FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported)
August 31, 1999
US Airways Group, Inc.
(Commission file number: 1-8444)
and
US Airways, Inc.
(Commission file number: 1-8442)
(Exact names of registrants as specified in their charters)
Delaware US Airways, Group Inc. 54-1194634
(State of incorporation US Airways, Inc. 53-0218143
of both registrants) (I.R.S. Employer Identification Nos.)
US Airways Group, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
(703) 872-5306
(Registrant's telephone number, including area code)
US Airways, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
(703) 872-7000
(Registrant's telephone number, including area code)
Item 7. Financial Statements and Exhibits
(a) Not applicable
(b) Not applicable
(c) Exhibits. See exhibit list below.
The following documents are being filed as Exhibits in connection
with, and incorporated by reference into, US Airways, Inc.'s and US Airways
Group, Inc.'s Registration Statement on Form S-3 (Registration No. 333-
79825). The Registration Statement and the Prospectus Supplement, dated
August 24, 1999 to the Prospectus, dated July 30, 1999, relate to the
offering by US Airways, Inc. of Pass Through Certificates, Series 1999-1.
Reg. No.
333-79825
Exhibit No. Document
- ------------ --------
4(a)(i) Pass Through Trust Agreement, dated July 30, 1999, between
State Street Bank and Trust Company of Connecticut, National
Association, as Pass Through Trustee, US Airways, Inc. and US
Airways Group, Inc.+
4(a)(ii) Pass Through Trust Supplement No. 1999-1A, dated August 31,
1999, between State Street Bank and Trust Company of
Connecticut, National Association, as Pass Through Trustee,
and US Airways, Inc.+
4(a)(iii) Pass Through Trust Supplement No. 1999-1B, dated August 31,
1999, between State Street Bank and Trust Company of
Connecticut, National Association, as Pass Through Trustee,
and US Airways, Inc.+
4(a)(iv) Deposit Agreement (Class A), dated August 31, 1999, between
First Security Bank, National Association, as Escrow Agent,
and ABN AMRO Bank, N.V., as Class A Depositary+
4(a)(v) Deposit Agreement (Class B), dated August 31, 1999, between
First Security Bank, National Association, as Escrow Agent,
and ABN AMRO Bank, N.V., as Class B Depositary+
4(a)(vi) Revolving Credit Agreement (Class A), dated August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, and AIG Matched
Funding Corp., as Liquidity Provider+
4(a)(vii) Revolving Credit Agreement (Class B), dated August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, and AIG Matched
Funding Corp., as Liquidity Provider+
4(a)(viii) Revolving Credit Agreement (Class C), dated August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, and AIG Matched
Funding Corp., as Liquidity Provider+
4(a)(ix) Intercreditor Agreement, dated August 31, 1999, among State
Street Bank and Trust Company of Connecticut, National
Association, as Pass Through Trustee and as Subordination
Agent, and AIG Matched Funding Corp., as Liquidity Provider+
4(a)(x) Escrow and Paying Agent Agreement (Class A), dated August 31,
1999, among First Security Bank, National Association, as
Escrow Agent, Credit Suisse First Boston Corporation, Deutsche
Bank Securities Inc., Goldman, Sachs & Co., Donaldson, Lufkin
& Jenrette Securities Corporation and Salomon Smith Barney
Inc., as Underwriters, and State Street Bank and Trust Company
of Connecticut, National Association, as Class A Trustee and
as Paying Agent+
4(a)(xi) Escrow and Paying Agent Agreement (Class B), dated August 31,
1999, among First Security Bank, National Association, as
Escrow Agent, Credit Suisse First Boston Corporation, Deutsche
Bank Securities Inc., Goldman, Sachs & Co., Donaldson, Lufkin
& Jenrette Securities Corporation and Salomon Smith Barney
Inc., as Underwriters, and State Street Bank and Trust Company
of Connecticut, National Association, as Class B Trustee and
as Paying Agent+
4(a)(xii) Note Purchase Agreement, dated August 31, 1999, among US
Airways, Inc., State Street Bank and Trust Company of
Connecticut, National Association, as Pass Through Trustee,
Subordination Agent, and as Paying Agent, and First Security
Bank, National Association, as Escrow Agent+
4(a)(xiii) Exhibit A-1 to Note Purchase Agreement -- Form of Leased
Aircraft Participation Agreement+
4(a)(xiv) Exhibit A-2-1 to Note Purchase Agreement Form of Basic Lease+
4(a)(xv) Exhibit A-2-2 to Note Purchase Agreement Form of Deferred
Equity/Prepaid-Deferred Rent Lease+
4(a)(xvi) Exhibit A-3 to Note Purchase Agreement Form of Leased Aircraft
Indenture+
4(a)(xvii) Exhibit A-4 to Note Purchase Agreement Form of Aircraft
Purchase Agreement Assignment+
4(a)(xviii) Exhibit A-5 to Note Purchase Agreement Form of Leased Aircraft
Trust Agreement+
4(a)(xix) Exhibit A-6 to Note Purchase Agreement Form of Leased Aircraft
French Pledge Agreement+
4(a)(xx) Exhibit C-1 to Note Purchase Agreement -- Form of Owned
Aircraft Participation Agreement+
4(a)(xxi) Exhibit C-2 to Note Purchase Agreement Form of Owned Aircraft
Indenture+
4(a)(xxii) Exhibit C-3 to Note Purchase Agreement Form of Owned Aircraft
Purchase Agreement Assignment+
4(a)(xxiii) Exhibit C-4 to Note Purchase Agreement Form of Owned Aircraft
French Pledge Agreement+
4(a)(xxiv) Class A Global Certificates+
4(a)(xxv) Class B Global Certificate+
5(a)(i) Opinion of Skadden, Arps, Slate Meagher & Flom (Illinois)+
5(a)(ii) Opinion of Skadden, Arps, Slate Meagher & Flom, LLP+
+ Filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrants have duly caused this report to be signed on their behalf
by the undersigned hereunto duly authorized.
US Airways Group, Inc. (REGISTRANT)
Date: September 3, 1999 By: /s/ Anita P. Beier
-----------------------
Anita P. Beier
Vice President and Controller
(Chief Accounting Officer)
US Airways, Inc. (REGISTRANT)
Date: September 3, 1999 By: /s/ Anita P. Beier
-----------------------
Anita P. Beier
Vice President and Controller
(Chief Accounting Officer)
- ------------------------------------------------------------------------------
Exhibit 4(a)(i)
PASS THROUGH TRUST AGREEMENT
Dated July 30, 1999
between
US AIRWAYS, INC.,
US AIRWAYS GROUP, INC.
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Trustee
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS.........................................................2
Section 1.01. Definitions..............................2
Section 1.02. Compliance Certificates and Opinions....14
Section 1.03. Form of Documents Delivered to Trustee..15
Section 1.04. Directions of Certificateholders........15
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES:
ACQUISITION OF TRUST PROPERTY................................17
Section 2.01. Amount Unlimited; Issuable in Series....17
Section 2.02. Acquisition of Equipment Notes..........19
Section 2.03. Acceptance by Trustee...................21
Section 2.04. Limitation of Powers....................22
ARTICLE III
THE CERTIFICATES.............................................22
Section 3.01. Form, Denomination and Execution of
Certificates...........................................22
Section 3.02. Authentication of Certificates..........23
Section 3.03. Temporary Certificates..................23
Section 3.04. Transfer and Exchange...................23
Section 3.05. Book-Entry and Definitive Certificates..24
Section 3.06. Mutilated, Destroyed, Lost or Stolen
Certificates...........................................27
Section 3.07. Persons Deemed Owners...................27
Section 3.08. Cancellation............................27
Section 3.09. Limitation of Liability for Payments....28
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS...........................................28
Section 4.01. Certificate Account and Special Payments
Account................................................28
Section 4.02. Distributions from Certificate Account
and Special Payments Account...........................29
Section 4.03. Statements to Certificateholders........31
Section 4.04. Investment of Special Payment Moneys....32
ARTICLE V
THE COMPANY..................................................32
Section 5.01. Maintenance of Corporate Existence......32
Section 5.02. Consolidation, Merger, Etc..............32
ARTICLE VI
DEFAULT......................................................34
Section 6.01. Indenture Events of Default and
Triggering Events......................................34
Section 6.02. Incidents of Sale of Equipment Notes....35
Section 6.03. Judicial Proceedings Instituted by
Trustee; Trustee May Bring Suit................36
Section 6.04. Control by Certificateholders...........36
Section 6.05. Waiver of Past Defaults.................37
Section 6.06. Right of Certificateholders to Receive
Payments Not to Be Impaired....................37
Section 6.07. Certificateholders May Not Bring Suit
Except Under Certain Conditions................38
Section 6.08. Remedies Cumulative.....................38
Section 6.09. Undertaking for Costs...................39
ARTICLE VII
THE TRUSTEE..................................................39
Section 7.01. Certain Duties and Responsibilities.....39
Section 7.02. Notice of Defaults......................40
Section 7.03. Certain Rights of Trustee...............40
Section 7.04. Not Responsible for Recitals or Issuance
of Certificates................................41
Section 7.05. May Hold Certificates...................42
Section 7.06. Money Held in Trust.....................42
Section 7.07. Compensation and Reimbursement..........42
Section 7.08. Corporate Trustee Required; Eligibility.43
Section 7.09. Resignation and Removal, Appointment of
Successor......................................43
Section 7.10. Acceptance of Appointment by Successor..45
Section 7.11. Merger, Conversion, Consolidation or
Succession to Business.........................46
Section 7.12. Maintenance of Agencies.................46
Section 7.13. Money for Certificate Payments to Be Held
in Trust.......................................48
Section 7.14. Registration of Equipment Notes in
Trustee's Name.................................48
Section 7.15. Representations and Warranties of
Trustee........................................48
Section 7.16. Withholding Taxes; Information Reporting50
Section 7.17. Trustee's Liens.........................50
Section 7.18. Preferential Collection of Claims.......50
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE.............50
Section 8.01. The Company to Furnish Trustee with Names
and Addresses of Certificateholders............50
Section 8.02. Preservation of Information,
Communications to Certificateholders...........51
Section 8.03. Reports by Trustee......................51
Section 8.04. Reports by the Company..................51
ARTICLE IX
SUPPLEMENTAL AGREEMENTS................................52
Section 9.01. Supplemental Agreements Without Consent of
Certificateholders.............................52
Section 9.02. Supplemental Agreements With Consent of
Certificateholders.............................54
Section 9.03. Documents Affecting Immunity or
Indemnity......................................55
Section 9.04. Execution of Supplemental Agreements....55
Section 9.05. Effect of Supplemental Agreements.......55
Section 9.06. Conformity With Trust Indenture Act.....56
Section 9.07. Reference in Certificates to Supplemental
Agreements.....................................56
Section 9.08. Release of Parent. .....................56
ARTICLE X
AMENDMENTS TO INDENTURE AND NOTE DOCUMENTS...................56
Section 10.01. Amendments and Supplements to Indenture
and Other Note Documents.......................56
ARTICLE XI
TERMINATION OF TRUSTS........................................57
Section 11.01. Termination of the Trusts..............57
ARTICLE XII
MISCELLANEOUS PROVISIONS.....................................58
Section 12.01. Limitation on Rights of
Certificateholders.....................................58
Section 12.02. Liabilities of Certificateholders......59
Section 12.03. Registration of Equipment Notes in Name
of Subordination Agent.........................59
Section 12.04. Notices................................59
Section 12.05. Governing Law..........................60
Section 12.06. Severability of Provisions.............61
Section 12.07. Trust Indenture Act Controls...........61
Section 12.08. Effect of Headings and Table of
Contents.......................................61
Section 12.09. Successors and Assigns.................61
Section 12.10. Benefits of Agreement..................61
Section 12.11. Legal Holidays.........................61
Section 12.12. Counterparts...........................61
Section 12.13. Communication by Certificateholders With
Other Certificateholders.........................62
Section 12.14. Intention of Parties...................62
EXHIBIT A
FORM OF CERTIFICATE.........................................A-1
EXHIBIT B
FORM OF GUARANTEED CERTIFICATE..............................B-1
Reconciliation and tie between US Airways Pass Through Trust Agreement,
dated July 30, 1999 and the Trust Indenture Act of 1939. This
reconciliation does not constitute part of the Pass Through Trust
Agreement.
Trust Indenture Act Pass Through Trust
of 1939 Section Agreement Section
310(a)(1) 7.08
(a)(2) 7.08
312(a) 3.05; 8.01; 8.02
313(a) 8.03
314(a)(1)-(3) 8.04(a)-(c)
(a)(4) 8.04(d)
(c)(1) 1.02
(c)(2) 1.02
(d)(1) 7.13; 11.01
(d)(2) 7.13; 11.01
(d)(3) 2.01
(e) 1.02
315(b) 7.02
316(a)(last sentence) 1.04(c)
(a)(1)(A) 6.04
(a)(1)(B) 6.05
(b) 6.06
(c) 1.04(d
317(a)(1) 6.03
(b) 7.13
318(a) 12.07
PASS THROUGH TRUST AGREEMENT
This PASS THROUGH TRUST AGREEMENT, dated as of July 30, 1999 (the
"Basic Agreement"), between US AIRWAYS, INC., a Delaware corporation (the
"Company"), US AIRWAYS GROUP, INC., a Delaware corporation (the "Parent")
and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, a national banking association, as Trustee, is made with
respect to the formation from time to time of separate US Airways Pass
Through Trusts, and the issuance from time to time of separate series of
Pass Through Certificates representing fractional undivided interests in
the respective Trusts.
W I T N E S S E T H:
WHEREAS, from time to time, the Company, and the Trustee may enter
into a Trust Supplement (this and certain other defined terms used herein
are defined in Section 1.01) pursuant to which the Trustee shall declare
the creation of a separate Trust for the benefit of the Holders of the
series of Certificates to be issued in respect of such Trust, and the
initial Holders of the Certificates of such series, as the grantors of such
Trust, by their respective acceptances of the Certificates of such series,
shall join in the creation of such Trust with the Trustee;
WHEREAS, all Certificates to be issued in respect of each separate
Trust will be issued as a separate series pursuant to this Agreement, will
evidence fractional undivided interests in such Trust and will have no
rights, benefits or interests in respect of any other separate Trust or the
property held therein, subject, however, to the provisions of any
Intercreditor Agreement to which one or more Trusts may be a party;
WHEREAS, from time to time, pursuant to the terms and conditions of
this Agreement with respect to each separate Trust formed under this
Agreement, the Trustee on behalf of such Trust shall purchase one or more
issues of Equipment Notes having the same interest rate as, and final
maturity dates not later than the final Regular Distribution Date of, the
series of Certificates issued in respect of such Trust and, subject to the
terms of any related Intercreditor Agreement, shall hold such Equipment
Notes in trust for the benefit of the Certificateholders of such Trust;
WHEREAS, to facilitate the sale of Equipment Notes to, and the
purchase of Equipment Notes by, the Trustee on behalf of each Trust created
from time to time pursuant to this Agreement, the Company as the "issuer",
as such term is defined in and solely for purposes of the Securities Act of
1933, as amended, of the Certificates to be issued in respect of each Trust
and as the "obligor", as such term is defined in and solely for purposes of
the Trust Indenture Act has duly authorized the execution and delivery of
this Basic Agreement and each Trust Supplement with respect to all such
Certificates and is undertaking to perform certain administrative and
ministerial duties under this Agreement and is also undertaking to pay the
fees and expenses of the Trustee;
WHEREAS, the Parent may, from time to time, guaranty the obligations
of the Company (i) under the Equipment Notes issued to finance the Owned
Aircraft, and (ii) payment of all amounts payable under the related Lease
entered into for a Leased Aircraft (the "Parent Guaranty");
WHEREAS, if on behalf of any separate Trust created by the Company
and the Trustee pursuant to a Trust Supplement the Trustee acquires any
such guaranteed Equipment Notes, the Parent will become a party to such
Trust Supplement;
WHEREAS, to facilitate the sale of Equipment Notes to, and the
purchase of Equipment Notes by, the Trustee on behalf of each Trust created
from time to time pursuant to this Agreement, the Parent has duly
authorized the execution and delivery of this Basic Agreement and each
Trust Supplement to which it shall be a party, with respect to all such
Certificates and is undertaking to perform certain administrative and
ministerial duties under this Agreement and is also undertaking to pay the
fees and expenses of the Trustee; and
WHEREAS, this Basic Agreement, as supplemented from time to time, is
subject to the provisions of the Trust Indenture Act and shall, to the
extent applicable, be governed by such provisions;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. For all purposes of this Basic Agreement,
except as otherwise expressly provided or unless the context otherwise
requires:
(1) the terms used herein that are defined in this Article I
have the meanings assigned to them in this Article I, and include the
plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, or by the
rules promulgated under the Trust Indenture Act, have the meanings
assigned to them therein;
(3) all references in this Basic Agreement to designated
"Articles", "Sections", "Subsections" and other subdivisions are to
the designated Articles, Sections, Subsections and other subdivisions
of this Basic Agreement;
(4) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Basic Agreement as a whole and
not to any particular Article, Section, Subsection or other
subdivision;
(5) unless the context otherwise requires, whenever the words
"including", "include" or "includes" are used herein, it shall be
deemed to be followed by the phrase "without limitation"; and
(6) the term "this Agreement" (as distinguished from "this
Basic Agreement") refers, unless the context otherwise requires, to
this Basic Agreement as supplemented by the Trust Supplement creating
a particular Trust and establishing the series of Certificates issued
or to be issued in respect thereof, with reference to such Trust and
such series of Certificates, as this Basic Agreement as so
supplemented may be further supplemented with respect to such Trust
and such series of Certificates.
Act: Has the meaning, with respect to any Certificateholder,
specified in Section 1.04(a).
Affiliate: Means, with respect to any specified Person, any
other Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such Person. For the
purposes of this definition, "control", when used with respect to any
specified Person, means the power, directly or indirectly, to direct
the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise, and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing.
Aircraft: Means one or more aircraft, including engines
therefor, owned by or leased to the Company and securing one or more
Equipment Notes.
Authorized Agent: Means, with respect to the Certificates of
any series, any Paying Agent or Registrar for the Certificates of
such series.
Basic Agreement: Means this Pass Through Trust Agreement, as
the same may from time to time be supplemented, amended or modified,
but does not include any Trust Supplement.
Book-Entry Certificates: Means, with respect to the
Certificates of any series, a beneficial interest in the Certificates
of such series, ownership and transfers of which shall be made
through book entries as described in Section 3.05.
Business Day: Means, with respect to the Certificates of any
series, any day other than a Saturday, a Sunday or a day on which
commercial banks are required or authorized to close in New York, New
York, or, so long as any Certificate of such series is outstanding,
the city and state in which the Trustee or any related Loan Trustee
maintains its Corporate Trust Office or receives and disburses funds.
Certificate: Means any one of the certificates executed and
authenticated by the Trustee, substantially in the form of Exhibit A
or Exhibit B, as applicable, hereto.
Certificate Account: Means, with respect to the Certificates of
any series, the account or accounts created and maintained for such
series pursuant to Section 4.01(a) and the related Trust Supplement.
Certificateholder or Holder: Means, with respect to the
Certificates of any series, the Person in whose name a Certificate of
such series is registered in the Register for Certificates of such
series.
Certificate Owner: Means, with respect to the Certificates of
any series, for purposes of Section 3.05, the Person who owns a
Book-Entry Certificate of such series.
Clearing Agency: Means an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange
Act of 1934, as amended.
Clearing Agency Participant: Means a broker, dealer, bank,
other financial institution or other Person for whom from time to
time a Clearing Agency effects, directly or indirectly, book-entry
transfers and pledges of securities deposited with the Clearing
Agency.
Company: Means US Airways, Inc., a Delaware corporation, or its
successor in interest pursuant to Section 5.02, or (only in the
context of provisions hereof, if any, when such reference is required
for purposes of compliance with the Trust Indenture Act) any other
"obligor" (within the meaning of the Trust Indenture Act) with
respect to the Certificates of any series.
Controlling Party: Means the Person entitled to act as such
pursuant to the terms of any Intercreditor Agreement.
Corporate Trust Office: Means, with respect to the Trustee or
any Loan Trustee, the office of such trustee in the city at which at
any particular time its corporate trust business shall be principally
administered.
Cut-off Date: Means, with respect to the Certificates of any
series, the date designated as such in the Trust Supplement
establishing such series.
Definitive Certificates: Has the meaning, with respect to the
Certificates of any series, specified in Section 3.05.
Direction: Has the meaning specified in Section 1.04(a).
Equipment Notes: Means, with respect to the Certificates of any
series, all of the equipment notes issued under the Indentures
related to such series of Certificates.
ERISA: Means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor federal statute.
Escrow Account: Has the meaning, with respect to the
Certificates of any series, specified in Section 2.02(b).
Escrowed Funds: Has the meaning, with respect to any
Trust, specified in Section 2.02(b).
Event of Default: Means, in respect of any Trust, an Indenture
Event of Default under any Indenture pursuant to which Equipment
Notes held by such Trust were issued.
Fractional Undivided Interest: Means the fractional undivided
interest in a Trust that is evidenced by a Certificate relating to
such Trust.
Indenture: Means, with respect to any Trust, each of the one or
more separate trust indenture and security agreements or trust
indenture and mortgages or similar documents described in, or on a
schedule attached to, the Trust Supplement and an indenture having
substantially the same terms and conditions which relates to a
Substitute Aircraft, as each such indenture may be amended or
supplemented in accordance with its respective terms; and
"Indentures" means all of such agreements.
Indenture Event of Default: Means, with respect to any
Indenture, any Indenture Event of Default (as such term is defined in
such Indenture).
Initial Regular Distribution Date: Means, with respect to the
Certificates of any series, the first Regular Distribution Date on
which a Scheduled Payment is to be made.
Intercreditor Agreement: Means any agreement by and among the
Trustee, as trustee hereunder with respect to one or more Trusts, one
or more Liquidity Providers and a Subordination Agent providing,
among other things, for the distribution of payments made in respect
of Equipment Notes held by such Trusts.
Issuance Date: Means, with respect to the Certificates of any
series, the date of the issuance of such Certificates.
Lease: Means any lease between an Owner Trustee, as the lessor,
and the Company, as the lessee, referred to in the related Indenture,
as such lease may be amended, supplemented or otherwise modified in
accordance with its terms; and "Leases" means all such Leases.
Letter of Representations: Means, with respect to the
Certificates of any series, an agreement among the Company, the
Trustee and the initial Clearing Agency substantially in the form
attached as an Exhibit to the related Trust Supplement.
Liquidity Facility: Means, with respect to the Certificates of
any series, any revolving credit agreement, letter of credit or
similar facility relating to the Certificates of such series between
a bank or other financial institution and a Subordination Agent, as
amended, replaced, supplemented or otherwise modified from time to
time in accordance with its terms and the terms of any Intercreditor
Agreement.
Liquidity Provider: Means, with respect to the Certificates of
any series, a bank or other financial institution that agrees to
provide a Liquidity Facility for the benefit of the holders of
Certificates of such series.
Loan Trustee: Means, with respect to any Equipment Note or the
Indenture applicable thereto, the bank or trust company designated as
loan or indenture trustee under such Indenture, and any successor to
such Loan Trustee as such trustee; and "Loan Trustees" means all of
the Loan Trustees under the Indentures.
Note Documents: Means, with respect to the Certificates of any
series, the Equipment Notes with respect to such Certificates and,
with respect to such Equipment Notes, the related Indenture, Note
Purchase Agreement and, if the Aircraft is leased to the Company, the
related Lease and, if applicable, the Parent Guaranty relating to
such Lease, and the related Purchase Agreement Assignment, or if the
Aircraft is an Aircraft owned by the Company, including the Parent
Guaranty, if applicable, relating to such Equipment Notes.
Note Purchase Agreement: Means, with respect to the
Certificates of any series, any note purchase, refunding,
participation or similar agreement providing for, among other things,
the purchase of Equipment Notes by the Trustee on behalf of the
relevant Trust; and "Note Purchase Agreements" means all such
agreements.
Officer's Certificate: Means a certificate signed, (a) in the
case of the Company or the Parent, by (i) the Chairman or Vice
Chairman of the Board of Directors, the President, any Executive Vice
President, any Senior Vice President or the Treasurer of the Company
or the Parent, as applicable, signing alone, or (ii) any Vice
President of the Company or the Parent, as applicable, signing
together with the Secretary, the Assistant Secretary, the Treasurer
or any Assistant Treasurer of the Company or the Parent or (b) in the
case of the Trustee or an Owner Trustee or a Loan Trustee, a
Responsible Officer of the Trustee or such Owner Trustee or such Loan
Trustee, as the case may be.
Opinion of Counsel: Means a written opinion of legal counsel
who (a) in the case of counsel for the Company or the Parent may be
(i) a senior attorney of the Company or the Parent one of whose
principal duties is furnishing advice as to legal matters, (ii)
Skadden, Arps, Slate, Meagher & Flom LLP (and any affiliate thereof)
or (iii) such other counsel designated by the Company and reasonably
acceptable to the Trustee and (b) in the case of any Owner Trustee or
any Loan Trustee, may be such counsel as may be designated by any of
them whether or not such counsel is an employee of any of them, and
who shall be reasonably acceptable to the Trustee.
Other Agreements: Has the meaning specified in Section
6.01(b).
Outstanding: When used with respect to Certificates of any
series, means, as of the date of determination, all Certificates of
such series theretofore authenticated and delivered under this
Agreement, except:
(i) Certificates of such series theretofore cancelled by
the Registrar or delivered to the Trustee or the Registrar for
cancellation;
(ii) All of the Certificates of such series if money in
the full amount required to make the final distribution with
respect to such series pursuant to Section 11.01 hereof has
been theretofore deposited with the Trustee in trust for the
Holders of the Certificates of such series as provided in
Section 4.01, pending distribution of such money to such
Certificateholders pursuant to payment of such final
distribution payment; and
(iii) Certificates of such series in exchange for or in
lieu of which other Certificates of such series have been
authenticated and delivered pursuant to this Agreement.
Owner Participant: Means, with respect to any Equipment Note,
the "Owner Participant", if any, as referred to in the Indenture
pursuant to which such Equipment Note is issued and any permitted
successor or assign of such Owner Participant; and "Owner
Participants" at any time of determination means all of the Owner
Participants thus referred to in the Indentures.
Owner Trustee: Means, with respect to any Equipment Note, the
"Owner Trustee", if any, as referred to in the Indenture pursuant to
which such Equipment Note is issued, not in its individual capacity
but solely as trustee; and "Owner Trustees" means all of the Owner
Trustees party to any of the related Indentures.
Parent: Means US Airways Group, Inc., a Delaware corporation,
or its successors in interest.
Parent Guaranty: Has the meaning specified in the Preamble.
Paying Agent: Means, with respect to the Certificates of any
series, the paying agent maintained and appointed for the
Certificates of such series pursuant to Section 7.12.
Permitted Investments: Means obligations of the United States
of America or agencies or instrumentalities thereof for the payment
of which the full faith and credit of the United States of America is
pledged, maturing in not more than 60 days after the date of
acquisition thereof or such lesser time as is required for the
distribution of any Special Payments on a Special Distribution Date.
Person: Means any person, including any individual,
corporation, limited liability company, partnership, joint venture,
association, joint-stock company, trust, trustee, unincorporated
organization, or government or any agency or political subdivision
thereof.
Pool Balance: Means, with respect to the Certificates of any
series as of any date, (i) the original aggregate face amount of the
Certificates of any series less (ii) the aggregate amount of all
payments made in respect of such Certificates other than payments
made in respect of interest or premium thereon or reimbursement of
any costs or expenses incurred in connection therewith. The Pool
Balance as of any Distribution Date shall be computed after giving
effect to the payment of principal, if any, on the Equipment Notes or
other Trust Property held in the Trust and the distribution thereof
to be made on such Distribution Date.
Pool Factor: Means, with respect to any series of Certificates
as of any date, the quotient (rounded to the seventh decimal place)
computed by dividing (i) the Pool Balance of such series as at such
date by (ii) the original aggregate face amount of the Certificates
of such series. The Pool Factor as of any Distribution Date shall be
computed after giving effect to the payment of principal, if any, on
the Equipment Notes or other Trust Property held in the Trust and the
distribution thereof to be made on such Distribution Date.
Postponed Notes: Means, with respect to any Trust or the
related series of Certificates, the Equipment Notes to be held in
such Trust as to which a Postponement Notice shall have been
delivered pursuant to Section 2.02(b).
Postponement Notice: Means, with respect to any Trust or the
related series of Certificates, an Officer's Certificate of the
Company signed by an officer of the Company (1) requesting that the
Trustee temporarily postpone purchase of the related Equipment Notes
to a date later than the Issuance Date of such series of
Certificates, (2) identifying the amount of the purchase price of
each such Equipment Note and the aggregate purchase price for all
such Equipment Notes, (3) setting forth the reasons for such
postponement and (4) with respect to each such Equipment Note, either
(a) setting or resetting a new Transfer Date (which shall be on or
prior to the applicable Cut-off Date) for payment by the Trustee of
such purchase price and issuance of the related Equipment Note
(subject to subsequent change from time to time in accordance with
the relevant Note Purchase Agreement), or (b) indicating that such
new Transfer Date (which shall be on or prior to the applicable
Cut-off Date) will be set by subsequent written notice not less than
one Business Day prior to such new Transfer Date (subject to
subsequent change from time to time in accordance with the relevant
Note Purchase Agreement).
Potential Purchaser: Has the meaning, with respect to any
Certificateholder, specified in Section 6.01(b).
PTC Event of Default: Means, with respect to the Certificates
of any series, any failure to pay within ten Business Days of the due
date thereof: (i) the outstanding Pool Balance of such series of
Certificates on the date specified in any Trust Supplement for such
payment or (ii) interest due on the Certificates of such series on
any Distribution Date (unless the related Subordination Agent shall
have made an Interest Drawing or Drawings (as defined in the related
Intercreditor Agreement), or a withdrawal or withdrawals pursuant to
a cash collateral account under such Intercreditor Agreement, with
respect thereto in an aggregate amount sufficient to pay such
interest and shall have distributed such amount to the Trustee).
Purchase Agreement Assignment: Has the meaning, with respect to
the Certificates of any series if the related Aircraft is leased to
the Company, specified therefor in the related Lease.
Purchasing Certificateholder: Has the meaning, with respect to
any Certificateholder, specified in Section 6.01(b).
Record Date: Means, with respect to any Trust or the related
series of Certificates, (i) for Scheduled Payments to be distributed
on any Regular Distribution Date, other than the final distribution
with respect to such series, the 15th day (whether or not a Business
Day) preceding such Regular Distribution Date, and (ii) for Special
Payments to be distributed on any Special Distribution Date, other
than the final distribution with respect to such series, the 15th day
(whether or not a Business Day) preceding such Special Distribution
Date.
Register and Registrar: Means, each with respect to the
Certificates of any series, the register maintained and the registrar
appointed pursuant to Sections 3.04 and 7.12.
Regular Distribution Date: Means, with respect to distributions
of Scheduled Payments in respect of any series of Certificates, each
date designated as such in this Agreement, until payment of all the
Scheduled Payments to be made under the Equipment Notes held in the
Trust have been made.
Request: Means a request by the Company setting forth the
subject matter of the request accompanied by an Officer's Certificate
and an Opinion of Counsel as provided in Section 1.02 of this Basic
Agreement.
Responsible Officer: Means, with respect to any Trustee, any
Loan Trustee and any Owner Trustee, any officer in the Corporate
Trust Department of the Trustee, Loan Trustee or Owner Trustee or any
other officer customarily performing functions similar to those
performed by the persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred
because of his knowledge of and familiarity with a particular
subject.
Responsible Party: Means, with respect to the Certificates of
any series, the person designated as such in the related Trust
Supplement.
Scheduled Payment: Means, with respect to any Equipment Note,
(i) any payment of principal or interest on such Equipment Note
(other than any such payment which is not in fact received by the
Trustee or any Subordination Agent within five days of the date on
which such payment is scheduled to be made) or (ii) any payment of
interest on the Certificates of any series with funds drawn under the
Liquidity Facility for such series (other than any such payment which
is not in fact received by the Trustee or any Subordination Agent
within five days of the date upon which payment is scheduled to be
made), which payment in the case of clauses (i) or clause (ii)
represents the installment of principal on such Equipment Note at the
stated maturity of such installment, the payment of regularly
scheduled interest accrued on the unpaid principal amount of such
Equipment Note, or both; provided, however, that any payment of
principal, premium, if any, or interest resulting from the redemption
or purchase of any Equipment Note shall not constitute a Scheduled
Payment.
SEC: Means the Securities and Exchange Commission, as from time
to time constituted or created under the Securities Exchange Act of
1934, as amended, or, if at any time after the execution of this
instrument such Commission is not existing and performing the duties
now assigned to it under the Trust Indenture Act, then the body
performing such duties on such date.
Selling Certificateholder: Has the meaning, with respect to any
Certificateholder, specified in Section 6.01(b).
Special Distribution Date: Means, with respect to the
Certificates of any series, each date on which a Special Payment is
to be distributed as specified in this Agreement.
Special Payment: Means (i) any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note or
Trust Indenture Estate (as defined in each Indenture), (ii) the
amounts required to be distributed pursuant to the last paragraph of
Section 2.02(b) or (iii) the amounts required to be distributed
pursuant to the penultimate paragraph of Section 2.02(b).
Special Payments Account: Means, with respect to the
Certificates of any series, the account or accounts created and
maintained for such series pursuant to Section 4.01(b) and the
related Trust Supplement.
Specified Investments: Means, with respect to any Trust, unless
otherwise specified in the related Trust Supplement, (i) obligations
of, or guaranteed by, the United States Government or agencies
thereof, (ii) open market commercial paper of any corporation
incorporated under the laws of the United States of America or any
state thereof rated at least P-2 or its equivalent by Moody's
Investors Service, Inc. or at least A-2 or its equivalent by Standard
& Poor's Ratings Services, a division of The McGraw-Hill Companies,
Inc., (iii) certificates of deposit issued by commercial banks
organized under the laws of the United States or of any political
subdivision thereof having a combined capital and surplus in excess
of $100,000,000 which banks or their holding companies have a rating
of A or its equivalent by Moody's Investors Service, Inc. or Standard
& Poor's Ratings Services, a division of The McGraw-Hill Companies,
Inc.; provided, however, that the aggregate amount at any one time so
invested in certificates of deposit issued by any one bank shall not
exceed 5% of such bank's capital and surplus, (iv) U.S.
dollar-denominated offshore certificates of deposit issued by, or
offshore time deposits with, any commercial bank described in clause
(iii) above or any subsidiary thereof and (v) repurchase agreements
with any financial institution having combined capital and surplus of
at least $100,000,000 with any of the obligations described in
clauses (i) through (iv) above as collateral; provided further that
if all of the above investments are unavailable, the entire amounts
to be invested may be used to purchase federal funds from an entity
described in clause (iii) above.
Subordination Agent: Has the meaning specified therefor in any
Intercreditor Agreement.
Substitute Aircraft: Means, with respect to any Trust, any
Aircraft of a type specified in this Agreement and, at the election
of the Company, substituted prior to the applicable Cut-off Date, if
any, pursuant to the terms of this Agreement.
Transfer Date: Has the meaning assigned to that term or any of
the terms "Delivery Date", "Funding Date" or "Closing Date" in a Note
Purchase Agreement, and in any event refers to any such date as it
may be changed from time to time in accordance with the terms of such
Note Purchase Agreement.
Triggering Event: Has the meaning specified therefor in any
Intercreditor Agreement.
Trust: Means, with respect to the Certificates of any series,
the trust under this Agreement.
Trustee: Means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, or
its successor in interest, and any successor or other trustee
appointed as provided herein.
Trust Indenture Act: Means, with respect to any particular
Trust, the Trust Indenture Act of 1939, as in force at the date as of
which the related Trust Supplement was executed.
Trust Property: Means, with respect to any Trust, (i) subject
to any related Intercreditor Agreement, the Equipment Notes held as
the property of such Trust, all monies at any time paid thereon and
all monies due and to become due thereunder, (ii) funds from time to
time deposited in the related Escrow Account, the related Certificate
Account and the related Special Payments Account and, subject to the
related Intercreditor Agreement, any proceeds from the sale by the
Trustee pursuant to Article VI hereof of any such Equipment Note,
(iii) all rights of such Trust and the Trustee, on behalf of the
Trust, under any Intercreditor Agreement, including, without
limitation, all monies receivable in respect of such rights, and (iv)
all monies receivable under any Liquidity Facility for such Trust.
Trust Supplement: Means an agreement supplemental hereto
pursuant to which (i) a separate Trust is created for the benefit of
the holders of the Certificates of a series, (ii) the issuance of the
Certificates of such series representing fractional undivided
interests in such Trust is authorized and (iii) the terms of the
Certificates of such series are established.
Section 1.02. Compliance Certificates and Opinions. Upon any
application or request (except with respect to matters set forth in Article
II) by the Company, any Owner Trustee or any Loan Trustee to the Trustee to
take any action under any provision of this Basic Agreement or, in respect
of the Certificates of any series, this Agreement, the Company, such Owner
Trustee or such Loan Trustee, as the case may be, shall furnish to the
Trustee (i) an Officer's Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Basic
Agreement or this Agreement relating to the proposed action have been
complied with and (ii) an Opinion of Counsel stating that in the opinion of
such counsel all such conditions precedent, if any, have been complied
with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any
provision of this Basic Agreement or this Agreement relating to such
particular application or request, no additional certificate or opinion
need be furnished.
Every Officer's Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Basic
Agreement or, in respect of the Certificates of any series, this Agreement
(other than a certificate provided pursuant to Section 8.04(d)) or any
Trust Supplement shall include:
(1) a statement that (x) each individual signing such
certificate or (y) each firm or person executing such Opinion of
Counsel has read such covenant or condition and the definitions in
this Basic Agreement or this Agreement relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such individual or
firm, he or it has made such examination or investigation as is
necessary to enable him or it to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual or firm, such condition or covenant has been complied
with.
Section 1.03. Form of Documents Delivered to Trustee. In any case
where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters
be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such
Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters and any such Person may
certify or give an opinion as to such matters in one or several documents.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or
other instruments under this Basic Agreement or, in respect of the
Certificates of any series, this Agreement, they may, but need not, be
consolidated and form one instrument.
Section 1.04. Directions of Certificateholders. (a) Any direction,
consent, request, demand, authorization, notice, waiver or other action
provided by this Agreement in respect of the Certificates of any series to
be given or taken by Certificateholders (a "Direction") may be embodied in
and evidenced by one or more instruments of substantially similar tenor
signed by such Certificateholders in person or by an agent or proxy 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 Trustee and, when it is hereby expressly required pursuant
to this Agreement, to the Company or any Loan Trustee. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are
herein sometimes referred to as the "Act" of the Certificateholders signing
such instrument or instruments. Proof of execution of any such instrument
or of a writing appointing any such agent or proxy shall be sufficient for
any purpose of this Trust Agreement and conclusive in favor of the Trustee,
the Company and the related Loan Trustee, if made in the manner provided in
this Section 1.04.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the certificate of any notary
public or other officer of any jurisdiction authorized to take
acknowledgments of deeds or administer oaths that the Person executing such
instrument acknowledged to him the execution thereof, or by an affidavit of
a witness to such execution sworn to before any such notary or such other
officer, and where such execution is by an officer of a corporation or
association or a member of a partnership, on behalf of such corporation,
association or partnership, such certificate or affidavit shall also
constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other reasonable manner which
the Trustee deems sufficient.
(c) In determining whether the Certificateholders of the
requisite Fractional Undivided Interests of Certificates of any series
Outstanding have given any Direction under this Agreement, Certificates
owned by the Company, the Parent or any Affiliate thereof shall be
disregarded and deemed not to be Outstanding for purposes of any such
determination. In determining whether the Trustee shall be protected in
relying upon any such Direction, only Certificates which the Trustee knows
to be so owned shall be so disregarded. Notwithstanding the foregoing, (i)
if any such Person owns 100% of the Certificates of any series Outstanding,
such Certificates shall not be so disregarded, and (ii) if any amount of
Certificates of any series so owned by any such Person have been pledged in
good faith, such Certificates shall not be disregarded if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Certificates and that the pledgee is not the
Company, the Parent or any Affiliate thereof.
(d) The Company may, at its option, by delivery of an Officer's
Certificate to the Trustee, set a record date to determine the
Certificateholders in respect of the Certificates of any series, entitled
to give any Direction. Notwithstanding Section 316(c) of the Trust
Indenture Act, such record date shall be the record date specified in such
Officer's Certificate, which shall be a date not more than 30 days prior to
the first solicitation of Certificateholders of the applicable series in
connection therewith. If such a record date is fixed, such Direction may be
given before or after such record date, but only the Certificateholders of
record of the applicable series at the close of business on such record
date shall be deemed to be Certificateholders for the purposes of
determining whether Certificateholders of the requisite proportion of
Outstanding Certificates of such series have authorized or agreed or
consented to such Direction, and for that purpose the Outstanding
Certificates shall be computed as of such record date; provided, however,
that no such Direction by the Certificateholders on such record date shall
be deemed effective unless it shall become effective pursuant to the
provisions of this Agreement not later than one year after such record
date.
(e) Any Direction by the Holder of any Certificate shall bind
the Holder of every Certificate issued upon the transfer thereof or in
exchange therefor or in lieu thereof, whether or not notation of such
Direction is made upon such Certificate.
(f) Except as otherwise provided in Section 1.04(c),
Certificates of any series owned by or pledged to any Person shall have an
equal and proportionate benefit under the provisions of this Agreement,
without preference, priority or distinction as among all of the
Certificates of such series.
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES:
ACQUISITION OF TRUST PROPERTY
Section 2.01. Amount Unlimited; Issuable in Series. (a) The aggregate
principal amount of Certificates which may be authenticated and delivered
under this Basic Agreement is unlimited. The Certificates may be issued
from time to time in one or more series and shall be designated generally
as the "Pass Through Certificates", with such further designations added or
incorporated in such title for the Certificates of each series as specified
in the related Trust Supplement. Each Certificate shall bear upon its face
the designation so selected for the series to which it belongs. All
Certificates of the same series shall be substantially identical except
that the Certificates of a series may differ as to denomination and as may
otherwise be provided in the Trust Supplement establishing the Certificates
of such series. Each series of Certificates issued pursuant to this
Agreement will evidence fractional undivided interests in the related Trust
and, except as may be contained in any Intercreditor Agreement, will have
no rights, benefits or interests in respect of any other Trust or the Trust
Property held therein. All Certificates of the same series shall be in all
respects equally and ratably entitled to the benefits of this Agreement
without preference, priority or distinction on account of the actual time
or times of authentication and delivery, all in accordance with the terms
and provisions of this Agreement.
(b) The following matters shall be established with respect to
the Certificates of each series issued under this Agreement by a Trust
Supplement executed and delivered by and among the Company, the Parent, if
the Parent is a party to such Trust Supplement, and the Trustee:
(1) the formation of the Trust as to which the Certificates of
such series represent fractional undivided interests and its
designation (which designation shall distinguish such Trust from each
other Trust created under this Basic Agreement and a Trust
Supplement);
(2) the specific title of the Certificates of such series
(which title shall distinguish the Certificates of such series from
each other series of Certificates created under this Basic Agreement
and a Trust Supplement);
(3) any limit upon the aggregate principal amount of the
Certificates of such series which may be authenticated and delivered
(which limit shall not pertain to Certificates authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Certificates of the series pursuant to Sections 3.03,
3.04 and 3.06);
(4) the Cut-off Date with respect to the Certificates of such
series;
(5) the Regular Distribution Dates applicable to the
Certificates of such series;
(6) the Special Distribution Dates applicable to the
Certificates of such series;
(7) if other than as provided in Section 7.12(b), the Registrar
or the Paying Agent for the Certificates of such series, including
any Co-Registrar or additional Paying Agent;
(8) if other than as provided in Section 3.01, the
denominations in which the Certificates of such series shall be
issuable;
(9) if other than United States dollars, the currency or
currencies (including currency units) in which the Certificates of
such series shall be denominated;
(10) the specific form of the Certificates of such series
(including the interest rate applicable thereto) and whether or not
Certificates of such series are to be issued as Book-Entry
Certificates and, if such Certificates are to be Book-Entry
Certificates, the form of Letter of Representations, if any (or, in
the case of any Certificates denominated in a currency other than
United States dollars and if other than as provided in Section 3.05,
whether and the circumstances under which beneficial owners of
interests in such Certificates in permanent global form may exchange
such interests for Certificates of such series and of like tenor of
any authorized form and denomination);
(11) a description of the Equipment Notes to be acquired and
held in the related Trust and of the related Aircraft and Note
Documents;
(12) provisions with respect to the terms for which the
definitions set forth in Article I hereof or the terms of Section
11.01 hereof permit or require further specification in the related
Trust Supplement;
(13) any restrictions (including legends) in respect of ERISA;
(14) whether such series will be subject to an Intercreditor
Agreement and, if so, the specific designation of such Intercreditor
Agreement and the rights of Potential Purchasers upon the occurrence
of a Triggering Event;
(15) whether such series will have the benefit of a Liquidity
Facility and, if so, any terms appropriate thereto;
(16) whether such series will be entitled to the benefits of a
guaranty issued by the Parent in connection with certain Leases or
Owned Aircraft Notes;
(17) whether there will be a deposit agreement or other
arrangement prior to the delivery of one or more Aircraft and, if so,
any terms appropriate thereto;
(18) the "Responsible Party" for purposes of directing the
Trustee to make Specified Investments; and
(19) any other terms of the Certificates of such series (which
terms shall not be inconsistent with the provisions of the Trust
Indenture Act), including any terms of the Certificates of such
series which may be required or advisable under United States laws or
regulations or advisable in connection with the marketing of
Certificates of the series.
(c) At any time and from time to time after the execution and
delivery of this Basic Agreement and a Trust Supplement forming a Trust and
establishing the terms of Certificates of a series, Certificates of such
series shall be executed, authenticated and delivered by the Trustee to the
Person or Persons specified by the Company upon request of the Company and
upon satisfaction or waiver of any conditions precedent set forth in such
Trust Supplement or in any other document to which a Trustee is a party
relating to the issuance of the Certificates of such series.
Section 2.02. Acquisition of Equipment Notes. (a) Unless otherwise
specified in the related Trust Supplement, on or prior to the Issuance Date
of the Certificates of a series, the Trustee shall execute and deliver the
related Note Purchase Agreements in the form delivered to the Trustee by
the Company and shall, subject to the respective terms thereof, perform its
obligations under such Note Purchase Agreements. The Trustee shall issue
and sell such Certificates, in authorized denominations and in such
Fractional Undivided Interests, so as to result in the receipt of
consideration in an amount equal to the aggregate purchase price of the
Equipment Notes contemplated to be purchased by the Trustee under the
related Note Purchase Agreements and, the Trustee shall purchase, pursuant
to the terms and conditions of the Note Purchase Agreements, such Equipment
Notes at a purchase price equal to the amount of such consideration so
received. Except as provided in Sections 3.03, 3.04 and 3.06 hereof, the
Trustee shall not execute, authenticate or deliver Certificates of such
series in excess of the aggregate amount specified in this paragraph. The
provisions of this Subsection (a) are subject to the provisions of
Subsection (b) below.
(b) If on or prior to the Issuance Date with respect to a
series of Certificates the Company shall deliver to the Trustee a
Postponement Notice relating to one or more Postponed Notes, the Trustee
shall postpone the purchase of such Postponed Notes and shall deposit into
an escrow account (as to such Trust, the "Escrow Account") to be maintained
as part of the related Trust an amount equal to the purchase price of such
Postponed Notes (the "Escrowed Funds"). The portion of the Escrowed Funds
so deposited with respect to any particular Postponed Notes shall be
invested by the Trustee at the written direction and risk of, and for the
benefit of, the Responsible Party in Specified Investments (i) maturing no
later than any scheduled Transfer Date relating to such Postponed Notes or
(ii) if no such Transfer Date has been scheduled, maturing on the next
Business Day, or (iii) if the Company has given notice to the Trustee that
such Postponed Notes will not be issued, maturing on the next applicable
Special Distribution Date, if such investments are reasonably available for
purchase. The Trustee shall make withdrawals from the Escrow Account only
as provided in this Agreement. Upon request of the Company on one or more
occasions and the satisfaction or waiver of the closing conditions
specified in the applicable Note Purchase Agreements on or prior to the
related Cut-off Date, the Trustee shall purchase the applicable Postponed
Notes with the Escrowed Funds withdrawn from the Escrow Account. The
purchase price shall equal the principal amount of such Postponed Notes.
The Trustee shall hold all Specified Investments until the maturity
thereof and will not sell or otherwise transfer Specified Investments. If
Specified Investments held in an Escrow Account mature prior to any
applicable Transfer Date, any proceeds received on the maturity of such
Specified Investments (other than any earnings thereon) shall be reinvested
by the Trustee at the written direction and risk of, and for the benefit
of, the Responsible Party in Specified Investments maturing as provided in
the preceding paragraph.
Any earnings on Specified Investments received from time to time by
the Trustee shall be promptly distributed to the Responsible Party. The
Responsible Party shall pay to the Trustee for deposit to the relevant
Escrow Account an amount equal to any losses on such Specified Investments
as incurred. On the Initial Regular Distribution Date in respect of the
Certificates of any series, the Responsible Party will pay (in immediately
available funds) to the Trustee an amount equal to the interest that
would have accrued on any Postponed Notes with respect to such
Certificates, if any, purchased after the Issuance Date if such Postponed
Notes had been purchased on the Issuance Date, from the Issuance Date to,
but not including, the date of the purchase of such Postponed Notes by the
Trustee.
If, in respect of the Certificates of any series, the Company
notifies the Trustee prior to the Cut-off Date that any Postponed Notes
will not be issued on or prior to the Cut-off Date for any reason, on the
next Special Distribution Date for such Certificates occurring not less
than 15 days following the date of such notice, (i) the Responsible Party
shall pay to the Trustee for deposit in the related Special Payments
Account, in immediately available funds, an amount equal to the interest
that would have accrued on the Postponed Notes designated in such notice at
a rate equal to the interest rate applicable to such Certificates from the
Issuance Date to, but not including, such Special Distribution Date and
(ii) the Trustee shall transfer an amount equal to that amount of Escrowed
Funds that would have been used to purchase the Postponed Notes designated
in such notice and the amount paid by the Responsible Party pursuant to the
immediately preceding clause (i) to the related Special Payments Account
for distribution as a Special Payment in accordance with the provisions
hereof.
If, on such Cut-off Date, an amount equal to less than all of the
Escrowed Funds (other than Escrowed Funds referred to in the immediately
preceding paragraph) has been used to purchase Postponed Notes, on the next
such Special Distribution Date occurring not less than 15 days following
such Cut-off Date (i) the Responsible Party shall pay to the Trustee for
deposit in such Special Payments Account, in immediately available funds,
an amount equal to the interest that would have accrued on such Postponed
Notes contemplated to be purchased with such unused Escrowed Funds (other
than Escrowed Funds referred to in the immediately preceding paragraph) but
not so purchased at a rate equal to the interest rate applicable to such
Certificates from the Issuance Date to, but not including, such Special
Distribution Date and (ii) the Trustee shall transfer such unused Escrowed
Funds and the amount paid by the Responsible Party pursuant to the
immediately preceding clause (i) to such Special Payments Account for
distribution as a Special Payment in accordance with the provisions hereof.
Section 2.03. Acceptance by Trustee. The Trustee, upon the execution
and delivery of a Trust Supplement creating a Trust and establishing a
series of Certificates, shall acknowledge its acceptance of all right,
title and interest in and to the Trust Property to be acquired pursuant to
Section 2.02 hereof and the related Note Purchase Agreements and shall
declare that the Trustee holds and will hold such right, title and interest
for the benefit of all then present and future Certificateholders of such
series, upon the trusts herein and in such Trust Supplement set forth. By
the acceptance of each Certificate of such series issued to it under this
Agreement, each initial Holder of such series as grantor of such Trust
shall thereby join in the creation and declaration of such Trust.
Section 2.04. Limitation of Powers. Each Trust shall be constituted
solely for the purpose of making the investment in the Equipment Notes
provided for in the related Trust Supplement, and, except as set forth in
this Agreement, the Trustee shall not be authorized or empowered to acquire
any other investments or engage in any other activities and, in particular,
the Trustee shall not be authorized or empowered to do anything that would
cause such Trust to fail to qualify as a "grantor trust" for federal income
tax purposes (including, as subject to this restriction, acquiring any
Aircraft (as defined in the related Indentures) by bidding such Equipment
Notes or otherwise, or taking any action with respect to any such Aircraft
once acquired).
ARTICLE III
THE CERTIFICATES
Section 3.01. Form, Denomination and Execution of Certificates. The
Certificates of each series shall be issued in fully registered form
without coupons and shall be substantially in the form attached hereto as
Exhibit A or Exhibit B, as appropriate, with such omissions, variations and
insertions as are permitted by this Agreement, and may have such letters,
numbers or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any
securities exchange on which such Certificates may be listed or to conform
to any usage in respect thereof, or as may, consistently with this
Agreement, be determined by the Trustee or the officers executing such
Certificates, as evidenced by the Trustee's or respective officers'
execution of the Certificates.
Except as provided in Section 3.05, the definitive Certificates of
such series shall be typed, printed, lithographed or engraved or produced
by any combination of these methods or may be produced in any other manner
permitted by the rules of any securities exchange on which the Certificates
may be listed, all as determined by the officers executing such
Certificates, as evidenced by their execution of such Certificates.
Except as otherwise provided in the related Trust Supplement, the
Certificates of each series shall be issued in minimum denominations of
$1,000 or integral multiples thereof except that one Certificate of such
series may be issued in a different denomination.
The Certificates of such series shall be executed on behalf of the
Trustee by manual or facsimile signature of a Responsible Officer of the
Trustee. Certificates of any series bearing the manual or facsimile
signature of an individual who was, at the time when such signature was
affixed, authorized to sign on behalf of the Trustee shall be valid and
binding obligations of the Trustee, notwithstanding that such individual
has ceased to be so authorized prior to the authentication and delivery of
such Certificates or did not hold such office at the date of such
Certificates.
Section 3.02. Authentication of Certificates. (a) On the Issuance
Date, the Trustee shall duly execute, authenticate and deliver Certificates
of each series in authorized denominations equaling in the aggregate the
aggregate principal amount of the Equipment Notes that may be purchased by
the Trustee pursuant to the related Note Purchase Agreements, and
evidencing the entire ownership of the related Trust. Thereafter, the
Trustee shall duly execute, authenticate and deliver the Certificates of
such series as provided in this Agreement.
(b) No Certificate of any series shall be entitled to any
benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially
in the form set forth in Exhibit A or Exhibit B hereto, as appropriate,
executed by the Trustee by manual signature, and such certificate of
authentication upon any Certificate shall be conclusive evidence, and the
only evidence, that such Certificate has been duly authenticated and
delivered hereunder. All Certificates of any series shall be dated the date
of their authentication.
Section 3.03. Temporary Certificates. Until definitive Certificates
are ready for delivery, the Trustee shall execute, authenticate and deliver
temporary Certificates of each series. Temporary Certificates of each
series shall be substantially in the form of definitive Certificates of
such series but may have insertions, substitutions, omissions and other
variations determined to be appropriate by the officers executing the
temporary Certificates of such series, as evidenced by their execution of
such temporary Certificates. If temporary Certificates of any series are
issued, the Trustee will cause definitive Certificates of such series to be
prepared without unreasonable delay. After the preparation of definitive
Certificates of such series, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of such temporary
Certificates at the office or agency of the Trustee designated for such
purpose pursuant to Section 7.12, without charge to the Certificateholder.
Upon surrender for cancellation of any one or more temporary Certificates,
the Trustee shall execute, authenticate and deliver in exchange therefor a
like face amount of definitive Certificates of like series, in authorized
denominations and of a like Fractional Undivided Interest. Until so
exchanged, such temporary Certificates shall be entitled to the same
benefits under this Agreement as definitive Certificates.
Section 3.04. Transfer and Exchange. The Trustee shall cause to be
kept at the office or agency to be maintained by it in accordance with the
provisions of Section 7.12 a register (the "Register") for each series of
Certificates in which, subject to such reasonable regulations as it may
prescribe, the Trustee shall provide for the registration of Certificates
of such series and of transfers and exchanges of such Certificates as
herein provided. The Trustee shall initially be the registrar (the
"Registrar") for the purpose of registering such Certificates of each
series and transfers and exchanges of such Certificates as herein provided.
All Certificates issued upon any registration of transfer or exchange
of Certificates of any series shall be valid obligations of the applicable
Trust, evidencing the same interest therein, and entitled to the same
benefits under this Agreement, as the Certificates of such series
surrendered upon such registration of transfer or exchange.
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office or such other office or agency, the Trustee shall
execute, authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Certificates of like series, in authorized
denominations of a like aggregate Fractional Undivided Interest.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of like series, in authorized denominations and of a
like aggregate Fractional Undivided Interest, upon surrender of the
Certificates to be exchanged at any such office or agency. Whenever any
Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate and deliver the Certificates that the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange shall be duly endorsed
or accompanied by a written instrument of transfer in form satisfactory to
the Trustee and the Registrar duly executed by the Certificateholder
thereof or its attorney duly authorized in writing.
No service charge shall be made to a Certificateholder for any
registration of transfer or exchange of Certificates, but the Trustee shall
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of
Certificates. All Certificates surrendered for registration of transfer or
exchange shall be cancelled and subsequently destroyed by the Trustee.
Section 3.05. Book-Entry and Definitive Certificates. (a) The
Certificates of any series may be issued in the form of one or more
typewritten Certificates representing the Book-Entry Certificates of such
series, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Company. In such case, the
Certificates of such series delivered to The Depository Trust Company shall
initially be registered on the Register in the name of CEDE & Co., the
nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's
interest in the Certificates of such series, except as provided above and
in Subsection (d) below. As to the Certificates of any series, unless and
until definitive, fully registered Certificates (the "Definitive
Certificates") have been issued pursuant to Subsection (d) below:
(i) the provisions of this Section 3.05 shall be in full
force and effect;
(ii) the Company, the Paying Agent, the Registrar and the
Trustee may deal with the Clearing Agency Participants for all
purposes (including the making of distributions on the
Certificates) as the authorized representatives of the
Certificate Owners;
(iii) to the extent that the provisions of this Section
3.05 conflict with any other provisions of this Agreement
(other than the provisions of any Trust Supplement expressly
amending this Section 3.05 as permitted by this Basic
Agreement), the provisions of this Section 3.05 shall control;
(iv) the rights of Certificate Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Certificate
Owners and the Clearing Agency Participants; and until
Definitive Certificates are issued pursuant to Subsection (d)
below, the Clearing Agency will make book-entry transfers among
the Clearing Agency Participants and receive and transmit
distributions of principal, interest and premium, if any, on
the Certificates to such Clearing Agency Participants; and
(v) whenever this Agreement requires or permits actions
to be taken based upon instructions or directions of
Certificateholders of such series holding Certificates of such
series evidencing a specified percentage of the Fractional
Undivided Interests in the related Trust, the Clearing Agency
shall be deemed to represent such percentage only to the extent
that it has received instructions to such effect from Clearing
Agency Participants owning or representing, respectively, such
required percentage of the beneficial interest in Certificates
of such series and has delivered such instructions to the
Trustee. The Trustee shall have no obligation to determine
whether the Clearing Agency has in fact received any such
instructions.
(b) Whenever notice or other communication to the
Certificateholders of such series is required under this Agreement, unless
and until Definitive Certificates shall have been issued pursuant to
Subsection (d) below, the Trustee shall give all such notices and
communications specified in this Agreement to be given to
Certificateholders of such series to the Clearing Agency.
(c) Unless and until Definitive Certificates of a series are
issued pursuant to Subsection (d) below, on the Record Date prior to each
applicable Regular Distribution Date and Special Distribution Date, the
Trustee will request from the Clearing Agency a securities position listing
setting forth the names of all Clearing Agency Participants reflected on
the Clearing Agency's books as holding interests in the Certificates on
such Record Date.
(d) If with respect to the Certificates of any series (i) the
Company advises the Trustee in writing that the Clearing Agency is no
longer willing or able to discharge properly its responsibilities and the
Trustee or the Company is unable to locate a qualified successor, (ii) the
Company, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after
the occurrence of an Event of Default, Certificate Owners of Book-Entry
Certificates of such series evidencing Fractional Undivided Interests
aggregating not less than a majority in interest in the related Trust, by
Act of such Certificate Owners delivered to the Company and the Trustee,
advise the Company, the Trustee and the Clearing Agency through the
Clearing Agency Participants in writing that the continuation of a
book-entry system through the Clearing Agency Participants is no longer in
the best interests of the Certificate Owners of such series, then the
Trustee shall notify all Certificate Owners of such series, through the
Clearing Agency, of the occurrence of any such event and of the
availability of Definitive Certificates. Upon surrender to the Trustee of
all the Certificates of such series held by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency
Participants for registration of Definitive Certificates in the names of
Certificate Owners of such series, the Trustee shall issue and deliver the
Definitive Certificates of such series in accordance with the instructions
of the Clearing Agency. None of the Company, the Parent, the Registrar, the
Paying Agent or the Trustee shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected in
relying on, such registration instructions. Upon the issuance of Definitive
Certificates of such series, the Trustee shall recognize the Person in
whose name the Definitive Certificates are registered in the Register as
Certificateholders under this Agreement. None of the Company, the Parent or
the Trustee shall be liable if the Trustee or the Company is unable to
locate a qualified successor Clearing Agency.
(e) Except as otherwise provided in the related Trust
Supplement, the Trustee shall enter into the applicable Letter of
Representations with respect to such series of Certificates and fulfill its
responsibilities thereunder.
(f) The provisions of this Section 3.05 may be made
inapplicable to any series or may be amended with respect to any series in
the related Trust Supplement.
Section 3.06. Mutilated, Destroyed, Lost or Stolen
Certificates. If (a) any mutilated Certificate is surrendered to the
Registrar, or the Registrar receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate, and (b) there is delivered
to the Registrar and the Trustee such security, indemnity or bond, as may
be required by them to save each of them harmless, then, in the absence of
notice to the Registrar or the Trustee that such destroyed, lost or stolen
Certificate has been acquired by a bona fide purchaser, and provided,
however, that the requirements of Section 8-405 of the Uniform Commercial
Code in effect in any applicable jurisdiction are met, the Trustee shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate or
Certificates of like series, in authorized denominations and of like
Fractional Undivided Interest and bearing a number not contemporaneously
outstanding.
In connection with the issuance of any new Certificate under this
Section 3.06, the Trustee shall require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the
Trustee and the Registrar) connected therewith.
Any duplicate Certificate issued pursuant to this Section 3.06 shall
constitute conclusive evidence of the appropriate Fractional Undivided
Interest in the related Trust, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.
The provisions of this Section 3.06 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen
Certificates.
Section 3.07. Persons Deemed Owners. Prior to due presentment of a
Certificate for registration of transfer, the Trustee, the Registrar and
any Paying Agent may treat the Person in whose name any Certificate is
registered (as of the day of determination) as the owner of such
Certificate for the purpose of receiving distributions pursuant to Article
IV and for all other purposes whatsoever, and none of the Trustee, the
Registrar or any Paying Agent shall be affected by any notice to the
contrary.
Section 3.08. Cancellation. All Certificates surrendered for payment
or transfer or exchange shall, if surrendered to the Trustee or any agent
of the Trustee other than the Registrar, be delivered to the Registrar for
cancellation and shall promptly be cancelled by it. No Certificates shall
be authenticated in lieu of or in exchange for any Certificates cancelled
as provided in this Section 3.08, except as expressly permitted by this
Agreement. All cancelled Certificates held by the Registrar shall be
destroyed and a certification of their destruction delivered to the
Trustee.
Section 3.09. Limitation of Liability for Payments. All payments and
distributions made to Certificateholders of any series in respect of the
Certificates of such series shall be made only from the Trust Property of
the related Trust and only to the extent that the Trustee shall have
sufficient income or proceeds from such Trust Property to make such
payments in accordance with the terms of Article IV of this Agreement. Each
Certificateholder, by its acceptance of a Certificate, agrees that it will
look solely to the income and proceeds from the Trust Property of the
related Trust for any payment or distribution due to such Certificateholder
pursuant to the terms of this Agreement and that it will not have any
recourse to the Company, the Parent, the Trustee, the Loan Trustees, the
Owner Trustees or the Owner Participants, except as otherwise expressly
provided in this Agreement or in the related Intercreditor Agreement.
Each of the Company and the Parent is a party to this Agreement
solely for purposes of meeting the requirements of the Trust Indenture Act,
and therefore neither the Company nor the Parent shall have any right,
obligation or liability hereunder (except as otherwise expressly provided
herein).
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
Section 4.01. Certificate Account and Special Payments Account. (a)
The Trustee shall establish and maintain on behalf of the
Certificateholders of each series a Certificate Account as one or more
non-interest-bearing accounts. The Trustee shall hold such Certificate
Account in trust for the benefit of the Certificateholders of such series,
and shall make or permit withdrawals therefrom only as provided in this
Agreement. On each day when a Scheduled Payment is made to the Trustee
(under an Intercreditor Agreement, if applicable) with respect to the
Certificates of such series, the Trustee, upon receipt thereof, shall
immediately deposit the aggregate amount of such Scheduled Payment in such
Certificate Account.
(b) The Trustee shall establish and maintain on behalf of the
Certificateholders of each series a Special Payments Account as one or more
accounts, which shall be non-interest bearing except as provided in Section
4.04. The Trustee shall hold the Special Payments Account in trust for the
benefit of the Certificateholders of such series and shall make or permit
withdrawals therefrom only as provided in this Agreement. On each day when
one or more Special Payments are made to the Trustee (under an
Intercreditor Agreement, if applicable) with respect to the Certificates of
such series, the Trustee, upon receipt thereof, shall immediately deposit
the aggregate amount of such Special Payments in such Special Payments
Account.
(c) The Trustee shall present (or, if applicable, cause the
Subordination Agent to present) to the related Loan Trustee of each
Equipment Note such Equipment Note on the date of its stated final maturity
or, in the case of any Equipment Note which is to be redeemed in whole
pursuant to the related Indenture, on the applicable redemption date under
such Indenture.
Section 4.02. Distributions from Certificate Account and Special
Payments Account. (a) On each Regular Distribution Date with respect to a
series of Certificates or as soon thereafter as the Trustee has confirmed
receipt of the payment of all or any part of the Scheduled Payments due on
the Equipment Notes held (subject to the Intercreditor Agreement) in the
related Trust on such date, the Trustee shall distribute out of the
applicable Certificate Account the entire amount deposited therein pursuant
to Section 4.01(a). There shall be so distributed to each Certificateholder
of record of such series on the Record Date with respect to such Regular
Distribution Date (other than as provided in Section 11.01 concerning the
final distribution) by check mailed to such Certificateholder, at the
address appearing in the Register, such Certificateholder's pro rata share
(based on the Fractional Undivided Interest in the Trust held by such
Certificateholder) of the total amount in the applicable Certificate
Account, except that, with respect to Certificates registered on the Record
Date in the name of a Clearing Agency (or its nominee), such distribution
shall be made by wire transfer in immediately available funds to the
account designated by such Clearing Agency (or such nominee).
(b) On each Special Distribution Date with respect to any
Special Payment with respect to a series of Certificates or as soon
thereafter as the Trustee has confirmed receipt of any Special Payments due
on the Equipment Notes held (subject to the Intercreditor Agreement) in the
related Trust or realized upon the sale of such Equipment Notes, the
Trustee shall distribute out of the applicable Special Payments Account the
entire amount of such applicable Special Payment deposited therein pursuant
to Section 4.01(b). There shall be so distributed to each Certificateholder
of record of such series on the Record Date with respect to such Special
Distribution Date (other than as provided in Section 11.01 concerning the
final distribution) by check mailed to such Certificateholder, at the
address appearing in the Register, such Certificateholder's pro rata share
(based on the Fractional Undivided Interest in the related Trust held by
such Certificateholder) of the total amount in the applicable Special
Payments Account on account of such Special Payment, except that, with
respect to Certificates registered on the Record Date in the name of a
Clearing Agency (or its nominee), such distribution shall be made by wire
transfer in immediately available funds to the account designated by such
Clearing Agency (or such nominee).
(c) The Trustee shall, at the expense of the Company, cause
notice of each Special Payment with respect to a series of Certificates to
be mailed to each Certificateholder of such series at his address as it
appears in the Register. In the event of redemption or purchase of
Equipment Notes held in the related Trust, such notice shall be mailed not
less than 15 days prior to the Special Distribution Date for the Special
Payment resulting from such redemption or purchase, which Special
Distribution Date shall be the date of such redemption or purchase. In the
event that the Trustee receives a notice from the Company that Postponed
Notes will not be purchased by the Trustee pursuant to Section 2.02, such
notice of Special Payment shall be mailed as soon as practicable after
receipt of such notice from the Company and shall state the Special
Distribution Date for such Special Payment, which shall occur 15 days after
the date of such notice of Special Payment or (if such 15th day is not
practicable) as soon as practicable thereafter. In the event that any
Special Payment is to be made pursuant to the last paragraph of Section
2.02(b) hereof, there shall be mailed on the Cut-off Date (or, if such
mailing on the Cut-off Date is not practicable, as soon as practicable
after the Cut-off Date), notice of such Special Payment stating the Special
Distribution Date for such Special Payment, which shall occur 15 days after
the date of such notice of such Special Payment (or, if such 15th day is
not practicable, as soon as practicable thereafter). In the case of any
other Special Payments, such notice shall be mailed as soon as practicable
after the Trustee has confirmed that it has received funds for such Special
Payment, stating the Special Distribution Date for such Special Payment
which shall occur not less than 15 days after the date of such notice and
as soon as practicable thereafter. Notices mailed by the Trustee shall set
forth:
(i) the Special Distribution Date and the Record Date
therefor (except as otherwise provided in Section 11.01),
(ii) the amount of the Special Payment (taking into
account any payment to be made by the Company pursuant to
Section 2.02(b)) for each $1,000 face amount Certificate and
the amount thereof constituting principal, premium, if any, and
interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as
a Regular Distribution Date for the Certificates of such
series, the total amount to be received on such date for each
$1,000 face amount Certificate.
If the amount of premium, if any, payable upon the redemption or purchase
of an Equipment Note has not been calculated at the time that the Trustee
mails notice of a Special Payment, it shall be sufficient if the notice
sets forth the other amounts to be distributed and states that any premium
received will also be distributed.
If any redemption of the Equipment Notes held in any Trust is
cancelled, the Trustee, as soon as possible after learning thereof, shall
cause notice thereof to be mailed to each Certificateholder of the related
series at its address as it appears on the Register.
Section 4.03. Statements to Certificateholders. (a) On each Regular
Distribution Date and Special Distribution Date, the Trustee will include
with each distribution of a Scheduled Payment or Special Payment, as the
case may be, to Certificateholders of the related series a statement
setting forth the information provided below. Such statement shall set
forth (per $1,000 aggregate principal amount of Certificate as to (i) and
(ii) below) the following information:
(i) the amount of such distribution under this Agreement
allocable to principal and the amount allocable to premium, if
any;
(ii) the amount of such distribution under this Agreement
allocable to interest; and
(iii) the Pool Balance and the Pool Factor of the related
Trust.
With respect to the Certificates registered in the name of a Clearing
Agency or its nominee, on the Record Date prior to each Distribution Date,
the Trustee will request from the Clearing Agency a securities position
listing setting forth the names of all the Clearing Agency Participants
reflected on the Clearing Agency's books as holding interests in the
Certificates on such Record Date. On each Distribution Date, the applicable
Trustee will mail to each such Clearing Agency Participant the statement
described above and will make available additional copies as requested by
such Clearing Agency Participant for forwarding to holders of interests in
the Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the
Trustee shall furnish to each Person who at any time during such calendar
year was a Certificateholder of record a statement containing the sum of
the amounts determined pursuant to clauses (a)(i) and (a)(ii) above with
respect to the related Trust for such calendar year or, in the event such
Person was a Certificateholder of record during a portion of such calendar
year, for the applicable portion of such year, and such other items as are
readily available to the Trustee and which a Certificateholder shall
reasonably request as necessary for the purpose of such Certificateholder's
preparation of its federal income tax returns. With respect to Certificates
registered in the name of a Clearing Agency or its nominee, such statement
and such other items shall be prepared on the basis of information supplied
to the Trustee by the Clearing Agency Participants and shall be delivered
by the Trustee to such Clearing Agency Participants to be available for
forwarding by such Clearing Agency Participants to the holders of interests
in the Certificates in the manner described in Section 4.03(a).
Section 4.04. Investment of Special Payment Moneys. Any money
received by the Trustee pursuant to Section 4.01(b) representing a Special
Payment which is not distributed on the date received shall, to the extent
practicable, be invested by the Trustee in Permitted Investments selected
by the Company in written instructions to the Trustee pending distribution
of such Special Payment pursuant to Section 4.02. Absent receipt of such
instructions from the Company, such Special Payment shall remain uninvested
by the Trustee pending receipt of written investment instructions. Any
investment made pursuant to this Section 4.04 shall be in such Permitted
Investments having maturities not later than the date that such moneys are
required to be used to make the payment required under Section 4.02 on the
applicable Special Distribution Date and the Trustee shall hold any such
Permitted Investments until maturity. The Trustee shall have no liability
with respect to any investment made pursuant to this Section 4.04, other
than by reason of the willful misconduct or negligence of the Trustee. All
income and earnings from such investments shall be distributed on such
Special Distribution Date as part of such Special Payment.
ARTICLE V
THE COMPANY
Section 5.01. Maintenance of Corporate Existence. The Company, at its
own cost and expense, will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, rights
and franchises, except as otherwise specifically permitted in Section 5.02;
provided, however, that the Company shall not be required to preserve any
right or franchise if the Company shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the
Company.
Section 5.02. Consolidation, Merger, Etc. The Company shall not
consolidate with or merge into any other corporation or convey, transfer or
lease substantially all of its assets as an entirety to any Person unless:
(a) the corporation formed by such consolidation or into
which the Company is merged or the Person that acquires by
conveyance, transfer or lease substantially all of the assets of the
Company as an entirety shall be (i) organized and validly existing
under the laws of the United States of America or any state thereof
or the District of Columbia, (ii) a "citizen of the United States" as
defined in 49 U.S.C. ss.ss. 40102(a)(15), as amended, and (iii) a
United States certificated air carrier, if and so long as such status
is a condition of entitlement to the benefits of Section 1110 of the
Bankruptcy Reform Act of 1978, as amended (11 U.S.C. ss.ss. 1110),
with respect to the Leases or the Aircraft owned by the Company;
(b) the corporation formed by such consolidation or into
which the Company is merged or the Person which acquires by
conveyance, transfer or lease substantially all of the assets of the
Company as an entirety shall execute and deliver to the Trustee
applicable to the Certificates of each series a duly authorized,
valid, binding and enforceable agreement in form and substance
reasonably satisfactory to the Trustee containing an assumption by
such successor corporation or Person of the due and punctual
performance and observance of each covenant and condition of the Note
Documents and of this Agreement applicable to the Certificates of
each series to be performed or observed by the Company; and
(c) the Company shall have delivered to the Trustee an
Officer's Certificate of the Company and an Opinion of Counsel of the
Company (that may be the Company's General Counsel, Deputy General
Counsel, Associate General Counsel or other senior attorney of the
Company) reasonably satisfactory to the Trustee, each stating that
such consolidation, merger, conveyance, transfer or lease and the
assumption agreement mentioned in clause (b) above comply with this
Section 5.02 and that all conditions precedent herein provided for
relating to such transaction have been complied with.
Upon any consolidation or merger, or any conveyance, transfer or
lease of substantially all of the assets of the Company as an entirety in
accordance with this Section 5.02, the successor corporation or Person
formed by such consolidation or into which the Company is merged or to
which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company
under this Agreement applicable to the Certificates of each series with the
same effect as if such successor corporation or Person had been named as
the Company herein. No such conveyance, transfer or lease of substantially
all of the assets of the Company as an entirety shall have the effect of
releasing any successor corporation or Person which shall have become such
in the manner prescribed in this Section 5.02 from its liability in respect
of this Agreement and any Note Document applicable to the Certificates of
such series to which it is a party.
ARTICLE VI
DEFAULT
Section 6.01. Indenture Events of Default and Triggering Events. (a)
Upon the occurrence and during the continuation of any Indenture Event of
Default under any Indenture, the Trustee may (i) to the extent it is the
Controlling Party at such time (as determined pursuant to the related
Intercreditor Agreement), direct the exercise of remedies as provided in
such related Intercreditor Agreement and (ii) if there is no related
Intercreditor Agreement, direct the exercise of remedies or take other
action as provided in the relevant Indenture to the extent that it may do
so as the holder of the Equipment Notes issued under such Indenture and
held in the related Trust.
(b) By acceptance of its Certificate, each Certificateholder
agrees that at any time after the occurrence and during the continuation of
a Triggering Event, each Certificateholder of Certificates of certain
series (each, a "Potential Purchaser" and, collectively, the "Potential
Purchasers") will have certain rights to purchase the Certificates of one
or more other series, all as set forth in the Trust Supplement applicable
to the Certificates held by such Potential Purchaser. The purchase price
with respect to the Certificates of any series shall be equal to the Pool
Balance of the Certificates of such series, together with accrued and
unpaid interest thereon to the date of such purchase, without premium, but
including any other amounts then due and payable to the Certificateholders
of such series under this Agreement, any related Intercreditor Agreement or
any other Note Document or on or in respect of the Certificates of such
series; provided, however, that if such purchase occurs after a Record
Date, such purchase price shall be reduced by the amount to be distributed
under this Agreement on the related Distribution Date (which deducted
amounts shall remain distributable to, and may be retained by, the
Certificateholder as of such Record Date); provided, further, that no such
purchase of Certificates of such series shall be effective unless the
purchasing Certificateholder (each, a "Purchasing Certificateholder" and,
collectively, the "Purchasing Certificateholders") shall certify to the
Trustee that contemporaneously with such purchase, one or more Purchasing
Certificateholders are purchasing, pursuant to the terms of this Agreement
and the other Agreements, if any, relating to the Certificates of a series
that are subject to the same Intercreditor Agreement (such other
Agreements, the "Other Agreements"), the Certificates of each such series
that the Trust Supplement applicable to the Certificates held by the
Purchasing Certificateholder specifies may be purchased by such Purchasing
Certificateholder. Each payment of the purchase price of the Certificates
of any series shall be made to an account or accounts designated by the
Trustee and each such purchase shall be subject to the terms of this
Section 6.01. By acceptance of its Certificate, each Certificateholder
(each, a "Selling Certificateholder" and, collectively, the "Selling
Certificateholders") of a series that is subject to purchase by Potential
Purchasers, all as set forth in the Trust Supplement applicable to the
Certificates held by the Selling Certificateholders, agrees that, at any
time after the occurrence and during the continuance of a Triggering Event,
it will, upon payment of the purchase price specified in this Agreement by
one or more Purchasing Certificateholders, forthwith sell, assign, transfer
and convey to such Purchasing Certificateholder (without recourse,
representation or warranty of any kind except for its own acts), all of the
right, title, interest and obligation of such Selling Certificateholder in
this Agreement, any related Intercreditor Agreement, the related Liquidity
Facility, the related Note Documents and all Certificates of such series
held by such Selling Certificateholder (excluding all right, title and
interest under any of the foregoing to the extent such right, title or
interest is with respect to an obligation not then due and payable as
respects any action or inaction or state of affairs occurring prior to such
sale) and the Purchasing Certificateholder shall assume all of such Selling
Certificateholder's obligations under this Agreement, any related
Intercreditor Agreement, the related Liquidity Facility and the related
Note Documents. The Certificates of such series will be deemed to be
purchased on the date payment of the purchase price is made notwithstanding
the failure of any Selling Certificateholder to deliver any Certificates of
such series and, upon such a purchase, (i) the only rights of the Selling
Certificateholders will be to deliver the Certificates to the Purchasing
Certificateholder and receive the purchase price for such Certificates of
such series and (ii) if the Purchasing Certificateholder shall so request,
such Selling Certificateholder will comply with all of the provisions of
Section 3.04 hereof to enable new Certificates of such series to be issued
to the Purchasing Certificateholder in such denominations as it shall
request. All charges and expenses in connection with the issuance of any
such new Certificates shall be borne by the Purchasing Certificateholder.
Section 6.02. Incidents of Sale of Equipment Notes. Upon any sale of
all or any part of the Equipment Notes held in the Trust made either under
the power of sale given under this Agreement or otherwise for the
enforcement of this Agreement, the following shall be applicable:
(1) Certificateholders and Trustee May Purchase Equipment
Notes. Any Certificateholder, the Trustee in its individual or any
other capacity or any other Person may bid for and purchase any of
the Equipment Notes held in the Trust, and upon compliance with the
terms of sale, may hold, retain, possess and dispose of such
Equipment Notes in their own absolute right without further
accountability.
(2) Receipt of Trustee Shall Discharge Purchaser. The receipt
of the Trustee making such sale shall be a sufficient discharge to
any purchaser for his purchase money, and, after paying such purchase
money and receiving such receipt, such purchaser or its personal
representative or assigns shall not be obliged to see to the
application of such purchase money, or be in any way answerable for
any loss, misapplication or non-application thereof.
(3) Application of Moneys Received Upon Sale. Any moneys
collected by the Trustee upon any sale made either under the power of
sale given by this Agreement or otherwise for the enforcement of this
Agreement shall be applied as provided in Section 4.02.
Section 6.03. Judicial Proceedings Instituted by Trustee; Trustee May
Bring Suit. If there shall be a failure to make payment of the principal
of, premium, if any, or interest on any Equipment Note held in the related
Trust, or if there shall be any failure to pay Rent (as defined in the
relevant Lease) under any Lease when due and payable, then the Trustee, in
its own name and as trustee of an express trust, as holder of such
Equipment Notes, to the extent permitted by and in accordance with the
terms of any related Intercreditor Agreement and any related Note Documents
(subject to rights of the applicable Owner Trustee or Owner Participant to
cure any such failure to pay principal of, premium, if any, or interest on
any Equipment Note or to pay Rent under any Lease in accordance with the
applicable Indenture), shall be entitled and empowered to institute any
suits, actions or proceedings at law, in equity or otherwise, for the
collection of the sums so due and unpaid on such Equipment Notes or under
such Lease and may prosecute any such claim or proceeding to judgment or
final decree with respect to the whole amount of any such sums so due and
unpaid.
Section 6.04. Control by Certificateholders. Subject to Section 6.03
and any related Intercreditor Agreement, the Certificateholders holding
Certificates of a series evidencing Fractional Undivided Interests
aggregating not less than a majority in interest in the related Trust shall
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee with respect to such
Trust or pursuant to the terms of such Intercreditor Agreement, or
exercising any trust or power conferred on the Trustee under this Agreement
or such Intercreditor Agreement, including any right of the Trustee as
Controlling Party under such Intercreditor Agreement or as holder of the
Equipment Notes held in the related Trust; provided, however, that
(1) such Direction shall not in the opinion of the Trustee be
in conflict with any rule of law or with this Agreement and would not
involve the Trustee in personal liability or expense,
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Certificateholders of such
series not taking part in such Direction, and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such Direction.
Section 6.05. Waiver of Past Defaults. Subject to any related
Intercreditor Agreement, the Certificateholders holding Certificates of a
series evidencing Fractional Undivided Interests aggregating not less than
a majority in interest in the Trust (i) may on behalf of all of the
Certificateholders waive any past Event of Default under this Agreement and
its consequences or (ii) if the Trustee is the Controlling Party, may
direct the Trustee to instruct the applicable Loan Trustee to waive any
past Indenture Event of Default under any related Indenture and its
consequences, and thereby annul any Direction given by such
Certificateholders or the Trustee to such Loan Trustee with respect
thereto, except a default:
(1) in the deposit of any Scheduled Payment or Special Payment
under Section 4.01 or in the distribution of any payment under
Section 4.02 on the Certificates of a series, or
(2) in the payment of the principal of (premium, if any) or
interest on the Equipment Notes held in the related Trust, or
(3) in respect of a covenant or provision hereof which under
Article IX hereof cannot be modified or amended without the consent
of each Certificateholder holding an Outstanding Certificate of a
series affected thereby.
Upon any such waiver, such default shall cease to exist with respect to the
Certificates of such series and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose and any direction
given by the Trustee on behalf of the Certificateholders of such series to
the relevant Loan Trustee shall be annulled with respect thereto; but no
such waiver shall extend to any subsequent or other default or Event of
Default or impair any right consequent thereon. Upon any such waiver, the
Trustee shall vote the Equipment Notes issued under the relevant Indenture
to waive the corresponding Indenture Event of Default.
Section 6.06. Right of Certificateholders to Receive Payments Not to
Be Impaired. Anything in this Agreement to the contrary notwithstanding,
including, without limitation, Section 6.07 hereof, but subject to any
related Intercreditor Agreement, the right of any Certificateholder to
receive distributions of payments required pursuant to Section 4.02 hereof
on the applicable Certificates when due, or to institute suit for the
enforcement of any such payment on or after the applicable Regular
Distribution Date or Special Distribution Date, shall not be impaired or
affected without the consent of such Certificateholder.
Section 6.07. Certificateholders May Not Bring Suit Except Under
Certain Conditions. A Certificateholder of any series shall not have the
right to institute any suit, action or proceeding at law or in equity or
otherwise with respect to this Agreement, for the appointment of a receiver
or for the enforcement of any other remedy under this Agreement, unless:
(1) such Certificateholder previously shall have given written
notice to the Trustee of a continuing Event of Default;
(2) Certificateholders holding Certificates of such series
evidencing Fractional Undivided Interests aggregating not less than
25% of the related Trust shall have requested the Trustee in writing
to institute such action, suit or proceeding and shall have offered
to the Trustee indemnity as provided in Section 7.03(e);
(3) the Trustee shall have refused or neglected to institute
any such action, suit or proceeding for 60 days after receipt of such
notice, request and offer of indemnity; and
(4) no direction inconsistent with such written request shall
have been given to the Trustee during such 60-day period by
Certificateholders holding Certificates of such series evidencing
Fractional Undivided Interests aggregating not less than a majority
in interest in the related Trust.
It is understood and intended that no one or more of the
Certificateholders of any series shall have any right in any manner
whatsoever hereunder or under the related Trust Supplement or under the
Certificates of such series to (i) surrender, impair, waive, affect,
disturb or prejudice any property in the Trust Property of the related
Trust, or the lien of any related Indenture on any property subject
thereto, or the rights of the Certificateholders of such series or the
holders of the related Equipment Notes, (ii) obtain or seek to obtain
priority over or preference with respect to any other such
Certificateholder of such series or (iii) enforce any right under this
Agreement, except in the manner provided in this Agreement and for the
equal, ratable and common benefit of all the Certificateholders of such
series subject to the provisions of this Agreement.
Section 6.08. Remedies Cumulative. Every remedy given under this
Agreement to the Trustee or to any of the Certificateholders of any series
shall not be exclusive of any other remedy or remedies, and every such
remedy shall be cumulative and in addition to every other remedy given
under this Agreement or now or hereafter given by statute, law, equity or
otherwise.
Section 6.09. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Agreement, or in any suit against the
Trustee for any action taken, suffered or omitted by it as Trustee, a court
may require any party litigant in such suit to file an undertaking to pay
the costs of such suit, and may assess costs against any such party
litigant, in the manner and to the extent provided in the Trust Indenture
Act; provided, however, that neither this Section 6.09 nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the
Company or the Parent.
ARTICLE VII
THE TRUSTEE
Section 7.01. Certain Duties and Responsibilities. (a) Except during
the continuance of an Event of Default in respect of a Trust, the Trustee
undertakes to perform such duties in respect of such Trust as are
specifically set forth in this Agreement, and no implied covenants or
obligations shall be read into this Agreement against the Trustee.
(b) In case an Event of Default in respect of a Trust has
occurred and is continuing, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement in respect of such Trust, and use
the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(c) No provision of this Agreement shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that
(1) this Subsection shall not be construed to limit the effect
of Subsection (a) of this Section 7.01; and
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Trustee, unless it
shall be proved that the Trustee was negligent in ascertaining the
pertinent facts.
(d) Whether or not herein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be subject to the
provisions of this Section 7.01.
Section 7.02. Notice of Defaults. (a) As promptly as practicable
after, and in any event within 90 days after, the occurrence of any default
(as such term is defined below) hereunder known to the Trustee, the Trustee
shall transmit by mail to the Company, any related Owner Trustees, any
related Owner Participants, the related Loan Trustees and the
Certificateholders holding Certificates of the related series in accordance
with Section 313(c) of the Trust Indenture Act, notice of such default
hereunder known to the Trustee, unless such default shall have been cured
or waived; provided, however, that, except in the case of a default in the
payment of the principal, premium, if any, or interest on any Equipment
Note, the Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Trustee in good
faith shall determine that the withholding of such notice is in the
interests of the Certificateholders of the related series. For the purpose
of this Section 7.02 in respect of any Trust, the term "Default" means any
event that is, or after notice or lapse of time or both would become, an
Event of Default in respect of that Trust.
(b) The Trustee shall not be deemed to have knowledge of any
Default unless a Responsible Officer of the Trustee shall have received
written notice of such Default; provided, however, that the Trustee shall
be deemed to have notice of any failure to receive Scheduled Payments under
this Agreement.
Section 7.03. Certain Rights of Trustee. Subject to the provisions
of Section 315 of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting
or refraining from acting in reliance upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture or other paper or document
believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Request;
(c) whenever in the administration of this Agreement or
any Intercreditor Agreement, the Trustee shall deem it desirable that
a matter be proved or established prior to taking, suffering or
omitting any action hereunder, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on
its part, rely upon an Officer's Certificate of the Company or the
Parent, any related Owner Trustee or any related Loan Trustee;
(d) the Trustee may consult with counsel and the advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement or any
Intercreditor Agreement at the Direction of any of the
Certificateholders pursuant to this Agreement or any Intercreditor
Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the cost, expenses
and liabilities which might be incurred by it in compliance with such
Direction;
(f) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture or other paper or
document;
(g) the Trustee may execute any of the trusts or powers
under this Agreement or any Intercreditor Agreement or perform any
duties under this Agreement or any Intercreditor Agreement either
directly or by or through agents or attorneys, and the Trustee shall
not be responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it under this
Agreement or any Intercreditor Agreement;
(h) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the Direction of the Certificateholders holding Certificates of
any series evidencing Fractional Undivided Interests aggregating not
less than a majority in interest in the related Trust relating to the
time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Agreement or any Intercreditor
Agreement; and
(i) the Trustee shall not be required to expend or risk
its own funds in the performance of any of its duties under this
Agreement, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk is not reasonably
assured to it.
Section 7.04. Not Responsible for Recitals or Issuance of
Certificates. The recitals contained herein and in the Certificates of each
series, except the certificates of authentication, shall not be taken as
the statements of the Trustee, and the Trustee assumes no responsibility
for their correctness. Subject to Section 7.15, the Trustee makes no
representations as to the validity or sufficiency of this Basic Agreement,
any Equipment Notes, any Intercreditor Agreement, the Certificates of any
series, any Trust Supplement or any Note Documents, except that the Trustee
hereby represents and warrants that this Basic Agreement has been, and each
Trust Supplement, each Certificate, each Note Purchase Agreement and each
Intercreditor Agreement of, or relating to, each series will be executed
and delivered by one of its officers who is duly authorized to execute and
deliver such document on its behalf.
Section 7.05. May Hold Certificates. The Trustee, any Paying Agent,
Registrar or any of their Affiliates or any other agent, in their
respective individual or any other capacity, may become the owner or
pledgee of Certificates and, subject to Sections 310(b) and 311 of the
Trust Indenture Act, if applicable, may otherwise deal with the Company,
the Parent, any Owner Trustees or the Loan Trustees with the same rights it
would have if it were not Trustee, Paying Agent, Registrar or such other
agent.
Section 7.06. Money Held in Trust. Money held by the Trustee or the
Paying Agent in trust under this Agreement need not be segregated from
other funds except to the extent required in this Agreement or by law and
neither the Trustee nor the Paying Agent shall have any liability for
interest upon any such moneys except as provided for in this Agreement.
Section 7.07. Compensation and Reimbursement. The Company
agrees:
(1) to pay, or cause to be paid, to the Trustee from time to
time reasonable compensation for all services rendered by it under
this Agreement (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an
express trust); and
(2) except as otherwise expressly provided herein or in any
Trust Supplement, to reimburse, or cause to be reimbursed, the
Trustee upon its request for all reasonable out-of-pocket expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Basic Agreement, any Trust
Supplement or any Intercreditor Agreement (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its negligence, willful misconduct or bad
faith or as may be incurred due to the Trustee's breach of its
representations and warranties set forth in Section 7.15; and
(3) to indemnify, or cause to be indemnified, the Trustee with
respect to the Certificates of any series, pursuant to the particular
sections of the Note Purchase Agreement specified in the related
Trust Supplement.
The Trustee shall be entitled to reimbursement from, and shall have a
lien prior to the Certificates of each series upon, all property and funds
held or collected by the Trustee in its capacity as Trustee with respect to
such series or the related Trust for any tax incurred without negligence,
bad faith or willful misconduct, on its part, arising out of or in
connection with the acceptance or administration of such Trust (other than
any tax attributable to the Trustee's compensation for serving as such),
including any costs and expenses incurred in contesting the imposition of
any such tax. The Trustee shall notify the Company of any claim for any tax
for which it may seek reimbursement. If the Trustee reimburses itself from
the Trust Property of such Trust for any such tax, it will mail a brief
report within 30 days setting forth the amount of such tax and the
circumstances thereof to all Certificateholders of such series as their
names and addresses appear in the Register.
Section 7.08. Corporate Trustee Required; Eligibility. Each Trust
shall at all times have a Trustee which shall be eligible to act as a
trustee under Section 310(a) of the Trust Indenture Act and shall have a
combined capital and surplus of at least $75,000,000 (or a combined capital
and surplus in excess of $5,000,000 and the obligations of which, whether
now in existence or hereafter incurred, are fully and unconditionally
guaranteed by a corporation organized and doing business under the laws of
the United States, any state or territory thereof or of the District of
Columbia and having a combined capital and surplus of at least
$75,000,000). If such corporation publishes reports of conditions at least
annually, pursuant to law or to the requirements of federal, state,
territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section 7.08 the combined capital and surplus
of such corporation shall be deemed to be its combined capital and surplus
as set forth in its most recent report of conditions so published.
In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 7.08 to act as Trustee of
any Trust, the Trustee shall resign immediately as Trustee of such Trust in
the manner and with the effect specified in Section 7.09.
Section 7.09. Resignation and Removal, Appointment of Successor. (a)
No resignation or removal of the Trustee and no appointment of a successor
Trustee of any Trust pursuant to this Article shall become effective until
the acceptance of appointment by the successor Trustee under Section 7.10.
(b) The Trustee may resign at any time as Trustee of any or all
Trusts by giving prior written notice thereof to the Company, the
Authorized Agents, the related Owner Trustees and the related Loan
Trustees. If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Company, the related Owner Trustees and the
Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Direction of the
Certificateholders of the related series holding Certificates evidencing
Fractional Undivided Interests aggregating not less than a majority in
interest in such Trust delivered to the Trustee and to the Company, the
related Owner Trustees and the related Loan Trustees.
(d) If at any time in respect of any Trust:
(1) the Trustee shall fail to comply with Section 310 of the
Trust Indenture Act, if applicable, after written request therefor by
the Company or by any Certificateholder who has been a bona fide
Certificateholder for at least six months; or
(2) the Trustee shall cease to be eligible under Section 7.08
and shall fail to resign after written request therefor by the
Company or by any such Certificateholder; or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation;
then, in any case, (i) the Company may remove the Trustee or (ii) any
Certificateholder of the related series who has been a bona fide
Certificateholder for at least six months may, on behalf of itself and all
others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee of
such Trust.
(e) If a Responsible Officer of the Trustee shall obtain actual
knowledge of an Avoidable Tax (as defined below) in respect of any Trust
which has been or is likely to be asserted, the Trustee shall promptly
notify the Company and shall, within 30 days of such notification, resign
as Trustee of such Trust hereunder unless within such 30-day period the
Trustee shall have received notice that the Company has agreed to pay such
tax. The Company shall promptly appoint a successor Trustee of such Trust
in a jurisdiction where there are no Avoidable Taxes. As used herein, an
"Avoidable Tax" in respect of such Trust means a state or local tax: (i)
upon (w) such Trust, (x) such Trust Property, (y) Certificateholders of
such Trust or (z) the Trustee for which the Trustee is entitled to seek
reimbursement from the Trust Property of such Trust, and (ii) which would
be avoided if the Trustee were located in another state, or jurisdiction
within a state, within the United States of America. A tax shall not be an
Avoidable Tax in respect of any Trust if the Company or any Owner Trustee
shall agree to pay, and shall pay, such tax.
(f) If the Trustee shall resign, be removed or become incapable
of acting as Trustee of any Trust or if a vacancy shall occur in the office
of the Trustee of any Trust for any cause, the Company shall promptly
appoint a successor Trustee of such Trust. If, within one year after such
resignation, removal or incapability, or other occurrence of such vacancy,
a successor Trustee of such Trust shall be appointed by Direction of the
Certificateholders of the related series holding Certificates of such
series evidencing Fractional Undivided Interests aggregating not less than
a majority in interest in such Trust delivered to the Company, the related
Owner Trustees, the related Loan Trustee and the retiring Trustee, then the
successor Trustee of such Trust so appointed shall, with the approval of
the Company of such appointment, which approval shall not be unreasonably
withheld, forthwith upon its acceptance of such appointment, become the
successor Trustee of such Trust and supersede the successor Trustee of such
Trust appointed as provided above. If no successor Trustee shall have been
so appointed as provided above and accepted appointment in the manner
hereinafter provided, the resigning Trustee or any Certificateholder who
has been a bona fide Certificateholder of the related series for at least
six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a
successor Trustee of such Trust.
(g) The successor Trustee of a Trust shall give notice of the
resignation and removal of the Trustee and appointment of the successor
Trustee by mailing written notice of such event by first-class mail,
postage prepaid, to the Certificateholders of the related series as their
names and addresses appear in the Register. Each notice shall include the
name of such successor Trustee and the address of its Corporate Trust
Office.
Section 7.10. Acceptance of Appointment by Successor. Every successor
Trustee appointed hereunder shall execute and deliver to the Company and to
the retiring Trustee with respect to any or all Trusts an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee with respect to such Trusts shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the
retiring Trustee; but, on request of the Company or the successor Trustee,
such retiring Trustee shall execute and deliver an instrument transferring
to such successor Trustee all such rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such
successor Trustee all Trust Property held by such retiring Trustee in
respect of such Trusts hereunder, subject nevertheless to its lien, if any,
provided for in Section 7.07. Upon request of any such successor Trustee,
the Company, the retiring Trustee and such successor Trustee shall execute
and deliver any and all instruments containing such provisions as shall be
necessary or desirable to transfer and confirm to, and for more fully and
certainly vesting in, such successor Trustee all such rights, powers and
trusts.
If a successor Trustee is appointed with respect to one or more (but
not all) Trusts, the Company, the predecessor Trustee and each successor
Trustee with respect to any Trust shall execute and deliver a supplemental
agreement hereto which shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and
duties of the predecessor Trustee with respect to the Trusts as to which
the predecessor Trustee is not retiring shall continue to be vested in the
predecessor Trustee, and shall add to or change any of the provisions of
this Basic Agreement and the applicable Trust Supplements as shall be
necessary to provide for or facilitate the administration of the Trusts
under this Agreement by more than one Trustee, it being understood that
nothing herein or in such supplemental agreement shall constitute such
Trustees as co-Trustees of the same Trust and that each such Trustee shall
be Trustee of separate Trusts.
No institution shall accept its appointment as a Trustee hereunder
unless at the time of such acceptance such institution shall be qualified
and eligible under this Article VII.
Section 7.11. Merger, Conversion, Consolidation or Succession to
Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party,
or any corporation succeeding to all or substantially all of the corporate
trust business of the Trustee, shall be the successor of the Trustee
hereunder; provided, however, that such corporation shall be otherwise
qualified and eligible under this Article VII, without the execution or
filing of any paper or any further act on the part of any of the parties
hereto. In case any Certificates shall have been executed or authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
execution or authentication and deliver the Certificates so executed or
authenticated with the same effect as if such successor Trustee had itself
executed or authenticated such Certificates.
Section 7.12. Maintenance of Agencies. (a) With respect to each
series of Certificates, there shall at all times be maintained an office or
agency in the location set forth in Section 12.04 where Certificates of
such series may be presented or surrendered for registration of transfer or
for exchange, and for payment thereof, and where notices and demands, to or
upon the Trustee in respect of such Certificates or this Agreement may be
served; provided, however, that, if it shall be necessary that the Trustee
maintain an office or agency in another location with respect to the
Certificates of any series (e.g., the Certificates of such series shall be
represented by Definitive Certificates and shall be listed on a national
securities exchange), the Trustee will make all reasonable efforts to
establish such an office or agency. Written notice of the location of each
such other office or agency and of any change of location thereof shall be
given by the Trustee to the Company, the Parent, any Owner Trustees, the
Loan Trustees (in the case of any Owner Trustee or Loan Trustee, at its
address specified in the Note Documents or such other address as may be
notified to the Trustee) and the Certificateholders of such series. In the
event that no such office or agency shall be maintained or no such notice
of location or of change of location shall be given, presentations and
demands may be made and notices may be served at the Corporate Trust Office
of the Trustee.
(b) There shall at all times be a Registrar and a Paying Agent
hereunder with respect to the Certificates of each series. Each such
Authorized Agent shall be a bank or trust company, shall be a corporation
organized and doing business under the laws of the United States or any
state, with a combined capital and surplus of at least $75,000,000, or a
corporation having a combined capital and surplus in excess of $5,000,000,
the obligations of which are guaranteed by a corporation organized and
doing business under the laws of the United States or any state, with a
combined capital and surplus of at least $75,000,000, and shall be
authorized under such laws to exercise corporate trust powers, subject to
supervision by federal or state authorities. The Trustee shall initially be
the Paying Agent and, as provided in Section 3.04, Registrar hereunder with
respect to the Certificates of each series. Each Registrar shall furnish to
the Trustee, at stated intervals of not more than six months, and at such
other times as the Trustee may request in writing, a copy of the Register
maintained by such Registrar.
(c) Any corporation into which any Authorized Agent may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, consolidation or conversion to which any
Authorized Agent shall be a party, or any corporation succeeding to the
corporate trust business of any Authorized Agent, shall be the successor of
such Authorized Agent, if such successor corporation is otherwise eligible
under this Section 7.12, without the execution or filing of any paper or
any further act on the part of the parties hereto or such Authorized Agent
or such successor corporation.
(d) Any Authorized Agent may at any time resign by giving
written notice of resignation to the Trustee, the Company, any related
Owner Trustees and the related Loan Trustees. The Company may, and at the
request of the Trustee shall, at any time terminate the agency of any
Authorized Agent by giving written notice of termination to such Authorized
Agent and to the Trustee. Upon the resignation or termination of an
Authorized Agent or in case at any time any such Authorized Agent shall
cease to be eligible under this Section 7.12 (when, in either case, no
other Authorized Agent performing the functions of such Authorized Agent
shall have been appointed), the Company shall promptly appoint one or more
qualified successor Authorized Agents, reasonably satisfactory to the
Trustee, to perform the functions of the Authorized Agent which has
resigned or whose agency has been terminated or who shall have ceased to be
eligible under this Section 7.12. The Company shall give written notice of
any such appointment made by it to the Trustee, any related Owner Trustees
and the related Loan Trustees; and in each case the Trustee shall mail
notice of such appointment to all Certificateholders of the related series
as their names and addresses appear on the Register for such series.
(e) The Company agrees to pay, or cause to be paid, from time
to time to each Authorized Agent reasonable compensation for its services
and to reimburse it for its reasonable expenses.
Section 7.13. Money for Certificate Payments to Be Held in Trust. All
moneys deposited with any Paying Agent for the purpose of any payment on
Certificates shall be deposited and held in trust for the benefit of the
Certificateholders entitled to such payment, subject to the provisions of
this Section 7.13. Moneys so deposited and held in trust shall constitute a
separate trust fund for the benefit of the Certificateholders with respect
to which such money was deposited.
The Trustee may at any time, for the purpose of obtaining the
satisfaction and discharge of this Agreement or for any other purpose,
direct any Paying Agent to pay to the Trustee all sums held in trust by
such Paying Agent, such sums to be held by the Trustee upon the same trusts
as those upon which such sums were held by such Paying Agent; and, upon
such payment by any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Section 7.14. Registration of Equipment Notes in Trustee's Name.
Subject to the provisions of any Intercreditor Agreement, the Trustee
agrees that all Equipment Notes to be purchased by any Trust and Permitted
Investments, if any, shall be issued in the name of the Trustee as trustee
for the applicable Trust or its nominee and held by the Trustee in trust
for the benefit of the Certificateholders of such series, or, if not so
held, the Trustee or its nominee shall be reflected as the owner of such
Equipment Notes or Permitted Investments, as the case may be, in the
register of the issuer of such Equipment Notes or Permitted Investments, as
the case may be.
Section 7.15. Representations and Warranties of Trustee. The
Trustee hereby represents and warrants that:
(a) the Trustee is a national banking association
organized and validly existing in good standing under the laws of the
State of Connecticut.
(b) the Trustee has full power, authority and legal right
to execute, deliver and perform this Agreement, any Intercreditor
Agreement and the Note Purchase Agreements and has taken all
necessary action to authorize the execution, delivery and performance
by it of this Agreement, any Intercreditor Agreement and the Note
Purchase Agreements;
(c) the execution, delivery and performance by the
Trustee of this Agreement, any Intercreditor Agreement and the Note
Purchase Agreements (i) will not violate any provision of any United
States federal law or the law of the state of the United States where
it is located governing the banking and trust powers of the Trustee
or any order, writ, judgment, or decree of any court, arbitrator or
governmental authority applicable to the Trustee or any of its
assets, (ii) will not violate any provision of the charter documents
or by-laws of the Trustee, and (iii) will not violate any provision
of, or constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of any lien on any
properties included in the Trust Property pursuant to the provisions
of any mortgage, indenture, contract, agreement or other undertaking
to which it is a party, which violation, default or lien could
reasonably be expected to have an adverse effect on the Trustee's
performance or ability to perform its duties hereunder or thereunder
or on the transactions contemplated herein or therein;
(d) the execution, delivery and performance by the
Trustee of this Agreement, any Intercreditor Agreement and the Note
Purchase Agreements will not require the authorization, consent, or
approval of, the giving of notice to, the filing or registration
with, or the taking of any other action in respect of, any
governmental authority or agency of the United States or the state of
the United States where it is located regulating the banking and
corporate trust activities of the Trustee; and
(e) this Agreement, any Intercreditor Agreement and the
Note Purchase Agreements have been or will be duly executed and
delivered by the Trustee and upon such execution and delivery will
constitute the legal, valid and binding agreements of the Trustee,
enforceable against it in accordance with their respective terms;
provided, however, that enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and (ii)
general principles of equity.
Section 7.16. Withholding Taxes; Information Reporting. As to the
Certificates of any series, the Trustee, as trustee of the related grantor
trust created by this Agreement, shall exclude and withhold from each
distribution of principal, premium, if any, and interest and other amounts
due under this Agreement or under the Certificates of such series any and
all withholding taxes applicable thereto as required by law. The Trustee
agrees to act as such withholding agent and, in connection therewith,
whenever any present or future taxes or similar charges are required to be
withheld with respect to any amounts payable in respect of the Certificates
of such series, to withhold such amounts and timely pay the same to the
appropriate authority in the name of and on behalf of the
Certificateholders of such series, that it will file any necessary
withholding tax returns or statements when due, and that, as promptly as
possible after the payment thereof, it will deliver to each such
Certificateholder of such series appropriate documentation showing the
payment thereof, together with such additional documentary evidence as such
Certificateholders may reasonably request from time to time. The Trustee
agrees to file any other information reports as it may be required to file
under United States law.
Section 7.17. Trustee's Liens. The Trustee in its individual capacity
agrees that it will, in respect of each Trust created by this Agreement, at
its own cost and expense promptly take any action as may be necessary to
duly discharge and satisfy in full any mortgage, pledge, lien, charge,
encumbrance, security interest or claim ("Trustee's Liens") on or with
respect to the Trust Property of such Trust which is attributable to the
Trustee either (i) in its individual capacity and which is unrelated to the
transactions contemplated by this Agreement or the related Note Documents
or (ii) as Trustee under this Agreement or in its individual capacity and
which arises out of acts or omissions which are not contemplated by this
Agreement.
Section 7.18. Preferential Collection of Claims. The Trustee shall
comply with Section 311(a) of the Trust Indenture Act, excluding any
creditor relationship listed in Section 311(b) of the Trust Indenture Act.
If the Trustee shall resign or be removed as Trustee, it shall be subject
to Section 311(a) of the Trust Indenture Act to the extent provided
therein.
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE
Section 8.01. The Company to Furnish Trustee with Names and Addresses
of Certificateholders. The Company will furnish to the Trustee within 15
days after each Record Date with respect to a Scheduled Payment, and at
such other times as the Trustee may request in writing within 30 days after
receipt by the Company of any such request, a list, in such form as the
Trustee may reasonably require, of all information in the possession or
control of the Company as to the names and addresses of the
Certificateholders of each series, in each case as of a date not more than
15 days prior to the time such list is furnished; provided, however, that
so long as the Trustee is the sole Registrar for such series, no such list
need be furnished; and provided further, however, that no such list need be
furnished for so long as a copy of the Register is being furnished to the
Trustee pursuant to Section 7.12.
Section 8.02. Preservation of Information, Communications to
Certificateholders. The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Certificateholders of
each series contained in the most recent list furnished to the Trustee as
provided in Section 7.12 or Section 8.01, as the case may be, and the names
and addresses of Certificateholders of each series received by the Trustee
in its capacity as Registrar, if so acting. The Trustee may destroy any
list furnished to it as provided in Section 7.12 or Section 8.01, as the
case may be, upon receipt of a new list so furnished.
Section 8.03. Reports by Trustee. Within 60 days after May 15 of each
year commencing with the first full year following the issuance of any
series of Certificates, the Trustee shall transmit to the
Certificateholders of such series, as provided in Section 313(c) of the
Trust Indenture Act, a brief report dated as of May 15, if required by
Section 313(a) of the Trust Indenture Act.
Section 8.04. Reports by the Company. The Company shall:
(a) file with the Trustee, within 30 days after the
Company is required to file the same with the SEC, copies of the
annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the SEC may
from time to time by rules and regulations prescribe) which the
Company is required to file with the SEC pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934, as amended; or,
if the Company is not required to file information, documents or
reports pursuant to either of such sections, then to file with the
Trustee and the SEC, in accordance with rules and regulations
prescribed by the SEC, such of the supplementary and periodic
information, documents and reports which may be required pursuant to
section 13 of the Securities Exchange Act of 1934, as amended, in
respect of a security listed and registered on a national securities
exchange as may be prescribed in such rules and regulations;
(b) file with the Trustee and the SEC, in accordance with
the rules and regulations prescribed by the SEC, such additional
information, documents and reports with respect to compliance by the
Company with the conditions and covenants of the Company provided for
in this Agreement, as may be required by such rules and regulations,
including, in the case of annual reports, if required by such rules
and regulations, certificates or opinions of independent public
accountants, conforming to the requirements of Section 1.02;
(c) transmit to all Certificateholders, in the manner and
to the extent provided in Section 313(c) of the Trust Indenture Act
such summaries of any information, documents and reports required to
be filed by the Company pursuant to subsections (a) and (b) of this
Section 8.04 as may be required by rules and regulations prescribed
by the SEC; and
(d) furnish to the Trustee, not less often than annually,
a brief certificate from the principal executive officer, principal
financial officer or principal accounting officer as to his knowledge
of the Company's compliance with all conditions and covenants under
this Agreement (it being understood that for purposes of this
paragraph (d), such compliance shall be determined without regard to
any period of grace or requirement of notice provided under this
Agreement).
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
Section 9.01. Supplemental Agreements Without Consent of
Certificateholders. Without the consent of the Certificateholders, the
Company and the Parent may (but will not be required to), and the Trustee
(subject to Section 9.03) shall, at the Company's request, at any time and
from time to time, enter into one or more agreements supplemental hereto
or, if applicable, to an Intercreditor Agreement, a Note Purchase Agreement
or a Liquidity Facility, in form satisfactory to the Trustee, for any of
the following purposes:
(1) to provide for the formation of a Trust, the issuance of a
series of Certificates and other matters contemplated by Section
2.01(b); or
(2) to evidence the succession of another corporation to the
Company or the Parent, if the Parent is a party to such Trust
Supplement, and the assumption by any such successor of the covenants
of the Company or the Parent, herein contained or of the Company's or
the Parent's obligations, if any, under any Intercreditor Agreement,
any Note Purchase Agreement or any Liquidity Facility; or
(3) to add to the covenants of the Company or the Parent, if
the Parent is a party to such Trust Supplement, for the benefit of
the Certificateholders of any series, or to surrender any right or
power conferred upon the Company or the Parent in this Agreement, any
Intercreditor Agreement or any Liquidity Facility; or
(4) to correct or supplement any provision in this Agreement,
any Intercreditor Agreement, any Note Purchase Agreement or any
Liquidity Facility which may be defective or inconsistent with any
other provision herein or therein or to cure any ambiguity or to
modify any other provision with respect to matters or questions
arising under this Agreement, any Intercreditor Agreement, any Note
Purchase Agreement or any Liquidity Facility, provided, however, that
any such action shall not materially adversely affect the interests
of the Certificateholders of any series; to correct any mistake in
this Agreement, any Intercreditor Agreement, any Note Purchase
Agreement or any Liquidity Facility; or, as provided in any
Intercreditor Agreement, to give effect to or provide for a
Replacement Liquidity Facility (as defined in such Intercreditor
Agreement); or
(5) to comply with any requirement of the SEC, any applicable
law, rules or regulations of any exchange or quotation system on
which the Certificates of any series are listed or of any regulatory
body; or
(6) to modify, eliminate or add to the provisions of this
Agreement, any Intercreditor Agreement, any Note Purchase Agreement
or any Liquidity Facility to such extent as shall be necessary to
continue the qualification of this Agreement, any Intercreditor
Agreement, any Note Purchase Agreement or any Liquidity Facility
(including any supplemental agreement) under the Trust Indenture Act
or under any similar Federal statute hereafter enacted, and to add to
this Agreement, any Intercreditor Agreement, any Note Purchase
Agreement or any Liquidity Facility such other provisions as may be
expressly permitted by the Trust Indenture Act, excluding, however,
the provisions referred to in Section 316(a)(2) of the Trust
Indenture Act as in effect at the date as of which this Basic
Agreement was executed or any corresponding provision in any similar
Federal statute hereafter enacted; or
(7) to evidence and provide for the acceptance of appointment
under this Agreement, any Intercreditor Agreement, any Note Purchase
Agreement or any Liquidity Facility by a successor Trustee with
respect to one or more Trusts and to add to or change any of the
provisions of this Agreement, any Intercreditor Agreement or any
Liquidity Facility as shall be necessary to provide for or facilitate
the administration of the Trust, pursuant to the requirements of
Section 7.10; or
(8) to provide the information required under Section 7.12 and
Section 12.04 as to the Trustee; or
(9) to make any other amendments or modifications hereto,
provided, however, that such amendments or modifications shall apply
to Certificates of any series to be thereafter issued;
provided, however, that no such supplemental agreement shall adversely
affect the status of any Trust as a grantor trust under Subpart E, Part I
of Subchapter J of Chapter 1 of Subtitle A of the Internal Revenue Code of
1986, as amended, for U.S. federal income tax purposes.
Section 9.02. Supplemental Agreements With Consent of
Certificateholders. With respect to each separate Trust and the series of
Certificates relating thereto, with the consent of the Certificateholders
holding Certificates of such series (including consents obtained in
connection with a tender offer or exchange offer for the Certificates)
evidencing Fractional Undivided Interests aggregating not less than a
majority in interest in such Trust, by Direction of said Certificateholders
delivered to the Company, the Parent and the Trustee, the Company and the
Parent may (with the consent of the Owner Trustees, if any, relating to
such Certificates, which consent shall not be unreasonably withheld), but
shall not be obligated to, and the Trustee (subject to Section 9.03) shall,
enter into an agreement or agreements supplemental hereto for the purpose
of adding any provisions to or changing in any manner or eliminating any of
the provisions of this Agreement, any Intercreditor Agreement or any
Liquidity Facility to the extent applicable to such Certificateholders or
of modifying in any manner the rights and obligations of such
Certificateholders under this Agreement, any Intercreditor Agreement or any
Liquidity Facility; provided, however, that no such agreement shall,
without the consent of the Certificateholder of each Outstanding
Certificate affected thereby:
(1) reduce in any manner the amount of, or delay the timing of,
any receipt by the Trustee of payments on the Equipment Notes held in
such Trust or distributions that are required to be made herein on
any Certificate of such series, or change any date of payment on any
Certificate of such series, or change the place of payment where, or
the coin or currency in which, any Certificate of such series is
payable, or impair the right to institute suit for the enforcement of
any such payment or distribution on or after the Regular Distribution
Date or Special Distribution Date applicable thereto; or
(2) permit the disposition of any Equipment Note included in
the Trust Property of such Trust except as permitted by this
Agreement, or otherwise deprive such Certificateholder of the benefit
of the ownership of the Equipment Notes in such Trust; or
(3) alter the priority of distributions specified in the
Intercreditor Agreement in a manner materially adverse to the
interests of the Certificateholders of any series; or
(4) reduce the specified percentage of the aggregate Fractional
Undivided Interests of such Trust that is required for any such
supplemental agreement, or reduce such specified percentage required
for any waiver (of compliance with certain provisions of this
Agreement or certain defaults hereunder and their consequences)
provided for in this Agreement; or
(5) modify any of the provisions of this Section 9.02 or
Section 6.05, except to increase any such percentage or to provide
that certain other provisions of this Agreement cannot be modified or
waived without the consent of the Certificateholder of each
Certificate of such series affected thereby; or
(6) adversely affect the status of any Trust as a grantor trust
under Subpart E, Part I of Subchapter J of Chapter 1 of Subtitle A of
the Internal Revenue Code of 1986, as amended, for U.S. federal
income tax purposes.
It shall not be necessary for any Direction of such
Certificateholders under this Section 9.02 to approve the particular form
of any proposed supplemental agreement, but it shall be sufficient if such
Direction shall approve the substance thereof.
Section 9.03. Documents Affecting Immunity or Indemnity. If in the
opinion of the Trustee any document required to be executed by it pursuant
to the terms of Section 9.01 or 9.02 affects any interest, right, duty,
immunity or indemnity in favor of the Trustee under this Basic Agreement or
any Trust Supplement, the Trustee may in its discretion decline to execute
such document.
Section 9.04. Execution of Supplemental Agreements. In executing, or
accepting the additional trusts created by, any supplemental agreement
permitted by this Article or the modifications thereby of the trusts
created by this Agreement, the Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Opinion of Counsel stating
that the execution of such supplemental agreement is authorized or
permitted by this Agreement.
Section 9.05. Effect of Supplemental Agreements. Upon the execution
of any agreement supplemental to this Agreement under this Article, this
Basic Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Basic Agreement for all
purposes; and every Certificateholder of each series theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby to
the extent applicable to such series.
Section 9.06. Conformity With Trust Indenture Act. Every supplemental
agreement executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.
Section 9.07. Reference in Certificates to Supplemental Agreements.
Certificates of each series authenticated and delivered after the execution
of any supplemental agreement applicable to such series pursuant to this
Article may bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental agreement; and, in such case,
suitable notation may be made upon Outstanding Certificates of such series
after proper presentation and demand.
Section 9.08. Release of Parent. Upon the request of the Parent, and
so long as the Parent has not executed a guaranty in respect of any Lease
or Equipment Note, the Trustee shall execute an agreement supplemental
hereto for the purpose of releasing the Parent from any and all of its
obligations and liabilities under this Agreement and upon the execution of
such supplemental agreement, the Parent shall cease to be a party to this
Agreement.
ARTICLE X
AMENDMENTS TO INDENTURE AND NOTE DOCUMENTS
Section 10.01. Amendments and Supplements to Indenture and Other Note
Documents. In the event that the Trustee, as holder (or beneficial owner
through the Subordination Agent) of any Equipment Notes (or as a
prospective purchaser of any Postponed Notes) in trust for the benefit of
the Certificateholders of any series or as Controlling Party under an
Intercreditor Agreement, receives (directly or indirectly through the
Subordination Agent) a request for a consent to any amendment,
modification, waiver or supplement under any Indenture, other Note Document
or any other related document, the Trustee shall forthwith send a notice of
such proposed amendment, modification, waiver or supplement to each
Certificateholder of such series registered on the Register as of the date
of such notice. The Trustee shall request from the Certificateholders of
such series a Direction as to (a) whether or not to take or refrain from
taking (or direct the Subordination Agent to take or refrain from taking)
any action which a holder of (or, with respect to Postponed Notes, a
prospective purchaser of) such Equipment Note has the option to direct, (b)
whether or not to give or execute (or direct the Subordination Agent to
give or execute) any waivers, consents, amendments, modifications or
supplements as a holder of (or, with respect to Postponed Notes, a
prospective purchaser of) such Equipment Note or a Controlling Party and
(c) how to vote (or direct the Subordination Agent to vote) any Equipment
Note (or, with respect to a Postponed Note, its commitment to acquire such
Postponed Note) if a vote has been called for with respect thereto.
Provided such a request for Certificateholder Direction shall have been
made, in directing any action or casting any vote or giving any consent as
the holder of any Equipment Note (or in directing the Subordination Agent
in any of the foregoing), (i) other than as Controlling Party, the Trustee
shall vote for or give consent to any such action with respect to such
Equipment Note (or Postponed Note) in the same proportion as that of (A)
the aggregate face amounts of all Certificates actually voted in favor of
or for giving consent to such action by such Direction of
Certificateholders to (B) the aggregate face amount of all Outstanding
Certificates and (ii) as Controlling Party, the Trustee shall vote as
directed in such Certificateholder Direction by the Certificateholders of
such series evidencing a Fractional Undivided Interest aggregating not less
than a majority in interest in the Trust. For purposes of the immediately
preceding sentence, a Certificate shall have been "actually voted" if the
Holder of such Certificate has delivered to the Trustee an instrument
evidencing such Holder's consent to such Direction prior to one Business
Day before the Trustee directs such action or casts such vote or gives such
consent. Notwithstanding the foregoing, but subject to Section 6.04 and any
Intercreditor Agreement, the Trustee may, with respect to the Certificates
of any series, in its own discretion and at its own direction, consent and
notify the relevant Loan Trustee of such consent (or direct the
Subordination Agent to consent and notify the Loan Trustee of such consent)
to any amendment, modification, waiver or supplement under any related
Indenture or any other related Note Document if an Event of Default
hereunder shall have occurred and be continuing or if such amendment,
modification, waiver or supplement will not materially adversely affect the
interests of the Certificateholders of such series.
ARTICLE XI
TERMINATION OF TRUSTS
Section 11.01. Termination of the Trusts. In respect of each Trust
created by the Basic Agreement as supplemented by a related Trust
Supplement, the respective obligations and responsibilities of the Company,
the Parent, if any, and the Trustee with respect to such Trust shall
terminate upon the distribution to all Holders of Certificates of the
series of such Trust and the Trustee of all amounts required to be
distributed to them pursuant to this Agreement and the disposition of all
property held as part of the Trust Property of such Trust; provided,
however, that in no event shall such Trust continue beyond 21 years less
one day following the death of the last survivor of all descendants living
on the date hereof of Joseph P. Kennedy, Sr., unless applicable law shall
permit a longer term, in which case such longer term shall apply.
Notice of any termination of a Trust, specifying the applicable
Regular Distribution Date (or applicable Special Distribution Date, as the
case may be) upon which the Certificateholders of any series may surrender
their Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Certificateholders
of such series not earlier than the minimum number of days and not later
than the maximum number of days specified therefor in the related Trust
Supplement preceding such final distribution specifying (A) the Regular
Distribution Date (or Special Distribution Date, as the case may be) upon
which the proposed final payment of the Certificates of such series will be
made upon presentation and surrender of Certificates of such series at the
office or agency of the Trustee therein specified, (B) the amount of any
such proposed final payment, and (C) that the Record Date otherwise
applicable to such Regular Distribution Date (or Special Distribution Date,
as the case may be) is not applicable, payments being made only upon
presentation and surrender of the Certificates of such series at the office
or agency of the Trustee therein specified. The Trustee shall give such
notice to the Registrar at the time such notice is given to
Certificateholders of such series. Upon presentation and surrender of the
Certificates of such series in accordance with such notice, the Trustee
shall cause to be distributed to Certificateholders of such series amounts
distributable on such Regular Distribution Date (or Special Distribution
Date, as the case may be) pursuant to Section 4.02.
In the event that all of the Certificateholders of such series shall
not surrender their Certificates for cancellation within six months after
the date specified in the above-mentioned written notice, the Trustee shall
give a second written notice to the remaining Certificateholders of such
series to surrender their Certificates for cancellation and receive the
final distribution with respect thereto. No additional interest shall
accrue on the Certificates of such series after any Regular Distribution
Date (or Special Distribution Date, as the case may be) of such series, as
specified in the first written notice. In the event that any money held by
the Trustee for the payment of distributions on the Certificates of such
series shall remain unclaimed for two years (or such lesser time as the
Trustee shall be satisfied, after 60 days' notice from the Company, is one
month prior to the escheat period provided under applicable law) after the
final distribution date with respect thereto, the Trustee shall pay to each
Loan Trustee the appropriate amount of money relating to such Loan Trustee
and shall give written notice thereof to the related Owner Trustees and the
Company.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder of any series shall not operate to
terminate this Agreement or the related Trust, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting
or to take any action or commence any proceeding in any court for a
partition or winding up of the Trust, nor otherwise affect the rights,
obligations, and liabilities of the parties hereto or any of them.
Section 12.02. Liabilities of Certificateholders. Neither the
existence of the Trust nor any provision in this Agreement is intended to
or shall limit the liability the Certificateholders would otherwise incur
if the Certificateholders owned Trust Property as co-owners, or incurred
any obligations of the Trust, directly rather than through the Trust.
Section 12.03. Registration of Equipment Notes in Name of
Subordination Agent. If a Trust is party to an Intercreditor Agreement, the
Trustee agrees that all Equipment Notes to be purchased by such Trust shall
be issued in the name of the Subordination Agent under such Intercreditor
Agreement or its nominee and held by such Subordination Agent in trust for
the benefit of the Certificateholders, or, if not so held, such
Subordination Agent or its nominee shall be reflected as the owner of such
Equipment Notes in the register of the issuer of such Equipment Notes.
Section 12.04. Notices. (a) Unless otherwise specifically provided
herein or in the applicable Trust Supplement with respect to any Trust, all
notices required under the terms and provisions of this Basic Agreement or
such Trust Supplement with respect to such Trust shall be in English and in
writing, and any such notice may be given by United States mail, courier
service or telecopy, and any such notice shall be effective when delivered
or received or, if mailed, three days after deposit in the United States
mail with proper postage for ordinary mail prepaid,
if to the Company or the Parent:
US Airways, Inc. (for the Company)
US Airways Group, Inc. (for the Parent)
2345 Crystal Drive
Arlington, VA 22227
Attention: Treasurer
Telephone:(703) 872-5918
Fax: (703) 872-5936
with a copy to the attention of the Buyer's Office
of the General Counsel at the same address:
Attention: Aircraft Counsel
Fax: (703) 872-5252
if to the Trustee:
State Street Bank and Trust Company of Connecticut,
National Association
225 Asylum Street
Hartford, CT 06103
Attention: Corporate/Muni Department
Facsimile: (617) 664-5151
Telephone: (617) 664-5340
(b) The Company, the Parent or the Trustee, by notice to the
other, may designate additional or different addresses for subsequent
notices or communications.
(c) Any notice or communication to Certificateholders of any
series shall be mailed by first-class mail to the addresses for
Certificateholders of such series shown on the Register kept by the
Registrar and to addresses filed with the Trustee for Certificate Owners of
such series. Failure so to mail a notice or communication or any defect in
such notice or communication shall not affect its sufficiency with respect
to other Certificateholders or Certificate Owners of such series.
(d) If a notice or communication is mailed in the manner
provided above within the time prescribed, it is conclusively presumed to
have been duly given, whether or not the addressee receives it.
(e) If the Company or the Parent mails a notice or
communication to the Certificateholders of such series, it shall mail a
copy to the Trustee and to each Paying Agent for such series at the same
time.
(f) Notwithstanding the foregoing, all communications or
notices to the Trustee shall be deemed to be given only when received by a
Responsible Officer of the Trustee.
(g) The Trustee shall promptly furnish the Company and the
Parent with a copy of any demand, notice or written communication received
by the Trustee hereunder from any Certificateholder, Owner Trustee or Loan
Trustee.
Section 12.05. Governing Law. THIS BASIC AGREEMENT, TOGETHER WITH ALL
TRUST SUPPLEMENTS AND CERTIFICATES, SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 12.06. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements,
provisions, or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in
no way affect the validity or enforceability of the other provisions of
this Agreement or the related Trust, or of the Certificates of such series
or the rights of the Certificateholders thereof.
Section 12.07. Trust Indenture Act Controls. This Agreement is
subject to the provisions of the Trust Indenture Act and shall, to the
extent applicable, be governed by such provisions. If any provision of this
Agreement limits, qualifies or conflicts with another provision which is
required to be included in this Agreement by the Trust Indenture Act, the
required provision shall control.
Section 12.08. Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience
only and shall not affect the construction hereof.
Section 12.09. Successors and Assigns. All covenants, agreements,
representations and warranties in this Agreement by the Trustee, the Parent
and the Company shall bind and, to the extent permitted hereby, shall inure
to the benefit of and be enforceable by their respective successors and
assigns, whether so expressed or not.
Section 12.10. Benefits of Agreement. Nothing in this Agreement or in
the Certificates of any series, express or implied, shall give to any
Person, other than the parties to this Agreement and their successors under
this Agreement, and the Certificateholders of each series, any benefit or
any legal or equitable right, remedy or claim under this Agreement.
Section 12.11. Legal Holidays. In any case where any Regular
Distribution Date or Special Distribution Date relating to any Certificate
of any series shall not be a Business Day with respect to such series, then
(notwithstanding any other provision of this Agreement) payment need not be
made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on such Regular Distribution Date or
Special Distribution Date, and no interest shall accrue during the
intervening period.
Section 12.12. Counterparts. For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.
Section 12.13. Communication by Certificateholders With Other
Certificateholders. Certificateholders of any series may communicate with
other Certificateholders of such series with respect to their rights under
this Basic Agreement, the related Trust Supplement or the Certificates of
such series pursuant to Section 312(b) of the Trust Indenture Act. The
Company, the Parent, the Trustee and any and all other persons benefitted
by this Agreement shall have the protection afforded by Section 312(c) of
the Trust Indenture Act.
Section 12.14. Intention of Parties. The parties to this Agreement
intend that each Trust be classified for U.S. federal income tax purposes
as a grantor trust under Subpart E, Part I of Subchapter J of the Internal
Revenue Code of 1986, as amended, and not as a trust or association taxable
as a corporation or as a partnership. The powers granted and obligations
undertaken pursuant to this Agreement shall be so construed so as to
further such intent.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of the
day and year first written above.
US AIRWAYS GROUP, INC.
By: /s/ Jeffery A. McDougle
___________________________
Name: Jeffery A. McDougle
Title: Vice President and
Treasurer
US AIRWAYS, INC.
By: /s/ Jeffery A. McDougle
__________________________
Name: Jeffery A. McDougle
Title:Vice President and
Treasurer
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee
By: /s/ Julie A. Balerna
__________________________
Name: Julie A. Balerna
Title:Assistant Vice President
EXHIBIT A
FORM OF CERTIFICATE*
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.**
US AIRWAYS ____________ PASS THROUGH TRUST
* To be used in connection with Certificates offered pursuant to a
Trust Supple ment to which US Airways Group, Inc. is not a party.
**
This legend to appear on Book-Entry Certificates to be deposited with
The Depository Trust Company.
Pass Through Certificate, Series __________
Final Regular Distribution Date: _____, ____
evidencing a fractional undivided interest in a trust,
the property of which includes certain equipment notes
each secured by Aircraft owned by or leased to US
Airways, Inc.
Certificate
No.______ $__________ Fractional Undivided Interest representing
._____% of the Trust per $1,000 face amount
THIS CERTIFIES THAT __________________, for value received, is the
registered owner of a $___________ (________ dollars) Fractional Undivided
Interest in the US Airways Pass Through Trust, Series [___] (the "Trust")
created by State Street Bank and Trust Company of Connecticut, National
Association, as trustee (the "Trustee"), pursuant to a Pass Through Trust
Agreement dated as of [ ], 1999 (the "Trustee"), pursuant to a Pass Through
Trust Agreement dated as of [ ], 1999 (the "Basic Agreement"), between the
Trustee, US Airways, Inc., a corporation incorporated under Delaware law
(the "Company") and US Airways Group, Inc., a corporation incorporated
under Delaware law (the "Parent"), as supplemented by Trust Supplement No.
_______ thereto dated __________, ____, between the Trustee and the
Company, (collectively, the "Agreement"), a summary of certain of the
pertinent provisions of which is set forth below. To the extent not
otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Agreement. This Certificate is one of the
duly authorized Certificates designated as "___% US Airways Pass Through
Certificate, Series ____" (herein called the "Certificates"). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement. By virtue of its acceptance hereof, the
Certificateholder of this Certificate assents to and agrees to be bound by
the provisions of the Agreement and any related Intercreditor Agreement.
The property of the Trust includes certain Equipment Notes and all rights
of the Trust to receive any payments under any Intercreditor Agreement or
Liquidity Facility (the "Trust Property"). Each issue of the Equipment
Notes is or will be secured by, among other things, a security interest in
aircraft leased to or owned by the Company.
The Certificates represent fractional undivided interests in the
Trust and the Trust Property, and have no rights, benefits or interest in
respect of any other separate trust established pursuant to the terms of
the Basic Agreement for any other series of certificates issued pursuant
thereto.
Subject to and in accordance with the terms of the Agreement and any
related Intercreditor Agreement, from funds then available to the Trustee,
there will be distributed on each __________ and ___________ (a "Regular
Distribution Date"), commencing on _________, ____, to the Person in whose
name this Certificate is registered at the close of business on the 15th
day preceding the Regular Distribution Date, an amount in respect of the
Scheduled Payments on the Equipment Notes due on such Regular Distribution
Date, the receipt of which has been confirmed by the Trustee, equal to the
product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Scheduled Payments.
Subject to and in accordance with the terms of the Agreement and any
related Intercreditor Agreement, in the event that Special Payments on the
Equipment Notes are received by the Trustee, from funds then available to
the Trustee, there shall be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Special Payments so
received. If a Regular Distribution Date or Special Distribution Date is
not a Business Day, distribution shall be made on the immediately following
Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the Trustee by
check mailed to the Person entitled thereto, without the presentation or
surrender of this Certificate or the making of any notation hereon. Except
as otherwise provided in the Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after notice mailed by
the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency of the Trustee
specified in such notice.
The Certificates do not represent a direct obligation of, or an
obligation guaranteed by, or an interest in, the Company or the Trustee or
any affiliate thereof. The Certificates are limited in right of payment,
all as more specifically set forth on the face hereof and in the Agreement.
All payments or distributions made to Certificateholders under the
Agreement shall be made only from the Trust Property and only to the extent
that the Trustee shall have sufficient income or proceeds from the Trust
Property to make such payments in accordance with the terms of the
Agreement. Each Certificateholder of this Certificate, by its acceptance
hereof, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement
for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by
any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Agreement at any
time by the Company and the Trustee with the consent of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust.
Any such consent by the Certificateholder of this Certificate shall be
conclusive and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without
the consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain limitations set
forth, the transfer of this Certificate is registrable in the Register upon
surrender of this Certificate for registration of transfer at the offices
or agencies maintained by the Trustee in its capacity as Registrar, or by
any successor Registrar duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the
Registrar, duly executed by the Certificateholder hereof or such
Certificateholder's attorney duly authorized in writing, and thereupon one
or more new Certificates of authorized denominations evidencing the same
aggregate Fractional Undivided Interest in the Trust will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in minimum denominations of $1,000 Fractional Undivided Interest
and integral multiples thereof except that one Certificate may be issued in
a different denomination. As provided in the Agreement and subject to
certain limitations therein set forth, the Certificates are exchangeable
for new Certificates of authorized denominations evidencing the same
aggregate Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee shall require payment of a sum sufficient to
cover any tax or governmental charge payable in connection therewith.
The Trustee, the Registrar, and any agent of the Trustee or the
Registrar may treat the person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Trustee, the
Registrar, nor any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the Agreement and the
Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them
pursuant to the Agreement and the disposition of all property held as part
of the Trust Property.
THIS CERTIFICATE AND THE AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES AND CERTIFICATEHOLDERS HEREUNDER AND THEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to
any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
US AIRWAYS PASS THROUGH TRUST By:
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Dated:_____________________
[FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Certificates
referred to in the
within-mentioned Agreement.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee
By:___________________________
Authorized Officer
EXHIBIT B
FORM OF GUARANTEED CERTIFICATE*
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.**
US AIRWAYS ____________ PASS THROUGH TRUST
* To be used in connection with Certificates offered pursuant to a
Trust Supple ment to which US Airways Group, Inc. is a party.
** This legend to appear on Book-Entry Certificates to be deposited with
The Depository Trust Company.
Pass Through Certificate, Series ___________
Final Regular Distribution Date: _____, ____
evidencing a fractional undivided interest in a trust,
the property of which includes certain equipment notes
each secured by Aircraft owned by or leased to US
Airways, Inc.
Certificate
No.______ $__________ Fractional Undivided Interest representing
._____% of the Trust per $1,000 face amount
THIS CERTIFIES THAT __________________, for value received, is the
registered owner of a $___________ (________ dollars) Fractional Undivided
Interest in the US Airways Pass Through Trust, Series [___] (the "Trust")
created by State Street Bank and Trust Company of Connecticut, National
Association, as trustee (the "Trustee"), pursuant to a Pass Through Trust
Agreement dated as of [ ], 1999 (the "Basic Agreement"), between the
Trustee, US Airways, Inc., a corporation incorporated under Delaware law
(the "Company") and US Airways Group, Inc., a corporation incorporated
under Delaware law (the "Parent"), as supplemented by Trust Supplement No.
_______ thereto dated __________, ____, between the Trustee, the Company,
and the Parent, (collectively, the "Agreement"), a summary of certain of
the pertinent provisions of which is set forth below. To the extent not
otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Agreement. This Certificate is one of the
duly authorized Certificates designated as "___% US Airways Pass Through
Certificate, Series ____" (herein called the "Certificates"). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement. By virtue of its acceptance hereof, the
Certificateholder of this Certificate assents to and agrees to be bound by
the provisions of the Agreement and any related Intercreditor Agreement.
The property of the Trust includes certain Equipment Notes and all rights
of the Trust to receive any payments under any Intercreditor Agreement or
Liquidity Facility (the "Trust Property"). Each issue of the Equipment
Notes is or will be secured by, among other things, a security interest in
aircraft leased to or owned by the Company.
The Certificates represent fractional undivided interests in the
Trust and the Trust Property, and have no rights, benefits or interest in
respect of any other separate trust established pursuant to the terms of
the Basic Agreement for any other series of certificates issued pursuant
thereto.
Subject to and in accordance with the terms of the Agreement and any
related Intercreditor Agreement, from funds then available to the Trustee,
there will be distributed on each __________ and ___________ (a "Regular
Distribution Date"), commencing on _________, ____, to the Person in whose
name this Certificate is registered at the close of business on the 15th
day preceding the Regular Distribution Date, an amount in respect of the
Scheduled Payments on the Equipment Notes due on such Regular Distribution
Date, the receipt of which has been confirmed by the Trustee, equal to the
product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Scheduled Payments.
Subject to and in accordance with the terms of the Agreement and any
related Intercreditor Agreement, in the event that Special Payments on the
Equipment Notes are received by the Trustee, from funds then available to
the Trustee, there shall be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Special Payments so
received. If a Regular Distribution Date or Special Distribution Date is
not a Business Day, distribution shall be made on the immediately following
Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the Trustee by
check mailed to the Person entitled thereto, without the presentation or
surrender of this Certificate or the making of any notation hereon. Except
as otherwise provided in the Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after notice mailed by
the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency of the Trustee
specified in such notice.
The Certificates do not represent a direct obligation of, or an
obligation guaranteed by, or an interest in, the Company, the Parent or the
Trustee or any affiliate thereof. The Certificates are limited in right of
payment, all as more specifically set forth on the face hereof and in the
Agreement. All payments or distributions made to Certificateholders under
the Agreement shall be made only from the Trust Property and only to the
extent that the Trustee shall have sufficient income or proceeds from the
Trust Property to make such payments in accordance with the terms of the
Agreement. Each Certificateholder of this Certificate, by its acceptance
hereof, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement
for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by
any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Certificateholders under the Agreement at any
time by the Company and the Trustee with the consent of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust.
Any such consent by the Certificateholder of this Certificate shall be
conclusive and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without
the consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain limitations set
forth, the transfer of this Certificate is registrable in the Register upon
surrender of this Certificate for registration of transfer at the offices
or agencies maintained by the Trustee in its capacity as Registrar, or by
any successor Registrar duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the
Registrar, duly executed by the Certificateholder hereof or such
Certificateholder's attorney duly authorized in writing, and thereupon one
or more new Certificates of authorized denominations evidencing the same
aggregate Fractional Undivided Interest in the Trust will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in minimum denominations of $1,000 Fractional Undivided Interest
and integral multiples thereof except that one Certificate may be issued in
a different denomination. As provided in the Agreement and subject to
certain limitations therein set forth, the Certificates are exchangeable
for new Certificates of authorized denominations evidencing the same
aggregate Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee shall require payment of a sum sufficient to
cover any tax or governmental charge payable in connection therewith.
The Trustee, the Registrar, and any agent of the Trustee or the
Registrar may treat the person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Trustee, the
Registrar, nor any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the Agreement and the
Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them
pursuant to the Agreement and the disposition of all property held as part
of the Trust Property.
THIS CERTIFICATE AND THE AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES AND CERTIFICATEHOLDERS HEREUNDER AND THEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to
any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
US AIRWAYS PASS THROUGH TRUST
By:STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee
By:______________________________
Title:___________________________
Dated:_____________________
[FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Certificates
referred to in the
within-mentioned Agreement.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee
By:______________________________
Authorized Officer
Exhibit 4(a)(ii)
TRUST SUPPLEMENT No. 1999-1A
Dated as of August 31, 1999
between
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Trustee,
and
US AIRWAYS, INC.
to
PASS THROUGH TRUST AGREEMENT
Dated as of July 30, 1999
US Airways Pass Through Trust 1999-1A
8.36% US Airways
Pass Through Certificates,
Series 1999-1A
This Trust Supplement No. 1999-1A, dated as of August 31,
1999 (herein called the "Trust Supplement"), between US Airways, Inc., a
Delaware corporation (the "Company") and State Street Bank and Trust
Company of Connecticut, National Association (the "Trustee"), to the Pass
Through Trust Agreement, dated as of July 30, 1999, between the Company, US
Airways Group, Inc., a Delaware corporation, and the Trustee (the "Basic
Agreement").
W I T N E S S E T H:
WHEREAS, the Basic Agreement, unlimited as to the aggregate
principal amount of Certificates (unless otherwise specified herein,
capitalized terms used herein without definition having the respective
meanings specified in the Basic Agreement) which may be issued thereunder,
has heretofore been executed and delivered;
WHEREAS, the Company obtained commitments from AVSA for the
delivery of 20 Aircraft;
WHEREAS, the Company intends to finance the acquisition of
each such Aircraft either (i) through separate leveraged lease
transactions, in which case the Company will lease such Aircraft
(collectively, the "Leased Aircraft") or (ii) through separate secured loan
transactions, in which case the Company will own such Aircraft
(collectively, the "Owned Aircraft");
WHEREAS, in the case of each Leased Aircraft, each Owner
Trustee, acting on behalf of the corresponding Owner Participant, will
issue pursuant to an Indenture, on a non-recourse basis, Equipment Notes in
order to finance a portion of its purchase price of such Leased Aircraft;
WHEREAS, in the case of each Owned Aircraft, the Company
will issue pursuant to an Indenture, on a recourse basis, Equipment Notes
to finance a portion of the purchase price of such Owned Aircraft;
WHEREAS, the Trustee hereby declares the creation of this US
Airways Pass Through Trust 1999-1A (the "Applicable Trust") for the benefit
of the Applicable Certificateholders, and the initial Applicable
Certificateholders as the grantors of the Applicable Trust, by their
respective acceptances of the Applicable Certificates, join in the creation
of the Applicable Trust with the Trustee;
WHEREAS, all Certificates to be issued by the Applicable
Trust will evidence fractional undivided interests in the Applicable Trust
and will convey no rights, benefits or interests in respect of any property
other than the Trust Property except for those Certificates to which an
Escrow Receipt has been affixed;
WHEREAS, the Escrow Agent, the Trustee, the Escrow Paying
Agent, and the Underwriters have contemporaneously herewith entered into an
Escrow Agreement with the Escrow Paying Agent pursuant to which the
Underwriters have delivered to the Escrow Agent the proceeds from the sale
of the Applicable Certificates and have irrevocably instructed the Escrow
Agent to withdraw and pay funds from such proceeds upon request and proper
certification by the Trustee to purchase Equipment Notes as the Aircraft
are delivered by AVSA under the Aircraft Purchase Agreement from time to
time prior to the Delivery Period Termination Date;
WHEREAS, the Escrow Agent on behalf of the Applicable
Certificateholders has contemporaneously herewith entered into a Deposit
Agreement with the Depositary under which the Deposits referred to therein
will be made and from which it will withdraw funds to allow the Trustee to
purchase Equipment Notes from time to time prior to the Delivery Period
Termination Date;
WHEREAS, pursuant to the terms and conditions of the Basic
Agreement as supplemented by this Trust Supplement (the "Agreement") and
the Note Purchase Agreement, the Trustee on behalf of the Applicable Trust,
using funds withdrawn under the Escrow Agreement, shall purchase one or
more Equipment Notes having the same interest rate as, and final maturity
date not later than the final Regular Distribution Date of, the Applicable
Certificates issued hereunder and, in each case, shall hold such Equipment
Notes in trust for the benefit of the Applicable Certificateholders;
WHEREAS, all of the conditions and requirements necessary to
make this Trust Supplement, when duly executed and delivered, a valid,
binding and legal instrument in accordance with its terms and for the
purposes herein expressed, have been done, performed and fulfilled, and the
execution and delivery of this Trust Supplement in the form and with the
terms hereof have been in all respects duly authorized; and
WHEREAS, this Trust Supplement is subject to the provisions
of the Trust Indenture Act of 1939, as amended, and shall, to the extent
applicable, be governed by such provisions;
NOW THEREFORE, in consideration of the premises herein, it
is agreed between the Company and the Trustee as follows:
ARTICLE I
THE CERTIFICATES
Section 1.01. The Certificates. There is hereby created a
series of Certificates to be issued under the Agreement to be distinguished
and known as "8.36% US Airways Pass Through Certificates, Series 1999-1A"
(hereinafter defined as the "Applicable Certificates"). Each Applicable
Certificate represents a fractional undivided interest in the Applicable
Trust created hereby. The Applicable Certificates shall be the only
instruments evidencing a fractional undivided interest in the Applicable
Trust.
The terms and conditions applicable to the Applicable
Certificates are as follows:
(a) The aggregate principal amount of the Applicable
Certificates that shall be authenticated under the Agreement
(except for Applicable Certificates authenticated and delivered
pursuant to Sections 3.03, 3.04 and 3.06 of the Basic Agreement) is
$384,884,000.
(b) The Regular Distribution Dates with respect to any
payment of Scheduled Payments means January 20 and July 20 of each
year, commencing on January 20, 2000, until payment of all of the
Scheduled Payments to be made under the Equipment Notes has been
made.
(c) The Special Distribution Dates with respect to the
Applicable Certificates means any Business Day on which a Special
Payment is to be distributed pursuant to the Agreement.
(d) At the Escrow Agent's request under the Escrow
Agreement, the Trustee shall affix the corresponding Escrow Receipt
to each Applicable Certificate. In any event, any transfer or
exchange of any Applicable Certificate shall also effect a transfer
or exchange of the related Escrow Receipt. Prior to the Final
Withdrawal Date, no transfer or exchange of any Applicable
Certificate shall be permitted unless the corresponding Escrow
Receipt is attached thereto and also is so transferred or
exchanged. By acceptance of any Applicable Certificate to which an
Escrow Receipt is attached, each Holder of such an Applicable
Certificate acknowledges and accepts the restrictions on transfer
of the Escrow Receipt set forth herein and in the Escrow Agreement.
(e) (i) The Applicable Certificates shall be in the form
attached hereto as Exhibit A. Any Person acquiring or accepting an
Applicable Certificate or an interest therein will, by such
acquisition or acceptance, be deemed to represent and warrant that
either (i) the assets of an employee benefit plan subject to Title
I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or of a plan subject to Section 4975 of the
Internal Revenue Code of 1986, as amended (the "Code"), have not
been used to purchase Applicable Certificates or an interest
therein or (ii) the purchase and holding of Applicable Certificates
is exempt from the prohibited transaction restrictions of ERISA and
the Code pursuant to one or more prohibited transaction statutory
or administrative exemptions.
(ii) The Applicable Certificates shall be Book-Entry
Certificates and shall be subject to the conditions set forth in
the Letter of Representations between the Company and the Clearing
Agency attached hereto as Exhibit B.
(f) The Applicable Certificates are subject to the
Intercreditor Agreement, the Deposit Agreement and the Escrow
Agreement.
(g) The Applicable Certificates will have the benefit of the
Liquidity Facility.
(h) The Responsible Party is the Company.
(i) The particular "sections of the Note Purchase
Agreement", for purposes of clause (3) of Section 7.07 of the Basic
Agreement, are Section 6(b) (with respect to Owned Aircraft) and
Section 6(c) (with respect to Leased Aircraft) of the relevant
Participation Agreement attached as an exhibit to the Note Purchase
Agreement.
ARTICLE II
DEFINITIONS
Section 2.01. Definitions. For all purposes of the Basic
Agreement as supplemented by this Trust Supplement, the following
capitalized terms have the following meanings:
Agreement: Has the meaning specified in the recitals hereto.
Aircraft: Means each of the New Aircraft or Substitute
Aircraft in respect of which a Participation Agreement is entered
into in accordance with the Note Purchase Agreement.
Aircraft Purchase Agreement: Has the meaning specified in
the Note Purchase Agreement.
Applicable Certificateholder: Means the Person in whose name
an Applicable Certificate is registered on the Register for the
Applicable Certificates.
Applicable Delivery Date: Has the meaning specified in
Section 5.01(b) of this Trust Supplement.
Applicable Participation Agreement: Has the meaning
specified in Section 5.01(b) of this Trust Supplement.
AVSA: Means AVSA, S.A.R.L.
Business Day: Means any day other than a Saturday, a Sunday
or a day on which commercial banks are required or authorized to
close in New York, New York, Salt Lake City, Utah, Pittsburgh,
Pennsylvania, or, so long as any Applicable Certificate is
outstanding, the city and state in which the Trustee or any Loan
Trustee maintains its Corporate Trust Office or receives and
disburses funds.
Cut-off Date: Means the earlier of (a) the Delivery Period
Termination Date and (b) the date on which a Triggering Event
occurs.
Delivery Date: Has the meaning specified in the
Participation Agreements.
Delivery Notice: Has the meaning specified in the
Participation Agreements.
Delivery Period Termination Date: Means the earlier of (a)
July 20, 2000 and (b) the date on which Equipment Notes issued with
respect to all of the New Aircraft (or Substitute Aircraft in lieu
thereof) have been purchased by the Applicable Trust and the Other
Trusts in accordance with the Note Purchase Agreement.
Deposits: Has the meaning specified in the Deposit Agreement.
Deposit Agreement: Means the Deposit Agreement dated August
31, 1999 relating to the Applicable Certificates between the
Depositary and the Escrow Agent, as the same may be amended,
supplemented or otherwise modified from time to time in accordance
with its terms.
Depositary: Means ABN AMRO Bank, N.V., acting through its
Chicago branch.
Distribution Date: Means any Regular Distribution Date or
Special Distribution Date as the context requires.
Escrow Agent: Means, initially, First Security Bank,
National Association, and any replacement or successor therefor
appointed in accordance with the Escrow Agreement.
Escrow Agreement: Means the Escrow and Paying Agent
Agreement dated August 31, 1999 relating to the Applicable
Certificates, among the Escrow Agent, the Escrow Paying Agent, the
Trustee and Underwriters, as the same may be amended, supplemented
or otherwise modified from time to time in accordance with its
terms.
Escrow Paying Agent: Means the Person acting as paying agent
under the Escrow Agreement.
Escrow Receipt: Means the receipt substantially in the form
annexed to the Escrow Agreement representing a fractional undivided
interest in the funds held in escrow thereunder.
Final Withdrawal: Has the meaning specified in the Escrow
Agreement.
Final Withdrawal Date: Has the meaning specified in the
Escrow Agreement.
Final Withdrawal Notice: Has the meaning specified in
Section 5.02 of this Trust Supplement.
Indenture: Means each of the separate trust indentures and
mortgages relating to the Aircraft, each as specified or described
in a Delivery Notice delivered pursuant to the related
Participation Agreement, in each case as the same may be amended,
supplemented or otherwise modified from time to time in accordance
with its terms.
Intercreditor Agreement: Means the Intercreditor Agreement
dated August 31, 1999 among the Trustee, the Other Trustees, the
Liquidity Provider, the liquidity providers relating to the
Certificates issued under (and as defined in) each of the Other
Agreements, and State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent and as trustee
thereunder, as amended, supplemented or otherwise modified from
time to time in accordance with its terms.
Investors: Means the Underwriters together with all
subsequent beneficial owners of the Applicable Certificates.
Lease: Means, with respect to each Leased Aircraft, the
lease between an Owner Trustee, as the lessor, and the Company, as
the lessee, referred to in the related Indenture, as such lease may
be amended, supplemented or otherwise modified in accordance with
its terms.
Leased Aircraft: Has the meaning specified in the third
recital to this Trust Supplement.
Liquidity Facility: Means, initially, the Revolving Credit
Agreement dated August 31, 1999 relating to the Applicable
Certificates, between the Liquidity Provider and State Street Bank
and Trust Company of Connecticut, National Association, as
Subordination Agent, as agent and trustee for the Applicable Trust,
and, from and after the replacement of such agreement pursuant to
the Intercreditor Agreement, the replacement liquidity facility
therefor, in each case as amended, supplemented or otherwise
modified from time to time in accordance with their respective
terms.
Liquidity Provider: Means, initially, AIG Matched Funding
Corp., and any replacements or successors therefor appointed in
accordance with the Intercreditor Agreement.
New Aircraft: Has the meaning specified in the Note Purchase
Agreement.
Note Documents: Means the Note Purchase Agreement, this
Trust Supplement and, with respect to any Equipment Note, means (i)
the Indenture and the Participation Agreement relating to such
Equipment Note, and (ii) in the case of any Equipment Note related
to a Leased Aircraft, the Lease relating to such Leased Aircraft.
Note Purchase Agreement: Means the Note Purchase Agreement
dated August 31, 1999 among the Trustee, the Other Trustees, the
Company, the Escrow Agent, the Escrow Paying Agent and the
Subordination Agent, providing for, among other things, the
purchase of certain Equipment Notes by the Trustee on behalf of the
Trust, as the same may be amended, supplemented or otherwise
modified from time to time, in accordance with its terms.
Notice of Purchase Withdrawal: Has the meaning specified in
the Deposit Agreement.
Other Agreements: Means (i) the Basic Agreement as
supplemented by Trust Supplement No. 1999-1B dated the date hereof
relating to US Airways Pass Through Trust 1999-1B and (ii) the
Basic Agreement as supplemented by Trust Supplement 1999- 1C dated
the date hereof relating to US Airways Pass Through Trust 1999-1C.
Other Trustees: Means the trustees under the Other
Agreements, and any successor or other trustee appointed as
provided therein.
Other Trusts: Means the US Airways Pass Through Trust
1999-1B and the US Airways Pass Through Trust 1999-1C, each created
on the date hereof.
Owned Aircraft: Has the meaning specified in the third
recital to this Trust Supplement.
Owner Participant: With respect to any Equipment Note
relating to a Leased Aircraft, means the "Owner Participant" as
referred to in the Indenture pursuant to which such Equipment Note
is issued and any permitted successor or assign of such Owner
Participant; and Owner Participants at any time of determination
means all of the Owner Participants thus referred to in the
Indentures.
Owner Trustee: With respect to any Equipment Note relating
to a Leased Aircraft, means the "Owner Trustee", as referred to in
the Indenture pursuant to which such Equipment Note is issued, not
in its individual capacity but solely as trustee; and Owner
Trustees means all of the Owner Trustees party to any of the
Indentures.
Participation Agreement: Means each Participation Agreement
to be entered into by the Trustee pursuant to the Note Purchase
Agreement, as the same may be amended, supplemented or otherwise
modified in accordance with its terms.
Pool Balance: Means, as of any date, (i) the original
aggregate face amount of the Applicable Certificates less (ii) the
aggregate amount of all payments made in respect of such Applicable
Certificates or in respect of Deposits relating to the Applicable
Trust other than payments made in respect of interest or premium
thereon or reimbursement of any costs or expenses incurred in
connection therewith. The Pool Balance as of any Distribution Date
will be computed after giving effect to any special distribution
with respect to unused Deposits, payment of principal of the
Equipment Notes or payment with respect to other Trust Property and
the distribution thereof to be made on that date.
Pool Factor: Means, as of any Distribution Date, the
quotient (rounded to the seventh decimal place) computed by
dividing (i) the Pool Balance by (ii) the original aggregate face
amount of the Applicable Certificates. The Pool Factor as of any
Distribution Date shall be computed after giving effect to any
special distribution with respect to unused Deposits, payment of
principal of the Equipment Notes or other Trust Property and the
distribution thereof to be made on that date.
Prospectus Supplement: Means the Prospectus Supplement dated
August 24, 1999, relating to the offering of the Class A
Certificates and Class B Certificates (as each is defined in the
Intercreditor Agreement)
Special Redemption Premium: Means the premium payable by the
Company in respect of the Final Withdrawal pursuant to the Note
Purchase Agreement.
Special Payment: Means any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note or
Trust Indenture Estate (as defined in each Indenture) or Special
Redemption Premium.
Substitute Aircraft: Has the meaning specified in the Note
Purchase Agreement.
Triggering Event: Has the meaning assigned to such term in
the Intercreditor Agreement.
Trust Property: Means (i) subject to the Intercreditor
Agreement, the Equipment Notes held as the property of the
Applicable Trust, all monies at any time paid thereon and all
monies due and to become due thereunder, (ii) funds from time to
time deposited in the Certificate Account and the Special Payments
Account and, subject to the Intercreditor Agreement, any proceeds
from the sale by the Trustee pursuant to Article VI of the Basic
Agreement of any Equipment Note and (iii) all rights of the
Applicable Trust and the Trustee, on behalf of the Applicable
Trust, under the Intercreditor Agreement, the Escrow Agreement, the
Note Purchase Agreement and the Liquidity Facility, including,
without limitation, all rights to receive certain payments
thereunder, and all monies paid to the Trustee on behalf of the
Applicable Trust pursuant to the Intercreditor Agreement or the
Liquidity Facility, provided that rights with respect to the
Deposits or under the Escrow Agreement, except for the right to
direct withdrawals for the purchase of Equipment Notes to be held
herein, will not constitute Trust Property.
Underwriters: Means, collectively, Credit Suisse First
Boston Corporation, Goldman, Sachs & Co., Donaldson Lufkin &
Jenrette Securities Corporation, Deutsche Bank Securities Inc., and
Salomon Smith Barney Inc..
Underwriting Agreement: Means the Underwriting Agreement
dated August 24, 1999 among the Underwriters and the Company, as
the same may be amended, supplemented or otherwise modified from
time to time in accordance with its terms.
ARTICLE III
DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 3.01. Additions to Article IV of the Basic
Agreement. In addition to the provisions of Article IV of the Basic
Agreement, the following provisions shall apply to the Applicable Trust:
(a) Upon the payment of Special Redemption Premium to the
Trustee under the Note Purchase Agreement, the Trustee, upon
receipt thereof, shall immediately deposit the aggregate amount of
such Special Redemption Premium in the Special Payments Account;
(b) The distribution of amounts of Special Redemption
Premium as provided for in Section 4.02(b) of the Basic Agreement
shall be on the Special Distribution Date with respect to such
Special Payment or as soon thereafter as the Trustee has confirmed
receipt of the related Special Redemption Premium;
(c) In the event of the payment of a Special Redemption
Premium by the Company to the Trustee under the Note Purchase
Agreement, the notice provided for in Section 4.02(c) of the Basic
Agreement shall be mailed, together with the notice by the Escrow
Paying Agent under Section 2.06 of the Escrow Agreement, not less
than 15 days prior to the Special Distribution Date for such
amount, which Special Distribution Date shall be the Final
Withdrawal Date; and
(d) The last sentence of the first paragraph of Section
4.02(c) of the Basic Agreement shall apply equally if the amount of
Special Redemption Premium, if any, has not been calculated at the
time the Trustee mails notice of a Special Payment.
Section 3.02. Statements to Applicable Certificateholders.
(a) On each Distribution Date, the Trustee will include with each
distribution to Applicable Certificateholders of a Scheduled Payment or
Special Payment, as the case may be, a statement setting forth the
information provided below (in the case of a Special Payment, including any
Special Redemption Premium, reflecting in part the information provided by
the Escrow Paying Agent under the Escrow Agreement). Such statement shall
set forth (per $1,000 face amount Applicable Certificate as to (ii), (iii),
(iv) and (v) below) the following information:
(i) the aggregate amount of funds distributed on such
Distribution Date under the Agreement and under the Escrow
Agreement, indicating the amount allocable to each source;
(ii) the amount of such distribution under the Agreement
allocable to principal and the amount allocable to premium
(including the Special Redemption Premium), if any;
(iii) the amount of such distribution under the Agreement
allocable to interest;
(iv) the amount of such distribution under the Escrow
Agreement allocable to interest;
(v) the amount of such distribution under the Escrow
Agreement allocable to Deposits; and
(vi) the Pool Balance and the Pool Factor.
With respect to the Applicable Certificates registered in
the name of a Clearing Agency, on the Record Date prior to each
Distribution Date, the Trustee will request from such Clearing Agency a
securities position listing setting forth the names of all Clearing Agency
Participants reflected on such Clearing Agency's books as holding interests
in the Applicable Certificates on such Record Date. On each Distribution
Date, the Trustee will mail to each such Clearing Agency Participant the
statement described above and will make available additional copies as
requested by such Clearing Agency Participant for forwarding to holders of
interests in the Applicable Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the
Trustee shall furnish to each Person who at any time during such calendar
year was an Applicable Certificateholder of record a statement containing
the sum of the amounts determined pursuant to clauses (a)(i), (a)(ii),
(a)(iii), (a)(iv) and (a)(v) above for such calendar year or, in the event
such Person was an Applicable Certificateholder of record during a portion
of such calendar year, for such portion of such year, and such other items
as are readily available to the Trustee and which an Applicable
Certificateholder shall reasonably request as necessary for the purpose of
such Applicable Certificateholder's preparation of its federal income tax
returns. Such statement and such other items shall be prepared on the basis
of information supplied to the Trustee by the Clearing Agency Participants
and shall be delivered by the Trustee to such Clearing Agency Participants
to be available for forwarding by such Clearing Agency Participants to the
holders of interests in the Applicable Certificates in the manner described
in Section 3.02(a) of this Trust Supplement.
(c) Promptly following (i) the Delivery Period Termination
Date, if there has been any change in the information set forth in clauses
(x), (y) and (z) below from that set forth in page S-42 of the Prospectus
Supplement, and (ii) any early redemption or purchase of, or any default in
the payment of principal or interest in respect of, any of the Equipment
Notes held in the Applicable Trust, or any Final Withdrawal, the Trustee
shall furnish to Applicable Certificateholders of record on such date a
statement setting forth (x) the expected Pool Balances for each subsequent
Regular Distribution Date following the Delivery Period Termination Date,
(y) the related Pool Factors for such Regular Distribution Dates and (z)
the expected principal distribution schedule of the Equipment Notes, in the
aggregate, held as Trust Property at the date of such notice. With respect
to the Applicable Certificates registered in the name of a Clearing Agency,
on the Delivery Period Termination Date, the Trustee will request from such
Clearing Agency a securities position listing setting forth the names of
all Clearing Agency Participants reflected on such Clearing Agency's books
as holding interests in the Applicable Certificates on such date. The
Trustee will mail to each such Clearing Agency Participant the statement
described above and will make available additional copies as requested by
such Clearing Agency Participant for forwarding to holders of interests in
the Applicable Certificates.
(d) This Section 3.02 supersedes and replaces Section 4.03
of the Basic Agreement.
ARTICLE IV
DEFAULT
Section 4.01. Purchase Rights of Certificateholders. (a) By
acceptance of its Applicable Certificate, each Applicable Certificateholder
agrees that at any time after the occurrence and during the continuation of
a Triggering Event,
(i) each Class B Certificateholder shall have the right to
purchase all, but not less than all, of the Applicable Certificates
upon ten (10) days' written notice to the Trustee and each other
Class B Certificateholder, provided that (A) if prior to the end of
such ten-day period any other Class B Certificateholder notifies
such purchasing Class B Certificateholder that such other Class B
Certificateholder wants to participate in such purchase, then such
other Class B Certificateholder may join with the purchasing Class
B Certificateholder to purchase all, but not less than all, of the
Applicable Certificates pro rata based on the Fractional Undivided
Interest in the Class B Trust held by each such Class B
Certificateholder and (B) if prior to the end of such ten-day
period any other Class B Certificateholder fails to notify the
purchasing Class B Certificateholder of such other Class B
Certificateholder's desire to participate in such a purchase, then
such other Class B Certificateholder shall lose its right to
purchase the Applicable Certificates pursuant to this Section
4.01(a); and
(ii) each Class C Certificateholder shall have the right
(which shall not expire upon any purchase of the Applicable
Certificates pursuant to clause (i) above) to purchase all, but not
less than all, of the Applicable Certificates and the Class B
Certificates upon ten days' written notice to the Trustee, the
Class B Trustee and each other Class C Certificateholder, provided
that (A) if prior to the end of such ten-day period any other Class
C Certificateholder notifies such purchasing Class C
Certificateholder that such other Class C Certificateholder wants
to participate in such purchase, then such other Class C
Certificateholder may join with the purchasing Class C
Certificateholder to purchase all, but not less than all, of the
Certificates and the Class B Certificates pro rata based on the
Fractional Undivided Interest in the Class C Trust held by each
such Class C Certificateholder and (B) if prior to the end of such
ten-day period any other Class C Certificateholder fails to notify
the purchasing Class C Certificateholder of such other Class C
Certificateholder's desire to participate in such a purchase, then
such other Class C Certificateholder shall lose its right to
purchase the Applicable Certificates pursuant to this Section
4.01(a).
The purchase price with respect to the Applicable
Certificates shall be equal to the Pool Balance of the Applicable
Certificates, together with accrued and unpaid interest thereon to the date
of such purchase, without premium, but including any other amounts then due
and payable to the Applicable Certificateholders under this Agreement, the
Intercreditor Agreement, the Escrow Agreement or any Note Document or on or
in respect of the Applicable Certificates; provided, however, that (i) if
such purchase occurs after the record date specified in Section 2.03(b) of
the Escrow Agreement relating to the distribution of unused Deposits and
accrued and unpaid interest thereunder, such purchase price shall be
reduced by the aggregate amount of unused Deposits and interest to be
distributed under the Escrow Agreement (which deducted amounts shall remain
distributable to, and may be retained by, the Applicable Certificateholder
as of such Record Date) and (ii) if such purchase occurs after a Record
Date, such purchase price shall be reduced by the amount to be distributed
hereunder on the related Distribution Date (which deducted amounts shall
remain distributable to, and may be retained by, the Applicable
Certificateholder as of such Record Date); provided further that no such
purchase of Applicable Certificates shall be effective unless the
purchaser(s) shall certify to the Trustee that contemporaneously with such
purchase, such purchaser(s) is purchasing, pursuant to the terms of this
Agreement and the Other Agreements, the Applicable Certificates and the
Class B Certificates which are senior to the securities held by such
purchaser(s). Each payment of the purchase price of the Applicable
Certificates referred to in the first sentence hereof shall be made to an
account or accounts designated by the Trustee and each such purchase shall
be subject to the terms of this Section 4.01(a). Each Applicable
Certificateholder agrees by its acceptance of its Applicable Certificate
that it will, subject to Section 3.04 of the Basic Agreement, upon payment
from such Class B Certificateholder(s) or Class C Certificateholder(s), as
the case may be, of the purchase price set forth in the first sentence of
this paragraph, forthwith sell, assign, transfer and convey to the
purchaser(s) thereof (without recourse, representation or warranty of any
kind except for its own acts), all of the right, title, interest and
obligation of such Applicable Certificateholder in this Agreement, the
Escrow Agreement, the Deposit Agreement, the Intercreditor Agreement, the
Liquidity Facility, the Note Documents and all Applicable Certificates and
Escrow Receipts held by such Applicable Certificateholder (excluding all
right, title and interest under any of the foregoing to the extent such
right, title or interest is with respect to an obligation not then due and
payable as respects any action or inaction or state of affairs occurring
prior to such sale) and the purchaser shall assume all of such Applicable
Certificateholder's obligations under this Agreement, the Escrow Agreement,
the Deposit Agreement, the Intercreditor Agreement, the Liquidity Facility,
the Note Documents and all such Applicable Certificates and Escrow
Receipts. The Applicable Certificates will be deemed to be purchased on the
date payment of the purchase price is made notwithstanding the failure of
the Applicable Certificateholders to deliver any Applicable Certificates
and, upon such a purchase, (i) the only rights of the Applicable
Certificateholders will be to deliver the Applicable Certificates to the
purchaser(s) and receive the purchase price for such Applicable
Certificates and (ii) if the purchaser(s) shall so request, such Applicable
Certificateholder will comply with all the provisions of Section 3.04 of
the Basic Agreement to enable new Applicable Certificates to be issued to
the purchaser in such denominations as it shall request. All charges and
expenses in connection with the issuance of any such new Applicable
Certificates shall be borne by the purchaser thereof.
As used in this Section 4.01(a), the terms "Class B
Certificateholder", "Class B Trust", "Class B Certificate", "Class B
Trustee", "Class C Certificateholder", "Class C Trust", "Class C
Certificate" and "Class C Trustee" shall have the respective meanings
assigned to such terms in the Intercreditor Agreement.
(b) This Section 4.01 supersedes and replaces Section
6.01(b) of the Basic Agreement.
ARTICLE V
THE TRUSTEE
Section 5.01. Delivery of Documents; Delivery Dates. (a) The
Trustee is hereby directed (i) to execute and deliver the Intercreditor
Agreement, the Escrow Agreement and the Note Purchase Agreement, each in
the form delivered to the Trustee by the Company and (ii) subject to the
respective terms thereof, to perform its obligations thereunder. Upon
request of the Company and the satisfaction or waiver of the closing
conditions specified in the Underwriting Agreement, the Trustee shall
execute, deliver, authenticate, issue and sell Applicable Certificates in
authorized denominations equaling in the aggregate the amount set forth,
with respect to the Applicable Trust, in Schedule I to the Underwriting
Agreement evidencing the entire ownership interest in the Applicable Trust,
which amount equals the maximum aggregate principal amount of Equipment
Notes which may be purchased by the Trustee pursuant to the Note Purchase
Agreement. Except as provided in Sections 3.03, 3.04, 3.05 and 3.06 of the
Basic Agreement, the Trustee shall not execute, authenticate or deliver
Applicable Certificates in excess of the aggregate amount specified in this
paragraph.
(b) On or after the Issuance Date the Company may deliver
from time to time to the Trustee a Delivery Notice relating to one or more
Equipment Notes. After receipt of a Delivery Notice and in any case no
later than one Business Day prior to a Delivery Date as to which such
Delivery Notice relates (the "Applicable Delivery Date"), the Trustee shall
(as and when specified in the Delivery Notice) instruct the Escrow Agent to
provide a Notice of Purchase Withdrawal to the Depositary requesting (A)
the withdrawal of one or more Deposits on the Applicable Delivery Date in
accordance with and to the extent permitted by the terms of the Escrow
Agreement and the Deposit Agreement and (B) the payment of all, or a
portion, of such Deposit or Deposits in an amount equal in the aggregate to
the purchase price of such Equipment Notes to or on behalf of the Owner
Trustee or the Company, as the case may be, issuing such Equipment Notes,
all as shall be described in the Delivery Notice. The Trustee shall (as and
when specified in such Delivery Notice), subject to the conditions set
forth in Section 3 of the Note Purchase Agreement, enter into and perform
its obligations under the Participation Agreement specified in such
Delivery Notice (the "Applicable Participation Agreement") and cause such
certificates, documents and legal opinions relating to the Trustee to be
duly delivered as required by the Applicable Participation Agreement. If at
any time prior to the Applicable Delivery Date, the Trustee receives a
notice of postponement pursuant to Section 2(e), 2(f), or 2(g) of the Note
Purchase Agreement, then the Trustee shall give the Depositary (with a copy
to the Escrow Agent) a notice of cancellation of such Notice of Purchase
Withdrawal relating to such Deposit or Deposits on such Applicable Delivery
Date. Upon satisfaction of the conditions specified in the Note Purchase
Agreement and the Applicable Participation Agreement, the Trustee shall
purchase the applicable Equipment Notes with the proceeds of the
withdrawals of one or more Deposits made on the Applicable Delivery Date in
accordance with the terms of the Deposit Agreement and the Escrow
Agreement. The purchase price of such Equipment Notes shall equal the
principal amount of such Equipment Notes. Amounts withdrawn from such
Deposit or Deposits in excess of the purchase price of the Equipment Notes
or to the extent not applied on the Applicable Delivery Date to the
purchase price of the Equipment Notes, shall be re-deposited by the Trustee
with the Depositary on the Applicable Delivery Date in accordance with the
terms of the Deposit Agreement. The provisions of this Section 5.01(b) and
Section 5.01(c) hereof supersede and replace the provisions of Section 2.02
of the Basic Agreement (which are inapplicable to the Trust), and all
provisions of the Basic Agreement relating to Section 2.02 of the Basic
Agreement shall not apply to the Applicable Trust.
Section 5.02. Withdrawal of Deposits. If any Deposits remain
outstanding on the Business Day next succeeding the Cut-off Date, (i) the
Trustee shall give the Escrow Agent notice that the Trustee's obligation to
purchase Equipment Notes under the Note Purchase Agreement has terminated
and instruct the Escrow Agent to provide a notice of Final Withdrawal to
the Depositary substantially in the form of Exhibit B to the Deposit
Agreement (the "Final Withdrawal Notice") and (ii) the Trustee will make a
demand upon the Company under the Note Purchase Agreement for an amount
equal to the Special Redemption Premium, such payment to be made on the
Final Withdrawal Date.
Section 5.03. The Trustee. (a) Subject to Section 5.04 of
this Trust Supplement and Section 7.15 of the Basic Agreement, the Trustee
shall not be responsible in any manner whatsoever for or in respect of the
validity or sufficiency of this Trust Supplement, the Deposit Agreement or
the Escrow Agreement or the due execution hereof or thereof by the Company
or the other parties thereto (other than the Trustee), or for or in respect
of the recitals and statements contained herein or therein, all of which
recitals and statements are made solely by the Company.
(b) Except as herein otherwise provided, no duties,
responsibilities or liabilities are assumed, or shall be construed to be
assumed by the Trustee by reason of this Trust Supplement other than as set
forth in the Basic Agreement, and this Trust Supplement is executed and
accepted on behalf of the Trustee, subject to all the terms and conditions
set forth in the Basic Agreement, upon the effectiveness thereof, as fully
to all intents as if the same were herein set forth at length.
Section 5.04. Representations and Warranties of the Trustee.
The Trustee hereby represents and warrants that:
(a) the Trustee has full power, authority and legal right to
execute, deliver and perform this Trust Supplement, the
Intercreditor Agreement, the Escrow Agreement and the Note
Documents to which it is a party and has taken all necessary action
to authorize the execution, delivery and performance by it of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement
and the Note Documents to which it is a party;
(b) the execution, delivery and performance by the Trustee
of this Trust Supplement, the Intercreditor Agreement, the Escrow
Agreement and the Note Documents to which it is a party (i) will
not violate any provision of any United States federal law or the
law of the state of the United States where it is located governing
the banking and trust powers of the Trustee or any order, writ,
judgment, or decree of any court, arbitrator or governmental
authority applicable to the Trustee or any of its assets, (ii) will
not violate any provision of the articles of association or by-laws
of the Trustee, and (iii) will not violate any provision of, or
constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of any lien on any
properties included in the Trust Property pursuant to the
provisions of any mortgage, indenture, contract, agreement or other
undertaking to which it is a party, which violation, default or
lien could reasonably be expected to have an adverse effect on the
Trustee's performance or ability to perform its duties hereunder or
thereunder or on the transactions contemplated herein or therein;
(c) the execution, delivery and performance by the Trustee
of this Trust Supplement, the Intercreditor Agreement, the Escrow
Agreement and the Note Documents to which it is a party will not
require the authorization, consent, or approval of, the giving of
notice to, the filing or registration with, or the taking of any
other action in respect of, any governmental authority or agency of
the United States or the state of the United States where it is
located regulating the banking and corporate trust activities of
the Trustee; and
(d) this Trust Supplement, the Intercreditor Agreement, the
Escrow Agreement and the Note Documents to which it is a party have
been, or will be, as applicable, duly executed and delivered by the
Trustee and constitute, or will constitute, as applicable, the
legal, valid and binding agreements of the Trustee, enforceable
against it in accordance with their respective terms; provided,
however, that enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and (ii) general
principles of equity.
Section 5.05. Trustee Liens. The Trustee in its individual
capacity agrees, in addition to the agreements contained in Section 7.17 of
the Basic Agreement, that it will at its own cost and expense promptly take
any action as may be necessary to duly discharge and satisfy in full any
Trustee's Liens on or with respect to the Trust Property which is
attributable to the Trustee in its individual capacity and which is
unrelated to the transactions contemplated by the Intercreditor Agreement
or the Note Purchase Agreement.
ARTICLE VI
SUPPLEMENTAL AGREEMENTS
Section 6.01. Supplemental Agreements Without Consent of
Applicable Certificateholders. Under the terms of, and subject to the
limitations contained in, Section 9.01 of the Basic Agreement, the Company
may (but will not be required to), and the Trustee (subject to Section 9.03
of the Basic Agreement) shall, at the Company's request, at any time and
from time to time, enter into one or more agreements supplemental to the
Escrow Agreement, the Note Purchase Agreement or the Deposit Agreement, for
any of the purposes set forth in clauses (1) through (9) of such Section
9.01, except that (a) clause (3) of such Section 9.01 shall be deemed to
include the Company's rights and powers conferred by the Note Purchase
Agreement and (b) clause (4) of such Section 9.01 shall be deemed to
include corrections or supplements to provisions of the Escrow Agreement or
the Deposit Agreement which may be defective or inconsistent with any other
provision of this Agreement or contained in any agreement referred to in
such clause (4) and the curing of any ambiguity or the modification of any
other provision with respect to matters or questions arising under the
Escrow Agreement or the Deposit Agreement.
Section 6.02. Supplemental Agreements with Consent of
Applicable Certificateholders. The provisions of Section 9.02 of the Basic
Agreement shall apply to agreements or amendments for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of the Escrow Agreement, the Deposit Agreement or the Note
Purchase Agreement to the extent applicable to the Applicable
Certificateholders approving such agreement or amendment or modifying in
any manner the rights and obligations of such Applicable Certificateholders
under the Escrow Agreement, the Deposit Agreement or the Note Purchase
Agreement; provided that the provisions of Section 9.02(1) of the Basic
Agreement shall be deemed to include reductions in any manner of, or delay
in the timing of, any receipt by the Applicable Certificateholders of
payments upon the Deposits; provided, further, that the provisions of
Section 9.02(6) of the Basic Agreement shall not apply to the Applicable
Trust and any supplemental agreement having the effect described in said
Section 9.02(6) shall require only the consent of Applicable
Certificateholders holding Applicable Certificates evidencing a Fractional
Undivided Interest aggregating not less than a majority in interest in the
Applicable Trust.
ARTICLE VII
TERMINATION OF TRUST
Section 7.01. Termination of the Trust. The respective
obligations and responsibilities of the Company and the Trustee with
respect to the Applicable Trust shall terminate upon the distribution to
all Applicable Certificateholders and the Trustee of all amounts required
to be distributed to them pursuant to this Agreement and the disposition of
all property held as part of the Trust Property; provided, however, that in
no event shall the Applicable Trust continue beyond 21 years less one day
following the death of the last survivor of all descendants living on the
date hereof of Joseph P. Kennedy, Sr., unless applicable law shall permit a
longer term, in which case such longer term shall apply.
Notice of any termination, specifying the Distribution Date
upon which the Applicable Certificateholders may surrender their Applicable
Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Applicable
Certificateholders not earlier than the 60th day and not later than the
15th day next preceding such final Distribution Date specifying (A) the
Distribution Date upon which the proposed final payment of the Applicable
Certificates will be made upon presentation and surrender of Applicable
Certificates at the office or agency of the Trustee therein specified, (B)
the amount of any such proposed final payment, and (c) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Applicable
Certificates at the office or agency of the Trustee therein specified. The
Trustee shall give such notice to the Registrar at the time such notice is
given to Applicable Certificateholders. Upon presentation and surrender of
the Applicable Certificates in accordance with such notice, the Trustee
shall cause to be distributed to Applicable Certificateholders such final
payments.
In the event that all of the Applicable Certificateholders
shall not surrender their Applicable Certificates for cancellation within
six months after the date specified in the above-mentioned written notice,
the Trustee shall give a second written notice to the remaining Applicable
Certificateholders to surrender their Applicable Certificates for
cancellation and receive the final distribution with respect thereto. No
additional interest shall accrue on the Applicable Certificates after the
Distribution Date specified in the first written notice. In the event that
any money held by the Trustee for the payment of distributions on the
Applicable Certificates shall remain unclaimed for two years (or such
lesser time as the Trustee shall be satisfied, after sixty days' notice
from the Company, is one month prior to the escheat period provided under
applicable law) after the final distribution date with respect thereto, the
Trustee shall pay to each Loan Trustee the appropriate amount of money
relating to such Loan Trustee and shall give written notice thereof to the
related Owner Trustees, the Owner Participants and the Company.
ARTICLE VIII
THE COMPANY
Section 8.01. Consolidation, Mergers, Etc. Section 5.02 of
the Basic Agreement is hereby amended with respect to the Applicable Trust
by deleting the word "and" at the end of clause (b) thereof, renumbering
clause (c) as clause "(d)" and inserting a new clause (c) as follows:
"(c) immediately after giving effect to such transaction, no
Indenture Event of Default (in the case of an Owned Aircraft) or,
in the case of a Leased Aircraft, Lease Event of Default (as
defined in the related Indenture) shall have occurred and be
continuing; and"
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Basic Agreement Ratified. Except and so far as
herein expressly provided, all of the provisions, terms and conditions of
the Basic Agreement are in all respects ratified and confirmed; and the
Basic Agreement and this Trust Supplement shall be taken, read and
construed as one and the same instrument.
Section 9.02. GOVERNING LAW. THIS AGREEMENT AND THE
APPLICABLE CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 9.03. Execution in Counterparts. This Trust
Supplement may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute but
one and the same instrument.
Section 9.04. Intention of Parties. The parties hereto
intend that the Applicable Trust be classified for U.S. federal income tax
purposes as a grantor trust under Subpart E, Part I of Subchapter J of the
Internal Revenue Code of 1986, as amended, and not as a trust or
association taxable as a corporation or as a partnership. Each Applicable
Certificateholder and Investor, by its acceptance of its Applicable
Certificate or a beneficial interest therein, agrees to treat the
Applicable Trust as a grantor trust for all U.S. federal, state and local
income tax purposes. The powers granted and obligations undertaken pursuant
to the Agreement shall be so construed so as to further such intent.
IN WITNESS WHEREOF, the Company and the Trustee have caused
this Trust Supplement to be duly executed by their respective officers
thereto duly authorized, as of the day and year first written above.
US AIRWAYS, INC.
By:/s/ Jeffery A. McDougle
__________________________
Name: Jeffery A. McDougle
Title: Vice President and
Treasurer
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as
Trustee
By:/s/ John G. Correia
___________________________
Name: John G. Correia
Title:Assistant Secretary
EXHIBIT A
FORM OF CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.*
US AIRWAYS ____________ PASS THROUGH TRUST
*This legend to appear on Book-Entry Certificates to be deposited
with The Depository Trust Company.
Pass Through Certificate, Series __________
Final Expected Regular Distribution Date: _____,
____ evidencing a fractional undivided interest in
a trust, the property of which includes certain
equipment notes each secured by Aircraft owned by
or leased to US Airways, Inc.
Certificate
No.______ $__________ Fractional Undivided Interest representing
._____% of the Trust per $1,000 face amount
THIS CERTIFIES THAT __________________, for value received, is the
registered owner of a $___________ (________ dollars) Fractional Undivided
Interest in the US Airways Pass Through Trust, Series [___] (the "Trust")
created by State Street Bank and Trust Company of Connecticut, National
Association, as trustee (the "Trustee"), pursuant to a Pass Through Trust
Agreement dated as of __________, 1999 (the "Basic Agreement"), between the
Trustee, US Airways, Inc., a corporation incorporated under Delaware law
(the "Company") and US Airways Group, Inc., a corporation incorporated
under Delaware law (the "Parent"), as supplemented by Trust Supplement No.
_______ thereto dated __________, ____, between the Trustee and the Company
(collectively, the "Agreement"), a summary of certain of the pertinent
- -------- provisions of which is set forth below. To the extent not
otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Agreement. This Certificate is one of the
duly authorized Certificates designated as "___% US Airways Pass Through
Certificate, Series ____" (herein called the "Certificates"). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement. By virtue of its acceptance hereof, the
Certificateholder of this Certificate assents to and agrees to be bound by
the provisions of the Agreement and any related Intercreditor Agreement.
The property of the Trust includes certain Equipment Notes and all rights
of the Trust to receive any payments under any Intercreditor Agreement or
Liquidity Facility (the "Trust Property"). Each issue of the Equipment
Notes is or will be secured by, among other things, a security interest in
aircraft leased to or owned by the Company.
The Certificates represent Fractional Undivided Interests in the
Trust and the Trust Property, and have no rights, benefits or interest in
respect of any other separate trust established pursuant to the terms of
the Basic Agreement for any other series of certificates issued pursuant
thereto.
Subject to and in accordance with the terms of the Agreement and
any related Intercreditor Agreement, from funds then available to the
Trustee, there will be distributed on each __________ and ___________ (a
"Regular Distribution Date"), commencing on _________, ____, to the Person
in whose name this Certificate is registered at the close of business on
the 15th day preceding the Regular Distribution Date, an amount in respect
of the Scheduled Payments on the Equipment Notes due on such Regular
Distribution Date, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Scheduled Payments.
Subject to and in accordance with the terms of the Agreement and any
related Intercreditor Agreement, in the event that Special Payments on the
Equipment Notes are received by the Trustee, from funds then available to
the Trustee, there shall be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Special Payments so
received. If a Regular Distribution Date or Special Distribution Date is
not a Business Day, distribution shall be made on the immediately following
Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the Trustee by
check mailed to the Person entitled thereto, without the presentation or
surrender of this Certificate or the making of any notation hereon, except
that with respect to Certificates registered on the Record Date in the name
of a Clearing Agency (or its nominee), such distribution shall be made by
wire transfer. Except as otherwise provided in the Agreement and
notwithstanding the above, the final distribution on this Certificate will
be made after notice mailed by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate
at the office or agency of the Trustee specified in such notice.
The Certificates do not represent a direct obligation of, or an
obligation guaranteed by, or an interest in, the Company or the Trustee or
any affiliate thereof. The Certificates are limited in right of payment,
all as more specifically set forth on the face hereof and in the Agreement.
All payments or distributions made to Certificateholders under the
Agreement shall be made only from the Trust Property and only to the extent
that the Trustee shall have sufficient income or proceeds from the Trust
Property to make such payments in accordance with the terms of the
Agreement. Each Certificateholder of this Certificate, by its acceptance
hereof, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement
for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by
any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Certificateholders under the Agreement at
any time by the Company and the Trustee with the consent of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust.
Any such consent by the Certificateholder of this Certificate shall be
conclusive and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without
the consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain limitations set
forth, the transfer of this Certificate is registrable in the Register upon
surrender of this Certificate for registration of transfer at the offices
or agencies maintained by the Trustee in its capacity as Registrar, or by
any successor Registrar duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the
Registrar, duly executed by the Certificateholder hereof or such
Certificateholder's attorney duly authorized in writing, and thereupon one
or more new Certificates of authorized denominations evidencing the same
aggregate Fractional Undivided Interest in the Trust will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in minimum denominations of $1,000 Fractional Undivided
Interest and integral multiples thereof except that one Certificate may be
issued in a different denomination. As provided in the Agreement and
subject to certain limitations therein set forth, the Certificates are
exchangeable for new Certificates of authorized denominations evidencing
the same aggregate Fractional Undivided Interest in the Trust, as requested
by the Certificateholder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee shall require payment of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
Each Certificateholder and Investor, by its acceptance of this
Certificate or a beneficial interest herein, agrees to treat the Trust as a
grantor trust for all U.S. federal, state and local income tax purposes.
The Trustee, the Registrar, and any agent of the Trustee or the
Registrar may treat the person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Trustee, the
Registrar, nor any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the Agreement and
the Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them
pursuant to the Agreement and the disposition of all property held as part
of the Trust Property.
Any Person acquiring or accepting this Certificate or an interest
herein will, by such acquisition or acceptance, be deemed to have
represented and warranted that either: (i) the assets of an employee
benefit plan subject to Title I of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or of a plan subject to Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code"), have not been
used to purchase this Certificate or an interest herein or (ii) the
purchase and holding of this Certificate or interest herein are exempt from
the prohibited transaction restrictions of ERISA and the Code pursuant to
one or more prohibited transaction statutory or administrative exemptions.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been executed
by the Trustee, by manual signature, this Certificate shall not be entitled
to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
US AIRWAYS PASS THROUGH TRUST
By: STATE STREET BANK AND
TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as
Trustee
By:_____________________________
Title:__________________________
Dated:_____________________
FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as
Trustee
By:___________________________
Authorized Officer
EXHIBIT B
[DTC Letter of Representations]
Exhibit 4(a)(iii)
TRUST SUPPLEMENT No. 1999-1B
Dated as of August 31, 1999
between
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Trustee,
and
US AIRWAYS, INC.
to
PASS THROUGH TRUST AGREEMENT
Dated as of July 30, 1999
US Airways Pass Through Trust 1999-1B
9.01% US Airways
Pass Through Certificates,
Series 1999-1B
This Trust Supplement No. 1999-1B, dated as of August 31,
1999 (herein called the "Trust Supplement"), between US Airways, Inc., a
Delaware corporation (the "Company") and State Street Bank and Trust
Company of Connecticut, National Association (the "Trustee"), to the Pass
Through Trust Agreement, dated as of July 30, 1999, between the Company, US
Airways Group, Inc., a Delaware corporation, and the Trustee (the "Basic
Agreement").
W I T N E S S E T H:
WHEREAS, the Basic Agreement, unlimited as to the aggregate
principal amount of Certificates (unless otherwise specified herein,
capitalized terms used herein without definition having the respective
meanings specified in the Basic Agreement) which may be issued thereunder,
has heretofore been executed and delivered;
WHEREAS, the Company obtained commitments from AVSA for the
delivery of 20 Aircraft;
WHEREAS, the Company intends to finance the acquisition of
each such Aircraft either (i) through separate leveraged lease
transactions, in which case the Company will lease such Aircraft
(collectively, the "Leased Aircraft") or (ii) through separate secured loan
transactions, in which case the Company will own such Aircraft
(collectively, the "Owned Aircraft");
WHEREAS, in the case of each Leased Aircraft, each Owner
Trustee, acting on behalf of the corresponding Owner Participant, will
issue pursuant to an Indenture, on a non-recourse basis, Equipment Notes in
order to finance a portion of its purchase price of such Leased Aircraft;
WHEREAS, in the case of each Owned Aircraft, the Company
will issue pursuant to an Indenture, on a recourse basis, Equipment Notes
to finance a portion of the purchase price of such Owned Aircraft;
WHEREAS, the Trustee hereby declares the creation of this US
Airways Pass Through Trust 1999-1B (the "Applicable Trust") for the benefit
of the Applicable Certificateholders, and the initial Applicable
Certificateholders as the grantors of the Applicable Trust, by their
respective acceptances of the Applicable Certificates, join in the creation
of the Applicable Trust with the Trustee;
WHEREAS, all Certificates to be issued by the Applicable
Trust will evidence fractional undivided interests in the Applicable Trust
and will convey no rights, benefits or interests in respect of any property
other than the Trust Property except for those Certificates to which an
Escrow Receipt has been affixed;
WHEREAS, the Escrow Agent, the Trustee, the Escrow Paying
Agent, and the Underwriters have contemporaneously herewith entered into an
Escrow Agreement with the Escrow Paying Agent pursuant to which the
Underwriters have delivered to the Escrow Agent the proceeds from the sale
of the Applicable Certificates and have irrevocably instructed the Escrow
Agent to withdraw and pay funds from such proceeds upon request and proper
certification by the Trustee to purchase Equipment Notes as the Aircraft
are delivered by AVSA under the Aircraft Purchase Agreement from time to
time prior to the Delivery Period Termination Date;
WHEREAS, the Escrow Agent on behalf of the Applicable
Certificateholders has contemporaneously herewith entered into a Deposit
Agreement with the Depositary under which the Deposits referred to therein
will be made and from which it will withdraw funds to allow the Trustee to
purchase Equipment Notes from time to time prior to the Delivery Period
Termination Date;
WHEREAS, pursuant to the terms and conditions of the Basic
Agreement as supplemented by this Trust Supplement (the "Agreement") and
the Note Purchase Agreement, the Trustee on behalf of the Applicable Trust,
using funds withdrawn under the Escrow Agreement, shall purchase one or
more Equipment Notes having the same interest rate as, and final maturity
date not later than the final Regular Distribution Date of, the Applicable
Certificates issued hereunder and, in each case, shall hold such Equipment
Notes in trust for the benefit of the Applicable Certificateholders;
WHEREAS, all of the conditions and requirements necessary to
make this Trust Supplement, when duly executed and delivered, a valid,
binding and legal instrument in accordance with its terms and for the
purposes herein expressed, have been done, performed and fulfilled, and the
execution and delivery of this Trust Supplement in the form and with the
terms hereof have been in all respects duly authorized; and
WHEREAS, this Trust Supplement is subject to the provisions
of the Trust Indenture Act of 1939, as amended, and shall, to the extent
applicable, be governed by such provisions;
NOW THEREFORE, in consideration of the premises herein, it
is agreed between the Company and the Trustee as follows:
ARTICLE I
THE CERTIFICATES
Section 1.01. The Certificates. There is hereby created a
series of Certificates to be issued under the Agreement to be distinguished
and known as "9.01% US Airways Pass Through Certificates, Series 1999-1B"
(hereinafter defined as the "Applicable Certificates"). Each Applicable
Certificate represents a fractional undivided interest in the Applicable
Trust created hereby. The Applicable Certificates shall be the only
instruments evidencing a fractional undivided interest in the Applicable
Trust.
The terms and conditions applicable to the Applicable
Certificates are as follows:
(a) The aggregate principal amount of the Applicable
Certificates that shall be authenticated under the Agreement
(except for Applicable Certificates authenticated and delivered
pursuant to Sections 3.03, 3.04 and 3.06 of the Basic Agreement) is
$83,384,000.
(b) The Regular Distribution Dates with respect to any
payment of Scheduled Payments means January 20 and July 20 of each
year, commencing on January 20, 2000, until payment of all of the
Scheduled Payments to be made under the Equipment Notes has been
made.
(c) The Special Distribution Dates with respect to the
Applicable Certificates means any Business Day on which a Special
Payment is to be distributed pursuant to the Agreement.
(d) At the Escrow Agent's request under the Escrow
Agreement, the Trustee shall affix the corresponding Escrow Receipt
to each Applicable Certificate. In any event, any transfer or
exchange of any Applicable Certificate shall also effect a transfer
or exchange of the related Escrow Receipt. Prior to the Final
Withdrawal Date, no transfer or exchange of any Applicable
Certificate shall be permitted unless the corresponding Escrow
Receipt is attached thereto and also is so transferred or
exchanged. By acceptance of any Applicable Certificate to which an
Escrow Receipt is attached, each Holder of such an Applicable
Certificate acknowledges and accepts the restrictions on transfer
of the Escrow Receipt set forth herein and in the Escrow Agreement.
(e) (i) The Applicable Certificates shall be in the form
attached hereto as Exhibit A. Any Person acquiring or accepting an
Applicable Certificate or an interest therein will, by such
acquisition or acceptance, be deemed to represent and warrant that
either (i) the assets of an employee benefit plan subject to Title
I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or of a plan subject to Section 4975 of the
Internal Revenue Code of 1986, as amended (the "Code"), have not
been used to purchase Applicable Certificates or an interest
therein or (ii) the purchase and holding of Applicable Certificates
is exempt from the prohibited transaction restrictions of ERISA and
the Code pursuant to one or more prohibited transaction statutory
or administrative exemptions.
(ii) The Applicable Certificates shall be Book-Entry
Certificates and shall be subject to the conditions set forth in
the Letter of Representations between the Company and the Clearing
Agency attached hereto as Exhibit B.
(f) The Applicable Certificates are subject to the
Intercreditor Agreement, the Deposit Agreement and the Escrow
Agreement.
(g) The Applicable Certificates will have the benefit of the
Liquidity Facility.
(h) The Responsible Party is the Company.
(i) The particular "sections of the Note Purchase
Agreement", for purposes of clause (3) of Section 7.07 of the Basic
Agreement, are Section 6(b) (with respect to Owned Aircraft) and
Section 6(c) (with respect to Leased Aircraft) of the relevant
Participation Agreement attached as an exhibit to the Note Purchase
Agreement.
ARTICLE II
DEFINITIONS
Section 2.01. Definitions. For all purposes of the Basic
Agreement as supplemented by this Trust Supplement, the following
capitalized terms have the following meanings:
Agreement: Has the meaning specified in the recitals hereto.
Aircraft: Means each of the New Aircraft or Substitute
Aircraft in respect of which a Participation Agreement is entered
into in accordance with the Note Purchase Agreement.
Aircraft Purchase Agreement: Has the meaning specified in
the Note Purchase Agreement.
Applicable Certificateholder: Means the Person in whose name
an Applicable Certificate is registered on the Register for the
Applicable Certificates.
Applicable Delivery Date: Has the meaning specified in
Section 5.01(b) of this Trust Supplement.
Applicable Participation Agreement: Has the meaning
specified in Section 5.01(b) of this Trust Supplement.
AVSA: Means AVSA, S.A.R.L.
Business Day: Means any day other than a Saturday, a Sunday
or a day on which commercial banks are required or authorized to
close in New York, New York, Salt Lake City, Utah, Pittsburgh,
Pennsylvania, or, so long as any Applicable Certificate is
outstanding, the city and state in which the Trustee or any Loan
Trustee maintains its Corporate Trust Office or receives and
disburses funds.
Cut-off Date: Means the earlier of (a) the Delivery Period
Termination Date and (b) the date on which a Triggering Event
occurs.
Delivery Date: Has the meaning specified in the
Participation Agreements.
Delivery Notice: Has the meaning specified in the
Participation Agreements.
Delivery Period Termination Date: Means the earlier of (a)
July 20, 2000 and (b) the date on which Equipment Notes issued with
respect to all of the New Aircraft (or Substitute Aircraft in lieu
thereof) have been purchased by the Applicable Trust and the Other
Trusts in accordance with the Note Purchase Agreement.
Deposits: Has the meaning specified in the Deposit Agreement.
Deposit Agreement: Means the Deposit Agreement dated August
31, 1999 relating to the Applicable Certificates between the
Depositary and the Escrow Agent, as the same may be amended,
supplemented or otherwise modified from time to time in accordance
with its terms.
Depositary: Means ABN AMRO Bank, N.V., acting through its
Chicago branch.
Distribution Date: Means any Regular Distribution Date or
Special Distribution Date as the context requires.
Escrow Agent: Means, initially, First Security Bank,
National Association, and any replacement or successor therefor
appointed in accordance with the Escrow Agreement.
Escrow Agreement: Means the Escrow and Paying Agent
Agreement dated August 31, 1999 relating to the Applicable
Certificates, among the Escrow Agent, the Escrow Paying Agent, the
Trustee and Underwriters, as the same may be amended, supplemented
or otherwise modified from time to time in accordance with its
terms.
Escrow Paying Agent: Means the Person acting as paying agent
under the Escrow Agreement.
Escrow Receipt: Means the receipt substantially in the form
annexed to the Escrow Agreement representing a fractional undivided
interest in the funds held in escrow thereunder.
Final Withdrawal: Has the meaning specified in the Escrow
Agreement.
Final Withdrawal Date: Has the meaning specified in the
Escrow Agreement.
Final Withdrawal Notice: Has the meaning specified in
Section 5.02 of this Trust Supplement.
Indenture: Means each of the separate trust indentures and
mortgages relating to the Aircraft, each as specified or described
in a Delivery Notice delivered pursuant to the related
Participation Agreement, in each case as the same may be amended,
supplemented or otherwise modified from time to time in accordance
with its terms.
Intercreditor Agreement: Means the Intercreditor Agreement
dated August 31, 1999 among the Trustee, the Other Trustees, the
Liquidity Provider, the liquidity providers relating to the
Certificates issued under (and as defined in) each of the Other
Agreements, and State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent and as trustee
thereunder, as amended, supplemented or otherwise modified from
time to time in accordance with its terms.
Investors: Means the Underwriters together with all
subsequent beneficial owners of the Applicable Certificates.
Lease: Means, with respect to each Leased Aircraft, the
lease between an Owner Trustee, as the lessor, and the Company, as
the lessee, referred to in the related Indenture, as such lease may
be amended, supplemented or otherwise modified in accordance with
its terms.
Leased Aircraft: Has the meaning specified in the third
recital to this Trust Supplement.
Liquidity Facility: Means, initially, the Revolving Credit
Agreement dated August 31, 1999 relating to the Applicable
Certificates, between the Liquidity Provider and State Street Bank
and Trust Company of Connecticut, National Association, as
Subordination Agent, as agent and trustee for the Applicable Trust,
and, from and after the replacement of such agreement pursuant to
the Intercreditor Agreement, the replacement liquidity facility
therefor, in each case as amended, supplemented or otherwise
modified from time to time in accordance with their respective
terms.
Liquidity Provider: Means, initially, AIG Matched Funding
Corp., and any replacements or successors therefor appointed in
accordance with the Intercreditor Agreement.
New Aircraft: Has the meaning specified in the Note Purchase
Agreement.
Note Documents: Means the Note Purchase Agreement, this
Trust Supplement and, with respect to any Equipment Note, means (i)
the Indenture and the Participation Agreement relating to such
Equipment Note, and (ii) in the case of any Equipment Note related
to a Leased Aircraft, the Lease relating to such Leased Aircraft.
Note Purchase Agreement: Means the Note Purchase Agreement
dated August 31, 1999 among the Trustee, the Other Trustees, the
Company, the Escrow Agent, the Escrow Paying Agent and the
Subordination Agent, providing for, among other things, the
purchase of certain Equipment Notes by the Trustee on behalf of the
Trust, as the same may be amended, supplemented or otherwise
modified from time to time, in accordance with its terms.
Notice of Purchase Withdrawal: Has the meaning specified in
the Deposit Agreement.
Other Agreements: Means (i) the Basic Agreement as
supplemented by Trust Supplement No. 1999-1A dated the date hereof
relating to US Airways Pass Through Trust 1999-1A and (ii) the
Basic Agreement as supplemented by Trust Supplement 1999- 1C dated
the date hereof relating to US Airways Pass Through Trust 1999-1C.
Other Trustees: Means the trustees under the Other
Agreements, and any successor or other trustee appointed as
provided therein.
Other Trusts: Means the US Airways Pass Through Trust
1999-1A and the US Airways Pass Through Trust 1999-1C, each created
on the date hereof.
Owned Aircraft: Has the meaning specified in the third
recital to this Trust Supplement.
Owner Participant: With respect to any Equipment Note
relating to a Leased Aircraft, means the "Owner Participant" as
referred to in the Indenture pursuant to which such Equipment Note
is issued and any permitted successor or assign of such Owner
Participant; and Owner Participants at any time of determination
means all of the Owner Participants thus referred to in the
Indentures.
Owner Trustee: With respect to any Equipment Note relating
to a Leased Aircraft, means the "Owner Trustee", as referred to in
the Indenture pursuant to which such Equipment Note is issued, not
in its individual capacity but solely as trustee; and Owner
Trustees means all of the Owner Trustees party to any of the
Indentures.
Participation Agreement: Means each Participation Agreement
to be entered into by the Trustee pursuant to the Note Purchase
Agreement, as the same may be amended, supplemented or otherwise
modified in accordance with its terms.
Pool Balance: Means, as of any date, (i) the original
aggregate face amount of the Applicable Certificates less (ii) the
aggregate amount of all payments made in respect of such Applicable
Certificates or in respect of Deposits relating to the Applicable
Trust other than payments made in respect of interest or premium
thereon or reimbursement of any costs or expenses incurred in
connection therewith. The Pool Balance as of any Distribution Date
will be computed after giving effect to any special distribution
with respect to unused Deposits, payment of principal of the
Equipment Notes or payment with respect to other Trust Property and
the distribution thereof to be made on that date.
Pool Factor: Means, as of any Distribution Date, the
quotient (rounded to the seventh decimal place) computed by
dividing (i) the Pool Balance by (ii) the original aggregate face
amount of the Applicable Certificates. The Pool Factor as of any
Distribution Date shall be computed after giving effect to any
special distribution with respect to unused Deposits, payment of
principal of the Equipment Notes or other Trust Property and the
distribution thereof to be made on that date.
Prospectus Supplement: Means the Prospectus Supplement dated
August 24, 1999, relating to the offering of the Class A
Certificates and Class B Certificates (as each is defined in the
Intercreditor Agreement)
Special Redemption Premium: Means the premium payable by the
Company in respect of the Final Withdrawal pursuant to the Note
Purchase Agreement.
Special Payment: Means any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note or
Trust Indenture Estate (as defined in each Indenture) or Special
Redemption Premium.
Substitute Aircraft: Has the meaning specified in the Note
Purchase Agreement.
Triggering Event: Has the meaning assigned to such term in
the Intercreditor Agreement.
Trust Property: Means (i) subject to the Intercreditor
Agreement, the Equipment Notes held as the property of the
Applicable Trust, all monies at any time paid thereon and all
monies due and to become due thereunder, (ii) funds from time to
time deposited in the Certificate Account and the Special Payments
Account and, subject to the Intercreditor Agreement, any proceeds
from the sale by the Trustee pursuant to Article VI of the Basic
Agreement of any Equipment Note and (iii) all rights of the
Applicable Trust and the Trustee, on behalf of the Applicable
Trust, under the Intercreditor Agreement, the Escrow Agreement, the
Note Purchase Agreement and the Liquidity Facility, including,
without limitation, all rights to receive certain payments
thereunder, and all monies paid to the Trustee on behalf of the
Applicable Trust pursuant to the Intercreditor Agreement or the
Liquidity Facility, provided that rights with respect to the
Deposits or under the Escrow Agreement, except for the right to
direct withdrawals for the purchase of Equipment Notes to be held
herein, will not constitute Trust Property.
Underwriters: Means, collectively, Credit Suisse First
Boston Corporation, Goldman, Sachs & Co., Donaldson Lufkin &
Jenrette Securities Corporation, Deutsche Bank Securities Inc., and
Salomon Smith Barney Inc..
Underwriting Agreement: Means the Underwriting Agreement
dated August 24, 1999 among the Underwriters and the Company, as
the same may be amended, supplemented or otherwise modified from
time to time in accordance with its terms.
ARTICLE III
DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 3.01. Additions to Article IV of the Basic
Agreement. In addition to the provisions of Article IV of the Basic
Agreement, the following provisions shall apply to the Applicable Trust:
(a) Upon the payment of Special Redemption Premium to the
Trustee under the Note Purchase Agreement, the Trustee, upon
receipt thereof, shall immediately deposit the aggregate amount of
such Special Redemption Premium in the Special Payments Account;
(b) The distribution of amounts of Special Redemption
Premium as provided for in Section 4.02(b) of the Basic Agreement
shall be on the Special Distribution Date with respect to such
Special Payment or as soon thereafter as the Trustee has confirmed
receipt of the related Special Redemption Premium;
(c) In the event of the payment of a Special Redemption
Premium by the Company to the Trustee under the Note Purchase
Agreement, the notice provided for in Section 4.02(c) of the Basic
Agreement shall be mailed, together with the notice by the Escrow
Paying Agent under Section 2.06 of the Escrow Agreement, not less
than 15 days prior to the Special Distribution Date for such
amount, which Special Distribution Date shall be the Final
Withdrawal Date; and
(d) The last sentence of the first paragraph of Section
4.02(c) of the Basic Agreement shall apply equally if the amount of
Special Redemption Premium, if any, has not been calculated at the
time the Trustee mails notice of a Special Payment.
Section 3.02. Statements to Applicable Certificateholders.
(a) On each Distribution Date, the Trustee will include with each
distribution to Applicable Certificateholders of a Scheduled Payment or
Special Payment, as the case may be, a statement setting forth the
information provided below (in the case of a Special Payment, including any
Special Redemption Premium, reflecting in part the information provided by
the Escrow Paying Agent under the Escrow Agreement). Such statement shall
set forth (per $1,000 face amount Applicable Certificate as to (ii), (iii),
(iv) and (v) below) the following information:
(i) the aggregate amount of funds distributed on such
Distribution Date under the Agreement and under the Escrow
Agreement, indicating the amount allocable to each source;
(ii) the amount of such distribution under the Agreement
allocable to principal and the amount allocable to premium
(including the Special Redemption Premium), if any;
(iii) the amount of such distribution under the Agreement
allocable to interest;
(iv) the amount of such distribution under the Escrow
Agreement allocable to interest;
(v) the amount of such distribution under the Escrow
Agreement allocable to Deposits; and
(vi) the Pool Balance and the Pool Factor.
With respect to the Applicable Certificates registered in
the name of a Clearing Agency, on the Record Date prior to each
Distribution Date, the Trustee will request from such Clearing Agency a
securities position listing setting forth the names of all Clearing Agency
Participants reflected on such Clearing Agency's books as holding interests
in the Applicable Certificates on such Record Date. On each Distribution
Date, the Trustee will mail to each such Clearing Agency Participant the
statement described above and will make available additional copies as
requested by such Clearing Agency Participant for forwarding to holders of
interests in the Applicable Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the
Trustee shall furnish to each Person who at any time during such calendar
year was an Applicable Certificateholder of record a statement containing
the sum of the amounts determined pursuant to clauses (a)(i), (a)(ii),
(a)(iii), (a)(iv) and (a)(v) above for such calendar year or, in the event
such Person was an Applicable Certificateholder of record during a portion
of such calendar year, for such portion of such year, and such other items
as are readily available to the Trustee and which an Applicable
Certificateholder shall reasonably request as necessary for the purpose of
such Applicable Certificateholder's preparation of its federal income tax
returns. Such statement and such other items shall be prepared on the basis
of information supplied to the Trustee by the Clearing Agency Participants
and shall be delivered by the Trustee to such Clearing Agency Participants
to be available for forwarding by such Clearing Agency Participants to the
holders of interests in the Applicable Certificates in the manner described
in Section 3.02(a) of this Trust Supplement.
(c) Promptly following (i) the Delivery Period Termination
Date, if there has been any change in the information set forth in clauses
(x), (y) and (z) below from that set forth in page S-42 of the Prospectus
Supplement, and (ii) any early redemption or purchase of, or any default in
the payment of principal or interest in respect of, any of the Equipment
Notes held in the Applicable Trust, or any Final Withdrawal, the Trustee
shall furnish to Applicable Certificateholders of record on such date a
statement setting forth (x) the expected Pool Balances for each subsequent
Regular Distribution Date following the Delivery Period Termination Date,
(y) the related Pool Factors for such Regular Distribution Dates and (z)
the expected principal distribution schedule of the Equipment Notes, in the
aggregate, held as Trust Property at the date of such notice. With respect
to the Applicable Certificates registered in the name of a Clearing Agency,
on the Delivery Period Termination Date, the Trustee will request from such
Clearing Agency a securities position listing setting forth the names of
all Clearing Agency Participants reflected on such Clearing Agency's books
as holding interests in the Applicable Certificates on such date. The
Trustee will mail to each such Clearing Agency Participant the statement
described above and will make available additional copies as requested by
such Clearing Agency Participant for forwarding to holders of interests in
the Applicable Certificates.
