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Exhibit 4.25
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SECOND AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-10]
Dated as of November ___, 1996
between
WILMINGTON TRUST COMPANY,
not in its individual capacity
except as expressly provided herein
but solely as Owner Trustee
and
THE CHASE MANHATTAN BANK,
not in its individual capacity
except as expressly provided herein
but solely as Indenture Trustee
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Secured Equipment Notes Covering
One Airbus A320-231 Aircraft
Manufacturer's Serial Xx. 00
Xxxxxxxxxxxx Xx. X000XX
Leased by America West Airlines, Inc.
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TABLE OF CONTENTS
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GRANTING CLAUSE 3
HABENDUM CLAUSE 7
ARTICLE I
DEFINITIONS
SECTION 1.01. Special Definitions 9
ARTICLE II
THE EQUIPMENT NOTES
SECTION 2.01. Form of Equipment Notes 20
SECTION 2.02. Issuance and Terms of Equipment Notes 26
SECTION 2.03. Payments from Trust Indenture Estate
Only 29
SECTION 2.04. Method of Payment 31
SECTION 2.05. Application of Payments 33
SECTION 2.06. Termination of Interest in Trust
Indenture Estate 34
SECTION 2.07. Registration, Transfer and Exchange of
Equipment Notes 34
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen
Equipment Notes 36
SECTION 2.09. Payment of Expenses on Transfer;
Cancellation 36
SECTION 2.10. Mandatory Redemptions of Equipment
Notes 37
SECTION 2.11. Redemptions; Notice of Redemption. 37
SECTION 2.12. Option to Purchase Equipment Notes 38
SECTION 2.13. Subordination 39
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Certain Rent Distributions 40
SECTION 3.02. Event of Loss and Replacement 42
SECTION 3.03. Payment After Indenture Event of
Default, etc 43
SECTION 3.04. Certain Payments 46
SECTION 3.05. Other Payments 46
SECTION 3.06. Payments to Owner Trustee 47
SECTION 3.07. Investment of Amounts Held by
Indenture Trustee 47
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Trust Indenture
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ARTICLE IV
COVENANTS OF TRUST COMPANY AND OWNER
TRUSTEE; INDENTURE EVENTS OF DEFAULT;
REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of Trust Company and Owner
Trustee 48
SECTION 4.02. Indenture Events of Default 49
SECTION 4.03. Certain Rights 52
SECTION 4.04. Remedies 54
SECTION 4.05. Return of the Aircraft, etc 58
SECTION 4.06. Remedies Cumulative 59
SECTION 4.07. Discontinuance of Proceedings 60
SECTION 4.08. Waiver of Past Indenture Defaults 60
SECTION 4.09. Indenture Trustee May Prove Debt 60
SECTION 4.10. Limitations on Suits by Note Holders 62
SECTION 4.11. Unconditional Right of Note Holders to
Receive Principal, Interest and Premium,
and to Institute Certain Suits 63
SECTION 4.12. Exercise of Remedies by Foreign Note
Holders 63
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Indenture Event of Default 63
SECTION 5.02. Action Upon Instructions 65
SECTION 5.03. Indemnification 65
SECTION 5.04. No Duties Except as Specified in
Indenture or Instructions 66
SECTION 5.05. No Action Except Under Lease, Refunding
Agreement, Indenture or Instructions 66
SECTION 5.06. Replacement Airframes, Replacement
Engines and Replacement Parts 67
SECTION 5.07. Indenture Supplements for Replacements 70
SECTION 5.08. Effect of Replacement 71
SECTION 5.09. Notices, etc. 71
SECTION 5.10. Certain Rights of Owner Trustee and
Owner Participant 71
SECTION 5.11. Evidence of Action Taken by Note Holder 74
SECTION 5.12. Right of Revocation of Action Taken 74
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Trust Indenture
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ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties 74
SECTION 6.02. Absence of Duties 75
SECTION 6.03. No Representations or Warranties as to
Aircraft or Documents 75
SECTION 6.04. No Segregation of Moneys; No Interest 76
SECTION 6.05. Reliance; Agents; Advice of Counsel 76
SECTION 6.06. Capacity in Which Acting 77
SECTION 6.07. Compensation 77
SECTION 6.08. May Become Note Holder 78
SECTION 6.09. Further Assurances; Financing
Statements 78
ARTICLE VII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification 78
SECTION 7.02. Exculpation and Release of Liability 79
ARTICLE VIII
SUCCESSOR TRUSTEES AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee 80
SECTION 8.02. Resignation and Removal of Indenture
Trustee; Appointment of Successor 80
SECTION 8.03. Appointment of Separate Trustees 82
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS TO THIS
INDENTURE AND OTHER DOCUMENTS
SECTION 9.01. Lease Amendments and Supplemental
Indentures 84
SECTION 9.02. Effect of Supplemental Indenture 87
SECTION 9.03. Documents to Be Given to Trustee 87
SECTION 9.04. Notation on Notes in Respect of
Supplemental Indentures 87
SECTION 9.05. Trustees Protected 87
SECTION 9.06. Documents Mailed to Note Holders 88
SECTION 9.07. No Request Necessary for Lease
Supplement or Indenture Supplement 88
SECTION 9.08. Notices to Liquidity Provider 88
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Trust Indenture
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ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Indenture 88
SECTION 10.02. No Legal Title to Trust Indenture
Estate in Note Holders 89
SECTION 10.03. Sale of Aircraft by Indenture
Trustee is Binding 89
SECTION 10.04. Indenture for Benefit of Owner Trustee,
Indenture Trustee, Owner Participant,
Lessee and Note Holders 89
SECTION 10.05. No Action Contrary to Lessee's Rights
Under the Lease 90
SECTION 10.06. Notices 90
SECTION 10.07. Severability 90
SECTION 10.08. No Oral Modifications or Continuing
Waivers 91
SECTION 10.09. Successors and Assigns 91
SECTION 10.10. Headings 91
SECTION 10.11. Normal Commercial Relations 91
SECTION 10.12. Governing Law; Counterpart Form 91
SECTION 10.13. Section 1110 92
EXHIBIT A - Form of Trust Indenture Supplement
SCHEDULE I - Equipment Notes Amortization
SCHEDULE II - Pass Through Trust Agreements
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Trust Indenture
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SECOND AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-10]
SECOND AMENDED AND RESTATED TRUST INDENTURE AND SECURITY AGREEMENT [GPA
1989 BN-10] (this "Second Amended and Restated Indenture" or this "Indenture")
dated as of November , 1996, between WILMINGTON TRUST COMPANY, a Delaware
banking corporation, not in its individual capacity except as otherwise
specifically set forth herein, but solely as owner trustee under the Trust
Agreement referred to below (in such capacity, together with its successors,
the "Owner Trustee"), and THE CHASE MANHATTAN BANK (formerly known as Chemical
Bank, successor by merger to Manufacturers Hanover Trust Company), a New York
corporation, not in its individual capacity except as otherwise specifically
set forth herein, but solely as indenture trustee hereunder (in such capacity,
together with its successors, the "Indenture Trustee").
W I T N E S S E T H :
WHEREAS, all capitalized terms used herein shall have the respective
meanings set forth or referred to in Article I hereof;
WHEREAS, the Owner Participant and Wilmington Trust Company entered into
the Trust Agreement [GPA 1989 BN-10] dated as of December 19, 1989, as
supplemented by Trust Agreement Supplement [GPA 1989 BN-10] No. 1 dated
December 22, 1989, as further supplemented by Trust Agreement Supplement [GPA
1989 BN-10] No. 2 dated October 24, 1991, and as further supplemented by Trust
Agreement Supplement [GPA 1989 BN-10] No. 3 dated the date hereof (as amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof, hereof and of the Refunding Agreement, the "Trust Agreement"),
whereby, among other things, Wilmington Trust Company has declared a certain
trust for the use and benefit of the Owner Participant, subject, however, to
the Trust Indenture Estate created pursuant hereto for the use and benefit of
(to the extent set forth herein), and with the priority of certain payments to,
the Holders of Equipment Notes issued hereunder, and the Owner Trustee is
authorized and directed to execute and deliver this Indenture;
WHEREAS, (i) the Owner Trustee and the Indenture Trustee entered into the
Trust Indenture and Security Agreement [GPA 1989 BN-10] dated as of December
19, 1989, as supplemented by Trust Indenture Supplement No. 1 dated December
22, 1989, which were recorded by the Federal Aviation Administration on
December 27, 1989 as one instrument and assigned Conveyance No.
Trust Indenture
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S86321 (as so supplemented or otherwise modified to the date hereof, the
"Original Indenture"), (ii) the Owner Trustee and the Original Head Lessee
entered into the Aircraft Lease Agreement [GPA 1989 BN-10] dated as of December
19, 1989, as supplemented by Lease Supplement [GPA 1989 BN-10] No. 1 dated
December 22, 1989, which were recorded by the Federal Aviation Administration
on December 27, 1989 as one instrument and assigned Conveyance No. S86322 (as
so supplemented or otherwise modified to the date hereof, the "Original Lease")
and (iii) pursuant to the Original Indenture, the Owner Trustee issued and sold
to the Original Loan Participants (as defined in the Original Indenture) the
Original Loan Certificates;
WHEREAS, (i) the Owner Trustee and the Indenture Trustee entered into an
Amended and Restated Trust Indenture and Security Agreement [GPA 1989 BN-10]
dated as of October 1, 1991, as supplemented by the Trust Indenture Supplement
No. 2 [GPA 1989 BN-10], dated October 24, 1991, which were recorded by the
Federal Aviation Administration on October 25, 1991 as one document and
assigned Conveyance No. Q52003 (as amended, supplemented or otherwise modified
to the date hereof, the "First Amended and Restated Indenture"), (ii) the Owner
Trustee and the Original Head Lessee entered into an Amended and Restated
Aircraft Lease Agreement [GPA 1989 BN-10] dated as of October 1, 1991, which
amended and restated the Original Lease, as supplemented by Lease Supplement
[GPA 1989 BN-10] No. 2 dated October 24, 1991, which were recorded by the
Federal Aviation Administration on October 25, 1991 as one document and
assigned Conveyance No. Q52004 (as amended, supplemented or otherwise modified
to the date hereof, the "First Amended and Restated Lease") and (iii) pursuant
to the First Amended and Restated Indenture, the Owner Trustee issued and sold
to the Certificate Holders (as defined in the First Amended and Restated
Indenture) Equipment Trust Certificates, Series BN-10 in exchange for the
Original Loan Certificates;
WHEREAS, the parties have agreed to (i) amend and restate the First Amended
and Restated Lease pursuant to Amendment No. 1 to Aircraft Lease Agreement and
Termination dated as of the date hereof between the Original Head Lessee, as
assignor and the Original Sublessee, as assignee, the Owner Trustee and the
Indenture Trustee (as so amended and restated, the "Second Amended and Restated
Lease" or the "Lease") and to enter into Lease Supplement No. 3 and (ii) cause
the implementation of the Refinancing Transaction pursuant to which, among other
things, the Equipment Trust Certificates issued to the Certificate Holders
pursuant to the First Amended and Restated Indenture shall be redeemed and new
Equipment Notes shall be issued to the Pass Through Trustees (or their
designee);
Trust Indenture
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WHEREAS, in light of the foregoing and in anticipation of the Refinancing
Transaction, the parties desire by this Second Amended and Restated Indenture,
among other things, (i) to amend and restate in its entirety the First Amended
and Restated Indenture, (ii) to provide for the issuance by the Owner Trustee
of the Equipment Notes and (iii) to provide for the assignment, mortgage and
pledge by the Owner Trustee to the Indenture Trustee, as part of the Trust
Indenture Estate hereunder, among other things, of certain of the Owner
Trustee's estate, right, title and interest in and to the Aircraft and, except
as hereinafter expressly provided, all of the Owner Trustee's right, title and
interest in, to and under the Lease (as amended and restated to date and as the
same may at any time and from time to time be further amended, restated or
otherwise modified in accordance with the terms thereof and hereof) and all
payments and other amounts received hereunder or thereunder in accordance with
the terms hereof or thereof, as security for, among other things, the Owner
Trustee's obligations to the Indenture Trustee, for the ratable benefit and
security of the Note Holders, subject to Section 2.13 and Article III hereof;
WHEREAS, all things have been done to make the Equipment Notes, when
executed by the Owner Trustee and authenticated, issued and delivered by the
Indenture Trustee hereunder, the legal, valid and binding obligations of the
Owner Trustee; and
WHEREAS, all things necessary to make this Second Amended and Restated
Indenture the legal, valid and binding obligation of the Owner Trustee, for the
uses and purposes herein set forth, in accordance with its terms, have been
done and performed and have happened;
GRANTING CLAUSE
NOW, THEREFORE, THIS SECOND AMENDED AND RESTATED TRUST INDENTURE AND
SECURITY AGREEMENT WITNESSETH, that, to secure the prompt payment of the
Principal Amount of, interest on, Make-Whole Amount, if any, and all other
amounts due with respect to, all Equipment Notes from time to time outstanding
hereunder and the performance and observance by the Owner Trustee of all the
agreements, covenants and provisions contained herein and in the Refunding
Agreement and the Equipment Notes, for the benefit of the Note Holders, and the
prompt payment of any and all amounts from time to time owing hereunder and
under the Refunding Agreement by the Owner Trustee, the Owner Participant and
the Lessee to the Note Holders and for the uses and purposes and subject to the
terms and provisions hereof, and in consideration
Trust Indenture
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of the premises and of the covenants herein contained, and of the acceptance of
the Equipment Notes by the Holders thereof, and of the sum of $1 paid to the
Owner Trustee by the Indenture Trustee at or before the delivery hereof, the
receipt whereof is hereby acknowledged, the Owner Trustee has granted,
bargained, sold, assigned, transferred, conveyed, mortgaged, pledged and
confirmed, and does hereby grant, bargain, sell, assign, transfer, convey,
mortgage, pledge and confirm, unto the Indenture Trustee, its successors and
assigns, for the security and benefit of the Note Holders from time to time, a
first priority security interest in and mortgage Lien on all estate, right,
title and interest of the Owner Trustee in, to and under the following described
property, rights, interests and privileges, whether now or hereafter acquired,
other than Excepted Payments (which collectively, excluding Excepted Payments
but including all property hereafter specifically subjected to the Lien of this
Indenture by any Indenture Supplement or any indenture supplemental hereto, are
included within the Trust Indenture Estate), to wit:
(1) the Aircraft (including the Airframe and the Engines) and all
replacements thereof and substitutions therefor to which the Owner
Trustee shall from time to time acquire an interest under the Lease, all
as more particularly described in the Indenture Supplement executed and
delivered with respect to the Aircraft or any such replacements or
substitutions therefor, as provided in this Indenture, and all records,
logs and other documents to which the Owner Trustee shall from time to
time acquire an interest at any time maintained by the Lessee with
respect to the foregoing property;
(2) the Lease (including each Lease Supplement) and all Rent
thereunder, including, without limitation, all amounts of Basic Rent,
Supplemental Rent and payments of any kind thereunder; the Refunding
Agreement; the Purchase Agreement (to the extent assigned to or for the
benefit of the Owner Trustee), including the Consent and Guaranty; the
Purchase Agreement Warranties Assignment, with the Consents and Agreements
attached thereto; the Second Aircraft Warranty Xxxx of Sale; the BFE Xxxx
of Sale; each notice, letter agreement or other document related to any of
the foregoing entered into by or for the benefit of the Owner Trustee (or
assigned to the Owner Trustee); in each case including, without
limitation, (x) all rights of the Owner Trustee to exercise any election
or option or to make any decision or determination or to give any notice,
consent, waiver or approval or to take any other action under or in
respect of any such document or to accept surrender or
Trust Indenture
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redelivery of the Aircraft or any part thereof, as well as all the rights,
powers and remedies on the part of the Owner Trustee, whether arising
under any such document or by statute or at law or in equity, or
otherwise, arising out of any Lease Event of Default, and (y) any right to
restitution from the Lessee, the Manufacturer or any other Person in
respect of any determination of invalidity of any such document, it being
agreed that the rights, powers and remedies referred to in the preceding
clauses (x) and (y) are presently assigned and transferred to the
Indenture Trustee and may, except as provided in Section 5.10 or elsewhere
in this Indenture, be exercised by the Indenture Trustee without the
necessity of proceeding under Section 4.04 to exercise remedies hereunder;
(3) each Sublease Assignment and each Assigned Sublease (to the
extent assigned under such Sublease Assignment), and including, without
limitation, all rents or other payments of any kind made under such
Assigned Sublease (to the extent assigned under such Sublease Assignment),
all collateral security or credit support (in the nature of a guarantee,
letter of credit, credit insurance, Lien on or security interest in any
property or otherwise) for the obligations of the Permitted Sublessee
thereunder (to the extent assigned under such Sublease Assignment) and all
rights of the Owner Trustee to exercise any election or option or to give
any notice, consent, waiver, or approval under or with respect of any
thereof or to accept any surrender of the Aircraft or any part thereof as
well as any rights, powers or remedies on the part of the Owner Trustee
(in each case to the extent assigned to the Owner Trustee), whether
arising under any Assigned Sublease or any Sublease Assignment or by
statute or at law or in equity, or otherwise, arising out of any default
under any Assigned Sublease, it being agreed that the rights, powers and
remedies referred to above in this paragraph (3) are presently assigned
and transferred to the Indenture Trustee and may, except as provided in
Section 5.10 or elsewhere in this Indenture, be exercised by the Indenture
Trustee without the necessity of proceeding under Section 4.04 to exercise
remedies hereunder;
(4) all tolls, rents, issues, profits, revenues and other income of
the property subjected or required to be subjected to the Lien of this
Indenture, including, without limitation, all payments or proceeds
payable to the Owner Trustee after termination of the Lease with respect
to the Aircraft as the result of the sale, lease or other disposition
thereof, and all estate, right, title and
Trust Indenture
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interest of every nature whatsoever of the Owner Trustee in and to the
same and every part thereof;
(5) all requisition proceeds with respect to the Aircraft or any
part thereof (to the extent of the Owner Trustee's interest therein
pursuant to the Lease), and all insurance proceeds with respect to the
Aircraft or any part thereof, including but not limited to the insurance
required under Section 12 of the Lease or under any comparable provision
of any Assigned Sublease (but excluding any excess insurance maintained
by the Lessee and not required under Section 12 of the Lease or any
Assigned Sublease);
(6) all moneys and securities now or hereafter paid or deposited or
required to be paid or deposited to or with the Indenture Trustee by or
for the account of the Owner Trustee pursuant to any term of any
Operative Document and held or required to be held by the Indenture
Trustee hereunder;
(7) all rights of the Owner Trustee to amounts paid or payable by
the Lessee to the Owner Trustee under the Refunding Agreement and all
rights of the Owner Trustee to enforce payments of any such amounts
thereunder; and
(8) all proceeds of the foregoing.
Concurrently with the delivery of the Original Indenture, the Owner Trustee
delivered to the Indenture Trustee the chattel paper original executed
counterparts of the Original Lease and Lease Supplement No. 1, certified copies
of the Purchase Agreement, execution copies of the Purchase Agreement Warranties
Assignment, and the original Second Aircraft Warranty Xxxx of Sale. The Owner
Trustee thereafter delivered to the Indenture Trustee the original BFE Xxxx of
Sale. Concurrently with the delivery of the First Amended and Restated
Indenture, the Owner Trustee delivered to the Indenture Trustee the chattel
paper original executed counterparts of the First Amended and Restated Lease and
Lease Supplement No. 2. Concurrently with the delivery of this Second Amended
and Restated Indenture, the Owner Trustee is delivering to the Indenture Trustee
the chattel paper original executed counterparts of the Second Amended and
Restated Lease and Lease Supplement No. 3. All property referred to in this
Granting Clause, whenever acquired by the Owner Trustee, shall secure all
obligations under and with respect to the Equipment Notes at any time
outstanding. Any and all properties referred to in this Granting Clause which
are hereafter acquired by the Owner Trustee, shall, without further conveyance,
assignment or act by the Owner Trustee or the Indenture Trustee thereby become
Trust Indenture
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and be subject to the security interest hereby granted as fully and completely
as though specifically described herein.
HABENDUM CLAUSE
TO HAVE AND TO HOLD all and singular the aforesaid property unto the
Indenture Trustee, its successors and assigns, in trust for the benefit and
security of the Note Holders from time to time, except as set forth in Section
2.13 and Article III hereof without any preference, distinction or priority of
any one Equipment Note over any other regardless of when issued, and for the
uses and purposes and subject to the terms and provisions set forth in this
Indenture.
It is expressly agreed that anything herein contained to the contrary
notwithstanding, the Owner Trustee shall remain liable under the Indenture
Documents to perform all of the obligations assumed by it thereunder, all in
accordance with and pursuant to the terms and provisions thereof, and the
Indenture Trustee and the Note Holders shall have no obligation or liability
under any thereof by reason of or arising out of the assignment hereunder, nor
shall the Indenture Trustee or the Note Holders be required or obligated in any
manner to perform or fulfill any obligations of the Owner Trustee under or
pursuant to any of the Indenture Documents, or except as herein expressly
provided, to make any payment, or to make any inquiry as to the nature or
sufficiency of any payment received by it, or present or file any claim or take
any action to collect or enforce the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
The Owner Trustee does hereby constitute the Indenture Trustee the true
and lawful attorney of the Owner Trustee, irrevocably, with full power (in the
name of the Owner Trustee or otherwise) to ask, require, demand, receive and
give acquittance for any and all moneys and claims for moneys (in each case
including insurance and requisition proceeds but excluding Excepted Payments)
due and to become due to the Owner Trustee under or arising out of the
Indenture Documents and all other property which now or hereafter constitutes
part of the Trust Indenture Estate, to endorse any checks or other instruments
or orders in connection therewith and to file any claims or to take any action
or to institute any proceedings which the Indenture Trustee may deem to be
necessary or advisable in the premises. Under the Lease, the Lessee is
directed to make all payments of Rent (other than Excepted Payments) and all
other amounts which are required to be paid to or deposited with the Owner
Trustee pursuant to the Lease (other than Excepted Payments) directly to
Trust Indenture
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the Indenture Trustee at such address or addresses as the Indenture Trustee
shall specify, for application as provided in this Indenture. Pursuant to each
Sublease Assignment, each Permitted Sublessee will be directed from and after
(i) notice of the occurrence of a Lease Event of Default and (ii) notice that
the Lease is declared or deemed in default, to make all payments of rent and all
other amounts which are required to be paid to or deposited with the Lessee
pursuant to the related Assigned Sublease and which are assigned thereunder
directly to the Indenture Trustee at such address or addresses as the Indenture
Trustee shall specify, for application or to be held as provided in this
Indenture. The Owner Trustee agrees that promptly on receipt thereof, it will
transfer to the Indenture Trustee any and all moneys from time to time received
by it constituting part of the Trust Indenture Estate, for distribution by the
Indenture Trustee pursuant to this Indenture, except (a) to the extent the Owner
Trustee is entitled to distribution of such moneys pursuant to this Indenture
and (b) that the Owner Trustee shall accept for distribution pursuant to the
Trust Agreement any amounts distributed to it by the Indenture Trustee under
this Indenture.
The Owner Trustee agrees that at any time and from time to time, upon the
written request of the Indenture Trustee, the Owner Trustee will promptly and
duly execute and deliver or cause to be duly executed and delivered any and all
such further instruments and documents as the Indenture Trustee may reasonably
deem desirable in obtaining the full benefits of the assignment hereunder and
of the rights and powers herein granted.
The Owner Trustee does hereby warrant and represent that it has not
assigned or pledged, and hereby covenants that it will not assign or pledge or
otherwise dispose of, so long as this Indenture shall remain in effect and the
Lien hereof shall not have been released pursuant to Section 10.01 hereof, any
of its estate, right, title or interest hereby assigned, to anyone other than
the Indenture Trustee, and that, with respect to such estate, right, title and
interest hereby assigned, subject to its rights pursuant to Section 5.10 hereof,
it will not, except as provided in this Indenture (including, without
limitation, Section 9.01) and except as to Excepted Payments, (i) accept any
payment from the Lessee or any Permitted Sublessee under any of the Indenture
Documents, enter into any agreement amending, modifying or supplementing any of
the Indenture Documents, or execute any waiver or modification of, or consent
under, the terms of any of the Indenture Documents, (ii) settle or compromise
any claim arising under any of the Indenture Documents, (iii) give any notice or
exercise any right or take any action under any of the Indenture Documents, or
(iv) submit or consent to the submission of any dispute, difference or other
Trust Indenture
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matter arising under or in respect of any of the Indenture Documents to
arbitration thereunder. For purposes of Section 4.02(e) hereof, this is the
fourth paragraph following the Habendum Clause.
The Owner Trustee hereby ratifies and confirms its obligations under the
Indenture Documents and does hereby agree that (except as permitted herein) it
will not take, or omit to take, any action, the taking or omission of which
might result in an alteration or impairment of any of the Indenture Documents
or of any of the rights created by any thereof or the assignment hereunder.
Notwithstanding the Granting Clause or any of the preceding paragraphs,
there is hereby excluded from the foregoing sale, transfer, assignment, grant,
pledge and security interest all Excepted Payments. Further, nothing in the
Granting Clause or the preceding paragraphs shall impair any of the rights of
the Owner Trustee or the Owner Participant under Section 5.10 hereof.
IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Special Definitions. The definitions contained in the
Lease shall apply for all purposes of this Indenture except that the following
terms shall have the following meanings (such definitions to be equally
applicable to both the singular and plural forms of the terms defined) for all
purposes of this Indenture. Except as otherwise indicated, all the agreements
or instruments defined herein or in the Lease shall mean such agreements or
instruments as the same may from time to time be supplemented or amended or the
terms thereof waived or modified to the extent permitted by, and in accordance
with, the terms thereof and of the other Operative Documents and references to
various Persons shall be deemed to be references to and include their
respective permitted successors and assigns.
"Amortization Amount" means, with respect to any Principal Amount
Repayment Date, the amount set forth opposite such Principal Amount
Repayment Date on the Amortization Schedule.
"Amortization Schedule" means the amortization schedule for the
Equipment Notes delivered pursuant to Section 2.02 hereof.
Trust Indenture
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"Assigned Sublease" means a Permitted Sublease required to be
assigned to the Owner Trustee pursuant to Section 6(a) of the Lease.
