Exhibit 4(a)(ix)
[GRAPHIC OMITTED]
INTERCREDITOR AGREEMENT
Dated as of
August 31, 0000
XXXXX
XXXXX XXXXXX BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
not in its individual capacity
but solely as Trustee under the
XX Xxxxxxx Xxxx Xxxxxxx Xxxxx 0000-0X,
XX Xxxxxxx Xxxx Through Trust 1999-1B
and
US Airways Pass Through Trust 1999-1C
AIG MATCHED FUNDING CORP.
as Class A Liquidity Provider,
as Class B Liquidity Provider,
and
as Class C Liquidity Provider
AND
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
not in its individual capacity except
as expressly set forth herein but
solely as Subordination Agent and Trustee
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS....................................2
SECTION 1.1. Definitions.............................2
ARTICLE II TRUST ACCOUNTS; CONTROLLING PARTY............21
SECTION 2.1. Agreement to Terms of Subordination;
Payments from Monies Received Only.....21
SECTION 2.2. Trust Accounts.........................22
SECTION 2.3. Deposits to the Collection Account
and Special Payments Account...........23
SECTION 2.4. Distributions of Special Payments......23
SECTION 2.5. Designated Representatives.............26
SECTION 2.6. Controlling Party......................27
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED.........................................28
SECTION 3.1. Written Notice of Distribution.........28
SECTION 3.2. Distribution of Amounts on Deposit
in the Collection Account..............31
SECTION 3.3. Distribution of Amounts on Deposit
Following a Triggering Event...........32
SECTION 3.4. Other Payments.........................34
SECTION 3.5. Payments to the Trustees and the
Liquidity Providers....................35
ARTICLE IV EXERCISE OF REMEDIES.........................42
SECTION 4.1. Directions from the Controlling Party..42
SECTION 4.2. Remedies Cumulative....................44
SECTION 4.3. Discontinuance of Proceedings..........44
SECTION 4.4. Right of Certificateholders to
Receive Payments Not to Be Impaired....44
SECTION 4.5. Undertaking for Costs..................45
ARTICLE V DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS
OF TRUSTEES, ETC.........................................45
SECTION 5.1. Notice of Indenture Default or
Triggering Event.......................45
SECTION 5.2. Indemnification........................45
SECTION 5.3. No Duties Except as Specified in
Intercreditor Agreement................46
SECTION 5.4. Notice from the Liquidity Providers
and Trustees...........................46
ARTICLE VI THE SUBORDINATION AGENT......................46
SECTION 6.1. Authorization; Acceptance of Trusts
and Duties.............................46
SECTION 6.2. Absence of Duties......................47
SECTION 6.3. No Representations or Warranties as
to Documents...........................47
SECTION 6.4. No Segregation of Monies; No Interest..47
SECTION 6.5. Reliance; Agents; Advice of Counsel....47
SECTION 6.6. Capacity in Which Acting...............48
SECTION 6.7. Compensation...........................48
SECTION 6.8. May Become Certificateholder...........48
SECTION 6.9. Subordination Agent Required;
Eligibility............................48
SECTION 6.10. Money to Be Held in Trust.............49
ARTICLE VII INDEMNIFICATION OF SUBORDINATION AGENT......49
SECTION 7.1. Scope of Indemnification...............49
ARTICLE VIII SUCCESSOR SUBORDINATION AGENT..............50
SECTION 8.1. Replacement of Subordination Agent;
Appointment of Successor...............50
ARTICLE IX SUPPLEMENTS AND AMENDMENTS...................51
SECTION 9.1. Amendments, Waivers, etc...............51
SECTION 9.3. Effect of Supplemental Agreements......52
SECTION 9.4. Notice to Rating Agencies..............52
ARTICLE X MISCELLANEOUS.................................53
SECTION 10.1. Termination of Intercreditor
Agreement.............................53
SECTION 10.2. Intercreditor Agreement for Benefit
of Trustees, Liquidity Providers and
Subordination Agent...................53
SECTION 10.3. Notices...............................53
SECTION 10.4. Severability..........................55
SECTION 10.5. No Oral Modifications or
Continuing Waivers....................55
SECTION 10.6. Successors and Assigns................55
SECTION 10.7. Headings..............................55
SECTION 10.8. Counterpart Form......................55
SECTION 10.9. Subordination.........................55
SECTION 10.10. Governing Law........................57
SECTION 10.11. Submission to Jurisdiction;
Waiver of Jury Trial; Waiver
of Immunity..........................57
INTERCREDITOR AGREEMENT
INTERCREDITOR AGREEMENT dated as of August 31, 1999, among
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a
national banking association ("State Street"), not in its individual
capacity but solely as Trustee of each Trust (each as defined below); AIG
MATCHED FUNDING CORP, a corporation organized under the laws of the State
of Delaware ("AIGMFC"), as Class A Liquidity Provider, Class B Liquidity
Provider and Class C Liquidity Provider; and STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking
association, not in its individual capacity except as expressly set forth
herein, but solely as Subordination Agent and trustee hereunder (in such
capacity, together with any successor appointed pursuant to Article VIII
hereof, the "Subordination Agent").
WHEREAS, all capitalized terms used herein shall have the
respective meanings referred to in Article I hereof;
WHEREAS, pursuant to each Indenture (i) in the case of each
Aircraft that is owned by US Airways at the time such Indenture is entered
into (the "Owned Aircraft"), US Airways will issue on a recourse basis
three series of Equipment Notes to finance the purchase of such Aircraft,
and (ii) in the case of each Aircraft that is leased to US Airways pursuant
to a related Lease at the time such Indenture is entered into (the "Leased
Aircraft"), the related Owner Trustee will issue on a nonrecourse basis
three series of Equipment Notes to finance the purchase of such Aircraft;
WHEREAS, pursuant to the Financing Agreements, each Trust
will acquire Equipment Notes having an interest rate equal to the interest
rate applicable to the Certificates to be issued by such Trust;
WHEREAS, pursuant to each Trust Agreement, the Trust created
thereby proposes to issue a single class of Certificates (a "Class")
bearing the interest rate and having the final distribution date described
in such Trust Agreement on the terms and subject to the conditions set
forth therein;
WHEREAS, pursuant to the Underwriting Agreement, the
Underwriters propose to purchase the Certificates issued by the Class A
Trust and the Class B Trust in the aggregate face amount set forth opposite
the name of such Trust on Schedule I thereto on the terms and subject to
the conditions set forth therein;
WHEREAS, pursuant to the Class C Purchase Agreement, Airbus
Industrie Financial Services ("AIFS") proposes to purchase all of the
Certificates issued by the Class C Trust on the terms and subject to the
conditions set forth therein;
WHEREAS, the Liquidity Provider proposes to enter into three
separate revolving credit agreements with the Subordination Agent, as agent
for the Trustee of each of the Class A Trust, the Class B Trust and the
Class C Trust, respectively, for the benefit of the Certificateholders of
such Trust; and
WHEREAS, it is a condition precedent to the obligations of
the Underwriters under the Underwriting Agreement that the Subordination
Agent, the Trustees and the Liquidity Providers agree to the terms of
subordination set forth in this Agreement in respect of each Class of
Certificates, and the Subordination Agent, the Trustees and the Liquidity
Provider, by entering into this Agreement, hereby acknowledge and agree to
such terms of subordination and the other provisions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, and of other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:
(1) the terms used herein that are defined in this Article
have the meanings assigned to them in this Article, and include the
plural as well as the singular;
(2) all references in this Agreement to designated
"Articles", "Sections" and other subdivisions are to the designated
Articles, Sections and other subdivisions of this Agreement;
(3) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not
to any particular Article, Section or other subdivision; and
(4) the term "including" shall mean "including without
limitation".
"Acceleration" means, with respect to the amounts payable in
respect of the Equipment Notes issued under any Indenture, such amounts
becoming immediately due and payable by declaration or otherwise.
"Accelerate", "Accelerated" and "Accelerating" have meanings correlative to
the foregoing.
"Adjusted Expected Distributions" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates (excluding interest, if
any, payable with respect to the Deposits related to such Trust)
and (y) the greater of:
(A) the difference between (x) the Pool Balance of such
Certificates as of the immediately preceding Distribution Date (or,
if the Current Distribution Date is the first Distribution Date,
the original aggregate face amount of the Certificates of such
Trust) and (y) the Pool Balance of such Certificates as of the
Current Distribution Date calculated on the basis that (i) the
principal of the Non-Performing Equipment Notes held in such Trust
has been paid in full and such payments have been distributed to
the holders of such Certificates, (ii) the principal of the
Performing Equipment Notes held in such Trust has been paid when
due (but without giving effect to any Acceleration of Performing
Equipment Notes) and such payments have been distributed to the
holders of such Certificates and (iii) the principal of any
Equipment Notes formerly held in such Trust that have been sold
pursuant to the terms hereof has been paid in full and such
payments have been distributed to the holders of such Certificates,
but without giving effect to any reduction in the Pool Balance as a
result of any distribution attributable to Deposits occurring after
the immediately preceding Distribution Date (or, if the Current
Distribution Date is the first Distribution Date, occurring after
the initial issuance of the Certificates of such Trust), and
(B) the amount of the excess, if any, of (i) the Pool
Balance of such Class of Certificates as of the immediately
preceding Distribution Date (or, if the Current Distribution Date
is the first Distribution Date, the original aggregate face amount
of the Certificates of such Trust), less the amount of the Deposits
for such Class of Certificates as of such preceding Distribution
Date (or, if the Current Distribution Date is the first
Distribution Date, the original aggregate amount of the Deposits
for such Class of Certificates) other than any portion of such
Deposits thereafter used to acquire Equipment Notes pursuant to the
Note Purchase Agreement, over (ii) the Aggregate LTV Collateral
Amount for such Class of Certificates for the Current Distribution
Date;
provided that, until the date of the initial LTV Appraisals, clause (B)
shall not apply.
For purposes of calculating Adjusted Expected Distributions
with respect to the Certificates of any Trust, any premium paid on the
Equipment Notes held in such Trust that has not been distributed to the
Certificateholders of such Trust (other than such premium or a portion
thereof applied to the payment of interest on the Certificates of such
Trust or the reduction of the Pool Balance of such Trust) shall be added to
the amount of Adjusted Expected Distributions.
"Advance", with respect to any Liquidity Facility, means any
Advances as defined in such Liquidity Facility.
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by or under common
control with such Person. For the purposes of this definition, "control"
means the power, directly or indirectly, to direct or cause the direction
of the management and policies of such Person whether through the ownership
of voting securities or by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Aggregate LTV Collateral Amount" for any Class of
Certificates for any Distribution Date means the sum of the applicable LTV
Collateral Amounts for each Leased Aircraft and Owned Aircraft, minus the
Pool Balance for each Class of Certificates, if any, senior to such Class,
after giving effect to any distribution of principal on such Distribution
Date with respect to such senior Class or Classes.
"AIFS" has the meaning assigned to such term in the recitals
to this Agreement.
"Aircraft" means, with respect to each Indenture, the
"Aircraft" referred to therein.
"Appraisal" means a current fair market value appraisal
(which may be a "desktop" appraisal) performed by any Appraiser or any
other nationally recognized appraiser on the basis of an arm's-length
transaction between an informed and willing purchaser under no compulsion
to buy and an informed and willing seller under no compulsion to sell and
both having knowledge of all relevant facts.
"Appraised Current Market Value" of any Leased Aircraft or
Owned Aircraft means the lower of the average and the median of the three
most recent Appraisals of such Aircraft.
"Appraisers" means Aircraft Information Services, Inc.,
AvSolutions, Inc. and Xxxxxx Xxxxx and Xxxxx, Inc.
"Available Amount" means, with respect to any Liquidity
Facility on any drawing date, subject to the proviso contained in the first
sentence of Section 3.6(g) hereof, an amount equal to (a) the Stated Amount
of such Liquidity Facility at such time, less (b) the aggregate amount of
each Interest Drawing honored by the Liquidity Provider under such
Liquidity Facility on or prior to such date which has not been reimbursed
or reinstated as of such date; provided that, following a Downgrade
Drawing, a Non-Extension Drawing or a Final Drawing under such Liquidity
Facility, the Available Amount of such Liquidity Facility shall be zero.
"Basic Agreement" means the Pass Through Trust Agreement
dated as of July 30, 1999 between US Airways, Inc., US Airways Group, Inc.,
and State Street Bank and Trust Company of Connecticut, National
Association.
"Business Day" means any day other than a Saturday or Sunday
or a day on which commercial banks are required or authorized to close in
Pittsburgh, Pennsylvania, New York, New York, or, so long as any
Certificate is outstanding, the city and state in which any Trustee, the
Subordination Agent or any Loan Trustee maintains its Corporate Trust
Office or receives and disburses funds, and that, solely with respect to
draws under any Liquidity Facility, also is a "Business Day" as defined in
such Liquidity Facility.
"Cash Collateral Account" means the Class A Cash Collateral
Account, the Class B Cash Collateral Account or the Class C Cash Collateral
Account, as applicable.
"Certificate" means a Class A Certificate, a Class B
Certificate or a Class C Certificate, as applicable.
"Certificateholder" means any holder of one or more
Certificates.
"Class" has the meaning assigned to such term in the
preliminary statements to this Agreement.
"Class A Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify,
into which all amounts drawn under the Class A Liquidity Facility pursuant
to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class A Certificateholder" means, at any time, any holder
of one or more Class A Certificates.
"Class A Certificates" means the certificates issued by the
Class A Trust, substantially in the form of Exhibit A to the Class A Trust
Agreement, and authenticated by the Class A Trustee, representing
fractional undivided interests in the Class A Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of
the Class A Trust Agreement.
"Class A Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination
Agent, as agent and trustee for the Class A Trustee, and the initial Class
A Liquidity Provider and, from and after the replacement of such agreement
pursuant hereto, the Replacement Liquidity Facility therefor, if any, in
each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class A Liquidity Provider" means AIGMFC , together with
any Replacement Liquidity Provider which has issued a Replacement Liquidity
Facility to replace any Class A Liquidity Facility pursuant to Section
3.6(e).
"Class A Trust" means the US Airways Pass Through Trust
1999-1A created and administered pursuant to the Class A Trust Agreement.
"Class A Trust Agreement" means the Basic Agreement, as
supplemented by the Supplement No. 1999-1A thereto dated as of the date
hereof, governing the creation and administration of the US Airways Pass
Through Trust 1999-1A and the issuance of the Class A Certificates, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class A Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except
as expressly set forth in the Class A Trust Agreement, but solely as
trustee under the Class A Trust Agreement, together with any successor
trustee appointed pursuant thereto.
"Class B Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify,
into which all amounts drawn under the Class B Liquidity Facility pursuant
to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class B Certificateholder" means, at any time, any holder
of one or more Class B Certificates.
"Class B Certificates" means the certificates issued by the
Class B Trust, substantially in the form of Exhibit A to the Class B Trust
Agreement, and authenticated by the Class B Trustee, representing
fractional undivided interests in the Class B Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of
the Class B Trust Agreement.
"Class B Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination
Agent, as agent and trustee for the Class B Trustee, and the initial Class
B Liquidity Provider, and, from and after the replacement of such Agreement
pursuant hereto, the Replacement Liquidity Facility therefor, if any, in
each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class B Liquidity Provider" means AIGMFC , together with
any Replacement Liquidity Provider which has issued a Replacement Liquidity
Facility to replace any Class B Liquidity Facility pursuant to Section
3.6(e).
"Class B Trust" means the US Airways Pass Through Trust
1999-1B created and administered pursuant to the Class B Trust Agreement.
"Class B Trust Agreement" means the Basic Agreement, as
supplemented by the Supplement No. 1999-1B thereto dated as of the date
hereof, governing the creation and administration of the US Airways Pass
Through Trust 1999-1B and the issuance of the Class B Certificates, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class B Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except
as expressly set forth in the Class B Trust Agreement, but solely as
trustee under the Class B Trust Agreement, together with any successor
trustee appointed pursuant thereto.
"Class C Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify,
into which all amounts drawn under the Class C Liquidity Facility pursuant
to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class C Certificateholder" means, at any time, any holder
of one or more Class C Certificates.
"Class C Certificates" means the certificates issued by the
Class C Trust, substantially in the form of Exhibit A to the Class C Trust
Agreement, and authenticated by the Class C Trustee, representing
fractional undivided interests in the Class C Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of
the Class C Trust Agreement.
"Class C Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination
Agent, as agent and trustee for the Class C Trustee, and the initial Class
C Liquidity Provider, and, from and after the replacement of such Agreement
pursuant hereto, the Replacement Liquidity Facility therefor, if any, in
each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class C Liquidity Provider" means AIGMFC , together with
any Replacement Liquidity Provider which has issued a Replacement Liquidity
Facility to replace any Class C Liquidity Facility pursuant to Section
3.6(e).
"Class C Purchase Agreement" means the Purchase Agreement
dated August 31, 1999 between US Airways and AIFS relating to the purchase
of all of the Class C Certificates by AIFS, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Class C Trust" means the US Airways Pass Through Trust
1999-1C created and administered pursuant to the Class C Trust Agreement.