(d) This Section 3.02 supersedes and replaces Section 4.03
of the Basic Agreement.
ARTICLE IV
DEFAULT
Section 4.01. Purchase Rights of Certificateholders. (a) At
any time after the occurrence and during the continuance of a Triggering
Event, each Applicable Certificateholder shall have the right to purchase,
for the purchase price set forth in Section 6.01(b) of the Basic Agreement,
all, but not less than all, of the Class A Certificates upon ten days'
written notice to the Class A Trustee and each other Applicable
Certificateholder, provided that (i) if prior to the end of such ten-day
period any other Applicable Certificateholder notifies such purchasing
Applicable Certificateholder that such other Applicable Certificateholder
wants to participate in such purchase, then such other Applicable
Certificateholder may join with the purchasing Applicable Certificateholder
to purchase all, but not less than all, of the Class A Certificates pro
rata based on the Fractional Undivided Interest in the Applicable Trust
held by each such Applicable Certificateholder and (ii) if prior to the end
of such ten-day period any other Applicable Certificateholder fails to
notify the purchasing Applicable Certificateholder of such other Applicable
Certificateholder's desire to participate in such a purchase, then such
other Applicable Certificateholder shall lose its right to purchase the
Class A Certificates pursuant to this Section 4.01(a).
(b) By acceptance of its Applicable Certificate, each
Applicable Certificateholder agrees that at any time after the occurrence
and during the continuation of a Triggering Event, each Class C
Certificateholder shall have the right (which shall not expire upon any
purchase of the Class A Certificates pursuant to clause (a) above) to
purchase all, but not less than all, of the Applicable Certificates and the
Class A Certificates upon ten days' written notice to the Trustee, the
Class A Trustee and each other Class C Certificateholder, provided that (A)
if prior to the end of such ten-day period any other Class C
Certificateholder notifies such purchasing Class C Certificateholder that
such other Class C Certificateholder wants to participate in such purchase,
then such other Class C Certificateholder may join with the purchasing
Class C Certificateholder to purchase all, but not less than all, of the
Applicable Certificates and the Class A Certificates pro rata based on the
Fractional Undivided Interest in the Class C Trust held by each such Class
C Certificateholder and (B) if prior to the end of such ten-day period any
other Class C Certificateholder fails to notify the purchasing Class C
Certificateholder of such other Class C Certificateholder's desire to
participate in such a purchase, then such other Class C Certificateholder
shall lose its right to purchase the Applicable Certificates pursuant to
this Section 4.01(b).
The purchase price with respect to the Applicable
Certificates shall be equal to the Pool Balance of the Applicable
Certificates, together with accrued and unpaid interest thereon to the date
of such purchase, without premium, but including any other amounts then due
and payable to the Applicable Certificateholders under this Agreement, the
Intercreditor Agreement, the Escrow Agreement or any Note Document or on or
in respect of the Applicable Certificates; provided, however, that (i) if
such purchase occurs after the record date specified in Section 2.03(b) of
the Escrow Agreement relating to the distribution of unused Deposits and
accrued and unpaid interest thereunder, such purchase price shall be
reduced by the aggregate amount of unused Deposits and interest to be
distributed under the Escrow Agreement (which deducted amounts shall remain
distributable to, and may be retained by, the Applicable Certificateholder
as of such Record Date) and (ii) if such purchase occurs after a Record
Date, such purchase price shall be reduced by the amount to be distributed
hereunder on the related Distribution Date (which deducted amounts shall
remain distributable to, and may be retained by, the Applicable
Certificateholder as of such Record Date); provided further that no such
purchase of Applicable Certificates shall be effective unless the
purchaser(s) shall certify to the Trustee that contemporaneously with such
purchase, such purchaser(s) is purchasing, pursuant to the terms of this
Agreement and the Other Agreements, the Applicable Certificates and the
Class A Certificates which are senior to the securities held by such
purchaser(s). Each payment of the purchase price of the Applicable
Certificates referred to in the first sentence hereof shall be made to an
account or accounts designated by the Trustee and each such purchase shall
be subject to the terms of this Section 4.01(b). Each Applicable
Certificateholder agrees by its acceptance of its Applicable Certificate
that it will, subject to Section 3.04 of the Basic Agreement, upon payment
from such Class C Certificateholder(s), of the purchase price set forth in
the first sentence of this paragraph, forthwith sell, assign, transfer and
convey to the purchaser(s) thereof (without recourse, representation or
warranty of any kind except for its own acts), all of the right, title,
interest and obligation of such Applicable Certificateholder in this
Agreement, the Escrow Agreement, the Deposit Agreement, the Intercreditor
Agreement, the Liquidity Facility, the Note Documents and all Applicable
Certificates and Escrow Receipts held by such Applicable Certificateholder
(excluding all right, title and interest under any of the foregoing to the
extent such right, title or interest is with respect to an obligation not
then due and payable as respects any action or inaction or state of affairs
occurring prior to such sale) and the purchaser shall assume all of such
Applicable Certificateholder's obligations under this Agreement, the Escrow
Agreement, the Deposit Agreement, the Intercreditor Agreement, the
Liquidity Facility, the Note Documents and all such Applicable Certificates
and Escrow Receipts. The Applicable Certificates will be deemed to be
purchased on the date payment of the purchase price is made notwithstanding
the failure of the Applicable Certificateholders to deliver any Applicable
Certificates and, upon such a purchase, (i) the only rights of the
Applicable Certificateholders will be to deliver the Applicable
Certificates to the purchaser(s) and receive the purchase price for such
Applicable Certificates and (ii) if the purchaser(s) shall so request, such
Applicable Certificateholder will comply with all the provisions of Section
3.04 of the Basic Agreement to enable new Applicable Certificates to be
issued to the purchaser in such denominations as it shall request. All
charges and expenses in connection with the issuance of any such new
Applicable Certificates shall be borne by the purchaser thereof.
As used in this Section 4.01(a), the terms "Class A
Certificateholder", "Class A Trust", "Class A Certificate", "Class A
Trustee", "Class C Certificateholder", "Class C Trust", "Class C
Certificate" and "Class C Trustee" shall have the respective meanings
assigned to such terms in the Intercreditor Agreement.
(b) This Section 4.01 supersedes and replaces Section
6.01(b) of the Basic Agreement.
ARTICLE V
THE TRUSTEE
Section 5.01. Delivery of Documents; Delivery Dates. (a) The
Trustee is hereby directed (i) to execute and deliver the Intercreditor
Agreement, the Escrow Agreement and the Note Purchase Agreement, each in
the form delivered to the Trustee by the Company and (ii) subject to the
respective terms thereof, to perform its obligations thereunder. Upon
request of the Company and the satisfaction or waiver of the closing
conditions specified in the Underwriting Agreement, the Trustee shall
execute, deliver, authenticate, issue and sell Applicable Certificates in
authorized denominations equaling in the aggregate the amount set forth,
with respect to the Applicable Trust, in Schedule I to the Underwriting
Agreement evidencing the entire ownership interest in the Applicable Trust,
which amount equals the maximum aggregate principal amount of Equipment
Notes which may be purchased by the Trustee pursuant to the Note Purchase
Agreement. Except as provided in Sections 3.03, 3.04, 3.05 and 3.06 of the
Basic Agreement, the Trustee shall not execute, authenticate or deliver
Applicable Certificates in excess of the aggregate amount specified in this
paragraph.
(b) On or after the Issuance Date the Company may deliver
from time to time to the Trustee a Delivery Notice relating to one or more
Equipment Notes. After receipt of a Delivery Notice and in any case no
later than one Business Day prior to a Delivery Date as to which such
Delivery Notice relates (the "Applicable Delivery Date"), the Trustee shall
(as and when specified in the Delivery Notice) instruct the Escrow Agent to
provide a Notice of Purchase Withdrawal to the Depositary requesting (A)
the withdrawal of one or more Deposits on the Applicable Delivery Date in
accordance with and to the extent permitted by the terms of the Escrow
Agreement and the Deposit Agreement and (B) the payment of all, or a
portion, of such Deposit or Deposits in an amount equal in the aggregate to
the purchase price of such Equipment Notes to or on behalf of the Owner
Trustee or the Company, as the case may be, issuing such Equipment Notes,
all as shall be described in the Delivery Notice. The Trustee shall (as and
when specified in such Delivery Notice), subject to the conditions set
forth in Section 3 of the Note Purchase Agreement, enter into and perform
its obligations under the Participation Agreement specified in such
Delivery Notice (the "Applicable Participation Agreement") and cause such
certificates, documents and legal opinions relating to the Trustee to be
duly delivered as required by the Applicable Participation Agreement. If at
any time prior to the Applicable Delivery Date, the Trustee receives a
notice of postponement pursuant to Section 2(e), 2(f), or 2(g) of the Note
Purchase Agreement, then the Trustee shall give the Depositary (with a copy
to the Escrow Agent) a notice of cancellation of such Notice of Purchase
Withdrawal relating to such Deposit or Deposits on such Applicable Delivery
Date. Upon satisfaction of the conditions specified in the Note Purchase
Agreement and the Applicable Participation Agreement, the Trustee shall
purchase the applicable Equipment Notes with the proceeds of the
withdrawals of one or more Deposits made on the Applicable Delivery Date in
accordance with the terms of the Deposit Agreement and the Escrow
Agreement. The purchase price of such Equipment Notes shall equal the
principal amount of such Equipment Notes. Amounts withdrawn from such
Deposit or Deposits in excess of the purchase price of the Equipment Notes
or to the extent not applied on the Applicable Delivery Date to the
purchase price of the Equipment Notes, shall be re-deposited by the Trustee
with the Depositary on the Applicable Delivery Date in accordance with the
terms of the Deposit Agreement. The provisions of this Section 5.01(b) and
Section 5.01(c) hereof supersede and replace the provisions of Section 2.02
of the Basic Agreement (which are inapplicable to the Trust), and all
provisions of the Basic Agreement relating to Section 2.02 of the Basic
Agreement shall not apply to the Applicable Trust.
Section 5.02. Withdrawal of Deposits. If any Deposits remain
outstanding on the Business Day next succeeding the Cut-off Date, (i) the
Trustee shall give the Escrow Agent notice that the Trustee's obligation to
purchase Equipment Notes under the Note Purchase Agreement has terminated
and instruct the Escrow Agent to provide a notice of Final Withdrawal to
the Depositary substantially in the form of Exhibit B to the Deposit
Agreement (the "Final Withdrawal Notice") and (ii) the Trustee will make a
demand upon the Company under the Note Purchase Agreement for an amount
equal to the Special Redemption Premium, such payment to be made on the
Final Withdrawal Date.
Section 5.03. The Trustee. (a) Subject to Section 5.04 of
this Trust Supplement and Section 7.15 of the Basic Agreement, the Trustee
shall not be responsible in any manner whatsoever for or in respect of the
validity or sufficiency of this Trust Supplement, the Deposit Agreement or
the Escrow Agreement or the due execution hereof or thereof by the Company
or the other parties thereto (other than the Trustee), or for or in respect
of the recitals and statements contained herein or therein, all of which
recitals and statements are made solely by the Company.
(b) Except as herein otherwise provided, no duties,
responsibilities or liabilities are assumed, or shall be construed to be
assumed by the Trustee by reason of this Trust Supplement other than as set
forth in the Basic Agreement, and this Trust Supplement is executed and
accepted on behalf of the Trustee, subject to all the terms and conditions
set forth in the Basic Agreement, upon the effectiveness thereof, as fully
to all intents as if the same were herein set forth at length.
Section 5.04. Representations and Warranties of the Trustee.
The Trustee hereby represents and warrants that:
(a) the Trustee has full power, authority and legal right to
execute, deliver and perform this Trust Supplement, the
Intercreditor Agreement, the Escrow Agreement and the Note
Documents to which it is a party and has taken all necessary action
to authorize the execution, delivery and performance by it of this
Trust Supplement, the Intercreditor Agreement, the Escrow Agreement
and the Note Documents to which it is a party;
(b) the execution, delivery and performance by the Trustee
of this Trust Supplement, the Intercreditor Agreement, the Escrow
Agreement and the Note Documents to which it is a party (i) will
not violate any provision of any United States federal law or the
law of the state of the United States where it is located governing
the banking and trust powers of the Trustee or any order, writ,
judgment, or decree of any court, arbitrator or governmental
authority applicable to the Trustee or any of its assets, (ii) will
not violate any provision of the articles of association or by-laws
of the Trustee, and (iii) will not violate any provision of, or
constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of any lien on any
properties included in the Trust Property pursuant to the
provisions of any mortgage, indenture, contract, agreement or other
undertaking to which it is a party, which violation, default or
lien could reasonably be expected to have an adverse effect on the
Trustee's performance or ability to perform its duties hereunder or
thereunder or on the transactions contemplated herein or therein;
(c) the execution, delivery and performance by the Trustee
of this Trust Supplement, the Intercreditor Agreement, the Escrow
Agreement and the Note Documents to which it is a party will not
require the authorization, consent, or approval of, the giving of
notice to, the filing or registration with, or the taking of any
other action in respect of, any governmental authority or agency of
the United States or the state of the United States where it is
located regulating the banking and corporate trust activities of
the Trustee; and
(d) this Trust Supplement, the Intercreditor Agreement, the
Escrow Agreement and the Note Documents to which it is a party have
been, or will be, as applicable, duly executed and delivered by the
Trustee and constitute, or will constitute, as applicable, the
legal, valid and binding agreements of the Trustee, enforceable
against it in accordance with their respective terms; provided,
however, that enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and (ii) general
principles of equity.
Section 5.05. Trustee Liens. The Trustee in its individual
capacity agrees, in addition to the agreements contained in Section 7.17 of
the Basic Agreement, that it will at its own cost and expense promptly take
any action as may be necessary to duly discharge and satisfy in full any
Trustee's Liens on or with respect to the Trust Property which is
attributable to the Trustee in its individual capacity and which is
unrelated to the transactions contemplated by the Intercreditor Agreement
or the Note Purchase Agreement.
ARTICLE VI
SUPPLEMENTAL AGREEMENTS
Section 6.01. Supplemental Agreements Without Consent of
Applicable Certificateholders. Under the terms of, and subject to the
limitations contained in, Section 9.01 of the Basic Agreement, the Company
may (but will not be required to), and the Trustee (subject to Section 9.03
of the Basic Agreement) shall, at the Company's request, at any time and
from time to time, enter into one or more agreements supplemental to the
Escrow Agreement, the Note Purchase Agreement or the Deposit Agreement, for
any of the purposes set forth in clauses (1) through (9) of such Section
9.01, except that (a) clause (3) of such Section 9.01 shall be deemed to
include the Company's rights and powers conferred by the Note Purchase
Agreement and (b) clause (4) of such Section 9.01 shall be deemed to
include corrections or supplements to provisions of the Escrow Agreement or
the Deposit Agreement which may be defective or inconsistent with any other
provision of this Agreement or contained in any agreement referred to in
such clause (4) and the curing of any ambiguity or the modification of any
other provision with respect to matters or questions arising under the
Escrow Agreement or the Deposit Agreement.
Section 6.02. Supplemental Agreements with Consent of
Applicable Certificateholders. The provisions of Section 9.02 of the Basic
Agreement shall apply to agreements or amendments for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of the Escrow Agreement, the Deposit Agreement or the Note
Purchase Agreement to the extent applicable to the Applicable
Certificateholders approving such agreement or amendment or modifying in
any manner the rights and obligations of such Applicable Certificateholders
under the Escrow Agreement, the Deposit Agreement or the Note Purchase
Agreement; provided that the provisions of Section 9.02(1) of the Basic
Agreement shall be deemed to include reductions in any manner of, or delay
in the timing of, any receipt by the Applicable Certificateholders of
payments upon the Deposits; provided, further, that the provisions of
Section 9.02(6) of the Basic Agreement shall not apply to the Applicable
Trust and any supplemental agreement having the effect described in said
Section 9.02(6) shall require only the consent of Applicable
Certificateholders holding Applicable Certificates evidencing a Fractional
Undivided Interest aggregating not less than a majority in interest in the
Applicable Trust.
ARTICLE VII
TERMINATION OF TRUST
Section 7.01. Termination of the Trust. The respective
obligations and responsibilities of the Company and the Trustee with
respect to the Applicable Trust shall terminate upon the distribution to
all Applicable Certificateholders and the Trustee of all amounts required
to be distributed to them pursuant to this Agreement and the disposition of
all property held as part of the Trust Property; provided, however, that in
no event shall the Applicable Trust continue beyond 21 years less one day
following the death of the last survivor of all descendants living on the
date hereof of Joseph P. Kennedy, Sr., unless applicable law shall permit a
longer term, in which case such longer term shall apply.
Notice of any termination, specifying the Distribution Date
upon which the Applicable Certificateholders may surrender their Applicable
Certificates to the Trustee for payment of the final distribution and
cancellation, shall be mailed promptly by the Trustee to Applicable
Certificateholders not earlier than the 60th day and not later than the
15th day next preceding such final Distribution Date specifying (A) the
Distribution Date upon which the proposed final payment of the Applicable
Certificates will be made upon presentation and surrender of Applicable
Certificates at the office or agency of the Trustee therein specified, (B)
the amount of any such proposed final payment, and (c) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Applicable
Certificates at the office or agency of the Trustee therein specified. The
Trustee shall give such notice to the Registrar at the time such notice is
given to Applicable Certificateholders. Upon presentation and surrender of
the Applicable Certificates in accordance with such notice, the Trustee
shall cause to be distributed to Applicable Certificateholders such final
payments.
In the event that all of the Applicable Certificateholders
shall not surrender their Applicable Certificates for cancellation within
six months after the date specified in the above-mentioned written notice,
the Trustee shall give a second written notice to the remaining Applicable
Certificateholders to surrender their Applicable Certificates for
cancellation and receive the final distribution with respect thereto. No
additional interest shall accrue on the Applicable Certificates after the
Distribution Date specified in the first written notice. In the event that
any money held by the Trustee for the payment of distributions on the
Applicable Certificates shall remain unclaimed for two years (or such
lesser time as the Trustee shall be satisfied, after sixty days' notice
from the Company, is one month prior to the escheat period provided under
applicable law) after the final distribution date with respect thereto, the
Trustee shall pay to each Loan Trustee the appropriate amount of money
relating to such Loan Trustee and shall give written notice thereof to the
related Owner Trustees, the Owner Participants and the Company.
ARTICLE VIII
THE COMPANY
Section 8.01. Consolidation, Mergers, Etc. Section 5.02 of
the Basic Agreement is hereby amended with respect to the Applicable Trust
by deleting the word "and" at the end of clause (b) thereof, renumbering
clause (c) as clause "(d)" and inserting a new clause (c) as follows:
"(c) immediately after giving effect to such transaction, no
Indenture Event of Default (in the case of an Owned Aircraft) or,
in the case of a Leased Aircraft, Lease Event of Default (as
defined in the related Indenture) shall have occurred and be
continuing; and"
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Basic Agreement Ratified. Except and so far as
herein expressly provided, all of the provisions, terms and conditions of
the Basic Agreement are in all respects ratified and confirmed; and the
Basic Agreement and this Trust Supplement shall be taken, read and
construed as one and the same instrument.
Section 9.02. GOVERNING LAW. THIS AGREEMENT AND THE
APPLICABLE CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 9.03. Execution in Counterparts. This Trust
Supplement may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute but
one and the same instrument.
Section 9.04. Intention of Parties. The parties hereto
intend that the Applicable Trust be classified for U.S. federal income tax
purposes as a grantor trust under Subpart E, Part I of Subchapter J of the
Internal Revenue Code of 1986, as amended, and not as a trust or
association taxable as a corporation or as a partnership. Each Applicable
Certificateholder and Investor, by its acceptance of its Applicable
Certificate or a beneficial interest therein, agrees to treat the
Applicable Trust as a grantor trust for all U.S. federal, state and local
income tax purposes. The powers granted and obligations undertaken pursuant
to the Agreement shall be so construed so as to further such intent.
IN WITNESS WHEREOF, the Company and the Trustee have caused
this Trust Supplement to be duly executed by their respective officers
thereto duly authorized, as of the day and year first written above.
US AIRWAYS, INC.
By:/s/ Jeffery A. McDougle
_____________________________
Name: Jeffery A. McDougle
Title: Vice President and
Treasurer
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as
Trustee
By:/s/ John G. Correia
_____________________________
Name: John G. Correia
Title:Assistant Secretary
EXHIBIT A
FORM OF CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.*
US AIRWAYS ____________ PASS THROUGH TRUST
*This legend to appear on Book-Entry Certificates to be deposited with The
Depository Trust Company.
Pass Through Certificate, Series __________
Final Expected Regular Distribution Date: _____,
____ evidencing a fractional undivided interest in
a trust, the property of which includes certain
equipment notes each secured by Aircraft owned by
or leased to US Airways, Inc.
Certificate
No.______ $__________ Fractional Undivided Interest representing
._____% of the Trust per $1,000 face amount
THIS CERTIFIES THAT __________________, for value received,
is the registered owner of a $___________ (________ dollars)
Fractional Undivided Interest in the US Airways Pass Through Trust,
Series [___] (the "Trust") created by State Street Bank and Trust
Company of Connecticut, National Association, as trustee (the
"Trustee"), pursuant to a Pass Through Trust Agreement dated as of
__________, 1999 (the "Basic Agreement"), between the Trustee, US
Airways, Inc., a corporation incorporated under Delaware law (the
"Company") and US Airways Group, Inc., a corporation incorporated
under Delaware law (the "Parent"), as supplemented by Trust
Supplement No. _______ thereto dated __________, ____, between the
Trustee and the Company (collectively, the "Agreement"), a summary
of certain of the pertinent provisions of which is set forth below.
To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in the Agreement.
This Certificate is one of the duly authorized Certificates
designated as "___% US Airways Pass Through Certificate, Series
____" (herein called the "Certificates"). This Certificate is
issued under and is subject to the terms, provisions and conditions
of the Agreement. By virtue of its acceptance hereof, the
Certificateholder of this Certificate assents to and agrees to be
bound by the provisions of the Agreement and any related
Intercreditor Agreement. The property of the Trust includes certain
Equipment Notes and all rights of the Trust to receive any payments
under any Intercreditor Agreement or Liquidity Facility (the "Trust
Property"). Each issue of the Equipment Notes is or will be secured
by, among other things, a security interest in aircraft leased to
or owned by the Company.
The Certificates represent Fractional Undivided Interests in
the Trust and the Trust Property, and have no rights, benefits or
interest in respect of any other separate trust established
pursuant to the terms of the Basic Agreement for any other series
of certificates issued pursuant thereto.
Subject to and in accordance with the terms of the Agreement
and any related Intercreditor Agreement, from funds then available
to the Trustee, there will be distributed on each __________ and
___________ (a "Regular Distribution Date"), commencing on
_________, ____, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the
Regular Distribution Date, an amount in respect of the Scheduled
Payments on the Equipment Notes due on such Regular Distribution
Date, the receipt of which has been confirmed by the Trustee, equal
to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Scheduled
Payments. Subject to and in accordance with the terms of the
Agreement and any related Intercreditor Agreement, in the event
that Special Payments on the Equipment Notes are received by the
Trustee, from funds then available to the Trustee, there shall be
distributed on the applicable Special Distribution Date, to the
Person in whose name this Certificate is registered at the close of
business on the 15th day preceding the Special Distribution Date,
an amount in respect of such Special Payments on the Equipment
Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust
evidenced by this Certificate and an amount equal to the sum of
such Special Payments so received. If a Regular Distribution Date
or Special Distribution Date is not a Business Day, distribution
shall be made on the immediately following Business Day with the
same force and effect as if made on such Regular Distribution Date
or Special Distribution Date and no interest shall accrue during
the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the
Trustee by check mailed to the Person entitled thereto, without the
presentation or surrender of this Certificate or the making of any
notation hereon, except that with respect to Certificates
registered on the Record Date in the name of a Clearing Agency (or
its nominee), such distribution shall be made by wire transfer.
Except as otherwise provided in the Agreement and notwithstanding
the above, the final distribution on this Certificate will be made
after notice mailed by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this
Certificate at the office or agency of the Trustee specified in
such notice.
The Certificates do not represent a direct obligation of, or
an obligation guaranteed by, or an interest in, the Company or the
Trustee or any affiliate thereof. The Certificates are limited in
right of payment, all as more specifically set forth on the face
hereof and in the Agreement. All payments or distributions made to
Certificateholders under the Agreement shall be made only from the
Trust Property and only to the extent that the Trustee shall have
sufficient income or proceeds from the Trust Property to make such
payments in accordance with the terms of the Agreement. Each
Certificateholder of this Certificate, by its acceptance hereof,
agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate
does not purport to summarize the Agreement and reference is made
to the Agreement for information with respect to the interests,
rights, benefits, obligations, proceeds, and duties evidenced
hereby. A copy of the Agreement may be examined during normal
business hours at the principal office of the Trustee, and at such
other places, if any, designated by the Trustee, by any
Certificateholder upon request.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the
Certificateholders under the Agreement at any time by the Company
and the Trustee with the consent of the Certificateholders holding
Certificates evidencing Fractional Undivided Interests aggregating
not less than a majority in interest in the Trust. Any such consent
by the Certificateholder of this Certificate shall be conclusive
and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate
issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the
Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations set forth, the transfer of this Certificate is
registrable in the Register upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by
the Trustee in its capacity as Registrar, or by any successor
Registrar duly endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Registrar,
duly executed by the Certificateholder hereof or such
Certificateholder's attorney duly authorized in writing, and
thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate Fractional Undivided Interest in the
Trust will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered
Certificates without coupons in minimum denominations of $1,000
Fractional Undivided Interest and integral multiples thereof except
that one Certificate may be issued in a different denomination. As
provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same
aggregate Fractional Undivided Interest in the Trust, as requested
by the Certificateholder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee shall require payment of a
sum sufficient to cover any tax or governmental charge payable in
connection therewith.
Each Certificateholder and Investor, by its acceptance of
this Certificate or a beneficial interest herein, agrees to treat
the Trust as a grantor trust for all U.S. federal, state and local
income tax purposes.
The Trustee, the Registrar, and any agent of the Trustee or
the Registrar may treat the person in whose name this Certificate
is registered as the owner hereof for all purposes, and neither the
Trustee, the Registrar, nor any such agent shall be affected by any
notice to the contrary.
The obligations and responsibilities created by the
Agreement and the Trust created thereby shall terminate upon the
distribution to Certificateholders of all amounts required to be
distributed to them pursuant to the Agreement and the disposition
of all property held as part of the Trust Property.
Any Person acquiring or accepting this Certificate or an
interest herein will, by such acquisition or acceptance, be deemed
to have represented and warranted that either: (i) the assets of an
employee benefit plan subject to Title I of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or of a plan
subject to Section 4975 of the Internal Revenue Code of 1986, as
amended (the "Code"), have not been used to purchase this
Certificate or an interest herein or (ii) the purchase and holding
of this Certificate or interest herein are exempt from the
prohibited transaction restrictions of ERISA and the Code pursuant
to one or more prohibited transaction statutory or administrative
exemptions.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL
BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been
executed by the Trustee, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be
valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate
to be duly executed.
US AIRWAYS PASS THROUGH TRUST
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as
Trustee
By:_____________________________
Title:__________________________
Dated:__________________________
FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as
Trustee
By:______________________________
Authorized Officer
EXHIBIT B
[DTC Letter of Representations]
Exhibit 4(a)(iv)
DEPOSIT AGREEMENT
(Class A)
Dated as of August 31, 1999
between
FIRST SECURITY BANK, NATIONAL ASSOCIATION
as Escrow Agent
and
ABN AMRO BANK N.V.,
Chicago Branch
as Depositary
TABLE OF CONTENTS
Page
ARTICLE I FORMATION OF DEPOSITS . . . . . . . . . . . . . . . 2
Section 1.1 Acceptance of Depositary . . . . . . . . . . 2
Section 1.2 Establishment of Accounts. . . . . . . . . . 2
ARTICLE II MAINTENANCE OF DEPOSITS . . . . . . . . . . . . . . 2
Section 2.1 Deposits. . . . . . . . . . . . . . . . . . . 2
Section 2.2 Interest. . . . . . . . . . . . . . . . . . . 2
Section 2.3 Withdrawals. . . . . . . . . . . . . . . . . 3
Section 2.4 Other Accounts. . . . . . . . . . . . . . . . 3
ARTICLE III TERMINATION . . . . . . . . . . . . . . . . . . . 4
ARTICLE IV PAYMENTS . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE V REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . 5
ARTICLE VI TRANSFER . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE VII AMENDMENT . . . . . . . . . . . . . . . . . . . . 6
ARTICLE VIII NOTICES . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE IX OBLIGATIONS UNCONDITIONAL . . . . . . . . . . . . . 7
ARTICLE X ENTIRE AGREEMENT . . . . . . . . . . . . . . . . . . 7
ARTICLE XI GOVERNING LAW . . . . . . . . . . . . . . . . . . . 7
ARTICLE XII SUBMISSION TO JURISDICTION;
WAIVER OF JURY TRIAL RIGHT . . . . . . . . . . . . . . . . . 7
ARTICLE XIII COUNTERPARTS . . . . . . . . . . . . . . . . . . 8
ARTICLE XIV HEAD OFFICE OBLIGATION . . . . . . . . . . . . . . 8
Schedule I Schedule of Deposits
Exhibit A Notice of Purchase Withdrawal
Exhibit B Notice of Final Withdrawal
This DEPOSIT AGREEMENT (Class A) dated as of August 31, 1999
(as amended, modified or supplemented from time to time, this "Agreement")
between First Security Bank, National Association, a national banking
association, as Escrow Agent under the Escrow and Paying Agent Agreement
referred to below (in such capacity, together with its successors in such
capacity, the "Escrow Agent"), and ABN AMRO BANK N.V., a banking
institution organized under the laws of The Netherlands, acting through
its Chicago branch, as depositary bank (the "Depositary").
W I T N E S S E T H
WHEREAS, US Airways, Inc. ("US Airways") and State Street Bank
and Trust Company of Connecticut, National Association, not in its
individual capacity except as otherwise expressly provided therein, but
solely as trustee (in such capacity, together with its successors in such
capacity, the "Pass Through Trustee") have entered into a Trust Supplement,
dated August 31, 1999, to the Pass Through Trust Agreement dated as of July
30, 1999 (together, as amended, modified or supplemented from time to time
in accordance with the terms thereof, the "Pass Through Trust Agreement")
relating to US Airways Pass Through Trust 1999-1A pursuant to which the US
Airways Pass Through Trust, Series 1999-1A Certificates referred to therein
(the "Certificates") are being issued;
WHEREAS, US Airways and Credit Suisse First Boston Corporation,
Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities Corporation,
Salomon Smith Barney Inc. and Deutsche Bank Securities Inc. (collectively,
the "Underwriters" and, together with their respective transferees and
assigns as registered owners of the Certificates, the "Investors") have
entered into an Underwriting Agreement dated as of August 24, 1999 pursuant
to which the Pass Through Trustee will issue and sell the Certificates to
the Underwriters;
WHEREAS, US Airways, the Pass Through Trustee, certain other pass
through trustees and certain other persons concurrently herewith are
entering into the Note Purchase Agreement, dated as of the date hereof (the
"Note Purchase Agreement"), pursuant to which the Pass Through Trustee has
agreed to acquire from time to time on or prior to the Delivery Period
Termination Date (as defined in the Note Purchase Agreement) equipment
notes (the "Equipment Notes") issued to finance the acquisition of aircraft
by US Airways, as lessee or as owner, utilizing a portion of the proceeds
from the sale of the Certificates (the "Net Proceeds");
WHEREAS, the Escrow Agent, the Underwriters, the Pass Through
Trustee and State Street Bank and Trust Company of Connecticut, National
Association, as paying agent for the Escrow Agent (in such capacity,
together with its successors in such capacity, the "Paying Agent")
concurrently herewith are entering into an Escrow and Paying Agent
Agreement, dated as of the date hereof (as amended, modified or
supplemented from time to time in accordance with the terms thereof, the
"Escrow and Paying Agent Agreement"); and
WHEREAS, the Underwriters and the Pass Through Trustee intend
that the Net Proceeds be held in escrow by the Escrow Agent on behalf of
the Investors pursuant to the Escrow and Paying Agent Agreement, subject to
withdrawal upon request of and proper certification by the Pass Through
Trustee for the purpose of purchasing Equipment Notes, and that pending
such withdrawal the Net Proceeds be deposited by the Escrow Agent with the
Depositary pursuant to this Agreement, which provides for the Depositary to
pay interest for distribution to the Investors and to establish accounts
from which the Escrow Agent shall make withdrawals upon request of and
proper certification by the Pass Through Trustee.
NOW, THEREFORE, in consideration of the obligations contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby
agree as follows:
ARTICLE I
FORMATION OF DEPOSITS
Section 1.1 Acceptance of Depositary. The Depositary hereby
agrees to act as depositary bank as provided herein and in connection
therewith to accept all amounts to be delivered to or held by the
Depositary pursuant to the terms of this Agreement. The Depositary further
agrees to hold, maintain and safeguard the Deposits and the Accounts (as
defined below) during the term of this Agreement in accordance with the
provisions of this Agreement. The Escrow Agent shall not have any right to
withdraw, assign or otherwise transfer moneys held in the Accounts except
as permitted by this Agreement.
Section 1.2 Establishment of Accounts. The Escrow Agent hereby
instructs the Depositary, and the Depositary agrees, to establish the
separate deposit accounts listed on Schedule I hereto and to establish
such additional separate deposit accounts as may be required in connection
with the deposits contemplated by Section 2.4 hereof (each, an "Account"
and collectively, the "Accounts"), each in the name of the Escrow Agent
and all on the terms and conditions set forth in this Agreement.
ARTICLE II
MAINTENANCE OF DEPOSITS
Section 2.1 Deposits. The Escrow Agent shall direct the
Underwriters to deposit with the Depositary on the date of this Agreement
(the "Deposit Date") in Federal (same day) funds by official check or
checks or wire or other transfer to: Federal Reserve Bank, New York, ABN
NY, Reference: US Airways 1999-1, ABA# 026009580, Account: Chicago
Treasury, Reference: US Airways Deposit and the Depositary shall accept
from the Underwriters, on behalf of the Escrow Agent, the sum of
US$384,884,000. Upon acceptance of such sum, the Depositary shall (i)
establish each of the deposits specified in Schedule I hereto maturing on
the respective dates set forth therein (including any deposit made
pursuant to Section 2.4 hereof, individually, a "Deposit" and,
collectively, the "Deposits") and (ii) credit each Deposit to the related
Account as set forth therein. No amount shall be deposited in any Account
other than the related Deposit.
Section 2.2 Interest. Each Deposit shall bear interest from
and including the date of deposit to but excluding the date of withdrawal
at the rate of 8.36% per annum (computed on the basis of a year of twelve
30-day months) payable to the Paying Agent on behalf of the Escrow Agent
semi-annually in arrears on each January 20 and July 20, commencing on
January 20, 2000 (each, an "Interest Payment Date"), and on the date of
the Final Withdrawal (as defined below), all in accordance with the terms
of this Agreement (whether or not any such Deposit is withdrawn on an
Interest Payment Date). Interest accrued on any Deposit that is withdrawn
pursuant to a Notice of Purchase Withdrawal (as defined below) shall be
paid on the next Interest Payment Date, notwithstanding any intervening
Final Withdrawal (as defined below).
Section 2.3 Withdrawals. (a) On and after the date seven (7)
days after the establishment of any Deposit, the Escrow Agent may, by
providing at least one (1) Business Day's prior notice of withdrawal to
the Depositary in the form of Exhibit A hereto (a "Notice of Purchase
Withdrawal"), withdraw not less than the entire balance of such Deposit,
except that at any time prior to the actual withdrawal of such Deposit,
the Escrow Agent or the Pass Through Trustee may, by notice to the
Depositary, cancel such withdrawal (including on the scheduled date
therefor), and thereafter such Deposit shall continue to be maintained by
the Depositary in accordance with the original terms thereof. Following
such withdrawal the balance in the related Account shall be zero and the
Depositary shall close such Account. As used herein, "Business Day" means
any day, other than a Saturday, Sunday or other day on which commercial
banks are authorized or required by law to close in New York, New York,
Chicago, Illinois, Pittsburgh, Pennsylvania, Hartford, Connecticut or Salt
Lake City, Utah.
(b) The Escrow Agent may, by providing at least fifteen (15)
days' prior notice of withdrawal to the Depositary in the form of Exhibit B
hereto (a "Notice of Final Withdrawal"), withdraw the entire amount of all
of the remaining Deposits together with the payment by the Depositary of
all accrued and unpaid interest on such Deposits to but excluding the
specified date of withdrawal (a "Final Withdrawal"), on such date as shall
be specified in such Notice of Final Withdrawal. If a Notice of Final
Withdrawal has not been given to the Depositary on or before July 21, 2000
and there are unwithdrawn Deposits on such date, the Depositary shall pay
the amount of the Final Withdrawal to the Paying Agent on August 7, 2000.
(c) If the Depositary receives a duly completed Notice of
Purchase Withdrawal or Notice of Final Withdrawal complying with the
provisions of this Agreement, it shall make the payments specified therein
in accordance with the provisions of this Agreement.
Section 2.4 Other Accounts. On the date of withdrawal of any
Deposit, the Escrow Agent, or the Pass Through Trustee on behalf of the
Escrow Agent, shall be entitled to re- deposit with the Depositary any
portion thereof and the Depositary shall accept the same for deposit
hereunder. Any sums so received for deposit shall be established as a new
Deposit and credited to a new Account, all as more fully provided in
Section 2.1 hereof, and thereafter the provisions of this Agreement shall
apply thereto as fully and with the same force and effect as if such
Deposit had been established on the Deposit Date except that (i) such
Deposit may not be withdrawn prior to the date seven days after the
establishment thereof and (ii) such Deposit shall mature on August 7, 2000
and bear interest as provided in Section 2.2. The Depositary shall
promptly give notice to the Escrow Agent of receipt of each such
re-deposit and the account number assigned thereto.
ARTICLE III
TERMINATION
This Agreement shall terminate on the fifth (5th) Business Day
after the later of the date on which (i) all of the Deposits shall have
been withdrawn and paid as provided herein without any re-deposit and (ii)
all accrued and unpaid interest on the Deposits shall have been paid as
provided herein, but in no event prior to the date on which the Depositary
shall have performed in full its obligations hereunder.
ARTICLE IV
PAYMENTS
All payments (including, without limitation, those payments made
in respect of Taxes (as defined and provided for below)) made by the
Depositary hereunder shall be paid in United States Dollars and immediately
available funds by wire transfer (i) in the case of accrued interest on the
Deposits payable under Section 2.2 hereof or any Final Withdrawal, directly
to the Paying Agent at State Street Bank and Trust Company of Connecticut,
National Association, c/o State Street Bank and Trust Company, 2
International Place, 4th Floor, Boston, MA 02110, ABA# 011-0000-28,
Account # 9903-9901, Attention: Sandra Thomson, Reference: US Airways 1999-
1A EETC, or to such other account as the Paying Agent may direct from time
to time in writing to the Depositary and the Escrow Agent and (ii) in the
case of any withdrawal of one or more Deposits pursuant to a Notice of
Purchase Withdrawal, directly to or as directed by the Pass Through Trustee
as specified and in the manner provided in such Notice of Purchase
Withdrawal. The Depositary hereby waives any and all rights of set-off,
combination of accounts, right of retention or similar right (whether
arising under applicable law, contract or otherwise) it may have against
the Deposits howsoever arising. All payments on or in respect of each
Deposit shall be made free and clear of and without reduction for or on
account of any and all taxes, levies or other impositions or charges
(collectively, "Taxes"). However, if the Depositary or the Paying Agent
(pursuant to Section 2.4 of the Escrow and Paying Agent Agreement) shall be
required by law to deduct or withhold any Taxes from or in respect of any
sum payable hereunder, the Depositary shall: (i) make such deductions or
withholding; (ii) pay the full amount deducted or withheld (including in
respect of such additional amounts) to the competent taxation authority;
and (iii) if the Taxes required to be deducted or withheld are imposed by
The Netherlands or any political subdivision thereof, pay such additional
amounts as may be necessary in order that the actual amount received by the
designated recipient of such sum under this Agreement or the Escrow and
Paying Agent Agreement after such deduction or withholding equals the sum
it would have received had no such deduction or withholding been required.
If the date on which any payment due on any Deposit would otherwise fall on
a day which is not a Business Day, such payment shall be made on the next
succeeding Business Day with the same force and effect as if made on such
scheduled date, and no additional interest shall accrue in respect of such
extension.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Depositary hereby represents and warrants to US Airways, the
Escrow Agent, the Pass Through Trustee and the Paying Agent that:
(1) it is a bank duly organized and validly existing in good
standing under the laws of its jurisdiction of organization and is duly
qualified to conduct banking business in the State of Illinois through its
Chicago branch;
(2) it has full power, authority and legal right to conduct its
business and operations as currently conducted and to enter into and
perform its obligations under this Agreement;
(3) the execution, delivery and performance of this Agreement
have been duly authorized by all necessary corporate action on the part of
it and do not require any stockholder approval, or approval or consent of
any trustee or holder of any indebtedness or obligations of it, and such
document has been duly executed and delivered by it and constitutes its
legal, valid and binding obligations enforceable against it in accordance
with the terms hereof;
(4) no authorization, consent or approval of or other action by,
and no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by it of this Agreement;
(5) neither the execution, delivery or performance by it of this
Agreement, nor compliance with the terms and provisions hereof, conflicts
or will conflict with or results or will result in a breach or violation of
any of the terms, conditions or provisions of, or will require any consent
or approval under, any law, governmental rule or regulation or the charter
documents, as amended, or bylaws, as amended, of it or any similar
instrument binding on it or any order, writ, injunction or decree of any
court or governmental authority against it or by which it or any of its
properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which it is a party or by which it or any of its
properties is bound, or constitutes or will constitute a default thereunder
or results or will result in the imposition of any lien upon any of its
properties; and
(6) there are no pending or, to its knowledge, threatened
actions, suits, investigations or proceedings (whether or not purportedly
on behalf of it) against or affecting it or any of its property before or
by any court or administrative agency which, if adversely determined, (i)
would adversely affect the ability of it to perform its obligations under
this Agreement or (ii) would call into question or challenge the validity
of this Agreement or the enforceability hereof in accordance with the terms
hereof, nor is the Depositary in default with respect to any order of any
court, governmental authority, arbitration board or administrative agency
so as to adversely affect its ability to perform its obligations under this
Agreement.
ARTICLE VI
TRANSFER
Neither party hereto shall be entitled to assign or otherwise
transfer this Agreement (or any interest herein) other than (in the case of
the Escrow Agent) to a successor escrow agent under Section 1.7 of the
Escrow and Paying Agent Agreement, and any purported assignment in
violation thereof shall be void. This Agreement shall be binding upon the
parties hereto and their respective successors and (in the case of the
Escrow Agent) permitted assigns.
ARTICLE VII
AMENDMENT
This Agreement may not be amended, waived or otherwise modified
except by an instrument in writing signed by the party against whom the
amendment, waiver or other modification is sought to be enforced and by the
Pass Through Trustee.
ARTICLE VIII
NOTICES
Unless otherwise expressly provided herein, any notice or other
communication under this Agreement shall be in writing (including by
facsimile) and shall be deemed to be given and effective upon receipt
thereof. All notices shall be sent to (x) in the case of the Depositary,
ABN AMRO BANK N.V., 135 South LaSalle Street, Chicago, Illinois 60603,
Attention: Vice President-Aerospace (Telecopier: (312) 606-8428, with a
copy to ABN AMRO BANK N.V., Chicago Branch 181 W. Madison Street, Chicago
Illinois 60602 Attention: Money Market Desk (Telecopier: (312) 904-9107) or
(y) in the case of the Escrow Agent, First Security Bank, National
Association, 79 South Main Street, Salt Lake City, UT 84111, Attention:
Corporate Trust Services (Telecopier: (801) 246-5053), in each case, with a
copy to the Pass Through Trustee, State Street Bank and Trust Company of
Connecticut, National Association, 225 Asylum Street, Goodwyn Square,
Hartford, CT 06103, Attention: Corporate/Muni. Department (Telecopier:
(860) 244-1889) and to US Airways, US Airways, Inc., 2345 Crystal Drive,
Arlington, VA 22227, Attention: Treasurer (Telecopier: (703) 872-5936) (or
at such other address as any such party may specify from time to time in a
written notice to the parties hereto). On or prior to the execution of
this Agreement, the Escrow Agent has delivered to the Depositary a
certificate containing specimen signatures of the representatives of the
Escrow Agent who are authorized to give notices and instructions with
respect to this Agreement. The Depositary may conclusively rely on such
certificate until the Depositary receives written notice from the Escrow
Agent to the contrary.
ARTICLE IX
OBLIGATIONS UNCONDITIONAL
The Depositary hereby acknowledges and agrees that its obligation
to repay each Deposit together with interest thereon as provided herein is
absolute, irrevocable and unconditional and constitutes a full recourse
obligation of the Depositary enforceable against it to the full extent of
all of its assets and properties.
ARTICLE X
ENTIRE AGREEMENT
This Agreement (including all attachments hereto) sets forth all
of the promises, covenants, agreements, conditions and understandings
between the Depositary and the Escrow Agent with respect to the subject
matter hereof and supersedes all prior and contemporaneous agreements and
undertakings, inducements or conditions, express or implied, oral or
written.
ARTICLE XI
GOVERNING LAW
THIS AGREEMENT, AND THE RIGHTS AND OBLIGATIONS OF THE DEPOSITARY
AND THE ESCROW AGENT WITH RESPECT TO THE DEPOSITS, SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK AND
SUBJECT TO THE PROVISIONS OF REGULATION D OF THE BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM (OR ANY SUCCESSOR), AS THE SAME MAY BE MODIFIED AND
SUPPLEMENTED AND IN EFFECT FROM TIME TO TIME.
ARTICLE XII
SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL RIGHT
SECTION 12.1 Submission to Jurisdiction. Each of the Depositary
and the Escrow Agent hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement, or for recognition
and enforcement of any judgment in respect hereof, to the
nonexclusive general jurisdiction of the courts of the State
of New York, the courts of the United States of America for
the Southern District of New York, and the appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts, and waives any objection that it may now or
hereafter have to the venue of any such action or
proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees
not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar
form of mail), postage prepaid, to each party hereto at its
address set forth in Article VIII hereof, or at such other
address of which shall have been notified pursuant thereto;
and
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.
SECTION 12.2 WAIVER OF JURY TRIAL RIGHT. EACH OF THE DEPOSITARY
AND THE ESCROW AGENT ACKNOWLEDGES AND ACCEPTS THAT IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT SUCH PARTY
IRREVOCABLY WAIVES ITS RIGHT TO A TRIAL BY JURY.
ARTICLE XIII
COUNTERPARTS
This Agreement may be executed in one or more counterparts, all
of which taken together shall constitute one instrument.
ARTICLE XIV
HEAD OFFICE OBLIGATION
ABN AMRO Bank N.V. hereby agrees that the obligations of the
Depositary hereunder are also the obligations of ABN AMRO Bank N.V.'s Head
Office in The Netherlands. Accordingly, any beneficiary of this Agreement
will be able to proceed directly against ABN AMRO Bank N.V.'s Head Office
in The Netherlands if ABN AMRO Bank N.V.'s Chicago branch defaults in its
obligation to such beneficiary under this Agreement.
IN WITNESS WHEREOF, the Escrow Agent and the Depositary have caused this
Deposit Agreement to be duly executed as of the day and year first above
written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, as Escrow Agent
By /s/ Brett R.King
----------------------------
Name: Brett R. King
Title: Vice President
ABN AMRO Bank, N.V.,
Chicago Branch, as Depositary
By /s/ Claudia C. Heldring
----------------------------
Name: Claudia C. Heldring
Title: Vice President
By /s/ Carla S. Waggoner
-----------------------------
Name: Carla S. Waggoner
Title: Assistant Vice President
Schedule I
SCHEDULE OF DEPOSITS
---------------------------------
(Class A)
DATE TAIL NO. DEPOSIT AMOUNT ACCOUNT NO. MATURITY DATE
8/31/99 N717UW $15,843,630.00 573312 August 7, 2000
8/31/99 N718UW $15,939,308.00 573333 August 7, 2000
8/31/99 N107US $18,702,123.00 573348 August 7, 2000
8/31/99 N108UW $18,702,123.00 573381 August 7, 2000
8/31/99 N719US $15,862,662.00 573440 August 7, 2000
8/31/99 N720US $15,862,662.00 573480 August 7, 2000
8/31/99 N109UW $18,603,314.00 573406 August 7, 2000
8/31/99 N721UW $15,788,922.00 573506 August 7, 2000
8/31/99 N722US $15,788,922.00 573529 August 7, 2000
8/31/99 N723UW $15,924,216.00 573540 August 7, 2000
8/31/99 N724UW $15,972,032.00 573557 August 7, 2000
8/31/99 N725UW $15,972,032.00 573568 August 7, 2000
8/31/99 N110UW $18,929,870.00 573587 August 7, 2000
8/31/99 N111US $18,929,870.00 573606 August 7, 2000
8/31/99 N726US $15,848,794.00 573621 August 7, 2000
8/31/99 N727UW $15,997,257.00 573635 August 7, 2000
8/31/99 N728UW $16,113,107.00 573638 August 7, 2000
8/31/99 N729US $16,019,005.00 573641 August 7, 2000
8/31/99 N670UW $42,060,285.00 573655 August 7, 2000
8/31/99 N671UW $42,023,866.00 573677 August 7, 2000
EXHIBIT A
NOTICE OF PURCHASE WITHDRAWAL
ABN AMRO BANK N.V.
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Lukas van der Hoef
Telecopier: (312) 606-8428
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class A) dated as of
August 31, 1999 (the "Deposit Agreement") between First Security Bank,
National Association, as Escrow Agent, and ABN AMRO Bank N.V., Chicago
Branch, as Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of the
Deposit, $__________, Account No. __________.
The undersigned hereby directs the Depositary to pay the proceeds
of the Deposit to _______________, Account No. __________, Reference:
__________ on _______________, _____, upon the telephonic request of a
representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
By ___________________________
Name:
Title:
Dated: ___________, ____
EXHIBIT B
NOTICE OF FINAL WITHDRAWAL
ABN AMRO BANK N.V.
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Lukas van der Hoef
Telecopier: (312) 606-8428
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class A) dated as of
August 31, 1999 (the "Deposit Agreement") between First Security Bank,
National Association, as Escrow Agent, and ABN AMRO Bank N.V., Chicago
Branch, as Depositary (the "Depositary").
In accordance with Section 2.3(b) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of all
Deposits.
The undersigned hereby directs the Depositary to pay the proceeds
of the Deposits and accrued interest thereon to the Paying Agent at
________________________, ABA# ___________, Account ___________,
Attention: ______________, Reference: US Airways 1999-1A EETC.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
By _____________________________
Name:
Title:
Dated: __________, ____
Exhibit 4(a)(v)
DEPOSIT AGREEMENT
(Class B)
Dated as of August 31, 1999
between
FIRST SECURITY BANK, NATIONAL ASSOCIATION
as Escrow Agent
and
ABN AMRO BANK N.V.,
Chicago Branch
as Depositary
TABLE OF CONTENTS
Page
ARTICLE I FORMATION OF DEPOSITS...............................................2
Section 1.1 Acceptance of Depositary......................................2
Section 1.2 Establishment of Accounts.....................................2
ARTICLE II MAINTENANCE OF DEPOSITS............................................2
Section 2.1 Deposits......................................................2
Section 2.2 Interest......................................................2
Section 2.3 Withdrawals...................................................3
Section 2.4 Other Accounts................................................3
ARTICLE III TERMINATION.......................................................4
ARTICLE IV PAYMENTS...........................................................4
ARTICLE V REPRESENTATIONS AND WARRANTIES......................................5
ARTICLE VI TRANSFER...........................................................6
ARTICLE VII AMENDMENT.........................................................6
ARTICLE VIII NOTICES..........................................................6
ARTICLE IX OBLIGATIONS UNCONDITIONAL..........................................7
ARTICLE X ENTIRE AGREEMENT....................................................7
ARTICLE XI GOVERNING LAW......................................................7
ARTICLE XII SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL RIGHT........... 7
ARTICLE XIII COUNTERPARTS.....................................................8
ARTICLE XIV HEAD OFFICE OBLIGATION............................................8
Schedule I Schedule of Deposits
Exhibit A Notice of Purchase Withdrawal
Exhibit B Notice of Final Withdrawal
This DEPOSIT AGREEMENT (Class B) dated as of August 31,
1999 (as amended, modified or supplemented from time to time, this
"Agreement") between First Security Bank, National Association, a national
banking association, as Escrow Agent under the Escrow and Paying Agent
Agreement referred to below (in such capacity, together with its successors
in such capacity, the "Escrow Agent"), and ABN AMRO BANK N.V., a banking
institution organized under the laws of The Netherlands, acting through its
Chicago branch, as depositary bank (the "Depositary").
W I T N E S S E T H
WHEREAS, US Airways, Inc. ("US Airways") and State Street
Bank and Trust Company of Connecticut, National Association, not in its
individual capacity except as otherwise expressly provided therein, but
solely as trustee (in such capacity, together with its successors in such
capacity, the "Pass Through Trustee") have entered into a Trust Supplement,
dated August 31, 1999, to the Pass Through Trust Agreement dated as of July
30, 1999 (together, as amended, modified or supplemented from time to time
in accordance with the terms thereof, the "Pass Through Trust Agreement")
relating to US Airways Pass Through Trust 1999-1B pursuant to which the US
Airways Pass Through Trust, Series 1999-1A Certificates referred to therein
(the "Certificates") are being issued;
WHEREAS, US Airways and Credit Suisse First Boston
Corporation, Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities
Corporation, Salomon Smith Barney Inc. and Deutsche Bank Securities Inc.
(collectively, the "Underwriters" and, together with their respective
transferees and assigns as registered owners of the Certificates, the
"Investors") have entered into an Underwriting Agreement dated as of August
24, 1999 pursuant to which the Pass Through Trustee will issue and sell the
Certificates to the Underwriters;
WHEREAS, US Airways, the Pass Through Trustee, certain
other pass through trustees and certain other persons concurrently herewith
are entering into the Note Purchase Agreement, dated as of the date hereof
(the "Note Purchase Agreement"), pursuant to which the Pass Through Trustee
has agreed to acquire from time to time on or prior to the Delivery Period
Termination Date (as defined in the Note Purchase Agreement) equipment
notes (the "Equipment Notes") issued to finance the acquisition of aircraft
by US Airways, as lessee or as owner, utilizing a portion of the proceeds
from the sale of the Certificates (the "Net Proceeds");
WHEREAS, the Escrow Agent, the Underwriters, the Pass
Through Trustee and State Street Bank and Trust Company of Connecticut,
National Association, as paying agent for the Escrow Agent (in such
capacity, together with its successors in such capacity, the "Paying
Agent") concurrently herewith are entering into an Escrow and Paying Agent
Agreement, dated as of the date hereof (as amended, modified or
supplemented from time to time in accordance with the terms thereof, the
"Escrow and Paying Agent Agreement"); and
WHEREAS, the Underwriters and the Pass Through Trustee
intend that the Net Proceeds be held in escrow by the Escrow Agent on
behalf of the Investors pursuant to the Escrow and Paying Agent Agreement,
subject to withdrawal upon request of and proper certification by the Pass
Through Trustee for the purpose of purchasing Equipment Notes, and that
pending such withdrawal the Net Proceeds be deposited by the Escrow Agent
with the Depositary pursuant to this Agreement, which provides for the
Depositary to pay interest for distribution to the Investors and to
establish accounts from which the Escrow Agent shall make withdrawals upon
request of and proper certification by the Pass Through Trustee.
NOW, THEREFORE, in consideration of the obligations
contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
FORMATION OF DEPOSITS
Section 1.1 Acceptance of Depositary. The Depositary
hereby agrees to act as depositary bank as provided herein and in
connection therewith to accept all amounts to be delivered to or held by
the Depositary pursuant to the terms of this Agreement. The Depositary
further agrees to hold, maintain and safeguard the Deposits and the
Accounts (as defined below) during the term of this Agreement in accordance
with the provisions of this Agreement. The Escrow Agent shall not have any
right to withdraw, assign or otherwise transfer moneys held in the Accounts
except as permitted by this Agreement.
Section 1.2 Establishment of Accounts. The Escrow Agent
hereby instructs the Depositary, and the Depositary agrees, to establish
the separate deposit accounts listed on Schedule I hereto and to establish
such additional separate deposit accounts as may be required in connection
with the deposits contemplated by Section 2.4 hereof (each, an "Account"
and collectively, the "Accounts"), each in the name of the Escrow Agent and
all on the terms and conditions set forth in this Agreement.
ARTICLE II
MAINTENANCE OF DEPOSITS
Section 2.1 Deposits. The Escrow Agent shall direct the
Underwriters to deposit with the Depositary on the date of this Agreement
(the "Deposit Date") in Federal (same day) funds by official check or
checks or wire or other transfer to: Federal Reserve Bank, New York, ABN
NY, Reference: US Airways 1999-1, ABA# 026009580, Account: Chicago
Treasury, Reference: US Airways Deposit and the Depositary shall accept
from the Underwriters, on behalf of the Escrow Agent, the sum of
US$83,384,000. Upon acceptance of such sum, the Depositary shall (i)
establish each of the deposits specified in Schedule I hereto maturing on
the respective dates set forth therein (including any deposit made pursuant
to Section 2.4 hereof, individually, a "Deposit" and, collectively, the
"Deposits") and (ii) credit each Deposit to the related Account as set
forth therein. No amount shall be deposited in any Account other than the
related Deposit.
Section 2.2 Interest. Each Deposit shall bear interest
from and including the date of deposit to but excluding the date of
withdrawal at the rate of 9.01% per annum (computed on the basis of a year
of twelve 30-day months) payable to the Paying Agent on behalf of the
Escrow Agent semi-annually in arrears on each January 20 and July 20,
commencing on January 20, 2000 (each, an "Interest Payment Date"), and on
the date of the Final Withdrawal (as defined below), all in accordance with
the terms of this Agreement (whether or not any such Deposit is withdrawn
on an Interest Payment Date). Interest accrued on any Deposit that is
withdrawn pursuant to a Notice of Purchase Withdrawal (as defined below)
shall be paid on the next Interest Payment Date, notwithstanding any
intervening Final Withdrawal (as defined below).
Section 2.3 Withdrawals. (a) On and after the date seven
(7) days after the establishment of any Deposit, the Escrow Agent may, by
providing at least one (1) Business Day's prior notice of withdrawal to the
Depositary in the form of Exhibit A hereto (a "Notice of Purchase
Withdrawal"), withdraw not less than the entire balance of such Deposit,
except that at any time prior to the actual withdrawal of such Deposit, the
Escrow Agent or the Pass Through Trustee may, by notice to the Depositary,
cancel such withdrawal (including on the scheduled date therefor), and
thereafter such Deposit shall continue to be maintained by the Depositary
in accordance with the original terms thereof. Following such withdrawal
the balance in the related Account shall be zero and the Depositary shall
close such Account. As used herein, "Business Day" means any day, other
than a Saturday, Sunday or other day on which commercial banks are
authorized or required by law to close in New York, New York, Chicago,
Illinois, Pittsburgh, Pennsylvania, Hartford, Connecticut or Salt Lake
City, Utah.
(b) The Escrow Agent may, by providing at least fifteen
(15) days' prior notice of withdrawal to the Depositary in the form of
Exhibit B hereto (a "Notice of Final Withdrawal"), withdraw the entire
amount of all of the remaining Deposits together with the payment by the
Depositary of all accrued and unpaid interest on such Deposits to but
excluding the specified date of withdrawal (a "Final Withdrawal"), on such
date as shall be specified in such Notice of Final Withdrawal. If a Notice
of Final Withdrawal has not been given to the Depositary on or before July
21, 2000 and there are unwithdrawn Deposits on such date, the Depositary
shall pay the amount of the Final Withdrawal to the Paying Agent on August
7, 2000.
(c) If the Depositary receives a duly completed Notice of
Purchase Withdrawal or Notice of Final Withdrawal complying with the
provisions of this Agreement, it shall make the payments specified therein
in accordance with the provisions of this Agreement.
Section 2.4 Other Accounts. On the date of withdrawal of
any Deposit, the Escrow Agent, or the Pass Through Trustee on behalf of the
Escrow Agent, shall be entitled to re-deposit with the Depositary any
portion thereof and the Depositary shall accept the same for deposit
hereunder. Any sums so received for deposit shall be established as a new
Deposit and credited to a new Account, all as more fully provided in
Section 2.1 hereof, and thereafter the provisions of this Agreement shall
apply thereto as fully and with the same force and effect as if such
Deposit had been established on the Deposit Date except that (i) such
Deposit may not be withdrawn prior to the date seven days after the
establishment thereof and (ii) such Deposit shall mature on August 7, 2000
and bear interest as provided in Section 2.2. The Depositary shall promptly
give notice to the Escrow Agent of receipt of each such re-deposit and the
account number assigned thereto.
ARTICLE III
TERMINATION
This Agreement shall terminate on the fifth (5th)
Business Day after the later of the date on which (i) all of the Deposits
shall have been withdrawn and paid as provided herein without any
re-deposit and (ii) all accrued and unpaid interest on the Deposits shall
have been paid as provided herein, but in no event prior to the date on
which the Depositary shall have performed in full its obligations
hereunder.
ARTICLE IV
PAYMENTS
All payments (including, without limitation, those
payments made in respect of Taxes (as defined and provided for below)) made
by the Depositary hereunder shall be paid in United States Dollars and
immediately available funds by wire transfer (i) in the case of accrued
interest on the Deposits payable under Section 2.2 hereof or any Final
Withdrawal, directly to the Paying Agent at State Street Bank and Trust
Company of Connecticut, National Association, c/o State Street Bank and
Trust Company, 2 International Place, 4th Floor, Boston, MA 02110, ABA#
011-0000-28, Account # 9903-9901, Attention: Sandra Thomson, Reference: US
Airways 1999-1B EETC, or to such other account as the Paying Agent may
direct from time to time in writing to the Depositary and the Escrow Agent
and (ii) in the case of any withdrawal of one or more Deposits pursuant to
a Notice of Purchase Withdrawal, directly to or as directed by the Pass
Through Trustee as specified and in the manner provided in such Notice of
Purchase Withdrawal. The Depositary hereby waives any and all rights of
set-off, combination of accounts, right of retention or similar right
(whether arising under applicable law, contract or otherwise) it may have
against the Deposits howsoever arising. All payments on or in respect of
each Deposit shall be made free and clear of and without reduction for or
on account of any and all taxes, levies or other impositions or charges
(collectively, "Taxes"). However, if the Depositary or the Paying
Agent (pursuant to Section 2.4 of the Escrow and Paying Agent Agreement)
shall be required by law to deduct or withhold any Taxes from or in respect
of any sum payable hereunder, the Depositary shall: (i) make such
deductions or withholding; (ii) pay the full amount deducted or withheld
(including in respect of such additional amounts) to the competent taxation
authority; and (iii) if the Taxes required to be deducted or withheld are
imposed by The Netherlands or any political subdivision thereof, pay such
additional amounts as may be necessary in order that the actual amount
received by the designated recipient of such sum under this Agreement or
the Escrow and Paying Agent Agreement after such deduction or withholding
equals the sum it would have received had no such deduction or withholding
been required. If the date on which any payment due on any Deposit would
otherwise fall on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day with the same force and effect as
if made on such scheduled date, and no additional interest shall accrue in
respect of such extension.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Depositary hereby represents and warrants to US
Airways, the Escrow Agent, the Pass Through Trustee and the Paying Agent
that:
(1) it is a bank duly organized and validly existing in
good standing under the laws of its jurisdiction of organization and is
duly qualified to conduct banking business in the State of Illinois through
its Chicago branch;
(2) it has full power, authority and legal right to
conduct its business and operations as currently conducted and to enter
into and perform its obligations under this Agreement;
(3) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on
the part of it and do not require any stockholder approval, or approval or
consent of any trustee or holder of any indebtedness or obligations of it,
and such document has been duly executed and delivered by it and
constitutes its legal, valid and binding obligations enforceable against it
in accordance with the terms hereof;
(4) no authorization, consent or approval of or other
action by, and no notice to or filing with, any United States federal or
state governmental authority or regulatory body is required for the
execution, delivery or performance by it of this Agreement;
(5) neither the execution, delivery or performance by it
of this Agreement, nor compliance with the terms and provisions hereof,
conflicts or will conflict with or results or will result in a breach or
violation of any of the terms, conditions or provisions of, or will require
any consent or approval under, any law, governmental rule or regulation or
the charter documents, as amended, or bylaws, as amended, of it or any
similar instrument binding on it or any order, writ, injunction or decree
of any court or governmental authority against it or by which it or any of
its properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which it is a party or by which it or any of its
properties is bound, or constitutes or will constitute a default thereunder
or results or will result in the imposition of any lien upon any of its
properties; and
(6) there are no pending or, to its knowledge, threatened
actions, suits, investigations or proceedings (whether or not purportedly
on behalf of it) against or affecting it or any of its property before or
by any court or administrative agency which, if adversely determined, (i)
would adversely affect the ability of it to perform its obligations under
this Agreement or (ii) would call into question or challenge the validity
of this Agreement or the enforceability hereof in accordance with the terms
hereof, nor is the Depositary in default with respect to any order of any
court, governmental authority, arbitration board or administrative agency
so as to adversely affect its ability to perform its obligations under this
Agreement.
ARTICLE VI
TRANSFER
Neither party hereto shall be entitled to assign or
otherwise transfer this Agreement (or any interest herein) other than (in
the case of the Escrow Agent) to a successor escrow agent under Section 1.7
of the Escrow and Paying Agent Agreement, and any purported assignment in
violation thereof shall be void. This Agreement shall be binding upon the
parties hereto and their respective successors and (in the case of the
Escrow Agent) permitted assigns.
ARTICLE VII
AMENDMENT
This Agreement may not be amended, waived or otherwise
modified except by an instrument in writing signed by the party against
whom the amendment, waiver or other modification is sought to be enforced
and by the Pass Through Trustee.
ARTICLE VIII
NOTICES
Unless otherwise expressly provided herein, any notice or
other communication under this Agreement shall be in writing (including by
facsimile) and shall be deemed to be given and effective upon receipt
thereof. All notices shall be sent to (x) in the case of the Depositary,
ABN AMRO BANK N.V., 135 South LaSalle Street, Chicago, Illinois 60603,
Attention: Vice President-Aerospace (Telecopier: (312) 606-8428, with a
copy to ABN AMRO BANK N.V., Chicago Branch 181 W. Madison Street, Chicago
Illinois 60602 Attention: Money Market Desk (Telecopier: (312) 904-9107) or
(y) in the case of the Escrow Agent, First Security Bank, National
Association, 79 South Main Street, Salt Lake City, UT 84111, Attention:
Corporate Trust Services (Telecopier: (801) 246-5053), in each case, with a
copy to the Pass Through Trustee, State Street Bank and Trust Company of
Connecticut, National Association, 225 Asylum Street, Goodwyn Square,
Hartford, CT 06103, Attention: Corporate/Muni. Department (Telecopier:
(860) 244-1889) and to US Airways, US Airways, Inc., 2345 Crystal Drive,
Arlington, VA 22227, Attention: Treasurer (Telecopier: (703) 872-5936) (or
at such other address as any such party may specify from time to time in a
written notice to the parties hereto). On or prior to the execution of this
Agreement, the Escrow Agent has delivered to the Depositary a certificate
containing specimen signatures of the representatives of the Escrow Agent
who are authorized to give notices and instructions with respect to this
Agreement. The Depositary may conclusively rely on such certificate until
the Depositary receives written notice from the Escrow Agent to the
contrary.
ARTICLE IX
OBLIGATIONS UNCONDITIONAL
The Depositary hereby acknowledges and agrees that its
obligation to repay each Deposit together with interest thereon as provided
herein is absolute, irrevocable and unconditional and constitutes a full
recourse obligation of the Depositary enforceable against it to the full
extent of all of its assets and properties.
ARTICLE X
ENTIRE AGREEMENT
This Agreement (including all attachments hereto) sets
forth all of the promises, covenants, agreements, conditions and
understandings between the Depositary and the Escrow Agent with respect to
the subject matter hereof and supersedes all prior and contemporaneous
agreements and undertakings, inducements or conditions, express or implied,
oral or written.
ARTICLE XI
GOVERNING LAW
THIS AGREEMENT, AND THE RIGHTS AND OBLIGATIONS OF THE
DEPOSITARY AND THE ESCROW AGENT WITH RESPECT TO THE DEPOSITS, SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK AND SUBJECT TO THE PROVISIONS OF REGULATION D OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM (OR ANY SUCCESSOR), AS THE SAME MAY
BE MODIFIED AND SUPPLEMENTED AND IN EFFECT FROM TIME TO TIME.
ARTICLE XII
SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL RIGHT
SECTION 12.1 Submission to Jurisdiction. Each of the
Depositary and the Escrow Agent hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal
action or proceeding relating to this Agreement, or
for recognition and enforcement of any judgment in
respect hereof, to the nonexclusive general
jurisdiction of the courts of the State of New York,
the courts of the United States of America for the
Southern District of New York, and the appellate
courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts, and waives any objection that
it may now or hereafter have to the venue of any such
action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient
court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof
by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to each party
hereto at its address set forth in Article VIII
hereof, or at such other address of which shall have
been notified pursuant thereto; and
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner
permitted by law or shall limit the right to sue in
any other jurisdiction.
SECTION 12.2 WAIVER OF JURY TRIAL RIGHT. EACH OF THE DEPOSITARY
AND THE ESCROW AGENT ACKNOWLEDGES AND ACCEPTS THAT IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT SUCH PARTY
IRREVOCABLY WAIVES ITS RIGHT TO A TRIAL BY JURY.
ARTICLE XIII
COUNTERPARTS
This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one instrument.
ARTICLE XIV
HEAD OFFICE OBLIGATION
ABN AMRO Bank N.V. hereby agrees that the obligations of
the Depositary hereunder are also the obligations of ABN AMRO Bank N.V.'s
Head Office in The Netherlands. Accordingly, any beneficiary of this
Agreement will be able to proceed directly against ABN AMRO Bank N.V.'s
Head Office in The Netherlands if ABN AMRO Bank N.V.'s Chicago branch
defaults in its obligation to such beneficiary under this Agreement.
IN WITNESS WHEREOF, the Escrow Agent and the Depositary have caused this
Deposit Agreement to be duly executed as of the day and year first above
written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, as Escrow Agent
By /s/ Brett R. King
_______________________
Name: Brett R. King
Title: Vice President
ABN AMRO Bank, N.V.,
Chicago Branch, as Depositary
By /s/ Claudia C. Heldring
__________________________
Name: Claudia C. Heldring
Title: Vice President
By /s/ Carla S. Waggoner
__________________________
Name: Carla S. Waggoner
Title: Assistant Vice President
<TABLE>
<CAPTION>
Schedule I
SCHEDULE OF DEPOSITS
---------------------------------
(Class B)
<S> <C> <C> <C> <C> <C>
DATE TAIL NO. DEPOSIT ACCOUNT NO. MATURITY DATE
AMOUNT
8/31/99 N717UW $2,669,915.00 573320 August 7, 2000
8/31/99 N718UW $2,360,746.00 573339 August 7, 2000
8/31/99 N107US $2,479,994.00 573362 August 7, 2000
8/31/99 N108UW $2,479,994.00 573388 August 7, 2000
8/31/99 N719US $2,370,261.00 573452 August 7, 2000
8/31/99 N720US $2,370,261.00 573485 August 7, 2000
8/31/99 N109UW $2,484,412.00 573416 August 7, 2000
8/31/99 N721UW $2,545,861.00 573518 August 7, 2000
8/31/99 N722US $2,545,861.00 573531 August 7, 2000
8/31/99 N723UW $2,237,783.00 573546 August 7, 2000
8/31/99 N724UW $2,570,858.00 573561 August 7, 2000
8/31/99 N725UW $2,570,858.00 573570 August 7, 2000
8/31/99 N110UW $2,420,121.00 573594 August 7, 2000
8/31/99 N111US $2,420,121.00 573616 August 7, 2000
8/31/99 N726US $2,434,532.00 573624 August 7, 2000
8/31/99 N727UW $2,154,151.00 573636 August 7, 2000
8/31/99 N728UW $2,618,570.00 573639 August 7, 2000
8/31/99 N729US $2,649,792.00 573644 August 7, 2000
8/31/99 N670UW $19,322,457.00 573663 August 7, 2000
8/31/99 N671UW $19,677,452.00 573687 August 7, 2000
</TABLE>
EXHIBIT A
NOTICE OF PURCHASE WITHDRAWAL
ABN AMRO BANK N.V.
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Lukas van der Hoef
Telecopier: (312) 606-8428
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class B)
dated as of August 31, 1999 (the "Deposit Agreement") between First
Security Bank, National Association, as Escrow Agent, and ABN AMRO Bank
N.V., Chicago Branch, as Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit
Agreement, the undersigned hereby requests the withdrawal of the entire
amount of the Deposit, $__________, Account No.
- ----------.
The undersigned hereby directs the Depositary to pay the
proceeds of the Deposit to _______________, Account No. __________,
Reference: __________ on _______________, _____, upon the telephonic
request of a representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
By____________________________
Name:
Title:
Dated: ___________, ____
EXHIBIT B
NOTICE OF FINAL WITHDRAWAL
ABN AMRO BANK N.V.
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Lukas van der Hoef
Telecopier: (312) 606-8428
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class B)
dated as of August 31, 1999 (the "Deposit Agreement") between First
Security Bank, National Association, as Escrow Agent, and ABN AMRO Bank
N.V., Chicago Branch, as Depositary (the "Depositary").
In accordance with Section 2.3(b) of the Deposit
Agreement, the undersigned hereby requests the withdrawal of the entire
amount of all Deposits.
The undersigned hereby directs the Depositary to pay the
proceeds of the Deposits and accrued interest thereon to the Paying Agent
at ________________________, ABA# ___________, Account ___________,
Attention: ______________, Reference: US Airways
1999-1B EETC.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
By_____________________________
Name:
Title:
Dated: __________, ____
[GRAPHIC OMITTED]
Exhibit 4(a)(vi)
-----------------------------------------------------------------
REVOLVING CREDIT AGREEMENT
(1999-1A)
Dated as of August 31, 1999
between
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Subordination Agent,
as agent and trustee for the
US Airways Pass Through Trust 1999-1A
as Borrower
and
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
-----------------------------------------------------------------
Relating to
US Airways Pass Through Trust 1999-1A
8.36% US Airways Pass Through Certificates,
Series 1999-1A
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
ARTICLE I DEFINITIONS...................................................................1
Section 1.01. Certain Defined Terms..................................................1
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT...........................................6
Section 2.01. The Advances...........................................................6
Section 2.02. Making the Advances....................................................7
Section 2.03. Fees...................................................................9
Section 2.04. Reductions or Termination of the Maximum Commitment....................9
Section 2.05. Repayments of Interest Advances or the Final Advance...................9
Section 2.06. Repayments of Provider Advances........................................9
Section 2.07. Payments to the Liquidity Provider Under the Intercreditor Agreement..10
Section 2.08. Book Entries..........................................................11
Section 2.09. Payments from Available Funds Only....................................11
Section 2.10. Extension of the Expiry Date; Non-Extension Advance...................11
ARTICLE III OBLIGATIONS OF THE BORROWER................................................12
Section 3.01. Increased Costs.......................................................12
Section 3.02. Capital Adequacy......................................................13
Section 3.03. Payments Free of Deductions...........................................14
Section 3.04. Payments..............................................................14
Section 3.05. Computations..........................................................14
Section 3.06. Payment on Non-Business Days..........................................14
Section 3.07. Interest..............................................................15
Section 3.08. Replacement of Borrower...............................................16
Section 3.09. Funding Loss Indemnification..........................................16
Section 3.10. Illegality............................................................17
ARTICLE IV CONDITIONS PRECEDENT........................................................17
Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.................17
Section 4.02. Conditions Precedent to Borrowing.....................................19
ARTICLE V COVENANTS....................................................................19
Section 5.01. Affirmative Covenants of the Borrower.................................19
Section 5.02. Negative Covenants of the Borrower....................................20
ARTICLE VI LIQUIDITY EVENTS OF DEFAULT.................................................20
Section 6.01. Liquidity Events of Default...........................................20
ARTICLE VII MISCELLANEOUS..............................................................20
Section 7.01. Amendments, Etc.......................................................20
Section 7.02. Notices, Etc..........................................................20
Section 7.03. No Waiver; Remedies...................................................22
Section 7.04. Further Assurances....................................................22
Section 7.05. Indemnification; Survival of Certain Provisions.......................22
Section 7.06. Liability of the Liquidity Provider...................................22
Section 7.07. Costs, Expenses and Taxes.............................................23
Section 7.08. Binding Effect; Participations........................................24
Section 7.09. Severability..........................................................25
Section 7.10. GOVERNING LAW.........................................................25
Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity..25
Section 7.12. Execution in Counterparts.............................................26
Section 7.13. Entirety..............................................................26
Section 7.14. Headings..............................................................26
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES......................27
</TABLE>
ANNEX I Interest Advance Notice of Borrowing
ANNEX II Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV Final Advance Notice of Borrowing
ANNEX V Notice of Termination
ANNEX VI Notice of Replacement Subordination Agent
REVOLVING CREDIT AGREEMENT (1999-1A)
This REVOLVING CREDIT AGREEMENT (1999-1A) dated as of
August 31, 1999, between STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not
in its individual capacity but solely as Subordination Agent under the
Intercreditor Agreement (each as defined below), as agent and trustee
for the Class A Trust (as defined below) (the "Borrower"), and AIG
MATCHED FUNDING CORP., a corporation organized under the laws of the
State of Delaware (the "Liquidity Provider").
W I T N E S S E T H:
WHEREAS, pursuant to the Class A Trust Agreement (such
term and all other capitalized terms used in these recitals having the
meanings set forth or referred to in Section 1.01), the Class A Trust
is issuing the Class A Certificates; and
WHEREAS, the Borrower, in order to support the timely
payment of a portion of the interest on the Class A Certificates in
accordance with their terms, has requested the Liquidity Provider to
enter into this Agreement, providing in part for the Borrower to
request in specified circumstances that Advances be made hereunder.
NOW, THEREFORE, in consideration of the premises, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms. (a) Definitions. As
used in this Agreement and unless otherwise expressly indicated, or unless
the context clearly requires otherwise, the following capitalized terms
shall have the following respective meanings for all purposes of this
Agreement:
"Additional Cost" has the meaning assigned to such term in
Section 3.01.
"Advance" means an Interest Advance, a Final Advance, a
Provider Advance, an Applied Provider Advance or an Unpaid Advance, as the
case may be.
"Applicable Liquidity Rate" has the meaning assigned to such
term in Section 3.07(g).
"Applicable Margin" means (x) with respect to any Unpaid
Advance or Applied Provider Advance, 1.75%, (y) with respect to any
Unapplied Provider Advance, the rate per annum specified in the Fee Letter.
"Applied Downgrade Advance" has the meaning assigned to such
term in Section 2.06(a).
"Applied Non-Extension Advance" has the meaning assigned to
such term in Section 2.06(a).
"Applied Provider Advance" has the meaning assigned to such
term in Section 2.06(a).
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be equal
to (a) the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by the Liquidity Provider from three Federal funds
brokers of recognized standing selected by it, plus (b) one quarter of one
percent (1/4 of 1%) per annum.
"Base Rate Advance" means an Advance that bears interest at
a rate based upon the Base Rate.
"Borrower" has the meaning assigned to such term in the
recital of parties to this Agreement.
"Borrowing" means the making of Advances requested by
delivery of a Notice of Borrowing.
"Business Day" means any day other than a Saturday or Sunday
or a day on which commercial banks are required or authorized to close in
New York, New York, Pittsburgh, Pennsylvania, or, so long as any Class A
Certificate is outstanding, the city and state in which the Class A
Trustee, the Borrower or any Loan Trustee maintains its Corporate Trust
Office or receives or disburses funds, and, if the applicable Business Day
relates to any Advance or other amount bearing interest based on the LIBOR
Rate, on which dealings are carried on in the London interbank market.
"Deposits" has the meaning assigned to such terms in the
Deposit Agreement.
"Depositary" has the meaning assigned to such term in the
Deposit Agreement.
"Deposit Agreement" means the Deposit Agreement dated as of
the date hereof between First Security Bank, National Association, as
Escrow Agent and ABN AMRO Bank, N.V., acting through its Chicago branch, as
Depositary, pertaining to the Class A Certificates, as the same may be
amended, modified or supplemented from time to time in accordance with the
terms thereof.
"Downgrade Advance" means an Advance made pursuant to
Section 2.02(c).
"Effective Date" has the meaning specified in Section 4.01.
The delivery of the certificate of the Liquidity Provider contemplated by
Section 4.01(e) shall be conclusive evidence that the Effective Date has
occurred.
"Excluded Taxes" means (i) taxes imposed on the overall net
income of the Liquidity Provider or of its Facility Office by the
jurisdiction where such Liquidity Provider's principal office or such
Facility Office is located, and (ii) Excluded Withholding Taxes.
"Excluded Withholding Taxes" means (i) withholding Taxes
imposed by the United States except to the extent that such United States
withholding Taxes are imposed as a result of any change in applicable law
(excluding from change in applicable law for this purpose a change in an
applicable treaty or other change in law affecting the applicability of a
treaty) after the date hereof, or in the case of a successor Liquidity
Provider (including a transferee of an Advance) or Facility Office, after
the date on which such successor Liquidity Provider obtains its interest or
on which the Facility Office is changed, and (ii) any withholding Taxes
imposed by the United States which are imposed or increased as a result of
the Liquidity Provider failing to deliver to the Borrower any certificate
or document (which certificate or document in the good faith judgment of
the Liquidity Provider it is legally entitled to provide) which is
reasonably requested by the Borrower to establish that payments under this
Agreement are exempt from (or entitled to a reduced rate of) withholding
Tax.
"Expenses" means liabilities, obligations, damages,
settlements, penalties, claims, actions, suits, costs, expenses, and
disbursements (including, without limitation, reasonable fees and
disbursements of legal counsel and costs of investigation), provided that
Expenses shall not include any Taxes.
"Expiry Date" means August 28, 2000, initially, or any date
to which the Expiry Date is extended pursuant to Section 2.10.
"Facility Office" means the Facility Office of the Liquidity
Provider presently located at Westport, Connecticut, or such other Facility
Office as the Liquidity Provider from time to time shall notify the
Borrower as its Facility Office hereunder; provided that the Liquidity
Provider shall not change its Facility Office to a Facility Office outside
the United States of America except in accordance with Section 3.01, 3.02
or 3.03 hereof.
"Final Advance" means an Advance made pursuant to Section
2.02(d).
"Intercreditor Agreement" means the Intercreditor Agreement
dated the date hereof, among the Trustees, the Liquidity Provider, the
liquidity provider under each Liquidity Facility (other than this
Agreement) and the Subordination Agent, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Interest Advance" means an Advance made pursuant to Section
2.02(a).
"Interest Period" means, with respect to any LIBOR Advance,
each of the following periods:
(i) the period beginning on the third Business Day
following either (x) the Liquidity Provider's
receipt of the Notice of Borrowing for such LIBOR
Advance or (y) the date of the withdrawal of funds
from the Class A Cash Collateral Account for the
purpose of paying interest on the Class A
Certificates as contemplated by Section 2.06(a)
hereof and, in either case, ending on the next
Regular Distribution Date; and
(ii) each subsequent period commencing on the last day of
the immediately preceding Interest Period and ending
on the next Regular Distribution Date;
provided, however, that if (x) the Final Advance shall have
been made, or (y) other outstanding Advances shall have been
converted into the Final Advance, then the Interest Periods
shall be successive periods of one month beginning on the
third Business Day following the Liquidity Provider's
receipt of the Notice of Borrowing for such Final Advance
(in the case of clause (x) above) or the Regular
Distribution Date following such conversion (in the case of
clause (y) above).
"LIBOR Advance" means an Advance bearing interest at a rate
based upon the LIBOR Rate.
"LIBOR Rate" means, with respect to any Interest Period:
(i) the rate per annum appearing on display page 3750
(British Bankers Association-LIBOR) of the Dow Jones
Markets Service (or any successor or substitute
therefor ) at approximately 11:00 A.M. (London time)
two Business Days before the first day of such
Interest Period, as the rate for dollar deposits
with a maturity comparable to such Interest Period,
or
(ii) if the rate calculated pursuant to clause (i) above
is not available, the average (rounded upwards, if
necessary, to the next 1/16 of 1%) of the rates per
annum at which deposits in dollars are offered for
the relevant Interest Period by three banks of
recognized standing selected by the Liquidity
Provider in the London interbank market at
approximately 11:00 A.M. (London time) two Business
Days before the first day of such Interest Period in
an amount approximately equal to the principal
amount of the LIBOR Advance to which such Interest
Period is to apply and for a period comparable to
such Interest Period.
"Liquidity Event of Default" means the occurrence of either
(a) the Acceleration of all of the Equipment Notes (provided that, with
respect to the period prior to the Delivery Period Expiry Date, such
Equipment Notes have an aggregate outstanding principal balance in excess
of $300,000,000) or (b) a US Airways Bankruptcy Event.
"Liquidity Indemnitee" means (i) the Liquidity Provider,
(ii) the directors, officers, employees and agents of the Liquidity
Provider, and (iii) the successors and permitted assigns of the persons
described in clauses (i) and (ii), inclusive.
"Liquidity Provider" has the meaning assigned to such term
in the recital of parties to this Agreement.
"Maximum Available Commitment" shall mean, subject to the
proviso contained in the third sentence of Section 2.02(a), at any time of
determination, (a) the Maximum Commitment at such time less (b) the
aggregate amount of each Interest Advance outstanding at such time;
provided that following a Provider Advance or a Final Advance, the Maximum
Available Commitment shall be zero.
"Maximum Commitment" means initially $48,264,453.60, as the
same may be reduced from time to time in accordance with Section 2.04(a).
"Non-Excluded Tax" has the meaning specified in Section 3.03.
"Non-Extension Advance" means an Advance made pursuant to
Section 2.02(b).
"Notice of Borrowing" has the meaning specified in Section
2.02(e).
"Notice of Replacement Subordination Agent" has the meaning
specified in Section 3.08.
"Performing Note Deficiency" means any time that less than
65% of the then aggregate outstanding principal amount of all Equipment
Notes are Performing Equipment Notes.
"Prospectus Supplement" means the Prospectus Supplement
dated August 24, 1999 relating to the Class A Certificates and the Class B
Certificates, as such Prospectus Supplement may be amended or supplemented.
"Provider Advance" means a Downgrade Advance or a
Non-Extension Advance.
"Regulatory Change" has the meaning assigned to such term in
Section 3.01.
"Replenishment Amount" has the meaning assigned to such term
in Section 2.06(b).
"Required Amount" means, for any day, the sum of the
aggregate amount of interest, calculated at the rate per annum equal to the
Stated Interest Rate for the Class A Certificates, that would be payable on
the Class A Certificates on each of the three successive semiannual Regular
Distribution Dates immediately following such day or, if such day is a
Regular Distribution Date, on such day and the succeeding two semiannual
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of the Class A Certificates on such day and without regard to
expected future payments of principal on the Class A Certificates.
"Termination Date" means the earliest to occur of the
following: (i) the Expiry Date; (ii) the date on which the Borrower
delivers to the Liquidity Provider a certificate, signed by a Responsible
Officer of the Borrower, certifying that all of the Class A Certificates
have been paid in full (or provision has been made for such payment in
accordance with the Intercreditor Agreement and the Trust Agreements) or
are otherwise no longer entitled to the benefits of this Agreement; (iii)
the date on which the Borrower delivers to the Liquidity Provider a
certificate, signed by a Responsible Officer of the Borrower, certifying
that a Replacement Liquidity Facility has been substituted for this
Agreement in full pursuant to Section 3.6(e) of the Intercreditor
Agreement; (iv) the fifth Business Day following the receipt by the
Borrower of a Termination Notice from the Liquidity Provider pursuant to
Section 6.01 hereof; and (v) the date on which no Advance is or may
(including by reason of reinstatement as herein provided) become available
for a Borrowing hereunder.
"Termination Notice" means the Notice of Termination
substantially in the form of Annex V to this Agreement.
"Transferee" has the meaning assigned to such term in
Section 7.08(b).
"Unapplied Downgrade Advance" means any Downgrade Advance
other than an Applied Downgrade Advance.
"Unapplied Provider Advance" means any Provider Advance
other than an Applied Provider Advance.
"Unpaid Advance" has the meaning assigned to such term in
Section 2.05.
(b) Terms Defined in the Intercreditor Agreement. For all
purposes of this Agreement, the following terms shall have the respective
meanings assigned to such terms in the Intercreditor Agreement:
"Acceleration", "AIFS", "Certificates", "Class A Cash
Collateral Account", "Class A Certificates", "Class A Certificateholders",
"Class A Trust", "Class A Trust Agreement", "Class A Trustee", "Class B
Certificates", "Class C Certificates", "Class C Purchase Agreement",
"Closing Date", "Controlling Party", "Corporate Trust Office", "Delivery
Period Expiry Date", "Distribution Date", "Downgraded Facility", "Equipment
Notes", "Fee Letter", "Final Legal Distribution Date", "Financing
Agreement", "Indenture", "Interest Payment Date", "Investment Earnings",
"Leased Aircraft", "Liquidity Facility", "Liquidity Obligations", "Loan
Trustee", "Moody's", "Non-Extended Facility", "Note Purchase Agreement",
"Operative Agreements", "Owned Aircraft", "Participation Agreement",
"Performing Equipment Note", "Person", "Pool Balance", "Rating Agency",
"Ratings Confirmation", "Regular Distribution Date", "Replacement Liquidity
Facility", "Responsible Officer", "Scheduled Payment", "Special Payment",
"Standard & Poor's", "Stated Interest Rate", "Subordination Agent",
"Taxes", "Threshold Rating", "Trust Agreements", "Trustee", "Underwriters",
"Underwriting Agreement", "US Airways", "US Airways Bankruptcy Event" and
"Written Notice".
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. The Advances. The Liquidity Provider hereby
irrevocably agrees, on the terms and conditions hereinafter set forth, to
make Advances to the Borrower from time to time on any Business Day during
the period from the Effective Date until 12:00 Noon (New York City time) on
the Expiry Date (unless the obligations of the Liquidity Provider shall be
earlier terminated in accordance with the terms of Section 2.04(b)) in an
aggregate amount at any time outstanding not to exceed the Maximum
Commitment.
Section 2.02. Making the Advances. (a) Interest Advances
shall be made in one or more Borrowings by delivery to the Liquidity
Provider of one or more written and completed Notices of Borrowing in
substantially the form of Annex I attached hereto, signed by a Responsible
Officer of the Borrower, in an amount not exceeding the Maximum Available
Commitment at such time and shall be used solely for the payment when due
of interest on the Class A Certificates at the Stated Interest Rate
therefor in accordance with Section 3.6(a) of the Intercreditor Agreement.
Each Interest Advance made hereunder shall automatically reduce the Maximum
Available Commitment and the amount available to be borrowed hereunder by
subsequent Advances by the amount of such Interest Advance (subject to
reinstatement as provided in the next sentence). Upon repayment to the
Liquidity Provider of all or any part of the amount of any Interest Advance
made pursuant to this Section 2.02(a), together with accrued interest
thereon (as provided herein), the Maximum Available Commitment shall be
reinstated by the amount of such repaid Interest Advance, but not to exceed
the Maximum Commitment; provided, however, that the Maximum Available
Commitment shall not be so reinstated at any time if (i) a Liquidity Event
of Default shall have occurred and be continuing and (ii) there is a
Performing Note Deficiency.
(b) A Non-Extension Advance shall be made in a single
Borrowing if this Agreement is not extended in accordance with Section
3.6(d) of the Intercreditor Agreement (unless a Replacement Liquidity
Facility to replace this Agreement shall have been delivered to the
Borrower as contemplated by said Section 3.6(d) within the time period
specified in such Section) by delivery to the Liquidity Provider of a
written and completed Notice of Borrowing in substantially the form of
Annex II attached hereto, signed by a Responsible Officer of the Borrower,
in an amount equal to the Maximum Available Commitment at such time, and
shall be used to fund the Class A Cash Collateral Account in accordance
with said Section 3.6(d) and Section 3.6(f) of the Intercreditor Agreement.
(c) A Downgrade Advance shall be made in a single Borrowing
upon a downgrading of the Liquidity Provider's short-term unsecured debt
rating issued by either Rating Agency below the applicable Threshold Rating
(as provided for in Section 3.6(c) of the Intercreditor Agreement) unless a
Replacement Liquidity Facility to replace this Agreement shall have been
previously delivered to the Borrower in accordance with said Section 3.6(c)
and within the time period specified in such Section, by delivery to the
Liquidity Provider of a written and completed Notice of Borrowing in
substantially the form of Annex III attached hereto, signed by a
Responsible Officer of the Borrower, in an amount equal to the Maximum
Available Commitment at such time, and shall be used to fund the Class A
Cash Collateral Account in accordance with said Section 3.6(c) and Section
3.6(f) of the Intercreditor Agreement.
(d) A Final Advance shall be made in a single Borrowing upon
the receipt by the Borrower of a Termination Notice from the Liquidity
Provider pursuant to Section 6.01 hereof by delivery to the Liquidity
Provider of a written and completed Notice of Borrowing in substantially
the form of Annex IV attached hereto, signed by a Responsible Officer of
the Borrower, in an amount equal to the Maximum Available Commitment at
such time, and shall be used to fund the Class A Cash Collateral Account in
accordance with Section 3.6(i) and Section 3.6(f) of the Intercreditor
Agreement.
(e) Each Borrowing shall be made on notice in writing (a
"Notice of Borrowing") in substantially the form required by Section
2.02(a), 2.02(b), 2.02(c) or 2.02(d), as the case may be, given by the
Borrower to the Liquidity Provider. If a Notice of Borrowing is delivered
by the Borrower in respect of any Borrowing no later than 1:00 p.m. (New
York City time) on a Business Day, upon satisfaction of the conditions
precedent set forth in Section 4.02 with respect to a requested Borrowing,
the Liquidity Provider shall make available to the Borrower, in accordance
with its payment instructions, the amount of such Borrowing in U.S. dollars
and immediately available funds, before 4:00 p.m. (New York City time) on
such Business Day or on such later Business Day specified in such Notice of
Borrowing. If a Notice of Borrowing is delivered by the Borrower in respect
of any Borrowing after 1:00 p.m. (New York City time) on a Business Day,
upon satisfaction of the conditions precedent set forth in Section 4.02
with respect to a requested Borrowing, the Liquidity Provider shall make
available to the Borrower, in accordance with its payment instructions, the
amount of such Borrowing in U.S. dollars and in immediately available
funds, before 12:00 noon (New York City time) on the first Business Day
next following the day of receipt of such Notice of Borrowing or on such
later Business Day specified by the Borrower in such Notice of Borrowing.
Payments of proceeds of a Borrowing shall be made by wire transfer of
immediately available funds to the Borrower in accordance with such wire
transfer instructions as the Borrower shall furnish from time to time to
the Liquidity Provider for such purpose. Each Notice of Borrowing shall be
irrevocable and binding on the Borrower.
(f) Upon the making of any Advance requested pursuant to a
Notice of Borrowing, in accordance with the Borrower's payment
instructions, the Liquidity Provider shall be fully discharged of its
obligation hereunder with respect to such Notice of Borrowing, and the
Liquidity Provider shall not thereafter be obligated to make any further
Advances hereunder in respect of such Notice of Borrowing to the Borrower
or to any other Person. Following the making of any Advance pursuant to
Section 2.02(b), (c) or (d) hereof to fund the Class A Cash Collateral
Account, the Liquidity Provider shall have no interest in or rights to the
Class A Cash Collateral Account, such Advance or any other amounts from
time to time on deposit in the Class A Cash Collateral Account; provided
that the foregoing shall not affect or impair the obligations of the
Subordination Agent to make the distributions contemplated by Section
3.6(e) or (f) of the Intercreditor Agreement, and provided further, that
the foregoing shall not affect or impair the rights of the Liquidity
Provider to provide written instructions with respect to the investment and
reinvestment of amounts in the Cash Collateral Accounts to the extent
provided in Section 2.2(b) of the Intercreditor Agreement. By paying to the
Borrower proceeds of Advances requested by the Borrower in accordance with
the provisions of this Agreement, the Liquidity Provider makes no
representation as to, and assumes no responsibility for, the correctness or
sufficiency for any purpose of the amount of the Advances so made and
requested.
Section 2.03. Fees. The Borrower agrees to pay to the
Liquidity Provider the fees set forth in the Fee Letter.
Section 2.04. Reductions or Termination of the Maximum
Commitment.
(a) Automatic Reduction. Promptly following each date on
which the Required Amount is reduced as a result of a reduction in the Pool
Balance of the Class A Certificates or otherwise, the Maximum Commitment
shall automatically be reduced to an amount equal to such reduced Required
Amount (as calculated by the Borrower). The Borrower shall give notice of
any such automatic reduction of the Maximum Commitment to the Liquidity
Provider within two Business Days thereof. The failure by the Borrower to
furnish any such notice shall not affect such automatic reduction of the
Maximum Commitment.
(b) Termination. Upon the making of any Provider Advance or
Final Advance hereunder or the occurrence of the Termination Date, the
obligation of the Liquidity Provider to make further Advances hereunder
shall automatically and irrevocably terminate, and the Borrower shall not
be entitled to request any further Borrowing hereunder.
Section 2.05. Repayments of Interest Advances or the Final
Advance. Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower
hereby agrees, without notice of an Advance or demand for repayment from
the Liquidity Provider (which notice and demand are hereby waived by the
Borrower), to pay, or to cause to be paid, to the Liquidity Provider on
each date on which the Liquidity Provider shall make an Interest Advance or
the Final Advance, an amount equal to (a) the amount of such Advance (any
such Advance, until repaid, is referred to herein as an "Unpaid Advance"),
plus (b) interest on the amount of each such Unpaid Advance as provided in
Section 3.07 hereof; provided that if (i) the Liquidity Provider shall make
a Provider Advance at any time after making one or more Interest Advances
which shall not have been repaid in accordance with this Section 2.05 or
(ii) this Liquidity Facility shall become a Downgraded Facility or
Non-Extended Facility at any time when unreimbursed Interest Advances have
reduced the Maximum Available Commitment to zero, then such Interest
Advances shall cease to constitute Unpaid Advances and shall be deemed to
have been changed into an Applied Downgrade Advance or an Applied
Non-Extension Advance, as the case may be, for all purposes of this
Agreement (including, without limitation, for the purpose of determining
when such Interest Advance is required to be repaid to the Liquidity
Provider in accordance with Section 2.06 and for the purposes of Section
2.06(b)). The Borrower and the Liquidity Provider agree that the repayment
in full of each Interest Advance and Final Advance on the date such Advance
is made is intended to be a contemporaneous exchange for new value given to
the Borrower by the Liquidity Provider.
Section 2.06. Repayments of Provider Advances. (a) Amounts
advanced hereunder in respect of a Provider Advance shall be deposited in
the Class A Cash Collateral Account, invested and withdrawn from the Class
A Cash Collateral Account as set forth in Sections 3.6(c), (d) and (f) of
the Intercreditor Agreement. The Borrower agrees to pay to the Liquidity
Provider, on each Regular Distribution Date, commencing on the first
Regular Distribution Date after the making of a Provider Advance, interest
on the principal amount of any such Provider Advance as provided in Section
3.07 hereof; provided, however, that amounts in respect of a Provider
Advance withdrawn from the Class A Cash Collateral Account for the purpose
of paying interest on the Class A Certificates in accordance with Section
3.6(f) of the Intercreditor Agreement (the amount of any such withdrawal
being (y) in the case of a Downgrade Advance, an "Applied Downgrade
Advance" and (z) in the case of a Non-Extension Advance, an "Applied
Non-Extension Advance" and, together with an Applied Downgrade Advance, an
"Applied Provider Advance") shall thereafter (subject to Section 2.06(b))
be treated as an Interest Advance under this Agreement for purposes of
determining the Applicable Liquidity Rate for interest payable thereon;
provided further, however, that if, following the making of a Provider
Advance, the Liquidity Provider delivers a Termination Notice to the
Borrower pursuant to Section 6.01 hereof, such Provider Advance shall
thereafter be treated as a Final Advance under this Agreement for purposes
of determining the Applicable Liquidity Rate for interest payable thereon.
Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal
of any amounts from the Class A Cash Collateral Account on account of a
reduction in the Required Amount, the Borrower shall repay to the Liquidity
Provider a portion of the Provider Advances in a principal amount equal to
such reduction, plus interest on the principal amount prepaid as provided
in Section 3.07 hereof.
(b) At any time when an Applied Provider Advance (or any
portion thereof) is outstanding, upon the deposit in the Class A Cash
Collateral Account of any amount pursuant to clause "third" of Section
2.4(b) of the Intercreditor Agreement, clause "third" of Section 3.2 of the
Intercreditor Agreement or clause "fourth" of Section 3.3 of the
Intercreditor Agreement (any such amount being a "Replenishment Amount")
for the purpose of replenishing or increasing the balance thereof up to the
Required Amount at such time, (i) the aggregate outstanding principal
amount of all Applied Provider Advances (and of Provider Advances treated
as an Interest Advance for purposes of determining the Applicable Liquidity
Rate for interest payable thereon) shall be automatically reduced by the
amount of such Replenishment Amount and (ii) the aggregate outstanding
principal amount of all Unapplied Provider Advances shall be automatically
increased by the amount of such Replenishment Amount.
(c) Upon the provision of a Replacement Liquidity Facility
in replacement of this Agreement in accordance with Section 3.6(e) of the
Intercreditor Agreement, amounts remaining on deposit in the Class A Cash
Collateral Account after giving effect to any Applied Provider Advance on
the date of such replacement shall be reimbursed to the Liquidity Provider,
but only to the extent such amounts are necessary to repay in full to the
Liquidity Provider all amounts owing to it hereunder.
Section 2.07. Payments to the Liquidity Provider Under the
Intercreditor Agreement. In order to provide for payment or repayment to
the Liquidity Provider of any amounts hereunder, the Intercreditor
Agreement provides that amounts available and referred to in Articles II
and III of the Intercreditor Agreement, to the extent payable to the
Liquidity Provider pursuant to the terms of the Intercreditor Agreement
(including, without limitation, Section 3.6(f) of the Intercreditor
Agreement), shall be paid to the Liquidity Provider in accordance with the
terms thereof. Amounts so paid to the Liquidity Provider shall be applied
by the Liquidity Provider to Liquidity Obligations then due and payable in
accordance with the Intercreditor Agreement or, if not provided for in the
Intercreditor Agreement, then in such manner as the Liquidity Provider
shall deem appropriate.
Section 2.08. Book Entries. The Liquidity Provider shall
maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower resulting from Advances made
from time to time and the amounts of principal and interest payable
hereunder and paid from time to time in respect thereof; provided, however,
that the failure by the Liquidity Provider to maintain such account or
accounts shall not affect the obligations of the Borrower in respect of
Advances.
Section 2.09. Payments from Available Funds Only. All
payments to be made by the Borrower under this Agreement shall be made only
from the amounts that constitute Scheduled Payments, Special Payments or
payments under Section 6(c) or 6(b), as the case may be, of the
Participation Agreements and Section 7 of the Note Purchase Agreement and
only to the extent that the Borrower shall have sufficient income or
proceeds therefrom to enable the Borrower to make payments in accordance
with the terms hereof after giving effect to the priority of payments
provisions set forth in the Intercreditor Agreement. The Liquidity Provider
agrees that it will look solely to such amounts to the extent available for
distribution to it as provided in the Intercreditor Agreement and this
Agreement and that the Borrower, in its individual capacity, is not
personally liable to it for any amounts payable or liability under this
Agreement except as expressly provided in this Agreement, the Intercreditor
Agreement or any Participation Agreement. Amounts on deposit in the Class A
Cash Collateral Account shall be available to the Borrower to make payments
under this Agreement only to the extent and for the purposes expressly
contemplated in Section 3.6(f) of the Intercreditor Agreement.
Section 2.10. Extension of the Expiry Date; Non-Extension
Advance. No earlier than the 60th day and no later than the 40th day prior
to the then effective Expiry Date (unless such Expiry Date is on or after
the date that is 15 days after the Final Legal Distribution Date for the
Class A Certificates), the Borrower shall request that the Liquidity
Provider extend the Expiry Date for a period of 364 days after the then
effective Expiry Date (unless the obligations of the Liquidity Provider are
earlier terminated in accordance with the terms hereof). The Liquidity
Provider may advise the Borrower, no earlier than 40 days and no later than
25 days prior to the then effective Expiry Date that it agrees to so extend
the Expiry Date but in any event, without the necessity of any action on
the part of the Liquidity Provider the Expiry Date shall automatically be
so extended, unless the Liquidity Provider advises the Borrower on or
before the 25th day prior to the Expiry Date then in effect that such
Expiry Date shall not be so extended in which event (and if the Liquidity
Provider shall not have been replaced in accordance with Section 3.6(e) of
the Intercreditor Agreement), the Borrower shall be entitled on and after
such 25th day (but prior to the then effective Expiry Date) to request a
Non- Extension Advance in accordance with Section 2.02(b) hereof and
Section 3.6(d) of the Intercreditor Agreement.
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01. Increased Costs. The Borrower shall pay to the
Liquidity Provider from time to time such amounts as may be necessary to
compensate the Liquidity Provider for any increased costs incurred by the
Liquidity Provider which are attributable to its making or maintaining any
LIBOR Advances hereunder or its obligation to make any such Advances
hereunder, or any reduction in any amount receivable by the Liquidity
Provider under this Agreement or the Intercreditor Agreement in respect of
any such Advances or such obligation (such increases in costs and
reductions in amounts receivable being herein called "Additional Costs"),
resulting from any change after the date of this Agreement in U.S. federal,
state, municipal, or foreign laws or regulations (including Regulation D of
the Board of Governors of the Federal Reserve System), or the adoption or
making after the date of this Agreement of any interpretations, directives,
or requirements applying to a class of banks including the Liquidity
Provider under any U.S. federal, state, municipal, or any foreign laws or
regulations (whether or not having the force of law) by any court, central
bank or monetary authority charged with the interpretation or
administration thereof (a "Regulatory Change"), which: (1) changes the
basis of taxation of any amounts payable to the Liquidity Provider under
this Agreement in respect of any such Advances (other than Excluded Taxes);
or (2) imposes or modifies any reserve, special deposit, compulsory loan or
similar requirements relating to any extensions of credit or other assets
of, or any deposits with other liabilities of, the Liquidity Provider
(including any such Advances or any deposits referred to in the definition
of LIBOR Rate or related definitions). The Liquidity Provider agrees to use
reasonable efforts (consistent with applicable legal and regulatory
restrictions) to change the jurisdiction of its Facility Office if making
such change would avoid the need for, or reduce the amount of, any amount
payable under this Section that may thereafter accrue and would not, in the
reasonable judgment of the Liquidity Provider, be otherwise disadvantageous
to the Liquidity Provider.
The Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Liquidity
Provider to compensation pursuant to this Section 3.01 as promptly as
practicable after it obtains knowledge thereof and determines to request
such compensation, which notice shall describe in reasonable detail the
calculation of the amounts owed under this Section. Determinations by the
Liquidity Provider for purposes of this Section 3.01 of the effect of any
Regulatory Change on its costs of making or maintaining Advances or on
amounts receivable by it in respect of Advances, and of the additional
amounts required to compensate the Liquidity Provider in respect of any
Additional Costs, shall be prima facie evidence of the amount owed under
this Section.
Notwithstanding the preceding two paragraphs, the Liquidity
Provider and the Subordination Agent agree that the initial Liquidity
Provider (i.e., AIG Matched Funding Corp.) shall not be entitled to the
benefits of the preceding two paragraphs, provided, however, any permitted
assignee or participant of the initial Liquidity Provider which is a bank
organized under the laws of the United States or any State thereof shall be
entitled to the benefits of the preceding two paragraphs (subject, in the
case of any permitted participant, to the limitation set forth in Section
7.08 hereof).
Section 3.02. Capital Adequacy. If (1) the adoption, after
the date hereof, of any applicable governmental law, rule or regulation
regarding capital adequacy, (2) any change, after the date hereof, in the
interpretation or administration of any such law, rule or regulation by any
central bank or other governmental authority charged with the
interpretation or administration thereof or (3) compliance by the Liquidity
Provider or any corporation controlling the Liquidity Provider with any
applicable guideline or request of general applicability, issued after the
date hereof, by any central bank or other governmental authority (whether
or not having the force of law) that constitutes a change of the nature
described in clause (2), has the effect of requiring an increase in the
amount of capital required to be maintained by the Liquidity Provider or
any corporation controlling the Liquidity Provider, and such increase is
based upon the Liquidity Provider's obligations hereunder and other similar
obligations, the Borrower shall pay to the Liquidity Provider from time to
time such additional amount or amounts as are necessary to compensate the
Liquidity Provider for such portion of such increase as shall be reasonably
allocable to the Liquidity Provider's obligations to the Borrower
hereunder. The Liquidity Provider agrees to use reasonable efforts
(consistent with applicable legal and regulatory restrictions) to change
the jurisdiction of its Facility Office if making such change would avoid
the need for, or reduce the amount of, any amount payable under this
Section that may thereafter accrue and would not, in the reasonable
judgment of the Liquidity Provider, be otherwise materially disadvantageous
to the Liquidity Provider.
The Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Liquidity
Provider to compensation pursuant to this Section 3.02 as promptly as
practicable after it obtains knowledge thereof and determines to request
such compensation, which notice shall describe in reasonable detail the
calculation of the amounts owed under this Section. Determinations by the
Liquidity Provider for purposes of this Section 3.02 of the effect of any
increase in the amount of capital required to be maintained by the
Liquidity Provider and of the amount allocable to the Liquidity Provider's
obligations to the Borrower hereunder shall be prima facie evidence of the
amounts owed under this Section.
Notwithstanding the preceding two paragraphs, the Liquidity
Provider and the Subordination Agent agree that the initial Liquidity
Provider (i.e., AIG Matched Funding Corp.) shall not be entitled to the
benefits of the preceding two paragraphs, provided, however, any permitted
assignee or participant of the initial Liquidity Provider which is a bank
organized under the laws of the United States or any State thereof shall be
entitled to the benefits of the preceding two paragraphs (subject, in the
case of any permitted participant, to the limitation set forth in Section
7.08 hereof).
Section 3.03. Payments Free of Deductions. (a) All payments
made by the Borrower under this Agreement shall be made free and clear of,
and without reduction for or on account of, any present or future stamp or
other taxes, levies, imposts, duties, charges, fees, deductions,
withholdings, restrictions or conditions of any nature whatsoever now or
hereafter imposed, levied, collected, withheld or assessed, excluding
Excluded Taxes (such non-excluded taxes being referred to herein,
collectively, as "Non-Excluded Taxes" and, individually, as a "Non-Excluded
Tax"). If any Non-Excluded Taxes are required to be withheld from any
amounts payable to the Liquidity Provider under this Agreement, the amounts
so payable to the Liquidity Provider shall be increased to the extent
necessary to yield to the Liquidity Provider (after payment of all
Non-Excluded Taxes) interest or any other such amounts payable under this
Agreement at the rates or in the amounts specified in this Agreement. The
Liquidity Provider agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Facility Office if making such change would avoid the
need for, or reduce the amount of, any such additional amounts that may
thereafter accrue and would not, in the reasonable judgment of the
Liquidity Provider, be otherwise disadvantageous to the Liquidity Provider.
From time to time upon the reasonable request of the Borrower, if the
Liquidity Provider is not a corporation organized under the laws of the
United States or any State thereof, the Liquidity Provider agrees to
provide to the Borrower two original Internal Revenue Service Form W-8BEN
or W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that the Liquidity Provider is exempt
from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement.
Section 3.04. Payments. The Borrower shall make or cause to
be made each payment to the Liquidity Provider under this Agreement so as
to cause the same to be received by the Liquidity Provider not later than
1:00 p.m. (New York City time) on the day when due. The Borrower shall make
all such payments in lawful money of the United States of America, to the
Liquidity Provider in immediately available funds, by wire transfer to UBS
AG, Stamford, CT, ABA #0260-07993, Account Name: AIG Matched Funding Corp.,
Account No. WA-659-886-000, Reference: US Airways Liquidity Facility
1999-1A.
Section 3.05. Computations. All computations of interest
based on the Base Rate shall be made on the basis of a year of 365 or 366
days, as the case may be, and all computations of interest based on the
LIBOR Rate shall be made on the basis of a year of 360 days, in each case
for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest is payable.
Section 3.06. Payment on Non-Business Days. Whenever any
payment to be made hereunder shall be stated to be due on a day other than
a Business Day, such payment shall be made on the next succeeding Business
Day and no additional interest shall be due as a result (and if so made,
shall be deemed to have been made when due). If any payment in respect of
interest on an Advance is so deferred to the next succeeding Business Day,
such deferral shall not delay the commencement of the next Interest Period
for such Advance (if such Advance is a LIBOR Advance) or reduce the number
of days for which interest will be payable on such Advance on the next
interest payment date for such Advance.
Section 3.07. Interest. (a) Subject to Section 2.09, the
Borrower shall pay, or shall cause to be paid, without duplication,
interest on (i) the unpaid principal amount of each Advance from and
including the date of such Advance (or, in the case of an Applied Provider
Advance, from and including the date on which the amount thereof was
withdrawn from the Class A Cash Collateral Account to pay interest on the
Class A Certificates) to but excluding the date such principal amount shall
be paid in full (or, in the case of an Applied Provider Advance, the date
on which the Class A Cash Collateral Account is fully replenished in
respect of such Advance) and (ii) any other amount due hereunder (whether
fees, commissions, expenses or other amounts or, to the extent permitted by
law, installments of interest on Advances or any such other amount) which
is not paid when due (whether at stated maturity, by acceleration or
otherwise) from and including the due date thereof to but excluding the
date such amount is paid in full, in each such case, at a fluctuating
interest rate per annum for each day equal to the Applicable Liquidity Rate
(as defined below) for such Advance or such other amount as in effect for
such day, but in no event at a rate per annum greater than the maximum rate
permitted by applicable law; provided, however, that, if at any time the
otherwise applicable interest rate as set forth in this Section 3.07 shall
exceed the maximum rate permitted by applicable law, then any subsequent
reduction in such interest rate will not reduce the rate of interest
payable pursuant to this Section 3.07 below the maximum rate permitted by
applicable law until the total amount of interest accrued equals the amount
of interest that would have accrued if such otherwise applicable interest
rate as set forth in this Section 3.07 had at all times been in effect.
(b) Except as provided in clause (e) below, each Advance
will be either a Base Rate Advance or a LIBOR Advance as provided in this
Section. Each such Advance will be a Base Rate Advance for the period from
the date of its borrowing to (but excluding) the third Business Day
following the Liquidity Provider's receipt of the Notice of Borrowing for
such Advance. Thereafter, such Advance shall be a LIBOR Advance; provided
that the Borrower (at the direction of the Controlling Party, so long as
the Liquidity Provider is not the Controlling Party) may (x) convert the
Final Advance into a Base Rate Advance on the last day of an Interest
Period for such Advance by giving the Liquidity Provider no less than four
Business Days' prior written notice of such election or (y) elect to
maintain the Final Advance as a Base Rate Advance by not requesting a
conversion of the Final Advance to a LIBOR Advance under Clause (5) of the
applicable Notice of Borrowing (or, if such Final Advance is deemed to have
been made, without delivery of a Notice of Borrowing pursuant to Section
2.06, by requesting, prior to 11:00 a.m. on the first Business Day
immediately following the Borrower's receipt of the applicable Termination
Notice, that such Final Advance not be converted from a Base Rate Advance
to a LIBOR Advance).
(c) Each LIBOR Advance shall bear interest during each
Interest Period at a rate per annum equal to the LIBOR Rate for such
Interest Period plus the Applicable Margin for such LIBOR Advance, payable
in arrears on the last day of such Interest Period and, in the event of the
payment of principal of such LIBOR Advance on a day other than such last
day, on the date of such payment (to the extent of interest accrued on the
amount of principal repaid).
(d) Each Base Rate Advance shall bear interest at a rate per
annum equal to the Base Rate plus the Applicable Margin for such Base Rate
Advance, payable in arrears on each Regular Distribution Date and, in the
event of the payment of principal of such Base Rate Advance on a day other
than a Regular Distribution Date, on the date of such payment (to the
extent of interest accrued on the amount of principal repaid).
(e) Each outstanding Unapplied Provider Advance shall bear
interest in an amount equal to the Investment Earnings on amounts on
deposit in the Class A Cash Collateral Account plus the Applicable Margin
for such Unapplied Provider Advance on the amount of such Unapplied
Provider Advance from time to time, payable in arrears on each Regular
Distribution Date.
(f) Each amount not paid when due hereunder (whether fees,
commissions, expenses or other amounts or, to the extent permitted by
applicable law, installments of interest on Advances but excluding
Advances) shall bear interest at a rate per annum equal to the Base
Rate plus 2.00% until paid.
(g) Each change in the Base Rate shall become effective
immediately. The rates of interest specified in this Section 3.07 with
respect to any Advance or other amount shall be referred to as the
"Applicable Liquidity Rate".
Section 3.08. Replacement of Borrower. From time to time and
subject to the successor Borrower's meeting the eligibility requirements
set forth in Section 6.9 of the Intercreditor Agreement applicable to the
Subordination Agent, upon the effective date and time specified in a
written and completed Notice of Replacement Subordination Agent in
substantially the form of Annex VI attached hereto (a "Notice of
Replacement Subordination Agent") delivered to the Liquidity Provider by
the then Borrower, the successor Borrower designated therein shall be
substituted for as the Borrower for all purposes hereunder.
Section 3.09. Funding Loss Indemnification. The Borrower
shall pay to the Liquidity Provider, upon the request of the Liquidity
Provider, such amount or amounts as shall be sufficient (in the reasonable
opinion of the Liquidity Provider) to compensate it for any loss, cost, or
expense incurred by reason of the liquidation or redeployment of deposits
or other funds acquired by the Liquidity Provider to fund or maintain any
LIBOR Advance (but excluding loss of anticipated profits) incurred as a
result of:
(1) Any repayment of a LIBOR Advance or conversion of a
LIBOR Advance to a Base Rate Advance on a date other than the last day of
the Interest Period for such Advance; or
(2) Any failure by the Borrower to borrow a LIBOR Advance on
the date for borrowing specified in the relevant notice under Section 2.02.
Section 3.10. Illegality. Notwithstanding any other
provision in this Agreement, if any change in any applicable law, rule or
regulation, or any change in the interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by the
Liquidity Provider (or its Facility Office) with any request or directive
(whether or not having the force of law) of any such authority, central
bank or comparable agency shall make it unlawful or impossible for the
Liquidity Provider (or its Facility Office) to maintain or fund its LIBOR
Advances, then upon notice to the Borrower by the Liquidity Provider, the
outstanding principal amount of the LIBOR Advances shall be converted to
Base Rate Advances (a) immediately upon demand of the Liquidity Provider,
if such change or compliance with such request, in the judgment of the
Liquidity Provider, requires immediate repayment; or (b) at the expiration
of the last Interest Period to expire before the effective date of any such
change or request.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent to Effectiveness of
Section 2.01. Section 2.01 of this Agreement shall become effective on and
as of the first date (the "Effective Date") on which the following
conditions precedent have been satisfied or waived:
(a) The Liquidity Provider shall have received on or before
the Closing Date each of the following, and in the case of each document
delivered pursuant to paragraphs (i), (ii) and (iii), each in form and
substance satisfactory to the Liquidity Provider:
(i) This Agreement duly executed on behalf of the
Borrower;
(ii) The Intercreditor Agreement duly executed on behalf
of each of the parties thereto;
(iii) Fully executed copies of each of the Operative
Agreements executed and delivered on or before the
Closing Date (other than this Agreement and the
Intercreditor Agreement);
(iv) A copy of the Prospectus Supplement and specimen
copies of the Class A Certificates;
(v) An executed copy of each document, instrument,
certificate and opinion delivered on or before the
Closing Date pursuant to the Class A Trust
Agreement, the Intercreditor Agreement and the other
Operative Agreements (in the case of each such
opinion, other than the opinion of counsel for the
Underwriters, either addressed to the Liquidity
Provider or accompanied by a letter from the counsel
rendering such opinion to the effect that the
Liquidity Provider is entitled to rely on such
opinion as of its date as if it were addressed to
the Liquidity Provider);
(vi) Evidence that there shall have been made and shall
be in full force and effect, all filings, recordings
and/or registrations, and there shall have been
given or taken any notice or other similar action as
may be reasonably necessary or, to the extent
reasonably requested by the Liquidity Provider,
reasonably advisable, in order to establish,
perfect, protect and preserve the right, title and
interest, remedies, powers, privileges, liens and
security interests of, or for the benefit of, the
Trustees, the Borrower and the Liquidity Provider
created by the Operative Agreements executed and
delivered on or prior to the Closing Date;
(vii) An agreement from US Airways, pursuant to which (i) US
Airways agrees to provide copies of quarterly
financial statements and audited annual financial
statements to the Liquidity Provider, and such other
information as the Liquidity Provider shall
reasonably request with respect to the transactions
contemplated by the Operative Agreements, in each
case, only to the extent that US Airways is
obligated to provide such information pursuant to
Section 16 of the Leases (related to Leased
Aircraft) or the corresponding section of the
Indentures (related to Owned Aircraft) to the
parties thereto and (ii) US Airways agrees to allow
the Liquidity Provider to inspect US Airways' books
and records regarding such transactions, and to
discuss such transactions with officers and
employees of US Airways; and
(viii) Such other documents, instruments, opinions and
approvals pertaining to the transactions
contemplated hereby or by the other Operative
Agreements as the Liquidity Provider shall have
reasonably requested.
(b) The following statement shall be true on and as of the
Effective Date: no event has occurred and is continuing, or would result
from the entering into of this Agreement or the making of any Advance,
which constitutes a Liquidity Event of Default.
(c) The Liquidity Provider shall have received payment in
full of all fees and other sums required to be paid to or for the account
of the Liquidity Provider on or prior to the Effective Date.
(d) All conditions precedent to the issuance of the
Certificates under the Trust Agreements shall have been satisfied or
waived, all conditions precedent to the effectiveness of the other
Liquidity Facilities shall have been satisfied or waived, and all
conditions precedent to the purchase of the Class A Certificates and Class
B Certificates by the Underwriters under the Underwriting Agreement and the
purchase of the Class C Certificates by AIFS under the Class C Purchase
Agreement shall have been satisfied (unless any of such conditions
precedent shall have been waived by the Underwriters or AIFS, as the case
may be).
(e) The Borrower shall have received a certificate, dated
the date hereof, signed by a duly authorized representative of the
Liquidity Provider, certifying that all conditions precedent to the
effectiveness of Section 2.01 have been satisfied or waived.
Section 4.02. Conditions Precedent to Borrowing. The
obligation of the Liquidity Provider to make an Advance on the occasion of
each Borrowing shall be subject to the conditions precedent that the
Effective Date shall have occurred and, prior to the date of such
Borrowing, the Borrower shall have delivered a Notice of Borrowing which
conforms to the terms and conditions of this Agreement and has been
completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants of the Borrower. So long
as any Advance shall remain unpaid or the Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to
pay any amount to the Liquidity Provider hereunder, the Borrower will,
unless the Liquidity Provider shall otherwise consent in writing:
(a) Performance of This and Other Agreements. Punctually pay
or cause to be paid all amounts payable by it under this Agreement and the
other Operative Agreements and observe and perform in all material respects
the conditions, covenants and requirements applicable to it contained in
this Agreement and the other Operative Agreements.
(b) Reporting Requirements. Furnish to the Liquidity
Provider with reasonable promptness, such other information and data with
respect to the transactions contemplated by the Operative Agreements as
from time to time may be reasonably requested by the Liquidity Provider;
and permit the Liquidity Provider, upon reasonable notice, to inspect the
Borrower's books and records with respect to such transactions and to meet
with officers and employees of the Borrower to discuss such transactions.
(c) Certain Operative Agreements. Furnish to the Liquidity
Provider with reasonable promptness, such Operative Agreements entered into
after the date hereof as from time to time may be reasonably requested by
the Liquidity Provider.
Section 5.02. Negative Covenants of the Borrower. So long as
any Advance shall remain unpaid or the Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to
pay any amount to the Liquidity Provider hereunder, the Borrower will not
appoint or permit or suffer to be appointed any successor Borrower without
the prior written consent of the Liquidity Provider, which consent shall
not be unreasonably withheld or delayed.
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. Liquidity Events of Default. If (a) any
Liquidity Event of Default has occurred and is continuing and (b) there is
a Performing Note Deficiency, the Liquidity Provider may, in its
discretion, deliver to the Borrower a Termination Notice, the effect of
which shall be to cause (i) the obligation of the Liquidity Provider to
make Advances hereunder to expire on the fifth Business Day after the date
on which such Termination Notice is received by the Borrower, (ii) the
Borrower to promptly request, and the Liquidity Provider to promptly make,
a Final Advance in accordance with Section 2.02(d) hereof and Section
3.6(i) of the Intercreditor Agreement, (iii) all other outstanding Advances
to be automatically converted into Final Advances for purposes of
determining the Applicable Liquidity Rate for interest payable thereon, and
(iv) subject to Sections 2.07 and 2.09 hereof, all Advances (including,
without limitation, any Provider Advance and Applied Provider Advance), any
accrued interest thereon and any other amounts outstanding hereunder to
become immediately due and payable to the Liquidity Provider.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Liquidity Provider, and, in the case of an
amendment or of a waiver by the Borrower, the Borrower, and then such
waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
Section 7.02. Notices, Etc. Except as otherwise expressly
provided herein, all notices and other communications provided for
hereunder shall be in writing (including telecopier and mailed or delivered
or sent by telecopier):
Borrower: STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
225 Asylum Street
Goodwyn Square
Hartford, CT 06103
Attention: Corporate/Muni. Department
Telephone: (860) 244-1822
Telecopy: (860) 244-1889
with a copy to:
State Street Bank and Trust Company.
Corporate Trust Department
2 International Place, 4th Floor
Boston, MA 02110
Attention: Ruth A. Smith
Telecopy: (617) 664-5151
Liquidity Provider: AIG MATCHED FUNDING CORP.
100 Nyala Farm
Westport, CT 06880
Attention: Chief Financial Officer
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
with a copy to:
The General Counsel
AIG Matched Funding Corp.
100 Nyala Farm
Westport, CT 06880
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
or, as to each of the foregoing, at such other address as shall be
designated by such Person in a written notice to the others. All such
notices and communications shall be effective (i) if given by telecopier,
when transmitted to the telecopier number specified above and (ii) if given
by other means, when delivered at the address specified above, except that
written notices to the Liquidity Provider pursuant to the provisions of
Articles II and III hereof shall not be effective until received by the
Liquidity Provider. A copy of all notices delivered hereunder to either
party shall in addition be delivered to each of the parties to the
Participation Agreements at their respective addresses set forth therein.
Section 7.03. No Waiver; Remedies. No failure on the part of
the Liquidity Provider to exercise, and no delay in exercising, any right
under this Agreement shall operate as a waiver thereof; nor shall any
single or partial exercise of any right under this Agreement preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
Section 7.04. Further Assurances. The Borrower agrees to do
such further acts and things and to execute and deliver to the Liquidity
Provider such additional assignments, agreements, powers and instruments as
the Liquidity Provider may reasonably require or deem advisable to carry
into effect the purposes of this Agreement and the other Operative
Agreements or to better assure and confirm unto the Liquidity Provider its
rights, powers and remedies hereunder and under the other Operative
Agreements.
Section 7.05. Indemnification; Survival of Certain
Provisions. The Liquidity Provider shall be indemnified hereunder to the
extent and in the manner described in Section 6(c) or 6(b), as the case may
be, of the Participation Agreements. In addition, the Borrower agrees to
indemnify, protect, defend and hold harmless the Liquidity Provider from,
against and in respect of, and shall pay on demand, all Expenses of any
kind or nature whatsoever (other than any Expenses of the nature described
in Section 3.01, 3.02 or 7.07 hereof or in the Fee Letter (regardless of
whether indemnified against pursuant to said Sections or in such Fee
Letter)), that may be imposed, incurred by or asserted against any
Liquidity Indemnitee, in any way relating to, resulting from, or arising
out of or in connection with any action, suit or proceeding by any third
party against such Liquidity Indemnitee and relating to this Agreement, the
Fee Letter, the Intercreditor Agreement or any Financing Agreement;
provided, however, that the Borrower shall not be required to indemnify,
protect, defend and hold harmless any Liquidity Indemnitee in respect of
any Expense of such Liquidity Indemnitee to the extent such Expense is (i)
attributable to the gross negligence or willful misconduct of such
Liquidity Indemnitee or any other Liquidity Indemnitee, (ii) ordinary and
usual operating overhead expense, or (iii) attributable to the failure by
such Liquidity Indemnitee or any other Liquidity Indemnitee to perform or
observe any agreement, covenant or condition on its part to be performed or
observed in this Agreement, the Intercreditor Agreement, the Fee Letter or
any other Operative Agreement to which it is a party. The indemnities
contained in Section 6(c) or 6(b), as the case may be, of the Participation
Agreements, and the provisions of Sections 3.01, 3.02, 3.03, 3.09, 7.05 and
7.07 hereof, shall survive the termination of this Agreement.
Section 7.06. Liability of the Liquidity Provider. (a)
Neither the Liquidity Provider nor any of its officers, employees,
directors or Affiliates shall be liable or responsible for: (i) the use
which may be made of the Advances or any acts or omissions of the Borrower
or any beneficiary or transferee in connection therewith; (ii) the
validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; or (iii) the making of
Advances by the Liquidity Provider against delivery of a Notice of
Borrowing and other documents which do not comply with the terms hereof;
provided, however, that the Borrower shall have a claim against the
Liquidity Provider, and the Liquidity Provider shall be liable to the
Borrower, to the extent of any damages suffered by the Borrower which were
the result of (A) the Liquidity Provider's willful misconduct or negligence
in determining whether documents presented hereunder comply with the terms
hereof, or (B) any breach by the Liquidity Provider of any of the terms of
this Agreement, including, but not limited to, the Liquidity Provider's
failure to make lawful payment hereunder after the delivery to it by the
Borrower of a Notice of Borrowing strictly complying with the terms and
conditions hereof.
(b) Neither the Liquidity Provider nor any of its officers,
employees, directors or Affiliates shall be liable or responsible in any
respect for (i) any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with this Agreement or any Notice of Borrowing delivered
hereunder, or (ii) any action, inaction or omission which may be taken by
it in good faith, absent willful misconduct or negligence (in which event
the extent of the Liquidity Provider's potential liability to the Borrower
shall be limited as set forth in the immediately preceding paragraph), in
connection with this Agreement or any Notice of Borrowing.
Section 7.07. Costs, Expenses and Taxes. The Borrower agrees
to pay, or cause to be paid (A) on the Effective Date and on such later
date or dates on which the Liquidity Provider shall make demand, all
reasonable out-of-pocket costs and expenses (including, without limitation,
the reasonable fees and expenses of outside counsel for the Liquidity
Provider) of the Liquidity Provider in connection with the preparation,
negotiation, execution, delivery, filing and recording of this Agreement,
any other Operative Agreement and any other documents which may be
delivered in connection with this Agreement and (B) on demand, all
reasonable costs and expenses (including reasonable counsel fees and
expenses) of the Liquidity Provider in connection with (i) the enforcement
of this Agreement or any other Operative Agreement, (ii) the modification
or amendment of, or supplement to, this Agreement or any other Operative
Agreement or such other documents which may be delivered in connection
herewith or therewith (whether or not the same shall become effective) or
(iii) any action or proceeding relating to any order, injunction, or other
process or decree restraining or seeking to restrain the Liquidity Provider
from paying any amount under this Agreement, the Intercreditor Agreement or
any other Operative Agreement or otherwise affecting the application of
funds in the Class A Cash Collateral Account. In addition, the Borrower
shall pay any and all recording, stamp and other similar taxes and fees
payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, any other Operative
Agreement and such other documents, and agrees to save the Liquidity
Provider harmless from and against any and all liabilities with respect to
or resulting from any delay in paying or omission to pay such taxes or
fees.
Section 7.08. Binding Effect; Participations. (a) This
Agreement shall be binding upon and inure to the benefit of the Borrower
and the Liquidity Provider and their respective successors and assigns,
except that neither the Liquidity Provider (except as otherwise provided in
this Section 7.08) nor (except as contemplated by Section 3.08) the
Borrower shall have the right to assign its rights or obligations hereunder
or any interest herein without the prior written consent of the other
party, subject to the requirements of Section 7.08(b). The Liquidity
Provider may grant participations herein or in any of its rights hereunder
(including, without limitation, funded participations and participations in
rights to receive interest payments hereunder) and under the other
Operative Agreements to such Persons (other than US Airways or any of its
affiliates) as the Liquidity Provider may in its sole discretion select,
subject to the requirements of Section 7.08(b). No such participation by
the Liquidity Provider, however, will relieve the Liquidity Provider of its
obligations hereunder. In connection with any participation or any proposed
participation, the Liquidity Provider may disclose to the participant or
the proposed participant any information that the Borrower is required to
deliver or to disclose to the Liquidity Provider pursuant to this
Agreement. The Borrower acknowledges and agrees that the Liquidity
Provider's source of funds may derive in part from its participants.
Accordingly, references in this Agreement and the other Operative
Agreements to determinations, reserve and capital adequacy requirements,
increased costs, reduced receipts, additional amounts due pursuant to
Section 3.03(a) and the like as they pertain to the Liquidity Provider
shall be deemed also to include those of each of its participants that are
banks (subject, in each case, if any such participant is not a bank that is
(i) organized under the laws of the United States or any State thereof and
(ii) a member bank of the Federal Reserve System with deposits exceeding
$1,000,000,000 (such a bank, a "Reference Bank"), to the maximum amount
that would have been directly incurred by any Reference Bank organized
under the laws of the United States or any State thereof if such Reference
Bank, rather than the participant, had held the interest participated).
(b) If, pursuant to subsection (a) above, the Liquidity
Provider sells any participation in this Agreement to any bank or other
entity (each, a "Transferee"), then, concurrently with the effectiveness of
such participation, the Transferee shall (i) represent to the Liquidity
Provider (for the benefit of the Liquidity Provider and the Borrower)
either (A) that it is incorporated under the laws of the United States or a
state thereof or (B) that under applicable law and treaties, no taxes will
be required to be withheld with respect to any payments to be made to such
Transferee in respect of this Agreement, (ii) furnish to the Liquidity
Provider and the Borrower either (x) a statement that it is incorporated
under the laws of the United States or a state thereof or (y) if it is not
so incorporated, two copies of a properly completed United States Internal
Revenue Service Form W-8ECI or Form W-8BEN, as appropriate, or other
applicable form, certificate or document prescribed by the Internal Revenue
Service certifying, in each case, such Transferee's entitlement to a
complete exemption from United States federal withholding tax in respect to
any and all payments to be made hereunder, and (iii) agree (for the benefit
of the Liquidity Provider and the Borrower) to provide the Liquidity
Provider and the Borrower a new Form W-8ECI or Form W-8BEN, as appropriate,
(A) on or before the date that any such form expires or becomes obsolete or
(B) after the occurrence of any event requiring a change in the most recent
form previously delivered by it and prior to the immediately following due
date of any payment by the Borrower hereunder, certifying in the case of a
Form W-8BEN or Form W- 8ECI that such Transferee is entitled to a complete
exemption from United States federal withholding tax on payments under this
Agreement. Unless the Borrower has received forms or other documents
reasonably satisfactory to it (and required by applicable law) indicating
that payments hereunder are not subject to United States federal
withholding tax, the Borrower will withhold taxes as required by law from
such payments at the applicable statutory rate.
(c) Notwithstanding the other provisions of this Section
7.08, the Liquidity Provider may assign and pledge all or any portion of
the Advances owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued
by such Federal Reserve Bank, provided that any payment in respect of such
assigned Advances made by the Borrower to the Liquidity Provider in
accordance with the terms of this Agreement shall satisfy the Borrower's
obligations hereunder in respect of such assigned Advance to the extent of
such payment. No such assignment shall release the Liquidity Provider from
its obligations hereunder.
Section 7.09. Severability. Any provision of this Agreement
which is prohibited, unenforceable or not authorized in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition, unenforceability or non-authorization without invalidating the
remaining provisions hereof or affecting the validity, enforceability or
legality of such provision in any other jurisdiction.
Section 7.10. GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK.
Section 7.11. Submission to Jurisdiction; Waiver of Jury
Trial; Waiver of Immunity.
(a) Each of the parties hereto hereby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal
action or proceeding relating to this Agreement or
any other Operative Agreement, or for recognition
and enforcement of any judgment in respect hereof or
thereof, to the nonexclusive general jurisdiction of
the courts of the State of New York, the courts of
the United States of America for the Southern
District of New York, and the appellate courts from
any thereof;
(ii) consents that any such action or proceeding may be
brought in such courts, and waives any objection
that it may now or hereafter have to the venue of
any such action or proceeding in any such court or
that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim
the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof
by registered or certified mail (or any
substantially similar form of mail), postage
prepaid, to each party hereto at its address set
forth in Section 7.02 hereof, or at such other
address of which the Liquidity Provider shall have
been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner
permitted by law or shall limit the right to sue in
any other jurisdiction.
(b) THE BORROWER AND THE LIQUIDITY PROVIDER EACH HEREBY
AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE
RELATIONSHIP THAT IS BEING ESTABLISHED, including, without limitation,
contract claims, tort claims, breach of duty claims and all other common
law and statutory claims. The Borrower and the Liquidity Provider each
warrant and represent that it has reviewed this waiver with its legal
counsel, and that it knowingly and voluntarily waives its jury trial rights
following consultation with such legal counsel. THIS WAIVER IS IRREVOCABLE,
AND CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS AGREEMENT.
(c) The Liquidity Provider hereby waives any immunity it may
have from the jurisdiction of the courts of the United States or of any
State and waives any immunity any of its properties located in the United
States may have from attachment or execution upon a judgment entered by any
such court under the United States Foreign Sovereign Immunities Act of 1976
or any similar successor legislation.
Section 7.12. Execution in Counterparts. This Agreement may
be executed in any number of counterparts and by different parties hereto
on separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
Section 7.13. Entirety. This Agreement, the Intercreditor
Agreement and the other Operative Agreements to which the Liquidity
Provider is a party constitute the entire agreement of the parties hereto
with respect to the subject matter hereof and supersedes all prior
understandings and agreements of such parties.
Section 7.14. Headings. Section headings in this Agreement
are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE
ADVANCES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OBLIGATIONS
OF THE LIQUIDITY PROVIDER TO MAKE ADVANCES HEREUNDER, AND THE BORROWER'S
RIGHTS TO DELIVER NOTICES OF BORROWING REQUESTING THE MAKING OF ADVANCES
HEREUNDER, SHALL BE UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR
PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed and delivered by their respective officers thereunto
duly authorized as of the date first set forth above.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely as
Subordination Agent, as agent and trustee
for the Class A Trust, as Borrower
By:/s/ Julie A. Balerna
___________________________________
Name: Julie A. Balerna
Title:Assistant Vice President
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
By:/s/ Colum Carr
___________________________________
Name: Colum Carr
Title:Vice President
Annex I to Revolving Credit Agreement
INTEREST ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1A) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of an Interest Advance by the Liquidity Provider to be
used, subject to clause (3)(v) below, for the payment of the
interest on the Class A Certificates which was payable on
____________, ____ (the "Distribution Date") in accordance with the
terms and provisions of the Class A Trust Agreement and the Class A
Certificates, which Advance is requested to be made on
____________, ____.
(3) The amount of the Interest Advance requested hereby (i)
is $_______________.__, to be applied in respect of the payment of
the interest which was due and payable on the Class A Certificates
on the Distribution Date, (ii) does not include any amount with
respect to the payment of principal of, or premium on, the Class A
Certificates, the Class B Certificates or the Class C Certificates,
or interest on the Class B Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class A Certificates, the Class A Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), (iv) does not exceed the Maximum Available
Commitment on the date hereof, (v) does not include any amount of
interest which was due and payable on the Class A Certificates on
such Distribution Date but which remains unpaid due to the failure
of the Depositary to pay any amount of accrued interest on the
Deposits on such Distribution Date and (vi) has not been and is not
the subject of a prior or contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will apply the same in
accordance with the terms of Section 3.6(b) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, the making of the Interest Advance as requested by
this Notice of Borrowing shall automatically reduce, subject to
reinstatement in accordance with the terms of the Liquidity Agreement, the
Maximum Available Commitment by an amount equal to the amount of the
Interest Advance requested to be made hereby as set forth in clause (i) of
paragraph (3) of this Certificate and such reduction shall automatically
result in corresponding reductions in the amounts available to be borrowed
pursuant to a subsequent Advance.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with Interest Advance Notice
of Borrowing]
Annex II to
Revolving Credit Agreement
NON-EXTENSION ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1A) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of the Non-Extension Advance by the Liquidity Provider
to be used for the funding of the Class A Cash Collateral Account
in accordance with Section 3.6(d) of the Intercreditor Agreement,
which Advance is requested to be made on __________, ____.
(3) The amount of the Non-Extension Advance requested hereby
(i) is $_______________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of
the funding of the Class A Cash Collateral Account in accordance
with Section 3.6(d) of the Intercreditor Agreement, (ii) does not
include any amount with respect to the payment of the principal of,
or premium on, the Class A Certificates, or principal of, or
interest or premium on, the Class B Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class A Certificates, the Class A Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), and (iv) has not been and is not the subject
of a prior or contemporaneous Notice of Borrowing under the
Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will deposit such amount
in the Class A Cash Collateral Account and apply the same in
accordance with the terms of Section 3.6(d) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice]1.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Non-Extension Advance as
requested by this Notice of Borrowing shall automatically and irrevocably
terminate the obligation of the Liquidity Provider to make further Advances
under the Liquidity Agreement; and (B) following the making by the
Liquidity Provider of the Non-Extension Advance requested by this Notice of
Borrowing, the Borrower shall not be entitled to request any further
Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
- -------------------
1 Bracketed language may be included at Borrower's option.
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with Non-Extension Advance Notice
of Borrowing]
Annex III to
Revolving Credit Agreement
DOWNGRADE ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1A) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of the Downgrade Advance by the Liquidity Provider to be
used for the funding of the Class A Cash Collateral Account in
accordance with Section 3.6(c) of the Intercreditor Agreement by
reason of the downgrading of the short-term unsecured debt rating
of the Liquidity Provider issued by either Rating Agency below the
Threshold Rating, which Advance is requested to be made on
__________, ____.
(3) The amount of the Downgrade Advance requested hereby (i)
is $_______________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of
the funding of the Class A Cash Collateral Account in accordance
with Section 3.6(c) of the Intercreditor Agreement, (ii) does not
include any amount with respect to the payment of the principal of,
or premium on, the Class A Certificates, or principal of, or
interest or premium on, the Class B Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class A Certificates, the Class A Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), and (iv) has not been and is not the subject
of a prior or contemporaneous Notice of Borrowing under the
Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will deposit such amount
in the Class A Cash Collateral Account and apply the same in
accordance with the terms of Section 3.6(c) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice]2.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Downgrade Advance as requested
by this Notice of Borrowing shall automatically and irrevocably terminate
the obligation of the Liquidity Provider to make further Advances under the
Liquidity Agreement; and (B) following the making by the Liquidity Provider
of the Downgrade Advance requested by this Notice of Borrowing, the
Borrower shall not be entitled to request any further Advances under the
Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
- -------------------
2 Bracketed language may be included at Borrower's option.
SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with Downgrade Advance Notice
of Borrowing]
Annex IV to
Revolving Credit Agreement
FINAL ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1A) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of the Final Advance by the Liquidity Provider to be
used for the funding of the Class A Cash Collateral Account in
accordance with Section 3.6(i) of the Intercreditor Agreement by
reason of the receipt by the Borrower of a Termination Notice from
the Liquidity Provider with respect to the Liquidity Agreement,
which Advance is requested to be made on ____________, ____.
(3) The amount of the Final Advance requested hereby (i) is
$_________________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of
the funding of the Class A Cash Collateral Account in accordance
with Section 3.6(i) of the Intercreditor Agreement, (ii) does not
include any amount with respect to the payment of principal of, or
premium on, the Class A Certificates, or principal of, or interest
or premium on, the Class B Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class A Certificates, the Class A Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), and (iv) has not been and is not the subject
of a prior or contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will deposit such amount
in the Class A Cash Collateral Account and apply the same in
accordance with the terms of Section 3.6(i) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice]3.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Final Advance as requested by
this Notice of Borrowing shall automatically and irrevocably terminate the
obligation of the Liquidity Provider to make further Advances under the
Liquidity Agreement; and (B) following the making by the Liquidity Provider
of the Final Advance requested by this Notice of Borrowing, the Borrower
shall not be entitled to request any further Advances under the Liquidity
Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
- -------------------
3 Bracketed language may be included at Borrower's option.
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with Final Advance Notice
of Borrowing]
Annex V to
Revolving Credit Agreement
NOTICE OF TERMINATION
[Date]
State Street Bank and Trust Company of Connecticut,
National Association,
as Subordination Agent, as Borrower
225 Asylum Street
Goodwyn Square
Hartford, CT 06103
Attention: Corporate Trust Administration
Revolving Credit Agreement dated as of August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, as agent and
trustee for the US Airways Pass Through Trust, 1999-1A, as
Borrower, and AIG MATCHED FUNDING CORP. (the "Liquidity
Agreement")
Ladies and Gentlemen:
You are hereby notified that pursuant to Section 6.01 of the
Liquidity Agreement, by reason of the occurrence of a Liquidity Event of
Default and the existence of a Performing Note Deficiency (each as defined
therein), we are giving this notice to you in order to cause (i) our
obligations to make Advances (as defined therein) under such Liquidity
Agreement to terminate on the fifth Business Day after the date on which
you receive this notice and (ii) you to request a Final Advance under the
Liquidity Agreement pursuant to Section 3.6(i) of the Intercreditor
Agreement (as defined in the Liquidity Agreement) as a consequence of your
receipt of this notice.
THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR
UNDER THE LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE
LIQUIDITY AGREEMENT WILL TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE
ON WHICH YOU RECEIVE THIS NOTICE.
Very truly yours,
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
By:_______________________________
Name:
Title:
cc: State Street Bank and Trust Company of Connecticut, National Association,
as Class A Trustee
Annex VI to
Revolving Credit Agreement
NOTICE OF REPLACEMENT SUBORDINATION AGENT
[Date]
Attention:
Revolving Credit Agreement dated as of August 31, 1999, between
State Street Bank and Trust Company of Connecticut, National
Association, as Subordination Agent, as agent and trustee for the
US Airways Pass Through Trust, 1999-1A, as Borrower, and AIG
MATCHED FUNDING CORP. (the "Liquidity Agreement")
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby irrevocably
transfers to:
------------------------------
[Name of Transferee]
------------------------------
[Address of Transferee]
all rights and obligations of the undersigned as Borrower under the
Liquidity Agreement referred to above. The transferee has succeeded the
undersigned as Subordination Agent under the Intercreditor Agreement
referred to in the first paragraph of the Liquidity Agreement, pursuant to
the terms of Section 8.1 of the Intercreditor Agreement.
By this transfer, all rights of the undersigned as Borrower
under the Liquidity Agreement are transferred to the transferee and the
transferee shall hereafter have the sole rights and obligations as Borrower
thereunder. The undersigned shall pay any costs and expenses of such
transfer, including, but not limited to, transfer taxes or governmental
charges.
We ask that this transfer be effective as of
_______________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
By:___________________________________
Name:
Title:
Exhibit 4(a)(vii)
[GRAPHIC OMITTED]
-----------------------------------------------------------------
REVOLVING CREDIT AGREEMENT
(1999-1B)
Dated as of August 31, 1999
between
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Subordination Agent,
as agent and trustee for the
US Airways Pass Through Trust 1999-1B
as Borrower
and
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
-----------------------------------------------------------------
Relating to
US Airways Pass Through Trust 1999-1B
9.01% US Airways Pass Through Certificates,
Series 1999-1B
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
ARTICLE I DEFINITIONS...................................................................1
Section 1.01. Certain Defined Terms..................................................1
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT...........................................6
Section 2.01. The Advances...........................................................6
Section 2.02. Making the Advances....................................................7
Section 2.03. Fees...................................................................9
Section 2.04. Reductions or Termination of the Maximum Commitment....................9
Section 2.05. Repayments of Interest Advances or the Final Advance...................9
Section 2.06. Repayments of Provider Advances........................................9
Section 2.07. Payments to the Liquidity Provider Under the Intercreditor Agreement..10
Section 2.08. Book Entries..........................................................11
Section 2.09. Payments from Available Funds Only....................................11
Section 2.10. Extension of the Expiry Date; Non-Extension Advance...................11
ARTICLE III OBLIGATIONS OF THE BORROWER................................................12
Section 3.01. Increased Costs.......................................................12
Section 3.02. Capital Adequacy......................................................13
Section 3.03. Payments Free of Deductions...........................................14
Section 3.04. Payments..............................................................14
Section 3.05. Computations..........................................................14
Section 3.06. Payment on Non-Business Days..........................................14
Section 3.07. Interest..............................................................15
Section 3.08. Replacement of Borrower...............................................16
Section 3.09. Funding Loss Indemnification..........................................16
Section 3.10. Illegality............................................................17
ARTICLE IV CONDITIONS PRECEDENT........................................................17
Section 4.01. Conditions Precedent to Effectiveness of Section 2.01.................17
Section 4.02. Conditions Precedent to Borrowing.....................................19
ARTICLE V COVENANTS....................................................................19
Section 5.01. Affirmative Covenants of the Borrower.................................19
Section 5.02. Negative Covenants of the Borrower....................................20
ARTICLE VI LIQUIDITY EVENTS OF DEFAULT.................................................20
Section 6.01. Liquidity Events of Default...........................................20
ARTICLE VII MISCELLANEOUS..............................................................20
Section 7.01. Amendments, Etc.......................................................20
Section 7.02. Notices, Etc..........................................................21
Section 7.03. No Waiver; Remedies...................................................22
Section 7.04. Further Assurances....................................................22
Section 7.05. Indemnification; Survival of Certain Provisions.......................22
Section 7.06. Liability of the Liquidity Provider...................................23
Section 7.07. Costs, Expenses and Taxes.............................................23
Section 7.08. Binding Effect; Participations........................................24
Section 7.09. Severability..........................................................25
Section 7.10. GOVERNING LAW.........................................................25
Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity..25
Section 7.12. Execution in Counterparts.............................................26
Section 7.13. Entirety..............................................................26
Section 7.14. Headings..............................................................27
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES......................27
</TABLE>
ANNEX I Interest Advance Notice of Borrowing
ANNEX II Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV Final Advance Notice of Borrowing
ANNEX V Notice of Termination
ANNEX VI Notice of Replacement Subordination Agent
REVOLVING CREDIT AGREEMENT (1999-1A)
This REVOLVING CREDIT AGREEMENT (1999-1B) dated as of
August 31, 1999, between STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, a national banking association, not
in its individual capacity but solely as Subordination Agent under the
Intercreditor Agreement (each as defined below), as agent and trustee
for the Class B Trust (as defined below) (the "Borrower"), and AIG
MATCHED FUNDING CORP., a corporation organized under the laws of the
State of Delaware (the "Liquidity Provider").
W I T N E S S E T H:
WHEREAS, pursuant to the Class B Trust Agreement (such
term and all other capitalized terms used in these recitals having the
meanings set forth or referred to in Section 1.01), the Class B Trust
is issuing the Class B Certificates; and
WHEREAS, the Borrower, in order to support the timely
payment of a portion of the interest on the Class B Certificates in
accordance with their terms, has requested the Liquidity Provider to
enter into this Agreement, providing in part for the Borrower to
request in specified circumstances that Advances be made hereunder.
NOW, THEREFORE, in consideration of the premises, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms. (a) Definitions. As
used in this Agreement and unless otherwise expressly indicated, or unless
the context clearly requires otherwise, the following capitalized terms
shall have the following respective meanings for all purposes of this
Agreement:
"Additional Cost" has the meaning assigned to such term in
Section 3.01.
"Advance" means an Interest Advance, a Final Advance, a
Provider Advance, an Applied Provider Advance or an Unpaid Advance, as the
case may be.
"Applicable Liquidity Rate" has the meaning assigned to such
term in Section 3.07(g).
"Applicable Margin" means (x) with respect to any Unpaid
Advance or Applied Provider Advance, 1.75%, (y) with respect to any
Unapplied Provider Advance, the rate per annum specified in the Fee Letter.
"Applied Downgrade Advance" has the meaning assigned to such
term in Section 2.06(a).
"Applied Non-Extension Advance" has the meaning assigned to
such term in Section 2.06(a).
"Applied Provider Advance" has the meaning assigned to such
term in Section 2.06(a).
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be equal
to (a) the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by the Liquidity Provider from three Federal funds
brokers of recognized standing selected by it, plus (b) one quarter of one
percent (1/4 of 1%) per annum.
"Base Rate Advance" means an Advance that bears interest at
a rate based upon the Base Rate.
"Borrower" has the meaning assigned to such term in the
recital of parties to this Agreement.
"Borrowing" means the making of Advances requested by
delivery of a Notice of Borrowing.
"Business Day" means any day other than a Saturday or Sunday
or a day on which commercial banks are required or authorized to close in
New York, New York, Pittsburgh, Pennsylvania, or, so long as any Class B
Certificate is outstanding, the city and state in which the Class B
Trustee, the Borrower or any Loan Trustee maintains its Corporate Trust
Office or receives or disburses funds, and, if the applicable Business Day
relates to any Advance or other amount bearing interest based on the LIBOR
Rate, on which dealings are carried on in the London interbank market.
"Deposits" has the meaning assigned to such terms in the
Deposit Agreement.
"Depositary" has the meaning assigned to such term in the
Deposit Agreement.
"Deposit Agreement" means the Deposit Agreement dated as of
the date hereof between First Security Bank, National Association, as
Escrow Agent and ABN AMRO Bank, N.V., acting through its Chicago branch, as
Depositary, pertaining to the Class B Certificates, as the same may be
amended, modified or supplemented from time to time in accordance with the
terms thereof.
"Downgrade Advance" means an Advance made pursuant to
Section 2.02(c).
"Effective Date" has the meaning specified in Section 4.01.
The delivery of the certificate of the Liquidity Provider contemplated by
Section 4.01(e) shall be conclusive evidence that the Effective Date has
occurred.
"Excluded Taxes" means (i) taxes imposed on the overall net
income of the Liquidity Provider or of its Facility Office by the
jurisdiction where such Liquidity Provider's principal office or such
Facility Office is located, and (ii) Excluded Withholding Taxes.
"Excluded Withholding Taxes" means (i) withholding Taxes
imposed by the United States except to the extent that such United States
withholding Taxes are imposed as a result of any change in applicable law
(excluding from change in applicable law for this purpose a change in an
applicable treaty or other change in law affecting the applicability of a
treaty) after the date hereof, or in the case of a successor Liquidity
Provider (including a transferee of an Advance) or Facility Office, after
the date on which such successor Liquidity Provider obtains its interest or
on which the Facility Office is changed, and (ii) any withholding Taxes
imposed by the United States which are imposed or increased as a result of
the Liquidity Provider failing to deliver to the Borrower any certificate
or document (which certificate or document in the good faith judgment of
the Liquidity Provider it is legally entitled to provide) which is
reasonably requested by the Borrower to establish that payments under this
Agreement are exempt from (or entitled to a reduced rate of) withholding
Tax.
"Expenses" means liabilities, obligations, damages,
settlements, penalties, claims, actions, suits, costs, expenses, and
disbursements (including, without limitation, reasonable fees and
disbursements of legal counsel and costs of investigation), provided that
Expenses shall not include any Taxes.
"Expiry Date" means August 28, 2000, initially, or any date
to which the Expiry Date is extended pursuant to Section 2.10.
"Facility Office" means the Facility Office of the Liquidity
Provider presently located at Westport, Connecticut, or such other Facility
Office as the Liquidity Provider from time to time shall notify the
Borrower as its Facility Office hereunder; provided that the Liquidity
Provider shall not change its Facility Office to a Facility Office outside
the United States of America except in accordance with Section 3.01, 3.02
or 3.03 hereof.
"Final Advance" means an Advance made pursuant to Section
2.02(d).
"Intercreditor Agreement" means the Intercreditor Agreement
dated the date hereof, among the Trustees, the Liquidity Provider, the
liquidity provider under each Liquidity Facility (other than this
Agreement) and the Subordination Agent, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Interest Advance" means an Advance made pursuant to Section
2.02(a).
"Interest Period" means, with respect to any LIBOR Advance,
each of the following periods:
(i) the period beginning on the third Business Day
following either (x) the Liquidity Provider's
receipt of the Notice of Borrowing for such LIBOR
Advance or (y) the date of the withdrawal of
funds from the Class B Cash Collateral Account
for the purpose of paying interest on the Class B
Certificates as contemplated by Section 2.06(a)
hereof and, in either case, ending on the next
Regular Distribution Date; and
(ii) each subsequent period commencing on the last day
of the immediately preceding Interest Period and
ending on the next Regular Distribution Date;
provided, however, that if (x) the Final Advance shall have been made, or
(y) other outstanding Advances shall have been converted into the Final
Advance, then the Interest Periods shall be successive periods of one month
beginning on the third Business Day following the Liquidity Provider's
receipt of the Notice of Borrowing for such Final Advance (in the case of
clause (x) above) or the Regular Distribution Date following such
conversion (in the case of clause (y) above).
"LIBOR Advance" means an Advance bearing interest at a
rate based upon the LIBOR Rate.
"LIBOR Rate" means, with respect to any Interest Period:
(i) the rate per annum appearing on display page 3750
(British Bankers Association-LIBOR) of the Dow
Jones Markets Service (or any successor or
substitute therefor ) at approximately 11:00 A.M.
(London time) two Business Days before the first
day of such Interest Period, as the rate for
dollar deposits with a maturity comparable to
such Interest Period, or
(ii) if the rate calculated pursuant to clause (i)
above is not available, the average (rounded
upwards, if necessary, to the next 1/16 of 1%) of
the rates per annum at which deposits in dollars
are offered for the relevant Interest Period by
three banks of recognized standing selected by
the Liquidity Provider in the London interbank
market at approximately 11:00 A.M. (London time)
two Business Days before the first day of such
Interest Period in an amount approximately equal
to the principal amount of the LIBOR Advance to
which such Interest Period is to apply and for a
period comparable to such Interest Period.
"Liquidity Event of Default" means the occurrence of either
(a) the Acceleration of all of the Equipment Notes (provided that, with
respect to the period prior to the Delivery Period Expiry Date, such
Equipment Notes have an aggregate outstanding principal balance in excess
of $300,000,000) or (b) a US Airways Bankruptcy Event.
"Liquidity Indemnitee" means (i) the Liquidity Provider,
(ii) the directors, officers, employees and agents of the Liquidity
Provider, and (iii) the successors and permitted assigns of the persons
described in clauses (i) and (ii), inclusive.
"Liquidity Provider" has the meaning assigned to such term
in the recital of parties to this Agreement.
"Maximum Available Commitment" shall mean, subject to the
proviso contained in the third sentence of Section 2.02(a), at any time of
determination, (a) the Maximum Commitment at such time less (b) the
aggregate amount of each Interest Advance outstanding at such time;
provided that following a Provider Advance or a Final Advance, the Maximum
Available Commitment shall be zero.
"Maximum Commitment" means initially $11,269,347.60, as the
same may be reduced from time to time in accordance with Section 2.04(a).
"Non-Excluded Tax" has the meaning specified in Section
3.03.
"Non-Extension Advance" means an Advance made pursuant to
Section 2.02(b).
"Notice of Borrowing" has the meaning specified in Section
2.02(e).
"Notice of Replacement Subordination Agent" has the meaning
specified in Section 3.08.
"Performing Note Deficiency" means any time that less than
65% of the then aggregate outstanding principal amount of all Equipment
Notes are Performing Equipment Notes.
"Prospectus Supplement" means the Prospectus Supplement
dated August 24, 1999 relating to the Class A Certificates and the Class B
Certificates, as such Prospectus Supplement may be amended or supplemented.
"Provider Advance" means a Downgrade Advance or a
Non-Extension Advance.
"Regulatory Change" has the meaning assigned to such term in
Section 3.01.
"Replenishment Amount" has the meaning assigned to such term
in Section 2.06(b).
"Required Amount" means, for any day, the sum of the
aggregate amount of interest, calculated at the rate per annum equal to the
Stated Interest Rate for the Class B Certificates, that would be payable on
the Class B Certificates on each of the three successive semiannual Regular
Distribution Dates immediately following such day or, if such day is a
Regular Distribution Date, on such day and the succeeding two semiannual
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of the Class B Certificates on such day and without regard to
expected future payments of principal on the Class B Certificates.
"Termination Date" means the earliest to occur of the
following: (i) the Expiry Date; (ii) the date on which the Borrower
delivers to the Liquidity Provider a certificate, signed by a Responsible
Officer of the Borrower, certifying that all of the Class B Certificates
have been paid in full (or provision has been made for such payment in
accordance with the Intercreditor Agreement and the Trust Agreements) or
are otherwise no longer entitled to the benefits of this Agreement; (iii)
the date on which the Borrower delivers to the Liquidity Provider a
certificate, signed by a Responsible Officer of the Borrower, certifying
that a Replacement Liquidity Facility has been substituted for this
Agreement in full pursuant to Section 3.6(e) of the Intercreditor
Agreement; (iv) the fifth Business Day following the receipt by the
Borrower of a Termination Notice from the Liquidity Provider pursuant to
Section 6.01 hereof; and (v) the date on which no Advance is or may
(including by reason of reinstatement as herein provided) become available
for a Borrowing hereunder.
"Termination Notice" means the Notice of Termination
substantially in the form of Annex V to this Agreement.
"Transferee" has the meaning assigned to such term in
Section 7.08(b).
"Unapplied Downgrade Advance" means any Downgrade Advance
other than an Applied Downgrade Advance.
"Unapplied Provider Advance" means any Provider Advance
other than an Applied Provider Advance.
"Unpaid Advance" has the meaning assigned to such term in
Section 2.05.
(b) Terms Defined in the Intercreditor Agreement. For all
purposes of this Agreement, the following terms shall have the respective
meanings assigned to such terms in the Intercreditor Agreement:
"Acceleration", "AIFS", "Certificates", "Class A
Certificates", "Class B Cash Collateral Account", "Class B
Certificateholders", "Class B Certificates", "Class B Trust", "Class B
Trust Agreement", "Class B Trustee", "Class C Certificates", "Class C
Purchase Agreement", "Closing Date", "Controlling Party", "Corporate Trust
Office", "Delivery Period Expiry Date", "Distribution Date", "Downgraded
Facility", "Equipment Notes", "Fee Letter", "Final Legal Distribution
Date", "Financing Agreement", "Indenture", "Interest Payment Date",
"Investment Earnings", "Leased Aircraft", "Liquidity Facility", "Liquidity
Obligations", "Loan Trustee", "Moody's", "Non-Extended Facility", "Note
Purchase Agreement", "Operative Agreements", "Owned Aircraft",
"Participation Agreement", "Performing Equipment Note", "Person", "Pool
Balance", "Rating Agency", "Ratings Confirmation", "Regular Distribution
Date", "Replacement Liquidity Facility", "Responsible Officer", "Scheduled
Payment", "Special Payment", "Standard & Poor's", "Stated Interest Rate",
"Subordination Agent", "Taxes", "Threshold Rating", "Trust Agreements",
"Trustee", "Underwriters", "Underwriting Agreement", "US Airways", "US
Airways Bankruptcy Event" and "Written Notice".
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. The Advances. The Liquidity Provider hereby
irrevocably agrees, on the terms and conditions hereinafter set forth, to
make Advances to the Borrower from time to time on any Business Day during
the period from the Effective Date until 12:00 Noon (New York City time) on
the Expiry Date (unless the obligations of the Liquidity Provider shall be
earlier terminated in accordance with the terms of Section 2.04(b)) in an
aggregate amount at any time outstanding not to exceed the Maximum
Commitment.
Section 2.02. Making the Advances. (a) Interest Advances
shall be made in one or more Borrowings by delivery to the Liquidity
Provider of one or more written and completed Notices of Borrowing in
substantially the form of Annex I attached hereto, signed by a Responsible
Officer of the Borrower, in an amount not exceeding the Maximum Available
Commitment at such time and shall be used solely for the payment when due
of interest on the Class B Certificates at the Stated Interest Rate
therefor in accordance with Section 3.6(a) of the Intercreditor Agreement.
Each Interest Advance made hereunder shall automatically reduce the Maximum
Available Commitment and the amount available to be borrowed hereunder by
subsequent Advances by the amount of such Interest Advance (subject to
reinstatement as provided in the next sentence). Upon repayment to the
Liquidity Provider of all or any part of the amount of any Interest Advance
made pursuant to this Section 2.02(a), together with accrued interest
thereon (as provided herein), the Maximum Available Commitment shall be
reinstated by the amount of such repaid Interest Advance, but not to exceed
the Maximum Commitment; provided, however, that the Maximum Available
Commitment shall not be so reinstated at any time if (i) a Liquidity Event
of Default shall have occurred and be continuing and (ii) there is a
Performing Note Deficiency.
(b) A Non-Extension Advance shall be made in a single
Borrowing if this Agreement is not extended in accordance with Section
3.6(d) of the Intercreditor Agreement (unless a Replacement Liquidity
Facility to replace this Agreement shall have been delivered to the
Borrower as contemplated by said Section 3.6(d) within the time period
specified in such Section) by delivery to the Liquidity Provider of a
written and completed Notice of Borrowing in substantially the form of
Annex II attached hereto, signed by a Responsible Officer of the Borrower,
in an amount equal to the Maximum Available Commitment at such time, and
shall be used to fund the Class B Cash Collateral Account in accordance
with said Section 3.6(d) and Section 3.6(f) of the Intercreditor Agreement.
(c) A Downgrade Advance shall be made in a single Borrowing
upon a downgrading of the Liquidity Provider's short-term unsecured debt
rating issued by either Rating Agency below the applicable Threshold Rating
(as provided for in Section 3.6(c) of the Intercreditor Agreement) unless a
Replacement Liquidity Facility to replace this Agreement shall have been
previously delivered to the Borrower in accordance with said Section 3.6(c)
and within the time period specified in such Section, by delivery to the
Liquidity Provider of a written and completed Notice of Borrowing in
substantially the form of Annex III attached hereto, signed by a
Responsible Officer of the Borrower, in an amount equal to the Maximum
Available Commitment at such time, and shall be used to fund the Class B
Cash Collateral Account in accordance with said Section 3.6(c) and Section
3.6(f) of the Intercreditor Agreement.
(d) A Final Advance shall be made in a single Borrowing upon
the receipt by the Borrower of a Termination Notice from the Liquidity
Provider pursuant to Section 6.01 hereof by delivery to the Liquidity
Provider of a written and completed Notice of Borrowing in substantially
the form of Annex IV attached hereto, signed by a Responsible Officer of
the Borrower, in an amount equal to the Maximum Available Commitment at
such time, and shall be used to fund the Class B Cash Collateral Account in
accordance with Section 3.6(i) and Section 3.6(f) of the Intercreditor
Agreement.
(e) Each Borrowing shall be made on notice in writing (a
"Notice of Borrowing") in substantially the form required by Section
2.02(a), 2.02(b), 2.02(c) or 2.02(d), as the case may be, given by the
Borrower to the Liquidity Provider. If a Notice of Borrowing is delivered
by the Borrower in respect of any Borrowing no later than 1:00 p.m. (New
York City time) on a Business Day, upon satisfaction of the conditions
precedent set forth in Section 4.02 with respect to a requested Borrowing,
the Liquidity Provider shall make available to the Borrower, in accordance
with its payment instructions, the amount of such Borrowing in U.S. dollars
and immediately available funds, before 4:00 p.m. (New York City time) on
such Business Day or on such later Business Day specified in such Notice of
Borrowing. If a Notice of Borrowing is delivered by the Borrower in respect
of any Borrowing after 1:00 p.m. (New York City time) on a Business Day,
upon satisfaction of the conditions precedent set forth in Section 4.02
with respect to a requested Borrowing, the Liquidity Provider shall make
available to the Borrower, in accordance with its payment instructions, the
amount of such Borrowing in U.S. dollars and in immediately available
funds, before 12:00 noon (New York City time) on the first Business Day
next following the day of receipt of such Notice of Borrowing or on such
later Business Day specified by the Borrower in such Notice of Borrowing.
Payments of proceeds of a Borrowing shall be made by wire transfer of
immediately available funds to the Borrower in accordance with such wire
transfer instructions as the Borrower shall furnish from time to time to
the Liquidity Provider for such purpose. Each Notice of Borrowing shall be
irrevocable and binding on the Borrower.
(f) Upon the making of any Advance requested pursuant to a
Notice of Borrowing, in accordance with the Borrower's payment
instructions, the Liquidity Provider shall be fully discharged of its
obligation hereunder with respect to such Notice of Borrowing, and the
Liquidity Provider shall not thereafter be obligated to make any further
Advances hereunder in respect of such Notice of Borrowing to the Borrower
or to any other Person. Following the making of any Advance pursuant to
Section 2.02(b), (c) or (d) hereof to fund the Class B Cash Collateral
Account, the Liquidity Provider shall have no interest in or rights to the
Class B Cash Collateral Account, such Advance or any other amounts from
time to time on deposit in the Class B Cash Collateral Account; provided
that the foregoing shall not affect or impair the obligations of the
Subordination Agent to make the distributions contemplated by Section
3.6(e) or (f) of the Intercreditor Agreement, and provided further, that
the foregoing shall not affect or impair the rights of the Liquidity
Provider to provide written instructions with respect to the investment and
reinvestment of amounts in the Cash Collateral Accounts to the extent
provided in Section 2.2(b) of the Intercreditor Agreement. By paying to the
Borrower proceeds of Advances requested by the Borrower in accordance with
the provisions of this Agreement, the Liquidity Provider makes no
representation as to, and assumes no responsibility for, the correctness or
sufficiency for any purpose of the amount of the Advances so made and
requested.
Section 2.03. Fees. The Borrower agrees to pay to the
Liquidity Provider the fees set forth in the Fee Letter.
Section 2.04. Reductions or Termination of the Maximum
Commitment.
(a) Automatic Reduction. Promptly following each date on
which the Required Amount is reduced as a result of a reduction in the Pool
Balance of the Class B Certificates or otherwise, the Maximum Commitment
shall automatically be reduced to an amount equal to such reduced Required
Amount (as calculated by the Borrower). The Borrower shall give notice of
any such automatic reduction of the Maximum Commitment to the Liquidity
Provider within two Business Days thereof. The failure by the Borrower to
furnish any such notice shall not affect such automatic reduction of the
Maximum Commitment.
(b) Termination. Upon the making of any Provider Advance or
Final Advance hereunder or the occurrence of the Termination Date, the
obligation of the Liquidity Provider to make further Advances hereunder
shall automatically and irrevocably terminate, and the Borrower shall not
be entitled to request any further Borrowing hereunder.
Section 2.05. Repayments of Interest Advances or the Final
Advance. Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower
hereby agrees, without notice of an Advance or demand for repayment from
the Liquidity Provider (which notice and demand are hereby waived by the
Borrower), to pay, or to cause to be paid, to the Liquidity Provider on
each date on which the Liquidity Provider shall make an Interest Advance or
the Final Advance, an amount equal to (a) the amount of such Advance (any
such Advance, until repaid, is referred to herein as an "Unpaid Advance"),
plus (b) interest on the amount of each such Unpaid Advance as provided in
Section 3.07 hereof; provided that if (i) the Liquidity Provider shall make
a Provider Advance at any time after making one or more Interest Advances
which shall not have been repaid in accordance with this Section 2.05 or
(ii) this Liquidity Facility shall become a Downgraded Facility or
Non-Extended Facility at any time when unreimbursed Interest Advances have
reduced the Maximum Available Commitment to zero, then such Interest
Advances shall cease to constitute Unpaid Advances and shall be deemed to
have been changed into an Applied Downgrade Advance or an Applied
Non-Extension Advance, as the case may be, for all purposes of this
Agreement (including, without limitation, for the purpose of determining
when such Interest Advance is required to be repaid to the Liquidity
Provider in accordance with Section 2.06 and for the purposes of Section
2.06(b)). The Borrower and the Liquidity Provider agree that the repayment
in full of each Interest Advance and Final Advance on the date such Advance
is made is intended to be a contemporaneous exchange for new value given to
the Borrower by the Liquidity Provider.
Section 2.06. Repayments of Provider Advances. (a) Amounts
advanced hereunder in respect of a Provider Advance shall be deposited in
the Class B Cash Collateral Account, invested and withdrawn from the Class
B Cash Collateral Account as set forth in Sections 3.6(c), (d) and (f) of
the Intercreditor Agreement. The Borrower agrees to pay to the Liquidity
Provider, on each Regular Distribution Date, commencing on the first
Regular Distribution Date after the making of a Provider Advance, interest
on the principal amount of any such Provider Advance as provided in Section
3.07 hereof; provided, however, that amounts in respect of a Provider
Advance withdrawn from the Class B Cash Collateral Account for the purpose
of paying interest on the Class B Certificates in accordance with Section
3.6(f) of the Intercreditor Agreement (the amount of any such withdrawal
being (y) in the case of a Downgrade Advance, an "Applied Downgrade
Advance" and (z) in the case of a Non-Extension Advance, an "Applied
Non-Extension Advance" and, together with an Applied Downgrade Advance, an
"Applied Provider Advance") shall thereafter (subject to Section 2.06(b))
be treated as an Interest Advance under this Agreement for purposes of
determining the Applicable Liquidity Rate for interest payable thereon;
provided further, however, that if, following the making of a Provider
Advance, the Liquidity Provider delivers a Termination Notice to the
Borrower pursuant to Section 6.01 hereof, such Provider Advance shall
thereafter be treated as a Final Advance under this Agreement for purposes
of determining the Applicable Liquidity Rate for interest payable thereon.
Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal
of any amounts from the Class B Cash Collateral Account on account of a
reduction in the Required Amount, the Borrower shall repay to the Liquidity
Provider a portion of the Provider Advances in a principal amount equal to
such reduction, plus interest on the principal amount prepaid as provided
in Section 3.07 hereof.
(b) At any time when an Applied Provider Advance (or any
portion thereof) is outstanding, upon the deposit in the Class B Cash
Collateral Account of any amount pursuant to clause "third" of Section
2.4(b) of the Intercreditor Agreement, clause "third" of Section 3.2 of the
Intercreditor Agreement or clause "fourth" of Section 3.3 of the
Intercreditor Agreement (any such amount being a "Replenishment Amount")
for the purpose of replenishing or increasing the balance thereof up to the
Required Amount at such time, (i) the aggregate outstanding principal
amount of all Applied Provider Advances (and of Provider Advances treated
as an Interest Advance for purposes of determining the Applicable Liquidity
Rate for interest payable thereon) shall be automatically reduced by the
amount of such Replenishment Amount and (ii) the aggregate outstanding
principal amount of all Unapplied Provider Advances shall be automatically
increased by the amount of such Replenishment Amount.
(c) Upon the provision of a Replacement Liquidity Facility
in replacement of this Agreement in accordance with Section 3.6(e) of the
Intercreditor Agreement, amounts remaining on deposit in the Class B Cash
Collateral Account after giving effect to any Applied Provider Advance on
the date of such replacement shall be reimbursed to the Liquidity Provider,
but only to the extent such amounts are necessary to repay in full to the
Liquidity Provider all amounts owing to it hereunder.
Section 2.07. Payments to the Liquidity Provider Under the
Intercreditor Agreement. In order to provide for payment or repayment to
the Liquidity Provider of any amounts hereunder, the Intercreditor
Agreement provides that amounts available and referred to in Articles II
and III of the Intercreditor Agreement, to the extent payable to the
Liquidity Provider pursuant to the terms of the Intercreditor Agreement
(including, without limitation, Section 3.6(f) of the Intercreditor
Agreement), shall be paid to the Liquidity Provider in accordance with the
terms thereof. Amounts so paid to the Liquidity Provider shall be applied
by the Liquidity Provider to Liquidity Obligations then due and payable in
accordance with the Intercreditor Agreement or, if not provided for in the
Intercreditor Agreement, then in such manner as the Liquidity Provider
shall deem appropriate.
Section 2.08. Book Entries. The Liquidity Provider shall
maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower resulting from Advances made
from time to time and the amounts of principal and interest payable
hereunder and paid from time to time in respect thereof; provided, however,
that the failure by the Liquidity Provider to maintain such account or
accounts shall not affect the obligations of the Borrower in respect of
Advances.
Section 2.09. Payments from Available Funds Only. All
payments to be made by the Borrower under this Agreement shall be made only
from the amounts that constitute Scheduled Payments, Special Payments or
payments under Section 6(c) or 6(b), as the case may be, of the
Participation Agreements and Section 7 of the Note Purchase Agreement and
only to the extent that the Borrower shall have sufficient income or
proceeds therefrom to enable the Borrower to make payments in accordance
with the terms hereof after giving effect to the priority of payments
provisions set forth in the Intercreditor Agreement. The Liquidity Provider
agrees that it will look solely to such amounts to the extent available for
distribution to it as provided in the Intercreditor Agreement and this
Agreement and that the Borrower, in its individual capacity, is not
personally liable to it for any amounts payable or liability under this
Agreement except as expressly provided in this Agreement, the Intercreditor
Agreement or any Participation Agreement. Amounts on deposit in the Class B
Cash Collateral Account shall be available to the Borrower to make payments
under this Agreement only to the extent and for the purposes expressly
contemplated in Section 3.6(f) of the Intercreditor Agreement.
Section 2.10. Extension of the Expiry Date; Non-Extension
Advance. No earlier than the 60th day and no later than the 40th day prior
to the then effective Expiry Date (unless such Expiry Date is on or after
the date that is 15 days after the Final Legal Distribution Date for the
Class B Certificates), the Borrower shall request that the Liquidity
Provider extend the Expiry Date for a period of 364 days after the then
effective Expiry Date (unless the obligations of the Liquidity Provider are
earlier terminated in accordance with the terms hereof). The Liquidity
Provider may advise the Borrower, no earlier than 40 days and no later than
25 days prior to the then effective Expiry Date that it agrees to so extend
the Expiry Date but in any event, without the necessity of any action on
the part of the Liquidity Provider the Expiry Date shall automatically be
so extended, unless the Liquidity Provider advises the Borrower on or
before the 25th day prior to the Expiry Date then in effect that such
Expiry Date shall not be so extended in which event (and if the Liquidity
Provider shall not have been replaced in accordance with Section 3.6(e) of
the Intercreditor Agreement), the Borrower shall be entitled on and after
such 25th day (but prior to the then effective Expiry Date) to request a
Non- Extension Advance in accordance with Section 2.02(b) hereof and
Section 3.6(d) of the Intercreditor Agreement.
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01. Increased Costs. The Borrower shall pay to the
Liquidity Provider from time to time such amounts as may be necessary to
compensate the Liquidity Provider for any increased costs incurred by the
Liquidity Provider which are attributable to its making or maintaining any
LIBOR Advances hereunder or its obligation to make any such Advances
hereunder, or any reduction in any amount receivable by the Liquidity
Provider under this Agreement or the Intercreditor Agreement in respect of
any such Advances or such obligation (such increases in costs and
reductions in amounts receivable being herein called "Additional Costs"),
resulting from any change after the date of this Agreement in U.S. federal,
state, municipal, or foreign laws or regulations (including Regulation D of
the Board of Governors of the Federal Reserve System), or the adoption or
making after the date of this Agreement of any interpretations, directives,
or requirements applying to a class of banks including the Liquidity
Provider under any U.S. federal, state, municipal, or any foreign laws or
regulations (whether or not having the force of law) by any court, central
bank or monetary authority charged with the interpretation or
administration thereof (a "Regulatory Change"), which: (1) changes the
basis of taxation of any amounts payable to the Liquidity Provider under
this Agreement in respect of any such Advances (other than Excluded Taxes);
or (2) imposes or modifies any reserve, special deposit, compulsory loan or
similar requirements relating to any extensions of credit or other assets
of, or any deposits with other liabilities of, the Liquidity Provider
(including any such Advances or any deposits referred to in the definition
of LIBOR Rate or related definitions). The Liquidity Provider agrees to use
reasonable efforts (consistent with applicable legal and regulatory
restrictions) to change the jurisdiction of its Facility Office if making
such change would avoid the need for, or reduce the amount of, any amount
payable under this Section that may thereafter accrue and would not, in the
reasonable judgment of the Liquidity Provider, be otherwise disadvantageous
to the Liquidity Provider.
The Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Liquidity
Provider to compensation pursuant to this Section 3.01 as promptly as
practicable after it obtains knowledge thereof and determines to request
such compensation, which notice shall describe in reasonable detail the
calculation of the amounts owed under this Section. Determinations by the
Liquidity Provider for purposes of this Section 3.01 of the effect of any
Regulatory Change on its costs of making or maintaining Advances or on
amounts receivable by it in respect of Advances, and of the additional
amounts required to compensate the Liquidity Provider in respect of any
Additional Costs, shall be prima facie evidence of the amount owed under
this Section.
Notwithstanding the preceding two paragraphs, the Liquidity
Provider and the Subordination Agent agree that the initial Liquidity
Provider (i.e., AIG Matched Funding Corp.) shall not be entitled to the
benefits of the preceding two paragraphs, provided, however, any permitted
assignee or participant of the initial Liquidity Provider which is a bank
organized under the laws of the United States or any State thereof shall be
entitled to the benefits of the preceding two paragraphs (subject, in the
case of any permitted participant, to the limitation set forth in Section
7.08 hereof).
Section 3.02. Capital Adequacy. If (1) the adoption, after
the date hereof, of any applicable governmental law, rule or regulation
regarding capital adequacy, (2) any change, after the date hereof, in the
interpretation or administration of any such law, rule or regulation by any
central bank or other governmental authority charged with the
interpretation or administration thereof or (3) compliance by the Liquidity
Provider or any corporation controlling the Liquidity Provider with any
applicable guideline or request of general applicability, issued after the
date hereof, by any central bank or other governmental authority (whether
or not having the force of law) that constitutes a change of the nature
described in clause (2), has the effect of requiring an increase in the
amount of capital required to be maintained by the Liquidity Provider or
any corporation controlling the Liquidity Provider, and such increase is
based upon the Liquidity Provider's obligations hereunder and other similar
obligations, the Borrower shall pay to the Liquidity Provider from time to
time such additional amount or amounts as are necessary to compensate the
Liquidity Provider for such portion of such increase as shall be reasonably
allocable to the Liquidity Provider's obligations to the Borrower
hereunder. The Liquidity Provider agrees to use reasonable efforts
(consistent with applicable legal and regulatory restrictions) to change
the jurisdiction of its Facility Office if making such change would avoid
the need for, or reduce the amount of, any amount payable under this
Section that may thereafter accrue and would not, in the reasonable
judgment of the Liquidity Provider, be otherwise materially disadvantageous
to the Liquidity Provider.
The Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Liquidity
Provider to compensation pursuant to this Section 3.02 as promptly as
practicable after it obtains knowledge thereof and determines to request
such compensation, which notice shall describe in reasonable detail the
calculation of the amounts owed under this Section. Determinations by the
Liquidity Provider for purposes of this Section 3.02 of the effect of any
increase in the amount of capital required to be maintained by the
Liquidity Provider and of the amount allocable to the Liquidity Provider's
obligations to the Borrower hereunder shall be prima facie evidence of the
amounts owed under this Section.
Notwithstanding the preceding two paragraphs, the Liquidity
Provider and the Subordination Agent agree that the initial Liquidity
Provider (i.e., AIG Matched Funding Corp.) shall not be entitled to the
benefits of the preceding two paragraphs, provided, however, any permitted
assignee or participant of the initial Liquidity Provider which is a bank
organized under the laws of the United States or any State thereof shall be
entitled to the benefits of the preceding two paragraphs (subject, in the
case of any permitted participant, to the limitation set forth in Section
7.08 hereof).
Section 3.03. Payments Free of Deductions. (a) All payments
made by the Borrower under this Agreement shall be made free and clear of,
and without reduction for or on account of, any present or future stamp or
other taxes, levies, imposts, duties, charges, fees, deductions,
withholdings, restrictions or conditions of any nature whatsoever now or
hereafter imposed, levied, collected, withheld or assessed, excluding
Excluded Taxes (such non-excluded taxes being referred to herein,
collectively, as "Non-Excluded Taxes" and, individually, as a "Non-Excluded
Tax"). If any Non-Excluded Taxes are required to be withheld from any
amounts payable to the Liquidity Provider under this Agreement, the amounts
so payable to the Liquidity Provider shall be increased to the extent
necessary to yield to the Liquidity Provider (after payment of all
Non-Excluded Taxes) interest or any other such amounts payable under this
Agreement at the rates or in the amounts specified in this Agreement. The
Liquidity Provider agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Facility Office if making such change would avoid the
need for, or reduce the amount of, any such additional amounts that may
thereafter accrue and would not, in the reasonable judgment of the
Liquidity Provider, be otherwise disadvantageous to the Liquidity Provider.
From time to time upon the reasonable request of the Borrower, if the
Liquidity Provider is not a corporation organized under the laws of the
United States or any State thereof, the Liquidity Provider agrees to
provide to the Borrower two original Internal Revenue Service Form W-8BEN
or W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that the Liquidity Provider is exempt
from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement.
Section 3.04. Payments. The Borrower shall make or cause to
be made each payment to the Liquidity Provider under this Agreement so as
to cause the same to be received by the Liquidity Provider not later than
1:00 p.m. (New York City time) on the day when due. The Borrower shall make
all such payments in lawful money of the United States of America, to the
Liquidity Provider in immediately available funds, by wire transfer to UBS
AG, Stamford, CT, ABA #0260-07993, Account Name: AIG Matched Funding Corp.,
Account No. WA-659-886-000, Reference: US Airways Liquidity Facility
1999-1B.
Section 3.05. Computations. All computations of interest
based on the Base Rate shall be made on the basis of a year of 365 or 366
days, as the case may be, and all computations of interest based on the
LIBOR Rate shall be made on the basis of a year of 360 days, in each case
for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest is payable.
Section 3.06. Payment on Non-Business Days. Whenever any
payment to be made hereunder shall be stated to be due on a day other than
a Business Day, such payment shall be made on the next succeeding Business
Day and no additional interest shall be due as a result (and if so made,
shall be deemed to have been made when due). If any payment in respect of
interest on an Advance is so deferred to the next succeeding Business Day,
such deferral shall not delay the commencement of the next Interest Period
for such Advance (if such Advance is a LIBOR Advance) or reduce the number
of days for which interest will be payable on such Advance on the next
interest payment date for such Advance.
Section 3.07. Interest. (a) Subject to Section 2.09, the
Borrower shall pay, or shall cause to be paid, without duplication,
interest on (i) the unpaid principal amount of each Advance from and
including the date of such Advance (or, in the case of an Applied Provider
Advance, from and including the date on which the amount thereof was
withdrawn from the Class B Cash Collateral Account to pay interest on the
Class B Certificates) to but excluding the date such principal amount shall
be paid in full (or, in the case of an Applied Provider Advance, the date
on which the Class B Cash Collateral Account is fully replenished in
respect of such Advance) and (ii) any other amount due hereunder (whether
fees, commissions, expenses or other amounts or, to the extent permitted by
law, installments of interest on Advances or any such other amount) which
is not paid when due (whether at stated maturity, by acceleration or
otherwise) from and including the due date thereof to but excluding the
date such amount is paid in full, in each such case, at a fluctuating
interest rate per annum for each day equal to the Applicable Liquidity Rate
(as defined below) for such Advance or such other amount as in effect for
such day, but in no event at a rate per annum greater than the maximum rate
permitted by applicable law; provided, however, that, if at any time the
otherwise applicable interest rate as set forth in this Section 3.07 shall
exceed the maximum rate permitted by applicable law, then any subsequent
reduction in such interest rate will not reduce the rate of interest
payable pursuant to this Section 3.07 below the maximum rate permitted by
applicable law until the total amount of interest accrued equals the amount
of interest that would have accrued if such otherwise applicable interest
rate as set forth in this Section 3.07 had at all times been in effect.
(b) Except as provided in clause (e) below, each Advance
will be either a Base Rate Advance or a LIBOR Advance as provided in this
Section. Each such Advance will be a Base Rate Advance for the period from
the date of its borrowing to (but excluding) the third Business Day
following the Liquidity Provider's receipt of the Notice of Borrowing for
such Advance. Thereafter, such Advance shall be a LIBOR Advance; provided
that the Borrower (at the direction of the Controlling Party, so long as
the Liquidity Provider is not the Controlling Party) may (x) convert the
Final Advance into a Base Rate Advance on the last day of an Interest
Period for such Advance by giving the Liquidity Provider no less than four
Business Days' prior written notice of such election or (y) elect to
maintain the Final Advance as a Base Rate Advance by not requesting a
conversion of the Final Advance to a LIBOR Advance under Clause (5) of the
applicable Notice of Borrowing (or, if such Final Advance is deemed to have
been made, without delivery of a Notice of Borrowing pursuant to Section
2.06, by requesting, prior to 11:00 a.m. on the first Business Day
immediately following the Borrower's receipt of the applicable Termination
Notice, that such Final Advance not be converted from a Base Rate Advance
to a LIBOR Advance).
(c) Each LIBOR Advance shall bear interest during each
Interest Period at a rate per annum equal to the LIBOR Rate for such
Interest Period plus the Applicable Margin for such LIBOR Advance, payable
in arrears on the last day of such Interest Period and, in the event of the
payment of principal of such LIBOR Advance on a day other than such last
day, on the date of such payment (to the extent of interest accrued on the
amount of principal repaid).
(d) Each Base Rate Advance shall bear interest at a rate per
annum equal to the Base Rate plus the Applicable Margin for such Base Rate
Advance, payable in arrears on each Regular Distribution Date and, in the
event of the payment of principal of such Base Rate Advance on a day other
than a Regular Distribution Date, on the date of such payment (to the
extent of interest accrued on the amount of principal repaid).
(e) Each outstanding Unapplied Provider Advance shall bear
interest in an amount equal to the Investment Earnings on amounts on
deposit in the Class B Cash Collateral Account plus the Applicable Margin
for such Unapplied Provider Advance on the amount of such Unapplied
Provider Advance from time to time, payable in arrears on each Regular
Distribution Date.
(f) Each amount not paid when due hereunder (whether fees,
commissions, expenses or other amounts or, to the extent permitted by
applicable law, installments of interest on Advances but excluding
Advances) shall bear interest at a rate per annum equal to the Base
Rate plus 2.00% until paid.
(g) Each change in the Base Rate shall become effective
immediately. The rates of interest specified in this Section 3.07 with
respect to any Advance or other amount shall be referred to as the
"Applicable Liquidity Rate".
Section 3.08. Replacement of Borrower. From time to time and
subject to the successor Borrower's meeting the eligibility requirements
set forth in Section 6.9 of the Intercreditor Agreement applicable to the
Subordination Agent, upon the effective date and time specified in a
written and completed Notice of Replacement Subordination Agent in
substantially the form of Annex VI attached hereto (a "Notice of
Replacement Subordination Agent") delivered to the Liquidity Provider by
the then Borrower, the successor Borrower designated therein shall be
substituted for as the Borrower for all purposes hereunder.
Section 3.09. Funding Loss Indemnification. The Borrower
shall pay to the Liquidity Provider, upon the request of the Liquidity
Provider, such amount or amounts as shall be sufficient (in the reasonable
opinion of the Liquidity Provider) to compensate it for any loss, cost, or
expense incurred by reason of the liquidation or redeployment of deposits
or other funds acquired by the Liquidity Provider to fund or maintain any
LIBOR Advance (but excluding loss of anticipated profits) incurred as a
result of:
(1) Any repayment of a LIBOR Advance or conversion of a
LIBOR Advance to a Base Rate Advance on a date other than the last day of
the Interest Period for such Advance; or
(2) Any failure by the Borrower to borrow a LIBOR Advance on
the date for borrowing specified in the relevant notice under Section 2.02.
Section 3.10. Illegality. Notwithstanding any other
provision in this Agreement, if any change in any applicable law, rule or
regulation, or any change in the interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by the
Liquidity Provider (or its Facility Office) with any request or directive
(whether or not having the force of law) of any such authority, central
bank or comparable agency shall make it unlawful or impossible for the
Liquidity Provider (or its Facility Office) to maintain or fund its LIBOR
Advances, then upon notice to the Borrower by the Liquidity Provider, the
outstanding principal amount of the LIBOR Advances shall be converted to
Base Rate Advances (a) immediately upon demand of the Liquidity Provider,
if such change or compliance with such request, in the judgment of the
Liquidity Provider, requires immediate repayment; or (b) at the expiration
of the last Interest Period to expire before the effective date of any such
change or request.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent to Effectiveness of
Section 2.01. Section 2.01 of this Agreement shall become effective on and
as of the first date (the "Effective Date") on which the following
conditions precedent have been satisfied or waived:
(a) The Liquidity Provider shall have received on or before
the Closing Date each of the following, and in the case of each document
delivered pursuant to paragraphs (i), (ii) and (iii), each in form and
substance satisfactory to the Liquidity Provider:
(i) This Agreement duly executed on behalf of the
Borrower;
(ii) The Intercreditor Agreement duly executed on behalf
of each of the parties thereto;
(iii) Fully executed copies of each of the Operative
Agreements executed and delivered on or before the
Closing Date (other than this Agreement and the
Intercreditor Agreement);
(iv) A copy of the Prospectus Supplement and specimen
copies of the Class B Certificates;
(v) An executed copy of each document, instrument,
certificate and opinion delivered on or before the
Closing Date pursuant to the Class B Trust
Agreement, the Intercreditor Agreement and the other
Operative Agreements (in the case of each such
opinion, other than the opinion of counsel for the
Underwriters, either addressed to the Liquidity
Provider or accompanied by a letter from the counsel
rendering such opinion to the effect that the
Liquidity Provider is entitled to rely on such
opinion as of its date as if it were addressed to
the Liquidity Provider);
(vi) Evidence that there shall have been made and shall
be in full force and effect, all filings, recordings
and/or registrations, and there shall have been
given or taken any notice or other similar action as
may be reasonably necessary or, to the extent
reasonably requested by the Liquidity Provider,
reasonably advisable, in order to establish,
perfect, protect and preserve the right, title and
interest, remedies, powers, privileges, liens and
security interests of, or for the benefit of, the
Trustees, the Borrower and the Liquidity Provider
created by the Operative Agreements executed and
delivered on or prior to the Closing Date;
(vii) An agreement from US Airways, pursuant to which (i) US
Airways agrees to provide copies of quarterly
financial statements and audited annual financial
statements to the Liquidity Provider, and such other
information as the Liquidity Provider shall
reasonably request with respect to the transactions
contemplated by the Operative Agreements, in each
case, only to the extent that US Airways is
obligated to provide such information pursuant to
Section 16 of the Leases (related to Leased
Aircraft) or the corresponding section of the
Indentures (related to Owned Aircraft) to the
parties thereto and (ii) US Airways agrees to allow
the Liquidity Provider to inspect US Airways' books
and records regarding such transactions, and to
discuss such transactions with officers and
employees of US Airways; and
(viii) Such other documents, instruments, opinions and
approvals pertaining to the transactions
contemplated hereby or by the other Operative
Agreements as the Liquidity Provider shall have
reasonably requested.
(b) The following statement shall be true on and as of the
Effective Date: no event has occurred and is continuing, or would result
from the entering into of this Agreement or the making of any Advance,
which constitutes a Liquidity Event of Default.
(c) The Liquidity Provider shall have received payment in
full of all fees and other sums required to be paid to or for the account
of the Liquidity Provider on or prior to the Effective Date.
(d) All conditions precedent to the issuance of the
Certificates under the Trust Agreements shall have been satisfied or
waived, all conditions precedent to the effectiveness of the other
Liquidity Facilities shall have been satisfied or waived, and all
conditions precedent to the purchase of the Class A Certificates and Class
B Certificates by the Underwriters under the Underwriting Agreement and the
purchase of the Class C Certificates by AIFS under the Class C Purchase
Agreement shall have been satisfied (unless any of such conditions
precedent shall have been waived by the Underwriters or AIFS, as the case
may be).
(e) The Borrower shall have received a certificate, dated
the date hereof, signed by a duly authorized representative of the
Liquidity Provider, certifying that all conditions precedent to the
effectiveness of Section 2.01 have been satisfied or waived.
Section 4.02. Conditions Precedent to Borrowing. The
obligation of the Liquidity Provider to make an Advance on the occasion of
each Borrowing shall be subject to the conditions precedent that the
Effective Date shall have occurred and, prior to the date of such
Borrowing, the Borrower shall have delivered a Notice of Borrowing which
conforms to the terms and conditions of this Agreement and has been
completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants of the Borrower. So long
as any Advance shall remain unpaid or the Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to
pay any amount to the Liquidity Provider hereunder, the Borrower will,
unless the Liquidity Provider shall otherwise consent in writing:
(a) Performance of This and Other Agreements. Punctually pay
or cause to be paid all amounts payable by it under this Agreement and the
other Operative Agreements and observe and perform in all material respects
the conditions, covenants and requirements applicable to it contained in
this Agreement and the other Operative Agreements.
(b) Reporting Requirements. Furnish to the Liquidity
Provider with reasonable promptness, such other information and data with
respect to the transactions contemplated by the Operative Agreements as
from time to time may be reasonably requested by the Liquidity Provider;
and permit the Liquidity Provider, upon reasonable notice, to inspect the
Borrower's books and records with respect to such transactions and to meet
with officers and employees of the Borrower to discuss such transactions.
(c) Certain Operative Agreements. Furnish to the Liquidity
Provider with reasonable promptness, such Operative Agreements entered into
after the date hereof as from time to time may be reasonably requested by
the Liquidity Provider.
Section 5.02. Negative Covenants of the Borrower. So long as
any Advance shall remain unpaid or the Liquidity Provider shall have any
Maximum Commitment hereunder or the Borrower shall have any obligation to
pay any amount to the Liquidity Provider hereunder, the Borrower will not
appoint or permit or suffer to be appointed any successor Borrower without
the prior written consent of the Liquidity Provider, which consent shall
not be unreasonably withheld or delayed.
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. Liquidity Events of Default. If (a) any
Liquidity Event of Default has occurred and is continuing and (b) there is
a Performing Note Deficiency, the Liquidity Provider may, in its
discretion, deliver to the Borrower a Termination Notice, the effect of
which shall be to cause (i) the obligation of the Liquidity Provider to
make Advances hereunder to expire on the fifth Business Day after the date
on which such Termination Notice is received by the Borrower, (ii) the
Borrower to promptly request, and the Liquidity Provider to promptly make,
a Final Advance in accordance with Section 2.02(d) hereof and Section
3.6(i) of the Intercreditor Agreement, (iii) all other outstanding Advances
to be automatically converted into Final Advances for purposes of
determining the Applicable Liquidity Rate for interest payable thereon, and
(iv) subject to Sections 2.07 and 2.09 hereof, all Advances (including,
without limitation, any Provider Advance and Applied Provider Advance), any
accrued interest thereon and any other amounts outstanding hereunder to
become immediately due and payable to the Liquidity Provider.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Liquidity Provider, and, in the case of an
amendment or of a waiver by the Borrower, the Borrower, and then such
waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
Section 7.02. Notices, Etc. Except as otherwise expressly
provided herein, all notices and other communications provided for
hereunder shall be in writing (including telecopier and mailed or delivered
or sent by telecopier):
Borrower: STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
225 Asylum Street
Goodwyn Square
Hartford, CT 06103
Attention: Corporate/Muni. Department
Telephone: (860) 244-1822
Telecopy: (860) 244-1889
with a copy to:
State Street Bank and Trust Company.
Corporate Trust Department
2 International Place, 4th Floor
Boston, MA 02110
Attention: Ruth A. Smith
Telecopy: (617) 664-5151
Liquidity Provider: AIG MATCHED FUNDING CORP.
100 Nyala Farm
Westport, CT 06880
Attention: Chief Financial Officer
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
with a copy to:
The General Counsel
AIG Matched Funding Corp.
100 Nyala Farm
Westport, CT 06880
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
or, as to each of the foregoing, at such other address as shall be
designated by such Person in a written notice to the others. All such
notices and communications shall be effective (i) if given by telecopier,
when transmitted to the telecopier number specified above and (ii) if given
by other means, when delivered at the address specified above, except that
written notices to the Liquidity Provider pursuant to the provisions of
Articles II and III hereof shall not be effective until received by the
Liquidity Provider. A copy of all notices delivered hereunder to either
party shall in addition be delivered to each of the parties to the
Participation Agreements at their respective addresses set forth therein.
Section 7.03. No Waiver; Remedies. No failure on the part of
the Liquidity Provider to exercise, and no delay in exercising, any right
under this Agreement shall operate as a waiver thereof; nor shall any
single or partial exercise of any right under this Agreement preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
Section 7.04. Further Assurances. The Borrower agrees to do
such further acts and things and to execute and deliver to the Liquidity
Provider such additional assignments, agreements, powers and instruments as
the Liquidity Provider may reasonably require or deem advisable to carry
into effect the purposes of this Agreement and the other Operative
Agreements or to better assure and confirm unto the Liquidity Provider its
rights, powers and remedies hereunder and under the other Operative
Agreements.
Section 7.05. Indemnification; Survival of Certain
Provisions. The Liquidity Provider shall be indemnified hereunder to the
extent and in the manner described in Section 6(c) or 6(b), as the case may
be, of the Participation Agreements. In addition, the Borrower agrees to
indemnify, protect, defend and hold harmless the Liquidity Provider from,
against and in respect of, and shall pay on demand, all Expenses of any
kind or nature whatsoever (other than any Expenses of the nature described
in Section 3.01, 3.02 or 7.07 hereof or in the Fee Letter (regardless of
whether indemnified against pursuant to said Sections or in such Fee
Letter)), that may be imposed, incurred by or asserted against any
Liquidity Indemnitee, in any way relating to, resulting from, or arising
out of or in connection with any action, suit or proceeding by any third
party against such Liquidity Indemnitee and relating to this Agreement, the
Fee Letter, the Intercreditor Agreement or any Financing Agreement;
provided, however, that the Borrower shall not be required to indemnify,
protect, defend and hold harmless any Liquidity Indemnitee in respect of
any Expense of such Liquidity Indemnitee to the extent such Expense is (i)
attributable to the gross negligence or willful misconduct of such
Liquidity Indemnitee or any other Liquidity Indemnitee, (ii) ordinary and
usual operating overhead expense, or (iii) attributable to the failure by
such Liquidity Indemnitee or any other Liquidity Indemnitee to perform or
observe any agreement, covenant or condition on its part to be performed or
observed in this Agreement, the Intercreditor Agreement, the Fee Letter or
any other Operative Agreement to which it is a party. The indemnities
contained in Section 6(c) or 6(b), as the case may be, of the Participation
Agreements, and the provisions of Sections 3.01, 3.02, 3.03, 3.09, 7.05 and
7.07 hereof, shall survive the termination of this Agreement.
Section 7.06. Liability of the Liquidity Provider. (a)
Neither the Liquidity Provider nor any of its officers, employees,
directors or Affiliates shall be liable or responsible for: (i) the use
which may be made of the Advances or any acts or omissions of the Borrower
or any beneficiary or transferee in connection therewith; (ii) the
validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; or (iii) the making of
Advances by the Liquidity Provider against delivery of a Notice of
Borrowing and other documents which do not comply with the terms hereof;
provided, however, that the Borrower shall have a claim against the
Liquidity Provider, and the Liquidity Provider shall be liable to the
Borrower, to the extent of any damages suffered by the Borrower which were
the result of (A) the Liquidity Provider's willful misconduct or negligence
in determining whether documents presented hereunder comply with the terms
hereof, or (B) any breach by the Liquidity Provider of any of the terms of
this Agreement, including, but not limited to, the Liquidity Provider's
failure to make lawful payment hereunder after the delivery to it by the
Borrower of a Notice of Borrowing strictly complying with the terms and
conditions hereof.
(b) Neither the Liquidity Provider nor any of its officers,
employees, directors or Affiliates shall be liable or responsible in any
respect for (i) any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with this Agreement or any Notice of Borrowing delivered
hereunder, or (ii) any action, inaction or omission which may be taken by
it in good faith, absent willful misconduct or negligence (in which event
the extent of the Liquidity Provider's potential liability to the Borrower
shall be limited as set forth in the immediately preceding paragraph), in
connection with this Agreement or any Notice of Borrowing.
Section 7.07. Costs, Expenses and Taxes. The Borrower agrees
to pay, or cause to be paid (A) on the Effective Date and on such later
date or dates on which the Liquidity Provider shall make demand, all
reasonable out-of-pocket costs and expenses (including, without limitation,
the reasonable fees and expenses of outside counsel for the Liquidity
Provider) of the Liquidity Provider in connection with the preparation,
negotiation, execution, delivery, filing and recording of this Agreement,
any other Operative Agreement and any other documents which may be
delivered in connection with this Agreement and (B) on demand, all
reasonable costs and expenses (including reasonable counsel fees and
expenses) of the Liquidity Provider in connection with (i) the enforcement
of this Agreement or any other Operative Agreement, (ii) the modification
or amendment of, or supplement to, this Agreement or any other Operative
Agreement or such other documents which may be delivered in connection
herewith or therewith (whether or not the same shall become effective) or
(iii) any action or proceeding relating to any order, injunction, or other
process or decree restraining or seeking to restrain the Liquidity Provider
from paying any amount under this Agreement, the Intercreditor Agreement or
any other Operative Agreement or otherwise affecting the application of
funds in the Class B Cash Collateral Account. In addition, the Borrower
shall pay any and all recording, stamp and other similar taxes and fees
payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, any other Operative
Agreement and such other documents, and agrees to save the Liquidity
Provider harmless from and against any and all liabilities with respect to
or resulting from any delay in paying or omission to pay such taxes or
fees.
Section 7.08. Binding Effect; Participations. (a) This
Agreement shall be binding upon and inure to the benefit of the Borrower
and the Liquidity Provider and their respective successors and assigns,
except that neither the Liquidity Provider (except as otherwise provided in
this Section 7.08) nor (except as contemplated by Section 3.08) the
Borrower shall have the right to assign its rights or obligations hereunder
or any interest herein without the prior written consent of the other
party, subject to the requirements of Section 7.08(b). The Liquidity
Provider may grant participations herein or in any of its rights hereunder
(including, without limitation, funded participations and participations in
rights to receive interest payments hereunder) and under the other
Operative Agreements to such Persons (other than US Airways or any of its
affiliates) as the Liquidity Provider may in its sole discretion select,
subject to the requirements of Section 7.08(b). No such participation by
the Liquidity Provider, however, will relieve the Liquidity Provider of its
obligations hereunder. In connection with any participation or any proposed
participation, the Liquidity Provider may disclose to the participant or
the proposed participant any information that the Borrower is required to
deliver or to disclose to the Liquidity Provider pursuant to this
Agreement. The Borrower acknowledges and agrees that the Liquidity
Provider's source of funds may derive in part from its participants.
Accordingly, references in this Agreement and the other Operative
Agreements to determinations, reserve and capital adequacy requirements,
increased costs, reduced receipts, additional amounts due pursuant to
Section 3.03(a) and the like as they pertain to the Liquidity Provider
shall be deemed also to include those of each of its participants that are
banks (subject, in each case, if any such participant is not a bank that is
(i) organized under the laws of the United States or any State thereof and
(ii) a member bank of the Federal Reserve System with deposits exceeding
$1,000,000,000 (such a bank, a "Reference Bank"), to the maximum amount
that would have been directly incurred by any Reference Bank organized
under the laws of the United States or any State thereof if such Reference
Bank, rather than the participant, had held the interest participated).
(b) If, pursuant to subsection (a) above, the Liquidity
Provider sells any participation in this Agreement to any bank or other
entity (each, a "Transferee"), then, concurrently with the effectiveness of
such participation, the Transferee shall (i) represent to the Liquidity
Provider (for the benefit of the Liquidity Provider and the Borrower)
either (A) that it is incorporated under the laws of the United States or a
state thereof or (B) that under applicable law and treaties, no taxes will
be required to be withheld with respect to any payments to be made to such
Transferee in respect of this Agreement, (ii) furnish to the Liquidity
Provider and the Borrower either (x) a statement that it is incorporated
under the laws of the United States or a state thereof or (y) if it is not
so incorporated, two copies of a properly completed United States Internal
Revenue Service Form W-8ECI or Form W-8BEN, as appropriate, or other
applicable form, certificate or document prescribed by the Internal Revenue
Service certifying, in each case, such Transferee's entitlement to a
complete exemption from United States federal withholding tax in respect to
any and all payments to be made hereunder, and (iii) agree (for the benefit
of the Liquidity Provider and the Borrower) to provide the Liquidity
Provider and the Borrower a new Form W-8ECI or Form W-8BEN, as appropriate,
(A) on or before the date that any such form expires or becomes obsolete or
(B) after the occurrence of any event requiring a change in the most recent
form previously delivered by it and prior to the immediately following due
date of any payment by the Borrower hereunder, certifying in the case of a
Form W-8BEN or Form W- 8ECI that such Transferee is entitled to a complete
exemption from United States federal withholding tax on payments under this
Agreement. Unless the Borrower has received forms or other documents
reasonably satisfactory to it (and required by applicable law) indicating
that payments hereunder are not subject to United States federal
withholding tax, the Borrower will withhold taxes as required by law from
such payments at the applicable statutory rate.
(c) Notwithstanding the other provisions of this Section
7.08, the Liquidity Provider may assign and pledge all or any portion of
the Advances owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued
by such Federal Reserve Bank, provided that any payment in respect of such
assigned Advances made by the Borrower to the Liquidity Provider in
accordance with the terms of this Agreement shall satisfy the Borrower's
obligations hereunder in respect of such assigned Advance to the extent of
such payment. No such assignment shall release the Liquidity Provider from
its obligations hereunder.
Section 7.09. Severability. Any provision of this Agreement
which is prohibited, unenforceable or not authorized in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition, unenforceability or non-authorization without invalidating the
remaining provisions hereof or affecting the validity, enforceability or
legality of such provision in any other jurisdiction.
Section 7.10. GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK.
Section 7.11. Submission to Jurisdiction; Waiver of Jury
Trial; Waiver of Immunity. (a) Each of the parties hereto hereby
irrevocably and unconditionally:
(i) submits for itself and its property in any legal
action or proceeding relating to this Agreement or
any other Operative Agreement, or for recognition
and enforcement of any judgment in respect hereof or
thereof, to the nonexclusive general jurisdiction of
the courts of the State of New York, the courts of
the United States of America for the Southern
District of New York, and the appellate courts from
any thereof;
(ii) consents that any such action or proceeding may be
brought in such courts, and waives any objection
that it may now or hereafter have to the venue of
any such action or proceeding in any such court or
that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim
the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof
by registered or certified mail (or any
substantially similar form of mail), postage
prepaid, to each party hereto at its address set
forth in Section 7.02 hereof, or at such other
address of which the Liquidity Provider shall have
been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner
permitted by law or shall limit the right to sue in
any other jurisdiction.
(b) THE BORROWER AND THE LIQUIDITY PROVIDER EACH HEREBY
AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE
RELATIONSHIP THAT IS BEING ESTABLISHED, including, without limitation,
contract claims, tort claims, breach of duty claims and all other common
law and statutory claims. The Borrower and the Liquidity Provider each
warrant and represent that it has reviewed this waiver with its legal
counsel, and that it knowingly and voluntarily waives its jury trial rights
following consultation with such legal counsel. THIS WAIVER IS IRREVOCABLE,
AND CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS AGREEMENT.
(c) The Liquidity Provider hereby waives any immunity it may
have from the jurisdiction of the courts of the United States or of any
State and waives any immunity any of its properties located in the United
States may have from attachment or execution upon a judgment entered by any
such court under the United States Foreign Sovereign Immunities Act of 1976
or any similar successor legislation.
Section 7.12. Execution in Counterparts. This Agreement may
be executed in any number of counterparts and by different parties hereto
on separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
Section 7.13. Entirety. This Agreement, the Intercreditor
Agreement and the other Operative Agreements to which the Liquidity
Provider is a party constitute the entire agreement of the parties hereto
with respect to the subject matter hereof and supersedes all prior
understandings and agreements of such parties.