"Average Life Date" for each Equipment Note to be redeemed shall be
the date which follows the redemption date by a period equal to the
Remaining Weighted Average Life at the redemption date of such Equipment
Note. "Remaining Weighted Average Life" of such Equipment Note, at the
redemption date of such Equipment Note, shall be the number of days equal
to the quotient obtained by dividing (a) the sum of the products obtained
by multiplying (i) the amount of each then remaining installment of
principal, including the payment due on the maturity date of such
Equipment Note, by (ii) the number of days from and including the
redemption date to but excluding the scheduled payment date of such
principal installment; by (b) the then unpaid Principal Amount of such
Equipment Note.
"Bankruptcy Code" means Chapter 11 of Title 11 of the United States
Code, 11 U.S.C. Section Section 101 et seq., as amended.
"BFE Xxxx of Sale" means the full warranty (as to title) xxxx of
sale covering the Buyer Furnished Equipment, transferring all right,
title and interest therein to the Owner Trustee.
"Business Day" means a day other than a Saturday, Sunday or a day on
which banks are required or authorized to close in either The City of New
York, New York or Hartford, Connecticut.
"Cash Collateral Account" means one or more Eligible Deposit
Accounts in the name of the Subordination Agent each maintained at the
Subordination Agent, into which all amounts drawn under one or more
Liquidity Facilities pursuant to Section 3.6(c) or 3.6(i) of the
Intercreditor Agreement shall be deposited.
"Code" means the Internal Revenue Code of 1986, as amended.
"Consents and Agreements" means the confirmations by the
Manufacturer and the Manufacturer's Subsidiary included in the Purchase
Agreement Assignment and the Purchase Agreement Warranties Assignment of
the transfer of rights under the Purchase Agreement.
Trust Indenture
16
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"Continuous Stay Period" has the meaning specified in Section
4.04(a).
"Corporate Trust Office" means the principal corporate trust office
of the Indenture Trustee located at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Corporate Trust Department, or such other office
at which the Indenture Trustee's corporate trust business shall be
administered that the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Trustee and the Note Holders.
"Debt" means any liability for borrowed money, or any liability for
the payment of money in connection with any letter of credit transaction,
or other liabilities evidenced or to be evidenced by bonds, debentures,
notes or other similar instruments.
"Debt Rate" means, with respect to Series A, Series B, Series C and
Series D, the rate per annum specified for such
Series under the heading "Debt Rate" in Schedule I to this Indenture.
"Delivery Date" means December 22, 1989.
"Dollars", "U.S. $" and "$" mean the lawful currency of the United
States of America.
"Downgrade Drawing" has the meaning assigned to such term in Section
3.6(c) of the Intercreditor Agreement.
"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.
"Eligible Institution" means (a) the corporate trust department of
the Subordination Agent or any Pass Through 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-
Trust Indenture
17
BN - 10 INDENTURE
- 12 -
term unsecured debt rating from each Rating Agency of at least A-3 or its
equivalent.
"Equity Collateral" has the meaning assigned to such term in the
definition of "Excepted Payments."
"Equipment Notes" means the Equipment Notes, in substantially the
form set out in Section 2.01 hereof, issued by the Owner Trustee and
authenticated by the Indenture Trustee pursuant to the terms of this
Indenture.
"Excepted Payments" means (i) indemnity payments and interest in
respect thereof paid or payable in respect of the Owner Participant, the
Trust Company, the Owner Trustee or any of their respective successors,
permitted assigns (and, in the case of a permitted assign of the Owner
Participant that is a partnership, the partners of such partnership),
directors, officers, employees, servants, agents, subsidiaries,
affiliates or shareholders by the Lessee pursuant to Section 13 of the
Lease and not in support of any payment obligation of the Owner Trustee
under any Indenture Document, (ii) any proceeds of public liability
insurance in respect of the Aircraft payable as a result of insurance
claims paid respecting, or losses suffered by, the Trust Company or the
Indenture Trustee in its individual capacity or the Owner Participant,
(iii) any proceeds of insurance maintained with respect to the Aircraft
by or for the benefit of the Owner Participant (whether directly or
through the Owner Trustee) and not required under Section 12 of the
Lease, (iv) payments of Supplemental Rent by the Lessee in respect of any
amounts payable to the Owner Participant, the Trust Company, the Owner
Trustee, or any of their respective successors, permitted assigns,
directors, officers, employees, servants, agents, subsidiaries,
affiliates or shareholders under Section 10 of the Lease or by the Lessee
or the Parent Guarantor under the Tax Indemnification Agreement, as the
case may be, and not in support of any payment obligation of the Owner
Trustee under any Indenture Document, (v) Transaction Expenses paid or
payable by the Lessee or the Parent Guarantor to the Trust Company, the
Owner Trustee, the Indenture Trustee or the Owner Participant, pursuant
to Section 21 of the Refunding Agreement or the Lease, (vi) to the extent
retained or approved as provided in Section 8(l) of the Lease payment of
Rent in accordance with the Lease, any letter of credit pursuant to
Section 8(l) of the Lease (including, without limitation, any replacement
letter of credit (the "Equity Collateral")) and any payment or proceeds
of any such Equity Collateral, and (vii) subject to the last sentence of
Section 5.10 hereof,
Trust Indenture
18
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any right to enforce the payment of any amount described in clauses (i)
through (vi) above and the proceeds thereof.
"Excess Amount" has the meaning specified in Section 2.03(b) hereof.
"FAA" means the Federal Aviation Administration of the United States
Department of Transportation or any successor agency.
"Final Drawing" means, in respect of a Liquidity Facility, a
borrowing or drawing of all available and undrawn amounts under such
Liquidity Facility in accordance with the provisions thereof other than a
Downgrade Drawing.
"Government Obligations" means direct obligations of the United
States of America that are not callable, redeemable or payable prior to
maturity, in whole or in part, directly or indirectly, by any Person.
"Indenture," "this Indenture," and "the Indenture" mean this Second
Amended and Restated Indenture, as it may from time to time be
supplemented or amended as herein provided, including as supplemented by
any Indenture Supplement pursuant hereto.
"Indenture Default" means an Indenture Event of Default or an event
or condition that, with the giving of notice or the lapse of time or
both, would become an Indenture Event of Default.
"Indenture Documents" means the Refunding Agreement; the Trust
Agreement (including any Trust Supplements); the Lease (including any
Lease Supplements); the Equipment Notes; this Indenture (including any
Indenture Supplements); any Sublease Assignment; any Assigned Sublease;
the Second Aircraft Warranty Xxxx of Sale; the Purchase Agreement,
including the Consent and Guaranty (to the extent assigned to or for the
benefit of the Owner Trustee); the Purchase Agreement Warranties
Assignment and the Consents and Agreements attached thereto; and the BFE
Xxxx of Sale.
"Indenture Event of Default" has the meaning set forth in Section
4.02 hereof.
Trust Indenture
19
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"Indentures" means, collectively, each Trust Indenture and Security
Agreement listed on Schedule 1 to the Intercreditor Agreement, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Indenture Supplement" or "Trust Indenture Supplement" means a
supplement to this Indenture, in substantially the form of Exhibit A to
this Indenture, which shall particularly describe the Aircraft and any
Replacement Airframe and Replacement Engine included in the property of
the Owner Trustee covered by this Indenture, including, without
limitation, Trust Indenture Supplement No. 1 dated December 22, 1989,
which was recorded as one instrument by the FAA with the Original
Indenture, Trust Indenture Supplement No. 2 dated October 24, 1991, which
was recorded as one instrument by the FAA with the First Amended and
Restated Indenture, and Trust Indenture Supplement No. 3 dated November
___, 1996, which is being filed for recordation as one instrument by the
FAA with this Second Amended and Restated Indenture.
"Indenture Trustee Event" means either (i) the Equipment Notes shall
have become due and payable pursuant to Section 4.04(b) or (c) of this
Indenture or (ii) the Indenture Trustee has taken action or notified the
Owner Trustee that it intends to take action to foreclose the Lien of
this Indenture or otherwise commence the exercise of any significant
remedy under this Indenture or the Lease.
"Interest Drawing" has the meaning assigned to such term in Section
3.6(a) of the Intercreditor Agreement.
"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 the Original Lease, as the same may be modified,
supplemented or amended from time to time in accordance with the
provisions thereof and hereof and of the Refunding Agreement including,
without limitation, as amended and restated by the First Amended and
Restated Lease, and as further amended and restated by Amendment No. 1 to
Aircraft Lease Agreement and Termination dated as of the date hereof and
supplemented by Lease Supplement [GPA 1989 BN-10] No. 3 dated November __,
1996, which are being filed for recordation as one instrument with the
FAA contemporaneously herewith.
Trust Indenture
20
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"Lease Default" means an event or condition that, with the giving of
notice or the lapse of time or both, would become a Lease Event of
Default.
"Lease Event of Default" means any event or condition defined as an
"Event of Default" in Section 17 of the Lease.
"Lessee" means America West Airlines, Inc., a Delaware corporation,
in its capacity as lessee under the Second Amended and Restated Lease,
and its successors, and to the extent permitted by the Refunding
Agreement, its assigns thereunder.
"Lien" means any mortgage, chattel mortgage, pledge, lien, charge,
encumbrance, lease, exercise of rights, security interest, lease in the
nature of a security interest, statutory right in rem, or claim of any
kind, including any thereof arising under any conditional sale agreement,
equipment trust agreement or title retention agreement.
"Majority in Interest of Note Holders" means, as of a particular
date of determination and subject to Section 2.6 of the Intercreditor
Agreement, the Holders of more than 50% in aggregate unpaid Principal
Amount of all Equipment Notes outstanding as of such date. For purposes
of this definition, there shall be excluded any Equipment Notes held by
the Owner Trustee or the Owner Participant or any interests of the Owner
Participant therein by reason of subrogation pursuant to Section 4.03 of
the Indenture (unless all Equipment Notes then outstanding shall be held
by the Owner Trustee or the Owner Participant) or any Equipment Notes
held by the Lessee or any Affiliate of any thereof.
"Make-Whole Amount" means, with respect to any Equipment Note, the
amount (as determined by an independent investment banker selected by
Lessee and reasonably acceptable to the Indenture Trustee and the Owner
Participant) by which (a) the present value of the remaining scheduled
payments of principal and interest from the redemption date to maturity
of such Equipment Note computed by discounting each such payment on a
semiannual basis from its respective Payment Date (assuming a 360-day
year of twelve 30-day months) using a discount rate equal to the (i) in
the case of the Series A Equipment Notes and Series B Equipment Notes,
the Treasury Yield and (ii) in the case of the Series C Equipment Notes
and Series D Equipment Notes, the Treasury Yield plus 0.75% exceeds (b)
the outstanding principal amount of such Equipment Note plus accrued
Trust Indenture
21
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interest. For purposes of determining the Make-Whole Amount, "Treasury
Yield" at the time of determination with respect to any Equipment Note
means the interest rate (expressed as a semiannual equivalent and as a
decimal and, in the case of United States Treasury bills, converted to a
bond equivalent yield) determined to be the per annum rate equal to the
semiannual yield to maturity for United States Treasury securities
maturing on the Average Life Date of such Equipment Note and trading in
the public securities market either as determined by interpolation between
the most recent weekly average yield to maturity for two series of United
States Treasury securities, trading in the public securities markets, (A)
one maturing as close as possible to, but earlier than, the Average Life
Date of such Equipment Note and (B) the other maturing as close as
possible to, but later than, the Average Life Date of such Equipment Note,
in each case as published in the most recent H.15(519) or, if a weekly
average yield to maturity for United States Treasury securities maturing
on the Average Life Date of such Equipment Note is reported on the most
recent H.15(519), such weekly average yield to maturity as published in
such H.15(519). "H.15(519)" means the weekly statistical release
designated as such, or any successor publication, published by the Board
of Governors of the Federal Reserve System. The date of determination of
a Make-Whole Amount shall be the third Business Day prior to the
applicable redemption date and the "most recent H.15(519)" means the
H.15(519) published prior to the close of business on the third Business
Day prior to the applicable redemption date.
"Non-U.S. Holder" or "Non-U.S. Person" means any Person other than a
U.S. Person or a U.S. Holder.
"Note Holder" or "Holder" means any registered holder from time to
time of one or more Equipment Notes as reflected in the Register
maintained by the Registrar.
"Officers' Certificate" means a certificate (i) signed by a
Responsible Officer of the Owner Trustee or the Lessee, as the case may
be, and (ii) signed by another officer of the Owner Trustee or the
Lessee, as the case may be, certifying as to the authority and signature
of such Responsible Officer, that is delivered to the Indenture Trustee.
"Opinion of Counsel" means a written opinion of legal counsel, who
in the case of legal counsel for the Lessee may be (i) an attorney
employed by the Lessee who is generally
Trust Indenture
22
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empowered to deliver such written opinions or (ii) Xxxxxx & Xxxxxxx or
other counsel designated by the Lessee and reasonably satisfactory to the
Indenture Trustee or, in the case of legal counsel for the Owner Trustee,
may be Morris, James, Hitchens & Xxxxxxxx or other counsel designated by
the Owner Trustee and reasonably satisfactory to the Indenture Trustee.
"Original Head Lessee" means GPA Leasing USA Sub I, Inc., a
Connecticut corporation, in its capacity as lessee under the Original
Lease and the First Amended and Restated Lease.
"Original Indenture" means the Trust Indenture and Security Agreement
[GPA 1989 BN-10] dated as of December 19, 1989, as supplemented by Trust
Indenture Supplement No. 1 dated December 22, 1989 and as in effect
immediately prior to the amendment and restatement thereof dated as of
October 1, 1991, which were recorded as one instrument by the FAA on
December 27, 1989 and assigned Conveyance No. S86321.
"Original Loan Certificates" means the Loan Certificates issued
under and as defined in the Original Indenture.
"Original Sublessee" means America West Airlines, Inc. ("AWA"), a
Delaware corporation, in its capacity as sublessee under the Aircraft
Sublease Agreement [GPA 1989 BN-10] dated as of September 21, 1990
between the Original Head Lessee in its capacity as sublessor thereunder
and AWA in its capacity as sublessee.
"Owner Participant" means Chrysler Capital Corporation, a Delaware
corporation, as Owner Participant under the Trust Agreement, and its
successors and permitted assigns.
"Parent Guarantor" means GPA Group plc, a public limited company
organized and existing under the laws of Ireland.
"Pass Through Trust" means each of the four Pass Through Trusts
established under the relevant Pass Through Trust Agreement.
"Pass Through Trust Agreement" means the Pass Through Trust
Agreements set forth on Schedule II hereto.
"Pass Through Trustee" means Fleet National Bank, a national banking
association, not in its individual capacity
Trust Indenture
23
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but solely as pass through trustee under each of the four separate Pass
Through Trust Agreements.
"Past Due Rate" means, with respect to any amount not paid when due
(whether at stated maturity, by acceleration or otherwise) under or in
respect of any Equipment Note, a rate of interest per annum (computed on
the basis of a year of 360 days comprised of twelve 30-day months) equal
to 1% in excess of the Debt Rate for such Equipment Note.
"Payment Date" means each January 2 and July 2, commencing on
January 2, 1997 (or, if any such day is not a Business Day, the
immediately succeeding Business Day) until
the Equipment Notes have been paid in full.
"Principal Amount" with respect to an Equipment Note means the
stated original principal amount of such Equipment Note and, with respect
to all Equipment Notes, means the aggregate stated original principal
amounts of all Equipment Notes.
"Principal Amount Repayment Date" means each Payment Date on which
any portion of the Principal Amount is due and payable in accordance with
the Amortization Schedule.
"Purchase Agreement Warranties Assignment" means the Purchase
Agreement Warranties Assignment [GPA 1989 BN-10] dated the Delivery Date,
between the Original Head Lessee and the Owner Trustee.
"Rating Agencies" means, collectively, at any time, each nationally
recognized rating agency which shall have been requested to rate the
Certificates issued pursuant to the Pass Through Trust Agreements and
which shall then be rating the Certificates. Initially, the Rating
Agencies shall consist of Xxxxx'x Investors Service, Inc. and Standard &
Poor's Ratings Group, a division of XxXxxx-Xxxx Inc.
"Refinancing Transaction" means the transactions contemplated by the
Refunding Agreement and the other documents entered into on and in
connection with the Refunding Agreement on the Restatement Date.
"Refunding Agreement" means the Refunding Agreement [GPA 1989 BN-10]
dated as of November ___, 1996, among the Lessee, the Original Head
Lessee, the Parent Guarantor, the Owner Trustee, the Pass Through
Trustee, the Owner
Trust Indenture
24
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Participant, the Subordination Agent and the Indenture Trustee.
"Register" has the meaning set forth in Section 2.07 hereof.
"Registrar" has the meaning set forth in Section 2.07 hereof.
"Responsible Officer" means, in the case of the Lessee, the
president or any other officer with authority of at least a vice
president or, in the case of the Owner Trustee, an officer of the Owner
Trustee in its Corporate Trust
Administration Department.
"Restatement Date" means November ___, 1996 or such other date agreed
to by the parties to the Refunding Agreement as the date for the
consummation of the Refinancing Transaction, as evidenced by the date of
the filing with the FAA of Trust Indenture Supplement No. 3.
"Second Aircraft Warranty Xxxx of Sale" means the full warranty (as
to title) xxxx of sale covering the Aircraft (excluding all of the Buyer
Furnished Equipment to be covered by the BFE Xxxx of Sale) executed by
the Original Head Lessee in favor of the Owner Trustee, dated December
22, 1990.
"Secured Obligations" has the meaning set forth in Section 2.06
hereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Series A" or "Series A Equipment Notes" means Equipment Notes
issued and designated as "Series A" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series A."
"Series B" or "Series B Equipment Notes" means Equipment Notes
issued and designated as "Series B" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series B."
"Series C" or "Series C Equipment Notes" means Equipment Notes
issued and designated as "Series C" hereunder, in the Principal Amount
and maturities and bearing interest as
Trust Indenture
25
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specified in Section 2.02 and Schedule I hereto under the heading "Series
C."
"Series D" or "Series D Equipment Notes" means Equipment Notes
issued and designated as "Series D" hereunder, in the Principal Amount
and maturities and bearing interest as specified in Section 2.02 and
Schedule I hereto under the heading "Series D."
"Sublease Assignment" means a sublease assignment by the Lessee in
favor of the Owner Trustee (including the consent thereto given by the
sublessee thereunder) with respect to the assignment of a Permitted
Sublease pursuant to Section 6(a) of the Lease.
"Transaction Expenses" means the costs, fees, expenses and
disbursements set forth in Section 21 of the Refunding Agreement.
"Trust Accounts" has the meaning assigned to such term in Section
2.2(a) of the Intercreditor Agreement.
"Trust Company" means Wilmington Trust Company, a Delaware banking
corporation, in its individual capacity and not as Owner Trustee, and its
successors under the Trust Agreement, in their respective individual
capacities and not as Owner Trustee.
"Trust Indenture Estate" or "Indenture Estate" means all estate,
right, title and interest of the Owner Trustee in and to the properties,
rights and interests covered by the Granting Clause of the Indenture,
excluding, however, in each case, Excepted Payments.
"U.S. Holder" or "U.S. Person" means any Person that is (i) a
citizen or resident of the United States, as defined in Section
7701(a)(9) of the Code (for purposes of this definition, the "United
States"), (ii) a corporation, partnership or other entity created or
organized under the laws of the United States or any political
subdivision thereof or therein or (iii) any estate or trust that is
subject to United States federal income taxation regardless of the source
of its income.
Trust Indenture
26
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ARTICLE II
THE EQUIPMENT NOTES
SECTION 2.01. Form of Equipment Notes. The Equipment Notes shall be
substantially in the form set forth below:
THIS EQUIPMENT NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR PURSUANT TO
THE SECURITIES LAWS OF ANY STATE. ACCORDINGLY, THIS EQUIPMENT
NOTE MAY NOT BE SOLD UNLESS EITHER REGISTERED UNDER THE ACT AND
SUCH APPLICABLE STATE LAWS OR AN EXEMPTION FROM SUCH
REGISTRATIONS IS AVAILABLE.
WILMINGTON TRUST COMPANY,
AS OWNER TRUSTEE UNDER TRUST AGREEMENT [GPA 1989 BN-10]
DATED AS OF DECEMBER 19, 1989, AS AMENDED.
SERIES [A/B/C/D] NON-RECOURSE EQUIPMENT NOTE DUE [ ]
ISSUED IN CONNECTION WITH ONE AIRBUS 320-231 AIRCRAFT BEARING
UNITED STATES REGISTRATION NUMBER N631AW.
No. ____ Date: [________, 1996]
$___________________
DEBT RATE MATURITY DATE
[_________] [________,____]
WILMINGTON TRUST COMPANY, not in its individual capacity but solely as
Owner Trustee (herein in such capacity called the "Owner Trustee") under that
certain Trust Agreement [GPA 1989 BN-10], dated as of December 19, 1989, as
amended, between the Owner Participant named therein and Wilmington Trust
Company (herein as such Trust Agreement may be supplemented or amended from time
to time called the "Trust Agreement"), hereby promises to pay to Fleet National
Bank, as Subordination Agent under the Intercreditor Agreement, or the
registered assignee thereof, the principal sum of $________ (the "Principal
Amount"), together with interest on the Principal Amount remaining unpaid from
time to time (calculated on the basis of a year of 360 days comprised of twelve
30-day months) from the date hereof until paid in full at a rate per annum equal
to the Debt Rate indicated above. The Principal Amount of this Equipment Note
shall be payable in installments on the dates set forth in Schedule I hereto
equal to the corresponding percentage of the Principal
Trust Indenture
27
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Amount of this Equipment Note set forth in Schedule I hereto. Accrued but
unpaid interest shall be due and payable in semiannual installments commencing
on January 2, 1997, and thereafter on July 2 and January 2 of each year, to and
including ___________, ____.
Notwithstanding the foregoing or anything to the contrary contained
herein, (i) the final payment made on this Equipment Note shall be in an amount
sufficient to discharge in full the unpaid Principal Amount and all accrued and
unpaid interest on, and any other amounts due under, this Equipment Note; and
(ii) if any date on which a payment under this Equipment Note becomes due and
payable is not a Business Day, then such payment shall not be made on such
scheduled date but shall be made on the next succeeding Business Day and if
such payment is made on such next succeeding Business Day, no interest shall
accrue on the amount of such payment during such extension.
For purposes hereof, the term "Indenture" means the Second Amended and
Restated Trust Indenture and Security Agreement [GPA 1989 BN-10], dated as of
November ___, 1996, between the Owner Trustee and The Chase Manhattan Bank
(formerly known as Chemical Bank, successor by merger to Manufacturers Hanover
Trust Company) (the "Indenture Trustee"), as the same may be amended or
supplemented from time to time. All other capitalized terms used in this
Equipment Note and not defined herein shall have the respective meanings
assigned in the Indenture.
This Equipment Note shall bear interest, payable on demand, at the Past
Due Rate (calculated on the basis of a year of 360 days comprised of twelve
30-day months) on any overdue Principal Amount, any overdue Make-Whole Amount,
if any, and (to the extent permitted by applicable law) any overdue interest
and any other amounts payable hereunder which are overdue, in each case for the
period the same is overdue. Amounts shall be overdue if not paid when due
(whether at stated maturity, by acceleration or otherwise).
All payments of all or any portion of the Principal Amount, interest,
Make-Whole Amount, if any, and other amounts, if any, to be made by the Owner
Trustee hereunder and under the Indenture or the Refunding Agreement shall be
payable only from the income and proceeds from the Trust Estate to the extent
included in the Trust Indenture Estate and only to the extent that the Owner
Trustee shall have sufficient income or proceeds from the Trust Estate to the
extent included in the Trust Indenture Estate to enable the Indenture Trustee to
make such payments in accordance with the terms of Section 2.03 and Article
Trust Indenture
28
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III of the Indenture, and each Holder hereof, by its acceptance of this
Equipment Note, agrees that it will look solely to the income and proceeds from
the Trust Indenture Estate to the extent available for distribution to the
Holder hereof as above provided and that none of the Owner Participant, the
Owner Trustee and the Indenture Trustee is personally liable or liable in any
manner, including, without limitation, extending to any assets other than the
Trust Indenture Estate to the Holder hereof for any amounts payable or any
liability under this Equipment Note or, except as provided in the Indenture or
in the Refunding Agreement, for any liability under the Indenture or the
Refunding Agreement; provided, however, that nothing herein contained shall
limit, restrict or impair any and all rights or remedies of the Indenture
Trustee hereunder, subject always to the terms and provisions of the Indenture.
There shall be maintained a Register for the purpose of registering
transfers and exchanges of Equipment Notes at the Corporate Trust Office of the
Indenture Trustee or at the office of any successor in the manner provided in
Section 2.07 of the Indenture.
Any payment of any portion of the Principal Amount and interest and other
amounts due hereunder shall be payable in Dollars in immediately available
funds at the Corporate Trust Office of the Indenture Trustee, or as otherwise
provided in the Indenture. Each such payment shall be made on the date such
payment is due and without any presentment or surrender of this Equipment Note,
except that in the case of any final payment with respect to this Equipment
Note, the Equipment Note shall be surrendered promptly thereafter to the
Indenture Trustee for cancellation.
The Holder hereof, by its acceptance of this Equipment Note, agrees that,
except as provided in the Indenture, each payment received by it hereunder shall
be applied, first, to the payment of accrued interest on this Equipment Note (as
well as any interest on any overdue Principal Amount, any overdue Make-Whole
Amount, if any, and to the extent permitted by law, any overdue interest and any
other overdue amounts hereunder) to the date of such payment, second, to the
payment of the portion of the Principal Amount of this Equipment Note then due,
third, to the payment of Make-Whole Amount, if any, and any other amount due
hereunder or under the Indenture, and fourth, the balance, if any, remaining
thereafter, to the payment of the portion of the Principal Amount of this
Equipment Note remaining unpaid in the inverse order of its normal maturity.
Trust Indenture
29
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This Equipment Note is one of the Equipment Notes referred to in the
Indenture which have been or are to be issued by the Owner Trustee pursuant to
the terms of the Indenture. The Trust Indenture Estate is held by the
Indenture Trustee as security, in part, for the Equipment Notes. The
provisions of this Equipment Note are subject to the Indenture. Reference is
hereby made to the Indenture and the Refunding Agreement for a complete
statement of the rights and obligations of the Holder of, and the nature and
extent of the security for, this Equipment Note and the rights and obligations
of the Holders of, and the nature and extent of the security for, any other
Equipment Notes executed and delivered under the Indenture, as well as for a
statement of the terms and conditions of the trusts created by the Indenture,
to all of which terms and conditions in the Indenture and the Refunding
Agreement each Holder hereof agrees by its acceptance of this Equipment Note.