"Class C Trust Agreement" means the Basic Agreement, as
supplemented by the Supplement No. 1999-1C thereto dated as of the date
hereof, governing the creation and administration of the US Airways Pass
Through Trust 1999-1C and the issuance of the Class C Certificates, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class C Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except
as expressly set forth in the Class C Trust Agreement, but solely as
trustee under the Class C Trust Agreement, together with any successor
trustee appointed pursuant thereto.
"Closing Date" means August 31, 1999.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder.
"Collection Account" means the Eligible Deposit Account
established by the Subordination Agent pursuant to Section 2.2 which the
Subordination Agent shall make deposits in and withdrawals from in
accordance with this Agreement.
"Controlling Party" means the Person entitled to act as such
pursuant to the terms of Section 2.6.
"Corporate Trust Office" means, with respect to any Trustee,
the Subordination Agent or any Loan Trustee, the office of such Person in
the city at which, at any particular time, its corporate trust business
shall be principally administered.
"Current Distribution Date" means a Distribution Date
specified as a reference date for calculating the Expected Distributions or
the Adjusted Expected Distributions with respect to the Certificates of any
Trust as of such Distribution Date.
"Delivery Period Expiry Date" means the earlier of (a) July
20, 2000, and (b) the date on which Equipment Notes with respect to all New
Aircraft (or Substitute Aircraft in lieu thereof) have been purchased by
the Trusts in accordance with the Note Purchase Agreement.
"Deposit Agreement" shall mean, with respect to any Class,
the Deposit Agreement pertaining to such Class dated the date hereof
between the Escrow Agent, and the Depositary, as the same may be amended,
modified or supplemented from time to time in accordance with the terms
thereof.
"Depositary" means ABN AMRO Bank N.V., acting through its
Chicago branch, as depositary under each Deposit Agreement.
"Deposits" with respect to any Class, shall have the meaning
set forth in the Deposit Agreement pertaining to such Class.
"Designated Representatives" means the Subordination Agent
Representatives, the Trustee Representatives and the LP Representatives
identified under Section 2.5.
"Distribution Date" means a Regular Distribution Date or a
Special Distribution Date.
"Dollars" or "$" means United States dollars.
"Downgrade Drawing" has the meaning assigned to such term in
Section 3.6(c).
"Downgraded Facility" has the meaning assigned to such term
in Section 3.6(c).
"Drawing" means an Interest Drawing, a Final Drawing, a
Non-Extension Drawing or a Downgrade Drawing, as the case may be.
"Eligible Deposit Account" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with
the corporate trust department of a depository institution organized under
the laws of the United States of America or any one of the states thereof
or the District of Columbia (or any U.S. branch of a foreign bank), having
corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the securities of such depository institution
has a long-term unsecured debt rating from each Rating Agency of at least
A-3 or its equivalent. An Eligible Deposit Account may be maintained with a
Liquidity Provider so long as such Liquidity Provider is an Eligible
Institution; provided that such Liquidity Provider shall have waived all
rights of set-off and counterclaim with respect to such account.
"Eligible Institution" means (a) the corporate trust
department of the Subordination Agent or any Trustee, as applicable, or (b)
a depository institution organized under the laws of the United States of
America or any one of the states thereof or the District of Columbia (or
any U.S. branch of a foreign bank), which has a long-term unsecured debt
rating from each Rating Agency of at least A-3 or its equivalent.
"Eligible Investments" means (a) investments in obligations
of, or guaranteed by, the United States Government having maturities no
later than 90 days following the date of such investment, (b) investments
in open market commercial paper of any corporation incorporated under the
laws of the United States of America or any state thereof with a short-term
unsecured debt rating issued by Xxxxx'x and S&P of at least A-1 and P-1,
respectively, having maturities no later than 90 days following the date of
such investment or (c) investments in negotiable certificates of deposit,
time deposits, banker's acceptances, commercial paper or other direct
obligations of, or obligations guaranteed by, commercial banks organized
under the laws of the United States or of any political subdivision thereof
(or any U.S. branch of a foreign bank) with issuer ratings of at least B/C
by Thomson Bankwatch, having maturities no later than 90 days following the
date of such investment; provided, however, that (x) all Eligible
Investments that are bank obligations shall be denominated in U.S. dollars;
and (y) the aggregate amount of Eligible Investments at any one time that
are bank obligations issued by any one bank shall not be in excess of 5% of
such bank's capital surplus; provided further that (1) any investment of
the types described in clauses (a), (b) and (c) above may be made through a
repurchase agreement in commercially reasonable form with a bank or other
financial institution qualifying as an Eligible Institution so long as such
investment is held by a third party custodian also qualifying as an
Eligible Institution, and (2) all such investments set forth in clause (a),
(b) or (c) above mature no later than the Business Day immediately
preceding the next Regular Distribution Date; provided further, however,
that in the case of any Eligible Investment issued by a domestic branch of
a foreign bank, the income from such investment shall be from sources
within the United States for purposes of the Code. Notwithstanding the
foregoing, no investment of the types described in clause (b) above which
is issued or guaranteed by US Airways or any of its respective Affiliates,
and no investment in the obligations of any one bank in excess of
$10,000,000, shall be an Eligible Investment unless written confirmation
shall have been received from each Rating Agency that the making of such
investment will not results in a withdrawal or downgrading of the ratings
of the Certificates.
"Equipment Notes" means, at any time, the Series A Equipment
Notes, the Series B Equipment Notes and the Series C Equipment Notes,
collectively, and in each case, any Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of the Indentures.
"Escrow Agent" means First Security Bank, National
Association, as escrow agent under each Escrow and Paying Agent Agreement,
together with its successors in such capacity.
"Escrow and Paying Agent Agreement" shall mean, with respect
to any Class, the Escrow and Paying Agent Agreement pertaining to such
Class dated as of the date hereof between the Escrow Agent, the
Underwriters (in the case of the Class A Certificates and the Class B
Certificates) or AIFS (in the case of the Class C Certificates), the
Trustee for such Class and the Paying Agent, as the same may be amended,
modified or supplemented from time to time in accordance with the terms
thereof.
"Expected Distributions" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates (excluding interest, if
any, payable with respect to the Deposits related to such Trust) and (y)
the difference between (A) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (or, if the Current Distribution
Date is the first Distribution Date, the original aggregate face amount of
the Certificates of such Trust) and (B) the Pool Balance of such
Certificates as of the Current Distribution Date calculated on the basis
that (i) the principal of the Equipment Notes held in such Trust has been
paid when due (whether at stated maturity or upon redemption, prepayment,
purchase, Acceleration or otherwise) and such payments have been
distributed to the holders of such Certificates and (ii) the principal of
any Equipment Notes formerly held in such Trust that have been sold
pursuant to the terms hereof has been paid in full and such payments have
been distributed to the holders of such Certificates, but without giving
effect to any reduction in the Pool Balance as a result of any distribution
attributable to Deposits occurring after the immediately preceding
Distribution Date (or, if the Current Distribution Date is the first
Distribution Date, occurring after the initial issuance of the Certificates
of such Trust). For purposes of calculating Expected Distributions with
respect to the Certificates of any Trust, any premium paid on the Equipment
Notes held in such Trust which has not been distributed to the
Certificateholders of such Trust (other than such premium or a portion
thereof applied to the payment of interest on the Certificates of such
Trust or the reduction of the Pool Balance of such Trust) shall be added to
the amount of such Expected Distributions.
"Expiry Date" with respect to any Liquidity Facility, shall
have the meaning set forth in such Liquidity Facility.
"Facility Office" means, with respect to any Liquidity
Facility, the Facility Office of the Liquidity Provider thereunder,
presently located at Westport, Connecticut for AIGMFC, or such other
Facility Office as such Liquidity Provider from time to time shall notify
the applicable Trustee as its Facility Office under any such Liquidity
Facility, provided that such Liquidity Provider shall not change its
Facility Office to a Facility Office outside the United States of America
except in accordance with Section 3.01, 3.02 or 3.03 of any such Liquidity
Facility.
"Fee Letter" means the Fee Letter dated as of the date
hereof between AIGMFC and the Subordination Agent with respect to the
initial Liquidity Facilities and any fee letter entered into between the
Subordination Agent and any Replacement Liquidity Provider.
"Final Distributions" means, with respect to the
Certificates of any Trust on any Distribution Date, the sum of (x) the
aggregate amount of all accrued and unpaid interest on such Certificates
(excluding interest, if any, payable with respect to the Deposits relating
to such Trust) and (y) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (less the amount of the Deposits
for such Class of Certificates as of such preceding Distribution Date other
than any portion of such Deposits thereafter used to acquire Equipment
Notes pursuant to the Note Purchase Agreement). For purposes of calculating
Final Distributions with respect to the Certificates of any Trust, any
premium paid on the Equipment Notes held in such Trust which has not been
distributed to the Certificateholders of such Trust (other than such
premium or a portion thereof applied to the payment of interest on the
Certificates of such Trust or the reduction of the Pool Balance of such
Trust) shall be added to the amount of such Final Distributions.
"Final Drawing" has the meaning assigned to such term in
Section 3.6(i).
"Final Legal Distribution Date" means (i) with respect to
the Class A Certificates, July 20, 2020, (ii) with respect to the Class B
Certificates, July 20, 2020, and (iii) with respect to the Class C
Certificates, July 20, 2019.
"Financing Agreement" means each of the Participation
Agreements and the Note Purchase Agreement.
"Indenture" means each of the Trust Indentures entered into
by the Loan Trustee, and the Owner Trustee or US Airways, pursuant to the
Note Purchase Agreement, in each case as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Indenture Default" means, with respect to any Indenture,
any Event of Default (as such term is defined in such Indenture)
thereunder.
"Interest Drawing" has the meaning assigned to such term in
Section 3.6(a).
"Interest Payment Date" means, with respect to any Liquidity
Facility, each date on which interest is due and payable under Section
3.07(c) or 3.07(d) of such Liquidity Facility on a Downgrade Drawing,
Non-Extension Drawing or Final Drawing.
"Investment Earnings" means investment earnings on funds on
deposit in the Trust Accounts net of losses and investment expenses of the
Subordination Agent in making such investments.
"Lease" means, with respect to each Indenture pertaining to
a Leased Aircraft, the "Lease" referred to therein.
"Leased Aircraft" has the meaning assigned to such term in
the preliminary statements of this Agreement.
"Lien" means any mortgage, pledge, lien, charge, claim,
disposition of title, encumbrance, lease, sublease, sub-sublease or
security interest of any kind, including, without limitation, any thereof
arising under any conditional sales or other title retention agreement.
"Liquidity Event of Default" with respect to any Liquidity
Facility, has the meaning assigned to such term in such Liquidity Facility.
"Liquidity Expenses" means all Liquidity Obligations other
than (i) the principal amount of any Drawings under the Liquidity
Facilities and (ii) any interest accrued on any Liquidity Obligations.
"Liquidity Facility" means, at any time, the Class A
Liquidity Facility, the Class B Liquidity Facility or the Class C Liquidity
Facility.
"Liquidity Obligations" means all principal, interest, fees
and other amounts owing to the Liquidity Providers under the Liquidity
Facilities, Section 6(c) of the Participation Agreements or the Fee Letter.
"Liquidity Provider" means, at any time, any Class A
Liquidity Provider, any Class B Liquidity Provider or any Class C Liquidity
Provider, as applicable.
"Loan Trustee" means, with respect to any Indenture, the
loan trustee thereunder.
"LP Incumbency Certificate" has the meaning assigned to such
term in Section 2.5(c).
"LP Representatives" has the meaning assigned to such term
in Section 2.5(c).
"LTV Appraisals" has the meaning assigned to such term in
Section 4.1(a).
"LTV Collateral Amount" of any Leased Aircraft or Owned
Aircraft for any Class of Certificates means, as of any Distribution Date,
the lesser of (i) the LTV Ratio for such Class of Certificates multiplied
by the Appraised Current Market Value of such Aircraft (or with respect to
any such Aircraft which has suffered an Event of Loss under and as defined
in the relevant Lease (in the case of a Leased Aircraft) or Indenture (in
the case of an Owned Aircraft), the amount of the insurance proceeds paid
to the related Loan Trustee in respect thereof to the extent then held by
such Loan Trustee (and/or on deposit in the Special Payments Account) or
payable to such Loan Trustee in respect thereof) and (ii) the outstanding
principal amount of the Equipment Notes secured by such Aircraft after
giving effect to any principal payments of such Equipment Notes on or
before such Distribution Date.
"LTV Ratio" means for the Class A Certificates 40.8%, for
the Class B Certificates 50.0% and for the Class C Certificates 63.0%.
"Minimum Sale Price" means, with respect to any Aircraft or
the Equipment Notes issued in respect of such Aircraft, at any time, the
lesser of (a) 75% of the Appraised Current Market Value of such Aircraft
and (b) the aggregate outstanding principal amount of such Equipment Notes,
plus accrued and unpaid interest thereon.
"Moody's" means Xxxxx'x Investors Service, Inc.
"New Aircraft" shall have the meaning set forth in the Note
Purchase Agreement.
"Non-Controlling Party" means, at any time, any Trustee or
Liquidity Provider which is not the Controlling Party at such time.
"Non-Extended Facility" has the meaning assigned to such
term in Section 3.6(d).
"Non-Extension Drawing" has the meaning assigned to such
term in Section 3.6(d).
"Non-Performing Equipment Note" means an Equipment Note
issued pursuant to an Indenture that is not a Performing Equipment Note.
"Note Purchase Agreement" means the Note Purchase Agreement
dated as of the date hereof, among US Airways, each Trustee, the Escrow
Agent, the Subordination Agent and the Paying Agent.
"Officer's Certificate" of any Person means a certification
signed by a Responsible Officer of such Person.
"Operative Agreements" means this Agreement, the Liquidity
Facilities, the Indentures, the Trust Agreements, the Underwriting
Agreement, the Class C Purchase Agreement, the Financing Agreements, the
Leases, the Fee Letter, the Equipment Notes and the Certificates, together
with all exhibits and schedules included with any of the foregoing and each
of the other documents and instruments referred to in the definitions of
"Operative Documents" contained in the Leases or, in the case of any Owned
Aircraft, the relevant Indenture.
"Outstanding" means, when used with respect to each Class of
Certificates, as of the date of determination, all Certificates of such
Class theretofore authenticated and delivered under the related Trust
Agreement, except:
(i) Certificates of such Class theretofore canceled by the
Registrar (as defined in such Trust Agreement) or delivered to the
Trustee thereunder or such Registrar for cancellation;
(ii) Certificates of such Class for which money in the full
amount required to make the final distribution with respect to such
Certificates pursuant to Section 11.01 of such Trust Agreement has
been theretofore deposited with the related Trustee in trust for
the holders of such Certificates as provided in Section 4.01 of
such Trust Agreement pending distribution of such money to such
Certificateholders pursuant to such final distribution payment; and
(iii) Certificates of such Class in exchange for or in lieu
of which other Certificates have been authenticated and delivered
pursuant to such Trust Agreement;
provided, however, that in determining whether the holders of the requisite
Outstanding amount of such Certificates have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, any
Certificates owned by US Airways or any of its Affiliates shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether such Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only
Certificates that such Trustee knows to be so owned shall be so
disregarded. Certificates so owned that have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction
of the applicable Trustee the pledgee's right so to act with respect to
such Certificates and that the pledgee is not US Airways or any of its
Affiliates.
"Overdue Scheduled Payment" means any Scheduled Payment
which is not in fact received by the Subordination Agent within five days
after the Scheduled Payment Date relating thereto.
"Owned Aircraft" has the meaning assigned to such term in
the preliminary statements of this Agreement.
"Owner Trustee" means, with respect to any Indenture
pertaining to a Leased Aircraft, the Owner Trustee (as defined therein) not
in its individual capacity but solely as trustee under the related owner
trust agreement, together with any successor trustee appointed pursuant
to such owner trust agreement.
"Participation Agreement" means, with respect to each
Indenture, the "Participation Agreement" referred to therein.
"Payee" has the meaning assigned to such term in Section
2.4(e).
"Paying Agent" means State Street Bank and Trust Company of
Connecticut, National Association, as paying agent under each Escrow and
Paying Agent Agreement, together with its successors in such capacity.
"Performing Equipment Note" means an Equipment Note issued
pursuant to an Indenture with respect to which no payment default has
occurred and is continuing (without giving effect to any Acceleration);
provided that in the event of a bankruptcy proceeding involving US Airways
under Title 11 of the United States Code (the "Bankruptcy Code"), (i) any
payment default existing during the 60-day period under Section
1110(a)(1)(A) of the Bankruptcy Code (or such longer period as may apply
under Section 1110(b) of the Bankruptcy Code) (the "Section 1110 Period")
shall not be taken into consideration, unless during the Section 1110
Period the trustee in such proceeding or US Airways refuses to assume or
agree to perform its obligations under the Lease related to such Equipment
Note (in the case of a Leased Aircraft) or under the Indenture related to
such Equipment Note (in the case of an Owned Aircraft) and (ii) any payment
default occurring after the date of the order of relief in such proceeding
shall not be taken into consideration if such payment default is cured
under Section 1110(a)(1)(B) of the Bankruptcy Code before the later of 30
days after the date of such default or the expiration of the Section 1110
Period.
