to
13
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 Underwriters, in each
case as set forth in the Prospectus, bear to the aggregate offering price
of the Securities. The relative fault of the Company on the one hand and of
the Underwriters 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 Underwriters and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Underwriters' respective obligations to contribute pursuant to this Section
7 are several in proportion to the respective principal amount of
Securities they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree
that it would not be just or equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable consider ations
referred to in Section 7(d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages and liabilities referred
to in Section 7(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 7, no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount
of any damages that such Underwriter 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 7 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 7 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
Underwriter or any person controlling any Underwriter or by or on behalf of
14
the Company, its officers or directors or any person controlling the
Company and (iii) acceptance of and payment for any of the Securities.
8. 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 Agree ment and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on or by
the New York Stock Exchange, (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
major hostilities in which the United States is involved or any change in
financial markets or any calamity or crisis that, in your reason able
judgment, is material and adverse and (b) in the case of any of the events
specified in clauses 8(a)(i) through 8(a)(iv), such event, singly or
together with any other such event, makes it, in your reasonable judgment,
impracticable to market the Securities on the terms and in the manner
contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement
shall become effective upon the execution and delivery hereof by the
parties hereto.
If, on the Closing Date, any one or more of the
Underwriters shall fail or refuse to purchase Securities that it or they
have agreed to purchase hereunder on such date, and the aggregate principal
amount of Securities which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of Securities to be purchased on such date, the
other Underwriters shall be obligated severally in the proportions that
the principal amount of Securities set forth opposite their respective
names in Schedule I bears to the aggregate principal amount of Securities
set forth opposite the names of all such non-defaulting Underwriters, or in
such other proportions as you may specify, to purchase the Securities which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date; provided that in no event shall the principal amount
of Securities that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 9 by an amount in excess of
one-ninth of such principal amount of Securities without the written
consent of such Underwriter. If, on the Closing Date any Underwriter or
Underwriters shall fail or refuse to purchase Securities which it or they
have agreed to purchase hereunder on such date and the aggregate principal
amount of Securities with respect to which such default occurs is more than
15
one-tenth of the aggregate principal amount of Securities to be purchased
on such date, and arrangements satisfactory to you and the Company for the
purchase of such Securities are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of
any non-defaulting Underwriter or of the Company. In any such case either
you or the Company shall have the right to postpone the Closing Date, but
in no event for longer than seven business days, in order that the required
changes, if any, in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall
not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the
Underwriters, 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, in either case other then in
connection with a termination specified in Section 8, the Company will
reimburse the Underwriters or such Underwriters 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 Underwriters in connection with this Agree ment or the
offering contemplated hereunder.
10. 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.
11. Applicable Law. THIS AGREEMENT SHALL BE GOV
ERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK.
12. 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.
Very truly yours,
UNITED AIR LINES, INC.
By: ___________________________
Name:
Title:
Accepted as of the date hereof
[Insert names of Underwriters]
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I.
-----------
By: __________________________________
By: __________________________________
Name:
Title:
16
SCHEDULE I
----------------------------------- --------------------------------------
Underwriter Principal Amount of
Securities to be Purchased
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
----------------------------------- --------------------------------------
Total: _______________________________
17
Exhibit A-1
to
Underwriting
Agreement
(Pass Through Certificates, Series ____-_)
[Provisions of Opinion of
_____________]
18
Exhibit A-2
to
Underwriting
Agreement
(Pass Through Certificates, Series ____-_)
[Provisions of Opinion of General Counsel or Assistant
General Counsel of United Air Lines, Inc.]
19
Exhibit A-3
to
Underwriting
Agreement
(Pass Through Certificates, Series ____-_)
[Provisions of Opinion of ____________________]
20