As provided in the Indenture and subject to certain limitations therein
set forth, this Equipment Note is exchangeable for a like aggregate unpaid
portion of the Principal Amount of Equipment Notes of different authorized
denominations, as requested by the Holder surrendering the same.
Prior to due presentment for registration of transfer of this Equipment
Note, the Owner Trustee and the Indenture Trustee shall treat the Person in
whose name this Equipment Note is registered as the owner hereof for all
purposes whether or not this Equipment Note be overdue, and neither of the
Owner Trustee nor the Indenture Trustee shall be affected by notice to the
contrary.
This Equipment Note is subject to redemption as provided in Sections 2.10
and 2.11 of the Indenture, to purchase by the Owner Participant or the Owner
Trustee as provided in Section 2.12 of the Indenture and to acceleration by the
Indenture Trustee as provided in Section 4.04 of the Indenture.
[The indebtedness evidenced by this Equipment Note is, to the extent and
in the manner provided in the Indenture, subordinate and subject in right of
payment to the prior payment in full of the Secured Obligations (as defined in
the Indenture) in respect of [Series A Equipment Notes](1) [Series B Equipment
Notes](2) [Series C Equipment Notes](3), and this Equipment Note is
______________
(1) To be inserted in the case of Series B Equipment Notes.
(2) To be inserted in the case of Series C Equipment Notes.
Trust Indenture
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issued subject to such provisions. The Note Holder of this Equipment Note, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Indenture Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination as provided
in the Indenture and (c) appoints the Indenture Trustee his attorney-in-fact for
such purpose.](4)
Unless the certificate of authentication hereon has been executed by or on
behalf of the Indenture Trustee by manual signature, this Equipment Note shall
not be entitled to any benefit under the Indenture or be valid or obligatory
for any purpose.
THIS EQUIPMENT NOTE 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.
* * *
______________
(3) To be inserted in the case of Series D Equipment Notes.
(4) To be inserted in the case of a Series B, Series C or Series D Equipment
Note.
Trust Indenture
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IN WITNESS WHEREOF, the Owner Trustee has caused this Equipment Note to be
executed in its corporate name by its officer thereunto duly authorized on the
date hereof.
WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee
By:______________________________________
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Equipment Notes referred to in the within-mentioned
Indenture.
THE CHASE MANHATTAN BANK,
as Indenture Trustee
By:______________________________________
Name:
Title:
Trust Indenture
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SCHEDULE I
EQUIPMENT NOTES AMORTIZATION
Percentage of
Principal Amount Principal Amount
Repayment Date to be Paid
[SEE SCHEDULE I TO TRUST INDENTURE
WHICH IS INSERTED UPON ISSUANCE]
* * *
SECTION 2.02. Issuance and Terms of Equipment Notes. The Equipment Notes
shall be dated the date of issuance thereof, shall be issued in four separate
series consisting of Series A, Series B, Series C and Series D and in the
maturities and principal amounts and shall bear interest as specified in
Schedule I hereto. On the date of the consummation of the Refinancing
Transaction, (i) each Equipment Note shall be issued to the Pass Through
Trustees (or their designee) under the Pass Through Trust Agreements set forth
in Schedule II to be attached hereto in connection therewith and (ii) the
Equipment Trust Certificates issued under the First Amended and Restated Trust
Indenture shall be concurrently redeemed. The Equipment Notes shall be issued
in registered form only. The Equipment Notes shall be issued in denominations
of $1,000 and integral multiples thereof, except that one Equipment Note of
each Series may be in an amount that is not an integral multiple of $1,000.
Each Equipment Note shall bear interest at the Debt Rate (calculated on
the basis of a year of 360 days comprised of twelve 30-day months) on the
unpaid Principal Amount thereof from time to time outstanding, payable in
arrears on January 2, 1997, and on each July 2 and January 2 thereafter until
maturity.
The Principal Amount of each Equipment Note shall be payable on the dates
and in the installments equal to the corresponding percentage of the Principal
Amount as set forth in Schedule I hereto which shall be attached as Schedule I
to the Equipment Notes. Notwithstanding the foregoing, the final payment made
under each Equipment Note shall be in an amount sufficient to discharge in full
the unpaid portion of the Principal Amount and all accrued and unpaid interest
on, and any other amounts due under, such Equipment Note. Each Equipment
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Note shall bear interest at the Past Due Rate (calculated on the basis of a year
of 360 days comprised of twelve 30-day months) on any part of the Principal
Amount, Make-Whole Amount, if any, and, to the extent permitted by applicable
law, interest and any other amounts payable thereunder not paid when due for any
period during which the same shall be overdue, in each case for the period the
same is overdue. Amounts shall be overdue if not paid when due (whether at
stated maturity, by acceleration or otherwise). Notwithstanding anything to the
contrary contained herein, if any date on which a payment under any Equipment
Note becomes due and payable is not a Business Day then such payment shall not
be made on such scheduled date but shall be made on the next succeeding Business
Day and if such payment is made on such next succeeding Business Day, no
interest shall accrue on the amount of such payment during such extension.
The Owner Trustee agrees to pay to the Indenture Trustee for distribution
in accordance with Section 3.04 hereof (a) any and all indemnity amounts
received by the Owner Trustee which are payable by Lessee to (i) the Indenture
Trustee in its individual capacity, (ii) the Pass Through Trusts, (iii) the
Subordination Agent, (iv) the Liquidity Providers, or (v) the Pass Through
Trustees, in each case pursuant to Sections 10 and 13 of the Lease or Section
21 of the Refunding Agreement, (b) the Owner Trustee's pro rata share (as
defined below) of all amounts owed to the Liquidity Providers by the
Subordination Agent under each Liquidity Facility (as determined by the
Subordination Agent and notified to the Indenture Trustee) other than amounts
due as (i) repayments of the principal of advances thereunder, and (ii)
interest on Interest Drawings, Final Drawings and Applied Downgrade Drawings
(as defined in the Liquidity Facilities) under any Liquidity Facility except to
the extent included in Net Interest and Related Charges (as defined below), and
(c) any and all amounts received by the Owner Trustee which are payable by
Lessee under clause (vii) or (viii) of the definition of Supplemental Rent.
The Indenture Trustee shall have no duty or obligation to (i) verify or confirm
the accuracy of any of the amounts (other than the portion of the Principal
Amount of, and interest on, the Equipment Notes issued hereunder) paid to it by
the Owner Trustee or (ii) determine whether any amounts are owed by the Owner
Trustee under this Section 2.02. As used in this Section 2.02, "Owner
Trustee's pro rata share" means as of any time:
(A) with respect to all amounts other than Net Interest and Related
Charges, a fraction the numerator of which is the aggregate principal
balance then outstanding of the Equipment Notes issued hereunder and the
denominator of which is the aggregate principal balance then outstanding
of all Equipment Notes issued under the Indentures, plus
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(B) with respect to all Net Interest and Related Charges (x) if
there exists a Payment Default (as defined below) under any Equipment
Note a fraction, the numerator of which is the aggregate principal
balance then outstanding of the Equipment Notes and the denominator of
which is the aggregate principal balance then outstanding of all
Equipment Notes issued under Indentures under which there exists a
Payment Default or (y) at all other times, zero;
provided, however, neither the numerator nor the denominator of the fractions
in paragraphs (A) or (B) shall include any Series D Equipment Notes. As used
in this Section 2.02, "Net Interest and Related Charges" means (as determined
by the Subordination Agent and notified by the Indenture Trustee) the sum of
(i) the amount, if any, by which interest payable to any Liquidity Provider on
any Interest Drawing, Final Drawing and/or Downgrade Drawing (other than an
unapplied Downgrade Drawing) (as defined in the Liquidity Facilities) exceeds
the amount which would be payable if such advances bore interest at the
Designated Interest Rate (as defined below), (ii) the amount, if any, by which
interest payable to any Liquidity Provider on any unapplied Downgrade Drawing
(as defined in the Liquidity Facilities) exceeds the Investment Earnings on
such unapplied Downgrade Drawing plus (iii) any amounts payable under Section
2.3(b), Section 3.1, Section 3.2, Section 3.3, Section 3.9 or Section 7.7 of
each Liquidity Facility (or similar provisions of any succeeding liquidity
facility) which result from any Interest Drawing, Final Drawing or Downgrade
Drawing (as defined in the Liquidity Facilities). As used in this Section
2.02, "Designated Interest Rate" means the weighted average Past Due Rate (as
defined in the applicable Indentures) except with respect to that portion of
any Final Drawing (or Downgrade Drawing which becomes a Final Drawing) which
remains in a Cash Collateral Account, Designated Interest Rate means the
weighted average Investment Earnings of funds in the Cash Collateral Accounts.
As used in this Section 2.02, a "Payment Default" when used in connection with
an Equipment Note or an equipment note issued under another Indenture means a
default in the payment of principal thereof or interest thereon other than a
default in the payment of principal or interest on a Series D Equipment Note
which has not been cured other than solely because of acceleration. For
purposes of Section 3.04(b) hereof, this is the fourth paragraph of Section
2.02.
The Equipment Notes shall be executed on behalf of the Owner Trustee by its
President or one of its Vice Presidents, Assistant Vice Presidents or Assistant
Secretaries or other authorized officer. Equipment Notes bearing the signatures
of individuals who were at any time the proper officers of the Owner Trustee
shall bind the Owner Trustee, notwithstanding that such
Trust Indenture
35
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individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Equipment Notes or did not hold such offices
at the respective dates of such Equipment Notes. The Owner Trustee may from
time to time execute and deliver Equipment Notes with respect to the Aircraft to
the Indenture Trustee for authentication upon original issue and such Equipment
Notes shall thereupon be authenticated and delivered by the Indenture Trustee
upon the written request of the Owner Trustee signed by a Vice President or
Assistant Vice President or other authorized officer of the Owner Trustee;
provided, however, that each such request shall specify the aggregate Principal
Amount of all Equipment Notes to be authenticated hereunder on original issue
with respect to the Aircraft. No Equipment Note shall be secured by or be
entitled to any benefit under this Indenture or be valid or obligatory for any
purposes, unless there appears on such Equipment Note a certificate of
authentication in the form provided for herein executed by the Indenture Trustee
by the manual signature of one of its authorized officers and such certificate
upon any Equipment Notes shall be conclusive evidence, and the only evidence,
that such Equipment Note has been duly authenticated and delivered hereunder.
SECTION 2.03. Payments from Trust Indenture Estate Only. (a) Without
impairing any of the other rights, powers, remedies, privileges or Liens of the
Note Holders under this Indenture, each Note Holder, by its acceptance of an
Equipment Note, agrees that, except as expressly provided in this Indenture, the
Refunding Agreement or any other Operative Document, (i) the obligation to make
all payments of all or any portion of the Principal Amount of, interest on,
Make-Whole Amount, if any, and all other amounts due with respect to the
Equipment Notes, and the performance by the Owner Trustee of every obligation or
covenant contained in this Indenture and in the Refunding Agreement or any of
the other Operative Documents, shall be payable only from the income and
proceeds from the Trust Estate to the extent included in the Trust Indenture
Estate and only to the extent that the Owner Trustee shall have sufficient
income or proceeds from the Trust Estate to the extent included in the Trust
Indenture Estate to enable the Indenture Trustee to make such payments in
accordance with the terms of Article III hereof, and all of the statements,
representations, covenants and agreements made by the Owner Trustee (when made
in such capacity) contained in this Indenture and any other Operative Document
other than the Trust Agreement, unless expressly otherwise stated, are made and
intended only for the purpose of binding the Trust Estate and establishing the
existence of rights and remedies which can be exercised and enforced against the
Trust Estate; therefore, anything contained in this Indenture or such
Trust Indenture
36
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other agreements to the contrary notwithstanding (except for any express
provisions or representations that the Trust Company is responsible for, or is
making, for which there would be personal liability of the Trust Company), no
recourse shall be had with respect to this Indenture or such other agreements
against the Trust Company or against any institution or Person which becomes a
successor trustee or co-trustee or any officer, director, trustee, servant or
direct or indirect parent or controlling Person or Persons of any of them, and
(ii) none of the Trust Company, the Owner Participant, the Indenture Trustee and
any officer, director, trustee, servant, employee, agent or direct or indirect
parent or controlling Person or Persons of any of them shall have any personal
liability for any amounts payable, or other obligation owed, hereunder, under
the Refunding Agreement or any of the other Operative Documents or under the
Equipment Notes except as expressly provided herein (in the case of the Owner
Trustee and the Indenture Trustee) or therein; provided, however, nothing
contained in this Section 2.03(a) shall be construed to limit the exercise and
enforcement in accordance with the terms of this Indenture or such other
agreements of rights and remedies against the Trust Indenture Estate.
(b) If (i) all or any part of the Trust Estate becomes the property of, or
the Owner Trustee or Owner Participant becomes, a debtor subject to the
reorganization provisions of the Bankruptcy Code, (ii) pursuant to such
reorganization provisions, including Section 1111(b) of the Bankruptcy Code, the
Trust Company, the Owner Trustee or the Owner Participant is required, by reason
of the Trust Company, the Owner Trustee or the Owner Participant being held to
have recourse liability to any Note Holder or the Indenture Trustee, directly or
indirectly (other than the recourse liability of the Trust Company, the Owner
Trustee or the Owner Participant under the Operative Documents), to make payment
on account of any amount payable as Principal Amount, Make-Whole Amount, if any,
interest or other amounts on the Equipment Notes or under this Indenture and
(iii) any Note Holder or the Indenture Trustee actually receives any Excess
Amount (as hereinafter defined) which reflects any payment by the Trust Company,
the Owner Trustee or the Owner Participant on account of clause (ii) above
(other than aforesaid), then such Note Holder or the Indenture Trustee, as the
case may be, shall promptly refund to the Trust Company, the Owner Trustee or
the Owner Participant (whichever shall have made such payment) such Excess
Amount.
For purposes of this Section 2.03(b), "Excess Amount" means the amount by
which such payment exceeds the amount that would have been received by a Note
Holder or the Indenture Trustee if the Trust Company, the Owner Trustee or the
Owner
Trust Indenture
37
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Participant had not become subject to the recourse liability referred to
in clause (ii) above. Nothing contained in this Section 2.03(b) shall prevent
a Note Holder or the Indenture Trustee from enforcing any personal recourse
obligation (and retaining the proceeds thereof) of the Trust Company, the Owner
Trustee or the Owner Participant under the Refunding Agreement, this Indenture
(and any exhibits or annexes hereto or thereto) or any other Operative
Document.
SECTION 2.04. Method of Payment. (a) The Principal Amount of, interest
on, Make-Whole Amount, if any, and other amounts due under each Equipment Note
or hereunder will be payable in Dollars by wire transfer of immediately
available funds not later than 12:00 noon, New York City time, on the due date
of payment to the Indenture Trustee at the Corporate Trust Office for
distribution among the Note Holders in the manner provided herein. After
transferring (or causing the transfer of) the above amounts to the Indenture
Trustee, the Owner Trustee shall not have any responsibility for the
distribution of such payment to any Note Holder. Notwithstanding the foregoing
or any provision in any Equipment Note to the contrary, the Indenture Trustee
will use reasonable efforts to pay or cause to be paid, if so directed in
writing by any Note Holder (with a copy to the Owner Trustee), all amounts paid
by the Owner Trustee hereunder and under such Holder's Equipment Note or
Equipment Notes to such Holder or a nominee therefor (including all amounts
distributed pursuant to Article III of this Indenture) by transferring, or
causing to be transferred, by wire transfer of immediately available funds in
Dollars, prior to 2:00 p.m., New York City time, on the due date of payment, to
an account maintained by such Holder with a bank located in the continental
United States the amount to be distributed to such Holder, for credit to the
account of such Holder maintained at such bank. If the Indenture Trustee shall
fail to make any such payment as provided in the immediately preceding sentence
after its receipt of funds at the place and prior to the time specified above,
the Indenture Trustee, in its individual capacity and not as trustee and without
indemnification or right of reimbursement under any Operative Document, agrees
to compensate such Holders for loss of use of funds in accordance with industry
standards for this type of transaction until such payment is made and the
Indenture Trustee shall be entitled to any interest earned on such funds until
such payment is made. Any payment made hereunder shall be made free and clear
of and without reduction for or on account of all wire and like charges and
without any presentment or surrender of any Equipment Note, except that, in the
case of the final payment in respect of any Equipment Note, such Equipment Note
shall be surrendered to the Indenture Trustee for cancellation promptly after
such payment. Notwithstanding any
Trust Indenture
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other provision of this Indenture to the contrary, the Indenture Trustee shall
not be required to make, or cause to be made, wire transfers as aforesaid prior
to the first Business Day on which it is practicable for the Indenture Trustee
to do so if such funds were received after 12:00 noon, New York City time, at
the place of payment. Prior to the due presentment for registration of transfer
of any Equipment Note, the Owner Trustee and the Indenture Trustee shall deem
and treat the Person in whose name any Equipment Note is registered on the
Register as the absolute owner and Holder of such Equipment Note for the purpose
of receiving payment of all amounts payable with respect to such Equipment Note
and for all other purposes, and neither the Owner Trustee nor the Indenture
Trustee shall be affected by any notice to the contrary, unless and until such
change is reflected in the Register. So long as any signatory to the Refunding
Agreement or nominee thereof shall be a registered Note Holder, all payments to
it shall be made to the account of such Note Holder specified in Schedule III
thereto and otherwise in the manner provided in or pursuant to the Refunding
Agreement unless it shall have specified some other account or manner of payment
by notice to the Indenture Trustee consistent with this Section 2.04.
(b) The Indenture Trustee, as agent for the Owner Trustee, shall exclude
and withhold at the appropriate rate from each payment of Principal Amount of,
interest on, Make-Whole Amount, if any, and other amounts due hereunder or under
each Equipment Note (and such exclusion and withholding shall constitute payment
in respect of such Equipment Note) any and all United States withholding Taxes
applicable thereto as required by law. The Indenture Trustee agrees to act as
such withholding agent and, in connection therewith, whenever any present or
future United States Taxes or similar charges are required to be withheld with
respect to any amounts payable hereunder or in respect of the Equipment Notes,
to withhold such amounts (and such withholding shall constitute payment in
respect of such Equipment Note) and timely pay the same to the appropriate
authority in the name of and on behalf of the Note Holders, that it will file
any necessary United States withholding tax returns or statements when due, and
that as promptly as possible after the payment thereof it will deliver to each
Note Holder (with a copy to the Owner Trustee and the Lessee) appropriate
receipts showing the payment thereof, together with such additional documentary
evidence as any such Note Holder, the Owner Participant and the Owner Trustee
may reasonably request from time to time.
If a Note Holder which is a Non-U.S. Person has furnished to the Indenture
Trustee a properly completed and currently effective U.S. Internal Revenue
Service Form 1001 or
Trust Indenture
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W-8 (or such successor form or forms as may be required by the United States
Treasury Department) during the calendar year in which the payment hereunder or
under the Equipment Note(s) held by such Holder is made (but prior to the making
of such payment) or in either of the two preceding calendar years, and has not
notified the Indenture Trustee of the withdrawal or inaccuracy of such form
prior to the date of such payment (and the Indenture Trustee has no reason to
know that any information set forth in such form is inaccurate), the Indenture
Trustee shall withhold only the amount, if any, required by law (after taking
into account any applicable exemptions claimed by the Note Holder) to be
withheld from payments hereunder or under the Equipment Notes held by such
Holder in respect of United States federal income Tax (and such withholding
shall constitute payment in respect of such Equipment Note). If a Note Holder
(x) which is a Non-U.S. Person has furnished to the Indenture Trustee a properly
completed and currently effective U.S. Internal Revenue Service Form 4224 in
duplicate (or such successor certificate, form or forms as may be required by
the United States Treasury Department as necessary in order to avoid withholding
of United States federal income tax), during the calendar year in which the
payment is made (but prior to the making of such payment), and has not notified
the Indenture Trustee of the withdrawal or inaccuracy of such certificate or
form prior to the date of such payment (and the Indenture Trustee has no reason
to know that any information set forth in such form is inaccurate) or (y) which
is a U.S. Person has furnished to the Indenture Trustee a properly completed and
currently effective U.S. Internal Revenue Service Form W-9, if applicable, prior
to a payment hereunder or under the Equipment Notes held by such Holder, no
amount shall be withheld from payments in respect of United States federal
income tax. If any Note Holder has notified the Indenture Trustee that any of
the foregoing forms or certificates is withdrawn or inaccurate, or if such
Holder has not filed a form claiming an exemption from United States withholding
Tax or if the Code or the regulations thereunder or the administrative
interpretation thereof are at any time after the date hereof amended to require
such withholding of United States federal income taxes from payments under the
Equipment Notes held by such Holder, the Indenture Trustee agrees to withhold
from each payment due to the relevant Note Holder withholding Taxes at the
appropriate rate under law (and such withholding shall constitute payment in
respect of such Equipment Notes) and will, on a timely basis as more fully
provided above, deposit such amounts with an authorized depository and make such
returns, statements, receipts and other documentary evidence in connection
therewith as required by applicable law.
Trust Indenture
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None of the Owner Trustee, the Owner Participant or the Lessee shall have
any liability for the failure of the Indenture Trustee to withhold taxes in the
manner provided for herein or for any false, inaccurate or untrue evidence
provided by a Holder hereunder.
SECTION 2.05. Application of Payments. In the case of each Equipment
Note, each payment of Principal Amount, Make-Whole Amount, if any, and interest
or other amounts due thereon shall be applied:
First: to the payment of accrued interest on such Equipment Note
(as well as any interest on any overdue Principal Amount, any overdue
Make-Whole Amount, if any, and, to the extent permitted by law, any
overdue interest and any other overdue amounts thereunder) to the date of
such payment;
Second: to the payment of the Principal Amount of such Equipment
Note (or a portion thereof) then due thereunder;
Third: to the payment of Make-Whole Amount, if any, and any other
amount due hereunder or under such Equipment Note; and
Fourth: the balance, if any, remaining thereafter, to the payment
of the Principal Amount of such Equipment Note remaining unpaid (provided
that such Equipment Note shall not be subject to redemption except as
provided in Sections 2.10 and 2.11 hereof).
The amounts paid pursuant to clause "Fourth" above shall be applied to the
installments of Principal Amount of such Equipment Note in the inverse order of
their normal maturity.
SECTION 2.06. Termination of Interest in Trust Indenture Estate.
A Note Holder shall not, as such, have any further interest in, or other
right with respect to, the Trust Indenture Estate when the Principal Amount of,
Make-Whole Amount, if any, and interest on and other amounts due under all
Equipment Notes held by such Note Holder and all other sums then payable to
such Note Holder hereunder and under the Lease and the Refunding Agreement by
the Lessee, the Owner Participant and the Owner Trustee (collectively, the
"Secured Obligations") shall have been paid in full.
SECTION 2.07. Registration, Transfer and Exchange of Equipment Notes.
The Indenture Trustee shall keep a register (the "Register") in which the
Indenture Trustee shall provide for
Trust Indenture
41
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the registration of Equipment Notes and the registration of transfers of
Equipment Notes. No such transfer shall be given effect unless and until
registration hereunder shall have occurred. The Register shall be kept at the
Corporate Trust Office of the Indenture Trustee. The Indenture Trustee is hereby
appointed "Registrar" for the purpose of registering Equipment Notes and
transfers of Equipment Notes as herein provided. A Holder of any Equipment Note
intending to exchange such Equipment Note shall surrender such Equipment Note to
the Indenture Trustee at the Corporate Trust Office, together with a written
request from the registered Holder thereof for the issuance of a new Equipment
Note, specifying, in the case of a surrender for transfer, the name and address
of the new Holder or Holders. Upon surrender for registration of transfer of
any Equipment Note, the Owner Trustee shall execute, and the Indenture Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Equipment Notes of a like aggregate unpaid portion
of the Principal Amount and of the same series. At the option of the Note
Holder, Equipment Notes may be exchanged for other Equipment Notes of any
authorized denominations of a like aggregate unpaid portion of the Principal
Amount, upon surrender of the Equipment Notes to be exchanged to the Indenture
Trustee at the Corporate Trust Office. Whenever any Equipment Notes are so
surrendered for exchange, the Owner Trustee shall execute, and the Indenture
Trustee shall authenticate and deliver, the Equipment Notes which the Note
Holder making the exchange is entitled to receive. All Equipment Notes issued
upon any registration of transfer or exchange of Equipment Notes (whether under
this Section 2.07 or under Section 2.08 hereof or otherwise under this
Indenture) shall be the valid obligations of the Owner Trustee evidencing the
same respective obligations, and entitled to the same security and benefits
under this Indenture, as the Equipment Notes surrendered upon such registration
of transfer or exchange. Every Equipment Note presented or surrendered for
registration of transfer or exchange shall (if so required by the Indenture
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Indenture Trustee duly executed by the Note Holder
or such Holder's attorney duly authorized in writing, and the Indenture Trustee
shall require evidence satisfactory to it as to the compliance of any such
transfer with the Securities Act and the securities laws of any applicable
state. The Indenture Trustee shall make a notation on each new Equipment Note
of the amount of all payments of Principal Amount previously made on the old
Equipment Note or Equipment Notes with respect to which such new Equipment Note
is issued and the date to which interest on such old Equipment Note or Equipment
Notes has been paid. Interest shall be deemed to have been paid on such new
Equipment Note to the date on which interest shall have been paid on such
Trust Indenture
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old Equipment Note, and all payments of the Principal Amount marked on such
new Equipment Note, as provided above, shall be deemed to have been made
thereon. Neither the Indenture Trustee nor the Owner Trustee shall be required
to exchange any surrendered Equipment Notes as provided above during the ten-day
period preceding the Payment Date. The Indenture Trustee will promptly notify
the Owner Trustee, the Owner Participant and Lessee of each registration of a
transfer of an Equipment Note. Any such transferee of an Equipment Note, by its
acceptance of an Equipment Note, agrees to the provisions of the Refunding
Agreement applicable to Note Holders, and shall be deemed to have represented
and warranted to the parties to the Refunding Agreement as to the matters
represented and warranted by the Subordination Agent in its capacity as the
initial Holder of the Equipment Notes. Subject to compliance by the Note Holder
and its transferee (if any) of the requirements set forth in this Section 2.07,
the Indenture Trustee and the Owner Trustee shall use all reasonable efforts to
issue new Equipment Notes upon transfer or exchange within 10 Business Days of
the date an Equipment Note is surrendered for transfer or exchange.