Section 7.14. Headings. Section headings in this Agreement
are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE
ADVANCES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OBLIGATIONS
OF THE LIQUIDITY PROVIDER TO MAKE ADVANCES HEREUNDER, AND THE BORROWER'S
RIGHTS TO DELIVER NOTICES OF BORROWING REQUESTING THE MAKING OF ADVANCES
HEREUNDER, SHALL BE UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID OR
PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed and delivered by their respective officers thereunto
duly authorized as of the date first
set forth above.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely as
Subordination Agent, as agent and trustee
for the Class B Trust, as Borrower
By: /s/ Julie A. Balerna
___________________________________
Name: Julie A. Balerna
Title: Assistant Vice President
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
By: /s/ Colum Carr
___________________________________
Name: Colum Carr
Title: Vice President
Annex I to Revolving Credit Agreement
INTEREST ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1B) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of an Interest Advance by the Liquidity Provider to be
used, subject to clause (3)(v) below, for the payment of the
interest on the Class B Certificates which was payable on
____________, ____ (the "Distribution Date") in accordance with the
terms and provisions of the Class B Trust Agreement and the Class B
Certificates, which Advance is requested to be made on
____________, ____.
(3) The amount of the Interest Advance requested hereby (i)
is $_______________.__, to be applied in respect of the payment of
the interest which was due and payable on the Class B Certificates
on the Distribution Date, (ii) does not include any amount with
respect to the payment of principal of, or premium on, the Class A
Certificates, the Class B Certificates or the Class C Certificates,
or interest on the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class B Certificates, the Class B Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), (iv) does not exceed the Maximum Available
Commitment on the date hereof, (v) does not include any amount of
interest which was due and payable on the Class B Certificates on
such Distribution Date but which remains unpaid due to the failure
of the Depositary to pay any amount of accrued interest on the
Deposits on such Distribution Date and (vi) has not been and is not
the subject of a prior or contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will apply the same in
accordance with the terms of Section 3.6(b) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, the making of the Interest Advance as requested by
this Notice of Borrowing shall automatically reduce, subject to
reinstatement in accordance with the terms of the Liquidity Agreement, the
Maximum Available Commitment by an amount equal to the amount of the
Interest Advance requested to be made hereby as set forth in clause (i) of
paragraph (3) of this Certificate and such reduction shall automatically
result in corresponding reductions in the amounts available to be borrowed
pursuant to a subsequent Advance.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with Interest Advance Notice
of Borrowing]
Annex II to
Revolving Credit Agreement
NON-EXTENSION ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1B) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of the Non-Extension Advance by the Liquidity Provider
to be used for the funding of the Class B Cash Collateral Account
in accordance with Section 3.6(d) of the Intercreditor Agreement,
which Advance is requested to be made on __________, ____.
(3) The amount of the Non-Extension Advance requested hereby
(i) is $_______________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of
the funding of the Class B Cash Collateral Account in accordance
with Section 3.6(d) of the Intercreditor Agreement, (ii) does not
include any amount with respect to the payment of the principal of,
or premium on, the Class B Certificates, or principal of, or
interest or premium on, the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class B Certificates, the Class B Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), and (iv) has not been and is not the subject
of a prior or contemporaneous Notice of Borrowing under the
Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will deposit such amount
in the Class B Cash Collateral Account and apply the same in
accordance with the terms of Section 3.6(d) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice]1.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Non-Extension Advance as
requested by this Notice of Borrowing shall automatically and irrevocably
terminate the obligation of the Liquidity Provider to make further Advances
under the Liquidity Agreement; and (B) following the making by the
Liquidity Provider of the Non-Extension Advance requested by this Notice of
Borrowing, the Borrower shall not be entitled to request any further
Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
- -------------------
1 Bracketed language may be included at Borrower's option.
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with Non-Extension Advance
Notice of Borrowing]
Annex III to
Revolving Credit Agreement
DOWNGRADE ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1B) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of the Downgrade Advance by the Liquidity Provider to be
used for the funding of the Class B Cash Collateral Account in
accordance with Section 3.6(c) of the Intercreditor Agreement by
reason of the downgrading of the short-term unsecured debt rating
of the Liquidity Provider issued by either Rating Agency below the
Threshold Rating, which Advance is requested to be made on
__________, ____.
(3) The amount of the Downgrade Advance requested hereby (i)
is $_______________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of
the funding of the Class B Cash Collateral Account in accordance
with Section 3.6(c) of the Intercreditor Agreement, (ii) does not
include any amount with respect to the payment of the principal of,
or premium on, the Class B Certificates, or principal of, or
interest or premium on, the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class B Certificates, the Class B Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), and (iv) has not been and is not the subject
of a prior or contemporaneous Notice of Borrowing under the
Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will deposit such amount
in the Class B Cash Collateral Account and apply the same in
accordance with the terms of Section 3.6(c) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice]2.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Downgrade Advance as requested
by this Notice of Borrowing shall automatically and irrevocably terminate
the obligation of the Liquidity Provider to make further Advances under the
Liquidity Agreement; and (B) following the making by the Liquidity Provider
of the Downgrade Advance requested by this Notice of Borrowing, the
Borrower shall not be entitled to request any further Advances under the
Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
- -------------------
2 Bracketed language may be included at Borrower's option.
SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with Downgrade Advance Notice
of Borrowing]
Annex IV to
Revolving Credit Agreement
FINAL ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the
undersigned borrower (the "Borrower"), hereby certifies to AIG MATCHED
FUNDING CORP. (the "Liquidity Provider"), with reference to the Revolving
Credit Agreement (1999-1B) dated as of August 31, 1999, between the
Borrower and the Liquidity Provider (the "Liquidity Agreement"; the terms
defined therein and not otherwise defined herein being used herein as
therein defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for
the making of the Final Advance by the Liquidity Provider to be
used for the funding of the Class B Cash Collateral Account in
accordance with Section 3.6(i) of the Intercreditor Agreement by
reason of the receipt by the Borrower of a Termination Notice from
the Liquidity Provider with respect to the Liquidity Agreement,
which Advance is requested to be made on ____________, ____.
(3) The amount of the Final Advance requested hereby (i) is
$_________________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of
the funding of the Class B Cash Collateral Account in accordance
with Section 3.6(i) of the Intercreditor Agreement, (ii) does not
include any amount with respect to the payment of principal of, or
premium on, the Class B Certificates, or principal of, or interest
or premium on, the Class A Certificates or the Class C
Certificates, (iii) was computed in accordance with the provisions
of the Class B Certificates, the Class B Trust Agreement and the
Intercreditor Agreement (a copy of which computation is attached
hereto as Schedule I), and (iv) has not been and is not the subject
of a prior or contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the
amount requested hereby, (a) the Borrower will deposit such amount
in the Class B Cash Collateral Account and apply the same in
accordance with the terms of Section 3.6(i) of the Intercreditor
Agreement, (b) no portion of such amount shall be applied by the
Borrower for any other purpose and (c) no portion of such amount
until so applied shall be commingled with other funds held by the
Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice]3.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Final Advance as requested by
this Notice of Borrowing shall automatically and irrevocably terminate the
obligation of the Liquidity Provider to make further Advances under the
Liquidity Agreement; and (B) following the making by the Liquidity Provider
of the Final Advance requested by this Notice of Borrowing, the Borrower
shall not be entitled to request any further Advances under the Liquidity
Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
- -------------------
3 Bracketed language may be included at Borrower's option.
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with Final Advance Notice
of Borrowing]
Annex V to
Revolving Credit Agreement
NOTICE OF TERMINATION
[Date]
State Street Bank and Trust Company of Connecticut,
National Association,
as Subordination Agent, as Borrower
225 Asylum Street
Goodwyn Square
Hartford, CT 06103
Attention: Corporate Trust Administration
Revolving Credit Agreement dated as of August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, as agent and
trustee for the US Airways Pass Through Trust, 1999-1B, as
Borrower, and AIG MATCHED FUNDING CORP. (the "Liquidity
Agreement")
Ladies and Gentlemen:
You are hereby notified that pursuant to Section 6.01 of the
Liquidity Agreement, by reason of the occurrence of a Liquidity Event of
Default and the existence of a Performing Note Deficiency (each as defined
therein), we are giving this notice to you in order to cause (i) our
obligations to make Advances (as defined therein) under such Liquidity
Agreement to terminate on the fifth Business Day after the date on which
you receive this notice and (ii) you to request a Final Advance under the
Liquidity Agreement pursuant to Section 3.6(i) of the Intercreditor
Agreement (as defined in the Liquidity Agreement) as a consequence of your
receipt of this notice.
THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR
UNDER THE LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES
UNDER THE LIQUIDITY AGREEMENT WILL TERMINATE ON THE FIFTH BUSINESS DAY
AFTER THE DATE ON WHICH YOU RECEIVE THIS NOTICE.
Very truly yours,
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
By:_______________________________
Name:
Title:
cc: State Street Bank and Trust Company of Connecticut, National
Association, as Class B Trustee
Annex VI to
Revolving Credit Agreement
NOTICE OF REPLACEMENT SUBORDINATION AGENT
[Date]
Attention:
Revolving Credit Agreement dated as of August 31, 1999, between
State Street Bank and Trust Company of Connecticut, National
Association, as Subordination Agent, as agent and trustee for the
US Airways Pass Through Trust, 1999-1B, as Borrower, and AIG
MATCHED FUNDING CORP. (the "Liquidity Agreement")
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby irrevocably
transfers to:
------------------------------
[Name of Transferee]
------------------------------
[Address of Transferee]
all rights and obligations of the undersigned as Borrower under the
Liquidity Agreement referred to above. The transferee has succeeded the
undersigned as Subordination Agent under the Intercreditor Agreement
referred to in the first paragraph of the Liquidity Agreement, pursuant to
the terms of Section 8.1 of the Intercreditor Agreement.
By this transfer, all rights of the undersigned as Borrower
under the Liquidity Agreement are transferred to the transferee and the
transferee shall hereafter have the sole rights and obligations as Borrower
thereunder. The undersigned shall pay any costs and expenses of such
transfer, including, but not limited to, transfer taxes or governmental
charges.
We ask that this transfer be effective as of
_______________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Subordination Agent, as Borrower
By:___________________________________
Name:
Title:
By:___________________________________
Name:
Title:
Exhibit 4(a)(viii)
-----------------------------------------------------------------
REVOLVING CREDIT AGREEMENT
(1999-1C)
Dated as of August 31, 1999
between
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Subordination Agent,
as agent and trustee for the
US Airways Pass Through Trust 1999-1C
as Borrower
and
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
-----------------------------------------------------------------
Relating to
US Airways Pass Through Trust 1999-1C
7.96% US Airways Pass Through Certificates,
Series 1999-1C
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS......................................................1
Section 1.01 Certain Defined Terms......................................1
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENT..............................6
Section 2.01 The Advances...............................................6
Section 2.02 Making the Advances........................................7
Section 2.03 Fees.......................................................9
Section 2.04 Reductions or Termination of the Maximum Commitment........9
Section 2.05 Repayments of Interest Advances or the Final Advance.......9
Section 2.06 Repayments of Provider Advances............................9
Section 2.07 Payments to the Liquidity Provider Under the
Intercreditor Agreement.................................10
Section 2.08 Book Entries..............................................11
Section 2.09 Payments from Available Funds Only........................11
Section 2.10 Extension of the Expiry Date; Non-Extension Advance.......11
ARTICLE III OBLIGATIONS OF THE BORROWER...................................12
Section 3.01 Increased Costs...........................................12
Section 3.02 Capital Adequacy..........................................13
Section 3.03 Payments Free of Deductions...............................14
Section 3.04 Payments..................................................14
Section 3.05 Computations..............................................14
Section 3.06 Payment on Non-Business Days..............................14
Section 3.07 Interest..................................................15
Section 3.08 Replacement of Borrower...................................16
Section 3.09 Funding Loss Indemnification..............................16
Section 3.10 Illegality................................................17
ARTICLE IV CONDITIONS PRECEDENT...........................................17
Section 4.01 Conditions Precedent to Effectiveness of Section 2.01.....17
Section 4.02 Conditions Precedent to Borrowing.........................19
ARTICLE V COVENANTS.......................................................19
Section 5.01 Affirmative Covenants of the Borrower.....................19
Section 5.02 Negative Covenants of the Borrower........................20
ARTICLE VI LIQUIDITY EVENTS OF DEFAULT....................................20
Section 6.01 Liquidity Events of Default...............................20
ARTICLE VII MISCELLANEOUS.................................................20
Section 7.01 Amendments, Etc...........................................20
Section 7.02 Notices, Etc..............................................20
Section 7.03 No Waiver; Remedies.......................................22
Section 7.04 Further Assurances........................................22
Section 7.05 Indemnification; Survival of Certain Provisions...........22
Section 7.06 Liability of the Liquidity Provider.......................22
Section 7.07 Costs, Expenses and Taxes.................................23
Section 7.08 Binding Effect; Participations............................24
Section 7.09 Severability..............................................25
Section 7.10 GOVERNING LAW.............................................25
Section 7.11 Submission to Jurisdiction; Waiver of Jury Trial;
Waiver of Immunity......................................25
Section 7.12 Execution in Counterparts.................................26
Section 7.13 Entirety..................................................26
Section 7.14 Headings..................................................26
Section 7.15 LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES..........27
ANNEX I Interest Advance Notice of Borrowing
ANNEX II Non-Extension Advance Notice of Borrowing
ANNEX III Downgrade Advance Notice of Borrowing
ANNEX IV Final Advance Notice of Borrowing
ANNEX V Notice of Termination
ANNEX VI Notice of Replacement Subordination Agent
REVOLVING CREDIT AGREEMENT (1999-1C)
This REVOLVING CREDIT AGREEMENT (1999-1C) dated as of August
31, 1999, between STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, a national banking association, not in its individual
capacity but solely as Subordination Agent under the Intercreditor
Agreement (each as defined below), as agent and trustee for the Class C
Trust (as defined below) (the "Borrower"), and AIG MATCHED FUNDING CORP., a
corporation organized under the laws of the State of Delaware (the
"Liquidity Provider").
W I T N E S S E T H:
WHEREAS, pursuant to the Class C Trust Agreement (such term and
all other capitalized terms used in these recitals having the meanings set
forth or referred to in Section 1.01), the Class C Trust is issuing the
Class C Certificates; and
WHEREAS, the Borrower, in order to support the timely payment
of a portion of the interest on the Class C Certificates in accordance with
their terms, has requested the Liquidity Provider to enter into this
Agreement, providing in part for the Borrower to request in specified
circumstances that Advances be made hereunder.
NOW, THEREFORE, in consideration of the premises, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Certain Defined Terms.
(a) Definitions. As used in this Agreement and unless otherwise
expressly indicated, or unless the context clearly requires otherwise, the
following capitalized terms shall have the following respective meanings
for all purposes of this Agreement:
"Additional Cost" has the meaning assigned to such term in
Section 3.01.
"Advance" means an Interest Advance, a Final Advance, a
Provider Advance, an Applied Provider Advance or an Unpaid Advance, as the
case may be.
"Applicable Liquidity Rate" has the meaning assigned to such
term in Section 3.07(g).
"Applicable Margin" means (x) with respect to any Unpaid
Advance or Applied Provider Advance, 1.75%, (y) with respect to any
Unapplied Provider Advance, the rate per annum specified in the Fee Letter.
"Applied Downgrade Advance" has the meaning assigned to such
term in Section 2.06(a).
"Applied Non-Extension Advance" has the meaning assigned to
such term in Section 2.06(a).
"Applied Provider Advance" has the meaning assigned to such
term in Section 2.06(a).
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be equal
to (a) the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by the Liquidity Provider from three Federal funds
brokers of recognized standing selected by it, plus (b) one quarter of one
percent (1/4 of 1%) per annum.
"Base Rate Advance" means an Advance that bears interest at a
rate based upon the Base Rate.
"Borrower" has the meaning assigned to such term in the recital
of parties to this Agreement.
"Borrowing" means the making of Advances requested by delivery
of a Notice of Borrowing.
"Business Day" means any day other than a Saturday or Sunday or
a day on which commercial banks are required or authorized to close in New
York, New York, Pittsburgh, Pennsylvania, or, so long as any Class C
Certificate is outstanding, the city and state in which the Class C
Trustee, the Borrower or any Loan Trustee maintains its Corporate Trust
Office or receives or disburses funds, and, if the applicable Business Day
relates to any Advance or other amount bearing interest based on the LIBOR
Rate, on which dealings are carried on in the London interbank market.
"Deposits" has the meaning assigned to such terms in the
Deposit Agreement.
"Depositary" has the meaning assigned to such term in the
Deposit Agreement.
"Deposit Agreement" means the Deposit Agreement dated as of the
date hereof between First Security Bank, National Association, as Escrow
Agent and ABN AMRO Bank, N.V., acting through its Chicago branch, as
Depositary, pertaining to the Class C Certificates, as the same may be
amended, modified or supplemented from time to time in accordance with the
terms thereof.
"Downgrade Advance" means an Advance made pursuant to Section
2.02(c).
"Effective Date" has the meaning specified in Section 4.01. The
delivery of the certificate of the Liquidity Provider contemplated by
Section 4.01(e) shall be conclusive evidence that the Effective Date has
occurred.
"Excluded Taxes" means (i) taxes imposed on the overall net
income of the Liquidity Provider or of its Facility Office by the
jurisdiction where such Liquidity Provider's principal office or such
Facility Office is located, and (ii) Excluded Withholding Taxes.
"Excluded Withholding Taxes" means (i) withholding Taxes
imposed by the United States except to the extent that such United States
withholding Taxes are imposed as a result of any change in applicable law
(excluding from change in applicable law for this purpose a change in an
applicable treaty or other change in law affecting the applicability of a
treaty) after the date hereof, or in the case of a successor Liquidity
Provider (including a transferee of an Advance) or Facility Office, after
the date on which such successor Liquidity Provider obtains its interest or
on which the Facility Office is changed, and (ii) any withholding Taxes
imposed by the United States which are imposed or increased as a result of
the Liquidity Provider failing to deliver to the Borrower any certificate
or document (which certificate or document in the good faith judgment of
the Liquidity Provider it is legally entitled to provide) which is
reasonably requested by the Borrower to establish that payments under this
Agreement are exempt from (or entitled to a reduced rate of) withholding
Tax.
"Expenses" means liabilities, obligations, damages,
settlements, penalties, claims, actions, suits, costs, expenses, and
disbursements (including, without limitation, reasonable fees and
disbursements of legal counsel and costs of investigation), provided that
Expenses shall not include any Taxes.
"Expiry Date" means August 28, 2000, initially, or any date to
which the Expiry Date is extended pursuant to Section 2.10.
"Facility Office" means the Facility Office of the Liquidity
Provider presently located at Westport, Connecticut, or such other Facility
Office as the Liquidity Provider from time to time shall notify the
Borrower as its Facility Office hereunder; provided that the Liquidity
Provider shall not change its Facility Office to a Facility Office outside
the United States of America except in accordance with Section 3.01, 3.02
or 3.03 hereof.
"Final Advance" means an Advance made pursuant to Section
2.02(d).
"Intercreditor Agreement" means the Intercreditor Agreement
dated the date hereof, among the Trustees, the Liquidity Provider, the
liquidity provider under each Liquidity Facility (other than this
Agreement) and the Subordination Agent, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Interest Advance" means an Advance made pursuant to Section
2.02(a).
"Interest Period" means, with respect to any LIBOR Advance,
each of the following periods:
(i) the period beginning on the third Business Day following
either (x) the Liquidity Provider's receipt of the Notice
of Borrowing for such LIBOR Advance or (y) the date of
the withdrawal of funds from the Class C Cash Collateral
Account for the purpose of paying interest on the Class C
Certificates as contemplated by Section 2.06(a) hereof
and, in either case, ending on the next Regular
Distribution Date; and
(ii) each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the
next Regular Distribution Date;
provided, however, that if (x) the Final Advance shall have
been made, or (y) other outstanding Advances shall have been
converted into the Final Advance, then the Interest Periods
shall be successive periods of one month beginning on the third
Business Day following the Liquidity Provider's receipt of the
Notice of Borrowing for such Final Advance (in the case of
clause (x) above) or the Regular Distribution Date following
such conversion (in the case of clause (y) above).
"LIBOR Advance" means an Advance bearing interest at a rate
based upon the LIBOR Rate.
"LIBOR Rate" means, with respect to any Interest Period:
(i) the rate per annum appearing on display page 3750
(British Bankers Association-LIBOR) of the Dow Jones
Markets Service (or any successor or substitute therefor
) at approximately 11:00 A.M. (London time) two Business
Days before the first day of such Interest Period, as the
rate for dollar deposits with a maturity comparable to
such Interest Period, or
(ii) if the rate calculated pursuant to clause (i) above is
not available, the average (rounded upwards, if
necessary, to the next 1/16 of 1%) of the rates per annum
at which deposits in dollars are offered for the relevant
Interest Period by three banks of recognized standing
selected by the Liquidity Provider in the London
interbank market at approximately 11:00 A.M. (London
time) two Business Days before the first day of such
Interest Period in an amount approximately equal to the
principal amount of the LIBOR Advance to which such
Interest Period is to apply and for a period comparable
to such Interest Period.
"Liquidity Event of Default" means the occurrence of either (a)
the Acceleration of all of the Equipment Notes (provided that, with respect
to the period prior to the Delivery Period Expiry Date, such Equipment
Notes have an aggregate outstanding principal balance in excess of
$300,000,000) or (b) a US Airways Bankruptcy Event.
"Liquidity Indemnitee" means (i) the Liquidity Provider, (ii)
the directors, officers, employees and agents of the Liquidity Provider,
and (iii) the successors and permitted assigns of the persons described in
clauses (i) and (ii), inclusive.
"Liquidity Provider" has the meaning assigned to such term in
the recital of parties to this Agreement.
"Maximum Available Commitment" shall mean, subject to the
proviso contained in the third sentence of Section 2.02(a), at any time of
determination, (a) the Maximum Commitment at such time less (b) the
aggregate amount of each Interest Advance outstanding at such time;
provided that following a Provider Advance or a Final Advance, the Maximum
Available Commitment shall be zero.
"Maximum Commitment" means initially $14,509,129.80, as the
same may be reduced from time to time in accordance with Section 2.04(a).
"Non-Excluded Tax" has the meaning specified in Section 3.03.
"Non-Extension Advance" means an Advance made pursuant to
Section 2.02(b).
"Notice of Borrowing" has the meaning specified in Section
2.02(e).
"Notice of Replacement Subordination Agent" has the meaning
specified in Section 3.08.
"Performing Note Deficiency" means any time that less than 65%
of the then aggregate outstanding principal amount of all Equipment Notes
are Performing Equipment Notes.
"Prospectus Supplement" means the Prospectus Supplement dated
August 24, 1999 relating to the Class A Certificates and the Class B
Certificates, as such Prospectus Supplement may be amended or supplemented.
"Provider Advance" means a Downgrade Advance or a Non-Extension
Advance.
"Regulatory Change" has the meaning assigned to such term in
Section 3.01.
"Replenishment Amount" has the meaning assigned to such term in
Section 2.06(b).
"Required Amount" means, for any day, the sum of the aggregate
amount of interest, calculated at the rate per annum equal to the Stated
Interest Rate for the Class C Certificates, that would be payable on the
Class C Certificates on each of the three successive semiannual Regular
Distribution Dates immediately following such day or, if such day is a
Regular Distribution Date, on such day and the succeeding two semiannual
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of the Class C Certificates on such day and without regard to
expected future payments of principal on the Class C Certificates.
"Termination Date" means the earliest to occur of the
following: (i) the Expiry Date; (ii) the date on which the Borrower
delivers to the Liquidity Provider a certificate, signed by a Responsible
Officer of the Borrower, certifying that all of the Class C Certificates
have been paid in full (or provision has been made for such payment in
accordance with the Intercreditor Agreement and the Trust Agreements) or
are otherwise no longer entitled to the benefits of this Agreement; (iii)
the date on which the Borrower delivers to the Liquidity Provider a
certificate, signed by a Responsible Officer of the Borrower, certifying
that a Replacement Liquidity Facility has been substituted for this
Agreement in full pursuant to Section 3.6(e) of the Intercreditor
Agreement; (iv) the fifth Business Day following the receipt by the
Borrower of a Termination Notice from the Liquidity Provider pursuant to
Section 6.01 hereof; and (v) the date on which no Advance is or may
(including by reason of reinstatement as herein provided) become available
for a Borrowing hereunder.
"Termination Notice" means the Notice of Termination
substantially in the form of Annex V to this Agreement.
"Transferee" has the meaning assigned to such term in Section
7.08(b).
"Unapplied Downgrade Advance" means any Downgrade Advance other
than an Applied Downgrade Advance.
"Unapplied Provider Advance" means any Provider Advance other
than an Applied Provider Advance.
"Unpaid Advance" has the meaning assigned to such term in
Section 2.05.
(b) Terms Defined in the Intercreditor Agreement. For all
purposes of this Agreement, the following terms shall have the respective
meanings assigned to such terms in the Intercreditor Agreement:
"Acceleration", "AIFS", "Certificates", "Class A Certificates",
"Class B Certificates", Class C Cash Collateral Account", "Class C
Certificateholders", "Class C Certificates", "Class C Purchase Agreement",
"Class C Trust", "Class C Trust Agreement", "Class C Trustee", "Closing
Date", "Controlling Party", "Corporate Trust Office", "Delivery Period
Expiry Date", "Distribution Date", "Downgraded Facility", "Equipment
Notes", "Fee Letter", "Final Legal Distribution Date", "Financing
Agreement", "Indenture", "Interest Payment Date", "Investment Earnings",
"Leased Aircraft", "Liquidity Facility", "Liquidity Obligations", "Loan
Trustee", "Moody's", "Non-Extended Facility", "Note Purchase Agreement",
"Operative Agreements", "Owned Aircraft", "Participation Agreement",
"Performing Equipment Note", "Person", "Pool Balance", "Rating Agency",
"Ratings Confirmation", "Regular Distribution Date", "Replacement Liquidity
Facility", "Responsible Officer", "Scheduled Payment", "Special Payment",
"Standard & Poor's", "Stated Interest Rate", "Subordination Agent",
"Taxes", "Threshold Rating", "Trust Agreements", "Trustee", "Underwriters",
"Underwriting Agreement", "US Airways", "US Airways Bankruptcy Event" and
"Written Notice".
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENT
Section 2.01. The Advances.
The Liquidity Provider hereby irrevocably agrees, on the terms
and conditions hereinafter set forth, to make Advances to the Borrower from
time to time on any Business Day during the period from the Effective Date
until 12:00 Noon (New York City time) on the Expiry Date (unless the
obligations of the Liquidity Provider shall be earlier terminated in
accordance with the terms of Section 2.04(b)) in an aggregate amount at any
time outstanding not to exceed the Maximum Commitment.
Section 2.02. Making the Advances.
(a) Interest Advances shall be made in one or more Borrowings
by delivery to the Liquidity Provider of one or more written and completed
Notices of Borrowing in substantially the form of Annex I attached hereto,
signed by a Responsible Officer of the Borrower, in an amount not exceeding
the Maximum Available Commitment at such time and shall be used solely for
the payment when due of interest on the Class C Certificates at the Stated
Interest Rate therefor in accordance with Section 3.6(a) of the
Intercreditor Agreement. Each Interest Advance made hereunder shall
automatically reduce the Maximum Available Commitment and the amount
available to be borrowed hereunder by subsequent Advances by the amount of
such Interest Advance (subject to reinstatement as provided in the next
sentence). Upon repayment to the Liquidity Provider of all or any part of
the amount of any Interest Advance made pursuant to this Section 2.02(a),
together with accrued interest thereon (as provided herein), the Maximum
Available Commitment shall be reinstated by the amount of such repaid
Interest Advance, but not to exceed the Maximum Commitment; provided,
however, that the Maximum Available Commitment shall not be so reinstated
at any time if (i) a Liquidity Event of Default shall have occurred and be
continuing and (ii) there is a Performing Note Deficiency.
(b) A Non-Extension Advance shall be made in a single Borrowing
if this Agreement is not extended in accordance with Section 3.6(d) of the
Intercreditor Agreement (unless a Replacement Liquidity Facility to replace
this Agreement shall have been delivered to the Borrower as contemplated by
said Section 3.6(d) within the time period specified in such Section) by
delivery to the Liquidity Provider of a written and completed Notice of
Borrowing in substantially the form of Annex II attached hereto, signed by
a Responsible Officer of the Borrower, in an amount equal to the Maximum
Available Commitment at such time, and shall be used to fund the Class C
Cash Collateral Account in accordance with said Section 3.6(d) and Section
3.6(f) of the Intercreditor Agreement.
(c) A Downgrade Advance shall be made in a single Borrowing
upon a downgrading of the Liquidity Provider's short-term unsecured debt
rating issued by either Rating Agency below the applicable Threshold Rating
(as provided for in Section 3.6(c) of the Intercreditor Agreement) unless a
Replacement Liquidity Facility to replace this Agreement shall have been
previously delivered to the Borrower in accordance with said Section 3.6(c)
and within the time period specified in such Section, by delivery to the
Liquidity Provider of a written and completed Notice of Borrowing in
substantially the form of Annex III attached hereto, signed by a
Responsible Officer of the Borrower, in an amount equal to the Maximum
Available Commitment at such time, and shall be used to fund the Class C
Cash Collateral Account in accordance with said Section 3.6(c) and Section
3.6(f) of the Intercreditor Agreement.
(d) A Final Advance shall be made in a single Borrowing upon
the receipt by the Borrower of a Termination Notice from the Liquidity
Provider pursuant to Section 6.01 hereof by delivery to the Liquidity
Provider of a written and completed Notice of Borrowing in substantially
the form of Annex IV attached hereto, signed by a Responsible Officer of
the Borrower, in an amount equal to the Maximum Available Commitment at
such time, and shall be used to fund the Class C Cash Collateral Account in
accordance with Section 3.6(i) and Section 3.6(f) of the Intercreditor
Agreement.
(e) Each Borrowing shall be made on notice in writing (a
"Notice of Borrowing") in substantially the form required by Section
2.02(a), 2.02(b), 2.02(c) or 2.02(d), as the case may be, given by the
Borrower to the Liquidity Provider. If a Notice of Borrowing is delivered
by the Borrower in respect of any Borrowing no later than 1:00 p.m. (New
York City time) on a Business Day, upon satisfaction of the conditions
precedent set forth in Section 4.02 with respect to a requested Borrowing,
the Liquidity Provider shall make available to the Borrower, in accordance
with its payment instructions, the amount of such Borrowing in U.S. dollars
and immediately available funds, before 4:00 p.m. (New York City time) on
such Business Day or on such later Business Day specified in such Notice of
Borrowing. If a Notice of Borrowing is delivered by the Borrower in respect
of any Borrowing after 1:00 p.m. (New York City time) on a Business Day,
upon satisfaction of the conditions precedent set forth in Section 4.02
with respect to a requested Borrowing, the Liquidity Provider shall make
available to the Borrower, in accordance with its payment instructions, the
amount of such Borrowing in U.S. dollars and in immediately available
funds, before 12:00 noon (New York City time) on the first Business Day
next following the day of receipt of such Notice of Borrowing or on such
later Business Day specified by the Borrower in such Notice of Borrowing.
Payments of proceeds of a Borrowing shall be made by wire transfer of
immediately available funds to the Borrower in accordance with such wire
transfer instructions as the Borrower shall furnish from time to time to
the Liquidity Provider for such purpose. Each Notice of Borrowing shall be
irrevocable and binding on the Borrower.
(f) Upon the making of any Advance requested pursuant to a
Notice of Borrowing, in accordance with the Borrower's payment
instructions, the Liquidity Provider shall be fully discharged of its
obligation hereunder with respect to such Notice of Borrowing, and the
Liquidity Provider shall not thereafter be obligated to make any further
Advances hereunder in respect of such Notice of Borrowing to the Borrower
or to any other Person. Following the making of any Advance pursuant to
Section 2.02(b), (c) or (d) hereof to fund the Class C Cash Collateral
Account, the Liquidity Provider shall have no interest in or rights to the
Class C Cash Collateral Account, such Advance or any other amounts from
time to time on deposit in the Class C Cash Collateral Account; provided
that the foregoing shall not affect or impair the obligations of the
Subordination Agent to make the distributions contemplated by Section
3.6(e) or (f) of the Intercreditor Agreement, and provided further, that
the foregoing shall not affect or impair the rights of the Liquidity
Provider to provide written instructions with respect to the investment and
reinvestment of amounts in the Cash Collateral Accounts to the extent
provided in Section 2.2(b) of the Intercreditor Agreement. By paying to the
Borrower proceeds of Advances requested by the Borrower in accordance with
the provisions of this Agreement, the Liquidity Provider makes no
representation as to, and assumes no responsibility for, the correctness or
sufficiency for any purpose of the amount of the Advances so made and
requested.
Section 2.03. Fees.
The Borrower agrees to pay to the Liquidity Provider the fees
set forth in the Fee Letter.
Section 2.04. Reductions or Termination of the Maximum
Commitment.
(a) Automatic Reduction. Promptly following each date on which
the Required Amount is reduced as a result of a reduction in the Pool
Balance of the Class C Certificates or otherwise, the Maximum Commitment
shall automatically be reduced to an amount equal to such reduced Required
Amount (as calculated by the Borrower). The Borrower shall give notice of
any such automatic reduction of the Maximum Commitment to the Liquidity
Provider within two Business Days thereof. The failure by the Borrower to
furnish any such notice shall not affect such automatic reduction of the
Maximum Commitment.
(b) Termination. Upon the making of any Provider Advance or
Final Advance hereunder or the occurrence of the Termination Date, the
obligation of the Liquidity Provider to make further Advances hereunder
shall automatically and irrevocably terminate, and the Borrower shall not
be entitled to request any further Borrowing hereunder.
Section 2.05. Repayments of Interest Advances or the Final
Advance.
Subject to Sections 2.06, 2.07 and 2.09 hereof, the Borrower
hereby agrees, without notice of an Advance or demand for repayment from
the Liquidity Provider (which notice and demand are hereby waived by the
Borrower), to pay, or to cause to be paid, to the Liquidity Provider on
each date on which the Liquidity Provider shall make an Interest Advance or
the Final Advance, an amount equal to (a) the amount of such Advance (any
such Advance, until repaid, is referred to herein as an "Unpaid Advance"),
plus (b) interest on the amount of each such Unpaid Advance as provided in
Section 3.07 hereof; provided that if (i) the Liquidity Provider shall make
a Provider Advance at any time after making one or more Interest Advances
which shall not have been repaid in accordance with this Section 2.05 or
(ii) this Liquidity Facility shall become a Downgraded Facility or
Non-Extended Facility at any time when unreimbursed Interest Advances have
reduced the Maximum Available Commitment to zero, then such Interest
Advances shall cease to constitute Unpaid Advances and shall be deemed to
have been changed into an Applied Downgrade Advance or an Applied
Non-Extension Advance, as the case may be, for all purposes of this
Agreement (including, without limitation, for the purpose of determining
when such Interest Advance is required to be repaid to the Liquidity
Provider in accordance with Section 2.06 and for the purposes of Section
2.06(b)). The Borrower and the Liquidity Provider agree that the repayment
in full of each Interest Advance and Final Advance on the date such Advance
is made is intended to be a contemporaneous exchange for new value given to
the Borrower by the Liquidity Provider.
Section 2.06. Repayments of Provider Advances.
(a) Amounts advanced hereunder in respect of a Provider Advance
shall be deposited in the Class C Cash Collateral Account, invested and
withdrawn from the Class C Cash Collateral Account as set forth in Sections
3.6(c), (d) and (f) of the Intercreditor Agreement. The Borrower agrees to
pay to the Liquidity Provider, on each Regular Distribution Date,
commencing on the first Regular Distribution Date after the making of a
Provider Advance, interest on the principal amount of any such Provider
Advance as provided in Section 3.07 hereof; provided, however, that amounts
in respect of a Provider Advance withdrawn from the Class C Cash Collateral
Account for the purpose of paying interest on the Class C Certificates in
accordance with Section 3.6(f) of the Intercreditor Agreement (the amount
of any such withdrawal being (y) in the case of a Downgrade Advance, an
"Applied Downgrade Advance" and (z) in the case of a Non-Extension Advance,
an "Applied Non-Extension Advance" and, together with an Applied Downgrade
Advance, an "Applied Provider Advance") shall thereafter (subject to
Section 2.06(b)) be treated as an Interest Advance under this Agreement for
purposes of determining the Applicable Liquidity Rate for interest payable
thereon; provided further, however, that if, following the making of a
Provider Advance, the Liquidity Provider delivers a Termination Notice to
the Borrower pursuant to Section 6.01 hereof, such Provider Advance shall
thereafter be treated as a Final Advance under this Agreement for purposes
of determining the Applicable Liquidity Rate for interest payable thereon.
Subject to Sections 2.07 and 2.09 hereof, immediately upon the withdrawal
of any amounts from the Class C Cash Collateral Account on account of a
reduction in the Required Amount, the Borrower shall repay to the Liquidity
Provider a portion of the Provider Advances in a principal amount equal to
such reduction, plus interest on the principal amount prepaid as provided
in Section 3.07 hereof.
(b) At any time when an Applied Provider Advance (or any
portion thereof) is outstanding, upon the deposit in the Class C Cash
Collateral Account of any amount pursuant to clause "third" of Section
2.4(b) of the Intercreditor Agreement, clause "third" of Section 3.2 of the
Intercreditor Agreement or clause "fourth" of Section 3.3 of the
Intercreditor Agreement (any such amount being a "Replenishment Amount")
for the purpose of replenishing or increasing the balance thereof up to the
Required Amount at such time, (i) the aggregate outstanding principal
amount of all Applied Provider Advances (and of Provider Advances treated
as an Interest Advance for purposes of determining the Applicable Liquidity
Rate for interest payable thereon) shall be automatically reduced by the
amount of such Replenishment Amount and (ii) the aggregate outstanding
principal amount of all Unapplied Provider Advances shall be automatically
increased by the amount of such Replenishment Amount.
(c) Upon the provision of a Replacement Liquidity Facility in
replacement of this Agreement in accordance with Section 3.6(e) of the
Intercreditor Agreement, amounts remaining on deposit in the Class C Cash
Collateral Account after giving effect to any Applied Provider Advance on
the date of such replacement shall be reimbursed to the Liquidity Provider,
but only to the extent such amounts are necessary to repay in full to the
Liquidity Provider all amounts owing to it hereunder.
Section 2.07. Payments to the Liquidity Provider Under the
Intercreditor Agreement.
In order to provide for payment or repayment to the Liquidity
Provider of any amounts hereunder, the Intercreditor Agreement provides
that amounts available and referred to in Articles II and III of the
Intercreditor Agreement, to the extent payable to the Liquidity Provider
pursuant to the terms of the Intercreditor Agreement (including, without
limitation, Section 3.6(f) of the Intercreditor Agreement), shall be paid
to the Liquidity Provider in accordance with the terms thereof. Amounts so
paid to the Liquidity Provider shall be applied by the Liquidity Provider
to Liquidity Obligations then due and payable in accordance with the
Intercreditor Agreement or, if not provided for in the Intercreditor
Agreement, then in such manner as the Liquidity Provider shall deem
appropriate.
Section 2.08. Book Entries.
The Liquidity Provider shall maintain in accordance with its
usual practice an account or accounts evidencing the indebtedness of the
Borrower resulting from Advances made from time to time and the amounts of
principal and interest payable hereunder and paid from time to time in
respect thereof; provided, however, that the failure by the Liquidity
Provider to maintain such account or accounts shall not affect the
obligations of the Borrower in respect of Advances.
Section 2.09. Payments from Available Funds Only.
All payments to be made by the Borrower under this Agreement
shall be made only from the amounts that constitute Scheduled Payments,
Special Payments or payments under Section 6(c) or 6(b), as the case may
be, of the Participation Agreements and Section 7 of the Note Purchase
Agreement and only to the extent that the Borrower shall have sufficient
income or proceeds therefrom to enable the Borrower to make payments in
accordance with the terms hereof after giving effect to the priority of
payments provisions set forth in the Intercreditor Agreement. The Liquidity
Provider agrees that it will look solely to such amounts to the extent
available for distribution to it as provided in the Intercreditor Agreement
and this Agreement and that the Borrower, in its individual capacity, is
not personally liable to it for any amounts payable or liability under this
Agreement except as expressly provided in this Agreement, the Intercreditor
Agreement or any Participation Agreement. Amounts on deposit in the Class C
Cash Collateral Account shall be available to the Borrower to make payments
under this Agreement only to the extent and for the purposes expressly
contemplated in Section 3.6(f) of the Intercreditor Agreement.
Section 2.10. Extension of the Expiry Date; Non-Extension
Advance.
No earlier than the 60th day and no later than the 40th day
prior to the then effective Expiry Date (unless such Expiry Date is on or
after the date that is 15 days after the Final Legal Distribution Date for
the Class C Certificates), the Borrower shall request that the Liquidity
Provider extend the Expiry Date for a period of 364 days after the then
effective Expiry Date (unless the obligations of the Liquidity Provider are
earlier terminated in accordance with the terms hereof). The Liquidity
Provider may advise the Borrower, no earlier than 40 days and no later than
25 days prior to the then effective Expiry Date that it agrees to so extend
the Expiry Date but in any event, without the necessity of any action on
the part of the Liquidity Provider the Expiry Date shall automatically be
so extended, unless the Liquidity Provider advises the Borrower on or
before the 25th day prior to the Expiry Date then in effect that such
Expiry Date shall not be so extended in which event (and if the Liquidity
Provider shall not have been replaced in accordance with Section 3.6(e) of
the Intercreditor Agreement), the Borrower shall be entitled on and after
such 25th day (but prior to the then effective Expiry Date) to request a
Non-Extension Advance in accordance with Section 2.02(b) hereof and Section
3.6(d) of the Intercreditor Agreement.
ARTICLE III
OBLIGATIONS OF THE BORROWER
Section 3.01. Increased Costs.
The Borrower shall pay to the Liquidity Provider from time to
time such amounts as may be necessary to compensate the Liquidity Provider
for any increased costs incurred by the Liquidity Provider which are
attributable to its making or maintaining any LIBOR Advances hereunder or
its obligation to make any such Advances hereunder, or any reduction in any
amount receivable by the Liquidity Provider under this Agreement or the
Intercreditor Agreement in respect of any such Advances or such obligation
(such increases in costs and reductions in amounts receivable being herein
called "Additional Costs"), resulting from any change after the date of
this Agreement in U.S. federal, state, municipal, or foreign laws or
regulations (including Regulation D of the Board of Governors of the
Federal Reserve System), or the adoption or making after the date of this
Agreement of any interpretations, directives, or requirements applying to a
class of banks including the Liquidity Provider under any U.S. federal,
state, municipal, or any foreign laws or regulations (whether or not having
the force of law) by any court, central bank or monetary authority charged
with the interpretation or administration thereof (a "Regulatory Change"),
which: (1) changes the basis of taxation of any amounts payable to the
Liquidity Provider under this Agreement in respect of any such Advances
(other than Excluded Taxes); or (2) imposes or modifies any reserve,
special deposit, compulsory loan or similar requirements relating to any
extensions of credit or other assets of, or any deposits with other
liabilities of, the Liquidity Provider (including any such Advances or any
deposits referred to in the definition of LIBOR Rate or related
definitions). The Liquidity Provider agrees to use reasonable efforts
(consistent with applicable legal and regulatory restrictions) to change
the jurisdiction of its Facility Office if making such change would avoid
the need for, or reduce the amount of, any amount payable under this
Section that may thereafter accrue and would not, in the reasonable
judgment of the Liquidity Provider, be otherwise disadvantageous to the
Liquidity Provider.
The Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Liquidity
Provider to compensation pursuant to this Section 3.01 as promptly as
practicable after it obtains knowledge thereof and determines to request
such compensation, which notice shall describe in reasonable detail the
calculation of the amounts owed under this Section. Determinations by the
Liquidity Provider for purposes of this Section 3.01 of the effect of any
Regulatory Change on its costs of making or maintaining Advances or on
amounts receivable by it in respect of Advances, and of the additional
amounts required to compensate the Liquidity Provider in respect of any
Additional Costs, shall be prima facie evidence of the amount owed under
this Section.
Notwithstanding the preceding two paragraphs, the Liquidity
Provider and the Subordination Agent agree that the initial Liquidity
Provider (i.e., AIG Matched Funding Corp.) shall not be entitled to the
benefits of the preceding two paragraphs, provided, however, any permitted
assignee or participant of the initial Liquidity Provider which is a bank
organized under the laws of the United States or any State thereof shall be
entitled to the benefits of the preceding two paragraphs (subject, in the
case of any permitted participant, to the limitation set forth in Section
7.08 hereof).
Section 3.02. Capital Adequacy.
If (1) the adoption, after the date hereof, of any applicable
governmental law, rule or regulation regarding capital adequacy, (2) any
change, after the date hereof, in the interpretation or administration of
any such law, rule or regulation by any central bank or other governmental
authority charged with the interpretation or administration thereof or (3)
compliance by the Liquidity Provider or any corporation controlling the
Liquidity Provider with any applicable guideline or request of general
applicability, issued after the date hereof, by any central bank or other
governmental authority (whether or not having the force of law) that
constitutes a change of the nature described in clause (2), has the effect
of requiring an increase in the amount of capital required to be maintained
by the Liquidity Provider or any corporation controlling the Liquidity
Provider, and such increase is based upon the Liquidity Provider's
obligations hereunder and other similar obligations, the Borrower shall pay
to the Liquidity Provider from time to time such additional amount or
amounts as are necessary to compensate the Liquidity Provider for such
portion of such increase as shall be reasonably allocable to the Liquidity
Provider's obligations to the Borrower hereunder. The Liquidity Provider
agrees to use reasonable efforts (consistent with applicable legal and
regulatory restrictions) to change the jurisdiction of its Facility Office
if making such change would avoid the need for, or reduce the amount of,
any amount payable under this Section that may thereafter accrue and would
not, in the reasonable judgment of the Liquidity Provider, be otherwise
materially disadvantageous to the Liquidity Provider.
The Liquidity Provider will notify the Borrower of any event
occurring after the date of this Agreement that will entitle the Liquidity
Provider to compensation pursuant to this Section 3.02 as promptly as
practicable after it obtains knowledge thereof and determines to request
such compensation, which notice shall describe in reasonable detail the
calculation of the amounts owed under this Section. Determinations by the
Liquidity Provider for purposes of this Section 3.02 of the effect of any
increase in the amount of capital required to be maintained by the
Liquidity Provider and of the amount allocable to the Liquidity Provider's
obligations to the Borrower hereunder shall be prima facie evidence of the
amounts owed under this Section.
Notwithstanding the preceding two paragraphs, the Liquidity
Provider and the Subordination Agent agree that the initial Liquidity
Provider (i.e., AIG Matched Funding Corp.) shall not be entitled to the
benefits of the preceding two paragraphs, provided, however, any permitted
assignee or participant of the initial Liquidity Provider which is a bank
organized under the laws of the United States or any State thereof shall be
entitled to the benefits of the preceding two paragraphs (subject, in the
case of any permitted participant, to the limitation set forth in Section
7.08 hereof).
Section 3.03. Payments Free of Deductions.
(a) All payments made by the Borrower under this Agreement
shall be made free and clear of, and without reduction for or on account
of, any present or future stamp or other taxes, levies, imposts, duties,
charges, fees, deductions, withholdings, restrictions or conditions of any
nature whatsoever now or hereafter imposed, levied, collected, withheld or
assessed, excluding Excluded Taxes (such non-excluded taxes being referred
to herein, collectively, as "Non-Excluded Taxes" and, individually, as a
"Non-Excluded Tax"). If any Non-Excluded Taxes are required to be withheld
from any amounts payable to the Liquidity Provider under this Agreement,
the amounts so payable to the Liquidity Provider shall be increased to the
extent necessary to yield to the Liquidity Provider (after payment of all
Non-Excluded Taxes) interest or any other such amounts payable under this
Agreement at the rates or in the amounts specified in this Agreement. The
Liquidity Provider agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Facility Office if making such change would avoid the
need for, or reduce the amount of, any such additional amounts that may
thereafter accrue and would not, in the reasonable judgment of the
Liquidity Provider, be otherwise disadvantageous to the Liquidity Provider.
From time to time upon the reasonable request of the Borrower, if the
Liquidity Provider is not a corporation organized under the laws of the
United States or any State thereof, the Liquidity Provider agrees to
provide to the Borrower two original Internal Revenue Service Form W-8BEN
or W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that the Liquidity Provider is exempt
from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement.
Section 3.04. Payments.
The Borrower shall make or cause to be made each payment to the
Liquidity Provider under this Agreement so as to cause the same to be
received by the Liquidity Provider not later than 1:00 p.m. (New York City
time) on the day when due. The Borrower shall make all such payments in
lawful money of the United States of America, to the Liquidity Provider in
immediately available funds, by wire transfer to UBS AG, Stamford, CT, ABA
#0260-07993, Account Name: AIG Matched Funding Corp., Account No.
WA-659-886-000, Reference: US Airways Liquidity Facility 1999-1C.
Section 3.05. Computations.
All computations of interest based on the Base Rate shall be
made on the basis of a year of 365 or 366 days, as the case may be, and all
computations of interest based on the LIBOR Rate shall be made on the basis
of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the
period for which such interest is payable.
Section 3.06. Payment on Non-Business Days.
Whenever any payment to be made hereunder shall be stated to be
due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day and no additional interest shall be due as a
result (and if so made, shall be deemed to have been made when due). If any
payment in respect of interest on an Advance is so deferred to the next
succeeding Business Day, such deferral shall not delay the commencement of
the next Interest Period for such Advance (if such Advance is a LIBOR
Advance) or reduce the number of days for which interest will be payable on
such Advance on the next interest payment date for such Advance.
Section 3.07. Interest.
(a) Subject to Section 2.09, the Borrower shall pay, or shall
cause to be paid, without duplication, interest on (i) the unpaid principal
amount of each Advance from and including the date of such Advance (or, in
the case of an Applied Provider Advance, from and including the date on
which the amount thereof was withdrawn from the Class C Cash Collateral
Account to pay interest on the Class C Certificates) to but excluding the
date such principal amount shall be paid in full (or, in the case of an
Applied Provider Advance, the date on which the Class C Cash Collateral
Account is fully replenished in respect of such Advance) and (ii) any other
amount due hereunder (whether fees, commissions, expenses or other amounts
or, to the extent permitted by law, installments of interest on Advances or
any such other amount) which is not paid when due (whether at stated
maturity, by acceleration or otherwise) from and including the due date
thereof to but excluding the date such amount is paid in full, in each such
case, at a fluctuating interest rate per annum for each day equal to the
Applicable Liquidity Rate (as defined below) for such Advance or such other
amount as in effect for such day, but in no event at a rate per annum
greater than the maximum rate permitted by applicable law; provided,
however, that, if at any time the otherwise applicable interest rate as set
forth in this Section 3.07 shall exceed the maximum rate permitted by
applicable law, then any subsequent reduction in such interest rate will
not reduce the rate of interest payable pursuant to this Section 3.07 below
the maximum rate permitted by applicable law until the total amount of
interest accrued equals the amount of interest that would have accrued if
such otherwise applicable interest rate as set forth in this Section 3.07
had at all times been in effect.
(b) Except as provided in clause (e) below, each Advance will
be either a Base Rate Advance or a LIBOR Advance as provided in this
Section. Each such Advance will be a Base Rate Advance for the period from
the date of its borrowing to (but excluding) the third Business Day
following the Liquidity Provider's receipt of the Notice of Borrowing for
such Advance. Thereafter, such Advance shall be a LIBOR Advance; provided
that the Borrower (at the direction of the Controlling Party, so long as
the Liquidity Provider is not the Controlling Party) may (x) convert the
Final Advance into a Base Rate Advance on the last day of an Interest
Period for such Advance by giving the Liquidity Provider no less than four
Business Days' prior written notice of such election or (y) elect to
maintain the Final Advance as a Base Rate Advance by not requesting a
conversion of the Final Advance to a LIBOR Advance under Clause (5) of the
applicable Notice of Borrowing (or, if such Final Advance is deemed to have
been made, without delivery of a Notice of Borrowing pursuant to Section
2.06, by requesting, prior to 11:00 a.m. on the first Business Day
immediately following the Borrower's receipt of the applicable Termination
Notice, that such Final Advance not be converted from a Base Rate Advance
to a LIBOR Advance).
(c) Each LIBOR Advance shall bear interest during each Interest
Period at a rate per annum equal to the LIBOR Rate for such Interest Period
plus the Applicable Margin for such LIBOR Advance, payable in arrears on
the last day of such Interest Period and, in the event of the payment of
principal of such LIBOR Advance on a day other than such last day, on the
date of such payment (to the extent of interest accrued on the amount of
principal repaid).
(d) Each Base Rate Advance shall bear interest at a rate per
annum equal to the Base Rate plus the Applicable Margin for such Base Rate
Advance, payable in arrears on each Regular Distribution Date and, in the
event of the payment of principal of such Base Rate Advance on a day other
than a Regular Distribution Date, on the date of such payment (to the
extent of interest accrued on the amount of principal repaid).
(e) Each outstanding Unapplied Provider Advance shall bear
interest in an amount equal to the Investment Earnings on amounts on
deposit in the Class C Cash Collateral Account plus the Applicable Margin
for such Unapplied Provider Advance on the amount of such Unapplied
Provider Advance from time to time, payable in arrears on each Regular
Distribution Date.
(f) Each amount not paid when due hereunder (whether fees,
commissions, expenses or other amounts or, to the extent permitted by
applicable law, installments of interest on Advances but excluding
Advances) shall bear interest at a rate per annum equal to the Base Rate
plus 2.00% until paid.
(g) Each change in the Base Rate shall become effective
immediately. The rates of interest specified in this Section 3.07 with
respect to any Advance or other amount shall be referred to as the
"Applicable Liquidity Rate".
Section 3.08. Replacement of Borrower.
From time to time and subject to the successor Borrower's
meeting the eligibility requirements set forth in Section 6.9 of the
Intercreditor Agreement applicable to the Subordination Agent, upon the
effective date and time specified in a written and completed Notice of
Replacement Subordination Agent in substantially the form of Annex VI
attached hereto (a "Notice of Replacement Subordination Agent") delivered
to the Liquidity Provider by the then Borrower, the successor Borrower
designated therein shall be substituted for as the Borrower for all
purposes hereunder.
Section 3.09. Funding Loss Indemnification.
The Borrower shall pay to the Liquidity Provider, upon the
request of the Liquidity Provider, such amount or amounts as shall be
sufficient (in the reasonable opinion of the Liquidity Provider) to
compensate it for any loss, cost, or expense incurred by reason of the
liquidation or redeployment of deposits or other funds acquired by the
Liquidity Provider to fund or maintain any LIBOR Advance (but excluding
loss of anticipated profits) incurred as a result of:
(1) Any repayment of a LIBOR Advance or conversion of a LIBOR
Advance to a Base Rate Advance on a date other than the last day of the
Interest Period for such Advance; or
(2) Any failure by the Borrower to borrow a LIBOR Advance on
the date for borrowing specified in the relevant notice under Section 2.02.
Section 3.10. Illegality.
Notwithstanding any other provision in this Agreement, if any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Liquidity Provider (or its
Facility Office) with any request or directive (whether or not having the
force of law) of any such authority, central bank or comparable agency
shall make it unlawful or impossible for the Liquidity Provider (or its
Facility Office) to maintain or fund its LIBOR Advances, then upon notice
to the Borrower by the Liquidity Provider, the outstanding principal amount
of the LIBOR Advances shall be converted to Base Rate Advances (a)
immediately upon demand of the Liquidity Provider, if such change or
compliance with such request, in the judgment of the Liquidity Provider,
requires immediate repayment; or (b) at the expiration of the last Interest
Period to expire before the effective date of any such change or request.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01. Conditions Precedent to Effectiveness of Section
2.01.
Section 2.01 of this Agreement shall become effective on and as
of the first date (the "Effective Date") on which the following conditions
precedent have been satisfied or waived:
(a) The Liquidity Provider shall have received on or before the
Closing Date each of the following, and in the case of each document
delivered pursuant to paragraphs (i), (ii) and (iii), each in form and
substance satisfactory to the Liquidity Provider:
(i) This Agreement duly executed on behalf of the Borrower;
(ii) The Intercreditor Agreement duly executed on behalf of
each of the parties thereto;
(iii) Fully executed copies of each of the Operative
Agreements executed and delivered on or before the
Closing Date (other than this Agreement and the
Intercreditor Agreement);
(iv) A copy of the Prospectus Supplement and specimen copies
of the Class C Certificates;
(v) An executed copy of each document, instrument,
certificate and opinion delivered on or before the
Closing Date pursuant to the Class C Trust Agreement,
the Intercreditor Agreement and the other Operative
Agreements (in the case of each such opinion, other than
the opinion of counsel for the Underwriters, either
addressed to the Liquidity Provider or accompanied by a
letter from the counsel rendering such opinion to the
effect that the Liquidity Provider is entitled to rely
on such opinion as of its date as if it were addressed
to the Liquidity Provider);
(vi) Evidence that there shall have been made and shall be in
full force and effect, all filings, recordings and/or
registrations, and there shall have been given or taken
any notice or other similar action as may be reasonably
necessary or, to the extent reasonably requested by the
Liquidity Provider, reasonably advisable, in order to
establish, perfect, protect and preserve the right,
title and interest, remedies, powers, privileges, liens
and security interests of, or for the benefit of, the
Trustees, the Borrower and the Liquidity Provider
created by the Operative Agreements executed and
delivered on or prior to the Closing Date;
(vii) An agreement from US Airways, pursuant to which (i) US
Airways agrees to provide copies of quarterly financial
statements and audited annual financial statements to
the Liquidity Provider, and such other information as
the Liquidity Provider shall reasonably request with
respect to the transactions contemplated by the
Operative Agreements, in each case, only to the extent
that US Airways is obligated to provide such information
pursuant to Section 16 of the Leases (related to Leased
Aircraft) or the corresponding section of the Indentures
(related to Owned Aircraft) to the parties thereto and
(ii) US Airways agrees to allow the Liquidity Provider
to inspect US Airways' books and records regarding such
transactions, and to discuss such transactions with
officers and employees of US Airways; and
(viii) Such other documents, instruments, opinions and
approvals pertaining to the transactions contemplated
hereby or by the other Operative Agreements as the
Liquidity Provider shall have reasonably requested.
(b) The following statement shall be true on and as of the
Effective Date: no event has occurred and is continuing, or would result
from the entering into of this Agreement or the making of any Advance,
which constitutes a Liquidity Event of Default.
(c) The Liquidity Provider shall have received payment in full
of all fees and other sums required to be paid to or for the account of the
Liquidity Provider on or prior to the Effective Date.
(d) All conditions precedent to the issuance of the
Certificates under the Trust Agreements shall have been satisfied or
waived, all conditions precedent to the effectiveness of the other
Liquidity Facilities shall have been satisfied or waived, and all
conditions precedent to the purchase of the Class A Certificates and Class
B Certificates by the Underwriters under the Underwriting Agreement and the
purchase of the Class C Certificates by AIFS under the Class C Purchase
Agreement shall have been satisfied (unless any of such conditions
precedent shall have been waived by the Underwriters or AIFS, as the case
may be).
(e) The Borrower shall have received a certificate, dated the
date hereof, signed by a duly authorized representative of the Liquidity
Provider, certifying that all conditions precedent to the effectiveness of
Section 2.01 have been satisfied or waived.
Section 4.02. Conditions Precedent to Borrowing.
The obligation of the Liquidity Provider to make an Advance on
the occasion of each Borrowing shall be subject to the conditions precedent
that the Effective Date shall have occurred and, prior to the date of such
Borrowing, the Borrower shall have delivered a Notice of Borrowing which
conforms to the terms and conditions of this Agreement and has been
completed as may be required by the relevant form of the Notice of
Borrowing for the type of Advances requested.
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants of the Borrower.
So long as any Advance shall remain unpaid or the Liquidity
Provider shall have any Maximum Commitment hereunder or the Borrower shall
have any obligation to pay any amount to the Liquidity Provider hereunder,
the Borrower will, unless the Liquidity Provider shall otherwise consent in
writing:
(a) Performance of This and Other Agreements. Punctually pay or
cause to be paid all amounts payable by it under this Agreement and the
other Operative Agreements and observe and perform in all material respects
the conditions, covenants and requirements applicable to it contained in
this Agreement and the other Operative Agreements.
(b) Reporting Requirements. Furnish to the Liquidity Provider
with reasonable promptness, such other information and data with respect to
the transactions contemplated by the Operative Agreements as from time to
time may be reasonably requested by the Liquidity Provider; and permit the
Liquidity Provider, upon reasonable notice, to inspect the Borrower's books
and records with respect to such transactions and to meet with officers and
employees of the Borrower to discuss such transactions.
(c) Certain Operative Agreements. Furnish to the Liquidity
Provider with reasonable promptness, such Operative Agreements entered into
after the date hereof as from time to time may be reasonably requested by
the Liquidity Provider.
Section 5.02. Negative Covenants of the Borrower.
So long as any Advance shall remain unpaid or the Liquidity
Provider shall have any Maximum Commitment hereunder or the Borrower shall
have any obligation to pay any amount to the Liquidity Provider hereunder,
the Borrower will not appoint or permit or suffer to be appointed any
successor Borrower without the prior written consent of the Liquidity
Provider, which consent shall not be unreasonably withheld or delayed.
ARTICLE VI
LIQUIDITY EVENTS OF DEFAULT
Section 6.01. Liquidity Events of Default.
If (a) any Liquidity Event of Default has occurred and is
continuing and (b) there is a Performing Note Deficiency, the Liquidity
Provider may, in its discretion, deliver to the Borrower a Termination
Notice, the effect of which shall be to cause (i) the obligation of the
Liquidity Provider to make Advances hereunder to expire on the fifth
Business Day after the date on which such Termination Notice is received by
the Borrower, (ii) the Borrower to promptly request, and the Liquidity
Provider to promptly make, a Final Advance in accordance with Section
2.02(d) hereof and Section 3.6(i) of the Intercreditor Agreement, (iii) all
other outstanding Advances to be automatically converted into Final
Advances for purposes of determining the Applicable Liquidity Rate for
interest payable thereon, and (iv) subject to Sections 2.07 and 2.09
hereof, all Advances (including, without limitation, any Provider Advance
and Applied Provider Advance), any accrued interest thereon and any other
amounts outstanding hereunder to become immediately due and payable to the
Liquidity Provider.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Amendments, Etc.
No amendment or waiver of any provision of this Agreement, nor
consent to any departure by the Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Liquidity
Provider, and, in the case of an amendment or of a waiver by the Borrower,
the Borrower, and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
Section 7.02. Notices, Etc.
Except as otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including
telecopier and mailed or delivered or sent by telecopier):
Borrower: STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
225 Asylum Street
Goodwyn Square
Hartford, CT 06103
Attention: Corporate/Muni. Department
Telephone: (860) 244-1822
Telecopy: (860) 244-1889
with a copy to:
State Street Bank and Trust Company.
Corporate Trust Department
2 International Place, 4th Floor
Boston, MA 02110
Attention: Ruth A. Smith
Telecopy: (617) 664-5151
Liquidity Provider: AIG MATCHED FUNDING CORP.
100 Nyala Farm
Westport, CT 06880
Attention: Chief Financial Officer
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
with a copy to:
The General Counsel
AIG Matched Funding Corp.
100 Nyala Farm
Westport, CT 06880
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
or, as to each of the foregoing, at such other address as shall be
designated by such Person in a written notice to the others. All such
notices and communications shall be effective (i) if given by telecopier,
when transmitted to the telecopier number specified above and (ii) if given
by other means, when delivered at the address specified above, except that
written notices to the Liquidity Provider pursuant to the provisions of
Articles II and III hereof shall not be effective until received by the
Liquidity Provider. A copy of all notices delivered hereunder to either
party shall in addition be delivered to each of the parties to the
Participation Agreements at their respective addresses set forth therein.
Section 7.03. No Waiver; Remedies.
No failure on the part of the Liquidity Provider to exercise,
and no delay in exercising, any right under this Agreement shall operate as
a waiver thereof; nor shall any single or partial exercise of any right
under this Agreement preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
Section 7.04. Further Assurances.
The Borrower agrees to do such further acts and things and to
execute and deliver to the Liquidity Provider such additional assignments,
agreements, powers and instruments as the Liquidity Provider may reasonably
require or deem advisable to carry into effect the purposes of this
Agreement and the other Operative Agreements or to better assure and
confirm unto the Liquidity Provider its rights, powers and remedies
hereunder and under the other Operative Agreements.
Section 7.05. Indemnification; Survival of Certain Provisions.
The Liquidity Provider shall be indemnified hereunder to the
extent and in the manner described in Section 6(c) or 6(b), as the case may
be, of the Participation Agreements. In addition, the Borrower agrees to
indemnify, protect, defend and hold harmless the Liquidity Provider from,
against and in respect of, and shall pay on demand, all Expenses of any
kind or nature whatsoever (other than any Expenses of the nature described
in Section 3.01, 3.02 or 7.07 hereof or in the Fee Letter (regardless of
whether indemnified against pursuant to said Sections or in such Fee
Letter)), that may be imposed, incurred by or asserted against any
Liquidity Indemnitee, in any way relating to, resulting from, or arising
out of or in connection with any action, suit or proceeding by any third
party against such Liquidity Indemnitee and relating to this Agreement, the
Fee Letter, the Intercreditor Agreement or any Financing Agreement;
provided, however, that the Borrower shall not be required to indemnify,
protect, defend and hold harmless any Liquidity Indemnitee in respect of
any Expense of such Liquidity Indemnitee to the extent such Expense is (i)
attributable to the gross negligence or willful misconduct of such
Liquidity Indemnitee or any other Liquidity Indemnitee, (ii) ordinary and
usual operating overhead expense, or (iii) attributable to the failure by
such Liquidity Indemnitee or any other Liquidity Indemnitee to perform or
observe any agreement, covenant or condition on its part to be performed or
observed in this Agreement, the Intercreditor Agreement, the Fee Letter or
any other Operative Agreement to which it is a party. The indemnities
contained in Section 6(c) or 6(b), as the case may be, of the Participation
Agreements, and the provisions of Sections 3.01, 3.02, 3.03, 3.09, 7.05 and
7.07 hereof, shall survive the termination of this Agreement.
Section 7.06. Liability of the Liquidity Provider.
(a) Neither the Liquidity Provider nor any of its officers,
employees, directors or Affiliates shall be liable or responsible for: (i)
the use which may be made of the Advances or any acts or omissions of the
Borrower or any beneficiary or transferee in connection therewith; (ii) the
validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; or (iii) the making of
Advances by the Liquidity Provider against delivery of a Notice of
Borrowing and other documents which do not comply with the terms hereof;
provided, however, that the Borrower shall have a claim against the
Liquidity Provider, and the Liquidity Provider shall be liable to the
Borrower, to the extent of any damages suffered by the Borrower which were
the result of (A) the Liquidity Provider's willful misconduct or negligence
in determining whether documents presented hereunder comply with the terms
hereof, or (B) any breach by the Liquidity Provider of any of the terms of
this Agreement, including, but not limited to, the Liquidity Provider's
failure to make lawful payment hereunder after the delivery to it by the
Borrower of a Notice of Borrowing strictly complying with the terms and
conditions hereof.
(b) Neither the Liquidity Provider nor any of its officers,
employees, directors or Affiliates shall be liable or responsible in any
respect for (i) any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with this Agreement or any Notice of Borrowing delivered
hereunder, or (ii) any action, inaction or omission which may be taken by
it in good faith, absent willful misconduct or negligence (in which event
the extent of the Liquidity Provider's potential liability to the Borrower
shall be limited as set forth in the immediately preceding paragraph), in
connection with this Agreement or any Notice of Borrowing.
Section 7.07. Costs, Expenses and Taxes.
The Borrower agrees to pay, or cause to be paid (A) on the
Effective Date and on such later date or dates on which the Liquidity
Provider shall make demand, all reasonable out-of-pocket costs and expenses
(including, without limitation, the reasonable fees and expenses of outside
counsel for the Liquidity Provider) of the Liquidity Provider in connection
with the preparation, negotiation, execution, delivery, filing and
recording of this Agreement, any other Operative Agreement and any other
documents which may be delivered in connection with this Agreement and (B)
on demand, all reasonable costs and expenses (including reasonable counsel
fees and expenses) of the Liquidity Provider in connection with (i) the
enforcement of this Agreement or any other Operative Agreement, (ii) the
modification or amendment of, or supplement to, this Agreement or any other
Operative Agreement or such other documents which may be delivered in
connection herewith or therewith (whether or not the same shall become
effective) or (iii) any action or proceeding relating to any order,
injunction, or other process or decree restraining or seeking to restrain
the Liquidity Provider from paying any amount under this Agreement, the
Intercreditor Agreement or any other Operative Agreement or otherwise
affecting the application of funds in the Class C Cash Collateral Account.
In addition, the Borrower shall pay any and all recording, stamp and other
similar taxes and fees payable or determined to be payable in connection
with the execution, delivery, filing and recording of this Agreement, any
other Operative Agreement and such other documents, and agrees to save the
Liquidity Provider harmless from and against any and all liabilities with
respect to or resulting from any delay in paying or omission to pay such
taxes or fees.
Section 7.08. Binding Effect; Participations.
(a) This Agreement shall be binding upon and inure to the
benefit of the Borrower and the Liquidity Provider and their respective
successors and assigns, except that neither the Liquidity Provider (except
as otherwise provided in this Section 7.08) nor (except as contemplated by
Section 3.08) the Borrower shall have the right to assign its rights or
obligations hereunder or any interest herein without the prior written
consent of the other party, subject to the requirements of Section 7.08(b).
The Liquidity Provider may grant participations herein or in any of its
rights hereunder (including, without limitation, funded participations and
participations in rights to receive interest payments hereunder) and under
the other Operative Agreements to such Persons (other than US Airways or
any of its affiliates) as the Liquidity Provider may in its sole discretion
select, subject to the requirements of Section 7.08(b). No such
participation by the Liquidity Provider, however, will relieve the
Liquidity Provider of its obligations hereunder. In connection with any
participation or any proposed participation, the Liquidity Provider may
disclose to the participant or the proposed participant any information
that the Borrower is required to deliver or to disclose to the Liquidity
Provider pursuant to this Agreement. The Borrower acknowledges and agrees
that the Liquidity Provider's source of funds may derive in part from its
participants. Accordingly, references in this Agreement and the other
Operative Agreements to determinations, reserve and capital adequacy
requirements, increased costs, reduced receipts, additional amounts due
pursuant to Section 3.03(a) and the like as they pertain to the Liquidity
Provider shall be deemed also to include those of each of its participants
that are banks (subject, in each case, if any such participant is not a
bank that is (i) organized under the laws of the United States or any State
thereof and (ii) a member bank of the Federal Reserve System with deposits
exceeding $1,000,000,000 (such a bank, a "Reference Bank"), to the maximum
amount that would have been directly incurred by any Reference Bank
organized under the laws of the United States or any State thereof if such
Reference Bank, rather than the participant, had held the interest
participated).
(b) If, pursuant to subsection (a) above, the Liquidity
Provider sells any participation in this Agreement to any bank or other
entity (each, a "Transferee"), then, concurrently with the effectiveness of
such participation, the Transferee shall (i) represent to the Liquidity
Provider (for the benefit of the Liquidity Provider and the Borrower)
either (A) that it is incorporated under the laws of the United States or a
state thereof or (B) that under applicable law and treaties, no taxes will
be required to be withheld with respect to any payments to be made to such
Transferee in respect of this Agreement, (ii) furnish to the Liquidity
Provider and the Borrower either (x) a statement that it is incorporated
under the laws of the United States or a state thereof or (y) if it is not
so incorporated, two copies of a properly completed United States Internal
Revenue Service Form W-8ECI or Form W-8BEN, as appropriate, or other
applicable form, certificate or document prescribed by the Internal Revenue
Service certifying, in each case, such Transferee's entitlement to a
complete exemption from United States federal withholding tax in respect to
any and all payments to be made hereunder, and (iii) agree (for the benefit
of the Liquidity Provider and the Borrower) to provide the Liquidity
Provider and the Borrower a new Form W-8ECI or Form W-8BEN, as appropriate,
(A) on or before the date that any such form expires or becomes obsolete or
(B) after the occurrence of any event requiring a change in the most recent
form previously delivered by it and prior to the immediately following due
date of any payment by the Borrower hereunder, certifying in the case of a
Form W-8BEN or Form W-8ECI that such Transferee is entitled to a complete
exemption from United States federal withholding tax on payments under this
Agreement. Unless the Borrower has received forms or other documents
reasonably satisfactory to it (and required by applicable law) indicating
that payments hereunder are not subject to United States federal
withholding tax, the Borrower will withhold taxes as required by law from
such payments at the applicable statutory rate.
(c) Notwithstanding the other provisions of this Section 7.08,
the Liquidity Provider may assign and pledge all or any portion of the
Advances owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued
by such Federal Reserve Bank, provided that any payment in respect of such
assigned Advances made by the Borrower to the Liquidity Provider in
accordance with the terms of this Agreement shall satisfy the Borrower's
obligations hereunder in respect of such assigned Advance to the extent of
such payment. No such assignment shall release the Liquidity Provider from
its obligations hereunder.
Section 7.09. Severability.
Any provision of this Agreement which is prohibited,
unenforceable or not authorized in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or non-authorization without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of
such provision in any other jurisdiction.
Section 7.10. GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
Section 7.11. Submission to Jurisdiction; Waiver of Jury Trial;
Waiver of Immunity.
(a) Each of the parties hereto hereby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal action
or proceeding relating to this Agreement or any other
Operative Agreement, or for recognition and enforcement
of any judgment in respect hereof or thereof, to the
nonexclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of
America for the Southern District of New York, and the
appellate courts from any thereof;
(ii) consents that any such action or proceeding may be
brought in such courts, and waives any objection that it
may now or hereafter have to the venue of any such action
or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially
similar form of mail), postage prepaid, to each party
hereto at its address set forth in Section 7.02 hereof,
or at such other address of which the Liquidity Provider
shall have been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted
by law or shall limit the right to sue in any other
jurisdiction.
(b) THE BORROWER AND THE LIQUIDITY PROVIDER EACH HEREBY AGREE
TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN
THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP
THAT IS BEING ESTABLISHED, including, without limitation, contract claims,
tort claims, breach of duty claims and all other common law and statutory
claims. The Borrower and the Liquidity Provider each warrant and represent
that it has reviewed this waiver with its legal counsel, and that it
knowingly and voluntarily waives its jury trial rights following
consultation with such legal counsel. THIS WAIVER IS IRREVOCABLE, AND
CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THIS AGREEMENT.
(c) The Liquidity Provider hereby waives any immunity it may
have from the jurisdiction of the courts of the United States or of any
State and waives any immunity any of its properties located in the United
States may have from attachment or execution upon a judgment entered by any
such court under the United States Foreign Sovereign Immunities Act of 1976
or any similar successor legislation.
Section 7.12. Execution in Counterparts.
This Agreement may be executed in any number of counterparts
and by different parties hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute
but one and the same Agreement.
Section 7.13. Entirety.
This Agreement, the Intercreditor Agreement and the other
Operative Agreements to which the Liquidity Provider is a party constitute
the entire agreement of the parties hereto with respect to the subject
matter hereof and supersedes all prior understandings and agreements of
such parties.
Section 7.14. Headings.
Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
Section 7.15. LIQUIDITY PROVIDER'S OBLIGATION TO MAKE ADVANCES.
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE
OBLIGATIONS OF THE LIQUIDITY PROVIDER TO MAKE ADVANCES HEREUNDER, AND THE
BORROWER'S RIGHTS TO DELIVER NOTICES OF BORROWING REQUESTING THE MAKING OF
ADVANCES HEREUNDER, SHALL BE UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE
PAID OR PERFORMED, IN EACH CASE STRICTLY IN ACCORDANCE WITH THE TERMS OF
THIS AGREEMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first
set forth above.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Subordination Agent, as
agent and trustee for the Class C
Trust, as Borrower
By: /s/ Julie A. Balerna
_________________________________
Name: Julie A. Balerna
Title: Assistant Vice President
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
By: /s/ Colum Carr
_________________________________
Name: Colum Carr
Title: Vice President
Annex I to Revolving Credit Agreement
INTEREST ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "Borrower"), hereby certifies to AIG MATCHED FUNDING CORP.
(the "Liquidity Provider"), with reference to the Revolving Credit
Agreement (1999-1C) dated as of August 31, 1999, between the Borrower and
the Liquidity Provider (the "Liquidity Agreement"; the terms defined
therein and not otherwise defined herein being used herein as therein
defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of an Interest Advance by the Liquidity Provider to be used,
subject to clause (3)(v) below, for the payment of the interest on
the Class C Certificates which was payable on ____________, ____ (the
"Distribution Date") in accordance with the terms and provisions of
the Class C Trust Agreement and the Class C Certificates, which
Advance is requested to be made on ____________, ____.
(3) The amount of the Interest Advance requested hereby (i) is
$_______________.__, to be applied in respect of the payment of the
interest which was due and payable on the Class C Certificates on the
Distribution Date, (ii) does not include any amount with respect to
the payment of principal of, or premium on, the Class A Certificates,
the Class B Certificates or the Class C Certificates, or interest on
the Class A Certificates or the Class B Certificates, (iii) was
computed in accordance with the provisions of the Class C
Certificates, the Class C Trust Agreement and the Intercreditor
Agreement (a copy of which computation is attached hereto as Schedule
I), (iv) does not exceed the Maximum Available Commitment on the date
hereof, (v) does not include any amount of interest which was due and
payable on the Class C Certificates on such Distribution Date but
which remains unpaid due to the failure of the Depositary to pay any
amount of accrued interest on the Deposits on such Distribution Date
and (vi) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will apply the same in accordance
with the terms of Section 3.6(b) of the Intercreditor Agreement, (b)
no portion of such amount shall be applied by the Borrower for any
other purpose and (c) no portion of such amount until so applied
shall be commingled with other funds held by the Borrower.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, the making of the Interest Advance as requested by
this Notice of Borrowing shall automatically reduce, subject to
reinstatement in accordance with the terms of the Liquidity Agreement, the
Maximum Available Commitment by an amount equal to the amount of the
Interest Advance requested to be made hereby as set forth in clause (i) of
paragraph (3) of this Certificate and such reduction shall automatically
result in corresponding reductions in the amounts available to be borrowed
pursuant to a subsequent Advance.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Subordination Agent, as
Borrower
By:_________________________________
Name:
Title:
SCHEDULE I TO INTEREST ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with
Interest Advance Notice of Borrowing]
Annex II to
Revolving Credit Agreement
NON-EXTENSION ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "Borrower"), hereby certifies to AIG MATCHED FUNDING CORP.
(the "Liquidity Provider"), with reference to the Revolving Credit
Agreement (1999-1C) dated as of August 31, 1999, between the Borrower and
the Liquidity Provider (the "Liquidity Agreement"; the terms defined
therein and not otherwise defined herein being used herein as therein
defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Non-Extension Advance by the Liquidity Provider to be
used for the funding of the Class C Cash Collateral Account in
accordance with Section 3.6(d) of the Intercreditor Agreement, which
Advance is requested to be made on __________, ____.
(3) The amount of the Non-Extension Advance requested hereby
(i) is $_______________.__, which equals the Maximum Available
Commitment on the date hereof and is to be applied in respect of the
funding of the Class C Cash Collateral Account in accordance with
Section 3.6(d) of the Intercreditor Agreement, (ii) does not include
any amount with respect to the payment of the principal of, or
premium on, the Class C Certificates, or principal of, or interest or
premium on, the Class A Certificates or the Class B Certificates,
(iii) was computed in accordance with the provisions of the Class C
Certificates, the Class C Trust Agreement and the Intercreditor
Agreement (a copy of which computation is attached hereto as Schedule
I), and (iv) has not been and is not the subject of a prior or
contemporaneous Notice of Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the
Class C Cash Collateral Account and apply the same in accordance with
the terms of Section 3.6(d) of the Intercreditor Agreement, (b) no
portion of such amount shall be applied by the Borrower for any other
purpose and (c) no portion of such amount until so applied shall be
commingled with other funds held by the Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice](1).
- --------
(1) Bracketed language may be included at Borrower's option.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Non-Extension Advance as
requested by this Notice of Borrowing shall automatically and irrevocably
terminate the obligation of the Liquidity Provider to make further Advances
under the Liquidity Agreement; and (B) following the making by the
Liquidity Provider of the Non-Extension Advance requested by this Notice of
Borrowing, the Borrower shall not be entitled to request any further
Advances under the Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Subordination Agent, as
Borrower
By:_________________________________
Name:
Title:
SCHEDULE I TO NON-EXTENSION ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with
Non-Extension Advance Notice of Borrowing]
Annex III to
Revolving Credit Agreement
DOWNGRADE ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "Borrower"), hereby certifies to AIG MATCHED FUNDING CORP.
(the "Liquidity Provider"), with reference to the Revolving Credit
Agreement (1999-1A) dated as of August 31, 1999, between the Borrower and
the Liquidity Provider (the "Liquidity Agreement"; the terms defined
therein and not otherwise defined herein being used herein as therein
defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Downgrade Advance by the Liquidity Provider to be used
for the funding of the Class C Cash Collateral Account in accordance
with Section 3.6(c) of the Intercreditor Agreement by reason of the
downgrading of the short-term unsecured debt rating of the Liquidity
Provider issued by either Rating Agency below the Threshold Rating,
which Advance is requested to be made on __________, ____.
(3) The amount of the Downgrade Advance requested hereby (i) is
$_______________.__, which equals the Maximum Available Commitment on
the date hereof and is to be applied in respect of the funding of the
Class C Cash Collateral Account in accordance with Section 3.6(c) of
the Intercreditor Agreement, (ii) does not include any amount with
respect to the payment of the principal of, or premium on, the Class
C Certificates, or principal of, or interest or premium on, the Class
A Certificates or the Class B Certificates, (iii) was computed in
accordance with the provisions of the Class C Certificates, the Class
C Trust Agreement and the Intercreditor Agreement (a copy of which
computation is attached hereto as Schedule I), and (iv) has not been
and is not the subject of a prior or contemporaneous Notice of
Borrowing under the Liquidity Agreement.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the
Class C Cash Collateral Account and apply the same in accordance with
the terms of Section 3.6(c) of the Intercreditor Agreement, (b) no
portion of such amount shall be applied by the Borrower for any other
purpose and (c) no portion of such amount until so applied shall be
commingled with other funds held by the Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice](2).
- --------
(2) Bracketed language may be included at Borrower's option.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Downgrade Advance as requested
by this Notice of Borrowing shall automatically and irrevocably terminate
the obligation of the Liquidity Provider to make further Advances under the
Liquidity Agreement; and (B) following the making by the Liquidity Provider
of the Downgrade Advance requested by this Notice of Borrowing, the
Borrower shall not be entitled to request any further Advances under the
Liquidity Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Subordination Agent, as
Borrower
By:__________________________________
Name:
Title:
SCHEDULE I TO DOWNGRADE ADVANCE NOTICE OF BORROWING
[Insert Copy of computations in accordance with
Downgrade Advance Notice of Borrowing]
Annex IV to
Revolving Credit Agreement
FINAL ADVANCE NOTICE OF BORROWING
The undersigned, a duly authorized signatory of the undersigned
borrower (the "Borrower"), hereby certifies to AIG MATCHED FUNDING CORP.
(the "Liquidity Provider"), with reference to the Revolving Credit
Agreement (1999-1C) dated as of August 31, 1999, between the Borrower and
the Liquidity Provider (the "Liquidity Agreement"; the terms defined
therein and not otherwise defined herein being used herein as therein
defined or referenced), that:
(1) The Borrower is the Subordination Agent under the
Intercreditor Agreement.
(2) The Borrower is delivering this Notice of Borrowing for the
making of the Final Advance by the Liquidity Provider to be used for
the funding of the Class C Cash Collateral Account in accordance with
Section 3.6(i) of the Intercreditor Agreement by reason of the
receipt by the Borrower of a Termination Notice from the Liquidity
Provider with respect to the Liquidity Agreement, which Advance is
requested to be made on ____________, ____.
(3) The amount of the Final Advance requested hereby (i) is
$_________________.__, which equals the Maximum Available Commitment
on the date hereof and is to be applied in respect of the funding of
the Class C Cash Collateral Account in accordance with Section 3.6(i)
of the Intercreditor Agreement, (ii) does not include any amount with
respect to the payment of principal of, or premium on, the Class C
Certificates, or principal of, or interest or premium on, the Class A
Certificates or the Class B Certificates, (iii) was computed in
accordance with the provisions of the Class C Certificates, the Class
C Trust Agreement and the Intercreditor Agreement (a copy of which
computation is attached hereto as Schedule I), and (iv) has not been
and is not the subject of a prior or contemporaneous Notice of
Borrowing.
(4) Upon receipt by or on behalf of the Borrower of the amount
requested hereby, (a) the Borrower will deposit such amount in the
Class C Cash Collateral Account and apply the same in accordance with
the terms of Section 3.6(i) of the Intercreditor Agreement, (b) no
portion of such amount shall be applied by the Borrower for any other
purpose and (c) no portion of such amount until so applied shall be
commingled with other funds held by the Borrower.
(5) The Borrower hereby requests that the Advance requested
hereby be a Base Rate Advance [and that such Base Rate Advance be
converted into a LIBOR Advance on the third Business Day following
your receipt of this notice](3).
- --------
(3) Bracketed language may be included at Borrower's option.
The Borrower hereby acknowledges that, pursuant to the
Liquidity Agreement, (A) the making of the Final Advance as requested by
this Notice of Borrowing shall automatically and irrevocably terminate the
obligation of the Liquidity Provider to make further Advances under the
Liquidity Agreement; and (B) following the making by the Liquidity Provider
of the Final Advance requested by this Notice of Borrowing, the Borrower
shall not be entitled to request any further Advances under the Liquidity
Agreement.
IN WITNESS WHEREOF, the Borrower has executed and delivered
this Notice of Borrowing as of the ____ day of _________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Subordination Agent, as
Borrower
By:________________________________
Name:
Title:
SCHEDULE I TO FINAL ADVANCE NOTICE OF BORROWING
[Insert Copy of Computations in accordance with
Final Advance Notice of Borrowing]
Annex V to
Revolving Credit Agreement
NOTICE OF TERMINATION
[Date]
State Street Bank and Trust Company of Connecticut,
National Association,
as Subordination Agent, as Borrower
225 Asylum Street
Goodwyn Square
Hartford, CT 06103
Attention: Corporate Trust Administration
Revolving Credit Agreement dated as of August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, as agent and
trustee for the US Airways Pass Through Trust, 1999-1C, as
Borrower, and AIG MATCHED FUNDING CORP. (the "Liquidity
Agreement")
Ladies and Gentlemen:
You are hereby notified that pursuant to Section 6.01 of the
Liquidity Agreement, by reason of the occurrence of a Liquidity Event of
Default and the existence of a Performing Note Deficiency (each as defined
therein), we are giving this notice to you in order to cause (i) our
obligations to make Advances (as defined therein) under such Liquidity
Agreement to terminate on the fifth Business Day after the date on which
you receive this notice and (ii) you to request a Final Advance under the
Liquidity Agreement pursuant to Section 3.6(i) of the Intercreditor
Agreement (as defined in the Liquidity Agreement) as a consequence of your
receipt of this notice.
THIS NOTICE IS THE "NOTICE OF TERMINATION" PROVIDED FOR UNDER
THE LIQUIDITY AGREEMENT. OUR OBLIGATIONS TO MAKE ADVANCES UNDER THE
LIQUIDITY AGREEMENT WILL TERMINATE ON THE FIFTH BUSINESS DAY AFTER THE DATE
ON WHICH YOU RECEIVE THIS NOTICE.
Very truly yours,
AIG MATCHED FUNDING CORP.,
as Liquidity Provider
By:______________________________
Name:
Title:
cc: State Street Bank and Trust Company of Connecticut,
National Association, as Class C Trustee
Annex VI to
Revolving Credit Agreement
NOTICE OF REPLACEMENT SUBORDINATION AGENT
[Date]
Attention:
Revolving Credit Agreement dated as of August 31, 1999,
between State Street Bank and Trust Company of Connecticut,
National Association, as Subordination Agent, as agent and
trustee for the US Airways Pass Through Trust, 1999-1C, as
Borrower, and AIG MATCHED FUNDING CORP. (the "Liquidity
Agreement")
Ladies and Gentlemen:
For value received, the undersigned beneficiary hereby
irrevocably transfers to:
------------------------------
[Name of Transferee]
------------------------------
[Address of Transferee]
all rights and obligations of the undersigned as Borrower under the
Liquidity Agreement referred to above. The transferee has succeeded the
undersigned as Subordination Agent under the Intercreditor Agreement
referred to in the first paragraph of the Liquidity Agreement, pursuant to
the terms of Section 8.1 of the Intercreditor Agreement.
By this transfer, all rights of the undersigned as Borrower
under the Liquidity Agreement are transferred to the transferee and the
transferee shall hereafter have the sole rights and obligations as Borrower
thereunder. The undersigned shall pay any costs and expenses of such
transfer, including, but not limited to, transfer taxes or governmental
charges.
We ask that this transfer be effective as of ___________, ____.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Subordination Agent, as
Borrower
By:_________________________________
Name:
Title:
By:_________________________________
Name:
Title:
Exhibit 4(a)(ix)
[GRAPHIC OMITTED]
INTERCREDITOR AGREEMENT
Dated as of
August 31, 1999
AMONG
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
not in its individual capacity
but solely as Trustee under the
US Airways Pass Through Trust 1999-1A,
US Airways Pass Through Trust 1999-1B
and
US Airways Pass Through Trust 1999-1C
AIG MATCHED FUNDING CORP.
as Class A Liquidity Provider,
as Class B Liquidity Provider,
and
as Class C Liquidity Provider
AND
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
not in its individual capacity except
as expressly set forth herein but
solely as Subordination Agent and Trustee
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS....................................2
SECTION 1.1. Definitions.............................2
ARTICLE II TRUST ACCOUNTS; CONTROLLING PARTY............21
SECTION 2.1. Agreement to Terms of Subordination;
Payments from Monies Received Only.....21
SECTION 2.2. Trust Accounts.........................22
SECTION 2.3. Deposits to the Collection Account
and Special Payments Account...........23
SECTION 2.4. Distributions of Special Payments......23
SECTION 2.5. Designated Representatives.............26
SECTION 2.6. Controlling Party......................27
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED.........................................28
SECTION 3.1. Written Notice of Distribution.........28
SECTION 3.2. Distribution of Amounts on Deposit
in the Collection Account..............31
SECTION 3.3. Distribution of Amounts on Deposit
Following a Triggering Event...........32
SECTION 3.4. Other Payments.........................34
SECTION 3.5. Payments to the Trustees and the
Liquidity Providers....................35
ARTICLE IV EXERCISE OF REMEDIES.........................42
SECTION 4.1. Directions from the Controlling Party..42
SECTION 4.2. Remedies Cumulative....................44
SECTION 4.3. Discontinuance of Proceedings..........44
SECTION 4.4. Right of Certificateholders to
Receive Payments Not to Be Impaired....44
SECTION 4.5. Undertaking for Costs..................45
ARTICLE V DUTIES OF THE SUBORDINATION AGENT; AGREEMENTS
OF TRUSTEES, ETC.........................................45
SECTION 5.1. Notice of Indenture Default or
Triggering Event.......................45
SECTION 5.2. Indemnification........................45
SECTION 5.3. No Duties Except as Specified in
Intercreditor Agreement................46
SECTION 5.4. Notice from the Liquidity Providers
and Trustees...........................46
ARTICLE VI THE SUBORDINATION AGENT......................46
SECTION 6.1. Authorization; Acceptance of Trusts
and Duties.............................46
SECTION 6.2. Absence of Duties......................47
SECTION 6.3. No Representations or Warranties as
to Documents...........................47
SECTION 6.4. No Segregation of Monies; No Interest..47
SECTION 6.5. Reliance; Agents; Advice of Counsel....47
SECTION 6.6. Capacity in Which Acting...............48
SECTION 6.7. Compensation...........................48
SECTION 6.8. May Become Certificateholder...........48
SECTION 6.9. Subordination Agent Required;
Eligibility............................48
SECTION 6.10. Money to Be Held in Trust.............49
ARTICLE VII INDEMNIFICATION OF SUBORDINATION AGENT......49
SECTION 7.1. Scope of Indemnification...............49
ARTICLE VIII SUCCESSOR SUBORDINATION AGENT..............50
SECTION 8.1. Replacement of Subordination Agent;
Appointment of Successor...............50
ARTICLE IX SUPPLEMENTS AND AMENDMENTS...................51
SECTION 9.1. Amendments, Waivers, etc...............51
SECTION 9.3. Effect of Supplemental Agreements......52
SECTION 9.4. Notice to Rating Agencies..............52
ARTICLE X MISCELLANEOUS.................................53
SECTION 10.1. Termination of Intercreditor
Agreement.............................53
SECTION 10.2. Intercreditor Agreement for Benefit
of Trustees, Liquidity Providers and
Subordination Agent...................53
SECTION 10.3. Notices...............................53
SECTION 10.4. Severability..........................55
SECTION 10.5. No Oral Modifications or
Continuing Waivers....................55
SECTION 10.6. Successors and Assigns................55
SECTION 10.7. Headings..............................55
SECTION 10.8. Counterpart Form......................55
SECTION 10.9. Subordination.........................55
SECTION 10.10. Governing Law........................57
SECTION 10.11. Submission to Jurisdiction;
Waiver of Jury Trial; Waiver
of Immunity..........................57
INTERCREDITOR AGREEMENT
INTERCREDITOR AGREEMENT dated as of August 31, 1999, among
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a
national banking association ("State Street"), not in its individual
capacity but solely as Trustee of each Trust (each as defined below); AIG
MATCHED FUNDING CORP, a corporation organized under the laws of the State
of Delaware ("AIGMFC"), as Class A Liquidity Provider, Class B Liquidity
Provider and Class C Liquidity Provider; and STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a national banking
association, not in its individual capacity except as expressly set forth
herein, but solely as Subordination Agent and trustee hereunder (in such
capacity, together with any successor appointed pursuant to Article VIII
hereof, the "Subordination Agent").
WHEREAS, all capitalized terms used herein shall have the
respective meanings referred to in Article I hereof;
WHEREAS, pursuant to each Indenture (i) in the case of each
Aircraft that is owned by US Airways at the time such Indenture is entered
into (the "Owned Aircraft"), US Airways will issue on a recourse basis
three series of Equipment Notes to finance the purchase of such Aircraft,
and (ii) in the case of each Aircraft that is leased to US Airways pursuant
to a related Lease at the time such Indenture is entered into (the "Leased
Aircraft"), the related Owner Trustee will issue on a nonrecourse basis
three series of Equipment Notes to finance the purchase of such Aircraft;
WHEREAS, pursuant to the Financing Agreements, each Trust
will acquire Equipment Notes having an interest rate equal to the interest
rate applicable to the Certificates to be issued by such Trust;
WHEREAS, pursuant to each Trust Agreement, the Trust created
thereby proposes to issue a single class of Certificates (a "Class")
bearing the interest rate and having the final distribution date described
in such Trust Agreement on the terms and subject to the conditions set
forth therein;
WHEREAS, pursuant to the Underwriting Agreement, the
Underwriters propose to purchase the Certificates issued by the Class A
Trust and the Class B Trust in the aggregate face amount set forth opposite
the name of such Trust on Schedule I thereto on the terms and subject to
the conditions set forth therein;
WHEREAS, pursuant to the Class C Purchase Agreement, Airbus
Industrie Financial Services ("AIFS") proposes to purchase all of the
Certificates issued by the Class C Trust on the terms and subject to the
conditions set forth therein;
WHEREAS, the Liquidity Provider proposes to enter into three
separate revolving credit agreements with the Subordination Agent, as agent
for the Trustee of each of the Class A Trust, the Class B Trust and the
Class C Trust, respectively, for the benefit of the Certificateholders of
such Trust; and
WHEREAS, it is a condition precedent to the obligations of
the Underwriters under the Underwriting Agreement that the Subordination
Agent, the Trustees and the Liquidity Providers agree to the terms of
subordination set forth in this Agreement in respect of each Class of
Certificates, and the Subordination Agent, the Trustees and the Liquidity
Provider, by entering into this Agreement, hereby acknowledge and agree to
such terms of subordination and the other provisions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, and of other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:
(1) the terms used herein that are defined in this Article
have the meanings assigned to them in this Article, and include the
plural as well as the singular;
(2) all references in this Agreement to designated
"Articles", "Sections" and other subdivisions are to the designated
Articles, Sections and other subdivisions of this Agreement;
(3) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not
to any particular Article, Section or other subdivision; and
(4) the term "including" shall mean "including without
limitation".
"Acceleration" means, with respect to the amounts payable in
respect of the Equipment Notes issued under any Indenture, such amounts
becoming immediately due and payable by declaration or otherwise.
"Accelerate", "Accelerated" and "Accelerating" have meanings correlative to
the foregoing.
"Adjusted Expected Distributions" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates (excluding interest, if
any, payable with respect to the Deposits related to such Trust)
and (y) the greater of:
(A) the difference between (x) the Pool Balance of such
Certificates as of the immediately preceding Distribution Date (or,
if the Current Distribution Date is the first Distribution Date,
the original aggregate face amount of the Certificates of such
Trust) and (y) the Pool Balance of such Certificates as of the
Current Distribution Date calculated on the basis that (i) the
principal of the Non-Performing Equipment Notes held in such Trust
has been paid in full and such payments have been distributed to
the holders of such Certificates, (ii) the principal of the
Performing Equipment Notes held in such Trust has been paid when
due (but without giving effect to any Acceleration of Performing
Equipment Notes) and such payments have been distributed to the
holders of such Certificates and (iii) the principal of any
Equipment Notes formerly held in such Trust that have been sold
pursuant to the terms hereof has been paid in full and such
payments have been distributed to the holders of such Certificates,
but without giving effect to any reduction in the Pool Balance as a
result of any distribution attributable to Deposits occurring after
the immediately preceding Distribution Date (or, if the Current
Distribution Date is the first Distribution Date, occurring after
the initial issuance of the Certificates of such Trust), and
(B) the amount of the excess, if any, of (i) the Pool
Balance of such Class of Certificates as of the immediately
preceding Distribution Date (or, if the Current Distribution Date
is the first Distribution Date, the original aggregate face amount
of the Certificates of such Trust), less the amount of the Deposits
for such Class of Certificates as of such preceding Distribution
Date (or, if the Current Distribution Date is the first
Distribution Date, the original aggregate amount of the Deposits
for such Class of Certificates) other than any portion of such
Deposits thereafter used to acquire Equipment Notes pursuant to the
Note Purchase Agreement, over (ii) the Aggregate LTV Collateral
Amount for such Class of Certificates for the Current Distribution
Date;
provided that, until the date of the initial LTV Appraisals, clause (B)
shall not apply.
For purposes of calculating Adjusted Expected Distributions
with respect to the Certificates of any Trust, any premium paid on the
Equipment Notes held in such Trust that has not been distributed to the
Certificateholders of such Trust (other than such premium or a portion
thereof applied to the payment of interest on the Certificates of such
Trust or the reduction of the Pool Balance of such Trust) shall be added to
the amount of Adjusted Expected Distributions.
"Advance", with respect to any Liquidity Facility, means any
Advances as defined in such Liquidity Facility.
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by or under common
control with such Person. For the purposes of this definition, "control"
means the power, directly or indirectly, to direct or cause the direction
of the management and policies of such Person whether through the ownership
of voting securities or by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Aggregate LTV Collateral Amount" for any Class of
Certificates for any Distribution Date means the sum of the applicable LTV
Collateral Amounts for each Leased Aircraft and Owned Aircraft, minus the
Pool Balance for each Class of Certificates, if any, senior to such Class,
after giving effect to any distribution of principal on such Distribution
Date with respect to such senior Class or Classes.
"AIFS" has the meaning assigned to such term in the recitals
to this Agreement.
"Aircraft" means, with respect to each Indenture, the
"Aircraft" referred to therein.
"Appraisal" means a current fair market value appraisal
(which may be a "desktop" appraisal) performed by any Appraiser or any
other nationally recognized appraiser on the basis of an arm's-length
transaction between an informed and willing purchaser under no compulsion
to buy and an informed and willing seller under no compulsion to sell and
both having knowledge of all relevant facts.
"Appraised Current Market Value" of any Leased Aircraft or
Owned Aircraft means the lower of the average and the median of the three
most recent Appraisals of such Aircraft.
"Appraisers" means Aircraft Information Services, Inc.,
AvSolutions, Inc. and Morten Beyer and Agnew, Inc.
"Available Amount" means, with respect to any Liquidity
Facility on any drawing date, subject to the proviso contained in the first
sentence of Section 3.6(g) hereof, an amount equal to (a) the Stated Amount
of such Liquidity Facility at such time, less (b) the aggregate amount of
each Interest Drawing honored by the Liquidity Provider under such
Liquidity Facility on or prior to such date which has not been reimbursed
or reinstated as of such date; provided that, following a Downgrade
Drawing, a Non-Extension Drawing or a Final Drawing under such Liquidity
Facility, the Available Amount of such Liquidity Facility shall be zero.
"Basic Agreement" means the Pass Through Trust Agreement
dated as of July 30, 1999 between US Airways, Inc., US Airways Group, Inc.,
and State Street Bank and Trust Company of Connecticut, National
Association.
"Business Day" means any day other than a Saturday or Sunday
or a day on which commercial banks are required or authorized to close in
Pittsburgh, Pennsylvania, New York, New York, or, so long as any
Certificate is outstanding, the city and state in which any Trustee, the
Subordination Agent or any Loan Trustee maintains its Corporate Trust
Office or receives and disburses funds, and that, solely with respect to
draws under any Liquidity Facility, also is a "Business Day" as defined in
such Liquidity Facility.
"Cash Collateral Account" means the Class A Cash Collateral
Account, the Class B Cash Collateral Account or the Class C Cash Collateral
Account, as applicable.
"Certificate" means a Class A Certificate, a Class B
Certificate or a Class C Certificate, as applicable.
"Certificateholder" means any holder of one or more
Certificates.
"Class" has the meaning assigned to such term in the
preliminary statements to this Agreement.
"Class A Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify,
into which all amounts drawn under the Class A Liquidity Facility pursuant
to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class A Certificateholder" means, at any time, any holder
of one or more Class A Certificates.
"Class A Certificates" means the certificates issued by the
Class A Trust, substantially in the form of Exhibit A to the Class A Trust
Agreement, and authenticated by the Class A Trustee, representing
fractional undivided interests in the Class A Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of
the Class A Trust Agreement.
"Class A Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination
Agent, as agent and trustee for the Class A Trustee, and the initial Class
A Liquidity Provider and, from and after the replacement of such agreement
pursuant hereto, the Replacement Liquidity Facility therefor, if any, in
each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class A Liquidity Provider" means AIGMFC , together with
any Replacement Liquidity Provider which has issued a Replacement Liquidity
Facility to replace any Class A Liquidity Facility pursuant to Section
3.6(e).
"Class A Trust" means the US Airways Pass Through Trust
1999-1A created and administered pursuant to the Class A Trust Agreement.
"Class A Trust Agreement" means the Basic Agreement, as
supplemented by the Supplement No. 1999-1A thereto dated as of the date
hereof, governing the creation and administration of the US Airways Pass
Through Trust 1999-1A and the issuance of the Class A Certificates, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class A Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except
as expressly set forth in the Class A Trust Agreement, but solely as
trustee under the Class A Trust Agreement, together with any successor
trustee appointed pursuant thereto.
"Class B Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify,
into which all amounts drawn under the Class B Liquidity Facility pursuant
to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class B Certificateholder" means, at any time, any holder
of one or more Class B Certificates.
"Class B Certificates" means the certificates issued by the
Class B Trust, substantially in the form of Exhibit A to the Class B Trust
Agreement, and authenticated by the Class B Trustee, representing
fractional undivided interests in the Class B Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of
the Class B Trust Agreement.
"Class B Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination
Agent, as agent and trustee for the Class B Trustee, and the initial Class
B Liquidity Provider, and, from and after the replacement of such Agreement
pursuant hereto, the Replacement Liquidity Facility therefor, if any, in
each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class B Liquidity Provider" means AIGMFC , together with
any Replacement Liquidity Provider which has issued a Replacement Liquidity
Facility to replace any Class B Liquidity Facility pursuant to Section
3.6(e).
"Class B Trust" means the US Airways Pass Through Trust
1999-1B created and administered pursuant to the Class B Trust Agreement.
"Class B Trust Agreement" means the Basic Agreement, as
supplemented by the Supplement No. 1999-1B thereto dated as of the date
hereof, governing the creation and administration of the US Airways Pass
Through Trust 1999-1B and the issuance of the Class B Certificates, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class B Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except
as expressly set forth in the Class B Trust Agreement, but solely as
trustee under the Class B Trust Agreement, together with any successor
trustee appointed pursuant thereto.
"Class C Cash Collateral Account" means an Eligible Deposit
Account in the name of the Subordination Agent maintained at an Eligible
Institution, which shall be the Subordination Agent if it shall so qualify,
into which all amounts drawn under the Class C Liquidity Facility pursuant
to Section 3.6(c), 3.6(d) or 3.6(i) shall be deposited.
"Class C Certificateholder" means, at any time, any holder
of one or more Class C Certificates.
"Class C Certificates" means the certificates issued by the
Class C Trust, substantially in the form of Exhibit A to the Class C Trust
Agreement, and authenticated by the Class C Trustee, representing
fractional undivided interests in the Class C Trust, and any certificates
issued in exchange therefor or replacement thereof pursuant to the terms of
the Class C Trust Agreement.
"Class C Liquidity Facility" means, initially, the Revolving
Credit Agreement dated as of the date hereof, between the Subordination
Agent, as agent and trustee for the Class C Trustee, and the initial Class
C Liquidity Provider, and, from and after the replacement of such Agreement
pursuant hereto, the Replacement Liquidity Facility therefor, if any, in
each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class C Liquidity Provider" means AIGMFC , together with
any Replacement Liquidity Provider which has issued a Replacement Liquidity
Facility to replace any Class C Liquidity Facility pursuant to Section
3.6(e).
"Class C Purchase Agreement" means the Purchase Agreement
dated August 31, 1999 between US Airways and AIFS relating to the purchase
of all of the Class C Certificates by AIFS, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Class C Trust" means the US Airways Pass Through Trust
1999-1C created and administered pursuant to the Class C Trust Agreement.
"Class C Trust Agreement" means the Basic Agreement, as
supplemented by the Supplement No. 1999-1C thereto dated as of the date
hereof, governing the creation and administration of the US Airways Pass
Through Trust 1999-1C and the issuance of the Class C Certificates, as the
same may be amended, supplemented or otherwise modified from time to time
in accordance with its terms.
"Class C Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, not in its individual capacity except
as expressly set forth in the Class C Trust Agreement, but solely as
trustee under the Class C Trust Agreement, together with any successor
trustee appointed pursuant thereto.
"Closing Date" means August 31, 1999.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder.
"Collection Account" means the Eligible Deposit Account
established by the Subordination Agent pursuant to Section 2.2 which the
Subordination Agent shall make deposits in and withdrawals from in
accordance with this Agreement.
"Controlling Party" means the Person entitled to act as such
pursuant to the terms of Section 2.6.
"Corporate Trust Office" means, with respect to any Trustee,
the Subordination Agent or any Loan Trustee, the office of such Person in
the city at which, at any particular time, its corporate trust business
shall be principally administered.
"Current Distribution Date" means a Distribution Date
specified as a reference date for calculating the Expected Distributions or
the Adjusted Expected Distributions with respect to the Certificates of any
Trust as of such Distribution Date.
"Delivery Period Expiry Date" means the earlier of (a) July
20, 2000, and (b) the date on which Equipment Notes with respect to all New
Aircraft (or Substitute Aircraft in lieu thereof) have been purchased by
the Trusts in accordance with the Note Purchase Agreement.
"Deposit Agreement" shall mean, with respect to any Class,
the Deposit Agreement pertaining to such Class dated the date hereof
between the Escrow Agent, and the Depositary, as the same may be amended,
modified or supplemented from time to time in accordance with the terms
thereof.
"Depositary" means ABN AMRO Bank N.V., acting through its
Chicago branch, as depositary under each Deposit Agreement.
"Deposits" with respect to any Class, shall have the meaning
set forth in the Deposit Agreement pertaining to such Class.
"Designated Representatives" means the Subordination Agent
Representatives, the Trustee Representatives and the LP Representatives
identified under Section 2.5.
"Distribution Date" means a Regular Distribution Date or a
Special Distribution Date.
"Dollars" or "$" means United States dollars.
"Downgrade Drawing" has the meaning assigned to such term in
Section 3.6(c).
"Downgraded Facility" has the meaning assigned to such term
in Section 3.6(c).
"Drawing" means an Interest Drawing, a Final Drawing, a
Non-Extension Drawing or a Downgrade Drawing, as the case may be.
"Eligible Deposit Account" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with
the corporate trust department of a depository institution organized under
the laws of the United States of America or any one of the states thereof
or the District of Columbia (or any U.S. branch of a foreign bank), having
corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the securities of such depository institution
has a long-term unsecured debt rating from each Rating Agency of at least
A-3 or its equivalent. An Eligible Deposit Account may be maintained with a
Liquidity Provider so long as such Liquidity Provider is an Eligible
Institution; provided that such Liquidity Provider shall have waived all
rights of set-off and counterclaim with respect to such account.
"Eligible Institution" means (a) the corporate trust
department of the Subordination Agent or any Trustee, as applicable, or (b)
a depository institution organized under the laws of the United States of
America or any one of the states thereof or the District of Columbia (or
any U.S. branch of a foreign bank), which has a long-term unsecured debt
rating from each Rating Agency of at least A-3 or its equivalent.
"Eligible Investments" means (a) investments in obligations
of, or guaranteed by, the United States Government having maturities no
later than 90 days following the date of such investment, (b) investments
in open market commercial paper of any corporation incorporated under the
laws of the United States of America or any state thereof with a short-term
unsecured debt rating issued by Moody's and S&P of at least A-1 and P-1,
respectively, having maturities no later than 90 days following the date of
such investment or (c) investments in negotiable certificates of deposit,
time deposits, banker's acceptances, commercial paper or other direct
obligations of, or obligations guaranteed by, commercial banks organized
under the laws of the United States or of any political subdivision thereof
(or any U.S. branch of a foreign bank) with issuer ratings of at least B/C
by Thomson Bankwatch, having maturities no later than 90 days following the
date of such investment; provided, however, that (x) all Eligible
Investments that are bank obligations shall be denominated in U.S. dollars;
and (y) the aggregate amount of Eligible Investments at any one time that
are bank obligations issued by any one bank shall not be in excess of 5% of
such bank's capital surplus; provided further that (1) any investment of
the types described in clauses (a), (b) and (c) above may be made through a
repurchase agreement in commercially reasonable form with a bank or other
financial institution qualifying as an Eligible Institution so long as such
investment is held by a third party custodian also qualifying as an
Eligible Institution, and (2) all such investments set forth in clause (a),
(b) or (c) above mature no later than the Business Day immediately
preceding the next Regular Distribution Date; provided further, however,
that in the case of any Eligible Investment issued by a domestic branch of
a foreign bank, the income from such investment shall be from sources
within the United States for purposes of the Code. Notwithstanding the
foregoing, no investment of the types described in clause (b) above which
is issued or guaranteed by US Airways or any of its respective Affiliates,
and no investment in the obligations of any one bank in excess of
$10,000,000, shall be an Eligible Investment unless written confirmation
shall have been received from each Rating Agency that the making of such
investment will not results in a withdrawal or downgrading of the ratings
of the Certificates.
"Equipment Notes" means, at any time, the Series A Equipment
Notes, the Series B Equipment Notes and the Series C Equipment Notes,
collectively, and in each case, any Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of the Indentures.
"Escrow Agent" means First Security Bank, National
Association, as escrow agent under each Escrow and Paying Agent Agreement,
together with its successors in such capacity.
"Escrow and Paying Agent Agreement" shall mean, with respect
to any Class, the Escrow and Paying Agent Agreement pertaining to such
Class dated as of the date hereof between the Escrow Agent, the
Underwriters (in the case of the Class A Certificates and the Class B
Certificates) or AIFS (in the case of the Class C Certificates), the
Trustee for such Class and the Paying Agent, as the same may be amended,
modified or supplemented from time to time in accordance with the terms
thereof.
"Expected Distributions" means, with respect to the
Certificates of any Trust on any Current Distribution Date, the sum of (x)
accrued and unpaid interest on such Certificates (excluding interest, if
any, payable with respect to the Deposits related to such Trust) and (y)
the difference between (A) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (or, if the Current Distribution
Date is the first Distribution Date, the original aggregate face amount of
the Certificates of such Trust) and (B) the Pool Balance of such
Certificates as of the Current Distribution Date calculated on the basis
that (i) the principal of the Equipment Notes held in such Trust has been
paid when due (whether at stated maturity or upon redemption, prepayment,
purchase, Acceleration or otherwise) and such payments have been
distributed to the holders of such Certificates and (ii) the principal of
any Equipment Notes formerly held in such Trust that have been sold
pursuant to the terms hereof has been paid in full and such payments have
been distributed to the holders of such Certificates, but without giving
effect to any reduction in the Pool Balance as a result of any distribution
attributable to Deposits occurring after the immediately preceding
Distribution Date (or, if the Current Distribution Date is the first
Distribution Date, occurring after the initial issuance of the Certificates
of such Trust). For purposes of calculating Expected Distributions with
respect to the Certificates of any Trust, any premium paid on the Equipment
Notes held in such Trust which has not been distributed to the
Certificateholders of such Trust (other than such premium or a portion
thereof applied to the payment of interest on the Certificates of such
Trust or the reduction of the Pool Balance of such Trust) shall be added to
the amount of such Expected Distributions.
"Expiry Date" with respect to any Liquidity Facility, shall
have the meaning set forth in such Liquidity Facility.
"Facility Office" means, with respect to any Liquidity
Facility, the Facility Office of the Liquidity Provider thereunder,
presently located at Westport, Connecticut for AIGMFC, or such other
Facility Office as such Liquidity Provider from time to time shall notify
the applicable Trustee as its Facility Office under any such Liquidity
Facility, provided that such Liquidity Provider shall not change its
Facility Office to a Facility Office outside the United States of America
except in accordance with Section 3.01, 3.02 or 3.03 of any such Liquidity
Facility.
"Fee Letter" means the Fee Letter dated as of the date
hereof between AIGMFC and the Subordination Agent with respect to the
initial Liquidity Facilities and any fee letter entered into between the
Subordination Agent and any Replacement Liquidity Provider.
"Final Distributions" means, with respect to the
Certificates of any Trust on any Distribution Date, the sum of (x) the
aggregate amount of all accrued and unpaid interest on such Certificates
(excluding interest, if any, payable with respect to the Deposits relating
to such Trust) and (y) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (less the amount of the Deposits
for such Class of Certificates as of such preceding Distribution Date other
than any portion of such Deposits thereafter used to acquire Equipment
Notes pursuant to the Note Purchase Agreement). For purposes of calculating
Final Distributions with respect to the Certificates of any Trust, any
premium paid on the Equipment Notes held in such Trust which has not been
distributed to the Certificateholders of such Trust (other than such
premium or a portion thereof applied to the payment of interest on the
Certificates of such Trust or the reduction of the Pool Balance of such
Trust) shall be added to the amount of such Final Distributions.
"Final Drawing" has the meaning assigned to such term in
Section 3.6(i).
"Final Legal Distribution Date" means (i) with respect to
the Class A Certificates, July 20, 2020, (ii) with respect to the Class B
Certificates, July 20, 2020, and (iii) with respect to the Class C
Certificates, July 20, 2019.
"Financing Agreement" means each of the Participation
Agreements and the Note Purchase Agreement.
"Indenture" means each of the Trust Indentures entered into
by the Loan Trustee, and the Owner Trustee or US Airways, pursuant to the
Note Purchase Agreement, in each case as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Indenture Default" means, with respect to any Indenture,
any Event of Default (as such term is defined in such Indenture)
thereunder.
"Interest Drawing" has the meaning assigned to such term in
Section 3.6(a).
"Interest Payment Date" means, with respect to any Liquidity
Facility, each date on which interest is due and payable under Section
3.07(c) or 3.07(d) of such Liquidity Facility on a Downgrade Drawing,
Non-Extension Drawing or Final Drawing.
"Investment Earnings" means investment earnings on funds on
deposit in the Trust Accounts net of losses and investment expenses of the
Subordination Agent in making such investments.
"Lease" means, with respect to each Indenture pertaining to
a Leased Aircraft, the "Lease" referred to therein.
"Leased Aircraft" has the meaning assigned to such term in
the preliminary statements of this Agreement.
"Lien" means any mortgage, pledge, lien, charge, claim,
disposition of title, encumbrance, lease, sublease, sub-sublease or
security interest of any kind, including, without limitation, any thereof
arising under any conditional sales or other title retention agreement.
"Liquidity Event of Default" with respect to any Liquidity
Facility, has the meaning assigned to such term in such Liquidity Facility.
"Liquidity Expenses" means all Liquidity Obligations other
than (i) the principal amount of any Drawings under the Liquidity
Facilities and (ii) any interest accrued on any Liquidity Obligations.
"Liquidity Facility" means, at any time, the Class A
Liquidity Facility, the Class B Liquidity Facility or the Class C Liquidity
Facility.
"Liquidity Obligations" means all principal, interest, fees
and other amounts owing to the Liquidity Providers under the Liquidity
Facilities, Section 6(c) of the Participation Agreements or the Fee Letter.
"Liquidity Provider" means, at any time, any Class A
Liquidity Provider, any Class B Liquidity Provider or any Class C Liquidity
Provider, as applicable.
"Loan Trustee" means, with respect to any Indenture, the
loan trustee thereunder.
"LP Incumbency Certificate" has the meaning assigned to such
term in Section 2.5(c).
"LP Representatives" has the meaning assigned to such term
in Section 2.5(c).
"LTV Appraisals" has the meaning assigned to such term in
Section 4.1(a).
"LTV Collateral Amount" of any Leased Aircraft or Owned
Aircraft for any Class of Certificates means, as of any Distribution Date,
the lesser of (i) the LTV Ratio for such Class of Certificates multiplied
by the Appraised Current Market Value of such Aircraft (or with respect to
any such Aircraft which has suffered an Event of Loss under and as defined
in the relevant Lease (in the case of a Leased Aircraft) or Indenture (in
the case of an Owned Aircraft), the amount of the insurance proceeds paid
to the related Loan Trustee in respect thereof to the extent then held by
such Loan Trustee (and/or on deposit in the Special Payments Account) or
payable to such Loan Trustee in respect thereof) and (ii) the outstanding
principal amount of the Equipment Notes secured by such Aircraft after
giving effect to any principal payments of such Equipment Notes on or
before such Distribution Date.
"LTV Ratio" means for the Class A Certificates 40.8%, for
the Class B Certificates 50.0% and for the Class C Certificates 63.0%.
"Minimum Sale Price" means, with respect to any Aircraft or
the Equipment Notes issued in respect of such Aircraft, at any time, the
lesser of (a) 75% of the Appraised Current Market Value of such Aircraft
and (b) the aggregate outstanding principal amount of such Equipment Notes,
plus accrued and unpaid interest thereon.
"Moody's" means Moody's Investors Service, Inc.
"New Aircraft" shall have the meaning set forth in the Note
Purchase Agreement.
"Non-Controlling Party" means, at any time, any Trustee or
Liquidity Provider which is not the Controlling Party at such time.
"Non-Extended Facility" has the meaning assigned to such
term in Section 3.6(d).
"Non-Extension Drawing" has the meaning assigned to such
term in Section 3.6(d).
"Non-Performing Equipment Note" means an Equipment Note
issued pursuant to an Indenture that is not a Performing Equipment Note.
"Note Purchase Agreement" means the Note Purchase Agreement
dated as of the date hereof, among US Airways, each Trustee, the Escrow
Agent, the Subordination Agent and the Paying Agent.
"Officer's Certificate" of any Person means a certification
signed by a Responsible Officer of such Person.
"Operative Agreements" means this Agreement, the Liquidity
Facilities, the Indentures, the Trust Agreements, the Underwriting
Agreement, the Class C Purchase Agreement, the Financing Agreements, the
Leases, the Fee Letter, the Equipment Notes and the Certificates, together
with all exhibits and schedules included with any of the foregoing and each
of the other documents and instruments referred to in the definitions of
"Operative Documents" contained in the Leases or, in the case of any Owned
Aircraft, the relevant Indenture.
"Outstanding" means, when used with respect to each Class of
Certificates, as of the date of determination, all Certificates of such
Class theretofore authenticated and delivered under the related Trust
Agreement, except:
(i) Certificates of such Class theretofore canceled by the
Registrar (as defined in such Trust Agreement) or delivered to the
Trustee thereunder or such Registrar for cancellation;
(ii) Certificates of such Class for which money in the full
amount required to make the final distribution with respect to such
Certificates pursuant to Section 11.01 of such Trust Agreement has
been theretofore deposited with the related Trustee in trust for
the holders of such Certificates as provided in Section 4.01 of
such Trust Agreement pending distribution of such money to such
Certificateholders pursuant to such final distribution payment; and
(iii) Certificates of such Class in exchange for or in lieu
of which other Certificates have been authenticated and delivered
pursuant to such Trust Agreement;
provided, however, that in determining whether the holders of the requisite
Outstanding amount of such Certificates have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, any
Certificates owned by US Airways or any of its Affiliates shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether such Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only
Certificates that such Trustee knows to be so owned shall be so
disregarded. Certificates so owned that have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction
of the applicable Trustee the pledgee's right so to act with respect to
such Certificates and that the pledgee is not US Airways or any of its
Affiliates.
"Overdue Scheduled Payment" means any Scheduled Payment
which is not in fact received by the Subordination Agent within five days
after the Scheduled Payment Date relating thereto.
"Owned Aircraft" has the meaning assigned to such term in
the preliminary statements of this Agreement.
"Owner Trustee" means, with respect to any Indenture
pertaining to a Leased Aircraft, the Owner Trustee (as defined therein) not
in its individual capacity but solely as trustee under the related owner
trust agreement, together with any successor trustee appointed pursuant
to such owner trust agreement.
"Participation Agreement" means, with respect to each
Indenture, the "Participation Agreement" referred to therein.
"Payee" has the meaning assigned to such term in Section
2.4(e).
"Paying Agent" means State Street Bank and Trust Company of
Connecticut, National Association, as paying agent under each Escrow and
Paying Agent Agreement, together with its successors in such capacity.
"Performing Equipment Note" means an Equipment Note issued
pursuant to an Indenture with respect to which no payment default has
occurred and is continuing (without giving effect to any Acceleration);
provided that in the event of a bankruptcy proceeding involving US Airways
under Title 11 of the United States Code (the "Bankruptcy Code"), (i) any
payment default existing during the 60-day period under Section
1110(a)(1)(A) of the Bankruptcy Code (or such longer period as may apply
under Section 1110(b) of the Bankruptcy Code) (the "Section 1110 Period")
shall not be taken into consideration, unless during the Section 1110
Period the trustee in such proceeding or US Airways refuses to assume or
agree to perform its obligations under the Lease related to such Equipment
Note (in the case of a Leased Aircraft) or under the Indenture related to
such Equipment Note (in the case of an Owned Aircraft) and (ii) any payment
default occurring after the date of the order of relief in such proceeding
shall not be taken into consideration if such payment default is cured
under Section 1110(a)(1)(B) of the Bankruptcy Code before the later of 30
days after the date of such default or the expiration of the Section 1110
Period.
"Performing Note Deficiency" means any time that less than
65% of the then aggregate outstanding principal amount of all Equipment
Notes are Performing Equipment Notes.
"Person" means any individual, corporation, partnership,
joint venture, association, limited liability company, joint-stock company,
trust, trustee, unincorporated organization or government or any agency or
political subdivision thereof.
"Pool Balance" means, with respect to each Trust or the
Certificates issued by any Trust, as of any date, (i) the original
aggregate face amount of the Certificates of such Trust less (ii) the
aggregate amount of all payments made in respect of the Certificates of
such Trust or in respect of Deposits relating to such Trust other than
payments made in respect of interest or premium thereon or reimbursement of
any costs and expenses in connection therewith. The Pool Balance for each
Trust or for the Certificates issued by any Trust as of any Distribution
Date shall be computed after giving effect to any special distribution with
respect to unused Deposits, payment of principal of the Equipment Notes or
payment with respect to other Trust Property held in such Trust and the
distribution thereof to be made on that date.
"Proceeding" means any suit in equity, action at law or
other judicial or administrative proceeding.
"PTC Event of Default" means, with respect to each Trust
Agreement, the failure to pay within 10 Business Days of the due date
thereof: (i) the outstanding Pool Balance of the applicable Class of
Certificates on the Final Legal Distribution Date for such Class or (ii)
interest due on such Certificates on any Distribution Date (unless the
Subordination Agent shall have made an Interest Drawing, or a withdrawal
from the Cash Collateral Account, with respect thereto in an aggregate
amount sufficient to pay such interest and shall have distributed such
amount to the Trustee entitled thereto).
"Rating Agencies" means, collectively, at any time, each
nationally recognized rating agency which shall have been requested by US
Airways to rate the Certificates and which shall then be rating the
Certificates. The initial Rating Agencies will be Moody's and Standard &
Poor's.
"Ratings Confirmation" means, with respect to any action
proposed to be taken, a written confirmation from each of the Rating
Agencies that such action would not result in (i) a reduction of the rating
for any Class of Certificates below the then current rating for such Class
of Certificates or (ii) a withdrawal or suspension of the rating of any
Class of Certificates.
"Regular Distribution Dates" means each January 20 and July
20, commencing on January 20, 2000; provided, however, that, if any such
day shall not be a Business Day, the related distribution shall be made on
the next succeeding Business Day without additional interest.
"Replacement Liquidity Facility" means, for any Liquidity
Facility, an irrevocable revolving credit agreement (or agreements) in
substantially the form of the replaced Liquidity Facility, including
reinstatement provisions, or in such other form (which may include a letter
of credit) as shall permit the Rating Agencies to confirm in writing their
respective ratings then in effect for the related Certificates (before
downgrading of such ratings, if any, as a result of the downgrading of the
applicable Liquidity Provider), in a face amount (or in an aggregate face
amount) equal to the amount of interest payable on the Certificates of such
Trust (at the Stated Interest Rate for such Trust, and without regard to
expected future principal payments) on the three Regular Distribution Dates
following the date of replacement of such Liquidity Facility and issued by
a Person (or Persons) having unsecured short-term debt ratings issued by
both Rating Agencies which are equal to or higher than the Threshold
Rating. Without limitation of the form that a Replacement Liquidity
Facility otherwise may have pursuant to the preceding sentence, a
Replacement Liquidity Facility for any Class of Certificates may have a
stated expiration date earlier than 15 days after the Final Legal
Distribution Date of such Class of Certificates so long as such Replacement
Liquidity Facility provides for a Non-Extension Drawing as contemplated by
Section 3.6(d) hereof.
"Replacement Liquidity Provider" means a Person (or Persons)
who issues a Replacement Liquidity Facility.
"Required Amount" means, with respect to each Liquidity
Facility, or the Cash Collateral Account, for any Class, for any day, the
sum of the aggregate amount of interest, calculated at the rate per annum
equal to the Stated Interest Rate for the related Class of Certificates,
that would be payable on such Class of Certificates on each of the three
successive Regular Distribution Dates immediately following such day or, if
such day is a Regular Distribution Date, on such day and the succeeding two
Regular Distribution Dates, in each case calculated on the basis of the
Pool Balance of such Class of Certificates on such date and without regard
to expected future payments of principal on such Class of Certificates.
"Responsible Officer" means (i) with respect to the
Subordination Agent and each of the Trustees, any officer in the corporate
trust administration department of the Subordination Agent or such Trustee
or any other officer customarily performing functions similar to those
performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of
his knowledge of and familiarity with a particular subject, and (ii) with
respect to each Liquidity Provider, any authorized officer of such
Liquidity Provider.
"Scheduled Payment" means, with respect to any Equipment
Note, (i) any payment of principal or interest on such Equipment Note
(other than an Overdue Scheduled Payment) due from the obligor thereon or
(ii) any payment of interest on the corresponding Class of Certificates
with funds drawn under any Liquidity Facility, which payment represents the
installment of principal at the stated maturity of such installment of
principal on such Equipment Note, the payment of regularly scheduled
interest accrued on the unpaid principal amount of such Equipment Note, or
both; provided that any payment of principal of, premium, if any, or
interest resulting from the redemption or purchase of any Equipment Note
shall not constitute a Scheduled Payment.
"Scheduled Payment Date" means, with respect to any
Scheduled Payment, the date on which such Scheduled Payment is scheduled to
be made.
"Section 2.4(b) Fraction" has the meaning assigned to such
term in Section 2.4(b).
"Series A Equipment Notes" means the 8.36% Series A
Equipment Notes issued pursuant to any Indenture by the related Owner
Trustee or US Airways, as the case may be, and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Series B Equipment Notes" means the 9.01% Series B
Equipment Notes issued pursuant to any Indenture by the related Owner
Trustee or US Airways, as the case may be, and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Series C Equipment Notes" means the 7.96% Series C
Equipment Notes issued pursuant to any Indenture by the related Owner
Trustee or US Airways, as the case may be, and authenticated by the Loan
Trustee thereunder, and any such Equipment Notes issued in exchange
therefor or replacement thereof pursuant to the terms of such Indenture.
"Special Distribution Date" means, with respect to any
Special Payment, the date chosen by the Subordination Agent pursuant to
Section 2.4(a) for the distribution of such Special Payment in accordance
with this Agreement.
"Special Payment" means any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note, Trust
Indenture Estate or Collateral (as defined, where applicable, in each
Indenture).
"Special Payments Account" means the Eligible Deposit
Account created pursuant to Section 2.2 as a sub-account to the Collection
Account.
"Standard & Poor's" means Standard & Poor's Ratings
Services, a division of The McGraw-Hill Companies, Inc.
"State Street" has the meaning assigned to such terms in the
preliminary statements to this Agreement.
"Stated Amount" with respect to any Liquidity Facility,
means the Maximum Commitment (as defined in such Liquidity Facility) of the
applicable Liquidity Provider thereunder.
"Stated Expiration Date" has the meaning specified in
Section 3.6(d).
"Stated Interest Rate" means (i) with respect to the Class A
Certificates, 8.36% per annum, (ii) with respect to the Class B
Certificates, 9.01% per annum and (iii) with respect to the Class C
Certificates, 7.96% per annum.
"Subordination Agent" has the meaning assigned to it in the
preliminary statements to this Agreement.
"Subordination Agent Incumbency Certificate" has the meaning
assigned to such term in Section 2.5(a).
"Subordination Agent Representatives" has the meaning
assigned to such term in Section 2.5(a).
"Substitute Aircraft" shall have the meaning set forth in
the Note Purchase Agreement.
"Tax" and "Taxes" mean any and all taxes, fees, levies,
duties, tariffs, imposts, and other charges of any kind (together with any
and all interest, penalties, loss, damage, liability, expense, additions to
tax and additional amounts or costs incurred or imposed with respect
thereto) imposed or otherwise assessed by the United States of America or
by any state, local or foreign government (or any subdivision or agency
thereof) or other taxing authority, including, without limitation: taxes or
other charges on or with respect to income, franchises, windfall or other
profits, gross receipts, property, sales, use, capital stock, payroll,
employment, social security, workers' compensation, unemployment
compensation, or net worth and similar charges; taxes or other charges in
the nature of excise, withholding, ad valorem, stamp, transfer, value
added, taxes on goods and services, gains taxes, license, registration and
documentation fees, customs duties, tariffs, and similar charges.
"Termination Notice" with respect to any Liquidity Facility
has the meaning assigned to such term in such Liquidity Facility.
"Threshold Rating" means the short-term unsecured debt
rating of P-1 by Moody's and A-1+ by Standard & Poor's, in the case of the
Class A Liquidity Provider and the Class B Liquidity Provider, and the
short-term unsecured debt rating of P-1 by Moody's and A-1 by Standard &
Poor's, in the case of the Class C Liquidity Provider.
"Treasury Regulations" means regulations, including proposed
or temporary regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
"Triggering Event" means (x) the occurrence of an Indenture
Default under all of the Indentures resulting in a PTC Event of Default
with respect to the most senior Class of Certificates then Outstanding, (y)
the Acceleration of all of the outstanding Equipment Notes (provided that,
with respect to the period prior to the Delivery Period Expiry Date, the
aggregate principal balance of such Equipment Notes is in excess of
$300,000,000) or (z) the occurrence of a US Airways Bankruptcy Event.
"Trust" means any of the Class A Trust, the Class B Trust or
the Class C Trust.
"Trust Accounts" has the meaning assigned to such term in
Section 2.2(a).
"Trust Agreement" means any of the Class A Trust Agreement,
the Class B Trust Agreement or the Class C Trust Agreement.
"Trust Property" with respect to any Trust, has the meaning
set forth in the Trust Agreement for such Trust.
"Trustee" means any of the Class A Trustee, the Class B
Trustee or the Class C Trustee.
"Trustee Incumbency Certificate" has the meaning assigned to
such term in Section 2.5(b).
"Trustee Representatives" has the meaning assigned to such
term in Section 2.5(b).
"Underwriters" means Credit Suisse First Boston Corporation,
Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities Corporation,
Deutsche Bank Securities Inc. and Salomon Smith Barney Inc.
"Underwriting Agreement" means the Underwriting Agreement
dated August 24, 1999 among the Underwriters and US Airways, relating to
the purchase of the Class A Certificates and the Class B Certificates by
the Underwriters, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"US Airways" means US Airways, Inc., a Delaware corporation,
and its successors and assigns.
"US Airways Bankruptcy Event" means the occurrence and
continuation of any of the following:
(a) US Airways shall consent to the appointment of or the
taking of possession by a receiver, trustee or liquidator of itself
or of a substantial part of its property, or US Airways shall admit
in writing its inability to pay its debts generally as they come
due, or does not pay its debts generally as they become due or
shall make a general assignment for the benefit of creditors, or US
Airways shall file a voluntary petition in bankruptcy or a
voluntary petition or an answer seeking reorganization, liquidation
or other relief in a case under any bankruptcy laws or other
insolvency laws (as in effect at such time) or an answer admitting
the material allegations of a petition filed against US Airways in
any such case, or US Airways shall seek relief by voluntary
petition, answer or consent, under the provisions of any other
bankruptcy or other similar law providing for the reorganization or
winding-up of corporations (as in effect at such time) or US
Airways shall seek an agreement, composition, extension or
adjustment with its creditors under such laws, or US Airways' board
of directors shall adopt a resolution authorizing corporate action
in furtherance of any of the foregoing; or
(b) an order, judgment or decree shall be entered by any
court of competent jurisdiction appointing, without the consent of
US Airways, a receiver, trustee or liquidator of US Airways or of
any substantial part of its property, or any substantial part of
the property of US Airways shall be sequestered, or granting any
other relief in respect of US Airways as a debtor under any
bankruptcy laws or other insolvency laws (as in effect at such
time), and any such order, judgment or decree of appointment or
sequestration shall remain in force undismissed, unstayed and
unvacated for a period of 60 days after the date of entry thereof;
or
(c) a petition against US Airways in a case under any
bankruptcy laws or other insolvency laws (as in effect at such
time) is filed and not withdrawn or dismissed within 60 days
thereafter, or if, under the provisions of any law providing for
reorganization or winding-up of corporations which may apply to US
Airways, any court of competent jurisdiction assumes jurisdiction,
custody or control of US Airways or of any substantial part of its
property and such jurisdiction, custody or control remains in force
unrelinquished, unstayed and unterminated for a period of 60 days.
"US Airways Provisions" has the meaning specified in Section
9.1(a).
"Written Notice" means, from the Subordination Agent, any
Trustee or Liquidity Provider, a written instrument executed by the
Designated Representative of such Person. An invoice delivered by a
Liquidity Provider pursuant to Section 3.1 in accordance with its normal
invoicing procedures shall constitute Written Notice under such Section.
ARTICLE II
TRUST ACCOUNTS; CONTROLLING PARTY
SECTION 2.1. Agreement to Terms of Subordination; Payments
from Monies Received Only. (a) Each Trustee hereby acknowledges and agrees
to the terms of subordination and distribution set forth in this Agreement
in respect of each Class of Certificates and agrees to enforce such
provisions and cause all payments in respect of the Equipment Notes and the
Liquidity Facilities to be applied in accordance with the terms of this
Agreement. In addition, each Trustee hereby agrees to cause the Equipment
Notes purchased by the related Trust to be registered in the name of the
Subordination Agent or its nominee, as agent and trustee for such Trustee,
to be held in trust by the Subordination Agent solely for the purpose of
facilitating the enforcement of the subordination and other provisions of
this Agreement.
(b) Except as otherwise expressly provided in the next
succeeding sentence of this Section 2.1, all payments to be made by the
Subordination Agent hereunder shall be made only from amounts received by
it that constitute Scheduled Payments, Special Payments, payments under
Section 6(b) of the Participation Agreements with respect to Owned
Aircraft, or payments under Section 6(c) of the Participation Agreement
with respect to Leased Aircraft or payments under Section 7 of the Note
Purchase Agreement, and only to the extent that the Subordination Agent
shall have received sufficient income or proceeds therefrom to enable it to
make such payments in accordance with the terms hereof. Each of the
Trustees and the Subordination Agent hereby agrees and, as provided in each
Trust Agreement, each Certificateholder, by its acceptance of a
Certificate, and each Liquidity Provider, by entering into the Liquidity
Facility to which it is a party, has agreed to look solely to such amounts
to the extent available for distribution to it as provided in this
Agreement and to the relevant Deposits and that none of the Trustees, Owner
Trustees, Loan Trustees, Owner Participants nor the Subordination Agent is
personally liable to any of them for any amounts payable or any liability
under this Agreement, any Trust Agreement, any Liquidity Facility or such
Certificate, except (in the case of the Subordination Agent) as expressly
provided herein or (in the case of the Trustees) as expressly provided in
each Trust Agreement or (in the case of the Owner Trustees and the Loan
Trustees) as expressly provided in any Operative Agreement.
SECTION 2.2. Trust Accounts. (a) Upon the execution of this
Agreement, the Subordination Agent shall establish and maintain in its name
(i) the Collection Account as an Eligible Deposit Account, bearing a
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Trustees, the Certificateholders and the
Liquidity Providers, and (ii) as a sub-account in the Collection Account,
the Special Payments Account as an Eligible Deposit Account, bearing a
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Trustees, the Certificateholders and the
Liquidity Providers. The Subordination Agent shall establish and maintain
the Cash Collateral Accounts pursuant to and under the circumstances set
forth in Section 3.6(f) hereof. Upon such establishment and maintenance
under Section 3.6(f) hereof, the Cash Collateral Accounts shall, together
with the Collection Account, constitute the "Trust Accounts" hereunder.
(b) Funds on deposit in the Trust Accounts shall be invested
and reinvested by the Subordination Agent in Eligible Investments selected
by the Subordination Agent if such investments are reasonably available and
have maturities no later than the earlier of (i) 90 days following the date
of such investment and (ii) the Business Day immediately preceding the
Regular Distribution Date or the date of the related distribution pursuant
to Section 2.4 hereof, as the case may be, next following the date of such
investment; (or, in the case of any amount on deposit in the Cash
Collateral Account with respect to any Liquidity Facility (with respect to
such Liquidity Facility, the "Relevant Amount"), (A) in the case of a
portion of the Relevant Amount equal to the amount scheduled to be paid to
the Liquidity Provider with respect to such Liquidity Facility on the
Regular Distribution Date next following the date of such investment in
accordance with clause (iv), (v) or (vi) of Section 3.6(f), the Business
Day immediately preceding such Regular Distribution Date, or (B) in the
case of a portion of the Relevant Amount equal to the Relevant Amount minus
the amount described in clause (A) above, the Business Day immediately
preceding the scheduled Interest Payment Date with respect to such
Liquidity Facility next following the date of such investment); provided,
however, that following the making of a Downgrade Drawing or a
Non-Extension Drawing under any Liquidity Facility, the Subordination Agent
shall invest and reinvest such amounts in Eligible Investments at the
direction of the Liquidity Provider funding such Drawing; provided further,
however, that upon the occurrence and during the continuation of a
Triggering Event, the Subordination Agent shall invest and reinvest such
amounts in accordance with the written instructions of the Controlling
Party. Unless otherwise expressly provided in this Agreement (including,
without limitation, with respect to Investment Earnings on amounts on
deposit in the Cash Collateral Accounts, Section 3.6(f) hereof), any
Investment Earnings shall be deposited in the Collection Account when
received by the Subordination Agent and shall be applied by the
Subordination Agent in the same manner as the other amounts on deposit in
the Collection Account are to be applied and any losses shall be charged
against the principal amount invested, in each case net of the
Subordination Agent's reasonable fees and expenses in making such
investments. The Subordination Agent shall not be liable for any loss
resulting from any investment, reinvestment or liquidation required to be
made under this Agreement other than by reason of its willful misconduct or
gross negligence. Eligible Investments and any other investment required to
be made hereunder shall be held to their maturities except that any such
investment may be sold (without regard to its maturity) by the
Subordination Agent without instructions whenever such sale is necessary to
make a distribution required under this Agreement. Uninvested funds held
hereunder shall not earn or accrue interest.
(c) The Subordination Agent shall possess all right, title
and interest in all funds on deposit from time to time in the Trust
Accounts and in all proceeds thereof (including all income thereon, except
as otherwise expressly provided herein with respect to Investment
Earnings). The Trust Accounts shall be held in trust by the Subordination
Agent under the sole dominion and control of the Subordination Agent for
the benefit of the Trustees, the Certificateholders and the Liquidity
Providers, as the case may be. If, at any time, any of the Trust Accounts
ceases to be an Eligible Deposit Account, the Subordination Agent shall
within 10 Business Days (or such longer period, not to exceed 30 calendar
days, to which each Rating Agency may consent) establish a new Collection
Account, Special Payments Account or Cash Collateral Account, as the case
may be, as an Eligible Deposit Account and shall transfer any cash and/or
any investments to such new Collection Account, Special Payments Account or
Cash Collateral Account, as the case may be. So long as State Street is an
Eligible Institution, the Trust Accounts shall be maintained with it as
Eligible Deposit Accounts.
SECTION 2.3. Deposits to the Collection Account and Special
Payments Account. (a) The Subordination Agent shall, upon receipt thereof,
deposit in the Collection Account all Scheduled Payments received by it.
(b) The Subordination Agent shall, on each date when one or
more Special Payments are made to the Subordination Agent as holder of the
Equipment Notes, deposit in the Special Payments Account the aggregate
amount of such Special Payments.
SECTION 2.4. Distributions of Special Payments. (a) Notice
of Special Payment. Except as provided in Section 2.4(e) below, upon
receipt by the Subordination Agent, as registered holder of the Equipment
Notes, of any notice of a Special Payment (or, in the absence of any such
notice, upon receipt by the Subordination Agent of a Special Payment), the
Subordination Agent shall promptly give notice thereof to each Trustee and
the Liquidity Providers. The Subordination Agent shall promptly calculate
the amount of the redemption or purchase of Equipment Notes or the amount
of any Overdue Scheduled Payment, as the case may be, comprising such
Special Payment under the applicable Indenture or Indentures and shall
promptly send to each Trustee a Written Notice of such amount and the
amount allocable to each Trust. Such Written Notice shall also set the
distribution date for such Special Payment (a "Special Distribution Date"),
which shall be the Business Day which immediately follows the later to
occur of (x) the 15th day after the date of such Written Notice or (y) the
date the Subordination Agent has received or expects to receive such
Special Payment. Amounts on deposit in the Special Payments Account shall
be distributed in accordance with Sections 2.4(b) and 2.4(c) hereof, as
applicable.
(b) Redemptions and Purchases of Equipment Notes. (i) So
long as no Triggering Event shall have occurred (whether or not
continuing), the Subordination Agent shall make distributions pursuant to
this Section 2.4(b) of amounts on deposit in the Special Payments Account
on account of the redemption, purchase (including, without limitation, a
purchase resulting from a sale of the Equipment Notes permitted by Article
IV hereof) or prepayment of all of the Equipment Notes issued pursuant to
an Indenture on the Special Distribution Date for such Special Payment in
the following order of priority:
first, such amount as shall be required to pay (A) all
accrued and unpaid Liquidity Expenses then in arrears plus
(B) the product of (x) the aggregate amount of all accrued
and unpaid Liquidity Expenses not in arrears to such Special
Distribution Date multiplied by (y) a fraction, the
numerator of which is the aggregate outstanding principal
amount of Equipment Notes being redeemed, purchased or
prepaid on such Special Distribution Date and the
denominator of which is the aggregate outstanding principal
amount of all Equipment Notes (the "Section 2.4(b)
Fraction"), shall be distributed to the Liquidity Providers
pro rata on the basis of the amount of Liquidity Expenses
owed to each Liquidity Provider;
second, such amount as shall be required to pay (A) all
accrued and unpaid interest (including interest accrued and
unpaid on any Interest Drawing or any Applied Provider
Advance (as defined in any Liquidity Facility)) then in
arrears on all Liquidity Obligations plus (B) the product of
(x) the aggregate amount of all accrued and unpaid interest
on all Liquidity Obligations not in arrears to such Special
Distribution Date (at the rate provided in the applicable
Liquidity Facility) multiplied by (y) the Section 2.4(b)
Fraction, shall be distributed to the Liquidity Providers
pro rata on the basis of the amount of such Liquidity
Obligations owed to each Liquidity Provider;
third, such amount as shall be required (A) if any Cash
Collateral Account had been previously funded as provided in
Section 3.6(f), to fund such Cash Collateral Account up to
its Required Amount shall be deposited in such Cash
Collateral Account, (B) if any Liquidity Facility shall
become a Downgraded Facility or a Non-Extended Facility at a
time when unreimbursed Interest Drawings under such
Liquidity Facility have reduced the Available Amount
thereunder to zero, to deposit into the related Cash
Collateral Account an amount equal to such Cash Collateral
Account's Required Amount shall be deposited in such Cash
Collateral Account, and (C) if, with respect to any
particular Liquidity Facility, neither subclause (A) nor
subclause (B) of this clause "third" are applicable, to pay
or reimburse the Liquidity Provider in respect of such
Liquidity Facility in an amount equal to the amount of any
unreimbursed Interest Drawings under such Liquidity Facility
shall be distributed to such Liquidity Provider, pro rata on
the basis of the amounts of all such deficiencies and/or
unreimbursed Interest Drawings in respect of each Liquidity
Provider;
fourth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to
either subclause (A) or (B) of clause "third" above, then
the Liquidity Provider with respect to such Liquidity
Facility shall be paid the excess of (x) the aggregate
outstanding amount of unreimbursed Advances (whether or not
then due) under such Liquidity Facility over (y) the
Required Amount for the relevant Class, pro rata on the
basis of such amounts in respect of each Liquidity Provider;
fifth, such amount as shall be required to pay in full
Expected Distributions to the holders of Class A
Certificates on such Special Distribution Date shall be
distributed to the Class A Trustee;
sixth, such amount as shall be required to pay in full
Expected Distributions to the holders of Class B
Certificates on such Special Distribution Date shall be
distributed to the Class B Trustee;
seventh, such amount as shall be required to pay in full
Expected Distributions to the holders of Class C
Certificates on such Special Distribution Date shall be
distributed to the Class C Trustee; and
eighth, the balance, if any, of such Special Payment shall
be transferred to the Collection Account for distribution in
accordance with Section 3.2 hereof.
For the purposes of this Section 2.4(b), clause (x) of the definition of
"Expected Distributions" shall be deemed to read as follows: "(x) accrued,
due and unpaid interest on such Certificates together with (without
duplication) accrued and unpaid interest on a portion of such Certificates
equal to the outstanding principal amount of the Equipment Notes held in
such Trust and being redeemed, purchased or prepaid (immediately prior to
such redemption, purchase or prepayment) in each case excluding interest,
if any, payable with respect to the Deposits related to such Trust".
(ii) Upon the occurrence of a Triggering Event (whether or
not continuing), the Subordination Agent shall make distributions pursuant
to this Section 2.4(b) of amounts on deposit in the Special Payments
Account on account of the redemption or purchase of all of the Equipment
Notes issued pursuant to an Indenture on the Special Distribution Date for
such Special Payment in accordance with Section 3.3 hereof.
(c) Other Special Payments. Except as provided in clause (e)
below, any amounts on deposit in the Special Payments Account other than in
respect of amounts to be distributed pursuant to Section 2.4(b) shall be
distributed on the Special Distribution Date therefor in accordance with
Article III hereof.
(d) Investment of Amounts in Special Payments Account. Any
amounts on deposit in the Special Payments Account prior to the
distribution thereof pursuant to Section 2.4(b) or (c) shall be invested in
accordance with Section 2.2(b). Investment Earnings on such investments
shall be distributed in accordance with Section 2.4(b) or (c), as the case
may be.
(e) Certain Payments. The Subordination Agent will
distribute promptly upon receipt thereof (i) any indemnity payment received
by it from the Owner Participant, the Owner Trustee or US Airways in
respect of any Trustee, any Liquidity Provider, any Paying Agent, any
Depositary or any Escrow Agent (collectively, the "Payees") and (ii) any
compensation (including, without limitation, any fees payable to any
Liquidity Provider under Section 2.03 of any Liquidity Facility) received
by it from the Owner Participant, the Owner Trustee or US Airways under any
Operative Agreement in respect of any Payee, directly to the Payee entitled
thereto.
SECTION 2.5. Designated Representatives. (a) With the
delivery of this Agreement, the Subordination Agent shall furnish to each
Liquidity Provider and each Trustee, and from time to time thereafter may
furnish to each Liquidity Provider and each Trustee, at the Subordination
Agent's discretion, or upon any Liquidity Provider's or Trustee's request
(which request shall not be made more than one time in any 12-month
period), a certificate (a "Subordination Agent Incumbency Certificate") of
a Responsible Officer of the Subordination Agent certifying as to the
incumbency and specimen signatures of the officers of the Subordination
Agent and the attorney-in-fact and agents of the Subordination Agent (the
"Subordination Agent Representatives") authorized to give Written Notices
on behalf of the Subordination Agent hereunder. Until each Liquidity
Provider and Trustee receives a subsequent Subordination Agent Incumbency
Certificate, it shall be entitled to rely on the last Subordination Agent
Incumbency Certificate delivered to it hereunder.
(b) With the delivery of this Agreement, each Trustee shall
furnish to the Subordination Agent, and from time to time thereafter may
furnish to the Subordination Agent, at such Trustee's discretion, or upon
the Subordination Agent's request (which request shall not be made more
than one time in any 12-month period), a certificate (a "Trustee Incumbency
Certificate") of a Responsible Officer of such Trustee certifying as to the
incumbency and specimen signatures of the officers of such Trustee and the
attorney-in-fact and agents of such Trustee (the "Trustee Representatives")
authorized to give Written Notices on behalf of such Trustee hereunder.
Until the Subordination Agent receives a subsequent Trustee Incumbency
Certificate, it shall be entitled to rely on the last Trustee Incumbency
Certificate delivered to it hereunder.
(c) With the delivery of this Agreement, each Liquidity
Provider shall furnish to the Subordination Agent, and from time to time
thereafter may furnish to the Subordination Agent, at such Liquidity
Provider's discretion, or upon the Subordination Agent's request (which
request shall not be made more than one time in any 12-month period), a
certificate (an "LP Incumbency Certificate") of any Responsible Officer of
such Liquidity Provider certifying as to the incumbency and specimen
signatures of any officer, attorney-in-fact, agent or other designated
representative of such Liquidity Provider (the "LP Representatives" and,
together with the Subordination Agent Representatives and the Trustee
Representatives, the "Designated Representatives") authorized to give
Written Notices on behalf of such Liquidity Provider hereunder. Until the
Subordination Agent receives a subsequent LP Incumbency Certificate, it
shall be entitled to rely on the last LP Incumbency Certificate delivered
to it hereunder.
SECTION 2.6. Controlling Party. (a) The Trustees and the
Liquidity Providers hereby agree that, with respect to any Indenture at any
given time, the Loan Trustee thereunder will be directed (i) in taking, or
refraining from taking, any action under such Indenture or with respect to
the Equipment Notes issued thereunder, so long as no Indenture Default has
occurred and is continuing thereunder, by the holders of at least a
majority of the outstanding principal amount of such Equipment Notes
(provided that, for so long as the Subordination Agent is the registered
holder of the Equipment Notes, the Subordination Agent shall act with
respect to this clause (i) in accordance with the directions of the
Trustees (in the case of each such Trustee, with respect to the Equipment
Notes issued under such Indenture and held as Trust Property of such Trust)
constituting, in the aggregate, directions with respect to such principal
amount of Equipment Notes), and (ii) after the occurrence and during the
continuance of an Indenture Default thereunder (which, in the case of an
Indenture pertaining to a Leased Aircraft, has not been cured by the
applicable Owner Trustee or the applicable Owner Participant, if
applicable, pursuant to Section 4.03 of such Indenture), in taking, or
refraining from taking, any action under such Indenture or with respect to
such Equipment Notes, including exercising remedies thereunder (including
Accelerating the Equipment Notes issued thereunder or foreclosing the Lien
on the Aircraft securing such Equipment Notes), by the Controlling Party.
(b) The Person who shall be the "Controlling Party shall be:
(w) the Class A Trustee; (x) upon payment of Final Distributions to the
holders of Class A Certificates, the Class B Trustee; (y) upon payment of
Final Distributions to the holders of Class B Certificates, the Class C
Trustee. For purposes of giving effect to the foregoing, the Trustees
(other than the Controlling Party) irrevocably agree (and the
Certificateholders (other than the Certificateholders represented by the
Controlling Party) shall be deemed to agree by virtue of their purchase of
Certificates) that the Subordination Agent, as record holder of the
Equipment Notes, shall exercise its voting rights in respect of the
Equipment Notes as directed by the Controlling Party and any vote so
exercised shall be binding upon the Trustees and all Certificateholders.
The Subordination Agent shall give written notice to all of
the other parties to this Agreement promptly upon a change in the identity
of the Controlling Party. Each of the parties hereto agrees that it shall
not exercise any of the rights of the Controlling Party at such time as it
is not the Controlling Party hereunder; provided, however, that nothing
herein contained shall prevent or prohibit any Non-Controlling Party from
exercising such rights as shall be specifically granted to such
Non-Controlling Party hereunder and under the other Operative Agreements.
(c) Notwithstanding the foregoing, at any time after 18
months from the earlier to occur of (i) the date on which the entire
Available Amount under any Liquidity Facility shall have been drawn (for
any reason other than a Downgrade Drawing or a Non-Extension Drawing) and
remain unreimbursed, (ii) the date on which the entire amount of any
Downgrade Drawing or Non-Extension Drawing shall have become and remain
"Applied Downgrade Advances" or "Applied Non-Extension Advances", as the
case may be, under and as defined in such Liquidity Facility and (iii) the
date on which all Equipment Notes shall have been Accelerated (provided
that with respect to the period prior to the Delivery Period Expiry Date,
such Equipment Notes have an aggregate outstanding principal balance in
excess of $300,000,000), the Liquidity Provider with the highest
outstanding amount of Liquidity Obligations owed to it shall have the right
to elect, by Written Notice to the Subordination Agent and each of the
Trustees, to become the Controlling Party hereunder with respect to any
Indenture at any time from and including the last day of such 18-month
period.
(d) The exercise of remedies by the Controlling Party under
this Agreement shall be expressly limited by Section 4.1(a)(ii) hereof.
(e) The Controlling Party shall not be entitled to require
or obligate any Non- Controlling Party to provide funds necessary to
exercise any right or remedy hereunder.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
AMOUNTS RECEIVED
SECTION 3.1. Written Notice of Distribution. (a) No later
than 3:00 P.M. (New York City time) on the Business Day immediately
preceding each Regular Distribution Date (or Special Distribution Date for
purposes of Section 2.4(b) hereof, as the case may be), each of the
following Persons shall deliver to the Subordination Agent a Written Notice
setting forth the following information as at the close of business on such
Business Day:
(i) With respect to the Class A Certificates, the Class A
Trustee shall separately set forth the amounts to be paid in
accordance with clause "fifth" of Section 3.2 or 2.4(b), as the
case may be, hereof;
(ii) With respect to the Class B Certificates, the Class B
Trustee shall separately set forth the amounts to be paid in
accordance with clause "sixth" of Section 3.2 or 2.4(b), as the
case may be, hereof;
(iii) With respect to the Class C Certificates, the Class C
Trustee shall separately set forth the amounts to be paid in
accordance with clause "seventh" of Section 3.2 or 2.4(b), as the
case may be, hereof;
(iv) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be
paid in accordance with clauses "first", "second", "third" and
"fourth" of Section 3.2 or 2.4(b), as the case may be, hereof; and
(v) Each Trustee shall set forth the amounts to be paid in
accordance with clause "eighth" of Section 3.2 hereof.
The notices required under this Section 3.1(a) may be in the form of a
schedule or similar document provided to the Subordination Agent by the
parties referenced therein or by any one of them, which schedule or similar
document may state that, unless there has been a prepayment of the
Certificates, such schedule or similar document is to remain in effect
until any substitute notice or amendment shall be given to the
Subordination Agent by the party providing such notice.
(b) Following the occurrence of a Triggering Event, the
Subordination Agent shall request the following information from the
following Persons, and each of the following Persons shall, upon the request
of the Subordination Agent, deliver a Written Notice to the Subordination
Agent setting forth for such Person the following information:
(i) With respect to the Class A Certificates, the Class A
Trustee shall separately set forth the amounts to be paid in
accordance with clauses "first" (to reimburse payments made by the
Class A Certificateholders pursuant to subclause (iii) of clause
"first" of Section 3.3 hereof) and "seventh" of Section 3.3 hereof;
(ii) With respect to the Class B Certificates, the Class B
Trustee shall separately set forth the amounts to be paid in
accordance with clauses "first" (to reimburse payments made by the
Class B Certificateholders pursuant to subclause (iii) of clause
"first" of Section 3.3 hereof) and "eighth" of Section 3.3 hereof;
(iii) With respect to the Class C Certificates, the Class C
Trustee shall separately set forth the amounts to be paid in
accordance with clauses "first" (to reimburse payments made by the
Class C Certificateholders, pursuant to subclause (iii) of clause
"first" of Section 3.3 hereof) and clause "ninth" of Section 3.3
hereof ;
(iv) With respect to each Liquidity Facility, the Liquidity
Provider thereunder shall separately set forth the amounts to be
paid to it in accordance with subclause (iii) of clause "first" of
Section 3.3 hereof and clauses "second", "third", "fourth" and
"fifth" of Section 3.3 hereof; and
(v) Each Trustee shall set forth the amounts to be paid in
accordance with clause "sixth" of Section 3.3 hereof.
(c) At such time as a Trustee or a Liquidity Provider shall
have received all amounts owing to it (and, in the case of a Trustee, the
Certificateholders for which it is acting) pursuant to Section 2.4, 3.2 or
3.3 hereof, as applicable, and, in the case of a Liquidity Provider, its
commitment under the related Liquidity Facility shall have terminated or
expired, such Person shall, by a Written Notice, so inform the
Subordination Agent and each other party to this Agreement.
(d) As provided in Section 6.5 hereof, the Subordination
Agent shall be fully protected in relying on any of the information set
forth in a Written Notice provided by any Trustee or any Liquidity Provider
pursuant to paragraphs (a) through (c) above and shall have no independent
obligation to verify, calculate or recalculate any amount set forth in any
Written Notice delivered in accordance with such paragraphs.
(e) Any Written Notice delivered by a Trustee or a Liquidity
Provider, as applicable, pursuant to Section 3.1(a), 3.1(b) or 3.1(c)
hereof, if made prior to 10:00 A.M. (New York City time) on any Business
Day shall be effective on the date delivered (or if delivered later on a
Business Day or if delivered on a day which is not a Business Day shall be
effective as of the next Business Day). Subject to the terms of this
Agreement, the Subordination Agent shall as promptly as practicable comply
with any such instructions; provided, however, that any transfer of funds
pursuant to any instruction received after 10:00 A.M. (New York City time)
on any Business Day may be made on the next succeeding Business Day.
(f) In the event the Subordination Agent shall not receive
from any Person any information set forth in paragraph (a) or (b) above
which is required to enable the Subordination Agent to make a distribution
to such Person pursuant to Section 3.2 or 3.3 hereof, the Subordination
Agent shall request such information and, failing to receive any such
information, the Subordination Agent shall not make such distribution(s) to
such Person. In such event, the Subordination Agent shall make
distributions pursuant to clauses "first" through "ninth" of Section 3.2
and clauses "first" through "ninth" of Section 3.3 to the extent it shall
have sufficient information to enable it to make such distributions, and
shall continue to hold any funds remaining, after making such
distributions, until the Subordination Agent shall receive all necessary
information to enable it to distribute any funds so withheld.
(g) On such dates (but not more frequently than monthly) as
any Liquidity Provider or any Trustee shall request, but in any event
automatically at the end of each calendar quarter, the Subordination Agent
shall send to such party a written statement reflecting all amounts on
deposit with the Subordination Agent pursuant to Section 3.1(f) hereof.
SECTION 3.2. Distribution of Amounts on Deposit in the
Collection Account. Except as otherwise provided in Sections 2.4, 3.1(f),
3.3, 3.4 and 3.6(b), amounts on deposit in the Collection Account (or, in
the case of any amount described in Section 2.4(c), on deposit in the
Special Payments Account) shall be promptly distributed on each Regular
Distribution Date (or, in the case of any amount described in Section
2.4(c), on the Special Distribution Date thereof) in the following order of
priority and in accordance with the information provided to the
Subordination Agent pursuant to Section 3.1(a) hereof:
first, such amount as shall be required to pay all accrued
and unpaid Liquidity Expenses owed to each Liquidity Provider shall
be distributed to the Liquidity Providers pro rata on the basis of
the amount of Liquidity Expenses owed to each Liquidity
Provider;
second, such amount as shall be required to pay in full the
aggregate amount of interest accrued on all Liquidity Obligations
(at the rate, or in the amount, provided in the applicable
Liquidity Facility) and unpaid shall be distributed to the
Liquidity Providers pro rata on the basis of the amount of such
Liquidity Obligations owed to each Liquidity Provider;
third, such amount as shall be required (A) if any Cash
Collateral Account had been previously funded as provided in
Section 3.6(f), to fund such Cash Collateral Account up to its
Required Amount shall be deposited in such Cash Collateral Account,
(B) if any Liquidity Facility shall become a Downgraded Facility or
a Non-Extended Facility at a time when unreimbursed Interest
Drawings under such Liquidity Facility have reduced the Available
Amount thereunder to zero, to deposit into the related Cash
Collateral Account an amount equal to such Cash Collateral
Account's Required Amount shall be deposited in such Cash
Collateral Account, and (C) if, with respect to any particular
Liquidity Facility, neither subclause (A) nor subclause (B) of this
clause "third" is applicable, to pay or reimburse the Liquidity
Provider in respect of such Liquidity Facility in an amount equal
to the amount of all Liquidity Obligations then due under such
Liquidity Facility (other than amounts payable pursuant to clause
"first" or "second" of this Section 3.2) shall be distributed to
such Liquidity Provider, pro rata on the basis of the amounts of
all such deficiencies and/or unreimbursed Liquidity Obligations in
respect of each Liquidity Provider;
fourth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to either
subclause (A) or (B) of clause "third" above, then the Liquidity
Provider with respect to such Liquidity Facility shall be paid the
excess of (x) the aggregate outstanding amount of unreimbursed
Advances (whether or not then due) under such Liquidity Facility
over (y) the Required Amount for the relevant Class, pro rata on
the basis of such amounts in respect of each Liquidity Provider;
fifth, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class A Certificates
on such Distribution Date shall be distributed to the Class A
Trustee;
sixth, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class B Certificates
on such Distribution Date shall be distributed to the Class B
Trustee;
seventh, such amount as shall be required to pay in full
Expected Distributions to the holders of the Class C Certificates
on such Distribution Date shall be distributed to the Class C
Trustee;
eighth, such amount as shall be required to pay in full the
aggregate unpaid amount of fees and expenses payable as of such
Distribution Date to the Subordination Agent and each Trustee
pursuant to the terms of this Agreement and the Trust Agreements,
as the case may be, shall be distributed to the Subordination Agent
and such Trustee; and
ninth, the balance, if any, of any such amount remaining
thereafter shall be held in the Collection Account for later
distribution in accordance with this Article III.
SECTION 3.3. Distribution of Amounts on Deposit Following a
Triggering Event. (a) Except as otherwise provided in Sections 3.1(f) and
3.6(b) hereof, upon the occurrence of a Triggering Event and at all times
thereafter, all funds in the Collection Account or the Special Payments
Account shall be promptly distributed by the Subordination Agent in the
following order of priority:
first, such amount as shall be required to reimburse (i)
the Subordination Agent for any out-of-pocket costs and expenses
actually incurred by it (to the extent not previously reimbursed)
in the protection of, or the realization of the value of, the
Equipment Notes or any Trust Indenture Estate, shall be applied by
the Subordination Agent in reimbursement of such costs and
expenses, (ii) each Trustee for any amounts of the nature described
in clause (i) above actually incurred by it under the applicable
Trust Agreement (to the extent not previously reimbursed), shall be
distributed to such Trustee, and (iii) any Liquidity Provider or
Certificateholder for payments, if any, made by it to the
Subordination Agent or any Trustee in respect of amounts described
in clause (i) above, shall be distributed to such Liquidity
Provider or to the applicable Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all
amounts described in clauses (i) through (iii) above;
second, such amount remaining as shall be required to pay
all accrued and unpaid Liquidity Expenses shall be distributed to
each Liquidity Provider pro rata on the basis of the amount of
Liquidity Expenses owed to each Liquidity Provider;
third, such amount remaining as shall be required to pay
accrued and unpaid interest on the Liquidity Obligations as
provided in the Liquidity Facilities shall be distributed to each
Liquidity Provider pro rata on the basis of the amount of such
accrued and unpaid interest owed to each Liquidity Provider;
fourth, such amount remaining as shall be required (A) if
any Cash Collateral Account had been previously funded as provided
in Section 3.6(f), unless (i) a Performing Note Deficiency exists
and a Liquidity Event of Default shall have occurred and be
continuing with respect to the relevant Liquidity Facility or (ii)
a Final Drawing shall have occurred with respect to such Liquidity
Facility, to fund such Cash Collateral Account up to its Required
Amount (less the amount of any repayments of Interest Drawings
under such Liquidity Facility while subclause (A)(i) above is
applicable) shall be deposited in such Cash Collateral Account, (B)
if any Liquidity Facility shall become a Downgraded Facility or a
Non-Extended Facility at a time when unreimbursed Interest Drawings
under such Liquidity Facility have reduced the Available Amount
thereunder to zero, unless (i) a Performing Note Deficiency exists
and a Liquidity Event of Default shall have occurred and be
continuing with respect to the relevant Liquidity Facility or (ii)
a Final Drawing shall have occurred with respect to such Liquidity
Facility, to deposit into the related Cash Collateral Account an
amount equal to such Cash Collateral Account's Required Amount
(less the amount of any repayments of Interest Drawings under such
Liquidity Facility while subclause (B)(i) above is applicable)
shall be deposited in such Cash Collateral Account, and (C) if,
with respect to any particular Liquidity Facility, neither
subclause (A) nor subclause (B) of this clause "fourth" are
applicable, to pay in full the outstanding amount of all Liquidity
Obligations then due under such Liquidity Facility (other than
amounts payable pursuant to clause "second" or "third" of this
Section 3.3) shall be distributed to such Liquidity Provider, pro
rata on the basis of the amounts of all such deficiencies and/or
unreimbursed Liquidity Obligations in respect of each Liquidity
Provider;
fifth, if, with respect to any particular Liquidity
Facility, any amounts are to be distributed pursuant to either
subclause (A) or (B) of clause "fourth" above, then the Liquidity
Provider with respect to such Liquidity Facility shall be paid the
excess of (x) the aggregate outstanding amount of unreimbursed
Advances (whether or not then due) under such Liquidity Facility
over (y) the Required Amount for the relevant Class (less the
amount of any repayments of Interest Drawings under such Liquidity
Facility while subclause (A)(i) or (B)(i), as the case may be, of
clause "fourth" above is applicable), pro rata on the basis of such
amounts in respect of each Liquidity Provider;
sixth, such amount as shall be required to reimburse or pay
(i) the Subordination Agent for any Tax (other than Taxes imposed
on compensation paid hereunder), expense, fee, charge or other loss
incurred by or any other amount payable to the Subordination Agent
in connection with the transactions contemplated hereby (to the
extent not previously reimbursed), shall be applied by the
Subordination Agent in reimbursement of such amount, (ii) each
Trustee for any Tax (other than Taxes imposed on compensation paid
under the applicable Trust Agreement), expense, fee, charge, loss
or any other amount payable to such Trustee under the applicable
Trust Agreements (to the extent not previously reimbursed), shall
be distributed to such Trustee, and (iii) each Certificateholder
for payments, if any, made by it pursuant to Section 5.2 hereof in
respect of amounts described in clause (i) above, shall be
distributed to the applicable Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all
amounts described in clauses (i) through (iii) above;
seventh, such amount remaining as shall be required to pay
in full Adjusted Expected Distributions on the Class A Certificates
shall be distributed to the Class A Trustee;
eighth, such amount remaining as shall be required to pay
in full Adjusted Expected Distributions on the Class B Certificates
shall be distributed to the Class B Trustee; and
ninth, such amount remaining as shall be required to pay in
full Adjusted Expected Distributions on the Class C Certificates
shall be distributed to the Class C Trustee.
SECTION 3.4. Other Payments. (a) Any payments received by
the Subordination Agent for which no provision as to the application
thereof is made in this Agreement shall be distributed by the Subordination
Agent (i) in the order of priority specified in Section 3.3 hereof and (ii)
to the extent received or realized at any time after the Final
Distributions for each Class of Certificates have been made, in the manner
provided in clause "first" of Section 3.3 hereof.
(b) On any Interest Payment Date under each Liquidity
Facility which is not a Distribution Date, the Subordination Agent shall
pay to the Liquidity Provider under such Liquidity Facility from, and to
the extent of, amounts on deposit in the Collection Account, an amount
equal to the amount of interest then due and payable to such Liquidity
Provider under such Liquidity Facility.
(c) Except as otherwise provided in Section 3.3 hereof, if
the Subordination Agent receives any Scheduled Payment after the Scheduled
Payment Date relating thereto, but prior to such payment becoming an
Overdue Scheduled Payment, then the Subordination Agent shall deposit such
Scheduled Payment in the Collection Account and promptly distribute such
Scheduled Payment in accordance with the priority of distributions set
forth in Section 3.2 hereof; provided that, for the purposes of this
Section 3.4(c) only, each reference in clause "eighth" of Section 3.2 to
"Distribution Date" shall be deemed to mean the actual date of payment of
such Scheduled Payment and each reference in clause "fifth", "sixth" or
"seventh" of Section 3.2 to "Distribution Date" shall be deemed to refer to
such Scheduled Payment Date.
SECTION 3.5. Payments to the Trustees and the Liquidity
Providers. Any amounts distributed hereunder to any Liquidity Provider
shall be paid to such Liquidity Provider by wire transfer of funds to the
address such Liquidity Provider shall provide to the Subordination Agent.
The Subordination Agent shall provide a Written Notice of any such transfer
to the applicable Liquidity Provider, as the case may be, at the time of
such transfer. Any amounts distributed hereunder by the Subordination Agent
to any Trustee which shall not be the same institution as the Subordination
Agent shall be paid to such Trustee by wire transfer funds at the address
such Trustee shall provide to the Subordination Agent.
SECTION 3.6. Liquidity Facilities. (a) Interest Drawings. If
on any Distribution Date, after giving effect to the subordination
provisions of this Agreement, the Subordination Agent shall not have
sufficient funds for the payment of any amounts due and owing in respect of
accrued interest on the Class A Certificates, the Class B Certificates or
the Class C Certificates (at the Stated Interest Rate for such Class of
Certificates), then, prior to 1:00 p.m.(New York City time) on such
Distribution Date, the Subordination Agent shall request a drawing (each
such drawing, an "Interest Drawing") under the Liquidity Facility with
respect to such Class of Certificates in an amount equal to the lesser of
(i) an amount sufficient to pay the amount of such accrued interest (at the
Stated Interest Rate for such Class of Certificates) and (ii) the Available
Amount under such Liquidity Facility, and shall pay such amount to the
Trustee with respect to such Class of Certificates in payment of such
accrued interest.
(b) Application of Interest Drawings. Notwithstanding
anything to the contrary contained in this Agreement, (i) all payments
received by the Subordination Agent in respect of an Interest Drawing under
the Class A Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class A Cash Collateral Account, and payable
in each case to the Class A Trustee on behalf of the Class A
Certificateholders, shall be promptly distributed to the Class A Trustee,
(ii) all payments received by the Subordination Agent in respect of an
Interest Drawing under the Class B Liquidity Facility and all amounts
withdrawn by the Subordination Agent from the Class B Cash Collateral
Account, and payable in each case to the Class B Trustee on behalf of the
Class B Certificateholders, shall be promptly distributed to the Class B
Trustee and (iii) all payments received by the Subordination Agent in
respect of an Interest Drawing under the Class C Liquidity Facility and all
amounts withdrawn by the Subordination Agent from the Class C Cash
Collateral Account, and payable in each case to the Class C Trustee on
behalf of the Class C Certificateholders, shall be promptly distributed to
the Class C Trustee.
(c) Downgrade Drawings. If at any time the short-term
unsecured debt rating of any Liquidity Provider issued by either Rating
Agency is lower than the applicable Threshold Rating, within 10 days after
receiving notice of such downgrading (but not later than the expiration
date of the Liquidity Facility issued by the downgraded Liquidity Provider
(the "Downgraded Facility")), such Liquidity Provider or US Airways may
arrange for a Replacement Liquidity Provider to issue and deliver a
Replacement Liquidity Facility to the Subordination Agent. If a Downgraded
Facility has not been replaced in accordance with the terms of this
paragraph, the Subordination Agent shall, on such 10th day (or if such 10th
day is not a Business Day, on the next succeeding Business Day) (or, if
earlier, the expiration date of such Downgraded Facility), request a
drawing in accordance with and to the extent permitted by such Downgraded
Facility (such drawing, a "Downgrade Drawing") of all available and undrawn
amounts thereunder. Amounts drawn pursuant to a Downgrade Drawing shall be
maintained and invested as provided in Section 3.6(f) hereof. The
applicable Liquidity Provider may also arrange for a Replacement Liquidity
Provider to issue and deliver a Replacement Liquidity Facility at any time
after such Downgrade Drawing so long as such Downgrade Drawing has not been
reimbursed in full to such Liquidity Provider.
(d) Non-Extension Drawings. If any Liquidity Facility with
respect to any Class of Certificates is scheduled to expire on a date (the
"Stated Expiration Date") prior to the date that is 15 days after the Final
Legal Distribution Date for such Class of Certificates, then, no earlier
than the 60th day and no later than the 40th day prior to the then Stated
Expiration Date, the Subordination Agent shall request that such Liquidity
Provider extend the Stated Expiration Date until the earlier of (i) the
date which is 15 days after such Final Legal Distribution Date and (ii) the
date that is the day immediately preceding the 364th day occurring after
the Stated Expiration Date (unless the obligations of such Liquidity
Provider thereunder are earlier terminated in accordance with such
Liquidity Facility). The Liquidity Provider may advise the Borrower, no
earlier than 40 days and no later than 25 days prior to such Stated
Expiration Date, that it agrees to so extend the Stated Expiration Date,
but, in any event, without the necessity of any action on the part of the
Liquidity Provider, such Stated Expiration Date shall automatically be so
extended, unless the Liquidity Provider advises the Subordination Agent on
or before the 25th day prior to such Stated Expiration Date that such
Stated Expiration Date shall not be so extended in which event and (if such
Liquidity Facility shall not have been replaced in accordance with Section
3.6(e)), the Subordination Agent shall, on such 25th day (or as soon as
possible thereafter), in accordance with the terms of the expiring
Liquidity Facility (a "Non- Extended Facility"), request a drawing under
such expiring Liquidity Facility (such drawing, a "Non-Extension Drawing")
of all available and undrawn amounts thereunder. Amounts drawn pursuant to
a Non-Extension Drawing shall be maintained and invested in accordance with
Section 3.6(f) hereof.
(e) Issuance of Replacement Liquidity Facility. (i) At any
time, US Airways may, at its option, with cause or without cause, arrange
for a Replacement Liquidity Facility to replace any Liquidity Facility for
any Class of Certificates (including any Replacement Liquidity Facility
provided pursuant to Section 3.6(e)(ii) hereof); provided, however, that if
the initial Liquidity Provider is replaced for one or more Liquidity
Facilities it must be replaced for all remaining Liquidity Facilities and
the initial Liquidity Provider for any Liquidity Facility shall not be
replaced by US Airways as a Liquidity Provider with respect to such
Liquidity Facility prior to the fifth anniversary of the Closing Date
unless (A) there shall have become due to such initial Liquidity Provider,
or such initial Liquidity Provider shall have demanded, amounts pursuant to
Section 3.01, 3.02 or 3.03 of any applicable Liquidity Facility and the
replacement of such initial Liquidity Provider would reduce or eliminate
the obligation to pay such amounts or US Airways determines in good faith
that there is a substantial likelihood that such initial Liquidity Provider
will have the right to claim any such amounts (unless such initial
Liquidity Provider waives, in writing, any right it may have to claim such
amounts), which determination shall be set forth in a certificate delivered
by US Airways to such initial Liquidity Provider setting forth the basis
for such determination and accompanied by an opinion of outside counsel
selected by US Airways and reasonably acceptable to such initial Liquidity
Provider verifying the legal conclusions, if any, of such certificate
relating to such basis, provided that, in the case of any likely claim for
such amounts based upon any proposed, or proposed change in, law, rule,
regulation, interpretation, directive, requirement, request or
administrative practice, such opinion may assume the adoption or
promulgation of such proposed matter, (B) it shall become unlawful or
impossible for such initial Liquidity Provider (or its Facility Office) to
maintain or fund its LIBOR Advances as described in Section 3.10 of any
Liquidity Facility, (C) the short-term unsecured debt rating of such
initial Liquidity Provider is downgraded by Standard & Poor's from A-1+ to
A-1 and there is a resulting downgrade in the rating by any Rating Agency
of any Class of Certificates, (D) any Liquidity Facility of such initial
Liquidity Provider shall become a Downgraded Facility or a Non-Extended
Facility or a Downgrade Drawing or a Non-Extension Drawing shall have
occurred under any Liquidity Facility of such initial Liquidity Provider or
(E) such initial Liquidity Provider shall have breached any of its payment
(including, without limitation, funding) obligations under any Liquidity
Facility in respect of which it is the Liquidity Provider. If such
Replacement Liquidity Facility is provided at any time after a Downgrade
Drawing or Non-Extension Drawing has been made, all funds on deposit in the
relevant Cash Collateral Account will be returned to the Liquidity Provider
being replaced.
(ii) If any Liquidity Provider shall determine not to
extend any of its Liquidity Facilities in accordance with Section
3.6(d), then such Liquidity Provider may, at its option, arrange
for a Replacement Liquidity Facility to replace such Liquidity
Facility during the period no earlier than 40 days and no later
than 25 days prior to the then effective Stated Expiration Date of
such Liquidity Facility.
(iii) No Replacement Liquidity Facility arranged by US
Airways or a Liquidity Provider in accordance with clause (i) or
(ii) above or pursuant to Section 3.6(c), respectively, shall
become effective and no such Replacement Liquidity Facility shall
be deemed a "Liquidity Facility" under the Operative Agreements (in
each case other than insofar as necessary to permit the repayment
of amounts owed to the replaced Liquidity Provider), unless and
until (A) each of the conditions referred to in this clause (iii)
and clause (iv) below shall have been satisfied, (B) if such
Replacement Liquidity Facility shall materially adversely affect
the rights, remedies, interests or obligations of the Class A
Certificateholders, the Class B Certificateholders or the Class C
Certificateholders under any of the Operative Agreements, the
applicable Trustee shall have consented, in writing, to the
execution and issuance of such Replacement Liquidity Facility and
(C) in the case of a Replacement Liquidity Facility arranged by a
Liquidity Provider under Section 3.6(e)(ii) or pursuant to Section
3.6(c), such Replacement Liquidity Facility is reasonably
acceptable to US Airways.
(iv) In connection with the issuance of each Replacement
Liquidity Facility, the Subordination Agent shall (x) prior to the
issuance of such Replacement Liquidity Facility, obtain written
confirmation from each Rating Agency that such Replacement
Liquidity Facility will not cause a reduction of any rating then in
effect for any Class of Certificates by such Rating Agency (without
regard to any downgrading of any rating of any Liquidity Provider
being replaced pursuant to Section 3.6(c) hereof or 3.6(e)(i),(ii)
or (iii) hereof), (y) pay all Liquidity Obligations then owing to
the replaced Liquidity Provider (which payment shall be made first
from available funds in the applicable Cash Collateral Account as
described in clause (vii) of Section 3.6(f) hereof, and thereafter
from any other available source, including, without limitation, a
drawing under the Replacement Liquidity Facility) and (z) cause the
issuer of the Replacement Liquidity Facility to deliver the
Replacement Liquidity Facility to the Subordination Agent, together
with a legal opinion opining that such Replacement Liquidity
Facility is an enforceable obligation of such Replacement Liquidity
Provider.
(v) Upon satisfaction of the conditions set forth in
clauses (iii) and (iv) of this Section 3.6(e) with respect to a
Replacement Liquidity Facility, (w) the replaced Liquidity Facility
shall terminate, (x) the Subordination Agent shall, if and to the
extent so requested by US Airways or the Liquidity Provider being
replaced, execute and deliver any certificate or other instrument
required in order to terminate the replaced Liquidity Facility,
shall surrender the replaced Liquidity Facility to the Liquidity
Provider being replaced and shall execute and deliver the
Replacement Liquidity Facility and any associated Fee Letter, (y)
each of the parties hereto shall enter into any amendments to this
Agreement necessary to give effect to (1) the replacement of the
applicable Liquidity Provider with the applicable Replacement
Liquidity Provider and (2) the replacement of the applicable
Liquidity Facility with the applicable Replacement Liquidity
Facility and (z) the applicable Replacement Liquidity Provider
shall be deemed to be a Liquidity Provider with the rights and
obligations of a Liquidity Provider hereunder and under the other
Operative Agreements and such Replacement Liquidity Facility shall
be deemed to be a Liquidity Facility hereunder and under the other
Operative Agreements.
(f) Cash Collateral Accounts; Withdrawals; Investments. In
the event the Subordination Agent shall draw all available amounts under
the Class A Liquidity Facility, the Class B Liquidity Facility or the Class
C Liquidity Facility pursuant to Section 3.6(c), 3.6(d) or 3.6(i) hereof,
or in the event amounts are to be deposited in a Cash Collateral Account
pursuant to subclause (B) of clause "third" of Section 2.4(b), subclause
(B) of clause "third" of Section 3.2 or subclause (B) of clause "fourth" of
Section 3.3, amounts so drawn or to be deposited, as the case may be, shall
be deposited by the Subordination Agent in the Class A Cash Collateral
Account, the Class B Cash Collateral Account or the Class C Collateral
Account, respectively. All amounts on deposit in each Cash Collateral
Account shall be invested and reinvested in Eligible Investments in
accordance with Section 2.2(b) hereof.
On each Interest Payment Date (or, in the case of any Special Distribution
Date occurring prior to the occurrence of a Triggering Event on such
Special Distribution Date), Investment Earnings on amounts on deposit in
each Cash Collateral Account (or, in the case of any Special Distribution
Date occurring prior to the occurrence of a Triggering Event, a fraction of
such Investment Earnings equal to the Section 2.4(b) Fraction) shall be
deposited in the Collection Account (or, in the case of any Special
Distribution Date occurring prior to the occurrence of a Triggering Event,
the Special Payments Account) and applied on such Interest Payment Date (or
Special Distribution Date, as the case may be) in accordance with Section
2.4, 3.2, 3.3 or 3.4 (as applicable). The Subordination Agent shall deliver
a written statement to US Airways and the Liquidity Provider one day prior
to each Interest Payment Date and Special Distribution Date setting forth
the aggregate amount of Investment Earnings held in the Cash Collateral
Accounts as of such date. In addition, from and after the date funds are so
deposited, the Subordination Agent shall make withdrawals from such account
as follows:
(i) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay
accrued and unpaid interest due and owing on the Class A
Certificates (at the Stated Interest Rate for the Class A
Certificates) from any other source, withdraw from the Class A Cash
Collateral Account, and pay to the Class A Trustee, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid
interest (at the Stated Interest Rate for the Class A Certificates)
on such Class A Certificates and (y) the amount on deposit in the
Class A Cash Collateral Account;
(ii) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay
accrued and unpaid interest due and owing on the Class B
Certificates (at the Stated Interest Rate for the Class B
Certificates) from any other source, withdraw from the Class B Cash
Collateral Account, and pay to the Class B Trustee, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid
interest (at the Stated Interest Rate for the Class B Certificates)
on such Class B Certificates and (y) the amount on deposit in the
Class B Cash Collateral Account;
(iii) on each Distribution Date, the Subordination Agent
shall, to the extent it shall not have received funds to pay
accrued and unpaid interest due and owing on the Class C
Certificates (at the Stated Interest Rate for the Class C
Certificates) from any other source, withdraw from the Class C Cash
Collateral Account, and pay to the Class C Trustee, an amount equal
to the lesser of (x) an amount necessary to pay accrued and unpaid
interest (at the Stated Interest Rate for the Class C Certificates)
on such Class C Certificates and (y) the amount on deposit in the
Class C Cash Collateral Account;
(iv) on each date on which the Pool Balance of the Class A
Trust shall have been reduced by payments made to the Class A
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement
for such Class, the Subordination Agent shall withdraw from the
Class A Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on
such date (including any such reduction resulting from a prior
withdrawal of amounts on deposit in the Class A Cash Collateral
Account on such date) and any transfer of Investment Earnings from
such Cash Collateral Account to the Collection Account or the
Special Payments Account on such date, an amount equal to the sum
of the Required Amount (with respect to the Class A Liquidity
Facility) plus Investment Earnings on deposit in such Cash
Collateral Account will be on deposit in the Class A Cash
Collateral Account and shall first, pay such withdrawn amount to
the Class A Liquidity Provider until the Liquidity Obligations
(with respect to the Class A Certificates) owing to such Liquidity
Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;
(v) on each date on which the Pool Balance of the Class B
Trust shall have been reduced by payments made to the Class B
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement
for such Class, the Subordination Agent shall withdraw from the
Class B Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on
such date (including any such reduction resulting from a prior
withdrawal of amounts on deposit in the Class B Cash Collateral
Account on such date) and any transfer of Investment Earnings from
such Cash Collateral Account to the Collection Account or the
Special Payments Account on such date, an amount equal to the sum
of the Required Amount (with respect to the Class B Liquidity
Facility) plus Investment Earnings on deposit in such Cash
Collateral Account will be on deposit in the Class B Cash
Collateral Account and shall first, pay such withdrawn amount to
the Class B Liquidity Provider until the Liquidity Obligations
(with respect to the Class B Certificates) owing to such Liquidity
Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;
(vi) on each date on which the Pool Balance of the Class C
Trust shall have been reduced by payments made to the Class C
Certificateholders pursuant to Section 2.4, 3.2 or 3.3 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement
for such Class, the Subordination Agent shall withdraw from the
Class C Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on
such date (including any such reduction resulting from a prior
withdrawal of amounts on deposit in the Class C Cash Collateral
Account on such date) and any transfer of Investment Earnings from
such Cash Collateral Account to the Collection Account or the
Special Payments Account on such date, an amount equal to the sum
of the Required Amount (with respect to the Class C Liquidity
Facility) plus Investment Earnings on deposit in such Cash
Collateral Account will be on deposit in the Class C Cash
Collateral Account and shall first, pay such withdrawn amount to
the Class C Liquidity Provider until the Liquidity Obligations
(with respect to the Class C Certificates) owing to such Liquidity
Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;
(vii) if a Replacement Liquidity Facility for any Class of
Certificates shall be delivered to the Subordination Agent
following the date on which funds have been deposited into the Cash
Collateral Account for such Class of Certificates, the
Subordination Agent shall withdraw all amounts on deposit in such
Cash Collateral Account and shall pay such amounts to the replaced
Liquidity Provider until all Liquidity Obligations owed to such
Person shall have been paid in full, and shall deposit any
remaining amount in the Collection Account; and
(viii)following the payment of Final Distributions with
respect to any Class of Certificates, on the date on which the
Subordination Agent shall have been notified by the Liquidity
Provider for such Class of Certificates that the Liquidity
Obligations owed to such Liquidity Provider have been paid in full,
the Subordination Agent shall withdraw all amounts on deposit in
the Cash Collateral Account in respect of such Class of
Certificates and shall deposit such amount in the Collection
Account.
(g) Reinstatement. With respect to any Interest Drawing
under the Liquidity Facility for any Trust, upon the reimbursement of the
applicable Liquidity Provider for all or any part of the amount of such
Interest Drawing, together with any accrued interest thereon, the Available
Amount of such Liquidity Facility shall be reinstated by an amount equal to
the amount of such Interest Drawing so reimbursed to the applicable
Liquidity Provider but not to exceed the Stated Amount for such Liquidity
Facility; provided, however, that such Liquidity Facility shall not be so
reinstated in part or in full at any time if (x) both a Performing Note
Deficiency exists and a Liquidity Event of Default shall have occurred and
be continuing with respect to the relevant Liquidity Facility or (y) a
Final Drawing shall have occurred with respect to such Liquidity Facility.
In the event that, with respect to any particular Liquidity Facility (i)
funds are withdrawn from any Cash Collateral Account pursuant to clause
(i), (ii), (iii) or (iv) of Section 3.6(f) hereof or (ii) such Liquidity
Facility shall become a Downgraded Facility or a Non-Extended Facility at a
time when unreimbursed Interest Drawings under such Liquidity Facility have
reduced the Available Amount thereunder to zero, then funds received by the
Subordination Agent at any time other than (x) any time when a Liquidity
Event of Default shall have occurred and be continuing with respect to such
Liquidity Facility and a Performing Note Deficiency exists or (y) any time
after a Final Drawing shall have occurred with respect to such Liquidity
Facility shall be deposited in such Cash Collateral Account as and to the
extent provided in clause "third" of Section 2.4(b), clause "third" of
Section 3.2 or clause "fourth" of Section 3.3, as applicable, and applied
in accordance with Section 3.6(f) hereof.
(h) Reimbursement. The amount of each drawing under the
Liquidity Facilities shall be due and payable, together with interest
thereon, on the dates and at the rates, respectively, provided in the
Liquidity Facilities.
(i) Final Drawing. Upon receipt from a Liquidity Provider of
a Termination Notice with respect to any Liquidity Facility, the
Subordination Agent shall, not later than the date specified in such
Termination Notice, in accordance with the terms of such Liquidity
Facility, request a drawing under such Liquidity Facility of all available
and undrawn amounts thereunder (a "Final Drawing"). Amounts drawn pursuant
to a Final Drawing shall be maintained and invested in accordance with
Section 3.6(f) hereof.
(j) Reduction of Stated Amount. Promptly following each date
on which the Required Amount of the Liquidity Facility for a Class of
Certificates is reduced as a result of a reduction in the Pool Balance with
respect to such Certificates, the Subordination Agent shall, if any such
Liquidity Facility provides for reductions of the Stated Amount of such
Liquidity Facility and if such reductions are not automatic, request such
Liquidity Provider for such Class of Certificates to reduce such Stated
Amount to an amount equal to the Required Amount with respect to such
Liquidity Facility (as calculated by the Subordination Agent after giving
effect to such payment). Each such request shall be made in accordance with
the provisions of the applicable Liquidity Facility.
(k) Relation to Subordination Provisions. Interest Drawings
under the Liquidity Facilities and withdrawals from the Cash Collateral
Accounts, in each case, in respect of interest on the Certificates of any
Class, will be distributed to the Trustee for such Class of Certificates,
notwithstanding Sections 3.2, 3.3 and 3.6(h) hereof.
(l) Assignment of Liquidity Facility. The Subordination
Agent agrees not to consent to the assignment by any Liquidity Provider of
any of its rights or obligations under any Liquidity Facility or any
interest therein, unless (i) US Airways shall have consented to such
assignment and (ii) each Rating Agency shall have provided a Ratings
Confirmation in respect of such assignment.
ARTICLE IV
EXERCISE OF REMEDIES
SECTION 4.1. Directions from the Controlling Party. (a) (i)
Following the occurrence and during the continuation of an Indenture
Default under any Indenture, the Controlling Party shall direct the
Subordination Agent, which in turn shall direct the Loan Trustee under such
Indenture, in the exercise of remedies available to the holders of the
Equipment Notes issued pursuant to such Indenture, including, without
limitation, the ability to vote all such Equipment Notes in favor of
Accelerating such Equipment Notes in accordance with the provisions of such
Indenture. Subject to the Owner Trustees' and the Owner Participants'
rights, if any, set forth in the Indentures with respect to Leased Aircraft
to purchase the Equipment Notes and the provisions of the next paragraph,
if the Equipment Notes issued pursuant to any Indenture have been
Accelerated following an Indenture Default with respect thereto, the
Controlling Party may sell, assign, contract to sell or otherwise dispose
of and deliver all (but not less than all) of such Equipment Notes to any
Person at public or private sale, at any location at the option of the
Controlling Party, all upon such terms and conditions as it may reasonably
deem advisable in accordance with applicable law.
(ii) Subject to the Owner Trustees' and the Owner
Participants' rights, if any, set forth in the Indentures with
respect to Leased Aircraft to purchase the Equipment Notes, and
notwithstanding the foregoing, so long as any Certificates remain
Outstanding, during the period ending on the date which is nine
months after the earlier of (x) the Acceleration of the Equipment
Notes issued pursuant to any Indenture or (y) the occurrence of a
US Airways Bankruptcy Event, without the consent of each Trustee,
(A) no Aircraft subject to the Lien of such Indenture or such
Equipment Notes may be sold if the net proceeds from such sale
would be less than the Minimum Sale Price for such Aircraft or such
Equipment Notes, and (B) with respect to any Leased Aircraft, the
amount and payment dates of rentals payable by US Airways under the
Lease for such Aircraft may not be adjusted, if, as a result of
such adjustment, the discounted present value of all such rentals
would be less than 75% of the discounted present value of the
rentals payable by US Airways under such Lease before giving effect
to such adjustment, in each case, using the weighted average
interest rate of the Equipment Notes issued pursuant to such
Indenture as the discount rate.
(iii) At the request of the Controlling Party, the
Subordination Agent may from time to time during the continuance of
an Indenture Default (and before the occurrence of a Triggering
Event) commission LTV Appraisals with respect to the Aircraft
subject to such Indenture.
(iv) After a Triggering Event occurs and any Equipment Note
becomes a NonPerforming Equipment Note, the Subordination Agent
shall obtain Appraisals with respect to all of the Aircraft (the
"LTV Appraisals") as soon as practicable and additional LTV
Appraisals on or prior to each anniversary of the date of such
initial LTV Appraisals; provided that if the Controlling Party
reasonably objects to the appraised value of the Aircraft shown in
such LTV Appraisals, the Controlling Party shall have the right to
obtain or cause to be obtained substitute LTV Appraisals (including
any LTV Appraisals based upon physical inspection of the Aircraft).
(b) The Controlling Party shall take such actions as it may
reasonably deem most effectual to complete the sale or other disposition of
such Aircraft or Equipment Notes. In addition, in lieu of any sale,
assignment, contract to sell or other disposition, the Controlling Party
may maintain possession of such Equipment Notes and continue to apply
monies received in respect of such Equipment Notes in accordance with
Article III hereof. In addition, in lieu of such sale, assignment, contract
to sell or other disposition, or in lieu of such maintenance of possession,
the Controlling Party may, subject to the terms and conditions of the
related Indenture, instruct the Loan Trustee under such Indenture to
foreclose on the Lien on the related Aircraft.
SECTION 4.2. Remedies Cumulative. Each and every right,
power and remedy given to the Trustees, the Liquidity Providers, the
Controlling Party or the Subordination Agent specifically or otherwise in
this Agreement shall be cumulative and shall be in addition to every other
right, power and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute, and each and every right, power
and remedy whether specifically herein given or otherwise existing may,
subject always to the terms and conditions hereof, be exercised from time
to time and as often and in such order as may be deemed expedient by any
Trustee, any Liquidity Provider, the Controlling Party or the Subordination
Agent, as appropriate, and the exercise or the beginning of the exercise of
any power or remedy shall not be construed to be a waiver of the right to
exercise at the same time or thereafter any other right, power or remedy.
No delay or omission by any Trustee, any Liquidity Provider, the
Controlling Party or the Subordination Agent in the exercise of any right,
remedy or power or in the pursuit of any remedy shall impair any such
right, power or remedy or be construed to be a waiver of any default or to
be an acquiescence therein.
SECTION 4.3. Discontinuance of Proceedings. In case any
party to this Agreement (including the Controlling Party in such capacity)
shall have instituted any Proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, entry or otherwise, and such
Proceeding shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Person instituting such
Proceeding, then and in every such case each such party shall, subject to
any determination in such Proceeding, be restored to its former position
and rights hereunder, and all rights, remedies and powers of such party
shall continue as if no such Proceeding had been instituted.
SECTION 4.4. Right of Certificateholders to Receive Payments
Not to Be Impaired. Anything in this Agreement to the contrary
notwithstanding but subject to each Trust Agreement, the right of any
Certificateholder or any Liquidity Provider, respectively, to receive
payments hereunder (including without limitation pursuant to Section 2.4,
3.2 or 3.3 hereof) when due, or to institute suit for the enforcement of
any such payment on or after the applicable Distribution Date, shall not be
impaired or affected without the consent of such Certificateholder or such
Liquidity Provider, respectively.
SECTION 4.5. Undertaking for Costs. In any Proceeding for
the enforcement of any right or remedy under this Agreement or in any
Proceeding against any Controlling Party or the Subordination Agent for any
action taken or omitted by it as Controlling Party or Subordination Agent,
as the case may be, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. The provisions of this Section do not
apply to a suit instituted by the Subordination Agent, a Liquidity Provider
or a Trustee or a suit by Certificateholders holding more than 10% of the
original principal amount of any Class of Certificates.
ARTICLE V
DUTIES OF THE SUBORDINATION AGENT;
AGREEMENTS OF TRUSTEES, ETC.
SECTION 5.1. Notice of Indenture Default or Triggering
Event. (a) In the event the Subordination Agent shall have actual knowledge
of the occurrence of an Indenture Default or a Triggering Event, as
promptly as practicable, and in any event within 10 days after obtaining
knowledge thereof, the Subordination Agent shall transmit by mail or
courier to the Rating Agencies, the Liquidity Providers and the Trustees
notice of such Indenture Default or Triggering Event, unless such Indenture
Default or Triggering Event shall have been cured or waived. For all
purposes of this Agreement, in the absence of actual knowledge on the part
of a Responsible Officer, the Subordination Agent shall not be deemed to
have knowledge of any Indenture Default or Triggering Event unless notified
in writing by one or more Trustees, one or more Liquidity Providers or one
or more Certificateholders.
(b) Other Notices. The Subordination Agent will furnish to
each Liquidity Provider and Trustee, promptly upon receipt thereof,
duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and other instruments furnished to the
Subordination Agent as registered holder of the Equipment Notes or
otherwise in its capacity as Subordination Agent to the extent the same
shall not have been otherwise directly distributed to such Liquidity
Provider or Trustee, as applicable, pursuant to the express provision of
any other Operative Agreement.
SECTION 5.2. Indemnification. The Subordination Agent shall
not be required to take any action or refrain from taking any action under
Section 5.1 (other than the first sentence thereof) or Article IV hereof
unless the Subordination Agent shall have been indemnified (to the extent
and in the manner reasonably satisfactory to the Subordination Agent)
against any liability, cost or expense (including counsel fees and
expenses) which may be incurred in connection therewith. The Subordination
Agent shall not be under any obligation to take any action under this
Agreement and nothing contained in this Agreement shall require the
Subordination Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in
the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it. The
Subordination Agent shall not be required to take any action under Section
5.1 (other than the first sentence thereof) or Article IV hereof, nor shall
any other provision of this Agreement be deemed to impose a duty on the
Subordination Agent to take any action, if the Subordination Agent shall
have been advised by counsel that such action is contrary to the terms
hereof or is otherwise contrary to law.
SECTION 5.3. No Duties Except as Specified in Intercreditor
Agreement. The Subordination Agent shall not have any duty or obligation to
take or refrain from taking any action under, or in connection with, this
Agreement, except as expressly provided by the terms of this Agreement; and
no implied duties or obligations shall be read into this Agreement against
the Subordination Agent. The Subordination Agent agrees that it will, in
its individual capacity and at its own cost and expense (but without any
right of indemnity in respect of any such cost or expense under Section 7.1
hereof) promptly take such action as may be necessary to duly discharge all
Liens on any of the Trust Accounts or any monies deposited therein which
result from claims against it in its individual capacity not related to its
activities hereunder or any other Operative Agreement.
SECTION 5.4. Notice from the Liquidity Providers and
Trustees. If any Liquidity Provider or Trustee has notice of an Indenture
Default or a Triggering Event, such Person shall promptly give notice
thereof to all other Liquidity Providers and Trustees and to the
Subordination Agent, provided, however, that no such Person shall have any
liability hereunder as a result of its failure to deliver any such notice.
ARTICLE VI
THE SUBORDINATION AGENT
SECTION 6.1. Authorization; Acceptance of Trusts and Duties.
Each of the Class A Trustee, the Class B Trustee and the Class C Trustee
hereby designates and appoints the Subordination Agent as the agent and
trustee of such Trustee under the applicable Liquidity Facility and
authorizes the Subordination Agent to enter into the applicable Liquidity
Facility as agent and trustee for such Trustee. Each of the Liquidity
Providers and the Trustees hereby designates and appoints the Subordination
Agent as the Subordination Agent under this Agreement. State Street hereby
accepts the duties hereby created and applicable to it as the Subordination
Agent and agrees to perform the same but only upon the terms of this
Agreement and agrees to receive and disburse all monies received by it in
accordance with the terms hereof. The Subordination Agent shall not be
answerable or accountable under any circumstances, except (a) for its own
willful misconduct or gross negligence (or ordinary negligence in the
handling of funds), (b) as provided in Section 2.2 hereof and (c) for
liabilities that may result from the material inaccuracy of any
representation or warranty of the Subordination Agent made in its
individual capacity in any Operative Agreement. The Subordination Agent
shall not be liable for any error of judgment made in good faith by a
Responsible Officer of the Subordination Agent, unless it is proved that
the Subordination Agent was negligent in ascertaining the pertinent facts.
SECTION 6.2. Absence of Duties. The Subordination Agent
shall have no duty to see to any recording or filing of this Agreement or
any other document, or to see to the maintenance of any such recording or
filing.
SECTION 6.3. No Representations or Warranties as to
Documents. The Subordination Agent in its individual capacity does not make
nor shall be deemed to have made any representation or warranty as to the
validity, legality or enforceability of this Agreement or any other
Operative Agreement or as to the correctness of any statement contained in
any thereof, except for the representations and warranties of the
Subordination Agent, made in its individual capacity, under any Operative
Agreement to which it is a party. The Certificateholders, the Trustees and
the Liquidity Providers make no representation or warranty hereunder
whatsoever.
SECTION 6.4. No Segregation of Monies; No Interest. Any
monies paid to or retained by the Subordination Agent pursuant to any
provision hereof and not then required to be distributed to any Trustee or
any Liquidity Provider as provided in Articles II and III hereof or
deposited into one or more Trust Accounts need not be segregated in any
manner except to the extent required by such Articles II and III and by
law, and the Subordination Agent shall not (except as otherwise provided in
Section 2.2 hereof) be liable for any interest thereon; provided, however,
that any payments received or applied hereunder by the Subordination Agent
shall be accounted for by the Subordination Agent so that any portion
thereof paid or applied pursuant hereto shall be identifiable as to the
source thereof.
SECTION 6.5. Reliance; Agents; Advice of Counsel. The
Subordination Agent shall not incur liability to anyone in acting upon any
signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper believed by
it to be genuine and believed by it to be signed by the proper party or
parties. As to the Pool Balance of any Trust as of any date, the
Subordination Agent may for all purposes hereof rely on a certificate
signed by any Responsible Officer of the applicable Trustee, and such
certificate shall constitute full protection to the Subordination Agent for
any action taken or omitted to be taken by it in good faith in reliance
thereon. As to any fact or matter relating to the Liquidity Providers or
the Trustees the manner of ascertainment of which is not specifically
described herein, the Subordination Agent may for all purposes hereof rely
on a certificate, signed by any Responsible Officer of the applicable
Liquidity Provider or Trustee, as the case may be, as to such fact or
matter, and such certificate shall constitute full protection to the
Subordination Agent for any action taken or omitted to be taken by it in
good faith in reliance thereon. The Subordination Agent shall assume, and
shall be fully protected in assuming, that each of the Liquidity Providers
and each of the Trustees are authorized to enter into this Agreement and to
take all action to be taken by them pursuant to the provisions hereof, and
shall not inquire into the authorization of each of the Liquidity Providers
and each of the Trustees with respect thereto. In the administration of the
trusts hereunder, the Subordination Agent may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or
through agents or attorneys and may consult with counsel, accountants and
other skilled persons to be selected and retained by it, and the
Subordination Agent shall not be liable for the acts or omissions of any
agent appointed with due care or for anything done, suffered or omitted in
good faith by it in accordance with the advice or written opinion of any
such counsel, accountants or other skilled persons.
SECTION 6.6. Capacity in Which Acting. The Subordination
Agent acts hereunder solely as agent and trustee herein and not in its
individual capacity, except as otherwise expressly provided in the
Operative Agreements.
SECTION 6.7. Compensation. The Subordination Agent shall be
entitled to reasonable compensation, including expenses and disbursements,
for all services rendered hereunder and shall have a priority claim to the
extent set forth in Article III hereof on all monies collected hereunder
for the payment of such compensation, to the extent that such compensation
shall not be paid by others. The Subordination Agent agrees that it shall
have no right against any Trustee or Liquidity Provider for any fee as
compensation for its services as agent under this Agreement. The provisions
of this Section 6.7 shall survive the termination of this Agreement.
SECTION 6.8. May Become Certificateholder. The institution
acting as Subordination Agent hereunder may become a Certificateholder and
have all rights and benefits of a Certificateholder to the same extent as
if it were not the institution acting as the Subordination Agent.
SECTION 6.9. Subordination Agent Required; Eligibility.
There shall at all times be a Subordination Agent hereunder which shall be
a corporation organized and doing business under the laws of the United
States of America or of any State or the District of Columbia having a
combined capital and surplus of at least $100,000,000 (or the obligations
of which, whether now in existence or hereafter incurred, are fully and
unconditionally guaranteed by a corporation organized and doing business
under the laws of the United States of America, any State thereof or of the
District of Columbia and having a combined capital and surplus of at least
$100,000,000), if there is such an institution willing and able to perform
the duties of the Subordination Agent hereunder upon reasonable or
customary terms. Such corporation shall be a citizen of the United States
and shall be authorized under the laws of the United States or any State
thereof or of the District of Columbia to exercise corporate trust powers
and shall be subject to supervision or examination by federal, state or
District of Columbia authorities. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of any
of the aforesaid supervising or examining authorities, then, for the
purposes of this Section 6.9, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published.
In case at any time the Subordination Agent shall cease to
be eligible in accordance with the provisions of this Section, the
Subordination Agent shall resign immediately in the manner and with the
effect specified in Section 8.1.
SECTION 6.10. Money to Be Held in Trust. All Equipment
Notes, monies and other property deposited with or held by the
Subordination Agent pursuant to this Agreement shall be held in trust for
the benefit of the parties entitled to such Equipment Notes, monies and
other property. All such Equipment Notes, monies or other property shall be
held in the Trust Department of the institution acting as Subordination
Agent hereunder.
ARTICLE VII
INDEMNIFICATION OF SUBORDINATION AGENT
SECTION 7.1. Scope of Indemnification. The Subordination
Agent shall be indemnified hereunder to the extent and in the manner
described in Section 6(b) of the Participation Agreements with respect to
Owned Aircraft, Section (b) of the Participation Agreements with respect to
Leased Aircraft and Section 6 and Section 7 of the Note Purchase Agreement.
The indemnities contained in such Sections of such agreements shall survive
the termination of this Agreement.
ARTICLE VIII
SUCCESSOR SUBORDINATION AGENT
SECTION 8.1. Replacement of Subordination Agent; Appointment
of Successor. The Subordination Agent may resign at any time by so
notifying the Trustees and the Liquidity Providers. The Controlling Party
may remove the Subordination Agent for cause by so notifying the
Subordination Agent and may appoint a successor Subordination Agent. The
Controlling Party shall remove the Subordination Agent if:
(1) the Subordination Agent fails to comply with Section
6.9 hereof;
(2) the Subordination Agent is adjudged bankrupt or
insolvent;
(3) a receiver or other public officer takes charge of the
Subordination Agent or its property; or
(4) the Subordination Agent otherwise becomes incapable of
acting.
If the Subordination Agent resigns or is removed or if a
vacancy exists in the office of Subordination Agent for any reason (the
Subordination Agent in such event being referred to herein as the retiring
Subordination Agent), the Controlling Party shall promptly appoint a
successor Subordination Agent.
A successor Subordination Agent shall deliver (x) a written
acceptance of its appointment as Subordination Agent hereunder to the
retiring Subordination Agent and (y) a written assumption of its
obligations hereunder and under each Liquidity Facility to each party
hereto, upon which the resignation or removal of the retiring Subordination
Agent shall become effective, and the successor Subordination Agent shall
have all the rights, powers and duties of the Subordination Agent under
this Agreement. The successor Subordination Agent shall mail a notice of
its succession to the Liquidity Providers and the Trustees. The retiring
Subordination Agent shall promptly transfer its rights under each of the
Liquidity Facilities and all of the property held by it as Subordination
Agent to the successor Subordination Agent.
If a successor Subordination Agent does not take office
within 60 days after the retiring Subordination Agent resigns or is
removed, the retiring Subordination Agent or one or more of the Trustees
may petition any court of competent jurisdiction for the appointment of a
successor Subordination Agent.
If the Subordination Agent fails to comply with Section 6.9
hereof (to the extent applicable), one or more of the Trustees or one or
more of the Liquidity Providers may petition any court of competent
jurisdiction for the removal of the Subordination Agent and the
appointment of a successor Subordination Agent.
Notwithstanding the foregoing, no resignation or removal of
the Subordination Agent shall be effective unless and until a successor has
been appointed. No appointment of a successor Subordination Agent shall be
effective unless and until the Rating Agencies shall have
delivered a Ratings Confirmation.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS
SECTION 9.1. Amendments, Waivers, etc. (a) This Agreement
may not be supplemented, amended or modified without the consent of each
Trustee (acting, except in the case of any amendment pursuant to Section
3.6(e)(v)(y) hereof with respect to any Replacement Liquidity Facility or
any amendment contemplated by the last sentence of this Section 9.1(a),
with the consent of holders of Certificates of the related Class evidencing
interests in the related Trust aggregating not less than a majority in
interest in such Trust or as otherwise authorized pursuant to the relevant
Trust Agreement), the Subordination Agent and each Liquidity Provider;
provided, however, that this Agreement may be supplemented, amended or
modified without the consent of any Trustee if such supplement, amendment
or cures an ambiguity or inconsistency or does not materially adversely
affect such Trustee or the holders of the related Class of Certificates;
provided further, however, that, if such supplement, amendment or
modification (A) would (x) directly or indirectly modify or supersede, or
otherwise conflict with, Section 2.2(b), Section 3.6(e), Section
3.6(f)(other than the last sentence thereof), or the second sentence of
Section 10.6 or this Section 9.1 (collectively, the "US Airways
Provisions") or (y) otherwise adversely affect the interests of a potential
Replacement Liquidity Provider or of US Airways with respect to its ability
to replace any Liquidity Facility or with respect to its payment
obligations under any Operative Agreement or (B) is made pursuant to the
last sentence of this Section 9.1(a), then such supplement, amendment or
modification shall not be effective without the additional written consent
of US Airways. Notwithstanding the foregoing, without the consent of each
Certificateholder and each Liquidity Provider, no supplement, amendment or
modification of this Agreement may (i) reduce the percentage of the
interest in any Trust evidenced by the Certificates issued by such Trust
necessary to consent to modify or amend any provision of this Agreement or
to waive compliance therewith or (ii) except as provided in the last
sentence of this Section 9.1(a), modify Section 2.4, 3.2 or 3.3 hereof,
relating to the distribution of monies received by the Subordination Agent
hereunder from the Equipment Notes or pursuant to the Liquidity Facilities.
Nothing contained in this Section shall require the consent of a Trustee at
any time following the payment of Final Distributions with respect to the
related Class of Certificates. If the Replacement Liquidity Facility for
any Liquidity Facility in accordance with Section 3.6(e) hereof is to be
comprised of more than one instrument as contemplated by the definition of
the term "Replacement Liquidity Facility", then each of the parties hereto
agrees to amend this Agreement to incorporate appropriate mechanics for
multiple Liquidity Facilities for an individual Trust.
(b) In the event that the Subordination Agent, as the
registered holder of any Equipment Notes, receives a request for its
consent to any amendment, modification, consent or waiver under such
Equipment Notes, the Indenture pursuant to which such Equipment Notes were
issued, or the related Lease, Participation Agreement or other related
document, (i) if no Indenture Default shall have occurred and be continuing
with respect to such Indenture, the Subordination Agent shall request
directions with respect to each Series of such Equipment Notes from the
Trustee of the Trust which holds such Equipment Notes and shall vote or
consent in accordance with the directions of such Trustee and (ii) if any
Indenture Default (which, in the case of any Indenture pertaining to a
Leased Aircraft, has not been cured by the applicable Owner Trustee or the
applicable Owner Participant, if applicable, pursuant to Section 4.03 of
such Indenture) shall have occurred and be continuing with respect to such
Indenture, the Subordination Agent will exercise its voting rights as
directed by the Controlling Party, subject to Sections 4.1 and 4.4 hereof;
provided that no such amendment, modification or waiver shall, without the
consent of each Liquidity Provider, reduce the amount of rent, supplemental
rent or stipulated loss values payable by US Airways under any Lease or
reduce the amount of principal or interest payable by US Airways under any
Equipment Note issued under any Indenture in respect of an Owned Aircraft.