"Performing Note Deficiency" means any time that less than
65% of the then aggregate outstanding principal amount of all Equipment
Notes are Performing Equipment Notes.
"Person" means any individual, corporation, partnership,
joint venture, association, limited liability company, joint-stock company,
trust, trustee, unincorporated organization or government or any agency or
political subdivision thereof.
"Pool Balance" means, with respect to each Trust or the
Certificates issued by any Trust, as of any date, (i) the original
aggregate face amount of the Certificates of such Trust less (ii) the
aggregate amount of all payments made in respect of the Certificates of
such Trust or in respect of Deposits relating to such Trust other than
payments made in respect of interest or premium thereon or reimbursement of
any costs and expenses in connection therewith. The Pool Balance for each
Trust or for the Certificates issued by any Trust as of any Distribution
Date shall be computed after giving effect to any special distribution with
respect to unused Deposits, payment of principal of the Equipment Notes or
payment with respect to other Trust Property held in such Trust and the
distribution thereof to be made on that date.
"Proceeding" means any suit in equity, action at law or
other judicial or administrative proceeding.
"PTC Event of Default" means, with respect to each Trust
Agreement, the failure to pay within 10 Business Days of the due date
thereof: (i) the outstanding Pool Balance of the applicable Class of
Certificates on the Final Legal Distribution Date for such Class or (ii)
interest due on such Certificates on any Distribution Date (unless the
Subordination Agent shall have made an Interest Drawing, or a withdrawal
from the Cash Collateral Account, with respect thereto in an aggregate
amount sufficient to pay such interest and shall have distributed such
amount to the Trustee entitled thereto).
"Rating Agencies" means, collectively, at any time, each
nationally recognized rating agency which shall have been requested by US
Airways to rate the Certificates and which shall then be rating the
Certificates. The initial Rating Agencies will be Moody's and Standard &
Poor's.
"Ratings Confirmation" means, with respect to any action
proposed to be taken, a written confirmation from each of the Rating
Agencies that such action would not result in (i) a reduction of the rating
for any Class of Certificates below the then current rating for such Class
of Certificates or (ii) a withdrawal or suspension of the rating of any
Class of Certificates.
"Regular Distribution Dates" means each January 20 and July
20, commencing on January 20, 2000; provided, however, that, if any such
day shall not be a Business Day, the related distribution shall be made on
the next succeeding Business Day without additional interest.
"Replacement Liquidity Facility" means, for any Liquidity
Facility, an irrevocable revolving credit agreement (or agreements) in
substantially the form of the replaced Liquidity Facility, including
reinstatement provisions, or in such other form (which may include a letter
of credit) as shall permit the Rating Agencies to confirm in writing their
respective ratings then in effect for the related Certificates (before
downgrading of such ratings, if any, as a result of the downgrading of the
applicable Liquidity Provider), in a face amount (or in an aggregate face
amount) equal to the amount of interest payable on the Certificates of such
Trust (at the Stated Interest Rate for such Trust, and without regard to
expected future principal payments) on the three Regular Distribution Dates
following the date of replacement of such Liquidity Facility and issued by
a Person (or Persons) having unsecured short-term debt ratings issued by
both Rating Agencies which are equal to or higher than the Threshold
Rating. Without limitation of the form that a Replacement Liquidity
Facility otherwise may have pursuant to the preceding sentence, a
Replacement Liquidity Facility for any Class of Certificates may have a
stated expiration date earlier than 15 days after the Final Legal
Distribution Date of such Class of Certificates so long as such Replacement
Liquidity Facility provides for a Non-Extension Drawing as contemplated by
Section 3.6(d) hereof.
"Replacement Liquidity Provider" means a Person (or Persons)
who issues a Replacement Liquidity Facility.
"Required Amount" means, with respect to each Liquidity
Facility, or the Cash Collateral Account, for any Class, for any day, the
sum of the aggregate amount of interest, calculated at the rate per annum
equal to the Stated Interest Rate for the related Class of Certificates,
that would be payable on such Class of Certificates on each of the three
successive Regular Distribution Dates immediately following such day or, if
such day is a Regular Distribution Date, on such day and the succeeding two
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of such Class of Certificates on such date and without regard
to expected future payments of principal on such Class of Certificates.
"Responsible Officer" means (i) with respect to the
Subordination Agent and each of the Trustees, any officer in the corporate
trust administration department of the Subordination Agent or such Trustee
or any other officer customarily performing functions similar to those
performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of
his knowledge of and familiarity with a particular subject, and (ii) with
respect to each Liquidity Provider, any authorized officer of such
Liquidity Provider.
"Scheduled Payment" means, with respect to any Equipment
Note, (i) any payment of principal or interest on such Equipment Note
(other than an Overdue Scheduled Payment) due from the obligor thereon or
(ii) any payment of interest on the corresponding Class of Certificates
with funds drawn under any Liquidity Facility, which payment represents the
installment of principal at the stated maturity of such installment of
principal on such Equipment Note, the payment of regularly scheduled
interest accrued on the unpaid principal amount of such Equipment Note, or
both; provided that any payment of principal of, premium, if any, or
interest resulting from the redemption or purchase of any Equipment Note
shall not constitute a Scheduled Payment.
"Scheduled Payment Date" means, with respect to any
Scheduled Payment, the date on which such Scheduled Payment is scheduled to
be made.
"Section 2.4(b) Fraction" has the meaning assigned to such
term in Section 2.4(b).
"Series A Equipment Notes" means the 8.36% Series A
Equipment Notes issued pursuant to any Indenture by the related Owner
Trustee or US Airways, as the case may be, and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Series B Equipment Notes" means the 9.01% Series B
Equipment Notes issued pursuant to any Indenture by the related Owner
Trustee or US Airways, as the case may be, and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Series C Equipment Notes" means the 7.96% Series C
Equipment Notes issued pursuant to any Indenture by the related Owner
Trustee or US Airways, as the case may be, and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Special Distribution Date" means, with respect to any
Special Payment, the date chosen by the Subordination Agent pursuant to
Section 2.4(a) for the distribution of such Special Payment in accordance
with this Agreement.
"Special Payment" means any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note, Trust
Indenture Estate or Collateral (as defined, where applicable, in each
Indenture).
"Special Payments Account" means the Eligible Deposit
Account created pursuant to Section 2.2 as a sub-account to the Collection
Account.
"Standard & Poor's" means Standard & Poor's Ratings
Services, a division of The XxXxxx-Xxxx Companies, Inc.
"State Street" has the meaning assigned to such terms in the
preliminary statements to this Agreement.
"Stated Amount" with respect to any Liquidity Facility,
means the Maximum Commitment (as defined in such Liquidity Facility) of the
applicable Liquidity Provider thereunder.
"Stated Expiration Date" has the meaning specified in
Section 3.6(d).
"Stated Interest Rate" means (i) with respect to the Class A
Certificates, 8.36% per annum, (ii) with respect to the Class B
Certificates, 9.01% per annum and (iii) with respect to the Class C
Certificates, 7.96% per annum.
"Subordination Agent" has the meaning assigned to it in the
preliminary statements to this Agreement.
"Subordination Agent Incumbency Certificate" has the meaning
assigned to such term in Section 2.5(a).
"Subordination Agent Representatives" has the meaning
assigned to such term in Section 2.5(a).
"Substitute Aircraft" shall have the meaning set forth in
the Note Purchase Agreement.
"Tax" and "Taxes" mean any and all taxes, fees, levies,
duties, tariffs, imposts, and other charges of any kind (together with any
and all interest, penalties, loss, damage, liability, expense, additions to
tax and additional amounts or costs incurred or imposed with respect
thereto) imposed or otherwise assessed by the United States of America or
by any state, local or foreign government (or any subdivision or agency
thereof) or other taxing authority, including, without limitation: taxes or
other charges on or with respect to income, franchises, windfall or other
profits, gross receipts, property, sales, use, capital stock, payroll,
employment, social security, workers' compensation, unemployment
compensation, or net worth and similar charges; taxes or other charges in
the nature of excise, withholding, ad valorem, stamp, transfer, value
added, taxes on goods and services, gains taxes, license, registration and
documentation fees, customs duties, tariffs, and similar charges.
"Termination Notice" with respect to any Liquidity Facility
has the meaning assigned to such term in such Liquidity Facility.
"Threshold Rating" means the short-term unsecured debt
rating of P-1 by Moody's and A-1+ by Standard & Poor's, in the case of the
Class A Liquidity Provider and the Class B Liquidity Provider, and the
short-term unsecured debt rating of P-1 by Moody's and A-1 by Standard &
Poor's, in the case of the Class C Liquidity Provider.
"Treasury Regulations" means regulations, including proposed
or temporary regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
"Triggering Event" means (x) the occurrence of an Indenture
Default under all of the Indentures resulting in a PTC Event of Default
with respect to the most senior Class of Certificates then Outstanding, (y)
the Acceleration of all of the outstanding Equipment Notes (provided that,
with respect to the period prior to the Delivery Period Expiry Date, the
aggregate principal balance of such Equipment Notes is in excess of
$300,000,000) or (z) the occurrence of a US Airways Bankruptcy Event.
"Trust" means any of the Class A Trust, the Class B Trust or
the Class C Trust.
"Trust Accounts" has the meaning assigned to such term in
Section 2.2(a).
"Trust Agreement" means any of the Class A Trust Agreement,
the Class B Trust Agreement or the Class C Trust Agreement.
"Trust Property" with respect to any Trust, has the meaning
set forth in the Trust Agreement for such Trust.
"Trustee" means any of the Class A Trustee, the Class B
Trustee or the Class C Trustee.
"Trustee Incumbency Certificate" has the meaning assigned to
such term in Section 2.5(b).
"Trustee Representatives" has the meaning assigned to such
term in Section 2.5(b).
"Underwriters" means Credit Suisse First Boston Corporation,
Xxxxxxx, Xxxxx & Co., Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation,
Deutsche Bank Securities Inc. and Xxxxxxx Xxxxx Barney Inc.
"Underwriting Agreement" means the Underwriting Agreement
dated August 24, 1999 among the Underwriters and US Airways, relating to
the purchase of the Class A Certificates and the Class B Certificates by
the Underwriters, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"US Airways" means US Airways, Inc., a Delaware corporation,
and its successors and assigns.
"US Airways Bankruptcy Event" means the occurrence and
continuation of any of the following:
(a) US Airways shall consent to the appointment of or the
taking of possession by a receiver, trustee or liquidator of itself
or of a substantial part of its property, or US Airways shall admit
in writing its inability to pay its debts generally as they come
due, or does not pay its debts generally as they become due or
shall make a general assignment for the benefit of creditors, or US
Airways shall file a voluntary petition in bankruptcy or a
voluntary petition or an answer seeking reorganization, liquidation
or other relief in a case under any bankruptcy laws or other
insolvency laws (as in effect at such time) or an answer admitting
the material allegations of a petition filed against US Airways in
any such case, or US Airways shall seek relief by voluntary
petition, answer or consent, under the provisions of any other
bankruptcy or other similar law providing for the reorganization or
winding-up of corporations (as in effect at such time) or US
Airways shall seek an agreement, composition, extension or
adjustment with its creditors under such laws, or US Airways' board
of directors shall adopt a resolution authorizing corporate action
in furtherance of any of the foregoing; or
(b) an order, judgment or decree shall be entered by any
court of competent jurisdiction appointing, without the consent of
US Airways, a receiver, trustee or liquidator of US Airways or of
any substantial part of its property, or any substantial part of
the property of US Airways shall be sequestered, or granting any
other relief in respect of US Airways as a debtor under any
bankruptcy laws or other insolvency laws (as in effect at such
time), and any such order, judgment or decree of appointment or
sequestration shall remain in force undismissed, unstayed and
unvacated for a period of 60 days after the date of entry thereof;
or
(c) a petition against US Airways in a case under any
bankruptcy laws or other insolvency laws (as in effect at such
time) is filed and not withdrawn or dismissed within 60 days
thereafter, or if, under the provisions of any law providing for
reorganization or winding-up of corporations which may apply to US
Airways, any court of competent jurisdiction assumes jurisdiction,
custody or control of US Airways or of any substantial part of its
property and such jurisdiction, custody or control remains in force
unrelinquished, unstayed and unterminated for a period of 60 days.
"US Airways Provisions" has the meaning specified in Section
9.1(a).
"Written Notice" means, from the Subordination Agent, any
Trustee or Liquidity Provider, a written instrument executed by the
Designated Representative of such Person. An invoice delivered by a
Liquidity Provider pursuant to Section 3.1 in accordance with its normal
invoicing procedures shall constitute Written Notice under such Section.
ARTICLE II
TRUST ACCOUNTS; CONTROLLING PARTY
SECTION 2.1. Agreement to Terms of Subordination; Payments
from Monies Received Only. (a) Each Trustee hereby acknowledges and agrees
to the terms of subordination and distribution set forth in this Agreement
in respect of each Class of Certificates and agrees to enforce such
provisions and cause all payments in respect of the Equipment Notes and the
Liquidity Facilities to be applied in accordance with the terms of this
Agreement. In addition, each Trustee hereby agrees to cause the Equipment
Notes purchased by the related Trust to be registered in the name of the
Subordination Agent or its nominee, as agent and trustee for such Trustee,
to be held in trust by the Subordination Agent solely for the purpose of
facilitating the enforcement of the subordination and other provisions of
this Agreement.
(b) Except as otherwise expressly provided in the next
succeeding sentence of this Section 2.1, all payments to be made by the
Subordination Agent hereunder shall be made only from amounts received by
it that constitute Scheduled Payments, Special Payments, payments under
Section 6(b) of the Participation Agreements with respect to Owned
Aircraft, or payments under Section 6(c) of the Participation Agreement
with respect to Leased Aircraft or payments under Section 7 of the Note
Purchase Agreement, and only to the extent that the Subordination Agent
shall have received sufficient income or proceeds therefrom to enable it to
make such payments in accordance with the terms hereof. Each of the
Trustees and the Subordination Agent hereby agrees and, as provided in each
Trust Agreement, each Certificateholder, by its acceptance of a
Certificate, and each Liquidity Provider, by entering into the Liquidity
Facility to which it is a party, has agreed to look solely to such amounts
to the extent available for distribution to it as provided in this
Agreement and to the relevant Deposits and that none of the Trustees, Owner
Trustees, Loan Trustees, Owner Participants nor the Subordination Agent is
personally liable to any of them for any amounts payable or any liability
under this Agreement, any Trust Agreement, any Liquidity Facility or such
Certificate, except (in the case of the Subordination Agent) as expressly
provided herein or (in the case of the Trustees) as expressly provided in
each Trust Agreement or (in the case of the Owner Trustees and the Loan
Trustees) as expressly provided in any Operative Agreement.
SECTION 2.2. Trust Accounts. (a) Upon the execution of this
Agreement, the Subordination Agent shall establish and maintain in its name
(i) the Collection Account as an Eligible Deposit Account, bearing a
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Trustees, the Certificateholders and the
Liquidity Providers, and (ii) as a sub-account in the Collection Account,
the Special Payments Account as an Eligible Deposit Account, bearing a
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Trustees, the Certificateholders and the
Liquidity Providers. The Subordination Agent shall establish and maintain
the Cash Collateral Accounts pursuant to and under the circumstances set
forth in Section 3.6(f) hereof. Upon such establishment and maintenance
under Section 3.6(f) hereof, the Cash Collateral Accounts shall, together
with the Collection Account, constitute the "Trust Accounts" hereunder.
(b) Funds on deposit in the Trust Accounts shall be invested
and reinvested by the Subordination Agent in Eligible Investments selected
by the Subordination Agent if such investments are reasonably available and
have maturities no later than the earlier of (i) 90 days following the date
of such investment and (ii) the Business Day immediately preceding the
Regular Distribution Date or the date of the related distribution pursuant
to Section 2.4 hereof, as the case may be, next following the date of such
investment; (or, in the case of any amount on deposit in the Cash
Collateral Account with respect to any Liquidity Facility (with respect to
such Liquidity Facility, the "Relevant Amount"), (A) in the case of a
portion of the Relevant Amount equal to the amount scheduled to be paid to
the Liquidity Provider with respect to such Liquidity Facility on the
Regular Distribution Date next following the date of such investment in
accordance with clause (iv), (v) or (vi) of Section 3.6(f), the Business
Day immediately preceding such Regular Distribution Date, or (B) in the
case of a portion of the Relevant Amount equal to the Relevant Amount minus
the amount described in clause (A) above, the Business Day immediately
preceding the scheduled Interest Payment Date with respect to such
Liquidity Facility next following the date of such investment); provided,
however, that following the making of a Downgrade Drawing or a
Non-Extension Drawing under any Liquidity Facility, the Subordination Agent
shall invest and reinvest such amounts in Eligible Investments at the
direction of the Liquidity Provider funding such Drawing; provided further,
however, that upon the occurrence and during the continuation of a
Triggering Event, the Subordination Agent shall invest and reinvest such
amounts in accordance with the written instructions of the Controlling
Party. Unless otherwise expressly provided in this Agreement (including,
without limitation, with respect to Investment Earnings on amounts on
deposit in the Cash Collateral Accounts, Section 3.6(f) hereof), any
Investment Earnings shall be deposited in the Collection Account when
received by the Subordination Agent and shall be applied by the
Subordination Agent in the same manner as the other amounts on deposit in
the Collection Account are to be applied and any losses shall be charged
against the principal amount invested, in each case net of the
Subordination Agent's reasonable fees and expenses in making such
investments. The Subordination Agent shall not be liable for any loss
resulting from any investment, reinvestment or liquidation required to be
made under this Agreement other than by reason of its willful misconduct or
gross negligence. Eligible Investments and any other investment required to
be made hereunder shall be held to their maturities except that any such
investment may be sold (without regard to its maturity) by the
Subordination Agent without instructions whenever such sale is necessary to
make a distribution required under this Agreement. Uninvested funds held
hereunder shall not earn or accrue interest.