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Equipment Notes. If
any Equipment Note shall become mutilated, destroyed, lost or stolen, the Owner
Trustee shall, upon the written request of the Holder of such Equipment Note,
execute and the Indenture Trustee shall authenticate and deliver in replacement
thereof a new Equipment Note, payable in the same Principal Amount dated the
same date and captioned as originally issued. If the Equipment Note being
replaced has become mutilated, such Equipment Note shall be surrendered to the
Indenture Trustee and a copy thereof shall be furnished to the Owner Trustee. If
the Equipment Note being replaced has been destroyed, lost or stolen, the Holder
of such Equipment Note shall furnish to the Lessee, the Owner Trustee, the Owner
Participant and the Indenture Trustee such security or indemnity as may be
reasonably required by them to save the Lessee, the Owner Trustee, the Owner
Participant and the Indenture Trustee harmless and evidence satisfactory to the
Lessee, the Owner Trustee, the Owner Participant and the Indenture Trustee of
the destruction, loss or theft of such Equipment Note and of the ownership
thereof. If a bank or trust company with a net worth of $200,000,000 or more is
the Holder of any such destroyed, lost or stolen Equipment Note, then the
written indemnity of such Person, signed by an authorized officer thereof, in
favor of, delivered to and in form reasonably satisfactory to the Lessee, the
Owner Participant, the Owner Trustee and the Indenture Trustee shall be accepted
as satisfactory indemnity and security and no further indemnity or security
shall be required as a condition to the execution and delivery of such new
Equipment
Trust Indenture
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Note.
SECTION 2.09. Payment of Expenses on Transfer; Cancellation. (a) No
service charge shall be made to a Note Holder for any registration of transfer
or exchange of Equipment Notes, but the Indenture Trustee, as Registrar, may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Equipment Notes; provided, however, that none of the Lessee, the
Owner Trustee, the Indenture Trustee or the Owner Participant shall bear costs
of registration, transfer or exchange in connection with the consummation of
the Refinancing Transaction.
(b) The Indenture Trustee shall cancel all Equipment Notes surrendered
for replacement, redemption, transfer, exchange, payment or cancellation and
shall destroy the canceled Equipment Notes.
SECTION 2.10. Mandatory Redemptions of Equipment Notes. The Equipment
Notes are subject to redemption as provided in this Section 2.10 and Section
2.11 and purchase as provided in Section 2.12. On the date on which Lessee is
required pursuant to Section 11(a) of the Lease to make payment for an Event of
Loss with respect to the Aircraft, all of the Equipment Notes shall be redeemed
in whole at a redemption price equal to 100% of the unpaid Principal Amount
thereof, together with all accrued interest thereon to, but not including, the
date of redemption and all other amounts payable hereunder or under the
Refunding Agreement to the Note Holders but without Make-Whole Amount, all in
the order of priority specified in Section 3.02 hereof.
SECTION 2.11. Redemptions; Notice of Redemption. (a) Neither any
redemption of any Equipment Note nor any purchase by the Owner Trustee of any
Equipment Note may be made except to the extent and in the manner expressly
permitted by this Indenture. No purchase of any Equipment Note may be made by
the Indenture Trustee.
(b) Notice of redemption or purchase with respect to the Equipment Notes
shall be given by the Indenture Trustee by first-class mail, postage prepaid,
mailed not less than 15 nor more than 60 days prior to the applicable
redemption date, to each Note Holder of such Equipment Notes to be redeemed or
purchased, at such Note Holder's address appearing in the
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Register. All notices of redemption or purchase shall state: (1) the
redemption date, (2) the applicable basis for determining the redemption price,
(3) that on the redemption date, the redemption price will become due and
payable upon each such Equipment Note, and that interest on such Equipment Notes
shall cease to accrue on and after such redemption date, and (4) the place or
places where such Equipment Notes are to be surrendered for payment of the
redemption price.
(c) On or before the redemption date, the Owner Trustee (or any Person on
behalf of the Owner Trustee) shall, to the extent an amount equal to the
redemption price for the Equipment Notes to be redeemed or purchased on the
redemption date shall not then be held in the Trust Indenture Estate, deposit
or cause to be deposited with the Indenture Trustee by 12:00 noon, New York
City time, on the redemption date in immediately available funds the redemption
price of the Equipment Notes to be redeemed or purchased.
(d) Notice of redemption or purchase having been given as aforesaid, the
Equipment Notes to be redeemed or purchased shall, on the redemption date,
become due and payable at the Corporate Trust Office of the Indenture Trustee,
and from and after such redemption date (unless there shall be a default in the
payment of the redemption price) any such Equipment Notes then outstanding
shall cease to bear interest. Upon surrender of any such Equipment Note for
redemption or purchase in accordance with said notice, such Equipment Note
shall be redeemed at the redemption price. If any Equipment Note called for
redemption or purchase shall not be so paid upon surrender thereof for
redemption, the principal amount thereof shall, until paid, continue to bear
interest from the applicable redemption date at the interest rate in effect for
such Equipment Note as of such redemption date.
SECTION 2.12. Option to Purchase Equipment Notes. Either the Owner
Trustee or the Owner Participant may, upon the events and subject to the terms
and conditions and for the price set forth in this Section 2.12, purchase all
but not less than all of the Equipment Notes outstanding hereunder, and each
Note Holder agrees that it will, upon such events and subject to such terms and
conditions and upon receipt of such price, sell, assign, transfer and convey to
such purchaser or its nominee (without recourse or warranty of any kind except
as to its title to the Equipment Notes and except against Liens on such
Equipment Notes arising by, through or under such Holder), all of the right,
title and interest of such Note Holder in and to the Trust Indenture Estate,
this Indenture and the Equipment Notes held by
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it, and such purchaser or its nominee shall assume all of such Holder's
obligations under the Refunding Agreement and hereunder.
Such option to purchase the Equipment Notes may be exercised by the Owner
Trustee or the Owner Participant upon any of the following events, and, in any
such event, the purchase price thereof shall equal for each Equipment Note the
aggregate unpaid Principal Amount thereof, plus accrued and unpaid interest
thereon to, but not including, the date of purchase and all other amounts
(other than the Make-Whole Amount, except as provided in the next sentence)
then payable hereunder or under the Refunding Agreement to the Holder thereof.
Such option to purchase the Equipment Notes may be exercised: (i) upon an
Indenture Trustee Event or (ii) in the event there shall have occurred and be
continuing a Lease Event of Default, provided that if such option is exercised
pursuant to this clause (ii) at a time when there shall have occurred and be
continuing for less than 120 days a Lease Event of Default (and there is no
Indenture Trustee Event), the purchase price thereof shall equal the price
provided in the preceding sentence plus the Make-Whole Amount, if any; provided
further, that under no circumstances shall the Make-Whole Amount be payable by
the Lessee.
Such option to purchase the Equipment Notes may be exercised by the Owner
Trustee or the Owner Participant giving written notice of its election of such
option to the Indenture Trustee, which notice shall specify a date for such
purchase not more than 30 days or less than 15 days after the date of such
notice. The Indenture Trustee shall not exercise any of the remedies hereunder
or, without the consent of the Owner Trustee or the Owner Participant, under the
Lease, during the period from the time that a notice of exercise by the Owner
Participant of such option to purchase becomes irrevocable until the date on
which such purchase is required to occur pursuant to the terms of the preceding
sentence. Such election to purchase the Equipment Notes shall become irrevocable
upon the fifteenth day preceding the date specified in the written notice
described in the first sentence of this paragraph.
If the Owner Trustee or the Owner Participant on or before the date of
such purchase shall so request, the Note Holders will comply with all the
provisions of Section 2.07 to enable new Equipment Notes to be issued to the
Owner Trustee or the Owner Participant or its nominee in such denominations as
the Owner Trustee or the Owner Participant shall request. All taxes and
charges required pursuant to Section 2.09 in connection with the issuance of
such new Equipment Note shall be borne by the Owner Participant.
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SECTION 2.13. Subordination. (a) The Owner Trustee and, by acceptance
of its Equipment Notes of any Series, each Note Holder of such Series, hereby
agree that no payment or distribution shall be made on or in respect of the
Secured Obligations owed to such Note Holder of such Series, including any
payment or distribution of cash, property or securities after the commencement
of a proceeding of the type referred to in Section 4.02(g), (h) or (i) hereof,
except as expressly provided in Articles II and III hereof.
(b) By the acceptance of its Equipment Notes of any Series (other than
Series A), each Note Holder of such Series agrees that in the event that such
Note Holder, in its capacity as a Note Holder, shall receive any payment or
distribution on any Secured Obligations in respect of such Series which it is
not entitled to receive under this Section 2.13 or Article III hereof, it will
hold any amount so received in trust for the Senior Holder or Senior Holders
(as defined in Section 2.13(c) hereof) and will forthwith turn over such
payment to the Indenture Trustee in the form received to be applied as provided
in Articles II and III hereof.
(c) As used in this Section 2.13, the term "Senior Holder" or "Senior
Holders" shall mean (i) the Note Holders of Series A until the Secured
Obligations in respect of Series A Equipment Notes have been paid in full, (ii)
after the Secured Obligations in respect of Series A Equipment Notes have been
paid in full, the Note Holders of Series B until the Secured Obligations in
respect of Series B Equipment Notes have been paid in full and (iii) after the
Secured Obligations in respect of Series B Equipment Notes have been paid in
full, the Note Holders of Series C until the Secured Obligations in respect of
Series C Equipment Notes have been paid in full.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Certain Rent Distributions. Except as otherwise provided
in Sections 3.02 or 3.03 hereof, each installment of Basic Rent, any payment of
Supplemental Rent, any payment received by the Indenture Trustee as
contemplated by the first sentence of Section 4.03 hereof, and any payment
received by the Indenture Trustee pursuant to any Sublease Assignment as
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rent under any Assigned Sublease shall be promptly distributed in the following
order of priority:
first, (i) so much of such installment or payment as shall be
required to pay in full the aggregate amount of the payment or payments
of Principal Amount, and interest and other amounts (as well as any
interest on overdue Principal Amount, and to the extent permitted by
applicable law, on any overdue interest and any other overdue amounts)
then due to the Note Holders under all Series A Equipment Notes shall be
distributed to the Note Holders of Series A ratably, without priority of
one over the other, in the proportion that the amount of such payment or
payments then due under each Series A Equipment Note bears to the
aggregate amount of the payments then due under all Series A Equipment
Notes;
(ii) after giving effect to clause (i) above, so much of such
installment or payment remaining as shall be required to pay in full the
aggregate amount of the payment or payments of Principal Amount and
interest and other amounts (as well as any interest on any overdue
Principal Amount and, to the extent permitted by applicable law, on any
overdue interest and any other overdue amounts) then due to the Note
Holders under all Series B Equipment Notes shall be distributed to the
Note Holders of Series B ratably, without priority of one over the other,
in the proportion that the amount of such payment or payments then due
under each Series B Equipment Note bears to the aggregate amount of the
payments then due under all Series B Equipment Notes;
(iii) after giving effect to clause (ii) above, so much
of such installment or payment remaining as shall be required to pay in
full the aggregate amount of the payment or payments of Principal Amount
and interest and other amounts (as well as any interest on any overdue
Principal Amount and, to the extent permitted by applicable law, on any
overdue interest and any other overdue amounts) then due to the Note
Holders under all Series C Equipment Notes shall be distributed to the
Note Holders of Series C ratably, without priority of one over the other,
in the proportion that the amount of such payment or payments then due
under each Series C Equipment Note bears to the aggregate amount of the
payments then due under all Series C Equipment Notes; and
(iv) after giving effect to clause (iii) above, so much of such
installment or payment remaining as shall be required to pay in full the
aggregate amount of the payment or payments of Principal Amount and
interest and other
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amounts (as well as any interest on any overdue Principal Amount and, to
the extent permitted by applicable law, on any overdue interest and any
other overdue amounts) then due to the Note Holders under all Series D
Equipment Notes shall be distributed to the Note Holders of Series D
ratably, without priority of one over the other, in the proportion that
the amount of such payment or payments then due under each Series D
Equipment Note bears to the aggregate amount of the payments then due
under all Series D Equipment Notes; and
second, the balance, if any, of such installment or payment
remaining thereafter shall be distributed to the Owner Trustee for
distribution pursuant to the Trust Agreement; provided, however, that if
an Indenture Default shall have occurred and be continuing, then such
balance shall not be distributed as provided in this clause "second" but
shall be held by the Indenture Trustee as part of the Trust Indenture
Estate and invested in accordance with Section 3.07 hereof until
whichever of the following shall first occur: (i) all Indenture Defaults
shall have been cured or waived, in which event such balance shall be
distributed as provided in this clause "second", or (ii) Section 3.03
hereof shall be applicable, in which event such balance shall be
distributed in accordance with the provisions of said Section 3.03, or
(iii) the 180th day after receipt of such payment, in which event such
balance shall be distributed as provided in this clause "second" without
reference to this proviso.
SECTION 3.02. Event of Loss and Replacement. (a) Any payment received
by the Indenture Trustee with respect to the Airframe or the Airframe and one
or both Engines as the result of an Event of Loss thereto shall be applied to
the redemption of the Equipment Notes and to all other amounts payable
hereunder by applying such funds in the following order of priority:
first, to reimburse the Indenture Trustee for any reasonable
out-of-pocket costs or expenses incurred in connection with such Event of
Loss,
second, to pay in full the aggregate amount of the payment or
payments of unpaid Principal Amount, and unpaid interest and other
amounts (as well as any interest on overdue Principal Amount, and to the
extent permitted by applicable law, on any overdue interest and any other
overdue amounts) then due to the Note Holders under all Equipment Notes,
all in the order of priority specified in clause "first" of Section 3.01
hereof, and
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third, if and to the extent required to be paid to the Lessee (or if
directed by the Lessee, any Permitted Sublessee) in reimbursement of
payment of Stipulated Loss Value pursuant to Section 11(d) of the Lease,
to the Lessee (or if directed by the Lessee, any Permitted Sublessee),
and otherwise as provided in clause "fourth" of Section 3.03 hereof;
provided that, if a Replacement Airframe or a Replacement Airframe and one or
more Replacement Engines are to be substituted for the Airframe or the Airframe
and one or both Engines subject to such Event of Loss as provided in Section 11
of the Lease and Section 5.06 hereof, any proceeds which result from such Event
of Loss and are paid to the Indenture Trustee shall be held by the Indenture
Trustee as part of the Trust Indenture Estate as security for the obligations
of the Lessee under the Operative Documents and invested in accordance with the
terms of Section 3.07 hereof and, unless theretofore applied in accordance with
the provisions of the Lease and this Indenture, such proceeds shall, to the
extent payable to the Lessee under the Lease, be released to the Lessee (or if
directed by the Lessee, any Permitted Sublessee) upon or in connection with the
replacement thereof as provided in such Sections.
(b) Any amounts received directly or indirectly from any governmental
authority or insurer or other party pursuant to any provision of Section 11 or
12 of the Lease (other than as the result of an Event of Loss with respect to
the Airframe or the Airframe and one or both Engines) shall be applied as
provided in the applicable provisions of the Lease; provided, however, that to
the extent that any portion of such amounts held for account of the Lessee are
not at the time required to be paid to the Lessee (or any Permitted Sublessee)
pursuant to the applicable provisions of Section 11 or 12 of the Lease, shall be
held by the Indenture Trustee as security for the obligations of the Lessee
under the Operative Documents and shall be invested in accordance with the terms
of Section 3.07 hereof and at such time as the conditions specified in the Lease
for payment of such amounts to the Lessee shall be fulfilled, such portion, and
the net proceeds of any investment thereof, shall, unless theretofore applied in
accordance with the provisions of the Lease and this Indenture, be paid to the
Lessee to the extent provided in the Lease.
SECTION 3.03. Payment After Indenture Event of Default, etc. Except as
otherwise provided in Sections 2.13, 3.02, 3.04(a) and (c) and 6.07 hereof, and
notwithstanding Section 2.05 hereof, all payments received and amounts held or
realized by the Indenture Trustee after an Indenture Event of Default shall
have occurred and be continuing or after the
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Indenture Trustee has given notice to the Owner Trustee and the Owner
Participant pursuant to Section 4.04(a) hereof regarding its exercise of
remedies under Section 18 of the Lease or of the foreclosure of this Indenture,
or after the Equipment Notes shall have become due and payable as provided
herein, and all payments or amounts then held by the Indenture Trustee as part
of the Trust Indenture Estate, shall, so long as such Indenture Event of Default
shall be continuing, be promptly distributed by the Indenture Trustee in the
following order of priority, without duplication:
first, so much of such payments or amounts as shall be required to
reimburse the Indenture Trustee for all amounts due to it pursuant to
Section 6.07 hereof, plus any tax, expense, charge or other loss
(including, without limitation, all amounts to be expended at the expense
of, or charged upon the tolls, rents, revenues, issues, products and
profits of, the property included in the Trust Indenture Estate pursuant
to Section 4.05(b) hereof) incurred by the Indenture Trustee (to the
extent not previously reimbursed) (including, without limitation, the
expenses of any sale, taking or other proceeding, reasonable attorneys'
fees and expenses, court costs, and any other expenditures incurred or
expenditures or advances made by the Indenture Trustee in the protection,
exercise or enforcement of any right, power or remedy or any damages
sustained by the Indenture Trustee, liquidated or otherwise, upon such
Indenture Event of Default) shall be applied by the Indenture Trustee in
reimbursement of such expenses;
second, so much of such payments or amounts remaining as shall be
required to reimburse the then existing or prior Note Holders for
payments made pursuant to Section 5.03 hereof (to the extent not
previously reimbursed) shall be distributed to the then existing or prior
Note Holders, and if the aggregate amount remaining shall be insufficient
to pay all such amounts in full, it shall be distributed ratably, without
priority of one over any other, in accordance with the amount of the
payment or payments made by each such then existing or prior Note Holder
pursuant to said Section 5.03 and applicable (in the case of each such
then existing Note Holder) to the Equipment Notes held by such existing
Note Holder at the time of distribution by the Indenture Trustee;
third, (i) so much of such payments or amounts remaining as shall be
required to pay in full the aggregate unpaid Principal Amount of all
Series A Equipment Notes, and the accrued but unpaid interest and other
amounts due
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thereon and all other Secured Obligations in respect of the Series A
Equipment Notes (other than Make-Whole Amount, if any) to the date of
distribution, shall be distributed to the Note Holders of Series A, and in
case the aggregate amount so to be distributed shall be insufficient to
pay in full as aforesaid, then ratably, without priority of one over the
other, in the proportion that the aggregate unpaid Principal Amount of all
Series A Equipment Notes held by each Holder plus the accrued but unpaid
interest and other amounts due hereunder or thereunder (other than
Make-Whole Amount, if any) to the date of distribution, bears to the
aggregate unpaid Principal Amount of all Series A Equipment Notes held by
all such Holders plus the accrued but unpaid interest and other amounts
due thereon to the date of distribution;
(ii) after giving effect to paragraph (i) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series B Equipment Notes, and
the accrued but unpaid interest and other amounts due thereon and all
other Secured Obligations in respect of the Series B Equipment Notes
(other than Make-Whole Amount, if any) to the date of distribution, shall
be distributed to the Note Holders of Series B, and in case the aggregate
amount so to be distributed shall be insufficient to pay in full as
aforesaid, then ratably, without priority of one over the other, in the
proportion that the aggregate unpaid Principal Amount of all Series B
Equipment Notes held by each Holder plus the accrued but unpaid interest
and other amounts due hereunder or thereunder (other than Make-Whole
Amount, if any) to the date of distribution, bears to the aggregate
unpaid Principal Amount of all Series B Equipment Notes held by all such
Holders plus the accrued but unpaid interest and other amounts due
thereon to the date of distribution;
(iii) after giving effect to paragraph (ii) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series C Equipment Notes, and the
accrued but unpaid interest and other amounts due thereon and all other
Secured Obligations in respect of the Series C Equipment Notes (other than
Make-Whole Amount, if any) to the date of distribution, shall be
distributed to the Note Holders of Series C, and in case the aggregate
amount so to be distributed shall be insufficient to pay in full as
aforesaid, then ratably, without priority of one over the other, in the
proportion that the aggregate unpaid Principal Amount of all Series C
Equipment Notes held by each Holder
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plus the accrued but unpaid interest and other amounts due hereunder or
thereunder (other than Make-Whole Amount, if any) to the date of
distribution, bears to the aggregate unpaid Principal Amount of all Series
C Equipment Notes held by all such Holders plus the accrued but unpaid
interest and other amounts due thereon to the date of distribution; and
(iv) after giving effect to paragraph (iii) above, so much of such
payments or amounts remaining as shall be required to pay in full the
aggregate unpaid Principal Amount of all Series D Equipment Notes, and
the accrued but unpaid interest and other amounts due thereon and all
other Secured Obligations in respect of the Series D Equipment Notes
(other than Make-Whole Amount, if any) to the date of distribution, shall
be distributed to the Note Holders of Series D, and in case the aggregate
amount so to be distributed shall be insufficient to pay in full as
aforesaid, then ratably, without priority of one over the other, in the
proportion that the aggregate unpaid Principal Amount of all Series D
Equipment Notes held by each Holder plus the accrued but unpaid interest
and other amounts due hereunder or thereunder (other than Make-Whole
Amount, if any) to the date of distribution, bears to the aggregate
unpaid Principal Amount of all Series D Equipment Notes held by all such
Holders plus the accrued but unpaid interest and other amounts due
thereon to the date of distribution; and
fourth, the balance, if any, of such payments or amounts remaining
thereafter shall be distributed to the Owner Trustee for distribution
pursuant to the Trust Agreement and the Lease.
No Make-Whole Amount shall be due and payable on the Equipment Notes as a
consequence of the acceleration of the Equipment Notes.
SECTION 3.04. Certain Payments. (a) Any payments received by the
Indenture Trustee for which provision as to the application thereof is made in
the Lease shall be applied forthwith to the purpose for which such payment was
made in accordance with or as otherwise provided by the terms of the Lease.
(b) The Indenture Trustee will distribute promptly upon receipt any
indemnity payment received by it from the Owner Trustee or the Lessee in
respect of (i) the Indenture Trustee in its individual capacity, (ii) any Pass
Through Trust, (iii) the Subordination Agent, (iv) the Liquidity Providers, and
(v) the Pass Through Trustees, in each case whether pursuant to Section
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10 or 13 of the Lease or Section 21 of the Refunding Agreement or as
Supplemental Rent, directly to the Person entitled thereto. Any payment
received by the Indenture Trustee under clause (b) of the fourth paragraph of
Section 2.02 shall be distributed to the Subordination Agent to be distributed
in accordance with the terms of the Intercreditor Agreement, and any payment
received by the Indenture Trustee under clause (c) of the fourth paragraph of
Section 2.02 shall be distributed directly to the Persons entitled thereto.
(c) Notwithstanding anything to the contrary contained in this Article
III, any sums received by the Indenture Trustee that constitute Excepted
Payments shall be distributed promptly upon receipt by the Indenture Trustee
directly to the Person or Persons entitled thereto. Further, and
notwithstanding anything herein to the contrary, any sums received by the
Indenture Trustee under the Lease or any Sublease Assignment as security for the
obligations of the Lessee or the relevant Permitted Sublessee under the
Operative Documents shall be applied only to such obligations or as otherwise
provided in the Lease.
SECTION 3.05. Other Payments. Subject to Sections 3.03 and 3.04 hereof,
any payments received by the Indenture Trustee for which no provision as to the
application thereof is made elsewhere in this Indenture shall be distributed by
the Indenture Trustee, unless otherwise agreed in writing, subject to Section
6.07 hereof (i) to the extent received or realized at any time prior to the
payment in full of all obligations to the Note Holders secured by the Lien of
this Indenture, in the order of priority specified in Section 3.01 hereof, and
(ii) to the extent received or realized at any time after payment in full of
all obligations to the Note Holders secured by the Lien of this Indenture, in
the following order of priority:
first, to the extent payments or amounts described in clause "first"
of Section 3.03 hereof are otherwise obligations of Lessee under the
Operative Documents or for which Lessee is obligated to indemnify against
thereunder, in the manner provided in clause "first" of Section 3.03
hereof, and
second, in the manner provided in clause "fourth" of Section 3.03
hereof.
SECTION 3.06. Payments to Owner Trustee. Any amounts distributed
hereunder by the Indenture Trustee to the Owner Trustee shall be paid to the
Owner Trustee by wire transfer of funds of the type received by the Indenture
Trustee at such office and to such account or accounts of such entity or
entities
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as shall be designated by notice from the Owner Trustee to the Indenture Trustee
from time to time. The Owner Trustee hereby notifies the Indenture Trustee that
unless and until the Indenture Trustee receives notice to the contrary from the
Owner Trustee, all amounts to be distributed to the Owner Trustee pursuant to
clause "second" of Section 3.01 hereof shall be distributed by wire transfer of
funds of the type received by the Indenture Trustee to the Owner Participant's
account as may be specified pursuant to the Refunding Agreement.
SECTION 3.07. Investment of Amounts Held by Indenture Trustee. Any
amounts held by the Indenture Trustee as assignee of the Owner Trustee's rights
to hold moneys for security pursuant to Section 21(h) of the Lease shall be held
in accordance with the terms of such Section; and the Indenture Trustee hereby
agrees to perform the duties of the Owner Trustee under such Section. Except as
provided in the preceding sentence, any amounts held by the Indenture Trustee
pursuant to the proviso to clause "second" of Section 3.01 hereof, pursuant to
Section 3.02 hereof, pursuant to the second sentence of Section 3.04(c) hereof,
pursuant to the fourth sentence of Section 4.03 hereof, pursuant to a Sublease
Assignment, or pursuant to any provision of any other Operative Document
providing for amounts to be held by the Indenture Trustee which are not
distributed pursuant to the other provisions of Article III hereof shall be
invested by the Indenture Trustee from time to time in Specified Investments
selected in writing in a timely manner by the Owner Trustee or, in the event the
Owner Trustee shall so specify, by the Lessee. Unless otherwise expressly
provided in this Indenture or the Lease, any income realized as a result of any
such investment and any payments by or on behalf of the Lessee pursuant to the
Lease in respect of any losses or expenses, net of the Indenture Trustee's
reasonable fees and expenses in making such investment, shall be held and
applied by the Indenture Trustee in the same manner as the principal amount of
such investment is to be applied and any losses, net of earnings and such
reasonable fees and expenses, shall be charged against the principal amount
invested. The Indenture Trustee shall not be liable for any loss resulting from
any investment required to be made by it under this Indenture other than by
reason of its willful misconduct or gross negligence, and any such investment
may be sold (without regard to its maturity) by the Indenture Trustee without
instructions whenever the Indenture Trustee reasonably believes such sale is
necessary to make a distribution required by this Indenture.