SECTION 9.2. Subordination Agent Protected. If, in the
reasonable opinion of the institution acting as the Subordination Agent
hereunder, any document required to be executed pursuant to the terms of
Section 9.1 affects any right, duty, immunity or indemnity with respect to
it under this Agreement or any Liquidity Facility, the Subordination Agent
may in its discretion decline to execute such document.
SECTION 9.3. Effect of Supplemental Agreements. Upon the
execution of any amendment, consent or supplement hereto pursuant to the
provisions hereof, this Agreement shall be and be deemed to be and shall be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this
Agreement of the parties hereto and beneficiaries hereof shall thereafter
be determined, exercised and enforced hereunder subject in all respects to
such modifications and amendments, and all the terms and conditions of any
such supplemental agreement shall be and be deemed to be and shall be part
of the terms and conditions of this Agreement for any and all purposes. In
executing or accepting any supplemental agreement permitted by this Article
IX, the Subordination Agent shall be entitled to receive, and shall be
fully protected in relying upon, an opinion of counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement.
SECTION 9.4. Notice to Rating Agencies. Promptly following
its receipt of each amendment, consent, modification, supplement or waiver
contemplated by this Article IX, the Subordination Agent shall send a copy
thereof to each Rating Agency.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Termination of Intercreditor Agreement.
Following payment of Final Distributions with respect to each Class of
Certificates and the payment in full of all Liquidity Obligations to the
Liquidity Providers and provided that there shall then be no other amounts
due to the Certificateholders, the Trustees, the Liquidity Providers and
the Subordination Agent hereunder or under the Trust Agreements, and that
the commitment of the Liquidity Providers under the Liquidity Facilities
shall have expired or been terminated, this Agreement and the trusts
created hereby shall terminate and this Agreement shall be of no further
force or effect. Except as aforesaid or otherwise provided, this Agreement
and the trusts created hereby shall continue in full force and effect in
accordance with the terms hereof.
SECTION 10.2. Intercreditor Agreement for Benefit of
Trustees, Liquidity Providers and Subordination Agent. Subject to the
second sentence of Section 10.6 and the provisions of Section 4.4, nothing
in this Agreement, whether express or implied, shall be construed to give
to any Person other than the Trustees, the Liquidity Providers and the
Subordination Agent any legal or equitable right, remedy or claim under or
in respect of this Agreement.
SECTION 10.3. Notices. Unless otherwise expressly specified
or permitted by the terms hereof, all notices, requests, demands,
authorizations, directions, consents, waivers or documents provided or
permitted by this Agreement to be made, given, furnished or filed shall be
in writing, mailed by certified mail, postage prepaid, or by confirmed
telecopy and
(i) if to the Subordination Agent, addressed to at its
office at:
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION
225 Asylum Street
Goodwin Square
Hartford , CT 06013
Attention: Corporate/Muni. Department
Telephone: (860) 244-1822
Telecopy: (860) 244-1889
with a copy to:
State Street Corp.
Corporate Trust Dept.
2 International Place, 4th Floor
Boston, MA 02110
Attention: Ruth A. Smith
Fax: (617) 664-5151
(ii) if to any Trustee, addressed to it at its office at:
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION 225 Asylum
Street Goodwin Square Hartford , CT 06013
Attention: Corporate/Muni. Trust Department
Telephone: (617) 664-5340
Telecopy: (617) 664-5151
with a copy to:
State Street Corp.
Corporate Trust Dept.
2 International Place, 4th Floor
Boston, MA 02110
Attention: Ruth A. Smith
Fax: (617) 664-5151
(iii) if to the Liquidity Provider, addressed to it at its
office at:
AIG MATCHED FUNDING CORP.
100 Nyala Farm
Westport, CT 06880
Attention: Chief Financial Officer
Telephone: (203) 222-4700
Telecopy: (203) 222-4780
with a copy to: the General Counsel at the same address
and fax number.
Whenever any notice in writing is required to be given by any Trustee or
Liquidity Provider or the Subordination Agent to any of the other of them,
such notice shall be deemed given and such requirement satisfied when such
notice is received. Any party hereto may change the address to which
notices to such party will be sent by giving notice of such change to the
other parties to this Agreement.
SECTION 10.4. Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 10.5. No Oral Modifications or Continuing Waivers.
No terms or provisions of this Agreement may be changed, waived, discharged
or terminated orally, but only by an instrument in writing signed by the
party or other Person against whom enforcement of the change, waiver,
discharge or termination is sought and any other party or other Person
whose consent is required pursuant to this Agreement and any waiver of the
terms hereof shall be effective only in the specific instance and for the
specific purpose given.
SECTION 10.6. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit
of, each of the parties hereto and the successors and assigns of each, all
as herein provided. In addition, the US Airways Provisions shall inure to
the benefit of US Airways and its successors and assigns, and (without
limitation of the foregoing) US Airways is hereby constituted, and agreed
to be, an express third party beneficiary of the US Airways Provisions.
SECTION 10.7. Headings. The headings of the various Articles
and Sections herein and in the table of contents hereto are for convenience
of reference only and shall not define or limit any of the terms or
provisions hereof.
SECTION 10.8. Counterpart Form. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when
so executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same agreement.
SECTION 10.9. Subordination. (a) As between the Liquidity
Providers, on the one hand, and the Trustees and the Certificateholders, on
the other hand, and as among the Trustees and the related
Certificateholders this Agreement shall be a subordination agreement for
purposes of Section 510 of the United States Bankruptcy Code, as amended
from time to time.
(b) Notwithstanding the provisions of this Agreement, if
prior to the payment in full to the Liquidity Providers of all Liquidity
Obligations then due and payable, any party hereto shall have received any
payment or distribution in respect of Equipment Notes or any other amount
under the Indentures or other Operative Agreements which, had the
subordination provisions of this Agreement been properly applied to such
payment, distribution or other amount, would not have been distributed to
such Person, then such payment, distribution or other amount shall be
received and held in trust by such Person and paid over or delivered to the
Subordination Agent for application as provided herein.
(c) If any Trustee, any Liquidity Provider or the
Subordination Agent receives any payment in respect of any obligations
owing hereunder (or, in the case of the Liquidity Providers, in respect of
the Liquidity Obligations), which is subsequently invalidated, declared
preferential, set aside and/or required to be repaid to a trustee, receiver
or other party, then, to the extent of such payment, such obligations (or,
in the case of the Liquidity Providers, such Liquidity Obligations)
intended to be satisfied shall be revived and continue in full force and
effect as if such payment had not been received.
(d) The Trustees (on behalf of themselves and the holders of
Certificates), the Liquidity Providers and the Subordination Agent confirm
that the payment priorities specified in Sections 2.4, 3.2 and 3.3 shall
apply in all circumstances, notwithstanding the fact that the obligations
owed to the Trustees and the holders of Certificates are secured by certain
assets and the Liquidity Obligations may not be so secured. The Trustees
expressly agree (on behalf of themselves and the holders of Certificates)
not to assert priority over the holders of Liquidity Obligations due to
their status as secured creditors in any bankruptcy, insolvency or other
legal proceeding.
(e) Each of the Trustees (on behalf of themselves and the
holders of Certificates), the Liquidity Providers and the Subordination
Agent may take any of the following actions without impairing its rights
under this Agreement:
(i) obtain a Lien on any property to secure any amounts
owing to it hereunder, including, in the case of the Liquidity
Providers, the Liquidity Obligations,
(ii) obtain the primary or secondary obligation of any
other obligor with respect to any amounts owing to it hereunder,
including, in the case of the Liquidity Providers, any of the
Liquidity Obligations,
(iii) renew, extend, increase, alter or exchange any
amounts owing to it hereunder, including, in the case of the
Liquidity Providers, any of the Liquidity Obligations, or release
or compromise any obligation of any obligor with respect thereto,
(iv) refrain from exercising any right or remedy, or delay
in exercising such right or remedy, which it may have, or
(v) take any other action which might discharge a
subordinated party or a surety under applicable law;
provided, however, that the taking of any such actions by any of the
Trustees, the Liquidity Providers or the Subordination Agent shall not
prejudice the rights or adversely affect the obligations of any other party
under this Agreement.
SECTION 10.10. Governing Law. THIS AGREEMENT SHALL IN ALL
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE.
SECTION 10.11. Submission to Jurisdiction; Waiver of Jury
Trial; Waiver of Immunity. (a) Each of the parties hereto hereby
irrevocably and unconditionally:
(i) submits for itself and its property in any legal action
or proceeding relating to this Agreement or any other Operative
Agreement, or for recognition and enforcement of any judgment in
respect hereof or thereof, to the nonexclusive general jurisdiction
of the courts of the State of New York, the courts of the United
States of America for the Southern District of New York, and the
appellate courts from any thereof;
(ii) consents that any such action or proceeding may be
brought in such courts, and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered
or certified mail (or any substantially similar form of mail),
postage prepaid, to each party hereto at its address set forth in
Section 10.3 hereof, or at such other address of which the other
parties shall have been notified pursuant thereto; and
(iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction.
(b) EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING
TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS BEING
ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. Each
of the parties warrants and represents that it has reviewed this waiver
with its legal counsel, and that it knowingly and voluntarily waives its
jury trial rights following consultation with such legal counsel. THIS
WAIVER IS IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
(c) Each Liquidity Provider hereby waives any immunity it
may have from the jurisdiction of the courts of the United States of
America or of any State and waives any immunity any of its properties
located in the United States of America may have from attachment or
execution upon a judgment entered by any such court under the United States
Foreign Sovereign Immunities Act of 1976 or any similar successor
legislation.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, as of the day and year first
above written.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Trustee for each of the Trusts
By /s/ Julie A. Balerna
_____________________________________
Name: Julie A. Balerna
Title: Assistant Vice-President
AIG MATCHED FUNDING CORP., as Class
A Liquidity Provider, Class B
Liquidity Provider and Class C
Liquidity Provider
By /s/ Colum Carr
_____________________________________
Name: Colum Carr
Title: Vice President
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its
individual capacity except as
expressly set forth herein but
solely as Subordination Agent
and trustee
By /s/ Julie A. Balerna
_____________________________________
Name: Julie A. Balerna
Title: Assistant Vice-President
Exhibit 4(a)(x)
[GRAPHIC OMITTED]
ESCROW AND PAYING AGENT AGREEMENT
(Class A)
Dated as of August 31, 1999
among
FIRST SECURITY BANK, NATIONAL ASSOCIATION
as Escrow Agent
CREDIT SUISSE FIRST BOSTON CORPORATION
DEUTSCHE BANK SECURITIES INC.
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
GOLDMAN, SACHS & CO.
and
SALOMON SMITH BARNEY INC.
as Underwriters
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Pass Through Trustee
for and on behalf of
US Airways Pass Through Trust 1999-1A
as Pass Through Trustee
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Paying Agent
TABLE OF CONTENTS
Page
SECTION 1. Escrow Agent................................................ 2
Section 1.1 Appointment of Escrow Agent......................... 2
Section 1.2 Instruction, Etc.................................... 3
Section 1.3 Initial Escrow Amount; Issuance of Escrow Receipts.. 3
Section 1.4 Payments to Receiptholders.......................... 4
Section 1.5 Mutilated, Destroyed, Lost or Stolen Escrow Receipt. 4
Section 1.6 Additional Escrow Amounts........................... 5
Section 1.7 Resignation or Removal of Escrow Agent.............. 5
Section 1.8 Persons Deemed Owners............................... 5
Section 1.9 Further Assurances.................................. 6
SECTION 2. Paying Agent................................................ 6
Section 2.1 Appointment of Paying Agent......................... 6
Section 2.2 Establishment of Paying Agent Account............... 6
Section 2.3 Payments from Paying Agent Account.................. 6
Section 2.4 Withholding Taxes................................... 7
Section 2.5 Resignation or Removal of Paying Agent.............. 8
Section 2.6 Notice of Final Withdrawal.......................... 8
SECTION 3. Payments.................................................... 8
SECTION 4. Other Actions............................................... 9
SECTION 5. Representations and Warranties of the Escrow Agent.......... 9
SECTION 6. Representations and Warranties of the Paying Agent.......... 10
SECTION 7. Indemnification............................................. 11
SECTION 8. Amendment, Etc.............................................. 11
SECTION 9. Notices..................................................... 12
SECTION 10. Transfer.................................................... 12
SECTION 11. Entire Agreement............................................ 13
SECTION 12. Governing Law............................................... 13
SECTION 13. WAIVER OF JURY TRIAL RIGHT.................................. 13
SECTION 14. Counterparts................................................ 13
EXHIBITS
Exhibit A Escrow Receipt
Exhibit B Withdrawal Certificate
This ESCROW AND PAYING AGENT AGREEMENT (Class A) dated as of
August 31, 1999 (as amended, modified or supplemented from time to time,
this "Agreement") among First Security Bank, National Association, a
national banking association, as Escrow Agent (in such capacity, together
with its successors in such capacity, the "Escrow Agent"); Credit Suisse
First Boston Corporation, Deutsche Bank Securities Inc., Donaldson, Lufkin
& Jenrette Securities Corporation, Goldman, Sachs & Co., and Salomon Smith
Barney Inc., as Underwriters of the Certificates referred to below (the
"Underwriters" and together with their respective transferees and assigns
as registered owners of the Certificates, the "Investors") under the
Underwriting Agreement referred to below; State Street Bank and Trust
Company of Connecticut, National Association, a national banking
association, not in its individual capacity except as otherwise expressly
provided herein, but solely as trustee (in such capacity, together with its
successors in such capacity, the "Pass Through Trustee") under the Pass
Through Trust Agreement referred to below; and State Street Bank and Trust
Company of Connecticut, National Association, a national banking
association, as paying agent hereunder (in such capacity, together with its
successors in such capacity, the "Paying Agent").
W I T N E S S E T H
WHEREAS, US Airways, Inc. ("US Airways") and the Pass
Through Trustee have entered into a Trust Supplement, dated as of the date
hereof (the "Trust Supplement"), to the Pass Through Trust Agreement, dated
as of July 30, 1999 (together, as amended, modified or supplemented from
time to time in accordance with the terms thereof, the "Pass Through Trust
Agreement") relating to US Airways Pass Through Trust 1999-1A (the "Pass
Through Trust") pursuant to which the US Airways Pass Through Trust, Series
1999-1A Certificates referred to therein (the "Certificates") are being
issued;
WHEREAS, US Airways and the Underwriters have entered into
an Underwriting Agreement dated as of August 24, 1999 (as amended, modified
or supplemented from time to time in accordance with the terms thereof, the
"Underwriting Agreement") pursuant to which the Pass Through Trustee will
issue and sell the Certificates to the Underwriters;
WHEREAS, US Airways, the Pass Through Trustee, certain other
pass through trustees and certain other persons concurrently herewith are
entering into the Note Purchase Agreement, dated as of the date hereof (the
"Note Purchase Agreement"), pursuant to which the Pass Through Trustee has
agreed to acquire from time to time on or prior to the Delivery Period
Termination Date (as defined in the Note Purchase Agreement) equipment
notes (the "Equipment Notes") issued to finance the acquisition of aircraft
by US Airways, as lessee or as owner, utilizing a portion of the proceeds
from the sale of the Certificates (the "Net Proceeds");
WHEREAS, the Underwriters and the Pass Through Trustee
intend that the Net Proceeds be held in escrow by the Escrow Agent on
behalf of the Investors, subject to withdrawal upon request by the Pass
Through Trustee and satisfaction of the conditions set forth in the Note
Purchase Agreement for the purpose of purchasing Equipment Notes, and that
pending such withdrawal the Net Proceeds be deposited on behalf of the
Escrow Agent with
ABN AMRO BANK N.V., acting through its Chicago branch, as Depositary (the
"Depositary") under the Deposit Agreement, dated as of the date hereof
between the Depositary and the Escrow Agent relating to the Pass Through
Trust (as amended, modified or supplemented from time to time in accordance
with the terms thereof, the "Deposit Agreement") pursuant to which, among
other things, the Depositary will pay interest for distribution to the
Investors and establish accounts from which the Escrow Agent shall make
withdrawals upon request of and proper certification by the Pass Through
Trustee;
WHEREAS, the Escrow Agent wishes to appoint the Paying Agent
to pay amounts required to be distributed to the Investors in accordance
with this Agreement; and
WHEREAS, capitalized terms used but not defined herein shall
have the respective meanings set forth or incorporated by reference in the
Pass Through Trust Agreement.
NOW, THEREFORE, in consideration of the obligations
contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. Escrow Agent.
Section 1.1 Appointment of Escrow Agent. Each of the
Underwriters, for and on behalf of each of the Investors, hereby
irrevocably appoints, authorizes and directs the Escrow Agent to act as
escrow agent and fiduciary hereunder and under the Deposit Agreement for
such specific purposes and with such powers as are specifically delegated
to the Escrow Agent by the terms of this Agreement, together with such
other powers as are reasonably incidental thereto. Any and all money
received and held by the Escrow Agent under this Agreement or the Deposit
Agreement shall be held in escrow by the Escrow Agent in accordance with
the terms of this Agreement. This Agreement is irrevocable and the
Investors' rights with respect to any monies received and held in escrow by
the Escrow Agent under this Agreement or the Deposit Agreement shall only
be as provided under the terms and conditions of this Agreement and the
Deposit Agreement. The Escrow Agent (which term as used in this sentence
shall include reference to its affiliates and its own and its affiliates'
officers, directors, employees and agents):
(1) shall have no duties or responsibilities except those
expressly set forth in this Agreement;
(2) shall not be responsible to the Pass Through Trustee or
the Investors for any recitals, statements, representations or warranties
of any person other then itself contained in this Agreement or the Deposit
Agreement or for the failure by the Pass Through Trustee, the Investors or
any other person or entity (other than the Escrow Agent) to perform any of
its obligations hereunder (whether or not the Escrow Agent shall have any
knowledge thereof); and
(3) shall not be responsible for any action taken or omitted
to be taken by it hereunder or provided for herein or in connection
herewith, except for its own willful misconduct or gross negligence (or
simple negligence in connection with the handling of funds).
Section 1.2 Instruction, Etc. The Underwriters, for and on
behalf of each of the Investors, hereby irrevocably instruct the Escrow
Agent, and the Escrow Agent agrees: (a) to enter into the Deposit
Agreement; (b) to appoint the Paying Agent as provided in this Agreement;
(c) upon receipt at any time and from time to time prior to the Termination
Date (as defined below) of a certificate substantially in the form of
Exhibit B hereto (a "Withdrawal Certificate") executed by the Pass Through
Trustee, together with an attached Notice of Purchase Withdrawal in
substantially the form of Exhibit A to the Deposit Agreement duly completed
by the Pass Through Trustee (the "Applicable Notice of Purchase Withdrawal"
and the withdrawal to which it relates, a "Purchase Withdrawal"),
immediately to execute the Applicable Notice of Purchase Withdrawal as
Escrow Agent and transmit it to the Depositary by facsimile transmission in
accordance with the Deposit Agreement; provided that, upon the request of
the Pass Through Trustee after such transmission, the Escrow Agent shall
cancel such Applicable Notice of Purchase Withdrawal; and (d) if there are
any undrawn Deposits (as defined in the Deposit Agreement) on the
"Termination Date", which shall mean the earlier of (i) July 20, 2000 and
(ii) the day on which the Escrow Agent receives notice from the Pass
Through Trustee that the Pass Through Trustee's obligation to purchase
Equipment Notes under the Note Purchase Agreement has terminated, to give
notice to the Depositary (with a copy to the Paying Agent) substantially in
the form of Exhibit B to the Deposit Agreement requesting a withdrawal of
all of the remaining Deposits, together with accrued and unpaid interest on
such Deposits to the date of withdrawal, on the 15th day after the date
that such notice of withdrawal is given to the Depositary (or, if not a
Business Day, on the next succeeding Business Day) (a "Final Withdrawal"),
provided that if the day scheduled for the Final Withdrawal in accordance
with the foregoing is within ten days before or after a Regular
Distribution Date, then the Escrow Agent shall request that such requested
Final Withdrawal be made on such Regular Distribution Date (the date of
such requested withdrawal, the "Final Withdrawal Date"). If for any reason
the Escrow Agent shall have failed to give the Final Withdrawal Notice to
the Depositary on or before July 21, 2000, and there are unwithdrawn
Deposits on such date, the Final Withdrawal Date shall be deemed to be
August 7, 2000.
Section 1.3 Initial Escrow Amount; Issuance of Escrow
Receipts. The Escrow Agent hereby directs the Underwriters to, and the
Underwriters hereby acknowledge that on the date hereof they shall,
irrevocably deliver to the Depositary on behalf of the Escrow Agent, an
amount in U.S. dollars ("Dollars") and immediately available funds equal to
$384,884,000 for deposit on behalf of the Escrow Agent with the Depositary
in accordance with Section 2.1 of the Deposit Agreement. The Underwriters
hereby instruct the Escrow Agent, upon the Depositary's receipt (on behalf
of the Escrow Agent) of such sum from the Underwriters, to confirm such
receipt by executing and delivering to the Pass Through Trustee an Escrow
Receipt in the form of Exhibit A hereto (an "Escrow Receipt"), (a) to be
affixed by the Pass Through Trustee to each Certificate and (b) to evidence
the same percentage interest (the "Escrow Interest") in the Account Amounts
(as defined below) as the Fractional Undivided Interest in the Pass Through
Trust evidenced by the Certificate to which it is to be affixed. The Escrow
Agent shall provide to the Pass Through Trustee for attachment to each
Certificate newly issued under and in accordance with the Pass Through
Trust Agreement an executed Escrow Receipt as the Pass Through Trustee may
from time to time request of the Escrow Agent. Each Escrow Receipt shall be
registered by the Escrow Agent in a register (the "Register") maintained by
the Escrow Agent in the same name and same manner as the Certificate to
which it is attached and may not thereafter be detached from such
Certificate to which it is to be affixed prior to the distribution of the
Final Withdrawal (the "Final Distribution"). After the Final Distribution,
no additional Escrow Receipts shall be issued and the Pass Through Trustee
shall request the return to the Escrow Agent for cancellation of all
outstanding Escrow Receipts.
Section 1.4 Payments to Receiptholders. All payments and
distributions made to holders of an Escrow Receipt (collectively
"Receiptholders") in respect of the Escrow Receipt shall be made only from
amounts deposited in the Paying Agent Account (as defined below) ("Account
Amounts"). Each Receiptholder, by its acceptance of an Escrow Receipt,
agrees that (a) it will look solely to the Account Amounts for any payment
or distribution due to such Receiptholder pursuant to the terms of the
Escrow Receipt and this Agreement and (b) it will have no recourse to US
Airways, the Pass Through Trustee, the Paying Agent or the Escrow Agent,
except as expressly provided herein or in the Pass Through Trust Agreement.
No Receiptholder shall have any right to vote or in any manner otherwise
control the operation and management of the Paying Agent Account or the
obligations of the parties hereto, nor shall anything set forth herein, or
contained in the terms of the Escrow Receipt, be construed so as to
constitute the Receiptholders from time to time as partners or members of
an association.
Section 1.5 Mutilated, Destroyed, Lost or Stolen Escrow
Receipt. If (a) any mutilated Escrow Receipt is surrendered to the Escrow
Agent or the Escrow Agent receives evidence to its satisfaction of the
destruction, loss or theft of any Escrow Receipt and (b) there is delivered
to the Escrow Agent and the Pass Through Trustee such security, indemnity
or bond, as may be required by them to hold each of them harmless, then,
absent notice to the Escrow Agent or the Pass Through Trustee that such
destroyed, lost or stolen Escrow Receipt has been acquired by a bona fide
purchaser, and provided that the requirements of Section 8-405 of the
Uniform Commercial Code in effect in any applicable jurisdiction are met,
the Escrow Agent shall execute, authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Escrow Receipt,
a new Escrow Receipt or Escrow Receipts and of like Escrow Interest in the
Account Amounts and bearing a number not contemporaneously outstanding.
In connection with the issuance of any new Escrow Receipt
under this Section 1.5, the Escrow Agent may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Pass Through Trustee and the Escrow Agent) connected
therewith.
Any duplicate Escrow Receipt issued pursuant to this Section
1.5 shall constitute conclusive evidence of the appropriate Escrow Interest
in the Account Amounts, as if originally issued, whether or not the lost,
stolen or destroyed Escrow Receipt shall be found at any
time.
The provisions of this Section 1.5 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect
to the replacement or payment of mutilated,
destroyed, lost or stolen Escrow Receipts.
Section 1.6 Additional Escrow Amounts. On the date of any
Purchase Withdrawal, the Pass Through Trustee may re-deposit with the
Depositary some or all of the amounts so withdrawn in accordance with
Section 2.4 of the Deposit Agreement.
Section 1.7 Resignation or Removal of Escrow Agent. Subject
to the appointment and acceptance of a successor Escrow Agent as provided
below, the Escrow Agent may resign at any time by giving thirty (30) days'
prior written notice thereof to the Investors, but may not otherwise be
removed except for cause by the written consent of the Investors with
respect to Investors representing Escrow Interests aggregating not less
than a majority in interest in the Account Amounts (an "Action of
Investors"). Upon any such resignation or removal, the Investors, by an
Action of Investors, shall have the right to appoint a successor Escrow
Agent. If no successor Escrow Agent shall have been so appointed and shall
have accepted such appointment within thirty (30) days after the retiring
Escrow Agent's giving of notice of resignation or the removal of the
retiring Escrow Agent, then the retiring Escrow Agent may appoint a
successor Escrow Agent. Any successor Escrow Agent shall be a bank which
has an office in the United States with a combined capital and surplus of
at least $100,000,000. Upon the acceptance of any appointment as Escrow
Agent hereunder by a successor Escrow Agent, such successor Escrow Agent
shall enter into such documents as the Pass Through Trustee shall require
and shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Escrow Agent, and the
retiring Escrow Agent shall be discharged from its duties and obligations
hereunder. No resignation or removal of the Escrow Agent shall be effective
unless a written confirmation shall have been obtained from each of Moody's
Investors Service, Inc. and Standard & Poor's Rating Services, a division
of The McGraw-Hill Companies, Inc., that the replacement of the Escrow
Agent with the successor Escrow Agent will not result in (a) a reduction of
the rating for the Certificates below the then current rating for the
Certificates or (b) a withdrawal or suspension of the rating of the
Certificates.
Section 1.8 Persons Deemed Owners. Prior to due presentment
of a Certificate for registration of transfer, the Escrow Agent and the
Paying Agent may treat the Person in whose name any Escrow Receipt is
registered (as of the day of determination) as the owner of such Escrow
Receipt for the purpose of receiving distributions pursuant to this
Agreement and for all other purposes whatsoever, and neither the Escrow
Agent nor the Paying Agent shall be affected by any notice to the contrary.
Section 1.9 Further Assurances. The Escrow Agent agrees to
take such actions, and execute such other documents, as may be reasonably
requested by the Pass Through Trustee in order to effectuate the purposes
of this Agreement and the performance by the Escrow Agent of its
obligations hereunder.
SECTION 2. Paying Agent.
Section 2.1 Appointment of Paying Agent. The Escrow Agent
hereby irrevocably appoints and authorizes the Paying Agent to act as its
paying agent hereunder, for the benefit of the Investors, for such specific
purposes and with such powers as are specifically delegated to the Paying
Agent by the terms of this Agreement, together with such other powers as
are reasonably incidental thereto. Any and all money received and held by
the Paying Agent under this Agreement or the Deposit Agreement shall be
held in the Paying Agent Account for the benefit of the Investors. The
Paying Agent (which term as used in this sentence shall include reference
to its affiliates and its own and its affiliates' officers, directors,
employees and agents):
(1) shall have no duties or responsibilities except those
expressly set forth in this Agreement, and shall not by reason of this
Agreement be a trustee for the Escrow Agent;
(2) shall not be responsible to the Escrow Agent for any
recitals, statements, representations or warranties of any person other
then itself contained in this Agreement or for the failure by the Escrow
Agent or any other person or entity (other than the Paying Agent) to
perform any of its obligations hereunder (whether or not the Paying Agent
shall have any knowledge thereof); and
(3) shall not be responsible for any action taken or omitted
to be taken by it hereunder or provided for herein or in connection
herewith, except for its own willful misconduct or gross negligence (or
simple negligence in connection with the handling of funds).
Section 2.2 Establishment of Paying Agent Account. The
Paying Agent shall establish a deposit account (the "Paying Agent Account")
at State Street Bank and Trust Company of Connecticut, National Association
in the name of the Escrow Agent. It is expressly understood by the parties
hereto that the Paying Agent is acting as the paying agent of the Escrow
Agent hereunder and that no amounts on deposit in the Paying Agent Account
constitute part of the Trust Property.
Section 2.3 Payments from Paying Agent Account. The Escrow
Agent hereby irrevocably instructs the Paying Agent, and the Paying Agent
agrees to act, as follows:
(1) On each Interest Payment Date (as defined in the Deposit
Agreement) or as soon thereafter as the Paying Agent has confirmed receipt
in the Paying Agent Account from the Depositary of any amount in respect of
accrued interest on the Deposits, the Paying Agent shall distribute out of
the Paying Agent Account the entire amount deposited therein by the
Depositary. There shall be so distributed to each Receiptholder of record
on the 15th day (whether or not a Business Day) preceding such Interest
Payment Date by check mailed to such Receiptholder, at the address
appearing in the Register, such Receiptholder's pro rata share (based on
the Escrow Interest in the Account Amounts held by such Receiptholder) of
the total amount of interest deposited by the Depositary in the Paying
Agent Account on such date, except that, with respect to Escrow Receipts
registered on the Record Date in the name of The Depository Trust Company,
a New York corporation ("DTC"), such distribution shall be made by wire
transfer in immediately available funds to the account designated by DTC.
(2) Upon the confirmation by the Paying Agent of receipt in
the Paying Agent Account from the Depositary of any amount in respect of
the Final Withdrawal, the Paying Agent shall forthwith distribute the
entire amount of the Final Withdrawal deposited therein by the Depositary.
There shall be so distributed to each Receiptholder of record on the 15th
day (whether or not a Business Day) preceding the Final Withdrawal Date by
check mailed to such Receiptholder, at the address appearing in the
Register, such Receiptholder's pro rata share (based on the Escrow Interest
in the Account Amounts held by such Receiptholder) of the total amount in
the Paying Agent Account on account of such Final Withdrawal, except that,
with respect to Escrow Receipts registered on the Record Date in the name
of DTC, such distribution shall be made by wire transfer in immediately
available funds to the account designated by DTC.
(3) If any payment of interest or principal in respect of
the Final Withdrawal is not received by the Paying Agent within five (5)
days of the applicable date when due, then it shall be distributed to
Receiptholders after actual receipt by the Paying Agent on the same basis
as a Special Payment is distributed under the Pass Through Trust Agreement.
(4) The Paying Agent shall include with any check mailed
pursuant to this Section any notice required to be distributed under the
Pass Through Trust Agreement that is furnished to the Paying Agent by the
Pass Through Trustee.
Section 2.4 Withholding Taxes. The Paying Agent shall
exclude and withhold from each distribution of accrued interest on the
Deposits (as defined in the Deposit Agreement) and any amount in respect of
the Final Withdrawal any and all withholding taxes applicable thereto as
required by law. The Paying Agent agrees to act as such withholding agent
and, in connection therewith, whenever any present or future taxes or
similar charges are required to be withheld with respect to any amounts
payable in respect of the Deposits (as defined in the Deposit Agreement) or
the escrow amounts, to withhold such amounts and timely pay the same to the
appropriate authority in the name of and on behalf of the Receiptholders,
that it will file any necessary withholding tax returns or statements when
due, and that, as promptly as possible after the payment thereof, it will
deliver to each such Receiptholder appropriate documentation showing the
payment thereof, together with such additional documentary evidence as such
Receiptholder may reasonably request from time to time. The Paying Agent
agrees to file any other information reports as it may be required to file
under United States law.
Section 2.5 Resignation or Removal of Paying Agent. Subject
to the appointment and acceptance of a successor Paying Agent as provided
below, the Paying Agent may resign at any time by giving thirty (30) days'
prior written notice thereof to the Escrow Agent, but may not otherwise be
removed except for cause by the Escrow Agent. Upon any such resignation or
removal, the Escrow Agent shall have the right to appoint a successor
Paying Agent. If no successor Paying Agent shall have been so appointed and
shall have accepted such appointment within thirty (30) days after the
retiring Paying Agent's giving of notice of resignation or the removal of
the retiring Paying Agent, then the retiring Paying Agent may appoint a
successor Paying Agent. Any Successor Paying Agent shall be a bank which
has an office in the United States with a combined capital and surplus of
at least US$100,000,000. Upon the acceptance of any appointment as Paying
Agent hereunder by a successor Paying Agent, such successor Paying Agent
shall enter into such documents as the Escrow Agent shall require and shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Paying Agent, and the retiring Paying
Agent shall be discharged from its duties and obligations hereunder.
Section 2.6 Notice of Final Withdrawal. Promptly after
receipt by the Paying Agent of notice that the Escrow Agent has requested a
Final Withdrawal or that a Final Withdrawal will be made, the Paying Agent
shall cause notice of the distribution of the Final Withdrawal to be mailed
to each of the Receiptholders at its address as it appears in the Register.
Such notice shall be mailed not less than fifteen (15) days prior to the
Final Withdrawal Date. Such notice shall set forth:
(1) the Final Withdrawal Date and the date for determining
Receiptholders of record who shall be entitled to receive distributions in
respect of the Final Withdrawal;
(2) the amount of the payment in respect of the Final
Withdrawal for each $1,000 face amount Certificate (based on information
provided by the Pass Through Trustee) and the amount thereof constituting
unused Deposits (as defined in the Deposit Agreement) and interest thereon;
and
(3) if the Final Withdrawal Date is the same date as a
Regular Distribution Date, the total amount to be received on such date for
each $1,000 face amount Certificate (based on information provided by the
Pass Through Trustee).
Such mailing may include any notice required to be given to
Certificateholders in connection with such distribution pursuant to the
Pass Through Trust Agreement.
SECTION 3. Payments. If, notwithstanding the instructions in
Article IV of the Deposit Agreement that all amounts payable to the Escrow
Agent under the Deposit Agreement be paid by the Depositary directly to the
Paying Agent or the Pass Through Trustee (depending on the circumstances),
the Escrow Agent receives any payment thereunder, then the Escrow Agent
shall forthwith pay such amount in Dollars and in immediately available
funds by wire transfer to (a) in the case of a payment of accrued interest
on the Deposits (as defined in the Deposit Agreement) or any Final
Withdrawal, directly to the Paying Agent Account and (b) in the case of any
Purchase Withdrawal, directly to the Pass Through Trustee or its designee
as specified and in the manner provided in the Applicable Notice of
Purchase Withdrawal. The Escrow Agent hereby waives any and all rights of
set-off, combination of accounts, right of retention or similar right
(whether arising under applicable law, contract or otherwise) it may have
against amounts payable to the Paying Agent howsoever arising.
SECTION 4. Other Actions. The Escrow Agent shall take such
other actions under or in respect of the Deposit Agreement (including,
without limitation, the enforcement of the obligations of the Depositary
thereunder) as the Investors, by an Action of Investors, may from time to
time request.
SECTION 5. Representations and Warranties of the Escrow
Agent. The Escrow Agent represents and warrants to US Airways, the
Investors, the Paying Agent and the Pass Through Trustee as follows:
(1) it is a national banking association duly organized and
validly existing in good standing under the laws of the United States of
America;
(2) it has full power, authority and legal right to conduct
its business and operations as currently conducted and to enter into and
perform its obligations under this Agreement and the Deposit Agreement;
(3) the execution, delivery and performance of each of this
Agreement and the Deposit Agreement have been duly authorized by all
necessary corporate action on the part of it and do not require any
stockholder approval, or approval or consent of any trustee or holder of
any indebtedness or obligations of it, and each such document has been duly
executed and delivered by it and constitutes its legal, valid and binding
obligations enforceable against it in accordance with the terms hereof or
thereof except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws or equitable
principles of general application to or affecting the enforcement of
creditors' rights generally (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(4) no authorization, consent or approval of or other action
by, and no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by it of this Agreement or the Deposit Agreement;
(5) neither the execution, delivery or performance by it of
this Agreement or the Deposit Agreement, nor compliance with the terms and
provisions hereof or thereof, conflicts or will conflict with or results or
will result in a breach or violation of any of the terms, conditions or
provisions of, or will require any consent or approval under, any law,
governmental rule or regulation or the charter documents, as amended, or
bylaws, as amended, of it or any similar instrument binding on it or any
order, writ, injunction or decree of any court or governmental authority
against it or by which it or any of its properties is bound or any
indenture, mortgage or contract or other agreement or instrument to which
it is a party or by which it or any of its properties is bound, or
constitutes or will constitute a default thereunder or results or will
result in the imposition of any lien upon any of its properties; and
(6) there are no pending or, to its knowledge, threatened
actions, suits, investigations or proceedings (whether or not purportedly
on behalf of it) against or affecting it or any of its property before or
by any court or administrative agency which, if adversely determined, (A)
would adversely affect the ability of it to perform its obligations under
this Agreement or the Deposit Agreement or (B) would call into question or
challenge the validity of this Agreement or the Deposit Agreement or the
enforceability hereof or thereof in accordance with the terms hereof or
thereof, nor is the Escrow Agent in default with respect to any order of
any court, governmental authority, arbitration board or administrative
agency so as to adversely affect its ability to perform its obligations
under this Agreement or the Deposit Agreement.
SECTION 6. Representations and Warranties of the Paying
Agent. The Paying Agent represents and warrants to US Airways, the
Investors, the Escrow Agent and the Pass Through Trustee as follows:
(1) it is a national banking association duly organized and
validly existing in good standing under the laws of the United States of
America;
(2) it has full power, authority and legal right to conduct
its business and operations as currently conducted and to enter into and
perform its obligations under this Agreement;
(3) the execution, delivery and performance of this
Agreement has been duly authorized by all necessary corporate action on the
part of it and does not require any stockholder approval, or approval or
consent of any trustee or holder of any indebtedness or obligations of it,
and such document has been duly executed and delivered by it and
constitutes its legal, valid and binding obligations enforceable against it
in accordance with the terms hereof except as such enforceability may be
limited by bankruptcy, insolvency, moratorium, reorganization or other
similar laws or equitable principles of general application to or affecting
the enforcement of creditors' rights generally (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(4) no authorization, consent or approval of or other action
by, and no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by it of this Agreement;
(5) neither the execution, delivery or performance by it of
this Agreement, nor compliance with the terms and provisions hereof,
conflicts or will conflict with or results or will result in a breach or
violation of any of the terms, conditions or provisions of, or will require
any consent or approval under, any law, governmental rule or regulation or
the charter documents, as amended, or bylaws, as amended, of it or any
similar instrument binding on it or any order, writ, injunction or decree
of any court or governmental authority against it or by which it or any of
its properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which it is a party or by which it or any of its
properties is bound, or constitutes or will constitute a default thereunder
or results or will result in the imposition of any lien upon any of its
properties; and
(6) there are no pending or, to its knowledge, threatened
actions, suits, investigations or proceedings (whether or not purportedly
on behalf of it) against or affecting it or any of its property before or
by any court or administrative agency which, if adversely determined, (A)
would adversely affect the ability of it to perform its obligations under
this Agreement or (B) would call into question or challenge the validity of
this Agreement or the enforceability hereof in accordance with the terms
hereof, nor is the Paying Agent in default with respect to any order of any
court, governmental authority, arbitration board or administrative agency
so as to adversely affect its ability to perform its obligations under this
Agreement.
SECTION 7. Indemnification. Except for actions expressly
required of the Escrow Agent or the Paying Agent hereunder, each of the
Escrow Agent and the Paying Agent shall in all cases be fully justified in
failing or refusing to act hereunder unless it shall have been indemnified
by the party requesting such action in a manner reasonably satisfactory to
it against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. In the event US
Airways requests any amendment to any Operative Document (as defined in the
Note Purchase Agreement), the Pass Through Trustee agrees to pay all
reasonable fees and expenses (including, without limitation, fees and
disbursements of counsel) of the Escrow Agent and the Paying Agent in
connection therewith.
SECTION 8. Amendment, Etc. Upon request of the Pass Through
Trustee and approval by an Action of Investors, the Escrow Agent shall
enter into an amendment to this Agreement, so long as such amendment does
not adversely affect the rights or obligations of the Escrow Agent or the
Paying Agent, provided that upon request of the Pass Through Trustee and
without any consent of the Investors, the Escrow Agent shall enter into an
amendment to this Agreement for any of the following purposes:
(1) to correct or supplement any provision in this Agreement
which may be defective or inconsistent with any other provision herein or
to cure any ambiguity or correct any mistake or to modify any other
provision with respect to matters or questions arising under this
Agreement, provided that any such action shall not materially adversely
affect the interests of the Investors; or
(2) to comply with any requirement of the SEC, applicable
law, rules or regulations of any exchange or quotation system on which the
Certificates are listed or any regulatory body; or
(3) to evidence and provide for the acceptance of
appointment under this Agreement of a successor Escrow Agent, successor
Paying Agent or successor Pass Through Trustee.
SECTION 9. Notices. Unless otherwise expressly provided
herein, any notice or other communication under this Agreement shall be in
writing (including by facsimile) and shall be deemed to be given and
effective upon receipt thereof. All notices shall be sent to (a) in the
case of the Investors, as their respective addresses shall appear in the
Register, (b) in the case of the Escrow Agent, First Security Bank,
National Association, 79 South Main Street, Salt Lake City, UT 84111,
Attention: Corporate Trust Services (Telecopier: (801) 246-5053), (c) in
the case of the Pass Through Trustee, State Street Bank and Trust Company
of Connecticut, National Association, 225 Asylum Street, Goodwyn Square,
Hartford, CT 06103, Attention: Corporate Trust Administration (Telecopier:
(860) 244-1889) or (d) in the case of the Paying Agent, State Street Bank
and Trust Company of Connecticut, National Association, 225 Asylum Street,
Goodwyn Square, Hartford, CT 06103, Attention: Corporate Trust/Muni.
Department (Telecopier: (617) 664-5151), in each case with a copy to US
Airways, US Airways, Inc., 2345 Crystal Drive, Arlington, VA 22227,
Attention: Treasurer (Telecopier: (703) 872-5936 (or at such other address
as any such party may specify from time to time in a written notice to the
other parties). On or prior to the execution of this Agreement, the Pass
Through Trustee has delivered to the Escrow Agent a certificate containing
specimen signatures of the representatives of the Pass Through Trustee who
are authorized to give notices and instructions with respect to this
Agreement. The Escrow Agent may conclusively rely on such certificate until
the Escrow Agent receives written notice from the Pass Through Trustee to
the contrary.
SECTION 10. Transfer. No party hereto shall be entitled to
assign or otherwise transfer this Agreement (or any interest herein) other
than (in the case of the Escrow Agent) to a successor escrow agent under
Section 1.7 hereof or (in the case of the Paying Agent) to a successor
paying agent under Section 2.5 hereof, and any purported assignment in
violation thereof shall be void. This Agreement shall be binding upon the
parties hereto and their respective successors and (in the case of the
Escrow Agent and the Paying Agent) their respective permitted assigns.
SECTION 11. Entire Agreement. This Agreement sets forth all
of the promises, covenants, agreements, conditions and understandings among
the Escrow Agent, the Paying Agent, the Underwriters and the Pass Through
Trustee with respect to the subject matter hereof, and supersedes all prior
and contemporaneous agreements and undertakings, inducements or conditions,
express or implied, oral or written.
SECTION 12. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York.
SECTION 13. WAIVER OF JURY TRIAL RIGHT. EACH OF THE ESCROW
AGENT, THE PAYING AGENT, THE INVESTORS AND THE PASS THROUGH TRUSTEE
ACKNOWLEDGES AND ACCEPTS THAT IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT SUCH PARTY IRREVOCABLY WAIVES ITS RIGHT TO
A TRIAL BY JURY.
SECTION 14. Counterparts. This Agreement may be executed in
one or more counterparts, all of which taken together shall constitute one
instrument.
IN WITNESS WHEREOF, the Escrow Agent, the Paying Agent, the
Underwriters and the Pass Through Trustee have caused this Escrow and
Paying Agent Agreement (Class A) to be duly executed as of the day and year
first above written.
STATE STREET BANK AND TRUST FIRST SECURITY BANK, NATIONAL
COMPANY OF CONNECTICUT, ASSOCIATION, as Escrow Agent
NATIONAL ASSOCIATION, not in
its individual capacity, but
solely as Pass Through Trustee
for and on behalf of US Airways
Pass Through Trust 1999-1A
By /s/ Brett R. King
------------------------
Name Brett R. King
Title: Vice President
By /s/ Julie A. Balerna
------------------------
Name Julie A. Balerna CREDIT SUISSE FIRST BOSTON
Title: Assistant Vice President CORPORATION, DEUTSCHE BANK
SECURITIES INC., DONALDSON, LUFKIN
& JENRETTE SECURITIES
CORPORATION, GOLDMAN, SACHS &
STATE STREET BANK AND TRUST CO. and SALOMON SMITH BARNEY INC.,
COMPANY OF CONNECTICUT, as Underwriters
NATIONAL ASSOCIATION as Paying Agent
BY: CREDIT SUISSE FIRST BOSTON
CORPORATION
By /s/ Julie A. Balerna
------------------------ By /s/ Thomas L. Smith
Name Julie A. Balerna ------------------------
Title: Assistant Vice President Name Thomas L. Smith
Title: Director
EXHIBIT A
---------
US Airways 1999-1A Escrow Receipt
No. __
This Escrow Receipt evidences a fractional undivided
interest in amounts ("Account Amounts") from time to time deposited into a
certain paying agent account (the "Paying Agent Account") described in the
Escrow and Paying Agent Agreement (Class A) dated as of August 31, 1999 (as
amended, modified or supplemented from time to time, the "Escrow and Paying
Agent Agreement") among First Security Bank, National Association, a
national banking association, as Escrow Agent (in such capacity, together
with its successors in such capacity, the "Escrow Agent"), Credit Suisse
First Boston Corporation, Deutsche Bank Securities Inc., Donaldson, Lufkin
& Jenrette Securities Corporation, Goldman, Sachs & Co., and Salomon Smith
Barney Inc., as Underwriters, State Street Bank and Trust Company of
Connecticut, National Association, as Pass Through Trustee (in such
capacity, together with its successors in such capacity, the "Pass Through
Trustee") and State Street Bank and Trust Company of Connecticut, National
Association as paying agent (in such capacity, together with its successors
in such capacity, the "Paying Agent"). Capitalized terms not defined herein
shall have the meanings assigned to them in the Escrow and Paying Agent
Agreement.
This Escrow Receipt is issued under and is subject to the
terms, provisions and conditions of the Escrow and Paying Agent Agreement.
By virtue of its acceptance hereof the holder of this Escrow Receipt
assents and agrees to be bound by the provisions of the Escrow and Paying
Agent Agreement and this Escrow Receipt.
This Escrow Receipt represents a fractional undivided
interest in amounts deposited from time to time in the Paying Agent
Account, and grants or represents no rights, benefits or interests of any
kind in respect of any assets or property other than such amounts. This
Escrow Receipt evidences the same percentage interest in the Account
Amounts as the Fractional Undivided Interest in the Pass Through Trust
evidenced by the Certificate to which this Escrow Receipt is affixed.
All payments and distributions made to Receiptholders in
respect of the Escrow Receipt shall be made only from Account Amounts
deposited in the Paying Agent Account. The holder of this Escrow Receipt,
by its acceptance of this Escrow Receipt, agrees that it will look solely
to the Account Amounts for any payment or distribution due to it pursuant
to this Escrow Receipt and that it will not have any recourse to US
Airways, the Pass Through Trustee, the Paying Agent or the Escrow Agent,
except as expressly provided herein, in the Escrow and Paying Agent
Agreement or in the Pass Through Trust Agreement. No Receiptholder of this
Escrow Receipt shall have any right to vote or in any manner otherwise
control the operation and management of the Paying Agent Account, nor shall
anything set forth herein, or contained in the terms of this Escrow
Receipt, be construed so as to constitute the Receiptholders from time to
time as partners or members of an association.
This Escrow Receipt may not be assigned or transferred
except in connection with the assignment or transfer of the Certificate to
which this Escrow Receipt is affixed. After payment to the holder hereof of
its Escrow Interest in the Final Distribution, upon the request of the Pass
Through Trustee, the holder hereof will return this Escrow Receipt to the
Pass Through Trustee.
The Paying Agent may treat the person in whose name the
Certificate to which this Escrow Receipt is attached as the owner hereof
for all purposes, and the Paying Agent shall
not be affected by any notice to the contrary.
THIS ESCROW RECEIPT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Escrow Agent has caused this Escrow
Receipt to be duly executed.
Dated: August 31, 1999
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
as Escrow Agent
By________________________________________
Name:
Title:
EXHIBIT B
---------
Withdrawal Certificate
(Class A)
First Security Bank, National Association,
as Escrow Agent
79 South Main Street
Salt Lake City, UT 84111
Attention: Corporate Trust Services
Telecopier: (801) 246-5053
Ladies and Gentlemen:
Reference is made to the Escrow and Paying Agent Agreement, dated as of
August 31, 1999, 1999 (the "Agreement"). We hereby certify to you that the
conditions to the obligations of the undersigned to execute a Participation
Agreement pursuant to the Note Purchase Agreement have been satisfied.
Pursuant to Section 1.2(c) of the Agreement, please execute the attached
Notice of Withdrawal and immediately transmit by facsimile to the
Depositary, at [ ].
Very truly yours,
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its
individual capacity but solely as
Pass Through Trustee
By_______________________________
Name:
Title:
Dated: __________, ___
NOTICE OF PURCHASE WITHDRAWAL
-----------------------------
ABN AMRO BANK N.V.
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Lukas Van der Hoef
Telecopier: (312) 606-8428
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class A) dated
as of August 31, 1999 (the "Deposit Agreement") between First Security
Bank, National Association, as Escrow Agent, and ABN AMRO BANK, N.V.,
Chicago Branch, as Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit Agreement,
the undersigned hereby requests the withdrawal of the entire amount of the
Deposit, $__________, Account No. __________.
The undersigned hereby directs the Depositary to pay the
proceeds of the Deposit to _______________, Account No. __________,
Reference: __________ on _______________, _____, upon the telephonic
request of a representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
By___________________________
Name:
Title:
Dated:___________, ____
Exhibit 4(a)(xi)
[GRAPHIC OMITTED]
ESCROW AND PAYING AGENT AGREEMENT
(Class B)
Dated as of August 31, 1999
among
FIRST SECURITY BANK, NATIONAL ASSOCIATION
as Escrow Agent
CREDIT SUISSE FIRST BOSTON CORPORATION
DEUTSCHE BANK SECURITIES INC.
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
GOLDMAN, SACHS & CO.
and
SALOMON SMITH BARNEY INC.
as Underwriters
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Pass Through Trustee
for and on behalf of
US Airways Pass Through Trust 1999-1B
as Pass Through Trustee
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
as Paying Agent
TABLE OF CONTENTS
Page
SECTION 1. Escrow Agent................................................ 2
Section 1.1 Appointment of Escrow Agent........................ 2
Section 1.2 Instruction, Etc................................... 3
Section 1.3 Initial Escrow Amount; Issuance of
Escrow Receipts.................................... 3
Section 1.4 Payments to Receiptholders......................... 4
Section 1.5 Mutilated, Destroyed, Lost or Stolen
Escrow Receipt..................................... 4
Section 1.6 Additional Escrow Amounts.......................... 5
Section 1.7 Resignation or Removal of Escrow Agent............. 5
Section 1.8 Persons Deemed Owners.............................. 5
Section 1.9 Further Assurances................................. 6
SECTION 2. Paying Agent................................................ 6
Section 2.1 Appointment of Paying Agent......................... 6
Section 2.2 Establishment of Paying Agent Account............... 6
Section 2.3 Payments from Paying Agent Account.................. 6
Section 2.4 Withholding Taxes................................... 7
Section 2.5 Resignation or Removal of Paying Agent.............. 8
Section 2.6 Notice of Final Withdrawal.......................... 8
SECTION 3. Payments.................................................... 8
SECTION 4. Other Actions............................................... 9
SECTION 5. Representations and Warranties of the Escrow Agent.......... 9
SECTION 6. Representations and Warranties of the Paying Agent..........10
SECTION 7. Indemnification.............................................11
SECTION 8. Amendment, Etc..............................................11
SECTION 9. Notices.....................................................12
SECTION 10. Transfer....................................................12
SECTION 11. Entire Agreement............................................13
SECTION 12. Governing Law...............................................13
SECTION 13. WAIVER OF JURY TRIAL RIGHT..................................13
SECTION 14. Counterparts................................................13
EXHIBITS
Exhibit A Escrow Receipt
Exhibit B Withdrawal Certificate
This ESCROW AND PAYING AGENT AGREEMENT (Class B) dated as of
August 31, 1999 (as amended, modified or supplemented from time to time,
this "Agreement") among First Security Bank, National Association, a
national banking association, as Escrow Agent (in such capacity, together
with its successors in such capacity, the "Escrow Agent"); Credit Suisse
First Boston Corporation, Deutsche Bank Securities Inc., Donaldson, Lufkin
& Jenrette Securities Corporation, Goldman, Sachs & Co., and Salomon Smith
Barney Inc., as Underwriters of the Certificates referred to below (the
"Underwriters" and together with their respective transferees and assigns
as registered owners of the Certificates, the "Investors") under the
Underwriting Agreement referred to below; State Street Bank and Trust
Company of Connecticut, National Association, a national banking
association, not in its individual capacity except as otherwise expressly
provided herein, but solely as trustee (in such capacity, together with its
successors in such capacity, the "Pass Through Trustee") under the Pass
Through Trust Agreement referred to below; and State Street Bank and Trust
Company of Connecticut, National Association, a national banking
association, as paying agent hereunder (in such capacity, together with its
successors in such capacity, the "Paying Agent").
W I T N E S S E T H
WHEREAS, US Airways, Inc. ("US Airways") and the Pass
Through Trustee have entered into a Trust Supplement, dated as of the date
hereof (the "Trust Supplement"), to the Pass Through Trust Agreement, dated
as of July 30, 1999 (together, as amended, modified or supplemented from
time to time in accordance with the terms thereof, the "Pass Through Trust
Agreement") relating to US Airways Pass Through Trust 1999-1B (the "Pass
Through Trust") pursuant to which the US Airways Pass Through Trust, Series
1999-1B Certificates referred to therein (the "Certificates") are being
issued;
WHEREAS, US Airways and the Underwriters have entered into
an Underwriting Agreement dated as of August 24, 1999 (as amended, modified
or supplemented from time to time in accordance with the terms thereof, the
"Underwriting Agreement") pursuant to which the Pass Through Trustee will
issue and sell the Certificates to the Underwriters;
WHEREAS, US Airways, the Pass Through Trustee, certain other
pass through trustees and certain other persons concurrently herewith are
entering into the Note Purchase Agreement, dated as of the date hereof (the
"Note Purchase Agreement"), pursuant to which the Pass Through Trustee has
agreed to acquire from time to time on or prior to the Delivery Period
Termination Date (as defined in the Note Purchase Agreement) equipment
notes (the "Equipment Notes") issued to finance the acquisition of aircraft
by US Airways, as lessee or as owner, utilizing a portion of the proceeds
from the sale of the Certificates (the "Net Proceeds");
WHEREAS, the Underwriters and the Pass Through Trustee
intend that the Net Proceeds be held in escrow by the Escrow Agent on
behalf of the Investors, subject to withdrawal upon request by the Pass
Through Trustee and satisfaction of the conditions set forth in the Note
Purchase Agreement for the purpose of purchasing Equipment Notes, and that
pending such withdrawal the Net Proceeds be deposited on behalf of the
Escrow Agent with
ABN AMRO BANK N.V., acting through its Chicago branch, as Depositary (the
"Depositary") under the Deposit Agreement, dated as of the date hereof
between the Depositary and the Escrow Agent relating to the Pass Through
Trust (as amended, modified or supplemented from time to time in accordance
with the terms thereof, the "Deposit Agreement") pursuant to which, among
other things, the Depositary will pay interest for distribution to the
Investors and establish accounts from which the Escrow Agent shall make
withdrawals upon request of and proper certification by the Pass Through
Trustee;
WHEREAS, the Escrow Agent wishes to appoint the Paying Agent
to pay amounts required to be distributed to the Investors in accordance
with this Agreement; and
WHEREAS, capitalized terms used but not defined herein shall
have the respective meanings set forth or incorporated by reference in the
Pass Through Trust Agreement.
NOW, THEREFORE, in consideration of the obligations
contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. Escrow Agent.
Section 1.1 Appointment of Escrow Agent. Each of the
Underwriters, for and on behalf of each of the Investors, hereby
irrevocably appoints, authorizes and directs the Escrow Agent to act as
escrow agent and fiduciary hereunder and under the Deposit Agreement for
such specific purposes and with such powers as are specifically delegated
to the Escrow Agent by the terms of this Agreement, together with such
other powers as are reasonably incidental thereto. Any and all money
received and held by the Escrow Agent under this Agreement or the Deposit
Agreement shall be held in escrow by the Escrow Agent in accordance with
the terms of this Agreement. This Agreement is irrevocable and the
Investors' rights with respect to any monies received and held in escrow by
the Escrow Agent under this Agreement or the Deposit Agreement shall only
be as provided under the terms and conditions of this Agreement and the
Deposit Agreement. The Escrow Agent (which term as used in this sentence
shall include reference to its affiliates and its own and its affiliates'
officers, directors, employees and agents):
(1) shall have no duties or responsibilities except those
expressly set forth in this Agreement;
(2) shall not be responsible to the Pass Through Trustee or
the Investors for any recitals, statements, representations or warranties
of any person other then itself contained in this Agreement or the Deposit
Agreement or for the failure by the Pass Through Trustee, the Investors or
any other person or entity (other than the Escrow Agent) to perform any of
its obligations hereunder (whether or not the Escrow Agent shall have any
knowledge thereof); and
(3) shall not be responsible for any action taken or omitted
to be taken by it hereunder or provided for herein or in connection
herewith, except for its own willful misconduct or gross negligence (or
simple negligence in connection with the handling of funds).
Section 1.2 Instruction, Etc. The Underwriters, for and on
behalf of each of the Investors, hereby irrevocably instruct the Escrow
Agent, and the Escrow Agent agrees: (a) to enter into the Deposit
Agreement; (b) to appoint the Paying Agent as provided in this Agreement;
(c) upon receipt at any time and from time to time prior to the Termination
Date (as defined below) of a certificate substantially in the form of
Exhibit B hereto (a "Withdrawal Certificate") executed by the Pass Through
Trustee, together with an attached Notice of Purchase Withdrawal in
substantially the form of Exhibit A to the Deposit Agreement duly completed
by the Pass Through Trustee (the "Applicable Notice of Purchase Withdrawal"
and the withdrawal to which it relates, a "Purchase Withdrawal"),
immediately to execute the Applicable Notice of Purchase Withdrawal as
Escrow Agent and transmit it to the Depositary by facsimile transmission in
accordance with the Deposit Agreement; provided that, upon the request of
the Pass Through Trustee after such transmission, the Escrow Agent shall
cancel such Applicable Notice of Purchase Withdrawal; and (d) if there are
any undrawn Deposits (as defined in the Deposit Agreement) on the
"Termination Date", which shall mean the earlier of (i) July 20, 2000 and
(ii) the day on which the Escrow Agent receives notice from the Pass
Through Trustee that the Pass Through Trustee's obligation to purchase
Equipment Notes under the Note Purchase Agreement has terminated, to give
notice to the Depositary (with a copy to the Paying Agent) substantially in
the form of Exhibit B to the Deposit Agreement requesting a withdrawal of
all of the remaining Deposits, together with accrued and unpaid interest on
such Deposits to the date of withdrawal, on the 15th day after the date
that such notice of withdrawal is given to the Depositary (or, if not a
Business Day, on the next succeeding Business Day) (a "Final Withdrawal"),
provided that if the day scheduled for the Final Withdrawal in accordance
with the foregoing is within ten days before or after a Regular
Distribution Date, then the Escrow Agent shall request that such requested
Final Withdrawal be made on such Regular Distribution Date (the date of
such requested withdrawal, the "Final Withdrawal Date"). If for any reason
the Escrow Agent shall have failed to give the Final Withdrawal Notice to
the Depositary on or before July 21, 2000, and there are unwithdrawn
Deposits on such date, the Final Withdrawal Date shall be deemed to be
August 7, 2000.
Section 1.3 Initial Escrow Amount; Issuance of Escrow
Receipts. The Escrow Agent hereby directs the Underwriters to, and the
Underwriters hereby acknowledge that on the date hereof they shall,
irrevocably deliver to the Depositary on behalf of the Escrow Agent, an
amount in U.S. dollars ("Dollars") and immediately available funds equal to
$83,384,000 for deposit on behalf of the Escrow Agent with the Depositary
in accordance with Section 2.1 of the Deposit Agreement. The Underwriters
hereby instruct the Escrow Agent, upon the Depositary's receipt (on behalf
of the Escrow Agent) of such sum from the Underwriters, to confirm such
receipt by executing and delivering to the Pass Through Trustee an Escrow
Receipt in the form of Exhibit A hereto (an "Escrow Receipt"), (a) to be
affixed by the Pass Through Trustee to each Certificate and (b) to evidence
the same percentage interest (the "Escrow Interest") in the Account Amounts
(as defined below) as the Fractional Undivided Interest in the Pass Through
Trust evidenced by the Certificate to which it is to be affixed. The Escrow
Agent shall provide to the Pass Through Trustee for attachment to each
Certificate newly issued under and in accordance with the Pass Through
Trust Agreement an executed Escrow Receipt as the Pass Through Trustee may
from time to time request of the Escrow Agent. Each Escrow Receipt shall be
registered by the Escrow Agent in a register (the "Register") maintained by
the Escrow Agent in the same name and same manner as the Certificate to
which it is attached and may not thereafter be detached from such
Certificate to which it is to be affixed prior to the distribution of the
Final Withdrawal (the "Final Distribution"). After the Final Distribution,
no additional Escrow Receipts shall be issued and the Pass Through Trustee
shall request the return to the Escrow Agent for cancellation of all
outstanding Escrow Receipts.
Section 1.4 Payments to Receiptholders. All payments and
distributions made to holders of an Escrow Receipt (collectively
"Receiptholders") in respect of the Escrow Receipt shall be made only from
amounts deposited in the Paying Agent Account (as defined below) ("Account
Amounts"). Each Receiptholder, by its acceptance of an Escrow Receipt,
agrees that (a) it will look solely to the Account Amounts for any payment
or distribution due to such Receiptholder pursuant to the terms of the
Escrow Receipt and this Agreement and (b) it will have no recourse to US
Airways, the Pass Through Trustee, the Paying Agent or the Escrow Agent,
except as expressly provided herein or in the Pass Through Trust Agreement.
No Receiptholder shall have any right to vote or in any manner otherwise
control the operation and management of the Paying Agent Account or the
obligations of the parties hereto, nor shall anything set forth herein, or
contained in the terms of the Escrow Receipt, be construed so as to
constitute the Receiptholders from time to time as partners or members of
an association.
Section 1.5 Mutilated, Destroyed, Lost or Stolen Escrow
Receipt. If (a) any mutilated Escrow Receipt is surrendered to the Escrow
Agent or the Escrow Agent receives evidence to its satisfaction of the
destruction, loss or theft of any Escrow Receipt and (b) there is delivered
to the Escrow Agent and the Pass Through Trustee such security, indemnity
or bond, as may be required by them to hold each of them harmless, then,
absent notice to the Escrow Agent or the Pass Through Trustee that such
destroyed, lost or stolen Escrow Receipt has been acquired by a bona fide
purchaser, and provided that the requirements of Section 8-405 of the
Uniform Commercial Code in effect in any applicable jurisdiction are met,
the Escrow Agent shall execute, authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Escrow Receipt,
a new Escrow Receipt or Escrow Receipts and of like Escrow Interest in the
Account Amounts and bearing a number not contemporaneously outstanding.
In connection with the issuance of any new Escrow Receipt
under this Section 1.5, the Escrow Agent may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Pass Through Trustee and the Escrow Agent) connected
therewith.
Any duplicate Escrow Receipt issued pursuant to this Section
1.5 shall constitute conclusive evidence of the appropriate Escrow Interest
in the Account Amounts, as if originally issued, whether or not the lost,
stolen or destroyed Escrow Receipt shall be found at any
time.
The provisions of this Section 1.5 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect
to the replacement or payment of mutilated, destroyed, lost or stolen
Escrow Receipts.
Section 1.6 Additional Escrow Amounts. On the date of any
Purchase Withdrawal, the Pass Through Trustee may re-deposit with the
Depositary some or all of the amounts so withdrawn in accordance with
Section 2.4 of the Deposit Agreement.
Section 1.7 Resignation or Removal of Escrow Agent. Subject
to the appointment and acceptance of a successor Escrow Agent as provided
below, the Escrow Agent may resign at any time by giving thirty (30) days'
prior written notice thereof to the Investors, but may not otherwise be
removed except for cause by the written consent of the Investors with
respect to Investors representing Escrow Interests aggregating not less
than a majority in interest in the Account Amounts (an "Action of
Investors"). Upon any such resignation or removal, the Investors, by an
Action of Investors, shall have the right to appoint a successor Escrow
Agent. If no successor Escrow Agent shall have been so appointed and shall
have accepted such appointment within thirty (30) days after the retiring
Escrow Agent's giving of notice of resignation or the removal of the
retiring Escrow Agent, then the retiring Escrow Agent may appoint a
successor Escrow Agent. Any successor Escrow Agent shall be a bank which
has an office in the United States with a combined capital and surplus of
at least $100,000,000. Upon the acceptance of any appointment as Escrow
Agent hereunder by a successor Escrow Agent, such successor Escrow Agent
shall enter into such documents as the Pass Through Trustee shall require
and shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Escrow Agent, and the
retiring Escrow Agent shall be discharged from its duties and obligations
hereunder. No resignation or removal of the Escrow Agent shall be effective
unless a written confirmation shall have been obtained from each of Moody's
Investors Service, Inc. and Standard & Poor's Rating Services, a division
of The McGraw-Hill Companies, Inc., that the replacement of the Escrow
Agent with the successor Escrow Agent will not result in (a) a reduction of
the rating for the Certificates below the then current rating for the
Certificates or (b) a withdrawal or suspension of the rating of the
Certificates.
Section 1.8 Persons Deemed Owners. Prior to due presentment
of a Certificate for registration of transfer, the Escrow Agent and the
Paying Agent may treat the Person in whose name any Escrow Receipt is
registered (as of the day of determination) as the owner of such Escrow
Receipt for the purpose of receiving distributions pursuant to this
Agreement and for all other purposes whatsoever, and neither the Escrow
Agent nor the Paying Agent shall be affected by any notice to the contrary.
Section 1.9 Further Assurances. The Escrow Agent agrees to
take such actions, and execute such other documents, as may be reasonably
requested by the Pass Through Trustee in order to effectuate the purposes
of this Agreement and the performance by the Escrow Agent of its
obligations hereunder.
SECTION 2. Paying Agent.
Section 2.1 Appointment of Paying Agent. The Escrow Agent
hereby irrevocably appoints and authorizes the Paying Agent to act as its
paying agent hereunder, for the benefit of the Investors, for such specific
purposes and with such powers as are specifically delegated to the Paying
Agent by the terms of this Agreement, together with such other powers as
are reasonably incidental thereto. Any and all money received and held by
the Paying Agent under this Agreement or the Deposit Agreement shall be
held in the Paying Agent Account for the benefit of the Investors. The
Paying Agent (which term as used in this sentence shall include reference
to its affiliates and its own and its affiliates' officers, directors,
employees and agents):
(1) shall have no duties or responsibilities except those
expressly set forth in this Agreement, and shall not by reason of this
Agreement be a trustee for the Escrow Agent;
(2) shall not be responsible to the Escrow Agent for any
recitals, statements, representations or warranties of any person other
then itself contained in this Agreement or for the failure by the Escrow
Agent or any other person or entity (other than the Paying Agent) to
perform any of its obligations hereunder (whether or not the Paying Agent
shall have any knowledge thereof); and
(3) shall not be responsible for any action taken or omitted
to be taken by it hereunder or provided for herein or in connection
herewith, except for its own willful misconduct or gross negligence (or
simple negligence in connection with the handling of funds).
Section 2.2 Establishment of Paying Agent Account. The
Paying Agent shall establish a deposit account (the "Paying Agent Account")
at State Street Bank and Trust Company of Connecticut, National Association
in the name of the Escrow Agent. It is expressly understood by the parties
hereto that the Paying Agent is acting as the paying agent of the Escrow
Agent hereunder and that no amounts on deposit in the Paying Agent Account
constitute part of the Trust Property.
Section 2.3 Payments from Paying Agent Account. The Escrow
Agent hereby irrevocably instructs the Paying Agent, and the Paying Agent
agrees to act, as follows:
(1) On each Interest Payment Date (as defined in the Deposit
Agreement) or as soon thereafter as the Paying Agent has confirmed receipt
in the Paying Agent Account from the Depositary of any amount in respect of
accrued interest on the Deposits, the Paying Agent shall distribute out of
the Paying Agent Account the entire amount deposited therein by the
Depositary. There shall be so distributed to each Receiptholder of record
on the 15th day (whether or not a Business Day) preceding such Interest
Payment Date by check mailed to such Receiptholder, at the address
appearing in the Register, such Receiptholder's pro rata share (based on
the Escrow Interest in the Account Amounts held by such Receiptholder) of
the total amount of interest deposited by the Depositary in the Paying
Agent Account on such date, except that, with respect to Escrow Receipts
registered on the Record Date in the name of The Depository Trust Company,
a New York corporation ("DTC"), such distribution shall be made by wire
transfer in immediately available funds to the account designated by DTC.
(2) Upon the confirmation by the Paying Agent of receipt in
the Paying Agent Account from the Depositary of any amount in respect of
the Final Withdrawal, the Paying Agent shall forthwith distribute the
entire amount of the Final Withdrawal deposited therein by the Depositary.
There shall be so distributed to each Receiptholder of record on the 15th
day (whether or not a Business Day) preceding the Final Withdrawal Date by
check mailed to such Receiptholder, at the address appearing in the
Register, such Receiptholder's pro rata share (based on the Escrow Interest
in the Account Amounts held by such Receiptholder) of the total amount in
the Paying Agent Account on account of such Final Withdrawal, except that,
with respect to Escrow Receipts registered on the Record Date in the name
of DTC, such distribution shall be made by wire transfer in immediately
available funds to the account designated by DTC.
(3) If any payment of interest or principal in respect of
the Final Withdrawal is not received by the Paying Agent within five (5)
days of the applicable date when due, then it shall be distributed to
Receiptholders after actual receipt by the Paying Agent on the same basis
as a Special Payment is distributed under the Pass Through Trust Agreement.
(4) The Paying Agent shall include with any check mailed
pursuant to this Section any notice required to be distributed under the
Pass Through Trust Agreement that is furnished to the Paying Agent by the
Pass Through Trustee.
Section 2.4 Withholding Taxes. The Paying Agent shall
exclude and withhold from each distribution of accrued interest on the
Deposits (as defined in the Deposit Agreement) and any amount in respect of
the Final Withdrawal any and all withholding taxes applicable thereto as
required by law. The Paying Agent agrees to act as such withholding agent
and, in connection therewith, whenever any present or future taxes or
similar charges are required to be withheld with respect to any amounts
payable in respect of the Deposits (as defined in the Deposit Agreement) or
the escrow amounts, to withhold such amounts and timely pay the same to the
appropriate authority in the name of and on behalf of the Receiptholders,
that it will file any necessary withholding tax returns or statements when
due, and that, as promptly as possible after the payment thereof, it will
deliver to each such Receiptholder appropriate documentation showing the
payment thereof, together with such additional documentary evidence as such
Receiptholder may reasonably request from time to time. The Paying Agent
agrees to file any other information reports as it may be required to file
under United States law.
Section 2.5 Resignation or Removal of Paying Agent. Subject
to the appointment and acceptance of a successor Paying Agent as provided
below, the Paying Agent may resign at any time by giving thirty (30) days'
prior written notice thereof to the Escrow Agent, but may not otherwise be
removed except for cause by the Escrow Agent. Upon any such resignation or
removal, the Escrow Agent shall have the right to appoint a successor
Paying Agent. If no successor Paying Agent shall have been so appointed and
shall have accepted such appointment within thirty (30) days after the
retiring Paying Agent's giving of notice of resignation or the removal of
the retiring Paying Agent, then the retiring Paying Agent may appoint a
successor Paying Agent. Any Successor Paying Agent shall be a bank which
has an office in the United States with a combined capital and surplus of
at least US$100,000,000. Upon the acceptance of any appointment as Paying
Agent hereunder by a successor Paying Agent, such successor Paying Agent
shall enter into such documents as the Escrow Agent shall require and shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Paying Agent, and the retiring Paying
Agent shall be discharged from its duties and obligations hereunder.
Section 2.6 Notice of Final Withdrawal. Promptly after
receipt by the Paying Agent of notice that the Escrow Agent has requested a
Final Withdrawal or that a Final Withdrawal will be made, the Paying Agent
shall cause notice of the distribution of the Final Withdrawal to be mailed
to each of the Receiptholders at its address as it appears in the Register.
Such notice shall be mailed not less than fifteen (15) days prior to the
Final Withdrawal Date. Such notice shall set forth:
(1) the Final Withdrawal Date and the date for determining
Receiptholders of record who shall be entitled to receive distributions in
respect of the Final Withdrawal;
(2) the amount of the payment in respect of the Final
Withdrawal for each $1,000 face amount Certificate (based on information
provided by the Pass Through Trustee) and the amount thereof constituting
unused Deposits (as defined in the Deposit Agreement) and interest thereon;
and
(3) if the Final Withdrawal Date is the same date as a
Regular Distribution Date, the total amount to be received on such date for
each $1,000 face amount Certificate (based
on information provided by the Pass Through Trustee).
Such mailing may include any notice required to be given to
Certificateholders in connection with such distribution pursuant to the
Pass Through Trust Agreement.
SECTION 3. Payments. If, notwithstanding the instructions in
Article IV of the Deposit Agreement that all amounts payable to the Escrow
Agent under the Deposit Agreement be paid by the Depositary directly to the
Paying Agent or the Pass Through Trustee (depending on the circumstances),
the Escrow Agent receives any payment thereunder, then the Escrow Agent
shall forthwith pay such amount in Dollars and in immediately available
funds by wire transfer to (a) in the case of a payment of accrued interest
on the Deposits (as defined in the Deposit Agreement) or any Final
Withdrawal, directly to the Paying Agent Account and (b) in the case of any
Purchase Withdrawal, directly to the Pass Through Trustee or its designee
as specified and in the manner provided in the Applicable Notice of
Purchase Withdrawal. The Escrow Agent hereby waives any and all rights of
set-off, combination of accounts, right of retention or similar right
(whether arising under applicable law, contract or otherwise) it may have
against amounts payable to the Paying Agent howsoever arising.
SECTION 4. Other Actions. The Escrow Agent shall take such
other actions under or in respect of the Deposit Agreement (including,
without limitation, the enforcement of the obligations of the Depositary
thereunder) as the Investors, by an Action of Investors, may from time to
time request.
SECTION 5. Representations and Warranties of the Escrow
Agent. The Escrow Agent represents and warrants to US Airways, the
Investors, the Paying Agent and the Pass Through Trustee as follows:
(1) it is a national banking association duly organized and
validly existing in good standing under the laws of the United States of
America;
(2) it has full power, authority and legal right to conduct
its business and operations as currently conducted and to enter into and
perform its obligations under this Agreement and the Deposit Agreement;
(3) the execution, delivery and performance of each of this
Agreement and the Deposit Agreement have been duly authorized by all
necessary corporate action on the part of it and do not require any
stockholder approval, or approval or consent of any trustee or holder of
any indebtedness or obligations of it, and each such document has been duly
executed and delivered by it and constitutes its legal, valid and binding
obligations enforceable against it in accordance with the terms hereof or
thereof except as such enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws or equitable
principles of general application to or affecting the enforcement of
creditors' rights generally (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(4) no authorization, consent or approval of or other action
by, and no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by it of this Agreement or the Deposit Agreement;
(5) neither the execution, delivery or performance by it of
this Agreement or the Deposit Agreement, nor compliance with the terms and
provisions hereof or thereof, conflicts or will conflict with or results or
will result in a breach or violation of any of the terms, conditions or
provisions of, or will require any consent or approval under, any law,
governmental rule or regulation or the charter documents, as amended, or
bylaws, as amended, of it or any similar instrument binding on it or any
order, writ, injunction or decree of any court or governmental authority
against it or by which it or any of its properties is bound or any
indenture, mortgage or contract or other agreement or instrument to which
it is a party or by which it or any of its properties is bound, or
constitutes or will constitute a default thereunder or results or will
result in the imposition of any lien upon any of its properties; and
(6) there are no pending or, to its knowledge, threatened
actions, suits, investigations or proceedings (whether or not purportedly
on behalf of it) against or affecting it or any of its property before or
by any court or administrative agency which, if adversely determined, (A)
would adversely affect the ability of it to perform its obligations under
this Agreement or the Deposit Agreement or (B) would call into question or
challenge the validity of this Agreement or the Deposit Agreement or the
enforceability hereof or thereof in accordance with the terms hereof or
thereof, nor is the Escrow Agent in default with respect to any order of
any court, governmental authority, arbitration board or administrative
agency so as to adversely affect its ability to perform its obligations
under this Agreement or the Deposit Agreement.
SECTION 6. Representations and Warranties of the Paying
Agent. The Paying Agent represents and warrants to US Airways, the
Investors, the Escrow Agent and the Pass Through Trustee as follows:
(1) it is a national banking association duly organized and
validly existing in good standing under the laws of the United States of
America;
(2) it has full power, authority and legal right to conduct
its business and operations as currently conducted and to enter into and
perform its obligations under this Agreement;
(3) the execution, delivery and performance of this
Agreement has been duly authorized by all necessary corporate action on the
part of it and does not require any stockholder approval, or approval or
consent of any trustee or holder of any indebtedness or obligations of it,
and such document has been duly executed and delivered by it and
constitutes its legal, valid and binding obligations enforceable against it
in accordance with the terms hereof except as such enforceability may be
limited by bankruptcy, insolvency, moratorium, reorganization or other
similar laws or equitable principles of general application to or affecting
the enforcement of creditors' rights generally (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(4) no authorization, consent or approval of or other action
by, and no notice to or filing with, any United States federal or state
governmental authority or regulatory body is required for the execution,
delivery or performance by it of this Agreement;
(5) neither the execution, delivery or performance by it of
this Agreement, nor compliance with the terms and provisions hereof,
conflicts or will conflict with or results or will result in a breach or
violation of any of the terms, conditions or provisions of, or will require
any consent or approval under, any law, governmental rule or regulation or
the charter documents, as amended, or bylaws, as amended, of it or any
similar instrument binding on it or any order, writ, injunction or decree
of any court or governmental authority against it or by which it or any of
its properties is bound or any indenture, mortgage or contract or other
agreement or instrument to which it is a party or by which it or any of its
properties is bound, or constitutes or will constitute a default thereunder
or results or will result in the imposition of any lien upon any of its
properties; and
(6) there are no pending or, to its knowledge, threatened
actions, suits, investigations or proceedings (whether or not purportedly
on behalf of it) against or affecting it or any of its property before or
by any court or administrative agency which, if adversely determined, (A)
would adversely affect the ability of it to perform its obligations under
this Agreement or (B) would call into question or challenge the validity of
this Agreement or the enforceability hereof in accordance with the terms
hereof, nor is the Paying Agent in default with respect to any order of any
court, governmental authority, arbitration board or administrative agency
so as to adversely affect its ability to perform its obligations under this
Agreement.
SECTION 7. Indemnification. Except for actions expressly
required of the Escrow Agent or the Paying Agent hereunder, each of the
Escrow Agent and the Paying Agent shall in all cases be fully justified in
failing or refusing to act hereunder unless it shall have been indemnified
by the party requesting such action in a manner reasonably satisfactory to
it against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. In the event US
Airways requests any amendment to any Operative Document (as defined in the
Note Purchase Agreement), the Pass Through Trustee agrees to pay all
reasonable fees and expenses (including, without limitation, fees and
disbursements of counsel) of the Escrow Agent and the Paying Agent in
connection therewith.
SECTION 8. Amendment, Etc. Upon request of the Pass Through
Trustee and approval by an Action of Investors, the Escrow Agent shall
enter into an amendment to this Agreement, so long as such amendment does
not adversely affect the rights or obligations of the Escrow Agent or the
Paying Agent, provided that upon request of the Pass Through Trustee and
without any consent of the Investors, the Escrow Agent shall enter into an
amendment to this Agreement for any of the following purposes:
(1) to correct or supplement any provision in this Agreement
which may be defective or inconsistent with any other provision herein or
to cure any ambiguity or correct any mistake or to modify any other
provision with respect to matters or questions arising under this
Agreement, provided that any such action shall not materially adversely
affect the interests of the Investors; or
(2) to comply with any requirement of the SEC, applicable
law, rules or regulations of any exchange or quotation system on which the
Certificates are listed or any regulatory body; or
(3) to evidence and provide for the acceptance of
appointment under this Agreement of a successor Escrow Agent, successor
Paying Agent or successor Pass Through Trustee.
SECTION 9. Notices. Unless otherwise expressly provided
herein, any notice or other communication under this Agreement shall be in
writing (including by facsimile) and shall be deemed to be given and
effective upon receipt thereof. All notices shall be sent to (a) in the
case of the Investors, as their respective addresses shall appear in the
Register, (b) in the case of the Escrow Agent, First Security Bank,
National Association, 79 South Main Street, Salt Lake City, UT 84111,
Attention: Corporate Trust Services (Telecopier: (801) 246-5053), (c) in
the case of the Pass Through Trustee, State Street Bank and Trust Company
of Connecticut, National Association, 225 Asylum Street, Goodwyn Square,
Hartford, CT 06103, Attention: Corporate Trust Administration (Telecopier:
(860) 244-1889) or (d) in the case of the Paying Agent, State Street Bank
and Trust Company of Connecticut, National Association, 225 Asylum Street,
Goodwyn Square, Hartford, CT 06103, Attention: Corporate Trust/Muni.
Department (Telecopier: (617) 664-5151), in each case with a copy to US
Airways, US Airways, Inc., 2345 Crystal Drive, Arlington, VA 22227,
Attention: Treasurer (Telecopier: (703) 872-5936 (or at such other address
as any such party may specify from time to time in a written notice to the
other parties). On or prior to the execution of this Agreement, the Pass
Through Trustee has delivered to the Escrow Agent a certificate containing
specimen signatures of the representatives of the Pass Through Trustee who
are authorized to give notices and instructions with respect to this
Agreement. The Escrow Agent may conclusively rely on such certificate until
the Escrow Agent receives written notice from the Pass Through Trustee to
the contrary.
SECTION 10. Transfer. No party hereto shall be entitled to
assign or otherwise transfer this Agreement (or any interest herein) other
than (in the case of the Escrow Agent) to a successor escrow agent under
Section 1.7 hereof or (in the case of the Paying Agent) to a successor
paying agent under Section 2.5 hereof, and any purported assignment in
violation thereof shall be void. This Agreement shall be binding upon the
parties hereto and their respective successors and (in the case of the
Escrow Agent and the Paying Agent) their respective permitted assigns.
SECTION 11. Entire Agreement. This Agreement sets forth all
of the promises, covenants, agreements, conditions and understandings among
the Escrow Agent, the Paying Agent, the Underwriters and the Pass Through
Trustee with respect to the subject matter hereof, and supersedes all prior
and contemporaneous agreements and undertakings, inducements or conditions,
express or implied, oral or written.
SECTION 12. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York.
SECTION 13. WAIVER OF JURY TRIAL RIGHT. EACH OF THE ESCROW
AGENT, THE PAYING AGENT, THE INVESTORS AND THE PASS THROUGH TRUSTEE
ACKNOWLEDGES AND ACCEPTS THAT IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT SUCH PARTY IRREVOCABLY WAIVES ITS RIGHT TO
A TRIAL BY JURY.
SECTION 14. Counterparts. This Agreement may be executed in
one or more counterparts, all of which taken together shall constitute one
instrument.
IN WITNESS WHEREOF, the Escrow Agent, the Paying Agent, the
Underwriters and the Pass Through Trustee have caused this Escrow and
Paying Agent Agreement (Class B) to be duly executed as of the day and year
first above written.
STATE STREET BANK AND TRUST FIRST SECURITY BANK, NATIONAL
COMPANY OF CONNECTICUT, ASSOCIATION, as Escrow Agent
NATIONAL ASSOCIATION, not in
its individual capacity, but
solely as Pass Through Trustee
for and on behalf of US Airways
Pass Through Trust 1999-1B
By /s/ Brett R. King
__________________________
Name Brett R. King
Title: Vice President
By /s/ Julie A. Balerna
_____________________________
Name Julie A. Balerna CREDIT SUISSE FIRST BOSTON
Title: Assistant Vice President CORPORATION, DEUTSCHE BANK
SECURITIES INC., DONALDSON, LUFKIN
& JENRETTE SECURITIES
CORPORATION, GOLDMAN, SACHS &
STATE STREET BANK AND TRUST CO. and SALOMON SMITH BARNEY INC.,
COMPANY OF CONNECTICUT, as Underwriters
NATIONAL ASSOCIATION as Paying Agent
BY: CREDIT SUISSE FIRST BOSTON
CORPORATION
By /s/ Julie A. Balerna
____________________________ By /s/ Thomas L. Smith
Name Julie A. Balerna ____________________________
Title: Assistant Vice President Name Thomas L. Smith
Title: Director
EXHIBIT A
---------
US Airways 1999-1B Escrow Receipt
No. __
This Escrow Receipt evidences a fractional undivided
interest in amounts ("Account Amounts") from time to time deposited into a
certain paying agent account (the "Paying Agent Account") described in the
Escrow and Paying Agent Agreement (Class B) dated as of August 31, 1999 (as
amended, modified or supplemented from time to time, the "Escrow and Paying
Agent Agreement") among First Security Bank, National Association, a
national banking association, as Escrow Agent (in such capacity, together
with its successors in such capacity, the "Escrow Agent"), Credit Suisse
First Boston Corporation, Deutsche Bank Securities Inc., Donaldson, Lufkin
& Jenrette Securities Corporation, Goldman, Sachs & Co., and Salomon Smith
Barney Inc., as Underwriters, State Street Bank and Trust Company of
Connecticut, National Association, as Pass Through Trustee (in such
capacity, together with its successors in such capacity, the "Pass Through
Trustee") and State Street Bank and Trust Company of Connecticut, National
Association as paying agent (in such capacity, together with its successors
in such capacity, the "Paying Agent"). Capitalized terms not defined herein
shall have the meanings assigned to them in the Escrow and Paying Agent
Agreement.
This Escrow Receipt is issued under and is subject to the
terms, provisions and conditions of the Escrow and Paying Agent Agreement.
By virtue of its acceptance hereof the holder of this Escrow Receipt
assents and agrees to be bound by the provisions of the Escrow and Paying
Agent Agreement and this Escrow Receipt.
This Escrow Receipt represents a fractional undivided
interest in amounts deposited from time to time in the Paying Agent
Account, and grants or represents no rights, benefits or interests of any
kind in respect of any assets or property other than such amounts. This
Escrow Receipt evidences the same percentage interest in the Account
Amounts as the Fractional Undivided Interest in the Pass Through Trust
evidenced by the Certificate to which this Escrow Receipt is affixed.
All payments and distributions made to Receiptholders in
respect of the Escrow Receipt shall be made only from Account Amounts
deposited in the Paying Agent Account. The holder of this Escrow Receipt,
by its acceptance of this Escrow Receipt, agrees that it will look solely
to the Account Amounts for any payment or distribution due to it pursuant
to this Escrow Receipt and that it will not have any recourse to US
Airways, the Pass Through Trustee, the Paying Agent or the Escrow Agent,
except as expressly provided herein, in the Escrow and Paying Agent
Agreement or in the Pass Through Trust Agreement. No Receiptholder of this
Escrow Receipt shall have any right to vote or in any manner otherwise
control the operation and management of the Paying Agent Account, nor shall
anything set forth herein, or contained in the terms of this Escrow
Receipt, be construed so as to constitute the Receiptholders from time to
time as partners or members of an association.
This Escrow Receipt may not be assigned or transferred
except in connection with the assignment or transfer of the Certificate to
which this Escrow Receipt is affixed. After payment to the holder hereof of
its Escrow Interest in the Final Distribution, upon the request of the Pass
Through Trustee, the holder hereof will return this Escrow Receipt to the
Pass Through Trustee.
The Paying Agent may treat the person in whose name the
Certificate to which this Escrow Receipt is attached as the owner hereof
for all purposes, and the Paying Agent shall not be affected by any notice
to the contrary.
THIS ESCROW RECEIPT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Escrow Agent has caused this Escrow
Receipt to be duly executed.
Dated: August 31, 1999
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
as Escrow Agent
By ______________________________________
Name:
Title:
EXHIBIT B
Withdrawal Certificate
(Class B)
First Security Bank, National Association,
as Escrow Agent
79 South Main Street
Salt Lake City, UT 84111
Attention: Corporate Trust Services
Telecopier: (801) 246-5053
Ladies and Gentlemen:
Reference is made to the Escrow and Paying Agent Agreement, dated as of
August 31, 1999, 1999 (the "Agreement"). We hereby certify to you that the
conditions to the obligations of the undersigned to execute a Participation
Agreement pursuant to the Note Purchase Agreement have been satisfied.
Pursuant to Section 1.2(c) of the Agreement, please execute the attached
Notice of Withdrawal and immediately transmit by facsimile to the
Depositary, at [ ].
Very truly yours,
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its
individual capacity but solely as
Pass Through Trustee
By ________________________________
Name:
Title:
Dated: __________, ___
NOTICE OF PURCHASE WITHDRAWAL
ABN AMRO BANK N.V.
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Lukas Van der Hoef
Telecopier: (312) 606-8428
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class B) dated
as of August 31, 1999 (the "Deposit Agreement") between First Security
Bank, National Association, as Escrow Agent, and ABN AMRO BANK, N.V.,
Chicago Branch, as Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit Agreement,
the undersigned hereby requests the withdrawal of the entire amount of the
Deposit, $__________, Account No. __________.
The undersigned hereby directs the Depositary to pay the
proceeds of the Deposit to _______________, Account No. __________,
Reference: __________ on _______________, _____, upon the telephonic
request of a representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
By_____________________________
Name:
Title:
Dated:___________, ____
- -----------------------------------------------------------------------------
Exhibit 4(a)(xii)
NOTE PURCHASE AGREEMENT
Dated as of August 31, 1999
Among
US AIRWAYS, INC.,
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
as Pass Through Trustee under each of the
Pass Through Trust Agreements
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
as Subordination Agent
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
as Escrow Agent
and
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
as Paying Agent
INDEX TO NOTE PURCHASE AGREEMENT
Page
SECTION 1. Definitions...............................................3
SECTION 2. Financing of New Aircraft.................................3
SECTION 3. Conditions Precedent......................................8
SECTION 4. Representations and Warranties............................9
SECTION 5. Covenants................................................14
SECTION 6. Notices..................................................15
SECTION 7. Expenses.................................................15
SECTION 8. Further Assurances.......................................16
SECTION 9. Miscellaneous............................................16
SECTION 10. Governing Law............................................17
SCHEDULES
Schedule I New Aircraft and Scheduled Closing Months
Schedule II Trust Supplements
Schedule III Deposit Agreements
Schedule IV Escrow and Paying Agent Agreements
Schedule V Mandatory Document Terms
Schedule VI Mandatory Economic Terms
Schedule VII Aggregate Amortization Schedule
ANNEX
Annex A Definitions
EXHIBITS
Exhibit A-1 Form of Leased Aircraft Participation Agreement
Exhibit A-2-1 Form of Basic Lease
Exhibit A-2-2 Form of Deferred Equity/Prepaid-Deferred Rent Lease
Exhibit A-3 Form of Leased Aircraft Indenture
Exhibit A-4 Form of Leased Aircraft Purchase Agreement Assignment
Exhibit A-5 Form of Leased Aircraft Trust Agreement
Exhibit A-6 Form of Leased Aircraft French Pledge Agreement
Exhibit B Form of Closing Notice
Exhibit C-1 Form of Owned Aircraft Participation Agreement
Exhibit C-2 Form of Owned Aircraft Indenture
Exhibit C-3 Form of Owned Aircraft Purchase Agreement Assignment
Exhibit C-4 Form of Owned Aircraft French Pledge Agreement
NOTE PURCHASE AGREEMENT
This NOTE PURCHASE AGREEMENT, dated as of August 31,
1999, among (i) US Airways, Inc., a Delaware corporation (the "Company"),
(ii) State Street Bank and Trust Company of Connecticut, National
Association, a national banking association, not in its individual capacity
except as otherwise expressly provided herein, but solely as trustee (in
such capacity together with its successors in such capacity, the "Pass
Through Trustee") under each of the three separate Pass Through Trust
Agreements (as defined below), (iii) State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, as
subordination agent and trustee (in such capacity together with its
successors in such capacity, the "Subordination Agent") under the
Intercreditor Agreement (as defined below), (iv) First Security Bank,
National Association, a national banking association, as Escrow Agent (in
such capacity together with its successors in such capacity, the "Escrow
Agent"), under each of the Escrow and Paying Agent Agreements (as defined
below) and (v) State Street Bank and Trust Company of Connecticut, National
Association, a national banking association, as Paying Agent (in such
capacity together with its successors in such capacity, the "Paying Agent")
under each of the Escrow and Paying Agent Agreements.
W I T N E S S E T H:
WHEREAS, US Airways Group, Inc. ("Group") has obtained
commitments from the Seller pursuant to the Aircraft Purchase Agreement for
the delivery of the twenty (20) aircraft listed in Schedule I hereto
(together with any aircraft substituted therefor in accordance with the
Aircraft Purchase Agreement prior to the
delivery thereof, the "New Aircraft");
WHEREAS, pursuant to the Basic Pass Through Trust
Agreement and each of the Trust Supplements set forth in Schedule II
hereto, and concurrently with the execution and delivery of this Agreement,
separate grantor trusts (collectively, the "Pass Through Trusts" and,
individually, a "Pass Through Trust") have been created to facilitate
certain of the transactions contemplated hereby, including, without
limitation, the issuance and sale of pass through certificates pursuant
thereto (collectively, the "Certificates") to provide for a portion of the
financing of the New Aircraft;
WHEREAS, the Company has entered into the Underwriting
Agreement dated as of August 24, 1999 (the "Underwriting Agreement") with
the several underwriters (the "Underwriters") named therein, which provides
that the Company will cause the Pass Through Trustee of each of the Class A
Trust and the Class B Trust to issue and sell the Class A Certificates and
the Class B Certificates to the Underwriters;
WHEREAS, the Company has entered into a Class C Trust
Certificate Purchase Agreement, dated as of August 31, 1999 (the "Class C
Purchase Agreement") with Airbus Industrie Financial Services ("AIFS")
which provides that the Company will cause the Trustee of the Class C Trust
to issue and sell Class C Certificates to AIFS;
WHEREAS, concurrently with the execution and delivery of
this Agreement, (i) the Escrow Agent and the Depositary entered into the
Deposit Agreements set forth in Schedule III hereto (the "Deposit
Agreements") whereby the applicable Escrow Agent agreed to direct the
Underwriters and AIFS to make certain deposits referred to therein on the
Issuance Date (the "Initial Deposits") and to permit the applicable Pass
Through Trustee to make additional deposits from time to time thereafter
(the Initial Deposits together with such additional deposits are
collectively referred to as the "Deposits") and (ii) the Pass Through
Trustees, the Underwriters, AIFS, the Paying Agents and the Escrow Agents
entered into the Escrow and Paying Agent Agreements set forth in Schedule
IV hereto (the "Escrow and Paying Agent Agreements") whereby, among other
things, (a) the Underwriters and AIFS agreed to deliver an amount equal to
the amount of the Initial Deposits to the applicable Depositary on behalf
of the applicable Escrow Agent and (b) the applicable Escrow Agent, upon
the applicable Depositary receiving such amount, has agreed to deliver
escrow receipts to be affixed to each Certificate;
WHEREAS, the Company will determine whether to enter into
a leveraged lease transaction as lessee with respect to such New Aircraft
(a "Leased Aircraft") or to issue secured equipment notes in order to
finance such New Aircraft (an "Owned Aircraft") and will give to the Pass
Through Trustee a Closing Notice (as defined below) specifying its election;
WHEREAS, upon receipt of a Closing Notice with respect to
a New Aircraft, subject to the terms and conditions of this Agreement, the
applicable Pass Through Trustees will enter into the applicable Financing
Agreements relating to such New Aircraft;
WHEREAS, on the Closing Date under the applicable
Financing Agreements, each Pass Through Trustee will fund its purchase of
Equipment Notes with the proceeds of one or more Deposits withdrawn by the
applicable Escrow Agent under the related Deposit Agreement bearing the
same interest rate as the Certificates issued by such Pass Through Trust; and
WHEREAS, concurrently with the execution and delivery of
this Agreement, (i) AIG Matched Funding Corp., a Delaware corporation (the
"Liquidity Provider"), has entered into three (3) revolving credit
agreements (each, a "Liquidity Facility"), one each for the benefit of the
Certificate Holders of each Pass Through Trust, with the Subordination
Agent, as agent for the Pass Through Trustee on behalf of each such Pass
Through Trust and (ii) the Pass Through Trustee, the Liquidity Provider and
the Subordination Agent have entered into the Intercreditor Agreement,
dated as of the date hereof (the "Intercreditor Agreement").
NOW, THEREFORE, in consideration of the foregoing
premises and the mutual agreements herein contained and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as
follows:
Section 1. Definitions. Capitalized terms used but not
defined herein shall have the respective meanings set forth or incorporated by
reference in Annex A.
Section 2. Financing of New Aircraft. (a) The Company
confirms that Group has entered into the Aircraft Purchase Agreement with
the Seller pursuant to which Group has agreed to purchase, and the Seller
has agreed to deliver, the New Aircraft in the months specified in Schedule
I hereto, all on and subject to terms and conditions specified in the
Aircraft Purchase Agreement. Group may, prior to the scheduled delivery
date for the New Aircraft, assign the right to purchase the New Aircraft to
the Company. The Company agrees that the New Aircraft will be financed in
the manner provided herein, all on and subject to the terms and conditions
hereof and of the relevant Financing Agreements.
(b) In furtherance of the foregoing, the Company
agrees to give the parties hereto, each Depositary and each of the Rating
Agencies not less than two (2) Business Day's prior notice (a "Closing Notice")
of the scheduled closing date (the "Scheduled Closing Date") (or, in the case
of a Substitute Closing Notice under Section 2(f) or (g) hereof, one (1)
Business Day's prior notice) of a financing in respect of each New
Aircraft, which notice shall:
(i) specify whether the Company has
elected to treat such New Aircraft as a Leased Aircraft or an
Owned Aircraft;
(ii) specify the Scheduled Closing
Date on which the financing therefor in the manner provided herein
shall be consummated, which Scheduled Closing Date shall be within
120 days of the delivery of such New Aircraft from the Seller to
the Company or Group (or, with Rating Agency Confirmation, a
longer period following delivery of such New Aircraft from Seller
to the Company or Group, but in no event on or after the Cut-Off
Date) and prior to the Cut-Off Date;
(iii) instruct the Pass Through
Trustees instruct each Escrow Agent to provide a Notice of
Purchase Withdrawal to the Depositary with respect to the
Equipment Notes to be issued in connection with the financing of
such New Aircraft;
(iv) instruct the Pass Through
Trustees enter into the Participation Agreement included in the
Financing Agreements with respect to such Aircraft in such form
and at such a time on or before the Scheduled Closing Date
specified in such Closing Notice and to perform its obligations
thereunder;
(v) specify the aggregate principal
amount of each series of Equipment Notes to be issued, and
purchased by the Pass Through Trustees, in connection with the
financing of such New Aircraft on such Scheduled Closing Date
(which shall in all respects comply with the Mandatory Economic
Terms); and
(vi) if such New Aircraft is to be
a Leased Aircraft, certify that the related Owner Participant (A)
is not an Affiliate of the Company and (B) based on the
representations of such Owner Participant, is either (1) a
Qualified Owner Participant or (2) any other person the
obligations of which under the Owner Participant Documents (as
defined in the applicable Participation Agreement) are guaranteed
by a Qualified Owner Participant.
Notwithstanding the foregoing, in the event the Scheduled Closing Date for
any Aircraft to be financed pursuant to the terms hereof is on or within 3
Business Days following the date of issuance of the Certificates, the
Closing Notice therefor may be delivered tothe parties hereto on such
Scheduled Closing Date.
(c) Upon receipt of a Closing Notice, the Pass
Through Trustees shall, and shall cause the Subordination Agent to, enter
into and perform their obligations under the Participation Agreement
specified in such Closing Notice, provided, however, that such
Participation Agreement and the other Financing Agreements to be entered
into pursuant to such Participation Agreement shall be in the forms thereof
annexed hereto in all material respects with such changes therein as shall
have been requested by the Company or the related Owner Participant (in the
case of Lease Financing Agreements), and agreed to by the Company and, if
modified in any material respect, as to which Rating Agency Confirmation
shall have been obtained from each Rating Agency by the Company (to be
delivered by the Company to the applicable Pass Through Trustee on or
before the relevant Closing Date, it being understood that if Rating Agency
Confirmation shall have been received with respect to any Financing
Agreements and such Financing Agreements are utilized for subsequent New
Aircraft (or Substitute Aircraft) without material modifications, no
additional Rating Agency Confirmation shall be required); provided,
however, that the relevant Financing Agreements as executed and delivered
shall not vary the Mandatory Economic Terms and shall contain the Mandatory
Document Terms (as such Mandatory Document Terms may be modified in
accordance with Schedule V hereto). Notwithstanding the foregoing, if any
Financing Agreement annexed hereto shall not have been reviewed by either
Rating Agency prior to the Issuance Date, then, prior to the use thereof in
connection with the financing of any Aircraft hereunder, the Company shall
obtain from each Rating Agency a confirmation that the use of such
Financing Agreement would not result in (A) a reduction of the rating for
any Class of Certificates below the then current rating for such Class of
Certificates or (B) a withdrawal or suspension of the rating of any Class
of Certificates.
(d) With respect to each New Aircraft, the
Company shall cause State Street Bank and Trust Company of Connecticut,
National Association (or such other person that meets the eligibility
requirements to act as loan trustee under the Leased Aircraft Indenture or
Owned Aircraft Indenture) to execute as Loan Trustee the Financing
Agreements relating to such Aircraft to which such Loan Trustee is intended
to be a party, and shall concurrently therewith execute such Financing
Agreements to which the Company is intended to be a party and perform its
respective obligations thereunder. Upon the request of either Rating
Agency, the Company shall deliver or cause to be delivered to each Rating
Agency a true and complete copy of each Financing Agreement relating to the
financing of each New Aircraft together with a true and complete set of the
closing documentation (including legal opinions) delivered to the related
Loan Trustee, Subordination Agent and Pass Through Trustee under the
related Participation Agreement.
(e) If after giving any Closing Notice, there
shall be a delay in the delivery of a New Aircraft, or if on the Scheduled
Closing Date of a New Aircraft the financing thereof in the manner
contemplated hereby shall not be consummated for whatever reason, the
Company shall give the parties hereto prompt notice thereof. Concurrently
with the giving of such notice of postponement or subsequently, the Company
shall give the parties hereto a substitute Closing Notice specifying the
date (the "Substitute Closing Date") to which the applicable financing
shall have been rescheduled (which shall be a Business Day before the
earlier of (x) the 120th day following the delivery of the Aircraft from
the Seller to the Company or Group, as the case may be (or, with Rating
Agency Confirmation, a longer period following delivery of such New
Aircraft from Seller to the Company or Group) and (y) the Cut-Off Date on
which the Escrow Agents shall be entitled to withdraw one or more Deposits
under each of the applicable Deposit Agreements to enable each applicable
Pass Through Trustee to fund its purchase of the related Equipment Notes).
Upon receipt of any such notice of postponement, each applicable Pass
Through Trustee shall comply with its obligations under Section 5.01 of
each of the Trust Supplements and thereafter the financing of the relevant
New Aircraft shall take place on the Substitute Closing Date therefor (all
on and subject to the terms and conditions of the relevant Financing
Agreements) unless further postponed as provided herein.
(f) Anything in this Section 2 to the contrary
notwithstanding, the Company shall have the right at any time on or before
the Scheduled Closing Date of any New Aircraft, and subsequent to its
giving a Closing Notice therefor, to postpone the Scheduled Closing Date of
such New Aircraft so as to enable the Company to change its election to
treat such New Aircraft as a Leased Aircraft or an Owned Aircraft by
written notice of such postponement to the other parties hereto. The
Company shall subsequently give the parties hereto a substitute Closing
Notice complying with the provisions of Section 2(b) hereof and specifying
the new Closing Date for such postponed New Aircraft (which shall be a
Business Day occurring before the earlier of (x) the 120th day following
the delivery of the Aircraft from the Seller to the Company or Group, as
the case may be (or, with Rating Agency Confirmation, a longer period
following delivery of such New Aircraft from Seller to the Company or
Group) and (y) the Cut-Off Date and on which the Escrow Agents shall be
entitled to withdraw Deposits under each of the applicable Deposit
Agreements sufficient to enable each applicable Pass Through Trustee to
fund its purchase of the related Equipment Notes). All other terms and
conditions of this Note Purchase Agreement shall apply to the financing of
any such New Aircraft on the re-scheduled Closing Date therefor except the
re-scheduled Closing Date shall be deemed the Closing Date of such New
Aircraft for all purposes of this Section 2.
(g) If the delivery date for any New Aircraft
under the Aircraft Purchase Agreement is delayed for more than 30 days
beyond the month scheduled for delivery or until on or after the Cut-Off
Date, the Company may identify for delivery a substitute aircraft therefor
meeting the following conditions (together with the substitute aircraft
referred to in the next sentence, a "Substitute Aircraft"): (i) a
Substitute Aircraft must be an Airbus Model A319, A320 or A330 aircraft
delivered by the Seller to the Company after the date of this Agreement,
(ii) the Substitute Aircraft must have been delivered after August 30, 1999
and (iii) the Company shall be obligated to obtain Rating Agency
Confirmation in respect of the replacement of any New Aircraft by
Substitute Aircraft. Upon the satisfaction of the conditions set forth
above with respect to a Substitute Aircraft, the New Aircraft to be
replaced shall cease to be subject to this Agreement and all rights and
obligations of the parties hereto concerning such New Aircraft shall cease,
and such Substitute Aircraft shall become and thereafter be subject to the
terms and conditions of this Agreement to the same extent as such New
Aircraft.
(h) The Company shall have no liability for the
failure of the Pass Through Trustees to purchase Equipment Notes with
respect to any New Aircraft or Substitute Aircraft, other than the
Company's obligation, if any, to pay the Deposit Make-Whole Amount pursuant
to Section 5(a)(i) of this Agreement.
(i) The parties agree that if, in connection
with the delivery of a New Aircraft or Substitute Aircraft, any Owner
Participant who is to be a party to any Lease Financing Agreements shall
not be a "citizen of the United States" within the meaning of Section
40102(a)(15) of the Act, then the applicable Lease Financing Agreements
shall be modified, consistent with the Mandatory Document Terms (as such
Mandatory Document Terms may be modified in accordance with Schedule V
hereto), to require such Owner Participant to enter into a voting trust,
voting powers or similar arrangement satisfactory to the Company that (A)
enables such New Aircraft or Substitute Aircraft to be registered in the
United States and (B) complies with the FAA regulations issued under the
Act applicable thereto.
(j) Anything herein to the contrary
notwithstanding, the Company shall not have the right, and shall not be
entitled, at any time to request the issuance of Equipment Notes of any
series to any Pass Through Trustee in an aggregate principal amount in
excess of the amount of the Deposits then available for withdrawal by the
Escrow Agent under and in accordance with the provisions of the related
Deposit Agreement.
(k) Anything herein to the contrary
notwithstanding, the Company and Group shall each have the right to accept
delivery of a New Aircraft under the Aircraft Purchase Agreement on the
delivery date therefor under the Aircraft Purchase Agreement (and in
connection therewith may utilize a bridge financing of such New Aircraft);
provided that the Company shall in any event, give the parties hereto a
Closing Notice specifying a Scheduled Closing Date not later than one
hundred twenty (120) days after the delivery of such New Aircraft under the
Aircraft Purchase Agreement (or, with Rating Agency Confirmation, a longer
period following delivery of such New Aircraft from Seller to the Company
or Group) and before the Cut-Off Date and otherwise complying with the
provisions of Section 2(b) hereof. All other terms and conditions of this
Note Purchase Agreement shall apply to the financing of any such New
Aircraft on the new Scheduled Closing Date therefor except (i) the
Scheduled Closing Date shall be deemed to be the Closing Date of such New
Aircraft for all purposes of this Section 2 and (ii) the related Financing
Agreements shall be amended to reflect the original delivery of such New
Aircraft to the Company.
Section 3. Conditions Precedent. The obligation of the
Pass Through Trustees to enter into, and to cause the Subordination Agent
to enter into, any Participation Agreement as directed pursuant to a
Closing Notice and to perform its obligations under such Participation
Agreement is subject to satisfaction of the following conditions:
(a) no Triggering Event shall have occurred;
(b) the Company shall have delivered a
certificate to each such Pass Through Trustee and each Liquidity Provider
stating that (i) such Participation Agreement and the other Financing
Agreements to be entered into pursuant to such Participation Agreement do
not vary the Mandatory Economic Terms and contain the Mandatory Document
Terms (as such Mandatory Document Terms may be modified in accordance with
Schedule V hereto) and (ii) any substantive modification of such Financing
Agreements from the forms thereof attached to this Agreement do not
materially and adversely affect the Certificate Holders, and such
certification shall be true and correct;
(c) if required by Section 2(c), Rating Agency
Confirmation from each Rating Agency; and
(d) in the case of the Class C Trust, on any
Closing Date that occurs at a time when AIFS is the record or beneficial
owner of any Class C Certificate, the Class C Trustee shall have received a
certificate signed by the Chief Financial Officer, Treasurer or Assistant
Treasurer of the Company, to the effect that (i) all of the conditions
precedent set forth in Section 6 the Aircraft Financing Letter Agreement
have been satisfied, (ii) no "Termination Event" has occurred under Section
7 of the Aircraft Financing Letter Agreement and (iii) the terms and
conditions of such Participation Agreement and the related Operative
Documents comply with the provisions of Section 13 of the Purchase
Agreement.
Anything herein to the contrary notwithstanding, the
obligation of each Pass Through Trustee to purchase Equipment Notes shall
terminate on the Cut-Off Date. In addition, the obligation of the Pass
Through Trustee of the Class C Trust to purchase Equipment Notes shall
terminate on the date on which a "Termination Event" under the Aircraft
Financing Letter Agreement occurs, if on such date AIFS is the record or
beneficial owner of any Class C Trust Certificate.
Section 4. Representations and Warranties.
(a) The Company represents and warrants on the
date hereof and on each Closing Date that:
(i) the Company is duly
incorporated, validly existing and in good standing under the laws
of the State of Delaware and is a "citizen of the United States"
as defined in Section 40102(a)(15) of the Act and has the full
corporate power, authority and legal right under the laws of the
State of Delaware to execute and deliver this Agreement and each
Financing Agreement to which it will be a party and to carry out
the obligations of the Company under this Agreement and each
Financing Agreement to which it will be a party;
(ii) the execution and delivery by
the Company of this Agreement and the performance by the Company
of its obligations under this Agreement have been duly authorized
by the Company and will not violate its Certificate of
Incorporation or by-laws or the provisions of any indenture,
mortgage, contract or other agreement to which it is a party or by
which it is bound;
(iii) this Agreement constitutes the
legal, valid and binding obligation of the Company, enforceable
against it in accordance with its terms, except as the same may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of creditors
generally and by general principles of equity, whether considered
in a proceeding at law or in equity; and
(iv) if a certificate is required to
be delivered under Section 3(d), the statements contained therein
are true and correct.
(b) State Street Bank and Trust Company of
Connecticut, National Association represents and warrants on the date
hereof and on each Closing Date that:
(i) State Street Bank and Trust
Company of Connecticut, National Association is duly incorporated,
validly existing and in good standing under the laws of the State
of Connecticut and is a "citizen of the United States" as defined
in Section 40102(a)(15) of the Act, and has the full corporate
power, authority and legal right under the laws of the State of
Connecticut and the United States pertaining to its banking, trust
and fiduciary powers to execute and deliver this Agreement and
each Financing Agreement to which it will be a party and to carry
out the obligations of State Street Bank and Trust Company of
Connecticut, National Association, in its capacity as
Subordination Agent, Pass Through Trustee or Paying Agent, as the
case may be, under this Agreement and each Financing Agreement to
which it will be a party;
(ii) the execution and delivery by
State Street Bank and Trust Company of Connecticut, National
Association, in its capacity as Subordination Agent, Pass Through
Trustee or Paying Agent, as the case may be, of this Agreement and
the performance by State Street Bank and Trust Company of
Connecticut, National Association, in its capacity as
Subordination Agent, Pass Through Trustee or Paying Agent, as the
case may be, of its obligations under this Agreement have been
duly authorized by State Street Bank and Trust Company of
Connecticut, National Association, in its capacity as
Subordination Agent, Pass Through Trustee or Paying Agent, as the
case may be, and will not violate its articles of association or
by-laws or the provisions of any indenture, mortgage, contract or
other agreement to which it is a party or by which it is bound;
and
(iii) this Agreement constitutes the
legal, valid and binding obligation of State Street Bank and Trust
Company of Connecticut, National Association, in its capacity as
Subordination Agent, Pass Through Trustee or Paying Agent, as the
case may be, enforceable against it in accordance with its terms,
except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the rights of creditors generally and by general principles of
equity, whether considered in a proceeding at law or in equity.
(c) The Pass Through Trustee hereby confirms to
each of the other parties hereto that its representations and warranties
set forth in Section 7.15 of the Basic Pass Through Trust Agreement and
Section 5.04 of each Trust Supplement are true and correct as of the date
hereof.
(d) The Subordination Agent represents and
warrants that:
(i) the Subordination Agent is duly
organized, validly existing and in good standing under the laws of
the United States and has the full corporate power, authority and
legal right under the laws of the State of Connecticut and the
United States pertaining to its banking, trust and fiduciary
powers to execute and deliver this Agreement and each Financing
Agreement to which it is or will be a party and to perform its
obligations under this Agreement and each Financing Agreement to
which it is or will be a party;
(ii) this Agreement has been duly
authorized, executed and delivered by the Subordination Agent;
this Agreement constitutes the legal, valid and binding
obligations of the Subordination Agent enforceable against it in
accordance with its terms, except as the same may be limited by
applicable bankruptcy, insolvency reorganization, moratorium or
similar laws affecting the rights of creditors generally and by
general principles of equity, whether considered in a proceeding
at law or in equity;
(iii) none of the execution,
delivery and performance by the Subordination Agent of this
Agreement contravenes any law, rule or regulation of the State of
Connecticut or any United States governmental authority or agency
regulating the Subordination Agent's banking, trust or fiduciary
powers or any judgment or order applicable to or binding on the
Subordination Agent and do not contravene the Subordination
Agent's articles of association or by-laws or result in any breach
of, or constitute a default under, any agreement or instrument to
which the Subordination Agent is a party or by which it or any of
its properties may be bound;
(iv) neither the execution and
delivery by the Subordination Agent of this Agreement nor the
consummation by the Subordination Agent of any of the transactions
contemplated hereby requires the consent or approval of, the
giving of notice to, the registration with, or the taking of any
other action with respect to, any Connecticut governmental
authority or agency or any federal governmental authority or
agency regulating the Subordination Agent's banking, trust or
fiduciary powers;
(v) there are no Taxes payable by
the Subordination Agent imposed by the State of Connecticut or any
political subdivision or taxing authority thereof in connection
with the execution, delivery and performance by the Subordination
Agent of this Agreement (other than franchise or other taxes based
on or measured by any fees or compensation received by the
Subordination Agent for services rendered in connection with the
transactions contemplated by the Intercreditor Agreement or any of
the Liquidity Facilities), and there are no Taxes payable by the
Subordination Agent imposed by the United States or the State of
Connecticut or any political subdivision of either in connection
with the acquisition, possession or ownership by the Subordination
Agent of any of the Equipment Notes (other than franchise or other
taxes based on or measured by any fees or compensation received by
the Subordination Agent for services rendered in connection with
the transactions contemplated by the Intercreditor Agreement or
any of the Liquidity Facilities); and
(vi) there are no pending or
threatened actions or proceedings against the Subordination Agent
before any court or administrative agency which individually or in
the aggregate, if determined adversely to it, would materially
adversely affect the ability of the Subordination Agent to perform
its obligations under this Agreement.
(e) The Escrow Agent represents and warrants that:
(i) the Escrow Agent is a national
banking association duly incorporated, validly existing and in
good standing under the laws of the United States and has the full
corporate power, authority and legal right under the laws of the
United States pertaining to its banking, trust and fiduciary
powers to execute and deliver this Agreement, each Deposit
Agreement and each Escrow and Paying Agent Agreement
(collectively, the "Escrow Agent Agreements") and to carry out the
obligations of the Escrow Agent under each of the Escrow Agent
Agreements;
(ii) the execution and delivery by
the Escrow Agent of each of the Escrow Agent Agreements and the
performance by the Escrow Agent of its obligations hereunder and
thereunder have been duly authorized by the Escrow Agent and will
not violate its articles of association or by-laws or the
provisions of any indenture, mortgage, contract or other agreement
to which it is a party or by which it is bound; and
(iii) each of the Escrow Agent
Agreements constitutes the legal, valid and binding obligations of
the Escrow Agent enforceable against it in accordance with its
terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the rights of creditors generally and by general principles of
equity, whether considered in a proceeding at law or in equity.
(f) The Paying Agent represents and warrants that:
(i) the Paying Agent is duly
organized, incorporated, validly existing and in good standing
under the laws of the United States and has the full corporate
power, authority and legal right under the laws of the United
States pertaining to its banking, trust and fiduciary powers to
execute and deliver this Agreement and each Escrow and Paying
Agent Agreement (collectively, the "Paying Agent Agreements") and
to carry out the obligations of the Paying Agent under each of the
Paying Agent Agreements;
(ii) the execution and delivery by
the Paying Agent of each of the Paying Agent Agreements and the
performance by the Paying Agent of its obligations hereunder and
thereunder have been duly authorized by the Paying Agent and will
not violate its articles of association or by-laws or the
provisions of any indenture, mortgage, contract or other agreement
to which it is a party or by which it is bound; and
(iii) each of the Paying Agent
Agreements constitutes the legal, valid and binding obligations of
the Paying Agent enforceable against it in accordance with its
terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the rights of creditors generally and by general principles of
equity, whether considered in a proceeding at law or in equity.
Section 5. Covenants. (a) The Company covenants with each
of the other parties hereto that:
(i) on the date that the Depositary
is obligated to pay the amount of the Final Withdrawal to the
Paying Agent pursuant to a Deposit Agreement relating to any
Trust, the Company shall pay to the Pass Through Trustee of such
Trust no later than 1:00 p.m. (New York time) an amount equal to
the Deposit Make-Whole Premium, if any, required to be paid in
respect of such Final Withdrawal amount;
(ii) subject to Section 5(a)(iv) of
this Agreement, the Company shall at all times maintain its
corporate existence and shall not wind up, liquidate or dissolve
or take any action, or fail to take any action, that would have
the effect of any of the foregoing;
(iii) the Company shall at all times
remain a U.S. Air Carrier (as defined in the Financing Agreements)
and shall at all times be otherwise certificated and registered to
the extent necessary to entitle (i) in the case of Leased
Aircraft, the Owner Trustee (and the Loan Trustee as assignee of
the Owner Trustee's rights under each Lease) to the rights
afforded to lessors of aircraft equipment under Section 1110 and
(ii) in the case of Owned Aircraft, the Loan Trustee to the rights
afforded to secured parties of aircraft equipment under Section
1110;
(iv) Section 7(v) of each
Participation Agreement is hereby incorporated by reference
herein;
(v) on any date the Company is
obligated to pay to the Pass Through Trustee on behalf of the
Class C Trust a Class C Special Indemnity Payment pursuant to the
Participation Agreement, the Company shall pay to the Pass Through
Trustee on behalf of the Class C Trust the amount which has
accrued during such Lease Period (as defined in the Participation
Agreement) in accordance with the following sentence and which
remains unpaid on such date (such amount, the "Class C Special
Deposit Payment"). The Class C Special Deposit Payment shall
accrue during the period between each Regular Distribution Date at
a daily rate equal to the Multiplier, in effect from time to time
during such period, multiplied by the aggregate principal amount
of the Deposit on such date divided by 360. The Pass Through
Trustee agrees that it will accept and receive the Class C Special
Deposit Payment on behalf of the Class C Trust and that it will
distribute the Class C Special Deposit Payment in accordance with
the Class C Trust;
(vi) the Company agrees to provide
written notice to each of the parties hereto of the occurrence of
the Cut-Off Date no later than one Business Day after the date
thereof; and
(vii) with respect to Owned
Aircraft, the Company agrees to provide each Rating Agency with
prompt written notice of any lease by the Company of any Aircraft
for a lease period of more than one (1) year.
(b) State Street Bank and Trust Company of
Connecticut, National Association, in its individual capacity, covenants
with each of the other parties to this Agreement that it will, immediately
upon obtaining knowledge of any facts that would cast doubt upon its
continuing status as a "citizen of the United States" as defined in 49
U.S.C. ss. 40102(a)(15) and promptly upon public disclosure of negotiations
in respect of any transaction which would or might adversely affect such
status, notify in writing all parties hereto of all relevant matters in
connection therewith. Upon State Street Bank and Trust Company of
Connecticut, National Association giving any such notice, State Street Bank
and Trust Company of Connecticut, National Association shall, subject to
Section 8.02 of any Indenture then entered into, resign as Loan Trustee in
respect of such Indenture.
Section 6. Notices. Unless otherwise specifically
provided herein, all notices required or permitted by the terms of this
Agreement shall be in English and in writing, and any such notice shall
become effective upon being delivered personally or, if promptly confirmed
by mail, when dispatched by facsimile or other written telecommunication,
addressed to such party hereto at its address or facsimile number set forth
below the signature of such party at the foot of this Agreement.
Section 7. Expenses and Indemnity. (a) The Company agrees
to pay to the Subordination Agent when due an amount or amounts equal to
the fees payable to the Liquidity Provider under Section 2.03 of each
Liquidity Facility and the related Fee Letter (as defined in the
Intercreditor Agreement) multiplied by a fraction the numerator of which
shall be the then outstanding aggregate amount of the Deposits under the
Deposit Agreements and the denominator of which shall be the sum of (x) the
then outstanding aggregate principal amount of the Series A Equipment
Notes, Series B Equipment Notes and Series C Equipment Notes issued under
all of the Indentures and (y) the then outstanding aggregate amount of the
Deposits under the Deposit Agreements.
(b) So long as no Equipment Notes have been
issued in respect of any Aircraft, the Company agrees to pay (i) to the
Subordination Agent when due (A) the amount equal to interest on any
Downgrade Advance (other than any Applied Downgrade Advance) payable under
Section 3.07 of each Liquidity Facility minus Investment Earnings while
such Downgrade Advance shall be outstanding, (B) the amount equal to
interest on any Non-Extension Advance (other than any Applied Non-Extension
Advance) payable under Section 3.07 of each Liquidity Facility minus
Investment Earnings while such Non-Extension Advance shall be outstanding
and (C) any other amounts owed to the Liquidity Provider by the
Subordination Agent as borrower under each Liquidity Facility (other than
amounts due as repayment of advances thereunder or as interest on such
advances, except to the extent payable pursuant to clause (A) or (B)), (ii)
all compensation and reimbursement of expenses, disbursements and advances
payable by the Company under the Pass Through Trust Agreements, (iii) all
compensation and reimbursement of expenses and disbursements payable to the
Subordination Agent under the Intercreditor Agreement except with respect
to any income or franchise taxes incurred by the Subordination Agent in
connection with the transactions contemplated by the Intercreditor
Agreement and (iv) in the event the Company requests any amendment to any
Operative Document, all reasonable fees and expenses (including, without
limitation, fees and disbursements of counsel) of the Escrow Agent and/or
the Paying Agent in connection therewith. For purposes of this Section
7(b), the terms "Applied Downgrade Advance," "Applied Non-Extension
Advance," "Downgrade Advance", "Investment Earnings" and "Non-Extension
Advance" shall have the meanings specified in each Liquidity Facility.
(c) The Company hereby agrees to indemnify each
of the Escrow Agent and the Paying Agent from and against, and agrees to
protect, save and keep harmless each of them from any and all losses,
claims and expenses imposed on, incurred by or asserted against any of them
in any way relating to, based on or arising from the execution, delivery
and performance of this Agreement, the Deposit Agreements or the Escrow and
Paying Agent Agreements; provided, that the foregoing indemnity shall not
extend to any of the Escrow Agent or the Paying Agent with respect to any
loss, claim or expense to the extent such loss, claim or expense is
attributable to (i) a breach by any such party of this Agreement, the
Deposit Agreements or the Escrow and Paying Agent Agreements or (ii) such
party's gross negligence or wilfull misconduct.
Section 8. Further Assurances. Each party hereto shall
duly execute, acknowledge and deliver, or shall cause to be executed,
acknowledged and delivered, all such further agreements, instruments,
certificates or documents, and shall do and cause to be done such further
acts and things, in any case, as any other party hereto shall reasonably
request in connection with its administration of, or to carry out more
effectually the purposes of, or to better assure and confirm unto it the
rights and benefits to be provided under, this Agreement.
Section 9. Miscellaneous. (a) Provided that the
transactions contemplated hereby have been consummated, and except as
otherwise provided for herein, the representations, warranties and
agreements herein of the Company, the Subordination Agent, the Escrow
Agent, the Paying Agent and the Pass Through Trustee, and the Company's,
the Subordination Agent's, the Escrow Agent's, the Paying Agent's and the
Pass Through Trustee's obligations under any and all thereof, shall survive
the expiration or other termination of this Agreement and the other
agreements referred to herein.
(b) This Agreement may be executed in any number
of counterparts (and each of the parties hereto shall not be required to
execute the same counterpart). Each counterpart of this Agreement,
including a signature page executed by each of the parties hereto, shall be
an original counterpart of this Agreement, but all of such counterparts
together shall constitute one instrument. Neither this Agreement nor any of
the terms hereof may be terminated, amended, supplemented, waived or
modified orally, but only by an instrument in writing signed by the party
against which the enforcement of the termination, amendment, supplement,
waiver or modification is sought. The index preceding this Agreement and
the headings of the various Sections of this Agreement are for convenience
of reference only and shall not modify, define, expand or limit any of the
terms or provisions hereof. The terms of this Agreement shall be binding
upon, and shall inure to the benefit of, the Company and its successors and
permitted assigns, the Pass Through Trustee and its successors as Pass
Through Trustee (and any additional trustee appointed) under any of the
Pass Through Trust Agreements, the Escrow Agent and its successors as
Escrow Agent under the Escrow and Paying Agent Agreements, the Paying Agent
and its successors as Paying Agent under the Escrow and Paying Agent
Agreement and the Subordination Agent and its successors as Subordination
Agent under the Intercreditor Agreement.
(c) This Agreement is not intended to, and shall
not, provide any person not a party hereto (other than the Underwriters,
AIFS and each of the beneficiaries of Section 7 hereof) with any rights of
any nature whatsoever against any of the parties hereto, and no person not
a party hereto (other than the Underwriters, AIFS and each of the
beneficiaries of Section 7 hereof) shall have any right, power or privilege
in respect of, or have any benefit or interest arising out of, this
Agreement.
Section 10. Governing Law. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
[This space intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have caused this
Note Purchase Agreement to be duly executed by their respective officers
thereunto duly authorized as of the day and year first above written.
US AIRWAYS, INC.
By:/s/ Jeffery A. McDougle
_______________________________
Name: Jeffery A. McDougle
Title: Vice President and Treasurer
Address: 2345 Crystal Drive, Arlington, VA
22227
Attention: Treasurer
Facsimile: (703) 872-5936
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, not in its
individual capacity, except as otherwise
provided herein, but solely as Pass Through
Trustee
By:/s/ Julie A. Balerna
_______________________________
Name: Julie A. Balerna
Title: Assistant Vice President
Address: 225 Asylum Street Goodwin Square
Hartford, CN 06103
Attention: Corporate Trust Administration
Facsimile: (860) 244-1889
with a copy to:
State Street Bank and
Trust Company 2 Avenue de
Lafayette, 6th Floor Boston, MA
02111
Attention: Corporate Trust Department
Facsimile: (617)662-1461
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, not in its
individual capacity, except as otherwise
provided herein, but solely as Subordination
Agent
By:/s/ Julie A. Balerna
__________________________________
Name: Julie A. Balerna
Title: Assistant Vice President
Address: 225 Asylum Street
Goodwin Square
Hartford, CN 06103
Attention: Corporate Trust Administration
Facsimile: (860) 244-1889
with a copy to:
State Street Bank and Trust Company
2 Avenue de Lafayette, 6th Floor
Boston, MA 02111
Attention: Corporate Trust Department
Facsimile: (617) 664-1461
FIRST SECURITY BANK, NATIONAL ASSOCIATION, as
Escrow Agent
By:/s/ Brett R. King
___________________________________
Name: Brett R. King
Title: Vice President
Address: 79 South Main Street
Salt Lake City, UT 84111
Attention: Corporate Trust Department
Facsimile: (801) 246-5053
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, as Paying
Agent
By:/s/ Julie A. Balerna
___________________________________
Name: Julie A. Balerna
Title: Assistant Vice President
Address: 225 Asylum Street
Goodwin Square
Hartford, CN 06103
Attention: Corporate Trust Administration
Facsimile: (860) 244-1889
with a copy to:
State Street Bank and Trust Company
2 Avenue de Lafayette, 6th Floor
Boston, MA 02111
Attention: Corporate Trust Department
Facsimile: (617) 662-1461
SCHEDULE I to
NOTE PURCHASE AGREEMENT
NEW AIRCRAFT AND SCHEDULED CLOSING MONTHS
<TABLE>
<CAPTION>
New Aircraft Expected Manufacturer's Scheduled
Type Registration Number Serial Number Delivery Month
<S> <C> <C> <C> <C>
Airbus A320.............. N107US 1052 August, 1999
Airbus A320.............. N108UW 1061 August, 1999
Airbus A319.............. N717UW 1069 August, 1999
Airbus A319.............. N718UW 1077 August, 1999
Airbus A320.............. N109UW 1065 September, 1999
Airbus A319.............. N719US 1084 September, 1999
Airbus A319.............. N720US 1089 September, 1999
Airbus A319.............. N721UW 1095 October, 1999
Airbus A319.............. N722US 1097 October, 1999
Airbus A319.............. N723UW 1109 October, 1999
Airbus A320.............. N110UW 1112 November, 1999
Airbus A320.............. N111US 1114 November, 1999
Airbus A319.............. N724UW 1122 November, 1999
Airbus A319.............. N725UW 1135 November, 1999
Airbus A319.............. N726US 1136 December, 1999
Airbus A319.............. N727UW 1147 December, 1999
Airbus A319.............. N728UW 1169 January, 2000
Airbus A319.............. N729US 1178 February, 2000
Airbus A330.............. N670UW 315 March, 2000
Airbus A330.............. N671UW 323 April, 2000
</TABLE>
SCHEDULE II to
NOTE PURCHASE AGREEMENT
TRUST SUPPLEMENTS
Trust Supplement dated as of the Issuance Date between
the Company and the Pass Through Trustee in respect of US Airways Pass
Through Trust, Series 1999-1A.
Trust Supplement dated as of the Issuance Date between
the Company and the Pass Through Trustee in respect of US Airways Pass
Through Trust, Series 1999-1B.
Trust Supplement dated as of the Issuance Date between
the Company and the Pass Through Trustee in respect of US Airways Pass
Through Trust, Series 1999-1C.
SCHEDULE III to
NOTE PURCHASE AGREEMENT
DEPOSIT AGREEMENTS
Deposit Agreement (Class A) dated as of the Issuance Date
between ABN AMRO Bank N.V., acting through its Chicago branch and the
Escrow Agent.
Deposit Agreement (Class B) dated as of the Issuance Date
between ABN AMRO Bank N.V., acting through its Chicago branch and the
Escrow Agent.
Deposit Agreement (Class C) dated as of the Issuance Date
between ABN AMRO Bank N.V., acting through its Chicago branch and the
Escrow Agent.
SCHEDULE IV to
NOTE PURCHASE AGREEMENT
ESCROW AND PAYING AGENT AGREEMENTS
Escrow and Paying Agent Agreement (Class A) dated as of
the Issuance Date among the Escrow Agent, the Underwriters, the Pass
Through Trustee and the Paying Agent.
Escrow and Paying Agent Agreement (Class B) dated as of
the Issuance Date among the Escrow Agent, the Underwriters, the Pass
Through Trustee and the Paying Agent.
Escrow and Paying Agent Agreement (Class C) dated as of
the Issuance Date among the Escrow Agent, AIFS, the Pass Through Trustee
and the Paying Agent.
SCHEDULE V to
NOTE PURCHASE AGREEMENT
MANDATORY DOCUMENT TERMS
The terms "Trust Indenture Form," "Lease Form" and
"Participation Agreement Form" shall have the respective meanings specified
in Schedule VI to the Note Purchase Agreement.
1. May not modify in any material adverse respect as
regards the interests of the Note Holders, the Subordination Agent, the
Liquidity Provider or the Loan Trustee, the Granting Clause of the Trust
Indenture Form so as to deprive the Note Holders of a first priority
security interest in and mortgage lien on the Aircraft, the rights of US
Airways under the Aircraft Purchase Agreement to the extent assigned under
the Indenture and in the case of a Leased Aircraft Indenture, the Lease or
to eliminate any of the obligations intended to be secured thereby or
otherwise modify in any material adverse respect as regards the interests
of the Note Holders, the Subordination Agent, the Liquidity Provider or the
Loan Trustee the provisions of Article II or III or Sections 4.02, 4.03,
4.04, 5.02, 5.06, 9.01, 10.04, 10.11 or 10.12 of the Trust Indenture Form
for the Leased Aircraft or Article II or III or Sections 4.02, 4.03, 4.04
5.02, 5.06, 10.01, 11.04, 11.11 or 11.12 of the Trust Indenture Form for
the Owned Aircraft.
2. May not modify in any material adverse respect as
regards the interests of the Note Holders, the Subordination Agent, the
Liquidity Provider or the Loan Trustee the provisions of Section 3(c)(v),
the proviso to the first sentence of Section 3(e), 7(a)(1)(A), clause (6)
of the final paragraph of Section 10(a), 18, 21, the penultimate sentence
of Section 25 or Section 27 of the Lease Form or otherwise modify the terms
of the Lease Form so as to deprive the Loan Trustee of rights expressly
granted to the "Loan Trustee" therein.
3. May not modify in any material adverse respect as
regards the interests of the Note Holders, the Subordination Agent, the
Liquidity Provider or the Loan Trustee the provisions of Sections 4(a)(vi),
4(a)(ix)(1), 4(a)(ix)(2), 4(a)(ix)(3), 4(a)(ix)(4) (but only to the extent
relating to the representations and warranties set forth in Sections
6(a)(vi) and 6(a)(xv)), Sections 4(a)(x), 4(a)(xi) (to the extent such
section requires special counsel for the Lessee to deliver an opinion
relating to Section 1110 of the Bankruptcy Code), 4(a)(xii), 4(a)(xiii),
4(a)(xv) and 4(a)(xvi) so as to eliminate the requirement to deliver to the
Loan Participant or the Loan Trustee, as the case may be, the legal
opinions to be provided to such Persons thereunder (recognizing that the
lawyers rendering such opinions may be changed), Sections 7(c), 7(h), the
second sentence of Section 7(n), 7(q), 7(z), 14(f) or 14(h) of the
Participation Agreement Form or of the provisions of Section 7(d)(II)(E) of
the Participation Agreement Form as regards the rights of the Loan Trustee
thereunder.
4. May not modify, in any material adverse respect as
regards the interests of the Note Holders, the Subordination Agent, the
Liquidity Provider or the Loan Trustee, the definition of "Make-Whole
Amount" in Annex A to the Participation Agreement Form.
Notwithstanding the foregoing, any such Mandatory
Document Term may be modified to correct or supplement any such provision
which may be defective or to cure any ambiguity or correct any mistake,
provided, however, that any such action shall not materially adversely
affect the interests of the Note Holders, the Subordination Agent, the
Liquidity Provider, the Loan Trustee or the Certificate Holders.
SCHEDULE VI to
NOTE PURCHASE AGREEMENT
MANDATORY ECONOMIC TERMS
PART I:
MANDATORY ECONOMIC TERMS OF THE EQUIPMENT NOTES
OBLIGOR: (i) in the case of Equipment Notes issued under an Owned Aircraft
Indenture, US Airways, Inc. or (ii) in the case of Equipment Notes issued
under a Leased Aircraft Indenture, an Owner Trust
MAXIMUM PRINCIPAL AMOUNT OF EQUIPMENT NOTES (ON AN AIRCRAFT-BY-AIRCRAFT
BASIS):
1. Series A Equipment Notes. The principal amount of the
Series A Equipment Notes issued with respect to an Aircraft must
equal the principal amount of Series A Equipment Notes indicated
for each such Aircraft as set forth in the Prospectus Supplement
in "Prospectus Supplement Summary-Secured Promissory Notes and the
Aircraft" under the column "Principal Amount of Series A Equipment
Notes."
2. Series B and Series C Equipment Notes. The maximum
principal amount of the Series B and Series C Equipment Notes
issued with respect to an Aircraft must not exceed the principal
amount of Series B and Series C Equipment Notes indicated for each
Aircraft as set forth in "Prospectus Supplement Summary-Secured
Promissory Notes and Aircraft" under the columns "Maximum
Principal Amount of Series B Secured Promissory Notes" and
"Maximum Principal Amount of Series C Secured Promissory Notes."
LOAN TO AIRCRAFT VALUE RATIO OF EQUIPMENT NOTES (ON AN AIRCRAFT-BY-AIRCRAFT
BASIS):
1. Initial Loan to Aircraft Value Ratio. Initial Loan to
Aircraft Value (with the value of any Aircraft for these purposes
equal to the value (the "Assumed Appraised Value") for such
Aircraft set forth in the Prospectus Supplement in "Prospectus
Supplement Summary-Secured Promissory Notes and the Aircraft"
under the column "Appraised Base Value") must not exceed the
percentages set forth in the following table:
<TABLE>
<CAPTION>
Series A Series B Series C
Aircraft Type Equipment Notes Equipment Notes Equipment Notes
-------------- -------------- --------------- ---------------
<S> <C> <C> <C> <C>
Airbus A319 40.89% 48.02% 62.92%
Airbus A320 41.74% 49.93% 65.73%
Airbus A330 38.89% 57.07% 61.70%
</TABLE>
2. Loan to Aircraft Value Ratios on Regular Distribution
Dates. The Loan to Aircraft Value for each series of Equipment
Notes issued in respect of each Aircraft (computed (i) after
aggregating the principal amount of all series of Equipment Notes
that ranks senior to the series of Equipment Notes for which Loan
to Aircraft Value is being calculated and (ii) as of the date of
the issuance thereof on the basis of the Assumed Appraised Value
of such Aircraft and the Depreciation Assumption (as defined in
the Prospectus Supplement in the Glossary) must not exceed as of
any Regular Distribution Date thereafter (assuming no default in
the payment of the Equipment Notes) the amounts set forth in the
following table:
<TABLE>
<CAPTION>
Series A Series B Series C
Aircraft Type Equipment Notes Equipment Notes Equipment Notes
------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Airbus A319 43.22% 48.96% 66.00%
Airbus A320 44.09% 49.93% 67.00%
Airbus A330 38.89% 57.07% 61.70%
</TABLE>
INITIAL AVERAGE LIFE OF EQUIPMENT NOTES (ON AN AIRCRAFT-BY-AIRCRAFT BASIS):
Initial Average Life (in years) of the Series A Equipment
Notes, the Series B Equipment Notes and the Series C Equipment Notes on any
Aircraft will not extend beyond 13.5 years, 10.5 years, and 13.5 years,
respectively, from the Issuance Date.
INTEREST RATE FOR EQUIPMENT NOTES (ON A TRUST-BY-TRUST BASIS):
The interest rate applicable to each Series of Equipment
Notes (the "Debt Rate") must be equal to the rate applicable to the
Certificates issued by the corresponding Trust. PAST DUE RATE APPLICABLE TO
EQUIPMENT NOTES: Not less than Debt Rate plus 1% per annum.
AGGREGATE PRINCIPAL AMOUNT OF EQUIPMENT NOTES (ON A TRUST-BY-TRUST BASIS):
The original aggregate principal amount of all of the
Equipment Notes of each Series shall not exceed the original aggregate face
amount of the Certificates issued by the corresponding Trust.
PAYMENT DATES APPLICABLE TO EQUIPMENT NOTES:
For Aircraft financed prior to January 20, 2000, payment
dates will be January 20 and July 20, commencing January 20, 2000. For
Aircraft financed on or after January 20, 2000, payment dates will be July
20 and January 20, commencing July
20, 2000.
MAKE-WHOLE AMOUNTS APPLICABLE TO EQUIPMENT NOTES:
As provided in Article II of the form of Leased Aircraft
Indenture marked as Exhibit A-3 of the Note Purchase Agreement (the "Leased
Aircraft Indenture Form") or the form of Owned Aircraft Indenture marked as
Exhibit C-2 of the Note Purchase Agreement (the "Owned Aircraft Indenture
Form," together with the Leased Aircraft Indenture Form, the "Trust
Indenture Form").
REDEMPTION AND PURCHASE OF EQUIPMENT NOTES: As provided in Article II of the
applicable Trust Indenture Form.
PART II:
MANDATORY ECONOMIC TERMS OF THE CERTIFICATES
AVERAGE LIFE (IN YEARS)
As of the Delivery Period Termination Date, the average
life of the Class A Certificates, the Class B Certificates and the Class C
Certificates, must not be more than 12.1 years, 9.6 years and 12.7 years,
respectively, from the Issuance Date (computed without regard to the
acceleration of any Equipment Notes and after giving effect to any special
distribution on the Certificates thereafter required in respect of unused
Deposits).
LOAN TO AIRCRAFT VALUE RATIO FOR CLASS OF CERTIFICATES
As of the Delivery Period Termination Date and each
Regular Distribution Date thereafter, the Loan to Aircraft Value for each
class of Certificates (computed (i) after aggregating the principal amount
of the class or classes of Certificates that rank senior to the class of
Certificates for which Loan to Aircraft Value is being calculated and (ii)
as of any such date on the basis of the Assumed Appraised Value of all
Aircraft that have been delivered and the Depreciation Assumption) must not
exceed (assuming no default in the payment of the Equipment Notes and after
giving effect to scheduled payments) the percentages set forth in the
following table:
Class A Class B Class C
Certificates Certificates Certificates
40.8% 51.0% 63.0%
FINAL EXPECTED DISTRIBUTION DATE
Class A Certificates: January 20, 2019
Class B Certificates: January 20, 2019
Class C Certificates: January 20, 2019
PART III:
MANDATORY ECONOMIC TERMS OF LEASE
TERM: The Basic Lease Term for each Lease shall
expire by its terms on or after latest maturity
date of the related Equipment Notes.
LEASE PERIOD DATES
(SOMETIMES REFERRED TO
AS RENT PAYMENT DATES): January 20 and July 20
MINIMUM PAYMENTS: Each installment of basic rent,
together with any advances or payments by
Lessee and any payments of deferred equity
amounts by an Owner Participant under a Lease
and the related agreements must be sufficient
for the Owner Trustee to pay in full, on the
date on which such installment of basic rent,
advance, other payment or deferred equity is
due, any payments scheduled to be made on
account of principal of, and interest on, the
related Equipment Notes. If an Owner
Participant is required to make a deferred
equity payment to be used by an Owner Trustee
to pay principal of, and interest on, the
Equipment Notes and the Owner Participant fails
to make the payment, Lessee will be required to
provide the Owner Trustee with funds sufficient
to make the payment.
TERMINATION VALUE
(SOMETIMES REFERRED TO AS
STIPULATED LOSS VALUES
OR TERMINATION AMOUNTS): Termination values (or other comparable termination
amounts), together with all other amounts
payable by Lessee upon termination of any
Lease, and the amount of premium, if any,
payable by the Owner Trustee, must be
sufficient to pay amounts due with respect to
the related Equipment Notes.
ALL-RISK HULL INSURANCE: Not less than Termination Value
(or, other comparable termination amount),
subject to Lessee's right to self-insure on
terms no more favorable to Lessee in any
material respect than those set forth in
Section (d) of Exhibit H to the Lease Forms.
MINIMUM LIABILITY
INSURANCE AMOUNT: As set forth in Exhibit H to the Lease Forms.
PAST DUE RATE: Not less than (i) with respect to any
portion of any payment of Rent that may be
required by the Trust Indenture to be paid by
the Loan Trustee to the holders of any
outstanding Equipment Notes, a rate per annum
equal to 1% over the interest rate then in
effect for such Equipment Notes, and (ii) with
respect to the remaining portion of any payment
of Rent (and the entire amount of any payment
of Rent after the satisfaction and discharge of
the Trust Indenture), a rate per annum equal to
1% over the rate of interest publicly announced
by The Chase Manhattan Bank, (or other major
commercial banking institutions) in New York,
New York from time to time as its base rate of
interest.
PART IV:
MANDATORY ECONOMIC TERMS FOR THE PARTICIPATION AGREEMENT
Loan Trustee, Subordination Agent, Liquidity Provider,
Pass Through Trustees and Note Holders shall be indemnified against
Expenses and Taxes in a manner not materially less favorable to the Loan
Trustees, the Subordination Agent, the Liquidity Provider, the Trustees and
the Note Holders than that set forth in Section 6 of the form of the
Participation Agreement (the "Participation Form") marked as Exhibit A-1 to
the Note Purchase Agreement for the Leased Aircraft or as Exhibit C-1 to
the Note Purchase Agreement for the Owned Aircraft.
SCHEDULE VII to
NOTE PURCHASE AGREEMENT
AGGREGATE AMORTIZATION SCHEDULE
ANNEX A to
NOTE PURCHASE AGREEMENT
DEFINITIONS
"Act" means 49 U.S.C. ss.ss. 40101-46507.
"Affiliate" means, with respect to any person, any other
person directly or indirectly controlling, controlled by or under common
control with such person. For purposes of this definition, "control" means
the power, directly or indirectly, to direct or cause the direction of the
management and policies of such person, whether through the ownership of
voting securities or by contract or otherwise and "controlling,"
"controlled by" and "under common control with" have correlative meanings.
"AIFS" has the meaning set forth in the fourth recital to
the Note Purchase Agreement.
"Aircraft Financing Letter Agreement" means the Aircraft
Financing Letter Agreement, dated as of October 31, 1997 between AVSA,
S.A.R.L., the Company and US Airways Group, Inc., as the same may be
amended or otherwise supplemented from time to time.
"Aircraft Purchase Agreement" means (i) with respect to
A319 and A320 Aircraft, the Purchase Agreement dated as of October 31,
1997, between US Airways Group, Inc. and the Seller (including all exhibits
thereto, together with all letter agreements entered into that by their
terms constitute part of any such Purchase Agreement), and (ii) with
respect to A330 Aircraft, the Purchase Agreement dated as of November 24,
1998 between US Airways Group, Inc. and the Seller (including all exhibits
thereto, together with all letter agreements entered into that by their
terms constitute part of any such Purchase Agreement), as the same may be
amended or otherwise supplemented from time to time.
"Aircraft Purchase Agreement Assignment" means a Purchase
Agreement Assignment substantially in the form of Exhibit A-4 for Leased
Aircraft, and Exhibit C-3 for Owned Aircraft, to the Note Purchase
Agreement.
"Assumed Amortization Schedule" means Schedule VII to the
Note Purchase Agreement.
"Average Life Date" means, for any Equipment Note, the
date which follows the time of determination by a period equal to the
Remaining Weighted Average Life of such Equipment Note.
"Bankruptcy Code" means the United States Bankruptcy Code, 11
U.S.C. ss.ss. 101 et seq.
"Basic Pass Through Trust Agreement" means the Pass
Through Trust Agreement, dated as of July 30, 1999, among the Company, US
Airways Group, Inc. and Pass Through Trustee, as such agreement may be
supplemented, amended or modified, but does not include any Trust
Supplement.
"Business Day" means any day, other than a Saturday,
Sunday or other day on which commercial banks are authorized or required by
law to close in New York, New York, Pittsburgh, Pennsylvania, Hartford,
Connecticut or Salt Lake City,
Utah.
"Certificate" has the meaning set forth in the second
recital to the Note Purchase Agreement.
"Certificate Holder" means the Person in whose name a
Certificate is registered in the Register.
"Class" means the class of Certificates issued by each
Pass Through Trust.
"Class A Certificates" means the Class A Certificates
issued by the US Airways Pass Through Trust, Series 1999-1A.
"Class A Trust" means the US Airways Pass Through Trust,
Series 1999-1A formed pursuant to the Basic Pass Through Trust Agreement
and Class A Trust Supplement.
"Class B Certificates" means the Class B Certificates
issued by the US Airways Pass Through Trust, Series 1999-1B.
"Class B Trust" means the US Airways Pass Through Trust,
Series 1999-1B formed pursuant to the Basic Pass Through Trust Agreement
and Class B Trust Supplement.
"Class C Certificates" means the Class C Certificates
issued by the US Airways Pass Through Trust, Series 1999-1C.
"Class C Purchase Agreement" has the meaning set forth in
the fourth recital to the Note Purchase Agreement.
"Class C Special Deposit Payment" has the meaning set
forth in Section 5(a) of the Note Purchase Agreement.
"Class C Special Indemnity Payment" has the meaning set
forth in each Participation Agreement.
"Class C Trust" means the US Airways Pass Through Series
1999-1C formed pursuant to the Basic Pass Through Trust Agreement and Class
C Trust Supplement.
"Closing Date" means the Business Day on which a closing
occurs under the Financing Agreements.
"Company" means US Airways, Inc., a Delaware corporation
and its successors and permitted assigns.
"Cut-Off Date" means the earlier of (a) the day after the
Delivery Period Termination Date and (b) the date on which a Triggering
Event occurs.
"Delivery Period Termination Date" means the earlier of
(a) July 20, 2000, and (b) the date on which Equipment Notes issued with
respect to all of the New Aircraft (or Substitute Aircraft in lieu thereof)
have been purchased by the Pass Through Trustees in accordance with the
Note Purchase Agreement.
"Deposit" has the meaning set forth in the fifth recital
to the Note Purchase Agreement.
"Deposit Agreement" has the meaning set forth in the
fifth recital to the Note Purchase Agreement.
"Deposit Make-Whole Premium" means, with respect to the
distribution of unused Deposits to holders of any Class of Certificates, as
of any date of determination, an amount equal to the excess, if any, of (a)
the present value of the excess of (i) the scheduled payment of principal
and interest to maturity of the Equipment Notes, assuming the maximum
principal amount thereof (the "Maximum Amount") minus the Non-Premium
Amount and, in the case of the Class C Certificates, the Par Redemption
Amount (without duplication), were issued, on each remaining Regular
Distribution Date for such Class under the Assumed Amortization Schedule
over (ii) the scheduled payment of principal and interest to maturity of
the Equipment Notes actually acquired by the Trustee for such Class on each
such Regular Distribution Date, such present value computed by discounting
such excess on a semiannual basis on each Regular Distribution Date
(assuming a 360-day year of twelve 30-day months) using a discount rate
equal to the Treasury Yield plus [ ] basis points in the case of the Class
A Certificates, [ ] basis points in the case of the Class B Certificates
and [ ] basis points in the case of the Class C Certificates over (b) the
amount of such unused Deposits to be distributed to the holders of such
Certificates, minus the Non-Premium Amount and, in the case of the Class C
Certificates, the Par Redemption Amount (without duplication) plus accrued
and unpaid interest on such net amount to but excluding the date of
determination from and including the preceding Regular Distribution Date
(or if such date of determination precedes the first Regular Distribution
Date, the Issuance Date).
"Depositary" means ABN AMRO Bank N.V., acting through its
Chicago branch.
"Equipment Notes" means and includes any equipment notes
issued under any Indenture in the form specified in Section 2.01 thereof
(as such form may be varied pursuant to the terms of such Indenture) and
any Equipment Note issued under any Indenture in exchange for or
replacement of any other Equipment Note.
"Escrow Agent" has the meaning set forth in the first
paragraph of the Note Purchase Agreement.
"Escrow and Paying Agent Agreement" has the meaning set
forth in the fifth recital to the Note Purchase Agreement.
"FAA" means the Federal Aviation Administration of the
United States.
"Final Withdrawal" with respect to each Escrow and Paying
Agent Agreement, has the meaning set forth in Section 1.2 thereof.
"Financing Agreements" means, collectively, the Lease
Financing Agreements and the Owner Financing Agreements.
"Government Entity" means (a) any federal, state,
provincial or similar government, and any body, board, department,
commission, court, tribunal, authority, agency or other instrumentality of
any such government or otherwise exercising any executive, legislative,
judicial, administrative or regulatory functions of such government or (b)
any other government entity having jurisdiction over any matter
contemplated by the Operative Documents or relating to the observance or
performance of the obligations of any of the parties to the Operative
Documents.
"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.
"Indentures" means, collectively, the Leased Aircraft
Indentures and the Owned Aircraft Indentures.
"Intercreditor Agreement" has the meaning set forth in
the ninth recital to the Note Purchase Agreement.
"Issuance Date" means the date of the original issuance
of the Certificates.
"Law" means (a) any constitution, treaty, statute, law,
decree, regulation, order, rule or directive of any Government Entity, and
(b) any judicial or administrative interpretation or application of, or
decision under, any of the foregoing.
"Lease" means a Lease Agreement substantially in the form
of either Exhibit A-2-1 (Basic Lease Form) or A-2-2 (Deferred
Equity/Prepaid--Deferred Rent Lease Form) to the Note Purchase Agreement.
"Lease Financing Agreements" means, collectively, the
Aircraft Purchase Agreement Assignment, the Leased Aircraft Participation
Agreement, the Lease, the Leased Aircraft Indenture, the Leased Aircraft
French Pledge Agreement, the Equipment Notes issued under the Leased
Aircraft Indenture and the Trust Agreement relating to the financing of a
Leased Aircraft.
"Lease Period" has the meaning set forth in the
Participation Agreement.
"Leased Aircraft" means a New Aircraft subject to a Lease.
"Leased Aircraft French Pledge Agreement" means a French
Pledge Agreement substantially in the form of Exhibit A-6 to the Note
Purchase Agreement.
"Leased Aircraft Indenture" means a Trust Indenture and
Security Agreement substantially in the form of Exhibit A-3 to the Note
Purchase Agreement.
"Leased Aircraft Participation Agreement" means a
Participation Agreement substantially in the form of Exhibit A-1 to the
Note Purchase Agreement.
"Liquidity Facility" has the meaning set forth in the
ninth recital to the Note Purchase Agreement.
"Liquidity Provider" has the meaning set forth in the
ninth recital to the Note Purchase Agreement.
"Loan Trustee" means the "Indenture Trustee" as defined
in the Financing Agreements.
"Mandatory Document Terms" means the terms set forth on
Schedule V to the Note Purchase Agreement.
"Mandatory Economic Terms" means the terms set forth on
Schedule VI to the Note Purchase Agreement.
"Manufacturer" means Airbus Industrie, G.I.E., a
"Groupement d'Interet Economique" established under "Ordonnance" No. 67-821
dated September 23, 1967, of the Republic of France.
"Multiplier" has the meaning set forth in each
Participation Agreement.
"New Aircraft" has the meaning set forth in the first
recital to the Note Purchase Agreement.
"Non-Premium Amount" means the amount equal to unused
Deposits to be distributed due to the failure of an Aircraft to be
delivered prior to the Delivery Period Termination Date due to any reason
not occasioned by US Airways' fault or negligence. Deposits comprising
Non-Premium Amounts will not be treated as unused Deposits in determining
whether the unused Deposits exceed the Par Redemption Amount.
"Note Purchase Agreement" means the Note Purchase
Agreement to which this Annex A is attached.
"Notice of Purchase Withdrawal" with respect to each
Deposit Agreement, has the meaning set forth in Section 2.3 thereof.
"Operative Documents" means, collectively, the Pass
Through Trust Agreements, the Escrow and Paying Agent Agreements, the
Deposit Agreements, the Liquidity Facilities, the Intercreditor Agreement,
the Trust Agreements, the Equipment Notes, the Certificates and the
Financing Agreements.
"Owned Aircraft" means a New Aircraft subject to an Owned
Aircraft Indenture.
"Owned Aircraft French Pledge Agreement" means a French
Pledge Agreement substantially in the form of Exhibit C-4 to the Note
Purchase Agreement.
"Owned Aircraft Indenture" means an Indenture and
Security Agreement substantially in the form of Exhibit C-2 to the Note
Purchase Agreement.
"Owned Aircraft Participation Agreement" means a
Participation Agreement substantially in the form of Exhibit C-1 to the
Note Purchase Agreement.
"Owner Financing Agreements" means, collectively, the
Aircraft Purchase Agreement Assignment, the Owned Aircraft Participation
Agreement, the Owned Aircraft Indenture, the Owned Aircraft French Pledge
Agreement and the Equipment Notes issued thereunder relating to the
financing of an Owned Aircraft.
"Owner Participant" means, with respect to any Leased
Aircraft, the Person named as the Owner Participant in the Participation
Agreement with respect to such Leased Aircraft.
"Owner Trust" means with respect to any Leased Aircraft,
the trust created by the "Trust Agreement" referred to in the Leased
Aircraft Indenture related thereto.
"Owner Trustee" means with respect to any Leased
Aircraft, the "Owner Trustee" party to the "Trust Agreement" referred to in
the Leased Aircraft Indenture related thereto.
"Par Redemption Amount" means (x) in the case where the
unused Deposits are returned due to the fault or negligence of the Company,
$0 and (y) in all other cases $15,000,000.
"Participation Agreements" means, collectively, the
Leased Aircraft Participation Agreements and the Owned Aircraft
Participation Agreements.
"Pass Through Trust" has the meaning set forth in the
second recital to the Note Purchase Agreement.
"Pass Through Trust Agreement" means each of the three
separate Trust Supplements, together in each case with the Basic Pass
Through Trust Agreement, each dated as of the Issuance Date, by and between
the Lessee and Pass Through Trustee.
"Pass Through Trustee" has the meaning set forth in the
first paragraph of the Note Purchase Agreement.
"Paying Agent" has the meaning set forth in the first
paragraph of the Note Purchase Agreement.
"Person" means any individual, firm, partnership, joint
venture, trust, trustee, Government Entity, organization, association,
corporation, government agency, committee, department, authority and other
body, corporate or incorporate, whether having distinct legal status or
not, or any member of any of the same.
"Qualified Owner Participant" has the meaning set forth
in Annex A to the Leased Aircraft Participation Agreement.
"Rating Agencies" means, collectively, at any time, each
nationally recognized rating agency that have been requested by the Company
to rate the Certificates and which shall then be rating the Certificates.
The initial Rating Agencies will be Moody's Investors Service and Standard
& Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc.
"Rating Agency Confirmation" means, with respect to any
Financing Agreement that has been modified in any material respect from the
forms thereof attached to the Note Purchase Agreement or with respect to
Substitute Aircraft or with respect to the length of the period between the
delivery of a New Aircraft and its Scheduled Closing Date, a written
confirmation from each of the Rating Agencies that the use of such
Financing Agreement with such modifications or the substituting of such
Substitute Aircraft for a New Aircraft or the length of such period,
whichever of the foregoing shall in a particular case require Rating Agency
Confirmation, would not result in (i) a reduction of the rating for any
Class of Certificates below the then current rating for such Class of
Certificates or (ii) a withdrawal or suspension of the rating of any Class
of Certificates.
"Register" means the register maintained pursuant to
Sections 3.04 and 7.12 of the Basic Pass Through Trust Agreement with
respect to each Pass Through Trust.
"Regular Distribution Dates" shall mean January 20 and
July 20 of each year, commencing January 20, 2000.
"Remaining Weighted Average Life" means, on a given date
with respect to any Equipment Note, the number of days equal to the
quotient obtained by dividing (a) the sum of each of the products obtained
by multiplying (i) the amount of each then remaining scheduled payment of
principal of such Equipment Note, including the payment due on the maturity
of such Equipment Note by (ii) the number of days from and including such
determination date to but excluding the date on which such payment of
principal is scheduled to be made, by (b) the then outstanding principal
amount of such Equipment Note.
"Section 1110" means 11 U.S.C. ss. 1110 of the Bankruptcy
Code or any successor or analogous Section of the federal bankruptcy Law in
effect from time to time.
"Seller" means AVSA, S.A.R.L., a societe a responsabilite
limitee organized and existing under the laws of the Republic of France and
its successors and permitted assigns.
"Series A Equipment Notes" means Equipment Notes issued
under an Indenture and designated as "Series A" thereunder.
"Series B Equipment Notes" means Equipment Notes issued
under an Indenture and designated as "Series B" thereunder.
"Series C Equipment Notes" means Equipment Notes issued
under an Indenture and designated as "Series C" thereunder.
"Subordination Agent" has the meaning set forth in the
first paragraph of the Note Purchase Agreement.
"Substitute Aircraft" has the meaning set forth in
Section 2(g) of the Note Purchase Agreement.
"Substitute Closing Date" has the meaning set forth in
Section 2(e) of the Note Purchase Agreement.
"Taxes" means all license, recording, documentary,
registration and other similar fees and all taxes, levies, imposts, duties,
charges, assessments or withholdings of any nature whatsoever imposed by
any Taxing Authority, together with any penalties, additions to tax, fines
or interest thereon or additions thereto.
"Taxing Authority" means any federal, state or local
government or other taxing authority in the United States, any foreign
government or any political subdivision or taxing authority thereof, any
international taxing authority or any territory or possession of the United
States or any taxing authority thereof.
"Treasury Yield" means, as of any date of determination,
with respect to any Equipment Note (utilizing the Assumed Amortization
Schedule applicable thereto), the interest rate (expressed 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
semi-annual yield to maturity for United States Treasury securities
maturing on the Average Life Date of such Equipment Note and trading in the
public securities markets 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).
"Triggering Event" has the meaning assigned to such term
in the Intercreditor Agreement.
"Trust Agreement" means a Trust Agreement substantially
in the form of Exhibit A-5 to the Note Purchase Agreement.
"Trust Supplement" means an agreement supplemental to the
Basic Pass Through Trust Agreement pursuant to which (i) a separate trust
is created for the benefit of the holders of the Certificates of a class,
(ii) the issuance of the Certificates of such class representing fractional
undivided interests in such trust is authorized and (iii) the terms of the
Certificates of such class are established.
"Underwriters" has the meaning set forth in the fourth
recital to the Note Purchase Agreement.
EXHIBIT A-1
NOTE PURCHASE AGREEMENT
FORM OF LEASED AIRCRAFT PARTICIPATION AGREEMENT
[FILED SEPARATELY]
EXHIBIT A-2-1 to
NOTE PURCHASE AGREEMENT
FORM OF BASIC LEASE
[FILED SEPARATELY]
EXHIBIT A-2-2 to
NOTE PURCHASE AGREEMENT
FORM OF DEFERRED EQUITY/PREPAID-DEFERRED RENT LEASE
[FILED SEPARATELY]
EXHIBIT A-3 to
NOTE PURCHASE AGREEMENT
FORM OF LEASED AIRCRAFT INDENTURE
[FILED SEPARATELY]
EXHIBIT A-4 to
NOTE PURCHASE AGREEMENT
FORM OF LEASED AIRCRAFT PURCHASE AGREEMENT ASSIGNMENT
[FILED SEPARATELY]
EXHIBIT A-5 to
NOTE PURCHASE AGREEMENT
FORM OF LEASED AIRCRAFT TRUST AGREEMENT
[FILED SEPARATELY]
EXHIBIT A-6 to
NOTE PURCHASE AGREEMENT
FORM OF LEASED AIRCRAFT FRENCH PLEDGE AGREEMENT
[FILED SEPARATELY
EXHIBIT B to
NOTE PURCHASE AGREEMENT
FORM OF CLOSING NOTICE
EXHIBIT B
Closing Notice
Dated as of __________
To each of the addressees listed
in Schedule A hereto
Re: Closing Notice in Accordance with Note Purchase
Agreement Referred to below
Gentlemen:
Reference is made to the Note Purchase Agreement, dated
as of August 31, 1999 among US Airways, Inc. (the "Company"), State Street
Bank and Trust Company of Connecticut, National Association, as Pass
Through Trustee under each of the Pass Through Trust Agreements (as defined
therein) (the "Pass Through Trustee"), State Street Bank and Trust Company
of Connecticut, National Association, as Subordination Agent (the
"Subordination Agent"), First Security Bank, National Association, as
Escrow Agent (the "Escrow Agent") and State Street Bank and Trust Company
of Connecticut, National Association, as Paying Agent (the "Paying Agent")
(as in effect from time to time, the "Note Purchase Agreement"). Unless
otherwise defined herein, capitalized terms used herein shall have the
meanings set forth in the Note Purchase Agreement or, to the extent not
defined therein, the Intercreditor Agreement.
Pursuant to Section 2(b) of the Note Purchase Agreement,
the undersigned hereby notifies you, in respect of the Airbus __________
aircraft with manufacturer's serial number __________ (the "Aircraft"), of
the following:
1. The Company has elected to treat the Aircraft as [a
Leased Aircraft] [an Owned Aircraft];
2. The Scheduled Closing Date for the financing of the
Aircraft is __________; and
3. The aggregate amount of each series of Equipment Notes
to be issued, and purchased by the respective Pass Through Trustees, on the
Closing Date, in connection with the financing of such Aircraft is as
follows: The Class A Trustee shall purchase Series A Equipment Notes in the
amount of $__________, the Class B Trustee shall purchase Series B
Equipment Notes in the amount of $__________ and the Class C Trustee shall
purchase Series C Equipment Notes in the amount of $_________.
The Company hereby instructs the Class A Trustee to (i)
execute a Withdrawal Certificate in the form of Annex A hereto dated as of
__________ and attach thereto a Notice of Purchase Withdrawal dated such
date completed as set forth on Exhibit A hereto and (ii) deliver such
Withdrawal Certificate and Notice of Purchase Withdrawal to the applicable
Escrow Agent.
The Company hereby instructs the Class B Trustee to (i)
execute a Withdrawal Certificate in the form of Annex A hereto dated as of
__________ and attach thereto a Notice of Purchase Withdrawal dated such
date completed as set forth on Exhibit B hereto and (ii) deliver such
Withdrawal Certificate and Notice of Purchase Withdrawal to the applicable
Escrow Agent.
The Company hereby instructs the Class C Trustee to (i)
execute a Withdrawal Certificate in the form of Annex A hereto dated as of
__________ and attach thereto a Notice of Purchase Withdrawal dated such
date completed as set forth on Exhibit C hereto and (ii) deliver such
Withdrawal Certificate and Notice of Purchase Withdrawal to the applicable
Escrow Agent.
The Company hereby instructs each Pass Through Trustee to
(i) purchase Equipment Notes of a series and in an amount set forth
opposite such Pass Through Trustee in clause (3) above with a portion of
the proceeds of the withdrawals of Deposits referred to in the applicable
Notice of Purchase Withdrawal referred to above and (ii) re-deposit with
the Depositary the excess, if any, of the amount so withdrawn over the
purchase price of such Equipment Notes.
The Company hereby instructs each Pass Through Trustee to
(a) enter into the Participation Agreement dated as of __________ among the
Company, as Lessee, the Subordination Agent, the Pass Through Trustee,
State Street Bank and Trust Company of Connecticut, National Association,
as Loan Trustee and Loan Participant, First Security Bank, National
Association, as Owner Trustee and __________, as Owner Participant, (b)
perform its obligations thereunder and (c) deliver such certificates,
documents and legal opinions relating to such Pass Through Trustee as
required thereby.
[The Company hereby certifies that the Owner Participant
with respect to the Aircraft is not an Affiliate of the Company and is (A)
a Qualified Owner Participant or (B) a Person the obligations of which
under the Financing Agreements are guaranteed by a Qualified Owner
Participant.]1
Yours faithfully,
US Airways, Inc.
By:_____________________________
Name:
Title:
- --------
1 Use for Leased Aircraft only.
SCHEDULE A
State Street Bank and Trust Company
of Connecticut, National Association, as
Pass Through Trustee, Subordination
Agent and Paying Agent
225 Asylum Street
Goodwin Square
Hartford, CN 06103
Attention: Corporate Trust Administration
Facsimile: (860) 244-1889
with a copy to:
State Street Bank and Trust Company
2 Avenue de Lafayette, 6th Floor
Boston, MA 02111
Attention: Corporate Trust Department
Facsimile: (617) 662-1461
First Security Bank, National Association,
as Escrow Agent
79 South Main Street
Salt Lake City, UT 84111
Attention: Corporate Trust Department
Facsimile: (801) 246-5053
Standard & Poor's Ratings Services
55 Water Street, 39th Floor
New York, New York 10041
Attention: Philip Baggaley
Facsimile: (212) 412-0540
Moody's Investors Service
99 Church Street
New York, New York 10007
Attention: Robert Jankowitz
Facsimile: (212) 553-4600
Annex A
WITHDRAWAL CERTIFICATE
First Security Bank, National Association,
as Escrow Agent
79 South Main Street
Salt Lake City, UT 84111
Attention: Corporate Trust Services
Telecopier: (801) 246-5053
Ladies and Gentlemen:
Reference is made to the Escrow and Paying Agent Agreement,
dated as of August 31, 1999 (the "Agreement"). We hereby certify to you
that the conditions to the obligations of the undersigned to execute a
Participation Agreement pursuant to the Note Purchase Agreement have been
satisfied. Pursuant to Section 1.2(c) of the Agreement, please execute the
attached Notice of Withdrawal and immediately transmit by facsimile to the
Depositary, at __________.
Capitalized terms used herein but not defined herein shall
have the meanings set forth in the Agreement.
Very truly yours,
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, not in
its individual capacity by
solely as Pass Through Trustee
By:______________________________
Name:
Title:
Dated: As of __________
Exhibit A
NOTICE OF PURCHASE WITHDRAWAL
ABN AMRO Bank, N.V.
[ ]
[ ]
[ ]
Attention: [ ]
Telecopier: [ ]
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class A) dated as of
August 31, 1999 (the "Deposit Agreement") between First Security Bank,
National Association, as Escrow Agent, and ABN AMRO Bank, N.V., as
Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of the
Deposit, $__________, Account No. __________.
The undersigned hereby directs the Depositary to pay the proceeds
of the Deposit to _______________, Account No. __________, Reference:
__________ on _______________, _____, upon the telephonic request of a
representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, as Escrow Agent
By______________________________
Name:
Title:
Dated:___________, ____
Exhibit B
NOTICE OF PURCHASE WITHDRAWAL
ABN AMRO Bank, N.V.
[ ]
[ ]
[ ]
Attention: [ ]
Telecopier: [ ]
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class B) dated as of
August 31, 1999 (the "Deposit Agreement") between First Security Bank,
National Association, as Escrow Agent, and ABN AMRO Bank, N.V., as
Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of the
Deposit, $__________, Account No. __________.
The undersigned hereby directs the Depositary to pay the proceeds
of the Deposit to _______________, Account No. __________, Reference:
__________ on _______________, _____, upon the telephonic request of a
representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, as Escrow Agent
By______________________________
Name:
Title:
Dated:___________, ____
Exhibit C
[NOTICE OF PURCHASE WITHDRAWAL]
ABN AMRO Bank, N.V.
[ ]
[ ]
[ ]
Attention: [ ]
Telecopier: [ ]
Ladies and Gentlemen:
Reference is made to the Deposit Agreement (Class C) dated as of
August 31, 1999 (the "Deposit Agreement") between First Security Bank,
National Association, as Escrow Agent, and ABN AMRO Bank, N.V., as
Depositary (the "Depositary").
In accordance with Section 2.3(a) of the Deposit Agreement, the
undersigned hereby requests the withdrawal of the entire amount of the
Deposit, $__________, Account No. __________.
The undersigned hereby directs the Depositary to pay the proceeds
of the Deposit to _______________, Account No. __________, Reference:
__________ on _______________, _____, upon the telephonic request of a
representative of the Pass Through Trustee.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, as Escrow Agent
By________________________________
Name:
Title:
Dated:___________, ____
EXHIBIT C-1 to
NOTE PURCHASE AGREEMENT
FORM OF OWNED AIRCRAFT PARTICIPATION AGREEMENT
[FILED SEPARATELY]
EXHIBIT C-2 to
NOTE PURCHASE AGREEMENT
FORM OF OWNED AIRCRAFT INDENTURE
[FILED SEPARATELY]
EXHIBIT C-3 to
NOTE PURCHASE AGREEMENT
FORM OF OWNED AIRCRAFT PURCHASE AGREEMENT ASSIGNMENT
[FILED SEPARATELY]
EXHIBIT C-4 to
NOTE PURCHASE AGREEMENT
FORM OF OWNED AIRCRAFT FRENCH PLEDGE AGREEMENT
[FILED SEPARATELY]
Exhibit 4(a)(xiii)
Exhibit A-1 to
Note Purchase Agreement
FORM OF LEASED AIRCRAFT PARTICIPATION AGREEMENT
===========================================================================
PARTICIPATION AGREEMENT
(US Airways, Inc. Trust No. N___U_)
Dated as of
_________ __, ____
Among
US AIRWAYS, INC.,
Lessee,
[__________________],
Owner Participant,
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity except
as expressly provided herein, but solely as
Pass Through Trustee under each of the
Pass Through Trust Agreements,
Subordination Agent and Indenture Trustee
and
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not in its individual capacity
except as expressly provided herein,
but solely as Owner Trustee,
____________________________
One Airbus A___ (1) Aircraft
_____________________
(1) Insert A319, A320 or A330 as appropriate.
U.S. Registration No. N___U_
===========================================================================
Participation Agreement
N___U_
INDEX TO PARTICIPATION AGREEMENT
Page
----
SECTION 1. DEFINITIONS AND CONSTRUCTION. . . . . . . . . . . . . 2
SECTION 2. PARTICIPATIONS IN LESSOR'S COST OF THE AIRCRAFT . . . 3
(a) Participation by Pass Through Trustees on the
Delivery Date; Issuance of Equipment Notes. . . . . . . . . . . 3
(b) Payment of Owner Participant's Commitment. . . . 3
(c) Lessee's Notice of Delivery Date. . . . . . . . . 4
(d) Default by Pass Through Trustee or Owner
Participant . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(e) Closing . . . . . . . . . . . . . . . . . . . . 4
(f) Postponement of Scheduled Closing Date. . . . . 4
SECTION 3. INSTRUCTIONS TO THE OWNER TRUSTEE . . . . . . . . . . 6
SECTION 4. CONDITIONS PRECEDENT. . . . . . . . . . . . . . . . . 6
(a) Conditions Precedent to the Participations
in the Aircraft . . . . . . . . . . . . . . . . . . . . . . . . 6
(b) Conditions Precedent to the Obligations of
Lessee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 5. EXTENT OF INTEREST OF NOTE HOLDERS . . . . . . . . 18
SECTION 6. REPRESENTATIONS AND WARRANTIES OF LESSEE;
INDEMNITIES . . . . . . . . . . . . . . . . . . . . . . . . . 18
(a) Representations and Warranties . . . . . . . . . . 18
(b) General Tax Indemnity . . . . . . . . . . . . . . . 22
(i) Indemnity . . . . . . . . . . . . . . . . . . 22
(ii) Exclusions from General Tax Indemnity . . . . 23
(iii) Payments . . . . . . . . . . . . . . . . . . . 26
(iv) Contests. . . . . . . . . . . . . . . . . . 28
(v) Refund. . . . . . . . . . . . . . . . . . . . 31
(vi) Tax Filing . . . . . . . . . . . . . . . . . . 31
(vii) Forms. . . . . . . . . . . . . . . . . . . . . 32
(viii)Non-Parties. . . . . . . . . . . . . . . . . . 32
(ix) Subrogation. . . . . . . . . . . . . . . . . . 32
(x) Foreign Tax On Loan Payments . . . . . . . . . 32
(xi) Income Tax . . . . . . . . . . . . . . . . . . 33
(c) General Indemnity. . . . . . . . . . . . . . . . . . 33
(d) Special Indemnity. . . . . . . . . . . . . . . . . . 39
SECTION 7. REPRESENTATIONS, WARRANTIES AND COVENANTS. . . . . . 38
(a) Covenants Regarding Citizenship. . . . . . . . . . 38
(b) Location of Records . . . . . . . . . . . . . . . . 39
(c) Securities Act . . . . . . . . . . . . . . . . . . 39
(d) Reregistration . . . . . . . . . . . . . . . . . . 39
(e) Owner Participant Representations and Warranties . 42
(f) Lessor Liens . . . . . . . . . . . . . . . . . . . 44
(g) Quiet Enjoyment . . . . . . . . . . . . . . . . . . 44
(h) Equipment Notes Acquired for Investment . . . . . . 44
(i) [Reserved] . . . . . . . . . . . . . . . . . . . . 44
(j) Representations, Warranties and Covenants of
Indenture Trustee . . . . . . . . . . . . . . . . . 45
(k) Owner Participant Transfers . . . . . . . . . . . . 46
(l) Reserved. . . . . . . . . . . . . . . . . . . . . . 48
(m) Compliance with Trust Indenture . . . . . . . . . . 48
(n) ERISA Matters . . . . . . . . . . . . . . . . . . . 48
(o) Confidentiality of Purchase Agreement . . . . . . . 49
(p) Margin Regulations . . . . . . . . . . . . . . . . 49
(q) Loan Participant Liens . . . . . . . . . . . . . . 49
(r) Indenture Trustee Liens . . . . . . . . . . . . . . 50
(s) Representations and Warranties of Owner Trustee . . 50
(t) Owner Participant Obligations on Lease Termination. 54
(u) Transfer of Title; Assumption of Equipment Notes . 54
(v) Lessee Merger Covenant. . . . . . . . . . . . . . . 55
(w) Further Assurances . . . . . . . . . . . . . . . . 56
(x) Rent Adjustments . . . . . . . . . . . . . . . . . 57
(y) Owner Participant Costs on Return . . . . . . . . . 57
(z) Transfer of Equipment Notes . . . . . . . . . . . . 57
(aa) Representations and Warranties of Pass Through
Trustee . . . . . . . . . . . . . . . . . . . . . . 57
(bb) Representations and Warranties of Subordination
Agent . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 8. RELIANCE OF LIQUIDITY PROVIDER . . . . . . . . . . 62
SECTION 9. OTHER DOCUMENTS . . . . . . . . . . . . . . . . . . 62
SECTION 10. CERTAIN COVENANTS OF LESSEE . . . . . . . . . . . . 63
(a) Further Assurances . . . . . . . . . . . . . . . . 63
(b) Filings . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 11. OWNER FOR FEDERAL TAX PURPOSES . . . . . . . . . . 64
SECTION 12. NOTICES; CONSENT TO JURISDICTION . . . . . . . . . 64
(a) Notices . . . . . . . . . . . . . . . . . . . . . . 64
(b) Consent to Jurisdiction . . . . . . . . . . . . . . 64
SECTION 13. CHANGE OF SITUS OF OWNER TRUST. . . . . . . . . . . 65
SECTION 14. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . 66
(a) Consents Under Lease . . . . . . . . . . . . . . . 66
(b) Survival . . . . . . . . . . . . . . . . . . . . . 66
(c) Counterparts . . . . . . . . . . . . . . . . . . . 66
(d) Amendments and Waivers . . . . . . . . . . . . . . 67
(e) Successors and Assigns . . . . . . . . . . . . . . 67
(f) Governing Law . . . . . . . . . . . . . . . . . . . 67
(g) Trust Capacity . . . . . . . . . . . . . . . . . . 67
(h) Section 1110 . . . . . . . . . . . . . . . . . . . 68
SECTION 15. EXPENSES. . . . . . . . . . . . . . . . . . . . . . 68
(a) Invoices And Payment . . . . . . . . . . . . . . . 68
(b) Payment of Other Expenses. . . . . . . . . . . . . 68
SECTION 16. REFINANCINGS. . . . . . . . . . . . . . . . . . . . 69
(a) Refinancing Generally . . . . . . . . . . . . . . . 69
(b) Limitation on Redemption . . . . . . . . . . . . . 72
ANNEXES
ANNEX A - Definitions
SCHEDULES
SCHEDULE I Names and Addresses
SCHEDULE II Commitments
SCHEDULE III Pass Through Trust Agreement and Pass Through Trust
Supplements
SCHEDULE IV [Deferred Equity Payments] (2)
_________________________
(2) For Deferred Equity Transactions Only.
EXHIBITS
Exhibit A - Schedule of Countries Authorized for Reregistration
Exhibit B-1 - Form of Opinion of Skadden, Arps, Slate, Meagher & Flom
(Illinois), special counsel for Lessee
Exhibit B-3 - Form of Opinion of Lessee's Legal Department
Exhibit C - Form of Opinion of Clifford Chance Regarding Manufacturer
Documents
Exhibit D - Form of Opinion of Ray, Quinney & Nebeker, special counsel
for the Owner Trustee
Exhibit E-1 - Form of Opinion of ______________, special counsel for the
Owner Participant
Exhibit E-2 - Form of Opinion of Owner Participant's in-house counsel
Exhibit F - Form of Opinion of Crowe & Dunlevy, P.C., special FAA Counsel
Exhibit G - Form of Opinion of Bingham Dana LLP, special counsel for the
Indenture Trustee
Exhibit H - Form of Opinion of Bingham Dana LLP, special counsel for the
Pass Through Trustee
Exhibit I - Form of Opinion of Bingham Dana LLP, special counsel for the
Subordination Agent
Participation Agreement
N___U_
PARTICIPATION AGREEMENT
(US Airways, Inc. Trust No. N___U_)
THIS PARTICIPATION AGREEMENT (US Airways, Inc. Trust No. N___U_)
dated as of _______ ___, (as amended, supplemented or otherwise modified
from time to time, this "Agreement") among (i) US AIRWAYS, INC., a Delaware
corporation (together with its successors and permitted assigns, the
"Lessee", (ii) [_______________], a ______________ (together with its
successors and permitted assigns, the "Owner Participant"), (iii) STATE
STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity except as
otherwise provided herein, but solely as pass through trustee under each of
three separate Pass Through Trust Agreements (in such capacity, together
with its successors and permitted assigns, the "Pass Through Trustee"),
subordination agent and trustee under the Intercreditor Agreement (in such
capacity, together with its successors and permitted assigns, the
"Subordination Agent"), and Indenture Trustee under the Trust Indenture (in
such capacity, together with any successor indenture trustee, the
"Indenture Trustee"), and (iv) FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity except as
expressly provided herein, but solely as Owner Trustee under the Trust
Agreement (herein, in such latter capacity, together with any successor
owner trustee, called the "Owner Trustee");
W I T N E S S E T H:
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Owner Participant is entering into the Trust Agreement with
the Owner Trustee, pursuant to which Trust Agreement the Owner Trustee
agrees, among other things, to hold the Trust Estate for the use and
benefit of the Owner Participant;
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Indenture Trustee and the Owner Trustee are entering into
the Trust Indenture pursuant to which the Owner Trustee will issue to the
Loan Participants Equipment Notes in three series, which Equipment Notes
are to be secured by the mortgage and security interests created by the
Owner Trustee in favor of the Indenture Trustee;
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Owner Trustee will execute and deliver a Trust and Indenture
Supplement covering the Aircraft, supplementing the Trust Agreement and the
Trust Indenture;
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Owner Trustee and Lessee have entered into the Lease
whereby, subject to the terms and conditions set forth therein, the Owner
Trustee agrees to lease to Lessee, and Lessee agrees to lease from the
Owner Trustee, the Aircraft on the Delivery Date;
WHEREAS, on the Delivery Date for the Aircraft, the Lessee will
deliver a Lease Supplement covering the Aircraft;
WHEREAS, pursuant to the terms of the Note Purchase Agreement,
the Pass Through Trustee will purchase from the Owner Trustee on the
Delivery Date, on behalf of each Pass Through Trust, all of the Equipment
Notes bearing the same interest rate as the Certificates issued by such
Pass Through Trust;
WHEREAS, prior to the execution and delivery of this Agreement,
(i) the Liquidity Provider entered into three separate Liquidity
Facilities, one for the benefit of the holders of Certificates of each of
the Class A Pass Through Trust, the Class B Pass Through Trust and the
Class C Pass Through Trust (each referenced on Schedule III hereto), with
the Subordination Agent, as agent for the Pass Through Trustee on behalf of
each such Pass Through Trust; and (ii) the Pass Through Trustee, the
Liquidity Provider and the Subordination Agent have entered into the
Intercreditor Agreement;
WHEREAS, the Equipment Notes will be held by the Subordination
Agent pursuant to the Intercreditor Agreement on behalf of the Pass Through
Trusts;
WHEREAS, the acquisition of the Aircraft by Lessee from the
Seller and the aforementioned sale and leaseback transaction are integrally
related and constitute a series of events designed to provide financing for
such Aircraft and a means of providing the Aircraft to the Lessee for use
in its business.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND CONSTRUCTION.
Capitalized terms used but not defined herein shall have the
respective meanings set forth or incorporated by reference, and shall be
construed and interpreted in the manner described, in Annex A.
SECTION 2. PARTICIPATIONS IN LESSOR'S COST OF THE AIRCRAFT.
(a) Participation by Pass Through Trustees on the Delivery Date;
Issuance of Equipment Notes. Subject to the terms and conditions of this
Agreement, the Pass Through Trustee for each Pass Through Trust agrees to
make a non-recourse (except as provided herein) secured loan to the Owner
Trustee on the Delivery Date to finance, in part, the Owner Trustee's
payment of Lessor's Cost for the Aircraft by paying to the Owner Trustee
the aggregate purchase price of the Equipment Notes being issued to such
Pass Through Trustee as set forth on Schedule II opposite the name of such
Pass Through Trust. The Pass Through Trustees shall make such payments to
the Owner Trustee on a date to be designated pursuant to Section 2(c) but
in no event later than __________________, by transferring to the account
of the Owner Trustee at State Street Bank and Trust Company of Connecticut,
National Association, 225 Asylum Street, Hartford, Connecticut 06103, ABA
No. _________, Account No. __________, Reference: US Airways, Inc. 1999-1
EETC/US Airways, Inc. Trust No. N___U_), not later than 9:30 a.m., New
York City time, on the Delivery Date in immediately available funds in
Dollars, the amount set forth opposite the name of such Pass Through Trust
on Schedule II hereto.
Upon the occurrence of the above transfers by the Pass Through
Trustee for each Pass Through Trust to the Owner Trustee, the Owner
Trustee, at the direction of the Owner Participant, shall issue, pursuant
to Article II of the Trust Indenture, to the Subordination Agent on behalf
of the Pass Through Trustee for each of the Pass Through Trusts, Equipment
Notes of the maturity and aggregate principal amount, bearing the interest
rate and for the purchase price set forth on Schedule II opposite the name
of such Pass Through Trust.
(b) Payment of Owner Participant's Commitment. Subject to the
terms and conditions of this Agreement, the Owner Participant agrees with
the Lessee and only with the Lessee on behalf of the Owner Trustee, subject
to the terms and conditions of this Agreement, to make the amount of its
Commitment as set forth on Schedule II available for and on account of the
Owner Trustee on the Delivery Date specified in the Delivery Notice
pursuant to Section 2(c) by wire transfer of such amount in immediately
available funds, to the Owner Trustee for deposit in its account at State
Street Bank and Trust Company of Connecticut, National Association, 225
Asylum Street, Hartford, Connecticut 06103, ABA No. _________, Account No.
__________, Reference: US Airways, Inc. 1999-1 EETC/US Airways, Inc.
Trust No. N___U_, not later than 9:30 a.m., New York City time. The
amount of the Owner Participant's Commitment shall be held for the account
of the Owner Participant by the Owner Trustee until released by the Owner
Participant or its special counsel at closing or until returned to the
Owner Participant in accordance with Section 2(f).
(c) Lessee's Notice of Delivery Date. The Lessee agrees to give
the Owner Participant, the Indenture Trustee, the Owner Trustee, the Pass
Through Trustee and the Subordination Agent at least three (3) Business
Days written or facsimile notice prior to the Delivery Date, which notice
shall specify the Lessor's Cost for the Aircraft, the estimated amount of
the Owner Participant's Commitment, the Delivery Date for the Aircraft, the
serial number of the Airframe and each Engine, and the United States
registration number for the Aircraft.
(d) Default by Pass Through Trustee or Owner Participant. In
case any of the Pass Through Trustee or the Owner Participant shall default
in its obligation under the provisions of this Section 2, no other such
party shall have any obligation to make any portion of such defaulted
amount available or to increase the amount of its Commitment and the
obligation of such nondefaulting party shall remain subject to the terms
and conditions set forth in this Agreement.
(e) Closing. The closing of the transactions referred to in
this Agreement shall take place commencing at 9:30 a.m. local time, on the
Delivery Date, at the offices of Skadden, Arps, Slate, Meagher & Flom LLP
in New York, New York.
(f) Postponement of Scheduled Closing Date.
(i) If for any reason whatsoever the closing of the
transactions contemplated hereby is not consummated on the Delivery
Date provided for pursuant to Section 2(c) (the "Scheduled Delivery
Date"), the closing shall be deemed adjourned to the next Business
Day or to such other Business Day on or prior to _______________ as
Lessee shall specify by written notice to the Pass Through Trustee,
the Owner Participant, the Owner Trustee and the Indenture Trustee, in
which case the Owner Participant will keep its funds available.
(ii) If the closing fails to occur on the Scheduled Delivery
Date, the Owner Trustee shall promptly return to each Participant that
makes funds available to it in accordance with this Section 2 such
funds, together with interest or income earned thereon.
(iii) If the closing fails to occur on the Scheduled Delivery
Date and funds are not returned to each Participant that made funds
available as provided by clause (ii) above, the Owner Trustee shall,
if so instructed by Lessee, use reasonable efforts to invest, at the
risk of Lessee, the funds received by it from Participants in Cash
Equivalents. Any such obligations purchased by the Owner Trustee,
whether directly or through a repurchase agreement, shall be held in
trust by the Owner Trustee for the benefit of the respective
Participants that provided such funds, and not as part of the Trust
Estate or the Trust Indenture Estate.
(iv) If the closing fails to occur on the Scheduled Delivery
Date, unless the Owner Trustee returns all funds to the Participants
by 2:00 p.m., New York City time, on the Scheduled Delivery Date,
Lessee shall reimburse each Participant that has made funds available
pursuant to this Section 2 for the loss of the use of its funds an
amount equal to the excess, if any, of (x) interest at the Debt Rate
on the amount of such funds for the period from and including the
Scheduled Delivery Date to but excluding the actual Delivery Date or,
if earlier, the day on which such Participant's funds are returned if
such return is made by 2:00 p.m., New York City time (or to but
excluding the next following Business Day if such return is not made
by such time) over (y) any amount paid to such Participant in respect
of interest or income earned by the Owner Trustee pursuant to clause
(iii) above.
(v) On the Delivery Date or on the date funds are required to be
returned to Participants pursuant to clause (ii) above, Lessee shall
reimburse the Owner Trustee, for the benefit of Participants that
provided funds which are invested by the Owner Trustee pursuant to
this subsection (f), for any losses incurred on such investments.
All income and profits on the investment of such funds shall be for
the respective accounts of such Participants, and the Owner Trustee
shall not be liable for failure to invest such funds or for any losses
incurred on such investments, except for its own negligence or willful
misconduct.
SECTION 3. INSTRUCTIONS TO THE OWNER TRUSTEE.
The Owner Participant agrees that its releasing the amount
of its Commitment for the Aircraft to the account of the Owner Trustee in
accordance with the terms of Section 2 and its instructions to the Owner
Trustee to release such funds shall constitute, without further act,
authorization and direction by the Owner Participant to the Owner Trustee:
(i) to purchase the Aircraft from Lessee and to pay to Lessee
the Lessor's Cost for the Aircraft;
(ii) to the extent not previously accomplished by a prior
authorization, to authorize a representative or representatives of the
Owner Trustee (who shall be an employee or employees, or an agent or
agents, of Lessee designated by Lessee) to accept delivery of the
Aircraft on the Delivery Date pursuant to the Acceptance Certificate;
(iii) to accept from Lessee the Bill of Sale and the FAA Bill of
Sale for the Aircraft referred to in Section 4(a)(v)(8) and
4(a)(v)(9);
(iv) to execute an Aircraft Registration Application, the Lease
Supplement and the Trust Supplement, in each case covering the
Aircraft;
(v) to borrow from the Pass Through Trustee and issue the
Equipment Notes as provided in Section 2(a); and
(vi) to take such other action as may be required to be taken by
the Owner Trustee on the Delivery Date by the terms of any Operative
Document.
SECTION 4. CONDITIONS PRECEDENT.
(a) Conditions Precedent to the Participations in the Aircraft.
It is agreed that the obligations of the Owner Trustee, the Owner
Participant, the Indenture Trustee, the Subordination Agent and the Pass
Through Trustee on behalf of each Pass Through Trust to participate in the
transactions contemplated hereby on the Delivery Date are subject to the
fulfillment to the satisfaction of each party (or waiver by such party),
prior to or on the Delivery Date of the following conditions precedent,
except that paragraphs (iii) and (v)(5), (xxi), (xxii) and (xxiii) shall
not be a condition precedent to the obligations of the Pass Through
Trustee, and paragraphs (iv), (vii) (insofar as it relates certificates and
documents to be delivered by the Owner Participant) and (xiv) shall not be
a condition precedent to the obligation of the Owner Participant and
paragraph (xxv) shall not be a condition precedent to the obligations of
the Subordination Agent:
(i) At least three (3) Business Days prior to the Delivery Date,
each of the parties hereto shall have received the Delivery Notice
pursuant to Section 2(c).
(ii) On the Delivery Date, no change shall have occurred after
the date of the execution and delivery of this Agreement in applicable
law or regulations or guidelines or interpretations thereof by
appropriate regulatory authorities which would make it a violation of
law or regulations or guidelines for the Pass Through Trustee or the
Owner Participant to make its Commitment available in accordance with
Section 2.
(iii) In the case of the Owner Participant, the Pass Through
Trustees shall have made available the amount of their Commitments
for the Aircraft in accordance with Section 2.
(iv) In the case of the Pass Through Trustees, the Owner
Participant shall have made available the amount of its Commitment
for the Aircraft in accordance with Section 2.
(v) The following documents shall have been duly authorized,
executed and delivered by the respective party or parties thereto,
shall each be satisfactory in form and substance to the Owner
Trustee, the Owner Participant, the Indenture Trustee, the Pass
Through Trustee and the Subordination Agent and shall be in full
force and effect and executed counterparts shall have been delivered
to the Owner Trustee, the Owner Participant, the Indenture Trustee,
the Pass Through Trustee and the Subordination Agent, or their
respective counsel, provided that only the Subordination Agent on
behalf of each Pass Through Trustee shall receive an executed
original of such Pass Through Trustee's respective Equipment Note and
provided, further, that an excerpted copy of the Purchase Agreement
shall only be delivered to and retained by the Owner Trustee (but the
Indenture Trustee shall also retain an excerpted copy of the Purchase
Agreement which may be inspected by the Owner Participant and its
counsel prior to the Delivery Date and subsequent to the Delivery
Date may be inspected and reviewed by the Indenture Trustee if and
only if there shall occur and be continuing an Indenture Event of
Default), the chattel paper counterpart of the Lease and the Lease
Supplement covering the Aircraft dated the Delivery Date shall be
delivered to the Indenture Trustee, the Tax Indemnity Agreement need
only be satisfactory to the Owner Participant and Lessee and shall
only be delivered to Lessee and the Owner Participant and their
respective counsel:
(1) an excerpted copy of the Purchase Agreement
(insofar as it relates to the Aircraft);
(2) the Purchase Agreement Assignment;
(3) the Lease;
(4) a Lease Supplement covering the Aircraft dated the
Delivery Date;
(5) the Tax Indemnity Agreement;
(6) the Trust Agreement;
(7) a Trust Indenture and Trust Supplement covering
the Aircraft dated the Delivery Date;
(8) the Bill of Sale;
(9) the FAA Bill of Sale;
(10) an acceptance certificate covering the Aircraft in
the form agreed to by the Owner Participant and Lessee
(herein called the "Acceptance Certificate") duly completed
and executed by the Owner Trustee or its agent, which may be
a representative of Lessee, and by such representative on
behalf of Lessee;
(11) the Trust Indenture;
(12) the Equipment Notes;
(13) the Consent and Agreement; and
(14) the French Law Pledge Agreement.
In addition, the Pass Through Trustee and the Owner Participant
each shall have received executed counterparts or conformed copies of
the following documents:
(1) each of the Pass Through Trust Agreements;
(2) the Intercreditor Agreement; and
(3) the Liquidity Facility for each of the Class A,
Class B and Class C Pass Through Trusts.
(vi) A Uniform Commercial Code financing statement or statements
covering all the security interests created by or pursuant to the
Granting Clause of the Trust Indenture that are not covered by the
recording system established by the Transportation Code shall have
been executed and delivered by the Owner Trustee, and arrangements
satisfactory to the Owner Participant and the Indenture Trustee shall
have been made for the filing of such financing statement or
statements in all places necessary or advisable, and any additional
Uniform Commercial Code financing statements deemed advisable by the
Owner Participant or the Pass Through Trustee shall have been
executed and delivered by Lessee or the Owner Trustee and
arrangements satisfactory to the Owner Participant and the Indenture
Trustee shall have been made for the filing of such financing
statements.
(vii) The Owner Trustee, the Owner Participant, the Indenture
Trustee, Pass Through Trustee and the Subordination Agent shall have
received the following, in each case in form and substance
satisfactory to it (except it shall not be a condition to the
obligation of any such party that it receive a certificate or other
document required to be delivered by it):
(A) (1) an incumbency certificate of Lessee as to the person or
persons authorized to execute and deliver the Operative
Documents to which the Lessee is a party and any other documents
to be executed on behalf of Lessee in connection with the
transactions contemplated hereby and the signatures of such
person or persons; (2) a copy of the resolutions of the board of
directors of Lessee or Lessee's executive committee, certified
by the Secretary or an Assistant Secretary of Lessee, duly
authorizing the transactions contemplated hereby and the
execution and delivery of each of the documents required to be
executed and delivered on behalf of Lessee in connection with
the transactions contemplated hereby; and (3) a copy of the
certificate of incorporation of Lessee, certified by the
Secretary of State of the State of Delaware, a copy of the
by-laws of Lessee certified by the Secretary or Assistant
Secretary of Lessee, and a certificate or other evidence from
the Secretary of State of the State of Delaware, dated as of a
date shortly prior to the closing, as to the due incorporation
and good standing of Lessee in such state.
(B) (1) an incumbency certificate of the Indenture Trustee
as to the person or persons authorized to execute and
deliver the Operative Documents to which the Indenture
Trustee is a party and any other documents to be executed on
behalf of the Indenture Trustee in connection with the
transactions contemplated hereby and the signatures of such
person or persons;
(2) a copy of the resolutions of the board of
directors of the Indenture Trustee, certified by the
Secretary or an Assistant Secretary of the Indenture
Trustee, duly authorizing the transactions contemplated
hereby and the execution and delivery of each of the
documents required to be executed and delivered on behalf of
the Indenture Trustee in connection with the transactions
contemplated hereby;
(3) a copy of the articles of association of the
Indenture Trustee certified by the Comptroller of the
Currency, a copy of the by-laws of the Indenture Trustee
certified by the Secretary or an Assistant Secretary of the
Indenture Trustee, and a certificate or other evidence from
the Comptroller of the Currency, dated as of a date shortly
prior to closing, as to the existence of the Indenture
Trustee under the laws of the United States of America; and
(4) a certificate signed by an authorized officer of
the Indenture Trustee, dated the Delivery Date, certifying
that the representations and warranties contained herein of
the Indenture Trustee are correct in all material respects
as though made on and as of the Delivery Date, except to the
extent that such representations and warranties relate
solely to an earlier date (in which case such
representations and warranties are correct on and as of such
earlier date).
(C) (1) an incumbency certificate of the Owner Trustee as
to the person or persons authorized to execute and deliver
the Operative Documents to which the Owner Trustee is a
party and any other documents to be executed on behalf of
the Owner Trustee in connection with the transactions
contemplated hereby and the signatures of such person or
persons;
(2) a copy of the resolutions of the board of
directors of the Owner Trustee, certified by the Secretary
or an Assistant Secretary of the Owner Trustee, duly
authorizing the transactions contemplated hereby and the
execution and delivery of each of the documents required to
be executed and delivered on behalf of the Owner Trustee in
connection with the transactions contemplated hereby;
(3) a copy of the articles of association of the Owner
Trustee certified by the Comptroller of the Currency, a copy
of the by-laws of the Owner Trustee certified by the
Secretary or an Assistant Secretary of the Owner Trustee and
a certificate or other evidence from the Comptroller of the
Currency, dated as of a date shortly prior to closing, as to
the good standing of the Owner Trustee; and
(4) a certificate signed by an authorized officer of
the Owner Trustee, dated the Delivery Date, certifying that
the representations and warranties contained herein of the
Owner Trustee (in its individual capacity and as trustee)
are correct in all material respects as though made on and
as of the Delivery Date, except to the extent that such
representations and warranties relate solely to an earlier
date (in which case such representations and warranties are
correct on and as of such earlier date).
(D) (1) an incumbency certificate of the Owner Participant
as to the person or persons authorized to execute and
deliver the Operative Documents to which the Owner
Participant is a party and any other documents to be
executed on behalf of the Owner Participant in connection
with the transactions contemplated hereby and the signatures
of such person or persons;
(2) a copy of the resolutions of the board of
directors of the Owner Participant, certified by the
Secretary or an Assistant Secretary of the Owner
Participant, duly authorizing the transactions contemplated
hereby and the execution and delivery of each of the
documents required to be executed and delivered on behalf of
the Owner Participant in connection with the transactions
contemplated hereby have been duly authorized;
(3) a copy of the certificate of incorporation of the
Owner Participant certified by the Secretary of State of the
State of __________, a copy of the by-laws of the Owner
Participant, each certified by the Secretary or an Assistant
Secretary of the Owner Participant, and a certificate or
other evidence from the Secretary of State of the State of
____________, dated as of a date shortly prior to closing,
as to the due incorporation and good standing of the Owner
Participant in such state; and
(4) a certificate signed by an authorized officer of
the Owner Participant, dated the Delivery Date, certifying
that the representations and warranties contained herein of
the Owner Participant are correct in all material respects
as though made on and as of the Delivery Date, except to the
extent that such representations and warranties relate
solely to an earlier date (in which case such
representations and warranties are correct on and as of such
earlier date).
(viii) All appropriate action required to have been taken
prior to the Delivery Date in connection with the transactions
contemplated by this Agreement shall have been taken by the Federal
Aviation Administration, or any governmental or political agency,
subdivision or instrumentality of the United States, and all orders,
permits, waivers, authorizations, exemptions and approvals of such
entities required to be in effect on the Delivery Date in connection
with the transactions contemplated by this Agreement shall have been
issued, and all such orders, permits, waivers, authorizations,
exemptions and approvals shall be in full force and effect on the
Delivery Date.
(ix) The Owner Trustee, the Owner Participant, the Indenture
Trustee, the Pass Through Trustee and the Subordination Agent shall
have received a certificate signed by an authorized officer of Lessee
to the effect that:
(1) the Aircraft has been duly certified by the
Federal Aviation Administration as to type and has a current
certificate of airworthiness;
(2) the FAA Bill of Sale, the Lease, the Lease
Supplement, the Trust Indenture and the Trust Supplement
covering the Aircraft shall have been duly filed for
recordation (or shall be in the process of being so duly
filed for recordation) with the Federal Aviation
Administration, and the Trust Agreement shall have been
filed (or shall be in the process of being so filed) with
the Federal Aviation Administration;
(3) application for registration of the Aircraft in
the name of the Owner Trustee (together with any required
affidavits) has been duly made with the Federal Aviation
Administration;
(4) the representations and warranties contained
herein of Lessee are correct in all material respects as
though made on and as of the Delivery Date, except to the
extent that such representations and warranties relate
solely to an earlier date (in which case such
representations and warranties were correct on and as of
such earlier date); and
(5) the conditions to the purchase of the Equipment
Notes by the Pass Through Trustees under the Pass Through
Documents have been duly satisfied or waived in accordance
with their respective terms.
(x) In the case of the Pass Through Trustees, the conditions
specified in Section 3 of the Note Purchase Agreement shall have been
satisfied or waived.
(xi) The Owner Trustee, the Owner Participant, the Indenture
Trustee, the Pass Through Trustee and the Subordination Agent shall
have received, addressed to each such party, and reasonably
satisfactory as to scope and substance to each addressee thereof,
opinions dated the Delivery Date substantially in the form of Exhibit
B-1 hereto from Skadden, Arps, Slate, Meagher & Flom (Illinois),
special counsel for Lessee, and an opinion dated the Delivery Date
substantially in the form of Exhibit B-2 hereto from Lessee's legal
department.
(xii) The Pass Through Trustee and the Owner Participant shall
have received, addressed to the Pass Through Trustee, the Indenture
Trustee, the Owner Participant, the Owner Trustee and Lessee and
reasonably satisfactory as to scope and substance to the Pass Through
Trustee, the Owner Participant and Lessee, an opinion dated the
Delivery Date substantially in the form of Exhibit C hereto from
Clifford Chance, with respect to the Manufacturer Documents.
(xiii) The Owner Participant, the Indenture Trustee, the Pass
Through Trustee and the Subordination Agent shall have received,
addressed to each such party, and reasonably satisfactory as to scope
and substance to each addressee thereof, an opinion dated the
Delivery Date substantially in the form of Exhibit D hereto from Ray,
Quinney & Nebeker, special counsel for the Owner Trustee.
(xiv) The Owner Trustee, the Indenture Trustee, the Pass Through
Trustee and the Subordination Agent shall have received, addressed to
each such party, and reasonably satisfactory as to scope and
substance to each addressee thereof, an opinion dated the Delivery
Date substantially in the form of Exhibit E-1 hereto from
________________, special counsel for the Owner Participant, and an
opinion dated the Delivery Date substantially in the form of Exhibit
E-2 hereto from the Owner Participant's in-house counsel.
(xv) The Owner Trustee, the Owner Participant, the Indenture
Trustee, the Pass Through Trustee and the Subordination Agent shall
have received, addressed to each such party, and reasonably
satisfactory as to scope and substance to each addressee thereof, an
opinion dated the Delivery Date substantially in the form of Exhibit F
hereto from Crowe & Dunlevy, P.C., special FAA counsel.
(xvi) The Owner Trustee, the Owner Participant, the Pass Through
Trustee and the Subordination Agent shall have received, addressed to
each such party, and reasonably satisfactory as to scope and
substance to each addressee thereof, an opinion dated the Delivery
Date substantially in the form of Exhibit G from Bingham Dana LLP,
special counsel for the Indenture Trustee.
(xvii) [Reserved.]
(xviii) The Owner Trustee, the Owner Participant, the Indenture
Trustee, the Pass Through Trustee and the Subordination Agent shall
have received an insurance certificate together with an independent
insurance broker's report, in form and substance satisfactory to the
Owner Participant, as to the due compliance with the terms of Section
11 of the Lease relating to insurance with respect to the Aircraft.
(xix) The Owner Participant shall have received an appraisal
dated the Delivery Date from ______________ in form and substance
satisfactory to it.
(xx) No action or proceeding shall have been instituted nor shall
governmental action be threatened before any court or governmental
agency, nor shall any order, judgment or decree have been issued or
proposed to be issued by any court or governmental agency at the time
of the Delivery Date to set aside, restrain, enjoin or prevent the
completion and consummation of this Agreement or the transactions
contemplated hereby.
(xxi) The Owner Participant shall have received from
____________________, special tax counsel to the Owner Participant, a
favorable opinion, in form and substance satisfactory to the Owner
Participant, with respect to certain Federal income tax aspects of
the transaction contemplated by the Operative Documents.
(xxii) There shall have been, since the date hereof, no
amendment, modification, addition, or change in or to the provisions
of the Code, the regulations promulgated under the Code (including
temporary regulations), Internal Revenue Service Revenue Procedures
or Revenue Rulings, or other administrative interpretations,
applicable judicial precedents or Executive Orders of the President
of the United States, all as in effect on the date hereof, the effect
of which might preclude the Owner Participant from obtaining any of
the anticipated income tax benefits with respect to the Aircraft.
(xxiii) The Owner Trustee, the Owner Participant, the Indenture
Trustee and the Subordination Agent, shall have received (A) a
certificate signed by an authorized officer of the Pass Through
Trustee, dated the Delivery Date, certifying that the representations
and warranties contained herein of the Pass Through Trustee are
correct as though made on and as of the Delivery Date, except to the
extent that such representations and warranties relate solely to an
earlier date (in which case such representations and warranties are
correct on and as of such earlier date), (B) an opinion dated the
Delivery Date substantially in the form of Exhibit H hereto addressed
to each such party of Bingham Dana LLP, special counsel for the Pass
Through Trustee, and reasonably satisfactory as to scope and
substance to each addressee thereof, and (C) such other documents and
evidence with respect to the Pass Through Trustee as it may
reasonably request in order to establish the due consummation of the
transactions contemplated by this Agreement, the taking of all
necessary corporate action in connection therewith and compliance
with the conditions herein set forth.
(xxiv) No Lease Event of Default has occurred and is continuing
and no Event of Loss has occurred with respect to the Airframe or any
Engine.
(xxv) The Owner Trustee, the Owner Participant, the Indenture
Trustee and the Pass Through Trustee shall have received, addressed
to each such party, and reasonably satisfactory as to scope and
substance, to each addressee thereof, an opinion dated the Delivery
Date substantially in the form of Exhibit I from Bingham Dana LLP,
special counsel for the Subordination Agent.
Promptly upon the registration of the Aircraft and the recording of
the Trust Indenture, the Lease, the Lease Supplement covering the Aircraft
and the Trust Supplement covering the Aircraft pursuant to the
Transportation Code, Lessee will cause Crowe & Dunlevy, P.C., special FAA
counsel in Oklahoma City, Oklahoma, to deliver to the Pass Through Trustee,
the Indenture Trustee, the Owner Participant, the Owner Trustee and Lessee
an opinion as to the due and valid registration of the Aircraft in the name
of the Owner Trustee, the due recording of the FAA Bill of Sale, the Trust
Indenture, such Lease Supplement, such Trust Supplement and the Lease and
the filing of the Trust Agreement and the lack of filing of any intervening
documents with respect to the Aircraft.
(b) Conditions Precedent to the Obligations of Lessee. It is
agreed that (A) the obligations of Lessee to sell the Aircraft to the Owner
Trustee and to accept delivery of the Aircraft under the Lease on the
Delivery Date, and (B) the obligations of Lessee to enter into the other
Operative Documents on the Delivery Date are all subject to the fulfillment
to the satisfaction of Lessee prior to the Delivery Date of the following
conditions precedent:
(i) All appropriate action required to have been taken on or
prior to the Delivery Date in connection with the transactions
contemplated by this Agreement shall have been taken by the Federal
Aviation Administration, or any governmental or political agency,
subdivision or instrumentality of the United States, and all orders,
permits, waivers, exemptions, authorizations and approvals of such
entities required to be in effect on the Delivery Date in connection
with the transactions contemplated by this Agreement shall have been
issued, and all such orders, permits, waivers, exemptions,
authorizations and approvals shall be in full force and effect on the
Delivery Date.
(ii) The conditions specified in Sections 4(a)(ii), 4(a)(iii) and
4(a)(iv) hereof shall have been satisfied.
(iii) Those documents described in Section 4(a)(v) shall have
been duly authorized, executed and delivered by the respective party
or parties thereto (other than Lessee) in the manner specified in
Section 4(a)(v), shall each be satisfactory in form and substance to
Lessee, shall be in full force and effect on the Delivery Date, and
an executed counterpart of each thereof (other than the Equipment
Notes) shall have been delivered to Lessee or its special counsel.
(iv) Lessee shall have received (A) each certificate referred to
in Section 4(a)(vii) (other than the certificate and documents
referred to in clause (A) thereof), (B) the certificate referred to in
Section 4(a)(xxiii)(A), and (C) such other documents and evidence with
respect to the Pass Through Trustee as Lessee or its special counsel
may reasonably request in order to establish the due consummation of
the transactions contemplated by this Agreement, the taking of all
corporate proceedings in connection therewith and compliance with the
conditions herein set forth.
(v) Lessee shall have received the opinions set forth in
Sections 4(a)(xii), 4(a)(xiii), 4(a)(xiv), 4(a)(xv), 4(a)(xvi),
4(a)(xxv), and 4(a)(xxiii)(B) in each case addressed to Lessee and
dated the Delivery Date and in each case in scope and substance
reasonably satisfactory to Lessee and its special counsel.
(vi) No action or proceeding shall have been instituted nor shall
governmental action be threatened before any court or governmental
agency, nor shall any order, judgment or decree have been issued or
proposed to be issued by any court or governmental agency at the time
of the Delivery Date to set aside, restrain, enjoin or prevent the
completion and consummation of this Agreement or the transactions
contemplated hereby.