(c) The Subordination Agent shall possess all right, title
and interest in all funds on deposit from time to time in the Trust
Accounts and in all proceeds thereof (including all income thereon, except
as otherwise expressly provided herein with respect to Investment
Earnings). The Trust Accounts shall be held in trust by the Subordination
Agent under the sole dominion and control of the Subordination Agent for
the benefit of the Trustees, the Certificateholders and the Liquidity
Providers, as the case may be. If, at any time, any of the Trust Accounts
ceases to be an Eligible Deposit Account, the Subordination Agent shall
within 10 Business Days (or such longer period, not to exceed 30 calendar
days, to which each Rating Agency may consent) establish a new Collection
Account, Special Payments Account or Cash Collateral Account, as the case
may be, as an Eligible Deposit Account and shall transfer any cash and/or
any investments to such new Collection Account, Special Payments Account or
Cash Collateral Account, as the case may be. So long as State Street is an
Eligible Institution, the Trust Accounts shall be maintained with it as
Eligible Deposit Accounts.
SECTION 2.3. Deposits to the Collection Account and Special
Payments Account. (a) The Subordination Agent shall, upon receipt thereof,
deposit in the Collection Account all Scheduled Payments received by it.
(b) The Subordination Agent shall, on each date when one or
more Special Payments are made to the Subordination Agent as holder of the
Equipment Notes, deposit in the Special Payments Account the aggregate
amount of such Special Payments.
SECTION 2.4. Distributions of Special Payments. (a) Notice
of Special Payment. Except as provided in Section 2.4(e) below, upon
receipt by the Subordination Agent, as registered holder of the Equipment
Notes, of any notice of a Special Payment (or, in the absence of any such
notice, upon receipt by the Subordination Agent of a Special Payment), the
Subordination Agent shall promptly give notice thereof to each Trustee and
the Liquidity Providers. The Subordination Agent shall promptly calculate
the amount of the redemption or purchase of Equipment Notes or the amount
of any Overdue Scheduled Payment, as the case may be, comprising such
Special Payment under the applicable Indenture or Indentures and shall
promptly send to each Trustee a Written Notice of such amount and the
amount allocable to each Trust. Such Written Notice shall also set the
distribution date for such Special Payment (a "Special Distribution Date"),
which shall be the Business Day which immediately follows the later to
occur of (x) the 15th day after the date of such Written Notice or (y) the
date the Subordination Agent has received or expects to receive such
Special Payment. Amounts on deposit in the Special Payments Account shall
be distributed in accordance with Sections 2.4(b) and 2.4(c) hereof, as
applicable.
(b) Redemptions and Purchases of Equipment Notes. (i) So
long as no Triggering Event shall have occurred (whether or not
continuing), the Subordination Agent shall make distributions pursuant to
this Section 2.4(b) of amounts on deposit in the Special Payments Account
on account of the redemption, purchase (including, without limitation, a
purchase resulting from a sale of the Equipment Notes permitted by Article
IV hereof) or prepayment of all of the Equipment Notes issued pursuant to
an Indenture on the Special Distribution Date for such Special Payment in
the following order of priority:
first, such amount as shall be required to pay (A) all
accrued and unpaid Liquidity Expenses then in arrears plus
(B) the product of (x) the aggregate amount of all accrued
and unpaid Liquidity Expenses not in arrears to such Special
Distribution Date multiplied by (y) a fraction, the
numerator of which is the aggregate outstanding principal
amount of Equipment Notes being redeemed, purchased or
prepaid on such Special Distribution Date and the
denominator of which is the aggregate outstanding principal
amount of all Equipment Notes (the "Section 2.4(b)
Fraction"), shall be distributed to the Liquidity Providers
pro rata on the basis of the amount of Liquidity Expenses
owed to each Liquidity Provider;
second, such amount as shall be required to pay (A) all
accrued and unpaid interest (including interest accrued and
unpaid on any Interest Drawing or any Applied Provider
Advance (as defined in any Liquidity Facility)) then in
arrears on all Liquidity Obligations plus (B) the product of
(x) the aggregate amount of all accrued and unpaid interest
on all Liquidity Obligations not in arrears to such Special
Distribution Date (at the rate provided in the applicable
Liquidity Facility) multiplied by (y) the Section 2.4(b)
Fraction, shall be distributed to the Liquidity Providers
pro rata on the basis of the amount of such Liquidity
Obligations owed to each Liquidity Provider;
third, such amount as shall be required (A) if any Cash
Collateral Account had been previously funded as provided in
Section 3.6(f), to fund such Cash Collateral Account up to
its Required Amount shall be deposited in such Cash
Collateral Account, (B) if any Liquidity Facility shall
become a Downgraded Facility or a Non-Extended Facility at a
time when unreimbursed Interest Drawings under such
Liquidity Facility have reduced the Available Amount
thereunder to zero, to deposit into the related Cash
Collateral Account an amount equal to such Cash Collateral
Account's Required Amount shall be deposited in such Cash
Collateral Account, and (C) if, with respect to any
particular Liquidity Facility, neither subclause (A) nor
subclause (B) of this clause "third" are applicable, to pay
or reimburse the Liquidity Provider in respect of such
Liquidity Facility in an amount equal to the amount of any
unreimbursed Interest Drawings under such Liquidity Facility
shall be distributed to such Liquidity Provider, pro rata on
the basis of the amounts of all such deficiencies and/or
unreimbursed Interest Drawings in respect of each Liquidity
Provider;
fourth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to
either subclause (A) or (B) of clause "third" above, then
the Liquidity Provider with respect to such Liquidity
Facility shall be paid the excess of (x) the aggregate
outstanding amount of unreimbursed Advances (whether or not
then due) under such Liquidity Facility over (y) the
Required Amount for the relevant Class, pro rata on the
basis of such amounts in respect of each Liquidity Provider;
fifth, such amount as shall be required to pay in full
Expected Distributions to the holders of Class A
Certificates on such Special Distribution Date shall be
distributed to the Class A Trustee;
sixth, such amount as shall be required to pay in full
Expected Distributions to the holders of Class B
Certificates on such Special Distribution Date shall be
distributed to the Class B Trustee;
seventh, such amount as shall be required to pay in full
Expected Distributions to the holders of Class C
Certificates on such Special Distribution Date shall be
distributed to the Class C Trustee; and
eighth, the balance, if any, of such Special Payment shall
be transferred to the Collection Account for distribution in
accordance with Section 3.2 hereof.
For the purposes of this Section 2.4(b), clause (x) of the definition of
"Expected Distributions" shall be deemed to read as follows: "(x) accrued,
due and unpaid interest on such Certificates together with (without
duplication) accrued and unpaid interest on a portion of such Certificates
equal to the outstanding principal amount of the Equipment Notes held in
such Trust and being redeemed, purchased or prepaid (immediately prior to
such redemption, purchase or prepayment) in each case excluding interest,
if any, payable with respect to the Deposits related to such Trust".
(ii) Upon the occurrence of a Triggering Event (whether or
not continuing), the Subordination Agent shall make distributions pursuant
to this Section 2.4(b) of amounts on deposit in the Special Payments
Account on account of the redemption or purchase of all of the Equipment
Notes issued pursuant to an Indenture on the Special Distribution Date for
such Special Payment in accordance with Section 3.3 hereof.
(c) Other Special Payments. Except as provided in clause (e)
below, any amounts on deposit in the Special Payments Account other than in
respect of amounts to be distributed pursuant to Section 2.4(b) shall be
distributed on the Special Distribution Date therefor in accordance with
Article III hereof.
(d) Investment of Amounts in Special Payments Account. Any
amounts on deposit in the Special Payments Account prior to the
distribution thereof pursuant to Section 2.4(b) or (c) shall be invested in
accordance with Section 2.2(b). Investment Earnings on such investments
shall be distributed in accordance with Section 2.4(b) or (c), as the case
may be.
(e) Certain Payments. The Subordination Agent will
distribute promptly upon receipt thereof (i) any indemnity payment received
by it from the Owner Participant, the Owner Trustee or US Airways in
respect of any Trustee, any Liquidity Provider, any Paying Agent, any
Depositary or any Escrow Agent (collectively, the "Payees") and (ii) any
compensation (including, without limitation, any fees payable to any
Liquidity Provider under Section 2.03 of any Liquidity Facility) received
by it from the Owner Participant, the Owner Trustee or US Airways under any
Operative Agreement in respect of any Payee, directly to the Payee entitled
thereto.
SECTION 2.5. Designated Representatives. (a) With the
delivery of this Agreement, the Subordination Agent shall furnish to each
Liquidity Provider and each Trustee, and from time to time thereafter may
furnish to each Liquidity Provider and each Trustee, at the Subordination
Agent's discretion, or upon any Liquidity Provider's or Trustee's request
(which request shall not be made more than one time in any 12-month
period), a certificate (a "Subordination Agent Incumbency Certificate") of
a Responsible Officer of the Subordination Agent certifying as to the
incumbency and specimen signatures of the officers of the Subordination
Agent and the attorney-in-fact and agents of the Subordination Agent (the
"Subordination Agent Representatives") authorized to give Written Notices
on behalf of the Subordination Agent hereunder. Until each Liquidity
Provider and Trustee receives a subsequent Subordination Agent Incumbency
Certificate, it shall be entitled to rely on the last Subordination Agent
Incumbency Certificate delivered to it hereunder.
(b) With the delivery of this Agreement, each Trustee shall
furnish to the Subordination Agent, and from time to time thereafter may
furnish to the Subordination Agent, at such Trustee's discretion, or upon
the Subordination Agent's request (which request shall not be made more
than one time in any 12-month period), a certificate (a "Trustee Incumbency
Certificate") of a Responsible Officer of such Trustee certifying as to the
incumbency and specimen signatures of the officers of such Trustee and the
attorney-in-fact and agents of such Trustee (the "Trustee Representatives")
authorized to give Written Notices on behalf of such Trustee hereunder.
Until the Subordination Agent receives a subsequent Trustee Incumbency
Certificate, it shall be entitled to rely on the last Trustee Incumbency
Certificate delivered to it hereunder.
(c) With the delivery of this Agreement, each Liquidity
Provider shall furnish to the Subordination Agent, and from time to time
thereafter may furnish to the Subordination Agent, at such Liquidity
Provider's discretion, or upon the Subordination Agent's request (which
request shall not be made more than one time in any 12-month period), a
certificate (an "LP Incumbency Certificate") of any Responsible Officer of
such Liquidity Provider certifying as to the incumbency and specimen
signatures of any officer, attorney-in-fact, agent or other designated
representative of such Liquidity Provider (the "LP Representatives" and,
together with the Subordination Agent Representatives and the Trustee
Representatives, the "Designated Representatives") authorized to give
Written Notices on behalf of such Liquidity Provider hereunder. Until the
Subordination Agent receives a subsequent LP Incumbency Certificate, it
shall be entitled to rely on the last LP Incumbency Certificate delivered
to it hereunder.
SECTION 2.6. Controlling Party. (a) The Trustees and the
Liquidity Providers hereby agree that, with respect to any Indenture at any
given time, the Loan Trustee thereunder will be directed (i) in taking, or
refraining from taking, any action under such Indenture or with respect to
the Equipment Notes issued thereunder, so long as no Indenture Default has
occurred and is continuing thereunder, by the holders of at least a
majority of the outstanding principal amount of such Equipment Notes
(provided that, for so long as the Subordination Agent is the registered
holder of the Equipment Notes, the Subordination Agent shall act with
respect to this clause (i) in accordance with the directions of the
Trustees (in the case of each such Trustee, with respect to the Equipment
Notes issued under such Indenture and held as Trust Property of such Trust)
constituting, in the aggregate, directions with respect to such principal
amount of Equipment Notes), and (ii) after the occurrence and during the
continuance of an Indenture Default thereunder (which, in the case of an
Indenture pertaining to a Leased Aircraft, has not been cured by the
applicable Owner Trustee or the applicable Owner Participant, if
applicable, pursuant to Section 4.03 of such Indenture), in taking, or
refraining from taking, any action under such Indenture or with respect to
such Equipment Notes, including exercising remedies thereunder (including
Accelerating the Equipment Notes issued thereunder or foreclosing the Lien
on the Aircraft securing such Equipment Notes), by the Controlling Party.
(b) The Person who shall be the "Controlling Party shall be:
(w) the Class A Trustee; (x) upon payment of Final Distributions to the
holders of Class A Certificates, the Class B Trustee; (y) upon payment of
Final Distributions to the holders of Class B Certificates, the Class C
Trustee. For purposes of giving effect to the foregoing, the Trustees
(other than the Controlling Party) irrevocably agree (and the
Certificateholders (other than the Certificateholders represented by the
Controlling Party) shall be deemed to agree by virtue of their purchase of
Certificates) that the Subordination Agent, as record holder of the
Equipment Notes, shall exercise its voting rights in respect of the
Equipment Notes as directed by the Controlling Party and any vote so
exercised shall be binding upon the Trustees and all Certificateholders.
The Subordination Agent shall give written notice to all of
the other parties to this Agreement promptly upon a change in the identity
of the Controlling Party. Each of the parties hereto agrees that it shall
not exercise any of the rights of the Controlling Party at such time as it
is not the Controlling Party hereunder; provided, however, that nothing
herein contained shall prevent or prohibit any Non-Controlling Party from
exercising such rights as shall be specifically granted to such
Non-Controlling Party hereunder and under the other Operative Agreements.
(c) Notwithstanding the foregoing, at any time after 18
months from the earlier to occur of (i) the date on which the entire
Available Amount under any Liquidity Facility shall have been drawn (for
any reason other than a Downgrade Drawing or a Non-Extension Drawing) and
remain unreimbursed, (ii) the date on which the entire amount of any
Downgrade Drawing or Non-Extension Drawing shall have become and remain
"Applied Downgrade Advances" or "Applied Non-Extension Advances", as the
case may be, under and as defined in such Liquidity Facility and (iii) the
date on which all Equipment Notes shall have been Accelerated (provided
that with respect to the period prior to the Delivery Period Expiry Date,
such Equipment Notes have an aggregate outstanding principal balance in
excess of $300,000,000), the Liquidity Provider with the highest
outstanding amount of Liquidity Obligations owed to it shall have the right
to elect, by Written Notice to the Subordination Agent and each of the
Trustees, to become the Controlling Party hereunder with respect to any
Indenture at any time from and including the last day of such 18-month
period.
(d) The exercise of remedies by the Controlling Party under
this Agreement shall be expressly limited by Section 4.1(a)(ii) hereof.
(e) The Controlling Party shall not be entitled to require
or obligate any Non- Controlling Party to provide funds necessary to
exercise any right or remedy hereunder.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED
SECTION 3.1. Written Notice of Distribution. (a) No later
than 3:00 P.M. (New York City time) on the Business Day immediately
preceding each Regular Distribution Date (or Special Distribution Date for
purposes of Section 2.4(b) hereof, as the case may be), each of the
following Persons shall deliver to the Subordination Agent a Written Notice
setting forth the following information as at the close of business on such
Business Day:
(i) With respect to the Class A Certificates, the Class A
Trustee shall separately set forth the amounts to be paid in
accordance with clause "fifth" of Section 3.2 or 2.4(b), as the
case may be, hereof;
(ii) With respect to the Class B Certificates, the Class B
Trustee shall separately set forth the amounts to be paid in
accordance with clause "sixth" of Section 3.2 or 2.4(b), as the
case may be, hereof;
(iii) With respect to the Class C Certificates, the Class C
Trustee shall separately set forth the amounts to be paid in
accordance with clause "seventh" of Section 3.2 or 2.4(b), as the
case may be, hereof;
(iv) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be
paid in accordance with clauses "first", "second", "third" and
"fourth" of Section 3.2 or 2.4(b), as the case may be, hereof; and
(v) Each Trustee shall set forth the amounts to be paid in
accordance with clause "eighth" of Section 3.2 hereof.