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ARTICLE IV
COVENANTS OF TRUST COMPANY AND OWNER
TRUSTEE; INDENTURE EVENTS OF DEFAULT;
REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of Trust Company and Owner Trustee. (a) The
Trust Company hereby covenants and agrees that it will not directly or
indirectly create, incur, assume or suffer to exist any Lessor's Lien
attributable to it in its individual capacity with respect to any of the
properties or assets of the Trust Indenture Estate and shall, at its own cost
and expense promptly take such action as may be necessary duly to discharge any
such Lessor's Lien, and the Trust Company will cause restitution to be made to
the Trust Indenture Estate in the amount of any diminution of the value thereof
as the result of any Lessor's Liens attributable to it.
(b) The Owner Trustee hereby covenants and agrees as follows:
(i) the Owner Trustee will duly and punctually pay the Principal
Amount of, Make-Whole Amount, if any, and interest on and other amounts
due under the Equipment Notes and hereunder in accordance with the terms
of the Equipment Notes and this Indenture and all amounts payable by it
to the Note Holders under the Refunding Agreement and the other Operative
Documents;
(ii) the Owner Trustee will not directly or indirectly create,
incur, assume or suffer to exist any Lessor's Liens attributable to it
with respect to any of the properties or assets of the Trust Indenture
Estate, and shall, at its own cost and expense, promptly take such action
as may be necessary duly to discharge any such Lessor's Lien, and the
Owner Trustee will cause restitution to be made to the Trust Indenture
Estate in the amount of any diminution of the value thereof as the result
of any Lessor's Liens attributable to it;
(iii) in the event an officer with responsibility for or familiarity
with the transactions contemplated hereunder or under the other Operative
Documents (or any Vice President) in the Corporate Trust Administration
Department of the Owner Trustee shall have actual knowledge of an
Indenture Default or an Event of Loss, the Owner Trustee will give prompt
written notice of such Indenture Default or Event of Loss to the
Indenture Trustee, the Lessee and the Owner Participant;
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(iv) the Owner Trustee will furnish to the Indenture Trustee,
promptly upon receipt thereof, duplicates or copies of all reports,
notices, requests, demands, certificates, financial statements and other
instruments furnished to the Owner Trustee under the Lease, including,
without limitation, a copy of each report or notice received pursuant to
Section 12(f) of the Lease, to the extent that the same shall not have
been furnished, or is not required to be furnished by the Lessee, to the
Indenture Trustee pursuant to the Lease or otherwise;
(v) except as contemplated by the Operative Documents or with the
consent of the Indenture Trustee acting in accordance with Article IX
hereof, the Owner Trustee will not incur any indebtedness for borrowed
money; and
(vi) the Owner Trustee will not enter into any business or other
activity other than the business of owning the Aircraft, the leasing
thereof to the Lessee and the carrying out of the transactions
contemplated hereby and by the Lease, the Refunding Agreement, the Trust
Agreement and the other Operative Documents.
SECTION 4.02. Indenture Events of Default. "Indenture Event of Default"
means any of the following events (whatever the reason for such Indenture Event
of Default and whether such event shall be voluntary or involuntary or come
about or be effected by operation of law or pursuant to or in compliance with
any judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body):
(a) any Lease Event of Default shall occur and be continuing (other
than a failure to pay when due any amount in respect of Excepted
Payments); or
(b) the failure of the Owner Trustee to pay when due any payment of
Principal Amount of, or interest on, any Equipment Note (other than as a
result of a Lease Default) and such failure shall have continued
unremedied for ten calendar days; or the failure of the Owner Trustee to
pay when due any other amount due and payable under any Equipment Note or
hereunder (other than as a result of a Lease Default) and such failure
shall have continued unremedied for 15 calendar days after notice thereof
being given to the Owner Trustee from the Indenture Trustee or any Note
Holder; or
(c) any Lessor's Lien required to be discharged by the Trust Company
pursuant to Section 4.01(a) hereof or Section
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13 of the Refunding Agreement or by the Owner Trustee as the Owner Trustee
pursuant to Section 4.01(b)(ii) hereof or Section 13 of the Refunding
Agreement or any Lessor's Lien required to be discharged by the Owner
Participant pursuant to Section 13 of the Refunding Agreement shall remain
undischarged for a period of 30 calendar days after, as the case may be,
an officer with responsibility for or familiarity with the transactions
contemplated hereunder or under the other Operative Documents (or any Vice
President) in the Corporate Trust Administration Department of the Trust
Company or an officer of the Owner Participant shall have actual knowledge
of such Lien; provided, that no Indenture Event of Default shall arise
under this Section 4.02(c) as a result of a failure by the Owner Trustee
or the Owner Participant to observe or perform any covenant referred to in
this Section 4.02(c) if the Lessee shall have discharged all Lessor's
Liens required to be discharged by the Owner Trustee or the Owner
Participant pursuant to such covenants and compensated the Indenture
Trustee and the Trust Indenture Estate for all claims, losses and expenses
arising from the failure of the Owner Trustee or the Owner Participant, as
the case may be, to observe and perform any such covenant; or
(d) any representation or warranty made by the Owner Participant,
the Owner Trustee or the Trust Company herein or in the Refunding
Agreement or by any Person (if any) guaranteeing or supporting the
obligations of the Owner Participant under the Operative Documents or in
any related guarantee or support agreement shall prove to have been false
or incorrect when made in any respect materially adverse to the rights
and interests of the Note Holders; and if such misrepresentation is
capable of being corrected as of a subsequent date and if such correction
is being sought diligently, such misrepresentation shall not have been
corrected as of a day within 30 calendar days following notice thereof
being given to the Owner Participant, the Owner Trustee, the Trust
Company or such Person, as the case may be, by the Indenture Trustee or a
Majority in Interest of Note Holders; or
(e) any failure of the Owner Trustee to observe or perform any of
its covenants or agreements in the fourth paragraph following the
Habendum Clause hereof or in clauses (b)(v) and (b)(vi) of Section 4.01
hereof, or any failure by the Owner Participant or the Trust Company to
observe or perform any of its respective covenants in Section 9(b)(11),
10 or 14 of the Refunding Agreement; or
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(f) except as provided in the following paragraph (j), any failure
by the Owner Trustee or the Trust Company to observe or perform any other
covenant or obligation of the Owner Trustee contained in this Indenture
or in the Refunding Agreement or any failure by the Owner Participant to
observe or perform any other covenant or obligation of the Owner
Participant contained in the Refunding Agreement or any failure of any
Person that may guarantee or support the obligations of an Owner
Participant not originally party to the Refunding Agreement under the
Operative Documents to observe or perform any covenant or obligation of
such Person contained in any such guarantee or support agreement, which
failure is not remedied within a period of 30 calendar days following
notice being given to the Owner Trustee, the Owner Participant or such
Person, as the case may be, by the Indenture Trustee or a Majority in
Interest of Note Holders; or
(g) either the Trust Estate or the Owner Trustee with respect
thereto (and not in its individual capacity) or the Owner Participant or
any Person that may guarantee or support the obligations of an Owner
Participant not originally party to the Refunding Agreement under the
Operative Documents shall (i) be unable to pay its debts generally as
they become due within the meaning of the Bankruptcy Code, (ii) file, or
consent by answer or otherwise to the filing against it of a petition for
relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy or
insolvency law of any jurisdiction, (iii) make an assignment for the
benefit of its creditors, (iv) consent to the appointment of a custodian,
receiver, trustee or other officer with similar powers of itself or any
substantial part of its property, or (v) take corporate or comparable
action for the purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction
shall enter an order appointing, without consent by the Trust Estate or
the Owner Trustee with respect thereto (and not in its individual
capacity) or the Owner Participant or any Person that may guarantee or
support the obligations of an Owner Participant not originally party to
the Refunding Agreement under the Operative Documents, as the case may
be, a custodian, receiver, trustee or other officer with similar powers
with respect to it or with respect to any substantial part of its
property, or constituting an order for relief or approving a petition for
relief or reorganization or any other petition
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in bankruptcy or for liquidation or to take advantage of any bankruptcy or
insolvency law of any jurisdiction, or ordering the dissolution, winding-up or
liquidation of the Trust Estate or the Owner Trustee with respect thereto (and
not in its individual capacity) or the Owner Participant or such Person, as the
case may be; or
(i) any petition for any relief specified in the foregoing paragraph
(h) shall be filed against the Trust Estate or the Owner Trustee with
respect thereto (and not in its individual capacity) or the Owner
Participant or any Person that may guarantee or support the obligations of
an Owner Participant not originally party to the Refunding Agreement under
the Operative Documents, as the case may be, and such petition shall not
be dismissed within 60 days; or
(j) at any time when the Aircraft shall be registered in a
jurisdiction outside the United States, the Owner Trustee, the Trust
Company or the Owner Participant shall breach any covenant as may be
agreed upon pursuant to Section 11 of the Refunding Agreement as the
result of which the Lien of this Indenture shall cease to be a valid and
duly perfected Lien on the Trust Indenture Estate.
SECTION 4.03. Certain Rights. In the event of any default by the Lessee
in the payment of any installment of Basic Rent due under the Lease, the Owner
Participant may, within ten calendar days (or such longer period ending on the
expiry of the applicable grace period specified in the Lease with respect to
such default) after notice of such default, without the consent or concurrence
of any Note Holder, pay, as provided in Section 2.04 hereof, for application in
accordance with Section 3.01 hereof, a sum equal to the amount of all (but not
less than all) of the Principal Amount and interest as shall then (without
regard to any acceleration pursuant to Section 4.04(b) or (c) hereof) be due
and payable on the Equipment Notes. In the event of any default by the Lessee
in any obligation under the Lease other than the payment of Basic Rent, if such
default can be remedied by the payment of money and the Owner Trustee shall
have been furnished by the Owner Participant with all funds necessary for
remedying such default, the Owner Participant may, within fifteen calendar days
(or such longer period ending on the expiry of any applicable grace period
specified in the Lease with respect to such default) after notice of such
default, without the consent or concurrence of any Note Holder, instruct the
Owner Trustee to exercise the Owner Trustee's rights under Section 21(d) of the
Lease to perform such obligation on behalf of the Lessee. Solely for the
purpose of determining whether there exists an Indenture Event of Default, (a)
any timely payment by
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the Owner Participant pursuant to, and in compliance with, the first sentence of
this Section 4.03 shall be deemed to remedy (but solely for purposes of this
Indenture) any default by the Lessee in the payment of Basic Rent theretofore
due and payable and to remedy (but solely for purposes of this Indenture) any
default by the Owner Trustee in the payment of any amount due and payable under
the Equipment Notes or hereunder, and (b) any timely performance by the Owner
Trustee of any obligation of the Lessee under the Lease pursuant to, and in
compliance with, the second sentence of this Section 4.03 shall be deemed to
remedy (but solely for purposes of this Indenture) any default by the Lessee
under the Lease to the same extent that like performance by the Lessee itself
would have remedied such default (but any such payment or performance shall not
relieve the Lessee of its duty to pay all Rent and perform all of its
obligations pursuant to the Lease). If, on the basis specified in the preceding
sentence, such Lease Event of Default shall have been remedied, then any
declaration pursuant to the Lease that the Lease is in default, and any
declaration pursuant to this Indenture that the Equipment Notes are due and
payable or that an Indenture Event of Default exists hereunder, based upon such
Lease Event of Default, shall be deemed to be rescinded, and the Owner
Participant or the Owner Trustee, as the case may be, shall (to the extent of
any such payments made by it) be subrogated to the rights of the Note Holders
hereunder to receive such payment of Rent from the Indenture Trustee (and the
payment of interest on account of such Rent being overdue), and shall be
entitled, so long as no other Indenture Default or Indenture Event of Default
shall have occurred and be continuing or would result therefrom, to receive,
subject to the terms of this Indenture, such payment upon receipt thereof by the
Indenture Trustee; provided that the Owner Participant shall not otherwise
attempt to recover any such amount paid by it on behalf of the Lessee pursuant
to this Section 4.03 except by demanding of the Lessee payment of such amount,
or by commencing an action at law against the Lessee and obtaining and enforcing
a judgment against the Lessee for the payment of such amount; provided, however,
that at no time while an Indenture Event of Default shall have occurred and be
continuing shall any such demand be made or shall any such action be commenced
(or continued) and any amounts nevertheless received by the Owner Participant in
respect thereof shall be held in trust for the benefit of, and promptly paid to,
the Indenture Trustee for distribution as provided in Section 3.03 hereof; and
provided, further, that
(x) this Section 4.03 shall not apply with respect to any default in
the payment of Basic Rent due under the Lease, if the Lessee itself shall
have theretofore failed to pay Basic Rent in the manner required under
the Lease as to
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(i) each of the three Basic Rent Payment Dates immediately preceding the
date of such default or (ii) in the aggregate more than six Basic Rent
Payment Dates,
(y) the second sentence of this Section 4.03 shall cease to apply,
and no payment by the Owner Participant in respect of Supplemental Rent
or performance of any obligation of the Lessee under the Lease by the
Owner Trustee shall be deemed to remedy or to have remedied any Lease
Event of Default for the purposes of this Indenture, if during the
12-month period immediately preceding the relevant default by the Lessee
there shall have been expended by the Owner Participant pursuant to the
second sentence of this Section 4.03 (and shall have not been reimbursed
by the Lessee or any Permitted Sublessee themselves to the Owner Trustee
for distribution to the Owner Participant) an amount in excess of
$3,500,000, and
(z) neither the Owner Trustee nor the Owner Participant shall
(without the prior written consent of a Majority in Interest of Note
Holders) have the right to cure
any Lease Default or Lease Event of Default except as specified in this
Section 4.03.
SECTION 4.04. Remedies. (a) If an Indenture Event of Default shall have
occurred and be continuing and so long as the same shall be continuing
unremedied, then and in every such case the Indenture Trustee may (subject to
the rights of the Owner Participant or the Owner Trustee to cure any such
Indenture Event of Default set forth in Section 4.03 hereof and the obligations
of the Indenture Trustee set forth in this Section 4.04(a) and subject to
Section 10.05 hereof) exercise any or all of the rights and powers and pursue
any and all of the remedies pursuant to this Article IV and shall have and may
exercise all of the rights and remedies of a secured party under the Uniform
Commercial Code and, in the event such Indenture Event of Default is an
Indenture Event of Default referred to in paragraph (a) of Section 4.02 hereof,
the Indenture Trustee may (subject as aforesaid), at the direction of a
Majority in Interest of Note Holders, exercise any and all of the remedies
pursuant to Section 18 of the Lease and pursuant to any Sublease Assignment and
may take possession of all or any part of the properties covered or intended to
be covered by the Lien and security interest created hereby or pursuant hereto
but, in the case of the Aircraft, only as permitted by Section 18 of the Lease,
and may exclude the Owner Participant, the Owner Trustee and the Lessee and all
Persons claiming under any of them or wholly or partly therefrom; provided,
however, that the Indenture Trustee shall give the Owner Trustee and the Owner
Participant ten days' prior written
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notice of the initial exercise of such remedies by the Indenture Trustee under
the Lease (if not stayed or otherwise precluded by applicable law from giving
such notice); provided, further, that the Indenture Trustee shall give the Owner
Trustee and the Owner Participant twenty days' prior written notice of its
intention to sell the Aircraft. Without limiting any of the foregoing, it is
understood and agreed that the Indenture Trustee may exercise any right of sale
of the Aircraft available to it, even though it shall not have taken possession
of the Aircraft and shall not have possession thereof at the time of such sale.
Anything in this Indenture to the contrary notwithstanding, the Indenture
Trustee shall not be entitled to exercise any remedy hereunder if there shall
have occurred or be continuing a Lease Event of Default unless the Indenture
Trustee shall have exercised or concurrently be exercising one or more of the
remedies provided for in Section 18 of the Lease to terminate the Lease or take
possession and/or sell the Aircraft; provided, however, that such requirement to
exercise one or more of such remedies under the Lease shall not apply in
circumstances where the Indenture Trustee is, and has been, for a continuous
period in excess of 60 days or such other period as may be specified in Section
1110(a)(1)(A) of the Bankruptcy Code (such 60-day or other period being the
"Section 1110 Period"), stayed or prohibited by applicable law or court order
from exercising such remedies under the Lease (a "Continuous Stay Period");
provided further, however, that the requirement to exercise one or more of such
remedies under the Lease shall nonetheless be applicable during a Continuous
Stay Period subsequent to the expiration of the Section 1110 Period to the
extent that the continuation of such Continuous Stay Period subsequent to the
expiration of the Section 1110 Period (A) results from an agreement by the
trustee or the debtor-in-possession in such proceeding during the Section 1110
Period with the approval of the relevant court to perform the Lease in
accordance with Section 1110(a)(1)(A) of the Bankruptcy Code and continues to
perform as required by Section 1110(a)(1) of the Bankruptcy Code or (B) is an
extension of the Section 1110 Period with the consent of the Indenture Trustee
pursuant to Section 1110(b) of the Bankruptcy Code or (C) results from the
Lessee's assumption during the Section 1110 Period with the approval of the
relevant court of the Lease pursuant to Section 365 of the Bankruptcy Code or
(D) is the consequence of the Indenture Trustee's own failure to give any
requisite notice to any Person (unless the Indenture Trustee is stayed or
otherwise precluded by applicable law from giving such notice). In the event
that the applicability of Section 1110 of the Bankruptcy Code to the Aircraft is
being contested by the Lessee in judicial proceedings, so long as the Indenture
Trustee fails to participate in such proceedings, the Owner Trustee shall have
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the right (without affecting in any way any right or remedy of the Indenture
Trustee hereunder) to participate in such proceedings.
The foregoing shall not preclude the Indenture Trustee from notifying any
Permitted Sublessee that payments under any Assigned Sublease are to be made
directly to it pursuant to the terms of the relevant Sublease Assignment, or,
except as expressly provided above, from exercising its rights or remedies
hereunder and under the other Operative Documents. For the avoidance of doubt,
it is expressly understood and agreed, subject only to the immediately
preceding paragraph, that the above-described inability of the Indenture
Trustee to exercise any right or remedy under the Lease shall in no event and
under no circumstance prevent the Indenture Trustee from otherwise exercising
all of its rights, powers and remedies under this Indenture, including without
limitation this Article IV.
(b) If an Indenture Event of Default referred to in clause (g), (h) or (i)
of Section 4.02 hereof shall have occurred, or a Lease Event of Default under
clause (e), (f) or (g) of Section 17 of the Lease shall have occurred, then and
in every such case the unpaid Principal Amount of all Equipment Notes then
outstanding, together with accrued but unpaid interest and all other amounts
due thereunder and hereunder, shall immediately and without further act become
due and payable without presentment, demand, protest or notice, all of which
are hereby waived.
(c) If any Indenture Event of Default not specified in Section 4.04(b)
hereof shall have occurred and be continuing, then and in every such case the
Indenture Trustee may (and shall, upon receipt of a written demand therefor
from a Majority in Interest of Note Holders), subject to Section 4.03 hereof,
at any time, by written notice or notices to the Owner Trustee, declare the
unpaid Principal Amount of all Equipment Notes to be due and payable, whereupon
the unpaid Principal Amount of all Equipment Notes then outstanding, together
with accrued but unpaid interest thereon and all other amounts due thereunder
and hereunder, shall immediately become due and payable without presentment,
demand, protest or further notice, all of which are hereby waived.
(d) Sections 4.04(b) and (c), however, are subject to the condition that,
if at any time after the Principal Amount of the Equipment Notes shall have
become so due and payable, and before any judgment or decree for the payment of
the money so due, or any thereof, shall be entered, all overdue payments of
interest upon the Equipment Notes and all other amounts payable under the
Equipment Notes (except the Principal Amount of the
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Equipment Notes which by such declaration shall have become payable) shall have
been duly paid and every other Indenture Default and Indenture Event of Default
with respect to any covenant or provision of this Indenture shall have been
cured, then and in every such case a Majority in Interest of Note Holders may
(but shall not be obligated to), by written instrument filed with the Indenture
Trustee, rescind and annul the Indenture Trustee's declaration and its
consequences; but no such rescission or annulment shall extend to or affect any
subsequent Indenture Default or Indenture Event of Default or impair any right
consequent thereon.
Any acceleration pursuant to Sections 4.04(b) and (c) shall be
automatically rescinded and any related declaration of an Indenture Event of
Default annulled in the event that the Owner Trustee or the Owner Participant,
as the case may be, shall have cured, in accordance with Section 4.03, the
Indenture Event of Default that resulted in such acceleration.
Except as otherwise provided in Section 2.12, no Make-Whole Amount shall
become payable on the Equipment Notes as a result of any acceleration under
Sections 4.04(b) or 4.04(c).
(e) Each Note Holder shall be entitled, at any sale pursuant to Section 18
of the Lease, to credit against any purchase price bid at such sale by such
Note Holder all or any part of the unpaid obligations owing to such Note Holder
and secured by the Lien of this Indenture. The Owner Trustee or Owner
Participant may be a cash purchaser at any such sale.
(f) Notwithstanding anything contained herein, so long as the Pass
Through Trustee under any Pass Through Trust Agreement or the Subordination
Agent on its behalf is a Note Holder, the Indenture Trustee will not be
authorized or empowered to acquire title to any property in the Trust Indenture
Estate or take any action with respect to any property in the Trust Indenture
Estate so acquired by it if such acquisition or action would cause any trust
created pursuant to the Trust Agreement to fail to qualify as a "grantor trust"
for federal income tax purposes.
SECTION 4.05. Return of the Aircraft, etc. (a) If an Indenture Event of
Default shall have occurred and be continuing, at the request of the Indenture
Trustee the Owner Trustee shall promptly execute and deliver to the Indenture
Trustee such instruments of title and other documents as the Indenture Trustee
may deem necessary or advisable to enable the Indenture Trustee or an agent or
representative designated by the Indenture Trustee, at such time or times and
place or places as the
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Indenture Trustee may specify, to obtain possession of all or any part of the
Trust Indenture Estate; provided that the Indenture Trustee shall at the time be
entitled to obtain such possession under Section 4.04(a) and the other
applicable provisions of this Indenture. If the Owner Trustee shall for any
reason fail to execute and deliver such instruments and documents after such
request by the Indenture Trustee, the Indenture Trustee may (i) obtain a
judgment conferring on the Indenture Trustee the right to immediate possession
and requiring the Owner Trustee to execute and deliver such instruments and
documents to the Indenture Trustee, to the entry of which judgment the Owner
Trustee hereby specifically consents to the fullest extent it may lawfully do
so, and (ii) to the extent permitted by law, pursue all or part of the Trust
Indenture Estate wherever it may be found (but not in violation of Section 10.05
hereof or of the Lease) and may enter any of the premises of the Lessee wherever
such Trust Indenture Estate may be or be supposed to be and search for and take
possession of and remove the same (but not in violation of Section 10.05 hereof
or of the Lease). All expenses of obtaining such judgment or of pursuing,
searching for and taking such property shall, until paid, be secured by the Lien
of this Indenture.
(b) Upon a Lease Event of Default which is continuing, the Indenture
Trustee may, from time to time, at the expense of the Trust Indenture Estate,
make all such expenditures for maintenance, insurance, repairs, replacements,
alterations, additions and improvements to and of the Trust Indenture Estate,
as it may deem proper (it being understood and agreed that the provisions
hereof shall not be construed so as to expand the obligations of the Lessee
under the Lease). In each such case, the Indenture Trustee shall have the
right to maintain, use, operate, store, lease, control or manage the Trust
Indenture Estate and to carry on the business (without limiting the express
provisions of Section 5.10 hereof) and to exercise all rights and powers of the
Owner Participant and the Owner Trustee relating to the Trust Indenture Estate,
as the Indenture Trustee shall deem best, including the right to enter into any
and all such agreements with respect to the maintenance, insurance, use,
operation, storage, leasing, control, management or disposition of the Trust
Indenture Estate or any part thereof as the Indenture Trustee may determine;
and the Indenture Trustee shall be entitled to collect and receive directly all
tolls, rents (including Rent), revenues, issues, income, products and profits
of the Trust Indenture Estate and every part thereof, except Excepted Payments,
without prejudice, however, to the right of the Indenture Trustee under any
provision of this Indenture to collect and receive all cash held by, or
required to be deposited with, the Indenture Trustee hereunder, except Excepted
Payments.
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The Indenture Trustee shall, pursuant to the exercise of its remedies under this
Article IV, to the extent permitted by applicable law, be entitled to the
appointment of a receiver for all or any part of the Trust Indenture Estate,
whether such receivership be incidental to a proposed sale of the Trust
Indenture Estate or otherwise, and the Owner Trustee hereby consents to the
appointment of such receiver and will not oppose any such appointment. Such
tolls, rents (including Rent), revenues, issues, income, products and profits
shall be applied to pay the expenses of the use, operation, storage, leasing,
control, management or disposition of the Trust Indenture Estate and of
conducting the business thereof, and of all maintenance, repairs, replacements,
alterations, additions and improvements, and to make all payments which the
Indenture Trustee may be required or may elect to make, if any, for taxes,
assessments, insurance or other proper charges upon the Trust Indenture Estate
or any part thereof (including the employment of engineers and accountants to
examine, inspect and make reports upon the properties and books and records of
the Owner Trustee), and all other payments that the Indenture Trustee may be
required or authorized to make under any provision of this Indenture, as well as
just and reasonable compensation for the services of the Indenture Trustee, and
of all Persons properly engaged and employed by the Indenture Trustee.
SECTION 4.06. Remedies Cumulative. Each and every right, power and
remedy given to the Indenture Trustee specifically or otherwise in this
Indenture 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 be exercised from time to
time and as often and in such order as may be deemed expedient by the Indenture
Trustee, 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 the Indenture Trustee in the exercise of any right, remedy or power or in
the pursuance of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default on the part of the Owner Trustee or the
Lessee or to be an acquiescence therein.