(vii) No change shall have occurred after the date of the
execution and delivery of this Agreement in applicable law or
regulations or guidelines or interpretations by appropriate
regulatory authorities which would make it a violation of law or
regulations or guidelines for Lessee to enter into any transaction
contemplated by the Operative Documents.
(viii) There shall have been, since the date hereof, no
amendment, modification, addition or change in or to the Code, the
regulations promulgated under the Code (including temporary
regulations), Internal Revenue Service Revenue Procedures or Revenue
Rulings, or other administrative interpretations, applicable judicial
precedents or Executive Orders of the President of the United States
which might give rise to an indemnity obligation of Lessee under any
of the Operative Documents.
(ix) Lessee shall have been paid Lessor's Cost for the Aircraft.
SECTION 5. EXTENT OF INTEREST OF NOTE HOLDERS. No Note Holder
shall have any further interest in, or other right with respect to, the
mortgage and security interests created by the Trust Indenture when and if
the principal of and interest on all Equipment Notes held by such holder
and all other sums payable to such holder hereunder, under the Trust
Indenture and under such Equipment Notes shall have been paid in full.
Each Pass Through Trustee and, by its acceptance of a Equipment Note, each
Note Holder agrees that it will look solely to the income and proceeds from
the Trust Indenture Estate to the extent available for distribution to such
Note Holder as provided in Article III of the Trust Indenture and that
neither the Owner Participant nor the Owner Trustee shall be personally
liable to the Pass Through Trustees or any Note Holder for any amounts
payable under the Equipment Notes, the Trust Indenture or hereunder, except
as expressly provided in the Operative Documents.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF LESSEE; INDEMNITIES.
(a) Representations and Warranties. Lessee represents and
warrants to the Pass Through Trustee, the Owner Trustee, the Indenture
Trustee, each Liquidity Provider, the Subordination Agent and the Owner
Participant that:
(i) Lessee is a corporation duly organized, validly existing and
in good standing under the laws of the state of its incorporation, has
the corporate power and authority to own or hold under lease its
properties, has, or had on the respective dates of execution thereof,
the corporate power and authority to enter into and perform its
obligations under the Lessee Documents, the Pass Through Trust
Agreements and the other Operative Documents to which it is a party,
and is duly qualified to do business as a foreign corporation in each
state in which its operations or the nature of its business requires
other than failures to so qualify which would not have a material
adverse effect on the condition (financial or otherwise), business or
properties of Lessee and its subsidiaries considered as one
enterprise;
(ii) Lessee is a Certificated Air Carrier, and its chief
executive office (as such term is used in Article 9 of the Uniform
Commercial Code in effect in the State of Virginia) is located at
Arlington, Virginia;
(iii) the execution and delivery by Lessee of the Lessee
Documents, the Pass Through Trust Agreements and each other Operative
Document to which Lessee is a party, and the performance of the
obligations of Lessee under the Lessee Documents, the Pass Through
Trust Agreements and each other Operative Document to which Lessee is
a party, have been duly authorized by all necessary corporate action
on the part of Lessee, do not require any stockholder approval, or
approval or consent of any trustee or holder of any material
indebtedness or material obligations of Lessee, except such as have
been duly obtained and are in full force and effect, and do not
contravene any law, governmental rule, regulation or order binding on
Lessee or the certificate of incorporation or by-laws of Lessee, or
contravene the provisions of, or constitute a default under, or
result in the creation of any Lien (other than Permitted Liens) upon
the property of Lessee under, any indenture, mortgage, contract or
other agreement to which Lessee is a party or by which it may be
bound or affected which contravention, default or Lien, individually
or in the aggregate, would be reasonably likely to have a material
adverse effect on the condition (financial or otherwise), business or
properties of Lessee and its subsidiaries considered as one
enterprise provided, that insofar as the representations and
warranties set forth in this Section 6(a)(iii) apply to the
prohibited transaction rules of ERISA and Section 4975 of the Code,
such representations and warranties are based upon and subject to the
truth and accuracy of the representations, warranties and covenants
set forth in Section 7(n) and the representations and warranties made
or deemed made by each purchaser of Certificates issued by a Pass
Through Trust;
(iv) neither the execution and delivery by Lessee of the Lessee
Documents, the Pass Through Trust Agreements or any other Operative
Document to which Lessee is a party, nor the performance of the
obligations of Lessee under the Lessee Documents, the Pass Through
Trust Agreements or the other Operative Documents to which Lessee is
a party, requires the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action in
respect of, the Department of Transportation, the FAA, or any other
Federal, state or foreign governmental authority having jurisdiction
over Lessee, other than (A) the registration of the Pass Through
Trust Certificates under the Securities Act and under the securities
laws of any state in which the Pass Through Trust Certificates may be
offered for sale if the laws of such state require such action, (B)
the qualification of the Pass Through Trust Agreements under the
Trust Indenture Act of 1939, as amended, pursuant to an order of the
Securities and Exchange Commission, (C) the orders, permits, waivers,
exemptions, authorizations and approvals of the regulatory
authorities having jurisdiction over the operation of the Aircraft by
Lessee or any Sublessee required to be obtained on or prior to the
Delivery Date, which orders, permits, waivers, exemptions,
authorizations and approvals have been, or on the Delivery Date will
be, duly obtained and are, or on the Delivery Date will be, in full
force and effect, (D) the application for registration of the
Aircraft referred to in Section 4(a)(ix)(3), (E) the registrations
and filings referred to in Section 6(a)(vi), and (F) authorizations,
consents, approvals, actions, notices and filings required to be
obtained, taken, given or made either only after the date hereof or
the failure of which to obtain, take, give or make would not be
reasonably likely to have a material adverse effect on the condition
(financial or otherwise), business or properties of Lessee and its
subsidiaries considered as one enterprise;
(v) this Agreement, each of the other Lessee Documents and the
Pass Through Trust Agreements to which Lessee is a party constitute
(or, in the case of documents to be executed on the Delivery Date,
will constitute) the legal, valid and binding obligations of Lessee
enforceable against Lessee in accordance with their respective terms,
except as the same may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws affecting the rights of creditors or lessors generally
and by general principles of equity, whether considered in a
proceeding at law or in equity, and except, in the case of the Lease,
as limited by applicable laws which may affect the remedies provided
in the Lease;
(vi) except for (A) the filing of the Trust Agreement with the
FAA, (B) the registration of the Aircraft pursuant to the
Transportation Code, (C) the filing for recording pursuant to the
Transportation Code of the Lease with the Lease Supplement covering
the Aircraft, the Trust Indenture and the Trust Supplement attached
thereto and made a part thereof, the Trust Indenture with the Trust
Supplement attached thereto and made a part thereof and the FAA Bill
of Sale, (D) the filing of financing statements (and continuation
statements at periodic intervals) with respect to the security
interests created by such documents under the Uniform Commercial Code
of Virginia and Utah and such other states as may be specified in the
opinion furnished pursuant to Section 4(a)(xi) hereof, and (E) the
taking of possession by the Indenture Trustee of the original chattel
paper counterpart of each of the Lease and the Lease Supplement
covering the Aircraft, no further filing or recording of any document
(including any financing statement in respect thereof under Article 9
of the Uniform Commercial Code of any applicable jurisdiction) or
other action is necessary under the laws of the United States of
America or any State thereof in order to perfect the Owner Trustee's
title to and interest in the Aircraft as against Lessee and any third
parties, or to perfect the security interest in favor of the Indenture
Trustee in the Owner Trustee's interest in the Aircraft (with respect
to such portion of the Aircraft as is covered by the recording system
established by the FAA pursuant to 49 U.S.C. Section 44107) and in the
Lease in any applicable jurisdiction in the United States;
(vii) neither Lessee nor any of its Affiliates has directly or
indirectly offered any interest in the Trust Estate, the Equipment
Notes or the Pass Through Trust Certificates for sale to any Person
other than in a manner permitted by the Securities Act and by the
rules and regulations thereunder;
(viii) Lessee is not an "investment company" within the meaning
of the Investment Company Act of 1940, as amended;
(ix) no event has occurred and is continuing which constitutes a
Lease Default or Lease Event of Default;
(x) no event has occurred and is continuing which constitutes an
Event of Loss or would constitute an Event of Loss with the lapse of
time;
(xi) Lessee is solvent and will not be rendered insolvent by the
sale of the Aircraft; after the sale of the Aircraft the capital of
Lessee will not be unreasonably small for the conduct of the business
in which Lessee is engaged or is about to engage; Lessee has no
intention or belief that it is about to incur debts beyond its ability
to pay as they mature; and Lessee's sale of the Aircraft is made
without any intent to hinder, delay or defraud either present or
future creditors;
(xii) none of the proceeds from the issuance of the Equipment
Notes or from the acquisition by the Owner Participant of its
beneficial interest in the Trust Estate will be used directly or
indirectly by Lessee to purchase or carry any "margin security" as
such term is defined in Regulation U of the Board of Governors of the
Federal Reserve System;
(xiii) on the Delivery Date, all sales or use tax then due and
for which Lessee is responsible pursuant to Section 6(b)(i) hereof
shall have been paid, other than such taxes which are being contested
by Lessee in good faith and by appropriate proceedings so long as
such proceedings do not involve any material risk of the sale,
forfeiture or loss of the Aircraft;
(xiv) except as may have been disclosed in the Lessee's reports
filed with the Securities and Exchange Commission, there are no
pending or threatened actions or proceedings that individually or in
the aggregate which could be expected to have a material adverse
effect on the condition (financial or otherwise), business or
properties of Lessee and its subsidiaries considered as one
enterprise; and
(xv) the Owner Trustee will receive good and marketable title to
the Aircraft from Lessee free and clear of all Liens, except the
rights of Lessee under the Lease and the Lease Supplement covering the
Aircraft, the Lien of the Trust Indenture, the beneficial interest of
the Owner Participant in the Aircraft, and the Liens permitted by
clause (iv) (solely for Taxes not yet due but excluding any such Taxes
being contested) and clause (v) of Section 6 of the Lease (solely
securing obligations that are not yet due, but excluding any such
obligations being contested).
(b) General Tax Indemnity.
(i) Indemnity. Except as provided in Section 6(b)(ii) hereof,
Lessee hereby agrees to indemnify, protect, defend and hold harmless
each Indemnitee on an after-tax basis for all Taxes imposed by the
United States or any state, local or foreign government or taxing
authority upon or with respect to (A) the Aircraft, (B) the
manufacture, ownership, delivery, lease, sale, alteration, change in
registration, sublease, possession, use, operation, condition,
maintenance, financing, inspection, overhaul, testing, modification,
storage, manufacture, purchase, acceptance, rejection, or registration
of the Aircraft, (C) the rentals or receipts from the Aircraft, (D)
the payments made pursuant to any of the Operative Documents, (E) the
interest and principal paid with respect to the Equipment Notes and
(F) the income or proceeds from the property held in the Trust Estate
or the Trust Indenture Estate.
(ii) Exclusions from General Tax Indemnity. The provisions of
Section 6(b)(i) shall not apply to:
(1) Taxes on, based on, measured by or with respect to
the gross or net income, gross or net receipts, minimum or
alternative taxes, tax preferences, capital, net worth,
franchise or conduct of business (but not excluding sales,
use, license, rental, ad valorem, value added tax (to the
extent that such value added tax is not imposed as a
substitute for an income tax) or property taxes) (a) imposed
by the United States or by any state or local government or
taxing authority or (b) imposed by any foreign government or
taxing authority except where such Tax is imposed by reason
of the use, location, registration, subleasing, leasing or
operation of the Aircraft or the presence or activities of
Lessee in such jurisdiction and exceeds the Tax that would
have been imposed on the Indemnitee regardless of the use,
location, registration, subleasing, leasing or operation of
the Aircraft or the presence or activities of Lessee;
(2) Taxes that would not have been imposed but for a
Lessor's Lien;
(3) Taxes resulting from a voluntary transfer by the
Owner Participant of the Aircraft, the Trust Estate, or the
Operative Documents, or any interest therein, or a transfer
relating to bankruptcy or similar proceedings involving the
Owner Participant;
(4) Taxes resulting from the willful misconduct or
negligence of the Indemnitees;
(5) Taxes imposed with respect to any period after the
expiration of the Lease or the earlier discharge in full of
Lessee's obligation to pay Termination Value;
(6) Taxes imposed on any transferee (a) if such Tax
would not have been imposed on the original Indemnitee, or
(b) to the extent such Tax exceeds the amount of Tax that
would have been imposed on the original Indemnitee;
(7) Taxes which have been included in the Lessor's
Cost;
(8) Taxes imposed by a government or taxing authority
of any jurisdiction that would have been imposed on the
Indemnitee for activities or property in such jurisdiction
unrelated to the transactions contemplated by the Operative
Documents;
(9) Taxes being contested pursuant to the contest
provisions contained in Section 6(b)(iv);
(10) Taxes imposed on the Owner Trustee or the Owner
Participant based on, measured by or imposed with respect to
any fees, commissions or compensation received by it;
(11) Taxes imposed on the Owner Participant and
indemnified under the Tax Indemnity Agreement;
(12) Interest, penalties and additions to Tax to the
extent imposed as a result of the failure of the Owner
Participant to timely and properly file any return, unless
such failure is caused by Lessee's failure to timely provide
information required to be provided under the Operative
Documents;
(13) Taxes that would not have been imposed but for an
Indemnitee's breach of any covenant or the inaccuracy of any
representation or warranty of such Indemnitee in any of the
Operative Documents;
(14) Taxes in the nature of an intangible or similar
Tax imposed upon, or with respect to, (a) the value of the
Owner Participant's interest in the Trust or the Indenture
Trust or (b) the value or the principal amount of any
Lender's interest in any of the Equipment Notes;
(15) U.S. withholding taxes imposed on payments to a
foreign person; and
(16) Taxes imposed by section 4975 of the Code or any
successor provision thereto.
References to the Owner Participant shall include such Person's
respective successors and permitted assigns, officers, directors, servants,
employees, agents and Affiliates.
(iii) Payments. The Lessee's indemnity obligation to an
Indemnitee under this Section 6(b) shall include any amount necessary
to hold such Indemnitee harmless (as determined in good faith by such
Indemnitee), after taking into account any tax benefits actually
realized by such Indemnitee (including, without limitation, any
benefits realized as a result of an indemnifiable Tax being utilized
by such Indemnitee as a credit against Taxes not indemnifiable under
this Section 6(b)), from the net amount of all Taxes actually
required to be paid by such Indemnitee by reason of the receipt or
accrual of the amounts payable under this Section 6(b). Each
Indemnitee shall provide Lessee with such certifications, information
and documentation as shall be reasonably requested by Lessee to
minimize any indemnity payment pursuant to this Section 6(b). At
Lessee's request, the computation of the amount of any indemnity
payment owed by Lessee or any amount owed by an Indemnitee to Lessee
pursuant to this Section 6(b) shall be verified and certified by a
nationally recognized independent public accounting firm selected by
the Indemnitee and reasonably acceptable to Lessee. The costs of such
verification (including the fee of such public accounting firm) shall
be borne by Lessee unless such verification shall result in an
adjustment in Lessee's favor of 5% or more of the net present value
of the payment as computed by such Indemnitee, in which case the
costs shall be paid by such Indemnitee.
Each Indemnitee shall promptly forward to Lessee any written notice,
bill or advice received by it from any government or taxing authority
concerning any Tax for which it seeks indemnification under this Section
6(b); provided, however, the failure to provide such notice shall not
adversely affect such Indemnitee's right to indemnity under this Section
6(b) except to the extent such failure materially adversely affects the
contest of the Tax. The Lessee shall pay any amount for which it is liable
pursuant to this Section 6(b) directly to the appropriate government or
taxing authority if legally permissible or, upon demand of an Indemnitee,
to such Indemnitee within 30 days of such demand (or, if a contest occurs
in accordance with Section (6)(b)(iv), within 30 days after a Final
Determination (as defined below)), but in no event more than one business
day prior to the date the Tax to which such amount payable hereunder
relates is due, provided, Lessee shall not be required to make any payment
pursuant to this Section 6(b)(iii) unless the Indemnitee elects to pay such
Tax claimed and sue for a refund as provided in Section 6(b)(iv). If
requested by an Indemnitee in writing, Lessee shall furnish to the
appropriate Indemnitee the original or a certified copy of a receipt for
Lessee's payment of any Tax or such other evidence of payment of Tax. For
purposes of this Section 6(b), a "Final Determination" shall mean (A) a
decision, judgment, decree or other order by any court of competent
jurisdiction that occurs pursuant to the provisions of Section 6(b)(iv),
which decision, judgment, decree or other order has become final and
unappealable, (B) a closing agreement or settlement agreement entered into
in accordance with Section 6(b)(iv) that has become binding and is not
subject to further review or appeal absent fraud or misrepresentation or
(C) the termination of administrative proceedings and the expiration of the
time for instituting a claim in a court proceeding.
If any Indemnitee shall actually realize a tax savings by reason of
any Tax paid or indemnified by Lessee pursuant to this Section 6(b) and
such savings was not otherwise taken into account in computing such payment
or indemnity, such Indemnitee shall pay to Lessee an amount equal to the
lesser of (A) the amount of such tax savings, plus any additional tax
savings actually realized as the result of any payment made pursuant to
this sentence and (B) the amount of all payments made by Lessee to such
Indemnitee (reduced by any payments previously made by such Indemnitee to
Lessee pursuant to this Section 6(b)), and the excess, if any, of the
amount described in clause (A) over the amount described in clause (B)
shall be carried forward and applied to reduce pro tanto any subsequent
obligations of Lessee to make payments to such Indemnitee pursuant to this
Section 6(b)). No Indemnitee shall have any obligation to make any payment
while a Lease Event of Default has occurred and is continuing.
Any Taxes that are imposed on any Indemnitee as a result of the
disallowance or reduction of any tax benefit referred to in this Section
6(b) pursuant to a Final Determination by a tax authority as to which such
Indemnitee has made the payment to Lessee required hereby or which tax
benefit was otherwise taken into account in computing Lessee's indemnity
obligation pursuant to this Section 6(b) in a taxable year subsequent to
the utilization by such Indemnitee shall be treated as a Tax for which
Lessee is obligated to indemnify pursuant to this Section 6(b).
(iv) Contests. If a written claim is made against an Indemnitee
or if any proceeding is commenced against an Indemnitee (including a
written notice of such proceeding) for Taxes as to which Lessee could
be liable for payment or indemnity hereunder, or if an Indemnitee
makes a determination that a Tax is due for which Lessee could have
an indemnity obligation hereunder, such Indemnitee shall promptly
give Lessee notice in writing of such claim (provided, however, that
the failure to provide such notice shall not affect Lessee's
obligations hereunder to the Owner Participant unless such failure
shall materially adversely affect the right to contest such claim)
and shall not take any action with respect to such claim or Tax
without the consent of Lessee for 30 days following the receipt of
such notice by Lessee; provided, however, that, if such Indemnitee
shall be required by law to take action prior to the end of such
30-day period, such Indemnitee shall, in such notice to Lessee, so
inform Lessee, and such Indemnitee shall take no action for as long
as it is legally able to do so (it being understood that an
Indemnitee shall be entitled to pay the Tax claimed and sue for a
refund prior to the end of such 30-day period if (A)(I) the failure
to so pay the Tax would result in substantial penalties (unless
immediately reimbursed by Lessee) and the act of paying the Tax would
not prejudice the right to contest or (II) the failure to so pay
would result in criminal penalties and (B) such Indemnitee shall act
in connection with paying the Tax in the manner that is the least
prejudicial to the pursuit of the contest). In addition, such
Indemnitee shall (provided that Lessee shall have agreed to keep such
information confidential other than to the extent necessary in order
to contest the claim) furnish Lessee with copies of any requests for
information from any taxing authority relating to such Taxes with
respect to which Lessee may be required to indemnify hereunder. If
requested by Lessee in writing within 30 days after its receipt of
such notice, such Indemnitee shall, at the expense of Lessee
(including all reasonable out-of-pocket costs and reasonable attorney
and accountants fees), in good faith contest (or, if permitted by
applicable law, allow Lessee to contest) through appropriate
administrative and judicial proceedings the validity, applicability
or amount of such Taxes by (X) resisting payment thereof, (Y) not
paying the same except under protest if protest is necessary and
proper or (Z) if the payment is made, using reasonable efforts to
obtain a refund thereof in an appropriate administrative and/or
judicial proceeding. If requested to do so by Lessee, the Indemnitee
shall appeal any adverse administrative or judicial decision, except
that the Indemnitee shall not be required to pursue any appeals to
the United States Supreme Court. If and to the extent the Indemnitee
is able to separate the contested issue or issues from other issues
arising in the same administrative or judicial proceeding that are
unrelated to the transactions contemplated by the Operative Documents
without, in the good faith judgment of such Indemnitee, adversely
affecting such Indemnitee, such Indemnitee shall permit Lessee to
control the conduct of any such proceeding and shall provide to
Lessee such information or data that is in such Indemnitee's control
or possession that is reasonably necessary to conduct such contest.
In the case of a contest controlled by an Indemnitee, such Indemnitee
shall consult with Lessee in good faith regarding the manner of
contesting such claim and shall keep Lessee reasonably informed
regarding the progress of such contest. An Indemnitee shall not fail
to take any action expressly required by this Section 6(b)(iv)
(including, without limitation, any action regarding any appeal of an
adverse determination with respect to any claim) or settle or
compromise any claim without the prior written consent of Lessee
(except as contemplated by this Section 6(b)(iv)).
Notwithstanding the foregoing, in no event shall an Indemnitee be
required to pursue any contest (or to permit Lessee to pursue any contest)
unless (A) Lessee shall have agreed to pay such Indemnitee on demand all
reasonable out-of-pocket costs and reasonable attorney and accountants fees
that such Indemnitee shall incur in connection with contesting such claim,
(B) if such contest shall involve the payment of the claim, Lessee shall
advance the amount thereof plus (to the extent indemnified hereunder)
interest, penalties and additions to tax with respect thereto that are
required to be paid prior to the commencement of such contest on an
interest-free basis and with no additional net after-tax cost to such
Indemnitee (and such Indemnitee shall promptly pay to Lessee any net
realized tax benefits resulting from any imputed interest deduction arising
from such interest free advance from Lessee plus any tax benefits resulting
from making any such payment), (C) such Indemnitee shall have reasonably
determined that the action to be taken will not result in any material risk
of forfeiture, sale or loss of the Aircraft (unless Lessee shall have made
provisions to protect the interests of any such Indemnitee), (D) no Lease
Event of Default shall have occurred and be continuing at the time the
contest is begun unless Lessee has provided security for its obligations
hereunder by advancing to such Indemnitee before proceeding with such
contest, the amount of the Tax being contested, plus any interest and
penalties and an amount estimated in good faith by such Indemnitee for
reasonable expenses, and (E) in the case of a contest that is being pursued
by an Indemnitee, the aggregate amount of the claim (together with the
amount of all similar or logically related claims that have been or could
be raised with any or all of the other Aircraft leased by the Owner
Participant to Lessee or raised in any other audit for which Lessee would
have an indemnity obligation under this Section 6(b)(iv)) is at least
$3,000. Notwithstanding the foregoing, if any Indemnitee shall release,
waive, compromise or settle any claim which may be indemnifiable by Lessee
pursuant to this Section 6(b) without the written permission of Lessee,
Lessee's obligation to indemnify such Indemnitee with respect to such claim
(and all directly related claims and claims based on the outcome of such
claim) shall terminate, subject to this Section 6(b)(iv), and subject to
Section 6(b)(iii), such Indemnitee shall repay to Lessee any amount
previously paid or advanced to such Indemnitee with respect to such claim,
plus interest at the rate that would have been payable by the relevant
taxing authority with respect to a refund of such Tax.
Notwithstanding anything contained in this Section 6(b), an Indemnitee
will not be required to contest the imposition of any Tax and shall be
permitted to settle or compromise any claim without Lessee's consent if
such Indemnitee (A) shall waive its right to indemnity under this Section
6(b), with respect to such Tax (and any directly related claim and any
claim the outcome of which is determined based upon the outcome of such
claim) and (B) shall pay to Lessee any amount previously paid or advanced
by Lessee pursuant to this Section 6(b) with respect to such Tax, plus
interest at the rate that would have been payable by the relevant taxing
authority with respect to a refund of such Tax.
(v) Refunds. If any Indemnitee shall receive a refund or credit
(or would have received such refund or credit but for a counterclaim
or other claim not indemnified by Lessee hereunder (a "deemed refund
or credit")) with respect to all or any part of any Taxes paid,
reimbursed or advanced by Lessee, in each case, whether by means of a
deduction, credit, refund or otherwise, and which was not taken into
account in computing such payment or indemnity, such Indemnitee shall
pay to Lessee within 30 days of such receipt or, in the case of a
deemed refund or credit, within 30 days of the resolution of such
contest, an amount equal to the lesser of (A) the amount of such
refund or credit or deemed refund or credit actually realized by such
Indemnitee, plus any additional tax savings actually realized by such
Indemnitee as a result of any payment made pursuant to this sentence
(including clause (A)), and (B) such tax payment, reimbursement or
advance by Lessee to such Indemnitee theretofore made pursuant to this
Section 6(b) and the excess, if any, of the amount described in clause
(A) over the amount described in clause (B) shall be carried forward
and applied to reduce pro tanto any subsequent obligations of Lessee
to make payments to such Indemnitee pursuant to this Section 6(b)).
If, in addition to such refund or credit (or deemed refund or credit),
such Indemnitee shall receive or be credited with (or would have
received but for a counterclaim or other claim not indemnified by
Lessee hereunder) an amount representing interest on the amount of
such refund or credit or deemed refund or credit, as the case may be,
such Indemnitee shall pay to Lessee within 30 days of such receipt or,
in the case of a deemed refund or credit, within 30 days of the
resolution or such contest, that portion of such interest that shall
be fairly attributable to Taxes paid, reimbursed or advanced by Lessee
prior to the receipt of such refund or credit or deemed refund or
credit. Each Indemnitee agrees to reasonably cooperate with Lessee in
claiming and pursuing any such refunds or credits of any Taxes payable
or indemnifiable pursuant to this Section 6(b).
(vi) Tax Filing. If any report, return or statement is required
to be filed with respect to any Tax which is subject to
indemnification under this Section 6(b), Lessee shall timely file the
same (except for any such report, return or statement which an
Indemnitee has timely notified Lessee in writing that such Indemnitee
intends to file, or for which such Indemnitee is required by law to
file, in its own name); provided, that the relevant Indemnitee shall
furnish Lessee with any information in such Indemnitee's possession
or control that is reasonably necessary to file any such return,
report or statement and is reasonably requested in writing by Lessee,
but in no event shall be obligated to furnish tax returns, although
it may be required to furnish relevant information contained therein.
The Lessee shall either file such report, return or statement and
send a copy of such report, return or statement to such Indemnitee,
and the Owner Trustee if the Indemnitee is not the Owner Trustee, or,
where Lessee is not permitted to file such report, return or
statement, it shall notify such Indemnitee of such requirement and
prepare and deliver such report, return or statement to such
Indemnitee in a manner satisfactory to such Indemnitee within a
reasonable time prior to the time such report, return or statement is
to be filed.
(vii) Forms. Each Indemnitee agrees to furnish from time to time
to Lessee or the Indenture Trustee or to such other Person as Lessee
or the Indenture Trustee may designate, at Lessee's or the Indenture
Trustee's request, such duly executed and properly completed forms as
may be necessary or appropriate in order to claim any reduction of or
exemption from any withholding or other Tax imposed by any government
or taxing authority, if (A) such reduction or exemption is available
to such Indemnitee and (B) Lessee has provided such Indemnitee with
any information necessary to complete such form not otherwise
reasonably available to such Indemnitee.
(viii) Non-Parties. If an Indemnitee is not a party to this
Agreement, Lessee may require the Indemnitee to agree in writing, in
a form reasonably acceptable to Lessee, to the terms of this Section
6(b) prior to making any payment to such Indemnitee under this
Section 6(b).
(ix) Subrogation. Upon payment of any Tax by Lessee pursuant to
this Section 6(b) to or on behalf of an Indemnitee, Lessee, without
any further action, shall be subrogated to any claims that such
Indemnitee may have relating thereto. Such Indemnitee shall cooperate
with Lessee to permit Lessee to pursue such claims.
(c) General Indemnity. Lessee hereby agrees to indemnify each
Indemnitee against, and agrees to protect, save and keep harmless each of
them from (whether or not the transactions contemplated herein or in any of
the other Operative Documents are consummated), any and all Expenses
imposed on, incurred by or asserted against any Indemnitee, in any way
relating to, based on or arising out of (A) the execution, delivery and
performance of the Operative Documents or the Pass Through Documents and
the transactions contemplated thereby; (B) the manufacture, purchase,
acceptance or rejection of the Airframe or any Engine or Parts; (C) the
Aircraft (or any portion thereof) or any engine installed on the Airframe
or any airframe on which an Engine is installed whether or not arising out
of the manufacture, purchase, registration, reregistration, financing,
refinancing, ownership, delivery, nondelivery, inspection, lease, sublease,
possession, storage, use or non-use, operation, maintenance, overhaul,
modification, alteration, condition, replacement, repair, substitution,
sale, return or other disposition of the Aircraft including, without
limitation, any violation of law relating to the Aircraft (including
environmental laws), latent or other defects, whether or not discoverable,
strict tort liability and any claim for patent, trademark or copyright
infringement; (D) the offer or sale of any interest in the Trust Estate or
the Trust Agreement or any similar interest on or prior to the Delivery
Date (including any violation of securities laws or ERISA); or (E) the
offer or sale of any interest in the Equipment Notes or the Pass Through
Certificates (or other evidence of the debt relating to the Aircraft) on
the Delivery Date or in connection with a refinancing in accordance with
the terms hereof (including any violation of securities laws or ERISA);
provided, that the foregoing indemnity shall not extend to an Indemnitee
with respect to any Expense to the extent such Expense is attributable to
one or more of the following: (1) any representation or warranty by such
Indemnitee in the Operative Documents or the Pass Through Documents being
incorrect, or (2) the failure by such Indemnitee to perform or observe any
of its agreements, covenants or conditions in any of the Operative
Documents or the Pass Through Documents, or (3) the willful misconduct or
the gross negligence of such Indemnitee, or (4) (A) in the case of any
Indemnitee, the offer, sale or other disposition (voluntary or involuntary)
by such Indemnitee of all or any part of its interest in the Airframe or
any Engine (other than during the continuance of a Lease Event of Default
or pursuant to and in accordance with Sections 9, 10, 15 or 19 of the
Lease), (B) in the case of a Note Holder, the offer, sale or other
disposition (voluntary or involuntary) by such Note Holder of all or any
part of its interest in any Equipment Note or (C) in the case of any
Indemnitee, the offer, sale or other disposition by such Indemnitee of all
or any part of such Indemnitee's interest in the Operative Documents, or
(5) any Tax (other than taxes under ERISA or Section 4975 of the Code that
are not excluded from the foregoing indemnity by reason of clause 18 below)
whether or not Lessee is required to indemnify for such Tax pursuant to
Section 6(b) hereof (it being understood that Section 6(b) hereof and the
Tax Indemnity Agreement exclusively provide for Lessee's liability with
respect to Taxes), or (6) in the case of the Owner Participant, the offer
or sale by the Owner Participant after the Delivery Date of any interest in
the Trust Estate or the Trust Agreement or any similar interest except
during the continuance of an Event of Default so long as such disposition
is made in accordance with Section 7(k), or (7) in the case of the Owner
Trustee in its individual and trust capacities, and the Affiliates,
successors and assigns thereof, a failure on the part of the Owner Trustee
to distribute in accordance with the Trust Agreement any amounts
distributable by it thereunder, or (8) in the case of the Indenture Trustee
in its individual and trust capacities, failure on the part of the
Indenture Trustee to distribute in accordance with the Trust Indenture any
amounts distributable by it thereunder, or (9) in the case of any Pass
Through Trustee, failure on the part of such Pass Through Trustee or the
Subordination Agent to distribute in accordance with the Intercreditor
Agreement and the Pass Through Trust Agreement amounts received and
distributable thereunder, or (10) the authorization or giving or
withholding of any future amendments, supplements, waivers or consents with
respect to any of the Operative Documents which amendments, supplements,
waivers or consents (a) are not or were not requested by Lessee or (b) are
not occasioned by a specific requirement of the Operative Documents, or
(11) except to the extent fairly attributable to acts or events occurring
during the Term or actions taken (or required to be taken and not taken)
during the Term, actions taken (or required to be taken and not taken) or
events occurring after the earlier of: (I) the return of possession of the
Aircraft to the Owner Trustee or its designee pursuant to the terms of the
Lease (other than pursuant to and in accordance with Section 15 thereof, in
which case Lessee's liability under this Section 6(c) shall survive for so
long as Lessor shall be entitled to exercise remedies under such Section
15), (II) the termination of the Term in accordance with Section 9 of the
Lease, (III) the payment by Lessee of all amounts required to be paid under
the Lease following an Event of Loss or (IV) termination of the Lease and
payment by Lessee of all amounts required to be paid by Lessee pursuant to
the terms of the Operative Documents or (12) any amount which any
Indemnitee expressly agrees to pay under any Operative Document or any
amount which is expressly stated to be an Expense that is not reimbursable
by Lessee under the Operative Documents, or (13) any amount that is an
ordinary and usual operating or overhead expense of any Indemnitee (it
being understood out-of-pocket expenses payable to third parties do not
constitute "ordinary and usual operating and overhead expenses"), or (14)
any amounts relating to the deregistration with the FAA of the Aircraft as
a result of the Owner Participant or the Owner Trustee, as the case may be,
not being a Citizen of the United States or any other act or omission of
the Owner Trustee, the Owner Participant or such Indemnitee, or (15) any
amounts attributable to any Lien which such Indemnitee is required to
remove pursuant to the terms of the Operative Documents or the Pass Through
Documents, or (16) any loss of tax benefits or increases in tax liability
whether or not the Lessee is required to indemnify an Indemnitee elsewhere
in the Operative Documents, or (17) principal of, or interest or premium on
the Equipment Notes, or (18) any prohibited transaction, within the meaning
of Section 406 of ERISA or Section 4975(c)(1) of the Code, occurring with
respect to the purchase or holding of any Pass Through Certificate (i) over
which purchase or holding the Owner Participant or any Affiliate thereof
has discretion or control (other than in the capacity of a directed trustee
or custodian), or (ii) by an employee benefit plan, within the meaning of
Section 3(3) of ERISA, or individual retirement account or plan subject to
Section 4975 of the Code with respect to which the Owner Participant (or
any Affiliate thereof) has the power, directly or indirectly, to appoint or
terminate, or to negotiate the terms of the management agreement with, the
person or persons having discretion or control (other than in the capacity
of a directed trustee or custodian), over such purchase or holding, or (19)
without limiting any indemnification otherwise expressly provided under the
Operative Documents, any amount payable under the Pass Through Documents
(other than the Participation Agreement) to the extent not included in the
definition of Supplemental Rent.
Lessee's indemnity obligation to an Indemnitee under this Section
6(c) shall equal the amount which, after taking into account any Tax
imposed upon the receipt or accrual of the amounts payable under this
Section 6(c) and any tax benefits realized by such Indemnitee as a result
of the accrual or payment of such Expense shall equal the amount of the
Expense indemnifiable under this Section 6(c).
If any Indemnitee shall realize a tax savings by reason of any
Tax paid or indemnified by Lessee pursuant to this Section 6(c) (whether
such tax savings shall be by means of a foreign tax credit, depreciation or
cost recovery deduction or otherwise) and such savings is not otherwise
taken into account in computing such payment or indemnity such Indemnitee
shall pay to Lessee an amount equal to the lesser of (i) the amount of such
tax savings, plus any additional tax savings recognized as the result of
any payment made pursuant to this sentence, when, as if, and to the extent,
realized or (ii) the amount of all payments pursuant to this Section 6(c)
by Lessee to such Indemnitee (less any payments previously made by such
Indemnitee to Lessee pursuant to this Section 6(c)) (and the excess, if
any, of the amount described in clause (i) over the amount described in
clause (ii) shall be carried forward and applied to reduce pro tanto any
subsequent obligations of Lessee to make payments to such Indemnitee
pursuant to this Section 6(c)).
Nothing in this Section 6(c) shall be construed as a guaranty by
Lessee of payments due pursuant to the Equipment Notes or of the residual
value of the Aircraft.
If a claim is made against an Indemnitee involving one or more
Expenses and such Indemnitee has notice thereof, such Indemnitee shall
promptly after receiving such notice give notice of such claim to Lessee;
provided that the failure to give such notice shall not affect the
obligations of Lessee hereunder except to the extent Lessee is prejudiced
by such failure or the Lessee's indemnification obligations are increased
as a result of such failure. If no Lease Event of Default shall have
occurred and be continuing, Lessee shall be entitled, at its sole cost and
expense, acting through counsel reasonably acceptable to the respective
Indemnitee, (A) in any judicial or administrative proceeding that involves
solely a claim for one or more Expenses, to assume responsibility for and
control thereof, (B) in any judicial or administrative proceeding involving
a claim for one or more Expenses and other claims related or unrelated to
the transactions contemplated by the Operative Documents, to assume
responsibility for and control of such claim for Expenses to the extent
that the same may be and is severed from such other claims (and such
Indemnitee shall use its best efforts to obtain such severance), and (C) in
any other case, to be consulted by such Indemnitee with respect to judicial
proceedings subject to the control of such Indemnitee and to be allowed, at
Lessee's sole expense, to participate therein. Notwithstanding any of the
foregoing to the contrary, Lessee shall not be entitled to assume
responsibility for and control of any such judicial or administrative
proceedings if such proceedings will involve a material risk of the sale,
forfeiture or loss of, or the creation of any Lien (other than a Permitted
Lien) on, the Aircraft, the Trust Estate, the Trust Indenture Estate or any
part thereof unless in such an event Lessee shall have posted a bond or
other security satisfactory to the relevant Indemnitees in respect to such
risk. The Indemnitee may participate at its own expense and with its own
counsel in any judicial proceeding controlled by Lessee pursuant to the
preceding provisions.
The affected Indemnitee shall supply Lessee with such information
reasonably requested by Lessee as is necessary or advisable for Lessee to
control or participate in any proceeding to the extent permitted by this
Section 6(c). Such Indemnitee shall not enter into a settlement or other
compromise with respect to any Expense without the prior written consent of
Lessee, which consent shall not be unreasonably withheld or delayed, unless
such Indemnitee waives its right to be indemnified with respect to such
Expense under this Section 6(c).
The Lessee shall supply the Indemnitee with such information
reasonably requested by the Indemnitee as is necessary or advisable for the
Indemnitee to control or participate in any proceeding to the extent
permitted by this Section 6(c).
Upon payment of any Expense pursuant to this Section 6(c),
Lessee, without any further action, shall be subrogated to any claims the
Indemnitee may have relating thereto. The Indemnitee agrees to give such
further assurances or agreements and to cooperate with Lessee to permit
Lessee to pursue such claims, if any, to the extent reasonably requested by
Lessee.
If an Indemnitee is reimbursed, in whole or in part, with respect
to any Expense paid by Lessee hereunder, it will promptly pay the amount
refunded, including interest received thereto (but not an amount in excess
of the amount Lessee or any of its insurers has paid in respect of such
Expense pursuant to this Section 6(c)) over to Lessee.
To the extent permitted by applicable law, interest at the Base
Rate plus one percent (1.0%) shall be paid, on demand, on any amount or
indemnity not paid when due pursuant to this Section 6 until the same shall
be paid. Such interest shall be paid in the same manner as the unpaid
amount in respect of which such interest is due.
Any amount which is payable to Lessee by any Person pursuant to
this Section 6 shall not be paid to Lessee if a Lease Event of Default has
occurred and is continuing or if any payment is due and owing by Lessee to
such Person under the Lease or any other Operative Document. Any such
amount shall be held by such Person (the Lessee hereby granting a security
interest in such amount to such Person) and, if a Lease Event of Default
shall have occurred and be continuing, shall be applied against Lessee's
obligations hereunder to such Person as and when due (and, to the extent
that Lessee has no obligations hereunder to such Person, such amount shall
be paid to Lessee). At such time as there shall not be continuing any such
Lease Event of Default or there shall not be due and owing any such
payment, such amount shall be paid to Lessee to the extent not previously
applied in accordance with the immediately preceding sentence.
(d) Special Indemnity. If a Class C Special Indemnity Event
shall be continuing at any time during any Lease Period, then on the last
day of such Lease Period, Lessee shall pay to the Pass Through Trustee on
behalf of the US Airways Pass Through Trust 1999 1C the amount which has
accrued during the period between [Rent Payment Dates] [Lease Period Dates]
in accordance with the following sentence and which remains unpaid on such
Lease Period Date (such amount, the "Class C Special Indemnity Payment").
The Class C Special Indemnity Payment shall accrue during each Lease Period
at a daily rate equal to the Multiplier, in effect from time to time during
the period between [Rent Payment Dates] [Lease Period Dates], multiplied by
the aggregate principal amount of the Series C Equipment Notes outstanding
on such date divided by 360. The Pass Through Trustee agrees that it will
accept and receive the Class C Special Indemnity Payment on behalf of the
US Airways Pass Through Trust 1999-1C and that it will distribute the Class
C Special Indemnity Payment in accordance with the Trust Agreement for the
US Airways Pass Through Trust 1999-1C.
SECTION 7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) Covenants Regarding Citizenship. Each of the Owner
Participant and First Security Bank, National Association, in its
individual capacity, represents and warrants to the other parties to this
Agreement that it is, and on the Delivery Date will be, a Citizen of the
United States without making use of any voting trust, voting powers
agreement or similar arrangement. The Owner Participant agrees, solely for
the benefit of Lessee and the Loan Participants, that if (i) it shall cease
to be, or believes itself likely to cease to be, a Citizen of the United
States and (ii) the Aircraft shall or would therefore become ineligible for
registration in the name of the Owner Trustee under the Transportation Code
and regulations then applicable thereunder, then the Owner Participant
shall (at its own expense and without any reimbursement or indemnification
from Lessee) as soon as practicable, but in any event within 60 days of
obtaining knowledge of such ineligibility or loss of citizenship effect a
voting trust, voting powers agreement or other similar arrangement or take
any other action as may be necessary to prevent any deregistration and to
maintain the United States registration of the Aircraft. It is agreed
that: (A) the Owner Participant shall be liable to pay on request to each
of the other parties hereto and to each holder of a Equipment Note for any
damages suffered by any such other party or holder as the result of the
representation and warranty of the Owner Participant in the first sentence
of this Section 7(a) proving to be untrue as of the Delivery Date; and (B)
the Owner Participant shall be liable to Lessee, any Sublessee and the Loan
Participants for any damages which may be incurred by Lessee, any Sublessee
or the Loan Participants as a result of the Owner Participant's failure to
comply with its obligations pursuant to the second sentence of this Section
7(a). Each party hereto agrees, upon the request and at the sole expense
of the Owner Participant, to cooperate with the Owner Participant in
complying with its obligations under the provisions of the second sentence
of this Section 7(a). First Security Bank, National Association, in its
individual capacity, agrees that if at any time an officer or responsible
employee of the Corporate Trust Department of First Security Bank, National
Association, shall obtain actual knowledge that First Security Bank,
National Association, has ceased to be a Citizen of the United States
without making use of a voting trust, voting powers agreement or similar
arrangement, it will promptly resign as Owner Trustee (if and so long as
such citizenship is necessary under the Transportation Code as in effect at
such time or, if it is not necessary, if and so long as the Owner Trustee's
citizenship would have any material adverse effect on the Loan
Participants, Lessee or the Owner Participant), effective upon the
appointment of a successor Owner Trustee in accordance with Section 9.01 of
the Trust Agreement. If the Owner Participant or First Security Bank,
National Association, in its individual capacity, does not comply with the
requirements of this Section 7(a), the Owner Trustee, the Indenture Trustee
and the Participants hereby agree that a Lease Default or Lease Event of
Default shall not have occurred and be continuing due to non-compliance by
Lessee with the registration requirements in the Lease.
(b) Location of Records. First Security Bank, National
Association, in its individual capacity, agrees that it will not change
the location of its principal place of business or the office where it
maintains its books and records with respect to the Aircraft and the Trust
Estate to a location outside of Salt Lake City, Utah, without prior written
notice to all parties.
(c) Securities Act. Each Loan Participant represents and
warrants that neither it nor anyone acting in its behalf has offered any
Equipment Notes for sale to, or solicited any offer to buy any Equipment
Note from, any person or entity other than in a manner in compliance with,
and which does not require registration under, the Securities Act or the
rules and regulations thereunder.
(d) Reregistration. The Owner Participant, the Indenture
Trustee, the Pass Through Trustee and each Loan Participant agree that, at
any time after the Depreciation Period, so long as no Lease Event of
Default shall have occurred and be continuing, Lessee may elect to effect a
change in registration of the Aircraft, at Lessee's cost and expense, so
long as the country of registry of the Aircraft is a country listed on
Exhibit A. Upon the request of the Lessee, Exhibit A shall be amended from
time to time to include any other country which the Owner Participant and
the Indenture Trustee have determined, acting reasonably, would provide
substantially equivalent protection for the rights of owner participants,
lessors or lenders in similar transactions as provided under the laws of
the United States and the states thereof. In order for Lessee to effect a
change in the country of registry of the Aircraft, Lessee shall deliver to
the Owner Participant, the Owner Trustee (in its individual capacity) and
the Indenture Trustee the following:
(I) an Officer's Certificate certifying that (A) the insurance or
self-insurance required by Section 11 of the Lease shall be in
full force and effect at the time of such change in registration
after giving effect to such change in registration, (B) all
indemnities in favor of the Owner Participant, the Owner Trustee
(in its individual capacity and as trustee under the Trust
Agreement) and the Indenture Trustee under any Operative Document
afford each such party substantially the same protection as
provided prior to such change of registry, (C) the lien of the
Trust Indenture in favor of the Trustee will continue as a first
priority lien following such change of registry, (D) such change
will not result in the imposition of, or increase in the amount
of, any Tax for which Lessee is not required to indemnify, or is
not then willing to enter into a binding agreement to indemnify,
the Owner Participant, the Note Holders, the Indenture Trustee,
the Owner Trustee (in its individual capacity and as trustee
under the Trust Agreement), the Indenture Trustee or the Trust
Estate pursuant to this Agreement or the Tax Indemnity Agreement,
and (E) that the new country of registry imposes aircraft
maintenance standards not materially less stringent from those of
any Permitted Foreign Air Authority; and
(II) a favorable opinion (subject to customary exceptions) of counsel
(opinion and counsel reasonably acceptable to the Owner
Participant) addressed to the Owner Participant and the Indenture
Trustee, from counsel of recognized reputation qualified in the
laws of the relevant jurisdiction to the effect that: (A) the
obligations of Lessee, and the rights and remedies of the Owner
Trustee, under the Lease shall remain valid, binding and (subject
to customary bankruptcy and equitable remedies exceptions and to
other exceptions customary in foreign opinions generally)
enforceable under the laws of such jurisdiction (or the laws of
the jurisdiction to which the laws of such jurisdiction would
refer as the applicable governing law); (B) it is not necessary,
solely as a consequence of such change in registration and
without giving effect to any other activity of the Owner Trustee,
the Owner Participant or the Indenture Trustee (or any Affiliate
thereof), as the case may be, for the Owner Trustee, the Owner
Participant or the Indenture Trustee to register or qualify to do
business in such jurisdiction; (C) there is no tort liability of
the owner of an aircraft not in possession thereof under the laws
of such jurisdiction (it being agreed that, in the event such
latter opinion cannot be given in a form satisfactory to the
Owner Participant, such opinion shall be waived if insurance
reasonably satisfactory to the Owner Participant is provided to
cover such risk); (D) unless Lessee shall have agreed to provide
insurance covering the risk of requisition of use of such
Aircraft by the government of such jurisdiction so long as such
Aircraft is registered under the laws of such jurisdiction, the
laws of such jurisdiction require fair compensation by the
government of such jurisdiction payable in currency freely
convertible into Dollars for the loss of use of such Aircraft in
the event of the requisition by such government of such use; and
(E) after giving effect to such change in registration, the Lien
of the Trust Indenture on the Owner Trustee's right, title and
interest in and to the Aircraft and the Lease shall continue as a
valid and duly perfected first priority security interest and all
filing, recording or other action necessary to protect the same
shall have been accomplished (or, if such opinion cannot be given
at the time of such proposed change in registration because such
change in registration is not yet effective, (1) the opinion
shall detail what filing, recording or other action is necessary,
and (2) the Owner Trustee and the Indenture Trustee shall have
received a certificate from Lessee that all possible preparations
to accomplish such filing, recording and other action shall have
been done, and such filing, recording and other action shall be
accomplished and a supplemental opinion to that effect shall be
delivered to the Owner Trustee and the Indenture Trustee on or
prior to the effective date of such change in registration).
Upon receipt of the foregoing certificate and opinion, the Owner
Participant and the Indenture Trustee will instruct the Owner Trustee to
make such change of registration.
Lessee shall pay all reasonable costs, expenses, fees, recording
and registration taxes, including the reasonable fees and expenses of
counsel to the Owner Trustee, the Owner Participant and the Indenture
Trustee, and other charges in connection with any such change in
registration.
(e) Owner Participant Representations and Warranties. The Owner
Participant represents and warrants to Lessee, the Owner Trustee, the
Indenture Trustee, the Pass Through Trustee, the Subordination Agent, the
Liquidity Provider and the Owner Trustee, in its capacity as such and in
its individual capacity, as follows:
(i) it is duly incorporated, validly existing and in good
standing under the laws of the State of __________ and has the
corporate power and authority to carry on its present business and
operations and to own or lease its properties, and has the corporate
power and authority to enter into and to perform its obligations under
the Owner Participant Documents; this Agreement and the other Owner
Participant Documents have been duly authorized, executed and
delivered by it; and this Agreement and each of the other Owner
Participant Documents constitute the legal, valid and binding
obligations of the Owner Participant enforceable against it in
accordance with its respective terms, except as such enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting the rights of creditors generally and
by general principles of equity, whether considered in a proceeding at
law or in equity; and the Owner Participant is a Qualified Owner
Participant;
(ii) neither (A) the execution and delivery by the Owner
Participant of the Owner Participant Documents nor (B) compliance by
it with all of the provisions thereof, (x) will contravene any law or
order of any court or governmental authority or agency applicable to
or binding on the Owner Participant (it being understood that no
representation or warranty is made with respect to laws, rules or
regulations relating to aviation or to the nature of the equipment
owned by the Owner Trustee other than such laws, rules or regulations
relating to the citizenship requirements of the Owner Participant
under applicable law), or (y) will contravene the provisions of, or
constitutes or has constituted or will constitute a default under, or
result in the creation of any Lien (other than Liens provided for in
the Operative Documents) upon any property of the Owner Participant
under, its certificate of incorporation or by-laws or any indenture,
mortgage, contract or other agreement or instrument to which the Owner
Participant is a party or by which it or any of its property may be
bound or affected;
(iii) no authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory
body (other than as required by the Transportation Code or the
regulations promulgated thereunder) is required for the due execution,
delivery or performance by it of the Owner Participant Documents;
(iv) there are no pending or, to its knowledge, threatened
actions or proceedings before any court or administrative agency or
arbitrator which would materially adversely affect the Owner
Participant's ability to perform its obligations under this Agreement,
the Participation Agreement, the Tax Indemnity Agreement and the Trust
Agreement;
(v) neither the Owner Participant nor anyone authorized by it to
act on its behalf (it being understood that in proposing, facilitating
and otherwise taking any action in connection with the financing
contemplated hereby and agreed to herein by the Owner Participant,
Lessee has not acted as agent of the Owner Participant) has directly
or indirectly offered any Equipment Note or Pass Through Trust
Certificate or any interest in and to the Trust Estate, the Trust
Agreement or any similar interest for sale to, or solicited any offer
to acquire any of the same from, any Person; the Owner Participant's
interest in the Trust Estate and the Trust Agreement is being acquired
for its own account and is being purchased for investment and not with
a view to any resale or distribution thereof;
(vi) on the Delivery Date, the Trust Estate shall be free of
Lessor Liens attributable to the Owner Participant; and
(vii) it is a Citizen of the United States (without making use
of a voting trust agreement, voting powers agreement or similar
arrangement).
(f) Lessor Liens. Each of First Security Bank, National
Association, in its individual capacity, and the Owner Participant
covenants and agrees that it shall not cause or permit to exist a Lessor
Lien attributable to it with respect to the Aircraft or any other portion
of the Trust Estate. Each of First Security Bank, National Association, in
its individual capacity, and the Owner Participant agrees that it will
promptly, at its own expense, take such action as may be necessary duly to
discharge such Lessor Lien attributable to it. Each of First Security
Bank, National Association, in its individual capacity, and the Owner
Participant agrees to make restitution to the Trust Estate for any actual
diminution of the assets of the Trust Estate resulting from Lessor Liens
attributable to it. The Owner Participant agrees to make restitution to
the Trust Estate for any actual diminution of the assets of the Trust
Estate resulting from any Taxes or Expenses imposed on the Trust Estate
against which Lessee is not required to indemnify the Trust Estate
pursuant to Section 6.
(g) Quiet Enjoyment. Each Loan Participant and each of the
Indenture Trustee, the Subordination Agent, the Owner Trustee, the Pass
Through Trustee and the Owner Participant covenants and agrees that, so
long as no Lease Event of Default shall have occurred and be continuing
and the Lessee has not been duly declared in default and, notwithstanding
default by any Loan Participant, the Indenture Trustee, the Owner Trustee,
the Pass Through Trustee or the Owner Participant, that such Person shall
not (and shall not permit any Affiliate or other Person claiming by,
through or under it to) interfere with Lessee's (or any Sublessee's)
continued possession, use and operation of, and quiet enjoyment of, the
Aircraft or Lessee's rights, benefits and obligations pursuant to the
Transactions during the Term of the Lease, and the Lease shall not be
terminated except as expressly provided therein.
(h) Equipment Notes Acquired for Investment. Each Loan
Participant represents and warrants that the Equipment Note to be issued to
it pursuant to the Trust Indenture is being acquired by it for investment
and not with a view to resale or distribution (it being understood that
such Loan Participant may pledge or assign as security its interest in each
Equipment Note issued to it), except that the Loan Participants may sell,
transfer or otherwise dispose of any Equipment Note or any portion thereof,
or grant participations therein, in a manner which in itself does not
require registration under the Securities Act.
(i) [Reserved.]
(j) Representations, Warranties and Covenants of Indenture
Trustee. State Street Bank and Trust Company of Connecticut, National
Association represents, warrants (as of the Delivery Date) and covenants,
in its individual capacity, to Lessee, the Owner Trustee, the Pass Through
Trustee, the Subordination Agent, the Liquidity Provider and the Owner
Participant as follows:
(i) the Indenture Trustee is a national banking association duly
incorporated, validly existing and in good standing under the laws of
the United States, is a Citizen of the United States (without making
use of any voting trust, voting powers agreement or similar
arrangement), will notify promptly all parties to this Agreement if in
its reasonable opinion its status as a Citizen of the United States
(without making use of any voting trust, voting powers agreement or
similar arrangement) is likely to change and will resign as Indenture
Trustee as provided in Section 8.02 of the Trust Indenture promptly
after it obtains actual knowledge that it has ceased to be such a
Citizen of the United States (without making use of a voting trust,
voting powers agreement or similar arrangement), and has the full
corporate power, authority and legal right under the laws of the State
of Connecticut and the United States pertaining to its banking, trust
and fiduciary powers to execute and deliver each of this Agreement,
the Trust Indenture and each other Operative Document to which it is a
party and to carry out its obligations under this Agreement, the Trust
Indenture, each other Operative Document to which it is a party and to
authenticate the Equipment Notes;
(ii) the execution and delivery by the Indenture Trustee of the
Indenture Trustee Documents and the authentication of the Equipment
Notes and the performance by the Indenture Trustee of its obligations
under the Indenture Trustee Documents have been duly authorized by the
Indenture Trustee and will not violate its articles of association or
by-laws or the provisions of any indenture, mortgage, contract or
other agreement to which it is a party or by which it is bound;
(iii) this Agreement and each of the other Indenture Trustee
Documents constitute the legal, valid and binding obligations of the
Indenture Trustee enforceable against it in accordance with their
respective terms, except as the same may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and by general principles
of equity, whether considered in a proceeding at law or in equity;
(iv) there are no pending or, to its knowledge, threatened
actions or proceedings against the Indenture Trustee, either in its
individual capacity or as Indenture Trustee, before any court or
administrative agency which, if determined adversely to it, would
materially adversely affect the ability of the Indenture Trustee, in
its individual capacity or as Indenture Trustee as the case may be, to
perform its obligations under the Operative Documents to which it is a
party; and
(v) there are no Indenture Trustee Liens on the Aircraft or any
portion of the Trust Estate.
(k) Owner Participant Transfers. So long as the Aircraft shall
be leased to the Lessee under the Lease, the Owner Participant will not,
directly or indirectly, sell, assign, convey or otherwise transfer any of
its right, title or interest in and to this Agreement, the Trust Estate or
the Trust Agreement or any proceeds therefrom to any person or entity,
unless (i) the proposed transferee is a "Transferee" (as defined below),
(ii) Lessee shall have (1) received an opinion (in form and substance
reasonably satisfactory to Lessee) of counsel to the Owner Participant (who
shall be reasonably satisfactory to Lessee) to the effect that such
transfer will not result in any risk of loss of tax benefits to, or any
increase in the tax liability of, Lessee and (2) received from the Owner
Participant so seeking to transfer such right, title or interest reasonably
satisfactory indemnification for any loss of tax benefits to, and increase
in the tax liability of, Lessee, and (iii) the Owner Participant sells,
assigns, conveys or otherwise transfers all of its right, title and
interest in and to this Agreement, the Trust Estate, the Trust Agreement
and the proceeds therefrom to a single entity. A "Transferee" shall mean
either (A) a bank or other financial institution with a combined capital,
surplus and undivided profits of at least [$50,000,000] or a corporation
whose tangible net worth is at least [$50,000,000], exclusive of goodwill,
in either case as of the proposed date of such transfer, as determined in
accordance with generally accepted accounting principles, or (B) any
subsidiary of such a bank, financial institution or corporation, provided
that such bank, financial institution or corporation furnishes to the Owner
Trustee, the Indenture Trustee and Lessee a guaranty with respect to the
Owner Participant's obligations under the Operative Documents to which the
Owner Participant is a party in form and substance reasonably satisfactory
to Lessee, the Owner Trustee, and the Indenture Trustee, or (C) is an
affiliate of the Owner Participant and the Owner Participant agrees to
remain liable for all obligations of the Owner Participant under the
Operative Documents; provided, further, that any Transferee shall not be an
airline, a commercial aircraft operator, an air freight forwarder, an
entity engaged in the business of parcel transport by air or other similar
Person or an Affiliate thereof. Each such transfer to a Transferee shall
be subject to the conditions that (S) upon giving effect to such transfer,
the Transferee is a Citizen of the United States (without making use of a
voting trust agreement, voting powers agreement or other similar
arrangement unless approved by Lessee), and has full power and authority to
enter into the transactions contemplated hereby, (T) the Transferee has the
requisite power and authority to enter into and carry out the transactions
contemplated hereby and such Transferee shall have delivered to Lessee, the
Owner Trustee and the Indenture Trustee an opinion of counsel in form and
substance reasonably satisfactory to Lessee and the Owner Trustee as to the
due authorization, delivery, legal, valid and binding effect and
enforceability of the agreement or agreements referred to in the next
clause with respect to the Transferee and any guaranty provided pursuant to
the provisions of this Section 7(k) as to the guarantor, (U) the Transferee
enters into an agreement or agreements, in form and substance reasonably
satisfactory to the Owner Trustee and Lessee, whereby the Transferee
confirms that it shall be deemed a party to this Agreement and a party to
the Trust Agreement and agrees to be bound by all the terms of, and to
undertake all of the obligations of the transferor Owner Participant
contained in, the Owner Participant Documents (to the extent of the
participation so transferred to it) and makes the representations and
warranties made by the Owner Participant thereunder, (V) such transfer does
not affect registration of the Aircraft under the Transportation Code, or
any rules or regulations promulgated thereunder or create a relationship
which would be in violation thereof or violate any provision of the
Securities Act or any other applicable Federal or state law and the Lessee
shall be entitled to require an opinion of counsel to such effect, (W) the
transferor Owner Participant assumes the risk of any adverse tax
consequences with respect to the true lease nature of the transaction
(including, without limitation, loss of depreciation and amortization
deductions and interest deductions resulting from such transfer, (X) the
transferor Owner Participant pays all of the reasonable costs and expenses
(including, without limitation, the reasonable fees and expenses of
counsel) incurred in connection with such transfer, including the
reasonable costs and expenses of the Owner Trustee, the Indenture Trustee,
Lessee and the Loan Participants in connection therewith without the right
of indemnification or reimbursement by Lessee, (Y) the terms of the
Operative Documents and the Transactions shall not be altered and (Z) such
transfer will not give rise to a Default under the Trust Indenture or an
Indenture Event of Default. Upon any such transfer by the Owner
Participant as above provided, the Transferee shall be deemed the Owner
Participant for all purposes hereof and of the other Operative Documents
and each reference herein to the transferor Owner Participant shall
thereafter be deemed for all purposes to be to the Transferee and the
transferor Owner Participant shall be relieved of all obligations of the
transferor Owner Participant under the Owner Participant Documents arising
after the date of such transfer except to the extent fully attributable to
or arising out of acts or events occurring prior thereto and not assumed by
the Transferee. If the Owner Participant intends to transfer any of its
interests hereunder, it shall give thirty (30) days prior written notice
thereof to the Indenture Trustee, the Owner Trustee and Lessee, specifying
the name and address of the proposed Transferee and providing the financial
statements of such proposed Transferee.
(l) Reserved.
(m) Compliance with Trust Indenture. First Security Bank,
National Association, and State Street Bank and Trust Company of
Connecticut, National Association, each in its individual capacity, agrees
for the benefit of Lessee to comply with the terms of the Trust Indenture
which it is required to comply with in its individual capacity.
(n) ERISA Matters. The Owner Participant represents and
warrants as of the Delivery Date that either (i) no part of the source of
funds used to acquire and hold its interest in the Trust Estate constitutes
the assets of any "employee benefit plan" as defined in Section 3(3) of
ERISA or of any "plan" within the meaning of Section 4975(e)(1) of the
Code, including, without limitation, as applicable, an insurance company
general account ("Plan Assets") or (ii) the source of funds used to acquire
and hold its interest in the Trust Estate is an insurance company general
account (within the meaning of United States Department of Labor Prohibited
Transaction Class Exemption ("PTCE") 95-60 (issued July 12, 1995)), and as
of the date hereof and at all times while it holds such interest (x) less
than 25% of the assets of such general account do and will constitute Plan
Assets and (y) the amount of reserves and liabilities (as defined in the
annual statement for life insurance companies approved by the National
Association of Insurance Commissioners ("NAIC Annual Statement") (the
"Reserves and Liabilities")) for the general account contract(s) held by or
on behalf of any employee benefit plan subject to Title I of ERISA or any
plan subject to Section 4975 of the Code (an "ERISA Plan"), together with
the amount of the Reserves and Liabilities for the general account
contract(s) held by or on behalf of any other ERISA Plans maintained by the
same employer (or any "affiliate" thereof within the meaning of Section
V(a)(1) of PTCE 95-60) or by the same employee organization, do not and
will not exceed 10% of the total Reserves and Liabilities of such general
account (exclusive of separate account liabilities) plus surplus, as set
forth in the NAIC Annual Statement filed with the state of domicile of the
insurance company maintaining such general account (the conditions of this
clause (y) shall be referred to as the "Reserves and Liabilities
Conditions"). Each Loan Participant agrees that it will not transfer any
Equipment Note (or any part thereof) to any entity (except pursuant to
Section 2.14 of the Trust Indenture) unless such entity either (i) makes a
representation and warranty as of the date of transfer that no part of the
funds to be used by it for the purchase and holding of such Equipment Note
(or any part thereof) constitutes Plan Assets or that such purchase and
holding will not constitute or result in a non-exempt prohibited
transaction (as defined in Section 4975 of the Code and ERISA), provided,
that Equipment Notes may be transferred to a Pass Through Trustee in
connection with an offering of Certificates by the related Pass Through
Trust if, as a condition of such offering, each person or entity acquiring
such Certificates makes (or is deemed to make) the foregoing representation
and warranty with respect to its purchase and holding of such Certificates.
The Owner Participant agrees that it will not transfer any of its right,
title or interest in and to this Agreement, the Trust Estate or the Trust
Agreement or any proceeds therefrom to any entity unless such entity makes
(or is deemed to have made) a representation and warranty as of the date of
transfer that either no part of the funds to be used by it for the purchase
and holding of such right, title, interest and proceeds (or any part
thereof) constitutes Plan Assets or (ii) is an insurance company general
account that represents, warrants and covenants both as of the date it
acquires such right, title, interest and proceeds and at all times while it
holds such right, title, interest and proceeds that (x) less than 25% of
the assets of such general account will constitute Plan Assets and (y) the
Reserves and Liabilities Conditions will be satisfied, such that such
transfer will not constitute or result in a non-exempt prohibited
transaction (as defined in Section 4975 of the Code and ERISA). The Pass
Through Trustee agrees that it will not agree to any amendment,
modification or waiver of Section 1.01(e)(1) of the initial supplement to
each Pass Through Trust Agreement without the prior written consent of the
Owner Participant.
(o) Confidentiality of Purchase Agreement. Each Participant,
the Owner Trustee and the Indenture Trustee agrees for the benefit of the
Manufacturer and Lessee that it will not disclose or suffer to be disclosed
the terms of the Purchase Agreement to any third party except (A) as may be
required by any applicable statute, court or administrative order or decree
or governmental ruling or regulation or to any regulatory authorities
having official jurisdiction over them, (B) in connection with the
financing of the Aircraft and the other transactions contemplated by the
Operative Documents (including any transfer of Equipment Notes (including
by way of participation or assignment of an interest, provided such
participant or assignee agrees to hold such terms confidential to the same
extent as herein provided) or the Owner Participant's beneficial interest
in the Trust Estate and any exercise of remedies under the Lease and the
Trust Indenture), (C) with the prior written consent of the Manufacturer
and Lessee, (D) to the Owner Trustee's, the Indenture Trustee's and each
Participant's counsel or special counsel, independent insurance brokers or
other agents who agree to hold such information confidential, or (E) in the
case of the Owner Participant and/or the Owner Trustee, it may disclose so
much of the Purchase Agreement as has been assigned to the Owner Trustee
under the Purchase Agreement Assignment to bona fide potential purchasers
of the Aircraft.
(p) Margin Regulations. The Owner Trustee and the Owner
Participant severally, not jointly, represent and warrant, as of the
Delivery Date that none of the funds made available by the Pass Through
Trustee pursuant to Section 1 hereof will be used for the purpose of
purchasing or carrying any "margin security" as defined in Regulation U of
the Board of Governors of the Federal Reserve System or for the purpose of
reducing or retiring any indebtedness which was originally incurred to
purchase or carry such margin security or for any other purpose which might
cause the transaction contemplated by this Agreement to constitute a
"purpose credit" within the meaning of Regulation X of the Board of
Governors of the Federal Reserve System, assuming that the proceeds were
and are applied as contemplated by the provisions of this Agreement.
(q) Loan Participant Liens. Each Loan Participant covenants and
agrees that it shall not cause or permit to exist a Loan Participant Lien
attributable to it with respect to the Aircraft or any other portion of the
Trust Estate. Each Loan Participant agrees that it will promptly, at its
own expense, take such other action as may be necessary duly to discharge
such Loan Participant Lien attributable to it. Each Loan Participant agrees
to make restitution to the Trust Estate for any actual diminution of the
assets of the Trust Estate resulting from such Loan Participant Lien
attributable to it.
(r) Indenture Trustee Liens. State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity,
covenants and agrees that it shall not cause or permit to exist any
Indenture Trustee's Liens with respect to the Trust Indenture Estate or the
Trust Estate. State Street Bank and Trust Company of Connecticut, National
Association, in its individual capacity, agrees that it will promptly, at
its own expense, take such action as may be necessary duly to discharge
such Indenture Trustee's Liens. State Street Bank and Trust Company of
Connecticut, National Association, in its individual capacity, agrees to
make restitution to the Trust Estate for any actual diminution of the
assets of the Trust Indenture Estate or the Trust Estate resulting from
such Indenture Trustee's Liens.
(s) Representations and Warranties of Owner Trustee. The Owner
Trustee, in its individual capacity (except as provided in clauses (iii)
and (vii) below) and (but only as provided in clauses (iii) and (vii) and,
to the extent that it relates to the Owner Trustee, clauses (ii), (ix) and
(xi) below) as Owner Trustee, represents and warrants to Lessee, the Pass
Through Trustee, the Subordination Agent, the Liquidity Provider and the
Owner Participant as follows:
(i) the Owner Trustee, in its individual capacity, is a national
banking association duly organized and validly existing in good
standing under the laws of the United States, has full corporate power
and authority to carry on its business as now conducted, has the
corporate power and authority to execute and deliver the Trust
Agreement, has the corporate power and authority to carry out the
terms of the Trust Agreement, and has (assuming the authorization,
execution and delivery of the Trust Agreement by the Owner
Participant), as Owner Trustee, and to the extent expressly provided
herein or therein, in its individual capacity, the corporate power and
authority to execute and deliver and to carry out the terms of this
Agreement, the Trust Indenture, the Equipment Notes, the Lease and
each other Operative Document (other than the Trust Agreement) to
which it is a party;
(ii) the Owner Trustee in its trust capacity and, to the extent
expressly provided herein, in its individual capacity, has duly
authorized, executed and delivered this Agreement, in its individual
capacity, has duly authorized, executed and delivered the Trust
Agreement and in its trust capacity, except as expressly provided
therein, has duly authorized, executed and delivered (or, in the case
of Owner Trustee Documents to be executed on the Delivery Date, will
on the Delivery Date, execute and deliver) the other Owner Trustee
Documents and (assuming the due authorization, execution and delivery
of the Trust Agreement by the Owner Participant) this Agreement and
each of the other Owner Trustee Documents constitutes (or, in the case
of documents to be executed and delivered on the Delivery Date, upon
execution and delivery will constitute) the legal, valid and binding
obligations of the Owner Trustee, in its individual capacity or as
Owner Trustee, as the case may be, enforceable against it in its
individual capacity or as Owner Trustee, as the case may be, in
accordance with its terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and by
general principles of equity, whether considered in a proceeding at
law or in equity;
(iii) assuming the due authorization, execution and delivery of
the Trust Agreement by the Owner Participant, the Owner Trustee has
duly authorized, and on the Closing Date shall have duly issued,
executed and delivered to the Indenture Trustee for authentication,
the Equipment Notes pursuant to the terms and provisions hereof and
of the Trust Indenture, and each Equipment Note on the Closing Date
will constitute the valid and binding obligation of the Owner Trustee
and will be entitled to the benefits and security afforded by the
Trust Indenture in accordance with the terms of such Equipment Note
and the Trust Indenture;
(iv) neither the execution and delivery by the Owner Trustee, in
its individual capacity or as Owner Trustee, as the case may be, of
any Owner Trustee Document, nor the consummation by the Owner Trustee,
in its individual capacity or as Owner Trustee, as the case may be, of
any of the transactions contemplated thereby, nor the compliance by
the Owner Trustee, in its individual capacity or as Owner Trustee, as
the case may be, with any of the terms and provisions thereof, (A)
requires or will require any approval of its stockholders, or approval
or consent of any trustees or holders of any indebtedness or
obligations of it, or (B) violates or will violate its articles of
association or by-laws, or contravenes or will contravene any
provision of, or constitutes or will constitute a default under, or
results or will result in any breach of, or results or will result in
the creation of any Lien (other than as permitted under the Operative
Documents) upon its property under, any indenture, mortgage, chattel
mortgage, deed of trust, conditional sale contract, bank loan or
credit agreement, license or other agreement or instrument to which it
is a party or by which it is bound, or contravenes or will contravene
any law, governmental rule or regulation of the United States of
America or the State of Utah governing the trust powers of the Owner
Trustee, or any judgment or order applicable to or binding on it;
(v) no consent, approval, order or authorization of, giving of
notice to, or registration with, or taking of any other action in
respect of, any Utah state or local governmental authority or agency
or any United States Federal governmental authority or agency
regulating the trust powers of the Owner Trustee in its individual
capacity is required for the execution and delivery of, or the
carrying out by, the Owner Trustee, in its individual capacity or as
Owner Trustee, as the case may be, of any of the transactions
contemplated hereby or by the Trust Agreement, the Participation
Agreement, the Trust Indenture, the Lease or the Equipment Notes, or
any other Operative Document to which it is or will be a party or by
which it is or will be bound, other than any such consent, approval,
order, authorization, registration, notice or action as has been duly
obtained, given or taken or which is described in Section 7(a)(iv);
(vi) there exists no Lessor Lien attributable to the Owner
Trustee, in its individual capacity;
(vii) there exists no Lessor Lien attributable to the Owner
Trustee, as lessor under the Lease;
(viii) there are no Taxes payable by the Owner Trustee, either
in its individual capacity or as Owner Trustee, imposed by the State
of Utah or any political subdivision thereof in connection with the
issuance of the Equipment Notes, or the execution and delivery in its
individual capacity or as Owner Trustee, as the case may be, of any
of the instruments referred to in clauses (i), (ii), (iii) and (iv)
above, that, in each case, would not have been imposed if the Trust
Estate were not located in the State of Utah and First Security Bank,
National Association had not (a) had its principal place of business
in, (b) performed (in its individual capacity or as Owner Trustee)
any or all of its duties under the Operative Documents in, and (c)
engaged in any activities unrelated to the transactions contemplated
by the Operative Documents in, the State of Utah;
(ix) there are no pending or, to its knowledge, threatened
actions or proceedings against the Owner Trustee, either in its
individual capacity or as Owner Trustee, before any court or
administrative agency which, if determined adversely to it, would
materially adversely affect the ability of the Owner Trustee, in its
individual capacity or as Owner Trustee, as the case may be, to
perform its obligations under any of the instruments referred to in
clauses (i), (ii), (iii) and (iv) above;
(x) both its chief executive office, and the place where its
records concerning the Aircraft and all its interests in, to and
under all documents relating to the Trust Estate, are located in Salt
Lake City, Utah;
(xi) the Owner Trustee has not, in its individual capacity or as
Owner Trustee, directly or indirectly offered any Equipment Note or
Pass Through Certificate or any interest in or to the Trust Estate,
the Trust Agreement or any similar interest for sale to, or solicited
any offer to acquire any of the same from, anyone other than the Pass
Through Trustee and the Owner Participant; and the Owner Trustee has
not authorized anyone to act on its behalf (it being understood that
in arranging and proposing the refinancing contemplated hereby and
agreed to herein by the Owner Trustee, the Lessee has not acted as
agent of the Owner Trustee) to offer directly or indirectly any
Equipment Note, any Certificate or any interest in and to the Trust
Estate, the Trust Agreement or any similar interest for sale to, or to
solicit any offer to acquire any of the same from, any person;
(xii) it is a Citizen of the United States (without making use
of a voting trust agreement, voting powers agreement or similar
arrangements);
(xiii) there has not occurred any event which constitutes (or,
to the best of its knowledge would, with the passing of time or the
giving of notice or both, constitute) an Indenture Event of Default
which has been caused by or relates to the Owner Trustee, in its
individual capacity, and which is presently continuing; and
(xiv) on the Delivery Date the Owner Trustee shall have received
whatever title to the Aircraft as was conveyed to it by Lessee.
(t) Owner Participant Obligations on Lease Termination. The
Owner Participant covenants and agrees that if (i) Lessee has elected
pursuant to Section 9(a)(1) of the Lease to terminate the Lease by causing
the Aircraft to be sold pursuant to Section 9(b) of the Lease and (ii) the
Owner Trustee has, pursuant to Section 9(b) of the Lease, given to Lessee
written notice of Lessor's election to retain title to the Aircraft and
(iii) the Owner Trustee has failed to make, on or before the Termination
Date, any payment required to be made by the Owner Trustee pursuant to
Section 9(b) of the Lease in connection with its retention of title to the
Aircraft, the Owner Participant will indemnify Lessee for any losses,
damages, costs or expenses of any kind (including any additional rents paid
by Lessee and any fees and expenses of lawyers, appraisers, brokers or
accountants) incurred as a consequence of such failure by the Owner
Trustee.
(u) Transfer of Title; Assumption of Equipment Notes. Each of
the Owner Participant, the Owner Trustee, the Indenture Trustee and Lessee
covenants and agrees that if Lessee elects (A) to purchase the Aircraft
pursuant to Section 19(b) or Section 20 of the Lease or (B) to terminate
the Lease and purchase the Aircraft pursuant to Section 19(c) of the Lease,
then each of the parties will execute and deliver appropriate documentation
transferring all right, title and interest in the Aircraft to Lessee
(including, without limitation, such bills of sale and other instruments
and documents as Lessee shall reasonably request to evidence (on the public
record or otherwise) such transfer and the vesting of all right, title and
interest in and to the Aircraft in Lessee), and if Lessee, in connection
with such purchase, elects to assume the obligations of the Owner Trustee
pursuant to the Trust Indenture and the Equipment Notes each of the parties
will execute and deliver appropriate documentation permitting Lessee to
assume such obligations on the basis of full recourse to Lessee,
maintaining the security interest in the Aircraft created by the Trust
Indenture, releasing the Owner Participant and the Owner Trustee from all
future obligations in respect of the Equipment Notes, the Trust Indenture
and all other Operative Documents and all such other actions as are
reasonably necessary to permit such assumption by Lessee. Notwithstanding
the provisions of this Section 7(u), unless waived by the Loan
Participants, Lessee shall not be entitled to assume the Equipment Notes on
the date for purchase of the Aircraft pursuant to Section 19(c) or 20 of
the Lease if on such date a Specified Default or Lease Event of Default
shall have occurred and be continuing.
Notwithstanding the foregoing, Lessee shall not be entitled to
assume the obligations of the Owner Trustee in respect of the Equipment
Notes unless Lessee causes to be delivered to the Indenture Trustee an
opinion of counsel to the effect that (i) the Lien of the Trust Indenture
continues to be a valid and duly perfected first priority security interest
in and to the Aircraft, (ii) the Indenture Trustee will be entitled to the
benefits of 11 U.S.C. Section 1110; provided that the opinion required by
subclause (ii) need only be given if immediately prior to such assumption
the Owner Trustee would have been entitled to the benefits of 11 U.S.C.
Section 1110 and (iii) the Pass Through Trusts will not be subject to
Federal income taxation and the Note Holders will not recognize income,
gain or loss for Federal income tax purposes as a result of such assumption
and will be subject to taxation in the same amounts, in the same manner,
and at the same times as would have been the case if such assumption had
not occurred.
(v) Lessee Merger Covenant. Lessee will not consolidate with
or merge into any other corporation or convey, transfer or lease
substantially all of its assets as an entirety to any Person unless:
(i) the corporation formed by such consolidation or into which
Lessee is merged or the Person which acquires by conveyance, transfer
or lease substantially all of the assets of Lessee as an entirety
shall be (i) organized and validly existing under the laws of the
United States of America or any state thereof or the District of
Columbia, (ii) a "citizen of the United States" as defined in 49
U.S.C. Section 40102(a)(15), as amended, and (iii) a Certificated Air
Carrier, if and so long as such status is a condition of entitlement
to the benefits of Section 1110 of the Bankruptcy Code with respect to
the Lease or the Aircraft;
(ii) the corporation formed by such consolidation or into which
Lessee is merged or the Person which acquires by conveyance, transfer
or lease substantially all of the assets of Lessee as an entirety
shall execute and deliver to the Owner Trustee, the Indenture Trustee
and the Owner Participant an agreement in form and substance
reasonably satisfactory to the Owner Participant a duly authorized,
valid, binding and enforceable agreement containing an assumption by
such successor corporation or Person of the due and punctual
performance and observance of each covenant and condition of the
Operative Documents to which Lessee is a party to be performed or
observed by Lessee;
(iii) immediately after giving effect to such transaction, no
Lease Event of Default shall have occurred and be continuing; and
(iv) Lessee shall have delivered to the Owner Trustee, the
Indenture Trustee and the Owner Participant a certificate signed by
the President, any Executive Vice President, any Senior Vice President
or any Vice President and by the Secretary or an Assistant Secretary
of Lessee, and an opinion of counsel (which may be Lessee's General
Counsel, Deputy General Counsel, Assistant General Counsel or
Associate General Counsel) reasonably satisfactory to the Owner
Participant, each to the effect that such consolidation, merger,
conveyance, transfer or lease and the assumption agreement mentioned
in clause (ii) above comply with this Section 7(v) and that all
conditions precedent herein provided for relating to such transaction
have been complied with.
Upon any such consolidation or merger or any such conveyance,
transfer or lease of substantially all of the assets of Lessee as an
entirety in accordance with this Section 7(v), the successor corporation or
Person formed by such consolidation or into which Lessee is merged or to
which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, Lessee under
this Agreement with the same effect as if such successor corporation or
Person had been named as Lessee herein. No such conveyance, transfer or
lease of substantially all of the assets of Lessee as an entirety shall
have the effect of releasing Lessee or any successor corporation or Person
which shall theretofore have become such in the manner prescribed in this
Section 7(v) from its liability in respect of any Operative Document to
which it is a party.
(w) Further Assurances. Lessee, at its expense, will take, or
cause to be taken, such action with respect to the recording, filing, re-
recording and refiling of the Lease, the Lease Supplement, the Trust
Agreement, the Trust Indenture, the Trust Supplement and any financing
statements or other instruments as are necessary to maintain, so long as
the Trust Indenture or the Lease is in effect, the perfection of the
security interests created by the Trust Indenture and any security interest
that may be claimed to have been created by the Lease and the ownership
interest of the Owner Trustee in the Aircraft or will furnish to the Owner
Trustee, the Owner Participant and the Indenture Trustee timely notice of
the necessity of such action, together with such instruments, in execution
form, and such other information as may be required to enable them to take
such action. Lessee will notify the Owner Trustee, the Owner Participant
and the Indenture Trustee of any change in the location of its chief
executive office (as such term is used in Article 9 of the Uniform
Commercial Code) promptly after making such change or in any event within
the period of time necessary under applicable law to prevent the lapse of
perfection (absent refiling) of financing statements filed under the
Operative Documents.
(x) Rent Adjustments. Section 3 of the Lease contemplates that,
under certain circumstances, the Owner Participant will make certain
recalculations of Basic Rent, EBO Amount and Termination Value, and the
Owner Participant hereby agrees to make such recalculations as and when
contemplated by the Lease and subject to all the terms and conditions of
the Lease and promptly to take such further actions as may be necessary or
desirable to give effect to and to cause the Owner Trustee to give effect
to the provisions of Section 3 of the Lease.
(y) Owner Participant Costs on Return. The Owner Participant
hereby agrees with Lessee that it will pay, or cause to be paid, all costs
and expenses that are for the account of the Owner Trustee pursuant to
Section 5 of the Lease without the right of reimbursement or
indemnification from Lessee.
(z) Transfer of Equipment Notes. Each Loan Participant hereby
represents, warrants and agrees that it shall not transfer any interest in
any Equipment Note unless and until the transferee agrees in writing
(copies of which shall be provided by the Indenture Trustee to Lessee, the
Owner Trustee and the Owner Participant) to make the representations
contemplated to be made by a Loan Participant in this Agreement and to be
bound by the terms of this Agreement and the Trust Indenture (including,
without limitation, the representations and covenants set forth in Sections
7(c), 7(h), 7(n), and 7(q) hereof and this Section 7(z) and Sections 2.03,
2.14 and 4.03 of the Trust Indenture).
(aa) Representations and Warranties of Pass Through Trustee.
The Pass Through Trustee represents and warrants to Lessee, the Indenture
Trustee, the Subordination Agent, the Liquidity Provider, the Owner
Participant and the Owner Trustee, in its capacity as such and in its
individual capacity, as follows:
(i) the Pass Through Trustee is a national banking association
duly organized, validly existing and in good standing under the laws
of the United States and has the full corporate power, authority and
legal right under the laws of the State of Connecticut and the United
States pertaining to its banking, trust and fiduciary powers to
execute and deliver each of the Pass Through Trust Agreements, the
Intercreditor Agreement and this Agreement and to perform its
obligations under the Pass Through Trust Agreements, the Intercreditor
Agreement and this Agreement;
(ii) this Agreement, each of the Pass Through Trust Agreements
and the Intercreditor Agreement have been duly authorized, executed
and delivered by the Pass Through Trustee; this Agreement, each of the
Pass Through Trust Agreements and the Intercreditor Agreement
constitute the legal, valid and binding obligations of the Pass
Through Trustee enforceable against it in accordance with their
respective terms, except as the same may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and by general principles
of equity, whether considered in a proceeding at law or in equity;
(iii) none of the execution, delivery and performance by the
Pass Through Trustee of any of the Pass Through Trust Agreements, the
Intercreditor Agreement or this Agreement, the purchase by the Pass
Through Trustee of the Equipment Notes pursuant to this Agreement, or
the issuance of the Certificates pursuant to the Pass Through Trust
Agreements, contravenes any law, rule or regulation of the State of
Connecticut or any United States governmental authority or agency
regulating the Pass Through Trustee's banking, trust or fiduciary
powers or any judgment or order applicable to or binding on the Pass
Through Trustee and does not contravene or result in any breach of,
or constitute a default under, the Pass Through Trustee's articles of
association or by-laws or any agreement or instrument to which the
Pass Through Trustee is a party or by which it or any of its
properties may be bound;
(iv) neither the execution and delivery by the Pass Through
Trustee of any of the Pass Through Trust Agreements, the Intercreditor
Agreement or this Agreement, nor the consummation by the Pass Through
Trustee of any of the transactions contemplated hereby or thereby,
requires the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action with respect to,
any Connecticut governmental authority or agency or any Federal
governmental authority or agency regulating the Pass Through Trustee's
banking, trust or fiduciary powers;
(v) there are no Taxes payable by the Pass Through Trustee
imposed by the State of Connecticut or any political subdivision or
taxing authority thereof in connection with the execution, delivery
and performance by the Pass Through Trustee of this Agreement, any of
the Pass Through Trust Agreements or the Intercreditor Agreement
(other than franchise or other taxes based on or measured by any fees
or compensation received by the Pass Through Trustee for services
rendered in connection with the transactions contemplated by any of
the Pass Through Trust Agreements), and there are no Taxes payable by
the Pass Through Trustee imposed by the State of Connecticut or any
political subdivision thereof in connection with the acquisition,
possession or ownership by the Pass Through Trustee of any of the
Equipment Notes (other than franchise or other taxes based on or
measured by any fees or compensation received by the Pass Through
Trustee for services rendered in connection with the transactions
contemplated by any of the Pass Through Trust Agreements), and,
assuming that the trusts created by the Pass Through Trust Agreements
will not be taxable as corporations, but rather, each will be
characterized either as a grantor trust under subpart E, Part I, of
Subchapter J of the Code or as a partnership, such trusts will not be
subject to any Taxes imposed by the State of Connecticut or any
political subdivision thereof;
(vi) there are no pending or threatened actions or proceedings
against the Pass Through Trustee before any court or administrative
agency which individually or in the aggregate, if determined adversely
to it, would materially adversely affect the ability of the Pass
Through Trustee to perform its obligations under this Agreement, the
Intercreditor Agreement or any Pass Through Trust Agreement;
(vii) except for the issue and sale of the Pass Through Trust
Certificates contemplated hereby, the Pass Through Trustee has not
directly or indirectly offered any Equipment Note for sale to any
Person or solicited any offer to acquire any Equipment Notes from any
Person, nor has the Pass Through Trustee authorized anyone to act on
its behalf to offer directly or indirectly any Equipment Note for
sale to any Person, or to solicit any offer to acquire any Equipment
Note from any Person; and the Pass Through Trustee is not in default
under any Pass Through Trust Agreement; and
(viii) the Pass Through Trustee is not directly or indirectly
controlling, controlled by or under common control with the Owner
Participant, the Owner Trustee or Lessee.
(bb) Representations and Warranties of Subordination Agent. The
Subordination Agent represents and warrants to Lessee, the Indenture
Trustee, the Pass Through Trustee, the Liquidity Provider, the Owner
Participant and the Owner Trustee, in its capacity as such and in its
individual capacity, as follows:
(i) the Subordination Agent is a national banking association
duly organized, validly existing and in good standing under the laws
of the United States, and has the full corporate power, authority and
legal right under the laws of the State of Connecticut and the United
States pertaining to its banking, trust and fiduciary powers to
execute and deliver this Agreement, the Liquidity Facilities and the
Intercreditor Agreement and to perform its obligations under this
Agreement, the Liquidity Facilities and the Intercreditor Agreement;
(ii) this Agreement, each of the Liquidity Facilities and the
Intercreditor Agreement have been duly authorized, executed and
delivered by the Subordination Agent; this Agreement, each of the
Liquidity Facilities and the Intercreditor Agreement constitute the
legal, valid and binding obligations of the Subordination Agent
enforceable against it in accordance with their respective terms,
except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
rights of creditors generally and by general principles of equity,
whether considered in a proceeding at law or in equity;
(iii) none of the execution, delivery and performance by the
Subordination Agent of each of the Liquidity Facilities, the
Intercreditor Agreement or this Agreement contravenes any law, rule
or regulation of the State of Connecticut or any United States
governmental authority or agency regulating the Subordination Agent's
banking, trust or fiduciary powers or any judgment or order
applicable to or binding on the Subordination Agent and do not
contravene or result in any breach of, or constitute a default under,
the Subordination Agent's articles of association or by-laws or any
agreement or instrument to which the Subordination Agent is a party
or by which it or any of its properties may be bound;
(iv) neither the execution and delivery by the Subordination
Agent of any of the Liquidity Facilities, the Intercreditor Agreement
or this Agreement nor the consummation by the Subordination Agent of
any of the transactions contemplated hereby or thereby requires the
consent or approval of, the giving of notice to, the registration
with, or the taking of any other action with respect to, any
Connecticut governmental authority or agency or any Federal
governmental authority or agency regulating the Subordination Agent's
banking, trust or fiduciary powers;
(v) there are no Taxes payable by the Subordination Agent
imposed by the State of Connecticut or any political subdivision or
taxing authority thereof in connection with the execution, delivery
and performance by the Subordination Agent of this Agreement, any of
the Liquidity Facilities or the Intercreditor Agreement (other than
franchise or other taxes based on or measured by any fees or
compensation received by the Subordination Agent for services rendered
in connection with the transactions contemplated by the Intercreditor
Agreement or any of the Liquidity Facilities), and there are no Taxes
payable by the Subordination Agent imposed by the State of Connecticut
or any political subdivision thereof in connection with the
acquisition, possession or ownership by the Subordination Agent of any
of the Equipment Notes (other than franchise or other taxes based on
or measured by any fees or compensation received by the Subordination
Agent for services rendered in connection with the transactions
contemplated by the Intercreditor Agreement or any of the Liquidity
Facilities);
(vi) there are no pending or threatened actions or proceedings
against the Subordination Agent before any court or administrative
agency which individually or in the aggregate, if determined adversely
to it, would materially adversely affect the ability of the
Subordination Agent to perform its obligations under this Agreement,
the Intercreditor Agreement or any Liquidity Facility;
(vii) the Subordination Agent has not directly or indirectly
offered any Equipment Note for sale to any Person or solicited any
offer to acquire any Equipment Notes from any Person, nor has the
Subordination Agent authorized anyone to act on its behalf to offer
directly or indirectly any Equipment Note for sale to any Person, or
to solicit any offer to acquire any Equipment Note from any Person;
and the Subordination Agent is not in default under any Liquidity
Facility;
(viii) the Subordination Agent is not directly or indirectly
controlling, controlled by or under common control with the Owner
Participant, the Owner Trustee or Lessee; and
(ix) [Certain Other Covenants of the Owner Participant and the
Indenture Trustee. The Owner Participant hereby unconditionally
agrees with Lessee, and only with Lessee (and not with any other party
to this Participation Agreement), that on behalf of the Owner Trustee
it will make available to the Indenture Trustee funds sufficient to
pay the Indenture Trustee the amounts (the "Deferred Equity Amounts")
set forth on the dates (the "Deferred Equity Dates") set forth in
Schedule IV attached hereto; provided, that the Owner Participant
shall not be obligated to make such funds available if an event
specified in Section 14(e), (f) or (g) of the Lease which either does,
or with the giving of notice or passage of time, or both, would
constitute an Event of Default or Lease Event of Default shall have
occurred and be continuing on the date on which such funds are to be
made available. The Owner Participant and the Owner Trustee hereby
direct the Indenture Trustee, and the Indenture Trustee hereby agrees,
to apply any such payment of Deferred Equity Amounts to the payment of
principal and interest on the Equipment Notes, as appropriate, which
may be due and payable pursuant to the provisions of the Trust
Indenture on such Deferred Equity Date. The Owner Participant agrees
to make any such payment of Deferred Equity Amounts in immediately
available funds on or before 11:00 a.m. New York City time, on the
Deferred Equity Date. The Owner Participant agrees to give Lessee
notice by 11:00 a.m., New York City time, on the Deferred Equity Date
if it has failed to make the payment of the Deferred Equity Amount due
on such date. The Indenture Trustee agrees to give Lessee notice by
12:00 noon, New York City time, on the Deferred Equity Date if it has
failed to receive the payment of the Deferred Equity Amount due on
such date. In the event the Owner Participant fails to make such
payment, Lessee shall make the Advance under Section 3(g) of the Lease
and the Owner Participant shall cause Lessor to comply with all of its
obligations under said Section 3(g). The Owner Participant agrees to
repay the amount of any Advance made pursuant to Section 3(g) of the
Lease forthwith following the making thereof together with interest at
a rate per annum equal to the Base Rate plus 2% commencing on the date
of such Advances to the date of repayment and agrees that its
obligation shall be a full recourse obligation of the Owner
Participant. All amounts paid to the Lessee by the Owner Participant
in respect of an Advance or deducted by the Lessee pursuant to Section
3(g) of the Lease shall be applied first to payment to Lessee of
interest and then to payment to Lessee of amounts equal to the
Advance.] (3)
________________________
(3) For deferred equity transactions only.
SECTION 8. RELIANCE OF LIQUIDITY PROVIDER. Each of the parties
hereto agrees and acknowledges that the Liquidity Provider shall be a third
party beneficiary of each of the representations, warranties and covenants
made herein by such party, and that the Liquidity Provider may rely on such
representations and warranties to the same extent as if such
representations and warranties were made to the Liquidity Provider
directly. Lessee agrees and acknowledges that the Liquidity Provider shall
be a third party beneficiary of the indemnities contained in Section 6(c)
hereof, and may rely on such indemnities to the same extent as if such
indemnities were made to the Liquidity Provider directly.
SECTION 9. OTHER DOCUMENTS. Each of the Owner Participant and the
Owner Trustee hereby (a) agrees with Lessee and the Loan Participants to
comply with all of the terms of the Trust Agreement (as the same may
hereafter be amended or supplemented from time to time in accordance with
the terms thereof) applicable to it; (b) agrees with Lessee and the
Indenture Trustee not to amend, supplement or otherwise modify any
provision of the Trust Agreement in a manner adversely affecting such party
without the prior written consent of such party; and (c) agrees with Lessee
and the Loan Participants not to revoke the Trust Agreement without the
prior written consent of Lessee and the Indenture Trustee. Notwithstanding
the foregoing, so long as the Lease has not been terminated, the
Subordination Agent, the Pass Through Trustee, the Indenture Trustee, the
Owner Participant and the Owner Trustee hereby agree for the benefit of
Lessee that without the consent of Lessee they will not amend, modify or
supplement the definition of "Secured Obligations" or Articles II, III, IX
or Section 5.02 of the Trust Indenture. Furthermore, so long as the Lease
has not been terminated, the Pass Through Trustee, the Subordination Agent,
the Indenture Trustee, the Owner Participant and the Owner Trustee hereby
agree for the benefit of Lessee that without Lessee's consent, each such
party will not amend any other provision of any Operative Document or Pass
Through Document in a manner adversely affecting Lessee. Each of the Owner
Participant, the Indenture Trustee, the Subordination Agent, the Pass
Through Trustee and the Owner Trustee agree to promptly furnish to Lessee
copies of any supplement, amendment, waiver or modification of any of the
Operative Documents or Pass Through Documents to which Lessee is not a
party. Each Loan Participant agrees that it will not take any action in
respect of the Trust Indenture Estate except through the Indenture Trustee
pursuant to the Trust Indenture or as otherwise permitted by the Trust
Indenture.
SECTION 10. CERTAIN COVENANTS OF LESSEE. Lessee covenants and
agrees with each of the Loan Participants, the Owner Participant, the
Indenture Trustee and the Owner Trustee, as follows:
(a) Further Assurances. Lessee will cause to be done, executed,
acknowledged and delivered all and every such further acts, conveyances and
assurances as the Owner Trustee, the Indenture Trustee or the Owner
Participant shall reasonably require for accomplishing the purposes of this
Agreement and the other Operative Documents; provided that any instrument
or other document so executed by Lessee will not expand any obligations or
limit any rights of Lessee in respect of the transactions contemplated by
any Operative Documents. Lessee, forthwith upon delivery of the Aircraft
under the Lease, shall cause the Aircraft to be duly registered, and at all
times thereafter to remain duly registered, in the name of the Owner
Trustee, except as otherwise required or permitted hereunder or under the
Lease, under the Transportation Code, or shall furnish to the Owner Trustee
such information as may be required to enable the Owner Trustee to make
application for such registration (at the expense of Lessee), and shall
promptly furnish to the Owner Trustee such information as may be required
to enable the Owner Trustee to timely file any reports required to be filed
by it as the lessor under the Lease or as the owner of the Aircraft with
any governmental authority (including tax authorities).
(b) Filings. Lessee, at its expense, will cause the Lease, all
Lease Supplements, all amendments to the Lease, the Trust Indenture, all
supplements and amendments to the Trust Indenture and this Agreement to be
promptly filed and recorded, or filed for recording, to the extent
permitted under the Transportation Code, or required under any other
applicable law. Upon the execution and delivery of the FAA Bill of Sale,
the Lease, the Lease Supplement covering the Aircraft, the Trust Supplement
and the Trust Indenture shall be filed for recording with the Federal
Aviation Administration in the following order of priority; First, the FAA
Bill of Sale, Second, the Lease, with the Lease Supplement covering the
Aircraft, the Trust Indenture and the Trust Supplement attached, and Third,
the Trust Indenture, with the Trust Supplement attached.
SECTION 11. OWNER FOR FEDERAL TAX PURPOSES. It is the intent of
the parties to this Agreement that the Lease be treated as a true lease,
the Owner Participant be treated as the owner of the Aircraft to be
delivered under the Lease, and Lessee be treated as the lessee thereof for
Federal income tax purposes.
SECTION 12. NOTICES; CONSENT TO JURISDICTION.
(a) Notices. All notices, demands, instructions and other
communications required or permitted to be given to or made upon any party
hereto shall be in writing and shall be personally delivered or sent by
registered or certified mail, postage prepaid, or by telecopier, or by
prepaid courier service, and shall be deemed to be given for purposes of
this Agreement on the day that such writing is delivered to the recipient
thereof in accordance with the provisions of this Section 12(a). Unless
otherwise specified in a notice sent or delivered in accordance with the
foregoing provisions of this Section 12(a), notices, demands, instructions
and other communications in writing shall be given to or made upon the
respective parties hereto at their respective addresses (or to their
respective telecopier numbers) as follows: (A) if to Lessee, the Owner
Trustee, the Pass Through Trustee, the Subordination Agent, the Indenture
Trustee or the Owner Participant, to the respective addresses set forth
below the signatures of such parties at the foot of this Agreement, or (B)
if to a subsequent Owner Participant, addressed to such subsequent Owner
Participant at such address as such subsequent Owner Participant shall have
furnished by notice to the parties hereto, or (C) if to any subsequent Note
Holder, addressed to such Note Holder at its address set forth in the
Equipment Note register maintained pursuant to Section 2.07 of the Trust
Indenture.
(b) Consent to Jurisdiction. Each of the parties hereto (A)
hereby irrevocably submits itself to the non-exclusive jurisdiction of the
United States District Court for the Southern District of New York and to
the non-exclusive jurisdiction of the Supreme Court of the State of New
York, New York County, for the purposes of any suit, action or other
proceeding arising out of this Agreement, the Lease, the Tax Indemnity
Agreement or any other Operative Document, the subject matter of any
thereof or any of the transactions contemplated hereby or thereby brought
by any party or parties thereto, or their successors or assigns, and (B)
hereby waives, and agrees not to assert, by way of motion, as a defense, or
otherwise, in any such suit, action or proceeding, to the extent permitted
by applicable law, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is
improper, or that this Agreement, the Lease, the Tax Indemnity Agreement or
any other Operative Document or the subject matter of any thereof or any of
the transactions contemplated hereby or thereby may not be enforced in or
by such courts; provided, however that the foregoing shall not apply to the
right any party may have to seek removal of such suit, action or proceeding
to federal court or to seek consolidation of any separate actions, suits or
proceedings brought by one or more of the other parties in the same or
different jurisdictions. The agreement set forth in this Section 12(b) is
given solely for the benefit of the parties hereto and shall not inure to
the benefit of any other Person.
SECTION 13. CHANGE OF SITUS OF OWNER TRUST. The Owner Participant
agrees that if, at any time, the Trust Estate becomes subject to any Taxes
for which it is indemnified pursuant to Section 6(b) hereof and if, as a
consequence thereof, Lessee should request that the situs of the trust be
moved to another state in the United States from the state in which it is
then located, the situs of the trust may be moved and the Owner Participant
will take whatever action may be reasonably necessary to accomplish such
removal; provided that (A) Lessee shall provide such additional tax
indemnification as the Owner Participant and the Indenture Trustee may
reasonably request, (B) the rights and obligations under the Operative
Documents of the Owner Participant and the Indenture Trustee shall not be
altered as a result of the taking of such action, (C) the lien of the Trust
Indenture on the Trust Indenture Estate shall not be adversely affected by
such action, and (D) the Owner Participant and the Indenture Trustee shall
have received an opinion or opinions of counsel (reasonably satisfactory to
the Owner Participant), in scope, form and substance satisfactory to the
Owner Participant to the effect that (I) the trust, as thus removed, shall
remain a validly established trust, (II) any amendments to the Trust
Agreement necessitated by such removal shall have been duly authorized,
executed and delivered by the parties thereto and shall constitute the
valid and binding obligations of such parties, enforceable in accordance
with their terms, (III) such removal will not result in the imposition of,
or increase in the amount of, any Tax for which Lessee is not required to
indemnify the Owner Participant, the Indenture Trustee, the Owner Trustee
or the Trust Estate pursuant to Section 6(b) hereof (taking into account
any additional indemnification provided by Lessee pursuant to clause (A) of
this sentence), and (IV) if such removal involves the replacement of the
Owner Trustee, an opinion of counsel to such successor Owner Trustee in
form and substance reasonably satisfactory to the Owner Participant
covering the matters described in the opinion delivered pursuant to Section
4(a)(xiii) and such other matters as the Owner Participant may reasonably
request, and (E) Lessee shall indemnify and hold harmless the Owner
Participant and the Indenture Trustee on a net after-tax basis against any
and all reasonable and actual costs and expenses including reasonable
counsel fees and disbursements, registration fees, recording or filing fees
and taxes incurred by the Owner Trustee, the Owner Participant and the
Indenture Trustee in connection with such change of situs. Notwithstanding
anything to the contrary contained herein or in any other Operative
Document, the Owner Participant agrees with Lessee that it will not consent
to or direct a change in the situs of the Trust Estate without the prior
consent of Lessee unless the Owner Trustee, the Indenture Trustee, the Note
Holders and the Trust Estate each waives its right to any indemnity payable
by the Lessee under Section 6(b) as a result of the change in situs.
SECTION 14. MISCELLANEOUS.
(a) Consents Under Lease. The Owner Participant covenants and
agrees that it shall not unreasonably withhold its consent to any consent
requested of the Owner Trustee, as Lessor, under the terms of the Lease
which by its terms is not to be unreasonably withheld by the Owner Trustee,
as Lessor.
(b) Survival. The representations, warranties, indemnities and
agreements of Lessee, the Owner Trustee, the Indenture Trustee, the
Subordination Agent, the Pass Through Trustee and the Owner Participant
provided for in this Agreement or any other Operative Document, and
Lessee's, the Owner Trustee's, the Indenture Trustee's, the Subordination
Agent's, the Pass Through Trustee's and the Owner Participant's obligations
under any and all thereof, shall survive the making available of the
respective Commitments by the Pass Through Trustee and the Owner
Participant, the delivery or return of the Aircraft, the transfer of any
interest of the Owner Participant in the Trust Estate or the Aircraft or
any Engine or the transfer of any interest by any Loan Participant in any
Equipment Note or the Trust Indenture Estate and the expiration or other
termination of this Agreement or any other Operative Document.
(c) Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
(d) Amendments and Waivers. Neither this Agreement nor any of
the terms hereof may be terminated, amended, supplemented, waived or
modified, except by an instrument in writing signed by the party against
which the enforcement of the termination, amendment, supplement, waiver or
modification is sought; and no such termination, amendment, supplement,
waiver or modification shall be effective unless a signed copy thereof
shall have been delivered to the Indenture Trustee and the Owner Trustee.
(e) Successors and Assigns. The terms of this Agreement shall
be binding upon, and inure to the benefit of, Lessee and, subject to the
terms of this Agreement, its successors and permitted assigns, the Pass
Through Trustee and its successors as Pass Through Trustee (and any
additional trustee appointed) under any of the Pass Through Trust
Agreements, the Owner Participant and, subject to the terms of this
Agreement, its successors and permitted assigns, each Note Holder and its
successors and registered assigns, the Indenture Trustee and its successors
as Indenture Trustee under the Trust Indenture and the Owner Trustee and
its successors as Owner Trustee under the Trust Agreement. The terms of
this Agreement shall inure to the benefit of the Liquidity Provider, its
successors and permitted assigns.
(f) Governing Law. THIS AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
(g) Trust Capacity. The parties hereto agree that all of the
statements, representations, covenants and agreements made by the Owner
Trustee (when made in such capacity) contained in this Agreement and any
agreement referred to herein 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 Agreement or such other agreements to
the contrary notwithstanding (except for any express provisions that the
Owner Trustee is responsible for in its individual capacity), no recourse
shall be had with respect to this Agreement or such other agreements
against the Owner Trustee in its individual capacity 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; provided, however, that this
Section 14(g) shall not be construed to prohibit any action or proceeding
against any party hereto for its own willful misconduct or grossly
negligent conduct for which it would otherwise be liable; and provided,
further, that nothing contained in this Section 14(g) shall be construed to
limit the exercise and enforcement in accordance with the terms of this
Agreement or such other agreements of rights and remedies against the Trust
Estate. The foregoing provisions of this Section 14(g) shall survive the
termination of this Agreement and the other Operative Documents.
(h) Section 1110. It is the intention of the parties hereto
that the Owner Trustee, as Lessor under the Lease, and the Indenture
Trustee, as assignee of such Owner Trustee's rights under the Lease
pursuant to the Trust Indenture, will be entitled to the benefits of 11
U.S.C. Section 1110 in the event of any reorganization of Lessee under
such Section.
SECTION 15. EXPENSES.
(a) Invoices And Payment. Each of the parties hereto shall
promptly submit to the Owner Trustee and Lessee for their prompt approval
(which shall not be unreasonably withheld) copies of invoices in reasonable
detail of the Transaction Expenses for which it is responsible for
providing information as they are received. The Owner Participant agrees
to transfer to the Owner Trustee promptly such amount as shall be necessary
in order to enable the Owner Trustee to pay, or if previously paid by
Lessee, to reimburse Lessee for, Transaction Expenses. To the extent of
funds received by it, the Owner Trustee agrees to pay all invoices of
Transaction Expenses that have been approved by it and Lessee promptly upon
receipt thereof and, to the extent such invoices have previously been paid
by Lessee, to reimburse Lessee promptly therefor. Notwithstanding the
foregoing, to the extent that Transaction Expenses exceed __% of Lessor's
Cost, Lessee at its sole option shall have the right to pay directly any or
all Transaction Expenses which are in excess of __% of Lessor's Cost.
(b) Payment of Other Expenses. In the event that the
transaction contemplated by this Participation Agreement fails to close as
a result of the Owner Participant's failure to negotiate in good faith or
to comply with the terms and conditions upon which its participation in the
transaction was predicated, the Owner Participant will be responsible for
all of its fees and expenses, including but not limited to the fees,
expenses and disbursements of its special counsel.
SECTION 16. REFINANCINGS.
(a) Refinancing Generally. So long as no Lease Event of
Default shall have occurred and be continuing, Lessee shall have the right
to refinance all (but not less than all) of the Equipment Notes no more
than three times by giving written notice to the Owner Participant and the
Owner Trustee that there shall be effected a voluntary redemption of the
Equipment Notes by the Owner Trustee, whereupon the Owner Participant
agrees to negotiate promptly in good faith to conclude an agreement with
Lessee as to the terms of such refinancing operation (including the terms
of any debt to be issued in connection with such refinancing); provided
that no such refinancing shall require an increase in the amount of the
Owner Participant's investment in the beneficial ownership of the Aircraft
or in the principal amount of the Equipment Notes; and provided further
that the Owner Participant may reject any terms that, in its reasonable
judgment, materially and adversely affect the Owner Participant.
Upon such agreement:
(1) within ten (10) Business Days after the reaching
of such agreement, the Owner Participant will deliver to
Lessee a certificate of an authorized representative of the
Owner Participant (the "Refinancing Certificate") setting
forth (i) (based upon information provided by Lessee and on
the agreement reached between Lessee and the Owner
Participant) the proposed date on which the outstanding
Equipment Notes will be redeemed and a description of any
new debt to be issued and the other aspects of such
refinancing that will be consummated (such date, the
"Refinancing Date") and (ii) the following information
calculated pursuant to the provisions of paragraph (6) of
this Section 16(a): (A) the proposed adjusted debt/equity
ratio, (B) the principal amount of debt to be issued by the
Owner Trustee on the Refinancing Date, (C) the amount, if
any, by which the Owner Participant's aggregate investment
in the beneficial interest in the Aircraft is to be
decreased and (D) the proposed revised schedules of Basic
Rent percentages, debt amortization, EBO Amount, Termination
Value percentages and other purchase option or termination
percentages. The Refinancing Certificate shall not provide
for a debt/equity ratio of more than [_:1]. Within fourteen
days of its receipt of the Refinancing Certificate, Lessee
may demand a verification pursuant to Exhibit E to the Lease
of the information set forth in the Refinancing Certificate.
Upon the acceptance by Lessee of the accuracy of the
information set forth in the Refinancing Certificate (or the
determination pursuant to such verification procedures), as
to the debt/equity ratio, the principal amount of debt to be
issued by the Owner Trustee on the Refinancing Date and the
revised Basic Rent percentages, debt amortization, EBO
Amount, Termination Value percentages and other buyout and
termination percentages (such information, whether as set
forth or as so determined, the "Refinancing Information")
the appropriate parties will take the actions specified in
paragraphs (2) through (5) below;
(2) the appropriate parties will enter into
appropriate documentation (which may involve an underwriting
agreement in connection with such sale or the sale of the
Owner Trustee's interest in the Trust Estate and/or the
Aircraft and its resale to the Owner Trustee) with the
institution or institutions to be named therein providing
for (A) (i) the issuance and sale by the Owner Trustee to
such institution or institutions on the Refinancing Date of
debt securities in an aggregate principal amount specified
in the Refinancing Information which amount shall be equal
to the aggregate principal amount of all Equipment Notes
outstanding on the Refinancing Date (such debt securities,
the "New Debt") except that the principal amount of New Debt
may exceed the principal amount of all outstanding Equipment
Notes in connection with the first refinancing under this
Section 16, (ii) the application of the proceeds of the sale
of the New Debt to the redemption of all such Equipment
Notes on the Refinancing Date and (iii) the payment of the
excess, if any, of such proceeds over the amounts necessary
to effect such redemption to the Owner Trustee and (B)
pursuant to which the parties to the refinancing transaction
(including the Owner Participant, the Lessee, the Owner
Trustee and the Loan Participants, but excluding the holders
of the Pass Through Certificates) make such representations,
warranties and covenants as Lessee and Owner Participant
reasonably require;
(3) Lessee shall give the notice to the Indenture
Trustee pursuant to Section 2.11 of the Trust Indenture, and
Lessee and the Owner Trustee will amend the Lease to provide
that (i) Basic Rent payable in respect of the period from
and after the Refinancing Date shall be as provided in the
Refinancing Information and (ii) amounts payable in respect
of EBO Amount and Termination Value from and after the
Refinancing Date shall be as provided in the Refinancing
Information;
(4) the Owner Trustee will enter into an agreement to
provide for the securing thereunder of the New Debt in like
manner as the Equipment Notes and will enter into such
amendments and supplements to the Trust Indenture (or such
new indenture or other security agreement) as may be
necessary to effect such refinancing;
(5) the Lessee shall pay all of the reasonable
expenses of such refinancing (including, but not limited to,
the reasonable fees, expenses and disbursements of counsel
and any placement or underwriting fees); and
(6) when calculating any of the information required
to be set forth in a Refinancing Certificate, the Owner
Participant shall make such calculations in a manner which
(A) maintains the Owner Participant's Net Economic Return
(except to the extent the assumptions referred are the
subject of the recalculations being conducted by the Owner
Participant), and (B) minimizes the Net Present Value of
Rents to Lessee to the extent possible consistent with
clause (A).
(b) Limitation on Redemption. The Equipment Notes shall not be
subject to voluntary redemption by the Owner Trustee without the consent of
Lessee except as set forth in Section 2.14 of the Trust Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective officers thereunto duly authorized
as of the day and year first above written.
US AIRWAYS, INC.,
Lessee
By:_______________________________
Name:
Title:
Address: 2345 Crystal Drive
Arlington, Virginia 22227
Attn:
Telecopy:
[OWNER PARTICIPANT],
as Owner Participant
By:_______________________________
Name:
Title:
Address:
Attn:
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity
except as otherwise provided herein,
but solely as Indenture Trustee
By:_______________________________
Name:
Title:
Address: 225 Asylum Street,
Hartford, Connecticut 06103
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual capacity, except
as expressly provided herein, but
solely as Owner Trustee
By:_______________________________
Name:
Title:
Address: 79 South Main Street, 3rd Floor
Salt Lake City, Utah 84111
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity, except
as otherwise provided herein, but
solely as Pass Through Trustee
By:_______________________________
Name:
Title:
Address: 225 Asylum Street
Hartford, Connecticut 06103
STATE STREET BANK AND
TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity, except as
otherwise provided herein, but solely as
Subordination Agent
By:_______________________________
Name:
Title:
Address: 225 Asylum Street
Hartford, Connecticut 06103
SCHEDULE I
NAMES AND ADDRESSES
Lessee: US Airways, Inc.
U.S. MAIL
2 345 Crystal Drive
Arlington, Virginia 22227
OVERNIGHT COURIER
2345 Crystal Drive
Arlington, Virginia 22227
Attn: Treasurer
Telecopy No.: (703) 872-5936
WIRE TRANSFER
[PNC Bank, N.A.]
ABA No.____________
Acct. No. ___________
Reference: __________
Owner Participant:
U.S. Mail
__________________________
__________________________
Attn:_____________________
Telecopy No.:_____________
OVERNIGHT COURIER
__________________________
__________________________
Attn:_____________________
Telecopy No.: (___) ___-____
WIRE TRANSFER
ABA No._________________
Acct. No._________________
Indenture Trustee, Pass State Street Bank and Trust Company of Connecticut,
Through Trustee and National Association
Subordination Agent:
U.S. MAIL
225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
Attn: Corporate Trust Administration
Telecopy No.: (860) 244-1889
with a copy to:
State Street Bank and Trust Company
Corporate Trust Department
2 Avenue de Lafayette, 6th Floor
Boston, Massachusetts 02111
Attn: Ruth A. Smith
Telecopy: (617) 662-1461
OVERNIGHT COURIER
225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
Attn: Corporate Trust Administration
with a copy to:
State Street Bank and Trust Company
Corporate Trust Department
2 Avenue de Lafayette, 6th Floor
Boston, Massachusetts 02111
Attn: Ruth A. Smith
WIRE TRANSFER
State Street Bank and Trust Company of Connecticut,
National Association
ABA No. ___________
Acct. No. _____________
Attn: Corporate Trust Administration
_________________
Reference: US Airways, Inc. 1999-1/US Airways,
Inc. Trust No. N___U_
Owner Trustee: First Security Bank, National Association
U.S. MAIL
79 South Main Street, 3rd Floor
Salt Lake City, Utah 84111
Attn: Corporate Trust Department
Telecopy No.: (801) 246-5053
OVERNIGHT COURIER
79 South Main Street, 3rd Floor
Salt Lake City, Utah 84111
Attn: Corporate Trust Department
Telecopy No.: (801) 246-5053
WIRE TRANSFER
First Security Bank, National Association
ABA No. ___________
Acct. No. ___________
Re: US Airways, Inc. Trust No. N___U_
SCHEDULE II
COMMITMENTS
PERCENTAGE OF
PURCHASERS INTEREST RATE
LESSOR'S COST AND MATURITY PURCHASE PRICE
--------------- --------------- --------------
US Airways, Inc.
Pass Through Trust:
1999-1A
_______% 8.36% Series A Secured
Certificates due__________ $__________
1999-1B
_______% 9.01% Series B Secured
Certificates due _________ $__________
1999-1C
______% 7.96% Series C Secured
Certificates due __________ $__________
OWNER PARTICIPANT EQUITY INVESTMENT
_____% $__________
100% Total Commitments $__________
SCHEDULE III
PASS THROUGH TRUST AGREEMENT AND PASS THROUGH TRUST SUPPLEMENTS
---------------------------------------------------------------
Pass Through Trust Agreement, dated as of July 30, 1999, between US
Airways, Inc., US Airways Group, Inc. and State Street Bank and Trust
Company of Connecticut, National Association, as supplemented by Trust
Supplement No. 1999-1A, dated as of August 31, 1999, as supplemented by
Trust Supplement No. 1999-1B, dated as of August 31, 1999, and as
supplemented by Trust Supplement No. 1999-1C, dated as of August 31, 1999.
EXHIBIT A
TO PARTICIPATION AGREEMENT
(US Airways, Inc. Trust No. N___U_)
SCHEDULE OF COUNTRIES FOR REREGISTRATION
----------------------------------------
Australia Malta
Austria Mexico
Bahamas Netherlands
Belgium New Zealand
Bermuda Norway
Brazil People's Republic of China
Canada Philippines
Denmark Portugal
Finland Republic of China (Taiwan)*
France Singapore
Germany South Korea
Grenada Spain
Greece Sweden
Iceland Switzerland
India Thailand
Ireland Tobago
Italy Trinidad
Jamaica Turkey
Japan United Kingdom
Luxembourg Venezuela
Malaysia
*So long as on the date of registration such country and the
United States have diplomatic relations at least as good as those in effect
on the Delivery Date.
Form Definitions
N___U_
ANNEX A
[FORM OF DEFINITIONS BASIC LEASE FORM]
DEFINITIONS
(US Airways, Inc. Trust No. N___U_)
The following terms shall have the following meanings for all
purposes of the Operative Documents referred to below, unless otherwise
defined in an Operative Document or the context thereof shall otherwise
require and such meanings shall be equally applicable to both the singular
and the plural forms of the terms herein defined. In the case of any
conflict between the provisions of this Annex A and the provisions of the
main body of any Operative Document, the provisions of the main body of
such Operative Document shall control the construction of such Operative
Document.
Except as otherwise provided herein, all references to any
agreement defined in this Annex A shall be deemed to include such agreement
as the same may from time to time be amended, supplemented or otherwise
modified in accordance with its terms and, where applicable, the terms of
the other Operative Documents. All references to statutes, rules and
regulations shall be deemed to include all amendments, replacements and
successors thereto unless otherwise specified herein.
["Acceptable Alternate Engine" means (i) a CFM International
Model 56-5 (or improved) type engine having not less than 1,500 cycles left
before such engine's next scheduled maintenance overhaul or (ii) an engine
of the same or another manufacturer suitable for use on the Airframe and
having a value and utility equal to or greater than a CFM Model 56-5 type
engine, assuming such engine is in the condition required by the Lease.](1)
"Acceptance Certificate" has the meaning specified for such term
in Section 4(a)(v) of the Participation Agreement.
"Actual Knowledge" means, (i) as it applies to the Owner Trustee
or Indenture Trustee, as the case may be, actual knowledge of a Responsible
Officer in the Trust Office of the Owner Trustee or in the Corporate Trust
Office of the Indenture Trustee, as the case may be, and (ii) as it applies
to the Owner Participant, actual knowledge of a vice president or other
higher officer of the Owner Participant having responsibility for the
transactions contemplated by the Operative Documents.
"Additional Insured" means Lessor, in its individual capacity and
as owner of the Aircraft, the Indenture Trustee, the Owner Participant, the
Pass Through Trustee, the Liquidity Provider, Lessee in its capacity as
sublessor under any Sublease, and each of their respective Affiliates,
successors and permitted assigns, and the respective directors, officers,
employees and agents of the foregoing.
"Additional Parts" has the meaning specified for such term in
Section 8(c) of the Lease.
----------------
(1) For A319 and A320 Aircraft; Definition for A330 Aircraft to be
determined.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control
with such Person. For the purposes of this definition, "control"
(including "controlled by" and "under common control with") shall mean the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether through the ownership of
voting securities or by contract or otherwise.
"AIFS" means Airbus Industrie Financial Services, a corporation
formed under the laws of Ireland.
"Aircraft" means the Airframe to be delivered and leased under
the Lease (or any airframe from time to time substituted for such Airframe
pursuant to Section 10(a) of the Lease) together with the two Engines
initially leased under the Lease (or any engine substituted for either of
such Engines pursuant to the terms of the Lease), in each case as specified
in the applicable Lease Supplement, whether or not any of such initial or
substituted Engines may from time to time be installed on such initial or
substituted Airframe or may be installed on any other airframe or on any
other aircraft.
"Airframe" means: (i) the Airbus aircraft (except Engines or
engines from time to time installed thereon) specified in the initial Lease
Supplement, which aircraft shall be leased by Lessor to Lessee under the
Lease and under such Lease Supplement, and any aircraft (except Engines or
engines from time to time installed thereon) which may from time to time be
substituted for such aircraft (except Engines or engines from time to time
installed thereon) pursuant to clause (ii) of the first paragraph of
Section 10(a) of the Lease; and (ii) any and all Parts (A) so long as the
same shall be incorporated or installed in or attached to such aircraft
(except Engines or engines from time to time installed thereon), or (B) so
long as title thereto shall remain vested in Lessor in accordance with the
terms of Section 8 of the Lease after removal from such aircraft (except
Engines or engines from time to time installed thereon); provided, however,
that at such time as an aircraft (except Engines or engines from time to
time installed thereon) shall be deemed part of the property leased under
the Lease in substitution for the Airframe pursuant to the applicable
provisions of the Lease, the replaced Airframe shall cease to be an
Airframe under the Lease; provided further that the Airframe shall not
include Passenger Convenience Equipment.
"Amortization Amount" means, with respect to any Principal Amount
Repayment Date, the amount set forth opposite such Date as the Principal
Amount to be repaid on the Amortization Schedule.
"Amortization Schedule" means the amortization schedule for the
Equipment Notes delivered pursuant to Section 2.02 of the Trust Indenture.
"Applicable Rate" means as of any date the weighted average of
the interest rates borne by the Equipment Notes then outstanding and, if no
Equipment Notes shall be outstanding, the Base Rate.
"Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as
amended, or any subsequent legislation that amends, supplements or
supersedes such provisions.
"Base Rate" means the rate of interest announced publicly by The
Chase Manhattan Bank from time to time as its base rate.
"Basic Rent" means, for the Basic Term, the rent payable for the
Aircraft pursuant to Section 3(b) of the Lease as adjusted as provided in
Section 3(c) of the Lease but subject always to the provisions of Section
3(c)(v) of the Lease and, for any Renewal Term, Basic Rent determined
pursuant to Section 19 of the Lease.
"Basic Term" means the term for which the Aircraft is leased
pursuant to Section 3(a) of the Lease, commencing on the Delivery Date and
ending on the Basic Term Expiration Date.
"Basic Term Expiration Date" means ______________________, or
such earlier date as the Lease may be terminated in accordance with the
provisions thereof.
"Bill of Sale" means a full warranty bill of sale covering the
Aircraft, executed by Lessee in favor of the Owner Trustee, dated the
Delivery Date, specifically referring to the Airframe and each Engine,
which Bill of Sale shall contain, among other things, a statement that such
Bill of Sale thereby conveys to the Owner Trustee good title to the
Airframe and each Engine described in such Bill of Sale, free and clear of
all liens, encumbrances and rights of others except Permitted Liens
described in Section 6(a)(xv) of the Participation Agreement.
"Burdensome Termination Event" means an event which shall be
deemed to have occurred if (A) one or more events have occurred which give
rise to an obligation on the part of Lessee to pay or indemnify any costs
or expenses under Sections 6(b) or 6(c) of the Participation Agreement or
under the Tax Indemnity Agreement if the aggregate amount of such indemnity
or other payments would exceed (as to future payments on a present value
basis discounted at the Debt Rate) 2.50% of Lessor's Cost or (B) Lessee
plans non-severable improvements to the Aircraft which (i) are necessary or
desirable in Lessee's sole discretion, (ii) are expected to cost in excess
of $2.5 million and (iii) the Owner Participant will not permit to be
financed under similar terms then available in the market for similar
transaction.
"Business Day" means any day other than a Saturday or Sunday or a
day on which commercial banks are required or authorized to close in the
City of New York, New York, Hartford, Connecticut, Pittsburgh, Pennsylvania
or the city and state where the office of the Owner Trustee is located.
"Cash Equivalents" means (i) direct obligations of the United
States of America and agencies guaranteed by the United States government
having a final maturity of ninety (90) days or less from date of purchase
thereof; (ii) certificates of deposit issued by, bankers' acceptances of,
or time deposits with, any bank, trust company or national banking
association incorporated under the laws of the United States of America or
one of the states thereof having combined capital and surplus and retained
earnings as of its last report of condition of at least $500,000,000 and
having a rating of Aa or better by Moody's Investors Service, Inc.
("Moody's") or AA or better by Standard & Poor's Corporation ("S&P") and
having a final maturity of ninety (90) days or less from date of purchase
thereof; and (iii) commercial paper of any holding company of a bank, trust
company or national banking association described in (ii) and commercial
paper of any corporation or finance company incorporated or doing business
under the laws of the United States of America or any state thereof having
a rating assigned to such commercial paper of A1 by S&P or P1 by Moody's
and having a final maturity of ninety (90) days or less from the date of
purchase thereof; provided, however, that the aggregate amount at any one
time so invested in certificates of deposit issued by any one bank shall
not be in excess of 5% of such bank's capital and surplus.
"Certificated Air Carrier" means a Citizen of the United States
holding a carrier operating certificate issued by the Secretary of
Transportation pursuant to Chapter 447 of Title 49, United States Code, for
aircraft capable of carrying ten or more individuals or 6,000 pounds or
more of cargo or that otherwise is certified or registered to the extent
required to fall within the purview of 11 U.S.C. Section 1110 or any
analogous successor provision of the Bankruptcy Code.
"Citizen of the United States" has the meaning specified for such
term in Section 40102(a)(15) of Title 49 of the United States Code or any
similar legislation of the United States of America enacted in substitution
or replacement therefor.
"Civil Reserve Air Fleet Program" means the Civil Reserve Air
Fleet Program currently administered by the United States Air Force Air
Mobility Command pursuant to Executive Order No. 11490, as amended, or any
substantially similar program.
"Class A Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class B Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class C Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class C Purchase Agreement" means that certain Purchase
Agreement, dated as of August 31, 1999, by and between Lessee and AIFS.
"Class C Special Indemnity Event" means the existence of any
condition or event which, pursuant to Section 3 of the Registration
Agreement, requires US Airways, Inc. to pay liquidated damages to the US
Airways Pass Through Trust 1999-1C in accordance with such Section 3,
subject to the last sentence of the first paragraph of Section 3 of the
Registration Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commitment" means the commitment pursuant to the Participation
Agreement of a Pass Through Trustee or of the Owner Participant, as the
case may be, to finance the Owner Trustee's payment of Lessor's Cost for
the Aircraft.
"Consent and Agreement" means, collectively, each Consent and
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the date of the
Lease, executed by the Seller and the Manufacturer, respectively, as the
same may be amended, modified or supplemented from time to time in
accordance with the applicable provisions thereof.
"Continuous Stay Period" has the meaning specified for such term
in Section 4.04(a) of the Trust Indenture.
"Corporate Trust Office" means the principal office of the
Indenture Trustee located at 225 Asylum Street, Goodwin Square, Hartford,
Connecticut 06103, Attention: Corporate Trust Administration, or such
other office at which the Indenture Trustee's corporate trust business
shall be administered which the Indenture Trustee shall have specified by
notice in writing to Lessee, the Owner Trustee, the Loan Participants and
each Note Holder.
"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 or for the deferred purchase
price of property, goods or services.
"Debt Rate" means, with respect to any Series, the rate per annum
specified for such Series under the heading "Interest Rate" in Schedule I
to the Trust Indenture.
"Default" means any event or condition that with the giving of
notice or the lapse of time or both would become an Event of Default or
Lease Event of Default (excluding Lease Events of Default related to
Excluded Payments).
"Delivery Date" means the date of the initial Lease Supplement
for the Aircraft, which date shall be the date the Aircraft is leased by
Lessor to Lessee and accepted by Lessee under the Lease.
"Delivery Notice" means the notice of delivery delivered pursuant
to Section 2(c) of the Participation Agreement.
"Depositary" means ABN AMRO Bank, N.V., acting through its
Chicago branch, as Class A Depositary, Class B Depositary and Class C
Depositary under the Deposit Agreements, or any successor thereto.
"Deposit Agreements" means, collectively, (i) that certain
Deposit Agreement (Class A), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary, (ii) that certain
Deposit Agreement (Class B), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary and (iii) that certain
Deposit Agreement (Class C), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary.
"Depreciation Period" means the period commencing on the Delivery
Date and ending at the end of the calendar year during which the seventh
(7th) anniversary of the Delivery Date occurs, or such earlier date as the
Lease may be terminated in accordance with the provisions of the Lease.
"Dollars" and "$" mean the lawful currency of the United States
of America.
"EBO Amount" means the applicable amount for the relevant EBO
Date set forth on Exhibit D to the Lease (as such Exhibit D may be adjusted
from time to time as provided in Section 3(c) of the Lease or as expressly
provided in any Operative Document).
"EBO Date" means the applicable date set forth on Exhibit D to
the Lease.
"Enforcement Date" has the meaning specified for such term in
Section 4.03 of the Trust Indenture.
"Engine" means (i) each of the two [CFM International 56-5](2)
[Pratt & Whitney](3) type engines listed by manufacturer's serial number in
the initial Lease Supplement, whether or not from time to time thereafter
installed on the Airframe or installed on any other airframe or on any
other aircraft; and (ii) any Acceptable Alternate Engine that may from time
to time be substituted, pursuant to the terms of the Lease, for either of
such two engines, together in each case with any and all Parts incorporated
or installed in or attached thereto or any and all Parts removed therefrom
so long as title thereto shall remain vested in Lessor in accordance with
the terms of Section 8 of the Lease after removal from such Engine;
provided, however, that at such time as an engine shall be deemed part of
the property leased under the Lease in substitution for an Engine pursuant
to the applicable provisions of the Lease, the replaced Engine shall cease
to be an Engine under the Lease. The term "Engines" means, as of any date
of determination, all Engines then leased under the Lease.
- -------------------
(2) For A319 and A320 Aircraft
(3) For A330 Aircraft
"Equipment Note Register" has the meaning specified for such term
in Section 2.07 of the Indenture.
"Equipment Note Registrar" has the meaning specified for such
term in Section 2.07 of the Indenture.
"Equipment Notes" means and include any Equipment Notes issued
under the Trust Indenture, and issued in exchange therefor or replacement
thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of the Participation Agreement and any subsequent
provisions of ERISA, amendatory thereof, supplemental thereto or
substituted therefor.
"Escrow Agreements" means, collectively, (i) that certain Escrow
and Paying Agent Agreement (Class A), dated as of August 31, 1999, among
First Security Bank, National Association, as escrow agent, the
Underwriters, the Pass Through Trustee, and State Street Bank and Trust
Company of Connecticut, National Association, as paying agent thereunder,
(ii) that certain Escrow and Paying Agent Agreement (Class B), dated as of
August 31, 1999, among First Security Bank, National Association, as escrow
agent, the Underwriters, the Pass Through Trustee, and State Street Bank
and Trust Company of Connecticut, National Association, as paying agent
thereunder and (iii) that certain Escrow and Paying Agent Agreement (Class
C), dated as of August 31, 1999, among First Security Bank, National
Association, as escrow agent, the Underwriters, the Pass Through Trustee,
and State Street Bank and Trust Company of Connecticut, National
Association, as paying agent thereunder.
"Event of Default" (i) when such term is used in or with respect
to the Lease has the meaning specified for such term in Section 14 of the
Lease and (ii) when such term is used in or with respect to the Trust
Indenture has the meaning specified for such term in Section 4.02 of the
Trust Indenture.
"Event of Loss" means, with respect to the Aircraft, Airframe or
any Engine, any of the following events with respect to such property: (i)
the loss of such property or of the use thereof due to the destruction of
or damage to such property which renders repair uneconomic or which renders
such property permanently unfit for normal use by Lessee (or any Sublessee)
for any reason whatsoever; (ii) any damage to such property which results
in an insurance settlement with respect to such property on the basis of a
total loss, or a constructive or compromised total loss; (iii) the theft or
disappearance of such property for a period in excess of one hundred eighty
(180) days or, if earlier, the expiration of the Term; (iv) the requisition
for use of such property by any governmental authority (other than a
requisition for use by the United States Government or any government of
registry of the Aircraft or any agency or instrumentality thereof) that
shall have resulted in the loss of possession of such property by Lessee
(or any Sublessee) for a period in excess of one hundred eighty (180)
consecutive days or, if earlier, the expiration of the Term; (v) the
requisition for use by the United States Government or any government of
registry of the Aircraft or any instrumentality or agency thereof, which
shall have occurred during the Basic Term (or any Renewal Term) and shall
have continued for a period of thirty (30) days beyond the Term, provided,
however, that no Event of Loss pursuant to this clause (v) shall exist if
Lessor shall have furnished to Lessee the written notice specified in
Section 10(d) of the Lease; (vi) condemnation, confiscation, requisition or
taking of title of the Aircraft or the Airframe for more than thirty (30)
days, or if earlier, the expiration of the Term; (vii) as a result of any
law, rule, regulation, order or other action by the Federal Aviation
Administration or other governmental body of the government of registry of
the Aircraft having jurisdiction, the use of such property in the normal
course of the business of air transportation shall have been prohibited for
a period of one hundred eighty (180) consecutive days, unless Lessee (or
Sublessee) shall have undertaken and shall be diligently carrying forward
all steps which are necessary or desirable to permit the normal use of such
property by Lessee (or such Sublessee), but in any event an "Event of Loss"
shall occur if such "grounding" extends for a period of more than three
hundred sixty (360) days (or, if earlier, the expiration of the Term);
provided that no Event of Loss shall be deemed to occur if such "grounding"
is applicable to Lessee's entire fleet of [A319][A320][A330] aircraft and
Lessee, prior to the expiration of one year from the prohibition of such
use, shall have conformed at least one such aircraft in its fleet to the
requirements of any such law, rule, regulation, order or other action and
commenced regular commercial use of the same in such jurisdiction and shall
be diligently carrying forward, on a non-discriminatory basis, all steps
which are necessary or desirable to permit the normal use of the Aircraft
by Lessee (or such Sublessee), but in any event an "Event of Loss" shall be
deemed to have occurred if such use shall have been prohibited for a period
of two consecutive years or such use shall be prohibited at the expiration
of the Term; and (viii) with respect to an Engine only, any divestiture of
title to or interest in an Engine or any event with respect to an Engine
that is deemed to be an Event of Loss with respect to such Engine pursuant
to Section 7(b) of the Lease. An Event of Loss with respect to the
Aircraft shall be deemed to have occurred if an Event of Loss occurs with
respect to the Airframe.
"Excluded Payments" means (i) indemnity payments paid or payable
by Lessee to or in respect of the Owner Participant or the Owner Trustee in
its individual capacity, their respective Affiliates, successors and
permitted assigns and their directors, officers, employees, servants and
agents (collectively, the "Owner Indemnitees") pursuant to Sections 6(b),
6(c), 15 or 16 of the Participation Agreement, (ii) proceeds of public
liability insurance in respect of the Aircraft payable as a result of
insurance claims made, or losses suffered, by the Owner Trustee or the
Indenture Trustee in their respective individual capacities or by any of
the Owner Indemnitees, (iii) proceeds of insurance maintained with respect
to the Aircraft by the Owner Participant (whether directly or through the
Owner Trustee) or any other Owner Indemnitee and permitted under Section 11
of the Lease in Exhibit H thereto, (iv) all payments required to be made
under the Tax Indemnity Agreement by Lessee and all payments of
Supplemental Rent by Lessee in respect of any amounts payable under the Tax
Indemnity Agreement, (v) fees payable to the Owner Trustee or the Indenture
Trustee, (vi) provided that the Equipment Notes shall have been duly
assumed by Lessee pursuant to Section 2.13 of the Trust Indenture, the
amounts payable to the Owner Trustee pursuant to Section 19(b) of the Lease
plus all reasonable expenses incurred by the Owner Trustee and the Owner
Participant in connection with such assumption, as applicable, (vii)
interest accrued on any of the above, and (viii) any right to enforce the
payment of any amount described in clauses (i) through (vii) above
(provided the rights referred to in this clause (viii) shall not be deemed
to include the exercise of any remedies provided for in the Lease other
than the right to sue for specific performance of any covenant or to make
such payment or to sue for damages in respect of the breach of any such
covenant) and the right to declare an Event of Default in respect of any of
the foregoing amounts. Solely for purposes of the Granting Clause of the
Trust Indenture, amounts payable to AIFS under Section 6(d) of the
Participation Agreement shall be considered Excluded Payments.
"Expenses" means all liabilities, obligations, losses, damages,
settlements, penalties, claims, actions, suits, costs, expenses and
disbursements (including, without limitation, reasonable fees and
disbursements of legal counsel, accountants, appraisers, inspectors or
other professionals and reasonable costs of investigation).
"Fair Market Renewal Term" has the meaning specified for such
term in Section 19(a)(2) of the Lease.
"FAA Bill of Sale" means a bill of sale for the Aircraft on AC
Form 8050-2 or such other form as may be approved by the Federal Aviation
Administration on the Delivery Date for the Aircraft, executed by Lessee in
favor of the Owner Trustee and dated the Delivery Date.
"Federal Aviation Administration" and "FAA" mean the United
States Federal Aviation Administration and any agency or instrumentality of
the United States government succeeding to their functions.
"Federal Funds Rate" means a fluctuating interest rate per annum
in effect from time to time, which rate per annum shall at all times be
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by State Street from three Federal funds brokers of
recognized standing selected by it.
"Fixed Renewal Term" has the meaning specified for such term in
Section 19(a)(1) of the Lease.
"Foreign Air Carrier" means any air carrier which is not a U.S.
Air Carrier and which performs, or contracts for the performance of,
maintenance, preventative maintenance and inspections for the Aircraft,
Airframe and/or any Engine or engine to standards which are approved by, or
which are substantially equivalent to those required by, the Federal
Aviation Administration or any Permitted Foreign Air Authority.
"French Pledge Agreement" means the French Pledge Agreement (US
Airways, Inc. Trust No. N___U_), dated as of the date of the Lease,
between the Owner Trustee and the Indenture Trustee, as the same may be
amended, supplemented or modified from time to time.
"Government Entity" means (a) any federal, state, provincial or
similar government, and any body, board, department, commission, court,
tribunal, authority, agency or other instrumentality of any such government
or otherwise exercising any executive, legislative, judicial,
administrative or regulatory functions of such government or (b) any other
government entity having jurisdiction over any matter contemplated by the
Operative Documents or relating to the observance or performance of the
obligations of any of the parties to the Operative Documents.
"Indemnitee" means (i) the Owner Trustee, in its individual
capacity and as trustee under the Trust Agreement, (ii) the Indenture
Trustee, (iii) the Owner Participant, (iv) the Trust Estate, (v) the Loan
Participants and each other Note Holder, (vi) the Subordination Agent,
(vii) the Liquidity Provider, (viii) the Pass Through Trustees, (ix) each
Affiliate of the Persons described in clauses (i) through (iv), inclusive,
(x) each Affiliate of the Persons described in clauses (vi), (vii) and
(viii), (xi) the respective directors, officers, employees, agents and
servants of each of the Persons described in clauses (i) through (viii),
inclusive, (xii) the successors and permitted assigns of the Persons
described in clauses (i) through (iv), inclusive, and (xiii) the successors
and permitted assigns of the Persons described in clauses (v), (vi), (vii)
and (viii).
"Indemnity Agreement" means that certain Indemnity Agreement,
dated as of August 31, 1999, between the Depositary and Lessee.
"Indenture Agreements" means the Participation Agreement, the
Lease, the Purchase Agreement, the Purchase Agreement Assignment, the
Consent and Agreement, the Bills of Sale and any other contract, agreement
or instrument from time to time assigned or pledged under the Trust
Indenture.
"Indenture Event of Default" has the meaning given the term
"Event of Default" in the Trust Indenture.
"Indenture Excess Amount" has the meaning specified for such term
in Section 2.03(b) of the Trust Indenture.
"Indenture Indemnitees" means (i) State Street and the Indenture
Trustee, (ii) each separate or additional trustee appointed pursuant to the
Trust Indenture, (iii) the Subordination Agent, (iv) the Liquidity
Provider, (v) each Pass Through Trustee, and (vi) each of the respective
directors, officers, employees, agents and servants of each of the Persons
described in clauses (i) through (v), inclusive.
"Indenture Trustee" means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its individual capacity, but solely as Indenture Trustee, and any entity
which may from time to time be acting as indenture trustee under the Trust
Indenture.
"Indenture Trustee Documents" means the Participation Agreement,
the Trust Indenture and the French Pledge Agreement and any other
agreements between the Indenture Trustee and any other party to the
Participation Agreement relating to the Transactions, delivered on the
Delivery Date.
"Indenture Trustee Event" means either (i) the Equipment Notes
shall have become due and payable pursuant to Section 4.04(b) of the Trust
Indenture, (ii) the Indenture Trustee has taken action or notified Owner
Trustee that it intends to take action to foreclose the Lien of the Trust
Indenture or otherwise commence the exercise of any significant remedy
under the Trust Indenture or the Lease or (iii) in the event of a
reorganization proceeding involving Lessee under Chapter 11 of the
Bankruptcy Code, (A) the trustee in such proceeding or Lessee not assuming
or agreeing to perform its obligations under the Lease, as contemplated
under Section 1110, during the 60-day period under Section 1110(a)(1)(A) of
the Bankruptcy Code (or such longer period as may apply under Section
1110(b) of the Bankruptcy Code) or (B) at any time after agreeing to
perform or assuming such obligations, such trustee or Lessee ceasing to
perform such obligations with the result that the Continuous Stay Period
comes to an end.
"Indenture Trustee's Liens" means any Lien which arises as a
result of (A) claims against the Indenture Trustee not related to its
interest in the Aircraft or the administration of the Trust Estate pursuant
to the Trust Indenture, (B) acts of the Indenture Trustee not permitted by,
or failure of the Indenture Trustee to take any action required by, the
Operative Documents to the extent such acts arise or such failure arises
from or constitutes gross negligence or willful misconduct, (C) claims
against the Indenture Trustee relating to Taxes or Expenses which are
excluded from the indemnification provided by Section 6 of the
Participation Agreement pursuant to said Section 6, or (D) claims against
the Indenture Trustee arising out of the transfer by the Indenture Trustee
of all or any portion of its interest in the Aircraft, the Trust Estate,
the Trust Indenture Estate or the Operative Documents other than a transfer
of the Aircraft pursuant to Section 9, 10 or 19 of the Lease or Article IV
or V of the Trust Indenture, or a transfer of the Aircraft pursuant to
Section 15 of the Lease while an Event of Default is continuing and prior
to the time that the Indenture Trustee has received all amounts due
pursuant to the Trust Indenture.
"Intercreditor Agreement" means that certain Intercreditor
Agreement, dated as of August 31, 1999, among the Pass Through Trustees,
the Liquidity Provider and the Subordination Agent.
"Insurance Brokers" has the meaning specified for such term in
Exhibit H to the Lease.
"Law" means (a) any constitution, treaty, statute, law,
regulation, order, rule or directive of any Government Entity, and (b) any
judicial or administrative interpretation or application of, or decision
under, any of the foregoing.
"Lease" means that certain Lease Agreement (US Airways, Inc.
Trust No. N___U_), dated as of _________ __, ____, entered into by the
Owner Trustee and Lessee concurrently with the execution and delivery of
the Trust Indenture, as said Lease Agreement has been, or 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 of the Trust
Indenture. The term "Lease" shall also include each Lease Supplement from
time to time entered into pursuant to the terms of the Lease.
"Lease Default" means any event which with the giving of notice
or the lapse of time or both would become a Lease Event of Default.
"Lease Event of Default" means an "Event of Default" as defined
in Section 14 of the Lease.
"Lease Period" means each of the consecutive periods throughout
the Basic Term and any Renewal Term ending on a Lease Period Date, the
first such period commencing on and including the Delivery Date.
"Lease Period Date" means ___________, 2000 and each succeeding
January 20 and July 20, to and including the last such date in the Term.
"Lease Supplement" means a Lease Supplement, substantially in the
form of Exhibit A to the Lease, to be entered into between Lessor and
Lessee on the Delivery Date for the purpose of leasing the Aircraft under
and pursuant to the terms of the Lease, and any subsequent Lease Supplement
entered into in accordance with the terms of the Lease.
"Lessee" means US Airways, Inc., a Delaware corporation.
"Lessee Documents" means the Participation Agreement, the Lease,
the Lease Supplement covering the Aircraft, the Purchase Agreement (insofar
as it relates to the Aircraft), the FAA Bill of Sale, the Bill of Sale, the
Purchase Agreement Assignment, the Tax Indemnity Agreement and each other
agreement between the Lessee and any other party to the Lease delivered on
the Delivery Date.
"Lessor" means First Security Bank, National Association, not in
its individual capacity, but solely as Owner Trustee, or any of its
successors and permitted assigns acting as lessor under the Lease.
"Lessor Liens" means any Lien or disposition of title or interest
arising as a result of (i) claims against Lessor, First Security Bank,
National Association, in its individual capacity, or the Owner Participant
not related to the transactions contemplated by the Operative Documents,
(ii) any act or omission of the Owner Participant, Lessor, or First
Security Bank, National Association, in its individual capacity, which is
not related to the transactions contemplated by the Operative Documents or
is in violation of any of the terms of the Operative Documents, (iii)
claims against the Owner Participant, Lessor, or First Security Bank,
National Association, in its individual capacity, with respect to Taxes or
Expenses against which Lessee is not required to indemnify the Owner
Participant, Lessor or First Security Bank, National Association, in its
individual capacity, pursuant to Section 6 of the Participation Agreement
or (iv) claims against Lessor or the Owner Participant arising out of any
transfer by Lessor or the Owner Participant of all or any portion of the
respective interests of Lessor or the Owner Participant in the Aircraft,
the Trust Estate or the Operative Documents other than the transfer of
possession of the Aircraft by Lessor pursuant to the Lease, the transfer
pursuant to the Trust Indenture or a transfer of the Aircraft pursuant to
Section 9, 10, 19 or 20 of the Lease or pursuant to the exercise of the
remedies set forth in Section 15 of the Lease.
"Lessor's Cost" for the Aircraft means the amount denominated as
such in Exhibit B to the Lease.
"Lien" means any mortgage, pledge, lien, charge, claim,
encumbrance, lease, sublease, sub-sublease or security interest.
"Liquidity Facilities" means the three Revolving Credit
Agreements, each dated as of August 31, 1999, between the Subordination
Agent, as borrower, and the Liquidity Provider, and any replacement
thereof, in each case as the same may be amended, modified or supplemented.
"Liquidity Provider" means AIG Matched Funding Corp., as Class A
Liquidity Provider, Class B Liquidity Provider and Class C Liquidity
Provider under the Liquidity Facilities, or any successor thereto.
"Loan Participant" means each Purchaser and its respective
successors and registered assigns, including any Note Holder.
"Loan Participant Liens" means any Lien which arises from acts or
claims against any Loan Participant not related to the transactions
contemplated by the Operative Documents.
"Loss Payment Date" has the meaning specified for such term in
Section 10(a) of the Lease.
"Majority in Interest of Note Holders" as of a particular date of
determination means the holders of more than a majority in aggregate unpaid
Principal Amount of all Equipment Notes outstanding as of such date
(excluding 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 Trust Indenture (unless all
Equipment Notes then outstanding shall be held by the Owner Trustee or the
Owner Participant) or 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 Treasury Yield
exceeds (b) the outstanding principal amount of such Equipment Note plus
accrued interest. For purposes of determining the Make-Whole Amount,
"Treasury Yield" means, at the time of determination, 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 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 and (B) the other maturing as close as possible
to, but later than, the Average Life Date, 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 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. "Average Life Date" means,
for each Equipment Note to be redeemed, 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.
"Manufacturer" means Airbus Industrie G.I.E., a groupement
d'interet economique established under Ordonnance No. 67-821 dated
September 23, 1967 of the Republic of France, and its successors and
assigns.
"Manufacturer Documents" means the Purchase Agreement and the
Consent and Agreement.
"Mortgaged Property" has the meaning specified for such term in
Section 3.03 of the Trust Indenture.
"Multiplier" means (i) on any date when no Class C Special
Indemnity Event is continuing , 0.00, (ii) on each day during the first
ninety (90)-day period immediately following the occurrence of a Class C
Special Indemnity Event, 0.0025, and (iii) thereafter, on each day during
each subsequent ninety (90)-day period for so long as such Class C Special
Indemnity Event exists, the Multiplier in effect for the immediately
preceding ninety (90)-day period plus 0.0025; provided, that (a)
notwithstanding the foregoing, the maximum Multiplier shall be 0.01, and
(b) the Multiplier shall reset after such Class C Special Indemnity Event
has ceased or no longer exists and clause (i) shall apply again to any
subsequent Class C Special Indemnity Event.
"Net Economic Return" has the meaning specified for such term in
paragraph 2 of Exhibit E to the Lease.
"Net Present Value of Rents" means the net present value, as of
the date of calculation, of Basic Rent set forth in Exhibit B to the Lease,
discounted at an annual interest rate of ten percent (10%) on a semi-annual
basis.
"New Debt" has the meaning specified for such term in Section
16(a) of the Participation Agreement.
"Non-U.S. Person" means any Person other than a U.S. Person.
"Note Holder" means any holder from time to time of one or more
Equipment Notes.
"Note Purchase Agreement" means the Note Purchase Agreement dated
as of the Pass Through Trust Closing Date among Lessee, the Pass Through
Trustee for the Class A, Class B and Class C Pass Through Trusts, the
Subordination Agent, First Security Bank, National Association, as Escrow
Agent, and State Street Bank and Trust Company of Connecticut, National
Association, as Paying Agent.
"Obsolete Parts" has the meaning specified for such term in
Section 8(c) of the Lease.
"Operative Documents" means, collectively, the Participation
Agreement, the Lease, the Trust Indenture, the Trust Agreement, an
acceptance certificate covering the Aircraft in the form agreed to by the
Participants and Lessee, the Tax Indemnity Agreement, the Lease Supplement
covering the Aircraft, the Trust Supplement covering the Aircraft, the
Equipment Notes, the Bill of Sale, the FAA Bill of Sale, the French Pledge
Agreement, the Purchase Agreement (insofar as it relates to the Aircraft),
the Purchase Agreement Assignment and the Consent and Agreement (each, an
"Operative Document").
"Operative Indentures" means each of the indentures under which
notes have been issued and purchased by the Pass Through Trustees.
"Owner Indemnitee" has the meaning specified for such term in the
definition of Excluded Payments.
"Owner Participant" means ___________________, a [_____________]
corporation, so long as such party shall have any interest in the Trust
Estate, and transferees thereof as permitted by Section 7(k) of the
Participation Agreement and Section 8.01 of the Trust Agreement.
"Owner Participant Documents" means the Participation Agreement,
the Trust Agreement, and the Tax Indemnity Agreement and each other
agreement between the respective parties thereto relating to the subject
matter thereof, delivered on the Delivery Date.
"Owner Trustee" means First Security Bank, National Association,
not in its individual capacity but solely as owner trustee, and any entity
appointed as successor Owner Trustee pursuant to Section 9.01 of the Trust
Agreement, and references to a predecessor Owner Trustee in its individual
capacity by name in the Operative Documents shall include such successor
Owner Trustee in its individual capacity from and after such succession.
"Owner Trustee Documents" means the Participation Agreement, the
Trust Agreement, the Trust Supplement covering the Aircraft, the Lease, the
Lease Supplement covering the Aircraft, the Purchase Agreement Assignment,
the French Pledge Agreement, the Trust Indenture and the Equipment Notes
and each other agreement between the respective parties thereto relating to
the subject matter thereof, delivered on the Delivery Date.
"Owner Trustee's pro rata share" has the meaning specified for
such term in the Trust Indenture.
"Participants" means the Loan Participants and the Owner
Participant, collectively (each individually, a "Participant").
"Participation Agreement" means that certain Participation
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the dated of
the Lease, among the Owner Trustee, the Subordination Agent, the Indenture
Trustee, Lessee, the Owner Participant and the Pass Through Trustee, as the
same may from time to time be supplemented or further amended, or the terms
thereof waived or modified, to the extent permitted by, and in accordance
with, the terms thereof.
"Parts" means all appliances, parts, instruments, appurtenances,
accessories, furnishings and other equipment of whatever nature (other than
(a) complete Engines or engines, (b) any items leased by Lessee from a
third party (other than Lessor) and (c) cargo containers) which may from
time to time be incorporated or installed in or attached to the Airframe or
any Engine or so long as title thereto shall remain vested in Lessor in
accordance with Section 8 of the Lease after removal therefrom; provided
that "Parts" shall not include Passenger Convenience Equipment.
"Pass Through Certificates" means the pass through certificates
to be issued by the Pass Through Trustee in connection with the
Transactions.
"Pass Through Documents" means the Participation Agreement, the
Pass Through Trust Agreements, the Note Purchase Agreement, the Deposit
Agreements, the Escrow Agreements, the Liquidity Facilities and the
Intercreditor Agreement.
"Pass Through Indemnitees" means (i) the Subordination Agent, the
Liquidity Provider and the Pass Through Trustee, (ii) each Affiliate of a
Person described in the preceding clause (i), (iii) the respective
directors, officers, employees, agents and servants of each of the Persons
described in the preceding clauses (i) and (ii), and (iv) the successors
and permitted assigns of the Persons described in the preceding clauses
(i), (ii) and (iii).
"Pass Through Trust" means, collectively, the three separate
grantor trusts set forth in Schedule III to the Participation Agreement
created, pursuant to the Pass Through Trust Agreement, to facilitate
certain of the transactions contemplated by the Operative Documents.
"Pass Through Trust Agreement" means the pass through trust
agreement and each of the three separate pass through trust supplements
referred to on Schedule III to the Participation Agreement.
"Pass Through Trust Closing Date" means August 31, 1999.
"Pass Through Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, a national banking association, in
its capacity as trustee under each Pass Through Trust Agreement, and each
other Person that may from time to time be acting as successor trustee
under any such Pass Through Trust Agreement.
"Passenger Convenience Equipment" means available components or
systems installed on or affixed to the Airframe that are used to provide
individual telecommunications or electronic entertainment to passengers
aboard the Aircraft.
"Past Due Rate" has the meaning specified for such term in
Exhibit B to the Lease.
"Payment Date" means each January 20 and July 20, commencing on
________, ____ (or, if any such day is not a Business Day, the immediately
succeeding Business Day) until the Equipment Notes have been paid in full.
"Permitted Foreign Air Authority" means the Civil Aviation
Authority of the United Kingdom, the Direction Generale de l'Aviation
Civile of the French Republic, the Luftfahrt Bundesamt of the Federal
Republic of Germany, the Rijflauchtraatdienst of the Kingdom of the
Netherlands, the Ministry of Transportation of Japan or the Federal
Ministry of Transport of Canada (and any agency or instrumentality of the
applicable government succeeding to the functions of any of the foregoing
entities).
"Permitted Lien" means any Lien referred to in clauses (i)
through (viii) of Section 6 of the Lease.
"Permitted Sublessee" means any entity domiciled in a country
listed in Exhibit F to the Lease as in effect from time to time and as may
be modified in accordance with Section 7(d) of the Participation Agreement.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"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" means the [Sale and Purchase Agreement,
dated as of October 31, 1997, between the Seller and US Airways Group,
Inc.,](4) [Purchase Agreement dated as of November 24, 1998 between US
Airways Group, Inc. and the Seller](5) (including all exhibits thereto,
together with all letter agreements entered into that by their terms
constitute part of any such Purchase Agreement), as the same may be amended
or otherwise supplemented from time to time, as the same has been assigned
to Lessee, relating to the purchase by Lessee of the Aircraft.
"Purchase Agreement Assignment" means the Purchase Agreement
Assignment (US Airways, Inc. Trust No. N___U_), dated as of the date of
the Lease, between Lessee and Lessor, as the same may be amended,
supplemented or modified from time to time, with a form of Consent and
Agreement to be executed by the Seller attached thereto.
"Purchase Option Date" has the meaning specified for such term in
Section 19(b) of the Lease.
"Purchasers" means the Pass Through Trustees under each Pass
Through Trust Agreement.
"QIB" has the meaning specified for such term in Section 2.08 of
the Trust Indenture.
"Qualified Owner Participant" means a Person (x) that is not an
Affiliate of Lessee and (y) that has a tangible net worth, calculated in
accordance with generally accepted accounting principles, greater than
$50,000,000 or such other amount as is acceptable to Lessee, or (z) whose
obligations under the Operative Documents are unconditionally guaranteed by
a Person meeting the requirements of clauses (x) and (y).
"Refinancing Certificate" has the meaning specified for such term
in Section 16(a) of the Participation Agreement.
"Refinancing Date" has the meaning specified for such term in
Section 16(a) of the Participation Agreement.
"Refinancing Information" has the meaning specified for such term
in Section 16(a) of the Participation Agreement.
"Registration Agreement" means the Registration Agreement dated
August 31, 1999 by Lessee, and confirmed and accepted by AIFS, in respect
of the 7.96% Pass Through Certificates, Series 1999-1, Class C, as such
Registration Agreement may be amended, modified and supplemented from time
to time in accordance with the provisions thereof.
"Remaining Weighted Average Life" of an Equipment Note, at the
redemption date of such Equipment Note, means the number of days equal to
the quotient obtained by dividing (a) the sum of the products obtained by
----------------
(4) For A319 and A320 Aircraft transactions.
(5) For A330 Aircraft transactions
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.
"Renewal Term" means any Fixed Renewal Term or Fair Market
Renewal Term.
"Rent" means Basic Rent and Supplemental Rent, collectively.
"Replacement Airframe" means any airframe substituted for the
Airframe pursuant to Section 10 of the Lease.
"Replacement Engine" means any engine substituted for an Engine
pursuant to Sections 9(c) and 10 of the Lease.
"Responsible Officer" means with respect to the Owner Trustee, a
responsible officer in the Trust Office of the Owner Trustee (including,
without limitation, any authorized officer in the Trust Office of the Owner
Trustee), and with respect to the Indenture Trustee, a responsible officer
in the Corporate Trust Office of the Indenture Trustee.
"Scheduled Delivery Date" has the meaning specified for such term
in Section 2(f) of the Participation Agreement.
"Section 1110 Period" has the meaning specified for such term in
Section 4.04(a) of the Trust Indenture.
"Secured Obligations" has the meaning specified for such term in
the Granting Clause of the Trust Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" means AVSA, S.A.R.L., a societE a responsabilite limitee
organized and existing under the laws of the Republic of France.
"Senior Holder" has the meaning specified for such term in
Section 2.15(c) of the Trust Indenture.
"Series A" or "Series A Equipment Notes" means Equipment Notes
issued and designated as "Series A" under the Trust Indenture, in the
Principal Amount and maturities and bearing interest as specified in
Schedule I to the Trust Indenture under the heading "Series A."
"Series B" or "Series B Equipment Notes" means Equipment Notes
issued and designated as "Series B" under the Trust Indenture, in the
Principal Amount and maturities and bearing interest as specified in
Schedule I to the Trust Indenture under the heading "Series B."
"Series C" or "Series C Equipment Notes" means Equipment Notes
issued and designated as "Series C" under the Trust Indenture, in the
Principal Amount and maturities and bearing interest as specified in
Schedule I to the Trust Indenture under the heading "Series C."
"Significant Expenditure" means an expenditure or planned
expenditure of the type described in clause (B) of the definition of
Burdensome Termination Event.
"State Street" means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its capacity as Indenture Trustee under the Trust Indenture, but in its
individual capacity.
"Sublease" means any sublease permitted by the terms of Section
7(b)(x) of the Lease.
"Sublessee" means any Person for so long, but only so long, as
such Person is in possession of the Airframe and/or any Engine pursuant to
the terms of a Sublease which is then in effect pursuant to Section 7(b)(x)
of the Lease.
"Subordination Agent" means State Street Bank and Trust Company
of Connecticut, National Association, a national banking association, as
subordination agent under the Intercreditor Agreement, or any successor
thereto.
"Subsequent Owner Participant" means any entity to which the
Owner Participant or any transferee from the Owner Participant or any
Subsequent Owner Participant shall have transferred at any time after the
Delivery Date all of the undivided right, title and interest originally
held by the Owner Participant in the Trust Agreement, the Trust Estate and
the Participation Agreement, to the extent permitted by Section 8.01 of the
Trust Agreement and Section 7(k) of the Participation Agreement.
"Supplemental Rent" means, without duplication, (a) all amounts,
liabilities, indemnities and obligations (other than Basic Rent) that
Lessee assumes or becomes obligated to or agrees to pay under any Lessee
Document to or on behalf of Lessor or any other Person, including, without
limitation, payments of Termination Value, any amounts in respect of a
purchase price payable pursuant to Section 19(c) or 20 of the Lease and
payments of indemnities under Section 6 of the Participation Agreement, but
excluding any amount as to which Lessee is obligated to pay a pro rata
share pursuant to clause (d) or (e) of this definition, (b) (i) to the
extent not payable (whether or not in fact paid) under Section 7(a) of the
Note Purchase Agreement (as originally in effect or amended with the
consent of the Owner Participant), an amount or amounts equal to the fees
payable to the Liquidity Provider under Section 2.03 of each Liquidity
Facility and the related Fee Letter (as defined in the Intercreditor
Agreement) multiplied by a fraction the numerator of which shall be the
then outstanding aggregate principal amount of the Series A Equipment
Notes, Series B Equipment Notes and Series C Equipment Notes and the
denominator of which shall be the then outstanding aggregate principal
amount of all "Series A Equipment Notes", "Series B Equipment Notes" and
"Series C Equipment Notes" (in each case as defined in the relevant
Operative Indenture) issued under the Operative Indentures; (ii) (x) the
amount equal to interest on any Downgrade Advance (other than any Applied
Downgrade Advance) payable under Section 3.07 of each Liquidity Facility
minus Investment Earnings from such Downgrade Advance multiplied by (y)
the fraction specified in the foregoing clause (i); (iii) (x) the amount
equal to interest on any Non-Extension Advance (other than any Applied Non-
Extension Advance) payable under Section 3.07 of each Liquidity Facility
minus Investment Earnings from such Non-Extension Advance multiplied by (y)
the fraction specified in the foregoing clause (i); (iv) if any payment
default shall have occurred and be continuing with respect to interest on
any Series A Equipment Note, Series B Equipment Note or Series C Equipment
Note, (x) the excess, if any, of (1) an amount equal to interest on any
Unpaid Advance, Applied Downgrade Advance or Applied Non-Extension Advance
payable under Section 3.07 of each Liquidity Facility over (2) the sum of
Investment Earnings from any Final Advance plus any amount of interest at
the Past Due Rate actually payable (whether or not in fact paid) by Lessee
in respect of the overdue scheduled interest on the Equipment Notes in
respect of which such Unpaid Advance, Applied Downgrade Advance or Applied
Non-Extension Advance was made multiplied by (y) a fraction the numerator
of which shall be the then aggregate overdue amounts of interest on the
Series A Equipment Notes, Series B Equipment Notes and Series C Equipment
Notes (other than interest becoming due and payable solely as a result of
acceleration of any such Equipment Notes) and the denominator of which
shall be the then aggregate overdue amounts of interest on all "Series A
Equipment Notes", "Series B Equipment Notes" and "Series C Equipment
Notes" (in each case as defined in the relevant Operative Indenture) issued
under the Operative Indentures (other than interest becoming due and
payable solely as a result of acceleration of any such "Equipment Notes,"
(in each case as defined in the relevant Operative Indenture) issued under
the Operative Indentures); and (v) Lessee's pro rata share of any other
amounts owed to the Liquidity Provider by the Subordination Agent as
borrower under each Liquidity Facility (other than amounts due as
repayment of advances thereunder or as interest on such advances), except
to the extent payable pursuant to clause (i), (ii), (iii) or (iv) above,
(c) Lessee's pro rata share of all compensation and reimbursement of
expenses, disbursements and advances payable by Lessee under the Pass
Through Trust Agreements, (d) Lessee's pro rata share of all compensation
and reimbursement of expenses and disbursements payable to the
Subordination Agent under the Intercreditor Agreement except with respect
to any income or franchise taxes incurred by the Subordination Agent in
connection with the transactions contemplated by the Intercreditor
Agreement and (e) Lessee's pro rata share of any amount payable under
Section 6(c) of the Participation Agreement to any Pass Through Indemnitee
to the extent such amount relates to, results from or arises out of or in
connection with (i) the Pass Through Trust Agreement or the enforcement of
any of the terms of any Pass Through Document, (ii) the offer, sale, or
delivery of the Pass Through Certificates or any interest therein or
represented thereby or (iii) any breach of or failure to perform or
observe, or any other noncompliance with, any covenant or agreement or
other obligation to be performed by Lessee under any Pass Through Document
or the falsity of any representation or warranty of Lessee in any Pass
Through Document. As used herein, "Lessee's pro rata share" means as of
any time a fraction, the numerator of which is the principal balance then
outstanding of Equipment Notes and the denominator of which is the
aggregate principal balance then outstanding of all "Equipment Notes" (in
each case as defined in the relevant Operative Indenture) issued under the
Operative Indentures. For purposes of this definition, the terms "Applied
Downgrade Advance", "Applied Non-Extension Advance", "Cash Collateral
Account", "Downgrade Advance", "Final Advance", "Investment Earnings",
"Non-Extension Advance" and "Unpaid Advance" shall have the meanings
specified in each Liquidity Facility. For the avoidance of doubt, it is
understood and agreed that Supplemental Rent includes, without limitation,
any amounts payable under the third paragraph of Section 2.02 of the Trust
Indenture.
"Tax Indemnitee" means (i) the Owner Participant, the Owner
Trustee, in its individual capacity and as trustee under the Trust
Agreement, the Trust Estate, the Indenture Trustee, (ii) the respective
Affiliates, successors and permitted assigns of each of the entities
described in the preceding clause (i), and (iii) the Trust Indenture
Estate.
"Tax Indemnity Agreement" means that certain Tax Indemnity
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the date of the
Lease, between the Owner Participant and Lessee, as originally executed or
as modified, amended or supplemented pursuant to the applicable provisions
thereof.
"Taxes" means any and all fees (including, without limitation,
license, recording, documentation and registration fees), taxes (including,
without limitation, income, gross receipts, sales, rental, use, turnover,
value added, property (tangible and intangible), excise and stamp taxes),
license, levies, imposts, duties, recording charges and assessments of any
kind whatsoever that are in the nature of taxes or other governmental
charges including interest, penalties and additions to tax (each,
individually a "Tax").
"Term" means the Basic Term and, if actually entered into, any
Renewal Term.
"Termination Date" has the meaning set forth in Section 9(a) of
the Lease.
"Termination Value" with respect to the Aircraft as of any date
during the Term means, but subject always to the provisions of Section
3(c)(v) of the Lease, the amount determined by multiplying Lessor's Cost
for the Aircraft by the percentage specified in Exhibit C to the Lease
opposite the Termination Date with respect to which the amount is
determined (as such Exhibit C may be adjusted from time to time as provided
in Section 3(c) of the Lease and as expressly provided in any other
Operative Document).
"Transaction Expenses" means: all of the reasonable out-of-pocket
costs, fees and expenses incurred by Lessee, the Owner Trustee, the Pass
Through Trustee, the Subordination Agent and the Indenture Trustee in
connection with the transactions contemplated by the Participation
Agreement, the other Operative Documents, the Pass Through Trust
Agreements, the Pass Through Documents, the Intercreditor Agreement, the
Liquidity Facilities and the Underwriting Agreement (except, in each case,
as otherwise provided therein) including, without limitation:
(a) the reasonable and actual fees, expenses and
disbursements of (A) Bingham Dana LLP, special counsel for the Pass Through
Trustee, the Subordination Agent and the Indenture Trustee, (B) Ray,
Quinney & Nebeker, special counsel for the Owner Trustee, (C) Milbank,
Tweed, Hadley & McCloy LLP, special counsel for the Underwriters, and (D)
Crowe & Dunlevy, P.C., special counsel in Oklahoma City, Oklahoma and (E)
Simpson Thacher & Bartlett, special counsel to AIFS;
(b) the initial fees and reasonable and actual disbursements
of the Owner Trustee under the Trust Agreement;
(c) the initial fee and reasonable and actual disbursements
of the Indenture Trustee under the Trust Indenture;
(d) the initial fees and expenses of the Liquidity Provider,
the Pass Through Trustee and the Subordination Agent;
(e) underwriting fees and commissions;
(f) the fees and expenses with respect to the appraisal of
the Aircraft;
(g) the reasonable fees, expenses and disbursements of
_________________, special counsel to the Owner Participant, such fees not
to exceed the amount previously agreed to by the Owner Participant and
Lessee;
(h) the fees, expenses and disbursements of Skadden, Arps,
Slate, Meagher & Flom LLP and its affiliates, special counsel for Lessee;
(i) the costs of filing and recording documents with the FAA
and filing Uniform Commercial Code statements in the United States;
(j) the reasonable fees, expenses and disbursements of
special counsel to the Liquidity Provider;
(k) the expenses of the Depositary payable under Section
10(a) of each Indemnity Agreement; and
(l) the reasonable fees, expenses and disbursements of
special counsel to the Seller and the Manufacturer.
"Transactions" means the transactions contemplated by the
Participation Agreement and the other Operative Documents.
"Transferee" has the meaning specified for such term in Section
7(k) of the Participation Agreement.
"Transportation Code" means that portion of the United States Code
comprising those provisions formerly referred to as the Federal Aviation
Act of 1958, as amended, or any subsequent legislation that amends,
supplements or supersedes such provisions.
"Trust Agreement" means that certain Trust Agreement (US Airways,
Inc. Trust No. N___U_), dated as of the date of the Lease, between the
Owner Participant and First Security Bank, National Association, in its
individual capacity, as originally executed or as modified, amended or
supplemented pursuant to the applicable provisions thereof, including,
without limitation, supplementation thereof by one or more Trust
Supplements entered into pursuant to the applicable provisions thereof.
"Trust Agreement and Indenture Supplement" or "Trust Supplement"
means a supplement to the Trust Agreement and the Trust Indenture,
substantially in the form of Exhibit A to the Trust Indenture, which shall
particularly describe the Aircraft, and any Replacement Airframe and
Replacement Engine included in the property of the Owner Trustee covered by
the Trust Agreement.
"Trust Estate" means all estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Purchase Agreement, the Purchase Agreement Assignment, the Bill of Sale and
the FAA Bill of Sale, including, without limitation, all amounts of Basic
Rent and Supplemental Rent including without limitation insurance proceeds
(other than insurance proceeds payable to or for the benefit of the Owner
Trustee, for its own account or in its individual capacity, the Owner
Participant, the Loan Participants or the Indenture Trustee) and
requisition, indemnity or other payments of any kind for or with respect to
the Aircraft (except amounts owing to the Owner Participant, to the
Indenture Trustee, to the Owner Trustee, in its individual capacity, or to
the Loan Participants or any other holder of a Equipment Note, or to any of
their respective directors, officers, employees, servants and agents,
pursuant to Section 6 of the Participation Agreement). Notwithstanding the
foregoing, "Trust Estate" shall not include any Excluded Payments.
"Trust Indenture" means that certain Trust Indenture and Security
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the date of the
Lease, between Lessor and the Indenture Trustee, as it may from time to
time be supplemented or amended as therein provided, including
supplementing by the Trust Agreement and Indenture Supplement pursuant to
the Trust Indenture.
"Trust Indenture Estate" means all estate, right, title and
interest of the Indenture Trustee in and to the properties referred to in
the Granting Clause of the Trust Indenture, excluding Excluded Payments.
"Underwriters" means Credit Suisse First Boston Corporation,
Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities Corporation,
Deutsche Bank Securities Inc. and Salomon Smith Barney Inc.
"U.S. Air Carrier" means any Certificated Air Carrier as to which
there is in force an air carrier operating certificate issued pursuant to
Part 121 of the regulations under the Transportation Code, or which may
operate as an air carrier by certification or otherwise under any successor
or substitute provisions therefor or in the absence thereof.
"U.S. Person" means any Person that qualifies as a "United States
person" under Section 7701(a)(30) of the Code.
"Wet Lease" means any arrangement whereby the Lessee (or any
Sublessee) agrees to furnish the Airframe and Engines or engines installed
thereon to a third party pursuant to which such Airframe and Engines or
engines (i) shall be operated solely by regular employees of Lessee (or any
Sublessee) possessing all current certificates and licenses that would be
required under the Transportation Code, or, if the Aircraft is not
registered in the United States, all certificates and licenses required by
the laws of the jurisdiction of registry, for the performance by such
employees of similar functions within the United States of America or such
other jurisdiction of registry (it is understood that cabin attendants need
not be regular employees of Lessee (or any Sublessee)) and (ii) shall be
maintained by Lessee (or any Sublessee) in accordance with its normal
maintenance practices.
Form Definitions
N___U__
ANNEX A
[FORM OF DEFINITIONS DEFERRED EQUITY/
PREPAID DEFERRED RENT STRUCTURE]
DEFINITIONS
(US Airways, Inc. Trust No. N___U_)
The following terms shall have the following meanings for all
purposes of the Operative Documents referred to below, unless otherwise
defined in an Operative Document or the context thereof shall otherwise
require and such meanings shall be equally applicable to both the singular
and the plural forms of the terms herein defined. In the case of any
conflict between the provisions of this Annex A and the provisions of the
main body of any Operative Document, the provisions of the main body of
such Operative Document shall control the construction of such Operative
Document.
Except as otherwise provided herein, all references to any
agreement defined in this Annex A shall be deemed to include such agreement
as the same may from time to time be amended, supplemented or otherwise
modified in accordance with its terms and, where applicable, the terms of
the other Operative Documents. All references to statutes, rules and
regulations shall be deemed to include all amendments, replacements and
successors thereto unless otherwise specified herein.
["Acceptable Alternate Engine" means (i) a CFM International
Model 56-5 (or improved) type engine having not less than 1,500 cycles left
before such engine's next scheduled maintenance overhaul or (ii) an engine
of the same or another manufacturer suitable for use on the Airframe and
having a value and utility equal to or greater than a CFM Model 56-5 type
engine, assuming such engine is in the condition required by the Lease.] (1)
______________________
(1) For A319 and A320 Aircraft; Definition for A330
Aircraft to be determined.
"Acceptance Certificate" has the meaning specified for such term
in Section 4(a)(v) of the Participation Agreement.
"Actual Knowledge" means, (i) as it applies to the Owner Trustee
or Indenture Trustee, as the case may be, actual knowledge of a Responsible
Officer in the Trust Office of the Owner Trustee or in the Corporate Trust
Office of the Indenture Trustee, as the case may be, and (ii) as it applies
to the Owner Participant, actual knowledge of a vice president or other
higher officer of the Owner Participant having responsibility for the
transactions contemplated by the Operative Documents.
"Additional Insured" means Lessor, in its individual capacity and
as owner of the Aircraft, the Indenture Trustee, the Owner Participant, the
Pass Through Trustee, the Liquidity Provider, Lessee in its capacity as
sublessor under any Sublease, and each of their respective Affiliates,
successors and permitted assigns, and the respective directors, officers,
employees and agents of the foregoing.
"Additional Parts" has the meaning specified for such term in
Section 8(c) of the Lease.
"Advance" has the meaning specified for such term in Section 3(g)
of the Lease.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control
with such Person. For the purposes of this definition, "control"
(including "controlled by" and "under common control with") shall mean the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether through the ownership of
voting securities or by contract or otherwise.
"AIFS" means Airbus Industrie Financial Services, a corporation
formed under the laws of Ireland.
"Aircraft" means the Airframe to be delivered and leased under
the Lease (or any airframe from time to time substituted for such Airframe
pursuant to Section 10(a) of the Lease) together with the two Engines
initially leased under the Lease (or any engine substituted for either of
such Engines pursuant to the terms of the Lease), in each case as specified
in the applicable Lease Supplement, whether or not any of such initial or
substituted Engines may from time to time be installed on such initial or
substituted Airframe or may be installed on any other airframe or on any
other aircraft.
"Airframe" means: (i) the Airbus aircraft (except Engines or
engines from time to time installed thereon) specified in the initial Lease
Supplement, which aircraft shall be leased by Lessor to Lessee under the
Lease and under such Lease Supplement, and any aircraft (except Engines or
engines from time to time installed thereon) which may from time to time be
substituted for such aircraft (except Engines or engines from time to time
installed thereon) pursuant to clause (ii) of the first paragraph of
Section 10(a) of the Lease; and (ii) any and all Parts (A) so long as the
same shall be incorporated or installed in or attached to such aircraft
(except Engines or engines from time to time installed thereon), or (B) so
long as title thereto shall remain vested in Lessor in accordance with the
terms of Section 8 of the Lease after removal from such aircraft (except
Engines or engines from time to time installed thereon); provided, however,
that at such time as an aircraft (except Engines or engines from time to
time installed thereon) shall be deemed part of the property leased under
the Lease in substitution for the Airframe pursuant to the applicable
provisions of the Lease, the replaced Airframe shall cease to be an
Airframe under the Lease; provided further that the Airframe shall not
include Passenger Convenience Equipment.
"Amortization Amount" means, with respect to any Principal Amount
Repayment Date, the amount set forth opposite such Date as the Principal
Amount to be repaid on the Amortization Schedule.
"Amortization Schedule" means the amortization schedule for the
Equipment Notes delivered pursuant to Section 2.02 of the Trust Indenture.
"Applicable Rate" means as of any date the weighted average of
the interest rates borne by the Equipment Notes then outstanding and, if no
Equipment Notes shall be outstanding, the Base Rate.
"Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as
amended, or any subsequent legislation that amends, supplements or
supersedes such provisions.
"Base Rate" means the rate of interest announced publicly by The
Chase Manhattan Bank from time to time as its base rate.
"Basic Rent" means, for the Basic Term, the rent payable for the
Aircraft pursuant to Section 3(b) of the Lease as adjusted as provided in
Section 3(c) of the Lease but subject always to the provisions of Section
3(c)(v) of the Lease and, for any Renewal Term, Basic Rent determined
pursuant to Section 19 of the Lease.
"Basic Term" means the term for which the Aircraft is leased
pursuant to Section 3(a) of the Lease, commencing on the Delivery Date and
ending on the Basic Term Expiration Date.
"Basic Term Expiration Date" means ____________________________,
or such earlier date as the Lease may be terminated in accordance with the
provisions thereof.
"Bill of Sale" means a full warranty bill of sale covering the
Aircraft, executed by Lessee in favor of the Owner Trustee, dated the
Delivery Date, specifically referring to the Airframe and each Engine,
which Bill of Sale shall contain, among other things, a statement that such
Bill of Sale thereby conveys to the Owner Trustee good title to the
Airframe and each Engine described in such Bill of Sale, free and clear of
all liens, encumbrances and rights of others except Permitted Liens
described in Section 6(a)(xv) of the Participation Agreement.
"Burdensome Termination Event" means an event which shall be
deemed to have occurred if (A) one or more events have occurred which give
rise to an obligation on the part of Lessee to pay or indemnify any costs
or expenses under Sections 6(b) or 6(c) of the Participation Agreement or
under the Tax Indemnity Agreement if the aggregate amount of such indemnity
or other payments would exceed (as to future payments on a present value
basis discounted at the Debt Rate) 2.50% of Lessor's Cost or (B) Lessee
plans non-severable improvements to the Aircraft which (i) are necessary or
desirable in Lessee's sole discretion, (ii) are expected to cost in excess
of $2.5 million and (iii) the Owner Participant will not permit to be
financed under similar terms then available in the market for similar
transaction.
"Business Day" means any day other than a Saturday or Sunday or a
day on which commercial banks are required or authorized to close in the
City of New York, New York, Hartford, Connecticut, Pittsburgh,
Pennsylvania or the city and state where the office of the Owner Trustee is
located.
"Cash Equivalents" means (i) direct obligations of the United
States of America and agencies guaranteed by the United States government
having a final maturity of ninety (90) days or less from date of purchase
thereof; (ii) certificates of deposit issued by, bankers' acceptances of,
or time deposits with, any bank, trust company or national banking
association incorporated under the laws of the United States of America or
one of the states thereof having combined capital and surplus and retained
earnings as of its last report of condition of at least $500,000,000 and
having a rating of Aa or better by Moody's Investors Service, Inc.
("Moody's") or AA or better by Standard & Poor's Corporation ("S&P") and
having a final maturity of ninety (90) days or less from date of purchase
thereof; and (iii) commercial paper of any holding company of a bank, trust
company or national banking association described in (ii) and commercial
paper of any corporation or finance company incorporated or doing business
under the laws of the United States of America or any state thereof having
a rating assigned to such commercial paper of A1 by S&P or P1 by Moody's
and having a final maturity of ninety (90) days or less from the date of
purchase thereof; provided, however, that the aggregate amount at any one
time so invested in certificates of deposit issued by any one bank shall
not be in excess of 5% of such bank's capital and surplus.
"Certificated Air Carrier" means a Citizen of the United States
holding a carrier operating certificate issued by the Secretary of
Transportation pursuant to Chapter 447 of Title 49, United States Code, for
aircraft capable of carrying ten or more individuals or 6,000 pounds or
more of cargo or that otherwise is certified or registered to the extent
required to fall within the purview of 11 U.S.C. Section 1110 or any
analogous successor provision of the Bankruptcy Code.
"Citizen of the United States" has the meaning specified for such
term in Section 40102(a)(15) of Title 49 of the United States Code or any
similar legislation of the United States of America enacted in substitution
or replacement therefor.
"Civil Reserve Air Fleet Program" means the Civil Reserve Air
Fleet Program currently administered by the United States Air Force Air
Mobility Command pursuant to Executive Order No. 11490, as amended, or any
substantially similar program.
"Class A Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class B Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class C Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class C Purchase Agreement" means that certain Purchase
Agreement, dated as of August 31, 1999, by and between Lessee and AIFS.
"Class C Special Indemnity Event" means the existence of any
condition or event which, pursuant to Section 3 of the Registration
Agreement, requires US Airways, Inc. to pay liquidated damages to the US
Airways Pass Through Trust 1999-1C in accordance with such Section 3,
subject to the last sentence of the first paragraph of Section 3 of the
Registration Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commitment" means the commitment pursuant to the Participation
Agreement of a Pass Through Trustee or of the Owner Participant, as the
case may be, to finance the Owner Trustee's payment of Lessor's Cost for
the Aircraft.
"Consent and Agreement" means, collectively, each Consent and
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the date of the
Lease, executed by the Seller and the Manufacturer, respectively, as the
same may be amended, modified or supplemented from time to time in
accordance with the applicable provisions thereof.
"Continuous Stay Period" has the meaning specified for such term
in Section 4.04(a) of the Trust Indenture.
"Corporate Trust Office" means the principal office of the
Indenture Trustee located at 225 Asylum Street, Goodwin Square, Hartford,
Connecticut 06103, Attention: Corporate Trust Administration, or such
other office at which the Indenture Trustee's corporate trust business
shall be administered which the Indenture Trustee shall have specified by
notice in writing to Lessee, the Owner Trustee, the Loan Participants and
each Note Holder.
"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 or for the deferred purchase
price of property, goods or services.
"Debt Rate" means, with respect to any Series, the rate per annum
specified for such Series under the heading "Interest Rate" in Schedule I
to the Trust Indenture.
"Default" means any event or condition that with the giving of
notice or the lapse of time or both would become an Event of Default or
Lease Event of Default (excluding Lease Events of Default related to
Excluded Payments).
["Deferred Equity Amounts" has the meaning set forth in Schedule
IV of the Participation Agreement.] (2)
["Deferred Equity Dates" has the meaning set forth in Schedule IV
of the Participation Agreement.] (3)
____________________
(2) For deferred equity deals only.
(3) For deferred equity deals only.
"Delivery Date" means the date of the initial Lease Supplement
for the Aircraft, which date shall be the date the Aircraft is leased by
Lessor to Lessee and accepted by Lessee under the Lease.
"Delivery Notice" means the notice of delivery delivered pursuant
to Section 2(c) of the Participation Agreement.
"Depositary" means ABN AMRO Bank, N.V., acting through its
Chicago branch, as Class A Depositary, Class B Depositary and Class C
Depositary under the Deposit Agreements, or any successor thereto.
"Deposit Agreements" means, collectively, (i) that certain
Deposit Agreement (Class A), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary, (ii) that certain
Deposit Agreement (Class B), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary and (iii) that certain
Deposit Agreement (Class C), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary.
"Depreciation Period" means the period commencing on the Delivery
Date and ending at the end of the calendar year during which the seventh
(7th) anniversary of the Delivery Date occurs, or such earlier date as the
Lease may be terminated in accordance with the provisions of the Lease.
"Determination Date" has the meaning set forth in Section
10(a)(i) of the Lease.
"Dollars" and "$" mean the lawful currency of the United States
of America.
"EBO Amount" means the applicable amount for the relevant EBO
Date set forth on Exhibit D to the Lease (as such Exhibit D may be adjusted
from time to time as provided in Section 3(c) of the Lease or as expressly
provided in any Operative Document).
"EBO Date" means the applicable date set forth on Exhibit D to
the Lease.
"Enforcement Date" has the meaning specified for such term in
Section 4.03 of the Trust Indenture.
"Engine" means (i) each of the two [CFM International 56-5] (4)
[Pratt & Whitney] (5) type engines listed by manufacturer's serial number in
the initial Lease Supplement, whether or not from time to time thereafter
installed on the Airframe or installed on any other airframe or on any
other aircraft; and (ii) any Acceptable Alternate Engine that may from time
to time be substituted, pursuant to the terms of the Lease, for either of
such two engines, together in each case with any and all Parts incorporated
or installed in or attached thereto or any and all Parts removed therefrom
so long as title thereto shall remain vested in Lessor in accordance with
the terms of Section 8 of the Lease after removal from such Engine;
provided, however, that at such time as an engine shall be deemed part of
the property leased under the Lease in substitution for an Engine pursuant
to the applicable provisions of the Lease, the replaced Engine shall cease
to be an Engine under the Lease. The term "Engines" means, as of any date
of determination, all Engines then leased under the Lease.
____________________
(4) For A319 and A320 Aircraft
(5) For A330 Aircraft
"Equipment Note Register" has the meaning specified for such term
in Section 2.07 of the Indenture.
"Equipment Note Registrar" has the meaning specified for such
term in Section 2.07 of the Indenture.
"Equipment Notes" means and include any Equipment Notes issued
under the Trust Indenture, and issued in exchange therefor or replacement
thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of the Participation Agreement and any subsequent
provisions of ERISA, amendatory thereof, supplemental thereto or
substituted therefor.
"Escrow Agreements" means, collectively, (i) that certain Escrow
and Paying Agent Agreement (Class A), dated as of August 31, 1999, among
First Security Bank, National Association, as escrow agent, the
Underwriters, the Pass Through Trustee, and State Street Bank and Trust
Company of Connecticut, National Association, as paying agent thereunder,
(ii) that certain Escrow and Paying Agent Agreement (Class B), dated as of
August 31, 1999, among First Security Bank, National Association, as escrow
agent, the Underwriters, the Pass Through Trustee, and State Street Bank
and Trust Company of Connecticut, National Association, as paying agent
thereunder and (iii) that certain Escrow and Paying Agent Agreement (Class
C), dated as of August 31, 1999, among First Security Bank, National
Association, as escrow agent, the Underwriters, the Pass Through Trustee,
and State Street Bank and Trust Company of Connecticut, National
Association, as paying agent thereunder.
"Event of Default" (i) when such term is used in or with respect
to the Lease has the meaning specified for such term in Section 14 of the
Lease and (ii) when such term is used in or with respect to the Trust
Indenture has the meaning specified for such term in Section 4.02 of the
Trust Indenture.
"Event of Loss" means, with respect to the Aircraft, Airframe or
any Engine, any of the following events with respect to such property: (i)
the loss of such property or of the use thereof due to the destruction of
or damage to such property which renders repair uneconomic or which renders
such property permanently unfit for normal use by Lessee (or any Sublessee)
for any reason whatsoever; (ii) any damage to such property which results
in an insurance settlement with respect to such property on the basis of a
total loss, or a constructive or compromised total loss; (iii) the theft or
disappearance of such property for a period in excess of one hundred eighty
(180) days or, if earlier, the expiration of the Term; (iv) the requisition
for use of such property by any governmental authority (other than a
requisition for use by the United States Government or any government of
registry of the Aircraft or any agency or instrumentality thereof) that
shall have resulted in the loss of possession of such property by Lessee
(or any Sublessee) for a period in excess of one hundred eighty (180)
consecutive days or, if earlier, the expiration of the Term; (v) the
requisition for use by the United States Government or any government of
registry of the Aircraft or any instrumentality or agency thereof, which
shall have occurred during the Basic Term (or any Renewal Term) and shall
have continued for a period of thirty (30) days beyond the Term, provided,
however, that no Event of Loss pursuant to this clause (v) shall exist if
Lessor shall have furnished to Lessee the written notice specified in
Section 10(d) of the Lease; (vi) condemnation, confiscation, requisition or
taking of title of the Aircraft or the Airframe for more than thirty (30)
days, or if earlier, the expiration of the Term; (vii) as a result of any
law, rule, regulation, order or other action by the Federal Aviation
Administration or other governmental body of the government of registry of
the Aircraft having jurisdiction, the use of such property in the normal
course of the business of air transportation shall have been prohibited for
a period of one hundred eighty (180) consecutive days, unless Lessee (or
Sublessee) shall have undertaken and shall be diligently carrying forward
all steps which are necessary or desirable to permit the normal use of such
property by Lessee (or such Sublessee), but in any event an "Event of Loss"
shall occur if such "grounding" extends for a period of more than three
hundred sixty (360) days (or, if earlier, the expiration of the Term);
provided that no Event of Loss shall be deemed to occur if such "grounding"
is applicable to Lessee's entire fleet of [A319][A320][A330] aircraft and
Lessee, prior to the expiration of one year from the prohibition of such
use, shall have conformed at least one such aircraft in its fleet to the
requirements of any such law, rule, regulation, order or other action and
commenced regular commercial use of the same in such jurisdiction and shall
be diligently carrying forward, on a non-discriminatory basis, all steps
which are necessary or desirable to permit the normal use of the Aircraft
by Lessee (or such Sublessee), but in any event an "Event of Loss" shall be
deemed to have occurred if such use shall have been prohibited for a period
of two consecutive years or such use shall be prohibited at the expiration
of the Term; and (viii) with respect to an Engine only, any divestiture of
title to or interest in an Engine or any event with respect to an Engine
that is deemed to be an Event of Loss with respect to such Engine pursuant
to Section 7(b) of the Lease. An Event of Loss with respect to the
Aircraft shall be deemed to have occurred if an Event of Loss occurs with
respect to the Airframe.
"Excluded Payments" means (i) indemnity payments paid or payable
by Lessee to or in respect of the Owner Participant or the Owner Trustee in
its individual capacity, their respective Affiliates, successors and
permitted assigns and their directors, officers, employees, servants and
agents (collectively, the "Owner Indemnitees") pursuant to Sections 6(b),
6(c), 15 or 16 of the Participation Agreement, (ii) proceeds of public
liability insurance in respect of the Aircraft payable as a result of
insurance claims made, or losses suffered, by the Owner Trustee or the
Indenture Trustee in their respective individual capacities or by any of
the Owner Indemnitees, (iii) proceeds of insurance maintained with respect
to the Aircraft by the Owner Participant (whether directly or through the
Owner Trustee) or any other Owner Indemnitee and permitted under Section 11
of the Lease in Exhibit H thereto, (iv) all payments required to be made
under the Tax Indemnity Agreement by Lessee and all payments of
Supplemental Rent by Lessee in respect of any amounts payable under the Tax
Indemnity Agreement, (v) fees payable to the Owner Trustee or the Indenture
Trustee, (vi) provided that the Equipment Notes shall have been duly
assumed by Lessee pursuant to Section 2.13 of the Trust Indenture, the
amounts payable to the Owner Trustee pursuant to Section 19(b) of the Lease
plus all reasonable expenses incurred by the Owner Trustee and the Owner
Participant in connection with such assumption, as applicable, (vii)
interest accrued on any of the above, and (viii) any right to enforce the
payment of any amount described in clauses (i) through (vii) above
(provided the rights referred to in this clause (viii) shall not be deemed
to include the exercise of any remedies provided for in the Lease other
than the right to sue for specific performance of any covenant or to make
such payment or to sue for damages in respect of the breach of any such
covenant) and the right to declare an Event of Default in respect of any of
the foregoing amounts. Solely for purposes of the Granting Clause of the
Trust Indenture, amounts payable to AIFS under Section 6(d) of the
Participation Agreement shall be considered Excluded Payments.
"Expenses" means all liabilities, obligations, losses, damages,
settlements, penalties, claims, actions, suits, costs, expenses and
disbursements (including, without limitation, reasonable fees and
disbursements of legal counsel, accountants, appraisers, inspectors or
other professionals and reasonable costs of investigation).
"Fair Market Renewal Term" has the meaning specified for such
term in Section 19(a)(2) of the Lease.
"FAA Bill of Sale" means a bill of sale for the Aircraft on AC
Form 8050-2 or such other form as may be approved by the Federal Aviation
Administration on the Delivery Date for the Aircraft, executed by Lessee in
favor of the Owner Trustee and dated the Delivery Date.
"Federal Aviation Administration" and "FAA" mean the United
States Federal Aviation Administration and any agency or instrumentality of
the United States government succeeding to their functions.
"Federal Funds Rate" means a fluctuating interest rate per annum
in effect from time to time, which rate per annum shall at all times be
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by State Street from three Federal funds brokers of
recognized standing selected by it.
"Fixed Renewal Term" has the meaning specified for such term in
Section 19(a)(1) of the Lease.
"Foreign Air Carrier" means any air carrier which is not a U.S.
Air Carrier and which performs, or contracts for the performance of,
maintenance, preventative maintenance and inspections for the Aircraft,
Airframe and/or any Engine or engine to standards which are approved by, or
which are substantially equivalent to those required by, the Federal
Aviation Administration or any Permitted Foreign Air Authority.
"French Pledge Agreement" means the French Pledge Agreement (US
Airways, Inc. Trust No. N___U_), dated as of the date of the Lease,
between the Owner Trustee and the Indenture Trustee, as the same may be
amended, supplemented or modified from time to time.
"Government Entity" means (a) any federal, state, provincial or
similar government, and any body, board, department, commission, court,
tribunal, authority, agency or other instrumentality of any such government
or otherwise exercising any executive, legislative, judicial,
administrative or regulatory functions of such government or (b) any other
government entity having jurisdiction over any matter contemplated by the
Operative Documents or relating to the observance or performance of the
obligations of any of the parties to the Operative Documents.
"Indemnitee" means (i) the Owner Trustee, in its individual
capacity and as trustee under the Trust Agreement, (ii) the Indenture
Trustee, (iii) the Owner Participant, (iv) the Trust Estate, (v) the Loan
Participants and each other Note Holder, (vi) the Subordination Agent,
(vii) the Liquidity Provider, (viii) the Pass Through Trustees, (ix) each
Affiliate of the Persons described in clauses (i) through (iv), inclusive,
(x) each Affiliate of the Persons described in clauses (vi), (vii) and
(viii), (xi) the respective directors, officers, employees, agents and
servants of each of the Persons described in clauses (i) through (viii),
inclusive, (xii) the successors and permitted assigns of the Persons
described in clauses (i) through (iv), inclusive, and (xiii) the successors
and permitted assigns of the Persons described in clauses (v), (vi), (vii)
and (viii).
"Indemnity Agreement" means that certain Indemnity Agreement,
dated as of August 31, 1999, between the Depositary and Lessee.
"Indenture Agreements" means the Participation Agreement, the
Lease, the Purchase Agreement, the Purchase Agreement Assignment, the
Consent and Agreement, the Bills of Sale and any other contract, agreement
or instrument from time to time assigned or pledged under the Trust
Indenture.
"Indenture Event of Default" has the meaning given the term
"Event of Default" in the Trust Indenture.
"Indenture Excess Amount" has the meaning specified for such term
in Section 2.03(b) of the Trust Indenture.
"Indenture Indemnitees" means (i) State Street and the Indenture
Trustee, (ii) each separate or additional trustee appointed pursuant to the
Trust Indenture, (iii) the Subordination Agent, (iv) the Liquidity
Provider, (v) each Pass Through Trustee, and (vi) each of the respective
directors, officers, employees, agents and servants of each of the Persons
described in clauses (i) through (v), inclusive.
"Indenture Trustee" means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its individual capacity, but solely as Indenture Trustee, and any entity
which may from time to time be acting as indenture trustee under the Trust
Indenture.
"Indenture Trustee Documents" means the Participation Agreement,
the Trust Indenture and the French Pledge Agreement and any other
agreements between the Indenture Trustee and any other party to the
Participation Agreement relating to the Transactions, delivered on the
Delivery Date.
"Indenture Trustee Event" means either (i) the Equipment Notes
shall have become due and payable pursuant to Section 4.04(b) of the Trust
Indenture, (ii) the Indenture Trustee has taken action or notified Owner
Trustee that it intends to take action to foreclose the Lien of the Trust
Indenture or otherwise commence the exercise of any significant remedy
under the Trust Indenture or the Lease or (iii) in the event of a
reorganization proceeding involving Lessee under Chapter 11 of the
Bankruptcy Code, (A) the trustee in such proceeding or Lessee not assuming
or agreeing to perform its obligations under the Lease, as contemplated
under Section 1110, during the 60-day period under Section 1110(a)(1)(A) of
the Bankruptcy Code (or such longer period as may apply under Section
1110(b) of the Bankruptcy Code) or (B) at any time after agreeing to
perform or assuming such obligations, such trustee or Lessee ceasing to
perform such obligations with the result that the Continuous Stay Period
comes to an end.
"Indenture Trustee's Liens" means any Lien which arises as a
result of (A) claims against the Indenture Trustee not related to its
interest in the Aircraft or the administration of the Trust Estate pursuant
to the Trust Indenture, (B) acts of the Indenture Trustee not permitted by,
or failure of the Indenture Trustee to take any action required by, the
Operative Documents to the extent such acts arise or such failure arises
from or constitutes gross negligence or willful misconduct, (C) claims
against the Indenture Trustee relating to Taxes or Expenses which are
excluded from the indemnification provided by Section 6 of the
Participation Agreement pursuant to said Section 6, or (D) claims against
the Indenture Trustee arising out of the transfer by the Indenture Trustee
of all or any portion of its interest in the Aircraft, the Trust Estate,
the Trust Indenture Estate or the Operative Documents other than a transfer
of the Aircraft pursuant to Section 9, 10 or 19 of the Lease or Article IV
or V of the Trust Indenture, or a transfer of the Aircraft pursuant to
Section 15 of the Lease while an Event of Default is continuing and prior
to the time that the Indenture Trustee has received all amounts due
pursuant to the Trust Indenture.
"Insurance Brokers" has the meaning specified for such term in
Exhibit H to the Lease.
["Initial Rent Payment Date" means ________, ____] (6)
______________________
(6) For deferred equity deals only.
"Intercreditor Agreement" means that certain Intercreditor
Agreement, dated as of August 31, 1999, among the Pass Through Trustees,
the Liquidity Provider and the Subordination Agent.
"Law" means (a) any constitution, treaty, statute, law,
regulation, order, rule or directive of any Government Entity, and (b) any
judicial or administrative interpretation or application of, or decision
under, any of the foregoing.
"Lease" means that certain Lease Agreement (US Airways, Inc.
Trust No. N___U_), dated as of _________ __, ____, entered into by the
Owner Trustee and Lessee concurrently with the execution and delivery of
the Trust Indenture, as said Lease Agreement has been, or 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 of the Trust
Indenture. The term "Lease" shall also include each Lease Supplement from
time to time entered into pursuant to the terms of the Lease.
"Lease Default" means any event which with the giving of notice
or the lapse of time or both would become a Lease Event of Default.
"Lease Event of Default" means an "Event of Default" as defined
in Section 14 of the Lease.
"Lease Period" means (i) with respect to the Basic Term the
"Lease Periods" identified on Exhibit B-3 to the Lease and (ii) with
respect to any Renewal Term, each of the consecutive periods throughout
such Renewal Term ending on a Rent Payment Date, the first such period
commencing on and including the first day of such Renewal.
"Lease Supplement" means a Lease Supplement, substantially in the
form of Exhibit A to the Lease, to be entered into between Lessor and
Lessee on the Delivery Date for the purpose of leasing the Aircraft under
and pursuant to the terms of the Lease, and any subsequent Lease Supplement
entered into in accordance with the terms of the Lease.
"Lessee" means US Airways, Inc., a Delaware corporation.
"Lessee Documents" means the Participation Agreement, the Lease,
the Lease Supplement covering the Aircraft, the Purchase Agreement (insofar
as it relates to the Aircraft), the FAA Bill of Sale, the Bill of Sale, the
Purchase Agreement Assignment, the Tax Indemnity Agreement and each other
agreement between the Lessee and any other party to the Lease delivered on
the Delivery Date.
"Lessor" means First Security Bank, National Association, not in
its individual capacity, but solely as Owner Trustee, or any of its
successors and permitted assigns acting as lessor under the Lease.
"Lessor Liens" means any Lien or disposition of title or interest
arising as a result of (i) claims against Lessor, First Security Bank,
National Association, in its individual capacity, or the Owner Participant
not related to the transactions contemplated by the Operative Documents,
(ii) any act or omission of the Owner Participant, Lessor, or First
Security Bank, National Association, in its individual capacity, which is
not related to the transactions contemplated by the Operative Documents or
is in violation of any of the terms of the Operative Documents, (iii)
claims against the Owner Participant, Lessor, or First Security Bank,
National Association, in its individual capacity, with respect to Taxes or
Expenses against which Lessee is not required to indemnify the Owner
Participant, Lessor or First Security Bank, National Association, in its
individual capacity, pursuant to Section 6 of the Participation Agreement
or (iv) claims against Lessor or the Owner Participant arising out of any
transfer by Lessor or the Owner Participant of all or any portion of the
respective interests of Lessor or the Owner Participant in the Aircraft,
the Trust Estate or the Operative Documents other than the transfer of
possession of the Aircraft by Lessor pursuant to the Lease, the transfer
pursuant to the Trust Indenture or a transfer of the Aircraft pursuant to
Section 9, 10 , 19 or 20 of the Lease or pursuant to the exercise of the
remedies set forth in Section 15 of the Lease.
"Lessor's Cost" for the Aircraft means the amount denominated as
such in Exhibit B-4 to the Lease.
"Lien" means any mortgage, pledge, lien, charge, claim,
encumbrance, lease, sublease, sub-sublease or security interest.
"Liquidity Facilities" means the three Revolving Credit
Agreements, each dated August 31, 1999, between the Subordination Agent, as
borrower, and the Liquidity Provider, and any replacement thereof, in each
case as the same may be amended, modified or supplemented.
"Liquidity Provider" means AIG Matched Funding Corp., as Class A
Liquidity Provider, Class B Liquidity Provider and Class C Liquidity
Provider under the Liquidity Facilities, or any successor thereto.
"Loan Participant" means each Purchaser and its respective
successors and registered assigns, including any Note Holder.
"Loan Participant Liens" means any Lien which arises from acts or
claims against any Loan Participant not related to the transactions
contemplated by the Operative Documents.
"Loss Payment Date" has the meaning specified for such term in
Section 10(a) of the Lease.
"Majority in Interest of Note Holders" as of a particular date of
determination means the holders of more than a majority in aggregate unpaid
Principal Amount of all Equipment Notes outstanding as of such date
(excluding 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 Trust Indenture (unless all
Equipment Notes then outstanding shall be held by the Owner Trustee or the
Owner Participant) or 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 Treasury Yield
exceeds (b) the outstanding principal amount of such Equipment Note plus
accrued interest. For purposes of determining the Make-Whole Amount,
"Treasury Yield" means, at the time of determination, 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 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 and (B) the other maturing as close as possible
to, but later than, the Average Life Date, 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 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. "Average Life Date" means,
for each Equipment Note to be redeemed, 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.
"Manufacturer" means Airbus Industrie G.I.E., a groupement
d'interet economique established under Ordonnance No. 67-821 dated
September 23, 1967 of the Republic of France, and its successors and
assigns.
"Manufacturer Documents" means the Purchase Agreement and the
Consent and Agreement.
"Mortgaged Property" has the meaning specified for such term in
Section 3.03 of the Trust Indenture.
"Multiplier" means (i) on any date when no Class C Special
Indemnity Event is continuing , 0.00, (ii) on each day during the first
ninety (90)-day period immediately following the occurrence of a Class C
Special Indemnity Event, 0.0025, and (iii) thereafter, on each day during
each subsequent ninety (90)-day period for so long as such Class C Special
Indemnity Event exists, the Multiplier in effect for the immediately
preceding ninety (90)-day period plus 0.0025; provided, that (a)
notwithstanding the foregoing, the maximum Multiplier shall be 0.01, and
(b) the Multiplier shall reset after such Class C Special Indemnity Event
has ceased or no longer exists and clause (i) shall apply again to any
subsequent Class C Special Indemnity Event.
"Net Economic Return" has the meaning specified for such term in
paragraph 2 of Exhibit E to the Lease.
"Net Present Value of Rents" means the net present value, as of
the date of calculation, of Basic Rent set forth in Exhibit B-2 to the
Lease, discounted at an annual interest rate of ten percent (10%) on a
semi-annual basis.
"New Debt" has the meaning specified for such term in Section
16(a) of the Participation Agreement.
"Non-U.S. Person" means any Person other than a U.S. Person.
"Note Holder" means any holder from time to time of one or more
Equipment Notes.
"Note Purchase Agreement" means the Note Purchase Agreement dated
as of the Pass Through Trust Closing Date among Lessee, the Pass Through
Trustee for the Class A, Class B and Class C Pass Through Trusts, the
Subordination Agent, First Security Bank, National Association, as Escrow
Agent, and State Street Bank and Trust Company of Connecticut, National
Association, as Paying Agent.
"Obsolete Parts" has the meaning specified for such term in
Section 8(c) of the Lease.
"Operative Documents" means, collectively, the Participation
Agreement, the Lease, the Trust Indenture, the Trust Agreement, an
acceptance certificate covering the Aircraft in the form agreed to by the
Participants and Lessee, the Tax Indemnity Agreement, the Lease Supplement
covering the Aircraft, the Trust Supplement covering the Aircraft, the
Equipment Notes, the Bill of Sale, the FAA Bill of Sale, the French Pledge
Agreement, the Purchase Agreement (insofar as it relates to the Aircraft),
the Purchase Agreement Assignment and the Consent and Agreement (each, an
"Operative Document").
"Operative Indentures" means each of the indentures under which
notes have been issued and purchased by the Pass Through Trustees.
"Owner Indemnitee" has the meaning specified for such term in the
definition of Excluded Payments.
"Owner Participant" means ___________________, a [_____________]
corporation, so long as such party shall have any interest in the Trust
Estate, and transferees thereof as permitted by Section 7(k) of the
Participation Agreement and Section 8.01 of the Trust Agreement.
"Owner Participant Documents" means the Participation Agreement,
the Trust Agreement, and the Tax Indemnity Agreement and each other
agreement between the respective parties thereto relating to the subject
matter thereof, delivered on the Delivery Date.
"Owner Trustee" means First Security Bank, National Association,
not in its individual capacity but solely as owner trustee, and any entity
appointed as successor Owner Trustee pursuant to Section 9.01 of the Trust
Agreement, and references to a predecessor Owner Trustee in its individual
capacity by name in the Operative Documents shall include such successor
Owner Trustee in its individual capacity from and after such succession.
"Owner Trustee Documents" means the Participation Agreement, the
Trust Agreement, the Trust Supplement covering the Aircraft, the Lease, the
Lease Supplement covering the Aircraft, the Purchase Agreement Assignment,
the French Pledge Agreement, the Trust Indenture and the Equipment Notes
and each other agreement between the respective parties thereto relating to
the subject matter thereof, delivered on the Delivery Date.
"Owner Trustee's pro rata share" has the meaning specified for
such term in the Trust Indenture.
"Participants" means the Loan Participants and the Owner
Participant, collectively (each individually, a "Participant").
"Participation Agreement" means that certain Participation
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the dated of
the Lease, among the Owner Trustee, the Subordination Agent, the Indenture
Trustee, Lessee, the Owner Participant and the Pass Through Trustee, as the
same may from time to time be supplemented or further amended, or the terms
thereof waived or modified, to the extent permitted by, and in accordance
with, the terms thereof.
"Parts" means all appliances, parts, instruments, appurtenances,
accessories, furnishings and other equipment of whatever nature (other than
(a) complete Engines or engines, (b) any items leased by Lessee from a
third party (other than Lessor) and (c) cargo containers) which may from
time to time be incorporated or installed in or attached to the Airframe or
any Engine or so long as title thereto shall remain vested in Lessor in
accordance with Section 8 of the Lease after removal therefrom; provided
that "Parts" shall not include Passenger Convenience Equipment.
"Pass Through Certificates" means the pass through certificates
to be issued by the Pass Through Trustee in connection with the
Transactions.
"Pass Through Documents" means the Participation Agreement, the
Pass Through Trust Agreements, the Note Purchase Agreement, the Deposit
Agreements, the Escrow Agreements, the Liquidity Facilities and the
Intercreditor Agreement.
"Pass Through Indemnitees" means (i) the Subordination Agent, the
Liquidity Provider and the Pass Through Trustee, (ii) each Affiliate of a
Person described in the preceding clause (i), (iii) the respective
directors, officers, employees, agents and servants of each of the Persons
described in the preceding clauses (i) and (ii), and (iv) the successors
and permitted assigns of the Persons described in the preceding clauses
(i), (ii) and (iii).
"Pass Through Trust" means, collectively, the three separate
grantor trusts set forth in Schedule III to the Participation Agreement
created, pursuant to the Pass Through Trust Agreement, to facilitate
certain of the transactions contemplated by the Operative Documents.
"Pass Through Trust Agreement" means the pass through trust
agreement and each of the three separate pass through trust supplements
referred to on Schedule III to the Participation Agreement.
"Pass Through Trust Closing Date" means August 31, 1999.
"Pass Through Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, a national banking association, in
its capacity as trustee under each Pass Through Trust Agreement, and each
other Person that may from time to time be acting as successor trustee
under any such Pass Through Trust Agreement.
"Passenger Convenience Equipment" means available components or
systems installed on or affixed to the Airframe that are used to provide
individual telecommunications to passengers aboard the Aircraft.
"Past Due Rate" has the meaning specified for such term in
Exhibit B to the Lease.
"Payment Date" means each January 20 and July 20, commencing on
________, ____ (or, if any such day is not a Business Day, the immediately
succeeding Business Day) until the Equipment Notes have been paid in full.
"Permitted Foreign Air Authority" means the Civil Aviation
Authority of the United Kingdom, the Direction Generale de l'Aviation
Civile of the French Republic, the Luftfahrt Bundesamt of the Federal
Republic of Germany, the Rijflauchtraatdienst of the Kingdom of the
Netherlands, the Ministry of Transportation of Japan or the Federal
Ministry of Transport of Canada (and any agency or instrumentality of the
applicable government succeeding to the functions of any of the foregoing
entities).
"Permitted Lien" means any Lien referred to in clauses (i)
through (viii) of Section 6 of the Lease.
"Permitted Sublessee" means any entity domiciled in a country
listed in Exhibit F to the Lease as in effect from time to time and as may
be modified in accordance with Section 7(d) of the Participation Agreement.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"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" means the [Sale and Purchase Agreement,
dated as of October 31, 1997, between the Seller and US Airways Group,
[Purchase Agreement dated as of November 24, 1998 between US
Inc., ] (7) [Purchase Agreement dated as of November 24, 1998 between US
Airways Group, Inc. and the Seller ] (8) (including all exhibits thereto,
together with all letter agreements entered into that by their terms
constitute part of any such Purchase Agreement), as the same may be amended
or otherwise supplemented from time to time, as the same has been assigned
to Lessee, relating to the purchase by Lessee of the Aircraft.