The notices required under this Section 3.1(a) may be in the form of a
schedule or similar document provided to the Subordination Agent by the
parties referenced therein or by any one of them, which schedule or similar
document may state that, unless there has been a prepayment of the
Certificates, such schedule or similar document is to remain in effect
until any substitute notice or amendment shall be given to the
Subordination Agent by the party providing such notice.
(b) Following the occurrence of a Triggering Event, the
Subordination Agent shall request the following information from the
following Persons, and each of the following Persons shall, upon the request
of the Subordination Agent, deliver a Written Notice to the Subordination
Agent setting forth for such Person the following information:
(i) With respect to the Class A Certificates, the Class A
Trustee shall separately set forth the amounts to be paid in
accordance with clauses "first" (to reimburse payments made by the
Class A Certificateholders pursuant to subclause (iii) of clause
"first" of Section 3.3 hereof) and "seventh" of Section 3.3 hereof;
(ii) With respect to the Class B Certificates, the Class B
Trustee shall separately set forth the amounts to be paid in
accordance with clauses "first" (to reimburse payments made by the
Class B Certificateholders pursuant to subclause (iii) of clause
"first" of Section 3.3 hereof) and "eighth" of Section 3.3 hereof;
(iii) With respect to the Class C Certificates, the Class C
Trustee shall separately set forth the amounts to be paid in
accordance with clauses "first" (to reimburse payments made by the
Class C Certificateholders, pursuant to subclause (iii) of clause
"first" of Section 3.3 hereof) and clause "ninth" of Section 3.3
hereof ;
(iv) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be
paid to it in accordance with subclause (iii) of clause "first" of
Section 3.3 hereof and clauses "second", "third", "fourth" and
"fifth" of Section 3.3 hereof; and
(v) Each Trustee shall set forth the amounts to be paid in
accordance with clause "sixth" of Section 3.3 hereof.
(c) At such time as a Trustee or a Liquidity Provider shall
have received all amounts owing to it (and, in the case of a Trustee, the
Certificateholders for which it is acting) pursuant to Section 2.4, 3.2 or
3.3 hereof, as applicable, and, in the case of a Liquidity Provider, its
commitment under the related Liquidity Facility shall have terminated or
expired, such Person shall, by a Written Notice, so inform the
Subordination Agent and each other party to this Agreement.
(d) As provided in Section 6.5 hereof, the Subordination
Agent shall be fully protected in relying on any of the information set
forth in a Written Notice provided by any Trustee or any Liquidity Provider
pursuant to paragraphs (a) through (c) above and shall have no independent
obligation to verify, calculate or recalculate any amount set forth in any
Written Notice delivered in accordance with such paragraphs.
(e) Any Written Notice delivered by a Trustee or a Liquidity
Provider, as applicable, pursuant to Section 3.1(a), 3.1(b) or 3.1(c)
hereof, if made prior to 10:00 A.M. (New York City time) on any Business
Day shall be effective on the date delivered (or if delivered later on a
Business Day or if delivered on a day which is not a Business Day shall be
effective as of the next Business Day). Subject to the terms of this
Agreement, the Subordination Agent shall as promptly as practicable comply
with any such instructions; provided, however, that any transfer of funds
pursuant to any instruction received after 10:00 A.M. (New York City time)
on any Business Day may be made on the next succeeding Business Day.
(f) In the event the Subordination Agent shall not receive
from any Person any information set forth in paragraph (a) or (b) above
which is required to enable the Subordination Agent to make a distribution
to such Person pursuant to Section 3.2 or 3.3 hereof, the Subordination
Agent shall request such information and, failing to receive any such
information, the Subordination Agent shall not make such distribution(s) to
such Person. In such event, the Subordination Agent shall make
distributions pursuant to clauses "first" through "ninth" of Section 3.2
and clauses "first" through "ninth" of Section 3.3 to the extent it shall
have sufficient information to enable it to make such distributions, and
shall continue to hold any funds remaining, after making such
distributions, until the Subordination Agent shall receive all necessary
information to enable it to distribute any funds so withheld.
(g) On such dates (but not more frequently than monthly) as
any Liquidity Provider or any Trustee shall request, but in any event
automatically at the end of each calendar quarter, the Subordination Agent
shall send to such party a written statement reflecting all amounts on
deposit with the Subordination Agent pursuant to Section 3.1(f) hereof.
SECTION 3.2. Distribution of Amounts on Deposit in the
Collection Account. Except as otherwise provided in Sections 2.4, 3.1(f),
3.3, 3.4 and 3.6(b), amounts on deposit in the Collection Account (or, in
the case of any amount described in Section 2.4(c), on deposit in the
Special Payments Account) shall be promptly distributed on each Regular
Distribution Date (or, in the case of any amount described in Section
2.4(c), on the Special Distribution Date thereof) in the following order of
priority and in accordance with the information provided to the
Subordination Agent pursuant to Section 3.1(a) hereof:
first, such amount as shall be required to pay all accrued
and unpaid Liquidity Expenses owed to each Liquidity Provider shall
be distributed to the Liquidity Providers pro rata on the basis of
the amount of Liquidity Expenses owed to each Liquidity
Provider;
second, such amount as shall be required to pay in full the
aggregate amount of interest accrued on all Liquidity Obligations
(at the rate, or in the amount, provided in the applicable
Liquidity Facility) and unpaid shall be distributed to the
Liquidity Providers pro rata on the basis of the amount of such
Liquidity Obligations owed to each Liquidity Provider;
third, such amount as shall be required (A) if any Cash
Collateral Account had been previously funded as provided in
Section 3.6(f), to fund such Cash Collateral Account up to its
Required Amount shall be deposited in such Cash Collateral Account,
(B) if any Liquidity Facility shall become a Downgraded Facility or
a Non-Extended Facility at a time when unreimbursed Interest
Drawings under such Liquidity Facility have reduced the Available
Amount thereunder to zero, to deposit into the related Cash
Collateral Account an amount equal to such Cash Collateral
Account's Required Amount shall be deposited in such Cash
Collateral Account, and (C) if, with respect to any particular
Liquidity Facility, neither subclause (A) nor subclause (B) of this
clause "third" is applicable, to pay or reimburse the Liquidity
Provider in respect of such Liquidity Facility in an amount equal
to the amount of all Liquidity Obligations then due under such
Liquidity Facility (other than amounts payable pursuant to clause
"first" or "second" of this Section 3.2) shall be distributed to
such Liquidity Provider, pro rata on the basis of the amounts of
all such deficiencies and/or unreimbursed Liquidity Obligations in
respect of each Liquidity Provider;
fourth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to either
subclause (A) or (B) of clause "third" above, then the Liquidity
Provider with respect to such Liquidity Facility shall be paid the
excess of (x) the aggregate outstanding amount of unreimbursed
Advances (whether or not then due) under such Liquidity Facility
over (y) the Required Amount for the relevant Class, pro rata on
the basis of such amounts in respect of each Liquidity Provider;
fifth, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class A Certificates
on such Distribution Date shall be distributed to the Class A
Trustee;
sixth, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class B Certificates
on such Distribution Date shall be distributed to the Class B
Trustee;
seventh, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class C Certificates
on such Distribution Date shall be distributed to the Class C
Trustee;
eighth, such amount as shall be required to pay in full the
aggregate unpaid amount of fees and expenses payable as of such
Distribution Date to the Subordination Agent and each Trustee
pursuant to the terms of this Agreement and the Trust Agreements,
as the case may be, shall be distributed to the Subordination Agent
and such Trustee; and
ninth, the balance, if any, of any such amount remaining
thereafter shall be held in the Collection Account for later
distribution in accordance with this Article III.
SECTION 3.3. Distribution of Amounts on Deposit Following a
Triggering Event. (a) Except as otherwise provided in Sections 3.1(f) and
3.6(b) hereof, upon the occurrence of a Triggering Event and at all times
thereafter, all funds in the Collection Account or the Special Payments
Account shall be promptly distributed by the Subordination Agent in the
following order of priority:
first, such amount as shall be required to reimburse (i)
the Subordination Agent for any out-of-pocket costs and expenses
actually incurred by it (to the extent not previously reimbursed)
in the protection of, or the realization of the value of, the
Equipment Notes or any Trust Indenture Estate, shall be applied by
the Subordination Agent in reimbursement of such costs and
expenses, (ii) each Trustee for any amounts of the nature described
in clause (i) above actually incurred by it under the applicable
Trust Agreement (to the extent not previously reimbursed), shall be
distributed to such Trustee, and (iii) any Liquidity Provider or
Certificateholder for payments, if any, made by it to the
Subordination Agent or any Trustee in respect of amounts described
in clause (i) above, shall be distributed to such Liquidity
Provider or to the applicable Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all
amounts described in clauses (i) through (iii) above;
second, such amount remaining as shall be required to pay
all accrued and unpaid Liquidity Expenses shall be distributed to
each Liquidity Provider pro rata on the basis of the amount of
Liquidity Expenses owed to each Liquidity Provider;
third, such amount remaining as shall be required to pay
accrued and unpaid interest on the Liquidity Obligations as
provided in the Liquidity Facilities shall be distributed to each
Liquidity Provider pro rata on the basis of the amount of such
accrued and unpaid interest owed to each Liquidity Provider;
fourth, such amount remaining as shall be required (A) if
any Cash Collateral Account had been previously funded as provided
in Section 3.6(f), unless (i) a Performing Note Deficiency exists
and a Liquidity Event of Default shall have occurred and be
continuing with respect to the relevant Liquidity Facility or (ii)
a Final Drawing shall have occurred with respect to such Liquidity
Facility, to fund such Cash Collateral Account up to its Required
Amount (less the amount of any repayments of Interest Drawings
under such Liquidity Facility while subclause (A)(i) above is
applicable) shall be deposited in such Cash Collateral Account, (B)
if any Liquidity Facility shall become a Downgraded Facility or a
Non-Extended Facility at a time when unreimbursed Interest Drawings
under such Liquidity Facility have reduced the Available Amount
thereunder to zero, unless (i) a Performing Note Deficiency exists
and a Liquidity Event of Default shall have occurred and be
continuing with respect to the relevant Liquidity Facility or (ii)
a Final Drawing shall have occurred with respect to such Liquidity
Facility, to deposit into the related Cash Collateral Account an
amount equal to such Cash Collateral Account's Required Amount
(less the amount of any repayments of Interest Drawings under such
Liquidity Facility while subclause (B)(i) above is applicable)
shall be deposited in such Cash Collateral Account, and (C) if,
with respect to any particular Liquidity Facility, neither
subclause (A) nor subclause (B) of this clause "fourth" are
applicable, to pay in full the outstanding amount of all Liquidity
Obligations then due under such Liquidity Facility (other than
amounts payable pursuant to clause "second" or "third" of this
Section 3.3) shall be distributed to such Liquidity Provider, pro
rata on the basis of the amounts of all such deficiencies and/or
unreimbursed Liquidity Obligations in respect of each Liquidity
Provider;
fifth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to either
subclause (A) or (B) of clause "fourth" above, then the Liquidity
Provider with respect to such Liquidity Facility shall be paid the
excess of (x) the aggregate outstanding amount of unreimbursed
Advances (whether or not then due) under such Liquidity Facility
over (y) the Required Amount for the relevant Class (less the
amount of any repayments of Interest Drawings under such Liquidity
Facility while subclause (A)(i) or (B)(i), as the case may be, of
clause "fourth" above is applicable), pro rata on the basis of such
amounts in respect of each Liquidity Provider;
sixth, such amount as shall be required to reimburse or pay
(i) the Subordination Agent for any Tax (other than Taxes imposed
on compensation paid hereunder), expense, fee, charge or other loss
incurred by or any other amount payable to the Subordination Agent
in connection with the transactions contemplated hereby (to the
extent not previously reimbursed), shall be applied by the
Subordination Agent in reimbursement of such amount, (ii) each
Trustee for any Tax (other than Taxes imposed on compensation paid
under the applicable Trust Agreement), expense, fee, charge, loss
or any other amount payable to such Trustee under the applicable
Trust Agreements (to the extent not previously reimbursed), shall
be distributed to such Trustee, and (iii) each Certificateholder
for payments, if any, made by it pursuant to Section 5.2 hereof in
respect of amounts described in clause (i) above, shall be
distributed to the applicable Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all
amounts described in clauses (i) through (iii) above;
seventh, such amount remaining as shall be required to pay
in full Adjusted Expected Distributions on the Class A Certificates
shall be distributed to the Class A Trustee;
eighth, such amount remaining as shall be required to pay
in full Adjusted Expected Distributions on the Class B Certificates
shall be distributed to the Class B Trustee; and
ninth, such amount remaining as shall be required to pay in
full Adjusted Expected Distributions on the Class C Certificates
shall be distributed to the Class C Trustee.
SECTION 3.4. Other Payments. (a) Any payments received by
the Subordination Agent for which no provision as to the application
thereof is made in this Agreement shall be distributed by the Subordination
Agent (i) in the order of priority specified in Section 3.3 hereof and (ii)
to the extent received or realized at any time after the Final
Distributions for each Class of Certificates have been made, in the manner
provided in clause "first" of Section 3.3 hereof.
(b) On any Interest Payment Date under each Liquidity
Facility which is not a Distribution Date, the Subordination Agent shall
pay to the Liquidity Provider under such Liquidity Facility from, and to
the extent of, amounts on deposit in the Collection Account, an amount
equal to the amount of interest then due and payable to such Liquidity
Provider under such Liquidity Facility.
(c) Except as otherwise provided in Section 3.3 hereof, if
the Subordination Agent receives any Scheduled Payment after the Scheduled
Payment Date relating thereto, but prior to such payment becoming an
Overdue Scheduled Payment, then the Subordination Agent shall deposit such
Scheduled Payment in the Collection Account and promptly distribute such
Scheduled Payment in accordance with the priority of distributions set
forth in Section 3.2 hereof; provided that, for the purposes of this
Section 3.4(c) only, each reference in clause "eighth" of Section 3.2 to
"Distribution Date" shall be deemed to mean the actual date of payment of
such Scheduled Payment and each reference in clause "fifth", "sixth" or
"seventh" of Section 3.2 to "Distribution Date" shall be deemed to refer to
such Scheduled Payment Date.
SECTION 3.5. Payments to the Trustees and the Liquidity
Providers. Any amounts distributed hereunder to any Liquidity Provider
shall be paid to such Liquidity Provider by wire transfer of funds to the
address such Liquidity Provider shall provide to the Subordination Agent.
The Subordination Agent shall provide a Written Notice of any such transfer
to the applicable Liquidity Provider, as the case may be, at the time of
such transfer. Any amounts distributed hereunder by the Subordination Agent
to any Trustee which shall not be the same institution as the Subordination
Agent shall be paid to such Trustee by wire transfer funds at the address
such Trustee shall provide to the Subordination Agent.
SECTION 3.6. Liquidity Facilities. (a) Interest Drawings. If
on any Distribution Date, after giving effect to the subordination
provisions of this Agreement, the Subordination Agent shall not have
sufficient funds for the payment of any amounts due and owing in respect of
accrued interest on the Class A Certificates, the Class B Certificates or
the Class C Certificates (at the Stated Interest Rate for such Class of
Certificates), then, prior to 1:00 p.m.(New York City time) on such
Distribution Date, the Subordination Agent shall request a drawing (each
such drawing, an "Interest Drawing") under the Liquidity Facility with
respect to such Class of Certificates in an amount equal to the lesser of
(i) an amount sufficient to pay the amount of such accrued interest (at the
Stated Interest Rate for such Class of Certificates) and (ii) the Available
Amount under such Liquidity Facility, and shall pay such amount to the
Trustee with respect to such Class of Certificates in payment of such
accrued interest.
(b) Application of Interest Drawings. Notwithstanding
anything to the contrary contained in this Agreement, (i) all payments
received by the Subordination Agent in respect of an Interest Drawing under
the Class A Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class A Cash Collateral Account, and payable
in each case to the Class A Trustee on behalf of the Class A
Certificateholders, shall be promptly distributed to the Class A Trustee,
(ii) all payments received by the Subordination Agent in respect of an
Interest Drawing under the Class B Liquidity Facility and all amounts
withdrawn by the Subordination Agent from the Class B Cash Collateral
Account, and payable in each case to the Class B Trustee on behalf of the
Class B Certificateholders, shall be promptly distributed to the Class B
Trustee and (iii) all payments received by the Subordination Agent in
respect of an Interest Drawing under the Class C Liquidity Facility and all
amounts withdrawn by the Subordination Agent from the Class C Cash
Collateral Account, and payable in each case to the Class C Trustee on
behalf of the Class C Certificateholders, shall be promptly distributed to
the Class C Trustee.