SECTION 4.07. Discontinuance of Proceedings. In case the Indenture
Trustee or any Note Holder shall have instituted any proceeding to enforce any
right, power or remedy under this Indenture by foreclosure, entry or otherwise,
and such proceedings shall have been discontinued or abandoned for any reason
or shall have been determined adversely to the Indenture
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Trustee or such Note Holder, then and in every such case the Owner Trustee, the
Indenture Trustee, the Note Holders and the Lessee shall, subject to any
determination in such proceedings, be restored to their former positions and
rights hereunder with respect to the Trust Indenture Estate, and all rights,
remedies and powers of the Indenture Trustee and the Note Holders shall continue
as if no such proceedings had been instituted.
SECTION 4.08. Waiver of Past Indenture Defaults. Upon written
instructions from a Majority in Interest of Note Holders, the Indenture Trustee
shall waive any past Indenture Default hereunder and its consequences and upon
any such waiver such Indenture Default shall cease to exist and any Indenture
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture, but no such waiver shall extend to any subsequent or
other Indenture Default or impair any right consequent thereon; provided,
however, that in the absence of written instructions from the Holders of all
Equipment Notes then outstanding, the Indenture Trustee shall not waive any
Indenture Default (i) in the payment of the Principal Amount of or interest on
any Equipment Note then outstanding, or (ii) in respect of a covenant or
provision hereof which, under Article IX hereof, cannot be modified or amended
without the consent of each Note Holder.
SECTION 4.09. Indenture Trustee May Prove Debt. If the Owner Trustee
shall fail to pay any amount payable hereunder or under the Equipment Notes,
the Indenture Trustee, in its own name and as trustee of an express trust,
shall be entitled and empowered to institute any action or proceedings at law
or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceedings to judgment or final decree, and may
enforce any such judgment or final decree against the Owner Trustee or other
obligor upon the Equipment Notes and collect in the manner provided by law out
of the property of the Owner Trustee or other obligor upon the Equipment Notes,
wherever situated the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings relative to the Owner Trustee
under the Bankruptcy Code or any other applicable Federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official
shall have been appointed for or taken possession of the Owner Trustee or its
property, or in case of any other comparable judicial proceedings relative to
the Owner Trustee upon the Equipment Notes, or to the property of the Owner
Trustee, the Indenture Trustee, irrespective of whether the Principal Amount of
the Equipment Notes shall then be due and payable as therein
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expressed or by declaration or otherwise and irrespective of whether the
Indenture Trustee shall have made any demand pursuant to the provisions of this
Section, shall be entitled and empowered, by intervention in such proceedings or
otherwise:
(a) to file and prove a claim or claims for the whole amount of
Principal Amount and interest owing and unpaid in respect of the
Equipment Notes, and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Indenture
Trustee (including any claim for reasonable compensation, expenses and
disbursements to the Indenture Trustee and each predecessor Indenture
Trustee, and their respective agents, attorneys and counsel, and for
reimbursement of the Indenture Trustee and each predecessor Indenture
Trustee, except as a result of negligence or bad faith) and of the Note
Holders allowed in any judicial proceedings relative to the Owner Trustee
or to the property of the Owner Trustee,
(b) unless prohibited by applicable law and regulations, to vote on
behalf of the Note Holders in any election of a trustee or a standby
trustee in arrangement, reorganization, liquidation or other bankruptcy
or insolvency proceedings or Person performing similar functions in
comparable proceedings, and
(c) to collect and receive any moneys or other property payable or
deliverable on any such claims, and to distribute all amounts received
with respect to the claims of the Note Holders and of the Indenture
Trustee on their behalf;
and any trustee, receiver, or liquidator, custodian or other similar official is
hereby authorized by each of the Note Holders (by such Note Holder's acceptance
of an Equipment Note) to make payments to the Indenture Trustee, and, in the
event that the Indenture Trustee shall consent to the making of payments
directly to the Note Holders, to pay to the Indenture Trustee such amounts as
shall be sufficient to cover reasonable compensation, expenses and disbursements
to the Indenture Trustee, each predecessor Indenture Trustee and their
respective agents, attorneys and counsel, and all other expenses and liabilities
incurred by the Indenture Trustee and each predecessor Indenture Trustee except
as a result of negligence or bad faith.
Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Note Holder any plan of reorganization, arrangement, adjustment or
composition affecting
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the Equipment Notes or the rights of any Holder thereof, or to authorize the
Indenture Trustee to vote in respect of the claim of any Note Holder in any such
proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar Person.
All rights of action and of asserting claims under this Indenture, or
under any of the Equipment Notes, may be prosecuted and enforced by the
Indenture Trustee without the possession of any of the Equipment Notes or the
production thereof in any trial or other proceedings relative thereto, and any
such action or proceedings instituted by the Indenture Trustee shall be brought
in its own name as trustee of an express trust, and any recovery of judgment,
subject to the payment of the expenses, disbursements and compensation of the
Indenture Trustee, each predecessor Indenture Trustee and their respective
agents and attorneys, shall be for the ratable benefit of the Note Holders.
In any proceedings brought by the Indenture Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Note Holders, and it shall not be necessary to make
any Note Holders parties to any such proceedings.
SECTION 4.10. Limitations on Suits by Note Holders. No Note Holder shall
have any right to pursue a remedy under this Indenture or any Equipment Note,
unless such Note Holder previously shall have given to the Indenture Trustee
written notice of an Indenture Default and of the continuance thereof, as
hereinbefore provided, and unless also a Majority in Interest of Note Holders
shall have made a written request to the Indenture Trustee to pursue such remedy
and shall have offered to the Indenture Trustee such reasonable indemnity as it
may require against the costs, expenses and liabilities to be incurred therein
or thereby and the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity shall have failed to pursue such remedy
and no direction inconsistent with such written request shall have been given to
the Indenture Trustee during such 60-day period pursuant to Section 5.02 hereof;
it being understood and intended, and being expressly covenanted by each Note
Holder and the Indenture Trustee, that no one or more Note Holders shall have
any right in any manner whatever by virtue or by availing of any provision of
this Indenture to affect, disturb or prejudice the rights of any other Note
Holder or, except as otherwise provided herein (including, without limitation,
Section 2.13), to obtain or seek to obtain priority over or preference to any
other such Note Holder or to enforce any right under this Indenture, except in
the manner
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herein provided. For the protection and enforcement of the provisions of this
Section 4.10, each and every Note Holder and the Indenture Trustee shall be
entitled to such relief as can be given either at law or in equity.
SECTION 4.11. Unconditional Right of Note Holders to Receive Principal,
Interest and Premium, and to Institute Certain Suits. Notwithstanding any
other provision in this Indenture and any provision of any Equipment Note, the
right of any Note Holder to receive payment of the Principal Amount of and
interest on such Equipment Note on or after the respective due dates expressed
in such Equipment Note, or, subject to Section 4.10, to institute suit in a
manner consistent with the limitations contained in Section 4.04(a) hereof for
the enforcement of any such payment on or after such respective dates as herein
provided, shall not be impaired or affected without the consent of such Note
Holder.
SECTION 4.12. Exercise of Remedies by Foreign Note Holders. If the
Indenture Trustee shall exercise remedies pursuant to this Article IV, at a
time when (i) the Aircraft is registered with the Federal Aviation
Administration, (ii) 25% or more of the then unpaid Principal Amount of the
Equipment Notes is held by one or more Persons which are not a "citizen of the
United States" within the meaning of Section 40102(a)(15) of the Federal
Aviation Act and (iii) remedies are to be exercised pursuant to this Article IV
as a result of the occurrence of an Indenture Event of Default which is not a
Lease Event of Default, the Indenture Trustee shall make arrangements, if any,
as may be required by law so that such exercise of remedies shall not result in
the ineligibility of the
Aircraft to be registered under the Federal Aviation Act.
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Indenture Event of Default. In the event the
Indenture Trustee shall have knowledge of an Indenture Event of Default, or
shall have knowledge of an Indenture Default arising either from a failure to
pay Rent or a Lease Default of the type referred to in the second sentence of
Section 4.03, the Indenture Trustee shall give prompt notice thereof to the
Owner Trustee, the Owner Participant and the Lessee by facsimile, telex,
telegraph or telephone (confirmed by written notice in the manner provided by
Section 10.06 hereof), and to each Note Holder by first-class mail. Subject to
the terms of Sections 2.12, 4.03, 4.04, 4.08, 4.09, 5.03, 5.10 and
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10.05 hereof and of this Section 5.01, the Indenture Trustee shall take such
action, or refrain from taking such action, with respect to any Indenture Event
of Default or Indenture Default (including with respect to the exercise of any
rights or remedies hereunder) as the Indenture Trustee shall be instructed in
writing by a Majority in Interest of Note Holders. Subject to the provisions of
Section 5.03 hereof, if the Indenture Trustee shall not have received
instructions as above provided within 20 calendar days after mailing notice of
such Indenture Default or Indenture Event of Default to the Note Holders, the
Indenture Trustee may, subject to instructions thereafter received pursuant to
the preceding provisions of this Section 5.01, take such action, or refrain from
taking such action, but shall be under no duty to take or refrain from taking
any action, with respect to such Indenture Default or Indenture Event of Default
as it shall determine to be advisable and in the best interests of the Note
Holders and shall use the same degree of care and skill in connection therewith
as a prudent person would use under the circumstances in the conduct of its own
affairs; provided that the Indenture Trustee may not sell the Aircraft or any
part thereof without the consent of a Majority in Interest of Note Holders. In
the event the Indenture Trustee shall at any time elect to foreclose or
otherwise enforce this Indenture, the Indenture Trustee shall forthwith notify,
to the extent (in the case of any such party) not stayed or otherwise prohibited
by applicable law, the Owner Participant, the Note Holders, the Owner Trustee
and the Lessee. For all purposes of this Indenture, in the absence of actual
knowledge on the part of an officer in the Corporate Trust Office, in the case
of the Indenture Trustee, or its Corporate Trust Administration Department, in
the case of the Owner Trustee, the Indenture Trustee or the Owner Trustee, as
the case may be, shall not be deemed to have knowledge of an Indenture Event of
Default (except, in the case of the Indenture Trustee, the failure of the Lessee
to pay any installment of Rent when due, if any portion of such installment was
then required to be paid to the Indenture Trustee, which failure shall
constitute knowledge of an Indenture Default for purposes of the first sentence
of this Section 5.01) unless notified in writing by the Lessee, the Owner
Trustee or one or more Note Holders or, in the case of the Owner Trustee, by the
Indenture Trustee.
SECTION 5.02. Action Upon Instructions. Subject to the terms of Sections
2.12, 4.03, 4.04, 4.08, 4.09, 5.01, 5.03, 5.10, 9.01 and 10.05 hereof, upon the
written instructions at any time and from time to time of a Majority in
Interest of Note Holders, the Indenture Trustee shall take such of the
following actions as may be specified in such instructions: (i) exercise such
election or option, or make such decision or determination,
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or give such notice, consent, waiver or approval or exercise such right, remedy
or power to take such other action hereunder or under any other Indenture
Document or in respect of any part or all of the Trust Indenture Estate as shall
be specified in such instructions; (ii) take such action with respect to, or to
preserve or protect, the Trust Indenture Estate (including the discharge of
Liens) as shall be specified in such instructions and as are consistent with
this Indenture; and (iii) take such other action in respect of the subject
matter of this Indenture as is consistent with the terms hereof and of the other
Indenture Documents. The Indenture Trustee will execute and the Owner Trustee
will file or cause to be filed such continuation statements with respect to
financing statements relating to the security interest created hereunder in the
Trust Indenture Estate as may be specified from time to time in written
instructions of a Majority in Interest of Note Holders (which instructions may,
by their terms, be operative only at a future date and which shall be
accompanied by the execution form of such continuation statement so to be
filed); provided that, notwithstanding the foregoing, the Indenture Trustee may,
but shall not be obligated to, execute and file or cause to be filed any
financing statement which it from time to time deems appropriate or any
continuation statement that the Lessee, in discharge of its obligations under
Section 3(v) of the Refunding Agreement or any other Operative Document, may so
request. Notwithstanding the foregoing or anything in this Indenture to the
contrary, the Indenture Trustee may, on the advice of its counsel and without
the consent or approval of any Note Holder, approve any counsel asked to opine
on any matters under Section 11(b)(ii) of the Refunding Agreement, Section
6(a)(iii) of the Lease or under this Indenture and approve any opinion issued by
such counsel; provided, however, that this provision will not interfere with the
Owner Participant's right to consent to such counsel. None of the Owner
Participant, the Owner Trustee or the Lessee have any liability for the failure
of the Indenture Trustee to discharge its obligations hereunder.
SECTION 5.03. Indemnification. The Indenture Trustee shall not be
required to take any action or refrain from taking any action under Section
5.01 (other than the first sentence thereof) or 5.02 or Article IV hereof
unless the Indenture Trustee shall have been indemnified against any liability,
cost or expense (including counsel fees) that may be incurred in connection
therewith. The Indenture Trustee shall not be under any obligation to take any
action under this Indenture and nothing in this Indenture contained shall
require the Indenture Trustee 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
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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 Indenture Trustee shall not be required to take any action under
Section 5.01 (other than the first sentence thereof) or 5.02 or Article IV
hereof, nor shall any other provision of this Indenture be deemed to impose a
duty on the Indenture Trustee to take any action, if the Indenture Trustee shall
have been advised by counsel that such action is contrary to the terms hereof or
of the other Indenture Documents or is otherwise contrary to law.
SECTION 5.04. No Duties Except as Specified in Indenture or Instructions.
The Indenture Trustee shall not have any duty or obligation to maintain, use,
operate, store, lease, control, manage, sell, dispose of, insure or otherwise
deal with the Aircraft or any other part of the Trust Indenture Estate, or to
otherwise take or refrain from taking any action under, or in connection with,
this Indenture or any Indenture Document or any part of the Trust Indenture
Estate, except as expressly provided by the terms of this Indenture or as
expressly provided in written instructions from Note Holders as provided in this
Indenture and no implied duties or obligations shall be read into this Indenture
against the Indenture Trustee. It is understood that, as between the Indenture
Trustee and the Note Holders, with respect to all matters left to the discretion
of the Indenture Trustee hereunder, or under any Indenture Document, the
Indenture Trustee shall have the right to request written instructions from the
Note Holders and, pending receipt of such instructions from the Note Holders or
the required percentage thereof as provided herein, the Indenture Trustee shall
not be required to take any such discretionary action hereunder. The Indenture
Trustee 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 Article VII hereof or any other Operative Document) promptly take
such action as may be necessary to duly discharge all Lenders' Liens on any part
of the Trust Indenture Estate attributable to it in its individual capacity.
SECTION 5.05. No Action Except Under Lease, Refunding Agreement,
Indenture or Instructions. The Owner Trustee and the Indenture Trustee agree
that they will not use, operate, store, lease, control, manage, sell, dispose
of or otherwise deal with, or place Liens on, the Aircraft or any other part of
the Trust Indenture Estate except (i) as required or permitted by the terms of
the Lease or the Refunding Agreement, or (ii) in accordance with the powers
granted to, or the authority conferred upon, the Owner Trustee and the
Indenture Trustee pursuant to this Indenture and in accordance with the terms
hereof.
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SECTION 5.06. Replacement Airframes, Replacement Engines and Replacement
Parts. (a) If at any time and from time to time, the Airframe or Engine(s) may,
or may be required to, be replaced under Section 6(a), 11(a), 11(b) or 16(c) of
the Lease by a Replacement Airframe or Replacement Engine(s), as the case may
be, in accordance with the provisions of this Section 5.06 and the provisions
of said Sections of the Lease, the Owner Trustee shall, at such time or times,
but subject to compliance with the conditions to such replacement set forth in
the Lease, direct the Indenture Trustee to execute and deliver to or as
directed in writing by the Owner Trustee an appropriate instrument releasing
such Airframe and/or Engine(s) as appropriate from the Lien of this Indenture
and the Indenture Trustee shall execute and deliver such instrument as
aforesaid, but only upon receipt by or deposit with the Indenture Trustee of
the following:
(1) A written request from the Owner Trustee, requesting such release and
specifically describing the Airframe and/or Engine(s) so to be released and the
Replacement Airframe and/or Replacement Engine(s).
(2) A certificate signed by a duly authorized officer of the Lessee
stating the following:
A. With respect to the replacement of any Airframe:
(i) a description of the Airframe which shall be identified by
manufacturer, model, FAA registration number (or other applicable
registration number) and manufacturer's serial number;
(ii) a description of the Replacement Airframe (including the
manufacturer, model, FAA registration number (or other applicable
registration number) and manufacturer's serial number) to be received as
consideration for the Airframe to be released;
(iii) that on the date of the Indenture Supplement relating to the
Replacement Airframe the Owner Trustee will hold legal title to such
Replacement Airframe free and clear of all Liens except Permitted Liens,
that such Replacement Airframe will on such date be in good operating
condition, and that such Replacement Airframe has been or, substantially
concurrently with such replacement, is in the process of being duly
registered with the Owner Trustee as owner thereof under the Federal
Aviation Act or under the law then applicable to the registration of the
Aircraft and that an airworthiness certificate has been duly issued under
the
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Federal Aviation Act (or such other applicable law) with respect
to such Replacement Airframe, and that such registration and certificate
is in full force and effect, and the Lessee or a Permitted Sublessee will
have the full right and authority to use such Replacement Airframe;
(iv) that the insurance required by Section 12 of the Lease is in
full force and effect with respect to such Replacement Airframe and all
premiums then due thereon have been paid in full;
(v) that the Replacement Airframe is of a like Airbus A320-231 model
airframe with equivalent or better modification status delivered by the
Manufacturer not earlier than June 30, 1988;
(vi) that no Lease Event of Default has occurred and is continuing
or would result from the making and granting of the request for release
and the addition of a Replacement Airframe;
(vii) an appraisal prepared in accordance with the Appraisal
Procedure (as defined in the Lease) confirms that the Replacement
Airframe has a value, utility and remaining useful life at least equal to
that of the Airframe which suffered the Event of Loss assuming that the
same were maintained in accordance with the requirements of the Lease
whether or not they are in fact so maintained; and
(viii) that each of the conditions specified in Section 11(a) and
(c) of the Lease with respect to such Replacement Airframe have been
satisfied.
B. With respect to the replacement of any Engine:
(i) a description of the Engine which shall be identified by
manufacturer's name and serial number;
(ii) a description of the Replacement Engine (including the
manufacturer's name and serial number) to be received as consideration
for the Engine to be released;
(iii) that on the date of the Indenture Supplement relating to the
Replacement Engine the Owner Trustee will hold title to such Replacement
Engine free and clear of all Liens except Permitted Liens, that such
Replacement Engine will on such date be in good operating condition, and
that such Replacement Engine is the same or an improved model as the
Engine to be released;
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(iv) the value, remaining useful life and utility of the Replacement
Engine as of the date of such certificate (which value, remaining useful
life and utility shall not be less than the then value, remaining useful
life and utility of the Engine requested to be released, assuming such
Engine was in the condition and repair required to be maintained under
the Lease (but without regard to hours and cycles until overhaul));
(v) that no Lease Event of Default has occurred and is continuing or
would result from the making and granting of the request for release and
the addition of such Replacement Engine; and
(vi) that each of the conditions specified in Section 11(b) of the
Lease with respect to such Replacement Engine have been satisfied.
(3) The appropriate instrument or instruments (i) trans
ferring to the Owner Trustee title to the Replacement Airframe or Replacement
Engine to be received as consideration for the Airframe or Engine to be
released, (ii) assigning to the Owner Trustee the benefit of all manufacturer's
and vendor's warranties generally available with respect to such Replacement
Airframe or Replacement Engine (if any) (which warranties may be assigned by
the Owner Trustee to Lessee pursuant to Section 5(d) of the Lease), and (iii)
subjecting such Replacement Airframe or Replacement Engine to the Lien of this
Indenture and subjecting to any relevant Assigned Sublease and Sublease
Assignment, including, without limitation, an Indenture Supplement.
(4) With respect to a Replacement Airframe, a certificate from BK
Associates, Avmark Services Ltd., AeroEconomics, Inc. or another firm of
independent aircraft appraisers satisfactory to the Indenture Trustee
confirming the accuracy of the information set forth in Section 5.06(a)2.A(vii)
hereof.
(5) The opinion of counsel to the Lessee, satisfactory to the Indenture
Trustee, stating that:
(i) the certificates, opinions and other instruments and/or property
that have been or are therewith delivered to and deposited with the
Indenture Trustee conform to the requirements of this Indenture and the
Lease and, upon the basis of such application, the property so sold or
disposed of may be properly released from the Lien of this Indenture and
all conditions precedent herein provided for relating to such release
have been complied with;
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(ii) the Replacement Airframe and/or Replacement Engine(s) have
been validly subjected to the Lien of this Indenture and covered by the
Lease, the instruments subjecting such Replacement Airframe or
Replacement Engine to the Lien of this Indenture and the Lease, and
subjecting to any relevant Assigned Sublease and Sublease Assignment, as
the case may be, have been duly filed for recordation pursuant to the
Federal Aviation Act or any other law then applicable to the registration
of the Aircraft, and no further action, filing or recording of any
document is necessary in order to establish and perfect, in the United
States and, if the Aircraft is registered outside the United States, in
the jurisdiction of registration, the legal title to such Replacement
Airframe and the Lien of this Indenture on such Replacement Airframe
and/or Replacement Engine; and
(iii) the Owner Trustee and the Indenture Trustee (as assignee of
the Owner Trustee's rights under the Lease) shall be entitled to the
benefits and protections of Section 1110 of the Bankruptcy Code with
respect to the Replacement Airframe and, if an Event of Loss with respect
to the Aircraft has occurred, the Replacement Engines.
(b) Upon the acquisition by the Owner Trustee of title to or other
interest in any Part under and as provided in the Lease, the same shall
automatically and without further act become subject to the Lien of this
Indenture, and to the extent the Owner Trustee is divested of title to or other
interest in any Part under and as provided in the Lease, the same shall
automatically and without further act cease to be subject to the Lien of this
Indenture. The Indenture Trustee shall at any time and from time to time at
the request of the Lessee execute an appropriate written instrument or
instruments to confirm the release of any Part from the Lien of this Indenture
as provided in this Section 5.06(b), but only upon receipt by the Indenture
Trustee of an Officers' Certificate of Lessee confirming such release is
authorized by the terms hereof.
SECTION 5.07. Indenture Supplements for Replacements. In the event of
the substitution of a Replacement Airframe or Engine as contemplated by Section
11 of the Lease, the Owner Trustee and the Indenture Trustee agree for the
benefit of the Note Holders and the Lessee, subject to fulfillment of the
conditions precedent and compliance by the Lessee with its obligations set
forth in Section 11 of the Lease, to execute and deliver the appropriate
instruments as contemplated by Section 5.06 hereof, and execute and deliver to
the Lessee (or any relevant Permitted Sublessee) an appropriate instrument
releasing
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the Airframe and/or Engine(s) being replaced from the Lien of this Indenture.
SECTION 5.08. Effect of Replacement. In the event of the substitution of
a Replacement Airframe or Engine as contemplated by Section 11 of the Lease and
Section 5.06 hereof, all provisions of this Indenture relating to the Airframe
or Engine(s) being replaced shall be applicable to such Replacement Airframe or
Replacement Engine(s) with the same force and effect as if such Replacement
Airframe or Replacement Engine(s) were the same airframe or engine(s), as the
case may be, as the Airframe or Engine(s) being replaced.
SECTION 5.09. Notices, etc. Where this Indenture expressly provides for
notice to Note Holders, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first-class
postage prepaid, to each Note Holder entitled thereto, at his last address as it
appears in the Register. In any case where notice to Note Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Note Holder shall affect the sufficiency of such
notice with respect to other Note Holders. Where this Indenture provides for
notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Note
Holders shall be filed with the Indenture Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case, by reason of the suspension of or irregularities in regular mail
service, it shall be impracticable to mail notice to the Note Holders when such
notice is required to be given pursuant to any provision of this Indenture,
then any manner of giving such notice as shall be satisfactory to the Indenture
Trustee shall be deemed to be a sufficient giving of such notice.
SECTION 5.10. Certain Rights of Owner Trustee and Owner Participant.