____________________
(7) For A319 and A320 Aircraft transactions.
(8) For A330 Aircraft transactions.
"Purchase Agreement Assignment" means the Purchase Agreement
Assignment (US Airways, Inc. Trust No. N___U_), dated as of the date of
the Lease, between Lessee and Lessor, as the same may be amended,
supplemented or modified from time to time, with a form of Consent and
Agreement to be executed by the Seller attached thereto.
"Purchase Option Date" has the meaning specified for such term in
Section 19(b) of the Lease.
"Purchasers" means the Pass Through Trustees under each Pass
Through Trust Agreement.
"QIB" has the meaning specified for such term in Section 2.08 of
the Trust Indenture.
"Qualified Owner Participant" means a Person (x) that is not an
Affiliate of Lessee and (y) that has a tangible net worth, calculated in
accordance with generally accepted accounting principles, greater than
$50,000,000 or such other amount as is acceptable to Lessee, or (z) whose
obligations under the Operative Documents are unconditionally guaranteed by
a Person meeting the requirements of clauses (x) and (y).
"Refinancing Certificate" has the meaning specified for such term
in Section 16(a) of the Participation Agreement.
"Refinancing Date" has the meaning specified for such term in
Section 16(a) of the Participation Agreement.
"Refinancing Information" has the meaning specified for such term
in Section 16(a) of the Participation Agreement.
"Registration Agreement" means the Registration Agreement dated
August 31, 1999 by Lessee, and confirmed and accepted by AIFS, in respect
of the 7.96% Pass Through Certificates, Series 1999-1, Class C, as such
Registration Agreement may be amended, modified and supplemented from time
to time in accordance with the provisions thereof.
"Remaining Weighted Average Life" of an Equipment Note, at the
redemption date of such Equipment Note, means 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.
"Renewal Term" means any Fixed Renewal Term or Fair Market
Renewal Term.
"Rent" means Basic Rent and Supplemental Rent, collectively.
"Rent Payment Date" means ____________, 2000, each succeeding
January 20 and July 20 in the Term, the Basic Term Expiration Date, and the
last day of any Renewal Term.
"Replacement Airframe" means any airframe substituted for the
Airframe pursuant to Section 10 of the Lease.
"Replacement Engine" means any engine substituted for an Engine
pursuant to Sections 9(c) and 10 of the Lease.
"Responsible Officer" means with respect to the Owner Trustee, a
responsible officer in the Trust Office of the Owner Trustee (including,
without limitation, any authorized officer in the Trust Office of the Owner
Trustee), and with respect to the Indenture Trustee, a responsible officer
in the Corporate Trust Office of the Indenture Trustee.
"Scheduled Delivery Date" has the meaning specified for such term
in Section 2(f) of the Participation Agreement.
"Section 1110 Period" has the meaning specified for such term in
Section 4.04(a) of the Trust Indenture.
"Secured Obligations" has the meaning specified for such term in
the Granting Clause of the Trust Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" means AVSA, S.A.R.L., a societE a responsabilite limitee
organized and existing under the laws of the Republic of France.
"Senior Holder" has the meaning specified for such term in
Section 2.15(c) of the Trust Indenture.
"Series A" or "Series A Equipment Notes" means Equipment Notes
issued and designated as "Series A" under the Trust Indenture, in the
Principal Amount and maturities and bearing interest as specified in
Schedule I to the Trust Indenture under the heading "Series A."
"Series B" or "Series B Equipment Notes" means Equipment Notes
issued and designated as "Series B" under the Trust Indenture, in the
Principal Amount and maturities and bearing interest as specified in
Schedule I to the Trust Indenture under the heading "Series B."
"Series C" or "Series C Equipment Notes" means Equipment Notes
issued and designated as "Series C" under the Trust Indenture, in the
Principal Amount and maturities and bearing interest as specified in
Schedule I to the Trust Indenture under the heading "Series C."
"Significant Expenditure" means an expenditure or planned
expenditure of the type described in clause (B) of the definition of
Burdensome Termination Event.
"State Street" means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its capacity as Indenture Trustee under the Trust Indenture, but in its
individual capacity.
"Sublease" means any sublease permitted by the terms of Section
7(b)(x) of the Lease.
"Sublessee" means any Person for so long, but only so long, as
such Person is in possession of the Airframe and/or any Engine pursuant to
the terms of a Sublease which is then in effect pursuant to Section 7(b)(x)
of the Lease.
"Subordination Agent" means State Street Bank and Trust Company
of Connecticut, National Association, a national banking association, as
subordination agent under the Intercreditor Agreement, or any successor
thereto.
"Subsequent Owner Participant" means any entity to which the
Owner Participant or any transferee from the Owner Participant or any
Subsequent Owner Participant shall have transferred at any time after the
Delivery Date all of the undivided right, title and interest originally
held by the Owner Participant in the Trust Agreement, the Trust Estate and
the Participation Agreement, to the extent permitted by Section 8.01 of the
Trust Agreement and Section 7(k) of the Participation Agreement.
"Supplemental Rent" means, without duplication, (a) all amounts,
liabilities, indemnities and obligations (other than Basic Rent) that
Lessee assumes or becomes obligated to or agrees to pay under any Lessee
Document to or on behalf of Lessor or any other Person, including, without
limitation, payments of Termination Value, any amounts in respect of a
purchase price payable pursuant to Section 19(c) or 20 of the Lease and
payments of indemnities under Section 6 of the Participation Agreement, but
excluding any amount as to which Lessee is obligated to pay a pro rata
share pursuant to clause (d) or (e) of this definition, (b) (i) to the
extent not payable (whether or not in fact paid) under Section 7(a) of the
Note Purchase Agreement (as originally in effect or amended with the
consent of the Owner Participant), an amount or amounts equal to the fees
payable to the Liquidity Provider under Section 2.03 of each Liquidity
Facility and the related Fee Letter (as defined in the Intercreditor
Agreement) multiplied by a fraction the numerator of which shall be the
then outstanding aggregate principal amount of the Series A Equipment
Notes, Series B Equipment Notes and Series C Equipment Notes and the
denominator of which shall be the then outstanding aggregate principal
amount of all "Series A Equipment Notes", "Series B Equipment Notes" and
"Series C Equipment Notes" (in each case as defined in the relevant
Operative Indenture) issued under the Operative Indentures; (ii) (x) the
amount equal to interest on any Downgrade Advance (other than any Applied
Downgrade Advance) payable under Section 3.07 of each Liquidity Facility
minus Investment Earnings from such Downgrade Advance multiplied by (y)
the fraction specified in the foregoing clause (i); (iii) (x) the amount
equal to interest on any Non-Extension Advance (other than any Applied Non-
Extension Advance) payable under Section 3.07 of each Liquidity Facility
minus Investment Earnings from such Non-Extension Advance multiplied by (y)
the fraction specified in the foregoing clause (i); (iv) if any payment
default shall have occurred and be continuing with respect to interest on
any Series A Equipment Note, Series B Equipment Note or Series C Equipment
Note, (x) the excess, if any, of (1) an amount equal to interest on any
Unpaid Advance, Applied Downgrade Advance or Applied Non-Extension Advance
payable under Section 3.07 of each Liquidity Facility over (2) the sum of
Investment Earnings from any Final Advance plus any amount of interest at
the Past Due Rate actually payable (whether or not in fact paid) by Lessee
in respect of the overdue scheduled interest on the Equipment Notes in
respect of which such Unpaid Advance, Applied Downgrade Advance or Applied
Non-Extension Advance was made multiplied by (y) a fraction the numerator
of which shall be the then aggregate overdue amounts of interest on the
Series A Equipment Notes, Series B Equipment Notes and Series C Equipment
Notes (other than interest becoming due and payable solely as a result of
acceleration of any such Equipment Notes) and the denominator of which
shall be the then aggregate overdue amounts of interest on all "Series A
Equipment Notes", "Series B Equipment Notes" and "Series C Equipment
Notes" (in each case as defined in the relevant Operative Indenture) issued
under the Operative Indentures (other than interest becoming due and
payable solely as a result of acceleration of any such "Equipment Notes,"
(in each case as defined in the relevant Operative Indenture) issued under
the Operative Indentures); and (v) Lessee's pro rata share of any other
amounts owed to the Liquidity Provider by the Subordination Agent as
borrower under each Liquidity Facility (other than amounts due as
repayment of advances thereunder or as interest on such advances), except
to the extent payable pursuant to clause (i), (ii), (iii) or (iv) above,
(c) Lessee's pro rata share of all compensation and reimbursement of
expenses, disbursements and advances payable by Lessee under the Pass
Through Trust Agreements, (d) Lessee's pro rata share of all compensation
and reimbursement of expenses and disbursements payable to the
Subordination Agent under the Intercreditor Agreement except with respect
to any income or franchise taxes incurred by the Subordination Agent in
connection with the transactions contemplated by the Intercreditor
Agreement and (e) Lessee's pro rata share of any amount payable under
Section 6(c) of the Participation Agreement to any Pass Through Indemnitee
to the extent such amount relates to, results from or arises out of or in
connection with (i) the Pass Through Trust Agreement or the enforcement of
any of the terms of any Pass Through Document, (ii) the offer, sale, or
delivery of the Pass Through Certificates or any interest therein or
represented thereby or (iii) any breach of or failure to perform or
observe, or any other noncompliance with, any covenant or agreement or
other obligation to be performed by Lessee under any Pass Through Document
or the falsity of any representation or warranty of Lessee in any Pass
Through Document. As used herein, "Lessee's pro rata share" means as of
any time a fraction, the numerator of which is the principal balance then
outstanding of Equipment Notes and the denominator of which is the
aggregate principal balance then outstanding of all "Equipment Notes" (in
each case as defined in the relevant Operative Indenture) issued under the
Operative Indentures. For purposes of this definition, the terms "Applied
Downgrade Advance", "Applied Non-Extension Advance", "Cash Collateral
Account", "Downgrade Advance", "Final Advance", "Investment Earnings",
"Non-Extension Advance" and "Unpaid Advance" shall have the meanings
specified in each Liquidity Facility. For the avoidance of doubt, it is
understood and agreed that Supplemental Rent includes, without limitation,
any amounts payable under the third paragraph of Section 2.02 of the Trust
Indenture.
"Tax Indemnitee" means (i) the Owner Participant, the Owner
Trustee, in its individual capacity and as trustee under the Trust
Agreement, the Trust Estate, the Indenture Trustee, (ii) the respective
Affiliates, successors and permitted assigns of each of the entities
described in the preceding clause (i), and (iii) the Trust Indenture
Estate.
"Tax Indemnity Agreement" means that certain Tax Indemnity
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the date of the
Lease, between the Owner Participant and Lessee, as originally executed or
as modified, amended or supplemented pursuant to the applicable provisions
thereof.
"Taxes" means any and all fees (including, without limitation,
license, recording, documentation and registration fees), taxes (including,
without limitation, income, gross receipts, sales, rental, use, turnover,
value added, property (tangible and intangible), excise and stamp taxes),
license, levies, imposts, duties, recording charges and assessments of any
kind whatsoever that are in the nature of taxes or other governmental
charges including interest, penalties and additions to tax (each,
individually a "Tax").
"Term" means the Basic Term and, if actually entered into, any
Renewal Term.
"Termination Date" has the meaning set forth in Section 9(a) of
the Lease.
"Termination Value" with respect to the Aircraft (a) as of any
date during the Basic Term means, but subject always to the provisions of
Section 3(c)(v) of the Lease, the amount determined by multiplying Lessor's
Cost for the Aircraft by the percentage specified in Exhibit C to the Lease
under the caption "Total Termination Payment" opposite the Termination
Value Date with respect to which the amount is determined (as such Exhibit
C may be adjusted from time to time as provided in Section 3(c) of the
Lease and as expressly provided in any other Operative Document) [(such
Termination Value shall equal the sum of, and represent, (i) a payment (or
reduction) of Basic Rent in an amount equal to the "Basic Rent Amount" set
forth on Exhibit C to the Lease (which includes all amounts of Basic Rent
allocated to any period prior to the termination and not yet paid and
reduced by all amounts paid prior to the termination and allocated to
periods after the termination and (ii) a payment of the "Termination
Amount" set forth on Exhibit C to the Lease)] and (b) as of any date during
the Renewal Term, shall have the meaning set forth in Section 19(a)(5) of
the Lease.
"Termination Value Date" means each date set forth on Exhibit C
to the Lease under the caption "Termination Date."
"Transaction Expenses" means: all of the reasonable out-of-pocket
costs, fees and expenses incurred by Lessee, the Owner Trustee, the Pass
Through Trustee, the Subordination Agent and the Indenture Trustee in
connection with the transactions contemplated by the Participation
Agreement, the other Operative Documents, the Pass Through Trust
Agreements, the Pass Through Documents, the Intercreditor Agreement, the
Liquidity Facilities and the Underwriting Agreement (except, in each case,
as otherwise provided therein) including, without limitation:
(a) the reasonable and actual fees, expenses and
disbursements of (A) Bingham Dana LLP, special counsel for the Pass Through
Trustee, the Subordination Agent and the Indenture Trustee, (B) Ray,
Quinney & Nebeker, special counsel for the Owner Trustee, (C) Milbank,
Tweed, Hadley & McCloy LLP, special counsel for the Underwriters, and (D)
Crowe & Dunlevy, P.C., special counsel in Oklahoma City, Oklahoma and (E)
Simpson Thacher & Bartlett, special counsel to AIFS;
(b) the initial fees and reasonable and actual disbursements
of the Owner Trustee under the Trust Agreement;
(c) the initial fee and reasonable and actual disbursements
of the Indenture Trustee under the Trust Indenture;
(d) the initial fees and expenses of the Liquidity Provider,
the Pass Through Trustee and the Subordination Agent;
(e) underwriting fees and commissions;
(f) the fees and expenses with respect to the appraisal of
the Aircraft;
(g) the reasonable fees, expenses and disbursements of
_________________, special counsel to the Owner Participant, such fees not
to exceed the amount previously agreed to by the Owner Participant and
Lessee;
(h) the fees, expenses and disbursements of Skadden, Arps,
Slate, Meagher & Flom LLP and its affiliates, special counsel for Lessee;
(i) the costs of filing and recording documents with the FAA
and filing Uniform Commercial Code statements in the United States;
(j) the reasonable fees, expenses and disbursements of
special counsel to the Liquidity Provider;
(k) the expenses of the Depositary payable under Section
10(a) of each Indemnity Agreement; and
(l) the reasonable fees, expenses and disbursements of
special counsel to the Seller and the Manufacturer.
"Transactions" means the transactions contemplated by the
Participation Agreement and the other Operative Documents.
"Transferee" has the meaning specified for such term in Section
7(k) of the Participation Agreement.
"Transportation Code" means that portion of the United States Code
comprising those provisions formerly referred to as the Federal Aviation
Act of 1958, as amended, or any subsequent legislation that amends,
supplements or supersedes such provisions.
"Trust Agreement" means that certain Trust Agreement (US Airways,
Inc. Trust No. N___U_), dated as of the date of the Lease, between the
Owner Participant and First Security Bank, National Association, in its
individual capacity, as originally executed or as modified, amended or
supplemented pursuant to the applicable provisions thereof, including,
without limitation, supplementation thereof by one or more Trust
Supplements entered into pursuant to the applicable provisions thereof.
"Trust Agreement and Indenture Supplement" or "Trust Supplement"
means a supplement to the Trust Agreement and the Trust Indenture,
substantially in the form of Exhibit A to the Trust Indenture, which shall
particularly describe the Aircraft, and any Replacement Airframe and
Replacement Engine included in the property of the Owner Trustee covered by
the Trust Agreement.
"Trust Estate" means all estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Purchase Agreement, the Purchase Agreement Assignment, the Bill of Sale and
the FAA Bill of Sale, including, without limitation, all amounts of Basic
Rent and Supplemental Rent including without limitation insurance proceeds
(other than insurance proceeds payable to or for the benefit of the Owner
Trustee, for its own account or in its individual capacity, the Owner
Participant, the Loan Participants or the Indenture Trustee) and
requisition, indemnity or other payments of any kind for or with respect to
the Aircraft (except amounts owing to the Owner Participant, to the
Indenture Trustee, to the Owner Trustee, in its individual capacity, or to
the Loan Participants or any other holder of a Equipment Note, or to any of
their respective directors, officers, employees, servants and agents,
pursuant to Section 6 of the Participation Agreement). Notwithstanding the
foregoing, "Trust Estate" shall not include any Excluded Payments.
"Trust Indenture" means that certain Trust Indenture and Security
Agreement (US Airways, Inc. Trust No. N___U_), dated as of the date of the
Lease, between Lessor and the Indenture Trustee, as it may from time to
time be supplemented or amended as therein provided, including
supplementing by the Trust Agreement and Indenture Supplement pursuant to
the Trust Indenture.
"Trust Indenture Estate" means all estate, right, title and
interest of the Indenture Trustee in and to the properties referred to in
the Granting Clause of the Trust Indenture, excluding Excluded Payments.
"Underwriters" means Credit Suisse First Boston Corporation,
Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities Corporation,
Deutsche Bank Securities Inc. and Salomon Smith Barney Inc.
"U.S. Air Carrier" means any Certificated Air Carrier as to which
there is in force an air carrier operating certificate issued pursuant to
Part 121 of the regulations under the Transportation Code, or which may
operate as an air carrier by certification or otherwise under any successor
or substitute provisions therefor or in the absence thereof.
"U.S. Person" means any Person that qualifies as a "United States
person" under Section 7701(a)(30) of the Code.
"Wet Lease" means any arrangement whereby the Lessee (or any
Sublessee) agrees to furnish the Airframe and Engines or engines installed
thereon to a third party pursuant to which such Airframe and Engines or
engines (i) shall be operated solely by regular employees of Lessee (or any
Sublessee) possessing all current certificates and licenses that would be
required under the Transportation Code, or, if the Aircraft is not
registered in the United States, all certificates and licenses required by
the laws of the jurisdiction of registry, for the performance by such
employees of similar functions within the United States of America or such
other jurisdiction of registry (it is understood that cabin attendants need
not be regular employees of Lessee (or any Sublessee)) and (ii) shall be
maintained by Lessee (or any Sublessee) in accordance with its normal
maintenance practices.
[FORM OF SASM&F (ILLINOIS)
OPINION FOR LEASED AIRCRAFT]
__________, [1999][2000]
To Each Person Listed on
Schedule I Hereto
Re: US Airways, Inc. Trust No. N
Ladies and Gentlemen:
We have acted as special counsel to US Airways, Inc., a Delaware
corporation ("US Airways"), in connection with the execution and delivery
of (i) the Participation Agreement (US Airways, Inc. Trust No. N______),
dated as of __________, [1999][2000] (the "Participation Agreement"),
among US Airways, as Lessee, ____________, as Owner Participant, State
Street Bank and Trust Company of Connecticut, National Association, a
national banking association, not in its individual capacity except as
otherwise provided therein, but solely as Pass Through Trustee, Indenture
Trustee and Subordination Agent, and First Security Bank, National
Association, a national banking association, not in its individual capacity
except as otherwise stated, but solely as Owner Trustee, relating to the
Aircraft described in the Lease Supplement (as defined below); (ii) the
Lease Agreement (US Airways, Inc. Trust No. N______), dated as of ___ __,
[1999][2000], between the Owner Trustee, as Lessor, and US Airways, as
Lessee (the "Lease"); (iii) the Lease Supplement (US Airways, Inc. Trust
No. N_______), dated ___ ___, [1999][2000], between the Owner Trustee and
US Airways (the "Lease Supplement"); (iv) the Purchase Agreement
Assignment, dated as of ____ ___, [1999][2000], between the Owner Trustee
and US Airways (the "Purchase Agreement Assignment"); (v) the warranty bill
of sale, dated the date hereof, executed by US Airways (the "Warranty Bill
of Sale"); (vi) the FAA Bill of Sale on Form 8050-1 dated the date hereof
(the "FAA Bill of Sale"); (vii) the acceptance certificate dated the date
hereof executed by US Airways (the "Acceptance Certificate"); (viii) the
Pass Through Trust Agreement, dated as of _____________, 1999, between the
Pass Through Trustee and US Airways (the "Pass Through Trust Agreement");
and (ix) each of the Pass Through Trust Supplements dated as of ________,
1999 (collectively, the "Pass Through Trust Supplements"). This opinion is
being delivered pursuant to Section 4(a)(xi) of the Participation
Agreement.
In our examination, we have assumed the genuineness of all
signatures, including indorsements, the legal capacity of natural persons,
the authenticity of all documents submitted to us as originals, the
conformity to original documents of all copies submitted to us as
telefacsimile, certified or photostatic copies, and the authenticity of the
originals of such copies. As to any facts material to this opinion, we
have relied solely upon statements, representations and warranties of US
Airways, the Owner Participant, the Owner Trustee, the Indenture Trustee,
the Subordination Agent, the Pass Through Trustee and their respective
officers and representatives, and others in the Operative Documents and of
public officials, including the facts set forth in the Company's
Certificate described below, and we have made no independent investigation
or inquiry with respect to such factual matters.
In rendering the opinions set forth herein, we have examined and
relied on originals or copies of the following:
(a) the Participation Agreement;
(b) the Lease;
(c) the Lease Supplement;
(d) the Purchase Agreement Assignment;
(e) the Trust Indenture and Security Agreement (US Airways, Inc.
Trust No. N______), dated as of ____ ___, [1999][2000] (the "Trust
Indenture") between First Security Bank, National Association, not in its
individual capacity, except as expressly stated therein, but solely as
Owner Trustee, and State Street Bank and Trust Company of Connecticut,
National Association, as Indenture Trustee;
(f) the Trust Agreement and Indenture Supplement (US Airways, Inc.
Trust No. N_____) dated ______, [1999][2000] (the "Trust Supplement") of
First Security Bank, National Association, as Owner Trustee, in respect of
the Trust Indenture;
(g) the Warranty Bill of Sale;
(h) the Tax Indemnity Agreement;
(i) the FAA Bill of Sale;
(j) the Acceptance Certificate;
(k) the Equipment Notes;
(l) the Pass Through Trust Agreement;
(m) each of the Pass Through Trust Supplements;
(n) unfiled, but signed copies of financing statements naming
"First Security Bank, National Association, as Owner Trustee," as debtor
and "State Street Bank and Trust Company of Connecticut, as Indenture
Trustee" as secured party, which we understand will be filed within ten
(10) days of the transfer of the security interest in the Offices of the
Secretary of State of the State of New York (such filing Office, the "New
York Filing Office" and such financing Statements, the "New York Financing
Statement");
(o) a certificate of US Airways, dated the date hereof, a copy of
which is attached as Exhibit A;
(p) certified copies of the Certificate of Incorporation and By-
laws of US Airways;
(q) certified copies of certain resolutions of the Board of
Directors of US Airways adopted on ________;
(r) a certificate of good standing from the Secretary of State of
the State of Delaware as to the good standing of US Airways in such
jurisdiction; and
(s) such other documents as we have deemed necessary or
appropriate as a basis for the opinions set forth below.(1)
---------------
(1) For transactions involving subleases to Shuttle, include a
reference to Shuttle Sublease.
We express no opinion as to the laws of any jurisdiction other than
(i) the Applicable Laws of the State of New York, (ii) the General
Corporation Law of the State of Delaware and (iii) the Applicable Laws of
the United States of America. In this respect, we call to your attention
that certain of the Operative Documents are governed by laws of
jurisdictions other than those described above and we express no opinion as
to the effect of any such laws on the opinions expressed herein. In
addition, we express no opinion with respect to the Transportation Code or
the rules and regulations of the Federal Aviation Administration or the
effect thereof on the opinions herein stated.
Capitalized terms not otherwise defined herein have the meanings
assigned thereto in Annex A to the Participation Agreement. The documents
referred to in (a) through (d), (g) through (h), (j), (l) and (m) above
shall hereinafter be referred to collectively as the "Transaction
Documents". The documents referred to in (e) and (f) above shall
hereinafter be referred to collectively as the "Indenture Documents."
"Applicable Laws" shall mean those laws, rules, regulations which, in our
experience, are normally applicable to transactions of the type
contemplated by the Transaction Documents, the Indenture Documents and the
Equipment Notes, without our having made any special investigation as to
the applicability of any special law, rule or regulation, and which are not
the subject of a specific opinion herein referring to a particular law or
laws. "Governmental Approval" means any consent, approval, license,
authorization or validation of, or filing, recording or registration with,
any governmental authority pursuant to Applicable Laws. Unless otherwise
indicated, the "New York UCC" means the Uniform Commercial Code as in
effect on the date hereof in the State of New York.
Based upon the foregoing, and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that:
1. Each of the Transaction Documents constitutes the valid and
binding obligation of US Airways enforceable against US Airways in
accordance with its terms under the laws of the State of New York. Each of
the Indenture Documents constitutes the valid and binding obligation of
each of the parties thereto, enforceable against each such party in
accordance with its terms under the laws of the State of New York.
2. Neither the execution and delivery by US Airways of the
Transaction Documents nor the compliance by US Airways with the terms and
provisions thereof will contravene any Applicable Law of the State of New
York or any Applicable Law of the United States of America.
3. Except for (a) the due and timely filing and, where
appropriate, recording of (i) the FAA Bill of Sale, (ii) the Trust
Agreement, (iii) the Lease (with the Lease Supplement covering the
Aircraft, the Indenture and the Trust Supplement covering the Aircraft
attached as exhibits) and (iv) the Trust Indenture (with the Trust
Supplement covering the Aircraft attached as an exhibit), pursuant to the
Transportation Code, (b) the registration of the issuance and sale of the
Pass Through Certificates under the Securities Act, (c) compliance with the
securities law of each applicable state and (d) filing of appropriate UCC
Financing Statements and continuation statements, no Governmental Approval,
which has not been obtained or taken and is not in full force and effect,
is required in connection with the execution, delivery or enforceability
by US Airways of any of the Transaction Documents.
4. No registration of US Airways or any of the Pass Through Trusts
under the Investment Company Act of 1940, as amended, is required.
5. The Equipment Notes, when issued to and acquired by the Pass
Through Trustee, will be legal, valid and binding obligations of the Owner
Trustee enforceable against the Owner Trustee in accordance with their
terms and the terms of the Trust Indenture, as supplemented by the Trust
Supplement, and will be entitled to the benefits of the Trust Indenture, as
supplemented by the Trust Supplement.
6. The provisions of the Trust Indenture, as supplemented by the
Trust Supplement, are effective to create, in favor of the Indenture
Trustee to secure the Secured Obligations, a valid security interest in the
Owner Trustee's rights in that portion of the collateral described therein
which is subject to Article 9 of the New York UCC (the "UCC Collateral").
7. If the Lease and any Lease Supplement constitute "chattel
paper" within the meaning of Section 9-105 of the New York UCC (as to which
we express no opinion) then the security interest of the Indenture Trustee
therein will be perfected under the New York UCC upon the Indenture Trustee
taking possession of each original counterpart thereof in the State of New
York.
8. The New York Financing Statement is in appropriate form for
filing in the New York Filing Office. To the extent that the New York UCC
governs the perfection of a security interest in the Owner Trustee's rights
in the UCC Collateral, as to which we express no opinion, the security
interest in favor of the Indenture Trustee in the UCC Collateral described
in the New York Financing Statement will be perfected upon filing of the
New York Financing Statement in the New York Filing Office.
Our opinions in paragraphs 6, 7 and 8 with respect to the security
interest of the Indenture Trustee are subject to the following
qualifications:
(a) We have assumed the Owner Trustee owns, or with respect to
after-acquired property will own, the UCC Collateral, and we express no
opinion as to the nature or extent of the Owner Trustee's rights in or
title to any of the UCC Collateral, and we note that with respect to after-
acquired property, the security interest will not attach until US Airways
acquires ownership thereof.
(b) Our opinions with respect to the validity and perfection of
the security interest of the Indenture Trustee is limited to Article 9 of
the New York UCC, and such opinions do not address (i) laws of
jurisdictions other than New York, and of New York except for Article 9 of
the UCC, (ii) collateral of a type not subject to Article 9 of the
Applicable UCC, and (iii) what law governs perfection or priority of the
security interests granted in the collateral covered by this opinion.
(c) We call your attention that under the UCC, events occurring
subsequent to the date hereof may affect any security interest subject to
the UCC including, but not limited to, factors of the type identified in
Section 9-306 with respect to proceeds; Section 9-103 with respect to
changes in the location of the collateral and the location of a debtor; and
Sections 9-307, 9-308 and 9-309 with respect to subsequent purchasers of
the collateral. In addition, actions taken by a secured party (e.g.,
releasing or assigning the security interest, delivering possession of the
collateral to a debtor or another person and voluntarily subordinating a
security interest) may affect any security interest subject to the UCC.
(d) We express no opinion with respect to the priority of the
security interest of the Indenture Trustee.
(e) We call to your attention that with respect to any goods which
is an accession to, or commingled or processed with other goods, the
security interest of the Indenture Trustee may be limited by Section 9-314
or 9-315 of the New York UCC.
(f) In the case of any instrument, chattel paper, account or
general intangible which is itself secured by other property, we express no
opinion with respect to the Indenture Trustee's rights in and to such
underlying property.
(g) In the case of chattel paper, accounts or general intangibles,
we call to your attention that the security interest of the Indenture
Trustee for the benefit of the Pass Through Trustee may be subject to the
rights of account debtors, claims and defenses of account debtors and the
terms of agreements with account debtors.
(h) In the case of goods, we express no opinion regarding the
security interest of the Indenture Trustee for the benefit of the Pass
Through Trustee in any goods which are (i) an accession to, or commingled
or processed with other goods to the extent that the security interest of
the Indenture Trustee for the benefit of the Pass Through Trustee is
limited by Section 9-314 or 9-315 of the UCC or (ii) subject to a
certificate of title or a document of title.
(i) We express no opinion regarding the security interest of the
Indenture Trustee for the benefit of the Pass Through Trustee in any items
which are subject to a statute, regulation or treaty of the United States
of America which provides for a national or international registration or a
national or international certificate of title for the perfection of a
security interest therein or which specifies a place of filing different
from the place specified in the UCC for filing to perfect such security
interest.
(j) We express no opinion regarding the security interest of the
Indenture Trustee for the benefit of the Pass Through Trustee in any of the
UCC Collateral consisting of claims against any government or governmental
agency (including without limitation the United States of America or any
state thereof or any agency or department of the United States of America
or any state thereof).
(k) We have assumed that if the Trust maintains any place of
business in the State of New York, then the Trust shall be deemed to do
business in more than one county in the State of New York.
9. It is not necessary, in connection with the creation of the
beneficial interest of the Owner Participant in the Trust Estate under the
circumstances contemplated by the Participation Agreement to register such
beneficial interest under the Securities Act of 1933, as amended, or to
qualify the Trust Agreement or the Trust Indenture under the Trust
Indenture Act of 1939, as amended.
10. The Indenture Trustee acting in behalf of the holders of the
Equipment Notes will be entitled to the benefits of Section 1110 of the
Bankruptcy Code with respect to the Aircraft if US Airways is a debtor in a
case under Chapter 11 of the Bankruptcy Code.
11. [US Airways, as lessor under the sublease to US Airways
Shuttle, will be entitled to the benefits of Section 1110 of the Bankruptcy
Code with respect to the Aircraft if US Airways Shuttle is a debtor in a
case under Chapter 11 of the Bankruptcy Code.](2)
----------------
(2) All bracketed language is for Aircraft subleased to US Airways
Shuttle.
With respect to our opinion[s] in paragraph[s] 10 [and 11], we note
that a 1998 decision, Western Pacific Airlines, Inc. v. GATX (In re Western
Pacific Airlines, Inc.), 219 B.R. 305, on rehearing, 221 B.R. 1 (D. Colo.
1998), appeal dismissed as moot, vacatur denied, Boullioun Aircraft Holding
Co., Inc. v. Smith Management (In re Western Pacific Airlines, Inc.), 1999
WL 459469 (10th Cir. July 7, 1999), ruled that Section 1110 does not
apply in a case after the trustee timely makes the agreement specified in
Section 1110(a)(1)(A) and timely cures defaults outstanding as of the date
of the Chapter 11 petition or that occur during the first sixty days of the
case, with the result, among others, that the ability of a lessor to
exercise remedies based on a default that occurs after the first sixty days
of the Chapter 11 case would be subject to the automatic stay. We believe
that this decision construes Section 1110 in a manner that is inconsistent
with both the language of Section 1110 and the legislative history
explaining the purpose and operation of Section 1110. Accordingly, we
believe that the decision is an incorrect interpretation of Section 1110.
In addition, with respect to our opinion[s] in paragraph[s] 10 [and
11], we have, with your consent, relied on the US Airways Opinion to the
effect that [each of] US Airways [and US Airways Shuttle] is a "citizen of
the United States," as defined in Section 40102 of Title 49 of the United
States Code, and [each of US Airways and US Airways Shuttle] holds an air
carrier operating certificate issued by the Secretary of Transportation
pursuant to Chapter 447 of the United States Code for aircraft capable of
carrying ten or more individuals or 6,000 pounds or more of cargo. We have
also assumed that where the Indenture Trustee is acting as secured party,
the security interest of the Indenture Trustee in the Aircraft is
perfected.
Our opinions are subject to the following assumptions and
qualifications:
(a) enforcement of the Transaction Documents and the Indenture
Documents may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally and by general principles of equity (regardless of whether
enforcement is sought in equity or at law);
(b) certain of the remedial provisions with respect to the leased
property including waivers with respect to the exercise of remedies against
the leased property contained in the Lease, may be unenforceable in whole
or in part, but the inclusion of such provisions does not affect the
validity of the Lease, taken as a whole, and the Lease, taken as a whole,
together with applicable law, contains adequate provisions for the
practical realization of the benefits thereof;
(c) certain of the remedial provisions with respect to the
security including waivers with respect to the exercise of remedies against
the Trust Indenture Estate contained in the Trust Indenture, as
supplemented by the Trust Supplement, may be unenforceable in whole or in
part, but the inclusion of such provisions does not affect the validity of
each of the Trust Indenture, as supplemented by the Trust Supplement, taken
as a whole, and the Trust Indenture, as supplemented by the Trust
Supplement, taken as a whole, together with applicable law, contains
adequate provisions for the practical realization of the security thereof;
(d) we express no opinion as to the effect on the opinions
expressed herein of (i) the compliance or non-compliance of any party
(without in any way limiting other qualifications and assumptions made
herein, other than US Airways) to the Transaction Documents or the
Indenture Documents with any state, federal or other laws or regulations
applicable to it or (ii) the legal or regulatory status or the nature of
the business of any such party;
(e) we express no opinion as to the enforceability of any rights
to contribution or indemnification provided for in the Transaction
Documents or the Indenture Documents to the extent any such rights are
violative of the public policy (including, without limitation, the public
policy underlying any federal or state securities law, rule or regulation);
(f) we express no opinion as to any provision of any Transaction
Document or any Indenture Document that provides a penalty or to the extent
that it provides for an absolute and unconditional obligation to perform
such Transaction Document even though such Transaction Document or
Indenture Document is invalid or terminated or such performance would be
illegal; and
(g) with respect to our opinion that the New York choice of law
provision in the Transaction Documents and the Indenture Documents which
are expressly governed by New York law is enforceable, we rely upon, among
other things, the Act of July 19, 1984, Ch. 421, 1984 McKinney's Sess. Laws
of N.Y. 1406, (codified at N.Y. Gen. Oblig. Law sections 5-1401, 5-1402
(McKinney Supp. 1986) and N.Y. CPLR 327(b) (McKinney Supp. 1986) (the
"Act"), and our opinion is subject to the qualifications that such
enforceability (i) may be limited by public policy considerations of any
jurisdiction, other than the courts of the State of New York, in which
enforcement of such provisions, or of a judgement upon an agreement
containing such provisions, is sought, and (ii) as specified in the Act,
does not apply to the extent provided to the contrary in subsection two of
Section 1-105 of the Uniform Commercial Code for the State of New York.
In rendering the foregoing opinions, we have assumed, with your
consent, that:
(a) each of the Transaction Documents constitutes the legal, valid
and binding obligation of each party thereto (other than US Airways)
enforceable against each such party (other than US Airways) in accordance
with its terms;
(b) each of (i) the Owner Participant, (ii) State Street Bank and
Trust Company of Connecticut, National Association, (iii) First Security
Bank, National Association, and (iv) US Airways is duly organized and
validly existing in good standing under the laws of the jurisdiction of its
organization;
(c) each of (i) the Owner Participant, (ii) State Street Bank and
Trust Company of Connecticut, National Association, individually and as
Indenture Trustee, Subordination Agent and Pass Through Trustee, (iii)
First Security Bank, National Association, individually and as Owner
Trustee, and (iv) US Airways has full power, authority and legal right to
enter into and perform its respective obligations under, and consummate the
transactions contemplated by, each of the Transaction Documents and the
Indenture Documents to which it is a party;
(d) each of (i) the Owner Participant, (ii) State Street Bank and
Trust Company of Connecticut, National Association, individually and as
Indenture Trustee, Subordination Agent and Pass Through Trustee, (iii)
First Security Bank, National Association, individually and as Owner
Trustee, and (iv) US Airways has duly authorized, executed and delivered
each of the Transaction Documents and the Indenture Documents to which it
is a party;
(e) the execution, delivery and performance of the Transaction
Documents and the Indenture Documents by each of the parties thereto and
the consummation of the transactions contemplated thereby does not and will
not conflict with, contravene, violate or constitute a default under (i)
the respective certificate of incorporation, by-laws or other
organizational documents of any such party, (ii) any indenture, mortgage,
lease, agreement or other instrument to which any such party is a party or
by which it or any of its property may be bound or subject, (iii) any law,
rule or regulation of any jurisdiction (provided that we make no such
assumption with respect to Applicable Laws of the State of New York and
Applicable Laws of the United States of America insofar as such Applicable
Laws apply to US Airways, as to which we express our opinion in paragraph 2
herein) or (iv) any judicial or administrative order or decree of any
governmental authority;
(f) except for (i) the due and timely filing and, where
appropriate, recording of (A) the FAA Bill of Sale, (B) the Trust
Agreement, (C) the Lease (with the Lease Supplement covering the Aircraft,
the Indenture and the Trust Supplement covering the Aircraft attached as
exhibits) and (D) the Trust Indenture (with the Trust Supplement covering
the Aircraft attached as an exhibit), pursuant to the Transportation Code,
(ii) the registration of the issuance and sale of the Pass Through
Certificates under the Securities Act, (iii) compliance with the securities
law of each applicable state and (iv) the filing of appropriate UCC
financing statements, no consent, license, permit or approval of, or giving
of notice to, or registration with, or taking of any action in respect of,
any governmental authority of any jurisdiction is required in connection
with (X) the execution, delivery and performance by any party to any
Transaction Document of the respective Transaction Documents to which it is
a party, (Y) the consummation of the transactions contemplated thereby or
(Z) the legality, validity or enforceability of the Transaction Documents
or the Indenture Documents with respect to any party to any Transaction
Document or any Indenture Document (provided that we make no such
assumption with respect to those required by Applicable Laws as such
Applicable Laws apply to US Airways); and
(g) the Trust Agreement duly creates, for the benefit of the Owner
Participant, the trust interest in the trust estate which the Trust
Agreement by its terms purports to create and the trust purported to be
created by the Trust Agreement has been duly formed and is validly
existing.
With respect to US Airways, we understand that you are separately
receiving an opinion with respect to certain matters set forth above from
Howard L. Wu, Esq., Associate General Counsel to US Airways (the "US
Airways Opinion"). With respect to Transportation Code matters, we
understand that you are separately receiving an opinion with respect to
certain matters set forth above from Crowe & Dunlevy, P.C., special
Transportation Code counsel (the "TC Opinion"). With respect to the Owner
Trustee, we understand that you are separately receiving an opinion with
respect to certain matters set forth above from Ray, Quinney & Nebeker,
special counsel to the Owner Trustee (the "Owner Trustee Opinion"). With
respect to the Indenture Trustee, the Pass Through Trustee and the
Subordination Agent, we understand that you are separately receiving an
opinion with respect to certain matters set forth above from Bingham Dana
LLP, special counsel to the Indenture Trustee, the Pass Through Trustee and
the Subordination Agent (the "State Street Opinion"). With respect to the
Owner Participant, we understand that you are receiving separate opinions
with respect to certain matters set forth above from __________, special
counsel to the Owner Participant (the "OP Opinion;" and together with the
US Airways Opinion, the TC Opinion, the Owner Trustee Opinion and the State
Street Opinion, the "Other Counsel's Opinions"). We are advised that such
Other Counsel's Opinions contain qualifications. Our opinions herein
stated are based upon the assumptions specified above, and we express no
opinion as to the effect on the opinions herein stated of the
qualifications stated in the Other Counsel's Opinions.
This opinion is being furnished only to you and is solely for your
benefit and is not to be used, circulated, quoted, relied upon or otherwise
referred to by any other Person or for any other purpose without our prior
written consent.
Very truly yours,
SCHEDULE I
____________________, as Owner Participant
State Street Bank and Trust Company of Connecticut, National Association,
individually and as Indenture Trustee, Pass Through
Trustee and Subordination Agent
First Security Bank, National Association,
individually and as Owner Trustee
Standard & Poor's Ratings Services
55 Water Street
New York, New York 10041
Officer's Certificate to SASM&F (Illinois) Opinion
N_________
EXHIBIT A
Certificate
The undersigned, Howard L. Wu, is the Associate General Counsel of
US Airways, Inc., a Delaware corporation (the "Lessee"), and understands
that pursuant to certain of the Transaction Documents (as defined in the
Opinion referred to below), Skadden, Arps, Slate, Meagher & Flom (Illinois)
("SASM&F") is rendering an opinion dated the date hereof (the "Opinion") to
each of the Persons listed on Schedule I thereto. Capitalized terms used
herein but not otherwise defined shall have the meanings set forth in the
Opinion. The undersigned further understands that SASM&F is relying on
this officer's certificate and the statements made herein in rendering such
Opinion.
With regard to the foregoing, on behalf of the Lessee, the
undersigned certifies that:
1. Due inquiry has been made of all persons deemed necessary or
appropriate to verify or confirm the statements contained herein.
2. SASM&F may rely upon the representations and warranties that
the Lessee has made in each of the Transaction Documents to which it is a
party. The undersigned has made a careful review of the representations
and warranties of the Lessee contained in each of the Transaction Documents
and hereby confirms, to the best of his knowledge and belief, that such
representations and warranties are true, correct and complete on and as of
the date of this certificate.
3. Less than 25 percent of the assets of Lessee and its
subsidiaries on a consolidated basis and on an unconsolidated basis consist
of margin stock (as such term is defined in Regulation U of the Board of
Governors of the Federal Reserve System).
4. Lessee is engaged primarily, directly and through its wholly-
owned subsidiaries and its Majority-Owned Subsidiaries (as hereinafter
defined), in the airline transportation business and (i) is not and does
not hold itself out as being, engaged primarily nor does it propose to
engage primarily, in the business of investing, reinvesting or trading in
Securities (as hereinafter defined), (ii) has not and is not engaged in,
and does not propose to engage in, the business of issuing Face-Amount
Certificates of the Installment Type (as hereinafter defined) and has no
such certificate outstanding and (iii) is not engaged and does not propose
to engage in the business of investing, reinvesting, owning, holding or
trading in Securities, whether or not as its primary activity, and does not
own or propose to acquire Investment Securities (as hereinafter defined)
having a Value exceeding 40% of the Value of the total assets of the Lessee
(exclusive of Government Securities (as hereinafter defined)) on an
unconsolidated basis.
5. Neither the Lessee nor any of its subsidiaries or affiliates
owns or operates facilities that are used for the generation, transmission,
or distribution of electric energy for sale ("electric utility
facilities").
6. Neither the Lessee nor any of its subsidiaries or affiliates
owns or operates facilities that are used for the distribution at retail of
natural or manufactured gas for heat, light, or power ("gas utility
facilities").
7. Neither the Lessee nor any of its subsidiaries or affiliates,
directly or indirectly, or through one or more intermediary companies,
owns, controls or holds with power to vote (a) five percent (5%) or more of
the outstanding securities, such as notes, drafts, stock, treasury stock,
bonds, debentures, certificates of interest or participation in any profit
sharing agreements or in oil, gas, other mineral royalties or leases,
collateral-trust certificates, preorganization certificates or
subscriptions, transferable shares, investment contracts, voting-trust
certificates, certificate of deposit for a security, receiver's or
trustee's certificates, or any other instrument commonly known as a
"security" (including certificates of interest or participation in,
temporary or interim certificates for, receipt for, guaranty of, assumption
of liability on, or warrants or right to subscribe to or purchase any of
the foregoing) presently entitling it to vote in the direction or
management of, or any such instrument issued under or pursuant to any
trust, agreement, or arrangement whereby a trustee or trustees or agent or
agents for the owner or holder of such instrument is presently entitled to
vote in the direction or management of, any corporation, partnership,
association, joint-stock company, joint venture or trust that owns or
operates any electric utility facilities or gas utility facilities, or (b)
any other interest, directly or indirectly, or through one or more
intermediary entities, in any corporation, partnership, association,
joint-stock company, joint venture or trust that owns or operates any
electric utility facilities or gas utility facilities.
8. Neither the Lessee nor any of its subsidiaries or affiliates
has received notice that the Securities and Exchange Commission has
determined, or may determine, that the Lessee or any of its subsidiaries or
affiliates exercises a controlling influence over the management or
direction of the policies of a gas utility company or an electric utility
company as to make it subject to the obligations, duties and liabilities
imposed on holding companies by the Public Utility Holding Company Act of
1935, as amended.
9. As used in paragraph 4 of this certificate, the following terms
shall have the following meanings:
"Control" means the power to exercise a controlling influence over
the management or policies of a company, unless such power is solely the
result of an official position with such company;
"Face-Amount Certificate of the Installment Type" means any
certificate, investment contract, or other Security that represents an
obligation on the part of its issuer to pay a stated or determinable sum or
sums at a fixed or determinable date or dates more than 24 months after the
date of issuance, in consideration of the payment of periodic installments
of a stated or determinable amount;
"Government Securities" means all Securities issued or guaranteed
as to principal or interest by the United States, or by a person controlled
or supervised by and acting as an instrumentality of the government of the
United States pursuant to authority granted by the Congress of the United
States; or any certificate of deposit for any of the foregoing;
"Investment Securities" includes all Securities except (A)
Government Securities, (B) Securities issued by employees' securities
companies, and (C) Securities issued by Majority-Owned Subsidiaries of the
Lessee which are not engaged and do not propose to be engaged in activities
within the scope of clause (i), (ii) or (iii) of paragraph 4 of this
Certificate;
"Majority-Owned Subsidiary" of a person means a company 50% or more
of the outstanding Voting Securities of which are owned by such person, or
by a company which, within the meaning of this paragraph, is a Majority-
Owned Subsidiary of such person. Notwithstanding the foregoing, a company
shall not be considered a Majority-Owned Subsidiary of a person if Control
of such company rests with someone other than such person;
"Security" means any note, stock, treasury stock, bond, debenture,
evidence of indebtedness, certificate of interest or participation in any
profit-sharing agreement, collateral-trust certificate, preorganization
certificate or subscription, transferrable share, investment contract,
voting-trust certificate, certificate of deposit for a security, fractional
undivided interest in oil, gas, or other mineral rights, any put, call,
straddle, option, or privilege on any security (including a certificate of
deposit) or on any group or index of securities (including any interest
therein or based on the value thereof), or any put, call, straddle, option,
or privilege entered into on a national securities exchange relating to
foreign currency, or, in general, any interest or instrument commonly known
as a "security," or any certificate of interest or participation in,
temporary or interim certificate for, receipt for, guarantee of, or warrant
or right to subscribe to or purchase, any of the foregoing;
"Value" means (i) with respect to Securities owned at the end of
the last preceding fiscal quarter for which market quotations are readily
available, the market value at the end of such quarter; (ii) with respect
to other Securities and assets owned at the end of the last preceding
fiscal quarter, fair value at the end of such quarter, as determined in
good faith by or under the direction of the board of directors; and (iii)
with respect to securities and other assets acquired after the end of the
last preceding fiscal quarter, the cost thereof;
"Voting Security" means any security presently entitling the owner
or holder hereof to vote for the election of directors of a company.
IN WITNESS WHEREOF, the undersigned has executed this certificate
this ___ day of ______, 1999.
________________________________
Name: Howard L. Wu
Title: Associate General Counsel
[LETTERHEAD OF US AIRWAYS, INC.]
[LEASED AIRCRAFT OPINION]
------------, -----
To Each Person Listed
on Schedule I Hereto
Re: US Airways, Inc. Trust No. N____U_
Ladies and Gentlemen:
I am the _________________________ of US Airways, Inc., a Delaware
corporation ("US Airways"), and am familiar with the transactions
contemplated by the Participation Agreement (US Airways, Inc. Trust No.
N___U_), dated as of ________, ____ (the "Participation Agreement"), among
US Airways, as Lessee, __________________, as Owner Participant, State
Street Bank and Trust Company of Connecticut, a national banking
association, not in its individual capacity except as otherwise provided
therein but solely as Pass Through Trustee, Indenture Trustee and
Subordination Agent, and First Security Bank, National Association, a
national banking association, not in its individual capacity except as
otherwise provided therein, but solely as Owner Trustee, relating to the
Aircraft (as defined below). Capitalized terms not otherwise defined herein
have the meanings assigned thereto in Annex A to the Participation
Agreement.
This opinion is being delivered pursuant to Section 4(a)(xi) of the
Participation Agreement.
In my examination, I have assumed the genuineness of all signatures
(other than the signatures of US Airways), including endorsements, the
legal capacity of natural persons, the authenticity of all documents
submitted to me as originals, the conformity to original documents of all
copies submitted to me as telefacsimile, certified or photostatic copies,
and the authenticity of the originals of such copies. As to any facts
material to this opinion, I have relied solely upon statements,
representations and warranties of US Airways, the Owner Participant, the
Owner Trustee, the Indenture Trustee, the Subordination Agent, the Pass
Through Trustee and their respective officers and representatives, and
others in the Operative Documents and of public officials, and I have made
no independent investigation or inquiry with respect to such factual
matters.
In rendering the opinions set forth herein, I have examined and
relied on executed originals or copies of the following:
(a) the Participation Agreement;
(b) the Lease;
(c) the Lease Supplement;
(d) the Tax Indemnity Agreement;
(e) the Purchase Agreement Assignment;
(f) the Trust Indenture;
(g) the Trust Supplement;
(h) the Warranty Bill of Sale;
(i) the FAA Bill of Sale;
(j) the Acceptance Certificate;
(k) the Equipment Notes;
(l) the Pass Through Trust Agreement;
(m) each of the Pass Through Trust Agreement Supplements;
(n) certified copies of the Certificate of Incorporation and By-laws
of US Airways;
(o) certified copies of certain resolutions of the Board of Directors
of US Airways adopted on ___________;
(p) a certificate of good standing from the Secretary of State of the
State of Delaware as to the good standing of US Airways in such
jurisdiction; and
(q) such other documents as I have deemed necessary or appropriate as
a basis for the opinions set forth below.
Based on the foregoing, it is my opinion that:
1. US Airways is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, is a "citizen
of the United States" within the meaning of Section 40102(a)(15) of the
Transportation Code, and has or had, on the date of execution thereof, the
corporate power and authority to carry on its business as currently
conducted and to enter into and perform its obligations under each of the
Operative Documents to which it is a party. US Airways is duly qualified to
do business and is in good standing in the State of Virginia and each other
state of the United States in which its operations or the nature of its
business requires US Airways to so qualify, except where the failure to so
qualify would not have a material adverse effect on US Airways or its
business.
2. US Airways possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents which are material
to the operation of the routes flown by it and the conduct of its business
and operations as currently conducted, and each such certificate,
franchise, license, permit, right and concession and consent is in full
force and effect, except where any failure would not have a material
adverse effect on US Airways or its business.
3. Each of the Operative Documents to which US Airways is a party has
or had, on the date of execution thereof, been duly authorized, executed
and delivered by US Airways.
4. Neither the execution and delivery by US Airways of any of the
Operative Documents to which US Airways is a party, nor the consummation of
any of the transactions by US Airways contemplated thereby, nor the
performance of the obligations thereunder by US Airways, did at the time of
execution and delivery, or does presently (a) require any stockholder
approval or violate the certificate of incorporation or By-laws of US
Airways or (b) conflict with or contravene the provisions of, or constitute
a default under, or result in the creation of any Lien (other than any
Permitted Lien) upon the property of US Airways under any law, governmental
rule or regulation, or the charter or By-laws of US Airways or any order,
writ, injunction or decree of any court or governmental authority against
US Airways or by which any of its properties may be bound or any material
indenture, mortgage, contract or other agreement known to me to which US
Airways is a party or by which it may be bound, or require the approval or
consent of any trustee or the holders of any indebtedness or material
obligations of US Airways.
5. Neither the execution and delivery by US Airways of any of the
Operative Documents to which it is a party, nor the consummation of any
transactions by US Airways contemplated thereby, nor the performance of the
obligations thereunder by US Airways, did or does, as the case may be, (a)
require the consent or approval of, the giving of notice to, or (except as
described or contemplated in the Operative Documents, all of which were or
are required to be performed on or prior to the Delivery Date and which
were or shall have been accomplished on or prior to the Delivery Date) the
registration with, or the taking of any other action in respect of, the
FAA, the Securities and Exchange Commission or any other authority or
agency of the federal government or of the State of Virginia other than (i)
the registration of the issuance and sale of the Pass Through Certificates
under the Securities Act, (ii) compliance with the securities laws of each
applicable state, (iii) the registration in the Owner Trustee's name of the
Aircraft pursuant to the Transportation Code, and (iv) the filings and,
where appropriate, recording, pursuant to the Transportation Code, of each
of the FAA Bill of Sale, the Trust Agreement, the Lease (with the Lease
Supplement covering the Aircraft, the Trust Indenture and the Trust
Supplement covering the Aircraft attached as exhibits) and the Trust
Indenture (with the Trust Indenture and Trust Supplement covering the
Aircraft attached as an exhibit), or (b) contravene any judgment or order
applicable to or binding on US Airways or any law or governmental rule or
regulation of the United States or of the State of Virginia.
6. There is no pending or, to my knowledge, threatened action or
proceeding before any court or administrative agency which individually (or
in the aggregate in the case of any group of related lawsuits) (i) is
expected to have a material adverse effect on (A) the financial condition
of US Airways except for the matters described under "Legal Proceedings" in
US Airways' Annual Report on Form 10-K for the fiscal year ended December
31, 1998 and US Airways' Quarterly Report on Form 10-Q for the quarter
ended ______________, as to all of which I can express no opinion at this
time concerning US Airways' liability (if any) or the effect of any adverse
determination upon the business, condition (financial or otherwise) or
operations of US Airways, or (B) the ability of US Airways to perform its
obligations under the Operative Documents, or (ii) involves the Aircraft.
7. [Each of] US Airways [and Shuttle, Inc.] is a duly certificated
"air carrier" within the meaning of the Transportation Code, and [each of
US Airways and Shuttle, Inc. is] a holder of a certificate under Sections
41102(a) and 41103 of the Transportation Code, and an "air carrier
operating certificate" issued under Chapter 447 of the Transportation Code
for aircraft capable of carrying ten (10) or more individuals or 6,000
pounds or more of cargo, and each such certificate is in full force and
effect.
8. US Airways is not, and is not directly or indirectly controlled by
or acting on behalf of any Person which is, an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
[9. Shuttle, Inc. ("US Airways Shuttle") is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Delaware and is a "citizen of the United States" within the
meaning of Section 40102(a)(15) of the Transportation Code.
10. US Airways Shuttle is a duly certificated "air carrier" within
the meaning of the Transportation Code, and is a holder of a certificate
under Sections 41102(a) and 41103 of the Transportation Code, and an "air
carrier operating certificate" issued under Chapter 447 of the
Transportation Code for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, and each such certificate is
in full force and effect.](1)
I do not express any opinion as to matters governed by any law other
than the federal laws of the United States of America and the corporation
law of the State of Delaware.
This opinion is delivered to you solely for your use in connection
with the transaction described herein, and may not be used for any other
purpose, and may not be relied upon by any other person, without my prior
written consent.
Very truly yours,
- --------
(1) For transactions with Aircraft leased or subleased to US Airways
Shuttle only.
[FORM OF OPINION OF CLIFFORD CHANCE
REGARDING MANUFACTURER DOCUMENTS]
To: US Airways Inc.
US Airways Group, Inc.
First Security Bank, National Association
[ ]
RE: ONE AIRBUS [ ] AIRCRAFT
MANUFACTURER'S SERIAL NO. [ ]
US REGISTRATION NO. [ ]
Dear Sirs,
1. We have been requested by US Airways Inc. (the "COMPANY"), to act as
special French counsel with respect, and to render this opinion in
connection with certain of the transactions contemplated in a certain
Participation Agreement dated as of [ ] (the "PARTICIPATION
AGREEMENT") among [ ].
2. We have examined copies (which we assume conform to the originals) of:
(i) the purchase agreement assignment (Scheduled August, 1999
through April, 2000 Deliveries) dated as of August 1, [1999]
between US Airways Group, Inc. (as assignor) and the Company
(as assignee) (the "FIRST PURCHASE AGREEMENT ASSIGNMENT");
(ii) the consent and agreement of AVSA S.A.R.L. ("AVSA") and Airbus
Industrie G.I.E. ("AIRBUS") to the First Purchase Agreement
Assignment as acknowledged and accepted by US Airways Group,
Inc. and the Company dated as of August 1, [1999] (the "FIRST
CONSENT");
(iii) the purchase agreement assignment (US Airways, Inc. Trust
No. N [ ] U[ ]), dated as of [ ], between the Company
(as assignor) and First Security Bank, National Association
(not in its individual capacity but solely as owner trustee
(the "OWNER TRUSTEE") as assignee) (the "SECOND PURCHASE
AGREEMENT ASSIGNMENT");
(iv) the trust indenture and security agreement (US Airways, Inc.
Trust No. N[ ] U[ ]) dated as of [ ] between the Owner
Trustee and State Street Bank and Trust Company of Connecticut,
National Association as indenture trustee (the "INDENTURE
TRUSTEE") (the "TRUST INDENTURE AND SECURITY AGREEMENT");
(v) the consent and agreement of Airbus (to the Second Purchase
Agreement Assignment and the assignment named therein made under
the Trust Indenture and Security Agreement) dated as of [ ]
(the "AIRBUS CONSENT AND AGREEMENT");
(vi) the consent and agreement of AVSA (to the Second Purchase
Agreement Assignment and to the assignment named therein under
the Trust Indenture and Security Agreement) dated as of [ ]
(the "AVSA CONSENT AND AGREEMENT");
(vii) the pledge agreement dated [ ] made between the Owner Trustee
(as pledgor) and the Indenture Trustee (as pledgee, the "PLEDGE
AGREEMENT"),
the documents referred to in (i) to (vii) above are hereinafter
referred to collectively as the "DOCUMENTS", the documents referred to
in (i) and (iii) above are hereinafter referred to collectively as the
"ASSIGNMENTS" and the documents referred to in (v) and (vi) above are
hereinafter referred to collectively as the "SECOND CONSENTS".
3. In considering the above, we have assumed:
(i) that the Documents have been duly executed by the parties
thereto (other than Airbus and AVSA);
(ii) the genuineness of all signatures;
(iii) the completeness and conformity to the originals of all
documents supplied to us as copies or as facsimiles;
(iv) that the Documents expressed to be governed by New York law
constitute the legal, valid and binding obligations of the
parties thereto under New York law.
4. Having considered the Documents we are of the opinion, subject to the
qualifications and reservations set out in paragraph 5 below, that:
(i) Airbus is a groupement d'interet economique duly organised and
existing under the laws of the French Republic and has the power
and authority to carry on its business as now conducted. The
present members of Airbus are (i) Aerospatiale, Societe
Nationale Industrielle, (ii) DaimlerChrysler Aerospace Airbus
GmbH, (iii) British Aerospace (Operations) Ltd. and (iv)
Construcciones Aeronauticas S.A. and each of such corporations
is, without the need to proceed against any collateral security
for the indebtedness of Airbus or to take any other legal action
or process (except for service on Airbus by huissier of notice
to perform and subsequent failure by Airbus to do so), jointly
and severally liable with the other members for the debts of
Airbus arising out of obligations contracted by Airbus while
such corporation is a member of Airbus;
(ii) AVSA is a societe a responsabilite limitee duly established and
existing under the laws of the French Republic and has the power
and authority to carry on its business as now conducted;
(iii) each of Airbus and AVSA has full power and authority to enter
into and to execute, deliver and perform its obligations under
the Documents to which it is a party; such obligations are
legal, valid and binding upon them respectively, are enforceable
in accordance with their respective terms and rank pari passu
with the other unsecured obligations of Airbus and AVSA, as the
case may be;
(iv) assuming that under New York law the Indenture Trustee would be
entitled to take proceedings in its own name and on its own
account to recover from the Owner Trustee the full amount of all
amounts secured by the Pledge Agreement, the Pledge Agreement:
(a) duly creates for the benefit of the Indenture Trustee the
security interests which the Pledge Agreement purports to
create and the Indenture Trustee is entitled to the
benefits and security afforded thereby; and
(b) subject to the registration and huissier requirements of
paragraph 5(d) hereof and the observation set forth in
paragraph 5(f) hereof and with respect to non-monetary
claims, should be effective as against Airbus, AVSA and
third parties to perfect the pledge of the obligations of
Airbus and AVSA that are the subject of the Pledge
Agreement; and
(c) subject to the registration and huissier requirements of
paragraph 5(d) hereof and with respect to monetary claims,
would be effective as against Airbus, AVSA and third
parties to perfect the pledge of the obligations of Airbus
and AVSA that are the subject of the Pledge Agreement;
(v) the choice of the laws of the State of New York to govern the
Documents (which are expressed to be so governed) is valid under
the laws of the French Republic, and a French court would uphold
such choice of law in any suit on the Documents brought in a
French court.
5. This opinion must be read subject to the following qualifications and
observations as to French law:
(a) the remedy of specific performance may not be available in a
French court;
(b) in respect of payment obligations, a French court has power
under Article 1244-1 of the French Civil Code to grant time
to a debtor (not in excess of two years), taking into
account the position of the debtor and the needs of the
creditor;
(c) in order to ensure the validity as against third parties of
the assignments made in the Assignment Agreements, it is
necessary that notice of such assignments be served on
Airbus and AVSA by huissier in accordance with the
provisions of Article 1690 of the French Civil Code. We
have been instructed by the Company to assist in carrying
our such formalities which we intend to do upon receipt of
duly executed originals of the Assignment Agreements and we
anticipate that there will be no difficulty in accomplishing
these formalities;
(d) in order to ensure the validity as against third parties of
the pledge (nantissement) created by the Pledge Agreement in
accordance with the provisions of Article 2075 of the French
Civil Code, it is necessary for the Pledge Agreement to be
registered with the French tax administration in a form duly
translated in French by a sworn translator, involving
payment of a stamp duty of a nominal amount. In addition,
the nantissement created by the Pledge Agreement will need
to be served on each of the obligors by huissier, in
accordance with the provisions of Article 2075 of the French
Civil Code. We have been instructed by the Company to carry
out such formalities on its behalf which we intend to do
upon receipt of duly executed originals of the Pledge
Agreement and we anticipate that there will be no difficulty
in accomplishing these formalities;
(e) in the event of any proceedings being brought in a French
court in respect of a monetary obligation expressed to be
payable in a currency other than French Francs or euros, a
French court would probably give judgment expressed as an
order to pay, not such currency, but its French Franc or
euro equivalent at the time of payment or enforcement of
judgment. With respect to a bankruptcy, insolvency,
liquidation, moratorium, reorganization, reconstruction or
similar proceedings, French law may require that all claims
or debts be converted into French Francs or euros at an
exchange rate determined by the court at a date related
thereto, such as the date of commencement of a winding-up;
(f) pledges over non-monetary claims are unusual under French
law. In principal, pledges over claims of this type should
be effective against AVSA and third parties but in the
absence of case law, there is a lack of certainty about the
pledge being effective;
(g) a determination or certificate as to any matter provided for
in the Documents might be held by a French court not to be
final, conclusive or binding, if such determination or
certificate could be shown to have an unreasonable,
incorrect or arbitrary basis or not to have been given or
made in good faith;
(h) claims may become barred by effluxion of time or may be or
become subject to defense of set-off of counterclaim;
(i) a French court may stay proceedings if concurrent
proceedings are being brought elsewhere;
(j) we express no opinion as to whether any provision in the
documents conferring a right of set-off or similar right
would be effective against a liquidator or a creditor;
(k) the enforcement against Airbus of any of the Documents to
which it is a party may be limited by applicable bankruptcy,
insolvency, arrangement, moratorium or similar laws relating
to or affecting the enforcement of creditors' rights
generally, as such laws are applied to Airbus. The
enforcement against AVSA of any of the Documents to which it
is a party may be limited to such laws, as such laws are
applied to AVSA. The enforcement against any member of
Airbus of any obligation of Airbus contained in the
Documents may be limited to such laws, as such laws are
applied to such member;
(l) our opinion as to the enforceability of the Documents
relates only to their enforceability in France in
circumstances where the competent French court has and
accepts jurisdiction. The term "enforceability" refers to
the legal character of the obligations assumed by the
parties under the Documents, i.e., that they are of a
character which French law enforces or recognizes. It does
not mean that the Documents will be enforced in all
circumstances or in foreign, jurisdictions or by or against
third parties or that any particular remedy will be
available; and
(m) article 899 of the French Tax Code provides that agreement
evidencing an undertaking in pay a sum of money are subject
to stamp tax (droit de timbre) of a nominal amount if made
in the French Republic, if made in a foreign country, such
agreements are subject to a stamp tax of a nominal amount
before certain use thereof can be made in the French
Republic (Article 897 of the French Tax Code). However
non-payment of such stamp tax does not affect the legality,
validity or enforceability of the Documents.
We are qualified as French Avocats.
No opinion is expressed herein as to laws other than the laws of the French
Republic as of the date hereof. This opinion is for your use and that of
no one else, and is limited to (i) the matters specifically mentioned,
herein, and (ii) the purpose set out above.
Yours faithfully,
CLIFFORD CHANCE
FORM OF OPINION OF SPECIAL COUNSEL
TO THE OWNER TRUSTEE
TO EACH OF THE PARTIES SET FORTH
IN SCHEDULE A HERETO:
Re: US AIRWAYS, INC. LEVERAGED LEASE N_______
Dear Sir or Madam:
We have acted as special counsel for First Security Bank, National
Association, a national banking association, in its individual capacity
("First Security") and in its capacity as trustee (the "Owner Trustee")
under Trust Agreement dated as of _________, 1999,
(the "Trust Agreement") between it and ___________, as owner participant
(the "Owner Participant"), in connection with the transactions contemplated
by the Participation Agreement (as defined below). Except as otherwise
defined herein, the terms used herein shall have the meanings set forth in
Annex A to Participation Agreement _____, dated as of _______________, 1999
among US Airways, Inc., as Lessee, the Owner Participant, First Security,
not in its individual capacity except as provided therein, and as Owner
Trustee, and State Street Bank and Trust Company of Connecticut, National
Association, not in its individual capacity except as expressly provided
therein, but solely as Indenture Trustee, Subordination Agent and as Pass
Through Trustee under each of the Pass Through Trust Agreements (the
"Participation Agreement").
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of such documents, corporate records and other
instruments as we have deemed necessary or advisable for the purpose of
rendering this opinion.
Based upon the foregoing, we are of the opinion that:
1. First Security is a national banking association duly
organized, validly existing and in good standing under the laws of the
United States, is a "citizen of the United States" within the meaning
of Section 40102(a)(15) of the Act and has the full power and
authority to enter into and perform its obligations under the Trust
Agreement and each other Operative Agreement to which it, in its
individual capacity or as Owner Trustee, as the case may be, is a
party and, as Owner Trustee, to issue, execute, and deliver and
perform the Equipment Notes.
2. The Owner Trustee is the duly appointed trustee under the
Trust Agreement and the Trust Agreement creates a legal and valid
trust under the laws of the State of Utah; the trust created by the
Trust Agreement has been duly created and exists for the benefit of
the Owner Participant, and the Trust Agreement creates for the benefit
of the Owner Participant the rights and interests in the Trust Estate
which the Trust Agreement by its terms purports to create; and
assuming the Trust Agreement was properly authorized, executed and
delivered by the Owner Participant and that the terms of the Trust
Agreement are not in violation of any laws, documents, judgments,
regulations or other provisions applicable to the Owner Participant,
the Trust Agreement constitutes, under the laws of the State of Utah,
a legal, valid and binding obligation of the Owner Participant
enforceable against the Owner Participant in accordance with its
terms.
3. The Trust Agreement, the Participation Agreement, and each
other Operative Agreement to which First Security or the Owner
Trustee, as the case may be, is a party, and the Equipment Notes, have
been duly authorized, executed and delivered by First Security, or the
Owner Trustee, as the case may be, and assuming due authorization,
execution and delivery by the other parties thereto is a legal, valid
and binding obligation of First Security, or the Owner Trustee, as the
case may be, enforceable in accordance with their respective terms.
4. The execution and delivery by First Security of the Trust
Agreement and the Participation Agreement and the execution and
delivery by the Owner Trustee of the Operative Agreements to which it
is a party is not, and the performance by First Security, or the Owner
Trustee, as the case may be, of its respective obligations under each
such agreements will not be, inconsistent with the articles of
association or by-laws of First Security, do not and will not
contravene any federal law or law of the State of Utah, or any rule or
regulation of the State of Utah or the federal government, or any
judgment or order of which we have knowledge and which is applicable
to it and do not and will not contravene any provision of, or result
in the creation of any lien upon any property of First Security, or
constitute a default under, any indenture, mortgage, contract or other
instrument of which we have knowledge and to which First Security or
the Owner Trustee is a party or by which either is bound or require
the consent or approval of, the giving of notice to, or the
registration with, or the taking of any action in respect of, or under
federal law or the laws of the State of Utah or any subdivision or
agency thereof.
5. There are no fees, taxes or other charges, except taxes
imposed on fees payable to First Security, required to be paid under
the laws, ordinances or regulations of the State of Utah or any
political subdivision thereof, including, without limitation, Salt
Lake City, in connection with the execution, delivery or performance
by the Lessee, Owner Trustee, Mortgagee or any Participant of the
Operative Agreements solely because First Security, or the Owner
Trustee as the case may be, performs certain of its obligations under
the Operative Agreements in the State of Utah.
6. There are no pending or threatened actions or proceedings
against or affecting First Security or the Owner Trustee, as the case
may be, before any court, governmental authority or administrative
agency which, if adversely determined, could materially adversely
affect the right, power or ability, either in its individual capacity
or as Owner Trustee, or both, as the case may be, to enter into or
perform its obligations under the Operative Agreements.
7. The Trust Indenture (or financing statements or other
notices with respect thereto) has been filed for record or recorded
with the Division of Corporations and Commercial Code in the State of
Utah and such offices are all the places in the State of Utah wherein
such filing or recordation is necessary and no other actions or
filings are necessary in the State of Utah to perfect the lien and
security interest of the Mortgagee in the Trust Estate as against
creditors of or purchasers from the Owner Trustee or the Lessee, or
both.
8. The Owner Trustee has received such right, title and
interest in and to the Aircraft as was conveyed to the Owner Trustee
on the date hereof, subject to (i) the rights of the Lessee under the
Lease and the Lease Supplement; (ii) the beneficial interest of the
Owner Participant in the Aircraft; and (iii) the Lien created pursuant
to the Trust Indenture and the Trust Indenture Supplement; and to our
knowledge there exist no Liens affecting the right, title or interest
of the Owner Trustee in and to the Trust Estate resulting from claims
against First Security, not related to the ownership of the Trust
Estate or the administration of the Trust Estate or any other
transaction contemplated by the Operative Agreements.
9. Assuming that (i) the Aircraft is not physically located in
the State of Utah at the commencement or termination of the Term, (ii)
in connection with any sale or lease of the Aircraft, such Aircraft
will not be physically delivered in the State of Utah, and (iii) the
Aircraft will be sold or leased for use in interstate commerce, and
(iv) the trust created by the Trust Agreement is treated as a grantor
trust for federal income tax purposes in accordance with Sections 671
through 678 of the Internal Revenue Code of 1986, as amended, there
are no sales or transfer fees, taxes or other charges (except taxes
imposed on fees payable to the Owner Trustee) payable to the State of
Utah or any political subdivision thereof in connection with the
execution, delivery or performance by the Owner Trustee, the
Mortgagee, the Lessee or any Participant of the Operative Agreements
or in connection with the making by the Owner Participant of its
investment in the Aircraft or its acquisition of the beneficial
interest in the Trust Estate or in connection with the issuance and
acquisition of the Equipment Notes. Neither the Owner Trustee, the
Trust Estate nor the trust created by the Trust Agreement will be
subject to any fee, tax or other governmental charge (except taxes on
fees payable to the Owner Trustee) under the laws of the State of Utah
or any political subdivision thereof on, based on or measured by,
directly or indirectly, the gross receipts, net income or value of the
Trust Estate by reason of the creation or continued existence of the
trust under the terms of the Trust Agreement pursuant to the laws of
the State of Utah or the Owner Trustee's performance of its duties
under the Trust Agreement within such State.
10. Neither a Utah court nor a federal court applying Utah law
or federal law, if properly presented with the issue and after having
properly considered such issue, would permit the Owner Participant to
terminate the Trust Agreement, except in accordance with its terms.
11. Although there is no Utah case directly on point, under the
laws of the State of Utah, so long as the Trust Agreement has not been
terminated in accordance with its terms, creditors of any person that
is an Owner Participant, holders of a lien against the assets of any
such person that is an Owner Participant, such as trustees, receivers
or liquidators (whether or not an insolvency proceeding has been
commenced) (collectively the "Creditors") may acquire valid claims and
liens, as to the Trust Estate, only against the rights of such Owner
Participant under the Trust Agreement or in the Trust Estate, and do
not have, and may not through the enforcement of such Creditors'
rights acquire, any greater rights than such Owner Participant with
respect to the Trust Agreement or the Trust Estate.
The foregoing opinions are subject to the following assumptions, exception
and qualifications:
A. The foregoing opinions are limited to the laws of the State of
Utah and the federal laws of the United States of America governing
the banking and trust powers of First Security and Title II of the
United States Code entitled "Bankruptcy." In addition, we express no
opinion with respect to (i) federal securities laws, including the
Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, and the Trust Indenture Act of 1939, as amended;
(ii) the Federal Aviation Act of 1958, as amended (except with respect
to the opinion set forth in paragraph 1 above concerning the
citizenship of First Security); or (iii) state securities or blue sky
laws. Insofar as the foregoing opinions relate to the legality,
validity, binding effect and enforceability of the documents involved
in these transactions, which by their terms are governed by the laws
of a state other than Utah, we have assumed that such documents
constitute legal, valid, binding and enforceable agreements under the
laws of such state, as to which we express no opinion.
B. The foregoing opinions regarding enforceability of any document
or instrument are subject (i) except as otherwise set forth in the
opinions in paragraphs 10 and 11, to applicable bankruptcy,
insolvency, moratorium, reorganization, receivership and similar laws
affecting the rights and remedies of creditors generally, and (ii)
general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at law. We
call to your attention that bankruptcy courts are courts in equity
with wide discretion in applying the provisions of the Bankruptcy
Code.
C. As to the documents involved in these transactions, we have
assumed that each is a legal, valid and binding obligation of each
party thereto, other than First Security or the Owner Trustee, and is
enforceable against each such party in accordance with their
respective terms.
D. The opinion in paragraph 1 above concerning the citizenship of
First Security is based upon the facts contained in an affidavit of
First Security, made by its authorized officer, which facts we have
not independently verified.
E. We have assumed that all signatures, other than those of the
Owner Trustee or First Security, on documents and instruments involved
in these transactions are genuine, that all documents and instruments
submitted to us as originals are authentic, and that all documents and
instruments submitted to us conform with the originals, which facts we
have not independently verified.
F. We do not purport to be experts in respect of, or express any
opinion concerning laws, rules or regulations applicable to the
particular nature of the equipment involved in these transactions.
G. We have made no investigation of, and express no opinion
concerning, the nature of the title to any part of the equipment
involved in these transactions or the priority of any mortgage or
security interest.
H. We have assumed that the Participation Agreement and the
transactions contemplated thereby are not within the prohibitions of
Section 406 of the Employee Retirement Income Security Act of 1974.
I. In addition to any other limitation by operation of law upon the
scope, meaning or purpose of this opinion, this opinion speaks only as
of the date hereof. We have no obligation to advise the recipients of
this opinion (or any third party) of changes of law or fact that may
occur after the date hereof, even though the change may effect the
legal analysis, a legal conclusion or any information contained
herein.
J. The opinions expressed in this letter are solely for the use of
the parties which it is addressed in matters directly related to the
Participation Agreement and the transactions contemplated thereunder
and these opinions may not be relied on by any other persons or for
any other purpose without our prior written approval. The opinions
expressed in this letter are limited to the matters set forth in this
letter and no other opinions should be inferred beyond the matters
expressly stated.
Very truly yours,
RAY, QUINNEY & NEBEKER
SCHEDULE A
----------
First Security Bank, National Association
US Airways, Inc.
State Street Bank and Trust Company of Connecticut, National
Association
[Owner Participant]
Standard & Poor's Rating Service
Moody's Investors Service, Inc.
[AIG Matched Funding Corp.]
[OWNER PARTICIPANT SPECIAL COUNSEL OPINION]
--------------, ----
To the Persons Listed on
Schedule A Attached Hereto
Re: N___U__
Ladies and Gentlemen:
We have acted as special counsel to __________________, a
____________________ (the "Owner Participant") in connection with the
transactions contemplated by the Participation Agreement N___U_ dated as of
______________, ____ (the "Participation Agreement"), among US Airways, a
Delaware corporation, as Lessee; the Owner Participant; First Security
Bank, National Association, a national banking association, not in its
individual capacity except as expressly provided therein, but solely as
Owner Trustee; State Street Bank and Trust Company of Connecticut, National
Association , a national banking association, not in its individual
capacity except as expressly stated therein, but solely as Pass Through
Trustee. Capitalized terms used in this opinion and not defined herein
shall have the, respective meanings assigned thereto in Annex A to the
Participation Agreement. Our opinion is being delivered, at the request of
the Owner Participant, pursuant to Section 4(a)(xiv) of the Participation
Agreement.
In connection with the opinions contained herein, we have
examined executed counterparts of each of the Operative Documents. The
Operative Documents to which the Owner Participant is a party are herein
referred to as the "Owner Participant Documents".
For purposes of the opinions expressed below, we have
examined the originals or conformed copies of such corporate records and
documents, certificates and statements of public officials and such other
documents and records, and such other matters of law, as we have deemed
appropriate as a basis for the opinions hereinafter expressed. We have made
no independent inquiry or investigation of any factual matters or
circumstances relevant to the opinions contained herein, but instead we
have relied upon representations in the Operative Documents and upon
certificates and statements of the parties thereto and of public officials.
For the purposes of the opinions expressed below, we have
assumed (i) the authenticity of all documents submitted as originals; (ii)
the conformity to the originals of all documents submitted as certified or
photostatic copies and the authenticity of the originals; (iii) the legal
capacity of all natural persons who are parties to the Operative Documents;
(iv) the due authorization, execution and delivery of the Owner Participant
Documents by all parties; and (v) the legality, validity and binding effect
of the Owner Participant Documents as to, and the enforceability of the
same against, all parties (other than the Owner Participant).
Based upon the foregoing and such other information as we
have deemed necessary for purposes hereof, and subject to the assumptions,
qualifications and reliances set forth herein, we are of the opinion that:
1. Each of the Owner Participant Documents to which the
Owner Participant is a party constitutes a legal, valid and
binding obligation of the Owner Participant, enforceable against
the Owner Participant in accordance with their respective terms.
2. Neither the execution, delivery or performance by the
Owner Participant of the Owner Participant Documents to which the
Owner Participant is a party, the consummation by the Owner
Participant of any of the transactions contemplated thereby, nor
compliance by the Owner Participant with the provisions thereof
(a) violates any New York or federal laws, rules or regulations or
(b) requires the consent, permit, authorization or approval of,
the giving of notice to, the registration or filing with, or the
taking of any other action in respect of any governmental
authority or agency of the United States or the State of New York
(except for compliance with the requirements of the Federal
Aviation Act, as to which we express no opinion).
Our opinion as to the enforceability of any Owner
Participant Document is qualified by and subject to:
(i) limitations imposed by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, and laws relating to
fraudulent transfers or conveyances, preferences and equitable
subordination;
(ii) general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith
and fair dealing (regardless of whether enforcement is sought in a
proceeding in equity or at law);
(iii) the unenforceability under certain circumstances of
provisions purporting to release or exculpate any party from
liability for its acts or omissions, or purporting to impose a
duty upon any party to indemnify any other party when any claimed
damages result from the gross negligence or willful misconduct of
the party seeking such indemnity; and
(iv) the unenforceability under certain circumstances of
waivers, and provisions imposing liquidated damages, late payment
charges or forfeitures, if such amounts are determined to be
penalties in light of the actual damages incurred.
Anything in this opinion to the contrary notwithstanding,
we express no opinion concerning (i) the enforceability of any
indemnification agreements or of any waivers of the benefits of any
constitutional, statutory or common law rights contained in any of the
Operative Documents to the extent such enforceability may be barred or
limited by public policy considerations; (ii) federal and state applicable
laws relating to environmental matters or the offering of securities; (iii)
the Employee Retirement Income Security Act of 1974, as amended; (iv)
federal or state laws, rules or regulations governing banking or trust
powers; (v) the ownership of, or legal or equitable title to any property;
or (vi) the priority of any security interest contemplated by the Operative
Documents.
We are members of the bar of the State of New York and,
accordingly, we do not purport to express any opinion on any laws other
than the laws of the State of New York and the federal laws of the United
States of America, in each case as such laws are in effect on the date
hereof With respect to the Owner Participant Documents which by their terms
are to be governed by and construed in accordance with laws other than the
laws of the state of New York, we have assumed for purposes hereof that
such laws are identical in all respects to the laws of the state of New
York.
This opinion is furnished by us at your request for your
sole benefit and no one but an addressee (and any permitted transferee) is
entitled to rely on this opinion without our express written consent. This
opinion shall not be published or reproduced in any manner or distributed
or circulated to any person or entity without our express written consent.
Our opinion is limited to the matters stated herein, and no opinion is
implied or may be inferred beyond the matters expressly stated herein.
Very truly yours,
------------------------
SCHEDULE A
__________________, as Owner Participant
First Security Bank, National Association in its individual capacity and as
Owner Trustee
State Street Bank and Trust Company of Connecticut, National Association,
as Pass Through Trustee
US Airways, Inc., as Lessee
FORM OF OPINION OF CROWE & DUNLEVY
_____________, 1999
To the Addressees on the
Schedule Attached Hereto
Re: Airbus Industrie model A319-____ [A320____ or A330___] aircraft
with manufacturer's serial number __________ and United States
nationality and registration marks N________ (the "Aircraft")
---------------------------------------------------------------
Ladies and Gentlemen:
This letter confirms that we filed the following described
instruments with the Federal Aviation Administration (the "FAA") today at
the respective times noted below:
(a) AC Form 8050-2 Aircraft Bill of Sale dated __________
__, 1999 (the "FAA Bill of Sale") by US Airways, Inc. (the
"Lessee") to ____________, as Owner Trustee (the "Owner
Trustee") under Trust Agreement (US Airways, Inc. 1999-1 Series
N______) dated as of _________ __, 1999 (the "Trust Agreement")
between _______________ as Owner Participant and the Owner
Trustee, covering the Aircraft was filed at __:__.M., C._.T.;
(b) AC Form 8050-1 Aircraft Registration Application by the Owner
Trustee covering the Aircraft, to which were attached the
Affidavits required by Section 47.7(c)(2)(ii) of Part 47 of the
Federal Aviation Regulations, was filed at __:__.M., C._.T.;
(c) the Trust Agreement was filed at __:__.M., C._.T.;
(d) Trust Indenture and Security Agreement (US Airways, Inc. 1999-1
Series N_____) dated as of _______ __, 1999 (the "Indenture")
between the Owner Trustee and as Indenture Trustee (the
"Indenture Trustee"), to which was attached Trust Agreement and
Indenture Supplement No. 1 (US Airways, Inc. 1999-1 Series
N_____) dated ________ __, 1999 (the "Indenture Supplement")
covering the Aircraft and the model aircraft engines with
manufacturer's serial numbers and (the "Engines"), was filed at
__:__.M., C._.T.; and
(e) Lease Agreement dated as of _________ __, 1999 (the
"Lease") between the Owner Trustee as lessor and the Lessee, to
which were attached Lease Supplement No. 1 (US Airways,
Inc.1999-1 Series N____) dated __________ __, 1999 (the "Lease
Supplement") covering the Aircraft and the Engines, the
Indenture and the Indenture Supplement, was filed at __:__.M.,
C._.T.
Based upon our examination of the above described instruments
and of such records of the FAA as we deemed necessary to render this
opinion and as were made available to us by the FAA, it is our opinion
that:
(a) the FAA Bill of Sale, the Indenture with the Indenture
Supplement attached and the Lease with the Lease Supplement,
the Indenture and the Indenture Supplement attached are in due
form for recordation by and have been duly filed for
recordation with the FAA pursuant to and in accordance with the
provisions of Section 44107 of Title 49 of the United States
Code;
(b) legal title to the Aircraft is vested in the Owner
Trustee and all instruments necessary to cause the FAA in due
course to issue to the Owner Trustee an AC Form 8050-3
Certificate of Aircraft Registration covering the Aircraft have
been duly filed with the FAA pursuant to and in accordance with
the provisions of Sections 44102 and 44103 of Title 49 of the
United States Code;
(c) the Aircraft and the Engines are free and clear of Liens
(as such term is defined in Annex A to the Indenture and the
Lease) other than such as are created by the Indenture, as
supplemented by the Indenture Supplement, and by the Lease, as
supplemented by the Lease Supplement;
(d) the Indenture, as supplemented by the Indenture
Supplement, creates a duly and validly perfected first priority
security interest in favor of the Indenture Trustee in the
Aircraft and the Engines and in all of the right, title and
interest of the Owner Trustee in and to the Lease, as
supplemented by the Lease Supplement (insofar as such security
interest affects an interest covered by the recording system
established by the FAA pursuant to Section 44107 of Title 49 of
the United States Code);
(e) the rights of the Owner Trustee and the Lessee under the Lease,
as supplemented by the Lease Supplement, with respect to the
Aircraft and the Engines are perfected;
(f) the Indenture, as supplemented by the Indenture
Supplement, is not required to be refiled with the FAA or filed
or recorded in any other place within the United States in
order to perfect or maintain the perfection of the security
interest created thereby in the Aircraft and the Engines under
the applicable laws of any jurisdiction within the United
States;
(g) no other registration of the Aircraft and no filings or
recordings (other than the filings and recordings with the FAA
which have been effected) are necessary to perfect in any
jurisdiction within the United States the Owner Trustee's title
to the Aircraft or the security interest created by the
Indenture, as supplemented by the Indenture Supplement, in the
Aircraft and the Engines under the applicable laws of any
jurisdiction within the United States; and
(h) no authorization, approval, consent, license or order
of, or registration with, or giving of notice to, the FAA
Aircraft Registry is required for the valid authorization,
delivery or performance of the Lease, the Lease Supplement, the
Trust Agreement, the Indenture and the Indenture Supplement
except for such authorizations, approvals, consents, licenses,
orders, registrations and notices as have been effected.
No opinion is herein expressed as to; (i) laws other than the
federal laws of the United States; (ii) the validity or enforceability
under local law of the Indenture, as supplemented by the Indenture
Supplement; (iii) the recognition of the perfection of the security
interest created by the Indenture, as supplemented by the Indenture
Supplement, as against third parties in any legal proceedings outside the
United States; and (iv) the record status of the Aircraft prior to the
commencement of its United States registration. Since our examination was
limited to records maintained by the FAA Aircraft Registry, our opinion
does not cover liens which are perfected without the filing of notice
thereof with the FAA, such as federal tax liens, liens arising under
Section 1368(a) of Title 29 of the United States Code and possessory
artisans' liens, and was subject to the accuracy of FAA personnel in the
filing, indexing and recording of instruments filed with the FAA and in the
search for encumbrance cross-reference index cards for the Engines. This
opinion is rendered in reliance upon the opinion of the Aeronautical Center
Counsel dated _________ __, 1999 (a copy of which is attached hereto) and
upon the past practice of the FAA which is consistent with said opinion.
Very truly Yours,
ROBIN D. JENSON
For the Firm
SCHEDULE
___________________________ as Owner Trustee
___________________________ as Indenture Trustee, Pass Through
Trustee and Subordination Agent
US Airways, Inc.
Standard & Poor's Ratings Services
FORM OF OPINION OF BINGHAM DANA, SPECIAL COUNSEL
TO THE INDENTURE TRUSTEE
-------------, ------
TO THE PARTIES SET FORTH
IN SCHEDULE A HERETO
RE: US Airways, Inc./Secured Financing of One Airbus [A320] [A330-300]
Aircraft [N _____ US] - Indenture Trustee, Owned Aircraft
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity
("STATE STREET") and as Indenture Trustee (the "INDENTURE TRUSTEE") under
the Trust Indenture and Security Agreement [N ____ US] dated as of
[________________] (the "INDENTURE") between US Airways, Inc., and State
Street, as Indenture Trustee, in connection with the execution and delivery
of the Participation Agreement [N ____ US] dated as of [________________]
(the "PARTICIPATION AGREEMENT") by and among the Indenture Trustee, US
Airways, Inc., State Street, as Pass Through Trustee (the "PASS THROUGH
TRUSTEE"), State Street, as Subordination Agent (the "SUBORDINATION AGENT")
and the Owner Trustee and the transactions contemplated thereby.
Capitalized terms not otherwise defined herein shall have the meanings
specified in the Lease and Annex A of the Participation Agreement. This
opinion is being delivered pursuant to Section 4( )( ) of the Participation
Agreement.
Our representation of State Street and the Indenture Trustee has been
as special counsel for the limited purposes stated above. As to all matters
of fact (including factual conclusions and characterizations and
descriptions of purpose, intention or other state of mind), we have relied,
with your permission, entirely upon (i) the representations and warranties
of the parties set forth in the Operative Documents and (ii) certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations, warranties and
certificates.
We have examined the Participation Agreement and the Indenture (the
"OPERATIVE DOCUMENTS"), the Certificate of the Comptroller of the Currency
relating to State Street and originals, or copies certified or otherwise
identified to our satisfaction, of such other records, documents,
certificates, or other instruments as we have deemed necessary or advisable
for the purposes of this opinion. For purposes of our opinion rendered in
paragraph 1 below, with respect to the authority of State Street to operate
as a state-chartered trust company and exercise trust powers, our opinion
relies upon and is limited by such Certificate of the Comptroller of the
Currency.
We have assumed the genuineness of all signatures (other than those
on behalf of State Street and the Indenture Trustee), the conformity to the
originals of all documents reviewed by us as copies, and the authenticity
and completeness of all original documents reviewed by us in original or
copy form and the legal competence of each individual executing any
document (other than on behalf of State Street and the Indenture Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we
are aware or which are known to us, or with another similar qualification,
the relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion,
the individual lawyers in the firm who have participated directly in the
specific transactions to which this opinion relates and the partner of the
firm responsible for State Street corporate trust matters, and without any
special or additional investigation undertaken for the purposes of this
opinion.
Subject to the limitation set forth below, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions set forth below are limited solely to the internal
substantive laws of the State of Connecticut as applied by courts located
in Connecticut and the federal laws of the United States. No opinion is
given herein as to the choice of law or internal substantive rules of law
that any court or other tribunal may apply to the transactions contemplated
by the Operative Documents. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
no opinion is expressed as to matters governed by any law, statute, rule or
regulation of the United States relating to the acquisition, ownership,
registration, use, operation, maintenance, repair, replacement or sale of
or the nature of the Aircraft.
To the extent to which this opinion deals with matters governed by or
relating to the laws of the State of New York, or other jurisdiction other
than the State of Connecticut, by which the Operative Documents are stated
to be governed, we have assumed, with your permission that the Operative
Documents are governed by the internal substantive laws of the State of
Connecticut.
Our opinion is further subject to the following exceptions,
qualifications and assumptions:
(a) We have assumed without any independent investigation that
(i) each party to the Operative Documents, other than State Street, in its
individual capacity or as Indenture Trustee, as applicable, at all times
relevant thereto, is validly existing and in good standing under the laws
of the jurisdiction in which it is organized, and is qualified to do
business and in good standing under the laws of each jurisdiction where
such qualification is required generally or necessary in order for such
party to enforce its rights under such Operative Documents, and (ii) each
party to the Operative Documents, at all times relevant thereto, had and
has the full power, authority and legal right under its certificate of
incorporation, partnership agreement, by-laws, and other governing
organizational documents, and the applicable corporate, partnership, or
other enterprise legislation and other applicable laws, as the case may be
(other than State Street and the Indenture Trustee with respect to the laws
of the United States of America and the internal substantive laws of the
State of the Connecticut, but only in each case to the limited extent the
same may be applicable to State Street or the Indenture Trustee, and
relevant to our opinions expressed below) to execute, and to perform its
obligations under, the Operative Documents, and (iii) each party to the
Operative Documents (other than State Street or the Indenture Trustee, as
applicable) has duly executed and delivered each of such agreements and
instruments to which it is a party and that (other than with respect to
State Street and the Indenture Trustee, as applicable) the execution and
delivery of such agreements and instruments and the transactions
contemplated thereby have been duly authorized by proper corporate or other
organizational proceedings as to such party.
(b) We have assumed without any independent investigation (i)
that each of the Operative Documents is a valid, binding and enforceable
obligation of each party thereto other than State Street or the Indenture
Trustee, as applicable, and (ii) that each of the Operative Documents is a
valid, binding and enforceable obligation of State Street or the Indenture
Trustee, as applicable, to the extent that laws other than those of the
State of Connecticut are relevant thereto (other than the laws of the
United States of America, but only to the limited extent the same may be
applicable to State Street or the Indenture Trustee, as applicable, and
relevant to our opinions expressed below).
(c) The enforcement of any obligations of State Street or the
Indenture Trustee, as applicable, under any of the Operative Documents may
be limited by the receivership, conservatorship and supervisory powers of
bank regulatory agencies generally, as well as by bankruptcy, insolvency,
reorganization, moratorium, marshaling or other laws and rules of law
affecting the enforcement generally of creditors' rights and remedies
(including such as may deny giving effect to waivers of debtors' or
guarantors' rights); and we express no opinion as to the status under any
fraudulent conveyance laws or fraudulent transfer laws of any of the
obligations of State Street or the Indenture Trustee, as applicable, under
any of the Operative Documents.
(d) We express no opinion as the availability of any specific
or equitable relief of any kind.
(e) The enforcement of any of your rights may in all cases be
subject to an implied duty of good faith and fair dealing and to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity) and, as to any of your
rights to collateral security, will be subject to a duty to act in a
commercially reasonable manner.
(f) We express no opinion as to the enforceability of any
particular provision of any of the Operative Documents relating to (i)
waivers of rights to object to jurisdiction or venue, or consents to
jurisdiction or venue, (ii) waivers of rights to (or methods of) service of
process, or rights to trial by jury, or other rights or benefits bestowed
by operation of law, (iii) waivers of any applicable defenses, setoffs,
recoupments, or counterclaims, (iv) the grant of powers of attorney to any
person or entity, (v) exculpation or exoneration clauses, indemnity
clauses, and clauses relating to releases or waivers of unmatured claims or
rights, (vi) the imposition or collection of interest on overdue interest
or providing for a penalty rate of interest or late charges on overdue or
defaulted obligations, or the payment of any premium, liquidated damages,
or other amount which may be held by any court to be a "penalty" or a
"forfeiture," or (vii) so-called "usury savings clauses" purporting to
specify methods of (or otherwise assure) compliance with usury laws or
other similar laws of any jurisdiction.
(g) We express no opinion as to the effect of events occurring,
circumstances arising, or changes of law becoming effective or occurring,
after the date hereof on the matters addressed in this opinion letter, and
we assume no responsibility to inform you of additional or changed facts,
or changes in law, of which we may become aware.
(h) No opinion is given herein as to the effect of usury laws
(or other similar laws) of any jurisdiction with respect to the Operative
Documents.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their successors and assigns in connection
with the transactions contemplated by the Operative Documents and may not
be used or relied upon by any other person or for any other
purpose.
1. State Street is a national banking association, validly formed and
authorized to operate as a national banking association under the laws of
the United States of America and, in its individual capacity or as
Indenture Trustee, as the case may be, has the requisite corporate and
trust power and authority to execute, deliver and perform its obligations
under the Operative Documents and in its capacity as Indenture Trustee, to
authenticate the Equipment Notes issued on the date hereof.
2. State Street, in its individual capacity or as Indenture Trustee,
as the case may be, has duly authorized the Operative Documents by all
necessary corporate or trust action and has duly executed and delivered the
Operative Documents, and the Operative Documents constitute valid and
binding obligations of State Street, in its individual capacity or as
Indenture Trustee, as the case may be, enforceable against State Street, in
its individual capacity or as Indenture Trustee, as the case may be, in
accordance with their respective terms.
3. The Equipment Notes issued as of the date hereof have been duly
authenticated and delivered by State Street as Indenture Trustee pursuant
to the terms of the Indenture.
4. The authorization, execution, delivery and performance by State
Street, in its individual capacity or as Indenture Trustee, as the case may
be, of the Operative Documents and the consummation of the transactions
therein contemplated and compliance with the terms thereof do not and will
not result in the violation of the provisions of the charter documents or
by-laws of State Street and, to the best of our knowledge, do not conflict
with, or result in a breach of any terms or provisions of, or constitute a
default under, or result in the creation or the imposition of any lien,
charge or encumbrance upon any property or assets of State Street under any
indenture, mortgage or other agreement or instrument, in each case known to
us, to which State Street is a party or by which it is bound, or violates
any applicable Connecticut or federal law, rule or regulation governing
State Street's banking or trust powers, or, to the best of our knowledge,
of any judgment, order or decree, in each case known to us, applicable to
State Street of any court, regulatory body, administrative agency,
government or governmental body having jurisdiction over State Street.
5. No authorization, approval, consent, license or order of, giving
of notice to, registration with, or taking of any other action in respect
of, any federal or state governmental authority or agency pursuant to any
federal or Connecticut law governing the banking or trust powers of State
Street is required for the authorization, execution, delivery and
performance by State Street, in its individual capacity or as Indenture
Trustee, as the case may be, of the Operative Documents or the consummation
of any of the transactions by State Street, in its individual capacity or
as Indenture Trustee, as the case may be, contemplated thereby (except as
shall have been duly obtained, given or taken); and such authorization,
execution, delivery, performance, consummation and issuance do not conflict
with or result in a breach of the provisions of any such law.
6. There are no taxes, fees or other governmental charges payable
under the laws of the State of Connecticut or any political subdivision of
such State in connection with the execution and delivery by State Street,
in its individual capacity or as Indenture Trustee, as the case may be, of
the Operative Documents (except for taxes on any fees payable to State
Street in its individual capacity) which are imposed solely because State
Street has its principal place of business in Connecticut or performs its
administrative duties under the Operative Documents in Connecticut.
7. To our knowledge, but without having investigated any governmental
records or court dockets, and without having made any other independent
investigation, there are no proceedings pending or overtly threatened in
writing against or affecting State Street in any court or before any
governmental authority, agency, arbitration board or tribunal which, if
adversely determined, individually or in the aggregate, could reasonably be
expected to affect materially and adversely the trust related to the
Indenture or affect the right, power and authority of State Street, in its
individual capacity or as Indenture Trustee, as the case may be, to enter
into or perform its obligations under the Operative Documents.
Very truly yours,
BINGHAM DANA LLP
SCHEDULE A
----------
State Street Bank and Trust Company of
Connecticut, National Association
US Airways, Inc.
US Airways Group, Inc.
Standard & Poor's Ratings Service
Moody's Investors Service, Inc.
Credit Suisse First Boston Corporation
FORM OF OPINION OF BINGHAM DANA, SPECIAL COUNSEL TO THE PASS
THROUGH TRUSTEE
-------------------- --, ----
TO THE PARTIES SET FORTH
IN SCHEDULE A HERETO
RE: US Airways, Inc./Leveraged Lease Financing of One Airbus
[A320] [A300-300] Aircraft [N _________ US] - Pass
Through Trust
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity
("STATE STREET") and as Pass Through Trustee (the "PASS THROUGH TRUSTEE")
under the Pass Through Trust Agreement dated as of June __, 1999, among US
Airways Group, Inc., US Airways, Inc. and State Street, as supplemented by
Trust Supplement No. [ ], Trust Supplement No. [ ]and Trust Supplement No.
[ ], each dated as of [ ] and each among US Airways Group, Inc., US
Airways, Inc. and State Street (collectively, the "PASS THROUGH TRUSTS"
and, individually, a "PASS THROUGH TRUST") in connection with the execution
and delivery of the Participation Agreement [N ] dated as of [ ] (the
"PARTICIPATION AGREEMENT") by and among State Street, as Indenture Trustee,
US Airways, Inc., as Lessee (the "LESSEE"), [ ], as Owner Participant,
State Street, as Pass Through Trustee, State Street, as Subordination Agent
(the "SUBORDINATION AGENT") and First Security Bank, National Association,
as Owner Trustee and the transactions contemplated thereby. Capitalized
terms not otherwise defined herein shall have the meanings specified in the
Lease and Annex A of the Participation Agreement. This opinion is being
delivered pursuant to Section 4(a)(xxiii) of the Participation Agreement.
Our representation of State Street and the Pass Through Trustee has
been as special counsel for the limited purposes stated above. As to all
matters of fact (including factual conclusions and characterizations and
descriptions of purpose, intention or other state of mind), we have relied,
with your permission, entirely upon (i) the representations and warranties
of the parties set forth in the Operative Documents and (ii) certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations, warranties and
certificates.
We have examined the Participation Agreement, the Liquidity Facility
for each of the Class A, Class B and Class C Trusts, the Intercreditor
Agreement, the Note Purchase Agreement, the Escrow and Paying Agent
Agreement for each of the Class A, Class B and Class C Trusts each dated as
of ______________ __, ____ and each among First Security Bank, National
Association, as Escrow Agent, the underwriters named therein, State Street,
as Pass Through Trustee and State Street, as Paying Agent, and each of the
Pass Through Trusts (the "OPERATIVE DOCUMENTS"), the Certificate of the
Comptroller of the Currency relating to State Street and originals, or
copies certified or otherwise identified to our satisfaction, of such other
records, documents, certificates, or other instruments as we have deemed
necessary or advisable for the purposes of this opinion. For purposes of
our opinion rendered in paragraph 1 below, with respect to the authority of
State Street to operate as a national banking association and exercise
trust powers, our opinion relies upon and is limited by such Certificate of
the Comptroller of the Currency.
We have assumed the genuineness of all signatures (other than those
on behalf of State Street and the Pass Through Trustee), the conformity to
the originals of all documents reviewed by us as copies, and the
authenticity and completeness of all original documents reviewed by us in
original or copy form and the legal competence of each individual executing
any document (other than on behalf of State Street and the Pass Through
Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we
are aware or which are known to us, or with another similar qualification,
the relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion,
the individual lawyers in the firm who have participated directly in the
specific transactions to which this opinion relates and the partner of the
firm responsible for State Street corporate trust matters, and without any
special or additional investigation undertaken for the purposes of this
opinion.
Subject to the limitation set forth below, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions set forth below are limited solely to the internal
substantive laws of the State of Connecticut as applied by courts located
in Connecticut and the federal laws of the United States. No opinion is
given herein as to the choice of law or internal substantive rules of law
that any court or other tribunal may apply to the transactions contemplated
by the Operative Documents. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
no opinion is expressed as to matters governed by any law, statute, rule or
regulation of the United States relating to the acquisition, ownership,
registration, use, operation, maintenance, repair, replacement or sale of
or the nature of the Aircraft.
To the extent to which this opinion deals with matters governed by or
relating to the laws of the State of New York, or other jurisdiction other
than the State of Connecticut, by which the Operative Documents are stated
to be governed, we have assumed, with your permission that the Operative
Documents are governed by the internal substantive laws of the State of
Connecticut.
Our opinion is further subject to the following exceptions,
qualifications and assumptions:
I. We have assumed without any independent investigation
that (i) each party to the Operative Documents, other than
State Street, in its individual capacity or as Pass Through
Trustee, as applicable, at all times relevant thereto, is
validly existing and in good standing under the laws of the
jurisdiction in which it is organized, and is qualified to do
business and in good standing under the laws of each
jurisdiction where such qualification is required generally or
necessary in order for such party to enforce its rights under
such Operative Documents, and (ii) each party to the Operative
Documents, at all times relevant thereto, had and has the full
power, authority and legal right under its certificate of
incorporation, partnership agreement, by-laws, and other
governing organizational documents, and the applicable
corporate, partnership, or other enterprise legislation and
other applicable laws, as the case may be (other than State
Street and the Pass Through Trustee with respect to the laws of
the United States of America and the internal substantive laws
of the State of Connecticut, but only in each case to the
limited extent the same may be applicable to State Street or
the Pass Through Trustee, and relevant to our opinions
expressed below) to execute, and to perform its obligations
under, the Operative Documents, and (iii) each party to the
Operative Documents (other than State Street or the Pass
Through Trustee, as applicable) has duly executed and delivered
each of such agreements and instruments to which it is a party
and that (other than with respect to State Street and the Pass
Through Trustee, as applicable) the execution and delivery of
such agreements and instruments and the transactions
contemplated thereby have been duly authorized by proper
corporate or other organizational proceedings as to such party.
II. We have assumed without any independent investigation (i)
that each of the Operative Documents is a valid, binding and
enforceable obligation of each party thereto other than State
Street or the Pass Through Trustee, as applicable, and (ii)
that each of the Operative Documents is a valid, binding and
enforceable obligation of State Street or the Pass Through
Trustee, as applicable, to the extent that laws other than
those of the State of Connecticut are relevant thereto (other
than the laws of the United States of America, but only to the
limited extent the same may be applicable to State Street or
the Pass Through Trustee, as applicable, and relevant to our
opinions expressed below).
III. The enforcement of any obligations of State Street
or the Pass Through Trustee, as applicable, under any of the
Operative Documents may be limited by the receivership,
conservatorship and supervisory powers of bank regulatory
agencies generally, as well as by bankruptcy, insolvency,
reorganization, moratorium, marshaling or other laws and rules
of law affecting the enforcement generally of creditors' rights
and remedies (including such as may deny giving effect to
waivers of debtors' or guarantors' rights); and we express no
opinion as to the status under any fraudulent conveyance laws
or fraudulent transfer laws of any of the obligations of State
Street or the Pass Through Trustee, as applicable, under any of
the Operative Documents.
IV. We express no opinion as the availability of any
specific or equitable relief of any kind.
V. The enforcement of any of your rights may in all cases be
subject to an implied duty of good faith and fair dealing and
to general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in
equity) and, as to any of your rights to collateral security,
will be subject to a duty to act in a commercially reasonable
manner.
VI. We express no opinion as to the enforceability of any
particular provision of any of the Operative Documents relating
to (i) waivers of rights to object to jurisdiction or venue, or
consents to jurisdiction or venue, (ii) waivers of rights to
(or methods of) service of process, or rights to trial by jury,
or other rights or benefits bestowed by operation of law, (iii)
waivers of any applicable defenses, setoffs, recoupments, or
counterclaims, (iv) the grant of powers of attorney to any
person or entity, (v) exculpation or exoneration clauses,
indemnity clauses, and clauses relating to releases or waivers
of unmatured claims or rights, (vi) the imposition or
collection of interest on overdue interest or providing for a
penalty rate of interest or late charges on overdue or
defaulted obligations, or the payment of any premium,
liquidated damages, or other amount which may be held by any
court to be a "penalty" or a "forfeiture," or (vii) so-called
"usury savings clauses" purporting to specify methods of (or
otherwise assure) compliance with usury laws or other similar
laws of any jurisdiction.
VII. We express no opinion as to the effect of events
occurring, circumstances arising, or changes of law becoming
effective or occurring, after the date hereof on the matters
addressed in this opinion letter, and we assume no
responsibility to inform you of additional or changed facts, or
changes in law, of which we may become aware.
VIII. No opinion is given herein as to the effect of
usury laws (or other similar laws) of any jurisdiction with
respect to the Operative Documents.
In rendering the opinion set forth below in paragraph 6 as to certain
Connecticut tax matters, we have assumed that, for federal income tax
purposes, the trust created by the Trust Agreement will not be taxable as a
corporation, but, rather, will be classified as a grantor trust under
subpart E, Part I of Subchapter J of Chapter 1 of Subtitle A of the
Internal Revenue Code of 1986, as amended or as a partnership.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their successors and assigns in connection
with the transactions contemplated by the Operative Documents and may not
be used or relied upon by any other person or for any other purpose.
1. State Street is a national banking association, validly formed and
authorized to operate as a national banking association under the laws of
the United States of America and, in its individual capacity or as Pass
Through Trustee, as the case may be, has or had, as the case may be, the
requisite corporate and trust power and authority to execute, deliver and
perform its obligations under the Operative Documents and in its capacity
as Pass Through Trustee, to issue and execute the Pass Through Certificates
delivered on the Pass Through Trust Closing Date.
2. State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, has duly authorized by all necessary corporate
or trust action the Operative Documents and has duly executed and delivered
the Operative Documents, and the Operative Documents constitute valid and
binding obligations of State Street, in its individual capacity or as Pass
Through Trustee, as the case may be, enforceable against State Street, in
its individual capacity or as Pass Through Trustee, as the case may be, in
accordance with their respective terms.
3. The Pass Through Certificates issued and dated on the Pass Through
Trust Closing Date have been duly issued, authenticated and delivered by
State Street as Pass Through Trustee pursuant to the terms of the Operative
Documents and are enforceable against the Pass Through Trustee and are
entitled to the benefits of the applicable Pass Through Trusts.
4. The authorization, execution, delivery and performance by State
Street, in its individual capacity or as Pass Through Trustee, as the case
may be, of the Operative Documents and the consummation of the transactions
therein contemplated and compliance with the terms thereof do not and will
not result in the violation of the provisions of the charter documents or
by-laws of State Street and, to the best of our knowledge, do not conflict
with, or result in a breach of any terms or provisions of, or constitute a
default under, or result in the creation or the imposition of any lien,
charge or encumbrance upon any property or assets of State Street under any
indenture, mortgage or other agreement or instrument, in each case known to
us, to which State Street is a party or by which it is bound, or violates
any applicable Connecticut or federal law, rule or regulation governing
State Street's banking or trust powers, or, to the best of our knowledge,
of any judgment, order or decree, in each case known to us, applicable to
State Street of any court, regulatory body, administrative agency,
government or governmental body having jurisdiction over State Street.
5. No authorization, approval, consent, license or order of, giving
of notice to, registration with, or taking of any other action in respect
of, any federal or state governmental authority or agency pursuant to any
federal or Connecticut law governing the banking or trust powers of State
Street is required for the authorization, execution, delivery and
performance by State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, of the Operative Documents or the consummation
of any of the transactions by State Street, in its individual capacity or
as Pass Through Trustee, as the case may be, contemplated thereby (except
as shall have been duly obtained, given or taken); and such authorization,
execution, delivery, performance, consummation and issuance do not conflict
with or result in a breach of the provisions of any such law.
6. There are no taxes, fees or other governmental charges payable
under the laws of the State of Connecticut or any political subdivision of
such State in connection with the execution and delivery by State Street,
in its individual capacity or as Pass Through Trustee, as the case may be,
of the Operative Documents (except for taxes on any fees payable to State
Street in its individual capacity) or in connection with the issuance,
execution and delivery of the Pass Through Certificates by State Street, as
Pass Through Trustee, pursuant to the Pass Through Trusts which are imposed
solely because State Street has its principal place of business in
Connecticut or performs its administrative duties under the Operative
Documents in Connecticut. Neither State Street, in its individual capacity
or as the Pass Through Trustee, as the case may be, the Indenture Trustee,
the Owner Participant, the Owner Trustee, nor the trust created by the
Trust Agreement will, as a result of the transactions contemplated thereby,
be subject to any Taxes under the laws of the State of Connecticut or any
political subdivision thereof (except for Taxes on any fees payable to
State Street in its individual capacity) which are imposed because State
Street has its principal place of business in Connecticut or performs its
administrative duties under the Operative Documents in Connecticut, and
there are no Taxes under the laws of the State of Connecticut or any
political subdivision thereof (except for Taxes on any fees payable to
State Street in its individual capacity) upon or with respect to the
Aircraft or any Engine or any part of any interest therein, or the
purchase, ownership, delivery, lease, sublease, possession, presence, use,
operation, condition, storage, maintenance, modification, alteration,
repair, sale, return, transfer or other disposition of the Aircraft or any
Engine which are imposed because State Street has its principal place of
business in Connecticut or performs its administrative duties under the
Operative Documents in Connecticut.
7. To our knowledge, but without having investigated any governmental
records or court dockets, and without having made any other independent
investigation, there are no proceedings pending or overtly threatened in
writing against or affecting State Street in any court or before any
governmental authority, agency, arbitration board or tribunal which, if
adversely determined, individually or in the aggregate, could reasonably be
expected to affect materially and adversely the trust related to the
Indenture or affect the right, power and authority of State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, to
enter into or perform its obligations under the Operative Documents.
Very truly yours,
BINGHAM DANA LLP
SCHEDULE A
----------
State Street Bank and Trust Company of
Connecticut, National Association
First Security Bank, National Association
______________________, as Owner Participant
US Airways, Inc.
US Airways Group, Inc.
Standard & Poor's Ratings Service
Moody's Investors Service, Inc.
Credit Suisse First Boston Corporation
- -------------------------
- -------------------------
FORM OF OPINION OF BINGHAM DANA, SPECIAL COUNSEL TO THE SUBORDINATION AGENT
- -------------, --------
TO THE PARTIES SET FORTH
IN SCHEDULE A HERETO
RE: US Airways, Inc./Leveraged Lease Financing of One Airbus
[A320] [A330-300] Aircraft [N _____ US] - Subordination
Agent
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity
("STATE STREET") and as Subordination Agent (the "SUBORDINATION AGENT")
under the Intercreditor Agreement dated as of [________________] (the
"INTERCREDITOR AGREEMENT") among State Street Bank , in its capacity as
Pass Through Trustee under the US Airways Pass Through Trust 1999-1A, US
Airways Pass Through Trust 1999-1B and US Airways Pass Through Trust
1999-1C, [_______________], as Class A Liquidity Provider, Class B
Liquidity Provider and Class C Liquidity Provider, and State Street, as
Subordination Agent in connection with the execution and delivery of the
Participation Agreement [N ____ US] dated as of [________________] (the
"PARTICIPATION AGREEMENT") by and among State Street, as Indenture Trustee,
US Airways, Inc., as Lessee (the "LESSEE"), [__________________], as Owner
Participant, State Street, as Pass Through Trustee (the "PASS THROUGH
TRUSTEE"), State Street, as Subordination Agent and First Security Bank,
National Association, as Owner Trustee and the transactions contemplated
thereby. Capitalized terms not otherwise defined herein shall have the
meanings specified in the Lease and Annex A of the Participation Agreement.
This opinion is being delivered pursuant to Section 4(a)(____) of the
Participation Agreement.
Our representation of State Street and the Subordination Agent has
been as special counsel for the limited purposes stated above. As to all
matters of fact (including factual conclusions and characterizations and
descriptions of purpose, intention or other state of mind), we have relied,
with your permission, entirely upon (i) the representations and warranties
of the parties set forth in the Operative Documents and (ii) certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations, warranties and
certificates.
We have examined the Participation Agreement, the Note Purchase
Agreement and the Intercreditor Agreement (the "OPERATIVE DOCUMENTS"), the
Certificate of the Comptroller of the Currency relating to State Street and
originals, or copies certified or otherwise identified to our satisfaction,
of such other records, documents, certificates, or other instruments as we
have deemed necessary or advisable for the purposes of this opinion. For
purposes of our opinion rendered in paragraph 1 below, with respect to the
authority of State Street to operate as a national banking association and
exercise trust powers, our opinion relies upon and is limited by such
Certificate of the Comptroller of the Currency.
We have assumed the genuineness of all signatures (other than those
on behalf of State Street and the Subordination Agent), the conformity to
the originals of all documents reviewed by us as copies, and the
authenticity and completeness of all original documents reviewed by us in
original or copy form and the legal competence of each individual executing
any document (other than on behalf of State Street and the Subordination
Agent).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we
are aware or which are known to us, or with another similar qualification,
the relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion,
the individual lawyers in the firm who have participated directly in the
specific transactions to which this opinion relates and the partner of the
firm responsible for State Street corporate trust matters, and without any
special or additional investigation undertaken for the purposes of this
opinion.
Subject to the limitation set forth below, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions set forth below are limited solely to the internal
substantive laws of the State of Connecticut as applied by courts located
in Connecticut and the federal laws of the United States. No opinion is
given herein as to the choice of law or internal substantive rules of law
that any court or other tribunal may apply to the transactions contemplated
by the Operative Documents. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
no opinion is expressed as to matters governed by any law, statute, rule or
regulation of the United States relating to the acquisition, ownership,
registration, use, operation, maintenance, repair, replacement or sale of
or the nature of the Aircraft.
To the extent to which this opinion deals with matters governed by or
relating to the laws of the State of New York, or other jurisdiction other
than the State of Connecticut, by which the Operative Documents are stated
to be governed, we have assumed, with your permission that the Operative
Documents are governed by the internal substantive laws of the State of
Connecticut.
Our opinion is further subject to the following exceptions,
qualifications and assumptions:
I. We have assumed without any independent investigation
that (i) each party to the Operative Documents, other than
State Street, in its individual capacity or as Subordination
Agent, as applicable, at all times relevant thereto, is validly
existing and in good standing under the laws of the
jurisdiction in which it is organized, and is qualified to do
business and in good standing under the laws of each
jurisdiction where such qualification is required generally or
necessary in order for such party to enforce its rights under
such Operative Documents, and (ii) each party to the Operative
Documents, at all times relevant thereto, had and has the full
power, authority and legal right under its certificate of
incorporation, partnership agreement, by-laws, and other
governing organizational documents, and the applicable
corporate, partnership, or other enterprise legislation and
other applicable laws, as the case may be (other than State
Street and the Subordination Agent with respect to the laws of
the United States of America and the internal substantive laws
of the State of Connecticut, but only in each case to the
limited extent the same may be applicable to State Street or
the Subordination Agent, and relevant to our opinions expressed
below) to execute, and to perform its obligations under, the
Operative Documents, and (iii) each party to the Operative
Documents (other than State Street or the Subordination Agent,
as applicable) has duly executed and delivered each of such
agreements and instruments to which it is a party and that
(other than with respect to State Street and the Subordination
Agent, as applicable) the execution and delivery of such
agreements and instruments and the transactions contemplated
thereby have been duly authorized by proper corporate or other
organizational proceedings as to such party.
II. We have assumed without any independent investigation (i)
that each of the Operative Documents is a valid, binding and
enforceable obligation of each party thereto other than State
Street or the Subordination Agent, as applicable, and (ii) that
each of the Operative Documents is a valid, binding and
enforceable obligation of State Street or the Subordination
Agent, as applicable, to the extent that laws other than those
of the State of Connecticut are relevant thereto (other than
the laws of the United States of America, but only to the
limited extent the same may be applicable to State Street or
the Subordination Agent, as applicable, and relevant to our
opinions expressed below).
III. The enforcement of any obligations of State Street
or the Subordination Agent, as applicable, under any of the
Operative Documents may be limited by the receivership,
conservatorship and supervisory powers of bank regulatory
agencies generally, as well as by bankruptcy, insolvency,
reorganization, moratorium, marshaling or other laws and rules
of law affecting the enforcement generally of creditors' rights
and remedies (including such as may deny giving effect to
waivers of debtors' or guarantors' rights); and we express no
opinion as to the status under any fraudulent conveyance laws
or fraudulent transfer laws of any of the obligations of State
Street or the Subordination Agent, as applicable, under any of
the Operative Documents.
IV. We express no opinion as the availability of any
specific or equitable relief of any kind.
V. The enforcement of any of your rights may in all cases be
subject to an implied duty of good faith and fair dealing and
to general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in
equity) and, as to any of your rights to collateral security,
will be subject to a duty to act in a commercially reasonable
manner.
VI. We express no opinion as to the enforceability of any
particular provision of any of the Operative Documents relating
to (i) waivers of rights to object to jurisdiction or venue, or
consents to jurisdiction or venue, (ii) waivers of rights to
(or methods of) service of process, or rights to trial by jury,
or other rights or benefits bestowed by operation of law, (iii)
waivers of any applicable defenses, setoffs, recoupments, or
counterclaims, (iv) the grant of powers of attorney to any
person or entity, (v) exculpation or exoneration clauses,
indemnity clauses, and clauses relating to releases or waivers
of unmatured claims or rights, (vi) the imposition or
collection of interest on overdue interest or providing for a
penalty rate of interest or late charges on overdue or
defaulted obligations, or the payment of any premium,
liquidated damages, or other amount which may be held by any
court to be a "penalty" or a "forfeiture," or (vii) so-called
"usury savings clauses" purporting to specify methods of (or
otherwise assure) compliance with usury laws or other similar
laws of any jurisdiction.
VII. We express no opinion as to the effect of events
occurring, circumstances arising, or changes of law becoming
effective or occurring, after the date hereof on the matters
addressed in this opinion letter, and we assume no
responsibility to inform you of additional or changed facts, or
changes in law, of which we may become aware.
VIII. No opinion is given herein as to the effect of
usury laws (or other similar laws) of any jurisdiction with
respect to the Operative Documents.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their successors and assigns in connection
with the transactions contemplated by the Operative Documents and may not
be used or relied upon by any other person or for any other purpose.
1. State Street is a national banking association, validly formed and
authorized to operate as a national banking association under the laws of
the United States of America and, in its individual capacity or as
Subordination Agent, as the case may be, has the requisite corporate and
trust power and authority to execute, deliver and perform its obligations
under the Operative Documents.
2. State Street, in its individual capacity or as Subordination
Agent, as the case may be, has duly authorized the Operative Documents by
all necessary corporate or trust action and has duly executed and delivered
the Operative Documents, and the Operative Documents constitute valid and
binding obligations of State Street, in its individual capacity or as
Subordination Agent, as the case may be, enforceable against State Street,
in its individual capacity or as Subordination Agent, as the case may be,
in accordance with their respective terms.
3. The authorization, execution, delivery and performance by State
Street, in its individual capacity or as Subordination Agent, as the case
may be, of the Operative Documents and the consummation of the transactions
therein contemplated and compliance with the terms thereof do not and will
not result in the violation of the provisions of the charter documents or
by-laws of State Street and, to the best of our knowledge, do not conflict
with, or result in a breach of any terms or provisions of, or constitute a
default under, or result in the creation or the imposition of any lien,
charge or encumbrance upon any property or assets of State Street under any
indenture, mortgage or other agreement or instrument, in each case known to
us, to which State Street is a party or by which it is bound, or violates
any applicable Connecticut or federal law, rule or regulation governing
State Street's banking or trust powers, or, to the best of our knowledge,
of any judgment, order or decree, in each case known to us, applicable to
State Street of any court, regulatory body, administrative agency,
government or governmental body having jurisdiction over State Street.
4. No authorization, approval, consent, license or order of, giving
of notice to, registration with, or taking of any other action in respect
of, any federal or state governmental authority or agency pursuant to any
federal or Connecticut law governing the banking or trust powers of State
Street is required for the authorization, execution, delivery and
performance by State Street, in its individual capacity or as Subordination
Agent, as the case may be, of the Operative Documents or the consummation
of any of the transactions by State Street, in its individual capacity or
as Subordination Agent, as the case may be, contemplated thereby (except as
shall have been duly obtained, given or taken); and such authorization,
execution, delivery, performance, consummation and issuance do not conflict
with or result in a breach of the provisions of any such law.
5. There are no taxes, fees or other governmental charges payable
under the laws of the State of Connecticut or any political subdivision of
such State in connection with the execution and delivery by State Street,
in its individual capacity or as Subordination Agent, as the case may be,
of the Operative Documents (except for taxes on any fees payable to State
Street in its individual capacity) which are imposed solely because State
Street has its principal place of business in Connecticut or performs its
administrative duties under the Operative Documents in Connecticut.
6. To our knowledge, but without having investigated any governmental
records or court dockets, and without having made any other independent
investigation, there are no proceedings pending or overtly threatened in
writing against or affecting State Street in any court or before any
governmental authority, agency, arbitration board or tribunal which, if
adversely determined, individually or in the aggregate, could reasonably be
expected to affect materially and adversely the trust related to the
Indenture or affect the right, power and authority of State Street, in its
individual capacity or as Subordination Agent, as the case may be, to enter
into or perform its obligations under the Operative Documents.
7. Assuming that the Subordination Agent holds each of the Equipment
Notes delivered to and registered in its name pursuant to and as required
by the Intercreditor Agreement, it holds such Equipment Notes in trust as
trustee for the related Pass Through Trustee in the exercise of the
fiduciary powers conferred upon State Street by Connecticut law.
Very truly yours,
BINGHAM DANA LLP
SCHEDULE A
----------
State Street Bank and Trust Company of Connecticut, National Association
First Security Bank, National Association
[____________________], as Owner Participant
US Airways, Inc.
US Airways Group, Inc.
Standard & Poor's Ratings Service
Moody's Investors Service, Inc.
Credit Suisse First Boston Corporation
Exhibit 4(a)(xiv)
Exhibit A-2-1
to
Note Purchase
Agreement
[LEASE FORM - BASIC]
LEASE AGREEMENT
(US Airways, Inc. Trust No. N___U_)
Dated as of
________ __,____
Between
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Not in its individual capacity except as expressly
provided herein, but solely as Owner Trustee,
Lessor
and
US AIRWAYS, INC.,
Lessee
One Airbus Model A___(1) Aircraft
As set forth in Section 21 hereof, Lessor has assigned to the Indenture
Trustee (as defined herein) certain of its right, title and interest in and
to this Lease. To the extent, if any, that this Lease constitutes chattel
paper (as such term is defined in the Uniform Commercial Code as in effect
in any applicable jurisdiction) no security interest in this Lease may be
created through the transfer or possession of any counterpart other than
the original executed counterpart, which shall be identified as the
counterpart containing the receipt therefor executed by the Indenture
Trustee on the signature page thereof.
------------------
(1) Insert "A319", "A320", or "A330".
Form Lease
N____U_
TABLE OF CONTENTS TO LEASE AGREEMENT
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2. ACCEPTANCE AND LEASE . . . . . . . . . . . . . . . . . . . . 1
SECTION 3. TERM AND RENT . . . . . . . . . . . . . . . . . . . . . . . 1
(a) Basic Term . . . . . . . . . . . . . . . . . . . . . . . . . 1
(b) Basic Rent . . . . . . . . . . . . . . . . . . . . . . . . . 1
(c) Adjustments to Basic Rent . . . . . . . . . . . . . . . . . 2
(d) Supplemental Rent . . . . . . . . . . . . . . . . . . . . . 3
(e) Payments in General . . . . . . . . . . . . . . . . . . . . 4
(f) Business Day Convention . . . . . . . . . . . . . . . . . . 5
SECTION 4. DISCLAIMER; LESSOR'S REPRESENTATIONS, WARRANTIES AND
AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . 5
(a) Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . 5
(b) Representations, Warranties and Covenants of
First Security Bank . . . . . . . . . . . . . . . . . . . . 6
(c) Lessor's Covenants . . . . . . . . . . . . . . . . . . . . . 6
(d) Manufacturer's Warranties . . . . . . . . . . . . . . . . . 7
SECTION 5. RETURN OF THE AIRCRAFT. . . . . . . . . . . . . . . . . . . 7
(a) Condition Upon Return . . . . . . . . . . . . . . . . . . . 7
(b) Parking and Related Matters . . . . . . . . . . . . . . . . 7
(c) Return of Other Engines . . . . . . . . . . . . . . . . . . 8
(d) Obligations Continue Until Return . . . . . . . . . . . . . 8
SECTION 6. LIENS . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 7. REGISTRATION, MAINTENANCE, OPERATION AND REGISTRATION;
POSSESSION AND SUBLEASES; INSIGNIA . . . . . . . . . . . . . 9
(a) Registration, Maintenance, Operation and Registration. . . . 9
(1) Registration and Maintenance. . . . . . . . . . . . . . 9
(2) Operation . . . . . . . . . . . . . . . . . . . . . . 10
(3) Reregistration . . . . . . . . . . . . . . . . . . . 11
(b) Possession and Subleases . . . . . . . . . . . . . . . . . 11
(c) Insignia . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 8. REPLACEMENT AND POOLING OF PARTS; ALTERATIONS, MODIFICATIONS
AND ADDITIONS . . . . . . . . . . . . . . . . . . . . . . . 17
(a) Replacement of Parts . . . . . . . . . . . . . . . . . . . 17
(b) Pooling of Parts . . . . . . . . . . . . . . . . . . . . . 18
(c) Alterations, Modifications and Additions . . . . . . . . . 19
(d) Certain Matters Regarding Passenger Convenience
Equipment . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 9. VOLUNTARY TERMINATION . . . . . . . . . . . . . . . . . . 20
(a) Termination Event . . . . . . . . . . . . . . . . . . . . 20
(b) Optional Sale of the Aircraft . . . . . . . . . . . . . . 21
(c) Termination as to Engines . . . . . . . . . . . . . . . . 23
(d) Special Purchase Options . . . . . . . . . . . . . . . . . 24
SECTION 10. LOSS, DESTRUCTION, REQUISITION, ETC. . . . . . . . . . . . 25
(a) Event of Loss with Respect to the Aircraft . . . . . . . . 25
(b) Event of Loss with Respect to an Engine . . . . . . . . . 27
(c) Application of Payments from Governmental
Authorities for Requisition of Title, etc. . . . . . . . . 28
(d) Requisition for Use of the Aircraft by the United States
Government or the Government of Registry of the Aircraft . 29
(e) Requisition for Use of an Engine by the United States
Government or the Government of Registry of the Aircraft . 30
(f) Application of Payments During Existence of
Event of Default . . . . . . . . . . . . . . . . . . . . . 30
SECTION 11. INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . 31
(a) Lessee's Obligation to Insure . . . . . . . . . . . . . . 31
(b) Additional Insurance by Lessor and Lessee . . . . . . . . 31
(c) Indemnification by Government in Lieu of Insurance . . . . 31
(d) Application of Payments During Existence of an Event of
Default . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 12. INSPECTION . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 13. ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 14. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . 34
SECTION 15. REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 16. LESSEE'S COOPERATION CONCERNING CERTAIN MATTERS; DELIVERY OF
FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . 40
SECTION 17. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 18. NO SET-OFF, COUNTERCLAIM, ETC. . . . . . . . . . . . . . . 42
SECTION 19. RENEWAL OPTIONS; PURCHASE OPTIONS; VALUATION . . . . . . . 43
(a) Renewal Options. . . . . . . . . . . . . . . . . . . . . . 43
(1) Fixed Renewal Term . . . . . . . . . . . . . . . . . 43
(2) Fair Market Renewal Term . . . . . . . . . . . . . . 43
(3) Waiver . . . . . . . . . . . . . . . . . . . . . . . 43
(4) Conditions Precedent, Payment of Basic Rent . . . . . 44
(5) Termination Value . . . . . . . . . . . . . . . . . . 44
(b) Purchase Options . . . . . . . . . . . . . . . . . . . . . 44
(c) Valuation . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 20. BURDENSOME PURCHASE OPTION . . . . . . . . . . . . . . . . 47
SECTION 21. SECURITY FOR LESSOR'S OBLIGATION TO HOLDERS OF EQUIPMENT
NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 22. LESSOR'S RIGHT TO PERFORM FOR LESSEE . . . . . . . . . . . 48
SECTION 23. INVESTMENT OF SECURITY FUNDS; LIABILITY OF LESSOR LIMITED 49
(a) Investment of Security Funds . . . . . . . . . . . . . . . 49
(b) Liability of Lessor Limited . . . . . . . . . . . . . . . 49
SECTION 24. JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 25. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 26. SUCCESSOR TRUSTEE . . . . . . . . . . . . . . . . . . . . 50
SECTION 27. LEASE FOR U.S. FEDERAL INCOME TAX LAW PURPOSES; SECTION 1110
OF BANKRUPTCY CODE . . . . . . . . . . . . . . . . . . . . 51
(a) Lease for Federal Income Tax Law Purposes . . . . . . . . 51
(b) Section 1110 of Bankruptcy Code . . . . . . . . . . . . . 51
EXHIBITS
EXHIBIT A - FORM OF LEASE SUPPLEMENT
EXHIBIT B - PAST DUE RATE DEFINED; BASIC RENT AND LESSOR'S COST
EXHIBIT C - TERMINATION VALUE SCHEDULE
EXHIBIT D - EBO AMOUNT
EXHIBIT E - RENT RECALCULATION AND INDEMNIFICATION VERIFICATION
EXHIBIT F - SCHEDULE OF DOMICILES OF PERMITTED SUBLESSEES
EXHIBIT G - RETURN CONDITIONS
EXHIBIT H - INSURANCE
Form Lease
N____U_
LEASE AGREEMENT
(US Airways, Inc. Trust No. N___U_)
This LEASE AGREEMENT (US Airways, Inc. Trust No. N___U_), dated as
of __________ __,____, between FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not in its individual capacity, except as expressly provided herein, but
solely as Owner Trustee under the Trust Agreement (as defined in Annex A
hereto) (in such capacity, "Lessor"), and US AIRWAYS, INC., a corporation
organized and existing pursuant to the laws of the State of Delaware
("Lessee");
W I T N E S S E T H:
Section 1. DEFINITIONS. Capitalized terms used but not defined
herein shall have the respective meanings set forth or incorporated by
reference, and shall be construed and interpreted in the manner described,
in Annex A.
Section 2. ACCEPTANCE AND LEASE. Lessor hereby agrees (subject
to satisfaction of the conditions set forth in Section 4(a) of the
Participation Agreement) to accept the transfer of title from and
simultaneously to lease to Lessee hereunder, and Lessee hereby agrees
(subject to satisfaction of the conditions set forth in Section 4(b) of the
Participation Agreement) to lease from Lessor hereunder, the Aircraft as
evidenced by the execution by Lessor and Lessee of a Lease Supplement
leasing the Aircraft hereunder. Lessee hereby agrees that such acceptance
of the Aircraft by Lessor shall, without further act, irrevocably
constitute acceptance by Lessee of such Aircraft for all purposes of this
Lease.
Section 3. TERM AND RENT.
(a) Basic Term. The Basic Term shall commence on the Delivery
Date and end on the Basic Term Expiration Date.
(b) Basic Rent. Lessee shall pay Basic Rent with respect to each
Lease Period during the Basic Term on each Lease Period Date during the
Basic Term, in consecutive installments in the amounts as provided in the
next sentence, each such installment to cover the Lease Period specified in
Exhibit B. Each such installment of Basic Rent shall be equal to Lessor's
Cost multiplied by the percentage for the Delivery Date or applicable Lease
Period Date, as the case may be, specified in Exhibit B hereto.
(c) Adjustments to Basic Rent.
(i) In the event of a refinancing as contemplated by Section
16 of the Participation Agreement, then the Basic Rent percentages set
forth in Exhibit B, the Termination Value percentages set forth in
Exhibit C and the EBO Amount set forth on Exhibit D shall be
recalculated (upwards or downwards) by the Owner Participant as
contemplated by such Section to (1) maintain the Owner Participant's Net
Economic Return and (2) to the extent possible consistent with clause
(1) hereof, minimize the Net Present Value of Rents to Lessee;
(ii) In the event that Lessee elects to satisfy any indemnity
obligation under the Tax Indemnity Agreement, then the Basic Rent
percentages set forth in Exhibit B, the Termination Value percentages
set forth in Exhibit C and the EBO Amount set forth on Exhibit D shall
be recalculated (upwards or downwards) by the Owner Participant, using
the same methods and assumptions (except to the extent such assumptions
shall be varied to take into account the Loss (as defined in the Tax
Indemnity Agreement) that is the subject of such indemnification and any
prior or contemporaneous Loss) used to calculate the Basic Rent
percentages, the Termination Value percentages and the EBO Amount on the
Delivery Date, in order to (1) maintain the Owner Participant's Net
Economic Return and (2) to the extent possible consistent with clause
(1) hereof, minimize the Net Present Value of Rents to Lessee.
(iii) Whenever Basic Rent is recalculated pursuant to this
Section 3(c), the Owner Participant shall redetermine the Termination
Value percentages set forth in Exhibit C and the EBO Amount set forth in
Exhibit D in a manner consistent with such recalculation.
(iv) Any recalculation of Basic Rent and Termination Value
percentages pursuant to this Section 3(c) shall be determined by the
Owner Participant and shall be subject to the verification procedures
set forth in Exhibit E hereto. Such recalculated Basic Rent and
Termination Value percentages shall be set forth in a Lease Supplement
or an amendment to this Lease.
(v) Anything contained in the Participation Agreement or this
Lease to the contrary notwithstanding (I) each installment of Basic Rent
payable hereunder, whether or not adjusted in accordance with this
Section 3(c), shall be, under any circumstances and in any event, in an
amount at least sufficient to pay in full, on the date on which such
installment of Basic Rent is due, any payments then scheduled to be made
on account of the principal of and interest on the Equipment Notes and
(II) the amount of Termination Value payable on any Termination Date,
Loss Payment Date or, in the case of payments under Sections 15 and 20,
Lease Period Date, whether or not adjusted in accordance with this
Section 3(c), together with all other amounts payable hereunder by
Lessee on such date and the amount of the premium, if any, payable by
Lessor on the Equipment Notes, shall be, under any circumstances and in
any event, in an amount at least sufficient for Lessor to pay in full,
on such Termination Date, Loss Payment Date or Lease Period Date, the
outstanding principal of, premium, if any, and interest on the Equipment
Notes. It is agreed that no installment of Basic Rent, payment of
Termination Value or EBO Amount shall be increased or adjusted by reason
of (i) any attachment or diversion of Rent on account of (A) Lessor
Liens or (B) any Loan Participant Lien or other Lien on or against the
Trust Estate, any part thereof or the Operative Documents arising as a
result of claims against the Indenture Trustee not related to the
transactions contemplated by the Operative Documents, (ii) any
modification of the payment terms of the Equipment Notes made without
the prior written consent of Lessee or (iii) the acceleration of any
Equipment Note or Equipment Notes due to the occurrence of an Indenture
Event of Default which does not constitute a Lease Event of Default.
(vi) All adjustments to Basic Rent under this Section 3(c)
shall be subject to verification pursuant to Exhibit E.
(d) Supplemental Rent. Lessee shall pay (or cause to be paid)
promptly to Lessor, or to whomsoever shall be entitled thereto, any and all
Supplemental Rent constituting Termination Value and Make-Whole Amount as
the same shall become due and owing and all other amounts of Supplemental
Rent within five Business Days (5) days after demand or within such other
relevant period as may be provided in any Operative Document, and in the
event of any failure on the part of Lessee to pay any Supplemental Rent
when due, Lessor shall have all rights, powers and remedies provided for
herein or in any other Operative Document or by law or equity or otherwise
in the case of nonpayment of Basic Rent. Lessee shall pay as Supplemental
Rent the Make-Whole Amount, if any, due pursuant to Section 2.10(b) or
Section 2.11 of the Trust Indenture in connection with a prepayment of the
Equipment Notes upon redemption of such Equipment Notes in accordance with
Section 2.10(b) or Section 2.11 of the Trust Indenture. Lessee also will
pay to Lessor, or to whomsoever shall be entitled thereto, on demand, as
Supplemental Rent, to the extent permitted by applicable law, interest at
the Past Due Rate on any part of any installment of Basic Rent not paid
when due for any period for which the same shall be overdue and on any
payment of Supplemental Rent not paid when due for the period until the
same shall be paid.
(e) Payments in General. All payments of Rent shall be made
directly by Lessee (whether or not any Sublease shall be in effect) by wire
transfer of immediately available funds prior to 11:00 a.m., New York time,
on the date of payment, to Lessor at its account at First Security Bank,
National Association, 79 South Main Street, 3rd Floor, Salt Lake City, Utah
84111, ABA No. 124-0000-12, Account No.___________, Attention: Corporate
Trust Department, Credit US Airways/US Airways, Inc. Trust No. N___U_ (or
such other account of Lessor in the continental United States as Lessor
shall direct in a notice to Lessee at least ten (10) Business Days prior to
the date such payment of Rent is due); provided that so long as the Trust
Indenture shall not have been fully discharged, Lessor hereby irrevocably
directs and Lessee agrees, that, unless the Indenture Trustee shall
otherwise direct, all Rent payable to Lessor and assigned to the Indenture
Trustee pursuant to the Trust Indenture shall be paid prior to 11:00 a.m.,
New York time on the due date thereof in funds of the type specified in
this Section 3(e) directly to the Indenture Trustee at its account at State
Street Bank and Trust Company of Connecticut, National Association, 225
Asylum Street, Hartford, Connecticut 06103, ABA No. _________, Account No.
__________, Reference: US Airways, Inc. ____-1EETC/US Airways, Inc. Trust
No. N___U_ (or such other account of the Indenture Trustee in the
continental United States as the Indenture Trustee shall direct in a notice
to Lessee at least ten (10) Business Days prior to the date such payment of
Rent is due). Lessor hereby directs and Lessee agrees that all payments of
Supplemental Rent owing to the Indenture Trustee or to a Loan Participant
or any other Person (other than the Excluded Payments payable to the Owner
Participant) pursuant to the Participation Agreement shall be made in
Dollars in immediately available funds prior to 11:00 a.m., New York time,
on the due date thereof at the office of the Indenture Trustee or at such
other office of such other financial institution located in the continental
United States as the party entitled thereto may so direct at least ten (10)
Business Days prior to the due date thereof. All payments of Supplemental
Rent payable to the Owner Participant, to the extent that such amounts
constitute Excluded Payments, shall be made in Dollars in immediately
available funds prior to 11:00 a.m., New York time, on the due date
thereof, to the account of the Owner Participant specified in Schedule I to
the Participation Agreement (or to such other account as may be specified
in writing by the Owner Participant from time to time).
(f) Business Day Convention. Notwithstanding anything to the
contrary contained herein, if any date on which a payment of Rent 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 with the same force and effect as if made on such scheduled date and
(provided such payment is made on such next succeeding Business Day) no
interest shall accrue on the amount of such payment from and after such
scheduled date.
Section 4. DISCLAIMER; LESSOR'S REPRESENTATIONS, WARRANTIES AND
AGREEMENTS.
(a) Disclaimer. LESSOR LEASES AND LESSEE TAKES THE AIRCRAFT AND
EACH PART THEREOF "AS-IS," "WHERE-IS." EXCEPT AS EXPRESSLY PROVIDED HEREIN,
NEITHER LESSOR, THE INDENTURE TRUSTEE NOR ANY PARTICIPANT MAKES, HAS MADE
OR SHALL BE DEEMED TO HAVE MADE, AND EACH HEREBY EXPRESSLY DISCLAIMS AND
WILL BE DEEMED TO HAVE EXPRESSLY DISCLAIMED, ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS, WORKMANSHIP,
CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR USE OR A
PARTICULAR PURPOSE OF THE AIRCRAFT 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 WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO
THE AIRCRAFT OR ANY PART THEREOF.
(b) Representations, Warranties and Covenants of First Security
Bank. First Security Bank, National Association, in its individual
capacity, (i) represents and warrants that on the Delivery Date, Lessor
shall have received whatever title to the Aircraft was conveyed to it by
Lessee, (ii) represents and warrants that on the Delivery Date the Aircraft
shall be free of Lessor Liens attributable to it, (iii) covenants that
neither it nor any Person claiming by, through or under it will, through
its own actions or inactions, interfere in Lessee's or any Sublessee's
continued possession, use, operation and quiet enjoyment of the Aircraft
during the Term unless an Event of Default has occurred and is continuing
and this Lease has been duly declared in default, and this Lease shall not
be terminated except as expressly provided herein, (iv) covenants that it
will not directly or indirectly create, incur, assume or suffer to exist
any Lessor Lien attributable to it on or with respect to the Airframe or
any Engine or any portion of the Trust Estate and (v) represents and
warrants that it is a Citizen of the United States without making use of a
voting trust, voting powers agreement or similar arrangement, and agrees
that if at any time it shall cease to be a Citizen of the United States
without making use of a voting trust, voting powers agreement or similar
arrangement it will promptly resign as Owner Trustee (if and so long as
such citizenship is necessary under the Transportation Code as in effect at
such time or, if it is not necessary, if and so long as the Owner Trustee's
citizenship would have any material adverse effect on the Loan
Participants, the Owner Participant or Lessee), effective upon the
appointment of a successor Owner Trustee in accordance with Section 9.01 of
the Trust Agreement.
(c) Lessor's Covenants. Lessor (i) covenants that neither it nor
any Person claiming by, through or under it will, through its own actions
or inactions, interfere in Lessee's or any Sublessee's continued
possession, use, operation and quiet enjoyment of the Aircraft during the
Term unless an Event of Default has occurred and is continuing and this
Lease has been duly declared in default, and this Lease shall not be
terminated except as expressly provided herein and (ii) covenants that it
will not directly or indirectly create, incur, assume or suffer to exist
any Lessor Lien attributable to it on or with respect to the Airframe or
any Engine.
(d) Manufacturer's Warranties. None of the provisions of this
Lease shall be deemed to amend, modify or otherwise affect the
representations, warranties or other obligations (express or implied) of
the Seller, the Manufacturer, any subcontractor or supplier of the
Manufacturer with respect to the Airframe, the Engines or any Parts, or to
release the Seller, the Manufacturer, or any such subcontractor or
supplier, from any such representation, warranty or obligation. Unless an
Event of Default shall have occurred and be continuing under Section 14 and
this Lease shall have been declared in default, Lessor agrees to make
available to Lessee such rights as Lessor may have under any warranty with
respect to the Aircraft made by the Seller, the Manufacturer or any
affiliate thereof or any of its subcontractors or suppliers and any other
claims against the Seller, the Manufacturer or any affiliate thereof, or
any such subcontractor or supplier with respect to the Aircraft, all
pursuant to and in accordance with the terms of the Purchase Agreement
Assignment.
Section 5. RETURN OF THE AIRCRAFT.
(a) Condition Upon Return. Lessee shall comply with each of the
provisions of Exhibit G, which provisions are hereby incorporated by this
reference as if set forth in full herein.
(b) Parking and Related Matters. Unless Lessee has elected to
purchase the Aircraft in accordance with the terms hereof, if Lessor gives
written notice to Lessee not less than sixty (60) days nor more than one
hundred eighty (180) days prior to the end of the Term requesting storage
of the Aircraft upon its return hereunder, Lessee will provide Lessor, or
cause Lessor to be provided, with outdoor parking facilities for the
Aircraft for a period up to thirty (30) days, commencing on the date of
such return, at such storage facility in the forty eight (48) contiguous
states of the United States as Lessee may select; provided that such
location shall be a location generally used for the parking of commercial
aircraft by aircraft owners or operators. Notwithstanding subsection (a)
of Exhibit G, such location shall be deemed to be the return location of
the Aircraft for purposes of such Exhibit G. Such parking shall be at
Lessor's risk and expense and Lessor shall pay all applicable storage,
maintenance and insurance fees and expenses. Lessee's obligation to
arrange parking shall be subject to Lessee and Lessor entering into an
agreement prior to the commencement of the storage period with the storage
facility providing, among other things, that Lessor shall bear all
maintenance charges and other costs incurred relating to such storage.
(c) Return of Other Engines. In the event that any Engine owned
by Lessor shall not be installed on the Airframe at the time of return
hereunder, Lessee shall be required to return the Airframe hereunder with
an Acceptable Alternate Engine meeting the requirements of, and in
accordance with, Section 10 and Exhibit G hereto. Thereupon, Lessor will
transfer to Lessee the Engine constituting part of such Aircraft but not
installed on such Airframe at the time of the return of the Airframe.
(d) Obligations Continue Until Return. If Lessee shall, for any
reason, fail to return the Aircraft at the time specified herein, all
obligations of Lessee under this Lease shall continue in effect with
respect to the Aircraft until the Aircraft is returned to Lessor and Lessee
shall pay to Lessor an amount equal to the average daily Basic Rent payable
by Lessee during the Term for each day after the end of the Term to but
excluding the day of such return; provided, however, that Lessee shall not
be responsible for Lessor's failure to accept return of the Aircraft in
accordance with this Section 5 in a timely manner or for any Rent with
respect to periods after Lessee has tendered the Aircraft for return in
accordance with this Lease. Any Rent owed to Lessor pursuant to this
Section 5(d) shall be payable upon acceptance of the Aircraft by Lessor or
on the last day of each calendar month following the last day of the Term
if the Aircraft has not been accepted earlier.
Section 6. LIENS. Lessee will not directly or indirectly
create, incur, assume or suffer to exist any Lien on or with respect to the
Aircraft, title thereto or any interest therein or in this Lease, except
(i) the respective rights of Lessor as owner of the Aircraft and Lessee as
herein provided, the Lien of the Trust Indenture, the rights of any
Sublessee under a sublease permitted hereunder and any other rights of any
Person existing pursuant to the Operative Documents, (ii) the rights of
others under agreements or arrangements to the extent permitted by the
terms of Sections 7(b) and 8(b) hereof, (iii) Lessor Liens, Loan
Participant Liens and Indenture Trustee's Liens, (iv) Liens for Taxes of
Lessee (or any Sublessee) either not yet due or being contested in good
faith by appropriate proceedings so long as such proceedings do not involve
any material danger of the sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (v) materialmen's, mechanics', workmen's,
repairmen's, employees' or other like Liens arising in the ordinary course
of Lessee's (or, if a Sublease is then in effect, Sublessee's) business
(including those arising under maintenance agreements entered into in the
ordinary course of business) securing obligations that are not overdue for
a period of more than sixty (60) days or are being contested in good faith
by appropriate proceedings so long as such proceedings do not involve any
material danger of the sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (vi) Liens arising out of any judgment or
award against Lessee (or any Sublessee), unless the judgment secured shall
not, within sixty (60) days after the entry thereof, have been discharged,
vacated, reversed or execution thereof stayed pending appeal or shall not
have been discharged, vacated or reversed within sixty (60) days after the
expiration of such stay, (vii) any other Lien with respect to which Lessee
(or any Sublessee) shall have provided a bond, cash collateral or other
security adequate in the reasonable opinion of Lessor, and (viii) Liens
approved in writing by Lessor. Lessee will promptly, at its own expense,
take (or cause to be taken) such actions as may be necessary duly to
discharge any such Lien not excepted above if the same shall arise at any
time.
Section 7. REGISTRATION, MAINTENANCE, OPERATION AND
REGISTRATION; POSSESSION AND SUBLEASES; INSIGNIA.
(a) Registration, Maintenance, Operation and Registration.
(1) Registration and Maintenance. Lessee, at its own cost
and expense, shall (or shall cause any Sublessee to): (A) forthwith
upon the delivery thereof hereunder, cause the Aircraft to be duly
registered in the name of Lessor, and, subject to clause 3 of this
Section 7(a) and Section 7(d) of the Participation Agreement, to
remain duly registered in the name of Lessor under the Transportation
Code, provided that Lessor shall execute and deliver all such
documents as Lessee (or any Sublessee) may reasonably request for the
purpose of effecting and continuing such registration, and shall not
register the Aircraft or permit the Aircraft to be registered under
any laws other than the Transportation Code at any time except as
provided in Section 7(d) of the Participation Agreement and, unless
the Lien of the Trust Indenture shall have been discharged, shall
cause the Trust Indenture to be duly recorded and maintained of record
as a first mortgage on the Aircraft; (B) maintain, service, repair
and/or overhaul (or cause to be maintained, serviced, repaired and/or
overhauled) the Aircraft so as to keep the Aircraft in as good an
operating condition as when delivered by the Seller to Lessee,
ordinary wear and tear excepted, and as may be necessary to enable the
applicable airworthiness certification for the Aircraft to be
maintained in good standing at all times (other than during temporary
periods of storage or during maintenance or modification permitted
hereunder) under the Transportation Code, except when all of Lessee's
Airbus Model A___(2) aircraft powered by engines of the same type as
those with which the Airframe shall be equipped at the time of such
grounding and registered in the United States have been grounded by
the FAA (although such certification need actually be maintained only
during such periods as the Aircraft is registered in the United
States), or the applicable laws of any other jurisdiction in which the
Aircraft may then be registered from time to time in accordance with
Section 7(d) of the Participation Agreement, utilizing, except during
any period that a Sublease is in effect, the same manner and standard
of maintenance, service, repair or overhaul used by Lessee with
respect to similar aircraft operated by Lessee in similar
circumstances and utilizing, during any period that a Sublease is in
effect, the same manner and standard of maintenance, service, repair
or overhaul used by the Sublessee with respect to similar aircraft
operated by the Sublessee in similar circumstances; (C) maintain or
cause to be maintained in English all records, logs and other
materials required to be maintained in respect of the Aircraft by the
FAA or the applicable regulatory agency or body of any other
jurisdiction in which the Aircraft may then be registered; and (D)
promptly furnish or cause to be furnished to Lessor and the Owner
Participant such information as may be required to enable Lessor to
file any reports required to be filed by Lessor or the Owner
Participant with any governmental authority because of Lessor's
ownership of the Aircraft.
(2) Operation. Lessee will not maintain, use, service,
repair, overhaul or operate the Aircraft (or permit any Sublessee to
maintain, use, service, repair, overhaul or operate the Aircraft) in
violation of any law or any rule, regulation, order or certificate of
any government or governmental authority (domestic or foreign) having
jurisdiction over the Aircraft, or in violation of any airworthiness
certificate, license or registration relating to the Aircraft issued
by any such authority, except to the extent Lessee (or, if a Sublease
is then in effect, any Sublessee) is contesting in good faith the
validity or application of any such law, rule, regulation or order in
any reasonable manner which does not involve any material risk of
sale, forfeiture or loss of the Aircraft. Lessee will not operate the
Aircraft, or permit any Sublessee to operate the Aircraft, in any area
excluded from coverage by any insurance required by the terms of
Section 11; provided, however, that the failure of Lessee to comply
with the provisions of this sentence shall not give rise to an Event
of Default hereunder if indemnification complying with Section 11(c)
has been provided or where such failure is attributable to
extraordinary circumstances involving an isolated occurrence or series
of incidents not in the ordinary course of the regular operations of
Lessee (or any Sublessee) such as a hijacking, medical emergency,
equipment malfunction, weather condition, navigational error or other
causes beyond the reasonable control of Lessee (or any Sublessee).
(3) Reregistration. At any time after the Depreciation
Period, Lessor, upon Lessee's compliance with all of the terms of
Section 7(d) of the Participation Agreement, shall, at the request and
sole expense of Lessee, cooperate with Lessee to take all actions
required to change the registration of the Aircraft to another
country.
--------------
(2) Insert "A319", "A320" or "A330", as applicable.
(b) Possession and Subleases. Lessee will not, without the prior
written consent of Lessor, sublease or otherwise in any manner deliver,
transfer or relinquish possession of the Airframe or any Engine or install
or permit any Engine to be installed on any airframe other than the
Airframe or enter into any Wet Lease, and so long as Lessee (or any
Sublessee) shall comply with the provisions of Section 7(a) and Section 11
hereof, Lessee may (or may permit any Sublessee to), without the prior
written consent of Lessor:
(i) subject the Airframe and the Engines or
engines then installed thereon to interchange agreements or any Engine
to pooling or similar arrangements, in each case customary in the
airline industry and entered into by Lessee (or, if a Sublease is then
in effect, by Sublessee) in the ordinary course of its business;
provided that (A) no such agreement or arrangement contemplates or
requires the transfer of title to the Airframe, (B) if Lessor's title
to any Engine shall be divested under any such agreement or
arrangement, such divestiture shall be deemed to be an Event of Loss
with respect to such Engine and Lessee shall (or shall cause Sublessee
to) comply with Section 10(b) hereof in respect thereof, and (C) any
interchange agreement to which the Airframe may be subject shall be
with a U.S. Air Carrier or a Foreign Air Carrier.
(ii) deliver possession of the Airframe or any
Engine to the manufacturer thereof (or for delivery thereto) or to any
organization (or for delivery thereto) for testing, service, repair,
maintenance or overhaul work on the Airframe or Engine or any part of
any thereof or for alterations or modifications in or additions to
such Airframe or Engine to the extent required or permitted by the
terms of Section 8(c) hereof;
(iii) install an Engine on an airframe owned
by Lessee (or any Sublessee) free and clear of all Liens, except: (A)
Permitted Liens and those which apply only to the engines (other than
Engines), appliances, parts, instruments, appurtenances, accessories,
furnishings and other equipment (other than Parts) installed on such
airframe (but not to the airframe as an entirety), (B) the rights of
third parties under interchange agreements or pooling or similar
arrangements which would be permitted under clause (i) above, provided
that Lessor's title to such Engine and, if any Equipment Notes shall
be outstanding, the first priority Lien of the Trust Indenture shall
not be divested or impaired as a result thereof and (C) mortgage liens
or other security interests, provided that (as regards this clause
(C)) the documents creating such mortgage liens or other security
interests (or, if applicable, another written agreement governing such
mortgage liens or other security interests) effectively provide that
such Engine shall not become subject to the lien of such mortgage or
security interest, notwithstanding the installation thereof on such
airframe;
(iv) install an Engine on an airframe leased to
Lessee (or any Sublessee) or purchased by Lessee (or any Sublessee)
subject to a conditional sale or other security agreement, provided
that (x) such airframe is free and clear of all Liens, except: (A) the
rights of the parties to the lease or conditional sale or other
security agreement covering such airframe, or their assignees, and (B)
Liens of the type permitted by clause (iii) of this paragraph (b) and
(y) such lease, conditional sale or other security agreement
effectively provides that such Engine shall not become subject to the
lien of such lease, conditional sale or other security agreement,
notwithstanding the installation thereof on such airframe;
(v) install an Engine on an airframe owned by
Lessee (or any Sublessee), leased to Lessee (or any Sublessee) or
purchased by Lessee (or any Sublessee) subject to a conditional sale
or other security agreement under circumstances where neither clause
(iii) nor clause (iv) of this paragraph (b) is applicable, provided
that such installation shall be deemed an Event of Loss with respect
to such Engine and Lessee shall (or shall cause any Sublessee to)
comply with Section 10(b) hereof in respect thereof, Lessor not
intending hereby to waive any right or interest it may have to or in
such Engine under applicable law until compliance by Lessee with such
Section 10(b);
(vi) to the extent permitted by Section 8(b)
hereof, subject any appliances, Parts or other equipment owned by
Lessor and removed from the Airframe or any Engine to any pooling
arrangement referred to in Section 8(b) hereof;
(vii) subject (or permit any Sublessee to
subject) the Airframe or any Engine to the Civil Reserve Air Fleet
Program and transfer (or permit any Sublessee to transfer) possession
of the Airframe or any Engine to the United States Government or any
instrumentality or agency thereof pursuant to the Civil Reserve Air
Fleet Program, so long as Lessee (or any Sublessee) shall (A) promptly
notify Lessor upon subjecting the Airframe or any Engine to the Civil
Reserve Air Fleet Program in any contract year and provide Lessor with
the name and address of the Contracting Office Representative for the
Air Mobility Command of the United States Air Force to whom notice
must be given pursuant to Section 15 hereof, and (B) promptly notify
Lessor upon transferring possession of the Airframe or any Engine to
the United States of America or any agency or instrumentality thereof
pursuant to such program;
(viii) for a period not to extend beyond the
end of the Term, enter into a Wet Lease for the Airframe and Engines
or engines then installed thereon with any third party; provided that
if Lessee (or any Sublessee) shall enter into any Wet Lease for a
period of more than one year (including renewal options) Lessee shall
provide Lessor written notice of such Wet Lease (such notice to be
given prior to entering into such Wet Lease, if practicable, but in
any event promptly after entering into such Wet Lease);
(ix) for a period not to extend beyond the end of
the Term, transfer possession of the Airframe or any Engine to the
United States Government or any instrumentality or agency thereof
pursuant to a contract, a copy of which shall be provided to Lessor;
or
(x) Lessee may, at any time in its sole
discretion, enter into any sublease with (A) any Person domiciled in
the United States, (B) after the Depreciation Period, any Permitted
Sublessee or (C) after the Depreciation Period, any other Person
approved in writing by Lessor, which approval shall not be
unreasonably withheld; provided, however, that no sublease entered
into pursuant to this clause (x) shall extend beyond the expiration of
the Basic Term or any Renewal Term then in effect unless Lessee shall
have irrevocably committed to purchase the Aircraft or renew the Lease
in accordance with the terms hereof at the end of the Basic Term or
Renewal Term, as the case may be, to a date beyond the latest
permissible expiration date of such sublease; provided, further, with
respect to a sublease under subclauses (B) or (C) of this clause (x),
Lessee shall deliver to Lessor an opinion of counsel to the effect
that (I) the obligations of Lessee and the rights and remedies of the
Lessor under the Lease remain valid, binding and (subject to customary
bankruptcy and equitable remedies exceptions and to other exceptions
customary in such Opinions) enforceable; (II) the terms of the
sublease constitute valid and binding obligations of the Sublessee and
(subject to customary bankruptcy and equitable remedies exceptions and
to other exceptions customary in such Opinions) enforceable against
Sublessee (it being understood that such opinion may be an opinion as
to the form of the Sublease only and may assume due authorization,
execution, delivery, requisite approvals and absence of conflicts with
laws, contracts or organizational documents) under the laws of the
jurisdiction governing the sublease, (III) that there is no tort
liability of the owner of an aircraft not in possession thereof under
the laws of the jurisdiction of the proposed sublessee other than tort
liability which might have been imposed on such owner under the laws
of the United States or any state thereof (it being understood that in
the event such opinion cannot be given such opinion requirement shall
be waived if insurance reasonably satisfactory to Lessor, in its
individual capacity, is provided at Lessee's expense), and (IV) unless
Lessee shall have agreed to provide insurance covering the risk of
requisition of use of the Aircraft by the government of the
jurisdiction of the proposed sublessee reasonably satisfactory to the
Owner Participant, that the laws of such jurisdiction require fair
compensation by the government of such jurisdiction payable in
currency freely convertible into Dollars for the loss of use of the
Aircraft in the event of the requisition by such government of such
use; and provided finally that, with respect to any sublease to any
Affiliate of Lessee, (I) such sublessee shall be a Certificated Air
Carrier and (II) Lessee shall deliver to Lessor an opinion of counsel
to the effect that Lessee would be entitled to the benefits of Section
1110 of the Bankruptcy Code with respect to the Aircraft if such
Affiliate were to be a debtor in a case under Chapter 11 of the
Bankruptcy Code, such opinion to be subject to customary assumptions
and qualifications. Lessee shall provide Lessor with a copy of any
sublease which has a term of more than one (1) year.
The rights of any Sublessee or other transferee who receives
possession by reason of a transfer permitted by this paragraph (b) (other
than the transfer of an Engine which is deemed an Event of Loss) shall be
subject and subordinate to, and any Sublease permitted by this paragraph
(b) shall be expressly subject and subordinate to, all the terms of this
Lease and Lessor's (and so long as the Trust Indenture is in effect, the
Indenture Trustee's (as Lessor's assignee) rights to repossess and to void
such Sublease upon such repossession, and Lessee shall remain primarily
liable hereunder for the performance of all of the terms of this Lease, and
the terms of any such Sublease shall not permit any Sublessee to take any
action not permitted to be taken by Lessee in this Lease with respect to
the Aircraft. No pooling agreement, sublease or other relinquishment of
possession of the Airframe or any Engine or Wet Lease shall in any way
discharge or diminish any of Lessee's obligations to Lessor hereunder or
constitute a waiver of Lessor's rights or remedies hereunder. Lessor
agrees, for the benefit of Lessee (and any Sublessee) and for the benefit
of any mortgagee or other holder of a security interest in any engine
(other than an Engine) owned by Lessee (or any Sublessee), any lessor of
any engine (other than an Engine) leased to Lessee (or any Sublessee) and
any conditional vendor of any engine (other than an Engine) purchased by
Lessee (or any Sublessee) subject to a conditional sale agreement or any
other security agreement, that no interest shall be created hereunder in
any engine so owned, leased or purchased and that none of Lessor, its
successors or assigns will acquire or claim, as against Lessee (or any
Sublessee) or any such mortgagee, lessor or conditional vendor or other
holder of a security interest or any successor or assignee of any thereof,
any right, title or interest in such engine as the result of such engine
being installed on the Airframe.
Any Wet Lease or similar arrangement under which Lessee maintains
operational control of the Aircraft shall not constitute a delivery,
transfer or relinquishment of possession of the Aircraft for purposes of
this section. Lessor acknowledges that any consolidation or merger of
Lessee or conveyance, transfer or lease of all or substantially all of
Lessee's assets otherwise permitted by the Operative Documents shall not be
prohibited by this Section.
(c) Insignia. On or prior to the Delivery Date, or as soon as
practicable thereafter, Lessee agrees to affix and maintain (or cause to be
affixed and maintained), at its expense, in the cockpit of the Airframe
adjacent to the airworthiness certificate therein and on each Engine a
nameplate bearing the inscription:
Leased From
First Security Bank, National Association, as Owner Trustee, Lessor
and, for so long as the Airframe and each Engine shall be subject to the
Lien of the Trust Indenture, bearing the following additional inscription:
Mortgaged To
State Street Bank and Trust Company of Connecticut, National Association,
as Indenture Trustee
(such nameplate to be replaced, if necessary, with a nameplate reflecting
the name of any successor Lessor or successor Indenture Trustee, in each
case as permitted under the Operative Documents). Except as above
provided, Lessee will not allow the name of any Person to be placed on the
Airframe or on any Engine as a designation that might be interpreted as a
claim of ownership; provided that nothing herein contained shall prohibit
Lessee (or any Sublessee) from placing its customary colors and insignia on
the Airframe or any Engine.
Section 8. REPLACEMENT AND POOLING OF PARTS; ALTERATIONS,
MODIFICATIONS AND ADDITIONS.
(a) Replacement of Parts. Lessee, at its own cost and expense,
will promptly replace or cause to be replaced all Parts which may from time
to time be incorporated or installed in or attached to the Airframe or any
Engine and which may from time to time become worn out, lost, stolen,
destroyed, seized, confiscated, damaged beyond repair or permanently
rendered unfit for use for any reason whatsoever, except as otherwise
provided in paragraph (c) of this Section 8 or if the Airframe or an Engine
to which a Part relates has suffered an Event of Loss. In addition, Lessee
(or any Sublessee) may, at its own cost and expense, remove in the ordinary
course of maintenance, service, repair, overhaul or testing, any Parts,
whether or not worn out, lost, stolen, destroyed, seized, confiscated,
damaged beyond repair or permanently rendered unfit for use, provided that
Lessee (or any Sublessee), except as otherwise provided in paragraph (c) of
this Section 8, will, at its own cost and expense, replace such Parts as
promptly as practicable. All replacement Parts shall be free and clear of
all Liens (except for Permitted Liens and pooling arrangements to the
extent permitted by paragraph (b) of this Section 8 and except in the case
of replacement property temporarily installed on an emergency basis) and
shall be in as good operating condition as, and shall have a value and
utility at least equal to, the Parts replaced assuming such replaced Parts
were in the condition and repair required to be maintained by the terms
hereof. Except as otherwise provided in paragraph (c) of this Section 8,
all Parts at any time removed from the Airframe or any Engine shall remain
the property of Lessor, no matter where located, until such time as such
Parts shall be replaced by Parts which have been incorporated or installed
in or attached to the Airframe or such Engine and which meet the
requirements for replacement Parts specified above. Immediately upon any
replacement part becoming incorporated or installed in or attached to the
Airframe or any Engine as above provided, without further act (subject only
to Permitted Liens and any pooling arrangement to the extent permitted by
paragraph (b) of this Section 8 and except in the case of replacement
property temporarily installed on an emergency basis), (i) title to such
replacement Part shall thereupon vest in Lessor, (ii) such replacement Part
shall become subject to this Lease and be deemed part of the Airframe or
such Engine for all purposes hereof to the same extent as the Parts
originally incorporated or installed in or attached to the Airframe or such
Engine, and (iii) title to the replaced Part shall thereupon vest in Lessee
(or, if a Sublease is then in effect, any Sublessee), free and clear of all
rights of Lessor, and shall no longer be deemed a Part hereunder.
(b) Pooling of Parts. Any Part removed from the Airframe or any
Engine as provided in paragraph (a) of this Section 8 may be subjected by
Lessee (or any Sublessee) to a normal pooling arrangement customary in the
airline industry of which Lessee (or, if a Sublease is then in effect, any
Sublessee) is a party entered into in the ordinary course of Lessee's (or
any Sublessee's) business; provided that the Part replacing such removed
Part shall be incorporated or installed in or attached to such Airframe or
Engine in accordance with such paragraph (a) as promptly as practicable
after the removal of such removed Part. In addition, any replacement Part
when incorporated or installed in or attached to the Airframe or any Engine
in accordance with such paragraph (a) may be owned by any third party
subject to such a normal pooling arrangement, provided that Lessee (or any
Sublessee), at its expense, as promptly thereafter as practicable, either
(i) causes title to such replacement Part to vest in Lessor in accordance
with such paragraph (a) by Lessee (or any Sublessee) acquiring title
thereto for the benefit of, and transferring such title to, Lessor free and
clear of all Liens except Permitted Liens (other than pooling arrangements)
or (ii) replaces such replacement Part by incorporating or installing in or
attaching to the Airframe or Engine a further replacement Part owned by
Lessee (or any Sublessee) free and clear of all Liens except Permitted
Liens (other than pooling arrangements) and by causing title to such
further replacement Part to vest in Lessor in accordance with such
paragraph (a).
(c) Alterations, Modifications and Additions. Lessee, at its own
expense, will make (or cause to be made) such alterations and modifications
in and additions to the Airframe and Engines as may be required from time
to time to meet the applicable standards of the FAA or any applicable
regulatory agency or body of any other jurisdiction in which the Aircraft
may then be registered as permitted by Section 7(d) of the Participation
Agreement; provided, however, that Lessee (or, if a Sublease is then in
effect, any Sublessee) may, in good faith, contest the validity or
application of any such law, rule, regulation or order in any reasonable
manner which does not adversely affect Lessor or, so long as any Equipment
Notes are outstanding, the Indenture Trustee. In addition, Lessee (or any
Sublessee), at its own expense, may from time to time add further parts or
accessories and make such alterations and modifications in and additions to
the Airframe or any Engine as Lessee (or any Sublessee) may deem desirable
in the proper conduct of its business, including, without limitation,
removal of Parts which Lessee (or any Sublessee) has determined in its
reasonable judgment to be obsolete or no longer suitable or appropriate for
use on the Airframe or such Engine (such parts, "Obsolete Parts"); provided
that no such alteration, modification or addition shall materially diminish
the value, utility or remaining useful life of the Airframe or such Engine
below the value, utility or remaining useful life thereof immediately prior
to such alteration, modification or addition (it being agreed that the
modification that makes an Engine a [CFM 56-5B-5/P](3) engine shall be deemed
not to diminish the value, utility and remaining useful life of an Engine),
assuming the Airframe or such Engine was then in the condition required to
be maintained by the terms of this Lease, except that the value (but not
the utility or remaining useful life) of the Airframe or any Engine may be
reduced by the value of Obsolete Parts which shall have been removed so
long as the aggregate value of all Obsolete Parts which shall have been
removed and not replaced shall not exceed $350,000 in aggregate value at
the time of removal. Title to all Parts incorporated or installed in or
attached or added to the Airframe or an Engine as the result of such
alteration, modification or addition (except those parts which (x) Lessee
has leased from others and (y) may be removed by Lessee pursuant to the
next sentence (the "Additional Parts")) shall, without further act, vest in
Lessor. Notwithstanding the foregoing sentence, Lessee (or any Sublessee)
may remove or suffer to be removed any Additional Part, provided that such
Additional Part (i) is in addition to, and not in replacement of or
substitution for, any Part originally incorporated or installed in or
attached to the Airframe or any Engine at the time of delivery thereof
hereunder or any Part in replacement of, or substitution for, any such
Part, (ii) is not required to be incorporated or installed in or attached
or added to the Airframe or any Engine pursuant to the terms of Section 7
hereof or the first sentence of this paragraph (c) and (iii) can be removed
from the Airframe or such Engine without diminishing or impairing the
value, utility or remaining useful life which the Airframe or such Engine
would have had at the time of removal had such alteration, modification or
addition not occurred. Upon the removal by Lessee (or Sublessee) of any
Part as provided above, title thereto shall, without further act, vest in
Lessee (or any Sublessee, as the case may be) and such Part shall no longer
be deemed part of the Airframe or Engine from which it was removed. Any
Part not removed by Lessee (or any Sublessee) as above provided prior to
the return of the Airframe or Engine to Lessor hereunder shall remain the
property of Lessor.
(d) Certain Matters Regarding Passenger Convenience Equipment.
Lessee may install on the Airframe, subject to the requirements of Section
8(c) above, Passenger Convenience Equipment that is (i) owned by another
Person and leased to Lessee, (ii) sold to Lessee by another Person subject
to a conditional sale contract or other retained security interest,
(iii) leased to Lessee pursuant to a lease which is subject to a security
interest in favor of another Person or (iv) installed on the Aircraft
subject to a license granted to Lessee by another Person, and in any such
case the Lessor and the Indenture Trustee will not acquire or claim, as
against any such other Person, any right, title or interest in any such
Passenger Convenience Equipment solely as a result of its installation on
the Airframe Lessee agrees that if any such Person repossesses such
Passenger Convenience Equipment, Lessee will (or will cause such Person to)
restore the Aircraft to the condition it would have been in had the
installation of such Passenger Convenience Equipment not occurred.
--------------------
(3) For A319 and A320 Aircraft; A330 Aircraft to be determined.
Section 9. VOLUNTARY TERMINATION.
(a) Termination Event.
(i) Lessee shall have the right to elect to terminate this Lease
(x) on any Lease Period Date occurring on or after the close of the
calendar year in which the seventh (7th) anniversary of the Delivery
Date occurs if Lessee shall have made the good faith determination,
which shall be evidenced by a certificate of a responsible officer of
Lessee, that the Aircraft is obsolete or surplus to its needs or (y) on
the tenth, thirteenth and sixteenth anniversaries of the Delivery Date.
(ii) Lessee shall give to Lessor at least one hundred twenty (120)
days revocable advance written notice of Lessee's intention to so
terminate this Lease (any such notice, a "Termination Notice")
specifying (A) the Lease Period Date on which Lessee intends to
terminate this Lease in accordance with this Section 9 (such specified
date, a "Termination Date"), (B) either (I) that Lessee has determined
that the Aircraft is obsolete or surplus to its needs or (II) that it is
exercising its termination option pursuant to Section 9(a)(i)(y) and (C)
in the case of a Termination under Section 9(a)(i)(y) whether Lessee
elects to purchase the Aircraft pursuant to Section 9(d). Any
Termination Notice shall become irrevocable fifteen (15) days prior to
the Termination Date.
(b) Optional Sale of the Aircraft; Lessor Retention Option;
Revocation of Termination Notice. In the event that Lessee shall have
exercised its right to terminate this Lease under Section 9(a)(i)(y) but
shall not have elected to purchase the Aircraft pursuant to Section 9(d),
or Lessee shall have elected to terminate this Lease pursuant to Section
9(a)(i)(x), then during the period from the giving of the Termination
Notice until the proposed Termination Date (unless Lessee shall have
revoked the Termination Notice specifying such proposed Termination Date or
Lessor shall have irrevocably elected to retain the Aircraft pursuant to
this Section 9(b)), Lessee, as agent for Lessor and at no expense to
Lessor, shall use commercially reasonable efforts to obtain bids for the
purchase of the Aircraft and, in the event it receives any bid, Lessee
shall, within five (5) Business Days after receipt thereof and at least ten
(10) Business Days prior to the proposed Termination Date, certify to
Lessor in writing the amount and terms of such bid, and the name and
address of the party or parties (who shall not be Lessee or any Affiliate
of Lessee or any Person with whom Lessee or any such Affiliate has an
arrangement or understanding regarding the future use of the Aircraft by
Lessee or any such Affiliate but who may be the Owner Participant, any
Affiliate thereof or any Person contacted by the Owner Participant)
submitting such bid. Subject to the next succeeding sentence, on or before
the Termination Date, subject to the release of all mortgage and security
interests with respect to the Aircraft under the Trust Indenture: (1)
Lessee shall deliver the Aircraft, or cause the Aircraft to be delivered,
to the bidder(s), if any, which shall have submitted the highest bid
therefor at least ten (10) Business Days prior to such Termination Date, in
the same manner and in the same condition and otherwise in accordance with
all the terms of this Lease as if delivery were made to Lessor pursuant to
Section 5, and shall duly transfer to Lessor title to any engines not owned
by Lessor all in accordance with the terms of Section 5, (2) Lessor shall
comply with the terms of the Trust Indenture and shall, without recourse or
warranty (except as to the absence of Lessor Liens), subject to prior or
concurrent payment by Lessee of all amounts due under clause (3) of this
sentence, sell all of Lessor's right, title and interest in and to the
Aircraft for cash in Dollars to such bidder(s), the total sales price
realized at such sale to be retained by Lessor, and (3) Lessee shall
simultaneously pay or cause to be paid to Lessor in funds of the type
specified in Section 3(e) hereof, an amount equal to the sum of (A) the
excess, if any, of (i) the Termination Value for the Aircraft, computed as
of the Termination Date, over (ii) the sales price of the Aircraft sold by
Lessor after deducting the reasonable expenses incurred by Lessor in
connection with such sale, (B) all unpaid Basic Rent with respect to the
Aircraft due prior to such Termination Date and, if such Basic Rent is
payable in arrears on such Termination Date as indicated on Exhibit B, on
such Termination Date, and all unpaid Supplemental Rent due on or prior to
the Termination Date with respect to the Aircraft, and (C) the Make-Whole
Amount, if any, due on the Equipment Notes, and upon such payment Lessor
simultaneously will transfer to Lessee, without recourse or warranty
(except as to the absence of Lessor Liens), all of Lessor's right, title
and interest in and to any Engines constituting part of the Aircraft which
were not sold with the Aircraft. Notwithstanding the preceding sentence,
Lessor may, if Lessee has not revoked the Termination Notice, elect to
retain title to the Aircraft. If Lessor so elects, Lessor shall give to
Lessee irrevocable written notice of such election within thirty (30) days
of its receipt of a Termination Notice accompanied by an irrevocable
undertaking by the Owner Participant to make available to the Lessor for
payment to the Indenture Trustee on the Termination Date the amount
required to pay in full the unpaid principal amount of the Equipment Notes
outstanding on the Termination Date plus interest accrued thereon through
the Termination Date together with the Make-Whole Amount, if any, due on
the Equipment Notes, if the same is not otherwise paid. Upon receipt of
notice of such an election by Lessor and the accompanying undertaking by
the Owner Participant, Lessee shall cease its efforts to obtain bids as
provided above and shall reject all bids theretofore or thereafter
received. On the Termination Date, Lessor shall (subject to the payment by
Lessee of all Rent due on or prior to such date as set forth below) pay in
full the unpaid principal amount of the Equipment Notes outstanding on the
Termination Date plus interest accrued thereon through the Termination Date
together with all Make-Whole Amount, if any, due on the Equipment Notes
and, so long as the Equipment Notes are paid as aforesaid, Lessee shall
deliver the Airframe and Engines or engines to Lessor in accordance with
Section 5 and shall pay all Basic Rent due prior to the Termination Date
and, if such Basic Rent is payable in arrears on such Termination Date as
indicated on Exhibit B, on such Termination Date, and all Supplemental Rent
(other than Make-Whole Amount or Termination Value) due on or prior to the
Termination Date. If no sale shall have occurred on the Termination Date
and Lessor has not made the payment contemplated by the preceding sentence
and thereby caused this Lease to terminate, or if Lessee revokes its
Termination Notice, this Lease shall continue in full force and effect as
to the Aircraft, Lessee shall pay the reasonable costs and expenses
incurred by the Owner Participant and Lessor (unless such failure to
terminate the Lease is a consequence of the failure of Lessor or the Owner
Participant without due cause to make, or cause to be made, the payment
referred to in the immediately preceding sentence, in which case Lessor and
the Owner Participant shall be responsible for damages), if any, in
connection with preparation for such sale and Lessee may give one or more
additional Termination Notices in accordance with Section 9(a), subject to
the last sentence of this Section 9(b). In the event of any such sale or
such retention of the Aircraft by Lessor and upon compliance by Lessee with
the provisions of this paragraph, the obligation of Lessee to pay Basic
Rent or any other amounts hereunder shall cease to accrue and this Lease
shall terminate. Lessor may, but shall be under no duty to, solicit bids,
inquire into the efforts of Lessee to obtain bids or otherwise take any
action in connection with any such sale other than to transfer (in
accordance with the foregoing provisions) to the purchaser named in the
highest bid certified by Lessee to Lessor all of Lessor's right, title and
interest in the Aircraft, against receipt of the payments provided herein.
Lessee may revoke a Termination Notice given pursuant to Section 9(a) no
more than [two (2)] times during the Term.
(c) Termination as to Engines; Replacement. Lessee shall have the
right at its option at any time during the Term, on at least thirty (30)
days prior written notice, to terminate this Lease with respect to any
Engine. In such event, and prior to the date of such termination, Lessee
shall replace such Engine hereunder by complying with the terms of Section
10(b) to the same extent as if an Event of Loss had occurred with respect
to such Engine, and Lessor shall transfer such right, title and interest as
it may have to the replaced Engine as provided in Section 5(b). No
termination of this Lease with respect to any Engine as contemplated by
this Section 9(c) shall result in any reduction of Basic Rent.
(d) Special Purchase Options. If Lessee exercises its right to
terminate this Lease under Section 9(a)(1)(y), gives its notice pursuant to
Section 9(a)(ii) to purchase the Aircraft pursuant to this Section 9(d) and
such notice becomes irrevocable, then on the Termination Date specified in
Section 9(a), Lessee shall purchase the Aircraft at the greater of (i) the
Termination Value on the Termination Date, or (ii) its fair market sales
value on the Termination Date (determined in accordance with Section 19(c)
hereof), provided that Lessee shall have also paid the amounts specified in
(A) and (B) of the following sentence. In such event, Lessor shall,
without recourse or warranty (except as to the absence of Lessor Liens),
sell the Aircraft to Lessee in exchange for the payment in immediately
available funds in an amount equal to the greater of (x) the Termination
Value for the Aircraft, computed as of the Termination Value Date, or (y)
the fair market sales value of the Aircraft on the Termination Date,
provided that on such date the Lessee shall have also paid to the Lessor
the sum of (A) all unpaid Basic Rent with respect to the Aircraft due on or
prior to such Termination Date (other than Basic Rent payable in advance
and due on the Termination Date) and all unpaid Supplemental Rent with
respect to the Aircraft due on or prior to such Termination Date plus (B)
all reasonable expenses incurred by Lessor and the Owner Participant in
connection with such sale. Upon payment in full of the amounts required to
be paid and the performance of all acts required to be performed by Lessee
pursuant to the preceding sentence, (i) the obligation of Lessee to pay
Basic Rent hereunder with respect to the Aircraft for any period commencing
on or after the Termination Date shall terminate with respect to the
Aircraft, (ii) this Lease shall terminate on the Termination Date, (iii)
Lessor will transfer to or at the direction of Lessee, without recourse or
warranty (except as to the absence of Lessor Liens), all of Lessor's right,
title and interest in the Airframe and Engines and furnish to or at the
direction of the Lessee a bill of sales in form and substance reasonably
satisfactory to Lessee, evidencing such transfer. Notwithstanding the
foregoing, Lessee may, in accordance with Section 7(u) of the Participation
Agreement, assume the principal amount of the Equipment Notes then
outstanding on any Termination Date specified in Section 9(a), in which
event the Lessee will receive a credit against the purchase price otherwise
payable pursuant to this Section 9(d) in an amount equal to the principal
amount of Equipment Notes so assumed.
Section 10. LOSS, DESTRUCTION, REQUISITION, ETC.
(a) Event of Loss with Respect to the Aircraft. Upon the
occurrence of an Event of Loss with respect to the Airframe or the Airframe
and the Engines and/or engines then installed thereon, Lessee shall
forthwith (and in any event, within fifteen (15) days after such
occurrence) give Lessor written notice of such Event of Loss, and, within
sixty (60) days after such Event of Loss, Lessee shall give Lessor written
notice of its election to perform one of the following options (it being
agreed that if Lessee shall not have given such notice of election within
such period, Lessee shall be deemed to have elected the option set forth in
clause (i) below). Lessee may elect either to:
(i) make the payments specified in this clause
(i), in which event not later than the earlier of (x) the Business Day
next succeeding the 120th day following the occurrence of such Event
of Loss or (y) an earlier Business Day irrevocably specified fifteen
(15) days in advance by notice from Lessee to Lessor and the Indenture
Trustee (the "Loss Payment Date"), Lessee shall pay or cause to be
paid to Lessor in funds of the type specified in Section 3(e) hereof,
an amount equal to the Termination Value of the Aircraft corresponding
to the Termination Value Date occurring on or immediately following
the Loss Payment Date (the "Determination Date"); provided that in any
instance in which the applicable Loss Payment Date shall occur after
the final day of the Term, the Determination Date shall be the last
Termination Value Date in the Term, and the Termination Value shall be
reduced by any amount of Basic Rent due on the Determination Date that
has actually been paid;
(ii) substitute an aircraft or an airframe or an
airframe and one or more engines, as the case may be; provided that,
if Lessee does not perform its obligation to effect such substitution
in accordance with this Section 10(a), during the period of time
provided herein, then Lessee shall pay or cause to be paid to Lessor
on the Business Day next succeeding the 120th day following the
occurrence of such Event of Loss the amount specified in clause (i)
above.
At such time as Lessor shall have received the amounts specified in
clause (i) above, together with all other amounts that then may be due
hereunder (including, without limitation, all Basic Rent due before the
date of such payment and all Supplemental Rent), under the Participation
Agreement and under the Tax Indemnity Agreement, (1) the obligation of
Lessee to pay the installments of Basic Rent shall cease to accrue, (2)
this Lease shall terminate, (3) Lessor will comply with the terms of the
Trust Indenture and transfer to or at the direction of Lessee, without
recourse or warranty (except as to the absence of Lessor Liens), all of
Lessor's right, title and interest in and to the Airframe and any Engines
subject to such Event of Loss, as well as any Engines not subject to such
Event of Loss, and furnish to or at the direction of Lessee a bill of sale
in form and substance reasonably satisfactory to Lessee (or any Sublessee),
evidencing such transfer, and (4) Lessee will be subrogated to all claims
of Lessor, if any, against third parties, for damage to or loss of the
Airframe and any Engines which were subject to such Event of Loss to the
extent of the then insured value of the Aircraft.
In the event Lessee shall elect to substitute an aircraft (or an
airframe or an airframe and one or more engines, as the case may be) Lessee
shall, at its sole expense, not later than the Business Day next succeeding
the 120th day following the occurrence of such Event of Loss, (A) convey or
cause to be conveyed to Lessor and to be leased by Lessee hereunder, an
aircraft (or an airframe or an airframe and one or more engines which,
together with the Engines constituting a part of the Aircraft but not
installed thereon at the time of such Event of Loss constitute the
Aircraft) free and clear of all Liens (other than Permitted Liens) and
having a value, utility and remaining useful life at least equal to the
Aircraft subject to such Event of Loss assuming that the Aircraft had been
maintained in accordance with this Lease and (B) prior to or at the time of
any such substitution, Lessee (or any Sublessee), at its own expense, will
(1) furnish Lessor with a full warranty bill of sale and a Federal Aviation
Administration bill of sale, in form and substance reasonably satisfactory
to Lessor, evidencing such transfer of title, (2) cause a Lease Supplement
and a Trust Supplement to be duly executed by Lessee and filed for
recording pursuant to the Transportation Code, or the applicable laws,
rules and regulations of any other jurisdiction in which the Airframe may
then be registered as permitted by Section 7(d) of the Participation
Agreement, (3) cause a financing statement or statements with respect to
such substituted property to be filed in such place or places as are deemed
necessary or desirable by Lessor to perfect its and the Indenture Trustee's
interest therein and herein, (4) furnish Lessor with such evidence of
compliance with the insurance provisions of Section 11 with respect to such
substituted property as Lessor may reasonably request, (5) furnish Lessor
with copies of the documentation required to be provided by Lessee pursuant
to Section 5.06 of the Trust Indenture, and Lessor simultaneously will
comply with the terms of the Trust Indenture and transfer to or at the
direction of Lessee, without recourse or warranty (except as to the absence
of Lessor Liens), all of Lessor's right, title and interest, if any, in and
to the Aircraft or the Airframe and one or more Engines, as the case may
be, with respect to which such Event of Loss occurred and furnish to or at
the direction of Lessee a bill of sale in form and substance reasonably
satisfactory to Lessee (or any Sublessee), evidencing such transfer, (6)
furnish Lessor with an opinion of counsel (which shall be Skadden, Arps,
Slate, Meagher & Flom LLP or Skadden, Arps, Slate, Meagher & Flom
(Illinois) and, if not, other counsel chosen by Lessee and reasonably
acceptable to Lessor) reasonably satisfactory to Lessor to the effect that
Lessor and the Indenture Trustee will be entitled to the benefits of
Section 1110 of the U.S. Bankruptcy Code with respect to the substitute
aircraft, provided that such opinion need not be delivered to the extent
that immediately prior to such substitution the benefits of Section 1110 of
the U.S. Bankruptcy Code were not, solely by reason of a change in law or
governmental interpretation thereof after the date hereof, available to
Lessor and, so long as any Equipment Notes are outstanding, the Indenture
Trustee (it being agreed that such opinion may contain customary
qualifications and assumptions) and (7) Lessee will be subrogated to all
claims of Lessor, if any, against third parties for damage to or loss of
the Airframe and any Engine which were subject to such Event of Loss to the
extent of the then insured value of the Aircraft. For all purposes hereof,
the property so substituted shall after such transfer be deemed part of the
property leased hereunder and shall be deemed an "Aircraft", "Airframe" and
"Engine", as the case may be, as defined herein. No Event of Loss with
respect to the Airframe or the Airframe and the Engines or engines then
installed thereon for which substitution has been elected pursuant to
Section 10(a)(ii) hereof shall result in any reduction in Basic Rent.
(b) Event of Loss with Respect to an Engine. Upon the occurrence
of an Event of Loss with respect to an Engine under circumstances in which
there has not occurred an Event of Loss with respect to the Airframe,
Lessee shall forthwith (and in any event, within fifteen days after such
occurrence) give Lessor written notice thereof and shall, within one
hundred twenty (120) days after the occurrence of such Event of Loss,
convey or cause to be conveyed to Lessor, as replacement for the Engine
with respect to which such Event of Loss occurred, title to an Acceptable
Alternate Engine. Prior to or at the time of any such conveyance, Lessee,
at its own expense, will (i) furnish Lessor with a warranty (as to title)
bill of sale, in form and substance reasonably satisfactory to Lessor, with
respect to such Acceptable Alternate Engine, (ii) cause a Lease Supplement
and Trust Supplement to be duly executed by Lessee and to be filed for
recording pursuant to the Transportation Code, or the applicable laws,
rules and regulations of any other jurisdiction in which the Airframe may
then be registered as permitted by Section 7(d) of the Participation
Agreement, (iii) furnish Lessor with such evidence of compliance with the
insurance provisions of Section 11 hereof with respect to such replacement
engine as Lessor may reasonably request and furnish Lessor with copies of
the documentation required to be provided by Lessee pursuant to Section
5.06 of the Trust Indenture, and Lessor will comply with the terms of the
Trust Indenture and transfer to or at the direction of Lessee without
recourse or warranty (except as to absence of Lessor Liens) all of Lessor's
right, title and interest, if any, in and to (A) the Engine with respect to
which such Event of Loss occurred and furnish to or at the direction of
Lessee a bill of sale in form and substance reasonably satisfactory to
Lessee, evidencing such transfer and (B) all claims, if any, against third
parties, for damage to or loss of the Engine subject to such Event of Loss,
and such Engine shall thereupon cease to be the Engine leased hereunder.
For all purposes hereof, each such replacement engine shall, after such
conveyance, be deemed part of the property leased hereunder, and shall be
deemed an "Engine". No Event of Loss with respect to an Engine under the
circumstances contemplated by the terms of this paragraph (b) shall result
in any reduction in Basic Rent.
(c) Application of Payments from Governmental Authorities for
Requisition of Title, etc. Any payments (other than insurance proceeds the
application of which is provided for in Section 11) received at any time by
Lessor or by Lessee from any governmental authority or other Person with
respect to an Event of Loss will be applied as follows:
(i) if payments are received with respect to the
Airframe (or the Airframe and any Engine or engines then installed
thereon), (A) unless the same are replaced pursuant to the last
paragraph of Section 10(a), after reimbursement of Lessor (as provided
in Section 7.01 of the Trust Agreement) for reasonable costs and
expenses, so much of such payments remaining as shall not exceed the
Termination Value required to be paid by Lessee pursuant to Section
10(a), shall be applied in reduction of Lessee's obligation to pay
Termination Value, if not already paid by Lessee, or, if already paid
by Lessee, shall be applied to reimburse Lessee for its payment of
Termination Value, and following the foregoing application, the
balance, if any, of such payments will be paid over to, or retained by
Lessee, provided that Lessor shall be entitled to so much of the
excess, if any, of such payment over the greater of (x) the
Termination Value and (y) the fair market value of the Aircraft as
Lessor shall demonstrate to Lessee's reasonable satisfaction is
attributable to compensation for loss of Lessor's interest in the
Aircraft as distinguished from the loss of use of the Aircraft; or (B)
if such property is replaced pursuant to the last paragraph of Section
10(a), such payments shall be paid over to, or retained by, Lessee;
and
(ii) if such payments are received with respect to
an Engine under circumstances contemplated by Section 10(b) hereof, so
much of such payments remaining after reimbursement of Lessor (as
provided for in Section 7.01 of the Trust Agreement) for reasonable
costs and expenses shall be paid over to, or retained by, Lessee.
(d) Requisition for Use of the Aircraft by the United States
Government or the Government of Registry of the Aircraft. In the event of
the requisition for use of the Airframe and the Engines or engines
installed on the Airframe during the Term by the United States Government
or any other government of registry of the Aircraft or any instrumentality
or agency of any thereof, Lessee shall promptly notify Lessor of such
requisition, and all of Lessee's obligations under this Lease with respect
to the Aircraft shall continue to the same extent as if such requisition
had not occurred (except to the extent that any failure or delay in
repairing or maintaining the Aircraft shall have been caused by such
requisition), provided that if such Airframe and Engines or engines
installed thereon are not returned by such government prior to the end of
the Term, Lessee shall be obligated to return the Airframe and such Engines
or engines to Lessor pursuant to, and in all other respects in compliance
with the provisions of, Section 5 promptly on the date of such return by
such government. If, in the event of any such requisition, Lessee shall
fail to return the Aircraft on or before the thirtieth (30th) day beyond
the end of the Term, such failure shall constitute an Event of Loss which
shall be deemed to have occurred on the last day of the Term and in such
event Lessee shall make the payment contemplated by Section 10(a)(i) in
respect of such Event of Loss; provided, however, that Lessor may notify
Lessee in writing on or before the twentieth (20th) day prior to the last
day of the Term that, in the event Lessee shall fail by reason of such
requisition to return the Airframe and such Engines or engines on or before
the thirtieth day beyond the end of the Term, such failure shall not be
deemed an Event of Loss. Upon the giving of such notice and such failure
to return by the thirtieth (30th) day beyond the end of the Term, Lessee
shall be relieved of all of its obligations pursuant to the provisions of
Section 5 (but not under any other Section), except that if any engine not
owned by Lessor shall then be installed on the Airframe, Lessee will, at no
cost to Lessor, furnish, or cause to be furnished, to Lessor a full
warranty (as to title) bill of sale with respect to each such engine, in
form and substance reasonably satisfactory to Lessor (together with an
opinion of counsel (which may be Lessee's General Counsel, Deputy General
Counsel, Assistant General Counsel or Associate General Counsel) to the
effect that such full warranty bill of sale has been duly authorized and
delivered and is enforceable in accordance with its terms and that such
engines are free and clear of Liens other than Lessor Liens, Loan
Participant Liens and Indenture Trustee Liens), against receipt from Lessor
of a bill of sale evidencing the transfer, without recourse or warranty
(except as to the absence of Lessor Liens), by Lessor to Lessee or its
designee of all of Lessor's right, title and interest in and to any Engine
constituting part of the Aircraft but not then installed on the Airframe.
All payments received by Lessor or Lessee from such government for the use
of such Airframe and Engines or engines during the Term shall be paid over
to, or retained by, Lessee (or, if directed by Lessee, any Sublessee); and
all payments received by Lessor or Lessee from such government for the use
of such Airframe and Engines or engines after the end of the Term shall be
paid over to, or retained by, Lessor unless Lessee shall have exercised its
purchase option hereunder, in which case such payments shall be made to
Lessee.
(e) Requisition for Use of an Engine by the United States
Government or the Government of Registry of the Aircraft. In the event of
the requisition for use of an Engine by the United States Government or any
other government of registry of the Aircraft or any agency or
instrumentality of any thereof (other than in the circumstances
contemplated by paragraph (d)), Lessee shall replace such Engine hereunder
by complying (or causing any Sublessee to comply) with the terms of Section
10(b) to the same extent as if an Event of Loss had occurred with respect
thereto, and, upon compliance with Section 10(b) hereof, any payments
received by Lessor or Lessee from such government with respect to such
requisition shall be paid over to, or retained by, Lessee.
(f) Application of Payments During Existence of Event of Default.
Any amount referred to in this Section 10 which is payable to or retainable
by Lessee (or any Sublessee) shall not be paid to or retained by Lessee (or
such Sublessee) if at the time of such payment or retention an Event of
Default has occurred and is continuing, but shall be held by or paid over
to Lessor as security for the obligations of Lessee (or such Sublessee)
under this Lease and, if an Event of Default has occurred and is continuing
hereunder, applied against Lessee's obligations hereunder as and when due.
At such time as there shall not be continuing any such Event of Default,
such amount shall be paid to Lessee (or such Sublessee) to the extent not
previously applied in accordance with the preceding sentence.
Section 11. INSURANCE.
(a) Lessee's Obligation to Insure. Lessee shall comply with, or
cause to be complied with, each of the provisions of Exhibit H, which
provisions are hereby incorporated by this reference as if set forth in
full herein.
(b) Additional Insurance by Lessor and Lessee. Lessee (and any
Sublessee) may at its own expense carry insurance with respect to its
interest in the Aircraft in amounts in excess of that required to be
maintained by this Section 11; the Owner Participant may carry for its own
account at its sole cost and expense insurance with respect to its interest
in the Aircraft, provided that such insurance does not prevent Lessee (or
any Sublessee) from carrying the insurance required or permitted by this
Section 11 or adversely affect such insurance or the cost thereof.
(c) Indemnification by Government in Lieu of Insurance.
Notwithstanding any provisions of this Section 11 requiring insurance,
Lessor agrees to accept, in lieu of insurance against any risk with respect
to the Aircraft, indemnification from, or insurance provided by, the United
States Government or any agency or instrumentality thereof, or, upon the
written consent of Lessor, other government of registry of the Aircraft or
agency or instrumentality thereof, against such risk in an amount which,
when added to the amount of insurance against such risk maintained by
Lessee (or any Sublessee) shall be at least equal to the amount of
insurance against such risk otherwise required by this Section 11 (taking
into account self-insurance permitted by Exhibit H hereto).
(d) Application of Payments During Existence of an Event of
Default. Any amount referred to in paragraph (b) of Exhibit H hereto which
is payable to or retainable by Lessee (or any Sublessee) shall not be paid
to or retained by Lessee (or any Sublessee) if at the time of such payment
or retention an Event of Default has occurred and is continuing, but shall
be held by or paid over to Lessor as security for the obligations of Lessee
under this Lease and, if Lessor declares this Lease to be in default
pursuant to Section 15 hereof, applied against Lessee's obligations
hereunder as and when due. At such time as there shall not be continuing
any such Event of Default, such amount shall be paid to Lessee to the
extent not previously applied in accordance with the preceding sentence.
Section 12. INSPECTION. At all reasonable times and upon at
least 15 days prior written notice to Lessee, the Owner Participant or the
Indenture Trustee, or their respective authorized representatives, may
inspect the Aircraft and inspect and make copies of the books and records
of Lessee and any Sublessee required to be maintained by the Federal
Aviation Administration or the regulatory agency or body of another
jurisdiction in which the Aircraft is then registered relating to the
maintenance of the Aircraft (at Lessor's, the Owner Participant's or the
Indenture Trustee's risk and expense, as the case may be) and shall keep
any information or copies obtained thereby confidential and shall not
disclose the same to any Person, except (A) to the Lessor, the Note Holders
and to prospective and permitted transferees of Lessor's, the Owner
Participant's, the Note Holders' or the Indenture Trustee's interest (and
such prospective and permitted transferee's counsel, independent insurance
advisors or other agents) who agree to hold such information confidential,
(B) to Lessor's, the Owner Participant's, the Note Holders' or the
Indenture Trustee's counsel, independent insurance advisors or other agents
who agree to hold such information confidential, or (C) as may be required
by any statute, court or administrative order or decree or governmental
ruling or regulation, provided, however, that any and all disclosures
permitted by clause (C) above shall be made only to the extent necessary to
meet the specific requirements or needs of the Persons for whom such
disclosures are hereby permitted. Any such inspection of the Aircraft
shall be subject to Lessee's safety and security rules applicable to the
location of the Aircraft, shall be a visual, walk-around inspection of the
interior and exterior of the Aircraft and shall not include opening any
panels, bays or the like without the express consent of Lessee (except in
connection with a heavy maintenance visit when a panel, bay or the like is
scheduled or required to be opened), which consent Lessee may in its sole
discretion withhold; provided that no exercise of such inspection right
shall interfere with the normal operation or maintenance of the Aircraft
by, or the business of, Lessee (or any Sublessee). Upon receipt by Lessee
of a written request from the Owner Participant specifying that the Owner
Participant desires to have an authorized representative observe the next
scheduled heavy maintenance visit to be performed on the Aircraft during
the Term, Lessee shall cooperate with the Owner Participant to enable the
Owner Participant's representative to observe such scheduled maintenance to
be performed on the Aircraft during the Term; provided that the Owner
Participant's authorized representative shall merely observe such scheduled
heavy maintenance visit, shall not interfere with or extend in any manner
the normal conduct or duration of the scheduled heavy maintenance visit,
and shall not be entitled to direct any of the work performed in connection
with such scheduled heavy maintenance visit. Neither the Owner Participant
nor the Indenture Trustee shall have any duty to make any such inspection
nor shall either of them incur any liability or obligation by reason of not
making such inspection. Except during the final six (6) months of the Term
or during the continuance of an Event of Default, all inspections by the
Owner Participant and its authorized representatives or the Indenture
Trustee and its authorized representatives provided for under this Section
12 shall, in regard to each of the Owner Participant and the Indenture
Trustee, be limited to one (1) inspection of any kind contemplated by this
Section 12 during any calendar year. During the last three months of the
Term (unless Lessee shall have elected to purchase the Aircraft or renew
this Lease in accordance with the terms of this Lease), with reasonable
notice, Lessee will cooperate and cause any Sublessee to cooperate, at
Lessor's sole cost, in all reasonable respects with the efforts of Lessor
to sell or lease the Aircraft, including, without limitation, permitting
prospective purchasers or lessees to inspect the Aircraft, any maintenance
records relating to the Aircraft then required to be retained by the FAA or
by the comparable government of registry of the Aircraft, all in accordance
with the provisions set forth above; provided that any such cooperation
shall not interfere with the normal operation or maintenance of the
Aircraft by, or the business of, Lessee or any Sublessee.
Section 13. ASSIGNMENT. Except as otherwise provided herein,
Lessee will not, without prior written consent of Lessor, assign in whole
or in part any of its rights or obligations hereunder. Lessor agrees that
it will not assign or convey its right, title and interest in and to this
Lease or the Aircraft except as provided herein, in the Trust Indenture,
the Trust Agreement, in the Participation Agreement or in any other
Operative Document. Subject to the foregoing, the terms and provisions of
this Lease shall be binding upon and inure to the benefit of Lessor and
Lessee and their respective successors and permitted assigns.
Section 14. EVENTS OF DEFAULT. Each of the following events
shall constitute an Event of Default (whether any 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) and each such Event of Default shall continue so long
as, but only as long as, it shall not have been remedied:
(a) Lessee shall not have made a payment of (i) Basic Rent within
five (5) Business Days after the same shall have become due or (ii)
Termination Value within ten (10) Business Days after receipt by Lessee of
written notice that the same is past due; or
(b) Lessee shall have failed to make a payment of Supplemental
Rent (other than Termination Value) after the same shall have become due
and such failure shall continue for thirty (30) days after Lessee's receipt
of written demand therefor by the party entitled thereto (provided that any
failure to pay any amount owed by Lessee under the Tax Indemnity Agreement
or any failure of Lessee to pay to Lessor or the Owner Participant when due
any Excluded Payments shall not constitute an Event of Default unless
notice is given by the Owner Participant to Lessee and the Indenture
Trustee that such failure shall constitute an Event of Default); or
(c) Lessee shall have failed to perform or observe (or caused to
be performed and observed) in any material respect any covenant or
agreement (except the covenants set forth in the Tax Indemnity Agreement)
to be performed or observed by it under any Operative Document, and such
failure shall continue unremedied for a period of thirty (30) days after
receipt by Lessee of written notice thereof from Lessor or the Indenture
Trustee; provided, however, that if Lessee shall have undertaken to cure
any such failure and, notwithstanding the diligence of Lessee in attempting
to cure such failure, such failure is not cured within said thirty (30) day
period but is curable with future due diligence, there shall exist no Event
of Default under this Section 14 so long as Lessee is proceeding with due
diligence to cure such failure and such failure is remedied not later than
three hundred sixty (360) days after receipt by Lessee of such written
notice; or
(d) any representation or warranty made by Lessee herein or in the
Participation Agreement or any document or certificate furnished by Lessee
in connection herewith or therewith or pursuant hereto or thereto (except
the representations and warranties set forth in the Tax Indemnity Agreement
and such documents or certificates as are furnished to the Owner
Participant solely in connection with matters dealt with in the Tax
Indemnity Agreement and for no other purpose and except for representations
or warranties contained in the Pass Through Trust Agreement, the
Underwriting Agreement, the Class C Purchase Agreement or any document or
instrument furnished pursuant to either thereof) shall prove to have been
incorrect in any material respect at the time made, shall remain material
at the time in question and such incorrectness shall not have been cured
(to the extent of the adverse impact of such incorrectness on the interests
of the Owner Participant, Lessor or the Note Holders) within thirty (30)
days after the receipt by Lessee of a written notice from Lessor or the
Indenture Trustee advising Lessee of the existence of such incorrectness;
or
(e) the commencement of an involuntary case or other proceeding in
respect of Lessee in an involuntary case under the federal bankruptcy laws,
as now or hereafter constituted, or any other applicable federal or state
bankruptcy, insolvency or other similar law in the United States or seeking
the appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of Lessee or for all or substantially
all of its property, or seeking the winding-up or liquidation of its
affairs and the continuation of any such case or other proceeding
undismissed and unstayed for a period of ninety (90) consecutive days or an
order, judgment or decree shall be entered in any proceeding by any court
of competent jurisdiction appointing, without the consent of Lessee, a
receiver, trustee or liquidator of Lessee, or of any substantial part of
its property, or sequestering any substantial part of the property of
Lessee and any such order, judgment or decree or appointment or
sequestration shall be final or shall remain in force undismissed, unstayed
or unvacated for a period of ninety (90) days after the date of entry
thereof; or
(f) the commencement by Lessee of a voluntary case under the
federal bankruptcy laws, as now constituted or hereafter amended, or any
other applicable federal or state bankruptcy, insolvency or other similar
law in the United States, or the consent by Lessee to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) of Lessee or for all or
substantially all of its property, or the making by Lessee of any
assignment for the benefit of creditors, or Lessee shall take any corporate
action to authorize any of the foregoing; or
(g) Lessee shall fail to carry and maintain on or with respect to
the Aircraft (or cause to be carried and maintained) insurance required to
be maintained in accordance with the provisions of Section 11 hereof;
provided, however, that, notwithstanding anything to the contrary contained
in Section 14(c) or (d) hereof, any failure of Lessee to perform or observe
any covenant, condition, agreement or any error in a representation or
warranty shall not constitute an Event of Default if such failure or error
is caused solely by reason of an event that constitutes an Event of Loss so
long as Lessee is continuing to comply with all of the terms of Section 10
hereof.
Section 15. REMEDIES. Upon the occurrence of any Event of
Default and at any time thereafter so long as the same shall be continuing,
Lessor may, at its option, declare by written notice to Lessee this Lease
to be in default; and at any time thereafter, so long as any such
outstanding Events of Default shall not have been remedied, Lessor may do
one or more of the following with respect to all or any part of the
Airframe and any or all of the Engines as Lessor in its sole discretion
shall elect, to the extent permitted by, and subject to compliance with any
mandatory requirements of, applicable law then in effect; provided,
however, that during any period the Aircraft is subject to the Civil
Reserve Air Fleet Program in accordance with the provisions of Section 7(b)
hereof and in possession of the United States government or an agency or
instrumentality of the United States, Lessor shall not, on account of any
Event of Default, be entitled to do any of the following in such manner as
to limit Lessee's control under this Lease (or any Sublessee's control
under any Sublease) of any Airframe or any Engines installed thereon,
unless at least sixty (60) days (or such lesser period as may then be
applicable under the Air Mobility Command program of the United States
Government) written notice of default hereunder shall have been given by
Lessor by registered or certified mail to Lessee (and any Sublessee) with a
copy addressed to the Contracting Office Representative for the Air
Mobility Command of the United States Air Force under any contract with
Lessee (or any Sublessee) relating to the Aircraft:
(a) upon the written demand of Lessor and at Lessee's expense,
cause Lessee to return promptly, and Lessee shall return promptly, the
Airframe or any Engine as Lessor may so demand to Lessor or its order in
the manner and condition required by, and otherwise in accordance with all
the provisions of, Section 5 as if such Airframe or Engine were being
returned at the end of the Term, or Lessor, at its option, may enter upon
the premises where all or any part of the Airframe or any Engine is located
and take immediate possession of and remove the same by summary proceedings
or otherwise (and/or, at Lessor's option, store the same at Lessee's
premises until disposal thereof by Lessor), all without liability accruing
to Lessor for or by reason of such entry or taking of possession or
removing whether for the restoration of damage to property caused by such
action or otherwise;
(b) sell the Airframe and/or any Engine at public or private sale,
as Lessor may determine, or otherwise dispose of, hold, use, operate, lease
to others or keep idle the Aircraft as Lessor, in its sole discretion, may
determine, all free and clear of any rights of Lessee, except as
hereinafter set forth in this Section 15;
(c) whether or not Lessor shall have exercised, or shall
thereafter at any time exercise, any of its rights under paragraph (a) or
paragraph (b) above with respect to the Airframe and/or any Engine, Lessor,
by written notice to Lessee specifying a payment date which shall be the
Lease Period Date not earlier than ten (10) days from the date of such
notice, may demand that Lessee pay to Lessor, and Lessee shall pay Lessor,
on the payment date so specified, as liquidated damages for loss of a
bargain and not as a penalty (in lieu of the installments of Basic Rent for
the Aircraft due for Lease Periods commencing on or after the Lease Period
Date specified as the payment date in such notice), any unpaid Basic Rent
due on Lease Period Dates prior to the payment date so specified
(including, without limitation, any adjustments to Basic Rent payable
pursuant to Section 3(c)) plus whichever of the following amounts Lessor,
in its sole discretion, shall specify in such notice (together with
interest, if any, on such amount at the Past Due Rate from such specified
payment date until the date of actual payment of such amount): (i) an
amount equal to the excess, if any, of the Termination Value for the
Aircraft, computed as of the Lease Period Date specified as the payment
date in such notice, over the aggregate fair market rental value (computed
as hereafter in this Section 15 provided) of such Aircraft for the
remainder of the Term, after discounting such aggregate fair market rental
value to present value as of the Lease Period Date specified as the payment
date in such notice at an annual rate equal to the Past Due Rate; or (ii)
an amount equal to the excess, if any, of the Termination Value for such
Aircraft, computed as of the Lease Period Date specified as the payment
date in such notice over the fair market sales value of such Aircraft
(computed as hereafter in this Section provided) as of the Lease Period
Date specified as the payment date in such notice;
(d) in the event Lessor, pursuant to paragraph (b) above, shall
have sold the Airframe and/or any Engine, Lessor, in lieu of exercising its
rights under paragraph (c) above with respect to such Aircraft, may, if it
shall so elect, demand that Lessee pay Lessor, and Lessee shall pay to
Lessor, on the date of such sale, as liquidated damages for loss of a
bargain and not as a penalty (in lieu of the installments of Basic Rent for
the Aircraft due on or after such date), any unpaid Basic Rent with respect
to the Aircraft due prior to such date (including, without limitation, any
adjustments to Basic Rent payable pursuant to Section 3(c)) plus the amount
of any deficiency between the net proceeds of such sale (after deduction of
all reasonable costs of sale) and the Termination Value of such Aircraft,
computed as of the Termination Date on or immediately following the date of
such sale together with interest, if any, on the amount of such deficiency,
at the Past Due Rate, from the date of such sale to the date of actual
payment of such amount; and/or
(e) Lessor may rescind this Lease as to the Aircraft, and/or may
exercise any other right or remedy which may be available to it under
applicable law or proceed by appropriate court action to enforce the terms
hereof or to recover damages for breach hereof.