(c) Downgrade Drawings. If at any time the short-term
unsecured debt rating of any Liquidity Provider issued by either Rating
Agency is lower than the applicable Threshold Rating, within 10 days after
receiving notice of such downgrading (but not later than the expiration
date of the Liquidity Facility issued by the downgraded Liquidity Provider
(the "Downgraded Facility")), such Liquidity Provider or US Airways may
arrange for a Replacement Liquidity Provider to issue and deliver a
Replacement Liquidity Facility to the Subordination Agent. If a Downgraded
Facility has not been replaced in accordance with the terms of this
paragraph, the Subordination Agent shall, on such 10th day (or if such 10th
day is not a Business Day, on the next succeeding Business Day) (or, if
earlier, the expiration date of such Downgraded Facility), request a
drawing in accordance with and to the extent permitted by such Downgraded
Facility (such drawing, a "Downgrade Drawing") of all available and undrawn
amounts thereunder. Amounts drawn pursuant to a Downgrade Drawing shall be
maintained and invested as provided in Section 3.6(f) hereof. The
applicable Liquidity Provider may also arrange for a Replacement Liquidity
Provider to issue and deliver a Replacement Liquidity Facility at any time
after such Downgrade Drawing so long as such Downgrade Drawing has not been
reimbursed in full to such Liquidity Provider.
(d) Non-Extension Drawings. If any Liquidity Facility with
respect to any Class of Certificates is scheduled to expire on a date (the
"Stated Expiration Date") prior to the date that is 15 days after the Final
Legal Distribution Date for such Class of Certificates, then, no earlier
than the 60th day and no later than the 40th day prior to the then Stated
Expiration Date, the Subordination Agent shall request that such Liquidity
Provider extend the Stated Expiration Date until the earlier of (i) the
date which is 15 days after such Final Legal Distribution Date and (ii) the
date that is the day immediately preceding the 364th day occurring after
the Stated Expiration Date (unless the obligations of such Liquidity
Provider thereunder are earlier terminated in accordance with such
Liquidity Facility). The Liquidity Provider may advise the Borrower, no
earlier than 40 days and no later than 25 days prior to such Stated
Expiration Date, that it agrees to so extend the Stated Expiration Date,
but, in any event, without the necessity of any action on the part of the
Liquidity Provider, such Stated Expiration Date shall automatically be so
extended, unless the Liquidity Provider advises the Subordination Agent on
or before the 25th day prior to such Stated Expiration Date that such
Stated Expiration Date shall not be so extended in which event and (if such
Liquidity Facility shall not have been replaced in accordance with Section
3.6(e)), the Subordination Agent shall, on such 25th day (or as soon as
possible thereafter), in accordance with the terms of the expiring
Liquidity Facility (a "Non- Extended Facility"), request a drawing under
such expiring Liquidity Facility (such drawing, a "Non-Extension Drawing")
of all available and undrawn amounts thereunder. Amounts drawn pursuant to
a Non-Extension Drawing shall be maintained and invested in accordance with
Section 3.6(f) hereof.
(e) Issuance of Replacement Liquidity Facility. (i) At any
time, US Airways may, at its option, with cause or without cause, arrange
for a Replacement Liquidity Facility to replace any Liquidity Facility for
any Class of Certificates (including any Replacement Liquidity Facility
provided pursuant to Section 3.6(e)(ii) hereof); provided, however, that if
the initial Liquidity Provider is replaced for one or more Liquidity
Facilities it must be replaced for all remaining Liquidity Facilities and
the initial Liquidity Provider for any Liquidity Facility shall not be
replaced by US Airways as a Liquidity Provider with respect to such
Liquidity Facility prior to the fifth anniversary of the Closing Date
unless (A) there shall have become due to such initial Liquidity Provider,
or such initial Liquidity Provider shall have demanded, amounts pursuant to
Section 3.01, 3.02 or 3.03 of any applicable Liquidity Facility and the
replacement of such initial Liquidity Provider would reduce or eliminate
the obligation to pay such amounts or US Airways determines in good faith
that there is a substantial likelihood that such initial Liquidity Provider
will have the right to claim any such amounts (unless such initial
Liquidity Provider waives, in writing, any right it may have to claim such
amounts), which determination shall be set forth in a certificate delivered
by US Airways to such initial Liquidity Provider setting forth the basis
for such determination and accompanied by an opinion of outside counsel
selected by US Airways and reasonably acceptable to such initial Liquidity
Provider verifying the legal conclusions, if any, of such certificate
relating to such basis, provided that, in the case of any likely claim for
such amounts based upon any proposed, or proposed change in, law, rule,
regulation, interpretation, directive, requirement, request or
administrative practice, such opinion may assume the adoption or
promulgation of such proposed matter, (B) it shall become unlawful or
impossible for such initial Liquidity Provider (or its Facility Office) to
maintain or fund its LIBOR Advances as described in Section 3.10 of any
Liquidity Facility, (C) the short-term unsecured debt rating of such
initial Liquidity Provider is downgraded by Standard & Poor's from A-1+ to
A-1 and there is a resulting downgrade in the rating by any Rating Agency
of any Class of Certificates, (D) any Liquidity Facility of such initial
Liquidity Provider shall become a Downgraded Facility or a Non-Extended
Facility or a Downgrade Drawing or a Non-Extension Drawing shall have
occurred under any Liquidity Facility of such initial Liquidity Provider or
(E) such initial Liquidity Provider shall have breached any of its payment
(including, without limitation, funding) obligations under any Liquidity
Facility in respect of which it is the Liquidity Provider. If such
Replacement Liquidity Facility is provided at any time after a Downgrade
Drawing or Non-Extension Drawing has been made, all funds on deposit in the
relevant Cash Collateral Account will be returned to the Liquidity Provider
being replaced.
(ii) If any Liquidity Provider shall determine not to
extend any of its Liquidity Facilities in accordance with Section
3.6(d), then such Liquidity Provider may, at its option, arrange
for a Replacement Liquidity Facility to replace such Liquidity
Facility during the period no earlier than 40 days and no later
than 25 days prior to the then effective Stated Expiration Date of
such Liquidity Facility.
(iii) No Replacement Liquidity Facility arranged by US
Airways or a Liquidity Provider in accordance with clause (i) or
(ii) above or pursuant to Section 3.6(c), respectively, shall
become effective and no such Replacement Liquidity Facility shall
be deemed a "Liquidity Facility" under the Operative Agreements (in
each case other than insofar as necessary to permit the repayment
of amounts owed to the replaced Liquidity Provider), unless and
until (A) each of the conditions referred to in this clause (iii)
and clause (iv) below shall have been satisfied, (B) if such
Replacement Liquidity Facility shall materially adversely affect
the rights, remedies, interests or obligations of the Class A
Certificateholders, the Class B Certificateholders or the Class C
Certificateholders under any of the Operative Agreements, the
applicable Trustee shall have consented, in writing, to the
execution and issuance of such Replacement Liquidity Facility and
(C) in the case of a Replacement Liquidity Facility arranged by a
Liquidity Provider under Section 3.6(e)(ii) or pursuant to Section
3.6(c), such Replacement Liquidity Facility is reasonably
acceptable to US Airways.
(iv) In connection with the issuance of each Replacement
Liquidity Facility, the Subordination Agent shall (x) prior to the
issuance of such Replacement Liquidity Facility, obtain written
confirmation from each Rating Agency that such Replacement
Liquidity Facility will not cause a reduction of any rating then in
effect for any Class of Certificates by such Rating Agency (without
regard to any downgrading of any rating of any Liquidity Provider
being replaced pursuant to Section 3.6(c) hereof or 3.6(e)(i),(ii)
or (iii) hereof), (y) pay all Liquidity Obligations then owing to
the replaced Liquidity Provider (which payment shall be made first
from available funds in the applicable Cash Collateral Account as
described in clause (vii) of Section 3.6(f) hereof, and thereafter
from any other available source, including, without limitation, a
drawing under the Replacement Liquidity Facility) and (z) cause the
issuer of the Replacement Liquidity Facility to deliver the
Replacement Liquidity Facility to the Subordination Agent, together
with a legal opinion opining that such Replacement Liquidity
Facility is an enforceable obligation of such Replacement Liquidity
Provider.
(v) Upon satisfaction of the conditions set forth in
clauses (iii) and (iv) of this Section 3.6(e) with respect to a
Replacement Liquidity Facility, (w) the replaced Liquidity Facility
shall terminate, (x) the Subordination Agent shall, if and to the
extent so requested by US Airways or the Liquidity Provider being
replaced, execute and deliver any certificate or other instrument
required in order to terminate the replaced Liquidity Facility,
shall surrender the replaced Liquidity Facility to the Liquidity
Provider being replaced and shall execute and deliver the
Replacement Liquidity Facility and any associated Fee Letter, (y)
each of the parties hereto shall enter into any amendments to this
Agreement necessary to give effect to (1) the replacement of the
applicable Liquidity Provider with the applicable Replacement
Liquidity Provider and (2) the replacement of the applicable
Liquidity Facility with the applicable Replacement Liquidity
Facility and (z) the applicable Replacement Liquidity Provider
shall be deemed to be a Liquidity Provider with the rights and
obligations of a Liquidity Provider hereunder and under the other
Operative Agreements and such Replacement Liquidity Facility shall
be deemed to be a Liquidity Facility hereunder and under the other
Operative Agreements.
(f) Cash Collateral Accounts; Withdrawals; Investments. In
the event the Subordination Agent shall draw all available amounts under
the Class A Liquidity Facility, the Class B Liquidity Facility or the Class
C Liquidity Facility pursuant to Section 3.6(c), 3.6(d) or 3.6(i) hereof,
or in the event amounts are to be deposited in a Cash Collateral Account
pursuant to subclause (B) of clause "third" of Section 2.4(b), subclause
(B) of clause "third" of Section 3.2 or subclause (B) of clause "fourth" of
Section 3.3, amounts so drawn or to be deposited, as the case may be, shall
be deposited by the Subordination Agent in the Class A Cash Collateral
Account, the Class B Cash Collateral Account or the Class C Collateral
Account, respectively. All amounts on deposit in each Cash Collateral
Account shall be invested and reinvested in Eligible Investments in
accordance with Section 2.2(b) hereof.
On each Interest Payment Date (or, in the case of any Special Distribution
Date occurring prior to the occurrence of a Triggering Event on such
Special Distribution Date), Investment Earnings on amounts on deposit in
each Cash Collateral Account (or, in the case of any Special Distribution
Date occurring prior to the occurrence of a Triggering Event, a fraction of
such Investment Earnings equal to the Section 2.4(b) Fraction) shall be
deposited in the Collection Account (or, in the case of any Special
Distribution Date occurring prior to the occurrence of a Triggering Event,
the Special Payments Account) and applied on such Interest Payment Date (or
Special Distribution Date, as the case may be) in accordance with Section
2.4, 3.2, 3.3 or 3.4 (as applicable). The Subordination Agent shall deliver
a written statement to US Airways and the Liquidity Provider one day prior
to each Interest Payment Date and Special Distribution Date setting forth
the aggregate amount of Investment Earnings held in the Cash Collateral
Accounts as of such date. In addition, from and after the date funds are so
deposited, the Subordination Agent shall make withdrawals from such account
as follows:
(i) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay
accrued and unpaid interest due and owing on the Class A
Certificates (at the Stated Interest Rate for the Class A
Certificates) from any other source, withdraw from the Class A Cash
Collateral Account, and pay to the Class A Trustee, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid
interest (at the Stated Interest Rate for the Class A Certificates)
on such Class A Certificates and (y) the amount on deposit in the
Class A Cash Collateral Account;
(ii) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay
accrued and unpaid interest due and owing on the Class B
Certificates (at the Stated Interest Rate for the Class B
Certificates) from any other source, withdraw from the Class B Cash
Collateral Account, and pay to the Class B Trustee, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid
interest (at the Stated Interest Rate for the Class B Certificates)
on such Class B Certificates and (y) the amount on deposit in the
Class B Cash Collateral Account;
(iii) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay
accrued and unpaid interest due and owing on the Class C
Certificates (at the Stated Interest Rate for the Class C
Certificates) from any other source, withdraw from the Class C Cash
Collateral Account, and pay to the Class C Trustee, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid
interest (at the Stated Interest Rate for the Class C Certificates)
on such Class C Certificates and (y) the amount on deposit in the
Class C Cash Collateral Account;
(iv) on each date on which the Pool Balance of the Class A
Trust shall have been reduced by payments made to the Class A
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement
for such Class, the Subordination Agent shall withdraw from the
Class A Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on
such date (including any such reduction resulting from a prior
withdrawal of amounts on deposit in the Class A Cash Collateral
Account on such date) and any transfer of Investment Earnings from
such Cash Collateral Account to the Collection Account or the
Special Payments Account on such date, an amount equal to the sum
of the Required Amount (with respect to the Class A Liquidity
Facility) plus Investment Earnings on deposit in such Cash
Collateral Account will be on deposit in the Class A Cash
Collateral Account and shall first, pay such withdrawn amount to
the Class A Liquidity Provider until the Liquidity Obligations
(with respect to the Class A Certificates) owing to such Liquidity
Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;
(v) on each date on which the Pool Balance of the Class B
Trust shall have been reduced by payments made to the Class B
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement
for such Class, the Subordination Agent shall withdraw from the
Class B Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on
such date (including any such reduction resulting from a prior
withdrawal of amounts on deposit in the Class B Cash Collateral
Account on such date) and any transfer of Investment Earnings from
such Cash Collateral Account to the Collection Account or the
Special Payments Account on such date, an amount equal to the sum
of the Required Amount (with respect to the Class B Liquidity
Facility) plus Investment Earnings on deposit in such Cash
Collateral Account will be on deposit in the Class B Cash
Collateral Account and shall first, pay such withdrawn amount to
the Class B Liquidity Provider until the Liquidity Obligations
(with respect to the Class B Certificates) owing to such Liquidity
Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;
(vi) on each date on which the Pool Balance of the Class C
Trust shall have been reduced by payments made to the Class C
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement
for such Class, the Subordination Agent shall withdraw from the
Class C Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on
such date (including any such reduction resulting from a prior
withdrawal of amounts on deposit in the Class C Cash Collateral
Account on such date) and any transfer of Investment Earnings from
such Cash Collateral Account to the Collection Account or the
Special Payments Account on such date, an amount equal to the sum
of the Required Amount (with respect to the Class C Liquidity
Facility) plus Investment Earnings on deposit in such Cash
Collateral Account will be on deposit in the Class C Cash
Collateral Account and shall first, pay such withdrawn amount to
the Class C Liquidity Provider until the Liquidity Obligations
(with respect to the Class C Certificates) owing to such Liquidity
Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;
(vii) if a Replacement Liquidity Facility for any Class of
Certificates shall be delivered to the Subordination Agent
following the date on which funds have been deposited into the Cash
Collateral Account for such Class of Certificates, the
Subordination Agent shall withdraw all amounts on deposit in such
Cash Collateral Account and shall pay such amounts to the replaced
Liquidity Provider until all Liquidity Obligations owed to such
Person shall have been paid in full, and shall deposit any
remaining amount in the Collection Account; and
(viii)following the payment of Final Distributions with
respect to any Class of Certificates, on the date on which the
Subordination Agent shall have been notified by the Liquidity
Provider for such Class of Certificates that the Liquidity
Obligations owed to such Liquidity Provider have been paid in full,
the Subordination Agent shall withdraw all amounts on deposit in
the Cash Collateral Account in respect of such Class of
Certificates and shall deposit such amount in the Collection
Account.
(g) Reinstatement. With respect to any Interest Drawing
under the Liquidity Facility for any Trust, upon the reimbursement of the
applicable Liquidity Provider for all or any part of the amount of such
Interest Drawing, together with any accrued interest thereon, the Available
Amount of such Liquidity Facility shall be reinstated by an amount equal to
the amount of such Interest Drawing so reimbursed to the applicable
Liquidity Provider but not to exceed the Stated Amount for such Liquidity
Facility; provided, however, that such Liquidity Facility shall not be so
reinstated in part or in full at any time if (x) both a Performing Note
Deficiency exists and a Liquidity Event of Default shall have occurred and
be continuing with respect to the relevant Liquidity Facility or (y) a
Final Drawing shall have occurred with respect to such Liquidity Facility.
In the event that, with respect to any particular Liquidity Facility (i)
funds are withdrawn from any Cash Collateral Account pursuant to clause
(i), (ii), (iii) or (iv) of Section 3.6(f) hereof or (ii) such Liquidity
Facility shall become a Downgraded Facility or a Non-Extended Facility at a
time when unreimbursed Interest Drawings under such Liquidity Facility have
reduced the Available Amount thereunder to zero, then funds received by the
Subordination Agent at any time other than (x) any time when a Liquidity
Event of Default shall have occurred and be continuing with respect to such
Liquidity Facility and a Performing Note Deficiency exists or (y) any time
after a Final Drawing shall have occurred with respect to such Liquidity
Facility shall be deposited in such Cash Collateral Account as and to the
extent provided in clause "third" of Section 2.4(b), clause "third" of
Section 3.2 or clause "fourth" of Section 3.3, as applicable, and applied
in accordance with Section 3.6(f) hereof.
(h) Reimbursement. The amount of each drawing under the
Liquidity Facilities shall be due and payable, together with interest
thereon, on the dates and at the rates, respectively, provided in the
Liquidity Facilities.