Notwithstanding any other provisions of this Indenture, including the Granting
Clause, but subject always to the final paragraph of this Section 5.10, the
following rights shall be reserved to the Owner Trustee or Owner Participant,
as the case may be (as separate and independent rights) to the extent described
herein:
(a) the Owner Trustee or the Owner Participant may, without the
consent of the Indenture Trustee, demand,
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collect, xxx for or otherwise obtain all amounts included in Excepted
Payments from the Lessee, exercise any election or option or make any
decision or determination or give or receive any notice, consent, waiver
or approval in respect of any Excepted Payment and seek legal or equitable
remedies to require the Lessee to maintain the insurance coverage referred
to in Section 12 of the Lease (or the comparable provisions of any
Assigned Sublease) and such specific performance of the covenants of the
Lessee under the Lease (or the comparable provisions of any Assigned
Sublease) relating to the protection, maintenance, possession and use of
the Aircraft; provided, that the rights referred to in this clause (a)
shall not be deemed to include the exercise of any remedies provided for
in Section 18 of the Lease (or the comparable provisions of any Assigned
Sublease) other than the right to proceed by appropriate court action,
either at law or in equity, to enforce payment by the Lessee of such
amounts included in Excepted Payments or performance by the Lessee of such
insurance covenant or to recover damages for the breach thereof or for
specific performance of any covenant of the Lessee;
(b) unless an Indenture Event of Default and an Indenture Trustee
Event shall have occurred and be continuing, the Indenture Trustee shall
not, without the consent of the Owner Trustee, which consent shall not be
withheld if no right or interest of the Owner Trustee or the Owner
Participant shall be materially diminished or impaired thereby, (i) enter
into, execute and deliver amendments, modifications, waivers or consents
in respect of any of the provisions of the Lease, any Assigned Sublease
or any Sublease Assignment, or (ii) approve any accountants, engineers,
appraisers or counsel as satisfactory to render services for or issue
opinions to the Owner Trustee pursuant to the Operative Documents;
provided that, whether or not an Indenture Event of Default has occurred
and is continuing, the Owner Trustee's consent shall be required with
respect to any amendments, modifications, waivers or consents in respect
of any of the provisions of Sections 6, 12 or 16 of the Lease, or of any
other Section of the Lease to the extent such action shall affect (y) the
amount or timing of, or the right to enforce payment of any Excepted
Payment or (z) the amount or timing of any amounts payable by the Lessee
under the Lease as originally executed (or as subsequently modified with
the consent of the Owner Trustee) which, absent the occurrence and
continuance of an Indenture Event of Default hereunder, would be
distributable to the Owner Trustee under Article III hereof;
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(c) at all times whether or not an Indenture Event of Default has
occurred and is continuing, the Owner Trustee and the Owner Participant
shall have the right, together with the Indenture Trustee, (i) to receive
from the Lessee or any Permitted Sublessee all notices, certificates,
reports, filings, opinions of counsel and other documents and all
information which any thereof is permitted or required to give or furnish
to the Owner Trustee pursuant to any Operative Document (including
pursuant to Section 10 of the Lease), (ii) to exercise inspection rights
pursuant to Section 7 of the Lease, (iii) to retain all rights with
respect to insurance maintained for its own account which Section 12 of
the Lease specifically confers on the Owner Participant and (iv) to
exercise, to the extent necessary to enable it to exercise its rights
under Section 4.03 hereof, the rights of the Owner Trustee under Section
21(d) of the Lease and to give notices of default under Section 17 of the
Lease; and
(d) except as expressly provided to the contrary in clauses (a),
(b) and (c) above, so long as no Indenture Event of Default has occurred
and is continuing, all rights (including options, elections,
determinations, consents, approvals, waivers and the giving of notices)
of the Owner Trustee and the Owner Participant under the Lease shall be
exercised by the Owner Trustee and/or the Owner Participant, as the case
may be, to the exclusion of the Indenture Trustee and any Note Holder and
without the consent of the Indenture Trustee or any Note Holder; provided
that the foregoing shall not, nor shall any other provision of this
Section 5.10, limit (A) any rights separately and expressly granted to
the Indenture Trustee or any Note Holder under the Lease or the other
Operative Documents (including, without limitation, Section 15 of the
Refunding Agreement) or (B) the right of the Indenture Trustee or any
Note Holder to receive any funds to be delivered to the Owner Trustee
under the Lease (except with respect to Excepted Payments).
Notwithstanding the foregoing provisions of this Section 5.10, but subject
always to Section 10.05 hereof and to the rights of the Owner Participant under
Sections 2.12 and 4.03 hereof, the Indenture Trustee shall at all times have
the right, to the exclusion of the Owner Trustee and the Owner Participant, to
(A) demand, collect, xxx for or otherwise receive and enforce the payment of
all Rent due and payable under the Lease (other than any thereof constituting
an Excepted Payment), (B) declare the Lease to be in default under Section 18
thereof and (C) subject only to the provisions of Sections 4.03 and 4.04(a)
hereof,
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exercise the remedies set forth in such Section 18 (other than in connection
with Excepted Payments) and in Article IV hereof.
SECTION 5.11. Evidence of Action Taken by Note Holder. Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Note Holders may be embodied
in and evidenced by one or more instruments of substantially similar tenor
signed by such Note Holders in person or by agent duly appointed in writing,
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Indenture
Trustee and, if expressly required herein, to the Owner Trustee. Proof of
execution of any instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and (subject to Sections 5.04,
5.05, 6.02 and 6.05) conclusive in favor of the Indenture Trustee and the Owner
Trustee if made in the manner provided in this Indenture.
SECTION 5.12. Right of Revocation of Action Taken. At any time prior to
(but not after) the evidencing to the Indenture Trustee, as provided in Section
5.11 hereof, of the taking of any action by the Note Holders of the percentage
in aggregate Principal Amount of the Equipment Notes specified in this
Indenture in connection with such action, any Note Holder which has consented
to such action may, by filing written notice at the Corporate Trust Office and
upon proof of holding an Equipment Note, revoke such action so far as concerns
such Equipment Note. Except as aforesaid any such action taken by the Note
Holder shall be conclusive and binding upon such Note Holder and upon all
future Note Holders and owners of such Equipment Note and of any Equipment
Notes issued in exchange or substitution therefor, irrespective of whether or
not any notation in regard thereto is made upon any such Equipment Note. Any
action taken by the Note Holders of the percentage in aggregate Principal
Amount of the Equipment Notes specified in this Indenture in connection with
such action shall be conclusively binding upon the Owner Trustee, the Indenture
Trustee and the Note Holders.
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties. The Indenture Trustee in
its individual capacity accepts the trust hereby created and agrees to perform
the same but only upon the terms of this Indenture. The Indenture Trustee
agrees for the benefit of the Note Holders, the Owner Trustee and the Owner
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Participant to receive and disburse all moneys constituting part of the Trust
Indenture Estate in accordance with the terms hereof; and neither the Trust
Company nor the Indenture Trustee shall be answerable or accountable under any
circumstances, except for their own willful misconduct or gross negligence
(other than for the handling of funds, for which the standard of accountability
shall be negligence), or as provided in the fourth sentence of Section 2.04(a)
hereof and in the last sentence of Section 5.04 hereof, and except for
liabilities that may result, in the case of the Trust Company, from the
inaccuracy of any representation or warranty of the Trust Company in the
Refunding Agreement or in the Trust Agreement or in Section 6.03 hereof or the
failure to perform any covenant of the Trust Company pursuant to Section
4.01(a) hereof or in the Trust Agreement, the Refunding Agreement, or, in the
case of the Indenture Trustee, from the inaccuracy of any representation or
warranty, or failure to perform any covenant, of the Indenture Trustee made in
its individual capacity herein, in the Refunding Agreement or in any other
document. None of the Owner Participant, the Trust Company or the Indenture
Trustee shall be liable for any action or inaction of any other one of such
parties, except, in the case of the Owner Participant, for any action or
omission of the Owner Trustee performed or omitted on the instructions of the
Owner Participant. The Owner Trustee shall not be deemed a trustee for the
Note Holders for any purpose.
SECTION 6.02. Absence of Duties. In the case of the Indenture Trustee,
except in accordance with written instructions furnished pursuant to Section
5.01, 5.02 or 9.01 hereof, and except as provided in, and without limiting the
generality of, Sections 5.03, 5.04 and 6.09 hereof and, in the case of the Owner
Trustee, except as provided in Section 4.01(b), 6.09 or 9.01 hereof and in the
Trust Agreement, the Lease and the Refunding Agreement, the Owner Trustee and
the Indenture Trustee shall have no duty (i) to see to any registration of the
Aircraft or any recording or filing of the Lease or of this Indenture or any
other document, or to see to the maintenance of any such registration, recording
or filing, (ii) to see to any insurance on the Aircraft, whether or not the
Lessee shall be in default with respect thereto, (iii) to see to the payment or
discharge of any Lien of any kind against any part of the Trust Estate or the
Trust Indenture Estate, (iv) to confirm, verify or inquire into the failure to
receive any financial statements of the Lessee or (v) to inspect the Aircraft at
any time or ascertain or inquire as to the performance or observance of any of
the Lessee's covenants under the Lease or any of the Permitted Sublessee's
covenants under any Assigned Sublease with respect to the Aircraft.
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SECTION 6.03. No Representations or Warranties as to Aircraft or
Documents. NEITHER THE INDENTURE TRUSTEE (INDIVIDUALLY OR AS INDENTURE
TRUSTEE) NOR THE OWNER TRUSTEE NOR THE TRUST COMPANY MAKES OR SHALL BE DEEMED
TO HAVE MADE, AND EACH HEREBY EXPRESSLY DISCLAIMS, ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS, VALUE,
WORKMANSHIP, COMPLIANCE WITH SPECIFICATIONS, CONDITION, DESIGN, QUALITY,
DURABILITY, OPERATION, MERCHANTABILITY OR FITNESS FOR USE OR PURPOSE OF THE
AIRCRAFT OR ANY ENGINE OR ANY PART THEREOF, AS TO THE ABSENCE OF LATENT OR
OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY
INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF
OBLIGATIONS BASED ON STRICT LIABILITY IN TORT, OR ANY OTHER REPRESENTATION OR
WARRANTY WITH RESPECT TO THE AIRCRAFT OR ANY ENGINE, except that the Trust
Company warrants that (i) on the Delivery Date for the Aircraft the Owner
Trustee shall have received whatever interest in the Aircraft was conveyed to
it under the Second Aircraft Warranty Xxxx of Sale subject to the rights of the
parties to the Indenture Documents and (ii) the Aircraft shall be free and
clear of Lessor's Liens attributable to the Trust Company. Neither the Trust
Company nor the Indenture Trustee makes or shall be deemed to have made any
representation or warranty as to the validity, legality or enforceability of
this Indenture, the Trust Agreement, the Equipment Notes or any Indenture
Documents or as to the correctness of any statement contained in any thereof,
except for the representations and warranties of the Trust Company and the
Indenture Trustee in its individual capacity or as Indenture Trustee made under
this Indenture or in the other Operative Documents.
SECTION 6.04. No Segregation of Moneys; No Interest. Any moneys paid to
or retained by the Indenture Trustee pursuant to any provision hereof and not
then required to be distributed to any Note Holder, the Lessee or the Owner
Trustee as provided in Article III hereof need not be segregated in any manner
except to the extent required by law, and may be deposited under such general
conditions as may be prescribed by law, and the Indenture Trustee shall not
(except as otherwise provided in Section 3.07 hereof) be liable for any interest
thereon; provided that any payments received or applied hereunder by the
Indenture Trustee shall be accounted for by the Indenture Trustee so that any
portion thereof paid or applied pursuant hereto shall be identifiable as to the
source thereof.
SECTION 6.05. Reliance; Agents; Advice of Counsel. Neither the Owner
Trustee nor the Indenture Trustee shall incur any 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
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genuine and believed by it to be signed by the proper party or parties. The
Owner Trustee and the Indenture Trustee may accept a copy of a resolution of the
Board of Directors of any party to the Refunding Agreement, certified by the
Secretary or an Assistant Secretary thereof as duly adopted and in full force
and effect, as conclusive evidence that such resolution has been duly adopted
and that the same is in full force and effect. As to the aggregate unpaid
Principal Amount of Equipment Notes outstanding as of any date, the Owner
Trustee may for all purposes hereof rely on a certificate signed by any Vice
President or other authorized corporate trust officer of the Indenture Trustee.
As to any fact or matter relating to the Lessee the manner of ascertainment of
which is not specifically described herein, the Owner Trustee and the Indenture
Trustee may for all purposes hereof rely on a certificate, signed by a duly
authorized officer of the Lessee, as to such fact or matter, and such
certificate shall constitute full protection to the Owner Trustee and the
Indenture Trustee for any action taken or omitted to be taken by them in good
faith in reliance thereon, but in the case of any such certificate, the Owner
Trustee and the Indenture Trustee shall be under a duty to examine the same to
determine whether or not it conforms to the requirements of this Indenture. The
Indenture Trustee shall assume, and shall be fully protected in assuming, that
the Owner Trustee is authorized by the Trust Agreement to enter into this
Indenture and to take all action to be taken by it pursuant to the provisions
hereof, and shall not inquire into the authorization of the Owner Trustee with
respect thereto. In the administration of the trusts hereunder, the Owner
Trustee and the Indenture Trustee each may execute any of the trusts or powers
hereof and perform its powers and duties hereunder directly or through agents or
attorneys and shall not be responsible for any misconduct or negligence on the
part of any such agent or attorney appointed with due care hereunder. The
Indenture Trustee may, at the expense of the Trust Indenture Estate, consult
with counsel, accountants and other skilled Persons to be selected and retained
by it, and the Owner Trustee and the Indenture Trustee shall not be liable for
anything done, suffered or omitted in good faith by them in accordance with the
written advice or written opinion of any such counsel, accountants or other
skilled Persons.
SECTION 6.06. Capacity in Which Acting. The Owner Trustee acts hereunder
solely as trustee under the Trust Agreement provided, and not in its individual
capacity, except as otherwise expressly provided herein.
SECTION 6.07. Compensation. The Indenture Trustee shall be entitled to
reasonable compensation (which compensation shall not (to the extent permitted
by applicable law) be limited
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by any provision of law in regard to the compensation of a trustee of an express
trust), including expenses, advances and disbursements, for all services
rendered hereunder, and shall have a first priority claim (prior to the Note
Holders) on the Trust Indenture Estate for the payment of such compensation, to
the extent that such compensation shall not be paid by the Lessee, and shall
have the right to use or apply any moneys held by it hereunder in the Trust
Indenture Estate toward such payments. The Indenture Trustee agrees that it
shall have no right against any Note Holder or the Owner Participant for any fee
as compensation for its services as trustee under this Indenture.
SECTION 6.08. May Become Note Holder. Each of the institutions acting as
Owner Trustee and Indenture Trustee hereunder may become a Note Holder and have
all rights and benefits of a Note Holder to the same extent as if it were not
the institution acting as Owner Trustee or Indenture Trustee, as the case may
be.
SECTION 6.09. Further Assurances; Financing Statements. At any time and
from time to time, upon the request of the Indenture Trustee, the Owner Trustee
shall promptly and duly execute and deliver any and all such further instruments
and documents as may be specified in such request and as are necessary or
desirable to perfect, preserve or protect the mortgage, security interests and
assignments created or intended to be created hereby, or to obtain for the
Indenture Trustee the full benefit of the specific rights and powers herein
granted, including, without limitation, the execution and delivery of Uniform
Commercial Code financing statements and continuation statements with respect
thereto, or similar instruments relating to the perfection of the mortgage,
security interests or assignments created or intended to be created hereby.
ARTICLE VII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification. The Owner Trustee, not
individually but solely in its capacity as owner trustee under the Trust
Agreement, hereby agrees, whether or not any of the transactions contemplated
hereby shall be consummated but except as otherwise provided in Section 2.03
hereof, to assume liability for, and does hereby indemnify, protect, save and
keep harmless the Indenture Trustee, in its individual capacity and as
Indenture Trustee, and its successors, permitted assigns, agents and servants
solely from the Trust Estate, from
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and against any and all liabilities, obligations, losses, damages, penalties,
taxes (excluding any taxes payable by the Indenture Trustee on or measured by
any compensation received by the Indenture Trustee for its services under this
Indenture), claims, actions, suits, and reasonable out-of-pocket costs, expenses
or disbursements (including reasonable legal fees and expenses) of any kind and
nature whatsoever which may be imposed on, incurred by or asserted against the
Indenture Trustee from and after the Restatement Date (whether or not also
agreed to be indemnified against by any other Person under any other document)
in any way relating to or arising out of this Indenture, the Trust Agreement,
the Equipment Notes, the other Indenture Documents or the enforcement of any of
the terms of any thereof, or in any way relating to or arising out of the
manufacture, purchase, acceptance, nonacceptance, rejection, ownership,
delivery, lease, sublease, possession, use, operation, condition, sale, return
or other disposition of the Aircraft or any Engine (including, without
limitation, latent and other defects, whether or not discoverable, and any claim
for patent, trademark or copyright infringement), or in any way relating to or
arising out of the administration of the Trust Indenture Estate or the action or
inaction of the Indenture Trustee hereunder, except only (i) in the case of
willful misconduct or gross negligence (or negligence in the case of handling of
funds) of the Indenture Trustee in the performance of its duties hereunder, (ii)
as may result from the inaccuracy of any representation or warranty of the
Indenture Trustee made in the Refunding Agreement, (iii) as otherwise provided
in Section 2.04(a) hereof or in the last sentence of Section 5.04 hereof or (iv)
as otherwise excluded by the terms of Sections 10(b) and 13 of the Lease from
the Lessee's indemnities to the Indenture Trustee, in its individual capacity
and as Indenture Trustee, and its successors, permitted assigns, agents and
servants, thereunder; provided that so long as the Lease is in effect, the
Indenture Trustee shall not make any claim under this Section 7.01 for any
amount indemnified against by the Lessee under the Lease without first (but only
to the extent not stayed or otherwise prevented by operation of law) making
demand on the Lessee for payment of such amount. The Indenture Trustee shall
notify the Owner Trustee and the Lessee promptly of any claim for which it may
seek indemnity. The Lessee shall be entitled to defend any claim by the
Indenture Trustee to the extent provided in Section 10 or 13 of the Lease. The
Indenture Trustee shall be entitled to indemnification from the Trust Indenture
Estate for any liability, obligation, loss, damage, penalty, claim, action,
suit, cost, expense or disbursement indemnified against pursuant to this Section
7.01 to the extent not reimbursed by the Lessee or others, but without releasing
any of them from their respective agreements of reimbursement; and to secure the
same the Indenture Trustee shall
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have a prior Lien on the Trust Indenture Estate. The indemnities contained in
this Section 7.01 shall survive the termination of this Indenture.
SECTION 7.02. Exculpation and Release of Liability. Without in any way
affecting the limitations on liability set forth in the Operative Documents,
the Indenture Trustee, and each Note Holder by accepting any Equipment Note
hereunder, hereby acknowledge and agree that none of the Trust Company, the
Owner Participant or any director, officer, employee, stockholder, agent or
affiliate of the Trust Company or the Owner Participant (the "Exculpated Equity
Persons") shall have any obligation, duty or liability of any kind whatsoever
to the Indenture Trustee or any such Note Holder in connection with the
exercise by any Exculpated Equity Person of any rights of the Owner Trustee or
the taking of any action or the failure to take any action by any Exculpated
Equity Person in connection with any rights of the Owner Trustee under this
Indenture or the Lease, and each such Note Holder hereby waives and releases,
to the extent permitted by applicable law, each Exculpated Equity Person of any
and all such obligations, duties or liabilities.
ARTICLE VIII
SUCCESSOR TRUSTEES AND SEPARATE TRUSTEES
SECTION 8.01. Notice of Successor Owner Trustee. In the case of any
appointment of a successor to the Owner Trustee pursuant to the Trust Agreement
or any merger, conversion, consolidation or sale of substantially all of the
corporate trust business of the Trust Company pursuant to the Trust Agreement,
the successor Owner Trustee shall give prompt written notice thereof to the
Indenture Trustee and to each Note Holder.
SECTION 8.02. Resignation and Removal of Indenture Trustee; Appointment
of Successor. (a) The Indenture Trustee or any successor thereto may resign at
any time without cause by giving at least 30 calendar days' prior written
notice to the Owner Trustee, the Owner Participant, each Note Holder and the
Lessee, such resignation to be effective upon the acceptance of the trusteeship
by a successor Indenture Trustee. In addition, a Majority in Interest of Note
Holders may at any time remove the Indenture Trustee without cause by an
instrument in writing delivered to the Owner Trustee, the Lessee and the
Indenture Trustee, and the Indenture Trustee shall promptly notify each Note
Holder thereof in writing, such removal to be effective upon the acceptance of
the trusteeship by a successor Indenture Trustee. In the case of the
resignation or removal of the
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Indenture Trustee, a Majority in Interest of Note Holders may appoint, with the
consent of the Lessee, a successor Indenture Trustee by an instrument signed by
such Holders (whose fees shall be reasonably acceptable to the Lessee). If a
successor Indenture Trustee shall not have been appointed within 30 calendar
days after such notice of resignation or removal, the Indenture Trustee, any
Note Holder, the Owner Trustee, the Lessee or the Owner Participant may apply to
any court of competent jurisdiction to appoint a successor Indenture Trustee to
act until such time, if any, as a successor shall have been appointed as above
provided. The successor Indenture Trustee so appointed by such court shall
immediately and without further act be superseded by any successor Indenture
Trustee appointed as above provided within one year from the date of the
appointment by such court.
(b) Any successor Indenture Trustee, however appointed, shall execute and
deliver to the Owner Trustee and to the predecessor Indenture Trustee an
instrument accepting and assuming such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Indenture Trustee, without further act, shall become vested with and
bound by all the estates, properties, rights, powers, duties and obligations of
the predecessor Indenture Trustee hereunder and under the other Indenture
Documents in the trusts hereunder applicable to it with like effect as if
originally named the Indenture Trustee herein; but nevertheless upon the written
request of such successor Indenture Trustee, such predecessor Indenture Trustee
shall execute and deliver an instrument transferring to such successor Indenture
Trustee, upon the trusts herein expressed applicable to it, all the estates,
properties, rights and powers of such predecessor Indenture Trustee, and such
predecessor Indenture Trustee shall duly assign, transfer, deliver and pay over
to such successor Indenture Trustee all moneys or other property then held by
such predecessor Indenture Trustee hereunder, subject nevertheless to its claim
provided for in Section 6.07 hereof.
(c) Any successor Indenture Trustee, however appointed, shall be a
"citizen of the United States" within the meaning of Section 40102(a)(15) of
the Federal Aviation Act and shall also be a bank or trust company having a
combined capital and surplus of at least $200,000,000 if there be such an
institution willing, able and legally qualified to perform the duties of the
Indenture Trustee hereunder upon reasonable or customary terms.
(d) Any corporation into which the Indenture Trustee may be merged or
converted or with which it may be consolidated,
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or any corporation resulting from any merger, conversion or consolidation to
which the Indenture Trustee shall be a party, or any corporation to which
substantially all the corporate trust business of the Indenture Trustee may be
transferred, shall, subject to the terms of paragraph (c) of this Section 8.02,
be the Indenture Trustee under this Indenture without further act.
Notwithstanding the foregoing, upon the request of the Owner Trustee or the
Lessee, any such successor corporation referred to in this Section 8.02(d) shall
deliver to the Owner Trustee and the Lessee an instrument confirming its status
as the Indenture Trustee hereunder and under the other Indenture Documents.
SECTION 8.03. Appointment of Separate Trustees. (a) At any time or
times, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust Indenture Estate may at the time be located or in
which any action of the Indenture Trustee may be required to be performed or
taken, the Indenture Trustee, by an instrument in writing signed by it, may
appoint one or more individuals or corporations to act as separate trustee or
separate trustees or co-trustee, acting jointly with the Indenture Trustee, of
all or any part of the Trust Indenture Estate to the full extent that local law
makes it necessary for such separate trustee or separate trustees or co-trustee
acting jointly with the Indenture Trustee to act.
(b) The Indenture Trustee and, at the request of the Indenture Trustee, the
Owner Trustee, shall execute, acknowledge and deliver all such instruments as
may be required by the legal requirements of any jurisdiction or by any such
separate trustee or separate trustees or co-trustee for the purpose of more
fully confirming such title, rights or duties to such separate trustee or
separate trustees or co-trustee. Upon the acceptance in writing of such
appointment by any such separate trustee or separate trustees or co-trustee, it,
he, she or they shall be vested with such title to the Trust Indenture Estate or
any part thereof, and with such rights and duties, as shall be specified in the
instrument of appointment, jointly with the Indenture Trustee (except insofar as
local law makes it necessary for any such separate trustee or separate trustees
to act alone) subject to all the terms of this Indenture. Any separate trustee
or separate trustees or co-trustee may, at any time by an instrument in writing,
constitute the Indenture Trustee its, his or her attorney-in-fact and agent with
full power and authority to do all acts and things and to exercise all
discretion on its, his or her behalf and in its, his or her name. In case any
such separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, the title to the Trust Indenture Estate and all assets,
property, rights, powers, trusts, obligations and duties of such separate
trustee or co-trustee
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shall, so far as permitted by law, vest in and be exercised by the
Indenture Trustee, without the appointment of a successor to such separate
trustee or co-trustee unless and until a successor is appointed.
(c) All provisions of this Indenture which are for the benefit of the
Indenture Trustee shall extend to and apply to each separate trustee or
co-trustee appointed pursuant to the foregoing provisions of this Section 8.03,
including without limitation Article VII hereof.
(d) Every additional trustee and separate trustee hereunder shall, to the
extent permitted by law, be appointed and act, and the Indenture Trustee shall
act, subject to the following provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon the
Indenture Trustee in respect of the receipt, custody, investment and
payment of moneys shall be exercised solely by the Indenture Trustee;
(ii) all other rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed and
exercised or performed by the Indenture Trustee and such additional
trustee or trustees and separate trustee or trustees jointly except to the
extent that under any law of any jurisdiction in which any particular act
or acts are to be performed, the Indenture Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the
Trust Indenture Estate in any such jurisdiction) shall be exercised and
performed by such additional trustee or trustees or separate trustee or
trustees;
(iii) no power hereby given to, or with respect to which it is
hereby provided may be exercised by, any such additional trustee or
separate trustee shall be exercised hereunder by such additional trustee
or separate trustee except jointly with, or with the consent of, the
Indenture Trustee; and
(iv) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder.
If at any time the Indenture Trustee shall deem it no longer necessary or
prudent in order to conform to any such law, the Indenture Trustee shall execute
and deliver an indenture
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supplemental hereto and all other instruments and agreements necessary or proper
to remove any additional trustee or separate trustee.
(e) Any request, approval or consent in writing by the Indenture Trustee
to any additional trustee or separate trustee shall be sufficient warrant to
such additional trustee or separate trustee, as the case may be, to take such
action as may be so requested, approved or consented to.
(f) Notwithstanding any other provision of this Section 8.03, the powers
of any additional trustee or separate trustee appointed pursuant to this
Section 8.03 shall not in any case exceed those of the Indenture Trustee
hereunder.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS TO THIS
INDENTURE AND OTHER DOCUMENTS
SECTION 9.01. Lease Amendments and Supplemental Indentures. (a) Except
as otherwise provided in Section 5.10 hereof, and except with respect to
Excepted Payments, the Owner Trustee agrees that it shall not enter into any
amendment of or supplement to the Lease, or execute and deliver any written
waiver or modification of, or consent under, the terms of the Lease, unless
such supplement, amendment, waiver, modification or consent is consented to in
writing by the Indenture Trustee acting on instructions of a Majority in
Interest of Note Holders. Anything to the contrary contained in this Section
9.01 notwithstanding, without the necessity of the consent of any of the Note
Holders or (as respects clauses (i) and (ii) below) the Indenture Trustee, (i)
any Excepted Payments payable to the Owner Trustee or Owner Participant may be
modified, amended, changed or waived in such manner as shall be agreed to by
the Owner Participant and Lessee, (ii) the Owner Trustee and Lessee may, so
long as no Indenture Event of Default has occurred and is continuing, enter
into amendments of or additions to the Lease to modify Sections 6(d), 9 and 16
and Exhibits B and E (except to the extent that such amendment would adversely
affect the rights or exercise of remedies under Section 18 of the Lease) so
long as such amendments, modifications and changes do not and would not (A)
affect the time of, or reduce the amount of, Basic Rent or Stipulated Loss
Value payments until after the payment in full of all Secured Obligations, (B)
impair the Lien of this Indenture, (C) adversely affect the value, utility or
useful life of the Aircraft or any Engine or (D) otherwise adversely affect the
Note Holders, and (iii) the Lessee may effect the re-registration of
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the Aircraft in accordance with but always subject to the terms and conditions
applicable thereto specified in Section 11 of the Refunding Agreement and
Section 6(e) of the Lease and the Indenture Trustee may approve any Permitted
Sublessee as provided in clause (c) of the definition of such term set forth in
the Lease and may exercise the rights of the Indenture Trustee under Section 15
of the Refunding Agreement. For the avoidance of doubt, nothing in this Section
9.01 shall limit in any way the rights of the Owner Trustee and/or the Owner
Participant under Section 5.10(d) to exercise certain rights and powers under
the Lease to the exclusion of the Indenture Trustee and any Note Holder and
without the consent of the Indenture Trustee or any Note Holder.