For the purposes of paragraph (c) above, the "fair market rental
value" or the "fair market sales value" of the Aircraft shall be the rental
value or sales value, as the case may be, which would be obtained in an
arm's-length transaction between an informed and willing lessee or
purchaser, as the case may be, under no compulsion to lease or purchase, as
the case may be, and an informed and willing lessor or seller in possession
under no compulsion to lease, sell, as the case may be, in each case based
upon the actual condition and location of the Aircraft, which value shall
be determined by mutual agreement or, in the absence of mutual written
agreement, pursuant to an appraisal prepared and delivered by a nationally
recognized firm of independent aircraft appraisers nominated by Lessor, and
Lessor shall immediately notify Lessee of such nomination. Unless Lessee
shall have objected in writing within ten (10) Business Days after its
receipt of Lessor's notice, Lessor's nomination shall be conclusive and
binding. If Lessee shall object, however, Lessor and Lessee shall
endeavor, within ten (10) Business Days after such objection is made, to
select a mutually acceptable appraiser; provided that, if Lessee shall not
so endeavor to make such selection, Lessor's nomination referred to in the
preceding sentence hereof shall be conclusive and binding. If Lessor and
Lessee fail to reach agreement (except for the reason referred to in the
proviso in the preceding sentence), or if any appraiser selected fails to
act for any reason, then the question shall be determined by an appraisal
(applying the definitions of "fair market rental value" and "fair market
sales value" as set forth above based upon the actual condition of the
Aircraft) mutually agreed to by two (2) recognized independent aircraft
appraisers, one of which appraisers shall be chosen by Lessor and one by
Lessee within five (5) Business Days after Lessor or Lessee shall have
received written notice from the other party of a demand that such an
appraisal be made, which notice shall specify the appraiser chosen by the
party giving the notice or, if such appraisers cannot agree on the amount
of such appraisal within twenty (20) Business Days after the end of such
five (5) Business Day period, each shall render its own appraisal and shall
by mutual consent choose another appraiser within five (5) Business Days
after the end of such twenty (20) day period. If, within such five (5) day
period, such two appraisers fail to appoint a third appraiser, then either
Lessor or Lessee, on behalf of both, may request such appointment by the
then President of the Association of the Bar of the City of New York (or
any successor organization thereto) or, in his absence, failure, refusal or
inability to act, then either Lessor or Lessee may apply to the American
Arbitration Association (or any successor organization thereto) in New
York, New York for the appointment of such third appraiser. The decision
of the third appraiser so appointed shall be given within twenty (20)
Business Days after the appointment of such third appraiser. As soon as
the third appraiser has delivered his appraisal, that appraisal shall be
compared with the appraisals given by the other two (2) appraisers. If the
determination of one appraiser is more disparate from the average of all
three determinations than each of the other two determinations, then the
determination of such appraiser shall be excluded, the remaining two
determinations shall be averaged and such average shall be final and
binding upon the parties hereto. If no determination is more disparate
from the average of all three determinations than each of the other
determinations, then such average shall be final and binding upon the
parties thereto. The cost of such appraisal or appointment shall be borne
by Lessee.
In addition, Lessee shall be liable, except as otherwise provided
above and without duplication of amounts payable hereunder, for any and all
unpaid Rent due hereunder before, after or during the exercise of any of
the foregoing remedies and for all reasonable legal fees and other costs
and expenses (including fees of the appraisers hereinabove referred to)
incurred by Lessor, the Indenture Trustee, the Loan Participants and the
Owner Participant in connection with the return of the Airframe or any
Engine in accordance with the terms of Section 5 or in placing such
Airframe or Engine in the condition and airworthiness required by such
Section.
At any sale of the Aircraft or any part thereof pursuant to this
Section 15, Lessor (or the Indenture Trustee, any Loan Participant or the
Owner Participant) or Lessee may bid for and purchase such property.
Lessor agrees to give Lessee at least fifteen (15) days prior written
notice of the date fixed for any public sale of the Airframe or any Engine
or of the date on or after which will occur the execution of any contract
providing for any private sale and any such public sale shall be conducted
in general so as to afford Lessee (and any Sublessee) a reasonable
opportunity to bid. Except as otherwise expressly provided above, no
remedy referred to in this Section 15 is intended to be exclusive, but each
shall be cumulative and in addition to any other remedy referred to above
or otherwise available to Lessor at law or in equity; and the exercise or
beginning of exercise by Lessor of any one or more of such remedies shall
not preclude the simultaneous or later exercise by Lessor of any or all of
such other remedies. No waiver by Lessor of any Event of Default shall in
any way be, or be construed to be, a waiver of any future or subsequent
Event of Default.
Section 16. LESSEE'S COOPERATION CONCERNING CERTAIN MATTERS;
DELIVERY OF FINANCIAL STATEMENTS. Forthwith upon the execution and
delivery of each Lease Supplement and Trust Supplement from time to time
required by the terms hereof and upon the execution and delivery of any
amendment to this Lease, to the Trust Indenture or to the Trust Agreement,
Lessee will cause such Lease Supplement, Trust Supplement (and, in the case
of the initial Lease Supplement and Trust Supplement, this Lease, the Trust
Agreement and the Trust Indenture as well) or amendment to be duly filed
and recorded, and maintained of record, in accordance with the applicable
laws of the government of registry of the Aircraft. In addition, Lessee
will promptly and duly execute and deliver to Lessor such further documents
and take such further action as Lessor or the Indenture Trustee may from
time to time reasonably request in order more effectively to carry out the
intent and purpose of this Lease and to establish and protect the rights
and remedies created or intended to be created in favor of Lessor and the
Indenture Trustee hereunder, including, without limitation, if requested by
Lessor or the Indenture Trustee, at the expense of Lessee, the execution
and delivery of supplements or amendments hereto or to the Trust Indenture,
each in recordable form, subjecting to this Lease and the Trust Indenture,
any airframe or engine substituted for the Airframe or any Engine pursuant
to the terms thereof and the recording or filing of counterparts thereof,
in accordance with the laws of such jurisdictions as Lessor or the
Indenture Trustee may from time to time deem advisable. Lessee agrees to
furnish to Lessor and the Indenture Trustee promptly after execution and
delivery of any supplement and amendment hereto and promptly after the
execution and delivery of any supplement and amendment to the Trust
Indenture (except for any such supplement or amendment which does not
require or receive the approval of Lessee pursuant to the Operative
Documents and is not required pursuant to the terms of the Operative
Documents), an opinion of counsel (which may be Lessee's General Counsel,
Deputy General Counsel or Associate General Counsel) reasonably
satisfactory to Lessor and the Indenture Trustee as to the due recording or
filing of such supplement or amendment. Lessee will deliver to Lessor, the
Owner Participant and the Indenture Trustee (a) within sixty (60) days
after the end of each of the first three quarterly periods of each fiscal
year of Lessee, the publicly filed Form 10-Q report of Lessee; and (b)
within one hundred twenty (120) days after the close of such fiscal year,
the publicly filed annual report and Form 10-K report of Lessee.
Section 17. NOTICES. All notices required under the terms and
provisions hereof shall be by telecopier or other telecommunication means
(with such telecopy or other telecommunication means to be confirmed in
writing), or if such notice is impracticable, by registered, first-class
airmail, with postage prepaid, or by personal delivery of written notice
and any such notice shall become effective when received, addressed:
(a) if to Lessee, for U.S. mail at 2345 Crystal Drive, Arlington,
Virginia 22227, and for overnight courier at 2345 Crystal Drive, Arlington,
Virginia 22227, Attention: Treasurer (Telecopy No. (703) 872-5936), or to
such other address or telecopy number as Lessee shall from time to time
designate in writing to Lessor,
(b) if to Lessor, at 79 South Main Street, 3rd Floor, Salt Lake
City, Utah 84111, Attention: Corporate Trust Department (Telecopy No.
(801) 246-5053), or to such other address or telecopy number as Lessor
shall from time to time designate in writing to Lessee, and
(c) if to a Loan Participant, the Indenture Trustee or the Owner
Participant, addressed to such Loan Participant, the Indenture Trustee or
the Owner Participant at such address or telecopy number as such Loan
Participant, the Indenture Trustee or the Owner Participant shall have
furnished by notice to Lessor and to Lessee, and, until an address is so
furnished, addressed to such Loan Participant, the Indenture Trustee or the
Owner Participant at its address or telecopy number set forth in Schedule I
to the Participation Agreement.
Section 18. NO SET-OFF, COUNTERCLAIM, ETC. All Rent shall be
paid by Lessee to Lessor in funds of the type specified in Section 3(e).
Except as expressly provided herein, Lessee's obligation to pay all Rent
payable hereunder shall be absolute and unconditional and shall not be
affected by any circumstance, including, without limitation, (i) any set-
off, counterclaim, recoupment, defense or other right which Lessee may have
against Lessor, in its individual capacity or as Owner Trustee under the
Trust Agreement, the Indenture Trustee (in its individual capacity or as
Indenture Trustee), any Loan Participant, the Owner Participant, or anyone
else for any reason whatsoever (whether in connection with the transactions
contemplated hereby or any other transactions), including, without
limitation, any breach by Lessor or the Owner Participant of their
respective warranties, agreements or covenants contained in any of the
Operative Documents, (ii) any defect in the title, registration,
airworthiness, condition, design, operation, or fitness for use of, or any
damage to or loss or destruction of, the Aircraft, or any interruption or
cessation in or prohibition of the use or possession thereof by Lessee (or
any Sublessee) for any reason whatsoever, including, without limitation,
any such interruption, cessation or prohibition resulting from the act of
any government authority, (iii) any insolvency, bankruptcy, reorganization
or similar case or proceedings by or against Lessee (or any Sublessee) or
any other person, or (iv) any other circumstance, happening, or event
whatsoever, whether or not unforeseen or similar to any of the foregoing;
provided, however, that notwithstanding the foregoing, Lessee shall be
entitled to offset from any payment due to the Owner Participant the cost
incurred by Lessee to discharge Lessor Liens relating to the Owner
Participant. If for any reason whatsoever this Lease shall be terminated
in whole or in part by operation of law or otherwise except as specifically
provided herein, Lessee nonetheless agrees without limitation of the other
rights or remedies of Lessor hereunder to pay to Lessor an amount equal to
each Rent payment at the time such payment would have become due and
payable in accordance with the terms hereof had this Lease not been
terminated in whole or in part. Lessee hereby waives, to the extent
permitted by applicable law, any and all rights which it may now have or
which at any time hereafter may be conferred upon it, by statute or
otherwise, to terminate, cancel, quit or surrender this Lease except in
accordance with the express terms hereof.
Section 19. RENEWAL OPTIONS; PURCHASE OPTIONS; VALUATION.
(a) Renewal Options.
(1) Fixed Renewal Term. Not more than 365 days and not
less than one hundred twenty (120) days, before the end of the Basic
Term or any Fixed Renewal Term (as hereinafter defined), Lessee may
deliver to Lessor a written notice irrevocably electing to renew this
Lease for a term having a duration and at a Basic Rent as determined
below (any such renewal term, a "Fixed Renewal Term"). The duration
of any Fixed Renewal Term shall be a period specified by Lessee before
the end of the Basic Term which is (i) not less than one year
(provided any such period shall be in six (6) month increments), (ii)
not more than the longest period of time which would cause the Term,
after giving effect to such Fixed Renewal Term, to be equal to 75% of
the total useful life of the aircraft as determined by the Delivery
Date appraisal. Each semi-annual installment of Basic Rent during the
Fixed Renewal Term shall be equal to the lesser of (A) the fair market
rental value of the Aircraft or (B) one-half of the average annual
Basic Rent during the Basic Term.
(2) Fair Market Renewal Term. Lessee shall have the right
to renew this Lease for additional periods of one (1) year or more
(provided any such period shall be on six (6) month increments)
commencing at the end of the Basic Term or the Fixed Renewal Term for
a Basic Rent equal to the fair market rental value of the Aircraft for
such period (any such renewal term, a "Fair Market Renewal Term").
Each such option to renew shall be exercised by Lessee providing
irrevocable notice at least one hundred twenty (120) days prior to the
commencement of such Fair Market Renewal Term.
(3) Waiver. If no written notice is delivered by Lessee to
Lessor pursuant to Section 19(a)(1) or (a)(2) on or before the day
specified therefor, Lessee shall be deemed to have waived any right to
renew this Lease.
(4) Conditions Precedent, Payment of Basic Rent. At the
end of the Basic Term or any Renewal Term, if Lessee has elected to
renew this Lease as aforesaid, (i) this Lease shall continue in full
force and effect during the Renewal Term, and (ii) Basic Rent for such
Renewal Term shall be payable in semi-annual installments in arrears,
each such installment being due and payable on each Lease Period Date
occurring during the Renewal Term, commencing with the Lease Period
Date immediately following the commencement of the Renewal Term,
provided that Basic Rent for such Renewal Term shall be payable at
such other frequency of payment consistent with the length of the
Renewal Term as Lessor may reasonably designate in the event that such
period is not divisible into whole semi-annual periods.
(5) Termination Value. The amounts which are payable
during any Renewal Term in respect of Termination Value with respect
to the Aircraft shall be determined on the basis of the fair market
sales value of the Aircraft as of the commencement of such Renewal
Term, amortized on a straight-line basis over such Renewal Term to the
projected fair market sales value of the Aircraft as of the expiration
of such Renewal Term, as such fair market sales value in each case is
determined prior to the commencement of such Renewal Term. In
determining fair market sales value for purposes of calculating
Termination Value for any Renewal Term effect shall be given to the
encumbrance on the Aircraft of any Fixed Renewal Term available or in
force.
(b) Purchase Options. Lessee shall have the option, (i) upon at
least thirty (30) days irrevocable prior written notice to Lessor prior to
the EBO Date with respect to the purchase option set forth in clause (i)
and (ii) upon at least one hundred twenty (120) days irrevocable prior
written notice to Lessor prior to the relevant purchase date (each a
"Purchase Option Date") with respect to the purchase options set forth in
clauses (ii) and (iii), to terminate this Lease and to purchase the
Aircraft:
(1) on the EBO Date, for a purchase price equal to the EBO
Amount set forth on Exhibit D, it being understood that if such amount
is to be paid in installments, Lessee will, upon payment of the first
installment of the EBO Amount, on the EBO date, receive title to the
Aircraft free and clear of all liens (other than the Lien of the
Indenture if Lessee has elected to assume the Equipment Notes in
accordance with Section 7(u) of the Participation Agreement);
(2) on the last Business Day of the Basic Term for a
purchase price equal to the fair market sales value of the Aircraft on
such date, provided, however, that in no event shall such purchase
price exceed 50% of Lessor's Cost;
(3) on the last Business Day of any Renewal Term for a
purchase price equal to the fair market sales value of the Aircraft on
such date.
Notwithstanding the foregoing but subject to the last sentence of
this paragraph, the purchase price on any Purchase Option Date shall be
sufficient, together with all other amounts payable simultaneously by
Lessee, to pay in full the payments then required to be made on account of
the principal amount of and accrued and unpaid interest on the Equipment
Notes then outstanding. Upon payment to Lessor in immediately available
funds in Dollars of the full amount of the purchase price and payment of
any other amounts then due hereunder (including all Rent and all reasonable
costs or expenses of the Owner Participant in connection with such
purchase), Lessor will transfer to Lessee, without recourse or warranty
(except as to the absences of Lessor Liens), all of Lessor's right, title
and interest in and to the Aircraft. Notwithstanding the foregoing, Lessee
may, in accordance with Section 7(u) of the Participation Agreement, assume
the principal amount of the Equipment Notes then outstanding on any
applicable Purchase Option Date in which event Lessee shall receive a
credit against the purchase price otherwise payable pursuant to the
preceding two sentences in an amount equal to the principal amount so
assumed.
(c) Valuation. At any time not earlier than three hundred sixty-
five (365) days prior to the date on which Lessee may purchase the Aircraft
pursuant to Section 19(b)(2) or (b)(3) hereof or renew this Lease pursuant
to Section 19(a)(1) or (a)(2) hereof, Lessee may deliver to Lessor a
revocable notice of its intent to exercise its renewal option or purchase
option. For all purposes of this Section 19 and Section 20, including the
appraisal referred to in this Section 19(c), in determining "fair market
rental value" or "fair market sales value", the Aircraft shall be valued
(i) as if in the condition and otherwise in compliance with the terms of
Section 5 upon a return of the Aircraft to Lessor and as if it had been
maintained at all times as required in accordance with Section 7(a)(i)
during periods when no Sublease was in effect, (ii) on the basis of the
value which would obtain in an arm's-length transaction between an informed
and willing buyer-user or lessee (other than a lessee or an Affiliate of a
lessee currently in possession or a used equipment scrap dealer) under no
compulsion to buy or lease and an informed and willing seller or lessor
unaffiliated with such buyer-user or lessee and under no compulsion to sell
or lease and disregarding the purchase and renewal options of the lessee
provided in this Lease, and (iii) in the case of such valuation for
determining "fair market rental value", assuming such lessee would have
substantially the same obligations during the Fair Market Renewal Term as
provided hereunder including without limitation the obligations of Lessee
to carry and maintain the insurance required by Section 11 hereof and to
make certain payments with reference to Termination Value during the
applicable Fair Market Renewal Term. Upon receipt of such notice Lessor
and Lessee shall confer in good faith with a view to reaching agreement on
the "fair market rental value" or "fair market sales value" of the
Aircraft. If the parties have not so agreed within two hundred seventy
(270) days prior to the end of the Basic Term or the Renewal Term in
question, then the question shall be determined by an appraisal mutually
agreed to by two recognized independent aircraft appraisers, one of which
appraisers shall be chosen by Lessor and one by Lessee within five (5)
Business Days after Lessor or Lessee shall have received written notice
from the other party of a demand that such an appraisal be made, which
notice shall specify the appraiser chosen by the party giving the notice
or, if such appraisers cannot agree on the amount of such appraisal within
twenty (20) Business Days after the end of such five (5) Business Day
period, each shall render its own appraisal and shall by mutual consent
choose another appraiser within five (5) Business Days after the end of
such twenty (20) Business Day period. If, within such five (5) Business
Day period, such two appraisers fail to appoint a third appraiser, then
either Lessor or Lessee, on behalf of both, may request such appointment by
the then President of the Association of the Bar of the City of New York
(or any successor organization thereto) or, in his absence, failure,
refusal or inability to act, then either Lessor or Lessee may apply to the
American Arbitration Association (or any successor organization thereto) in
New York, New York for the appointment of such third appraiser. The
decision of the third appraiser so appointed shall be given within ten (10)
Business Days after the appointment of such third appraiser. As soon as
the third appraiser has delivered his appraisal, that appraisal shall be
compared with the appraisals given by the other two appraisers. If the
determination of one appraiser is more disparate from the average of all
three determinations than each of the other two determinations, then the
determination of such appraiser shall be excluded, the remaining two
determinations shall be averaged and such average shall be final and
binding upon the parties hereto. If no determination is more disparate
from the average of all three determinations than each of the other
determinations, then such average shall be final and binding upon the
parties thereto. Lessee and Lessor shall share equally all expenses
relating to such appraisal procedure provided if Lessee elects not to renew
this Lease or purchase the Aircraft following such appraisal, Lessee shall
pay all expenses of such appraisal.
Section 20. BURDENSOME PURCHASE OPTION. If a Burdensome
Termination Event shall have occurred, then on any Lease Period Date
occurring after the expiration of the Depreciation Period, Lessee shall
have the option, upon at least one hundred twenty (120) days revocable
prior notice to Lessor and, if any Equipment Notes are then outstanding,
the Indenture Trustee, to purchase the Aircraft on such date for a purchase
price equal to the higher of the Termination Value as of such date or the
fair market sales value of the aircraft (determined as set forth in clause
(c) above and excluding the value of any Significant Expenditure) (such
price, the "Burdensome Buyout Price"). In addition, if on such date there
shall be any Equipment Notes outstanding, Lessee shall have the option to
assume, pursuant to Section 7(u) of the Participation Agreement and Section
2.13 of the Trust Indenture, all of the obligations of Lessor under the
Trust Indenture. If such assumption is made, Lessee shall pay Lessor a
purchase price equal to (I) the Burdensome Buyout Price minus (II) an
amount equal to principal of, and accrued but unpaid interest on, any
Equipment Notes that are outstanding on such date. Upon such payment in
full and payment of any other amounts then due hereunder (including costs
or expenses of the Owner Participant in connection with such purchase, any
installments of Basic Rent due prior to such date and, if Basic Rent is
payable in arrears on such date as indicated on Exhibit B, on such date
(but not any installment of Basic Rent due on such date if Basic Rent is
payable in advance on such date), and all unpaid Supplemental Rent due on
or prior to such date), Lessor will transfer to Lessee, without recourse or
warranty (except as to the absence of Lessor Liens), all of Lessor's right,
title and interest in and to the Aircraft and under the Trust Indenture
and, unless there shall be any Equipment Notes outstanding after such
payment, exercise such rights as it has to cause the Aircraft to be
released from the Lien of the Trust Indenture.
Section 21. SECURITY FOR LESSOR'S OBLIGATION TO HOLDERS OF
EQUIPMENT NOTES. In order to secure the indebtedness evidenced by the
Equipment Notes, Lessor has agreed in the Trust Indenture, among other
things, to assign to the Indenture Trustee this Lease, the Lease
Supplements and any amendments to this Lease and to mortgage its interest
in the Aircraft in favor of the Indenture Trustee, subject to the
reservations and conditions therein set forth. To the extent, if any, that
this Lease, the Lease Supplements and any amendments to this Lease
constitute chattel paper (as such term is defined in the Uniform Commercial
Code as in effect in any applicable jurisdiction), no security interest in
this Lease, the Lease Supplements and any amendments to this Lease may be
created through the transfer or possession of any counterpart other than
the original counterpart, which shall be identified as the counterpart
containing the receipt therefor executed by the Indenture Trustee on the
signature page thereof. Lessee hereby accepts and consents to the
assignment of all Lessor's right, title and interest in and to this Lease
pursuant to the terms of the Trust Indenture. Subject to Section 3(e)
hereof, Lessee agrees to pay directly to the Indenture Trustee (or, after
receipt by Lessee of notice from the Indenture Trustee of the discharge of
the Trust Indenture, to Lessor), all amounts of Rent due or to become due
hereunder and assigned to the Indenture Trustee and Lessee agrees that the
Indenture Trustee's right to such payments hereunder shall be absolute and
unconditional and shall not be affected by any circumstance, including,
without limitation, the circumstances set forth in clauses (i) through (iv)
of Section 18 hereof. Notwithstanding the foregoing assignment of this
Lease, the obligations of Lessor to Lessee to perform the terms and
conditions of this Lease shall remain in full force and effect.
Section 22. LESSOR'S RIGHT TO PERFORM FOR LESSEE. If Lessee
fails to make any payment of Rent required to be made by it hereunder or
fails to perform or comply with any of its agreements contained herein,
then (but in each case, except in the case of failure to pay Rent or in the
case of failure to maintain insurance as required hereunder, no earlier
than the fifteenth day after the occurrence of such failure, whether or not
it shall yet constitute an Event of Default hereunder) Lessor may itself
make such payment or perform or comply with such agreement but shall not be
obligated hereunder to do so, and the amount of such payment and the amount
of the reasonable expenses of Lessor incurred in connection with such
payment or the performance of or compliance with such agreement, as the
case may be, together with interest thereon at the Past Due Rate, shall be
deemed Supplemental Rent, payable by Lessee upon demand.
Section 23. INVESTMENT OF SECURITY FUNDS; LIABILITY OF LESSOR
LIMITED.
(a) Investment of Security Funds. Any moneys held by Lessor as
security hereunder for future payments to Lessee at a time when there is
not continuing an Event of Default shall, until paid to Lessee, be invested
by Lessor or, if the Trust Indenture shall not have been discharged, by the
Indenture Trustee, as the case may be, as Lessee may from time to time
direct in writing (and in absence of a written direction by Lessee, there
shall be no obligation to invest such moneys) in Cash Equivalents. There
shall be promptly remitted to Lessee or its order (but no more frequently
than monthly) any gain (including interest received) realized as a result
of any such investment (net of any fees, commissions and other expenses, if
any, incurred in connection with such investment) unless an Event of
Default shall have occurred and be continuing. Lessee shall be responsible
for any net loss realized as a result of any such investment and shall
reimburse Lessor (or the Indenture Trustee, as the case may be) therefor on
demand.
(b) Liability of Lessor Limited. It is expressly agreed and
understood that all representations, warranties and undertakings of Lessor
hereunder shall be binding upon Lessor only in its capacity as trustee
under the Trust Agreement, and the institution acting as Lessor shall not
be liable in its individual capacity for any breach thereof except for its
gross negligence or willful misconduct or for breach of its covenants,
representations and warranties contained herein, to the extent covenanted
or made in its individual capacity.
Section 24. JURISDICTION. Lessor and Lessee each hereby irrevocably
submits itself to the non-exclusive jurisdiction of the United States
District Court for the Southern District of New York and to the non-
exclusive jurisdiction of the Supreme Court of the State of New York, New
York County, for the purposes of any suit, action or other proceeding
arising out of this Lease, the subject matter hereof or any of the
transactions contemplated hereby brought by Lessor, Lessee, the Indenture
Trustee, the Loan Participants or the Owner Participant or their
successors or assigns.
Section 25. MISCELLANEOUS. Any provision of this Lease 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. No term or provision of this Lease may be changed, waived,
discharged or terminated orally, but only by an instrument in writing
signed by Lessor, Lessee and any assignee of Lessor's rights hereunder.
This Lease shall constitute an agreement of lease, and nothing contained
herein shall be construed as conveying to Lessee any right, title or
interest in the Aircraft except as a lessee only. Neither Lessee nor any
affiliate of Lessee will file any tax returns in a manner inconsistent
with the foregoing fact or with Lessor's ownership of the Aircraft. The
section and paragraph headings in this Lease and the table of contents are
for convenience of reference only and shall not modify, define, expand or
limit any of the terms or provisions hereof and all references herein to
numbered sections, unless otherwise indicated, are to sections of this
Lease. THIS LEASE HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN
ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE. This Lease 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 26. SUCCESSOR TRUSTEE. Lessee agrees that in the case of
the appointment of any successor Owner Trustee pursuant to the terms of
the Trust Agreement, such successor Owner Trustee shall, upon written
notice by such successor Owner Trustee, succeed to all the rights, powers
and title of Lessor hereunder and shall be deemed to be Lessor and the
owner of the Aircraft for all purposes hereof without the necessity of any
consent or approval by Lessee (subject to Section 9 of the Participation
Agreement) and without in any way altering the terms of this Lease or
Lessee's obligations hereunder. One such appointment and designation of a
successor Owner Trustee shall not exhaust the right to appoint and
designate further successor Owner Trustees pursuant to the Trust
Agreement, but such right may be exercised repeatedly as long as this
Lease shall be in effect.
Section 27. LEASE FOR U.S. FEDERAL INCOME TAX LAW PURPOSES; SECTION
1110 OF BANKRUPTCY CODE
(a) Lease for Federal Income Tax Law Purposes. It is the intent
of the parties to this Agreement that this Lease is a true lease for U.S.
Federal income tax purposes.
(b) Section 1110 of Bankruptcy Code. It is the intention of each
of Lessee and Lessor that Lessor (and the Indenture Trustee as secured
party and as assignee of Lessor under the Trust Indenture) 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 this Lease.
IN WITNESS WHEREOF, Lessor and Lessee have each caused this Lease
to be duly executed as of the day and year first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual capacity except
as expressly provided herein, but solely as Owner
Trustee,
Lessor
By: __________________________________
Title: _______________________________
US AIRWAYS, INC.,
Lessee
By: __________________________________
Title: _______________________________
Receipt of this original counterpart of the foregoing Lease is
hereby acknowledged on the ___ day of _________, ____.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION,
Indenture Trustee
By:__________________________________
Title: ______________________________
As set forth in Section 21 of the Lease (as defined below), Lessor has
assigned to the Indenture Trustee (as defined herein) certain of its right,
title and interest in and to the Lease and this Lease Supplement. To the
extent, if any, that this Lease Supplement constitutes chattel paper (as
such term is defined in the Uniform Commercial Code as in effect in any
applicable jurisdiction) no security interest in this Lease Supplement may
be created through the transfer or possession of any counterpart other than
the original executed counterpart, which shall be identified as the
counterpart containing the receipt therefor executed by the Indenture
Trustee on the signature page thereof.
EXHIBIT A
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
LEASE SUPPLEMENT NO.
(US Airways, Inc. Trust No. N___U_)
LEASE SUPPLEMENT NO. __, dated _________, _____, between FIRST
SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, not in
its individual capacity, but solely as Owner Trustee under the Trust
Agreement (US Airways, Inc. Trust No. N___U_), dated as of __________ __,
____ with the Owner Participant named therein (such Owner Trustee, in its
capacity as such Owner Trustee, being herein called "Lessor"), and US
AIRWAYS, INC., a Delaware corporation ("Lessee").
Lessor and Lessee have heretofore entered into that certain Lease
Agreement (US Airways, Inc. Trust No. N___U_), dated as of __________ __,
____, relating to one Airbus Model A___(4) aircraft (herein called the
"Lease," and the defined terms therein being hereinafter used with the same
meanings). The Lease provides for the execution and delivery from time to
time of Lease Supplements for the purpose of leasing the Airframe and
Engines under the Lease as and when delivered by Lessor to Lessee in
accordance with the terms thereof.
[The Lease relates to the Airframe and Engines described below,
and a counterpart of the Lease is attached hereto, and made a part hereof,
and this Lease Supplement, together with such attachment, is being filed
for recordation on the date hereof with the Federal Aviation Administration
as one document.](5)
[The Lease relates to the Airframe and Engines described below,
and a counterpart of the Lease, attached and made a part of Lease
Supplement No. 1 dated _______________, ____ to the Lease, has been
recorded by the Federal Aviation Administration on ________________, ____,
as one document and assigned Conveyance No. __.](6)
NOW, THEREFORE, in consideration of the premises and other good
and sufficient consideration, Lessor and Lessee hereby agree as follows:
-------------------
(4) Insert "A319", "A320" or "A330", as applicable.
(5) For use on Lease Supplement No. 1.
(6) For use on Lease Supplement No. 2 and thereafter.
(a) Lessor hereby delivers and leases to Lessee under the Lease
and Lessee hereby accepts and leases from Lessor under the Lease the
following described Airbus Model A___(7) aircraft (the "Aircraft"), which
Aircraft as of the date hereof consists of the following components:
(i) Airframe: Airbus Model A___-___(8)
airframe bearing FAA Registration No. ______; manufacturer's
serial no. _____; and
(ii) Engines: two (2) engines identified as
[ ](9) type aircraft engines bearing,
respectively, manufacturer's serial nos.______ and _____ (each of
which engines has 750 or more rated takeoff horsepower or the
equivalent of such horsepower).
(b) The Delivery Date of the Aircraft is the date of this Lease
Supplement set forth in the opening paragraph hereof. Except as otherwise
provided in the Lease, the Term for the Aircraft shall commence on the
Delivery Date and end on ____________, 20__.
(c) Lessee hereby confirms its agreement to pay Lessor Basic
Rent for the Aircraft throughout the Term therefor in accordance with
Section 3 of the Lease.
(d) Lessee hereby confirms to Lessor that Lessee has accepted
the Aircraft for all purposes hereof and of the Lease as being airworthy,
in good working order and repair and without defect or inherent vice in
title, condition, design, operation or fitness for use; provided, however,
that nothing contained herein or in the Lease shall in any way diminish or
otherwise affect any right Lessee or Lessor may have with respect to the
Aircraft against Airbus Industrie G.I.E., or any subcontractor or supplier
of Airbus Industrie G.I.E., under the Purchase Agreement or otherwise.
(e) All of the terms and provisions of the Lease are hereby
incorporated by reference in this Lease Supplement to the same extent as if
fully set forth herein.
(f) This Lease Supplement 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. To the extent, if any, that this Lease
Supplement constitutes chattel paper (as such term is defined in the
Uniform Commercial Code as in effect in any jurisdiction), no security
interest in this Lease Supplement may be created through the transfer or
possession of any counterpart other than the original counterpart, which
shall be identified as the counterpart containing the receipt therefor
executed by the Indenture Trustee on the signature page hereof.
-----------------
(7) Insert "A319", "A320" or "A330 as applicable.
(8) Insert full model number of Aircraft (e.g., "A319-112").
(9) Insert engine manufacturer and model number.
IN WITNESS WHEREOF, Lessor and Lessee have caused this Lease
Supplement to be duly executed on the day and year first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual capacity except
as expressly provided herein, but solely as Owner
Trustee,
Lessor
By: ____________________________________________
Name:
Title:
US AIRWAYS, INC.,
Lessee
By:___________________________________________
Name:
Title:
(1) Receipt of this original counterpart of the foregoing Lease
Supplement is hereby acknowledged on this ____ day of __________, ___ .
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION,
Indenture Trustee
By: ________________________________
Name:
Title:
--------------
(1) This language contained in the original counterpart only.
Form Lease
N____U_
EXHIBIT B
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
PAST DUE RATE DEFINED; BASIC RENT AND LESSOR'S COST
The portion of this Exhibit appearing below will be intentionally
deleted from the FAA filing counterpart as the parties hereto deem it to
contain confidential information.
"Past Due Rate" means (i) with respect to any portion of any
payment of Rent that may be required by the Trust Indenture to be paid by
the Indenture Trustee to the Loan Participants, or the holders of any
outstanding Equipment Notes, a rate per annum equal to 1% over the interest
rate then in effect for such Equipment Notes, and (ii) with respect to the
remaining portion of any payment of Rent (and the entire amount of any
payment of Rent after the satisfaction and discharge of the Trust
Indenture), a rate per annum equal to 1% over the Base Rate.
Basic Rent:
Basic Rent
Lease Period (Percentage of
Date Lessor's Cost)
------------- ----------------
*
**
Lessor's Cost: $_______________
_______________
* Denotes payment in arrears from preceding Lease Period Date (or
Delivery Date in the case of the first Lease Period) to specified
Lease Period Date.
** Denotes payment in advance from specified Lease Period Date to
succeeding Lease Period Date.
Form Lease
N____U_
EXHIBIT C
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
TERMINATION VALUE SCHEDULE
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
Termination Termination
Value Percentage Value Date
---------------- ------------
Form Lease
N____U_
EXHIBIT D
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
EBO AMOUNT
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
EBO Date EBO Amount
-------- ----------
Form Lease
N____U_
EXHIBIT E
to
Lease Agreement
(US Airways, Inc. N___U_)
RENT RECALCULATION AND
INDEMNIFICATION VERIFICATION
The portion of this Exhibit appearing below this will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
Any recalculation of Basic Rent, Termination Value percentages
and EBO Amount pursuant to the Lease shall be determined by the Owner
Participant, and shall maintain the Owner Participant's Net Economic Return
except as assumptions have been modified pursuant to Section 3 of the Lease
or pursuant to the Tax Indemnity Agreement or the Participation Agreement,
as the case may be; provided, however, that Lessee may request (A) Lessee's
independent public accountants to verify such calculations but without any
requirement that the Owner Participant disclose to such persons the
methodology and assumptions and (B) if Lessee believes that such
calculations by the Owner Participant are in error then a nationally
recognized firm of accountants selected by the Owner Participant and
reasonably acceptable to Lessee shall be permitted to verify such
calculations and the Owner Participant will make available to such firm
(subject to the execution by such firm of a confidentiality agreement
reasonably acceptable to the Owner Participant) the methodology and
assumptions and any changes made therein pursuant to Section 3 of the
Lease. In the event of a verification under clause (B) of the first
sentence of this paragraph the determination by such firm of accountants
shall be final. Lessee will pay the reasonable costs and expenses of the
verification under clause (B) of the first sentence of this paragraph
unless an error adverse to Lessee is established by such firm, and if as a
result of such verification process the Basic Rent is adjusted and such
adjustment causes the Net Present Value of Rents to decline by 10 (ten) or
more basis points or causes a material reduction in Termination Value, EBO
Amount or any indemnity payment (in which event the Owner Participant shall
pay the reasonable costs and expenses of such verification process). Such
recalculated Basic Rent, Termination Value percentages and EBO amounts
shall be set forth in a Lease Supplement or an amendment to the Lease.
"Net Economic Return" means the Owner Participant's after-tax
yield and aggregate after-tax cash flow utilizing the multiple investment
sinking fund method of analysis, computed on the basis of the same
methodology and assumptions as were utilized by the Owner Participant in
determining Basic Rent, Termination Value percentages and EBO Amount as of
the Delivery Date.
Form Lease
N____U_
EXHIBIT F
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
SCHEDULE OF DOMICILES OF PERMITTED SUBLESSEES
Australia Malta
Austria Mexico
Bahamas Netherlands
Belgium New Zealand
Bermuda Norway
Brazil People's Republic of China
Canada Philippines
Denmark Portugal
Finland Republic of China (Taiwan)*
France Singapore
Germany South Korea
Grenada Spain
Greece Sweden
Iceland Switzerland
India Thailand
Ireland Tobago
Italy Trinidad
Jamaica Turkey
Japan United Kingdom
Luxembourg United States of America
Malaysia Venezuela
*So long as on the date of the Sublease such country and the United
States have diplomatic relations at least as good as those in effect on the
Delivery Date.
Form Lease
N____U_
EXHIBIT G
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
RETURN CONDITIONS
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
(a) Condition Upon Return. Unless purchased by Lessee pursuant
to Section 19 or 20 hereof, upon the termination of this Lease at the end
of the Basic Term or any Renewal Term or pursuant to Sections 9(b) or 15,
unless Lessor has requested that Lessee return the Aircraft to a storage
location pursuant to Section 5(b) (in which case the storage location
provided in said Section 5(b) shall be deemed to be the return location),
Lessee will return the Airframe to Lessor at one of Lessee's principal
maintenance bases located in one of the forty-eight contiguous states of
the United States chosen by Lessee, and Lessee will give Lessor at least
ten (10) days prior written notice of the place of such return. At the
time of such return, (i) Lessee will, at its own cost and expense, unless
otherwise requested by Lessor to retain the existing registration of the
Aircraft at least ninety (90) days prior to the date of return hereunder,
cause the Aircraft, if it is not then so registered, to be registered under
the laws of the United States with the Federal Aviation Administration in
the name of the Lessor or its designee, provided that Lessee shall be
relieved of its obligations under this sentence if such registration is
prohibited by reason of the failure of Lessor, Owner Participant or
Lessor's designee to be eligible on such date to own an aircraft registered
with the Federal Aviation Administration and (ii) the Airframe will be
fully equipped with the Engines (or Acceptable Alternate Engines) installed
thereon. Also, at the time of such return, Lessor shall have good title to
such Airframe and Engines or Acceptable Alternate Engines, and such
Airframe and Engine or Acceptable Alternate Engines (A) shall be certified
(or, if not then registered under the Transportation Code by reason of the
proviso of clause (i) in the preceding sentence or because Lessor has so
requested that the Aircraft not be so registered, shall hold a valid
certificate of airworthiness issued by the country of registry and be
eligible for certification by the Federal Aviation Administration) as an
airworthy aircraft by the Federal Aviation Administration, (B) shall be
free and clear of all Liens (other than Lessor Liens, Indenture Trustee's
Liens and Loan Participant Liens) and rights of third parties under
pooling, interchange, overhaul, repair or other similar agreements or
arrangements, (C) shall be in a regular passenger configuration, and in as
good a condition as when delivered by Seller to Lessee, ordinary wear and
tear excepted, and otherwise in the condition required to be maintained
under Lessee's FAA-approved maintenance plan (notwithstanding any Sublease
theretofore in effect), (D) in the event that Lessee (or any Sublessee then
in possession of the Aircraft) shall not then be using a continuous
maintenance program with respect to the Airframe immediately prior to such
return but instead shall have been using a block overhaul program with
respect to the Airframe, then (i) such block overhaul program shall have
been approved by the government of registry of the Aircraft and (ii) the
Airframe shall have remaining until the next scheduled block overhaul at
least 25% of the allowable hours between block overhauls permitted under
the block overhaul program then used by Lessee or such Sublessee, (E) in
the event that Lessee (or any Sublessee then in possession of the Aircraft)
during the period of operation of the Aircraft immediately prior to such
return shall not have been using an on-condition maintenance program with
respect to the Engines (or Acceptable Alternate Engines), Lessee agrees
that the average number of hours or cycles of operation (whichever shall be
applicable under the maintenance program then in use with respect to such
Engines (or Acceptable Alternate Engines) on such Engines (or Acceptable
Alternate Engines) remaining until the next scheduled engine heavy
maintenance shall be at least 25% of the hours or cycles (whichever shall
be applicable) between engine heavy maintenance allowed under the
maintenance program then in use with respect to such Engines (or Acceptable
Alternate Engines), (F) shall have all Lessee's and any Sublessee's
exterior marking removed or painted over with areas thereof refinished to
match adjacent areas, and (G) shall be in a state of cleanliness suitable
under Lessee's normal service standards for operation in Lessee's revenue
passenger service and in all such cases the Aircraft shall not have been
discriminated against whether by reason of its leased status or otherwise
in maintenance, use, operation or in any other manner whatsoever.
If clause (D) of the first paragraph of this subsection (a) shall
be applicable but the Airframe does not meet the conditions specified in
said clause (D), Lessee shall pay or cause to be paid to Lessor,
concurrently with the return thereof, a Dollar amount computed by
multiplying (i) 110% of the direct cost to Lessee (based upon the direct
cost to Lessee for similar aircraft in the fleet of Lessee) during the
preceding 12 months of performing an airframe block overhaul of the type
referred to in such clause (D) by (ii) a fraction of which (x) the
numerator shall be the excess of 25% of the hours of operation allowable
between such block overhauls over the actual number of hours of operation
remaining on the Airframe to the next such block overhaul and (y) the
denominator shall be the number of hours of operation allowable between
such block overhauls in accordance with such block overhaul program.
If clause (E) of the first paragraph of this subsection (a) shall
be applicable but the Engines (or Acceptable Alternate Engines) do not meet
the conditions specified in said clause (E), Lessee shall pay or cause to
be paid to Lessor, concurrently with the return thereof, a Dollar amount
computed by multiplying (i) 110% of the direct cost to Lessee (based upon
the direct cost to Lessee for similar aircraft in the fleet of Lessee)
during the preceding 12 months of performing for an engine of the same
model as the Engines (or Acceptable Alternate Engines) the scheduled engine
heavy maintenance under the maintenance program then used by Lessee for
engines of the same model as the Engines (or Acceptable Alternate Engines)
by (ii) a fraction which (x) the numerator shall be the excess of 25% of
the hours or cycles (whichever is applicable) of operation of one Engine
between engine heavy maintenance allowable under the maintenance program
then in use with respect to such Engines (or Acceptable Alternate Engines)
over the actual average number of hours or cycles of operation of such
Engines (or Acceptable Alternate Engines) remaining until the next such
scheduled engine heavy maintenance and (y) the denominator shall be the
number of hours or cycles allowable between such scheduled engine heavy
maintenance.
(b) Return of the Engines. In the event that an Acceptable
Alternate Engine shall be delivered with the returned Airframe as set forth
in subsection (a) of this Exhibit G, Lessee, concurrently with such
delivery, will, at no cost to Lessor, furnish, or cause to be furnished, to
Lessor a full warranty (as to title) bill of sale with respect to each such
Acceptable Alternate Engine, in form and substance satisfactory to Lessor
(together with an opinion of counsel (which may be Lessee's General
Counsel, Deputy General Counsel or Associate General Counsel) to the effect
that such full warranty bill of sale has been duly authorized and delivered
and is enforceable in accordance with its terms and that each such
Acceptable Alternate Engine is free and clear of all Liens other than
Lessor Liens, Loan Participant Liens and Indenture Trustee Liens), against
receipt from Lessor of a bill of sale or evidencing the transfer, without
recourse or warranty (except as to the absence of Lessor Liens), by Lessor
to Lessee or its designee of all of Lessor's right, title and interest in
and to any Engine not installed on the Airframe at the time of the return
of the Airframe.
(c) Fuel and Manuals. Upon the return of the Airframe upon any
termination of this Lease in accordance with subsection (a) of this Exhibit
G, (i) Lessor shall pay to Lessee, the amount of Lessee's cost for any fuel
or oil contained in the fuel or oil tanks of such Airframe and (ii) Lessee
shall deliver or cause to be delivered to Lessor all logs, manuals and data
and inspection, modification and overhaul records required to be maintained
under the provisions of the Lease.
Form Lease
N____U_
EXHIBIT H
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
INSURANCE
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
(a) Public Liability and Property Damage Insurance. (1) Except
as provided in clause (2) of this subsection (a), and subject to self-
insurance to the extent permitted by subsection (d) of this Exhibit H,
Lessee will carry or cause to be carried with respect to the Aircraft at
its or any Sublessee's expense (i) comprehensive airline liability
(including, without limitation, passenger, contractual, bodily injury and
property damage liability) insurance (exclusive of manufacturer's product
liability insurance) and (ii) cargo liability insurance, (A) in an amount
not less than the greater of (x) the amounts of comprehensive airline
liability insurance from time to time applicable to aircraft owned or
leased, and operated by Lessee (or, if a Sublease is then in effect, by
Sublessee) of the same type as the Aircraft and (y) $300 million per
occurrence, (B) of the type and covering the same risks as from time to
time applicable to aircraft owned or leased and operated by Lessee of the
same type as the Aircraft, and (C) which is maintained in effect with
insurers of nationally or internationally recognized reputation and
responsibility; provided, however, that Lessee need not maintain such cargo
liability insurance, or may maintain such cargo liability insurance in an
amount less than $300 million per occurrence, so long as the amount of
cargo liability insurance, if any, maintained with respect to the Aircraft
is not less than the cargo liability insurance, if any, maintained for
other Airbus Model A___(10) aircraft owned or leased and operated by Lessee.
(2) During any period that the Airframe or an Engine, as the case
may be, is on the ground and not in operation, Lessee may carry or cause to
be carried as to such non-operating property, in lieu of the insurance
required by clause (1) above, and subject to the self-insurance to the
extent permitted by subsection (d) hereof, insurance by insurers of
nationally or internationally recognized reputation and responsibility
otherwise conforming with the provisions of said clause (1) except that (A)
the amounts of coverage shall not be required to exceed the amounts of
comprehensive airline liability from time to time applicable to property
owned or leased by Lessee of the same type as such non-operating property
and which is on the ground and not in operation; and (B) the scope of the
risks covered and the type of insurance shall be the same as from time to
time shall be applicable to aircraft owned or leased by Lessee of the same
type as such non-operating property and which is on the ground and not in
operation.
(b) Insurance Against Loss or Damage to the Aircraft.
(1) Except as provided in clause (2) of this subsection (b), and subject to
the provisions of subsection (d) of this Exhibit H permitting the self-
insurance, Lessee shall maintain or cause to be maintained in effect, at
its or any Sublessee's expense, with insurers of nationally or
internationally recognized responsibility, all-risk aircraft hull insurance
covering the Aircraft and fire and extended coverage and all-risk aircraft
------------------
(10) Insert "A319", "A320" or "A330", as applicable.
hull insurance covering Engines and Parts while temporarily removed from
the Aircraft and not replaced by similar components; provided that such
insurance shall at all times while the Aircraft is subject to this Lease be
for an amount (taking into account the self-insurance to the extent
permitted by subsection (d) of this Exhibit H) not less than the
Termination Value for the Aircraft; provided further, that, subject to
compliance with subsection (d) of this Exhibit H, such all-risk property
damage insurance covering Engines and Parts temporarily removed from an
Airframe or an airframe or (in the case of Parts) an Engine need be
obtained only to the extent available at reasonable cost (as reasonably
determined by Lessee). In the case of a Loss with respect to an engine
(other than an Engine) installed on the airframe in circumstances which do
not constitute an Event of Loss with respect to the Airframe, Lessor shall
promptly remit any payment made to it of any insurance proceeds in respect
of such Loss to Lessee or any other third party that is entitled to receive
such proceeds.
Unless an Event of Default has occurred and is continuing, all
losses will be adjusted by Lessee with the insurers. As between Lessor and
Lessee, it is agreed that all insurance payments received as the result of
the occurrence of an Event of Loss will be applied as follows:
(x) if such payments are received with respect to the
Airframe (or the Airframe and the Engines installed thereon), (i)
unless such property is replaced pursuant to the last paragraph
of Section 10(a), so much of such payments remaining, after
reimbursement of Lessor (as provided in Section 7.01 of the Trust
Agreement) and the Owner Participant for reasonable costs and
expenses, as shall not exceed the Termination Value and the other
amounts payable pursuant to Section 10(a) hereof shall be applied
in reduction of Lessee's obligation to pay such Termination Value
and other amounts payable pursuant to Section 10(a) hereof, if
not already paid by Lessee, or, if already paid by Lessee, shall
be applied to reimburse Lessee for its payment of such
Termination Value and such other amounts payable, and the
balance, if any, of such payments remaining thereafter will be
paid over to, or retained by, Lessee (or if directed by Lessee,
any Sublessee); or (ii) if such property is replaced pursuant to
the last paragraph of Section 10(a), such payments shall be paid
over to, or retained by, Lessee (or if directed by Lessee, any
Sublessee), provided that Lessee shall have fully performed or,
concurrently therewith, will fully perform the terms of the last
paragraph of Section 10(a) with respect to the Event of Loss for
which such payments are made; and
(y) if such payments are received with respect to an Engine
under the circumstances contemplated by Section 10(b) hereof, so
much of such payments remaining after reimbursement of Lessor (as
provided in Section 7.01 of the Trust Agreement) and the Owner
Participant for reasonable costs and expenses, shall be paid over
to, or retained by, Lessee (or if directed by Lessee, any
Sublessee), provided that Lessee shall have fully performed or
concurrently therewith will fully perform the terms of Section
10(b) with respect to the Event of Loss for which such payments
are made.
As between Lessor and Lessee, the insurance payments for any
property damage loss to the Airframe or any engine not constituting an
Event of Loss with respect thereto will be applied in payment for repairs
or for replacement property in accordance with the terms of Sections 7 and
8, if not already paid for by Lessee (or any Sublessee), and any balance
(or if already paid for by Lessee (or any Sublessee), all such insurance
proceeds) remaining after compliance with such Sections with respect to
such loss shall be paid to Lessee (or any Sublessee if directed by Lessee).
(2) During any period that the Aircraft is on the ground and not
in operation, Lessee may carry or cause to be carried, in lieu of the
insurance required by clause (1) above, and subject to self-insurance to
the extent permitted by subsection (d) of this Exhibit H, insurance
otherwise conforming with the provisions of said clause (1) except that the
scope of the risks and the type of insurance shall be the same as from time
to time applicable to aircraft owned or leased by Lessee (or, if a Sublease
is then in effect, by Sublessee) of the same type as the Aircraft similarly
on the ground and not in operation, provided that, subject to self-
insurance to the extent permitted by subsection (d) of this Exhibit H,
Lessee shall maintain insurance against risk of loss or damage to the
Aircraft in an amount at least equal to the Termination Value of the
Aircraft during such period that the Aircraft is on the ground and not in
operation.
(3) If Lessee (or any Sublessee) shall at any time operate or
propose to operate the Aircraft, Airframe or any Engine (i) in any area of
recognized hostilities or (ii) on international routes, and war-risk,
hijacking or allied perils insurance is maintained by Lessee (or any
Sublessee) with respect to other aircraft owned and operated by Lessee (or
any Sublessee) on such routes or in such areas, Lessee shall maintain or
cause to be maintained war-risk, hijacking and related perils insurance of
substantially the same type carried by major United States commercial air
carriers operating the same or comparable models of aircraft on similar
routes or in such areas and in no event in an amount less than the
Termination Value.
(c) Reports, etc. Lessee will furnish, or cause to be
furnished, to Lessor, the Indenture Trustee, the Owner Participant and the
Pass Through Trustee, on or before the Delivery Date and on each annual
anniversary date of Lessee's applicable insurance, a report, signed by
Lessee's regular insurance broker or any other independent firm of
insurance brokers reasonably acceptable to Lessor which brokers may be in
the regular employ of Lessee (the "Insurance Brokers"), describing in
reasonable detail the hull and liability insurance (and property insurance
for detached engines and parts) then carried and maintained with respect to
the Aircraft and stating the opinion of such firm that the insurance
complies with the terms hereof; provided, that all information contained in
the foregoing report shall not be made available by Lessor, the Indenture
Trustee or the Owner Participant or the Pass Through Trustee to anyone
except (i) to prospective and permitted transferees of Lessor's, the Owner
Participant's, the Indenture Trustee's or the Pass Through Trustee's
interest or their respective counsel, independent certified public
accountants and independent insurance brokers or other agents, who agree to
hold such information confidential, (ii) to Lessor's, the Owner
Participant's, the Indenture Trustee's or a Pass Through Trustee's counsel
or independent certified public accountants, independent insurance brokers
or agents who agree to hold such information confidential or (iii) as may
be required by any statute, court or administrative order or decree or
governmental ruling or regulation; provided, however that any disclosure
permitted by clause (iii) above shall be made only to the extent necessary
to meet the specific requirements or needs of the Persons to whom such
disclosures are hereby permitted. Lessee will cause such Insurance Broker
to agree to advise Lessor, the Indenture Trustee, the Owner Participant and
the Pass Through Trustee in writing of any act or omission on the part of
Lessee of which it has knowledge and which might invalidate or render
unenforceable, in whole or in part, any insurance on the Aircraft and to
advise in writing at least thirty (30) days (ten (10) days in the case of
war risk and allied perils coverage and ten (10) days notice with respect
to the Electronic Date Recognition Exclusion Limited Coverage Endorsement),
prior to the cancellation or material adverse change of any insurance
maintained pursuant to Section 11, provided that if the notice period
specified above is not reasonably obtainable, the Insurance Broker shall
provide for as long a period of prior notice as shall then be reasonably
obtainable. In addition, Lessee will also cause such Insurance Brokers to
deliver to Lessor, the Indenture Trustee, the Owner Participant and the
Pass Through Trustee, on or prior to the date of expiration of any
insurance policy referenced in a previously delivered certificate of
insurance, a new certificate of insurance, substantially in the same form
as delivered by Lessee to such parties on the Delivery Date except for such
changes in the report or the coverage consistent with the terms hereof. In
the event that Lessee or any Sublessee shall fail to maintain or cause to
be maintained insurance as herein provided, Lessor or the Indenture Trustee
may at its sole option, but shall be under no duty to, provide such
insurance and, in such event, Lessee shall, upon demand, reimburse Lessor
or the Indenture Trustee, as Supplemental Rent, for the cost thereof to
Lessor or the Indenture Trustee, as the case may be; provided, however,
that no exercise by Lessor or the Indenture Trustee, as the case may be, of
said option shall affect the provisions of this Lease, including the
provisions of Section 14(g).
(d) Self-Insurance. Lessee may self-insure by way of
deductible, premium adjustment or franchise provisions or otherwise
(including, with respect to insurance maintained pursuant to subsection (b)
of this Exhibit H, insuring for an amount that is less than the Termination
Value of the Aircraft) the risks required to be insured against pursuant to
Section 11 under a program applicable to all aircraft (whether owned or
leased) in Lessee's fleet, but in no case shall the aggregate amount of
self-insurance in regard to subsection (a) and (b) of this Exhibit H exceed
for any policy year, with respect to all of the aircraft (whether owned or
leased) in Lessee's fleet (including, without limitation, the Aircraft),
the lesser of (i) 50% of the highest replacement value of any single
aircraft in Lessee's fleet or (ii) 1-1/2% of the average aggregate
insurable value (during the preceding policy year) of all aircraft
(including, without limitation, the Aircraft) on which Lessee carries
insurance, unless an insurance broker of national standing shall certify
that the standard among all other major United States airlines is a higher
level of self-insurance, in which case Lessee may insure the Aircraft to
such higher level. In addition to the foregoing right to self-insure,
Lessee (and any Sublessee) may self-insure to the extent of any applicable
mandatory minimum per aircraft (or, if applicable, per annum or other
period) hull or liability insurance deductible customary in the airline
industry imposed by the aircraft hull or liability insurer.
(e) Terms of Policies. Any policies of insurance carried in
accordance with subsection (a) or (b) of this Exhibit H and any policies
taken out in substitution or replacement for any of such policies (A) shall
be amended to name the Additional Insureds as their respective interests
may appear, (B) may provide for the self-insurance to the extent permitted
in subsection (d) of this Exhibit H, (C) shall provide that if the insurers
cancel such insurance for any reason whatever or if any material change is
made in such insurance which adversely affects the interest of the
Additional Insureds, or such insurance shall lapse for non-payment of
premium, such cancellation, lapse or change shall not be effective as to
the Additional Insureds for thirty (30) days (ten (10) days in the case of
war risk and allied perils coverage and ten (10) days in the case of the
Electronic Date Recognition Limited Coverage Endorsement) after issuance to
the Additional Insureds, respectively, of written notice by such insurers
of such cancellation, lapse or change; provided, however, that if any
notice period specified above is not reasonably obtainable, such policies
shall provide for as long a period of prior notice as shall then be
reasonably obtainable, (D) shall provide that in respect of the respective
interests of the Additional Insureds in such policies the insurance shall
not be invalidated by any action or inaction of Lessee (or, if any Sublease
is then in effect, any Sublessee) or any other Person and shall insure the
Additional Insureds regardless of any breach or violation of any warranty,
declaration or condition contained in such policies by Lessee (or, if any
Sublease is then in effect, any Sublessee), (E) shall be primary without
right of contribution from any other insurance which is carried by any
Additional Insured, (F) shall expressly provide that all of the provisions
thereof, except the limits of liability, shall operate in the same manner
as if there were a separate policy covering each insured, (G) shall waive
any right of the insurers to any set-off or counterclaim or any other
deduction, whether by attachment or otherwise, in respect of any liability
of any Additional Insured to the extent of any moneys due to any Additional
Insured, and (H) shall provide that (i) in the event of a loss involving
proceeds in excess of $5,000,000, the proceeds in respect of such loss up
to an amount equal to the Termination Value for the Aircraft shall be
payable to Lessor (or, so long as the Trust Indenture shall not have been
discharged, the Indenture Trustee) (except in the case of a loss with
respect to an Engine installed on an airframe other than the Airframe, in
which case Lessee (or any Sublessee) shall arrange for any payment of
insurance proceeds in respect of such loss to be held for the account of
Lessor (or, so long as the Trust Indenture shall not have been discharged,
the Indenture Trustee) whether such payment is made to Lessee (or any
Sublessee) or any third party), it being understood and agreed that in the
case of any payment to Lessor (or the Indenture Trustee) otherwise than in
respect of an Event of Loss, Lessor (or the Indenture Trustee) shall, upon
receipt of evidence satisfactory to it that the damage giving rise to such
payment shall have been repaired or that such payment shall then be
required to pay for repairs then being made, pay the amount of such payment
(and all earnings thereon) to Lessee or its order, and (ii) the entire
amount of any loss involving proceeds of $5,000,000 or less or the amount
of any proceeds of any loss in excess of the Termination Value for the
Aircraft shall be paid to Lessee or its order unless an Event of Default
shall have occurred and be continuing and the insurers have been notified
thereof by Lessor or the Indenture Trustee.
Exhibit 4(a)(xv)
Exhibit A-2-2
To Note Purchase
Agreement
[LEASE FORM
DEFERRED EQUITY/PREPAID-DEFERRED
RENT STRUCTURE]
LEASE AGREEMENT
(US Airways, Inc. Trust No. N___U_)
Dated as of
-------- --, ----
Between
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Not in its individual capacity except as expressly
provided herein, but solely as Owner Trustee,
Lessor
and
US AIRWAYS, INC.,
Lessee
One Airbus Model A___1 Aircraft
- ------------------------------------------------------------------------------
As set forth in Section 21 hereof, Lessor has assigned to the Indenture
Trustee (as defined herein) certain of its right, title and interest in and
to this Lease. To the extent, if any, that this Lease constitutes chattel
paper (as such term is defined in the Uniform Commercial Code as in effect
in any applicable jurisdiction) no security interest in this Lease may be
created through the transfer or possession of any counterpart other than
the original executed counterpart, which shall be identified as the
counterpart containing the receipt therefor executed by the Indenture
Trustee on the signature page thereof.
- -------------------
1 Insert "A319", "A320" or "A330".
Page
Form Lease
N____U_
TABLE OF CONTENTS TO LEASE AGREEMENT
SECTION 1. DEFINITIONS.............................................1
SECTION 2. ACCEPTANCE AND LEASE....................................1
SECTION 3. TERM AND RENT...........................................1
(a) Basic Term........................................1
(b) Basic Rent........................................1
(c) Adjustments to Basic Rent.........................2
(d) Supplemental Rent.................................3
(e) Payments in General...............................4
(f) Business Day Convention...........................5
SECTION 4. DISCLAIMER; LESSOR'S REPRESENTATIONS, WARRANTIES AND
AGREEMENTS..............................................5
(a) Disclaimer........................................5
(b) Representations, Warranties and Covenants of
First Security Bank...............................6
(c) Lessor's Covenants................................6
(d) Manufacturer's Warranties.........................7
SECTION 5. RETURN OF THE AIRCRAFT..................................7
(a) Condition Upon Return.............................7
(b) Parking and Related Matters.......................7
(c) Return of Other Engines...........................8
(d) Obligations Continue Until Return.................8
SECTION 6. LIENS...................................................8
SECTION 7. REGISTRATION, MAINTENANCE, OPERATION AND REGISTRATION;
POSSESSION AND SUBLEASES; INSIGNIA......................9
(a) Registration, Maintenance, Operation and
Registration............................................9
(1) Registration and Maintenance.................9
(2) Operation...................................10
(3) Reregistration..............................11
(b) Possession and Subleases.........................11
(c) Insignia.........................................16
SECTION 8. REPLACEMENT AND POOLING OF PARTS; ALTERATIONS,
MODIFICATIONS AND ADDITIONS............................17
(a) Replacement of Parts.............................17
(b) Pooling of Parts.................................18
(c) Alterations, Modifications and Additions.........19
(d) Certain Matters Regarding Passenger Convenience
Equipment........................................20
SECTION 9. VOLUNTARY TERMINATION..................................20
(a) Termination Event................................20
(b) Optional Sale of the Aircraft....................21
(c) Termination as to Engines........................23
(d) Special Purchase Options.........................24
SECTION 10. LOSS, DESTRUCTION, REQUISITION, ETC....................25
(a) Event of Loss with Respect to the Aircraft.......25
(b) Event of Loss with Respect to an Engine..........27
(c) Application of Payments from Governmental
Authorities for Requisition of Title, etc........28
(d) Requisition for Use of the Aircraft by the United
States Government or the Government of Registry
of the Aircraft..................................29
(e) Requisition for Use of an Engine by the United
States Government or the Government of Registry
of the Aircraft..................................30
(f) Application of Payments During Existence of
Event of Default.................................30
SECTION 11. INSURANCE..............................................31
(a) Lessee's Obligation to Insure....................31
(b) Additional Insurance by Lessor and Lessee........31
(c) Indemnification by Government in Lieu of
Insurance........................................31
(d) Application of Payments During Existence of an
Event of Default.................................31
SECTION 12. INSPECTION.............................................32
SECTION 13. ASSIGNMENT.............................................33
SECTION 14. EVENTS OF DEFAULT......................................34
SECTION 15. REMEDIES...............................................36
SECTION 16. LESSEE'S COOPERATION CONCERNING CERTAIN MATTERS;
DELIVERY OF FINANCIAL STATEMENTS.......................40
SECTION 17. NOTICES................................................41
SECTION 18. NO SET-OFF, COUNTERCLAIM, ETC..........................42
SECTION 19. RENEWAL OPTIONS; PURCHASE OPTIONS; VALUATION...........43
(a) Renewal Options..................................43
(1) Fixed Renewal Term..........................43
(2) Fair Market Renewal Term....................43
(3) Waiver......................................43
(4) Conditions Precedent, Payment of
Basic Rent..................................44
(5) Termination Value...........................44
(b) Purchase Options.................................44
(c) Valuation........................................45
SECTION 20. BURDENSOME PURCHASE OPTION.............................47
SECTION 21. SECURITY FOR LESSOR'S OBLIGATION TO HOLDERS
OF EQUIPMENT NOTES.....................................48
SECTION 22. LESSOR'S RIGHT TO PERFORM FOR LESSEE...................48
SECTION 23. INVESTMENT OF SECURITY FUNDS; LIABILITY OF
LESSOR LIMITED.........................................49
(a) Investment of Security Funds.....................49
(b) Liability of Lessor Limited......................49
SECTION 24. JURISDICTION...........................................49
SECTION 25. MISCELLANEOUS..........................................50
SECTION 26. SUCCESSOR TRUSTEE......................................50
SECTION 27. LEASE FOR U.S. FEDERAL INCOME TAX LAW PURPOSES;
SECTION 1110 OF BANKRUPTCY CODE........................51
(a) Lease for Federal Income Tax Law Purposes........51
(b) Section 1110 of Bankruptcy Code..................51
EXHIBITS
EXHIBIT A - FORM OF LEASE SUPPLEMENT
EXHIBIT B - 1 PAST DUE RATE DEFINED
EXHIBIT B - 2 BASIC RENT PAYMENTS
EXHIBIT B - 3 BASIC RENT ALLOCATIONS
EXHIBIT B - 4 LESSOR'S COST
EXHIBIT C - TERMINATION VALUE SCHEDULE
EXHIBIT D - EBO AMOUNT
EXHIBIT E - RENT RECALCULATION AND INDEMNIFICATION
VERIFICATION
EXHIBIT F - SCHEDULE OF DOMICILES OF PERMITTED SUBLESSEES
EXHIBIT G - RETURN CONDITIONS
EXHIBIT H - INSURANCE
Form Lease
N____U_
LEASE AGREEMENT
(US Airways, Inc. Trust No. N___U_)
This LEASE AGREEMENT (US Airways, Inc. Trust No. N___U_), dated
as of __________ __, ____, between FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual capacity, except as expressly provided
herein, but solely as Owner Trustee under the Trust Agreement (as defined
in Annex A hereto) (in such capacity, "Lessor"), and US AIRWAYS, INC., a
corporation organized and existing pursuant to the laws of the State of
Delaware ("Lessee");
W I T N E S S E T H:
SECTION 1. DEFINITIONS. Capitalized terms used but not defined
herein shall have the respective meanings set forth or incorporated by
reference, and shall be construed and interpreted in the manner described,
in Annex A.
SECTION 2. ACCEPTANCE AND LEASE. Lessor hereby agrees (subject
to satisfaction of the conditions set forth in Section 4(a) of the
Participation Agreement) to accept the transfer of title from and
simultaneously to lease to Lessee hereunder, and Lessee hereby agrees
(subject to satisfaction of the conditions set forth in Section 4(b) of the
Participation Agreement) to lease from Lessor hereunder, the Aircraft as
evidenced by the execution by Lessor and Lessee of a Lease Supplement
leasing the Aircraft hereunder. Lessee hereby agrees that such acceptance
of the Aircraft by Lessor shall, without further act, irrevocably
constitute acceptance by Lessee of such Aircraft for all purposes of this
Lease.
SECTION 3. TERM AND RENT.
(a) Basic Term. The Basic Term shall commence on the Delivery
Date and end on the Basic Term Expiration Date.
(b) Basic Rent. On each Rent Payment Date, Basic Rent shall be
due and payable and Lessee shall pay Basic Rent in Dollars in an amount
equal to Lessor's Cost multiplied by the percentage for such Rent Payment
Date specified on Exhibit B-2. Each payment of Basic Rent shall be final
and, absent manifest error, Lessee shall not seek, or claim any right, to
recover all or any part of such payment from Lessor or any other Person for
any reason whatsoever. Basic Rent shall be allocated to each Lease Period
in the amounts set forth for such Lease Period on Exhibit B-3 under the
caption "Basic Rent Allocation." [Each installment of Basic Rent shall be
allocated to the Lease Period(s) specified under the caption "Timing of
Payments of Allocated Rent" on Exhibit B-3.]
(c) Adjustments to Basic Rent.
(i) In the event of a refinancing as contemplated by
Section 16 of the Participation Agreement, then the Basic Rent
percentages set forth in Exhibit B, the Termination Value percentages
set forth in Exhibit C and the EBO Amount set forth on Exhibit D
shall be recalculated (upwards or downwards) by the Owner Participant
as contemplated by such Section to (1) maintain the Owner
Participant's Net Economic Return and (2) to the extent possible
consistent with clause (1) hereof, minimize the Net Present Value of
Rents to Lessee;
(ii) In the event that Lessee elects to satisfy any
indemnity obligation under the Tax Indemnity Agreement, then the
Basic Rent percentages set forth in Exhibit B, the Termination Value
percentages set forth in Exhibit C and the EBO Amount set forth on
Exhibit D shall be recalculated (upwards or downwards) by the Owner
Participant, using the same methods and assumptions (except to the
extent such assumptions shall be varied to take into account the Loss
(as defined in the Tax Indemnity Agreement) that is the subject of
such indemnification and any prior or contemporaneous Loss) used to
calculate the Basic Rent percentages, the Termination Value
percentages and the EBO Amount on the Delivery Date, in order to (1)
maintain the Owner Participant's Net Economic Return and (2) to the
extent possible consistent with clause (1) hereof, minimize the Net
Present Value of Rents to Lessee.
(iii)Whenever Basic Rent is recalculated pursuant to this
Section 3(c), the Owner Participant shall redetermine the Termination
Value percentages set forth in Exhibit C and the EBO Amount set forth
in Exhibit D in a manner consistent with such recalculation.
(iv) Any recalculation of Basic Rent and Termination
Value percentages pursuant to this Section 3(c) shall be determined
by the Owner Participant and shall be subject to the verification
procedures set forth in Exhibit E hereto. Such recalculated Basic
Rent and Termination Value percentages shall be set forth in a Lease
Supplement or an amendment to this Lease.
(v) Anything contained in the Participation Agreement or
this Lease to the contrary notwithstanding, (I) each installment of
Basic Rent payable, whether or not adjusted in accordance with this
Section 3(c), together with any Advance or payment made by Lessee
pursuant to Section 3(g) and payment of Deferred Equity Amount made
by the Owner Participant under Section 7(cc) of the Participation
Agreement(2) shall be, under any circumstances and in any event, in an
amount at least sufficient for Lessor to pay in full, on the date on
which such installment of Basic Rent [, Advance or Deferred Equity
Amount](3) is due, any payments then scheduled to be made on account of
the principal of, if any, and interest on the Equipment Notes and
(II) the amount of Termination Value payable on any Termination Date,
Loss Payment Date or, in the case of payments under Sections 15 and
20, Rent Payment Date, whether or not adjusted in accordance with
this Section 3(c), together with all other amounts payable hereunder
by Lessee on such date and the amount of the premium, if any, payable
by Lessor on the Equipment Notes, shall be, under any circumstances
and in any event, in an amount at least sufficient for Lessor to pay
in full, on such Termination Date, Loss Payment Date or Rent Payment
Date, the outstanding principal of, premium, if any, and interest on
the Equipment Notes. It is agreed that no installment of Basic Rent,
payment of Termination Value or EBO Amount shall be increased or
adjusted by reason of (i) any attachment or diversion of Rent on
account of (A) Lessor Liens or (B) any Loan Participant Lien or other
Lien on or against the Trust Estate, any part thereof or the
Operative Documents arising as a result of claims against the
Indenture Trustee not related to the transactions contemplated by the
Operative Documents, (ii) any modification of the payment terms of
the Equipment Notes made without the prior written consent of Lessee
or (iii) the acceleration of any Equipment Note or Equipment Notes
due to the occurrence of an Indenture Event of Default which does not
constitute a Lease Event of Default.
- -------------------
2 For deferred equity transactions only.
3 For deferred equity transactions only.
(vi) All adjustments to Basic Rent under this Section
3(c) shall be subject to verification pursuant to Exhibit E.
(d) Supplemental Rent. Lessee shall pay (or cause to be paid)
promptly to Lessor, or to whomsoever shall be entitled thereto, any and all
Supplemental Rent constituting Termination Value and Make-Whole Amount as
the same shall become due and owing and all other amounts of Supplemental
Rent within five Business Days (5) days after demand or within such other
relevant period as may be provided in any Operative Document, and in the
event of any failure on the part of Lessee to pay any Supplemental Rent
when due, Lessor shall have all rights, powers and remedies provided for
herein or in any other Operative Document or by law or equity or otherwise
in the case of nonpayment of Basic Rent. Lessee shall pay as Supplemental
Rent the Make-Whole Amount, if any, due pursuant to Section 2.10(b) or
Section 2.11 of the Trust Indenture in connection with a prepayment of the
Equipment Notes upon redemption of such Equipment Notes in accordance with
Section 2.10(b) or Section 2.11 of the Trust Indenture. Lessee also will
pay to Lessor, or to whomsoever shall be entitled thereto, on demand, as
Supplemental Rent, to the extent permitted by applicable law, interest at
the Past Due Rate on any part of any installment of Basic Rent not paid
when due for any period for which the same shall be overdue and on any
payment of Supplemental Rent not paid when due for the period until the
same shall be paid.
(e) Payments in General. All payments of Rent shall be made
directly by Lessee (whether or not any Sublease shall be in effect) by wire
transfer of immediately available funds prior to 11:00 a.m., New York time,
on the date of payment, to Lessor at its account at First Security Bank,
National Association, 79 South Main Street, 3rd Floor, Salt Lake City, Utah
84111, ABA No. 124-0000-12, Account No.___________, Attention: Corporate
Trust Department, Credit US Airways/US Airways, Inc. Trust No. N___U_ (or
such other account of Lessor in the continental United States as Lessor
shall direct in a notice to Lessee at least ten (10) Business Days prior to
the date such payment of Rent is due); provided that so long as the Trust
Indenture shall not have been fully discharged, Lessor hereby irrevocably
directs and Lessee agrees, that, unless the Indenture Trustee shall
otherwise direct, all Rent payable to Lessor and assigned to the Indenture
Trustee pursuant to the Trust Indenture shall be paid prior to 11:00 a.m.,
New York time on the due date thereof in funds of the type specified in
this Section 3(e) directly to the Indenture Trustee at its account at State
Street Bank and Trust Company of Connecticut, National Association, 225
Asylum Street, Hartford, Connecticut 06103, ABA No. _________, Account No.
- ----------, Reference: US Airways, Inc. ___-1EETC/US Airways, Inc. Trust
No. N___U_ (or such other account of the Indenture Trustee in the
continental United States as the Indenture Trustee shall direct in a notice
to Lessee at least ten (10) Business Days prior to the date such payment of
Rent is due). Lessor hereby directs and Lessee agrees that all payments of
Supplemental Rent owing to the Indenture Trustee or to a Loan Participant
or any other Person (other than the Excluded Payments payable to the Owner
Participant) pursuant to the Participation Agreement shall be made in
Dollars in immediately available funds prior to 11:00 a.m., New York time,
on the due date thereof at the office of the Indenture Trustee or at such
other office of such other financial institution located in the continental
United States as the party entitled thereto may so direct at least ten (10)
Business Days prior to the due date thereof. All payments of Supplemental
Rent payable to the Owner Participant, to the extent that such amounts
constitute Excluded Payments, shall be made in Dollars in immediately
available funds prior to 11:00 a.m., New York time, on the due date
thereof, to the account of the Owner Participant specified in Schedule I to
the Participation Agreement (or to such other account as may be specified
in writing by the Owner Participant from time to time).
(f) Business Day Convention. Notwithstanding anything to the
contrary contained herein, if any date on which a payment of Rent 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 with the same force and effect as if made on such scheduled date and
(provided such payment is made on such next succeeding Business Day) no
interest shall accrue on the amount of such payment from and after such
scheduled date.
(g) [Certain Advances, Deductions of Advances. On the Initial
Rent Payment Date, prior to noon New York time, Lessee shall advance to the
Indenture Trustee on behalf of the Owner Trustee an amount that, together
with the Basic Rent otherwise due on such date, will be equal to the
scheduled payments of principal and interest then due on the Equipment
Notes (the amount of such advance to be made by Lessee shall herein be
called the "Advance"); provided that, Lessee shall be relieved of such
obligation if, on the Initial Rent Payment Date, the Indenture Trustee
shall have received the amount payable by the Owner Participant pursuant to
Section 7(cc) of the Participation Agreement. In the event Lessee makes an
Advance pursuant to this Section 3(g) and is not reimbursed therefor by the
Owner Participant as provided in Section 7(cc) of the Participation
Agreement, subject to the limitation of Section 3(c)(v), Lessee shall be
entitled to offset and deduct (without duplication) against each succeeding
payment (other than as limited by the proviso to this sentence) due from
Lessee to Persons other than any Note Holder, the Indenture Trustee and
Lessor in its individual capacity (including, without limitation, Basic
Rent, payments due under Sections 5, 9, 10, 15, 19 and 20 hereof, payments
due (only to the extent due to the Owner Participant) under the Tax
Indemnity Agreement and payments due (only to the extent due to the Owner
Participant and its Related Indemnitee Group and the Owner Trustee, but
with respect to the Owner Trustee only to the extent such payments are not
attributable to the principal or interest on the Equipment Notes) under
Section 6 of the Participation Agreement) the amounts (including interest
on such amounts at the Base Rate plus 2% per annum) due and owing by the
Owner Participant to Lessee from time to time under Section 7(cc) of the
Participation Agreement until Lessee has been fully reimbursed for such
amounts (including interest on such amounts at the Base Rate plus 2%);
provided that, in the case of any payment due from Lessee which is
distributable under the terms of the Trust Indenture, Lessee's right of
offset and deduction shall be limited to the amounts distributable to
Lessor thereunder (and shall not include any amounts distributable to the
Indenture Trustee in its individual capacity or to any Note Holder), as
acknowledged by the Indenture Trustee upon 10 days' prior written notice
from Lessee to the Indenture Trustee, accompanied by a certificate of a
responsible officer of Lessee certifying that the conditions precedent to
Lessee's right to effect such an offset have been met. No such offset or
aggregate combined effect of separate offsets shall reduce the amount of
any installment of Basic Rent to an amount that is insufficient to pay in
full the payments then required to be made on account of the principal or
interest on the Equipment Notes. Lessee also will pay to the Indenture
Trustee on demand, to the extent permitted by applicable law, interest at
the Past Due Rate on any part of any Advance required to be made by Lessee
pursuant to this Section 3(g) which is not paid when required to be made
for any period for which the same shall be overdue.] (4)
- -------------------
4 For deferred equity deals only.
SECTION 4. DISCLAIMER; LESSOR'S REPRESENTATIONS,
WARRANTIES AND AGREEMENTS.
(a) Disclaimer. LESSOR LEASES AND LESSEE TAKES THE AIRCRAFT AND
EACH PART THEREOF "AS-IS," "WHERE-IS." EXCEPT AS EXPRESSLY PROVIDED HEREIN,
NEITHER LESSOR, THE INDENTURE TRUSTEE NOR ANY PARTICIPANT MAKES, HAS MADE
OR SHALL BE DEEMED TO HAVE MADE, AND EACH HEREBY EXPRESSLY DISCLAIMS AND
WILL BE DEEMED TO HAVE EXPRESSLY DISCLAIMED, ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS, WORKMANSHIP,
CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR USE OR A
PARTICULAR PURPOSE OF THE AIRCRAFT 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 WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO
THE AIRCRAFT OR ANY PART THEREOF.
(b) Representations, Warranties and Covenants of First Security
Bank. First Security Bank, National Association, in its individual
capacity, (i) represents and warrants that on the Delivery Date, Lessor
shall have received whatever title to the Aircraft was conveyed to it by
Lessee, (ii) represents and warrants that on the Delivery Date the Aircraft
shall be free of Lessor Liens attributable to it, (iii) covenants that
neither it nor any Person claiming by, through or under it will, through
its own actions or inactions, interfere in Lessee's or any Sublessee's
continued possession, use, operation and quiet enjoyment of the Aircraft
during the Term unless an Event of Default has occurred and is continuing
and this Lease has been duly declared in default, and this Lease shall not
be terminated except as expressly provided herein, (iv) covenants that it
will not directly or indirectly create, incur, assume or suffer to exist
any Lessor Lien attributable to it on or with respect to the Airframe or
any Engine or any portion of the Trust Estate and (v) represents and
warrants that it is a Citizen of the United States without making use of a
voting trust, voting powers agreement or similar arrangement, and agrees
that if at any time it shall cease to be a Citizen of the United States
without making use of a voting trust, voting powers agreement or similar
arrangement it will promptly resign as Owner Trustee (if and so long as
such citizenship is necessary under the Transportation Code as in effect at
such time or, if it is not necessary, if and so long as the Owner Trustee's
citizenship would have any material adverse effect on the Loan
Participants, the Owner Participant or Lessee), effective upon the
appointment of a successor Owner Trustee in accordance with Section 9.01 of
the Trust Agreement.
(c) Lessor's Covenants. Lessor (i) covenants that neither it
nor any Person claiming by, through or under it will, through its own
actions or inactions, interfere in Lessee's or any Sublessee's continued
possession, use, operation and quiet enjoyment of the Aircraft during the
Term unless an Event of Default has occurred and is continuing and this
Lease has been duly declared in default, and this Lease shall not be
terminated except as expressly provided herein and (ii) covenants that it
will not directly or indirectly create, incur, assume or suffer to exist
any Lessor Lien attributable to it on or with respect to the Airframe or
any Engine.
(d) Manufacturer's Warranties. None of the provisions of this
Lease shall be deemed to amend, modify or otherwise affect the
representations, warranties or other obligations (express or implied) of
the Seller, the Manufacturer, any subcontractor or supplier of the
Manufacturer with respect to the Airframe, the Engines or any Parts, or to
release the Seller, the Manufacturer, or any such subcontractor or
supplier, from any such representation, warranty or obligation. Unless an
Event of Default shall have occurred and be continuing under Section 14 and
this Lease shall have been declared in default, Lessor agrees to make
available to Lessee such rights as Lessor may have under any warranty with
respect to the Aircraft made by the Seller, the Manufacturer or any
affiliate thereof or any of its subcontractors or suppliers and any other
claims against the Seller, the Manufacturer or any affiliate thereof, or
any such subcontractor or supplier with respect to the Aircraft, all
pursuant to and in accordance with the terms of the Purchase Agreement
Assignment.
SECTION 5. RETURN OF THE AIRCRAFT.
(a) Condition Upon Return. Lessee shall comply with each of the
provisions of Exhibit G, which provisions are hereby incorporated by this
reference as if set forth in full herein.
(b) Parking and Related Matters. Unless Lessee has elected to
purchase the Aircraft in accordance with the terms hereof, if Lessor gives
written notice to Lessee not less than sixty (60) days nor more than one
hundred eighty (180) days prior to the end of the Term requesting storage
of the Aircraft upon its return hereunder, Lessee will provide Lessor, or
cause Lessor to be provided, with outdoor parking facilities for the
Aircraft for a period up to thirty (30) days, commencing on the date of
such return, at such storage facility in the forty eight (48) contiguous
states of the United States as Lessee may select; provided that such
location shall be a location generally used for the parking of commercial
aircraft by aircraft owners or operators. Notwithstanding subsection (a) of
Exhibit G, such location shall be deemed to be the return location of the
Aircraft for purposes of such Exhibit G. Such parking shall be at Lessor's
risk and expense and Lessor shall pay all applicable storage, maintenance
and insurance fees and expenses. Lessee's obligation to arrange parking
shall be subject to Lessee and Lessor entering into an agreement prior to
the commencement of the storage period with the storage facility providing,
among other things, that Lessor shall bear all maintenance charges and
other costs incurred relating to such storage.
(c) Return of Other Engines. In the event that any Engine owned
by Lessor shall not be installed on the Airframe at the time of return
hereunder, Lessee shall be required to return the Airframe hereunder with
an Acceptable Alternate Engine meeting the requirements of, and in
accordance with, Section 10 and Exhibit G hereto. Thereupon, Lessor will
transfer to Lessee the Engine constituting part of such Aircraft but not
installed on such Airframe at the time of the return of the Airframe.
(d) Obligations Continue Until Return. If Lessee shall, for any
reason, fail to return the Aircraft at the time specified herein, all
obligations of Lessee under this Lease shall continue in effect with
respect to the Aircraft until the Aircraft is returned to Lessor and Lessee
shall pay to Lessor an amount equal to the average daily Basic Rent payable
by Lessee during the Term for each day after the end of the Term to but
excluding the day of such return; provided, however, that Lessee shall not
be responsible for Lessor's failure to accept return of the Aircraft in
accordance with this Section 5 in a timely manner or for any Rent with
respect to periods after Lessee has tendered the Aircraft for return in
accordance with this Lease. Any Rent owed to Lessor pursuant to this
Section 5(d) shall be payable upon acceptance of the Aircraft by Lessor or
on the last day of each calendar month following the last day of the Term
if the Aircraft has not been accepted earlier.
SECTION 6. LIENS. Lessee will not directly or indirectly
create, incur, assume or suffer to exist any Lien on or with respect to the
Aircraft, title thereto or any interest therein or in this Lease, except
(i) the respective rights of Lessor as owner of the Aircraft and Lessee as
herein provided, the Lien of the Trust Indenture, the rights of any
Sublessee under a sublease permitted hereunder and any other rights of any
Person existing pursuant to the Operative Documents, (ii) the rights of
others under agreements or arrangements to the extent permitted by the
terms of Sections 7(b) and 8(b) hereof, (iii) Lessor Liens, Loan
Participant Liens and Indenture Trustee's Liens, (iv) Liens for Taxes of
Lessee (or any Sublessee) either not yet due or being contested in good
faith by appropriate proceedings so long as such proceedings do not involve
any material danger of the sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (v) materialmen's, mechanics', workmen's,
repairmen's, employees' or other like Liens arising in the ordinary course
of Lessee's (or, if a Sublease is then in effect, Sublessee's) business
(including those arising under maintenance agreements entered into in the
ordinary course of business) securing obligations that are not overdue for
a period of more than sixty (60) days or are being contested in good faith
by appropriate proceedings so long as such proceedings do not involve any
material danger of the sale, forfeiture or loss of the Airframe or any
Engine or any interest therein, (vi) Liens arising out of any judgment or
award against Lessee (or any Sublessee), unless the judgment secured shall
not, within sixty (60) days after the entry thereof, have been discharged,
vacated, reversed or execution thereof stayed pending appeal or shall not
have been discharged, vacated or reversed within sixty (60) days after the
expiration of such stay, (vii) any other Lien with respect to which Lessee
(or any Sublessee) shall have provided a bond, cash collateral or other
security adequate in the reasonable opinion of Lessor, and (viii) Liens
approved in writing by Lessor. Lessee will promptly, at its own expense,
take (or cause to be taken) such actions as may be necessary duly to
discharge any such Lien not excepted above if the same shall arise at any
time.
SECTION 7. REGISTRATION, MAINTENANCE, OPERATION AND
REGISTRATION; POSSESSION AND SUBLEASES; INSIGNIA.
(a) Registration, Maintenance, Operation and Registration.
(1) Registration and Maintenance. Lessee, at its own cost
and expense, shall (or shall cause any Sublessee to): (A) forthwith
upon the delivery thereof hereunder, cause the Aircraft to be duly
registered in the name of Lessor, and, subject to clause 3 of this
Section 7(a) and Section 7(d) of the Participation Agreement, to
remain duly registered in the name of Lessor under the Transportation
Code, provided that Lessor shall execute and deliver all such
documents as Lessee (or any Sublessee) may reasonably request for the
purpose of effecting and continuing such registration, and shall not
register the Aircraft or permit the Aircraft to be registered under
any laws other than the Transportation Code at any time except as
provided in Section 7(d) of the Participation Agreement and, unless
the Lien of the Trust Indenture shall have been discharged, shall
cause the Trust Indenture to be duly recorded and maintained of
record as a first mortgage on the Aircraft; (B) maintain, service,
repair and/or overhaul (or cause to be maintained, serviced, repaired
and/or overhauled) the Aircraft so as to keep the Aircraft in as good
an operating condition as when delivered by the Seller to Lessee,
ordinary wear and tear excepted, and as may be necessary to enable
the applicable airworthiness certification for the Aircraft to be
maintained in good standing at all times (other than during temporary
periods of storage or during maintenance or modification permitted
hereunder) under the Transportation Code, except when all of Lessee's
Airbus Model A___(5) aircraft powered by engines of the same type as
those with which the Airframe shall be equipped at the time of such
grounding and registered in the United States have been grounded by
the FAA (although such certification need actually be maintained only
during such periods as the Aircraft is registered in the United
States), or the applicable laws of any other jurisdiction in which
the Aircraft may then be registered from time to time in accordance
with Section 7(d) of the Participation Agreement, utilizing, except
during any period that a Sublease is in effect, the same manner and
standard of maintenance, service, repair or overhaul used by Lessee
with respect to similar aircraft operated by Lessee in similar
circumstances and utilizing, during any period that a Sublease is in
effect, the same manner and standard of maintenance, service, repair
or overhaul used by the Sublessee with respect to similar aircraft
operated by the Sublessee in similar circumstances; (C) maintain or
cause to be maintained in English all records, logs and other
materials required to be maintained in respect of the Aircraft by the
FAA or the applicable regulatory agency or body of any other
jurisdiction in which the Aircraft may then be registered; and (D)
promptly furnish or cause to be furnished to Lessor and the Owner
Participant such information as may be required to enable Lessor to
file any reports required to be filed by Lessor or the Owner
Participant with any governmental authority because of Lessor's
ownership of the Aircraft.
- -------------------
(5) Insert "A319", "A320" or "A330", as applicable.
(2) Operation. Lessee will not maintain, use, service,
repair, overhaul or operate the Aircraft (or permit any Sublessee to
maintain, use, service, repair, overhaul or operate the Aircraft) in
violation of any law or any rule, regulation, order or certificate of
any government or governmental authority (domestic or foreign) having
jurisdiction over the Aircraft, or in violation of any airworthiness
certificate, license or registration relating to the Aircraft issued
by any such authority, except to the extent Lessee (or, if a Sublease
is then in effect, any Sublessee) is contesting in good faith the
validity or application of any such law, rule, regulation or order in
any reasonable manner which does not involve any material risk of
sale, forfeiture or loss of the Aircraft. Lessee will not operate the
Aircraft, or permit any Sublessee to operate the Aircraft, in any
area excluded from coverage by any insurance required by the terms of
Section 11; provided, however, that the failure of Lessee to comply
with the provisions of this sentence shall not give rise to an Event
of Default hereunder if indemnification complying with Section 11(c)
has been provided or where such failure is attributable to
extraordinary circumstances involving an isolated occurrence or
series of incidents not in the ordinary course of the regular
operations of Lessee (or any Sublessee) such as a hijacking, medical
emergency, equipment malfunction, weather condition, navigational
error or other causes beyond the reasonable control of Lessee (or any
Sublessee).
(3) Reregistration. At any time after the Depreciation
Period, Lessor, upon Lessee's compliance with all of the terms of
Section 7(d) of the Participation Agreement, shall, at the request
and sole expense of Lessee, cooperate with Lessee to take all actions
required to change the registration of the Aircraft to another
country.
(b) Possession and Subleases. Lessee will not, without the
prior written consent of Lessor, sublease or otherwise in any manner
deliver, transfer or relinquish possession of the Airframe or any Engine or
install or permit any Engine to be installed on any airframe other than the
Airframe or enter into any Wet Lease, and so long as Lessee (or any
Sublessee) shall comply with the provisions of Section 7(a) and Section 11
hereof, Lessee may (or may permit any Sublessee to), without the prior
written consent of Lessor:
(i) subject the Airframe and the Engines or engines
then installed thereon to interchange agreements or any Engine to
pooling or similar arrangements, in each case customary in the
airline industry and entered into by Lessee (or, if a Sublease is
then in effect, by Sublessee) in the ordinary course of its business;
provided that (A) no such agreement or arrangement contemplates or
requires the transfer of title to the Airframe, (B) if Lessor's title
to any Engine shall be divested under any such agreement or
arrangement, such divestiture shall be deemed to be an Event of Loss
with respect to such Engine and Lessee shall (or shall cause
Sublessee to) comply with Section 10(b) hereof in respect thereof,
and (C) any interchange agreement to which the Airframe may be
subject shall be with a U.S. Air Carrier or a Foreign Air Carrier.
(ii)deliver possession of the Airframe or any Engine
to the manufacturer thereof (or for delivery thereto) or to any
organization (or for delivery thereto) for testing, service, repair,
maintenance or overhaul work on the Airframe or Engine or any part of
any thereof or for alterations or modifications in or additions to
such Airframe or Engine to the extent required or permitted by the
terms of Section 8(c) hereof;
(iii) install an Engine on an airframe owned by
Lessee (or any Sublessee) free and clear of all Liens, except: (A)
Permitted Liens and those which apply only to the engines (other than
Engines), appliances, parts, instruments, appurtenances, accessories,
furnishings and other equipment (other than Parts) installed on such
airframe (but not to the airframe as an entirety), (B) the rights of
third parties under interchange agreements or pooling or similar
arrangements which would be permitted under clause (i) above,
provided that Lessor's title to such Engine and, if any Equipment
Notes shall be outstanding, the first priority Lien of the Trust
Indenture shall not be divested or impaired as a result thereof and
(C) mortgage liens or other security interests, provided that (as
regards this clause (C)) the documents creating such mortgage liens
or other security interests (or, if applicable, another written
agreement governing such mortgage liens or other security interests)
effectively provide that such Engine shall not become subject to the
lien of such mortgage or security interest, notwithstanding the
installation thereof on such airframe;
(iv) install an Engine on an airframe leased to
Lessee (or any Sublessee) or purchased by Lessee (or any Sublessee)
subject to a conditional sale or other security agreement, provided
that (x) such airframe is free and clear of all Liens, except: (A)
the rights of the parties to the lease or conditional sale or other
security agreement covering such airframe, or their assignees, and
(B) Liens of the type permitted by clause (iii) of this paragraph (b)
and (y) such lease, conditional sale or other security agreement
effectively provides that such Engine shall not become subject to the
lien of such lease, conditional sale or other security agreement,
notwithstanding the installation thereof on such airframe;
(v) install an Engine on an airframe owned by Lessee
(or any Sublessee), leased to Lessee (or any Sublessee) or purchased
by Lessee (or any Sublessee) subject to a conditional sale or other
security agreement under circumstances where neither clause (iii) nor
clause (iv) of this paragraph (b) is applicable, provided that such
installation shall be deemed an Event of Loss with respect to such
Engine and Lessee shall (or shall cause any Sublessee to) comply with
Section 10(b) hereof in respect thereof, Lessor not intending hereby
to waive any right or interest it may have to or in such Engine under
applicable law until compliance by Lessee with such Section 10(b);
(vi) to the extent permitted by Section 8(b) hereof,
subject any appliances, Parts or other equipment owned by Lessor and
removed from the Airframe or any Engine to any pooling arrangement
referred to in Section 8(b) hereof;
(vii) subject (or permit any Sublessee to subject) the
Airframe or any Engine to the Civil Reserve Air Fleet Program and
transfer (or permit any Sublessee to transfer) possession of the
Airframe or any Engine to the United States Government or any
instrumentality or agency thereof pursuant to the Civil Reserve Air
Fleet Program, so long as Lessee (or any Sublessee) shall (A)
promptly notify Lessor upon subjecting the Airframe or any Engine to
the Civil Reserve Air Fleet Program in any contract year and provide
Lessor with the name and address of the Contracting Office
Representative for the Air Mobility Command of the United States Air
Force to whom notice must be given pursuant to Section 15 hereof, and
(B) promptly notify Lessor upon transferring possession of the
Airframe or any Engine to the United States of America or any agency
or instrumentality thereof pursuant to such program;
(viii) for a period not to extend beyond the end of
the Term, enter into a Wet Lease for the Airframe and Engines or
engines then installed thereon with any third party; provided that if
Lessee (or any Sublessee) shall enter into any Wet Lease for a period
of more than one year (including renewal options) Lessee shall
provide Lessor written notice of such Wet Lease (such notice to be
given prior to entering into such Wet Lease, if practicable, but in
any event promptly after entering into such Wet Lease);
(ix) for a period not to extend beyond the end of the
Term, transfer possession of the Airframe or any Engine to the United
States Government or any instrumentality or agency thereof pursuant
to a contract, a copy of which shall be provided to Lessor; or
(x) Lessee may, at any time in its sole discretion,
enter into any sublease with (A) any Person domiciled in the United
States, (B) after the Depreciation Period, any Permitted Sublessee or
(C) after the Depreciation Period, any other Person approved in
writing by Lessor, which approval shall not be unreasonably withheld;
provided, however, that no sublease entered into pursuant to this
clause (x) shall extend beyond the expiration of the Basic Term or
any Renewal Term then in effect unless Lessee shall have irrevocably
committed to purchase the Aircraft or renew the Lease in accordance
with the terms hereof at the end of the Basic Term or Renewal Term,
as the case may be, to a date beyond the latest permissible
expiration date of such sublease; provided, further, with respect to
a sublease under subclauses (B) or (C) of this clause (x), Lessee
shall deliver to Lessor an opinion of counsel to the effect that (I)
the obligations of Lessee and the rights and remedies of the Lessor
under the Lease remain valid, binding and (subject to customary
bankruptcy and equitable remedies exceptions and to other exceptions
customary in such Opinions) enforceable; (II) the terms of the
sublease constitute valid and binding obligations of the Sublessee
and (subject to customary bankruptcy and equitable remedies
exceptions and to other exceptions customary in such Opinions)
enforceable against Sublessee (it being understood that such opinion
may be an opinion as to the form of the Sublease only and may assume
due authorization, execution, delivery, requisite approvals and
absence of conflicts with laws, contracts or organizational
documents) under the laws of the jurisdiction governing the sublease,
(III) that there is no tort liability of the owner of an aircraft not
in possession thereof under the laws of the jurisdiction of the
proposed sublessee other than tort liability which might have been
imposed on such owner under the laws of the United States or any
state thereof (it being understood that in the event such opinion
cannot be given such opinion requirement shall be waived if insurance
reasonably satisfactory to Lessor, in its individual capacity, is
provided at Lessee's expense), and (IV) unless Lessee shall have
agreed to provide insurance covering the risk of requisition of use
of the Aircraft by the government of the jurisdiction of the proposed
sublessee reasonably satisfactory to the Owner Participant, that the
laws of such jurisdiction require fair compensation by the government
of such jurisdiction payable in currency freely convertible into
Dollars for the loss of use of the Aircraft in the event of the
requisition by such government of such use; and provided finally
that, with respect to any sublease to any Affiliate of Lessee, (I)
such sublessee shall be a Certificated Air Carrier and (II) Lessee
shall deliver to Lessor an opinion of counsel to the effect that
Lessee would be entitled to the benefits of Section 1110 of the
Bankruptcy Code with respect to the Aircraft if such Affiliate were
to be a debtor in a case under Chapter 11 of the Bankruptcy Code,
such opinion to be subject to customary assumptions and
qualifications. Lessee shall provide Lessor with a copy of any
sublease which has a term of more than one (1) year.
The rights of any Sublessee or other transferee who receives
possession by reason of a transfer permitted by this paragraph (b) (other
than the transfer of an Engine which is deemed an Event of Loss) shall be
subject and subordinate to, and any Sublease permitted by this paragraph
(b) shall be expressly subject and subordinate to, all the terms of this
Lease and Lessor's (and so long as the Trust Indenture is in effect, the
Indenture Trustee's (as Lessor's assignee) rights to repossess and to void
such Sublease upon such repossession, and Lessee shall remain primarily
liable hereunder for the performance of all of the terms of this Lease, and
the terms of any such Sublease shall not permit any Sublessee to take any
action not permitted to be taken by Lessee in this Lease with respect to
the Aircraft. No pooling agreement, sublease or other relinquishment of
possession of the Airframe or any Engine or Wet Lease shall in any way
discharge or diminish any of Lessee's obligations to Lessor hereunder or
constitute a waiver of Lessor's rights or remedies hereunder. Lessor
agrees, for the benefit of Lessee (and any Sublessee) and for the benefit
of any mortgagee or other holder of a security interest in any engine
(other than an Engine) owned by Lessee (or any Sublessee), any lessor of
any engine (other than an Engine) leased to Lessee (or any Sublessee) and
any conditional vendor of any engine (other than an Engine) purchased by
Lessee (or any Sublessee) subject to a conditional sale agreement or any
other security agreement, that no interest shall be created hereunder in
any engine so owned, leased or purchased and that none of Lessor, its
successors or assigns will acquire or claim, as against Lessee (or any
Sublessee) or any such mortgagee, lessor or conditional vendor or other
holder of a security interest or any successor or assignee of any thereof,
any right, title or interest in such engine as the result of such engine
being installed on the Airframe.
Any Wet Lease or similar arrangement under which Lessee
maintains operational control of the Aircraft shall not constitute a
delivery, transfer or relinquishment of possession of the Aircraft for
purposes of this section. Lessor acknowledges that any consolidation or
merger of Lessee or conveyance, transfer or lease of all or substantially
all of Lessee's assets otherwise permitted by the Operative Documents shall
not be prohibited by this Section.
(c) Insignia. On or prior to the Delivery Date, or as soon as
practicable thereafter, Lessee agrees to affix and maintain (or cause to be
affixed and maintained), at its expense, in the cockpit of the Airframe
adjacent to the airworthiness certificate therein and on each Engine a
nameplate bearing the inscription:
Leased From
First Security Bank, National Association, as Owner Trustee, Lessor
and, for so long as the Airframe and each Engine shall be subject to the
Lien of the Trust Indenture, bearing the following additional inscription:
Mortgaged To
State Street Bank and Trust Company of Connecticut, National Association,
as Indenture Trustee
(such nameplate to be replaced, if necessary, with a nameplate reflecting
the name of any successor Lessor or successor Indenture Trustee, in each
case as permitted under the Operative Documents). Except as above provided,
Lessee will not allow the name of any Person to be placed on the Airframe
or on any Engine as a designation that might be interpreted as a claim of
ownership; provided that nothing herein contained shall prohibit Lessee (or
any Sublessee) from placing its customary colors and insignia on the
Airframe or any Engine.
SECTION 8. REPLACEMENT AND POOLING OF PARTS;
ALTERATIONS, MODIFICATIONS AND ADDITIONS.
(a) Replacement of Parts. Lessee, at its own cost and expense,
will promptly replace or cause to be replaced all Parts which may from time
to time be incorporated or installed in or attached to the Airframe or any
Engine and which may from time to time become worn out, lost, stolen,
destroyed, seized, confiscated, damaged beyond repair or permanently
rendered unfit for use for any reason whatsoever, except as otherwise
provided in paragraph (c) of this Section 8 or if the Airframe or an Engine
to which a Part relates has suffered an Event of Loss. In addition, Lessee
(or any Sublessee) may, at its own cost and expense, remove in the ordinary
course of maintenance, service, repair, overhaul or testing, any Parts,
whether or not worn out, lost, stolen, destroyed, seized, confiscated,
damaged beyond repair or permanently rendered unfit for use, provided that
Lessee (or any Sublessee), except as otherwise provided in paragraph (c) of
this Section 8, will, at its own cost and expense, replace such Parts as
promptly as practicable. All replacement Parts shall be free and clear of
all Liens (except for Permitted Liens and pooling arrangements to the
extent permitted by paragraph (b) of this Section 8 and except in the case
of replacement property temporarily installed on an emergency basis) and
shall be in as good operating condition as, and shall have a value and
utility at least equal to, the Parts replaced assuming such replaced Parts
were in the condition and repair required to be maintained by the terms
hereof. Except as otherwise provided in paragraph (c) of this Section 8,
all Parts at any time removed from the Airframe or any Engine shall remain
the property of Lessor, no matter where located, until such time as such
Parts shall be replaced by Parts which have been incorporated or installed
in or attached to the Airframe or such Engine and which meet the
requirements for replacement Parts specified above. Immediately upon any
replacement part becoming incorporated or installed in or attached to the
Airframe or any Engine as above provided, without further act (subject only
to Permitted Liens and any pooling arrangement to the extent permitted by
paragraph (b) of this Section 8 and except in the case of replacement
property temporarily installed on an emergency basis), (i) title to such
replacement Part shall thereupon vest in Lessor, (ii) such replacement Part
shall become subject to this Lease and be deemed part of the Airframe or
such Engine for all purposes hereof to the same extent as the Parts
originally incorporated or installed in or attached to the Airframe or such
Engine, and (iii) title to the replaced Part shall thereupon vest in Lessee
(or, if a Sublease is then in effect, any Sublessee), free and clear of all
rights of Lessor, and shall no longer be deemed a Part hereunder.
(b) Pooling of Parts. Any Part removed from the Airframe or any
Engine as provided in paragraph (a) of this Section 8 may be subjected by
Lessee (or any Sublessee) to a normal pooling arrangement customary in the
airline industry of which Lessee (or, if a Sublease is then in effect, any
Sublessee) is a party entered into in the ordinary course of Lessee's (or
any Sublessee's) business; provided that the Part replacing such removed
Part shall be incorporated or installed in or attached to such Airframe or
Engine in accordance with such paragraph (a) as promptly as practicable
after the removal of such removed Part. In addition, any replacement Part
when incorporated or installed in or attached to the Airframe or any Engine
in accordance with such paragraph (a) may be owned by any third party
subject to such a normal pooling arrangement, provided that Lessee (or any
Sublessee), at its expense, as promptly thereafter as practicable, either
(i) causes title to such replacement Part to vest in Lessor in accordance
with such paragraph (a) by Lessee (or any Sublessee) acquiring title
thereto for the benefit of, and transferring such title to, Lessor free and
clear of all Liens except Permitted Liens (other than pooling arrangements)
or (ii) replaces such replacement Part by incorporating or installing in or
attaching to the Airframe or Engine a further replacement Part owned by
Lessee (or any Sublessee) free and clear of all Liens except Permitted
Liens (other than pooling arrangements) and by causing title to such
further replacement Part to vest in Lessor in accordance with such
paragraph (a).
(c) Alterations, Modifications and Additions. Lessee, at its
own expense, will make (or cause to be made) such alterations and
modifications in and additions to the Airframe and Engines as may be
required from time to time to meet the applicable standards of the FAA or
any applicable regulatory agency or body of any other jurisdiction in which
the Aircraft may then be registered as permitted by Section 7(d) of the
Participation Agreement; provided, however, that Lessee (or, if a Sublease
is then in effect, any Sublessee) may, in good faith, contest the validity
or application of any such law, rule, regulation or order in any reasonable
manner which does not adversely affect Lessor or, so long as any Equipment
Notes are outstanding, the Indenture Trustee. In addition, Lessee (or any
Sublessee), at its own expense, may from time to time add further parts or
accessories and make such alterations and modifications in and additions to
the Airframe or any Engine as Lessee (or any Sublessee) may deem desirable
in the proper conduct of its business, including, without limitation,
removal of Parts which Lessee (or any Sublessee) has determined in its
reasonable judgment to be obsolete or no longer suitable or appropriate for
use on the Airframe or such Engine (such parts, "Obsolete Parts"); provided
that no such alteration, modification or addition shall materially diminish
the value, utility or remaining useful life of the Airframe or such Engine
below the value, utility or remaining useful life thereof immediately prior
to such alteration, modification or addition (it being agreed that the
modification that makes an Engine a CFM 56-5B-5/P engine shall be deemed
not to diminish the value, utility and remaining useful life of an Engine),
assuming the Airframe or such Engine was then in the condition required to
be maintained by the terms of this Lease, except that the value (but not
the utility or remaining useful life) of the Airframe or any Engine may be
reduced by the value of Obsolete Parts which shall have been removed so
long as the aggregate value of all Obsolete Parts which shall have been
removed and not replaced shall not exceed $350,000 in aggregate value at
the time of removal. Title to all Parts incorporated or installed in or
attached or added to the Airframe or an Engine as the result of such
alteration, modification or addition (except those parts which (x) Lessee
has leased from others and (y) may be removed by Lessee pursuant to the
next sentence (the "Additional Parts")) shall, without further act, vest in
Lessor. Notwithstanding the foregoing sentence, Lessee (or any Sublessee)
may remove or suffer to be removed any Additional Part, provided that such
Additional Part (i) is in addition to, and not in replacement of or
substitution for, any Part originally incorporated or installed in or
attached to the Airframe or any Engine at the time of delivery thereof
hereunder or any Part in replacement of, or substitution for, any such
Part, (ii) is not required to be incorporated or installed in or attached
or added to the Airframe or any Engine pursuant to the terms of Section 7
hereof or the first sentence of this paragraph (c) and (iii) can be removed
from the Airframe or such Engine without diminishing or impairing the
value, utility or remaining useful life which the Airframe or such Engine
would have had at the time of removal had such alteration, modification or
addition not occurred. Upon the removal by Lessee (or Sublessee) of any
Part as provided above, title thereto shall, without further act, vest in
Lessee (or any Sublessee, as the case may be) and such Part shall no longer
be deemed part of the Airframe or Engine from which it was removed. Any
Part not removed by Lessee (or any Sublessee) as above provided prior to
the return of the Airframe or Engine to Lessor hereunder shall remain the
property of Lessor.
(d) Certain Matters Regarding Passenger Convenience Equipment.
Lessee may install on the Airframe, subject to the requirements of Section
8(c) above, Passenger Convenience Equipment that is (i) owned by another
Person and leased to Lessee, (ii) sold to Lessee by another Person subject
to a conditional sale contract or other retained security interest, (iii)
leased to Lessee pursuant to a lease which is subject to a security
interest in favor of another Person or (iv) installed on the Aircraft
subject to a license granted to Lessee by another Person, and in any such
case the Lessor and the Indenture Trustee will not acquire or claim, as
against any such other Person, any right, title or interest in any such
Passenger Convenience Equipment solely as a result of its installation on
the Airframe. Lessee agrees that if any such Person repossesses such
Passenger Convenience Equipment, Lessee will (or will cause such Person to)
restore the Aircraft to the condition it would have been in had the
installation of such Passenger Convenience Equipment not occurred.
SECTION 9. VOLUNTARY TERMINATION.
(a) Termination Event.
(i) Lessee shall have the right to elect to terminate this
Lease (x) on any Rent Payment Date occurring on or after the close of
the calendar year in which the seventh (7th) anniversary of the
Delivery Date occurs if Lessee shall have made the good faith
determination, which shall be evidenced by a certificate of a
responsible officer of Lessee, that the Aircraft is obsolete or
surplus to its needs or (y) on the tenth, thirteenth and sixteenth
anniversaries of the Delivery Date.
(ii) Lessee shall give to Lessor at least one hundred twenty
(120) days revocable advance written notice of Lessee's intention to
so terminate this Lease (any such notice, a "Termination Notice")
specifying (A) the Rent Payment Date on which Lessee intends to
terminate this Lease in accordance with this Section 9 (such
specified date, a "Termination Date"), (B) either (I) that Lessee has
determined that the Aircraft is obsolete or surplus to its needs or
(II) that it is exercising its termination option pursuant to Section
9(a)(i)(y) and (C) in the case of a Termination under Section
9(a)(i)(y) whether Lessee elects to purchase the Aircraft pursuant to
Section 9(d). Any Termination Notice shall become irrevocable fifteen
(15) days prior to the Termination Date.
(b) Optional Sale of the Aircraft; Lessor Retention Option;
Revocation of Termination Notice. In the event that Lessee shall have
exercised its right to terminate this Lease under Section 9(a)(i)(y) but
shall not have elected to purchase the Aircraft pursuant to Section 9(d),
or Lessee shall have elected to terminate this Lease pursuant to Section
9(a)(i)(x), then during the period from the giving of the Termination
Notice until the proposed Termination Date (unless Lessee shall have
revoked the Termination Notice specifying such proposed Termination Date or
Lessor shall have irrevocably elected to retain the Aircraft pursuant to
this Section 9(b)), Lessee, as agent for Lessor and at no expense to
Lessor, shall use commercially reasonable efforts to obtain bids for the
purchase of the Aircraft and, in the event it receives any bid, Lessee
shall, within five (5) Business Days after receipt thereof and at least ten
(10) Business Days prior to the proposed Termination Date, certify to
Lessor in writing the amount and terms of such bid, and the name and
address of the party or parties (who shall not be Lessee or any Affiliate
of Lessee or any Person with whom Lessee or any such Affiliate has an
arrangement or understanding regarding the future use of the Aircraft by
Lessee or any such Affiliate but who may be the Owner Participant, any
Affiliate thereof or any Person contacted by the Owner Participant)
submitting such bid. Subject to the next succeeding sentence, on or before
the Termination Date, subject to the release of all mortgage and security
interests with respect to the Aircraft under the Trust Indenture: (1)
Lessee shall deliver the Aircraft, or cause the Aircraft to be delivered,
to the bidder(s), if any, which shall have submitted the highest bid
therefor at least ten (10) Business Days prior to such Termination Date, in
the same manner and in the same condition and otherwise in accordance with
all the terms of this Lease as if delivery were made to Lessor pursuant to
Section 5, and shall duly transfer to Lessor title to any engines not owned
by Lessor all in accordance with the terms of Section 5, (2) Lessor shall
comply with the terms of the Trust Indenture and shall, without recourse or
warranty (except as to the absence of Lessor Liens), subject to prior or
concurrent payment by Lessee of all amounts due under clause (3) of this
sentence, sell all of Lessor's right, title and interest in and to the
Aircraft for cash in Dollars to such bidder(s), the total sales price
realized at such sale to be retained by Lessor, and (3) Lessee shall
simultaneously pay or cause to be paid to Lessor in funds of the type
specified in Section 3(e) hereof, an amount equal to the sum of (A) the
excess, if any, of (i) the Termination Value for the Aircraft, computed as
of the Termination Date, over (ii) the sales price of the Aircraft sold by
Lessor after deducting the reasonable expenses incurred by Lessor in
connection with such sale, (B) all unpaid Basic Rent with respect to the
Aircraft due prior to (but not on) such Termination Date and all
Supplemental Rent due by Lessee under this Lease (including, without
limitation, Supplemental Rent in respect of the Make-Whole Amount, if any,
payable in connection with a prepayment of the Equipment Notes, and upon
such payment Lessor simultaneously will transfer to Lessee, without
recourse or warranty (except as to the absence of Lessor Liens), all of
Lessor's right, title and interest in and to any Engines constituting part
of the Aircraft which were not sold with the Aircraft. Notwithstanding the
preceding sentence, Lessor may, if Lessee has not revoked the Termination
Notice, elect to retain title to the Aircraft. If Lessor so elects, Lessor
shall give to Lessee irrevocable written notice of such election within
thirty (30) days of its receipt of a Termination Notice accompanied by an
irrevocable undertaking by the Owner Participant to make available to the
Lessor for payment to the Indenture Trustee on the Termination Date the
amount required to pay in full the unpaid principal amount of the Equipment
Notes outstanding on the Termination Date plus interest accrued thereon
through the Termination Date together with the Make-Whole Amount, if any,
due on the Equipment Notes, if the same is not otherwise paid. Upon receipt
of notice of such an election by Lessor and the accompanying undertaking by
the Owner Participant, Lessee shall cease its efforts to obtain bids as
provided above and shall reject all bids theretofore or thereafter
received. On the Termination Date, Lessor shall (subject to the payment by
Lessee of all Rent due on or prior to such date, other than any Basic Rent
due on such date) pay in full the unpaid principal amount of the Equipment
Notes outstanding on the Termination Date plus interest accrued thereon
through the Termination Date together with all Make- Whole Amount, if any,
due on the Equipment Notes and, so long as the Equipment Notes are paid as
aforesaid, Lessee shall deliver the Airframe and Engines or engines to
Lessor in accordance with Section 5 and shall pay all Basic Rent due prior
to the Termination Date and all Supplemental Rent (other than Make-Whole
Amount or Termination Value) due on or prior to the Termination Date. If no
sale shall have occurred on the Termination Date and Lessor has not made
the payment contemplated by the preceding sentence and thereby caused this
Lease to terminate, or if Lessee revokes its Termination Notice, this Lease
shall continue in full force and effect as to the Aircraft, Lessee shall
pay the reasonable costs and expenses incurred by the Owner Participant and
Lessor (unless such failure to terminate the Lease is a consequence of the
failure of Lessor or the Owner Participant without due cause to make, or
cause to be made, the payment referred to in the immediately preceding
sentence, in which case Lessor and the Owner Participant shall be
responsible for damages), if any, in connection with preparation for such
sale and Lessee may give one or more additional Termination Notices in
accordance with Section 9(a), subject to the last sentence of this Section
9(b). In the event of any such sale or such retention of the Aircraft by
Lessor and upon compliance by Lessee with the provisions of this paragraph,
the obligation of Lessee to pay Basic Rent or any other amounts hereunder
shall cease to accrue and this Lease shall terminate. Lessor may, but shall
be under no duty to, solicit bids, inquire into the efforts of Lessee to
obtain bids or otherwise take any action in connection with any such sale
other than to transfer (in accordance with the foregoing provisions) to the
purchaser named in the highest bid certified by Lessee to Lessor all of
Lessor's right, title and interest in the Aircraft, against receipt of the
payments provided herein. Lessee may revoke a Termination Notice given
pursuant to Section 9(a) no more than [two (2)] times during the Term.
(c) Termination as to Engines; Replacement. Lessee shall have
the right at its option at any time during the Term, on at least thirty
(30) days prior written notice, to terminate this Lease with respect to any
Engine. In such event, and prior to the date of such termination, Lessee
shall replace such Engine hereunder by complying with the terms of Section
10(b) to the same extent as if an Event of Loss had occurred with respect
to such Engine, and Lessor shall transfer such right, title and interest as
it may have to the replaced Engine as provided in Section 5(b). No
termination of this Lease with respect to any Engine as contemplated by
this Section 9(c) shall result in any reduction of Basic Rent.
(d) Special Purchase Options. If Lessee exercises its right to
terminate this Lease under Section 9(a)(1)(y), gives its notice pursuant to
Section 9(a)(ii) to purchase the Aircraft pursuant to this Section 9(d) and
such notice becomes irrevocable, then on the Termination Date specified in
Section 9(a), Lessee shall purchase the Aircraft at the greater of (i) the
Termination Value on the Termination Date, or (ii) its fair market sales
value on the Termination Date (determined in accordance with Section 19(c)
hereof), provided that Lessee shall have also paid the amounts specified in
(A) and (B) of the following sentence. In such event, Lessor shall, without
recourse or warranty (except as to the absence of Lessor Liens), sell the
Aircraft to Lessee in exchange for the payment in immediately available
funds in an amount equal to the greater of (x) the Termination Value for
the Aircraft, computed as of the Termination Value Date, or (y) the fair
market sales value of the Aircraft on the Termination Date, provided that
on such date the Lessee shall have also paid to the Lessor the sum of (A)
all unpaid Basic Rent with respect to the Aircraft due prior to (but not
on) such Termination Date and all unpaid Supplemental Rent with respect to
the Aircraft due on or prior to such Termination Date plus (B) all
reasonable expenses incurred by Lessor and the Owner Participant in
connection with such sale. Upon payment in full of the amounts required to
be paid and the performance of all acts required to be performed by Lessee
pursuant to the preceding sentence, (i) the obligation of Lessee to pay
Basic Rent hereunder with respect to the Aircraft due on or after the
Termination Date shall terminate with respect to the Aircraft, (ii) this
Lease shall terminate on the Termination Date, (iii) Lessor will transfer
to or at the direction of Lessee, without recourse or warranty (except as
to the absence of Lessor Liens), all of Lessor's right, title and interest
in the Airframe and Engines and furnish to or at the direction of the
Lessee a bill of sales in form and substance reasonably satisfactory to
Lessee, evidencing such transfer. Notwithstanding the foregoing, Lessee
may, in accordance with Section 7(u) of the Participation Agreement, assume
the principal amount of the Equipment Notes then outstanding on any
Termination Date specified in Section 9(a), in which event the Lessee will
receive a credit against the purchase price otherwise payable pursuant to
this Section 9(d) in an amount equal to the principal amount of Equipment
Notes so assumed.
SECTION 10.LOSS, DESTRUCTION, REQUISITION, ETC.
(a) Event of Loss with Respect to the Aircraft. Upon the
occurrence of an Event of Loss with respect to the Airframe or the Airframe
and the Engines and/or engines then installed thereon, Lessee shall
forthwith (and in any event, within fifteen (15) days after such
occurrence) give Lessor written notice of such Event of Loss, and, within
sixty (60) days after such Event of Loss, Lessee shall give Lessor written
notice of its election to perform one of the following options (it being
agreed that if Lessee shall not have given such notice of election within
such period, Lessee shall be deemed to have elected the option set forth in
clause (i) below). Lessee may elect either to:
(i) make the payments specified in this clause (i),
in which event not later than the earlier of (x) the Business Day
next succeeding the 120th day following the occurrence of such Event
of Loss or (y) an earlier Business Day irrevocably specified fifteen
(15) days in advance by notice from Lessee to Lessor and the
Indenture Trustee (the "Loss Payment Date"), Lessee shall pay or
cause to be paid to Lessor in funds of the type specified in Section
3(e) hereof, an amount equal to the Termination Value of the Aircraft
corresponding to the Termination Value Date occurring on or
immediately following the Loss Payment Date (the "Determination
Date"); provided that in any instance in which the applicable Loss
Payment Date shall occur after the final day of the Term, the
Determination Date shall be the last Termination Value Date in the
Term, and the Termination Value shall be reduced by any amount of
Basic Rent due on the Determination Date that has actually been paid;
(ii)substitute an aircraft or an airframe or an
airframe and one or more engines, as the case may be; provided that,
if Lessee does not perform its obligation to effect such substitution
in accordance with this Section 10(a), during the period of time
provided herein, then Lessee shall pay or cause to be paid to Lessor
on the Business Day next succeeding the 120th day following the
occurrence of such Event of Loss the amount specified in clause (i)
above.
At such time as Lessor shall have received the amounts
specified in clause (i) above, together with all other amounts that then
may be due hereunder (excluding Basic Rent due on the Determination Date
but including, without limitation, all Basic Rent due before the date of
such payment and all Supplemental Rent), under the Participation Agreement
and under the Tax Indemnity Agreement, (1) the obligation of Lessee to pay
the installments of Basic Rent shall cease to accrue, (2) this Lease shall
terminate, (3) Lessor will comply with the terms of the Trust Indenture and
transfer to or at the direction of Lessee, without recourse or warranty
(except as to the absence of Lessor Liens), all of Lessor's right, title
and interest in and to the Airframe and any Engines subject to such Event
of Loss, as well as any Engines not subject to such Event of Loss, and
furnish to or at the direction of Lessee a bill of sale in form and
substance reasonably satisfactory to Lessee (or any Sublessee), evidencing
such transfer, and (4) Lessee will be subrogated to all claims of Lessor,
if any, against third parties, for damage to or loss of the Airframe and
any Engines which were subject to such Event of Loss to the extent of the
then insured value of the Aircraft.
In the event Lessee shall elect to substitute an aircraft (or
an airframe or an airframe and one or more engines, as the case may be)
Lessee shall, at its sole expense, not later than the Business Day next
succeeding the 120th day following the occurrence of such Event of Loss,
(A) convey or cause to be conveyed to Lessor and to be leased by Lessee
hereunder, an aircraft (or an airframe or an airframe and one or more
engines which, together with the Engines constituting a part of the
Aircraft but not installed thereon at the time of such Event of Loss
constitute the Aircraft) free and clear of all Liens (other than Permitted
Liens) and having a value, utility and remaining useful life at least equal
to the Aircraft subject to such Event of Loss assuming that the Aircraft
had been maintained in accordance with this Lease and (B) prior to or at
the time of any such substitution, Lessee (or any Sublessee), at its own
expense, will (1) furnish Lessor with a full warranty bill of sale and a
Federal Aviation Administration bill of sale, in form and substance
reasonably satisfactory to Lessor, evidencing such transfer of title, (2)
cause a Lease Supplement and a Trust Supplement to be duly executed by
Lessee and filed for recording pursuant to the Transportation Code, or the
applicable laws, rules and regulations of any other jurisdiction in which
the Airframe may then be registered as permitted by Section 7(d) of the
Participation Agreement, (3) cause a financing statement or statements with
respect to such substituted property to be filed in such place or places as
are deemed necessary or desirable by Lessor to perfect its and the
Indenture Trustee's interest therein and herein, (4) furnish Lessor with
such evidence of compliance with the insurance provisions of Section 11
with respect to such substituted property as Lessor may reasonably request,
(5) furnish Lessor with copies of the documentation required to be provided
by Lessee pursuant to Section 5.06 of the Trust Indenture, and Lessor
simultaneously will comply with the terms of the Trust Indenture and
transfer to or at the direction of Lessee, without recourse or warranty
(except as to the absence of Lessor Liens), all of Lessor's right, title
and interest, if any, in and to the Aircraft or the Airframe and one or
more Engines, as the case may be, with respect to which such Event of Loss
occurred and furnish to or at the direction of Lessee a bill of sale in
form and substance reasonably satisfactory to Lessee (or any Sublessee),
evidencing such transfer, (6) furnish Lessor with an opinion of counsel
(which shall be Skadden, Arps, Slate, Meagher & Flom LLP or Skadden, Arps,
Slate, Meagher & Flom (Illinois) and, if not, other counsel chosen by
Lessee and reasonably acceptable to Lessor) reasonably satisfactory to
Lessor to the effect that Lessor and the Indenture Trustee will be entitled
to the benefits of Section 1110 of the U.S. Bankruptcy Code with respect to
the substitute aircraft, provided that such opinion need not be delivered
to the extent that immediately prior to such substitution the benefits of
Section 1110 of the U.S. Bankruptcy Code were not, solely by reason of a
change in law or governmental interpretation thereof after the date hereof,
available to Lessor and, so long as any Equipment Notes are outstanding,
the Indenture Trustee (it being agreed that such opinion may contain
customary qualifications and assumptions) and (7) Lessee will be subrogated
to all claims of Lessor, if any, against third parties for damage to or
loss of the Airframe and any Engine which were subject to such Event of
Loss to the extent of the then insured value of the Aircraft. For all
purposes hereof, the property so substituted shall after such transfer be
deemed part of the property leased hereunder and shall be deemed an
"Aircraft", "Airframe" and "Engine", as the case may be, as defined herein.
No Event of Loss with respect to the Airframe or the Airframe and the
Engines or engines then installed thereon for which substitution has been
elected pursuant to Section 10(a)(ii) hereof shall result in any reduction
in Basic Rent.
(b) Event of Loss with Respect to an Engine. Upon the
occurrence of an Event of Loss with respect to an Engine under
circumstances in which there has not occurred an Event of Loss with respect
to the Airframe, Lessee shall forthwith (and in any event, within fifteen
days after such occurrence) give Lessor written notice thereof and shall,
within one hundred twenty (120) days after the occurrence of such Event of
Loss, convey or cause to be conveyed to Lessor, as replacement for the
Engine with respect to which such Event of Loss occurred, title to an
Acceptable Alternate Engine. Prior to or at the time of any such
conveyance, Lessee, at its own expense, will (i) furnish Lessor with a
warranty (as to title) bill of sale, in form and substance reasonably
satisfactory to Lessor, with respect to such Acceptable Alternate Engine,
(ii) cause a Lease Supplement and Trust Supplement to be duly executed by
Lessee and to be filed for recording pursuant to the Transportation Code,
or the applicable laws, rules and regulations of any other jurisdiction in
which the Airframe may then be registered as permitted by Section 7(d) of
the Participation Agreement, (iii) furnish Lessor with such evidence of
compliance with the insurance provisions of Section 11 hereof with respect
to such replacement engine as Lessor may reasonably request and furnish
Lessor with copies of the documentation required to be provided by Lessee
pursuant to Section 5.06 of the Trust Indenture, and Lessor will comply
with the terms of the Trust Indenture and transfer to or at the direction
of Lessee without recourse or warranty (except as to absence of Lessor
Liens) all of Lessor's right, title and interest, if any, in and to (A) the
Engine with respect to which such Event of Loss occurred and furnish to or
at the direction of Lessee a bill of sale in form and substance reasonably
satisfactory to Lessee, evidencing such transfer and (B) all claims, if
any, against third parties, for damage to or loss of the Engine subject to
such Event of Loss, and such Engine shall thereupon cease to be the Engine
leased hereunder. For all purposes hereof, each such replacement engine
shall, after such conveyance, be deemed part of the property leased
hereunder, and shall be deemed an "Engine". No Event of Loss with respect
to an Engine under the circumstances contemplated by the terms of this
paragraph (b) shall result in any reduction in Basic Rent.
(c) Application of Payments from Governmental Authorities for
Requisition of Title, etc. Any payments (other than insurance proceeds the
application of which is provided for in Section 11) received at any time by
Lessor or by Lessee from any governmental authority or other Person with
respect to an Event of Loss will be applied as follows:
(i) if payments are received with respect to the
Airframe (or the Airframe and any Engine or engines then installed
thereon), (A) unless the same are replaced pursuant to the last
paragraph of Section 10(a), after reimbursement of Lessor (as
provided in Section 7.01 of the Trust Agreement) for reasonable costs
and expenses, so much of such payments remaining as shall not exceed
the Termination Value required to be paid by Lessee pursuant to
Section 10(a), shall be applied in reduction of Lessee's obligation
to pay Termination Value, if not already paid by Lessee, or, if
already paid by Lessee, shall be applied to reimburse Lessee for its
payment of Termination Value, and following the foregoing
application, the balance, if any, of such payments will be paid over
to, or retained by Lessee, provided that Lessor shall be entitled to
so much of the excess, if any, of such payment over the greater of
(x) the Termination Value and (y) the fair market value of the
Aircraft as Lessor shall demonstrate to Lessee's reasonable
satisfaction is attributable to compensation for loss of Lessor's
interest in the Aircraft as distinguished from the loss of use of the
Aircraft; or (B) if such property is replaced pursuant to the last
paragraph of Section 10(a), such payments shall be paid over to, or
retained by, Lessee; and
(ii)if such payments are received with respect to an
Engine under circumstances contemplated by Section 10(b) hereof, so
much of such payments remaining after reimbursement of Lessor (as
provided for in Section 7.01 of the Trust Agreement) for reasonable
costs and expenses shall be paid over to, or retained by, Lessee.
(d) Requisition for Use of the Aircraft by the United States
Government or the Government of Registry of the Aircraft. In the event of
the requisition for use of the Airframe and the Engines or engines
installed on the Airframe during the Term by the United States Government
or any other government of registry of the Aircraft or any instrumentality
or agency of any thereof, Lessee shall promptly notify Lessor of such
requisition, and all of Lessee's obligations under this Lease with respect
to the Aircraft shall continue to the same extent as if such requisition
had not occurred (except to the extent that any failure or delay in
repairing or maintaining the Aircraft shall have been caused by such
requisition), provided that if such Airframe and Engines or engines
installed thereon are not returned by such government prior to the end of
the Term, Lessee shall be obligated to return the Airframe and such Engines
or engines to Lessor pursuant to, and in all other respects in compliance
with the provisions of, Section 5 promptly on the date of such return by
such government. If, in the event of any such requisition, Lessee shall
fail to return the Aircraft on or before the thirtieth (30th) day beyond
the end of the Term, such failure shall constitute an Event of Loss which
shall be deemed to have occurred on the last day of the Term and in such
event Lessee shall make the payment contemplated by Section 10(a)(i) in
respect of such Event of Loss; provided, however, that Lessor may notify
Lessee in writing on or before the twentieth (20th) day prior to the last
day of the Term that, in the event Lessee shall fail by reason of such
requisition to return the Airframe and such Engines or engines on or before
the thirtieth day beyond the end of the Term, such failure shall not be
deemed an Event of Loss. Upon the giving of such notice and such failure to
return by the thirtieth (30th) day beyond the end of the Term, Lessee shall
be relieved of all of its obligations pursuant to the provisions of Section
5 (but not under any other Section), except that if any engine not owned by
Lessor shall then be installed on the Airframe, Lessee will, at no cost to
Lessor, furnish, or cause to be furnished, to Lessor a full warranty (as to
title) bill of sale with respect to each such engine, in form and substance
reasonably satisfactory to Lessor (together with an opinion of counsel
(which may be Lessee's General Counsel, Deputy General Counsel, Assistant
General Counsel or Associate General Counsel) to the effect that such full
warranty bill of sale has been duly authorized and delivered and is
enforceable in accordance with its terms and that such engines are free and
clear of Liens other than Lessor Liens, Loan Participant Liens and
Indenture Trustee Liens), against receipt from Lessor of a bill of sale
evidencing the transfer, without recourse or warranty (except as to the
absence of Lessor Liens), by Lessor to Lessee or its designee of all of
Lessor's right, title and interest in and to any Engine constituting part
of the Aircraft but not then installed on the Airframe. All payments
received by Lessor or Lessee from such government for the use of such
Airframe and Engines or engines during the Term shall be paid over to, or
retained by, Lessee (or, if directed by Lessee, any Sublessee); and all
payments received by Lessor or Lessee from such government for the use of
such Airframe and Engines or engines after the end of the Term shall be
paid over to, or retained by, Lessor unless Lessee shall have exercised its
purchase option hereunder, in which case such payments shall be made to
Lessee.
(e) Requisition for Use of an Engine by the United States
Government or the Government of Registry of the Aircraft. In the event of
the requisition for use of an Engine by the United States Government or any
other government of registry of the Aircraft or any agency or
instrumentality of any thereof (other than in the circumstances
contemplated by paragraph (d)), Lessee shall replace such Engine hereunder
by complying (or causing any Sublessee to comply) with the terms of Section
10(b) to the same extent as if an Event of Loss had occurred with respect
thereto, and, upon compliance with Section 10(b) hereof, any payments
received by Lessor or Lessee from such government with respect to such
requisition shall be paid over to, or retained by, Lessee.
(f) Application of Payments During Existence of Event of
Default. Any amount referred to in this Section 10 which is payable to or
retainable by Lessee (or any Sublessee) shall not be paid to or retained by
Lessee (or such Sublessee) if at the time of such payment or retention an
Event of Default has occurred and is continuing, but shall be held by or
paid over to Lessor as security for the obligations of Lessee (or such
Sublessee) under this Lease and, if an Event of Default has occurred and is
continuing hereunder, applied against Lessee's obligations hereunder as and
when due. At such time as there shall not be continuing any such Event of
Default, such amount shall be paid to Lessee (or such Sublessee) to the
extent not previously applied in accordance with the preceding sentence.
SECTION 11.INSURANCE.
(a) Lessee's Obligation to Insure. Lessee shall comply with, or
cause to be complied with, each of the provisions of Exhibit H, which
provisions are hereby incorporated by this reference as if set forth in
full herein.
(b) Additional Insurance by Lessor and Lessee. Lessee (and any
Sublessee) may at its own expense carry insurance with respect to its
interest in the Aircraft in amounts in excess of that required to be
maintained by this Section 11; the Owner Participant may carry for its own
account at its sole cost and expense insurance with respect to its interest
in the Aircraft, provided that such insurance does not prevent Lessee (or
any Sublessee) from carrying the insurance required or permitted by this
Section 11 or adversely affect such insurance or the cost thereof.
(c) Indemnification by Government in Lieu of Insurance.
Notwithstanding any provisions of this Section 11 requiring insurance,
Lessor agrees to accept, in lieu of insurance against any risk with respect
to the Aircraft, indemnification from, or insurance provided by, the United
States Government or any agency or instrumentality thereof, or, upon the
written consent of Lessor, other government of registry of the Aircraft or
agency or instrumentality thereof, against such risk in an amount which,
when added to the amount of insurance against such risk maintained by
Lessee (or any Sublessee) shall be at least equal to the amount of
insurance against such risk otherwise required by this Section 11 (taking
into account self-insurance permitted by Exhibit H hereto).
(d) Application of Payments During Existence of an Event of
Default. Any amount referred to in paragraph (b) of Exhibit H hereto which
is payable to or retainable by Lessee (or any Sublessee) shall not be paid
to or retained by Lessee (or any Sublessee) if at the time of such payment
or retention an Event of Default has occurred and is continuing, but shall
be held by or paid over to Lessor as security for the obligations of Lessee
under this Lease and, if Lessor declares this Lease to be in default
pursuant to Section 15 hereof, applied against Lessee's obligations
hereunder as and when due. At such time as there shall not be continuing
any such Event of Default, such amount shall be paid to Lessee to the
extent not previously applied in accordance with the preceding sentence.
SECTION 12.INSPECTION. At all reasonable times and upon at
least 15 days prior written notice to Lessee, the Owner Participant or the
Indenture Trustee, or their respective authorized representatives, may
inspect the Aircraft and inspect and make copies of the books and records
of Lessee and any Sublessee required to be maintained by the Federal
Aviation Administration or the regulatory agency or body of another
jurisdiction in which the Aircraft is then registered relating to the
maintenance of the Aircraft (at Lessor's, the Owner Participant's or the
Indenture Trustee's risk and expense, as the case may be) and shall keep
any information or copies obtained thereby confidential and shall not
disclose the same to any Person, except (A) to the Lessor, the Note Holders
and to prospective and permitted transferees of Lessor's, the Owner
Participant's, the Note Holders' or the Indenture Trustee's interest (and
such prospective and permitted transferee's counsel, independent insurance
advisors or other agents) who agree to hold such information confidential,
(B) to Lessor's, the Owner Participant's, the Note Holders' or the
Indenture Trustee's counsel, independent insurance advisors or other agents
who agree to hold such information confidential, or (C) as may be required
by any statute, court or administrative order or decree or governmental
ruling or regulation, provided, however, that any and all disclosures
permitted by clause (C) above shall be made only to the extent necessary to
meet the specific requirements or needs of the Persons for whom such
disclosures are hereby permitted. Any such inspection of the Aircraft shall
be subject to Lessee's safety and security rules applicable to the location
of the Aircraft, shall be a visual, walk-around inspection of the interior
and exterior of the Aircraft and shall not include opening any panels, bays
or the like without the express consent of Lessee (except in connection
with a heavy maintenance visit when a panel, bay or the like is scheduled
or required to be opened), which consent Lessee may in its sole discretion
withhold; provided that no exercise of such inspection right shall
interfere with the normal operation or maintenance of the Aircraft by, or
the business of, Lessee (or any Sublessee). Upon receipt by Lessee of a
written request from the Owner Participant specifying that the Owner
Participant desires to have an authorized representative observe the next
scheduled heavy maintenance visit to be performed on the Aircraft during
the Term, Lessee shall cooperate with the Owner Participant to enable the
Owner Participant's representative to observe such scheduled maintenance to
be performed on the Aircraft during the Term; provided that the Owner
Participant's authorized representative shall merely observe such scheduled
heavy maintenance visit, shall not interfere with or extend in any manner
the normal conduct or duration of the scheduled heavy maintenance visit,
and shall not be entitled to direct any of the work performed in connection
with such scheduled heavy maintenance visit. Neither the Owner Participant
nor the Indenture Trustee shall have any duty to make any such inspection
nor shall either of them incur any liability or obligation by reason of not
making such inspection. Except during the final six (6) months of the Term
or during the continuance of an Event of Default, all inspections by the
Owner Participant and its authorized representatives or the Indenture
Trustee and its authorized representatives provided for under this Section
12 shall, in regard to each of the Owner Participant and the Indenture
Trustee, be limited to one (1) inspection of any kind contemplated by this
Section 12 during any calendar year. During the last three months of the
Term (unless Lessee shall have elected to purchase the Aircraft or renew
this Lease in accordance with the terms of this Lease), with reasonable
notice, Lessee will cooperate and cause any Sublessee to cooperate, at
Lessor's sole cost, in all reasonable respects with the efforts of Lessor
to sell or lease the Aircraft, including, without limitation, permitting
prospective purchasers or lessees to inspect the Aircraft, any maintenance
records relating to the Aircraft then required to be retained by the FAA or
by the comparable government of registry of the Aircraft, all in accordance
with the provisions set forth above; provided that any such cooperation
shall not interfere with the normal operation or maintenance of the
Aircraft by, or the business of, Lessee or any Sublessee.
SECTION 13.ASSIGNMENT. Except as otherwise provided herein,
Lessee will not, without prior written consent of Lessor, assign in whole
or in part any of its rights or obligations hereunder. Lessor agrees that
it will not assign or convey its right, title and interest in and to this
Lease or the Aircraft except as provided herein, in the Trust Indenture,
the Trust Agreement, in the Participation Agreement or in any other
Operative Document. Subject to the foregoing, the terms and provisions of
this Lease shall be binding upon and inure to the benefit of Lessor and
Lessee and their respective successors and permitted assigns.
SECTION 14.EVENTS OF DEFAULT. Each of the following events
shall constitute an Event of Default (whether any 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) and each such Event of Default shall continue so long
as, but only as long as, it shall not have been remedied:
(a) Lessee shall not have made (i) a payment of Basic Rent
within five (5) Business Days after the same shall have become due, (ii) a
payment of Termination Value within ten (10) Business Days after receipt by
Lessee of written notice that the same is past due or (iii) an Advance when
required to be made pursuant to Section 3(g) within five (5) Business Days
after the same shall have been required to have been made; or
(b) Lessee shall have failed to make a payment of Supplemental
Rent (other than Termination Value) after the same shall have become due
and such failure shall continue for thirty (30) days after Lessee's receipt
of written demand therefor by the party entitled thereto (provided that any
failure to pay any amount owed by Lessee under the Tax Indemnity Agreement
or any failure of Lessee to pay to Lessor or the Owner Participant when due
any Excluded Payments shall not constitute an Event of Default unless
notice is given by the Owner Participant to Lessee and the Indenture
Trustee that such failure shall constitute an Event of Default); or
(c) Lessee shall have failed to perform or observe (or caused
to be performed and observed) in any material respect any covenant or
agreement (except the covenants set forth in the Tax Indemnity Agreement)
to be performed or observed by it under any Operative Document, and such
failure shall continue unremedied for a period of thirty (30) days after
receipt by Lessee of written notice thereof from Lessor or the Indenture
Trustee; provided, however, that if Lessee shall have undertaken to cure
any such failure and, notwithstanding the diligence of Lessee in attempting
to cure such failure, such failure is not cured within said thirty (30) day
period but is curable with future due diligence, there shall exist no Event
of Default under this Section 14 so long as Lessee is proceeding with due
diligence to cure such failure and such failure is remedied not later than
three hundred sixty (360) days after receipt by Lessee of such written
notice; or
(d) any representation or warranty made by Lessee herein or in
the Participation Agreement or any document or certificate furnished by
Lessee in connection herewith or therewith or pursuant hereto or thereto
(except the representations and warranties set forth in the Tax Indemnity
Agreement and such documents or certificates as are furnished to the Owner
Participant solely in connection with matters dealt with in the Tax
Indemnity Agreement and for no other purpose and except for representations
or warranties contained in the Pass Through Trust Agreement, the
Underwriting Agreement, the Class C Purchase Agreement or any document or
instrument furnished pursuant to either thereof) shall prove to have been
incorrect in any material respect at the time made, shall remain material
at the time in question and such incorrectness shall not have been cured
(to the extent of the adverse impact of such incorrectness on the interests
of the Owner Participant, Lessor or the Note Holders) within thirty (30)
days after the receipt by Lessee of a written notice from Lessor or the
Indenture Trustee advising Lessee of the existence of such incorrectness;
or
(e) the commencement of an involuntary case or other proceeding
in respect of Lessee in an involuntary case under the federal bankruptcy
laws, as now or hereafter constituted, or any other applicable federal or
state bankruptcy, insolvency or other similar law in the United States or
seeking the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of Lessee or for all or
substantially all of its property, or seeking the winding-up or liquidation
of its affairs and the continuation of any such case or other proceeding
undismissed and unstayed for a period of ninety (90) consecutive days or an
order, judgment or decree shall be entered in any proceeding by any court
of competent jurisdiction appointing, without the consent of Lessee, a
receiver, trustee or liquidator of Lessee, or of any substantial part of
its property, or sequestering any substantial part of the property of
Lessee and any such order, judgment or decree or appointment or
sequestration shall be final or shall remain in force undismissed, unstayed
or unvacated for a period of ninety (90) days after the date of entry
thereof; or
(f) the commencement by Lessee of a voluntary case under the
federal bankruptcy laws, as now constituted or hereafter amended, or any
other applicable federal or state bankruptcy, insolvency or other similar
law in the United States, or the consent by Lessee to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) of Lessee or for all or
substantially all of its property, or the making by Lessee of any
assignment for the benefit of creditors, or Lessee shall take any corporate
action to authorize any of the foregoing; or
(g) Lessee shall fail to carry and maintain on or with respect
to the Aircraft (or cause to be carried and maintained) insurance required
to be maintained in accordance with the provisions of Section 11 hereof;
provided, however, that, notwithstanding anything to the contrary contained
in Section 14(c) or (d) hereof, any failure of Lessee to perform or observe
any covenant, condition, agreement or any error in a representation or
warranty shall not constitute an Event of Default if such failure or error
is caused solely by reason of an event that constitutes an Event of Loss so
long as Lessee is continuing to comply with all of the terms of Section 10
hereof.
SECTION 15.REMEDIES. Upon the occurrence of any Event of
Default and at any time thereafter so long as the same shall be continuing,
Lessor may, at its option, declare by written notice to Lessee this Lease
to be in default; and at any time thereafter, so long as any such
outstanding Events of Default shall not have been remedied, Lessor may do
one or more of the following with respect to all or any part of the
Airframe and any or all of the Engines as Lessor in its sole discretion
shall elect, to the extent permitted by, and subject to compliance with any
mandatory requirements of, applicable law then in effect; provided,
however, that during any period the Aircraft is subject to the Civil
Reserve Air Fleet Program in accordance with the provisions of Section 7(b)
hereof and in possession of the United States government or an agency or
instrumentality of the United States, Lessor shall not, on account of any
Event of Default, be entitled to do any of the following in such manner as
to limit Lessee's control under this Lease (or any Sublessee's control
under any Sublease) of any Airframe or any Engines installed thereon,
unless at least sixty (60) days (or such lesser period as may then be
applicable under the Air Mobility Command program of the United States
Government) written notice of default hereunder shall have been given by
Lessor by registered or certified mail to Lessee (and any Sublessee) with a
copy addressed to the Contracting Office Representative for the Air
Mobility Command of the United States Air Force under any contract with
Lessee (or any Sublessee) relating to the Aircraft:
(a) upon the written demand of Lessor and at Lessee's expense,
cause Lessee to return promptly, and Lessee shall return promptly, the
Airframe or any Engine as Lessor may so demand to Lessor or its order in
the manner and condition required by, and otherwise in accordance with all
the provisions of, Section 5 as if such Airframe or Engine were being
returned at the end of the Term, or Lessor, at its option, may enter upon
the premises where all or any part of the Airframe or any Engine is located
and take immediate possession of and remove the same by summary proceedings
or otherwise (and/or, at Lessor's option, store the same at Lessee's
premises until disposal thereof by Lessor), all without liability accruing
to Lessor for or by reason of such entry or taking of possession or
removing whether for the restoration of damage to property caused by such
action or otherwise;
(b) sell the Airframe and/or any Engine at public or private
sale, as Lessor may determine, or otherwise dispose of, hold, use, operate,
lease to others or keep idle the Aircraft as Lessor, in its sole
discretion, may determine, all free and clear of any rights of Lessee,
except as hereinafter set forth in this Section 15;
(c) whether or not Lessor shall have exercised, or shall
thereafter at any time exercise, any of its rights under paragraph (a) or
paragraph (b) above with respect to the Airframe and/or any Engine, Lessor,
by written notice to Lessee specifying a payment date which shall be the
Rent Payment Date not earlier than ten (10) days from the date of such
notice, may demand that Lessee pay to Lessor, and Lessee shall pay Lessor,
on the payment date so specified, as liquidated damages for loss of a
bargain and not as a penalty (in lieu of the installments of Basic Rent for
the Aircraft due on Rent Payment Dates occurring on or after the Rent
Payment Date specified as the payment date in such notice), any unpaid
Basic Rent due on Rent Payment Dates prior to (but not on) the payment date
so specified (including, without limitation, any adjustments to Basic Rent
payable pursuant to Section 3(c)) plus whichever of the following amounts
Lessor, in its sole discretion, shall specify in such notice (together with
interest, if any, on such amount at the Past Due Rate from such specified
payment date until the date of actual payment of such amount): (i) an
amount equal to the excess, if any, of the Termination Value for the
Aircraft, computed as of the Rent Payment Date specified as the payment
date in such notice, over the aggregate fair market rental value (computed
as hereafter in this Section 15 provided) of such Aircraft for the
remainder of the Term, after discounting such aggregate fair market rental
value to present value as of the Rent Payment Date specified as the payment
date in such notice at an annual rate equal to the Past Due Rate; or (ii)
an amount equal to the excess, if any, of the Termination Value for such
Aircraft, computed as of the Rent Payment Date specified as the payment
date in such notice over the fair market sales value of such Aircraft
(computed as hereafter in this Section provided) as of the Rent Payment
Date specified as the payment date in such notice;
(d) in the event Lessor, pursuant to paragraph (b) above, shall
have sold the Airframe and/or any Engine, Lessor, in lieu of exercising its
rights under paragraph (c) above with respect to such Aircraft, may, if it
shall so elect, demand that Lessee pay Lessor, and Lessee shall pay to
Lessor, on the date of such sale, as liquidated damages for loss of a
bargain and not as a penalty (in lieu of the installments of Basic Rent for
the Aircraft due on or after such date), any unpaid Basic Rent with respect
to the Aircraft due prior to (but not on) such date (including, without
limitation, any adjustments to Basic Rent payable pursuant to Section 3(c))
plus the amount of any deficiency between the net proceeds of such sale
(after deduction of all reasonable costs of sale) and the Termination Value
of such Aircraft, computed as of the Termination Value Date (as set forth
on Exhibit C) on or immediately following the date of such sale together
with interest, if any, on the amount of such deficiency, at the Past Due
Rate, from the date of such sale to the date of actual payment of such
amount; and/or
(e) Lessor may rescind this Lease as to the Aircraft, and/or
may exercise any other right or remedy which may be available to it under
applicable law or proceed by appropriate court action to enforce the terms
hereof or to recover damages for breach hereof.
For the purposes of paragraph (c) above, the "fair market
rental value" or the "fair market sales value" of the Aircraft shall be the
rental value or sales value, as the case may be, which would be obtained in
an arm's-length transaction between an informed and willing lessee or
purchaser, as the case may be, under no compulsion to lease or purchase, as
the case may be, and an informed and willing lessor or seller in possession
under no compulsion to lease, sell, as the case may be, in each case based
upon the actual condition and location of the Aircraft, which value shall
be determined by mutual agreement or, in the absence of mutual written
agreement, pursuant to an appraisal prepared and delivered by a nationally
recognized firm of independent aircraft appraisers nominated by Lessor, and
Lessor shall immediately notify Lessee of such nomination. Unless Lessee
shall have objected in writing within ten (10) Business Days after its
receipt of Lessor's notice, Lessor's nomination shall be conclusive and
binding. If Lessee shall object, however, Lessor and Lessee shall endeavor,
within ten (10) Business Days after such objection is made, to select a
mutually acceptable appraiser; provided that, if Lessee shall not so
endeavor to make such selection, Lessor's nomination referred to in the
preceding sentence hereof shall be conclusive and binding. If Lessor and
Lessee fail to reach agreement (except for the reason referred to in the
proviso in the preceding sentence), or if any appraiser selected fails to
act for any reason, then the question shall be determined by an appraisal
(applying the definitions of "fair market rental value" and "fair market
sales value" as set forth above based upon the actual condition of the
Aircraft) mutually agreed to by two (2) recognized independent aircraft
appraisers, one of which appraisers shall be chosen by Lessor and one by
Lessee within five (5) Business Days after Lessor or Lessee shall have
received written notice from the other party of a demand that such an
appraisal be made, which notice shall specify the appraiser chosen by the
party giving the notice or, if such appraisers cannot agree on the amount
of such appraisal within twenty (20) Business Days after the end of such
five (5) Business Day period, each shall render its own appraisal and shall
by mutual consent choose another appraiser within five (5) Business Days
after the end of such twenty (20) day period. If, within such five (5) day
period, such two appraisers fail to appoint a third appraiser, then either
Lessor or Lessee, on behalf of both, may request such appointment by the
then President of the Association of the Bar of the City of New York (or
any successor organization thereto) or, in his absence, failure, refusal or
inability to act, then either Lessor or Lessee may apply to the American
Arbitration Association (or any successor organization thereto) in New
York, New York for the appointment of such third appraiser. The decision of
the third appraiser so appointed shall be given within twenty (20) Business
Days after the appointment of such third appraiser. As soon as the third
appraiser has delivered his appraisal, that appraisal shall be compared
with the appraisals given by the other two (2) appraisers. If the
determination of one appraiser is more disparate from the average of all
three determinations than each of the other two determinations, then the
determination of such appraiser shall be excluded, the remaining two
determinations shall be averaged and such average shall be final and
binding upon the parties hereto. If no determination is more disparate from
the average of all three determinations than each of the other
determinations, then such average shall be final and binding upon the
parties thereto. The cost of such appraisal or appointment shall be borne
by Lessee.
In addition, Lessee shall be liable, except as otherwise
provided above and without duplication of amounts payable hereunder, for
any and all unpaid Rent due hereunder before, after or during the exercise
of any of the foregoing remedies (other than Basic Rent due on or after the
payment referenced in paragraph (d) or paragraph (c) above) and for all
reasonable legal fees and other costs and expenses (including fees of the
appraisers hereinabove referred to) incurred by Lessor, the Indenture
Trustee, the Loan Participants and the Owner Participant in connection with
the return of the Airframe or any Engine in accordance with the terms of
Section 5 or in placing such Airframe or Engine in the condition and
airworthiness required by such Section.
At any sale of the Aircraft or any part thereof pursuant to
this Section 15, Lessor (or the Indenture Trustee, any Loan Participant or
the Owner Participant) or Lessee may bid for and purchase such property.
Lessor agrees to give Lessee at least fifteen (15) days prior written
notice of the date fixed for any public sale of the Airframe or any Engine
or of the date on or after which will occur the execution of any contract
providing for any private sale and any such public sale shall be conducted
in general so as to afford Lessee (and any Sublessee) a reasonable
opportunity to bid. Except as otherwise expressly provided above, no remedy
referred to in this Section 15 is intended to be exclusive, but each shall
be cumulative and in addition to any other remedy referred to above or
otherwise available to Lessor at law or in equity; and the exercise or
beginning of exercise by Lessor of any one or more of such remedies shall
not preclude the simultaneous or later exercise by Lessor of any or all of
such other remedies. No waiver by Lessor of any Event of Default shall in
any way be, or be construed to be, a waiver of any future or subsequent
Event of Default.
SECTION 16.LESSEE'S COOPERATION CONCERNING CERTAIN MATTERS;
DELIVERY OF FINANCIAL STATEMENTS. Forthwith upon the execution and delivery
of each Lease Supplement and Trust Supplement from time to time required by
the terms hereof and upon the execution and delivery of any amendment to
this Lease, to the Trust Indenture or to the Trust Agreement, Lessee will
cause such Lease Supplement, Trust Supplement (and, in the case of the
initial Lease Supplement and Trust Supplement, this Lease, the Trust
Agreement and the Trust Indenture as well) or amendment to be duly filed
and recorded, and maintained of record, in accordance with the applicable
laws of the government of registry of the Aircraft. In addition, Lessee
will promptly and duly execute and deliver to Lessor such further documents
and take such further action as Lessor or the Indenture Trustee may from
time to time reasonably request in order more effectively to carry out the
intent and purpose of this Lease and to establish and protect the rights
and remedies created or intended to be created in favor of Lessor and the
Indenture Trustee hereunder, including, without limitation, if requested by
Lessor or the Indenture Trustee, at the expense of Lessee, the execution
and delivery of supplements or amendments hereto or to the Trust Indenture,
each in recordable form, subjecting to this Lease and the Trust Indenture,
any airframe or engine substituted for the Airframe or any Engine pursuant
to the terms thereof and the recording or filing of counterparts thereof,
in accordance with the laws of such jurisdictions as Lessor or the
Indenture Trustee may from time to time deem advisable. Lessee agrees to
furnish to Lessor and the Indenture Trustee promptly after execution and
delivery of any supplement and amendment hereto and promptly after the
execution and delivery of any supplement and amendment to the Trust
Indenture (except for any such supplement or amendment which does not
require or receive the approval of Lessee pursuant to the Operative
Documents and is not required pursuant to the terms of the Operative
Documents), an opinion of counsel (which may be Lessee's General Counsel or
Deputy General Counsel or Associate General Counsel) reasonably
satisfactory to Lessor and the Indenture Trustee as to the due recording or
filing of such supplement or amendment. Lessee will deliver to Lessor, the
Owner Participant and the Indenture Trustee (a) within sixty (60) days
after the end of each of the first three quarterly periods of each fiscal
year of Lessee, the publicly filed Form 10-Q report of Lessee; and (b)
within one hundred twenty (120) days after the close of such fiscal year,
the publicly filed annual report and Form 10-K report of Lessee.
SECTION 17.NOTICES. All notices required under the terms and
provisions hereof shall be by telecopier or other telecommunication means
(with such telecopy or other telecommunication means to be confirmed in
writing), or if such notice is impracticable, by registered, first-class
airmail, with postage prepaid, or by personal delivery of written notice
and any such notice shall become effective when received, addressed:
(a) if to Lessee, for U.S. mail at 2345 Crystal Drive,
Arlington, Virginia 22227, and for overnight courier at 2345 Crystal Drive,
Arlington, Virginia 22227, Attention: Treasurer (Telecopy No. (703)
872-5936), or to such other address or telecopy number as Lessee shall from
time to time designate in writing to Lessor,
(b) if to Lessor, at 79 South Main Street, 3rd Floor, Salt Lake
City, Utah 84111, Attention: Corporate Trust Department (Telecopy No. (801)
246-5053), or to such other address or telecopy number as Lessor shall from
time to time designate in writing to Lessee, and
(c) if to a Loan Participant, the Indenture Trustee or the
Owner Participant, addressed to such Loan Participant, the Indenture
Trustee or the Owner Participant at such address or telecopy number as such
Loan Participant, the Indenture Trustee or the Owner Participant shall have
furnished by notice to Lessor and to Lessee, and, until an address is so
furnished, addressed to such Loan Participant, the Indenture Trustee or the
Owner Participant at its address or telecopy number set forth in Schedule I
to the Participation Agreement.
SECTION 18.NO SET-OFF, COUNTERCLAIM, ETC. All Rent shall be
paid by Lessee to Lessor in funds of the type specified in Section 3(e).
Except as expressly provided herein, Lessee's obligation to pay all Rent
payable hereunder shall be absolute and unconditional and shall not be
affected by any circumstance, including, without limitation, (i) any
set-off, counterclaim, recoupment, defense or other right which Lessee may
have against Lessor, in its individual capacity or as Owner Trustee under
the Trust Agreement, the Indenture Trustee (in its individual capacity or
as Indenture Trustee), any Loan Participant, the Owner Participant, or
anyone else for any reason whatsoever (whether in connection with the
transactions contemplated hereby or any other transactions), including,
without limitation, any breach by Lessor or the Owner Participant of their
respective warranties, agreements or covenants contained in any of the
Operative Documents, (ii) any defect in the title, registration,
airworthiness, condition, design, operation, or fitness for use of, or any
damage to or loss or destruction of, the Aircraft, or any interruption or
cessation in or prohibition of the use or possession thereof by Lessee (or
any Sublessee) for any reason whatsoever, including, without limitation,
any such interruption, cessation or prohibition resulting from the act of
any government authority, (iii) any insolvency, bankruptcy, reorganization
or similar case or proceedings by or against Lessee (or any Sublessee) or
any other person, or (iv) any other circumstance, happening, or event
whatsoever, whether or not unforeseen or similar to any of the foregoing;
provided, however, that notwithstanding the foregoing, Lessee shall be
entitled to offset from any payment due to the Owner Participant the cost
incurred by Lessee to discharge Lessor Liens relating to the Owner
Participant. If for any reason whatsoever this Lease shall be terminated in
whole or in part by operation of law or otherwise except as specifically
provided herein, Lessee nonetheless agrees without limitation of the other
rights or remedies of Lessor hereunder to pay to Lessor an amount equal to
each Rent payment at the time such payment would have become due and
payable in accordance with the terms hereof had this Lease not been
terminated in whole or in part. Lessee hereby waives, to the extent
permitted by applicable law, any and all rights which it may now have or
which at any time hereafter may be conferred upon it, by statute or
otherwise, to terminate, cancel, quit or surrender this Lease except in
accordance with the express terms hereof.
SECTION 19.RENEWAL OPTIONS; PURCHASE OPTIONS; VALUATION.
(a) Renewal Options.
(1) Fixed Renewal Term. Not more than 365 days and not
less than one hundred twenty (120) days, before the end of the Basic
Term or any Fixed Renewal Term (as hereinafter defined), Lessee may
deliver to Lessor a written notice irrevocably electing to renew this
Lease for a term having a duration and at a Basic Rent as determined
below (any such renewal term, a "Fixed Renewal Term"). The duration
of any Fixed Renewal Term shall be a period specified by Lessee
before the end of the Basic Term which is (i) not less than one year
(provided any such period shall be in six (6) month increments), (ii)
not more than the longest period of time which would cause the Term,
after giving effect to such Fixed Renewal Term, to be equal to 75% of
the total useful life of the aircraft as determined by the Delivery
Date appraisal. Each semi-annual installment of Basic Rent during the
Fixed Renewal Term shall be equal to the lesser of (A) the fair
market rental value of the Aircraft or (B) one-half of the average
annual Basic Rent during the Basic Term.
(2) Fair Market Renewal Term. Lessee shall have the right
to renew this Lease for additional periods of one (1) year or more
(provided any such period shall be on six (6) month increments)
commencing at the end of the Basic Term or the Fixed Renewal Term for
a Basic Rent equal to the fair market rental value of the Aircraft
for such period (any such renewal term, a "Fair Market Renewal
Term"). Each such option to renew shall be exercised by Lessee
providing irrevocable notice at least one hundred twenty (120) days
prior to the commencement of such Fair Market Renewal Term.
(3) Waiver. If no written notice is delivered by Lessee
to Lessor pursuant to Section 19(a)(1) or (a)(2) on or before the day
specified therefor, Lessee shall be deemed to have waived any right
to renew this Lease.
(4) Conditions Precedent, Payment of Basic Rent. At the
end of the Basic Term or any Renewal Term, if Lessee has elected to
renew this Lease as aforesaid, (i) this Lease shall continue in full
force and effect during the Renewal Term, and (ii) Basic Rent for
such Renewal Term shall be payable in semi-annual installments in
arrears, each such installment being due and payable on each Rent
Payment Date occurring during the Renewal Term, commencing with the
Rent Payment Date immediately following the commencement of the
Renewal Term, provided that Basic Rent for such Renewal Term shall be
payable at such other frequency of payment consistent with the length
of the Renewal Term as Lessor may reasonably designate in the event
that such period is not divisible into whole semi-annual periods.
(5) Termination Value. The amounts which are payable
during any Renewal Term in respect of Termination Value with respect
to the Aircraft shall be determined on the basis of the fair market
sales value of the Aircraft as of the commencement of such Renewal
Term, amortized on a straight-line basis over such Renewal Term to
the projected fair market sales value of the Aircraft as of the
expiration of such Renewal Term, as such fair market sales value in
each case is determined prior to the commencement of such Renewal
Term. In determining fair market sales value for purposes of
calculating Termination Value for any Renewal Term effect shall be
given to the encumbrance on the Aircraft of any Fixed Renewal Term
available or in force.
(b) Purchase Options. Lessee shall have the option, (i) upon at
least thirty (30) days irrevocable prior written notice to Lessor prior to
the EBO Date with respect to the purchase option set forth in clause (i)
and (ii) upon at least one hundred twenty (120) days irrevocable prior
written notice to Lessor prior to the relevant purchase date (each a
"Purchase Option Date") with respect to the purchase options set forth in
clauses (ii) and (iii), to terminate this Lease and to purchase the
Aircraft:
(1) on the EBO Date, for a purchase price equal to the
EBO Amount set forth on Exhibit D, it being understood that if such
amount is to be paid in installments, Lessee will, upon payment of
the first installment of the EBO Amount, on the EBO date, receive
title to the Aircraft free and clear of all liens (other than the
Lien of the Indenture if Lessee has elected to assume the Equipment
Notes in accordance with Section 7(u) of the Participation
Agreement);
(2) on the last Business Day of the Basic Term for a
purchase price equal to the fair market sales value of the Aircraft
on such date, provided, however, that in no event shall such purchase
price exceed 50% of Lessor's Cost;
(3) on the last Business Day of any Renewal Term for a
purchase price equal to the fair market sales value of the Aircraft
on such date.
Notwithstanding the foregoing, but subject to the last sentence
of this paragraph, the purchase price on any Purchase Option Date shall be
sufficient, together with all other amounts payable simultaneously by
Lessee, to pay in full the payments then required to be made on account of
the principal amount of and accrued and unpaid interest on the Equipment
Notes then outstanding. Upon payment to Lessor in immediately available
funds in Dollars of the full amount of the purchase price and payment of
any other amounts then due hereunder (including all Rent and all reasonable
costs or expenses of the Owner Participant in connection with such
purchase), Lessor will transfer to Lessee, without recourse or warranty
(except as to the absences of Lessor Liens), all of Lessor's right, title
and interest in and to the Aircraft. Notwithstanding the foregoing, Lessee
may, in accordance with Section 7(u) of the Participation Agreement, assume
the principal amount of the Equipment Notes then outstanding on any
applicable Purchase Option Date in which event Lessee shall receive a
credit against the purchase price otherwise payable pursuant to the
preceding two sentences in an amount equal to the principal amount so
assumed.
(c) Valuation. At any time not earlier than three hundred
sixty-five (365) days prior to the date on which Lessee may purchase the
Aircraft pursuant to Section 19(b)(2) or (b)(3) hereof or renew this Lease
pursuant to Section 19(a)(1) or (a)(2) hereof, Lessee may deliver to Lessor
a revocable notice of its intent to exercise its renewal option or purchase
option. For all purposes of this Section 19 and Section 20, including the
appraisal referred to in this Section 19(c), in determining "fair market
rental value" or "fair market sales value", the Aircraft shall be valued
(i) as if in the condition and otherwise in compliance with the terms of
Section 5 upon a return of the Aircraft to Lessor and as if it had been
maintained at all times as required in accordance with Section 7(a)(i)
during periods when no Sublease was in effect, (ii) on the basis of the
value which would obtain in an arm's-length transaction between an informed
and willing buyer-user or lessee (other than a lessee or an Affiliate of a
lessee currently in possession or a used equipment scrap dealer) under no
compulsion to buy or lease and an informed and willing seller or lessor
unaffiliated with such buyer-user or lessee and under no compulsion to sell
or lease and disregarding the purchase and renewal options of the lessee
provided in this Lease, and (iii) in the case of such valuation for
determining "fair market rental value", assuming such lessee would have
substantially the same obligations during the Fair Market Renewal Term as
provided hereunder including without limitation the obligations of Lessee
to carry and maintain the insurance required by Section 11 hereof and to
make certain payments with reference to Termination Value during the
applicable Fair Market Renewal Term. Upon receipt of such notice Lessor and
Lessee shall confer in good faith with a view to reaching agreement on the
"fair market rental value" or "fair market sales value" of the Aircraft. If
the parties have not so agreed within two hundred seventy (270) days prior
to the end of the Basic Term or the Renewal Term in question, then the
question shall be determined by an appraisal mutually agreed to by two
recognized independent aircraft appraisers, one of which appraisers shall
be chosen by Lessor and one by Lessee within five (5) Business Days after
Lessor or Lessee shall have received written notice from the other party of
a demand that such an appraisal be made, which notice shall specify the
appraiser chosen by the party giving the notice or, if such appraisers
cannot agree on the amount of such appraisal within twenty (20) Business
Days after the end of such five (5) Business Day period, each shall render
its own appraisal and shall by mutual consent choose another appraiser
within five (5) Business Days after the end of such twenty (20) Business
Day period. If, within such five (5) Business Day period, such two
appraisers fail to appoint a third appraiser, then either Lessor or Lessee,
on behalf of both, may request such appointment by the then President of
the Association of the Bar of the City of New York (or any successor
organization thereto) or, in his absence, failure, refusal or inability to
act, then either Lessor or Lessee may apply to the American Arbitration
Association (or any successor organization thereto) in New York, New York
for the appointment of such third appraiser. The decision of the third
appraiser so appointed shall be given within ten (10) Business Days after
the appointment of such third appraiser. As soon as the third appraiser has
delivered his appraisal, that appraisal shall be compared with the
appraisals given by the other two appraisers. If the determination of one
appraiser is more disparate from the average of all three determinations
than each of the other two determinations, then the determination of such
appraiser shall be excluded, the remaining two determinations shall be
averaged and such average shall be final and binding upon the parties
hereto. If no determination is more disparate from the average of all three
determinations than each of the other determinations, then such average
shall be final and binding upon the parties thereto. Lessee and Lessor
shall share equally all expenses relating to such appraisal procedure
provided if Lessee elects not to renew this Lease or purchase the Aircraft
following such appraisal, Lessee shall pay all expenses of such appraisal.
SECTION 20.BURDENSOME PURCHASE OPTION. If a Burdensome
Termination Event shall have occurred, then on any Rent Payment Date
occurring after the expiration of the Depreciation Period, Lessee shall
have the option, upon at least one hundred twenty (120) days revocable
prior notice to Lessor and, if any Equipment Notes are then outstanding,
the Indenture Trustee, to purchase the Aircraft on such date for a purchase
price equal to the higher of the Termination Value as of such date or the
fair market sales value of the aircraft (determined as set forth in clause
(c) above and excluding the value of any Significant Expenditure) (such
price, the "Burdensome Buyout Price"). In addition, if on such date there
shall be any Equipment Notes outstanding, Lessee shall have the option to
assume, pursuant to Section 7(u) of the Participation Agreement and Section
2.13 of the Trust Indenture, all of the obligations of Lessor under the
Trust Indenture. If such assumption is made, Lessee shall pay Lessor a
purchase price equal to (I) the Burdensome Buyout Price minus (II) an
amount equal to principal of, and accrued but unpaid interest on, any
Equipment Notes that are outstanding on such date. Upon such payment in
full and payment of any other amounts then due hereunder (excluding any
Basic Rent due on such date but including costs or expenses of the Owner
Participant in connection with such purchase, any installments of Basic
Rent due prior to such date and all unpaid Supplemental Rent due on or
prior to such date), Lessor will transfer to Lessee, without recourse or
warranty (except as to the absence of Lessor Liens), all of Lessor's right,
title and interest in and to the Aircraft and under the Trust Indenture
and, unless there shall be any Equipment Notes outstanding after such
payment, exercise such rights as it has to cause the Aircraft to be
released from the Lien of the Trust Indenture.
SECTION 21.SECURITY FOR LESSOR'S OBLIGATION TO HOLDERS OF
EQUIPMENT NOTES. In order to secure the indebtedness evidenced by the
Equipment Notes, Lessor has agreed in the Trust Indenture, among other
things, to assign to the Indenture Trustee this Lease, the Lease
Supplements and any amendments to this Lease and to mortgage its interest
in the Aircraft in favor of the Indenture Trustee, subject to the
reservations and conditions therein set forth. To the extent, if any, that
this Lease, the Lease Supplements and any amendments to this Lease
constitute chattel paper (as such term is defined in the Uniform Commercial
Code as in effect in any applicable jurisdiction), no security interest in
this Lease, the Lease Supplements and any amendments to this Lease may be
created through the transfer or possession of any counterpart other than
the original counterpart, which shall be identified as the counterpart
containing the receipt therefor executed by the Indenture Trustee on the
signature page thereof. Lessee hereby accepts and consents to the
assignment of all Lessor's right, title and interest in and to this Lease
pursuant to the terms of the Trust Indenture. Subject to Section 3(e)
hereof, Lessee agrees to pay directly to the Indenture Trustee (or, after
receipt by Lessee of notice from the Indenture Trustee of the discharge of
the Trust Indenture, to Lessor), all amounts of Rent due or to become due
hereunder and assigned to the Indenture Trustee and Lessee agrees that the
Indenture Trustee's right to such payments hereunder shall be absolute and
unconditional and shall not be affected by any circumstance, including,
without limitation, the circumstances set forth in clauses (i) through (iv)
of Section 18 hereof. Notwithstanding the foregoing assignment of this
Lease, the obligations of Lessor to Lessee to perform the terms and
conditions of this Lease shall remain in full force and effect.
SECTION 22.LESSOR'S RIGHT TO PERFORM FOR LESSEE. If Lessee
fails to make any payment of Rent required to be made by it hereunder or
fails to perform or comply with any of its agreements contained herein,
then (but in each case, except in the case of failure to pay Rent or in the
case of failure to maintain insurance as required hereunder, no earlier
than the fifteenth day after the occurrence of such failure, whether or not
it shall yet constitute an Event of Default hereunder) Lessor may itself
make such payment or perform or comply with such agreement but shall not be
obligated hereunder to do so, and the amount of such payment and the amount
of the reasonable expenses of Lessor incurred in connection with such
payment or the performance of or compliance with such agreement, as the
case may be, together with interest thereon at the Past Due Rate, shall be
deemed Supplemental Rent, payable by Lessee upon demand.
SECTION 23.INVESTMENT OF SECURITY FUNDS; LIABILITY OF
LESSOR LIMITED.
(a) Investment of Security Funds. Any moneys held by Lessor as
security hereunder for future payments to Lessee at a time when there is
not continuing an Event of Default shall, until paid to Lessee, be invested
by Lessor or, if the Trust Indenture shall not have been discharged, by the
Indenture Trustee, as the case may be, as Lessee may from time to time
direct in writing (and in absence of a written direction by Lessee, there
shall be no obligation to invest such moneys) in Cash Equivalents. There
shall be promptly remitted to Lessee or its order (but no more frequently
than monthly) any gain (including interest received) realized as a result
of any such investment (net of any fees, commissions and other expenses, if
any, incurred in connection with such investment) unless an Event of
Default shall have occurred and be continuing. Lessee shall be responsible
for any net loss realized as a result of any such investment and shall
reimburse Lessor (or the Indenture Trustee, as the case may be) therefor on
demand.
(b) Liability of Lessor Limited. It is expressly agreed and
understood that all representations, warranties and undertakings of Lessor
hereunder shall be binding upon Lessor only in its capacity as trustee
under the Trust Agreement, and the institution acting as Lessor shall not
be liable in its individual capacity for any breach thereof except for its
gross negligence or willful misconduct or for breach of its covenants,
representations and warranties contained herein, to the extent covenanted
or made in its individual capacity.
SECTION 24.JURISDICTION. Lessor and Lessee each hereby
irrevocably submits itself to the non-exclusive jurisdiction of the United
States District Court for the Southern District of New York and to the
non-exclusive jurisdiction of the Supreme Court of the State of New York,
New York County, for the purposes of any suit, action or other proceeding
arising out of this Lease, the subject matter hereof or any of the
transactions contemplated hereby brought by Lessor, Lessee, the Indenture
Trustee, the Loan Participants or the Owner Participant or their successors
or assigns.
SECTION 25.MISCELLANEOUS. Any provision of this Lease 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. No term or provision of this Lease may be changed, waived,
discharged or terminated orally, but only by an instrument in writing
signed by Lessor, Lessee and any assignee of Lessor's rights hereunder.
This Lease shall constitute an agreement of lease, and nothing contained
herein shall be construed as conveying to Lessee any right, title or
interest in the Aircraft except as a lessee only. Neither Lessee nor any
affiliate of Lessee will file any tax returns in a manner inconsistent with
the foregoing fact or with Lessor's ownership of the Aircraft. The section
and paragraph headings in this Lease and the table of contents are for
convenience of reference only and shall not modify, define, expand or limit
any of the terms or provisions hereof and all references herein to numbered
sections, unless otherwise indicated, are to sections of this Lease. THIS
LEASE HAS BEEN DELIVERED IN THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
This Lease 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 26.SUCCESSOR TRUSTEE. Lessee agrees that in the case of
the appointment of any successor Owner Trustee pursuant to the terms of the
Trust Agreement, such successor Owner Trustee shall, upon written notice by
such successor Owner Trustee, succeed to all the rights, powers and title
of Lessor hereunder and shall be deemed to be Lessor and the owner of the
Aircraft for all purposes hereof without the necessity of any consent or
approval by Lessee (subject to Section 9 of the Participation Agreement)
and without in any way altering the terms of this Lease or Lessee's
obligations hereunder. One such appointment and designation of a successor
Owner Trustee shall not exhaust the right to appoint and designate further
successor Owner Trustees pursuant to the Trust Agreement, but such right
may be exercised repeatedly as long as this Lease shall be in effect.
SECTION 27.LEASE FOR U.S. FEDERAL INCOME TAX LAW
PURPOSES; SECTION 1110 OF BANKRUPTCY CODE
(a) Lease for Federal Income Tax Law Purposes. It is the intent
of the parties to this Agreement that this Lease is a true lease for U.S.
Federal income tax purposes.
(b) Section 1110 of Bankruptcy Code. It is the intention of
each of Lessee and Lessor that Lessor (and the Indenture Trustee as secured
party as assignee of Lessor under the Trust Indenture) 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 this Lease.
IN WITNESS WHEREOF, Lessor and Lessee have each caused this
Lease to be duly executed as of the day and year first above written.
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not in its individual capacity except as
expressly provided herein, but solely as
Owner Trustee,
Lessor
By:____________________________________
Title:
US AIRWAYS, INC.,
Lessee
By:____________________________________
Title:
Receipt of this original counterpart of the foregoing Lease is
hereby acknowledged on the ___ day of _________, ____.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, Indenture Trustee
By:____________________________________
Title:
As set forth in Section 21 of the Lease (as defined below), Lessor has
assigned to the Indenture Trustee (as defined herein) certain of its right,
title and interest in and to the Lease and this Lease Supplement. To the
extent, if any, that this Lease Supplement constitutes chattel paper (as
such term is defined in the Uniform Commercial Code as in effect in any
applicable jurisdiction) no security interest in this Lease Supplement may
be created through the transfer or possession of any counterpart other than
the original executed counterpart, which shall be identified as the
counterpart containing the receipt therefor executed by the Indenture
Trustee on the signature page thereof.
EXHIBIT A
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
LEASE SUPPLEMENT NO.
(US Airways, Inc. Trust No. N___U_)
LEASE SUPPLEMENT NO. __, dated _________, _____, between FIRST
SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, not in
its individual capacity, but solely as Owner Trustee under the Trust
Agreement (US Airways, Inc. Trust No. N___U_), dated as of __________ __,
____ with the Owner Participant named therein (such Owner Trustee, in its
capacity as such Owner Trustee, being herein called "Lessor"), and US
AIRWAYS, INC., a Delaware corporation ("Lessee").
Lessor and Lessee have heretofore entered into that certain
Lease Agreement (US Airways, Inc. Trust No. N___U_), dated as of __________
__, ____, relating to one Airbus Model A___(6) aircraft (herein called the
"Lease," and the defined terms therein being hereinafter used with the same
meanings). The Lease provides for the execution and delivery from time to
time of Lease Supplements for the purpose of leasing the Airframe and
Engines under the Lease as and when delivered by Lessor to Lessee in
accordance with the terms thereof.
- -------------------
(6) Insert "A319", "A320" or "A330", as applicable.
[The Lease relates to the Airframe and Engines described below,
and a counterpart of the Lease is attached hereto, and made a part hereof,
and this Lease Supplement, together with such attachment, is being filed
for recordation on the date hereof with the Federal Aviation Administration
as one document.](7)
[The Lease relates to the Airframe and Engines described below,
and a counterpart of the Lease, attached and made a part of Lease
Supplement No. 1 dated _______________, ____ to the Lease, has been
recorded by the Federal Aviation Administration on ________________, ____,
as one document and assigned Conveyance No. __.](8)
NOW, THEREFORE, in consideration of the premises and other good
and sufficient consideration, Lessor and Lessee hereby agree as follows:
(a) Lessor hereby delivers and leases to Lessee under the Lease
and Lessee hereby accepts and leases from Lessor under the Lease the
following described Airbus Model A___(9) aircraft (the "Aircraft"), which
Aircraft as of the date hereof consists of the following components:
(i) Airframe: Airbus Model A___-
___10 airframe bearing FAA Registration No. ______;
manufacturer's serial no. _____; and
(ii) Engines: two (2) engines
identified as [ ](11) type aircraft engines
bearing, respectively, manufacturer's serial nos.______ and _____
(each of which engines has 750 or more rated takeoff horsepower or
the equivalent of such horsepower).
- -------------------
(7) For use on Lease Supplement No. 1.
(8) For use on Lease Supplement No. 2 and thereafter.
(9) Insert "A319", "A320" or "A330", as applicable.
(10) Insert full model number of Aircraft (e.g., "A319-112").
(11) Insert engine manufacturer and model number.
(b) The Delivery Date of the Aircraft is the date of this Lease
Supplement set forth in the opening paragraph hereof. Except as otherwise
provided in the Lease, the Term for the Aircraft shall commence on the
Delivery Date and end on ____________, 20__.
(c) Lessee hereby confirms its agreement to pay Lessor Basic
Rent for the Aircraft throughout the Term therefor in accordance with
Section 3 of the Lease.
(d) Lessee hereby confirms to Lessor that Lessee has accepted
the Aircraft for all purposes hereof and of the Lease as being airworthy,
in good working order and repair and without defect or inherent vice in
title, condition, design, operation or fitness for use; provided, however,
that nothing contained herein or in the Lease shall in any way diminish or
otherwise affect any right Lessee or Lessor may have with respect to the
Aircraft against Airbus Industrie G.I.E., or any subcontractor or supplier
of Airbus Industrie G.I.E., under the Purchase Agreement or otherwise.
(e) All of the terms and provisions of the Lease are hereby
incorporated by reference in this Lease Supplement to the same extent as if
fully set forth herein.
(f) This Lease Supplement 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. To the extent, if any, that this Lease
Supplement constitutes chattel paper (as such term is defined in the
Uniform Commercial Code as in effect in any jurisdiction), no security
interest in this Lease Supplement may be created through the transfer or
possession of any counterpart other than the original counterpart, which
shall be identified as the counterpart containing the receipt therefor
executed by the Indenture Trustee on the signature page hereof.
IN WITNESS WHEREOF, Lessor and Lessee have caused this Lease
Supplement to be duly executed on the day and year first above
written.
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not in its individual capacity except as
expressly provided herein, but solely as
Owner Trustee,
Lessor
By:_______________________________________
Name:
Title:
US AIRWAYS, INC.,
Lessee
By:_______________________________________
Name:
Title:
(1) Receipt of this original counterpart of the foregoing Lease
Supplement is hereby acknowledged on this ___day of__________, ____.
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION,
Indenture Trustee
By:_______________________________________
Name:
Title:
_________________________
(1) This language contained in the original counterpart only.
EXHIBIT B-1
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
PAST DUE RATE DEFINED
The portion of this Exhibit appearing below will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
"Past Due Rate" means (i) with respect to any portion of any
payment of Rent that may be required by the Trust Indenture to be paid by
the Indenture Trustee to the Loan Participants, or the holders of any
outstanding Equipment Notes, a rate per annum equal to 1% over the interest
rate then in effect for such Equipment Notes, and (ii) with respect to the
remaining portion of any payment of Rent (and the entire amount of any
payment of Rent after the satisfaction and discharge of the Trust
Indenture), a rate per annum equal to 1% over the Base Rate.
EXHIBIT B-2
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
BASIC RENT PAYMENTS
The portion of this Exhibit appearing below will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
Basic Rent Payment*
Rent Payment Date (Percentage of Lessor's Cost)
----------------- -----------------------------
* These Basic Rent Payments will be allocated to the Lease Periods as
set forth on Exhibit B-3.
EXHIBIT B-3
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
BASIC RENT ALLOCATIONS
The portion of this Exhibit appearing below will be intentionally
deleted from the FAA filing counterpart as the parties hereto deem it to
contain confidential information.
Timing of Payments to Allocated Rent
------------------------------------
Basic Rent
Allocation Amount
Lease Periods (Percentage of (Percentage
(Calendar year) Lessor's Cost) of Lessor's Cost) Rent Payment Date
--------------- -------------- ----------------- -----------------
EXHIBIT B-4
to
Lease Agreement
(US Airways, Inc. Trust No. N____U___
LESSOR'S COST
The portion of this Exhibit appearing below will be intentionally deleted
from the FAA filing counterpart as the parties hereto deem it to contain
confidential information.
Lessor's Cost: $__________
EXHIBIT C
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
TERMINATION VALUE SCHEDULE
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
Termination Basic Rent Amount
Amount as of Termination Total Termination Payment*
Termination (Percentage of Date (Percentage (Percentage of
Date Lessor's Cost) of Lessor's Cost) Lessor's Cost)
----------- -------------- ----------------- --------------------------
* The "Total Termination Payment" in this column is the amount payable
on termination which is the sum of, and represents, (i) a payment (or
reduction) of Basic Rent in an amount equal to the "Basic Rent
Amount" (which includes all amounts of Basic Rent allocated to any
period prior to the termination and not yet paid and reduced by all
amounts paid prior to the termination and allocated to periods after
the termination) and (ii) a payment of the "Termination Amount."
EXHIBIT D
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
EBO AMOUNT
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
EBO Date EBO Amount
-------- ----------
EXHIBIT E
to
Lease Agreement
(US Airways, Inc. N___U_)
RENT RECALCULATION AND
INDEMNIFICATION VERIFICATION
The portion of this Exhibit appearing below this will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
Any recalculation of Basic Rent, Termination Value percentages and
EBO Amount pursuant to the Lease shall be determined by the Owner
Participant, and shall maintain the Owner Participant's Net Economic Return
except as assumptions have been modified pursuant to Section 3 of the Lease
or pursuant to the Tax Indemnity Agreement or the Participation Agreement,
as the case may be; provided, however, that Lessee may request (A) Lessee's
independent public accountants to verify such calculations but without any
requirement that the Owner Participant disclose to such persons the
methodology and assumptions and (B) if Lessee believes that such
calculations by the Owner Participant are in error then a nationally
recognized firm of accountants selected by the Owner Participant and
reasonably acceptable to Lessee shall be permitted to verify such
calculations and the Owner Participant will make available to such firm
(subject to the execution by such firm of a confidentiality agreement
reasonably acceptable to the Owner Participant) the methodology and
assumptions and any changes made therein pursuant to Section 3 of the
Lease. In the event of a verification under clause (B) of the first
sentence of this paragraph the determination by such firm of accountants
shall be final. Lessee will pay the reasonable costs and expenses of the
verification under clause (B) of the first sentence of this paragraph
unless an error adverse to Lessee is established by such firm, and if as a
result of such verification process the Basic Rent is adjusted and such
adjustment causes the Net Present Value of Rents to decline by 10 (ten) or
more basis points or causes a material reduction in Termination Value, EBO
Amount or any indemnity payment (in which event the Owner Participant shall
pay the reasonable costs and expenses of such verification process). Such
recalculated Basic Rent, Termination Value percentages and EBO amounts
shall be set forth in a Lease Supplement or an amendment to the Lease.
"Net Economic Return" means the Owner Participant's after-tax yield
and aggregate after-tax cash flow utilizing the multiple investment sinking
fund method of analysis, computed on the basis of the same methodology and
assumptions as were utilized by the Owner Participant in determining Basic
Rent, Termination Value percentages and EBO Amount as of the Delivery Date.
EXHIBIT F
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
SCHEDULE OF DOMICILES OF PERMITTED SUBLESSEES
Australia Malta
Austria Mexico
Bahamas Netherlands
Belgium New Zealand
Bermuda Norway
Brazil People's Republic of China
Canada Philippines
Denmark Portugal
Finland Republic of China (Taiwan)*
France Singapore
Germany South Korea
Grenada Spain
Greece Sweden
Iceland Switzerland
India Thailand
Ireland Tobago
Italy Trinidad
Jamaica Turkey
Japan United Kingdom
Luxembourg United States of America
Malaysia Venezuela
*So long as on the date of the Sublease such country and the United
States have diplomatic relations at least as good as those in effect on the
Delivery Date.
EXHIBIT G
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
RETURN CONDITIONS
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
(a) Condition Upon Return. Unless purchased by Lessee pursuant
to Section 19 or 20 hereof, upon the termination of this Lease at the end
of the Basic Term or any Renewal Term or pursuant to Sections 9(b) or 15,
unless Lessor has requested that Lessee return the Aircraft to a storage
location pursuant to Section 5(b) (in which case the storage location
provided in said Section 5(b) shall be deemed to be the return location),
Lessee will return the Airframe to Lessor at one of Lessee's principal
maintenance bases located in one of the forty-eight contiguous states of
the United States chosen by Lessee, and Lessee will give Lessor at least
ten (10) days prior written notice of the place of such return. At the time
of such return, (i) Lessee will, at its own cost and expense, unless
otherwise requested by Lessor to retain the existing registration of the
Aircraft at least ninety (90) days prior to the date of return hereunder,
cause the Aircraft, if it is not then so registered, to be registered under
the laws of the United States with the Federal Aviation Administration in
the name of the Lessor or its designee, provided that Lessee shall be
relieved of its obligations under this sentence if such registration is
prohibited by reason of the failure of Lessor, Owner Participant or
Lessor's designee to be eligible on such date to own an aircraft registered
with the Federal Aviation Administration and (ii) the Airframe will be
fully equipped with the Engines (or Acceptable Alternate Engines) installed
thereon. Also, at the time of such return, Lessor shall have good title to
such Airframe and Engines or Acceptable Alternate Engines, and such
Airframe and Engine or Acceptable Alternate Engines (A) shall be certified
(or, if not then registered under the Transportation Code by reason of the
proviso of clause (i) in the preceding sentence or because Lessor has so
requested that the Aircraft not be so registered, shall hold a valid
certificate of airworthiness issued by the country of registry and be
eligible for certification by the Federal Aviation Administration) as an
airworthy aircraft by the Federal Aviation Administration, (B) shall be
free and clear of all Liens (other than Lessor Liens, Indenture Trustee's
Liens and Loan Participant Liens) and rights of third parties under
pooling, interchange, overhaul, repair or other similar agreements or
arrangements, (C) shall be in a regular passenger configuration, and in as
good a condition as when delivered by Seller to Lessee, ordinary wear and
tear excepted, and otherwise in the condition required to be maintained
under Lessee's FAA-approved maintenance plan (notwithstanding any Sublease
theretofore in effect), (D) in the event that Lessee (or any Sublessee then
in possession of the Aircraft) shall not then be using a continuous
maintenance program with respect to the Airframe immediately prior to such
return but instead shall have been using a block overhaul program with
respect to the Airframe, then (i) such block overhaul program shall have
been approved by the government of registry of the Aircraft and (ii) the
Airframe shall have remaining until the next scheduled block overhaul at
least 25% of the allowable hours between block overhauls permitted under
the block overhaul program then used by Lessee or such Sublessee, (E) in
the event that Lessee (or any Sublessee then in possession of the Aircraft)
during the period of operation of the Aircraft immediately prior to such
return shall not have been using an on-condition maintenance program with
respect to the Engines (or Acceptable Alternate Engines), Lessee agrees
that the average number of hours or cycles of operation (whichever shall be
applicable under the maintenance program then in use with respect to such
Engines (or Acceptable Alternate Engines) on such Engines (or Acceptable
Alternate Engines) remaining until the next scheduled engine heavy
maintenance shall be at least 25% of the hours or cycles (whichever shall
be applicable) between engine heavy maintenance allowed under the
maintenance program then in use with respect to such Engines (or Acceptable
Alternate Engines), (F) shall have all Lessee's and any Sublessee's
exterior marking removed or painted over with areas thereof refinished to
match adjacent areas, and (G) shall be in a state of cleanliness suitable
under Lessee's normal service standards for operation in Lessee's revenue
passenger service and in all such cases the Aircraft shall not have been
discriminated against whether by reason of its leased status or otherwise
in maintenance, use, operation or in any other manner whatsoever.
If clause (D) of the first paragraph of this subsection (a)
shall be applicable but the Airframe does not meet the conditions specified
in said clause (D), Lessee shall pay or cause to be paid to Lessor,
concurrently with the return thereof, a Dollar amount computed by
multiplying (i) 110% of the direct cost to Lessee (based upon the direct
cost to Lessee for similar aircraft in the fleet of Lessee) during the
preceding 12 months of performing an airframe block overhaul of the type
referred to in such clause (D) by (ii) a fraction of which (x) the
numerator shall be the excess of 25% of the hours of operation allowable
between such block overhauls over the actual number of hours of operation
remaining on the Airframe to the next such block overhaul and (y) the
denominator shall be the number of hours of operation allowable between
such block overhauls in accordance with such block overhaul program.
If clause (E) of the first paragraph of this subsection (a)
shall be applicable but the Engines (or Acceptable Alternate Engines) do
not meet the conditions specified in said clause (E), Lessee shall pay or
cause to be paid to Lessor, concurrently with the return thereof, a Dollar
amount computed by multiplying (i) 110% of the direct cost to Lessee (based
upon the direct cost to Lessee for similar aircraft in the fleet of Lessee)
during the preceding 12 months of performing for an engine of the same
model as the Engines (or Acceptable Alternate Engines) the scheduled engine
heavy maintenance under the maintenance program then used by Lessee for
engines of the same model as the Engines (or Acceptable Alternate Engines)
by (ii) a fraction which (x) the numerator shall be the excess of 25% of
the hours or cycles (whichever is applicable) of operation of one Engine
between engine heavy maintenance allowable under the maintenance program
then in use with respect to such Engines (or Acceptable Alternate Engines)
over the actual average number of hours or cycles of operation of such
Engines (or Acceptable Alternate Engines) remaining until the next such
scheduled engine heavy maintenance and (y) the denominator shall be the
number of hours or cycles allowable between such scheduled engine heavy
maintenance.
(b) Return of the Engines. In the event that an Acceptable
Alternate Engine shall be delivered with the returned Airframe as set forth
in subsection (a) of this Exhibit G, Lessee, concurrently with such
delivery, will, at no cost to Lessor, furnish, or cause to be furnished, to
Lessor a full warranty (as to title) bill of sale with respect to each such
Acceptable Alternate Engine, in form and substance satisfactory to Lessor
(together with an opinion of counsel (which may be Lessee's General
Counsel, Deputy General Counsel or Associate General Counsel) to the effect
that such full warranty bill of sale has been duly authorized and delivered
and is enforceable in accordance with its terms and that each such
Acceptable Alternate Engine is free and clear of all Liens other than
Lessor Liens, Loan Participant Liens and Indenture Trustee Liens), against
receipt from Lessor of a bill of sale or evidencing the transfer, without
recourse or warranty (except as to the absence of Lessor Liens), by Lessor
to Lessee or its designee of all of Lessor's right, title and interest in
and to any Engine not installed on the Airframe at the time of the return
of the Airframe.
(c) Fuel and Manuals. Upon the return of the Airframe upon any
termination of this Lease in accordance with subsection (a) of this Exhibit
G, (i) Lessor shall pay to Lessee, the amount of Lessee's cost for any fuel
or oil contained in the fuel or oil tanks of such Airframe and (ii) Lessee
shall deliver or cause to be delivered to Lessor all logs, manuals and data
and inspection, modification and overhaul records required to be maintained
under the provisions of the Lease.
EXHIBIT H
to
Lease Agreement
(US Airways, Inc. Trust No. N___U_)
INSURANCE
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential information.
(a) Public Liability and Property Damage Insurance. (1) Except
as provided in clause (2) of this subsection (a), and subject to
self-insurance to the extent permitted by subsection (d) of this Exhibit H,
Lessee will carry or cause to be carried with respect to the Aircraft at
its or any Sublessee's expense (i) comprehensive airline liability
(including, without limitation, passenger, contractual, bodily injury and
property damage liability) insurance (exclusive of manufacturer's product
liability insurance) and (ii) cargo liability insurance, (A) in an amount
not less than the greater of (x) the amounts of comprehensive airline
liability insurance from time to time applicable to aircraft owned or
leased, and operated by Lessee (or, if a Sublease is then in effect, by
Sublessee) of the same type as the Aircraft and (y) $300 million per
occurrence, (B) of the type and covering the same risks as from time to
time applicable to aircraft owned or leased and operated by Lessee of the
same type as the Aircraft, and (C) which is maintained in effect with
insurers of nationally or internationally recognized reputation and
responsibility; provided, however, that Lessee need not maintain such cargo
liability insurance, or may maintain such cargo liability insurance in an
amount less than $300 million per occurrence, so long as the amount of
cargo liability insurance, if any, maintained with respect to the Aircraft
is not less than the cargo liability insurance, if any, maintained for
other Airbus Model A___(12) aircraft owned or leased and operated by Lessee.
- -------------------
12 Insert "A319", "A320" or "A330", as applicable.
(2) During any period that the Airframe or an Engine, as the
case may be, is on the ground and not in operation, Lessee may carry or
cause to be carried as to such non-operating property, in lieu of the
insurance required by clause (1) above, and subject to the self-insurance
to the extent permitted by subsection (d) hereof, insurance by insurers of
nationally or internationally recognized reputation and responsibility
otherwise conforming with the provisions of said clause (1) except that (A)
the amounts of coverage shall not be required to exceed the amounts of
comprehensive airline liability from time to time applicable to property
owned or leased by Lessee of the same type as such non-operating property
and which is on the ground and not in operation; and (B) the scope of the
risks covered and the type of insurance shall be the same as from time to
time shall be applicable to aircraft owned or leased by Lessee of the same
type as such non-operating property and which is on the ground and not in
operation.
(b) Insurance Against Loss or Damage to the Aircraft. (1)
Except as provided in clause (2) of this subsection (b), and subject to the
provisions of subsection (d) of this Exhibit H permitting the
self-insurance, Lessee shall maintain or cause to be maintained in effect,
at its or any Sublessee's expense, with insurers of nationally or
internationally recognized responsibility, all-risk aircraft hull insurance
covering the Aircraft and fire and extended coverage and all-risk aircraft
hull insurance covering Engines and Parts while temporarily removed from
the Aircraft and not replaced by similar components; provided that such
insurance shall at all times while the Aircraft is subject to this Lease be
for an amount (taking into account the self-insurance to the extent
permitted by subsection (d) of this Exhibit H) not less than the
Termination Value for the Aircraft; provided further, that, subject to
compliance with subsection (d) of this Exhibit H, such all-risk property
damage insurance covering Engines and Parts temporarily removed from an
Airframe or an airframe or (in the case of Parts) an Engine need be
obtained only to the extent available at reasonable cost (as reasonably
determined by Lessee). In the case of a Loss with respect to an engine
(other than an Engine) installed on the airframe in circumstances which do
not constitute an Event of Loss with respect to the Airframe, Lessor shall
promptly remit any payment made to it of any insurance proceeds in respect
of such Loss to Lessee or any other third party that is entitled to receive
such proceeds.
Unless an Event of Default has occurred and is continuing, all
losses will be adjusted by Lessee with the insurers. As between Lessor and
Lessee, it is agreed that all insurance payments received as the result of
the occurrence of an Event of Loss will be applied as follows:
(x) if such payments are received with respect to the
Airframe (or the Airframe and the Engines installed thereon),
(i) unless such property is replaced pursuant to the last
paragraph of Section 10(a), so much of such payments remaining,
after reimbursement of Lessor (as provided in Section 7.01 of
the Trust Agreement) and the Owner Participant for reasonable
costs and expenses, as shall not exceed the Termination Value
and the other amounts payable pursuant to Section 10(a) hereof
shall be applied in reduction of Lessee's obligation to pay
such Termination Value and other amounts payable pursuant to
Section 10(a) hereof, if not already paid by Lessee, or, if
already paid by Lessee, shall be applied to reimburse Lessee
for its payment of such Termination Value and such other
amounts payable, and the balance, if any, of such payments
remaining thereafter will be paid over to, or retained by,
Lessee (or if directed by Lessee, any Sublessee); or (ii) if
such property is replaced pursuant to the last paragraph of
Section 10(a), such payments shall be paid over to, or retained
by, Lessee (or if directed by Lessee, any Sublessee), provided
that Lessee shall have fully performed or, concurrently
therewith, will fully perform the terms of the last paragraph
of Section 10(a) with respect to the Event of Loss for which
such payments are made; and
(y) if such payments are received with respect to an
Engine under the circumstances contemplated by Section 10(b)
hereof, so much of such payments remaining after reimbursement
of Lessor (as provided in Section 7.01 of the Trust Agreement)
and the Owner Participant for reasonable costs and expenses,
shall be paid over to, or retained by, Lessee (or if directed
by Lessee, any Sublessee), provided that Lessee shall have
fully performed or concurrently therewith will fully perform
the terms of Section 10(b) with respect to the Event of Loss
for which such payments are made.
As between Lessor and Lessee, the insurance payments for any
property damage loss to the Airframe or any engine not constituting an
Event of Loss with respect thereto will be applied in payment for repairs
or for replacement property in accordance with the terms of Sections 7 and
8, if not already paid for by Lessee (or any Sublessee), and any balance
(or if already paid for by Lessee (or any Sublessee), all such insurance
proceeds) remaining after compliance with such Sections with respect to
such loss shall be paid to Lessee (or any Sublessee if directed by Lessee).
(2) During any period that the Aircraft is on the ground and
not in operation, Lessee may carry or cause to be carried, in lieu of the
insurance required by clause (1) above, and subject to self-insurance to
the extent permitted by subsection (d) of this Exhibit H, insurance
otherwise conforming with the provisions of said clause (1) except that the
scope of the risks and the type of insurance shall be the same as from time
to time applicable to aircraft owned or leased by Lessee (or, if a Sublease
is then in effect, by Sublessee) of the same type as the Aircraft similarly
on the ground and not in operation, provided that, subject to
self-insurance to the extent permitted by subsection (d) of this Exhibit H,
Lessee shall maintain insurance against risk of loss or damage to the
Aircraft in an amount at least equal to the Termination Value of the
Aircraft during such period that the Aircraft is on the ground and not in
operation.
(3) If Lessee (or any Sublessee) shall at any time operate or
propose to operate the Aircraft, Airframe or any Engine (i) in any area of
recognized hostilities or (ii) on international routes, and war-risk,
hijacking or allied perils insurance is maintained by Lessee (or any
Sublessee) with respect to other aircraft owned and operated by Lessee (or
any Sublessee) on such routes or in such areas, Lessee shall maintain or
cause to be maintained war-risk, hijacking and related perils insurance of
substantially the same type carried by major United States commercial air
carriers operating the same or comparable models of aircraft on similar
routes or in such areas and in no event in an amount less than the
Termination Value.
(c) Reports, etc. Lessee will furnish, or cause to be
furnished, to Lessor, the Indenture Trustee, the Owner Participant and the
Pass Through Trustee, on or before the Delivery Date and on each annual
anniversary date of Lessee's applicable insurance, a report, signed by
Lessee's regular insurance broker or any other independent firm of
insurance brokers reasonably acceptable to Lessor which brokers may be in
the regular employ of Lessee (the "Insurance Brokers"), describing in
reasonable detail the hull and liability insurance (and property insurance
for detached engines and parts) then carried and maintained with respect to
the Aircraft and stating the opinion of such firm that the insurance
complies with the terms hereof; provided, that all information contained in
the foregoing report shall not be made available by Lessor, the Indenture
Trustee or the Owner Participant or the Pass Through Trustee to anyone
except (i) to prospective and permitted transferees of Lessor's, the Owner
Participant's, the Indenture Trustee's or the Pass Through Trustee's
interest or their respective counsel, independent certified public
accountants and independent insurance brokers or other agents, who agree to
hold such information confidential, (ii) to Lessor's, the Owner
Participant's, the Indenture Trustee's or a Pass Through Trustee's counsel
or independent certified public accountants, independent insurance brokers
or agents who agree to hold such information confidential or (iii) as may
be required by any statute, court or administrative order or decree or
governmental ruling or regulation; provided, however that any disclosure
permitted by clause (iii) above shall be made only to the extent necessary
to meet the specific requirements or needs of the Persons to whom such
disclosures are hereby permitted. Lessee will cause such Insurance Broker
to agree to advise Lessor, the Indenture Trustee, the Owner Participant and
the Pass Through Trustee in writing of any act or omission on the part of
Lessee of which it has knowledge and which might invalidate or render
unenforceable, in whole or in part, any insurance on the Aircraft and to
advise in writing at least thirty (30) days (ten (10) days in the case of
war risk and allied perils coverage and ten (10) days notice with respect
to the Electronic Date Recognition Exclusion Limited Coverage Endorsement),
prior to the cancellation or material adverse change of any insurance
maintained pursuant to Section 11, provided that if the notice period
specified above is not reasonably obtainable, the Insurance Broker shall
provide for as long a period of prior notice as shall then be reasonably
obtainable. In addition, Lessee will also cause such Insurance Brokers to
deliver to Lessor, the Indenture Trustee, the Owner Participant and the
Pass Through Trustee, on or prior to the date of expiration of any
insurance policy referenced in a previously delivered certificate of
insurance, a new certificate of insurance, substantially in the same form
as delivered by Lessee to such parties on the Delivery Date except for such
changes in the report or the coverage consistent with the terms hereof. In
the event that Lessee or any Sublessee shall fail to maintain or cause to
be maintained insurance as herein provided, Lessor or the Indenture Trustee
may at its sole option, but shall be under no duty to, provide such
insurance and, in such event, Lessee shall, upon demand, reimburse Lessor
or the Indenture Trustee, as Supplemental Rent, for the cost thereof to
Lessor or the Indenture Trustee, as the case may be; provided, however,
that no exercise by Lessor or the Indenture Trustee, as the case may be, of
said option shall affect the provisions of this Lease, including the
provisions of Section 14(g).
(d) Self-Insurance. Lessee may self-insure by way of
deductible, premium adjustment or franchise provisions or otherwise
(including, with respect to insurance maintained pursuant to subsection (b)
of this Exhibit H, insuring for an amount that is less than the Termination
Value of the Aircraft) the risks required to be insured against pursuant to
Section 11 under a program applicable to all aircraft (whether owned or
leased) in Lessee's fleet, but in no case shall the aggregate amount of
self-insurance in regard to subsection (a) and (b) of this Exhibit H exceed
for any policy year, with respect to all of the aircraft (whether owned or
leased) in Lessee's fleet (including, without limitation, the Aircraft),
the lesser of (i) 50% of the highest replacement value of any single
aircraft in Lessee's fleet or (ii) 1-1/2% of the average aggregate
insurable value (during the preceding policy year) of all aircraft
(including, without limitation, the Aircraft) on which Lessee carries
insurance, unless an insurance broker of national standing shall certify
that the standard among all other major United States airlines is a higher
level of self-insurance, in which case Lessee may insure the Aircraft to
such higher level. In addition to the foregoing right to self-insure,
Lessee (and any Sublessee) may self-insure to the extent of any applicable
mandatory minimum per aircraft (or, if applicable, per annum or other
period) hull or liability insurance deductible customary in the airline
industry imposed by the aircraft hull or liability insurer.
(e) Terms of Policies. Any policies of insurance carried in
accordance with subsection (a) or (b) of this Exhibit H and any policies
taken out in substitution or replacement for any of such policies (A) shall
be amended to name the Additional Insureds as their respective interests
may appear, (B) may provide for the self-insurance to the extent permitted
in subsection (d) of this Exhibit H, (C) shall provide that if the insurers
cancel such insurance for any reason whatever or if any material change is
made in such insurance which adversely affects the interest of the
Additional Insureds, or such insurance shall lapse for non-payment of
premium, such cancellation, lapse or change shall not be effective as to
the Additional Insureds for thirty (30) days (ten (10) days in the case of
war risk and allied perils coverage and ten (10) days in the case of
Electronic Date Recognition Limited Coverage Endorsement) after issuance to
the Additional Insureds, respectively, of written notice by such insurers
of such cancellation, lapse or change; provided, however, that if any
notice period specified above is not reasonably obtainable, such policies
shall provide for as long a period of prior notice as shall then be
reasonably obtainable, (D) shall provide that in respect of the respective
interests of the Additional Insureds in such policies the insurance shall
not be invalidated by any action or inaction of Lessee (or, if any Sublease
is then in effect, any Sublessee) or any other Person and shall insure the
Additional Insureds regardless of any breach or violation of any warranty,
declaration or condition contained in such policies by Lessee (or, if any
Sublease is then in effect, any Sublessee), (E) shall be primary without
right of contribution from any other insurance which is carried by any
Additional Insured, (F) shall expressly provide that all of the provisions
thereof, except the limits of liability, shall operate in the same manner
as if there were a separate policy covering each insured, (G) shall waive
any right of the insurers to any set-off or counterclaim or any other
deduction, whether by attachment or otherwise, in respect of any liability
of any Additional Insured to the extent of any moneys due to any Additional
Insured, and (H) shall provide that (i) in the event of a loss involving
proceeds in excess of $5,000,000, the proceeds in respect of such loss up
to an amount equal to the Termination Value for the Aircraft shall be
payable to Lessor (or, so long as the Trust Indenture shall not have been
discharged, the Indenture Trustee) (except in the case of a loss with
respect to an Engine installed on an airframe other than the Airframe, in
which case Lessee (or any Sublessee) shall arrange for any payment of
insurance proceeds in respect of such loss to be held for the account of
Lessor (or, so long as the Trust Indenture shall not have been discharged,
the Indenture Trustee) whether such payment is made to Lessee (or any
Sublessee) or any third party), it being understood and agreed that in the
case of any payment to Lessor (or the Indenture Trustee) otherwise than in
respect of an Event of Loss, Lessor (or the Indenture Trustee) shall, upon
receipt of evidence satisfactory to it that the damage giving rise to such
payment shall have been repaired or that such payment shall then be
required to pay for repairs then being made, pay the amount of such payment
(and all earnings thereon) to Lessee or its order, and (ii) the entire
amount of any loss involving proceeds of $5,000,000 or less or the amount
of any proceeds of any loss in excess of the Termination Value for the
Aircraft shall be paid to Lessee or its order unless an Event of Default
shall have occurred and be continuing and the insurers have been notified
thereof by Lessor or the Indenture Trustee.
Exhibit 4(a)(xvi)
Indenture
N___U_
Exhibit A-3 to Note Purchase Agreement
FORM OF LEASED AIRCRAFT INDENTURE
TRUST INDENTURE AND SECURITY AGREEMENT
(US Airways, Inc. Trust No. N___U_)
Dated as of __________ __, 199_
Between
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not in its individual capacity,
except as expressly stated herein,
but solely as Owner Trustee,
Owner Trustee
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION
Indenture Trustee
EQUIPMENT NOTES COVERING
ONE AIRBUS A3__ AIRCRAFT
BEARING U.S. REGISTRATION MARK N___U_
LEASED BY US AIRWAYS, INC.