(i) Final Drawing. Upon receipt from a Liquidity Provider of
a Termination Notice with respect to any Liquidity Facility, the
Subordination Agent shall, not later than the date specified in such
Termination Notice, in accordance with the terms of such Liquidity
Facility, request a drawing under such Liquidity Facility of all available
and undrawn amounts thereunder (a "Final Drawing"). Amounts drawn pursuant
to a Final Drawing shall be maintained and invested in accordance with
Section 3.6(f) hereof.
(j) Reduction of Stated Amount. Promptly following each date
on which the Required Amount of the Liquidity Facility for a Class of
Certificates is reduced as a result of a reduction in the Pool Balance with
respect to such Certificates, the Subordination Agent shall, if any such
Liquidity Facility provides for reductions of the Stated Amount of such
Liquidity Facility and if such reductions are not automatic, request such
Liquidity Provider for such Class of Certificates to reduce such Stated
Amount to an amount equal to the Required Amount with respect to such
Liquidity Facility (as calculated by the Subordination Agent after giving
effect to such payment). Each such request shall be made in accordance with
the provisions of the applicable Liquidity Facility.
(k) Relation to Subordination Provisions. Interest Drawings
under the Liquidity Facilities and withdrawals from the Cash Collateral
Accounts, in each case, in respect of interest on the Certificates of any
Class, will be distributed to the Trustee for such Class of Certificates,
notwithstanding Sections 3.2, 3.3 and 3.6(h) hereof.
(l) Assignment of Liquidity Facility. The Subordination
Agent agrees not to consent to the assignment by any Liquidity Provider of
any of its rights or obligations under any Liquidity Facility or any
interest therein, unless (i) US Airways shall have consented to such
assignment and (ii) each Rating Agency shall have provided a Ratings
Confirmation in respect of such assignment.
ARTICLE IV
EXERCISE OF REMEDIES
SECTION 4.1. Directions from the Controlling Party. (a) (i)
Following the occurrence and during the continuation of an Indenture
Default under any Indenture, the Controlling Party shall direct the
Subordination Agent, which in turn shall direct the Loan Trustee under such
Indenture, in the exercise of remedies available to the holders of the
Equipment Notes issued pursuant to such Indenture, including, without
limitation, the ability to vote all such Equipment Notes in favor of
Accelerating such Equipment Notes in accordance with the provisions of such
Indenture. Subject to the Owner Trustees' and the Owner Participants'
rights, if any, set forth in the Indentures with respect to Leased Aircraft
to purchase the Equipment Notes and the provisions of the next paragraph,
if the Equipment Notes issued pursuant to any Indenture have been
Accelerated following an Indenture Default with respect thereto, the
Controlling Party may sell, assign, contract to sell or otherwise dispose
of and deliver all (but not less than all) of such Equipment Notes to any
Person at public or private sale, at any location at the option of the
Controlling Party, all upon such terms and conditions as it may reasonably
deem advisable in accordance with applicable law.
(ii) Subject to the Owner Trustees' and the Owner
Participants' rights, if any, set forth in the Indentures with
respect to Leased Aircraft to purchase the Equipment Notes, and
notwithstanding the foregoing, so long as any Certificates remain
Outstanding, during the period ending on the date which is nine
months after the earlier of (x) the Acceleration of the Equipment
Notes issued pursuant to any Indenture or (y) the occurrence of a
US Airways Bankruptcy Event, without the consent of each Trustee,
(A) no Aircraft subject to the Lien of such Indenture or such
Equipment Notes may be sold if the net proceeds from such sale
would be less than the Minimum Sale Price for such Aircraft or such
Equipment Notes, and (B) with respect to any Leased Aircraft, the
amount and payment dates of rentals payable by US Airways under the
Lease for such Aircraft may not be adjusted, if, as a result of
such adjustment, the discounted present value of all such rentals
would be less than 75% of the discounted present value of the
rentals payable by US Airways under such Lease before giving effect
to such adjustment, in each case, using the weighted average
interest rate of the Equipment Notes issued pursuant to such
Indenture as the discount rate.
(iii) At the request of the Controlling Party, the
Subordination Agent may from time to time during the continuance of
an Indenture Default (and before the occurrence of a Triggering
Event) commission LTV Appraisals with respect to the Aircraft
subject to such Indenture.
(iv) After a Triggering Event occurs and any Equipment Note
becomes a NonPerforming Equipment Note, the Subordination Agent
shall obtain Appraisals with respect to all of the Aircraft (the
"LTV Appraisals") as soon as practicable and additional LTV
Appraisals on or prior to each anniversary of the date of such
initial LTV Appraisals; provided that if the Controlling Party
reasonably objects to the appraised value of the Aircraft shown in
such LTV Appraisals, the Controlling Party shall have the right to
obtain or cause to be obtained substitute LTV Appraisals (including
any LTV Appraisals based upon physical inspection of the Aircraft).
(b) The Controlling Party shall take such actions as it may
reasonably deem most effectual to complete the sale or other disposition of
such Aircraft or Equipment Notes. In addition, in lieu of any sale,
assignment, contract to sell or other disposition, the Controlling Party
may maintain possession of such Equipment Notes and continue to apply
monies received in respect of such Equipment Notes in accordance with
Article III hereof. In addition, in lieu of such sale, assignment, contract
to sell or other disposition, or in lieu of such maintenance of possession,
the Controlling Party may, subject to the terms and conditions of the
related Indenture, instruct the Loan Trustee under such Indenture to
foreclose on the Lien on the related Aircraft.
SECTION 4.2. Remedies Cumulative. Each and every right,
power and remedy given to the Trustees, the Liquidity Providers, the
Controlling Party or the Subordination Agent specifically or otherwise in
this Agreement shall be cumulative and shall be in addition to every other
right, power and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute, and each and every right, power
and remedy whether specifically herein given or otherwise existing may,
subject always to the terms and conditions hereof, be exercised from time
to time and as often and in such order as may be deemed expedient by any
Trustee, any Liquidity Provider, the Controlling Party or the Subordination
Agent, as appropriate, and the exercise or the beginning of the exercise of
any power or remedy shall not be construed to be a waiver of the right to
exercise at the same time or thereafter any other right, power or remedy.
No delay or omission by any Trustee, any Liquidity Provider, the
Controlling Party or the Subordination Agent in the exercise of any right,
remedy or power or in the pursuit of any remedy shall impair any such
right, power or remedy or be construed to be a waiver of any default or to
be an acquiescence therein.
SECTION 4.3. Discontinuance of Proceedings. In case any
party to this Agreement (including the Controlling Party in such capacity)
shall have instituted any Proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, entry or otherwise, and such
Proceeding shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Person instituting such
Proceeding, then and in every such case each such party shall, subject to
any determination in such Proceeding, be restored to its former position
and rights hereunder, and all rights, remedies and powers of such party
shall continue as if no such Proceeding had been instituted.
SECTION 4.4. Right of Certificateholders to Receive Payments
Not to Be Impaired. Anything in this Agreement to the contrary
notwithstanding but subject to each Trust Agreement, the right of any
Certificateholder or any Liquidity Provider, respectively, to receive
payments hereunder (including without limitation pursuant to Section 2.4,
3.2 or 3.3 hereof) when due, or to institute suit for the enforcement of
any such payment on or after the applicable Distribution Date, shall not be
impaired or affected without the consent of such Certificateholder or such
Liquidity Provider, respectively.
SECTION 4.5. Undertaking for Costs. In any Proceeding for
the enforcement of any right or remedy under this Agreement or in any
Proceeding against any Controlling Party or the Subordination Agent for any
action taken or omitted by it as Controlling Party or Subordination Agent,
as the case may be, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. The provisions of this Section do not
apply to a suit instituted by the Subordination Agent, a Liquidity Provider
or a Trustee or a suit by Certificateholders holding more than 10% of the
original principal amount of any Class of Certificates.
ARTICLE V
DUTIES OF THE SUBORDINATION AGENT;
AGREEMENTS OF TRUSTEES, ETC.
SECTION 5.1. Notice of Indenture Default or Triggering
Event. (a) In the event the Subordination Agent shall have actual knowledge
of the occurrence of an Indenture Default or a Triggering Event, as
promptly as practicable, and in any event within 10 days after obtaining
knowledge thereof, the Subordination Agent shall transmit by mail or
courier to the Rating Agencies, the Liquidity Providers and the Trustees
notice of such Indenture Default or Triggering Event, unless such Indenture
Default or Triggering Event shall have been cured or waived. For all
purposes of this Agreement, in the absence of actual knowledge on the part
of a Responsible Officer, the Subordination Agent shall not be deemed to
have knowledge of any Indenture Default or Triggering Event unless notified
in writing by one or more Trustees, one or more Liquidity Providers or one
or more Certificateholders.
(b) Other Notices. The Subordination Agent will furnish to
each Liquidity Provider and Trustee, promptly upon receipt thereof,
duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and other instruments furnished to the
Subordination Agent as registered holder of the Equipment Notes or
otherwise in its capacity as Subordination Agent to the extent the same
shall not have been otherwise directly distributed to such Liquidity
Provider or Trustee, as applicable, pursuant to the express provision of
any other Operative Agreement.
SECTION 5.2. Indemnification. The Subordination Agent shall
not be required to take any action or refrain from taking any action under
Section 5.1 (other than the first sentence thereof) or Article IV hereof
unless the Subordination Agent shall have been indemnified (to the extent
and in the manner reasonably satisfactory to the Subordination Agent)
against any liability, cost or expense (including counsel fees and
expenses) which may be incurred in connection therewith. The Subordination
Agent shall not be under any obligation to take any action under this
Agreement and nothing contained in this Agreement shall require the
Subordination Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in
the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it. The
Subordination Agent shall not be required to take any action under Section
5.1 (other than the first sentence thereof) or Article IV hereof, nor shall
any other provision of this Agreement be deemed to impose a duty on the
Subordination Agent to take any action, if the Subordination Agent shall
have been advised by counsel that such action is contrary to the terms
hereof or is otherwise contrary to law.
SECTION 5.3. No Duties Except as Specified in Intercreditor
Agreement. The Subordination Agent shall not have any duty or obligation to
take or refrain from taking any action under, or in connection with, this
Agreement, except as expressly provided by the terms of this Agreement; and
no implied duties or obligations shall be read into this Agreement against
the Subordination Agent. The Subordination Agent agrees that it will, in
its individual capacity and at its own cost and expense (but without any
right of indemnity in respect of any such cost or expense under Section 7.1
hereof) promptly take such action as may be necessary to duly discharge all
Liens on any of the Trust Accounts or any monies deposited therein which
result from claims against it in its individual capacity not related to its
activities hereunder or any other Operative Agreement.
SECTION 5.4. Notice from the Liquidity Providers and
Trustees. If any Liquidity Provider or Trustee has notice of an Indenture
Default or a Triggering Event, such Person shall promptly give notice
thereof to all other Liquidity Providers and Trustees and to the
Subordination Agent, provided, however, that no such Person shall have any
liability hereunder as a result of its failure to deliver any such notice.
ARTICLE VI
THE SUBORDINATION AGENT
SECTION 6.1. Authorization; Acceptance of Trusts and Duties.
Each of the Class A Trustee, the Class B Trustee and the Class C Trustee
hereby designates and appoints the Subordination Agent as the agent and
trustee of such Trustee under the applicable Liquidity Facility and
authorizes the Subordination Agent to enter into the applicable Liquidity
Facility as agent and trustee for such Trustee. Each of the Liquidity
Providers and the Trustees hereby designates and appoints the Subordination
Agent as the Subordination Agent under this Agreement. State Street hereby
accepts the duties hereby created and applicable to it as the Subordination
Agent and agrees to perform the same but only upon the terms of this
Agreement and agrees to receive and disburse all monies received by it in
accordance with the terms hereof. The Subordination Agent shall not be
answerable or accountable under any circumstances, except (a) for its own
willful misconduct or gross negligence (or ordinary negligence in the
handling of funds), (b) as provided in Section 2.2 hereof and (c) for
liabilities that may result from the material inaccuracy of any
representation or warranty of the Subordination Agent made in its
individual capacity in any Operative Agreement. The Subordination Agent
shall not be liable for any error of judgment made in good faith by a
Responsible Officer of the Subordination Agent, unless it is proved that
the Subordination Agent was negligent in ascertaining the pertinent facts.
SECTION 6.2. Absence of Duties. The Subordination Agent
shall have no duty to see to any recording or filing of this Agreement or
any other document, or to see to the maintenance of any such recording or
filing.
SECTION 6.3. No Representations or Warranties as to
Documents. The Subordination Agent in its individual capacity does not make
nor shall be deemed to have made any representation or warranty as to the
validity, legality or enforceability of this Agreement or any other
Operative Agreement or as to the correctness of any statement contained in
any thereof, except for the representations and warranties of the
Subordination Agent, made in its individual capacity, under any Operative
Agreement to which it is a party. The Certificateholders, the Trustees and
the Liquidity Providers make no representation or warranty hereunder
whatsoever.
SECTION 6.4. No Segregation of Monies; No Interest. Any
monies paid to or retained by the Subordination Agent pursuant to any
provision hereof and not then required to be distributed to any Trustee or
any Liquidity Provider as provided in Articles II and III hereof or
deposited into one or more Trust Accounts need not be segregated in any
manner except to the extent required by such Articles II and III and by
law, and the Subordination Agent shall not (except as otherwise provided in
Section 2.2 hereof) be liable for any interest thereon; provided, however,
that any payments received or applied hereunder by the Subordination Agent
shall be accounted for by the Subordination Agent so that any portion
thereof paid or applied pursuant hereto shall be identifiable as to the
source thereof.
SECTION 6.5. Reliance; Agents; Advice of Counsel. The
Subordination Agent shall not incur liability to anyone in acting upon any
signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper believed by
it to be genuine and believed by it to be signed by the proper party or
parties. As to the Pool Balance of any Trust as of any date, the
Subordination Agent may for all purposes hereof rely on a certificate
signed by any Responsible Officer of the applicable Trustee, and such
certificate shall constitute full protection to the Subordination Agent for
any action taken or omitted to be taken by it in good faith in reliance
thereon. As to any fact or matter relating to the Liquidity Providers or
the Trustees the manner of ascertainment of which is not specifically
described herein, the Subordination Agent may for all purposes hereof rely
on a certificate, signed by any Responsible Officer of the applicable
Liquidity Provider or Trustee, as the case may be, as to such fact or
matter, and such certificate shall constitute full protection to the
Subordination Agent for any action taken or omitted to be taken by it in
good faith in reliance thereon. The Subordination Agent shall assume, and
shall be fully protected in assuming, that each of the Liquidity Providers
and each of the Trustees are authorized to enter into this Agreement and to
take all action to be taken by them pursuant to the provisions hereof, and
shall not inquire into the authorization of each of the Liquidity Providers
and each of the Trustees with respect thereto. In the administration of the
trusts hereunder, the Subordination Agent may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or
through agents or attorneys and may consult with counsel, accountants and
other skilled persons to be selected and retained by it, and the
Subordination Agent shall not be liable for the acts or omissions of any
agent appointed with due care or for anything done, suffered or omitted in
good faith by it in accordance with the advice or written opinion of any
such counsel, accountants or other skilled persons.
SECTION 6.6. Capacity in Which Acting. The Subordination
Agent acts hereunder solely as agent and trustee herein and not in its
individual capacity, except as otherwise expressly provided in the
Operative Agreements.
SECTION 6.7. Compensation. The Subordination Agent shall be
entitled to reasonable compensation, including expenses and disbursements,
for all services rendered hereunder and shall have a priority claim to the
extent set forth in Article III hereof on all monies collected hereunder
for the payment of such compensation, to the extent that such compensation
shall not be paid by others. The Subordination Agent agrees that it shall
have no right against any Trustee or Liquidity Provider for any fee as
compensation for its services as agent under this Agreement. The provisions
of this Section 6.7 shall survive the termination of this Agreement.
SECTION 6.8. May Become Certificateholder. The institution
acting as Subordination Agent hereunder may become a Certificateholder and
have all rights and benefits of a Certificateholder to the same extent as
if it were not the institution acting as the Subordination Agent.
SECTION 6.9. Subordination Agent Required; Eligibility.
There shall at all times be a Subordination Agent hereunder which shall be
a corporation organized and doing business under the laws of the United
States of America or of any State or the District of Columbia having a
combined capital and surplus of at least $100,000,000 (or the obligations
of which, whether now in existence or hereafter incurred, are fully and
unconditionally guaranteed by a corporation organized and doing business
under the laws of the United States of America, any State thereof or of the
District of Columbia and having a combined capital and surplus of at least
$100,000,000), if there is such an institution willing and able to perform
the duties of the Subordination Agent hereunder upon reasonable or
customary terms. Such corporation shall be a citizen of the United States
and shall be authorized under the laws of the United States or any State
thereof or of the District of Columbia to exercise corporate trust powers
and shall be subject to supervision or examination by federal, state or
District of Columbia authorities. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of any
of the aforesaid supervising or examining authorities, then, for the
purposes of this Section 6.9, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published.