The Indenture Trustee is hereby authorized to join in the execution of any
supplemental indenture, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the conveyance,
transfer, assignment, mortgage or pledge of any property thereunder, but the
Indenture Trustee shall not be obligated to enter into any such supplemental
indenture which adversely affects the Indenture Trustee's own rights, duties or
immunities under this Indenture or otherwise, whether in its official or
individual capacity.
Any supplemental indenture authorized by the provisions of this Section
9.01 may be executed without the consent of the Note Holders notwithstanding
any of the provisions of this Section 9.01.
(b) Without limiting the provisions of Section 9.01(a) hereof and subject
to Sections 5.10(b) and 5.10(d) hereof, the Indenture Trustee agrees with the
Note Holders that it shall not enter into any amendment, waiver or modification
of, supplement or consent to this Indenture, the Lease, the Refunding Agreement
or the other Indenture Documents, or any other agreement included in the Trust
Indenture Estate, unless such supplement, amendment, waiver, modification or
consent is consented to in writing by a Majority in Interest of Note Holders,
or does not adversely affect the Note Holders in any material respect. Upon
the written request of a Majority in Interest of Note Holders, the Indenture
Trustee shall from time to time enter into any such supplement or amendment, or
execute and deliver any such waiver, modification or consent, as may be
specified in such request and as may be (in the case of any such amendment,
supplement or modification), to the extent such agreement is required, agreed
to by the Owner Trustee and Lessee or, as may be appropriate, the Manufacturer;
provided, however, that, without the consent of each Holder of an affected
Equipment Note then outstanding and of each Liquidity Provider, no such
amendment of or supplement to
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this Indenture, the Lease, the Refunding Agreement or any other Indenture
Document or waiver or modification of the terms of, or consent under, any
thereof, shall (i) modify any of the provisions of this Section 9.01, or of
Section 2.02, 2.10, 2.13, 4.02, 4.04(e), 5.06 or 5.10 hereof, Section 17 (except
to add a Lease Event of Default) of the Lease, the definitions of "Indenture
Event of Default", "Indenture Default", "Indenture Trustee Event", "Lease Event
of Default", "Lease Default", "Majority in Interest of Note Holders",
"Make-Whole Amount" or "Note Holder", or the percentage of Note Holders required
to take or approve any action hereunder, (ii) reduce the amount, or change the
time of payment or method of calculation of any amount, of Principal Amount,
Make-Whole Amount, if any, or interest with respect to any Equipment Note, or
alter or modify the provisions of Article III hereof with respect to the order
of priorities in which distribution thereunder shall be made as among the Note
Holders, the Owner Trustee and the Lessee, (iii) reduce, modify or amend any
indemnities in favor of the Note Holders, (iv) consent to any change in this
Indenture or the Lease which would permit redemption of Equipment Notes earlier
than permitted under Section 2.10 hereof, (v) modify any of the provisions of
Section 4(b) of the Lease, or modify, amend or supplement the Lease, any
Assigned Sublease or any Sublease Assignment, or consent to any assignment of
any thereof, in either case releasing the Lessee (or Permitted Sublessee) from
its obligations in respect of the payment of Basic Rent or Stipulated Loss Value
for the Aircraft or altering the absolute and unconditional character of the
obligations of Lessee to pay Rent as set forth in Sections 4(b) and 4(d) of the
Lease (or comparable provisions in any Assigned Sublease) or (vi) permit the
creation of any Lien on the Trust Indenture Estate or any part thereof other
than Permitted Liens or deprive any Note Holder of the benefit of the Lien of
this Indenture on the Trust Indenture Estate, except as provided in connection
with the exercise of remedies under Article IV hereof.
(c) At any time after the date of the consummation of the Refinancing
Transaction, the Owner Trustee and the Indenture Trustee may enter into one or
more agreements supplemental hereto without the consent of any Note Holder for
any of the following purposes: (i)(A) to cure any defect or inconsistency
herein or in the Equipment Notes, or to make any change not inconsistent with
the provisions hereof (provided that such change does not adversely affect the
interests of any Note Holder in its capacity solely as Note Holder) or (B) to
cure any ambiguity or correct any mistake; (ii) to evidence the succession of
another party as the Owner Trustee in accordance with the terms of the Trust
Agreement or to evidence the succession of a new trustee hereunder pursuant
hereto, the removal of the trustee hereunder or the appointment of any
co-trustee or co-trustees or any separate
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or additional trustee or trustees; (iii) to convey, transfer, assign, mortgage
or pledge any property to or with the Indenture Trustee or to make any other
provisions with respect to matters or questions arising hereunder so long as
such action shall not adversely affect the interests of the Note Holders in its
capacity solely as Note Holder or impose upon the Lessee any additional
indemnification obligations; (iv) to correct or amplify the description of any
property at any time subject to the Lien of this Indenture or better to assure,
convey and confirm unto the Indenture Trustee any property subject or required
to be subject to the Lien of this Indenture, the Airframe or Engines or any
Replacement Airframe or Replacement Engine; (v) to add to the covenants of the
Owner Trustee for the benefit of the Note Holders, or to surrender any rights or
powers herein conferred upon the Owner Trustee, the Owner Participant or the
Lessee; (vi) to add to the rights of the Note Holders; and (vii) to include on
the Equipment Notes any legend as may be required by law.
(d) So long as no Lease Event of Default has occurred and is continuing,
without the consent of the Lessee no amendment or supplement to this Indenture
or waiver or modification of the terms hereof shall adversely affect the Lessee
in any material respect or impose upon the Lessee any additional
indemnification obligations.
(e) So long as no Indenture Event of Default has occurred and is
continuing, the Indenture Trustee shall, except as expressly provided in
Section 5.10(d), not enter into any amendment or supplement to the Lease or
waiver or modification of the terms thereof.
SECTION 9.02. Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and
immunities under this Indenture of the Indenture Trustee, the Owner Trustee and
the Note Holders 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 indenture shall be and be
deemed to be part of the terms and conditions of this Indenture for all and any
purposes.
SECTION 9.03. Documents to Be Given to Trustee. The Indenture Trustee
shall be entitled to receive and shall be fully protected in relying upon an
Officers' Certificate and an Opinion of Counsel as conclusive evidence that any
supplemental indenture
Trust Indenture
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referred to in Section 9.01 complies with the applicable provisions of this
Indenture.
SECTION 9.04. Notation on Notes in Respect of Supplemental Indentures.
Equipment Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article IX may bear a
notation in form approved by the Indenture Trustee as to any matter provided for
by such supplemental indenture. If the Owner Trustee or the Indenture Trustee
shall so determine, new Equipment Notes so modified as to conform, in the
opinion of the Owner Trustee and the Indenture Trustee, to any modification of
this Indenture contained in any such supplemental indenture may be prepared by
the Owner Trustee, authenticated by the Indenture Trustee and delivered in
exchange for the Equipment Notes then outstanding.
SECTION 9.05. Trustees Protected. If, in the opinion of the institution
acting as Owner Trustee under the Trust Agreement or the institution acting as
Indenture Trustee hereunder, any document required to be executed by it
pursuant to the terms of this Article IX affects adversely any right, duty,
immunity or indemnity with respect to such institution under this Indenture,
such institution may in its discretion decline to execute such document.
SECTION 9.06. Documents Mailed to Note Holders. Promptly after the
execution by the Owner Trustee or the Indenture Trustee of any document entered
into pursuant to this Article IX, the Owner Trustee shall mail, by certified
mail, postage prepaid, conformed copies thereof to the Indenture Trustee (in
such quantities as will permit the Indenture Trustee to distribute one copy to
each Note Holder, and the Indenture Trustee shall mail one such copy to each
Note Holder), but the failure of the Owner Trustee or the Indenture Trustee to
mail such conformed copies shall not impair or affect the validity of such
document. The Indenture Trustee will furnish to each Note Holder, promptly
upon receipt thereof, duplicates or copies of all reports, notices, requests,
demands, certificates and other instruments furnished to the Indenture Trustee
under the Lease or hereunder to the extent that the same were not required to
have been furnished to such Note Holder pursuant hereto or to the Lease.
SECTION 9.07. No Request Necessary for Lease Supplement or Indenture
Supplement. Notwithstanding anything contained in this Article IX, no written
request or consent of the Indenture Trustee, any Note Holder or the Owner
Participant pursuant to this Article IX shall be required to enable the
Owner
Trust Indenture
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Trustee to enter into any Lease Supplement with the Lessee pursuant to the
terms of the Lease to subject the Aircraft, any Engines or other property
thereto or to release the Aircraft, any Engine or other property therefrom or
to execute and deliver an Indenture Supplement, in each case
pursuant to the terms hereof.
SECTION 9.08. Notices to Liquidity Provider. Any request made to any
Note Holder for consent to any amendment or supplement pursuant to this Article
IX shall be promptly furnished by the Indenture Trustee to each Liquidity
Provider.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Indenture. Upon payment in full of the
Principal Amount of, Make-Whole Amount, if any, and all accrued and unpaid
interest on and other amounts then due with respect to the Equipment Notes and
provided that there shall then be no other amounts then due to the Note Holders
and the Indenture Trustee hereunder or under the Lease or the Refunding
Agreement or otherwise secured hereby, the Lien of this Indenture shall be
deemed discharged and the security interests in favor of the Indenture Trustee
and the Note Holders hereunder shall terminate, and the Owner Trustee shall
direct the Indenture Trustee to execute and deliver to or as directed in
writing by the Owner Trustee, an appropriate instrument evidencing the
discharge of such Lien and the termination of such security interest in the
Aircraft and release of the Indenture Documents from the assignment and pledge
thereof hereunder, and the Indenture Trustee shall execute and deliver such
instrument as aforesaid and, at the Owner Trustee's expense, will execute and
deliver such other instruments or documents as may be reasonably requested by
the Owner Trustee to give effect to such discharge, termination and release;
provided, however, that this Indenture and the trusts created hereby shall
earlier terminate and this Indenture shall be of no further force or effect as
expressly provided pursuant to Article X hereof or upon any sale or other final
disposition by the Indenture Trustee of all property part of the Trust
Indenture Estate and the final distribution by the Indenture Trustee of all
moneys or other property or proceeds constituting part of the Trust Indenture
Estate in accordance with the terms hereof. Except as aforesaid otherwise
provided, this Indenture and the trusts created hereby shall continue in full
force and effect in accordance with the terms hereof.
SECTION 10.02. No Legal Title to Trust Indenture Estate in Note Holders.
No Note Holder shall have legal title to
Trust Indenture
97
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any part of the Trust Indenture Estate. No transfer, by operation of law or
otherwise, of any Equipment Note or other right, title and interest of any Note
Holder in and to the Trust Indenture Estate or hereunder shall operate to
terminate this Indenture or entitle such Note Holder or any successor or
transferee of such Holder to an accounting or to the transfer to it of legal
title to any part of the Trust Indenture Estate.
SECTION 10.03. Sale of Aircraft by Indenture Trustee is Binding. Any
sale or other conveyance of the Aircraft by the Indenture Trustee made pursuant
to the terms of this Indenture or of the Lease shall bind the Note Holders and
shall be effective to transfer or convey all right, title and interest of the
Indenture Trustee, the Owner Trustee, the Owner Participant and such Holders in
and to the Aircraft. No purchaser or other grantee shall be required to
inquire as to the authorization, necessity, expediency or regularity of such
sale or conveyance or as to the application of any sale or other proceeds with
respect thereto by the Indenture Trustee.
SECTION 10.04. Indenture for Benefit of Owner Trustee, Indenture Trustee,
Owner Participant, Lessee and Note Holders. Nothing in this Indenture, whether
express or implied, shall be construed to give to any Person other than the
Owner Trustee, the Indenture Trustee, the Owner Participant, the Note Holders,
the Lessee and, with respect to any provisions hereof requiring payment to any
Permitted Sublessee, such Permitted Sublessee, any legal or equitable right,
remedy or claim under or in respect of this Indenture.
SECTION 10.05. No Action Contrary to Lessee's Rights Under the Lease.
Notwithstanding any of the provisions of this Indenture or the Trust Agreement
to the contrary, each of the Note Holders, the Indenture Trustee and the Owner
Trustee agrees for the benefit of the Lessee that it will not take any action
contrary to the Lessee's rights under the Lease, including the right of the
Lessee to possession and use and quiet enjoyment of the Aircraft, except in
accordance with the provisions of the Lease.
SECTION 10.06. Notices. Unless otherwise expressly specified herein,
all notices, requests, demands, authorizations, directions, consents, waivers
or documents required or permitted by the terms of this Indenture shall be in
English and in writing, mailed by first-class registered or certified mail,
postage prepaid, or by confirmed telex or telecopy, and (i) if to the Owner
Trustee, addressed to it at its office at Xxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, Attention: Corporate Trust Administration Department (telex:
835437; answerback: WILMTR;
Trust Indenture
98
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telecopy: (000) 000-0000/8882), with a copy to the Owner Participant at its
address set forth in the Refunding Agreement, (ii) if to the Indenture Trustee,
addressed to it at its office at 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Corporate Trust Department (telecopy: (000) 000-0000) or
(iii) if to the Owner Participant, the Lessee or any Note Holder, addressed to
such party at such address as such party shall have furnished by notice to the
Owner Trustee and the Indenture Trustee, or, until an address is so furnished,
addressed to the address of such party (if any) set forth on the signature pages
to the Refunding Agreement or in the Register. Whenever any notice in writing
is required to be given by the Owner Trustee or the Indenture Trustee or any
Note Holder to any of the other of them, such notice shall be deemed 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 Indenture.
SECTION 10.07. Severability. Any provision of this Indenture 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 10.08. No Oral Modifications or Continuing Waivers. No terms or
provisions of this Indenture or the Equipment Notes 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 waiver of the terms hereof or of
any Equipment Note shall be effective only in the specific instance and for the
specific purpose given.
SECTION 10.09. 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 permitted assigns of each, all as herein
provided. Any request, notice, direction, consent, waiver or other instrument
or action by any Note Holder shall bind the successors and assigns of such Note
Holder. This Indenture and the Trust Indenture Estate shall not be affected by
any amendment or supplement to the Trust Agreement or by any other action taken
under or in respect of the Trust Agreement, except that each reference in this
Indenture to the Trust Agreement shall mean the Trust Agreement as amended and
supplemented from time to time to
Trust Indenture
99
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the extent permitted hereby and thereby. Each Note Holder by its acceptance of
an Equipment Note agrees to be bound by this Indenture and all provisions of the
Refunding Agreement applicable to a Note Holder.
SECTION 10.10. Headings. The headings of the various Articles and
Sections herein and in the table of contents hereto are for the convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
SECTION 10.11. Normal Commercial Relations. Anything contained in this
Indenture to the contrary notwithstanding, the Indenture Trustee, the Owner
Trustee, the Owner Participant, any Note Holder or any bank or other Affiliate
of any of them may conduct any banking or other financial transactions, and
have banking or other commercial relationships, with the Lessee or any
Permitted Sublessee fully to the same extent as if this Indenture were not in
effect, including without limitation the making of loans or other extensions of
credit to the Lessee for any purpose whatsoever, whether related to any of the
transactions contemplated hereby or otherwise.
SECTION 10.12. Governing Law; Counterpart Form. THIS INDENTURE AND THE
EQUIPMENT NOTES ISSUED HEREUNDER 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. This Indenture may be
executed by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 10.13. Section 1110. It is the intention of the parties that the
Owner Trustee, as lessor under the Lease (and the Indenture Trustee as assignee
of the Owner Trustee's rights hereunder), shall be entitled to the benefits of
Section 1110 of the Bankruptcy Code with respect to the right to take possession
of the Aircraft, Airframe, Engines and Parts as provided in the Lease in the
event of a case under Chapter 11 of the Bankruptcy Code in which Lessee is a
debtor, and in any instance where more than one construction is possible of the
terms and conditions hereof or of any other pertinent Operative Document, each
such party agrees that a construction which would preserve such benefits shall
control over any construction which would not preserve such benefits.
Trust Indenture
100
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture, as
amended and restated, to be duly executed by their respective officers
thereunto duly authorized, as of the day and year first above written, and
acknowledge that this Indenture has been made and delivered in The City of New
York.
WILMINGTON TRUST COMPANY, not in its
individual capacity, except as
expressly provided herein, but solely
as Owner Trustee
By: _________________________________
Name:
Title:
THE CHASE MANHATTAN BANK, not in its
individual capacity, except as
expressly provided herein, but solely
as Indenture Trustee
By: _________________________________
Name:
Title:
Trust Indenture
101
EXHIBIT A
TO
SECOND AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-10]
TRUST INDENTURE SUPPLEMENT NO. _____
[GPA 1989 BN-10]
TRUST INDENTURE SUPPLEMENT NO. _____ dated __________, ___ of WILMINGTON
TRUST COMPANY, not in its individual capacity but solely as owner trustee (the
"Owner Trustee") under the Trust Agreement [GPA 1989 BN-10] dated as of
December 19, 1989 (as amended, the "Trust Agreement") between Wilmington Trust
Company and the Owner Participant named therein.
W I T N E S S E T H :
WHEREAS, the Trust Indenture and Security Agreement [GPA 1989 BN-10] dated
as of December 19, 1989, as amended and restated as of October 1, 1991 and as
further amended and restated as of November , 1996 (as so amended and
restated, the "Indenture") between the Owner Trustee and The Chase Manhattan
Bank (formerly known as Chemical Bank, successor by merger to Manufacturers
Hanover Trust Company), as Indenture Trustee (the "Indenture Trustee"),
provides for the execution and delivery of a supplement thereto substantially
in the form hereof which shall particularly describe the Aircraft (such term
and other defined terms in the Indenture being herein used with the same
meanings) and any Replacement Airframe or Replacement Engine included in the
Trust Indenture Estate, and shall specifically mortgage such Aircraft,
Replacement Airframe or Replacement Engine, as the case may be, to the
Indenture Trustee.
WHEREAS, the Original Indenture, as supplemented by Trust Indenture
Supplement No. 1 dated December 22, 1989 subjected to the Lien of such
Indenture the airframe and engines therein described, which Original Indenture
and Trust Indenture Supplement No. 1 have been duly recorded with the Federal
Aviation Administration as one document on December 27, 1989 and assigned
Conveyance No. S86321.
WHEREAS, the Amended and Restated Indenture (which
amended and restated the Original Indenture), as supplemented by Trust
Indenture Supplement No. 2 dated October 24, 1991 subjected to the Lien of such
Indenture the airframe and engines therein described, which Amended and
Restated Indenture and Trust Indenture Supplement No. 2 have been duly recorded
with the Federal Aviation Administration as one document on October 25, 1991
and assigned Conveyance No. Q52003.
102
- 2 -
WHEREAS(1), the Indenture relates to the Airframe and Engines described
below and a counterpart of the Indenture is attached hereto and made a part
hereof and this Indenture Supplement, together with such counterpart of the
Indenture, is being filed for recordation on the date hereof with the Federal
Aviation Administration as one document.
WHEREAS(2), the Owner Trustee has, as provided in the Indenture, heretofore
executed and delivered to the Indenture Trustee [3] Indenture Supplement(s) for
the purpose of specifically subjecting to the Lien of the Indenture certain
airframes and/or engines therein described, which Indenture Supplement(s) is
(are) dated and has (have) been duly recorded with the Federal Aviation
Administration as set forth below, to wit:
Date Recordation Date FAA Document No.
NOW, THEREFORE, This Supplement Witnesseth, that, to secure the prompt
payment of the Principal Amount of, interest on, Make-Whole Amount, if any, and
all other amounts due with respect to, all Equipment Notes from time to time
outstanding under the Indenture and the performance and observance by the Owner
Trustee of all the agreements, covenants and provisions contained in the
Indenture and the Refunding Agreement and the Equipment Notes, for the benefit
of the Note Holders, and the prompt payment of any and all amounts from time to
time owing under the Refunding Agreement by the Owner Trustee, the Owner
Participant and the Lessee in each case to the Note Holders and for the uses and
purposes and subject to the terms and provisions of the Indenture, and in
consideration of the premises and of the covenants contained in the Indenture,
and of the acceptance of the Equipment Notes by the Holders thereof, and of the
sum of $1 paid to the Owner Trustee by the Indenture Trustee at or before the
delivery of the Indenture, the receipt whereof is hereby acknowledged, the Owner
Trustee has granted, bargained, sold,
--------------------
1 This recital is to be included only in the first Indenture Supplement
(including the first Indenture Supplement filed with respect to the
Indenture).
2 This recital not to be included in the first Indenture Supplement.
3 Insert appropriate number.
Form of Trust Indenture Supplement
103
- 3 -
assigned, transferred, conveyed, mortgaged, pledged and confirmed, and does
hereby grant, bargain, sell, assign, transfer, convey, mortgage, pledge and
confirm, unto the Indenture Trustee, its successors and assigns, for the
security and benefit of the Note Holders from time to time, in the trust created
by the Indenture, a first priority security interest in and mortgage Lien on all
estate, right, title and interest of the Owner Trustee in, to and under the
following described property:
AIRFRAME(S)
( ) airframe(s) identified as follows:
FAA Registration Manufacturer's
Manufacturer Model Number Serial Number
together with all appliances, equipment, instruments and accessories
(including, without limitation, radio and radar) from time to time thereto
belonging, owned by the Owner Trustee and installed in or appurtenant to said
aircraft.
AIRCRAFT ENGINES
( ) aircraft engines, each such engine having 750 or more rated
takeoff horsepower or the equivalent thereof, identified as
follows:
Manufacturer's
Manufacturer Model Serial Number
together with all equipment and accessories thereto belonging, by
whomsoever manufactured, owned by the Owner Trustee and installed in or
appurtenant to said aircraft engines.
Together with all substitutions, replacements and renewals of the property
above described, and all property which shall hereafter become physically
attached to or incorporated in the property above described, whether the same
are now owned by the Owner Trustee or shall hereafter be acquired by it.
Form of Trust Indenture Supplement
104
- 4 -
As further security for the obligations referred to above and secured by
the Indenture and hereby, the Owner Trustee has granted, bargained, sold,
assigned, transferred, conveyed, mortgaged, pledged and confirmed, and does
hereby grant, bargain, sell, assign, transfer, convey, mortgage, pledge and
confirm, unto the Indenture Trustee, its successors and assigns, for the
security and benefit of the Note Holders from time to time, in the trust
created by the Indenture, all of the estate, right, title and interest of the
Owner Trustee in, to and under the Lease and Lease Supplement [GPA 1989 BN-10]
No. 3 of even date herewith (other than Excepted Payments) covering the
property described above.
TO HAVE AND TO HOLD all and singular the aforesaid property unto the
Indenture Trustee, its successors and assigns, for the benefit and security of
the Note Holders from time to time for the uses and purposes and subject to the
terms and provisions set forth in the Indenture.
This Supplement shall be construed as supplemental to the Indenture and
shall form a part of it, and the Indenture is hereby incorporated by reference
herein and is hereby ratified, approved and confirmed.
This Supplement is being delivered in the State of New York.
AND, FURTHER, the Owner Trustee hereby acknowledges that the Aircraft
and/or Engines referred to in this Supplement and the aforesaid Lease
Supplement has been delivered to the Owner Trustee and is included in the
property of the Owner Trustee covered by all the terms and conditions of the
Trust Agreement, subject to the pledge and mortgage thereof under the
Indenture.
Form of Trust Indenture Supplement
105
- 5 -
IN WITNESS WHEREOF, the Owner Trustee has caused this Supplement to be
duly executed by one of its officers thereunto duly authorized on the day and
year first above written.
WILMINGTON TRUST COMPANY, not in its
individual capacity, except as
otherwise expressly provided herein,
but solely as Owner Trustee
By_________________________
Title:
Form of Trust Indenture Supplement
106
SCHEDULE I
TO
SECOND AMENDED AND RESTATED
TRUST INDENTURE AND SECURITY AGREEMENT
[GPA 1989 BN-10]
MATURITY
PRINCIPAL AMOUNT DATE DEBT RATE
Series A.......... $
Series B.......... $
Series C.......... $
Series D.......... $
107
EQUIPMENT NOTES AMORTIZATION
SERIES A
Aircraft: N631AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
108
SERIES B
Aircraft: N631AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
109
SERIES C
Aircraft: N631AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
110
SERIES D
Aircraft: N631AW
Principal Amount Percentage of Original
Repayment Date Amount to be Paid
111
SCHEDULE II
TO
SECOND AMENDED AND RESTATED TRUST INDENTURE
AND SECURITY AGREEMENT
[GPA 1989 BN-10]
PASS THROUGH TRUST AGREEMENTS
1. Pass Through Trust Agreement, dated as of November __, 1996, among America
West Airlines, Inc., and Fleet National Bank, as supplemented by Trust
Supplement No. 1996-1A, dated November __, 1996.
2. Pass Through Trust Agreement, dated as of November __, 1996, among America
West Airlines, Inc., and Fleet National Bank, as supplemented by Trust
Supplement No. 1996-1B, dated November __, 1996.
3. Pass Through Trust Agreement, dated as of November __, 1996, among America
West Airlines, Inc., and Fleet National Bank, as supplemented by Trust
Supplement No. 1996-1C, dated November __, 1996.
4. Pass Through Trust Agreement, dated as of November __, 1996, among America
West Airlines, Inc., and Fleet National Bank, as supplemented by Trust
Supplement No. 1996-1D, dated November __, 1996.