In case at any time the Subordination Agent shall cease to
be eligible in accordance with the provisions of this Section, the
Subordination Agent shall resign immediately in the manner and with the
effect specified in Section 8.1.
SECTION 6.10. Money to Be Held in Trust. All Equipment
Notes, monies and other property deposited with or held by the
Subordination Agent pursuant to this Agreement shall be held in trust for
the benefit of the parties entitled to such Equipment Notes, monies and
other property. All such Equipment Notes, monies or other property shall be
held in the Trust Department of the institution acting as Subordination
Agent hereunder.
ARTICLE VII
INDEMNIFICATION OF SUBORDINATION AGENT
SECTION 7.1. Scope of Indemnification. The Subordination
Agent shall be indemnified hereunder to the extent and in the manner
described in Section 6(b) of the Participation Agreements with respect to
Owned Aircraft, Section (b) of the Participation Agreements with respect to
Leased Aircraft and Section 6 and Section 7 of the Note Purchase Agreement.
The indemnities contained in such Sections of such agreements shall survive
the termination of this Agreement.
ARTICLE VIII
SUCCESSOR SUBORDINATION AGENT
SECTION 8.1. Replacement of Subordination Agent; Appointment
of Successor. The Subordination Agent may resign at any time by so
notifying the Trustees and the Liquidity Providers. The Controlling Party
may remove the Subordination Agent for cause by so notifying the
Subordination Agent and may appoint a successor Subordination Agent. The
Controlling Party shall remove the Subordination Agent if:
(1) the Subordination Agent fails to comply with Section
6.9 hereof;
(2) the Subordination Agent is adjudged bankrupt or
insolvent;
(3) a receiver or other public officer takes charge of the
Subordination Agent or its property; or
(4) the Subordination Agent otherwise becomes incapable of
acting.
If the Subordination Agent resigns or is removed or if a
vacancy exists in the office of Subordination Agent for any reason (the
Subordination Agent in such event being referred to herein as the retiring
Subordination Agent), the Controlling Party shall promptly appoint a
successor Subordination Agent.
A successor Subordination Agent shall deliver (x) a written
acceptance of its appointment as Subordination Agent hereunder to the
retiring Subordination Agent and (y) a written assumption of its
obligations hereunder and under each Liquidity Facility to each party
hereto, upon which the resignation or removal of the retiring Subordination
Agent shall become effective, and the successor Subordination Agent shall
have all the rights, powers and duties of the Subordination Agent under
this Agreement. The successor Subordination Agent shall mail a notice of
its succession to the Liquidity Providers and the Trustees. The retiring
Subordination Agent shall promptly transfer its rights under each of the
Liquidity Facilities and all of the property held by it as Subordination
Agent to the successor Subordination Agent.
If a successor Subordination Agent does not take office
within 60 days after the retiring Subordination Agent resigns or is
removed, the retiring Subordination Agent or one or more of the Trustees
may petition any court of competent jurisdiction for the appointment of a
successor Subordination Agent.
If the Subordination Agent fails to comply with Section 6.9
hereof (to the extent applicable), one or more of the Trustees or one or
more of the Liquidity Providers may petition any court of competent
jurisdiction for the removal of the Subordination Agent and the
appointment of a successor Subordination Agent.
Notwithstanding the foregoing, no resignation or removal of
the Subordination Agent shall be effective unless and until a successor has
been appointed. No appointment of a successor Subordination Agent shall be
effective unless and until the Rating Agencies shall have
delivered a Ratings Confirmation.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS
SECTION 9.1. Amendments, Waivers, etc. (a) This Agreement
may not be supplemented, amended or modified without the consent of each
Trustee (acting, except in the case of any amendment pursuant to Section
3.6(e)(v)(y) hereof with respect to any Replacement Liquidity Facility or
any amendment contemplated by the last sentence of this Section 9.1(a),
with the consent of holders of Certificates of the related Class evidencing
interests in the related Trust aggregating not less than a majority in
interest in such Trust or as otherwise authorized pursuant to the relevant
Trust Agreement), the Subordination Agent and each Liquidity Provider;
provided, however, that this Agreement may be supplemented, amended or
modified without the consent of any Trustee if such supplement, amendment
or cures an ambiguity or inconsistency or does not materially adversely
affect such Trustee or the holders of the related Class of Certificates;
provided further, however, that, if such supplement, amendment or
modification (A) would (x) directly or indirectly modify or supersede, or
otherwise conflict with, Section 2.2(b), Section 3.6(e), Section
3.6(f)(other than the last sentence thereof), or the second sentence of
Section 10.6 or this Section 9.1 (collectively, the "US Airways
Provisions") or (y) otherwise adversely affect the interests of a potential
Replacement Liquidity Provider or of US Airways with respect to its ability
to replace any Liquidity Facility or with respect to its payment
obligations under any Operative Agreement or (B) is made pursuant to the
last sentence of this Section 9.1(a), then such supplement, amendment or
modification shall not be effective without the additional written consent
of US Airways. Notwithstanding the foregoing, without the consent of each
Certificateholder and each Liquidity Provider, no supplement, amendment or
modification of this Agreement may (i) reduce the percentage of the
interest in any Trust evidenced by the Certificates issued by such Trust
necessary to consent to modify or amend any provision of this Agreement or
to waive compliance therewith or (ii) except as provided in the last
sentence of this Section 9.1(a), modify Section 2.4, 3.2 or 3.3 hereof,
relating to the distribution of monies received by the Subordination Agent
hereunder from the Equipment Notes or pursuant to the Liquidity Facilities.
Nothing contained in this Section shall require the consent of a Trustee at
any time following the payment of Final Distributions with respect to the
related Class of Certificates. If the Replacement Liquidity Facility for
any Liquidity Facility in accordance with Section 3.6(e) hereof is to be
comprised of more than one instrument as contemplated by the definition of
the term "Replacement Liquidity Facility", then each of the parties hereto
agrees to amend this Agreement to incorporate appropriate mechanics for
multiple Liquidity Facilities for an individual Trust.
(b) In the event that the Subordination Agent, as the
registered holder of any Equipment Notes, receives a request for its
consent to any amendment, modification, consent or waiver under such
Equipment Notes, the Indenture pursuant to which such Equipment Notes were
issued, or the related Lease, Participation Agreement or other related
document, (i) if no Indenture Default shall have occurred and be continuing
with respect to such Indenture, the Subordination Agent shall request
directions with respect to each Series of such Equipment Notes from the
Trustee of the Trust which holds such Equipment Notes and shall vote or
consent in accordance with the directions of such Trustee and (ii) if any
Indenture Default (which, in the case of any Indenture pertaining to a
Leased Aircraft, has not been cured by the applicable Owner Trustee or the
applicable Owner Participant, if applicable, pursuant to Section 4.03 of
such Indenture) shall have occurred and be continuing with respect to such
Indenture, the Subordination Agent will exercise its voting rights as
directed by the Controlling Party, subject to Sections 4.1 and 4.4 hereof;
provided that no such amendment, modification or waiver shall, without the
consent of each Liquidity Provider, reduce the amount of rent, supplemental
rent or stipulated loss values payable by US Airways under any Lease or
reduce the amount of principal or interest payable by US Airways under any
Equipment Note issued under any Indenture in respect of an Owned Aircraft.
SECTION 9.2. Subordination Agent Protected. If, in the
reasonable opinion of the institution acting as the Subordination Agent
hereunder, any document required to be executed pursuant to the terms of
Section 9.1 affects any right, duty, immunity or indemnity with respect to
it under this Agreement or any Liquidity Facility, the Subordination Agent
may in its discretion decline to execute such document.
SECTION 9.3. Effect of Supplemental Agreements. Upon the
execution of any amendment, consent or supplement hereto pursuant to the
provisions hereof, this Agreement shall be and be deemed to be and shall be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this
Agreement of the parties hereto and beneficiaries hereof shall thereafter
be determined, exercised and enforced hereunder subject in all respects to
such modifications and amendments, and all the terms and conditions of any
such supplemental agreement shall be and be deemed to be and shall be part
of the terms and conditions of this Agreement for any and all purposes. In
executing or accepting any supplemental agreement permitted by this Article
IX, the Subordination Agent shall be entitled to receive, and shall be
fully protected in relying upon, an opinion of counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement.
SECTION 9.4. Notice to Rating Agencies. Promptly following
its receipt of each amendment, consent, modification, supplement or waiver
contemplated by this Article IX, the Subordination Agent shall send a copy
thereof to each Rating Agency.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Termination of Intercreditor Agreement.
Following payment of Final Distributions with respect to each Class of
Certificates and the payment in full of all Liquidity Obligations to the
Liquidity Providers and provided that there shall then be no other amounts
due to the Certificateholders, the Trustees, the Liquidity Providers and
the Subordination Agent hereunder or under the Trust Agreements, and that
the commitment of the Liquidity Providers under the Liquidity Facilities
shall have expired or been terminated, this Agreement and the trusts
created hereby shall terminate and this Agreement shall be of no further
force or effect. Except as aforesaid or otherwise provided, this Agreement
and the trusts created hereby shall continue in full force and effect in
accordance with the terms hereof.
SECTION 10.2. Intercreditor Agreement for Benefit of
Trustees, Liquidity Providers and Subordination Agent. Subject to the
second sentence of Section 10.6 and the provisions of Section 4.4, nothing
in this Agreement, whether express or implied, shall be construed to give
to any Person other than the Trustees, the Liquidity Providers and the
Subordination Agent any legal or equitable right, remedy or claim under or
in respect of this Agreement.
SECTION 10.3. Notices. Unless otherwise expressly specified
or permitted by the terms hereof, all notices, requests, demands,
authorizations, directions, consents, waivers or documents provided or
permitted by this Agreement to be made, given, furnished or filed shall be
in writing, mailed by certified mail, postage prepaid, or by confirmed
telecopy and
(i) if to the Subordination Agent, addressed to at its
office at:
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
000 Xxxxxx Xxxxxx
Xxxxxxx Xxxxxx
Xxxxxxxx , XX 00000
Attention: Corporate/Muni. Department
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
State Street Corp.
Corporate Trust Dept.
0 Xxxxxxxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
Fax: (000) 000-0000
(ii) if to any Trustee, addressed to it at its office at:
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION 000 Xxxxxx
Xxxxxx Xxxxxxx Xxxxxx Xxxxxxxx , XX 00000
Attention: Corporate/Muni. Trust Department
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
State Street Corp.
Corporate Trust Dept.
0 Xxxxxxxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
Fax: (000) 000-0000
(iii) if to the Liquidity Provider, addressed to it at its
office at:
AIG MATCHED FUNDING CORP.
000 Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to: the General Counsel at the same address
and fax number.
Whenever any notice in writing is required to be given by any Trustee or
Liquidity Provider or the Subordination Agent to any of the other of them,
such notice shall be deemed given and such requirement satisfied when such
notice is received. Any party hereto may change the address to which
notices to such party will be sent by giving notice of such change to the
other parties to this Agreement.
SECTION 10.4. Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 10.5. No Oral Modifications or Continuing Waivers.
No terms or provisions of this Agreement may be changed, waived, discharged
or terminated orally, but only by an instrument in writing signed by the
party or other Person against whom enforcement of the change, waiver,
discharge or termination is sought and any other party or other Person
whose consent is required pursuant to this Agreement and any waiver of the
terms hereof shall be effective only in the specific instance and for the
specific purpose given.
SECTION 10.6. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit
of, each of the parties hereto and the successors and assigns of each, all
as herein provided. In addition, the US Airways Provisions shall inure to
the benefit of US Airways and its successors and assigns, and (without
limitation of the foregoing) US Airways is hereby constituted, and agreed
to be, an express third party beneficiary of the US Airways Provisions.
SECTION 10.7. Headings. The headings of the various Articles
and Sections herein and in the table of contents hereto are for convenience
of reference only and shall not define or limit any of the terms or
provisions hereof.
SECTION 10.8. Counterpart Form. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when
so executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same agreement.
SECTION 10.9. Subordination. (a) As between the Liquidity
Providers, on the one hand, and the Trustees and the Certificateholders, on
the other hand, and as among the Trustees and the related
Certificateholders this Agreement shall be a subordination agreement for
purposes of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code, as amended
from time to time.
(b) Notwithstanding the provisions of this Agreement, if
prior to the payment in full to the Liquidity Providers of all Liquidity
Obligations then due and payable, any party hereto shall have received any
payment or distribution in respect of Equipment Notes or any other amount
under the Indentures or other Operative Agreements which, had the
subordination provisions of this Agreement been properly applied to such
payment, distribution or other amount, would not have been distributed to
such Person, then such payment, distribution or other amount shall be
received and held in trust by such Person and paid over or delivered to the
Subordination Agent for application as provided herein.
(c) If any Trustee, any Liquidity Provider or the
Subordination Agent receives any payment in respect of any obligations
owing hereunder (or, in the case of the Liquidity Providers, in respect of
the Liquidity Obligations), which is subsequently invalidated, declared
preferential, set aside and/or required to be repaid to a trustee, receiver
or other party, then, to the extent of such payment, such obligations (or,
in the case of the Liquidity Providers, such Liquidity Obligations)
intended to be satisfied shall be revived and continue in full force and
effect as if such payment had not been received.
(d) The Trustees (on behalf of themselves and the holders of
Certificates), the Liquidity Providers and the Subordination Agent confirm
that the payment priorities specified in Sections 2.4, 3.2 and 3.3 shall
apply in all circumstances, notwithstanding the fact that the obligations
owed to the Trustees and the holders of Certificates are secured by certain
assets and the Liquidity Obligations may not be so secured. The Trustees
expressly agree (on behalf of themselves and the holders of Certificates)
not to assert priority over the holders of Liquidity Obligations due to
their status as secured creditors in any bankruptcy, insolvency or other
legal proceeding.
(e) Each of the Trustees (on behalf of themselves and the
holders of Certificates), the Liquidity Providers and the Subordination
Agent may take any of the following actions without impairing its rights
under this Agreement:
(i) obtain a Lien on any property to secure any amounts
owing to it hereunder, including, in the case of the Liquidity
Providers, the Liquidity Obligations,
(ii) obtain the primary or secondary obligation of any
other obligor with respect to any amounts owing to it hereunder,
including, in the case of the Liquidity Providers, any of the
Liquidity Obligations,
(iii) renew, extend, increase, alter or exchange any
amounts owing to it hereunder, including, in the case of the
Liquidity Providers, any of the Liquidity Obligations, or release
or compromise any obligation of any obligor with respect thereto,
(iv) refrain from exercising any right or remedy, or delay
in exercising such right or remedy, which it may have, or
(v) take any other action which might discharge a
subordinated party or a surety under applicable law;
provided, however, that the taking of any such actions by any of the
Trustees, the Liquidity Providers or the Subordination Agent shall not
prejudice the rights or adversely affect the obligations of any other party
under this Agreement.
SECTION 10.10. Governing Law. THIS AGREEMENT SHALL IN ALL
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE.
SECTION 10.11. Submission to Jurisdiction; Waiver of Jury
Trial; Waiver of Immunity. (a) Each of the parties hereto hereby
irrevocably and unconditionally:
(i) submits for itself and its property in any legal action
or proceeding relating to this Agreement or any other Operative
Agreement, or for recognition and enforcement of any judgment in
respect hereof or thereof, to the nonexclusive general jurisdiction
of the courts of the State of New York, the courts of the United
States of America for the Southern District of New York, and the
appellate courts from any thereof;
(ii) consents that any such action or proceeding may be
brought in such courts, and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered
or certified mail (or any substantially similar form of mail),
postage prepaid, to each party hereto at its address set forth in
Section 10.3 hereof, or at such other address of which the other
parties shall have been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or
shall limit the right to xxx in any other jurisdiction.
(b) EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING
TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS BEING
ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. Each
of the parties warrants and represents that it has reviewed this waiver
with its legal counsel, and that it knowingly and voluntarily waives its
jury trial rights following consultation with such legal counsel. THIS
WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
(c) Each Liquidity Provider hereby waives any immunity it
may have from the jurisdiction of the courts of the United States of
America or of any State and waives any immunity any of its properties
located in the United States of America may have from attachment or
execution upon a judgment entered by any such court under the United States
Foreign Sovereign Immunities Act of 1976 or any similar successor
legislation.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, as of the day and year first
above written.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Trustee for each of the Trusts
By /s/ Xxxxx X. Xxxxxxx
_____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Assistant Vice-President
AIG MATCHED FUNDING CORP., as Class
A Liquidity Provider, Class B
Liquidity Provider and Class C
Liquidity Provider
By /s/ Xxxxx Xxxx
_____________________________________
Name: Xxxxx Xxxx
Title: Vice President
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its
individual capacity except as
expressly set forth herein but
solely as Subordination Agent
and trustee
By /s/ Xxxxx X. Xxxxxxx
_____________________________________
Name: Xxxxx X. Xxxxxxx
Title: Assistant Vice-President