Page
TABLE OF CONTENTS
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . 8
ARTICLE II THE EQUIPMENT NOTES . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2.01. Form of Equipment Notes. . . . . . . . . . . . . 8
SECTION 2.02. Issuance and Terms of Equipment Notes. . . . 14
SECTION 2.03. Payments from Trust Indenture Estate Only . . 17
SECTION 2.04. Method of Payment . . . . . . . . . . . . . . 18
SECTION 2.05. Application of Payments . . . . . . . . . . . 21
SECTION 2.06. Termination of Interest in Trust Indenture
Estate . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.07. Registration, Transfer and
Exchange of Equipment Notes . . . . . . . . . 22
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Equipment
Notes . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.09. Payment of Expenses on Transfer; Cancellation 24
SECTION 2.10. Mandatory Redemptions of Equipment Notes . . . 25
SECTION 2.11. Voluntary Redemptions of Equipment Notes . . . 25
SECTION 2.12. Redemptions; Notice of Redemption . . . . . . 25
SECTION 2.13. Assumption of Equipment Notes by Lessee . . . 27
SECTION 2.14. Option to Purchase Equipment Notes . . . . . . 27
SECTION 2.15. Subordination . . . . . . . . . . . . . . . . 29
ARTICLE III RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE . . . . . . . . . . . . . . . . 29
SECTION 3.01. Basic Rent Distribution . . . . . . . . . . . 29
SECTION 3.02. Event of Loss; Replacement;
Voluntary Termination;
Refinancing . . . . . . . . . . . . . . . . . 31
SECTION 3.03. Payments After Event of Default . . . . . . . 32
SECTION 3.04. Certain Payments . . . . . . . . . . . . . . . 34
SECTION 3.05. Other Payments . . . . . . . . . . . . . . . . 35
SECTION 3.06. Payments to Owner Trustee . . . . . . . . . . 36
ARTICLE IV COVENANTS OF OWNER TRUSTEE; EVENTS OF
DEFAULT; REMEDIES OF INDENTURE TRUSTEE . . . . . . . . . . . . . . . . 36
SECTION 4.01. Covenants of Owner Trustee . . . . . . . . . . 36
SECTION 4.02. Event of Default . . . . . . . . . . . . . . . 37
SECTION 4.03. Certain Rights . . . . . . . . . . . . . . . . 40
SECTION 4.04. Remedies . . . . . . . . . . . . . . . . . . . 42
SECTION 4.05. Return of Aircraft, Etc . . . . . . . . . . . 45
SECTION 4.06. Remedies Cumulative . . . . . . . . . . . . . 47
SECTION 4.07. Discontinuance of Proceedings . . . . . . . . 47
SECTION 4.08. Waiver of Past Defaults . . . . . . . . . . . 48
SECTION 4.09. Appointment of Receiver . . . . . . . . . . . 48
SECTION 4.10. Indenture Trustee Authorized
to Execute Bills of Sale, Etc. . . . . . . . . 48
SECTION 4.11. Rights of Note Holders to Receive Payment . . 49
ARTICLE V DUTIES OF THE INDENTURE TRUSTEE . . . . . . . . . . . . . . 49
SECTION 5.01. Notice of Event of Default . . . . . . . . . . 49
SECTION 5.02. Action upon Instructions;
Certain Rights and Limitations . . . . . . . . 50
SECTION 5.03. Indemnification. . . . . . . . . . . . . . . . 53
SECTION 5.04. No Duties Except as Specified
in Trust Indenture or
Instructions . . . . . . . . . . . . . . . . . 54
SECTION 5.05. No Action Except Under Lease,
Trust Indenture or
Instructions . . . . . . . . . . . . . . . . . 54
SECTION 5.06. Replacement Airframes and Replacement Engines 55
SECTION 5.07. Indenture Supplements for Replacements . . . . 55
SECTION 5.08. Effect of Replacement . . . . . . . . . . . . 55
SECTION 5.09. Investment of Amounts Held by Indenture Trustee 56
ARTICLE VI THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE . . . . . . . . 56
SECTION 6.01. Acceptance of Trusts and Duties. . . . . . . 56
SECTION 6.02. Absence of Duties. . . . . . . . . . . . . . 57
SECTION 6.03. No Representations or
Warranties as to Aircraft or
Documents. . . . . . . . . . . . . . . . . . 58
SECTION 6.04. No Segregation of Monies; No Interest. . . . . 58
SECTION 6.05. Reliance; Agreements; Advice of Counsel. . . 59
SECTION 6.06. Capacity in Which Acting. . . . . . . . . . . 60
SECTION 6.07. Compensation. . . . . . . . . . . . . . . . . 60
SECTION 6.08. Instructions from Note Holders. . . . . . . . 60
ARTICLE VII INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE . . 61
SECTION 7.01. Scope of Indemnification. . . . . . . . . . . 61
ARTICLE VIII SUCCESSOR AND SEPARATE TRUSTEES . . . . . . . . . . . . . 62
SECTION 8.01. Notice of Successor Owner Trustee. . . . . . . 62
SECTION 8.02. Resignation of Indenture
Trustee; Appointment of
Successor. . . . . . . . . . . . . . . . . . 62
SECTION 8.03. Appointment of Additional and Separate Trustees.6
4
ARTICLE IX SUPPLEMENTS AND AMENDMENTS TO THIS TRUST INDENTURE
AND OTHER DOCUMENTS . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 9.01. Instructions of Majority; Limitations. . . . . 66
SECTION 9.02. Trustees Protected. . . . . . . . . . . . . . 68
SECTION 9.03. Documents Mailed to Note Holders . . . . . . . 69
SECTION 9.04. No Request Necessary for Lease
Supplement or Trust Agreement
and Indenture Supplement. . . . . . . . . . . 69
ARTICLE X MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 10.01. Termination of Trust Indenture. . . . . . . . 69
SECTION 10.02. No Legal Title to Trust
Indenture Estate in Note
Holders. . . . . . . . . . . . . . . . . . . 70
SECTION 10.03. Sale of Aircraft by Indenture Trustee Is Binding70
SECTION 10.04. Trust Indenture for Benefit of
Owner Trustee, Indenture . . . . . . . . . . 70
SECTION 10.05. Notices. . . . . . . . . . . . . . . . . . . 71
SECTION 10.06. Severability. . . . . . . . . . . . . . . . . 71
SECTION 10.07. No Oral Modification or Continuing Waivers. . 72
SECTION 10.08. Successors and Assigns. . . . . . . . . . . . 72
SECTION 10.09. Headings. . . . . . . . . . . . . . . . . . . 72
SECTION 10.10. Normal Commercial Relations. . . . . . . . . 72
SECTION 10.11. Governing Law; Counterpart Form. . . . . . . . 73
SECTION 10.12. Voting By Note Holders. . . . . . . . . . . . 73
SECTION 10.13. Bankruptcy. . . . . . . . . . . . . . . . . . 73
SECTION 10.14. No Action Contrary to Lessee's
Rights Under the Lease. . . . . . . . . . . . 73
SCHEDULE I SERIES A . . . . . . . . . . . . . . . . . . . SCHEDULE I-2
SERIES B . . . . . . . . . . . . . . . . . . . SCHEDULE I-3
SERIES C . . . . . . . . . . . . . . . . . . . SCHEDULE I-4
SCHEDULE II PASS THROUGH TRUST AGREEMENT AND PASS THROUGH TRUST
SUPPLEMENTS . . . . . . . . . . . . . . . . SCHEDULE II-1
Indenture
N___U_
TRUST INDENTURE AND SECURITY AGREEMENT
(US Airways, Inc. Trust No. N___U_)
TRUST INDENTURE AND SECURITY AGREEMENT (US Airways, Inc. Trust
No. N___U_), dated as of _________ __, 199_ (as amended, modified or
supplemented from time to time, this "Trust Indenture"), between FIRST
SECURITY BANK, NATIONAL ASSOCIATION, a national banking association, not in
its individual capacity, except as expressly stated herein, but solely as
Owner Trustee under the Trust Agreement referred to below (together with
its successors under the Trust Agreement, the "Owner Trustee"), and STATE
STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a
national banking association, as Indenture Trustee hereunder (together with
its successors hereunder, the "Indenture Trustee").
W I T N E S S E T H
WHEREAS, the Owner Participant and the Owner Trustee have entered
into the Trust Agreement whereby, among other things, (i) the Owner Trustee
has established 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, and with the priority of
payment to, the holders of Equipment Notes issued hereunder, and (ii) the
Owner Trustee has been authorized and directed to execute and deliver this
Trust Indenture;
WHEREAS, the parties desire by this Trust Indenture, among other
things, (i) to provide for the issuance by the Owner Trustee to the Pass
Through Trustees (or their designee) of the Equipment Notes evidencing the
participation of the Pass Through Trustees in the payment of Lessor's Cost
for the Aircraft, as provided in the Participation Agreement and (ii) 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 all of the Owner Trustee's 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
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 2.15
and Article III hereof;
WHEREAS, all things have been done to make the Equipment Notes,
when executed by the Owner Trustee and authenticated and delivered by the
Indenture Trustee hereunder, the valid, binding and enforceable obligations
of the Owner Trustee; and
WHEREAS, all things necessary to make this Trust Indenture the
valid, binding and legal 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 TRUST INDENTURE AND SECURITY AGREEMENT
WITNESSETH, that, to secure (i) 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
(ii) the performance and observance by the Owner Trustee of all the
agreements, covenants and provisions herein and in the Participation
Agreement and the Equipment Notes contained, for the benefit of the Note
Holders, the Loan Participants and each of the Indenture Indemnitees and
the prompt payment of all amounts from time to time owing hereunder, under
the Participation Agreement and under the Lease to the Note Holders, the
Loan Participants or any Indenture Indemnitee by the Owner Trustee or
Lessee (the "Secured Obligations") and for the uses and purposes and
subject to the terms and provisions hereof, and in consideration of the
premises and of the covenants herein contained, and of the acceptance of
the Equipment Notes by the holders thereof, and for other good and valuable
consideration the receipt and adequacy whereof are hereby acknowledged, the
Owner Trustee has granted, assigned, transferred, conveyed, mortgaged,
pledged and confirmed, and does hereby grant, assign, transfer, convey,
mortgage, pledge and confirm, unto the Indenture Trustee, its successors in
trust and assigns, for the security and benefit of the Note Holders, a
first priority security interest in and mortgage lien on all right, title
and interest of the Owner Trustee in, to and under the following described
property, rights and privileges, other than Excluded Payments (which
collectively, excluding Excluded Payments but including all property
hereafter specifically subjected to the Lien of this Trust Indenture by the
Trust Agreement and Indenture Supplement or any mortgage 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 title as provided herein and in the Lease),
all as more particularly described in the Trust Agreement and Indenture
Supplement executed and delivered with respect to the Aircraft or any such
replacements or substitutions therefor, as provided in this Indenture;
(2) the Lease and any Lease Supplement and all Rent thereunder
(including, without limitation, all amounts of Basic Rent, EBO Amount,
Supplemental Rent and payments of any kind thereunder (excluding any
Excluded Payments)) and the right to receive Advances thereunder;
(3) the Purchase Agreement (to the extent specified in the
Purchase Agreement Assignment), the Purchase Agreement Assignment, the
Consent and Agreement and the Bill of Sale;
(4) all rents, issues, profits, revenues and other income of the
property subjected or required to be subjected to the Lien of this
Indenture;
(5) all insurance and requisition proceeds with respect to the
Aircraft, including but not limited to the insurance required under Section
11 of the Lease, but excluding insurance proceeds described in clauses (ii)
and (iii) of the definition of Excluded Payments;
(6) all monies and securities from time to time deposited or
required to be deposited with the Indenture Trustee pursuant to any terms
of this Indenture or the Lease or required hereby or by the Lease to be
held by the Indenture Trustee hereunder (other than Excluded Payments); and
(7) all proceeds of the foregoing.
BUT EXCLUDING from the foregoing and from the Trust Indenture
Estate all Excluded Payments, and the right to enforce and collect the
same, and SUBJECT TO all of the terms and conditions of this Trust
Indenture and the rights of the Owner Trustee and the Owner Participant
hereunder.
Concurrently with the delivery hereof, the Owner Trustee is
delivering to the Indenture Trustee the original executed counterpart of
the Lease and the Lease Supplement No. 1 (to each of which a chattel paper
receipt is attached), and executed copies of the Participation Agreement,
the French Pledge Agreement and the Purchase Agreement Assignment with the
Consent and Agreement attached thereto.
TO HAVE AND TO HOLD all and singular the aforesaid property unto
the Indenture Trustee, and its successors and assigns, in trust for the
benefit and security of the Note Holders, the Loan Participants and the
Indenture Indemnitees except as provided in Section 2.15 and Article III
hereof without any preference, distinction or priority of any one Equipment
Note over any other by reason of priority of time of issue, sale,
negotiation, date of maturity thereof or otherwise for any reason
whatsoever, and for the uses and purposes and in all cases and as to all
property specified in paragraphs (1) through (7) inclusive above, subject
to the terms and provisions set forth in this Trust Indenture.
It is expressly agreed that anything herein contained to the
contrary notwithstanding, the Owner Trustee shall remain liable under each
of the Indenture Agreements to which it is a party to perform all of the
obligations assumed by it thereunder, except to the extent prohibited or
excluded from doing so pursuant to the terms and provisions thereof, and
the Loan Participants, Indenture Indemnitees, Indenture Trustee and the
Note Holders shall have no obligation or liability under the Indenture
Agreements, by reason of or arising out of the assignment hereunder, nor
shall the Loan Participants, Indenture Indemnitees, 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 Agreements to which it is a party, 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.
Notwithstanding the above, the Indenture Trustee agrees, for the
benefit of AVSA, S.A.R.L., that in exercising or assigning any rights under
the Purchase Agreement Assignment, the terms and conditions of the Purchase
Agreement Assignment shall apply to, and be binding upon, the Indenture
Trustee.
The Owner Trustee does hereby constitute the Indenture Trustee
the true and lawful attorney of the Owner Trustee, irrevocably, granted for
good and valuable consideration and coupled with an interest and with full
power of substitution, and with full power (in the name of the Owner
Trustee or otherwise) to ask for, require, demand, receive, compound and
give acquittance for any and all monies and claims for monies (in each case
including insurance and requisition proceeds but in all cases excluding
Excluded Payments) due and to become due under or arising out of the
Indenture Agreements, 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. Without
limiting the generality of the foregoing, but subject to the rights of the
Owner Trustee and the Owner Participant hereunder, during the continuance
of any Event of Default under this Trust Indenture, the Indenture Trustee
shall have the right under such power of attorney to accept any offer in
connection with the exercise of remedies as set forth herein of any
purchaser to purchase the Airframe and Engines and upon such purchase to
execute and deliver in the name of and on behalf of the Owner Trustee an
appropriate bill of sale and other instruments of transfer relating to the
Airframe and Engines, when purchased by such purchaser, and to perform all
other necessary or appropriate acts with respect to any such purchase, and
in its discretion to file any claim or take any other action or
proceedings, either in its own name or in the name of the Owner Trustee or
otherwise, which the Indenture Trustee may deem necessary or appropriate to
protect and preserve the right, title and interest of the Indenture Trustee
in and to such Rents and other sums and the security intended to be
afforded hereby; provided, however, that no action of the Indenture Trustee
pursuant to this paragraph shall increase the obligations or liabilities of
the Owner Trustee to any Person beyond those obligations and liabilities
specifically set forth in this Trust Indenture and in the other Operative
Documents. Under the Lease, Lessee is directed, so long as this Trust
Indenture shall not have been fully discharged, to make all payments of
Rent (other than Excluded Payments) and all other amounts which are
required to be paid to or deposited with the Owner Trustee pursuant to the
Lease (other than Excluded Payments) directly to, or as directed by, the
Indenture Trustee at such address or addresses as the Indenture Trustee
shall specify, for application as provided in this Trust Indenture. The
Owner Trustee agrees that promptly upon receipt thereof, it will transfer
to the Indenture Trustee any and all monies from time to time received by
it constituting part of the Trust Indenture Estate, for distribution by the
Indenture Trustee pursuant to this Trust Indenture, except that the Owner
Trustee shall accept for distribution pursuant to the Trust Agreement any
amounts distributed to it by the Indenture Trustee under this Trust
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 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 benefits of the assignment hereunder and of the rights and
powers herein granted. The parties hereto acknowledge that neither the
Owner Trustee nor the Owner Participant shall have any obligation as to any
recording, filing, refiling or re-recording of any documents or instruments
in regard to maintaining the perfection of the security interests created
hereunder, in the Trust Indenture Estate or any security interest that may
be claimed to have been created by the Lease or the ownership interest of
the Owner Trustee in the Aircraft.
The Owner Trustee does hereby warrant and represent that it has
not assigned or pledged, and hereby covenants and agrees that it will not
assign or pledge, so long as the assignment hereunder shall remain in
effect, and the Lien hereof shall not have been released pursuant to
Section 10.01 hereof, any of its right, title or interest hereby assigned,
to anyone other than the Indenture Trustee, and that it will not, except as
otherwise provided in this Trust Indenture and except with respect to
Excluded Payments to which it is entitled, (i) accept any payment from
Lessee under any Indenture Agreement, (ii) enter into any agreement
amending or supplementing any Indenture Agreement, (iii) execute any waiver
or modification of, or consent under, the terms of, or exercise any rights,
powers or privileges under, any Indenture Agreement, (iv) settle or
compromise any claim (other than those relating to an Excluded Payment)
arising under any Indenture Agreement or (v) submit or consent to the
submission of any dispute, difference or other matter arising under or in
respect of any Indenture Agreement to arbitration thereunder.
The Owner Trustee does hereby further agree that it will not
without the written consent of the Indenture Trustee:
(a) collect or agree to the receipt or collection of any payment
of Rent (other than Excluded Payments), including Basic
Rent, EBO Amount, Termination Value or any other payment to
be made pursuant to Section 9, 10, 19 or 20 of the Lease
prior to the date for the payment thereof provided for by
the Lease or assign, transfer or hypothecate (other than to
the Indenture Trustee hereunder) any payment of Rent (other
than Excluded Payments), including Basic Rent, EBO Amount,
Termination Value or any other payment to be made pursuant
to Section 9, 10, 19 or 20 of the Lease, then due or to
accrue in the future under the Lease in respect of the
Airframe and Engines; or
(b) except as contemplated by the Trust Agreement in connection
with the appointment of a successor owner trustee, sell,
mortgage, transfer, assign or hypothecate (other than to the
Indenture Trustee hereunder) its interest in the Airframe
and Engines or any part thereof or in any amount to be
received by it from the use or disposition of the Airframe
and Engines, other than amounts distributed to it pursuant
to Article III hereof.
It is hereby further agreed that any and all property described
or referred to in the granting clauses hereof which is hereafter acquired
by the Owner Trustee shall ipso facto, and without any further conveyance,
assignment or act on the part of the Owner Trustee or the Indenture
Trustee, become and be subject to the Lien herein granted as fully and
completely as though specifically described herein, but nothing contained
in this paragraph shall be deemed to modify or change the obligations of
the Owner Trustee contained in the foregoing paragraphs.
The Owner Trustee does hereby ratify and confirm the Lease and
does hereby agree that it will not violate any covenant or agreement made
by it therein, herein or in any of the other Owner Trustee Documents.
Notwithstanding the Granting Clause or any of the foregoing
paragraphs, there is hereby excluded from the foregoing sale, transfer,
assignment, grant, pledge and security interest all Excluded Payments.
IT IS HEREBY COVENANTED AND AGREED by and between the parties
hereto as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. For all purposes of this Indenture,
capitalized terms used but not defined herein shall have the respective
meanings set forth or incorporated by reference, and shall be construed and
interpreted in the manner described, in Annex A.
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.
FIRST SECURITY BANK, NATIONAL ASSOCIATION, AS OWNER TRUSTEE UNDER
TRUST AGREEMENT (US AIRWAYS, INC. TRUST NO. N___U_) DATED AS OF
_______ __, ____.
SERIES [___] NON-RECOURSE EQUIPMENT NOTE DUE [___] ISSUED IN
CONNECTION WITH THE AIRBUS A-___ AIRCRAFT BEARING UNITED STATES
REGISTRATION NUMBER _____.
No.____ Date: [______,__] $________________
INTEREST RATE MATURITY DATE
[____] [___________,_____]
FIRST SECURITY BANK, NATIONAL ASSOCIATION, not in its individual
capacity but solely as Owner Trustee (herein in such capacity called the
"Owner Trustee") under that certain Trust Agreement (US Airways, Inc.
Trust No. N___U_), dated as of _________ __, ____, between the Owner
Participant named therein and the Owner Trustee (herein as such Trust
Agreement may be supplemented or amended from time to time called the
"Trust Agreement"), hereby promises to pay to ___________, or the
registered assignee thereof, the principal sum of $_________ (the
"Principal Amount"), together with interest on the amount of 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 Interest Rate indicated
above. The Principal Amount of this Equipment Note shall be payable on the
dates and in the installments as set forth in Schedule I hereto. Accrued
but unpaid interest shall be due and payable in semi-annual installments
commencing January 20, 2000, and thereafter on January 20 and July 20 of
each year, to and including _______, _____. Notwithstanding the foregoing,
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. Notwithstanding anything to the contrary contained herein, 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 with the same
force and effect as if made on such scheduled date and if such payment is
made on such next succeeding Business Day, no interest shall accrue on the
amount of such payment from and after such scheduled date.
For purposes hereof, the term "Trust Indenture" means the Trust
Indenture and Security Agreement (US Airways, Inc. Trust No. N___U_), dated
as of ___________ __, ____, between the Owner Trustee and State Street Bank
and Trust Company of Connecticut, National Association (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 Trust 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).
The holder hereof, by its acceptance of this Equipment Note agrees
that as between it and the Owner Trustee, except as expressly provided in
the Trust Indenture, the Participation Agreement or any other Operative
Document, the obligation to make all payments of the Principal Amount of,
interest on, Make-Whole Amount, if any, and all other amounts due hereunder
and the performance by the Owner Trustee of every obligation or covenant
contained in the Trust Indenture and in the Participation 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 Section 2.03 and Article III of
the Trust 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, in its individual capacity, or the Indenture Trustee is
personally liable or liable in any manner 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 expressly
provided in the Trust Indenture or in the Participation Agreement, for any
liability under the Trust Indenture or the Participation Agreement;
provided, however, that nothing herein contained shall limit, restrict or
impair the right of the Indenture Trustee, subject always to the terms and
provisions of the Trust Indenture, to accelerate the maturity of this
Equipment Note upon occurrence of an Event of Default under the Trust
Indenture in accordance with Section 4.04(b) of the Trust Indenture, to
bring suit and obtain a judgment against the Owner Trustee on this
Equipment Note for purposes of realizing upon the Trust Indenture Estate
and to exercise all rights and remedies provided under the Trust Indenture
or otherwise realize upon the Trust Indenture Estate.
There shall be maintained an Equipment Note 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 Trust Indenture.
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
Trust 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 Trust Indenture, each payment of an
installment of the Principal Amount, Make-Whole Amount, if any, and
interest 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, or, to the
extent permitted by Law, any overdue interest and other amounts hereunder)
to the date of such payment, second, to the payment of the Principal Amount
of this Equipment Note (or portion hereof) then due (other than by reason
of redemption), third, to the payment of Make-Whole Amount, if any, and any
other amount due hereunder or under the Trust Indenture, and fourth, the
balance, if any, remaining thereafter, to the payment of the Principal
Amount hereof remaining unpaid and due by reason of redemption. The
amounts paid pursuant to clause fourth of the preceding sentence shall be
applied to installments of the Principal Amount of this Equipment Note
remaining unpaid in the inverse order of their normal maturity.
This Equipment Note is one of the Equipment Notes referred to in
the Trust Indenture which have been or are to be issued by the Owner
Trustee pursuant to the terms of the Trust 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
Trust Indenture. Reference is hereby made to the Trust Indenture and the
Participation 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 Trust Indenture, as well as for a
statement of the terms and conditions of the Trust created by the Trust
Indenture, to all of which terms and conditions in the Trust Indenture and
the Participation Agreement each holder hereof agrees by its acceptance of
this Equipment Note.
As provided in the Trust Indenture and subject to certain
limitations therein set forth, this Equipment Note is exchangeable for a
like aggregate Principal Amount of Equipment Notes of different authorized
denominations, as requested by the holder surrendering the same.
Prior to the due presentment for registration of transfer of this
Equipment Note, the Owner Trustee and the Indenture Trustee shall deem and
treat the Person in whose name this Equipment Note is registered on the
Equipment Note Register as the absolute owner and holder hereof for the
purpose of receiving all amounts payable with respect to this Equipment
Note and for all purposes, 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, 2.11 and 2.12 of the Trust Indenture but not otherwise.
This Equipment Note is also subject to assumption by Lessee as provided in
Section 2.13 of the Trust Indenture, to exchange and to purchase by the
Owner Participant or the Owner Trustee as provided in Section 2.14 of the
Trust Indenture but not otherwise.
[The indebtedness evidenced by this Equipment Note is, to the
extent and in the manner provided in the Trust Indenture, subordinate and
subject in right of payment to the prior payment in full of the Secured
Obligations (as defined in the Trust Indenture) in respect of [Series A
Equipment Notes](1) [Series A and Series B Equipment Notes](2) , and this
Equipment Note is 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 its behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in the Trust Indenture and (c)
appoints the Indenture Trustee its attorney-in-fact for such purpose.](3)
- --------------------------
(1) To be inserted in the case of a Series B Equipment Note.
(2) To be inserted in the case of a Series C Equipment Note.
(3) To be inserted for each Equipment Note other than any
Series A Equipment Note.
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 Trust
Indenture or be valid or obligatory for any purpose.
THIS EQUIPMENT NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
* * *
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.
FIRST SECURITY BANK,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: ____________________________
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OFAUTHENTICATION
This is one of the Equipment Notes referred to in the within-
mentioned Trust Indenture.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Indenture Trustee
By: ____________________________
Name:
Title:
SCHEDULE I
EQUIPMENT NOTES AMORTIZATION
Payment Date Principal Amount to be Paid
* * *
SECTION 2.02. Issuance and Terms of Equipment Notes.
The Equipment Notes shall be dated the date of issuance thereof,
shall be issued in three separate series consisting of Series A, Series B
and Series C and in the maturities and principal amounts and shall bear
interest as specified in Schedule I hereto. On the date hereof, each
Equipment Note shall be issued to the Pass Through Trustees (or their
designee) under the Pass Through Agreements as set forth in Schedule II
hereto in connection therewith. 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 20, 2000, and on each January 20
and July 20 thereafter until maturity. The Principal Amount of each
Equipment Note shall be payable on the dates and in the installments as set
forth in Schedule I which shall be attached 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
Principal Amount and all accrued and unpaid interest on, and any other
amounts due under, such Equipment Note. Each Equipment 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 with the same force and
effect as if made on such scheduled date and if such payment is made on
such next succeeding Business Day, no interest shall accrue on the amount
of such payment from and after such scheduled date.
The Owner Trustee agrees to pay to the Indenture Trustee for
distribution in accordance with Section 3.04 hereof (i) to the extent not
payable (whether or not in fact paid) under Section 7(a) of the Note
Purchase Agreement (as originally in effect or as amended with the consent
of the Owner Participant) an amount or amounts equal to the fees payable to
the Liquidity Provider under Section 2.03 of each Liquidity Facility and
the related Fee Letter (as defined in the Intercreditor Agreement)
multiplied by a fraction the numerator of which shall be the then
outstanding aggregate principal amount of the Series A Equipment Notes,
Series B Equipment Notes and Series C Equipment Notes and the denominator
of which shall be the then outstanding aggregate principal amount of all
"Series A Equipment Notes", "Series B Equipment Notes" and "Series C
Equipment Notes" (in each case as defined in the relevant Operative
Indenture) issued under the Operative Indentures; (ii) (x) the amount equal
to interest on any Downgrade Advance (other than any Applied Downgrade
Advance) payable under Section 3.07 of each Liquidity Facility minus
Investment Earnings from such Downgrade Advance multiplied by (y) the
fraction specified in the foregoing clause (i); (iii) (x) the amount equal
to interest on any Non-Extension Advance (other than any Applied Non-
Extension Advance) payable under Section 3.07 of each Liquidity Facility
minus Investment Earnings from such Non-Extension Advance multiplied by (y)
the fraction specified in the foregoing clause (i); (iv) if any payment
default shall have occurred and be continuing with respect to interest on
any Series A Equipment Note, Series B Equipment Note or Series C Equipment
Note, (x) the excess, if any, of (1) the amount equal to interest on any
Unpaid Advance, Applied Downgrade Advance or Applied Non-Extension
Advance payable under Section 3.07 of each Liquidity Facility over (2)
the sum of Investment Earnings from any Final Advance plus any amount of
interest at the Past Due Rate actually payable (whether or not in fact
paid) by the Owner Trustee in respect of the overdue scheduled interest on
the Equipment Notes in respect of which such Unpaid Advance, Applied
Downgrade Advance or Applied Non-Extension Advance was made multiplied by
(y) a fraction the numerator of which shall be the then aggregate overdue
amounts of interest on the Series A Equipment Notes, Series B Equipment
Notes and Series C Equipment Notes (other than interest becoming due and
payable solely as a result of acceleration of any such Equipment Notes)
and the denominator of which shall be the then aggregate overdue amounts of
interest on all "Series A Equipment Notes", "Series B Equipment Notes" and
"Series C Equipment Notes" (in each case as defined in the relevant
Operative Indenture) issued under the Operative Indentures (other than
interest becoming due and payable solely as a result of acceleration of any
such "Equipment Notes") and (v) any other amounts owed to the Liquidity
Provider by the Subordination Agent as borrower under each Liquidity
Facility (other than amounts due as repayment of advances thereunder or as
interest on such advances), except to the extent payable pursuant to clause
(i), (ii), (iii) or (iv) above multiplied by the fraction specified in the
foregoing clause (i). For purposes of this paragraph, the terms "Applied
Downgrade Advance", "Applied Non-Extension Advance", "Cash Collateral
Account", "Downgrade Advance", "Final Advance", "Investment Earnings",
"Non-Extension Advance" and "Unpaid Advance" shall have the meanings
specified in each Liquidity Facility or the Intercreditor Agreement.
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 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 entitled to any benefit
under this Trust 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, liens or security interests of the Note Holders under this
Trust Indenture, each Note Holder, by its acceptance of an Equipment Note,
agrees that as between it and the Owner Trustee, except as expressly
provided in this Trust Indenture, the Participation Agreement or any other
Operative Document, (i) the obligation to make all payments 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 Trust
Indenture and in the Participation 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 Trust Indenture and any agreement
referred to herein 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 Trust Indenture or such other agreements to the contrary
notwithstanding (except for any express provisions or representations that
the Owner Trustee is responsible for, or is making, in its individual
capacity, for which there would be personal liability of the Owner
Trustee), no recourse shall be had with respect to this Trust Indenture or
such other agreements against the Owner Trustee in its individual capacity
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 Owner Trustee, in its individual capacity, 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 Participation Agreement or any of the
other Operative Documents or under the Equipment Notes except as expressly
provided herein or in the Participation Agreement; provided, however, that
nothing contained in this Section 2.03(a) shall be construed to limit the
exercise and enforcement in accordance with the terms of this Trust
Indenture or such other agreements of rights and remedies against the Trust
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 Owner Trustee (in its individual capacity) or the
Owner Participant is required, by reason of the Owner Trustee (in its
individual capacity) or the Owner Participant being held to have recourse
liability to any Note Holder or the Indenture Trustee, directly or
indirectly (other than the recourse liability of the Owner Trustee (in its
individual capacity)), to make payment on account of any amount payable as
principal, 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 Indenture Excess Amount (as
hereinafter defined) which reflects any payment by the Owner Trustee (in
its individual capacity) or the Owner Participant on account of clause (ii)
above, then such Note Holder or the Indenture Trustee, as the case may be,
shall promptly refund to the Owner Trustee (in its individual capacity) or
the Owner Participant (whichever shall have made such payment) such
Indenture Excess Amount.
For purposes of this Section 2.03(b), "Indenture 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 Owner
Trustee (in its individual capacity) or the Owner Participant had not
become subject to the recourse liability referred to in clause (ii) above.
Nothing contained in this Section 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 Owner Trustee (in its individual
capacity) or the Owner Participant under the Participation Agreement or
this Trust Indenture (and any exhibits or annexes hereto or thereto) or by
separate agreement or from retaining any amount paid by Owner Participant
under Section 2.14 or 4.03 hereof.
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 11:00 a.m., 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. 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 Trust 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, agrees to compensate such holders for loss of
use of funds at the Federal Funds Rate 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
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 other
provision of this Trust 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 in view of the time of day when the funds to
be so transferred were received by it if such funds were received after
11:00 a.m., 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 Equipment Note 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. So long
as any signatory to the Participation 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 I thereto and otherwise in the
manner provided in or pursuant to the Participation 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 Lessee) appropriate receipts
showing the payment thereof, together with such additional documentary
evidence as any such Note Holder 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 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 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. Neither the Owner
Participant nor the Owner Trustee shall be liable if the Indenture Trustee
fails to withhold withholding taxes in accordance with this Section 2.04 or
if any Note Holder provides false or inaccurate information on any form
required to be delivered under this Section 2.04.
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 (other than by reason of
redemption);
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 and
due by reason of redemption (provided that such Equipment Note shall not be
subject to redemption except as provided in Sections 2.10, 2.11 and 2.12
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 and Indenture Indemnitees shall not, as such, have
any further interest in, or other right with respect to, the Trust
Indenture Estate when and if the Secured Obligations due to such Note
Holder or Indenture Indemnitee shall have been paid in full.
SECTION 2.07. Registration, Transfer and Exchange of Equipment
Notes.
The Indenture Trustee shall keep a register (the "Equipment Note
Register") in which the Indenture Trustee shall provide for 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 Equipment Note Register
shall be kept at the Corporate Trust Office of the Indenture Trustee. The
Indenture Trustee is hereby appointed "Equipment Note 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 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 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 Trust 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 Trust Indenture, as the Equipment
Notes surrendered upon such registration of transfer or exchange. Every
Equipment Note presented or surrendered for registration of transfer, 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 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. The Owner Trustee shall not be
required to exchange any surrendered Equipment Notes as provided above
during the ten-day period preceding the due date of any payment on such
Equipment Note. The Owner Trustee shall in all cases deem the Person in
whose name any Equipment Note shall have been issued and registered as the
absolute owner and holder of such Equipment Note for the purpose of
receiving payment of all amounts payable by the Owner Trustee with respect
to such Equipment Note and for all purposes until a notice stating
otherwise is received from the Indenture Trustee and such change is
reflected on the Equipment Note Register. 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 Participation Agreement applicable to Note Holders,
including Sections 5, 7(a), 7(c), 7(g), 7(h), 7(n), 7(q), 7(u) and 7(z), 9,
12(a), 12(b), 14(b) and 14(e), and shall be deemed to have represented and
warranted (except as provided above), and covenanted, to the parties to the
Participation Agreement as to the matters represented, warranted and
covenanted by the Purchasers in the Participation Agreement. 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 ten (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 issued in
connection with the Aircraft. If the Equipment Note being replaced has
become mutilated, such Equipment Note shall be surrendered to the Indenture
Trustee and a photocopy 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 Owner Trustee, the
Owner Participant and the Indenture Trustee such security or indemnity as
may be required by them to save the Owner Trustee, the Owner Participant
and the Indenture Trustee harmless and evidence satisfactory to 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 "qualified institutional buyer" of the type referred to in
paragraph (a)(l)(i)(A), (B), (D) or (E) of Rule 144A under the Securities
Act (a "QIB") is the holder of any such destroyed, lost or stolen Equipment
Note, then the written indemnity of such QIB, signed by an authorized
officer thereof, in favor of, delivered to and in form reasonably
satisfactory to 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 Note. Subject to
compliance by the Note Holder of the requirements set forth in this Section
2.08, the Indenture Trustee and the Owner Trustee shall use all reasonable
efforts to issue new Equipment Notes within ten (10) Business Days of the
date of the written request therefor from the Note Holder.
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 Equipment Note 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.
(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.
(a) On the date on which Lessee is required pursuant to Section
10(a)(i) 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 the date of redemption and
all other amounts payable hereunder or under the Participation Agreement to
the Note Holders but without the Make-Whole Amount.
(b) If the Lease is terminated with respect to the Aircraft by
Lessee pursuant to Section 9, Section 19(b) or Section 20 thereof and
Lessee shall not have assumed all of the obligations of the Owner Trustee
hereunder pursuant to Section 2.13 and Section 7(u) of the Participation
Agreement, on the date the Lease is so terminated all the Equipment Notes
shall be redeemed in whole at a redemption price equal to 100% of the
unpaid Principal Amount thereof, together with accrued interest thereon to
the date of redemption and all other amounts payable hereunder or under the
Participation Agreement to the Note Holders plus the Make-Whole Amount, if
any.
SECTION 2.11. Voluntary Redemptions of Equipment Notes.
All, but not less than, all of the Equipment Notes may be
redeemed by the Owner Trustee with the prior consent of Lessee upon at
least 20 days revocable prior written notice to the Indenture Trustee, at a
redemption price equal to 100% of the unpaid Principal Amount thereof,
together with accrued interest thereon to the date of redemption and all
other amounts payable hereunder or under the Participation Agreement to the
Note Holders plus the Make-Whole Amount, if any.
SECTION 2.12. 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 Trust 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 Equipment Note Register; provided, that in the case of a redemption
to be made pursuant to Section 2.10(b) or Section 2.11, such notice shall
be revocable and shall be deemed revoked in the event that the Lease does
not in fact terminate on the specified termination date or if notice of
such redemption shall have been given in connection with a refinancing of
Equipment Notes and the Indenture Trustee receives written notice of such
revocation from Lessee or the Owner Trustee not later than three days prior
to the redemption date. All notices of redemption 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, if any such
Equipment Notes are then outstanding, 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
11:00 a.m. 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 (and not deemed revoked as contemplated in the proviso to Section
2.12(b)), 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 or at any office or agency maintained for such
purposes pursuant to Section 2.07, 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 2.13. Assumption of Equipment Notes by Lessee.
If, in accordance with Section 7(u) of the Participation
Agreement Lessee shall assume (on a full recourse basis) all of the
obligations of the Owner Trustee hereunder, under the Equipment Notes and
all other Operative Documents by supplemental indenture satisfactory to the
Indenture Trustee (which shall contain (i) the provisions substantially
similar to Sections 6, 7, 8, 10, 11 and 12 of the Lease and (ii) other
provisions necessary or advisable to effectuate such assumption), then upon
delivery of such supplemental indenture, payment by Lessee of all expenses
(including reasonable fees and expenses of counsel) for the Owner Trustee
and the Owner Participant and delivery of an opinion of counsel for Lessee
that such assumption has been duly and validly effected, the Owner Trustee
shall be released and discharged from any further obligations hereunder and
under the Equipment Notes and all other Operative Documents and the Owner
Participant shall be released and discharged from any further obligations
under the Participation Agreement and any other Operative Document to which
it is a party, except with respect to any such obligations that accrued
prior thereto.
SECTION 2.14. 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 2.14, 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
Trust Indenture and the Equipment Notes held by it, and such purchaser or
its nominee shall assume all of such holder's obligations under the
Participation Agreement and hereunder.
Such option to purchase the Equipment Notes may be exercised by
the Owner Trustee or the Owner Participant at any time following the
occurrence of 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 Participation 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 one hundred eighty (180) days
a Lease Event of Default, the purchase price thereof shall equal the price
provided in the preceding sentence plus the Make-Whole Amount, if any.
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 (i) shall
specify a date for such purchase not more than thirty (30) days or less
than fifteen (15) days after the date of such notice and (ii) may specify
that its election of such option is contingent upon the trustee or the
debtor-in-possession in a proceeding involving Lessee under Chapter 11 of
the Bankruptcy Code not entering into an agreement during the Section 1110
Period to perform the Lease. 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 (subject
to the provision in clause (ii) of the first sentence of this paragraph)
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, charges and expenses required pursuant to Section 2.09 in
connection with the issuance of such new Equipment Note shall be borne by
the Owner Participant.
SECTION 2.15. 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) hereof, except as
expressly provided in Article 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 2.15
or Article III hereof, it will hold any amount so received in trust for the
Senior Holder (as defined in Section 2.15(c) hereof) and will forthwith
turn over such payment to the Indenture Trustee in the form received to be
applied as provided in Article III hereof.
(c) As used in this Section 2.15, the term "Senior Holder" 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 and (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.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE TRUST INDENTURE ESTATE
SECTION 3.01. Basic Rent Distribution.
Except as otherwise provided in Sections 3.02 and 3.03 hereof,
each installment of Basic Rent, any payment of interest on overdue
installments of Basic Rent [,any payment received from the Owner
Participant pursuant to Section 7(cc) of the Participation Agreement](4) and
any payment received by the Indenture Trustee pursuant to Section 4.03
hereof 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
any overdue Principal Amount and, to the extent permitted by applicable
law, on any overdue interest and any other overdue amounts) then due 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 paragraph (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 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; and (iii) after giving effect to paragraph
(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 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
Second, the balance, if any, of such installment remaining
thereafter shall be distributed to the Owner Trustee free and clear of the
Lien of this Indenture; provided, however, that if an Event of 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 5.09 hereof until whichever of the following shall
first occur: (i) all Events of Default shall have been cured or waived, in
which event such balance shall be distributed as provided in this clause
"Second" without reference to this proviso, (ii) Section 3.03 hereof shall
be applicable, in which event such balance shall be distributed in
accordance with the provisions of such Section 3.03, or (iii) the 120th day
after the receipt of such payment in which case such payment shall be
- ------------------------
(4) For deferred equity transactions only.
distributed as provided in this clause "Second" without reference to this
proviso.
SECTION 3.02. Event of Loss; Replacement; Voluntary
Termination; Refinancing.
Except as otherwise provided in Section 3.03 hereof, any payments
received by the Indenture Trustee (i) with respect to the Aircraft as the
result of an Event of Loss, (ii) pursuant to a voluntary termination of the
Lease pursuant to Section 9, 19(b) or 20 thereof, (iii) in connection with
a refinancing of the Equipment Notes pursuant to Section 16 of the
Participation Agreement or (iv) in connection with any optional redemption
of the Equipment Notes effected in accordance with the Operative Documents,
shall be applied to redemption of the Equipment Notes, to payment of the
Secured Obligations or to the Indenture Trustee or any Note Holder under
the Participation Agreement by applying such funds in the following order
of priority:
First, (i) to reimburse the Indenture Trustee and the Note
Holders for any reasonable costs or expenses incurred in connection with
such redemption for which they are entitled to reimbursement, or indemnity
by Lessee, under the Operative Documents and then (ii) to pay any other
amounts then due to the Indenture Trustee and the Note Holders under this
Trust Indenture, the Participation Agreement or the Equipment Notes (other
than amounts specified in clause Second below);
Second, (i) to pay the amounts specified in paragraph (i) of
clause "Third" of Section 3.03 hereof plus Make-Whole Amount, if any, then
due and payable in respect of the Series A Equipment Notes; (ii) after
giving effect to paragraph (i) above, to pay the amounts specified in
paragraph (ii) of clause "Third" of Section 3.03 hereof plus Make-Whole
Amount, if any, then due and payable in respect of the Series B Equipment
Notes; and (iii) after giving effect to paragraph (ii) above, to pay the
amounts specified in paragraph (iii) of clause "Third" of Section 3.03
hereof plus Make-Whole Amount, if any, then due and payable in respect of
the Series C Equipment Notes; and
Third, as provided in clause "Fourth" of Section 3.03 hereof;
provided, however, that if a Replacement Airframe or Replacement Engine
shall be substituted for the Airframe or Engine subject to such Event of
Loss as provided in Section 10 of the Lease and as permitted by Section
5.06 hereof, any insurance, condemnation or similar proceeds which result
from such Event of Loss and are paid over to the Indenture Trustee shall be
held by the Indenture Trustee as permitted by Section 6.04 hereof (provided
that such moneys shall be invested as provided in Section 5.09 hereof) as
additional security for the obligations of Lessee under the Lessee
Documents and, unless otherwise applied pursuant to the Lease, such
proceeds (and such investment earnings) shall be released to Lessee at
Lessee's written request upon the release of such damaged Airframe or
Engine and the replacement thereof as provided in the Lease.
SECTION 3.03. Payments After Event of Default.
Except as otherwise provided in Section 3.04 hereof, all payments
received and amounts held or realized by the Indenture Trustee (including
any amounts realized by the Indenture Trustee from the exercise of any
remedies pursuant to Section 15 of the Lease or Article IV hereof) after
both an Event of Default shall have occurred and be continuing and the
Equipment Notes shall have become due and payable pursuant to Section
4.04(b) hereof, as well as all payments or amounts then held by the
Indenture Trustee as part of the Trust Indenture Estate, shall be promptly
distributed by the Indenture Trustee in the following order of priority:
First, so much of such payments or amounts as shall be required
to reimburse the Indenture Trustee for any tax, expense 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 (all such
property being herein called the "Mortgaged Property") pursuant to Section
4.05(b) hereof) incurred by the Indenture Trustee (to the extent not
previously reimbursed), 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 or the Note Holders in the protection, exercise or
enforcement of any right, power or remedy or any damages sustained by the
Indenture Trustee or any Note Holder, liquidated or otherwise, upon such
Event of Default shall be applied by the Indenture Trustee as between
itself and the Note Holders in reimbursement of such expenses and any other
expenses for which the Indenture Trustee or the Note Holders are entitled
to reimbursement under any Operative Document and all amounts payable to
the other Indenture Indemnitees hereunder and under the Participation
Agreement and the Lease excluding those amounts described in clauses Second
and Third below, and in the case the aggregate amount to be so distributed
is insufficient to pay as aforesaid, then ratably, without priority of one
over the other, in proportion to the amounts owed each hereunder;
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 such then existing or prior Note
Holders ratably, without priority of one over the 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 hereof;
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 thereon and all other Secured Obligations in respect of the
Series A Equipment Notes 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 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 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 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; and (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 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 plus the accrued but unpaid interest and other amounts due
hereunder or thereunder 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
Fourth, the balance, if any, of such payments or amounts
remaining thereafter shall be distributed to the Owner Trustee free and
clear of the Lien of this Indenture.
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 no
provision as to the application thereof is made in this Trust Indenture and
for which such provision is made in the Lease, the Participation Agreement
or any other Operative Document shall be applied forthwith to the purpose
for which such payment was made in accordance with the terms of the Lease,
the Participation Agreement or such other Operative Document, as the case
may be.
(b) The Indenture Trustee will distribute promptly upon receipt
any indemnity payment received by it from the Owner Trustee or Lessee in
respect of (i) the Indenture Trustee in its individual capacity or any
other Indenture Indemnitees, (ii) any Note Holder, (iii) the Subordination
Agent, (iv) the Liquidity Provider, and (v) the Pass Through Trustees, in
each case whether pursuant to Section 6 of the Participation Agreement or
as Supplemental Rent, directly to the Person entitled thereto. Any payment
received by the Indenture Trustee under the third paragraph of Section 2.02
shall be distributed to the Subordination Agent to be distributed in
accordance with the terms of the Intercreditor Agreement.
(c) Notwithstanding anything to the contrary contained in this
Article III, any amounts received by the Indenture Trustee which constitute
Excluded Payments shall be distributed promptly upon receipt by the
Indenture Trustee directly to the Person or Persons entitled thereto.
(d) Notwithstanding any provision of this Trust Indenture to the
contrary, any amounts held by the Indenture Trustee that would, but for the
provisions of Section 3.03 hereof, otherwise be distributed to Lessee
shall, notwithstanding the provisions of said Section, be distributed to
Lessee unless and until a Lease Event of Default shall have occurred and be
continuing.
SECTION 3.05. Other Payments.
Any payments received by the Indenture Trustee for which no
provision as to the application thereof is made in the Lease, the
Participation Agreement, elsewhere in this Trust Indenture or in any other
Operative Document shall be distributed by the Indenture Trustee to the
extent received or realized at any time (i) prior to the payment in full of
all Secured Obligations due the Note Holders, in the order of priority
specified in Section 3.01 hereof subject to the proviso thereto, and (ii)
after payment in full of all Secured Obligations due the Note Holders, 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.
Further, and except as otherwise provided in Sections 3.02, 3.03 and 3.04
hereof, all payments received and amounts realized by the Indenture Trustee
under the Lease or otherwise with respect to the Aircraft (including,
without limitation, all amounts realized upon the sale or release of the
Aircraft after the termination of the Lease with respect thereto), to the
extent received or realized at any time after payment in full of all
Secured Obligations due the Note Holders, shall be distributed by the
Indenture Trustee in the order of priority specified in clause (ii) of the
immediately preceding sentence of this Section 3.05.
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 (within the time limits
contemplated by Section 2.04(a)) 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 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 (within the time limits contemplated by Section
2.04(a)) specified in Schedule I to the Participation Agreement.
ARTICLE IV
COVENANTS OF OWNER TRUSTEE; EVENTS OF
DEFAULT; REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Covenants of Owner Trustee.
The Owner Trustee hereby covenants and agrees as follows:
(a) 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 Trust Indenture and all amounts, if any, payable
by it to the Note Holders under the Participation Agreement;
(b) [Reserved]
(c) in the event the Owner Trustee shall have Actual Knowledge
of an Event of Default, a Default or an Event of Loss, the Owner Trustee
will give prompt written notice of such Event of Default, Default or Event
of Loss to the Indenture Trustee, each Note Holder, Lessee and the Owner
Participant;
(d) the Owner Trustee will furnish to the Indenture Trustee,
promptly upon receipt thereof, duplicates or copies of all reports,
notices, requests, demands, certificates and other instruments furnished to
the Owner Trustee under the Lease, including, without limitation, a copy of
any Termination Notice received pursuant to Section 9(a) of the Lease, a
copy of each notice delivered pursuant to Section 10, 19 or 20 of the Lease
and a copy of each report or notice received pursuant to Section 11(c) of
the Lease to the extent that the same shall not be required to have been
furnished to the Indenture Trustee pursuant to the Lease;
(e) except pursuant to the Operative Documents or with the
consent of the Indenture Trustee (acting pursuant to instructions given in
accordance with Section 9.01 hereof), the Owner Trustee will not contract
for, create, incur, assume or suffer to exist any Debt, and will not
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability
of so doing, or otherwise), endorse or otherwise be or become contingently
liable, directly or indirectly, in connection with the Debt of any other
person; and
(f) the Owner Trustee will not enter into any business or other
activity other than the business of owning the Aircraft, the leasing
thereof to Lessee and the carrying out of the transactions contemplated
hereby and by the Lease, the Participation Agreement, the Trust Agreement
and the other Operative Documents.
SECTION 4.02. Event of Default.
"Event of Default" means any of the following events (whatever
the reason for such 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 (provided that any such Lease
Event of Default caused solely by a failure of Lessee to pay to the Owner
Trustee or the Owner Participant when due any amount that is included in
the definition of Excluded Payments shall not constitute an Event of
Default unless notice is given by the Owner Trustee to the Indenture
Trustee that such failure shall constitute an Event of Default); or
(b) the failure of the Owner Trustee to pay when due any payment
of Principal Amount of, interest on, Make-Whole Amount, if any, or other
amount due and payable under any Equipment Note or hereunder (other than
any such failure arising as a result of a Lease Event of Default or a Lease
Default) and such failure shall have continued unremedied for ten (10)
Business Days in the case of any payment of Principal Amount or interest or
Make-Whole Amount, if any, thereon and, in the case of any other amount,
for ten (10) Business Days after the Owner Trustee or the Owner Participant
receives written demand from the Indenture Trustee or any Note Holder; or
(c) any Lien required to be discharged by the Owner Trustee in
its individual or trust capacity pursuant to Section 7(f) of the
Participation Agreement, or by the Owner Participant pursuant to Section
7(f) of the Participation Agreement shall remain undischarged for a period
of thirty (30) days after the Owner Trustee and the Owner Participant shall
have received written notice from the Indenture Trustee or any Note Holder
of such Lien; or
(d) any representation or warranty made by the Owner Participant
or the Owner Trustee herein, in the Participation Agreement or in any
certificate furnished by the Owner Participant or the Owner Trustee to the
Indenture Trustee or any Note Holder in connection with the transactions
contemplated by the Operative Documents shall prove to have been false or
incorrect when made in any material respect and continues to be material
and adverse to the interests of the Indenture Trustee or the Note Holders;
and if such misrepresentation is capable of being corrected and if such
correction is being sought diligently, such misrepresentation shall not
have been corrected within sixty (60) days (or, without affecting Section
4.02(f) hereof, in the case of the representations made in Section 7(a) of
the Participation Agreement as to the citizenship of the Owner Trustee in
its individual capacity [or of the Owner Participant, respectively,](5) as
soon as is reasonably practicable but in any event within sixty (60) days
following notice thereof from the Indenture Trustee or any Note Holder to
the Owner Trustee or the Owner Participant, as the case may be); or
--------------
(5) Delete for foreign OP.
(e) other than as provided in (c) above or (f) below, any
failure by the Owner Trustee or Owner Participant to observe or perform any
other covenant or obligation of the Owner Trustee or Owner Participant, as
the case may be, for the benefit of the Indenture Trustee or the Note
Holders contained in the Participation Agreement, Section 4.01(a) of the
Trust Agreement, the Equipment Notes or this Trust Indenture which is not
remedied within a period of sixty (60) days after notice thereof has been
given to the Owner Trustee and the Owner Participant; or
(f) if at any time when the Aircraft is registered under the
laws of the United States, the Owner Participant shall not be a Citizen of
the United States, and as the result thereof the registration of the
Aircraft under the Transportation Code, and regulations then applicable
thereunder, shall cease to be effective; provided that no Event of Default
shall be deemed to have occurred under this paragraph (f) unless such
circumstances continue unremedied for more than sixty (60) days after the
Owner Participant has Actual Knowledge of the state of facts that resulted
in such ineffectiveness and of such loss of citizenship; or
(g) at any time either (i) the commencement of an involuntary
case or other proceeding in respect of the Owner Participant, the Owner
Trustee or the Trust Estate under the federal bankruptcy Laws, as now
constituted or hereafter amended, or any other applicable federal or state
bankruptcy, insolvency or other similar Law in the United States or seeking
the appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Owner Participant, the Owner
Trustee or the Trust Estate or for all or substantially all of its
property, or seeking the winding-up or liquidation of its affairs and the
continuation of any such case or other proceeding undismissed and unstayed
for a period of ninety (90) consecutive days; or (ii) the commencement by
the Owner Participant, the Owner Trustee or the Trust Estate of a voluntary
case or proceeding under the federal bankruptcy Laws, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy,
insolvency or other similar Law in the United States, or the consent by the
Owner Participant, the Owner Trustee or the Trust Estate to the appointment
of or taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or other similar official) of the Owner
Participant, the Owner Trustee or the Trust Estate or for all or
substantially all of its property, or the making by the Owner Participant,
the Owner Trustee or the Trust Estate of any assignment for the benefit of
creditors or the Owner Participant or the Owner Trustee shall take any
action to authorize any of the foregoing; provided, however, that an event
referred to in this Section 4.02(g) with respect to the Owner Participant
shall not constitute an Event of Default if within thirty (30) days of the
commencement of the case or proceeding a final non-appealable order,
judgement or decree shall be entered in such case or proceeding by a court
or a trustee, custodian, receiver or liquidator, to the effect that no part
of the Trust Estate (except for the Owner Participant's beneficial interest
therein) and no right, title or interest under the Trust Indenture Estate
shall be included in, or be subject to, any declaration or adjudication of,
or proceedings with respect to, the bankruptcy, insolvency or liquidation
of the Owner Participant referred to in this Section 4.02(g).
SECTION 4.03. Certain Rights.
The Indenture Trustee shall give the Note Holders, the Owner
Trustee and the Owner Participant prompt written notice of any Event of
Default of which the Indenture Trustee has Actual Knowledge and, if any
such Event of Default results from a Lease Event of Default, shall give the
Note Holders, the Owner Trustee and the Owner Participant not less than ten
(10) Business Days prior written notice of the date (the "Enforcement
Date") on or after which the Indenture Trustee may (subject to the notice
provision set forth in Section 4.04(a)) commence and consummate the
exercise of any remedy or remedies described in Section 4.04, 4.05 or 4.06
hereof, or the exercise of any remedy or remedies pursuant to the
provisions of Section 15 of the Lease; provided, however, that in the event
the Indenture Trustee shall have validly terminated the Lease (or, in the
event of a reorganization proceeding involving Lessee instituted under
Chapter 11 of the Bankruptcy Code, such Lease is rejected), the Indenture
Trustee shall not, without the consent of the Owner Participant, sell or
lease, or otherwise afford the use of, the Aircraft or any portion thereof
to Lessee or any Affiliate thereof. Without limiting the generality of the
foregoing, the Indenture Trustee shall give the Owner Trustee, the Owner
Participant and Lessee at least ten (10) Business Days prior written notice
(which may be given concurrently with notice of the Enforcement Date) of
any declaration of the Lease to be in default pursuant to Sections 14 and
15 of the Lease or any termination of the Lease. If an Event of Default
shall have occurred and be continuing, the Owner Trustee shall have the
following rights hereunder, any of which may be exercised directly by the
Owner Participant.
If as a result of the occurrence of an Event of Default in
respect of the nonpayment by Lessee of Basic Rent due under the Lease, the
Indenture Trustee shall have insufficient funds to make any payment of
Principal Amount and interest on any Equipment Note on the day it becomes
due and payable, the Owner Trustee or the Owner Participant may, but shall
not be obligated to, pay the Indenture Trustee prior to the Enforcement
Date, in the manner provided in Section 2.04 hereof, for application in
accordance with Section 3.01 hereof, an amount equal to the portion of the
Principal Amount and interest (including interest, if any, on any overdue
payments of such portion of Principal Amount and interest) then due and
payable on the Equipment Notes, and, unless the Owner Trustee has cured
Events of Default in respect of payments of Basic Rent on each of the three
(3) immediately preceding Basic Rent payment dates, or the Owner Trustee
has cured six (6) previous Events of Default in respect of payments of
Basic Rent, such payment by the Owner Trustee shall, solely for purposes of
this Trust Indenture, be deemed to cure any Event of Default which would
otherwise have arisen on account of the nonpayment by Lessee of such
installment of Basic Rent (but not any other Default or Event of Default
which shall have occurred and be continuing).
If any Event of Default (other than in respect of the nonpayment
of Basic Rent by Lessee) which can be cured by the payment of money has
occurred, the Owner Trustee or the Owner Participant may, but shall not be
obligated to, cure such Event of Default by making such payment prior to
the Enforcement Date as is necessary to accomplish the observance or
performance of the defaulted covenant, condition or agreement.
Except as hereinafter in this Section 4.03 provided, the Owner
Trustee shall not, as a result of exercising the right to cure any such
Event of Default, obtain any Lien on any of the Mortgaged Property or any
Rent payable under the Lease for or on account of costs or expenses
incurred in connection with the exercise of such right, nor shall any claim
of the Owner Trustee against Lessee or any other party for the repayment of
such costs or expenses impair the prior right and security interest of the
Indenture Trustee in and to the Mortgaged Property. Upon any payment by
the Owner Trustee or the Owner Participant pursuant to the first or second
preceding paragraphs of this Section 4.03, the Owner Trustee or the Owner
Participant, as the case may be, shall be subrogated to the rights of the
Indenture Trustee and the Note Holders in respect of the Basic Rent which
was overdue at the time of such payment and interest payable by Lessee on
account of its being overdue and any Supplemental Rent in respect of the
reimbursement of amounts paid by Owner Trustee pursuant to the immediately
preceding paragraph (but in either case shall have no rights as a secured
party hereunder), and thereafter, the Owner Trustee or the Owner
Participant, as the case may be, shall be entitled to receive such overdue
Basic Rent or Supplemental Rent, as the case may be, and interest thereon
upon receipt thereof by the Indenture Trustee (and shall be entitled to
bring an action against Lessee to enforce such payment); provided, however,
that (i) if the Principal Amount and interest on the Equipment Notes shall
have become due and payable pursuant to Section 4.04(b) hereof (and such
acceleration shall not have been rescinded pursuant to Section 4.04(b)),
such subrogation shall, until the Principal Amount of, interest on, Make-
Whole Amount, if any, and all other amounts due with respect to all
Equipment Notes shall have been paid in full, be subordinate to the rights
of the Indenture Trustee, the Indenture Indemnitees and the Note Holders in
respect of such payment of overdue Basic Rent, Supplemental Rent and such
interest and (ii) the Owner Trustee shall not be entitled to seek to
recover any such payment (or any payment in lieu thereof) except pursuant
to the foregoing right of subrogation by demand or suit for damages.
SECTION 4.04. Remedies.
(a) Subject to the provisions of Section 2.14 hereof, if an
Event of Default shall have occurred and be continuing and so long as the
same shall continue unremedied, then and in every such case the Indenture
Trustee may, subject to the second paragraph of this Section 4.04(a), on
and after the Enforcement Date if such Event of Default results from a
Lease Event of Default, 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 Event of Default
is also a Lease Event of Default, any and all of the remedies pursuant to
Section 15 of the Lease and may take possession of all or any part of the
properties covered or intended to be covered by the Lien created hereby or
pursuant hereto and may exclude the Owner Participant, the Owner Trustee
and Lessee and all persons claiming under any of them wholly or partly
therefrom, provided, that (x) in the case of a sale of the Aircraft, the
Indenture Trustee shall give the Owner Trustee and the Owner Participant,
subsequent to the earlier of (I) the expiration of the Section 1110 Period
(as hereinafter defined) and (II) Lessee's rejection of the Lease in a
proceeding instituted under Chapter 11 of the Bankruptcy Code, twenty (20)
days prior written notice of its intention to sell the Aircraft and (y) in
the case of any judicial proceeding to foreclose the Lien of the Indenture,
fifteen (15) days prior written notice of its intention to initiate such
proceeding and, provided, further, that in the event the Indenture Trustee
shall have validly terminated the Lease (or, in the event of a
reorganization proceeding involving Lessee instituted under Chapter 11 of
the Bankruptcy Code, such Lease is rejected), the Indenture Trustee shall
not, without the consent of the Owner Participant, sell or lease, or
otherwise afford the use of, the Aircraft or any portion thereof to Lessee
or any affiliate thereof. Unless an Event of Default not resulting from or
relating to a Lease Event of Default has occurred and is continuing, the
Owner Participant may bid at any public sale and become the purchaser.
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 Trust Indenture to the contrary
notwithstanding, the Indenture Trustee shall not be entitled to exercise
any remedy hereunder as a result of an Event of Default which arises solely
by reason of one or more events or circumstances which constitute a Lease
Event of Default unless the Indenture Trustee as security assignee of the
Owner Trustee shall have (i) accelerated the maturity of the Equipment
Notes and (ii) exercised or concurrently be exercising one or more of the
remedies provided for in Section 15 of the Lease to terminate the Lease (in
the event that it is not commercially reasonable to take possession of the
Aircraft) 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 sixty (60) days subsequent
to the entry of an order for relief 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"), involuntarily 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 Lessee
continues to perform as required by Section 1110(a)(1)(A-B) 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 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.
In the event that the applicability of Section 1110 of the Bankruptcy Code
to the Aircraft is being contested by Lessee in judicial proceedings, both
the Indenture Trustee and the Owner Trustee shall have the right to
participate in such proceedings.
It is expressly understood and agreed that, subject only to
the immediately preceding paragraph, the inability, described in such
paragraph, of the Indenture Trustee to exercise any right or remedy under
the Lease shall in no event and under no circumstances prevent the
Indenture Trustee from exercising any or all of its rights, powers and
remedies under this Trust Indenture, including, without limitation, this
Article IV.
(b) If an Event of Default 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
delivery of written notice or notices to the Owner Trustee and the Owner
Participant, declare all the 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 (without
Make-Whole Amount) and other amounts due thereunder, shall immediately
become due and payable without presentment, demand, protest or notice, all
of which are hereby waived; provided that if an Event of Default referred
to in clause (g) of Section 4.02 hereof shall have occurred and be
continuing or a Lease Event of Default under Section 14(e) of the Lease
shall have occurred and be continuing, then and in every such case the
unpaid Principal Amount 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;
provided further that in the event of a reorganization proceeding involving
Lessee instituted under Chapter 11 of the Bankruptcy Code, if no other
Lease Event of Default and no other Event of Default (other than the
failure to pay the Principal Amount of the Equipment Notes which by such
declaration have become payable) exists at any time after the consummation
of such proceeding, such declaration shall be automatically rescinded
without any further action on the part of any Note Holder.
This Section 4.04(b), however, is 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
Equipment Notes which by such declaration shall have become payable) shall
have been duly paid, and every other Default and Event of Default with
respect to any covenant or provision of this Trust 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 Default or Event of Default or impair
any right consequent thereon.
Any acceleration pursuant to this Section 4.04(b) shall be
automatically rescinded and any related declaration of an Event of Default
annulled in the event that the Owner Trustee shall have cured, in
accordance with Section 4.03 hereof, the Event of Default that resulted in
such acceleration or declaration.
(c) Any Note Holder shall be entitled, at any sale pursuant to
Section 15 of the Lease or this Section 4.04, to credit against any
purchase price bid at such sale by such holder all or any part of the
unpaid obligations owing to such Note Holder and secured by the Lien of
this Trust Indenture (but only to the extent that such purchase price would
have been paid to such Note Holder pursuant to Article III hereof if such
purchase price were paid in cash and the foregoing provisions of this
subsection (c) were not given effect).
(d) In the event of any sale of the Trust Indenture Estate, or
any part thereof, pursuant to any judgment or decree of any court or
otherwise in connection with the enforcement of any of the terms of this
Trust Indenture, the unpaid Principal Amount of all Equipment Notes then
outstanding, together with accrued interest thereon, and other amounts due
thereunder, shall immediately become due and payable without presentment,
demand, protest or notice, all of which are hereby waived.
(e) 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 Mortgaged
Property or take any action with respect to any Mortgaged Property so
acquired by it if such acquisition or action would cause any Pass Through
Trust to fail to qualify as a "grantor trust" for federal income tax
purposes.
SECTION 4.05. Return of Aircraft, Etc.
(a) If an Event of Default shall have occurred and be
continuing, subject to Sections 4.03 and 4.04 hereof and unless the Owner
Trustee or the Owner Participant shall have elected to purchase the
Equipment Notes, at the request of the Indenture Trustee, the Owner Trustee
shall promptly execute and deliver to the Indenture Trustee such
instruments 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 Indenture Trustee may specify, to obtain possession of all or
any part of the Mortgaged Property included in the Trust Indenture Estate
to which the Indenture Trustee shall at the time be entitled hereunder. 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 permitted by applicable law,
and (ii) pursue all or part of such Mortgaged Property wherever it may be
found and, in the event that a Lease Event of Default has occurred and is
continuing, may enter any of the premises of Lessee wherever such Mortgaged
Property may be or be supposed to be and search for such Mortgaged Property
and take possession of and remove such Mortgaged Property. 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 Trust Indenture.
(b) Upon every such taking of possession, the Indenture Trustee
may, from time to time, at the expense of the Mortgaged Property, make all
such expenditures for maintenance, use, operation, storage, insurance,
leasing, control, management, disposition, modifications or alterations to
and of the Mortgaged Property, as it may deem proper. In each such case,
the Indenture Trustee shall have the right to maintain, use, operate,
store, insure, lease, control, manage, dispose of, modify or alter the
Mortgaged Property and to carry on the business and to exercise all rights
and powers of the Owner Participant and the Owner Trustee relating to the
Mortgaged Property, as the Indenture Trustee shall deem best, including the
right to enter into any and all such agreements with respect to the
maintenance, use, operation, storage, insurance, leasing, control,
management, disposition, modification or alteration of the Mortgaged
Property 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 Mortgaged Property and every part thereof, except Excluded
Payments, without prejudice, however, to the right of the Indenture Trustee
under any provision of this Trust Indenture to collect and receive all cash
held by, or required to be deposited with, the Indenture Trustee hereunder
other than Excluded Payments. Such tolls, rents (including Rent),
revenues, issues, income, products and profits shall be applied to pay the
expenses of the maintenance, use, operation, storage, insurance, leasing,
control, management, disposition, improvement, modification or alteration
of the Mortgaged Property and of conducting the business thereof, 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 Mortgaged Property 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 which the Indenture Trustee may be required or authorized to make
under any provision of this Trust 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 with respect hereto.
SECTION 4.06. Remedies Cumulative.
Each and every right, power and remedy given to the Indenture
Trustee specifically or otherwise in this Trust 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 Lessee or to be an acquiescence therein.
SECTION 4.07. Discontinuance of Proceedings.
In case the Indenture Trustee shall have instituted any
proceeding to enforce any right, power or remedy under this Trust 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 Trustee, then and in every such case the Owner
Trustee, the Indenture Trustee and Lessee shall, subject to any
determination in such proceedings, be restored to their former positions
and rights hereunder with respect to the Mortgaged Property, and all
rights, remedies and powers of the Owner Trustee, the Indenture Trustee or
Lessee shall continue as if no such proceedings had been instituted.
SECTION 4.08. Waiver of Past Defaults.
Upon written instruction from a Majority in Interest of Note
Holders, and subject to Section 5.02 the Indenture Trustee shall waive any
past Default hereunder and its consequences and upon any such waiver such
Default shall cease to exist and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose of this Trust
Indenture, but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon; provided, that in the
absence of written instructions from all the Note Holders, the Indenture
Trustee shall not waive any Default (i) in the payment of the Principal
Amount, Make-Whole Amount, if any, and interest and other amounts due under
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. Appointment of Receiver.
If an Event of Default shall have occurred and be continuing, the
Indenture Trustee shall, as a matter of right, be entitled to the
appointment of a receiver (who may be the Indenture Trustee or any
successor or nominee thereof) for all or any part of the Mortgaged
Property, whether such receivership be incidental to a proposed sale of the
Mortgaged Property or the taking of possession thereof or otherwise, and
the Owner Trustee hereby consents to the appointment of such a receiver and
will not oppose any such appointment. Any receiver appointed for all or any
part of the Mortgaged Property shall be entitled to exercise all the rights
and powers of the Indenture Trustee with respect to the Mortgaged Property.
SECTION 4.10. Indenture Trustee Authorized to Execute Bills of
Sale, Etc.
The Owner Trustee irrevocably appoints the Indenture Trustee the
true and lawful attorney-in-fact of the Owner Trustee in its name and stead
and on its behalf, for the purpose, if an Event of Default shall have
occurred and be continuing, of effectuating in accordance with applicable
law any sale, assignment, transfer or delivery for the enforcement of the
Lien of this Trust Indenture, whether pursuant to foreclosure or power of
sale, assignments and other instruments as may be necessary or appropriate,
with full power of substitution, the Owner Trustee hereby ratifying and
confirming all that such attorney or any substitute shall do by virtue
hereof in accordance with applicable law. Nevertheless, if so requested by
the Indenture Trustee or any purchaser, the Owner Trustee shall ratify and
confirm any such sale, assignment, transfer or delivery, by executing and
delivering to the Indenture Trustee or such purchaser all bills of sale,
assignments, releases and other proper instruments to effect such
ratification and confirmation as may be designated in any such request.
SECTION 4.11. Rights of Note Holders to Receive Payment.
Notwithstanding any other provision of this Trust Indenture, the
right of any Note Holder to receive payment of principal of, and premium,
if any, and interest on an Equipment Note on or after the respective due
dates expressed in such Equipment Note, or to bring suit for the
enforcement of any such payment on or after such respective dates in
accordance with the terms hereof, shall not be impaired or affected without
the consent of such Note Holder.
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Event of Default.
If the Indenture Trustee shall have Actual Knowledge of an Event
of Default or of a Default arising from a failure to pay Rent, the
Indenture Trustee shall give prompt written notice thereof to the Owner
Trustee, the Owner Participant, Lessee and each Note Holder. Subject to
the terms of Sections 2.14, 4.03, 4.04, 4.08, 5.02 and 5.03 hereof, the
Indenture Trustee shall take such action, or refrain from taking such
action, with respect to such Event of Default or 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, if the
Indenture Trustee shall not have received instructions as above provided
within twenty (20) days after mailing notice of such 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 Event of Default or Default as it shall determine advisable in the
best interests of the Note Holders. If the Indenture Trustee shall at any
time declare the Lease to be in default pursuant to Section 15 thereof or
shall elect to foreclose or otherwise enforce this Trust Indenture, the
Indenture Trustee shall forthwith notify the Owner Participant, the Note
Holders, the Owner Trustee and Lessee. For all purposes of this Trust
Indenture, in the absence of Actual Knowledge on the part of the Indenture
Trustee, the Owner Trustee or the Owner Participant, the Indenture Trustee,
the Owner Trustee or the Owner Participant, as the case may be, shall not
be deemed to have knowledge of a Default or an Event of Default (except, in
the case of the Indenture Trustee, the failure of Lessee to pay any
installment of Basic Rent within one (1) Business Day after the same shall
become due, if any portion of such installment was then required to be paid
to the Indenture Trustee, which failure shall constitute knowledge of a
Default) unless notified in writing by Lessee, the Owner Trustee, the Owner
Participant or one or more Note Holders.
SECTION 5.02. Action upon Instructions; Certain Rights and
Limitations.
(a) Subject to the terms of Sections 2.14, 4.03, 4.04(a) and
(b), 4.08, 5.01 and 5.03 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, subject to the terms of this Section 5.02, take
such of the following actions as may be specified in such instructions: (i)
give such notice or direction or exercise such right, remedy or power
hereunder as shall be specified in such instructions; (ii) give such notice
or direction or exercise such right, remedy or power under the Lease, the
Participation Agreement, the Purchase Agreement, or any other part of the
Trust Indenture Estate as shall be specified in such instructions; and
(iii) after the occurrence and during the continuance of an Event of
Default, approve as satisfactory to the Indenture Trustee all matters
required by the terms of the Lease to be satisfactory to the Owner Trustee,
it being understood that without the written instructions of a Majority in
Interest of Note Holders, the Indenture Trustee shall not approve any such
matter as satisfactory to the Indenture Trustee; provided, that anything
contained in this Trust Indenture, the Lease or the other Operative
Documents to the contrary notwithstanding:
(1) the Owner Trustee or the Owner Participant may,
without the consent of the Indenture Trustee, demand, collect, sue for
or otherwise obtain all amounts included in Excluded Payments from
Lessee, exercise any election or option or make any decision or
determination or to give or receive any notice, consent, waiver or
approval in respect of any Excluded Payment and seek legal or
equitable remedies to require Lessee to maintain the insurance
coverage referred to in Section 11 of the Lease; provided, that the
rights referred to in this clause (1) shall not be deemed to include
the exercise of any remedies provided for in Section 15 of the Lease
other than the right to proceed by appropriate court action, either at
law or in equity, to enforce payment by Lessee of such amounts
included in Excluded Payments or performance by Lessee of such
insurance covenant, or to recover damages for the breach thereof or
for specific performance of any covenant of Lessee;
(2) the Indenture Trustee shall not, without the consent
of the Owner Trustee and the Owner Participant, which consent shall
not be withheld if no right or interest of the Owner Trustee or the
Owner Participant shall be 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 or any other
Operative Document, 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;
(3) whether or not a Default or Event of Default under
the Trust Indenture 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 Lessee 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 or Lessor pursuant to
any Operative Document, (ii) to exercise inspection rights pursuant to
Section 12 of the Lease and (iii) to give notices of default under
Section 14 of the Lease;
(4) whether or not a Default or Event of Default under
the Trust Indenture has occurred and is continuing, the Owner Trustee
shall have the right to the exclusion of the Indenture Trustee to (i)
adjust upwards Rent, EBO Amount and Termination Values as provided in
Section 3(c) of the Lease, (ii) to extend the Term, (iii) to retain
all rights with respect to insurance maintained for its own account
which Section 11(b) of the Lease specifically confers on Lessor or the
Owner Participant, (iv) to exercise, to the extent necessary to enable
it to exercise its rights under Section 4.03 hereof, the rights of
Lessor under Section 22 of the Lease and (v) to select counsel with
respect to any opinion relating to tax matters to be delivered solely
to the Owner Participant;
(5) so long as no Indenture Trustee Event has occurred
and is continuing, the Owner Trustee shall have the right, to the
exclusion of the Indenture Trustee, to adjust EBO Amounts and
Termination Values as provided in Section 3(c) of the Lease or to
adjust downward any installment or amount of Basic Rent, EBO Amount or
Termination Value, as such installments and amounts are set forth in
Exhibits B, C and D, respectively, to the Lease, to the extent of the
portion of such installment or amount that would, under Section 3.01,
3.02 or 3.03 hereof, as the case may be, be distributable to the Owner
Trustee or the Owner Participant;
(6) whether or not a Default or Event of Default under
the Trust Indenture has occurred and is continuing, the Owner Trustee
may, without the consent of the Indenture Trustee, (i) solicit and
make bids with respect to the Aircraft under Section 9 of the Lease in
respect of a termination of the Lease by Lessee pursuant to Section 9
thereof, (ii) determine "fair market sales value" and "fair market
rental value" under Section 19 of the Lease for all purposes except
following an Event of Default pursuant to Section 15 of the Lease, and
(iii) make an election pursuant to and in accordance with the
provisions of Section 9(b) of the Lease; and
(7) so long as no Indenture Trustee Event shall have
occurred and be continuing, except as provided in clauses (2) and (3)
above, all other rights of the "Lessor" under the Lease shall be
exercised by the Owner Trustee to the exclusion of the Indenture
Trustee including, without limitation, the right to (i) exercise all
rights with respect to Lessee's use and operation, modification or
maintenance of the Aircraft and any Engine which the Lease
specifically confers on Lessor, and (ii) consent to and approve any
assignment pursuant to Section 13 of the Lease; provided that the
foregoing shall not (A) limit any rights separately granted to the
Indenture Trustee under the Operative Documents, (B) limit the right
of the Indenture Trustee to receive any funds to be delivered to the
"Lessor" under the Lease (except with respect to Excluded Payments)
and under the Purchase Agreement or confer upon the Owner Trustee the
right to adversely affect the validity or enforceability of the Lien
of this Indenture by depriving the Note Holders or other Indenture
Indemnitees of the benefit thereof or (C) confer on the Owner Trustee
the right to agree to any amendment or supplement to the Lease except
in accordance with Article IX.
Notwithstanding anything to the contrary contained herein, the
Indenture Trustee shall have the right, to the exclusion of the Owner
Trustee and the Owner Participant, to (A) declare the Lease to be in
default under Section 15 thereof and (B) subject only to the provisions of
Sections 4.03, 4.04(a) and (b) and 2.14 hereof, exercise the remedies set
forth in such Section 15 (other than in connection with Excluded Payments)
at any time that a Lease Event of Default shall have occurred and be
continuing.
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 specified by Lessee pursuant to Section 7(d)
of the Participation Agreement or 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 form of such continuation statement so to
be filed). The Indenture Trustee will furnish to each Note Holder (and,
during the continuation of an Indenture Trustee Event, to the Owner Trustee
and Owner Participant), 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, including, without limitation, a copy of any Termination Notice
and a copy of each report or notice received pursuant to Sections 9(a) and
11(c) of the Lease, respectively, to the extent that the same shall not
have been furnished to such Note Holder pursuant hereto or to the Lease.
(b) If any Lease Event of Default shall have occurred and be
continuing and the Owner Trustee shall not have cured fully such Lease
Event of Default under and in accordance with Section 4.03 hereof, on
request of a Majority in Interest of Note Holders, the Indenture Trustee
shall declare the Lease to be in default pursuant to Section 15 thereof and
exercise those remedies specified by such Note Holders. The Indenture
Trustee agrees to provide to the Note Holders, the Owner Trustee, the Owner
Participant and Lessee concurrently with such declaration by the Indenture
Trustee, notice of such declaration by the Indenture Trustee.
SECTION 5.03. Indemnification.
The Indenture Trustee shall not be required to take any action or
refrain from taking any action under Sections 5.01 (other than the first
sentence thereof), 5.02 or Article IV hereof unless the Indenture Trustee
shall have been indemnified to its reasonable satisfaction against any
liability, cost or expense (including counsel fees) which may be incurred
in connection therewith pursuant to a written agreement with one or more
Note Holders. The Indenture Trustee shall not be under any obligation to
take any action under this Trust Indenture and nothing herein or therein
shall require the Indenture Trustee to expend or risk its own funds or
otherwise incur the risk of any financial liability in the performance of
any of its rights or powers if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it (the written indemnity of
any Note Holder who is a QIB, signed by an authorized officer thereof, in
favor of, delivered to and in form reasonably satisfactory to Indenture
Trustee shall be accepted as reasonable assurance of adequate indemnity).
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 Trust Indenture or any other
Operative Document 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 Lease or
is otherwise contrary to Law.
SECTION 5.04. No Duties Except as Specified in Trust Indenture
or Instructions.
The Indenture Trustee shall not have any duty or obligation to
use, operate, store, lease, control, manage, sell, dispose of 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 Trust Indenture or any part of the Trust Indenture Estate,
except as expressly provided by the terms of this Trust Indenture or as
expressly provided in written instructions from Note Holders as provided in
this Trust Indenture; and no implied duties or obligations shall be read
into this Trust Indenture against the Indenture Trustee. 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 Section 7.01 hereof), promptly take such action as may be
necessary duly to discharge all liens and encumbrances on any part of the
Trust Indenture Estate which result from claims against it in its
individual capacity not related to the ownership of the Aircraft or the
administration of the Trust Indenture Estate or any other transaction
pursuant to this Trust Indenture or any document included in the Trust
Indenture Estate.
SECTION 5.05. No Action Except Under Lease, Trust 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 the Aircraft or any other part of the Trust Indenture
Estate except (i) as required by the terms of the Lease or (ii) in
accordance with the powers granted to, or the authority conferred upon, the
Owner Trustee and the Indenture Trustee pursuant to this Trust Indenture
and in accordance with the express terms hereof.
SECTION 5.06. Replacement Airframes and Replacement Engines.
At any time an Airframe or Engine is to be replaced under or
pursuant to Section 10 of the Lease by a Replacement Airframe or
Replacement Engine, if no Lease Event of Default is continuing, the Owner
Trustee shall direct the Indenture Trustee to execute and deliver to the
Owner Trustee an appropriate instrument releasing such Airframe and/or
Engine as appropriate from the Lien of this Trust Indenture and the
Indenture Trustee shall execute and deliver such instrument as aforesaid,
but only upon compliance by Lessee with the applicable provisions of
Section 10 of the Lease and upon receipt by the Indenture Trustee of a
written request from the Owner Trustee, requesting such release and
specifically describing the Airframe and/or Engine(s) so to be released.
SECTION 5.07. Indenture Supplements for Replacements.
If a Replacement Airframe or Replacement Engine is being
substituted as contemplated by Section 10 of the Lease, the Owner Trustee
and the Indenture Trustee agree for the benefit of the Note Holders and
Lessee, subject to fulfillment of the conditions precedent and compliance
by Lessee with its obligations set forth in Section 10 of the Lease and the
requirements of Section 5.06 hereof with respect to such Replacement
Airframe or Replacement Engine, to execute and deliver a Lease Supplement
and a Trust Agreement and Indenture Supplement, as applicable, as
contemplated by Section 10 of the Lease.
SECTION 5.08. Effect of Replacement.
In the event of the substitution of an Airframe or of a
Replacement Engine pursuant to Section 10 of the Lease, (a) all provisions
of this Trust Indenture relating to the Airframe or Engine or Engines being
replaced shall be applicable to such Replacement Airframe or Replacement
Engine or Engines with the same force and effect as if such Replacement
Airframe or Replacement Engine or Engines were the same airframe or engine
or engines, as the case may be, as the Airframe or Engine or Engines being
replaced but for the Event of Loss with respect to the Airframe or Engine
or Engines being replaced, and (b) the provisions of this Trust Indenture
shall no longer be applicable to the Airframe or Engine or Engines being
replaced, which shall be released from the Lien of this Indenture.
SECTION 5.09. Investment of Amounts Held by Indenture Trustee.
Any amounts held by the Indenture Trustee as assignee of the
Owner Trustee's rights to hold monies for security pursuant to Section 21
of the Lease shall be held in accordance with the terms of such Section and
the Indenture Trustee agrees, for the benefit of Lessee, to perform the
duties of the Owner Trustee under such Section. Any amounts held by the
Indenture Trustee pursuant to the proviso to the first sentence of Section
3.01, pursuant to Section 3.02, 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 Cash Equivalents as directed by Lessee so long as the Indenture
Trustee may acquire the same using its best efforts. Unless otherwise
expressly provided in this Trust Indenture, any income realized as a result
of any such investment, 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 Trust 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 such sale is necessary to
make a distribution required by this Trust Indenture.
ARTICLE VI
THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties.
The Indenture Trustee accepts the duties hereby created and
applicable to it and agrees to perform the same but only upon the terms of
this Trust Indenture and agrees to receive and disburse all monies
constituting part of the Trust Indenture Estate in accordance with the
terms hereof. The Owner Trustee, in its individual capacity, and the
Indenture Trustee, in its individual capacity, shall not be answerable or
accountable under any circumstances, except (i) for their own willful
misconduct or gross negligence (other than for the handling of funds, for
which the standard of accountability shall be willful misconduct or
negligence), (ii) in the case of the Indenture Trustee, as provided in the
fourth sentence of Section 2.04(a) hereof and the last sentence of Section
5.04 hereof, and (iii) for liabilities that may result, in the case of the
Owner Trustee, from the inaccuracy of any representation or warranty of the
Owner Trustee expressly made in its individual capacity in the
Participation Agreement or in Section 6.03 hereof (or in any certificate
furnished to the Indenture Trustee or any Note Holder in connection with
the transactions contemplated by the Operative Documents) or, in the case
of the Indenture Trustee (in its individual capacity), from the inaccuracy
of any representation or warranty of the Indenture Trustee (in its
individual capacity) in the Participation Agreement or expressly made
hereunder. Neither the Owner Trustee nor the Indenture Trustee shall be
liable for any action or inaction of the other or of the Owner Participant.
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 or 5.02 hereof, and
except as provided in, and without limiting the generality of, Sections
5.03 and 5.04 hereof and, in the case of the Owner Trustee, 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 Trust 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 or to effect or maintain any such insurance, whether or not
Lessee shall be in default with respect thereto, (iii) to see to the
payment or discharge of any lien or encumbrance 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 from
Lessee, or (v) to inspect the Aircraft at any time or ascertain or inquire
as to the performance or observance of any of Lessee's covenants under the
Lease with respect to the Aircraft. The Owner Participant shall not have
any duty or responsibility hereunder, including, without limitation, any of
the duties mentioned in clauses (i) through (v) above; provided, that
nothing contained in this sentence shall limit any obligations of the Owner
Participant under the Participation Agreement or relieve the Owner
Participant from any restriction under Section 4.03 hereof.
SECTION 6.03. No Representations or Warranties as to Aircraft
or Documents.
NEITHER THE INDENTURE TRUSTEE IN ITS INDIVIDUAL OR TRUST CAPACITY
NOR THE OWNER TRUSTEE IN ITS INDIVIDUAL CAPACITY OR AS OWNER TRUSTEE UNDER
THE TRUST AGREEMENT, NOR THE OWNER PARTICIPANT 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,
COMPLIANCE WITH SPECIFICATIONS, CONDITION, DESIGN, QUALITY, DURABILITY,
OPERATION, MERCHANTABILITY OR FITNESS FOR USE FOR A PARTICULAR PURPOSE OF
THE AIRCRAFT OR ANY ENGINE, 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
WHATSOEVER, except the Owner Trustee in its individual capacity warrants
that (i) the Owner Trustee has received on the Delivery Date whatever title
was conveyed to it by Lessee, and (ii) the Aircraft is free and clear of
Lessor Liens attributable to the Owner Trustee in its individual capacity.
Neither the Owner Trustee, in its individual capacity or as Owner Trustee
under the Trust Agreement, nor the Indenture Trustee, in its individual or
trust capacities, makes or shall be deemed to have made any representation
or warranty as to the validity, legality or enforceability of this Trust
Indenture, the Trust Agreement, the Participation Agreement, the Equipment
Notes, the Lease, the Purchase Agreement, the Purchase Agreement
Assignment, or the Consent and Agreement, or as to the correctness of any
statement contained in any thereof, except for the representations and
warranties of the Owner Trustee made in its individual capacity and the
representations and warranties of the Indenture Trustee, in each case
expressly made in this Trust Indenture or in the Participation Agreement.
The Loan Participants, the Note Holders and the Owner Participant make no
representation or warranty hereunder whatsoever.
SECTION 6.04. No Segregation of Monies; No Interest.
Any monies paid to or retained by the Indenture Trustee pursuant
to any provision hereof and not then required to be distributed to the Note
Holders, 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 or as
specifically provided in the Lease and Section 5.09 hereof, and may be
deposited under such general conditions as may be prescribed by Law, and
the Indenture Trustee shall not be liable for any interest thereon (except
that the Indenture Trustee shall invest all monies held as directed by
Lessee so long as no Lease Event of Default has occurred and is continuing
(or in the absence of such direction, by the Majority In Interest of Note
Holders)) in Cash Equivalents; provided, however, 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; Agreements; 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 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 (or, in the case of the Owner Participant which originally
executed the Participation Agreement, evidence of the approval by the
Executive Committee thereof) of any party to the Participation 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 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 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. 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 Trust 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 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 advice or 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 as herein and
in the Trust Agreement provided, and not in its individual capacity, except
as otherwise expressly provided herein, in the Trust Agreement and in the
Participation Agreement.
SECTION 6.07. Compensation.
The Indenture Trustee shall be entitled to reasonable
compensation, including expenses and disbursements (including the
reasonable fees and expenses of counsel), for all services rendered
hereunder and shall, on and subsequent to an Event of Default hereunder,
have a priority claim on the Trust Indenture Estate for the payment of such
compensation, to the extent that such compensation shall not be paid by
Lessee, and shall have the right, on and subsequent to an Event of Default
hereunder, to use or apply any monies held by it hereunder in the Trust
Indenture Estate toward such payments. The Indenture Trustee agrees that
it shall have no right against the Loan Participants, the Note Holders, the
Owner Trustee or the Owner Participant for any fee as compensation for its
services as trustee under this Trust Indenture.
SECTION 6.08. Instructions from Note Holders.
In the administration of the trusts created hereunder, the
Indenture Trustee shall have the right to seek instructions from a Majority
in Interest of Note Holders should any provision of this Trust Indenture
appear to conflict with any other provision herein or should the Indenture
Trustee's duties or obligations hereunder be unclear, and the Indenture
Trustee shall incur no liability in refraining from acting until it
receives such instructions. The Indenture Trustee shall be fully protected
for acting in accordance with any instructions received under this Section
6.08.
ARTICLE VII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER TRUSTEE
SECTION 7.01. Scope of Indemnification.
The Owner Trustee, not in its individual capacity, but solely as
Owner Trustee, hereby agrees, except as otherwise provided in Section 2.03
or 2.04(b) hereof, to assume liability for, and does hereby indemnify,
protect, save and keep harmless the Indenture Trustee (in its individual
and trust capacities), and its successors, assigns, agents and servants,
from 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 Trust Indenture), claims, actions, suits, 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 (whether or not also indemnified
against by any other Person under any other document) in any way relating
to or arising out of this Trust Indenture or any other Operative Document
to which it is a party 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, non-acceptance, rejection, ownership, delivery,
lease, possession, use, operation, condition, sale, return or other
disposition of the Aircraft or any Engine (including, without limitation,
latent or 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, to the extent not
reimbursed by Lessee. Notwithstanding any provision to the contrary
herein, the scope of the Owner Trustee's indemnity obligations under this
Section 7.01 shall not exceed the scope of the indemnity obligations of
Lessee under the Participation Agreement and the Lease; and the Indenture
Trustee agrees that, prior to seeking indemnification from the Trust
Indenture Estate, it will demand, and take such action as it may determine
to be reasonable to pursue, indemnification available to the Indenture
Trustee under the Lease or the Participation Agreement. Notwithstanding
the foregoing, the Indenture Trustee shall not be entitled to any
indemnification for any Expenses to the extent relating to or arising from
the willful misconduct or gross negligence (or negligence in the case of
handling funds) of the Indenture Trustee in the performance of its duties
hereunder or resulting from the inaccuracy of any representation or
warranty of the Indenture Trustee (in its individual capacity) referred to
in Section 6.03 hereof, or as provided in Section 6.01 hereof or in the
last sentence of Section 5.04 hereof, or as otherwise excluded by the terms
of Sections 6(b) and 6(c) of the Participation Agreement from Lessee's
indemnities under such Sections. In addition, if necessary, 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 Lessee or others, but without
releasing any of them from their respective agreements of reimbursement;
and to secure the same the Indenture Trustee shall have a prior Lien on the
Trust Indenture Estate. The Owner Trustee shall be subrogated to the
Indenture Trustee's rights, if any, to payment from Lessee for amounts paid
by the Owner Trustee under this Section 7.01.
ARTICLE VIII
SUCCESSOR 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 including upon any merger,
conversion, consolidation or sale of substantially all of the corporate
trust business of the Owner Trustee pursuant to the Trust Agreement, the
successor Owner Trustee shall give prompt written notice thereof to the
Indenture Trustee, Lessee and the Note Holders.
SECTION 8.02. Resignation 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 days prior written notice to
Lessee, the Owner Trustee, the Owner Participant and each Note Holder, 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 (but only with the consent of Lessee, which consent
shall not be unreasonably withheld, except that such consent shall not be
necessary if a Lease Event of Default shall have occurred and be
continuing) remove the Indenture Trustee without cause by an instrument in
writing delivered to the Owner Trustee, Lessee, the Owner Participant 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 Indenture Trustee, a Majority in
Interest of Note Holders may appoint a successor Indenture Trustee by an
instrument signed by such holders, which successor, so long as no Lease
Event of Default shall have occurred and be continuing, shall be subject to
Lessee's reasonable approval. If a successor Indenture Trustee shall not
have been appointed within 30 days after such notice of resignation or
removal, the Indenture Trustee, the Owner Trustee, the Owner Participant or
any Note Holder 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.
(b) Any successor Indenture Trustee, however appointed, shall
execute and deliver to the Owner Trustee, the predecessor Indenture Trustee
and Lessee an instrument accepting such appointment and assuming the
obligations of the Indenture Trustee under the Participation Agreement
arising from and after the time of such appointment, and thereupon such
successor Indenture Trustee, without further act, shall become vested with
all the estates, properties, rights, powers and duties of the predecessor
Indenture Trustee hereunder in the trust 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 monies or other property then held by such
predecessor Indenture Trustee hereunder.
(c) Any successor Indenture Trustee, however appointed, shall be
a bank or trust company having its principal place of business in the
United States and having (or whose obligations under the Operative
Documents are guaranteed by an affiliated entity having) a combined capital
and surplus of at least $100,000,000, 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, 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 a successor Indenture Trustee and the Indenture Trustee
under this Trust Indenture without further act.
SECTION 8.03. Appointment of Additional and Separate Trustees.
(a) Whenever (i) the Indenture Trustee shall deem it necessary
or desirable in order to conform to any law of any jurisdiction in which
all or any part of the Trust Indenture Estate shall be situated or to make
any claim or bring any suit with respect to or in connection with the Trust
Indenture Estate, this Trust Indenture, any other Indenture Agreement, the
Equipment Notes or any of the transactions contemplated by the
Participation Agreement, (ii) the Indenture Trustee shall be advised by
counsel satisfactory to it that it is so necessary or prudent in the
interests of the Note Holders (and the Indenture Trustee shall so advise
the Owner Trustee and Lessee), or (iii) the Indenture Trustee shall have
been requested to do so by a Majority in Interest of Note Holders, then in
any such case, the Indenture Trustee and, upon the written request of the
Indenture Trustee, the Owner Trustee, shall execute and deliver an
indenture supplemental hereto and such other instruments as may from time
to time be necessary or advisable either (1) to constitute one or more bank
or trust companies or one or more persons approved by the Indenture
Trustee, either to act jointly with the Indenture Trustee as additional
trustee or trustees of all or any part of the Trust Indenture Estate, or to
act as separate trustee or trustees of all or any part of the Trust
Indenture Estate, in each case with such rights, powers, duties and
obligations consistent with this Trust Indenture as may be provided in such
supplemental indenture or other instruments as the Indenture Trustee or a
Majority in Interest of Note Holders may deem necessary or advisable, or
(2) to clarify, add to or subtract from the rights, powers, duties and
obligations theretofore granted any such additional and separate trustee,
subject in each case to the remaining provisions of this Section 8.03. If
the Owner Trustee shall not have taken any action requested of it under
this Section 8.03(a) that is permitted or required by its terms within 15
days after the receipt of a written request from the Indenture Trustee so
to do, or if an Event of Default shall have occurred and be continuing, the
Indenture Trustee may act under the foregoing provisions of this Section
8.03(a) without the concurrence of the Owner Trustee; and the Owner Trustee
hereby irrevocably appoints (which appointment is coupled with an interest)
the Indenture Trustee, its agent and attorney-in-fact to act for it under
the foregoing provisions of this Section 8.03(a) in either of such
contingencies. The Indenture Trustee may, in such capacity, execute,
deliver and perform any such supplemental indenture, or any such
instrument, as may be required for the appointment of any such additional
or separate trustee or for the clarification of, addition to or subtraction
from the rights, powers, duties or obligations theretofore granted to any
such additional or separate trustee. In case any additional or separate
trustee appointed under this Section 8.03(a) shall die, become incapable of
acting, resign or be removed, all the assets, property, rights, powers,
trusts, duties and obligations of such additional or separate trustee shall
revert to the Indenture Trustee until a successor additional or separate
trustee is appointed as provided in this Section 8.03(a).
(b) No additional or separate trustee shall be entitled to
exercise any of the rights, powers, duties and obligations conferred upon
the Indenture Trustee in respect of the custody, investment and payment of
monies and all monies received by any such additional or separate trustee
from or constituting part of the Trust Indenture Estate or otherwise
payable under any Operative Document to the Indenture Trustee shall be
promptly paid over by it to the Indenture Trustee. All other rights,
powers, duties and obligations conferred or imposed upon any additional or
separate trustee shall be exercised or performed by the Indenture Trustee
and such additional or separate trustee jointly except to the extent that
applicable Law of any jurisdiction in which any particular act is to be
performed renders the Indenture Trustee incompetent or unqualified to
perform such act, in which event such rights, powers, duties and
obligations (including the holding of title to all or part of the Trust
Indenture Estate in any such jurisdiction) shall be exercised and performed
by such additional or separate trustee. No additional or separate trustee
shall take any discretionary action except on the instructions of the
Indenture Trustee or a Majority in Interest of Note Holders. No trustee
hereunder shall be personally liable by reason of any act or omission of
any other trustee hereunder, except that the Indenture Trustee shall be
liable for the consequences of its lack of reasonable care in selecting,
and Indenture Trustee's own actions in acting with, any additional or
separate trustee. Each additional or separate trustee appointed pursuant
to this Section 8.03 shall be subject to, and shall have the benefit of
Articles IV through VIII and Article X hereof insofar as they apply to the
Indenture Trustee. The powers of any additional or separate trustee
appointed pursuant to this Section 8.03 shall not in any case exceed those
of the Indenture Trustee hereunder.
(c) If at any time the Indenture Trustee shall deem it no longer
necessary or desirable in order to conform to any such law or take any such
action or shall be advised by such counsel that it is no longer so
necessary or desirable in the interest of the Note Holders, or in the event
that the Indenture Trustee shall have been requested to do so in writing by
a Majority in Interest of Note Holders, the Indenture Trustee and, upon the
written request of the Indenture Trustee, the Owner Trustee, shall execute
and deliver an indenture supplemental hereto and all other instruments and
agreements necessary or proper to remove any additional or separate
trustee. The Indenture Trustee may act on behalf of the Owner Trustee
under this Section 8.03(c) when and to the extent it could so act under
Section 8.03(a) hereof.
ARTICLE IX
SUPPLEMENTS AND AMENDMENTS TO THIS TRUST INDENTURE
AND OTHER DOCUMENTS
SECTION 9.01. Instructions of Majority; Limitations.
(a) Except as expressly provided in Section 5.02 hereof, and
except with respect to Excluded Payments, the Owner Trustee agrees it shall
not enter into any amendment of or supplement to the Lease, the Purchase
Agreement (to the extent assigned in the Purchase Agreement Assignment),
the Purchase Agreement Assignment, the Consent and Agreement, or execute
and deliver any written waiver or modification of, or consent under, the
terms of the Lease, the Purchase Agreement (to the extent assigned in the
Purchase Agreement Assignment), the Purchase Agreement Assignment, the
Consent and Agreement, unless such supplement, amendment, waiver,
modification or consent is consented to in writing by the Indenture Trustee
and a Majority in Interest of Note Holders. Anything to the contrary
contained herein notwithstanding, without the necessity of the consent of
any of the Note Holders or the Indenture Trustee, (i) any Excluded Payments
payable to the Owner Participant may be modified, amended, changed or
waived in such manner as shall be agreed to by the Owner Participant and
Lessee and (ii) the Owner Trustee and Lessee may enter into amendments of
or additions to the Lease to modify Section 5 (except to the extent that
such amendment would affect the rights or exercise of remedies under
Section 15 of the Lease), Section 9, Section 19 or Section 20 of the Lease
so long as such amendments, modifications and changes do not and would not
affect the time of, or reduce the amount of, Rent payments (except to the
extent expressly permitted by Section 5.02) until after the payment in full
of all Secured Obligations or otherwise adversely affect the Note Holders.
(b) Without limiting the provisions of Section 9.01(a) hereof
and subject to Section 5.02(a)(2)(i) 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 Trust Indenture, the Lease,
the Purchase Agreement, the Purchase Agreement Assignment, the Consent and
Agreement or the Participation Agreement, 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 effect the Note Holders,
but 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 each
Liquidity Provider, no such amendment of or supplement to this Trust
Indenture, the Lease, the Purchase Agreement, the Purchase Agreement
Assignment, the Consent and Agreement or the Participation Agreement 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 Sections
2.02, 2.10, 2.11, 2.15, 4.02, 4.04(c), 4.04(d), 5.02 or 5.06 hereof,
Section 14 (except to add an Event of Default) of the Lease, the
definitions of "Event of Default", "Default", "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 Lessee,
(iii) reduce, modify or amend any indemnities in favor of the Note Holders,
(iv) consent to any change in the Trust Indenture or the Lease which would
permit redemption of Equipment Notes earlier than permitted under Section
2.10 or 2.11 hereof or the purchase of the Equipment Notes other than as
permitted by Section 2.14 hereof, (v) modify any of the provisions of
Section 3(c)(v) of the Lease, or modify, amend or supplement the Lease or
consent to any assignment of the Lease, in either case releasing Lessee
from its obligations in respect of the payment of Basic Rent, EBO Amount or
Termination Value for the Aircraft or altering the absolute and
unconditional character of the obligations of Lessee to pay Rent as set
forth in Sections 3 and 19 of the Lease 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 Trust
Indenture on the Trust Indenture Estate, except as provided in connection
with the exercise of remedies under Article IV hereof. Without the consent
of Lessee, no amendment or supplement to this Trust Indenture or waiver or
modification of the terms hereof shall adversely affect Lessee.
(c) At any time after the date hereof, 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 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; (iv) to correct or amplify the description
of any property at any time subject to the Lien of this Trust 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 Trust
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 power herein
conferred upon the Owner Trustee, the Owner Participant or 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.
SECTION 9.02. 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 Section 9.01 hereof adversely affects any right, duty, immunity or
indemnity with respect to such institution under this Trust Indenture or
the Lease, such institution may in its discretion decline to execute such
document.
SECTION 9.03. Documents Mailed to Note Holders.
Promptly after the execution by the Owner Trustee or the
Indenture Trustee of any document entered into pursuant to Section 9.01
hereof, the Indenture Trustee shall mail, by first class mail, postage
prepaid, a copy thereof to Lessee and to each Note Holder at its address
last set forth in the Equipment Note Register, but the failure of the
Indenture Trustee to mail such copies shall not impair or affect the
validity of such document.
SECTION 9.04. No Request Necessary for Lease Supplement or
Trust Agreement and Indenture Supplement.
No written request or consent of the Indenture Trustee, the Note
Holders or the Owner Participant pursuant to Section 9.01 hereof shall be
required to enable the Owner Trustee to enter into any Lease Supplement
specifically required by the terms of the Lease or to execute and deliver a
Trust Agreement and Indenture Supplement specifically required by the terms
hereof.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Trust Indenture.
Upon (or at any time after) payment in full of the Principal
Amount of, Make-Whole Amount, if any, and interest on and all other amounts
due under all Equipment Notes and provided that there shall then be no
other Secured Obligations due to the Note Holders, the Indenture
Indemnitees and the Indenture Trustee hereunder or under the Participation
Agreement, 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 releasing the Aircraft, the Engines, the Lease, the
Purchase Agreement, and the Purchase Agreement Assignment with the Consent
and Agreement attached thereto from the Lien of this Trust Indenture and
the Indenture Trustee shall execute and deliver such instrument as
aforesaid and give written notice thereof to Lessee; provided, however,
that this Trust Indenture and the trusts created hereby shall earlier
terminate and this Trust Indenture shall be of no further force or effect
upon any sale or other final disposition by the Indenture Trustee of all
property constituting part of the Trust Indenture Estate and the final
distribution by the Indenture Trustee of all monies or other property or
proceeds constituting part of the Trust Indenture Estate in accordance with
the terms hereof. Except as aforesaid otherwise provided, this Trust
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 holder of an Equipment Note shall have legal title to 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 Trust Indenture or entitle such holder or any successor
or transferee of such holder to an accounting or to the transfer to it of
any 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 Trust Indenture Estate, or
any part thereof (including any part thereof or interest therein), by the
Indenture Trustee made pursuant to the terms of this Trust Indenture 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 such Trust Indenture Estate or
part thereof. 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. Trust Indenture for Benefit of Owner Trustee,
Indenture Trustee, Owner Participant, Lessee, Note Holders and the Other
Indenture Indemnitees.
Nothing in this Trust Indenture, whether express or implied,
shall be construed to give any person other than the Owner Trustee, the
Indenture Trustee, the Owner Participant, Lessee, the Indenture Indemnitees
and the Note Holders, any legal or equitable right, remedy or claim under
or in respect of this Trust Indenture.
SECTION 10.05. Notices.
Unless otherwise expressly specified or permitted by the terms
hereof, all notices, requests, demands, authorizations, directions,
consents, waivers or documents provided or permitted by this Trust
Indenture to be made, given, furnished or filed shall be in writing,
personally delivered or mailed by certified mail, postage prepaid, or by
facsimile or confirmed telex, and (i) if to the Owner Trustee, addressed to
it at its office at 79 South Main Street, Salt Lake City, Utah 84111,
Attention: Corporate Trust Department (Telecopy No. (801) 246-5053), with a
copy to the Owner Participant addressed as provided in clause (iii) below,
(ii) if to the Indenture Trustee, addressed to it at its office at 225
Asylum Street, Goodwin Square, Hartford, Connecticut 06103-1724, Attention:
Corporate Trust Administration (Telecopy No. (860) 244-1889), with a copy
to State Street Corp., 2 Avenue de Lafayette, 6th Floor, Boston,
Massachusetts 02111, Attention: Corporate Trust Department, Ruth A. Smith
(Telecopy No. (617) 662-1461), (iii) if to any Participant, 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 Participation
Agreement or in the Equipment Note Register. Whenever any notice in
writing is required to be given by the Owner Trustee, any Participant or
the Indenture Trustee or any Note Holder or Lessee to any of the other of
them, such notice shall be deemed given and such requirement satisfied when
such notice is received, or if such notice is mailed by certified mail,
postage prepaid, three Business Days after being mailed, addressed as
provided above. 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 Trust Indenture.
SECTION 10.06. Severability.
Any provision of this Trust 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. Any such prohibition or
unenforceability in any particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 10.07. No Oral Modification or Continuing Waivers.
No term or provision of this Trust Indenture or the Equipment
Notes may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by the Owner Trustee and the Indenture
Trustee, in compliance with Section 9.01 hereof. 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 10.08. 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
permitted successors and 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 holder.
This Trust 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 Trust Indenture to the Trust Agreement shall mean the
Trust Agreement as amended and supplemented from time to time to the extent
permitted hereby, thereby and by the Participation Agreement. Each Note
Holder by its acceptance of an Equipment Note agrees to be bound by this
Trust Indenture and all provisions of the Participation Agreement
applicable to a Loan Participant or a Note Holder.
SECTION 10.09. Headings.
The headings of the various Articles and Sections herein and in
the table of contents hereto are for convenience of reference only and
shall not define or limit any of the terms or provisions hereof.
SECTION 10.10. Normal Commercial Relations.
Anything contained in this Trust Indenture to the contrary
notwithstanding, the Owner Trustee, the Indenture Trustee, any Participant
or any bank or other Affiliate of such Participant may conduct any banking
or other financial transactions, and have banking or other commercial
relationships, with Lessee, fully to the same extent as if this Trust
Indenture were not in effect, including without limitation the making of
loans or other extensions of credit to Lessee for any purpose whatsoever,
whether related to any of the transactions contemplated hereby or
otherwise.
SECTION 10.11. Governing Law; Counterpart Form.
THIS TRUST INDENTURE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND
SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE. THIS TRUST INDENTURE IS BEING
DELIVERED IN THE STATE OF NEW YORK. This Trust Indenture may be executed
by the parties hereto in separate counterparts (or upon separate signature
pages bound together into one or more 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 10.12. Voting By Note Holders.
All votes of the Note Holders shall be governed by a vote of a
Majority in Interest of Note Holders, except as otherwise provided herein.
SECTION 10.13. Bankruptcy.
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 hereunder), shall be entitled to the benefits of Section 1110 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 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.
SECTION 10.14. No Action Contrary to Lessee's Rights Under the
Lease.
Notwithstanding any of the provisions of this Trust Indenture or
the Trust Agreement to the contrary, the Indenture Trustee will not take
any action contrary to Lessee's rights under the Lease, including the right
to possession and use of, and the quiet enjoyment of, the Aircraft, except
in accordance with provisions of the Lease.
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Indenture to be duly executed by their respective officers thereof duly
authorized as of the day and year first above written.
FIRST SECURITY BANK,
NATIONAL ASSOCIATION, not in its individual
capacity, except as expressly provided herein,
but solely as Owner Trustee
By: ______________________________________
Name:
Title:
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, as Indenture
Trustee
By:____________________________________
Name:
Title:
Indenture
N___U_
EXHIBIT A
TO
TRUST INDENTURE AND MORTGAGE
TRUST AGREEMENT AND INDENTURE SUPPLEMENT
(US Airways, Inc. Trust No. N___U_)
This TRUST AGREEMENT AND INDENTURE SUPPLEMENT (US Airways, Inc.
Trust No. N___U_) dated _______ __, _____ (herein called this "Trust
Indenture Supplement") of FIRST SECURITY BANK, NATIONAL ASSOCIATION, not in
its individual capacity, but solely as Owner Trustee (herein called the
"Owner Trustee") under that certain Trust Agreement (US Airways, Inc. Trust
No. N___U_) dated as of ____________ __, 199_ (the "Trust Agreement"),
between the Owner Trustee and the Owner Participant named therein.
W I T N E S S E T H:
WHEREAS, the TRUST INDENTURE AND SECURITY AGREEMENT (US Airways,
Inc. Trust No. N___U_) dated as of _________ __, 199_ (as amended and
supplemented to the date hereof, the "Trust Indenture") between the Owner
Trustee and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, 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, and shall
specifically mortgage such Aircraft to the Indenture Trustee; and
WHEREAS, the Trust Indenture relates to the Airframe and Engines
described below, and a counterpart of the Trust Indenture is attached
hereto and made a part hereof and this Trust Indenture Supplement, together
with such counterpart of the Trust Indenture, is being filed for
recordation on the date hereof with the FAA as one document;
NOW, THEREFORE, this Trust Indenture Supplement witnesseth that
the Owner Trustee hereby confirms that the Lien of the Trust Indenture on
the Trust Indenture Estate covers all of Owner Trustee's right, title and
interest in and to the following described property:
AIRFRAME
One airframe identified as follows:
Manufacturer Model Number FAA Registration Manufacturer's
Number Serial Number
Airbus A3__
together with all of the Owner Trustee's right, title and interest in and
to all Parts of whatever nature, whether now owned or hereinafter acquired
and which are from time to time incorporated or installed in or attached to
said airframe.
AIRCRAFT ENGINES
Two aircraft engines, each such engine having 750 or more rated
take-off horsepower or the equivalent thereof, identified as follows:
Manufacturer Manufacturer's
Model Number Serial Number
together with all of Owner Trustee's right, title and interest in and to
all Parts of whatever nature, whether now owned or hereafter acquired and
which are from time to time incorporated or installed in or attached to any
of such engines.
Together with all of Owner Trustee's right, title and interest in
and to all Parts of whatever nature, which from time to time are included
within the definition of "Airframe" or "Engine", whether now owned or
hereafter acquired, including all substitutions, renewals and replacements
of and additions, improvements, accessions and accumulations to the
Airframe and Engines (other than additions, improvements, accessions and
accumulations which constitute appliances, parts, instruments,
appurtenances, accessories, furnishings or other equipment excluded from
the definition of Parts).
As further security for the obligations referred to above and
secured by the Trust Indenture and hereby, the Owner Trustee has granted,
assigned, transferred, conveyed, mortgaged, pledged and confirmed, and does
hereby grant, assign, transfer, convey, mortgage, pledge and confirm, unto
the Indenture Trustee, its successors and assigns, for the security and
benefit of the Loan Participants and of the Note Holders, in the trust
created by the Trust Indenture, all of the right, title and interest of the
Owner Trustee in, to and under the Lease Supplement [of even date herewith]
covering the property described above.
Notwithstanding any provision hereof, no Excluded Payment shall
constitute security for any of the aforementioned obligations.
TO HAVE AND TO HOLD all and singular the aforesaid property unto
the Indenture Trustee, its successors and assigns, in trust for the equal
and proportionate benefit and security of the Note Holders, except as
provided in Section 2.15 and Article III of the Trust Indenture without any
preference, distinction or priority of any one Equipment Note over any
other by reason of priority of time of issue, sale, negotiation, date of
maturity thereof or otherwise for any reason whatsoever, and for the uses
and purposes and subject to the terms and provisions set forth in the Trust
Indenture.
This Trust Indenture Supplement shall be construed as
supplemental to the Trust Indenture and shall form a part thereof. The
Trust Indenture is each hereby incorporated by reference herein and is
hereby ratified, approved and confirmed.
This Trust Indenture Supplement is being delivered in the State
of New York.
AND, FURTHER, the Owner Trustee hereby acknowledges that the
Aircraft referred to in this Trust Indenture 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 Trust Indenture.
IN WITNESS WHEREOF, the Owner Trustee has caused this Trust
Indenture Supplement to be duly executed by one of its officers, thereunto
duly authorized, on the day and year first above written.
FIRST SECURITY BANK,
NATIONAL ASSOCIATION, not in its individual
capacity, but solely as Owner Trustee
By: __________________________________
Name:
Title:
SCHEDULE I
Principal Amount Interest Rate Maturity
Series A 8.36%
Series B 9.01%
Series C 7.96%
SCHEDULE II
PASS THROUGH TRUST AGREEMENT AND PASS THROUGH TRUST SUPPLEMENTS
Pass Through Trust Agreement, dated as of July 30, 1999, between US
Airways, Inc., US Airways Group, Inc. and State Street Bank and Trust
Company of Connecticut, National Association, as supplemented by Trust
Supplement No. 1999-1A, dated as of August 31, 1999, as supplemented by
Trust Supplement No. 1999-1B, dated as of August 31, 1999, and as
supplemented by Trust Supplement No. 1999-1C, dated as of August 31, 1999.
Exhibit 4(a)(xvii)
Exhibit A-4 to Note Purchase Agreement
FORM OF PURCHASE AGREEMENT ASSIGNMENT
(LEASED AIRCRAFT)
PURCHASE AGREEMENT ASSIGNMENT
(US Airways, Inc. Trust No. N___U_)
PURCHASE AGREEMENT ASSIGNMENT (US Airways, Inc. Trust No.
N___U_), dated as of _____________ __, ____, between US AIRWAYS, INC., a
Delaware corporation (the "Assignor" or "Lessee"), and FIRST SECURITY BANK,
NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner
Trustee ("FSB" or "Lessor") under the Trust Agreement (US Airways, Inc.
Trust No. N___U_), dated as of _____________ __, ____, (as amended,
modified or supplemented from time to time, the "Trust Agreement"), between
____________________ (the "Owner Participant") and FSB.
W I T N E S S E T H :
WHEREAS, US Airways Group, Inc. ("Parent") and AVSA (as
hereinafter defined) are parties to the Purchase Agreement (as hereinafter
defined), providing, among other things, for the delivery by AVSA to the
Assignor of certain aircraft, including the Aircraft (as hereinafter
defined) covered by the Participation Agreement (as hereinafter defined);
and
WHEREAS, pursuant to a Purchase Agreement Assignment, dated
as of __________ __, 1999, by and between Parent and Lessee (the "Parent
Assignment"), Parent assigned all of its right, title in and interest in
and to the Purchase Agreement to Assignor to the extent such right, title
and interest relate to certain aircraft, including the Aircraft covered by
the Participation Agreement;
WHEREAS, pursuant to a Consent and Agreement of AVSA and
Guarantor (as hereinafter defined), dated as of ________ __, 1999 (the
"Parent Consent and Agreement"), AVSA and Guarantor consented to the
assignment by Parent to Assignor of Parent's right, title in and interest
in and to the Purchase Agreement as provided for in the Parent Assignment;
WHEREAS, pursuant to the Parent Consent and Agreement,
Guarantor confirmed that its guarantee given in the Consent and Guaranty
(as hereinafter defined) remains in full force and effect and, to the
extent the same relates to the aircraft assigned to Lessee pursuant to the
Parent Assignment, it inures to the benefit of the Assignor;
WHEREAS, pursuant to the Consent and Guaranty, the Guarantor
has agreed, among other things, to unconditionally guarantee the due and
punctual performance by AVSA of all of its liabilities and obligations as
set forth in the Purchase Agreement; and
WHEREAS, pursuant to the Lease (as hereinafter defined), the
Lessor will lease the Aircraft to the Assignor; and
WHEREAS, on the terms and conditions hereof and of the
Consents and Agreements (as hereinafter defined), (a) the Assignor desires
to assign to the Lessor certain of the Assignor's remaining rights, title
and interests in, to and under the Purchase Agreement and the Consent and
Guaranty (insofar as they relate to the Purchase Agreement and the
Aircraft) and (b) the Lessor desires to accept the assignments and, except
as otherwise provided herein, to assume the obligations of the "Buyer"
under the Purchase Agreement, to the extent assigned to it pursuant hereto;
and
WHEREAS, pursuant to the Indenture (as hereinafter defined),
the Lessor will assign, inter alia, its rights hereunder to the Indenture
Trustee (as hereinafter defined) to the extent set forth therein; and
WHEREAS, such assignments and acceptances are intended to
permit consummation of the transactions contemplated by the Participation
Agreement; and
WHEREAS, AVSA and the Guarantor are willing to execute and
deliver their respective Consents and Agreements;
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
1. Defined Terms. For all purposes of this Assignment,
except as otherwise expressly provided or unless the context otherwise
requires, the following terms shall have the following meanings:
"Aircraft" shall mean the Airbus A3__ aircraft, bearing
manufacturer's serial number ___, delivered under the Purchase Agreement,
including the two [CFM International Model 56-5](1) [Pratt & Whitney Model](2)
engines installed on such aircraft on the date of delivery thereof
pursuant to the Purchase Agreement or such other engines as may be
substituted therefore under the Lease.
"AVSA" shall mean AVSA, S.A.R.L., a French societe a
responsabilite limitee, and its successors and assigns.
"AVSA Consent and Agreement" shall mean the Consent and
Agreement of AVSA attached hereto, as amended, modified or supplemented
from time to time.
"Consent and Guaranty" shall mean the Consent and Guaranty
of the Guarantor attached to the Purchase Agreement, together with all
amendments, waivers, and consents heretofore entered into or heretofore
granted thereunder.
"Consents and Agreements" shall mean the AVSA Consent and
Agreement and the Guarantor Consent and Agreement.
"Equipment Notes" shall have the meaning ascribed thereto in
the Participation Agreement.
"Guarantor" shall mean Airbus Industrie, G.I.E., a French
groupement d'interet economique, and its successors and assigns.
"Guarantor Consent and Agreement" shall mean the Consent and
Agreement of the Guarantor attached hereto, as amended, modified or
supplemented from time to time.
"Indenture" shall mean the Trust Indenture and Security
Agreement (US Airways, Inc. Trust No. N___U_), dated as of _____________
__, ____, between the Lessor and the Indenture Trustee, as amended,
modified or supplemented from time to time.
- ----------
1 For A319 and A320 Aircraft.
2 For A330 Aircraft.
"Indenture Trustee" shall mean State Street Bank and Trust
Company of Connecticut, a national banking association, not in its
individual capacity but solely as Indenture Trustee under the Indenture and
each other person which may from time to time be acting as successor
trustee under the Indenture.
"Lease" shall mean the Lease Agreement (US Airways, Inc.
Trust No. N___U_), dated as of _____________ __, ____, between the Lessor
and the Assignor, as amended, modified or supplemented from time to time.
"Participation Agreement" shall mean the Participation
Agreement (US Airways, Inc. Trust No. N___U_), dated as of _____________
__, ____, among the Assignor, the Owner Participant, the Pass Through
Trustee (as defined therein), the Lessor, the Indenture Trustee and the
Subordination Agent (as defined therein), as amended, modified or
supplemented from time to time.
"Purchase Agreement" shall mean the [Airbus A319/A320/A321
Purchase Agreement, dated as of October 31, 1997, between US Airways Group,
Inc. and AVSA](3) [Airbus A330/A340 Purchase Agreement, dated as of November
24, 1998, between US Airways Group, Inc. and AVSA](4), together with all
exhibits, appendices and letter agreements thereto and all amendments,
waivers and consents granted thereunder.
All other terms used herein in capitalized form that are
defined in the Lease shall, when used herein, have the meanings specified
in the Lease.
- -----------
3 For A319 and A320 Aircraft.
4 For A330 Aircraft.
2. Assignment. (a) Generally. The Assignor has sold,
assigned, transferred and set over and does hereby sell, assign, transfer
and set over unto the Lessor (i) all of the Assignor's right, title and
interest in and to (x) Clauses 12, 13 and 17 of the Purchase Agreement (the
"Assigned Rights") and (y) the Consent and Guaranty (insofar as such
Consent and Guaranty relates to the Assigned Rights), as and to the extent
that the same relates to the Aircraft, except to the extent reserved below,
including, without limitation, in such assignment to the Lessor (A) all
claims for damages in respect of such Aircraft arising as a result of any
default by AVSA under Clause 12, 13 or 17 of the Purchase Agreement,
including, without limitation, all warranty, service life policy and
indemnity provisions contained in Clause 12 of the Purchase Agreement in
respect of the Aircraft and all claims thereunder and under the Consent and
Guaranty in respect of the Aircraft and (B) any and all rights of the
Assignor to compel performance of the terms of Clause 12, 13 and 17 of the
Purchase Agreement and the Consent and Guaranty in respect of the Aircraft;
reserving to the Assignor, however, all the Assignor's rights and interests
in and to Clauses 12, 13 and 17 of the Purchase Agreement and the Consent
and Guaranty as and to the extent that Clause 12, 13 or 17 of the Purchase
Agreement and the Consent and Guaranty relate to aircraft other than the
Aircraft and to the extent that the Purchase Agreement and the Consent and
Guaranty relate to any other matters not directly pertaining to the
Aircraft.
(b) Assignment of Rights. If and so long as there shall not
exist and be continuing an Event of Default and, if an Event of Default is
continuing, so long as Lessee or any Sublessee remains in possession of the
Aircraft, the Lessor hereby authorizes the Lessee, to the exclusion of the
Lessor, to exercise in the Lessee's name all rights and powers related to
the Assigned Rights and to retain any recovery or benefit resulting from
the enforcement of any of the Assigned Rights in respect of the Aircraft,
except that the Lessee may not enter into any change order or other
amendment, modification or supplement to the Purchase Agreement without the
written consent or countersignature of the Lessor if such change order,
amendment, modification or supplement would result in any rescission,
cancellation or termination of the Assigned Rights in respect of the
Aircraft or in any way limit the rights assigned hereunder.
(c) Acceptance of Assignment. Subject to the terms hereof,
the Lessor accepts the assignment contained in this clause 2.
(d) Onward Transfer of Rights. Except as provided in Clause
8 hereunder, the Lessor agrees that it may not sell, assign or otherwise
transfer any of the Assigned Rights without the prior written consent of
AVSA.
(e) Requirement of Notice to AVSA. For all purposes of this
Assignment, AVSA shall not be deemed to have knowledge of and need not
recognize any Event of Default, unless and until AVSA shall have received
written notice thereof from the Lessor or the Indenture Trustee addressed
to its Chief Executive Officer, 2, Rond Point Maurice Bellonte, 31700
Blagnac, France (telex 521155F) (fax: 011-33-5- 6130-4011) and, in acting
in accordance with the terms of the Purchase Agreement and this Assignment,
AVSA may act with acquittance and conclusively rely upon any such notice.
3. Certain Rights and Obligations of the Parties. (a)
Assignor Remains Liable. It is expressly agreed that, anything herein
contained to the contrary notwithstanding: (a) the Assignor shall at all
times remain liable to AVSA under the Purchase Agreement to perform all the
duties and obligations of the "Buyer" thereunder to the same extent as if
this Assignment had not been executed; (b) the exercise by the Lessor of
any of the rights assigned hereunder shall not release the Assignor from
any of its duties or obligations to AVSA under the Purchase Agreement
except to the extent that such exercise by the Lessor shall constitute
performance of such duties and obligations; and (c) except as provided in
the next succeeding paragraph, none of the Lessor, the Indenture Trustee
nor any Participant shall have any obligation or liability under the
Purchase Agreement by reason of, or arising out of, this Assignment or be
obligated to perform any of the obligations or duties of the Assignor under
the Purchase Agreement or to make any payment or to make any inquiry as to
the sufficiency of any payment received by any of them or to present or
file any claim or to take any other action to collect or enforce any claim
for any payment assigned hereunder.
(b) Lessor Bound by Purchase Agreement. Without in any way
releasing the Assignor from any of its duties or obligations under the
Purchase Agreement, the Lessor confirms for the benefit of AVSA that,
insofar as the provisions of the Purchase Agreement relate to the Aircraft,
in exercising any rights under the Purchase Agreement, or in making any
claim with respect to the Aircraft or other goods and services delivered or
to be delivered pursuant to the Purchase Agreement, the terms and
conditions of the Purchase Agreement disclosed to the Lessor in writing
shall apply to, and be binding upon, the Lessor to the extent of its
respective interests assigned hereunder to the same extent as the Assignor.
(c) Limit of Effect of this Assignment. Nothing contained
herein shall (i) subject AVSA or the Guarantor to any liability to which it
would not otherwise be subject under the Purchase Agreement or (ii) modify
in any respect the contractual rights of AVSA or the Guarantor thereunder
(except, in each case, as provided in the attached Consents and
Agreements).
(d) Appointment as Attorney-in-Fact. The Assignor does
hereby constitute, effective at any time after an Event of Default shall
have occurred and be continuing, the Lessor and its successors and
permitted assigns to be the Assignor's true and lawful attorney,
irrevocably, with full power (in the name of the Assignor or otherwise) to
ask, require, demand, receive, compound and give acquittance for any and
all monies and claims for monies due and to become due under, or arising
out of, the Purchase Agreement and the Consent and Guaranty in respect of
the Aircraft, to the extent that the same have been assigned as provided in
this Assignment and, for such period as the Lessor, its successors and
assigns may exercise rights with respect thereto under this Assignment, to
endorse any checks or other instruments or orders in connection therewith
and to file any claims or take any action or institute (or, if previously
commenced, assume control of) any proceedings and to obtain any recovery in
connection therewith which the Lessor, its successors and assigns, may deem
to be necessary or advisable in the premises.
4. Further Assurances. The Assignor and the Lessor each
agree that, at any time and from time to time, upon the written request of
any other party hereto, it will promptly and duly execute and deliver any
and all such further instruments and documents and take such further action
as the other may reasonably request in order to obtain the full benefits of
this Assignment and of the rights and powers herein granted.
5. No Amendment of Purchase Agreement. So long as the Lease
is in effect, the Lessor agrees that it shall not enter into any agreement
that would amend, modify, supplement, rescind, cancel or terminate the
Purchase Agreement or the Consent and Guaranty in any respect or in any way
limit the rights of the Assignor or any of the other rights assigned
hereunder (except as set forth above when there has been an Event of
Default), without the prior written consent of the Assignor.
6. Execution of Assignment. This Assignment is executed by
the Assignor and the Lessor concurrently with the execution and delivery of
the Participation Agreement and the Lease.
7. Confidentiality. The Lessor agrees that it will not
disclose to any third party the terms of the Purchase Agreement or this
Assignment, except (a) as required by applicable law or governmental
regulation, (b) as contemplated in the Lease or the Participation Agreement
(including as set forth in Section 7(o) of the Participation Agreement) or
(c) with the consent of the Assignor, the Guarantor and AVSA.
8. Assignment as Collateral. Each party hereto consents to
the assignment and pledge by the Lessor to the Indenture Trustee, as
security for the Equipment Notes to be issued under the Indenture and the
other obligations secured thereby as specified in the Indenture, of all of
the Lessor's right, title and interest in and to the Assigned Rights and
the Consent and Guaranty under this Assignment which assignment shall be on
terms identical to this Assignment.
9. Counterparts. This Assignment 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.
10. GOVERNING LAW. THIS ASSIGNMENT SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
11. Successors and Assigns. This Assignment shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
12. Notices. All notices with respect to the matters
contained herein shall be delivered (notices with respect to AVSA shall be
sent to the address for AVSA set forth in clause 2(d)) in the manner
provided in Section 12(a) of the Participation Agreement.
13. No Oral Amendments. Neither this Assignment nor any of
the terms hereof may be terminated, amended, supplemented, waived or
modified orally, but only by an instrument in writing signed by the party
against whom the enforcement of such termination, amendment, supplement,
waiver or modification is sought.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment to be duly executed as of the day and year first above written.
US AIRWAYS, INC.
By: _________________________________
Name:
Title:
` FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual capacity
but solely as Lessor
By: ________________________________
Name:
Title:
AIRBUS INDUSTRIE CONSENT AND AGREEMENT
The undersigned, Airbus Industrie G.I.E., a groupement
d'interet economique established under Ordonnance No. 67-821 dated
September 23, 1967 of the Republic of France (the "Guarantor"), hereby
acknowledges notice of and consents to all of the terms of the Purchase
Agreement Assignment between US Airways, Inc., a Delaware corporation, and
First Security Bank, National Association, not in its individual capacity,
but solely as Lessor, with respect to US Airways, Inc. Trust No. N7___UW,
dated as of ______________ (hereinafter called the "Assignment", the
defined terms therein being hereinafter used with the same meaning), and to
the assignment of the Assigned Rights to the Indenture Trustee under the
Indenture, dated as of ______________, between ___________ and ____________
(hereinafter called the "Indenture"), and hereby confirms to the Assignor
and the Lessor and their respective successors and assigns that:
(i) except as provided in the Assignment, all representations,
warranties, and agreements of the Guarantor under the Consent and
Guaranty insofar as they relate to the Assigned Rights with respect
to the Aircraft shall inure to the benefit of the Lessor and its
respective successors and permitted assigns, to the same extent as
if the Lessor and its successors and permitted assigns had
originally been named the "Buyer" of the Aircraft therein;
(ii) the Guarantor will pay to the person or entity entitled to
receive the corresponding payment from AVSA under the terms of the
Assignment all amounts required to be paid by the Guarantor with
respect to the
Aircraft;
(iii) the Guarantor consents to the sale of the Aircraft by Lessee
to the Lessor, the assignment of Assignor's rights and interests
under the Purchase Agreement and the Consent and Guaranty to the
Lessor pursuant to the Assignment and to the assignment of the
Lessor's rights and interests in the Assignment to the Indenture
Trustee pursuant to the Indenture and the lease of the Aircraft by
the Lessor to the Assignor under the Lease; and
(iv) from and after the purchase of the Aircraft pursuant to the
Participation Agreement and payment in full for the Aircraft, the
Guarantor will not assert any lien or claim against the Aircraft or
any part thereof or against the Lessee, the Lessor, the Owner
Participant or the Indenture Trustee arising on or prior to such
purchase or in respect of any work or services performed on or
prior thereto.
The Guarantor hereby represents and warrants that:
(A) the Guarantor is a groupement d'interet economique duly
organized and existing in good standing under the laws of the Republic of
France and has the requisite power and authority to enter into and perform
its obligations under the Consent and Guaranty and this Consent and
Agreement;
(B) the making and performance, in accordance with their
terms of the Consent and Guaranty and this Consent and Agreement have been
duly authorized by all necessary corporate action on the part of the
Guarantor, do not require the consent or approval of the members of the
Guarantor, do not require the consent or approval of,or the giving of
notice to, or registration with, or the taking of any other action in
respect of, any French governmental authority or agency except for those
that have already been obtained and do not contravene any law binding on
the Guarantor or contravene the Guarantor's charter documents or any
indenture, credit agreement or other contractual agreement to which the
Guarantor is a party or by which it is bound;
(C) the Consent and Guaranty constituted, as of the date
thereof and at all times thereafter to and including the date of this
Consent and Agreement, and each of this Consent and Agreement and the
Consent and Guaranty constitutes, binding obligations of the Guarantor
enforceable against the Guarantor in accordance with their respective
terms, subject to: (i) the limitations of applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the rights
of creditors generally; and (ii) general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
at law), which principles do not make the remedies available at law or in
equity with respect to the Purchase Agreement and this Consent and
Agreement inadequate for the practical realization of the benefits intended
to be provided thereby; and
(D) the Consent and Guaranty is in full force and effect.
This Consent and Agreement is made subject to and with the
benefit of Clause 3 of the Assignment and Section 4.03 of the Indenture.
* * * * * *
THIS CONSENT AND AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING
ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
Dated as of ________________
AIRBUS INDUSTRIE G.I.E.
By: _______________________________
Name:
Title:
AVSA CONSENT AND AGREEMENT
The undersigned, AVSA, S.A.R.L., a societe a responsabilite
limitee organized and existing under the laws of the Republic of France
("AVSA"), hereby acknowledges notice of and consents to all of the terms of
the Purchase Agreement Assignment between US Airways, Inc., a Delaware
corporation, and First Security Bank, National Association, not in its
individual capacity, but solely as Lessor, with respect to US Airways, Inc.
Trust No. N___U_, dated as of ______________ (hereinafter called the
"Assignment," the defined terms therein being hereinafter used with the
same meaning), and to the assignment of the Assigned Rights to the
Indenture Trustee under the Indenture, dated as of _____________, between
__________ and _____________ (hereinafter called the "Indenture"), and
hereby confirms to the Assignor and the Lessor and their respective
successors and assigns that:
(i) except as provided in the Assignment, all representations,
warranties, indemnities and agreements of AVSA under the Purchase
Agreement insofar as they relate to the Assigned Rights with
respect to the Aircraft shall inure to the benefit of the Lessor
and its respective successors and permitted assigns to the same
extent as if the Lessor and its successors and permitted assigns
had originally been named the "Buyer" of the Aircraft therein;
(ii) AVSA will pay to the Assignor all payments required to be paid
by it under the Purchase Agreement, unless and until AVSA shall
have received written notice from the Indenture Trustee or the
Lessor (or, after the Indenture shall have been discharged in full,
the Lessor) addressed to it at the address and in the manner set
forth in the Assignment that an Event of Default has occurred and
is continuing, whereupon AVSA will make any and all payments
thereafter required to be made by it under the Purchase Agreement,
to the extent that the right to receive such payment has been
assigned under the Assignment ("AVSA Payments"), directly to the
Indenture Trustee (or, after the Indenture shall have been
discharged in full, the Lessor) if AVSA shall have received notice
as aforesaid that an Event of Default has occurred and is
continuing;
(iii) The Lessor shall not be liable for any of the obligations or
duties of the Assignor under the Purchase Agreement, nor shall the
Assignment give rise to any duties or obligations whatsoever on the
part of the Lessor owing to AVSA, except for the agreements of the
Lessor set forth in the Assignment, including, but not limited to
clause 3(b) of the Assignment;
(iv) AVSA consents to the sale of the Aircraft by Lessee to Lessor,
assignment of the Lessor's rights and interests in the Assignment
to the Indenture Trustee pursuant to the Indenture and to the lease
of the Aircraft by the Lessor to the Lessee under the Lease; and
(v) from and after the purchase of the Aircraft pursuant to the
Participation Agreement and payment in full for the Aircraft, AVSA
will not assert any lien or claim against the Aircraft or any part
thereof arising on or prior to such purchase or in respect of any
work or services performed on or prior thereto.
AVSA hereby represents and warrants that:
(A) AVSA is a societe a responsabilite limitee duly
organized and existing in good standing under the laws of the Republic of
France and has the requisite power and authority to enter into and perform
its obligations under the Purchase Agreement and this Consent and
Agreement;
(B) the making and performance, in accordance with their
terms, of the Purchase Agreement and this Consent and Agreement have been
duly authorized by all necessary corporate action on the part of AVSA, do
not require any approval of AVSA's shareholders, do not require the consent
or approval of, the giving notice to, or registration with, or the taking
of any other action in respect of, any French governmental authority or
agency except for those that have already been obtained and do not
contravene any law binding on AVSA or contravene AVSA's charter documents
or any indenture, credit agreement or other contractual agreement to which
AVSA is a party or by which it is bound;
(C) each of the Purchase Agreement and this Consent and
Agreement constitutes a binding obligation of AVSA enforceable against AVSA
in accordance with its terms, subject to: (i) the limitations of applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally; and (ii) general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), which principles do not make the remedies
available at law or in equity with respect to the Purchase Agreement and
this Consent and Agreement inadequate for the practical realization of the
benefits intended to be provided thereby; and
(D) the Purchase Agreement is in full force and effect as to
AVSA.
This Consent and Agreement is made subject to and with the
benefit of Clause 3 of the Assignment and Section 4.03 of the Indenture.
* * * * * *
THIS CONSENT AND AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING
ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
Dated as of ________________
AVSA, S.A.R.L.
By: ________________________________
Name:
Title:
Exhibit 4(a)(xviii)
AFFIDAVIT OF CITIZENSHIP
[OWNER PARTICIPANT]
STATE OF _______________ }
} SS.
COUNTY OF ____________ }
I, _______________, being duly sworn, depose and say, that:
1. I am the duly qualified and acting [Assistant] Secretary of [Owner
Participant] (the "Corporation");
2. The Corporation is duly organized under the laws of the State of
__________;
3. The [Chief Executive Officer/President] and two-thirds or more of the
Board of Directors and other managing officers of the Corporation are
individuals who are citizens of the United States of America;
4. At least seventy-five percent (75%) of the voting interest of the
Corporation is owned or controlled by persons or corporations who are
citizens of the United States of America;
5. Accordingly, the Corporation is a "Citizen of the United States" as
defined in Section 40102(a)(15) of Title 49 of the United States Code.
SWORN to this ____ day of __________, ____.
[OWNER PARTICIPANT]
By: ___________________________
Name:
Title:
SWORN AND SUBSCRIBED TO
before me this ____ day of
__________, ____
----------------------------
Notary Public
My Commission Expires on _________________
TRUST AGREEMENT
(US Airways, Inc. Trust No. N___U_)
Dated as of _________ __, ____
between
[OWNER PARTICIPANT],
Owner Participant
and
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
Owner Trustee
One Airbus A3__ Aircraft
FAA Registration Mark N___U_
TRUST AGREEMENT
(US Airways, Inc. Trust No. N___U_)
This TRUST AGREEMENT (US Airways, Inc. Trust No. N___U_) dated
as of _________ __, ____ between [OWNER PARTICIPANT], a __________
corporation (the "Owner Participant"), and FIRST SECURITY BANK, NATIONAL
ASSOCIATION, a national banking association (in its individual capacity,
"FSB") and otherwise not in its individual capacity but solely as trustee
hereunder (herein in such capacity with its permitted successors and
assigns called the "Owner Trustee") (as hereafter from time to time
supplemented or amended, this or the "Trust Agreement");
NOW THEREFORE, in consideration of the mutual covenants and
agreements contained herein, FSB and the Owner Participant hereby agree as
follows:
W I T N E S S E T H:
ARTICLE I
DEFINITIONS AND TERMS
SECTION 1.01 CERTAIN DEFINITIONS. Capitalized terms used but
not defined herein shall have the respective meanings set forth or
incorporated by reference, and shall be construed and interpreted in the
manner described, in Annex A.
ARTICLE II
AUTHORITY TO EXECUTE CERTAIN OPERATIVE DOCUMENTS;
DECLARATION OF TRUST
SECTION 2.01 AUTHORITY TO EXECUTE DOCUMENTS. The Owner
Participant hereby authorizes and directs the Owner Trustee to execute and
deliver the Operative Documents and any other agreements, instruments or
documents to which the Owner Trustee is a party in the respective forms
thereof in which delivered from time to time by the Owner Participant to
the Owner Trustee for execution and delivery and, subject to the terms
hereof, to perform its duties and, upon instructions from the Owner
Participant, exercise its rights under said Operative Documents in
accordance with the terms thereof.
SECTION 2.02 DECLARATION OF TRUST. The Owner Trustee hereby
declares that it shall continue to hold the Trust Estate upon the trusts
hereinafter set forth for the use and benefit of the Owner Participant,
subject, however, to the provisions of and the Lien created by the Trust
Indenture and to the provisions of the Lease.
ARTICLE III
ACCEPTANCE AND DELIVERY OF AIRCRAFT
SECTION 3.01 ACCEPTANCE OF AIRCRAFT. The Owner Participant
hereby authorizes and directs the Owner Trustee to, and the Owner Trustee
agrees for the benefit of the Owner Participant that it will, on the
Delivery Date, subject to due compliance with the terms of Section 3.02
hereof:
(a) purchase the Aircraft pursuant to the Participation
Agreement and the Bill of Sale;
(b) accept from Lessee the delivery of the Bill of Sale and the
FAA Bill of Sale;
(c) cause the Aircraft to be leased to Lessee under the Lease,
and in furtherance thereof execute and deliver a Lease Supplement
covering the Aircraft;
(d) execute and deliver the Trust Supplement covering the
Aircraft;
(e) execute and deliver the financing statements referred to in
Section 4(a)(vi) of the Participation Agreement, together with all
other agreements, documents and instruments referred to in Section 4
of the Participation Agreement to which the Owner Trustee is a party;
and
(f) effect the registration of the Aircraft in the name of the
Owner Trustee by filing or causing to be filed with the FAA: (i) the
FAA Bill of Sale; (ii) an application for registration of the Aircraft
in the name of the Owner Trustee (including without limitation an
affidavit from the Owner Trustee in compliance with the provisions of
14 C.F.R. section 47.7(c)(2)(ii)(1979)); and (iii) the Trust
Agreement.
SECTION 3.02 CONDITIONS PRECEDENT. The right and obligation of
the Owner Trustee to take the action required by Section 3.01 hereof with
respect to the Aircraft shall be subject to the following conditions
precedent:
(a) the Owner Participant shall have made the full amount of its
Commitment set forth in Schedule II of the Participation Agreement
available to the Owner Trustee, in immediately available funds, in
accordance with Section 2 of the Participation Agreement; and
(b) the terms and conditions of Section 4 of the Participation
Agreement, insofar as they relate to the Aircraft, shall have been
complied with in a manner satisfactory to the Owner Participant and
the Owner Trustee.
SECTION 3.03 AUTHORIZATION IN RESPECT OF A TERMINATION OF THE
LEASE AND ASSUMPTION OF THE EQUIPMENT NOTES. The Owner Participant hereby
authorizes and directs the Owner Trustee to, and the Owner Trustee agrees
for the benefit of the Owner Participant that it will, take the actions
specified to be taken by the Owner Trustee in Section 7(u) of the
Participation Agreement upon Lessee's purchasing the Aircraft pursuant to
Section 9(d), 19(b) or 20 of the Lease and upon Lessee's assuming the
indebtedness evidenced by the Equipment Notes in accordance with the
provisions of such Section 7(u).
SECTION 3.04 AUTHORIZATION IN RESPECT OF A REPLACEMENT AIRFRAME
OR REPLACEMENT ENGINES. The Owner Participant hereby authorizes and directs
the Owner Trustee to, and the Owner Trustee agrees for the benefit of the
Owner Participant that it will, in the event of a Replacement Airframe and
Replacement Engines, if any, being substituted pursuant to Section 10(a) of
the Lease, or a Replacement Engine being substituted pursuant to Section
10(b) of the Lease, subject to due compliance with the terms of Section
10(a) or 10(b) of the Lease, as the case may be:
(a) to the extent not previously accomplished by a prior
authorization, authorize a representative or representatives of the
Owner Trustee (who shall be an employee or employees of Lessee) to
accept delivery of the Replacement Airframe and Replacement Engines,
if any, or the Replacement Engines;
(b) accept from Lessee or other vendor of the Replacement
Airframe and Replacement Engines, if any, or the Replacement Engine a
bill of sale or bills of sale (if tendered), and the invoice, if any,
with respect to the Replacement Airframe and Replacement Engines, if
any, or the Replacement Engine being furnished pursuant to Section
10(a) or (b) of the Lease;
(c) in the case of a Replacement Airframe, make application to
the Federal Aviation Administration for the registration in the name
of the Owner Trustee of the Aircraft of which such Replacement
Airframe is a part;
(d) execute and deliver a Lease Supplement and a Trust
Supplement covering (i) the Aircraft of which such Replacement
Airframe is part or (ii) such Replacement Engine, as the case may be;
(e) transfer its interest in (without recourse except as to
obligations in respect of Lessor Liens) and to the Airframe and
Engines (if any) or the Engine being replaced to Lessee;
(f) request in writing that the Indenture Trustee execute and
deliver to Lessee appropriate instruments to release the Airframe and
Engines or engines (if any) or the Engine or engine being replaced
from the lien created under the Trust Indenture and release the
Purchase Agreement and the Purchase Agreement Assignment (solely with
respect to such replaced Airframe and Engines, if any, or Engine) from
the assignment and pledge under the Trust Indenture; and
(g) upon instructions from the Owner Participant, take such
further action as may be contemplated by clauses (A) and (B) of the
third paragraph of Section 10(a) of the Lease or clauses (ii) and
(iii) of Section 10(b) of the Lease, as the case may be.
SECTION 3.05 TRUST AGREEMENT REMAINING IN FULL FORCE AND
EFFECT. In the event of the substitution of a Replacement Airframe for the
Airframe or the substitution of a Replacement Engine for any Engine or
engine, all provisions of this Trust relating to such replaced Airframe or
Engine or engine shall be applicable to such Replacement Airframe or
Replacement Engine with the same force and effect as if such Replacement
Airframe or Replacement Engine were the same airframe or engine as the
Airframe or Engine being replaced but for the Event of Loss with respect to
such Airframe or Engine.
SECTION 3.06 AUTHORIZATION IN RESPECT OF A RETURN OF AN ENGINE.
The Owner Participant hereby authorizes and directs the Owner Trustee to,
and the Owner Trustee agrees for the benefit of the Owner Participant that
it will, in the event of an engine being transferred to the Owner Trustee
pursuant to Section 5 of the Lease, subject to due compliance with the
terms of such Section 5:
(a) accept from Lessee the bill of sale with respect to such
engine contemplated by such Section 5 (if tendered);
(b) transfer its interest in (without recourse except as to
obligations in respect of Lessor Liens) and to an Engine to Lessee as
contemplated by such Section 5; and
(c) request in writing that the Indenture Trustee execute and
deliver to Lessee appropriate instruments to release the Engine being
transferred to Lessee pursuant to such Section 5 from the lien of the
Trust Indenture and to release the Purchase Agreement and the Purchase
Agreement Assignment (solely with respect to such Engine) from the
assignment and pledge under the Trust Indenture.
ARTICLE IV
RECEIPT, DISTRIBUTION AND APPLICATION
OF INCOME FROM THE TRUST ESTATE
SECTION 4.01 DISTRIBUTION OF PAYMENTS. (a) Payments to
Indenture Trustee. Until the Trust Indenture shall have been discharged
pursuant to Section 10.01 thereof, all Basic Rent, Supplemental Rent,
insurance proceeds and requisition or other payments of any kind included
in the Trust Estate (other than Excluded Payments) payable to the Owner
Trustee shall be payable directly to the Indenture Trustee (and if any of
the same are received by the Owner Trustee shall upon receipt be paid over
to the Indenture Trustee without deduction, set-off or adjustment of any
kind) for distribution in accordance with the provisions of Article III of
the Trust Indenture.
(b) Payments to Owner Trustee; Other Parties. After the Trust
Indenture shall have been discharged pursuant to Section 10.01 thereof, any
payment of the type referred to in Section 4.01(a) hereof (other than
Excluded Payments) received by the Owner Trustee, any payments received
from the Indenture Trustee other than as specified in Section 4.01(d)
hereof and any other amount received as part of the Trust Estate and for
the application or distribution of which no provision is made herein, shall
be distributed forthwith upon receipt by the Owner Trustee in the following
order of priority: first, so much of such payment as shall be required to
reimburse the Owner Trustee for any expenses not otherwise reimbursed as to
which the Owner Trustee is entitled to be so reimbursed pursuant to the
provisions hereof shall be retained by the Owner Trustee; second, so much
of the remainder for which provision as to the application thereof is
contained in the Lease or any of the other Operative Documents shall be
applied and distributed in accordance with the terms of the Lease or such
other Operative Document; and third, the balance, if any, shall be paid to
the Owner Participant.
(c) Certain Distributions to Owner Participant. All amounts from
time to time distributable by the Indenture Trustee to the Owner
Participant pursuant to the Trust Indenture shall, if paid to the Owner
Trustee, be distributed by the Owner Trustee to the Owner Participant in
accordance with the provisions of Article III of the Trust Indenture.
(d) Excluded Payments. Any Excluded Payments received by the
Owner Trustee shall be paid by the Owner Trustee to the Person to whom such
Excluded Payments are payable under the provisions of the Participation
Agreement, the Tax Indemnity Agreement or the Lease.
SECTION 4.02 METHOD OF PAYMENTS. The Owner Trustee shall make
distributions or cause distributions to be made to the Owner Participant
pursuant to this Article IV by transferring by wire transfer the amount to
be distributed to such account or accounts of the Owner Participant as the
Owner Participant may designate from time to time in writing to the Owner
Trustee. Notwithstanding the foregoing, the Owner Trustee will, if so
requested by the Owner Participant in writing, pay any or all amounts
payable to the Owner Participant pursuant to this Article IV either (i) by
crediting such amount or amounts to an account or accounts maintained by
the Owner Participant with the Owner Trustee in its individual capacity in
immediately available funds, (ii) by payment at the trust office of the
Owner Trustee (the trust office of the Owner Trustee shall be the principal
corporate trust office of the Owner Trustee at 79 South Main Street, Salt
Lake City, Utah 84111, Attention: Corporate Trust Department, or the
principal corporate trust office of any successor Owner Trustee), in
immediately available funds, or (iii) by mailing an official bank check or
checks in such amount or amounts payable to the Owner Participant at such
address as the Owner Participant shall have designated in writing to the
Owner Trustee.
ARTICLE V
DUTIES OF THE OWNER TRUSTEE
SECTION 5.01 NOTICE OF EVENT OF DEFAULT. If the Owner Trustee
shall have knowledge of a Lease Event of Default or an Indenture Event of
Default (or a Lease Default or an event which with the passage of time or
the giving of notice or both would constitute an Indenture Event of
Default) the Owner Trustee shall give to the Owner Participant prompt
telephonic or telecopy notice thereof followed by prompt confirmation
thereof by certified mail, postage prepaid, provided that (i) in the case
of an event which, with the passage of time would constitute an Indenture
Event of Default referred to in paragraph (c) of Section 4.02 of the Trust
Indenture, such notice shall in no event be furnished later within ten (10)
days after the Owner Trustee shall first have knowledge of such event and
(ii) in the case of a misrepresentation by the Owner Trustee which with the
passage of time would constitute an Indenture Event of Default referred to
in paragraph (d) of Section 4.02 of the Trust Indenture, such notice shall
in no event be furnished later than ten (10) days after the Owner Trustee
shall first have knowledge of such event. Subject to the terms of Section
5.03 hereof, the Owner Trustee shall take such action or shall refrain from
taking such action, not inconsistent with the provisions of the Trust
Indenture, with respect to such Lease Event of Default, Indenture Event of
Default or other event as the Owner Trustee shall be directed in writing by
the Owner Participant. If the Owner Trustee shall not have received
instructions as above provided within twenty (20) days after the mailing of
such notice to the Owner Participant, the Owner Trustee until instructed
otherwise in accordance with the preceding sentence may, but shall be under
no duty to, take or refrain from taking such action with respect to such
Lease Event of Default, Indenture Event of Default or other event, not
inconsistent with the provisions of the Trust Indenture, as it shall deem
advisable in the best interests of the Owner Participant. For all purposes
of this Trust Agreement, the Lease and the other Operative Documents, in
the absence of actual knowledge by an officer of FSB in the Corporate Trust
Department, the Owner Trustee shall not be deemed to have knowledge of a
Lease Event of Default, an Indenture Event of Default or other event
referred to in this Section 5.01 unless notified in writing by the
Indenture Trustee, the Owner Participant or Lessee.
SECTION 5.02 ACTION UPON INSTRUCTIONS. Subject to the terms of
Sections 5.01 and 5.03 hereof, upon the written instructions at any time
and from time to time of the Owner Participant, the Owner Trustee will take
such of the following actions, not inconsistent with the provisions of the
Trust Indenture, as may be specified in such instructions: (i) give such
notice or direction or exercise such right, remedy or power hereunder or
under any of the Operative Documents to which the Owner Trustee is a party
or in respect of all or any part of the Trust Estate as shall be specified
in such instructions (including entering into agreements referred to in
clause (i) of Section 8.01 hereof and in clause (U) of Section 7(k) of the
Participation Agreement); (ii) take such action to preserve or protect the
Trust Estate (including the discharge of Liens) as may be specified in such
instructions; (iii) approve as satisfactory to it all matters required by
the terms of the Lease or the other Operative Documents to be satisfactory
to the Owner Trustee, it being understood that without written instructions
of the Owner Participant, the Owner Trustee shall not approve any such
matter as satisfactory to it (it being understood that the provisions of
Sections 3.03, 3.04 and 3.06 hereof do not constitute instructions by the
Owner Participant for the Owner Trustee to approve of or consent to the
matters to be approved of or consented to by the Owner Trustee in the
sections of the Lease referred to in Sections 3.03, 3.04 or 3.06 hereof);
and (iv) subject to the rights of Lessee under the Operative Documents,
after the expiration or earlier termination of the Lease, deliver the
Aircraft to the Owner Participant in accordance with such instructions,
convey all of the Owner Trustee's right, title and interest in and to the
Aircraft for such amount, on such terms and to such purchaser or purchasers
as shall be designated in such instructions, or net lease the Aircraft on
such terms and to such lessee or lessees as shall be designated in such
instructions.
SECTION 5.03 INDEMNIFICATION. The Owner Trustee shall not be
required to take any action under Section 5.01 (other than the giving of
the notices referred to therein) or 5.02 hereof unless the Owner Trustee
shall have been indemnified by the Owner Participant, in manner and form
satisfactory to the Owner Trustee, against any liability, cost or expense
(including reasonable counsel fees and disbursements) which may be incurred
in connection therewith; and, if the Owner Participant shall have directed
the Owner Trustee to take any such action or refrain from taking any
action, the Owner Participant agrees to furnish such indemnity as shall be
required and, in addition, to the extent not otherwise paid pursuant to the
provisions of the Lease or the Participation Agreement, to pay the
reasonable compensation of the Owner Trustee for the services performed or
to be performed by it pursuant to such direction and any fees and
disbursements of counsel or agents employed by the Owner Trustee in
connection therewith. The Owner Trustee shall not be required to take any
action under Section 5.01 or 5.02 hereof if the Owner Trustee shall
reasonably determine, or shall have been advised by counsel, that such
action is contrary to the terms of any of the Operative Documents to which
the Owner Trustee is a party, or is otherwise contrary to law.
SECTION 5.04 NO DUTIES EXCEPT AS SPECIFIED IN TRUST AGREEMENT
OR INSTRUCTIONS. The Owner Trustee shall not have any duty or obligation to
manage, control, use, sell, dispose of or otherwise deal with the Aircraft
or any other part of the Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with any of the Operative
Documents to which the Owner Trustee is a party, except as expressly
required by the terms of any of the Operative Documents to which the Owner
Trustee is a party, or (to the extent not inconsistent with the provisions
of the Trust Indenture) as expressly provided by the terms hereof or in
written instructions from the Owner Participant received pursuant to the
terms of Section 5.01 or 5.02, and no implied duties or obligations shall
be read into this Trust Agreement against the Owner Trustee. FSB agrees
that it will, in its individual capacity and at its own cost or expense
(but without any right of indemnity in respect of any such cost or expense
under Section 7.01 hereof) promptly take such action as may be necessary to
duly discharge and satisfy in full all Lessor Liens which it is required to
discharge pursuant to Section 7(f) of the Participation Agreement and
otherwise comply with the terms of said Section binding on it.
SECTION 5.05 SATISFACTION OF CONDITIONS PRECEDENT. Anything
herein to the contrary notwithstanding, the Owner Trustee shall comply with
the provisions of Section 3.01 hereof upon the satisfaction, to the
satisfaction of special counsel for the Owner Trustee, of all the
applicable conditions precedent specified in Section 3.02 hereof and in
Section 4 of the Participation Agreement.
SECTION 5.06 NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR
INSTRUCTIONS. The Owner Trustee shall not have any power, right or
authority to, and the Owner Trustee agrees that it will not, manage,
control, use, sell, dispose of or otherwise deal with the Aircraft or any
other part of the Trust Estate except (i) as expressly required by the
terms of any of the Operative Documents to which the Owner Trustee is a
party, (ii) as expressly provided by the terms hereof, or (iii) as
expressly provided in written instructions from the Owner Participant
pursuant to Section 5.01 or 5.02 hereof.
ARTICLE VI
THE OWNER TRUSTEE
SECTION 6.01 ACCEPTANCE OF TRUSTS AND DUTIES. FSB accepts the
trusts hereby created and agrees to perform the same but only upon the
terms hereof applicable to it. The Owner Trustee also agrees to receive and
disburse all monies received by it constituting part of the Trust Estate
upon the terms hereof. FSB shall not be answerable or accountable under
any circumstances, except (a) for its own willful misconduct or gross
negligence, (b) for performance of the terms of the last sentence of
Section 5.04 hereof, (c) for its or the Owner Trustee's failure to use
ordinary care to disburse funds and (d) for liabilities that may result
from the inaccuracy of any representation or warranty of it (or from the
failure by it to perform any covenant) in Section 6.03 hereof, in Section
6.03 of the Trust Indenture, in Section 4 of the Lease or in Sections 7(a),
7(b), 7(f), 7(g), 7(m), 7(o), 7(p), 7(s) or 7(u) of the Participation
Agreement.
SECTION 6.02 ABSENCE OF CERTAIN DUTIES. Except in accordance
with written instructions furnished pursuant to Section 5.02 hereof and
except as provided in, and without limiting the generality of, Section 5.04
hereof and the last sentence of Section 9.01(b) hereof, neither the Owner
Trustee nor FSB shall have any duty (i) to see to any recording or filing
of any Operative Document or of any supplement to any thereof or to see to
the maintenance of any such recording or filing or any other filing of
reports with the Federal Aviation Administration or other governmental
agencies, except that FSB, in its individual capacity, shall comply with
the reporting requirements set forth in 14 C.F.R. section 47.45 or any
successor provision and the Owner Trustee shall, to the extent that
information for that purpose is supplied by Lessee pursuant to any of the
Operative Documents, complete and timely submit (and furnish the Owner
Participant with a copy of) any and all reports relating to the Aircraft
which may from time to time be required by the Federal Aviation
Administration or any government or governmental authority having
jurisdiction, or (ii) to see to any insurance on the Aircraft or to effect
or maintain any such insurance, whether or not Lessee shall be in default
with respect thereto, other than to forward to the Owner Participant copies
of all reports and other written information which the Owner Trustee
receives from Lessee pursuant to Section 11 of the Lease, (iii) to see to
the payment or discharge of any tax, assessment or other governmental
charge or any lien or encumbrance of any kind owing with respect to,
assessed or levied against any part of the Trust Indenture Estate or the
Trust Estate, except as provided in Section 7 of the Participation
Agreement, or (iv) to inspect Lessee's books and records with respect to
the Aircraft at any time permitted pursuant to the Lease. Notwithstanding
the foregoing, the Owner Trustee will furnish to the Indenture Trustee and
the Owner Participant, 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 or any other Operative Document.
SECTION 6.03 NO REPRESENTATIONS OR WARRANTIES AS TO CERTAIN
MATTERS. NEITHER THE OWNER TRUSTEE NOR FSB MAKES OR SHALL BE DEEMED TO
HAVE MADE (A) ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE
TITLE, VALUE, CONDITION, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR
USE OF THE AIRCRAFT OR ANY PART THEREOF, OR ANY OTHER REPRESENTATION OR
WARRANTY WITH RESPECT TO THE AIRCRAFT WHATSOEVER, except that FSB in its
individual capacity warrants that on the Delivery Date the Owner Trustee
shall have received whatever title was conveyed to it by Lessee and that
the Aircraft shall during the Term be free of Lessor Liens attributable to
it, or (b) any representation or warranty as to the validity, legality or
enforceability of this Trust Agreement or any Operative Document to which
the Owner Trustee is a party, or any other document or instrument, or as to
the correctness of any statement contained in any thereof except to the
extent that any such statement is expressly made herein or therein as a
representation by FSB in its individual capacity or by the Owner Trustee
and except that FSB in its individual capacity hereby represents and
warrants that this Trust Agreement has been, and (assuming due
authorization, execution and delivery by the Owner Participant of this
Trust Agreement) the Operative Documents to which it or the Owner Trustee
is a party have been (or at the time of execution and delivery of any such
instrument by it or the Owner Trustee hereunder or pursuant to the terms of
the Participation Agreement that such an instrument will be) duly executed
and delivered by one of its officers who is or will be, as the case may be,
duly authorized to execute and deliver such instruments on behalf of itself
or the Owner Trustee, as the case may be.
SECTION 6.04 NO SEGREGATION OF MONIES REQUIRED; NO INTEREST.
Except as provided in Section 23 of the Lease, monies received by the Owner
Trustee hereunder 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 Owner Trustee shall not be liable for any
interest thereon.
SECTION 6.05 RELIANCE UPON CERTIFICATES, COUNSEL AND AGENTS.
The Owner Trustee shall incur no liability to anyone in acting in reliance
upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper
reasonably believed by it to be genuine and reasonably believed by it to be
signed by the proper party or parties. Unless other evidence in respect
thereof is specifically prescribed herein, any request, direction, order or
demand of the Owner Participant or Lessee mentioned herein or in any of the
Operative Documents to which the Owner Trustee is a party shall be
sufficiently evidenced by written instruments signed by a person purporting
to be the chairman of the board, the president, any executive vice
president, any senior vice president or any vice president or a managing
director and in the name of the Owner Participant or Lessee, as the case
may be. The Owner Trustee may accept a copy of a resolution of the Board of
Directors or Executive Committee of Lessee, certified by the secretary or
any assistant secretary of Lessee as duly adopted and in full force and
effect, as conclusive evidence that such resolution has been duly adopted
by said Board or Committee and that the same is in full force and effect.
As to any fact or matter the manner of ascertainment of which is not
specifically described herein, the Owner Trustee may for all purposes
hereof rely on a certificate signed by a person purporting to be the
chairman of the board, the president, any executive vice president, any
senior vice president or any vice president or a managing director of
Lessee, as to such fact or matter, and such certificate shall constitute
full protection to the Owner Trustee for any action taken or omitted to be
taken by it in good faith in reliance thereon. In the administration of
trusts hereunder, the Owner Trustee may execute any of the trusts or powers
hereof and perform its powers and duties hereunder directly or through
agents or attorneys and may, at the expense of the Trust Estate, consult
with counsel, accountants and other skilled persons to be selected and
employed by it. The Owner Trustee shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the advice or
opinion of any such counsel, accountants or other skilled persons and the
Owner Trustee shall not be liable for the negligence of any such agent,
attorney, counsel, accountant or other skilled person appointed by it with
due care hereunder.
SECTION 6.06 NOT ACTING IN INDIVIDUAL CAPACITY. In acting
hereunder, the Owner Trustee acts solely as trustee and not in its
individual capacity except as otherwise expressly provided herein; and,
subject to the terms of the Participation Agreement and the Trust
Indenture, all persons, other than the Owner Participant, as provided
herein, having any claim against the Owner Trustee by reason of the
transactions contemplated hereby shall look only to the Trust Estate for
payment or satisfaction thereof.
SECTION 6.07 FEES; COMPENSATION. Except as provided in Section
5.03 or 7.01 hereof, the Owner Trustee agrees that it shall have no right
against the Owner Participant or (subject to the provisions of the Trust
Indenture) the Trust Estate for any fee as compensation for its services
hereunder.
SECTION 6.08 TAX RETURNS. The Owner Trustee shall be
responsible for the keeping of all appropriate books and records relating
to the receipt and disbursement of all monies under this Trust Agreement or
any agreement contemplated hereby. The Owner Participant shall be
responsible for causing to be prepared and filed all income tax returns
required to be filed by the Owner Participant. The Owner Trustee shall be
responsible for causing to be prepared, at the request and expense of the
Owner Participant, all income tax returns required to be filed with respect
to the trust created hereby and shall execute and file such returns. The
Owner Participant or the Owner Trustee, as the case may be, upon request,
will furnish the Owner Trustee or the Owner Participant, as the case may
be, with all such information as may be reasonably required from the Owner
Participant or the Owner Trustee, as the case may be, in connection with
the preparation of such income tax returns.
ARTICLE VII
INDEMNIFICATION OF OWNER TRUSTEE
BY OWNER PARTICIPANT
SECTION 7.01 OWNER PARTICIPANT TO INDEMNIFY OWNER TRUSTEE. The
Owner Participant hereby agrees, whether or not any of the transactions
contemplated hereby shall be consummated, to assume liability for, and
hereby indemnify, protect, save and keep harmless FSB in its individual
capacity and its successors, assigns, legal representatives, agents and
servants, from and against any and all liabilities, obligations, losses,
damages, penalties, taxes (excluding any taxes payable by FSB in its
individual capacity on or measured by any compensation received by FSB in
its individual capacity for its services hereunder or in connection with
the transactions contemplated by the Operative Documents), claims, actions,
suits, costs, expenses or disbursements (including, without limitation,
reasonable ongoing fees of the Owner Trustee, reasonable legal fees and
expenses, and including without limitation any liability of an owner, any
strict liability and any liability without fault) of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against FSB in
its individual capacity (whether or not also indemnified against by Lessee
under the Lease or under the Participation Agreement or also indemnified
against by any other person but only to the extent not otherwise paid or
reimbursed by Lessee or such other person) in any way relating to or
arising out of this Trust Agreement or any of the Operative 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, possession, use, operation,
condition, sale, return or other disposition of the Aircraft (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 Estate or
the action or inaction of the Owner Trustee or FSB in its individual
capacity hereunder, except (a) in the case of willful misconduct or gross
negligence on the part of the Owner Trustee or FSB in its individual
capacity in the performance or nonperformance of its duties hereunder or
(b) those resulting from the inaccuracy of any representation or warranty
of FSB in its individual capacity (or from the failure of FSB in its
individual capacity to perform any covenant) in Section 6.03 hereof, in
Section 6.03 of the Trust Indenture or, with respect to representations or
warranties of FSB in its individual capacity only, in Section 4 of the
Lease, in Sections 7(a), 7(b), 7(f), 7(g), 7(m), 7(o), 7(p), 7(s) or 7(u)
of the Participation Agreement or in any of the other Operative Documents
or (c) as may result from a breach by FSB in its individual capacity of its
covenants in the last sentence of Section 5.04 hereof or (d) in the case of
the failure to use ordinary care on the part of the Owner Trustee or FSB in
its individual capacity in the disbursement of funds. The indemnities
contained in this Section 7.01 extend to FSB only in its individual
capacity and shall not be construed as indemnities of the Trust Indenture
Estate or the Trust Estate (except to the extent, if any, that FSB in its
individual capacity has been reimbursed by the Trust Indenture Estate or
the Trust Estate for amounts covered by the indemnities contained in this
Section 7.01). The indemnities contained in this Section 7.01 shall survive
the termination of this Trust Agreement. In addition, if necessary, FSB in
its individual capacity shall be entitled to indemnification from the Trust
Estate, subject to the Lien of the Trust Indenture, for any liability,
obligation, loss, damage, penalty, tax, claim, action, suit, cost, expense
or disbursement indemnified against pursuant to this Section 7.01 to the
extent not reimbursed by Lessee, the Owner Participant or others, but
without releasing any of them from their respective agreements of
reimbursement; and to secure the same FSB in its individual capacity shall
have a Lien on the Trust Estate, subject to the Lien of the Trust
Indenture, which shall be prior to any interest therein of the Owner
Participant. The payor of any indemnity under this Article VII shall be
subrogated to any right of the person indemnified in respect of the matter
as to which such indemnity was paid.
ARTICLE VIII
TRANSFER OF THE OWNER PARTICIPANT'S INTEREST
SECTION 8.01 TRANSFER OF INTERESTS. All provisions of Section
7(k) of the Participation Agreement shall (with the same force and effect
as if set forth in full, mutatis, in this Section 8.01) be applicable to
any assignment, conveyance or other transfer by any Owner Participant of
its right, title or interest in and to the Participation Agreement, the
Trust Estate or this Trust Agreement. In addition to the provisions of
Section 7(k) of the Participation Agreement: (i) any such transfer shall
be effected by a written agreement, in form and substance reasonably
satisfactory to the Owner Trustee in its individual capacity, among such
transferee, its transferor and the Owner Trustee, which shall provide that
such transferee thereby becomes a party to, and beneficiary of, this Trust
Agreement and an Owner Participant for all purposes hereof and that such
transferee assumes all of the obligations of its transferor under this
Trust Agreement; and (ii) so long as the Lease shall be in effect or any
Equipment Notes remain unpaid, such transferee and its transferor shall
have complied with all of the terms of Section 7(k) of the Participation
Agreement.
ARTICLE IX
SUCCESSOR OWNER TRUSTEES; CO-TRUSTEES
SECTION 9.01 RESIGNATION OF OWNER TRUSTEE; APPOINTMENT OF
SUCCESSOR. (a) Resignation or Removal. The Owner Trustee or any successor
Owner Trustee (i) shall resign if required to do so pursuant to Section
7(a) of the Participation Agreement and (ii) may resign at any time without
cause by giving at least sixty (60) days' prior written notice to the Owner
Participant, the Indenture Trustee (so long as the Lien of the Trust
Indenture has not been fully discharged) and Lessee (so long as the Lease
is in effect), such resignation to be effective upon the acceptance of
appointment by the successor Owner Trustee under Section 9.01(b) hereof. In
addition, the Owner Participant may at any time remove the Owner Trustee
without cause by a notice in writing delivered to the Owner Trustee, the
Indenture Trustee (so long as the Lien of the Trust Indenture has not been
fully discharged) and Lessee (so long as the Lease is in effect), such
removal to be effective upon the acceptance of appointment by the successor
Owner Trustee under Section 9.01(b) hereof. In the case of the resignation
or removal of the Owner Trustee, the Owner Participant may appoint a
successor Owner Trustee by an instrument signed by the Owner Participant.
If a successor Owner Trustee shall not have been appointed within thirty
(30) days after such notice of resignation or removal, the Owner Trustee,
the Owner Participant, Lessee or the Indenture Trustee may apply to any
court of competent jurisdiction to appoint a successor Owner Trustee to act
until such time, if any, as a successor shall have been appointed as above
provided. Any successor Owner Trustee so appointed by such court shall
immediately and without further act be superseded by any successor Owner
Trustee appointed as above provided.
(b) Execution and Delivery of Documents, etc. Any successor
Owner Trustee, however appointed, shall execute and deliver to the
predecessor Owner Trustee and the Owner Participant an instrument accepting
such appointment, and thereupon such successor Owner Trustee, without
further act, shall become vested with all the estates, properties, rights,
powers, duties and trusts of the predecessor Owner Trustee in the trusts
hereunder with like effect as if originally named the Owner Trustee herein;
but nevertheless, upon the written request of such successor Owner Trustee,
such predecessor Owner Trustee shall execute and deliver an instrument
transferring to such successor Owner Trustee, upon the trusts herein
expressed, all the estates, properties, rights, powers and trusts of such
predecessor Owner Trustee, and such predecessor Owner Trustee shall duly
assign, transfer, deliver and pay over to such successor Owner Trustee all
monies or other property then held by such predecessor Owner Trustee upon
the trusts herein expressed. Upon the appointment of any successor Owner
Trustee hereunder, the predecessor Owner Trustee will execute such
documents as are provided to it by such successor Owner Trustee and will
take such further actions as are requested of it by such successor Owner
Trustee as are reasonably required to cause registration of the Aircraft
included in the Trust Estate to be transferred upon the records of the
Federal Aviation Administration, or other governmental authority having
jurisdiction, into the name of the successor Owner Trustee.
(c) Qualification. Any successor Owner Trustee, however
appointed, shall be a Citizen of the United States without making use of a
voting trust, voting powers agreement or similar arrangement and shall also
be a bank or trust company organized under the laws of the United States or
any state thereof having a combined capital and surplus of at least
$100,000,000, if there be such an institution willing, able and legally
qualified to perform the duties of the Owner Trustee hereunder upon
reasonable or customary terms.
(d) Merger, etc. Any corporation into which the Owner Trustee
may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which
the Owner Trustee shall be a party, or any corporation to which
substantially all the corporate trust business of the Owner Trustee may be
transferred, shall, subject to the terms of Section 9.01(c) hereof, be the
Owner Trustee hereunder without further act.
SECTION 9.02 CO-TRUSTEES AND SEPARATE TRUSTEES. If at any time
it shall be necessary or prudent in order to conform to any law of any
jurisdiction in which all or any part of the Trust Estate is located, or
the Owner Trustee being advised by counsel shall determine that it is so
necessary or prudent in the interest of the Owner Participant or the Owner
Trustee, or the Owner Trustee shall have been directed to do so by the
Owner Participant, the Owner Trustee and the Owner Participant shall
execute and deliver an agreement supplemental hereto and all other
instruments and agreements necessary or proper to constitute another bank
or trust company or one or more persons (any and all of which shall be a
Citizen of the United States without making use of a voting trust, voting
powers agreement or similar arrangement) approved by the Owner Trustee and
the Owner Participant, either to act as co-trustee, jointly with the Owner
Trustee, or to act as separate trustee hereunder (any such co-trustee or
separate trustee being herein sometimes referred to as an "additional
trustee").
Every additional trustee hereunder shall, to the extent permitted
by law, be appointed and act, and the Owner Trustee and its successors
shall act, subject to the following provisions and conditions:
(A) all powers, duties, obligations and rights conferred upon
the Owner Trustee in respect of the custody, control and management of
monies, or documents authorized to be delivered hereunder or under the
Participation Agreement shall be exercised solely by the Owner
Trustee;
(B) all other rights, powers, duties and obligations conferred
or imposed upon the Owner Trustee shall be conferred or imposed upon
and exercised or performed by the Owner Trustee and such additional
trustee jointly, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
(including the holding of title to the Trust Estate) the Owner Trustee
shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations shall be
exercised and performed by such additional trustee;
(C) no power given to, or which it is provided hereby may be
exercised by, any such additional trustee shall be exercised hereunder
by such additional trustee, except jointly with, or with the consent
in writing of, the Owner Trustee;
(D) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder;
(E) the Owner Participant, at any time, by an instrument in
writing may remove any such additional trustee; and
(F) no appointment of, or action by, any additional trustee will
relieve the Owner Trustee of any of its obligations under, or
otherwise affect any of the terms of, the Trust Indenture or affect
the interests of the Indenture Trustee or the holders of the Equipment
Notes in the Trust Indenture Estate.
ARTICLE X
SUPPLEMENTS AND AMENDMENTS
TO TRUST AGREEMENT AND OTHER DOCUMENTS
SECTION 10.01 SUPPLEMENTS AND AMENDMENTS. (a) Supplements and
Amendments. This Trust Agreement may not be amended, supplemented or
otherwise modified except by an instrument in writing signed by the Owner
Trustee and the Owner Participant. Subject to Section 10.02 hereof and the
first sentence of Section 9 of the Participation Agreement, the Owner
Trustee will execute any amendment, supplement or other modification of
this Trust Agreement or of any other Operative Document to which the Owner
Trustee is a party which it is requested to execute by the Owner
Participant, except that the Owner Trustee shall not execute any such
amendment, supplement or other modification which, by the express
provisions of any of the above documents, requires the consent of any other
party unless such consent shall have been obtained.
(b) Delivery of Amendments and Supplements to Certain Parties. A
signed copy of each amendment or supplement referred to in Section 10.01(a)
hereof shall be delivered by the Owner Trustee to Lessee, the Indenture
Trustee and each holder of a Equipment Note.
SECTION 10.02 DISCRETION AS TO EXECUTION OF DOCUMENTS. Prior to
executing any document required to be executed by it pursuant to the terms
of Section 10.01 hereof, the Owner Trustee shall be entitled to receive an
opinion of its counsel to the effect that the execution of such document is
authorized hereunder. If in the opinion of the Owner Trustee any such
document adversely affects any right, duty, immunity or indemnity in favor
of the Owner Trustee hereunder or under any other Operative Document to
which the Owner Trustee is a party, the Owner Trustee may in its discretion
decline to execute such document.
SECTION 10.03 ABSENCE OF REQUIREMENTS AS TO FORM. It shall not
be necessary for any written request furnished pursuant to Section 10.01
hereof to specify the particular form of the proposed documents to be
executed pursuant to such Section, but it shall be sufficient if such
request shall indicate the substance thereof.
SECTION 10.04 DISTRIBUTION OF DOCUMENTS. Promptly after the
execution by the Owner Trustee of any document entered into pursuant to
Section 10.01 hereof, the Owner Trustee shall mail, by certified mail,
postage prepaid, a conformed copy thereof to the Owner Participant, but the
failure of the Owner Trustee to mail such conformed copy shall not impair
or affect the validity of such document.
SECTION 10.05 NO REQUEST NEEDED AS TO LEASE SUPPLEMENT AND TRUST
SUPPLEMENT. No written request pursuant to Section 10.01 hereof shall be
required to enable the Owner Trustee to enter into the Lease Supplement
covering the Aircraft with Lessee pursuant to the terms of the Lease and
Section 3.01 hereof and the Trust Supplement pursuant to the terms of the
Trust Indenture and Section 3.01 hereof.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 TERMINATION OF TRUST AGREEMENT. This Trust
Agreement and the trusts created hereby shall be of no further force or
effect upon the earlier of (a) both the final discharge of the Trust
Indenture pursuant to Section 10.01 thereof and the sale or other final
disposition by the Owner Trustee of all property constituting part of the
Trust Estate and the final distribution by the Owner Trustee of all monies
or other property or proceeds constituting part of the Trust Estate in
accordance with Article IV hereof, provided that at such time Lessee shall
have fully complied with all of the terms of the Lease and the
Participation Agreement or (b) twenty-one years less one day after the
death of the last survivor of all of the descendants of the grandparents of
Joseph P. Kennedy living on the date of the earliest execution of this
Trust Agreement by any party hereto; otherwise this Trust Agreement and the
trusts created hereby shall continue in full force and effect in accordance
with the terms hereof.
SECTION 11.02 OWNER PARTICIPANT HAS NO LEGAL TITLE IN TRUST
ESTATE. The Owner Participant shall not have legal title to any part of the
Trust Estate. No transfer, by operation of law or otherwise, of any right,
title and interest of the Owner Participant in and to the Trust Estate
hereunder shall operate to terminate this Trust Agreement or the trusts
hereunder or entitle any successors or transferees of the Owner Participant
to an accounting or to the transfer of legal title to any part of the Trust
Estate.
SECTION 11.03 ASSIGNMENT, SALE, ETC. OF AIRCRAFT. Any
assignment, sale, transfer or other conveyance of its interest in the
Aircraft by the Owner Trustee made pursuant to the terms hereof or of the
Lease or the Participation Agreement shall bind the Owner Participant and
shall be effective to transfer or convey all right, title and interest of
the Owner Trustee and the Owner Participant 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 assignment,
sale, transfer or conveyance or as to the application of any sale or other
proceeds with respect thereto by the Owner Trustee.
SECTION 11.04 TRUST AGREEMENT FOR BENEFIT OF CERTAIN PARTIES
ONLY. Except for the terms of Section 7(k) of the Participation Agreement
incorporated in Article VIII hereof and except as otherwise provided in
Articles IX and X hereof, nothing herein, whether expressed or implied,
shall be construed to give any Person other than the Owner Trustee and the
Owner Participant any legal or equitable right, remedy or claim under or in
respect of this Trust Agreement; but this Trust Agreement shall be held to
be for the sole and exclusive benefit of the Owner Trustee and the Owner
Participant.
SECTION 11.05 NOTICES; CONSENT TO JURISDICTION. (a) All notices,
demands, instructions and other communications required or permitted to be
given to or made upon any party hereto shall be in writing and shall be
personally delivered or sent by registered or certified mail, postage
prepaid, or by telecopier, or by prepaid courier service, and shall be
deemed to be given for purposes of this Trust Agreement on the day that
such writing is delivered or sent to the intended recipient thereof in
accordance with the provisions of this Section 11.05(a). Unless otherwise
specified in a notice sent or delivered in accordance with the foregoing
provisions of this Section 11.05(a), notices, demands, instructions and
other communications in writing shall be given to or made upon the
respective parties hereto at their respective addresses (or to their
respective telecopier numbers) as follows: (A) if to Lessee, the Owner
Trustee, the Loan Participants, the Indenture Trustee or the Owner
Participant, to the respective addresses set forth below the signatures of
such parties on the signature page of the Participation Agreement, or (B)
if to a Subsequent Owner Participant, addressed to such Subsequent Owner
Participant at such address as such Subsequent Owner Participant shall have
furnished by notice to the parties hereto or (C) if to any subsequent
Certificate Holder, addressed to such Certificate Holder at its address set
forth in the Equipment Note register maintained pursuant to Section 2.07 of
the Trust Indenture.
(b) Each of the parties hereto (A) hereby irrevocably submits
itself to the non-exclusive jurisdiction of the United States District
Court for the Southern District of New York and to the non-exclusive
jurisdiction of the Supreme Court of the State of New York, New York
County, for the purposes of any suit, action or other proceeding arising
out of this Trust Agreement, the Participation Agreement, the Lease, the
Tax Indemnity Agreement or any other Operative Document, the subject matter
of any thereof or any of the transactions contemplated hereby or thereby
brought by any party or parties thereto, or their successors or assigns,
and (B) hereby waives, and agrees not to assert, by way of motion, as a
defense, or otherwise, in any such suit, action or proceeding, to the
extent permitted by applicable law, that the suit, action or proceeding is
brought in an inconvenient forum, that the venue of the suit, action or
proceeding is improper, or that the Participation Agreement, the Lease, the
Tax Indemnity Agreement or any other Operative Document or the subject
matter of any thereof or any of the transactions contemplated hereby or
thereby may not be enforced in or by such courts.
SECTION 11.06 SEVERABILITY. Any provision hereof 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 11.07 WAIVERS, ETC. No term or provision hereof may be
changed, waived, discharged or terminated orally, but only by an instrument
in writing entered into in compliance with the terms of Article X hereof;
and any waiver of the terms hereof shall be effective only in the specific
instance and for the specific purpose given.
SECTION 11.08 COUNTERPARTS. This Trust Agreement may be executed
by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same instrument.
SECTION 11.09 BINDING EFFECT, ETC. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Owner Trustee and its successors and assigns, and the Owner Participant,
its successors and, to the extent permitted by Article VIII hereof, its
assigns. Any request, notice, direction, consent, waiver or other
instrument or action by the Owner Participant shall bind its successors and
assigns. Any Owner Participant which shall cease to have any ownership
interest shall thereupon cease to be a party hereto or an Owner Participant
for any reason and shall have no further obligations hereunder.
SECTION 11.10 HEADINGS; REFERENCES. The headings of the various
Articles and Sections herein are for convenience of reference only and
shall not define or limit any of the terms or provisions hereof.
SECTION 11.11 GOVERNING LAW. THIS TRUST AGREEMENT SHALL IN ALL
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF UTAH, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE.
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
[OWNER PARTICIPANT]
BY ____________________________
Name:
Title:
FIRST SECURITY BANK,
NATIONAL ASSOCIATION
BY _____________________________
Name:
Title:
Exhibit 4(a)(xix)
US Airways, Inc. Trust No. N___ U__
[FORM OF FRENCH PLEDGE AGREEMENT - LEASED AIRCRAFT]
FRENCH PLEDGE AGREEMENT
THIS PLEDGE is made on this _____ day of __________, _____ (this "Pledge")
BETWEEN:
(1) First Security Bank, National Association, a national banking
association having its principal place of business at 79 South
Main Street, 3rd Floor, Salt Lake City, Utah 84111 U.S.A.,
acting not in its individual capacity but solely as Owner
Trustee under the Trust Agreement (hereinafter referred to as
the "Pledgor"); and __________
(2) State Street Bank and Trust Company of Connecticut, National
Association, a national banking association having its
principal place of business at 225 Asylum Street, Goodwin
Square, Hartford, Connecticut 06103, U.S.A., acting not in its
individual capacity but solely as Indenture Trustee under the
Trust Indenture (hereinafter referred to as the "Pledgee").
RECITALS
(A) Pursuant to the terms of the Trust Indenture, the Pledgor has,
inter alia, assigned to the Pledgee by way of collateral
security certain of its right, interest, claims and demands in
and to the Secured Documents (as hereinafter defined).
(B) The Pledgor and the Pledgee wish to create a pledge under
French law of the right, interest, claims and demands of the
Pledgor in and to the
Secured Documents.
NOW THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:
1. DEFINITIONS
Capitalized terms used herein without definition have the
respective meanings ascribed to them in the Trust Indenture
(whether set out therein or incorporated by reference).
"Indenture Documents" means the Trust Indenture, the
Participation Agreement, the Equipment Notes and the Lease.
"Trust Indenture" means the Trust Indenture and Security
Agreement, dated as of August __, 1999 and made between the
Pledgor and the Pledgee.
"Secured Documents" means the Purchase Agreement Assignment and
the Consent and Agreement.
2. PLEDGE
In order to assure the due performance by the Pledgor of the
Secured Obligations and in order to secure the payment of all
amounts due and owing by the Pledgor in connection therewith
(whether of principal, interest or other amounts), the Pledgor
hereby grants and pledges to the Pledgee, all of the Pledgor's
right, title and interest in and to the Secured Documents and
to all payments or proceeds (other than Excluded Payments) to
be received by the Pledgor and all rights of the Pledgor to
enforce such payments under all of the Secured Documents.
It is understood that this Pledge is granted as security for
the payment of:
(i) the principal amount of US$[ ] payable with
respect to [ ];
(ii) interest on the outstanding amount at the rate of [ ]%;
(iii) all other amounts payable by the Pledgor to the
Pledgee under the Indenture Documents; and
(iv) any expenses incurred in the enforcement of the payment
obligations and recovery of the sums payable under the
Indenture Documents.
3. NOTIFICATION
The Pledgor shall, in accordance with Article 2075 of the
French Civil Code, register a French translation of this Pledge
with the relevant French tax authorities ("recette des impots")
and shall give notice thereof by huissier to AVSA, S.A.R.L. and
Airbus Industrie G.I.E..
4. GOVERNING LAW
The Pledge is of a commercial nature and shall be governed by
the construed in accordance with French law.
IN WITNESS WHEREOF, the parties hereto have caused this Pledge
to be duly executed as of the day and year first above written.
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual capacity
but solely as Owner Trustee
By: _________________________________
Name:
Title:
` STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, not in its individual capacity
but solely as Indenture Trustee
By: ________________________________
Name:
Title:
Exhibit 4(a)(xx)
Owned Aircraft
Participation Agreement
N___U_
- ------------------------------------------------------------------------------
PARTICIPATION AGREEMENT
(N___U_)
Dated as of
--------- --, ----
By and Between
US AIRWAYS, INC.,
Owner
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity except
as expressly provided herein, but solely as
Pass Through Trustee under each of the
Pass Through Trust Agreements,
Subordination Agent and Indenture Trustee
-----------------------------
One Airbus A3__ Aircraft
U.S. Registration No. N___U_
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INDEX TO PARTICIPATION AGREEMENT
Page
SECTION 1. Definitions and Construction.................................2
SECTION 2. Participation by Pass Through Trustees in Financing
of the Aircraft..............................................2
(a) Participation by Pass Through Trustees on the
Delivery Date; Issuance of Equipment Notes...................2
(b) Owner's Notice of Delivery Date..............................3
(c) Closing......................................................3
(d) Postponement of Scheduled Delivery Date......................3
SECTION 3. [Reserved.]..................................................4
SECTION 4. Conditions Precedent.........................................4
(a) Conditions Precedent to Purchase of Equipment Notes..........4
(b) Conditions Precedent to the Obligations of Owner............10
SECTION 5. Extent of Interest of Note Holders..........................12
SECTION 6. Representations and Warranties of Owner; Indemnities........12
(a) Representations and Warranties..............................12
(b) General Indemnity...........................................15
SECTION 7. Representations, Warranties and Covenants...................19
(a) Securities Act..............................................19
(b) Reregistration..............................................19
(c) Quiet Enjoyment.............................................20
(d) Equipment Notes Acquired for Investment.....................20
(e) Owner Merger Covenant.......................................21
(f) Representations, Warranties and Covenants of
the Indenture Trustee.......................................22
(g) Confidentiality of Purchase Agreement.......................23
(h) Loan Participant Liens......................................23
(i) Indenture Trustee Liens.....................................24
(j) Further Assurances..........................................24
(k) Transfer of Equipment Notes.................................24
(l) Representations and Warranties of Pass Through Trustee......24
(m) Representations and Warranties of Subordination Agent.......26
SECTION 8. Reliance of Liquidity Provider..............................28
SECTION 9. Other Documents.............................................29
SECTION 10. Certain Covenants of Owner..................................29
(a) Further Assurances..........................................29
(b) Filings.....................................................29
SECTION 11. [Reserved.].................................................29
SECTION 12. Notices; Consent to Jurisdiction............................29
(a) Notices.....................................................29
(b) Consent to Jurisdiction.....................................30
SECTION 13. [Reserved.].................................................30
SECTION 14. Miscellaneous...............................................30
(a) Survival....................................................30
(b) Counterparts................................................31
(c) Amendments and Waivers......................................31
(d) Successors and Assigns......................................31
(e) Governing Law...............................................31
EXHIBITS
Exhibit A - Schedule of Countries Authorized for Reregistration
Exhibit B-1 - Form of Opinion of Skadden, Arps, Slate,
Meagher & Flom (Illinois), special counsel for Owner
Exhibit B-2 - Form of Opinion of Owner's Legal Department
Exhibit C - Form of Opinion of _____________________, special counsel
for the Manufacturer
Exhibit D - Form of Opinion of Crowe & Dunlevy, P.C., special FAA
Counsel
Exhibit E - Form of Opinion of Bingham Dana LLP, special counsel
for the Indenture Trustee
Exhibit F - Form of Opinion of Bingham Dana LLP, special
counsel for the Pass Through Trustee
Exhibit G - Form of Opinion of Bingham Dana LLP, special
counsel for the Subordination Agent
Owned Aircraft
Participation Agreement
N___U_
PARTICIPATION AGREEMENT
(N___U_)
THIS PARTICIPATION AGREEMENT (N___U_) dated as of _______
___, ____ (as amended, supplemented or otherwise modified from time to
time, this "Agreement") by and between US AIRWAYS, INC., a Delaware
corporation (together with its successors and permitted assigns, the
"Owner"), and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, a national banking association, not in its individual capacity
except as otherwise provided herein, but solely as pass through trustee
under each of three separate Pass Through Trust Agreements (in such
capacity, together with its successors and permitted assigns, the "Pass
Through Trustee"), subordination agent and trustee under the Intercreditor
Agreement (in such capacity, together with its successors and permitted
assigns, the "Subordination Agent"), and Indenture Trustee under the
Indenture (in such capacity, together with any successor indenture trustee,
the "Indenture Trustee");
W I T N E S S E T H:
WHEREAS, concurrently with the execution and delivery of
this Agreement, the Indenture Trustee and the Owner are entering into the
Indenture pursuant to which the Owner will issue to the Pass Through
Trustee for each Pass Through Trust Equipment Notes in three series, which
Equipment Notes are to be secured by the mortgage and security interests
created by the Owner in favor of the Indenture Trustee;
WHEREAS, concurrently with the execution and delivery of
this Agreement, Owner will execute and deliver an Indenture Supplement
covering the Aircraft, supplementing the Indenture;
WHEREAS, the proceeds from the issuance and sale of the Pass
Through Certificates by each Pass Through Trust will be applied in part by
the Pass Through Trustee on the Delivery Date to purchase from Owner, on
behalf of each Pass Through Trust, all of the Equipment Notes bearing the
same interest rate as the Pass Through
Certificates issued by such Pass Through Trust;
WHEREAS, on the Delivery Date for the Aircraft, Owner will
deliver an Indenture Supplement covering the Aircraft;
WHEREAS, pursuant to the terms of the Note Purchase
Agreement, the Pass Through Trustee will purchase from the Owner on the
Delivery Date, on behalf of each Pass Through Trust, all of the Equipment
Notes bearing the same interest rate as the Pass Through Certificates
issued by such Pass Through Trust;
WHEREAS, prior to the execution and delivery of this
Agreement, (i) the Liquidity Provider entered into three separate Liquidity
Facilities, one for the benefit of the holders of Pass Through Certificates
of each of the Class A Pass Through Trust, the Class B Pass Through Trust
and the Class C Pass Through Trust (each referenced on Schedule III
hereto), with the Subordination Agent, as agent for the Pass Through
Trustee on behalf of each such Pass Through Trust; and (ii) the Pass
Through Trustee, the Liquidity Provider and the Subordination Agent have
entered into the Intercreditor Agreement; and
WHEREAS, the Equipment Notes will be held by the
Subordination Agent pursuant to the Intercreditor Agreement on behalf of
the Pass Through Trusts.
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND CONSTRUCTION.
Capitalized terms used but not defined herein shall have the
respective meanings set forth or incorporated by reference, and shall be
construed and interpreted
in the manner described, in Annex A.
SECTION 2. PARTICIPATION BY PASS THROUGH TRUSTEES IN FINANCING OF
THE AIRCRAFT.
(a) Participation by Pass Through Trustees on the Delivery
Date; Issuance of Equipment Notes. Subject to the terms and conditions of
this Agreement, the Pass Through Trustee for each Pass Through Trust agrees
to make a secured loan to Owner on the Delivery Date to finance, in part,
the Owner's acquisition of the Aircraft by paying to Owner the aggregate
purchase price of the Equipment Notes being issued to such Pass Through
Trustee as set forth on Schedule II opposite the name of such Pass Through
Trust. The Pass Through Trustees shall make such payments to Owner on a
date to be designated pursuant to Section 2(b) but in no event later than
__________________, by transferring to the account of Owner at State Street
Bank and Trust Company of Connecticut, National Association, 225 Asylum
Street, Goodwin Square, Hartford, Connecticut 06103, ABA No. _________,
Account No. __________, Reference: US Airways, Inc. 1999-1 EETC/N___U_),
not later than 9:30 a.m., New York City time, on the Delivery Date in
immediately available funds in Dollars, the amount set forth opposite the
name of such Pass Through Trust on Schedule II hereto.
Upon the occurrence of the above transfers by the Pass
Through Trustee for each Pass Through Trust to Owner, Owner shall issue,
pursuant to Article II of the Indenture, to the Subordination Agent on
behalf of the Pass Through Trustee for each of the Pass Through Trusts,
Equipment Notes of the maturity and aggregate principal amount, bearing the
interest rate and for the purchase price set forth on Schedule II opposite
the name of such Pass Through Trust.
(b) Owner's Notice of Delivery Date. Owner agrees to give
the Indenture Trustee, the Pass Through Trustee and the Subordination Agent
at least one (1) Business Day written or facsimile notice prior to the
Delivery Date, which notice shall specify the amount of Equipment Notes to
be purchased by the Pass Through Trustees, the Delivery Date for the
Aircraft, the serial number of the Airframe and each Engine, and the United
States registration number for the Aircraft.
(c) Closing. The closing of the transactions referred to in
this Agreement shall take place commencing at 9:30 a.m. local time, on the
Delivery Date, at the offices of Skadden, Arps, Slate, Meagher & Flom LLP
in New York, New York.
(d) Postponement of Scheduled Delivery Date.
(i) If for any reason whatsoever the closing of the
transactions contemplated hereby is not consummated on the Delivery
Date provided for pursuant to Section 2(b) (the "Scheduled Delivery
Date"), the closing shall be deemed adjourned to the next Business
Day or to such other Business Day on or prior to _______________ as
Owner shall specify by written notice to the Pass Through Trustee
and the Indenture Trustee.
(ii) If the closing fails to occur on the Scheduled Delivery
Date, Owner shall cause the Indenture Trustee to promptly return to
the Pass Through Trustees any funds provided by any such Pass
Through Trustee, together with interest or income earned thereon.
(iii) If the closing fails to occur on the Scheduled
Delivery Date and funds are not returned, as provided by clause
(ii) above, to each Pass Through Trustee that made funds available,
Owner shall use reasonable efforts to cause the Indenture Trustee
to invest, at the risk of Owner, the funds received by it from such
Pass Through Trustees in Cash Equivalents. Any such obligations
purchased by Owner, whether directly or through a repurchase
agreement, shall be held in trust by the Indenture Trustee for the
benefit of the respective Pass Through Trustees that provided such
funds.
(iv) If the closing fails to occur on the Scheduled Delivery
Date, unless Owner shall cause the Indenture Trustee to return all
funds to the Pass Through Trustee by 2:00 p.m., New York City time,
on the Scheduled Delivery Date, Owner shall reimburse each Pass
Through Trustee that has made funds available pursuant to this
Section 2 for the loss of the use of its funds an amount equal to
the excess, if any, of (x) interest at the Debt Rate on the amount
of such funds for the period from and including the Scheduled
Delivery Date to but excluding the actual Delivery Date or, if
earlier, the day on which such Pass Through Trustee's funds are
returned if such return is made by 2:00 p.m., New York City time
(or to but excluding the next following Business Day if such return
is not made by such time) over (y) any amount paid to such Pass
Through Trustee in respect of interest or income earned by Owner
pursuant to clause (iii) above.
(v) On the Delivery Date or on the date funds are required
to be returned to the Pass Through Trustees pursuant to clause (ii)
above, Owner shall reimburse the Pass Through Trustees that
provided funds which are invested by Owner pursuant to this
subsection (d) for any losses incurred on such investments. All
income and profits on the investment of such funds shall be for the
respective accounts of such Pass Through Trustee, and Owner shall
not be liable for failure to invest such funds, except for its own
negligence or willful misconduct.
SECTION 3. [RESERVED.]
SECTION 4. CONDITIONS PRECEDENT.
(a) Conditions Precedent to Purchase of Equipment Notes. It
is agreed that the obligations of the Indenture Trustee, the Subordination
Agent and the Pass Through Trustee on behalf of each Pass Through Trust to
participate in the transaction contemplated hereby on the Delivery Date are
subject to the fulfillment to the satisfaction of each party (or waiver by
such party), prior to or on the Delivery Date of the following conditions
precedent:
(i) At least one (1) Business Day prior to the Delivery
Date, each of the parties hereto shall have received the Delivery
Notice pursuant to Section 2(b).
(ii) On the Delivery Date, no change shall have occurred
after the date of the execution and delivery of this Agreement in
applicable law or regulations or guidelines or interpretations
thereof by appropriate regulatory authorities which would make it a
violation of law or regulations or guidelines for the Pass Through
Trustee to make its Commitment available in accordance with Section
2.
(iii) The following documents shall have been duly
authorized, executed and delivered by the respective party or
parties thereto, shall each be satisfactory in form and substance
to the Indenture Trustee, the Pass Through Trustee and the
Subordination Agent and shall be in full force and effect and
executed counterparts shall have been delivered to the Indenture
Trustee, the Pass Through Trustee and the Subordination Agent, or
their respective counsel, provided that only the Subordination
Agent on behalf of each Pass Through Trustee shall receive an
executed original of such Pass Through Trustee's respective
Equipment Note and provided, further, that an excerpted copy of the
Purchase Agreement shall only be delivered to and retained by the
Indenture Trustee, which copy may be inspected by the Indenture
Trustee if and only if there shall occur and be continuing an Event
of Default:
(1) an excerpted copy of the Purchase Agreement
(insofar as it relates to the Aircraft);
(2) the Indenture;
(3) the Indenture Supplement;
(4) the Equipment Notes;
(5) the FAA Bill of Sale;
(6) the Bill of Sale;
(7) the Purchase Agreement Assignment;
(8) the Consent and Agreement; and
(9) the French Pledge Agreement.
In addition, the Pass Through Trustee shall have
received executed counterparts or conformed copies of the following
documents:
(1) each of the Pass Through Trust Agreements;
(2) the Intercreditor Agreement; and
(3) the Liquidity Facility for each of the Class A,
Class B and Class C Pass Through Trusts.
(iv) A Uniform Commercial Code financing statement or
statements covering all the security interests created by or
pursuant to the Granting Clause of the Indenture that are not
covered by the recording system established by the Transportation
Code shall have been executed and delivered by Owner, and
arrangements satisfactory to the Indenture Trustee shall have been
made for the filing of such financing statement or statements in
all places necessary or advisable, and any additional Uniform
Commercial Code financing statements deemed advisable by the Pass
Through Trustee shall have been executed and delivered by Owner and
arrangements satisfactory to the Indenture Trustee shall have been
made for the filing of such financing statements.
(v) The Indenture Trustee, the Pass Through Trustee and the
Subordination Agent shall have received the following, in each case
in form and substance satisfactory to it (except it shall not be a
condition to the obligation of any such party that it receive a
certificate or other document required to be delivered by it):
(A) (1) an incumbency certificate of Owner as to the person
or persons authorized to execute and deliver the Operative
Documents to which Owner is a party and any other documents
to be executed on behalf of Owner in connection with the
transactions contemplated hereby and the signatures of such
person or persons;
(2) a copy of the resolutions of the board of directors
of Owner or Owner's executive committee, certified by the
Secretary or an Assistant Secretary of Owner, duly
authorizing the transactions contemplated hereby and the
execution and delivery of each of the documents required to
be executed and delivered on behalf of Owner in connection
with the transactions contemplated hereby; and
(3) a copy of the certificate of incorporation of Owner,
certified by the Secretary of State of the State of
Delaware, a copy of the by-laws of Owner certified by the
Secretary or Assistant Secretary of Owner, and a certificate
or other evidence from the Secretary of State of the State
of Delaware, dated as of a date shortly prior to the
Delivery Date, as to the due incorporation and good standing
of Owner in such state.
(B) (1) an incumbency certificate of the Indenture Trustee
as to the person or persons authorized to execute and
deliver the Operative Documents to which the Indenture
Trustee is a party and any other documents to be executed on
behalf of the Indenture Trustee in connection with the
transactions contemplated hereby and the signatures of such
person or persons;
(2) a copy of the resolutions of the board of directors
of the Indenture Trustee, certified by the Secretary or an
Assistant Secretary of the Indenture Trustee, duly
authorizing the transactions contemplated hereby and the
execution and delivery of each of the documents required to
be executed and delivered on behalf of the Indenture Trustee
in connection with the transactions contemplated hereby;
(3) a copy of the articles of association of the
Indenture Trustee certified by the Comptroller of the
Currency, a copy of the by-laws of the Indenture Trustee
certified by the Secretary or an Assistant Secretary of the
Indenture Trustee, and a certificate or other evidence from
the Comptroller of the Currency, dated as of a date shortly
prior to the Delivery Date, as to the existence of the
Indenture Trustee under the laws of the United States of
America; and
(4) a certificate signed by an authorized officer of the
Indenture Trustee, dated the Delivery Date, certifying that
the representations and warranties contained herein of the
Indenture Trustee are correct in all material respects as
though made on and as of the Delivery Date, except to the
extent that such representations and warranties relate
solely to an earlier date (in which case such
representations and warranties are correct on and as of such
earlier date).
(vi) All appropriate action required to have been taken
prior to the Delivery Date in connection with the transactions
contemplated by this Agreement shall have been taken by the Federal
Aviation Administration, or any governmental or political agency,
subdivision or instrumentality of the United States, and all
orders, permits, waivers, authorizations, exemptions and approvals
of such entities required to be in effect on the Delivery Date in
connection with the transactions contemplated by this Agreement
shall have been issued, and all such orders, permits, waivers,
authorizations, exemptions and approvals shall be in full force and
effect on the Delivery Date.
(vii) The Indenture Trustee, the Pass Through Trustee and
the Subordination Agent shall have received a certificate signed by
an authorized officer of Owner to the effect that:
(1) the Aircraft has been duly certified by the
Federal Aviation Administration as to type and has a current
certificate of airworthiness;
(2) the Indenture and the Indenture Supplement
covering the Aircraft shall have been duly filed for
recordation (or shall be in the process of being so duly
filed for recordation) with the Federal Aviation
Administration;
(3) the representations and warranties contained
herein of Owner are correct in all material respects as
though made on and as of the Delivery Date, except to the
extent that such representations and warranties relate
solely to an earlier date (in which case such
representations and warranties were correct on and as of
such earlier date); and
(4) the conditions to the purchase of the Equipment
Notes by the Pass Through Trustees under the Pass Through
Documents have been duly satisfied or waived in accordance
with their respective terms.
(viii) In the case of the Pass Through Trustees, the
conditions specified in Section 3 of the Note Purchase Agreement
shall have been satisfied or
waived.
(ix) The Indenture Trustee, the Pass Through Trustee and the
Subordination Agent shall have received, addressed to each such
party, and reasonably satisfactory as to scope and substance to
each addressee thereof, opinions dated the Delivery Date
substantially in the form of Exhibit B-1 hereto from Skadden, Arps,
Slate, Meagher & Flom (Illinois), special counsel for Owner, and an
opinion dated the Delivery Date substantially in the form of
Exhibit B-2 hereto from Owner's legal department.
(x) The Pass Through Trustee and the Indenture Trustee shall
have received, addressed to the Pass Through Trustee, the Indenture
Trustee and Owner and reasonably satisfactory as to scope and
substance to the Pass Through Trustee, an opinion dated the
Delivery Date substantially in the form of Exhibit C hereto from
Clifford Chance, with respect to the Manufacturer Documents.
(xi) [Reserved.]
(xii) [Reserved.]
(xiii) The Indenture Trustee, the Pass Through Trustee and
the Subordination Agent shall have received, addressed to each such
party, and reasonably satisfactory as to scope and substance to
each addressee thereof, an opinion dated the Delivery Date
substantially in the form of Exhibit D hereto from Crowe & Dunlevy,
P.C., special FAA counsel.
(xiv) The Pass Through Trustee and the Subordination Agent
shall have received, addressed to each such party, and reasonably
satisfactory as to scope and substance to each addressee thereof,
an opinion dated the Delivery Date substantially in the form of
Exhibit E from Bingham Dana LLP, special counsel for the Indenture
Trustee.
(xv) [Reserved.]
(xvi) The Indenture Trustee, the Pass Through Trustee and
the Subordination Agent shall have received an insurance
certificate together with an independent insurance broker's report,
in form and substance reasonably satisfactory to the Indenture
Trustee, as to the due compliance with the terms of Section 7.04 of
the Indenture relating to insurance with respect to the Aircraft.
(xvii) [Reserved.]
(xviii) No action or proceeding shall have been instituted
nor shall governmental action be threatened before any court or
governmental agency, nor shall any order, judgment or decree have
been issued or proposed to be issued by any court or governmental
agency at the time of the Delivery Date to set aside, restrain,
enjoin or prevent the completion and consummation of this Agreement
or the transactions contemplated hereby.
(xix) [Reserved.]
(xx) No Event of Default has occurred and is continuing and
no Event of Loss has occurred with respect to the Airframe or any
Engine.
(xxi) The Indenture Trustee and the Subordination Agent
shall have received (A) a certificate signed by an authorized
officer of the Pass Through Trustee, dated the Delivery Date,
certifying that the representations and warranties contained herein
of the Pass Through Trustee are correct in all material respects as
though made on and as of the Delivery Date, except to the extent
that such representations and warranties relate solely to an
earlier date (in which case such representations and warranties are
correct on and as of such earlier date), (B) an opinion dated the
Delivery Date substantially in the form of Exhibit F hereto
addressed to each such party of Bingham Dana LLP, special counsel
for the Pass Through Trustee, and reasonably satisfactory as to
scope and substance to each addressee thereof, and (C) such other
documents and evidence with respect to the Pass Through Trustee as
it may reasonably request in order to establish the due
consummation of the transactions contemplated by this Agreement,
the taking of all necessary corporate action in connection
therewith and compliance with the conditions herein set forth.
(xxii) The Indenture Trustee and the Pass Through Trustee
shall have received, addressed to each such party, and reasonably
satisfactory as to scope and substance, to each addressee thereof,
an opinion dated the Delivery Date substantially in the form of
Exhibit G hereto from Bingham Dana LLP, special counsel for the
Subordination Agent.
Promptly upon the recording of the Indenture and the
Indenture Supplement covering the Aircraft pursuant to the Transportation
Code, Owner will cause Crowe & Dunlevy, P.C., special FAA counsel in
Oklahoma City, Oklahoma, to deliver to the Pass Through Trustee, the
Indenture Trustee and Owner an opinion as to the due recording of the
Indenture and such Indenture Supplement and the lack of filing of any
intervening documents with respect to the Aircraft.
(b) Conditions Precedent to the Obligations of Owner. It is
agreed that the obligations of Owner to enter into the Operative Documents
on the Delivery Date are all subject to the fulfillment to the satisfaction
of Owner prior to the Delivery Date of the following conditions precedent:
(i) All appropriate action required to have been taken on or
prior to the Delivery Date in connection with the transactions
contemplated by this Agreement shall have been taken by the Federal
Aviation Administration, or any governmental or political agency,
subdivision or instrumentality of the United States, and all
orders, permits, waivers, exemptions, authorizations and approvals
of such entities required to be in effect on the Delivery Date in
connection with the transactions contemplated by this Agreement
shall have been issued, and all such orders, permits, waivers,
exemptions, authorizations and approvals shall be in full force and
effect on the Delivery Date.
(ii) The conditions specified in Sections 4(a)(ii) shall
have been satisfied.
(iii) Those documents described in Section 4(a)(iii) shall
have been duly authorized, executed and delivered by the respective
party or parties thereto (other than Owner) in the manner specified
in Section 4(a)(iii), shall each be satisfactory in form and
substance to Owner, shall be in full force and effect on the
Delivery Date, and an executed counterpart of each thereof (other
than the Equipment Notes) shall have been delivered to Owner or its
special counsel.
(iv) Owner shall have received (A) each certificate referred
to in Section 4(a)(v) (other than the certificate referred to in
clause (A) thereof), (B) the certificate referred to in Section
4(a)(xxi)(A), and (C) such other documents and evidence with
respect to the Pass Through Trustee as Owner or its special counsel
may reasonably request in order to establish the due consummation
of the transactions contemplated by this Agreement, the taking of
all corporate proceedings in connection therewith and compliance
with the conditions herein set forth.
(v) Owner shall have received the opinions set forth in
Sections 4(a)(x), 4(a)(xiii), 4(a)(xiv), 4(a)(xxi)(B) and
4(a)(xxii) in each case addressed to Owner and dated the Delivery
Date and in each case in scope and substance reasonably
satisfactory to Owner and its special counsel.
(vi) No action or proceeding shall have been instituted nor
shall governmental action be threatened before any court or
governmental agency, nor shall any order, judgment or decree have
been issued or proposed to be issued by any court or governmental
agency at the time of the Delivery Date to set aside, restrain,
enjoin or prevent the completion and consummation of this Agreement
or the transactions contemplated hereby.
(vii) No change shall have occurred after the date of the
execution and delivery of this Agreement in applicable law or
regulations or guidelines or interpretations by appropriate
regulatory authorities which would make it a violation of law or
regulations or guidelines for Owner to enter into any transaction
contemplated by the Operative Documents.
(viii) Owner shall have been paid by the Pass Through
Trustees for the issuance of the Equipment Notes.
SECTION 5. EXTENT OF INTEREST OF NOTE HOLDERS. No Note Holder shall
have any further interest in, or other right with respect to, the mortgage
and security interests created by the Indenture when and if the principal
of and interest on all Equipment Notes held by such holder and all other
sums payable to such holder hereunder, under the Indenture and under such
Equipment Notes shall have been paid in full.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF OWNER; INDEMNITIES.
(a) Representations and Warranties. Owner represents and
warrants to the Pass Through Trustee, the Indenture Trustee, each Loan
Participant and the Subordination Agent that:
(i) Owner is a corporation duly organized, validly existing
and in good standing under the laws of the state of its
incorporation, has the corporate power and authority to own or hold
under lease its properties, has, or had on the respective dates of
execution thereof, the corporate power and authority to enter into
and perform its obligations under the Owner Documents, the Pass
Through Trust Agreements and the other Operative Documents to which
it is a party, and is duly qualified to do business as a foreign
corporation in each state in which its operations or the nature of
its business requires other than failures to so qualify which would
not have a material adverse effect on the condition (financial or
otherwise), business or properties of Owner and its subsidiaries
considered as one enterprise;
(ii) Owner is a Certificated Air Carrier, and its chief
executive office (as such term is used in Article 9 of the Uniform
Commercial Code in effect in the State of Virginia) is located at
Arlington, Virginia;
(iii) the execution and delivery by Owner of Owner
Documents, the Pass Through Trust Agreements and each other
Operative Document to which Owner is a party, and the performance
of the obligations of Owner under Owner Documents, the Pass Through
Trust Agreements and each other Operative Document to which Owner
is a party, have been duly authorized by all necessary corporate
action on the part of Owner, do not require any stockholder
approval, or approval or consent of any trustee or holder of any
material indebtedness or material obligations of Owner, except such
as have been duly obtained and are in full force and effect, and do
not contravene any law, governmental rule, regulation or order
binding on Owner or the certificate of incorporation or by-laws of
Owner, or contravene the provisions of, or constitute a default
under, or result in the creation of any Lien (other than Permitted
Liens) upon the property of Owner under, any indenture, mortgage,
contract or other agreement to which Owner is a party or by which
it may be bound or affected which contravention, default or Lien,
individually or in the aggregate, would be reasonably likely to
have a material adverse effect on the condition (financial or
otherwise), business or properties of Owner and its subsidiaries
considered as one enterprise; provided, that insofar as the
representations and warranties set forth in this Section 6(a)(iii)
apply to the prohibited transaction rules of ERISA and Section 4975
of the Code, such representations and warranties are based upon and
subject to the truth and accuracy of the representations and
warranties made or deemed made by each purchaser of Pass Through
Certificates issued by a Pass Through Trust;
(iv) neither the execution and delivery by Owner of Owner
Documents, the Pass Through Trust Agreements or any other Operative
Document to which Owner is a party, nor the performance of the
obligations of Owner under Owner Documents, the Pass Through Trust
Agreements or the other Operative Documents to which Owner is a
party, requires the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action in
respect of, the Department of Transportation, the FAA, or any other
Federal, state or foreign governmental authority having
jurisdiction over Owner, other than (A) the registration of the
Pass Through Certificates under the Securities Act and under the
securities laws of any state in which the Pass Through Certificates
may be offered for sale if the laws of such state require such
action, (B) the qualification of the Pass Through Trust Agreements
under the Trust Indenture Act of 1939, as amended, pursuant to an
order of the Securities and Exchange Commission, (C) the orders,
permits, waivers, exemptions, authorizations and approvals of the
regulatory authorities having jurisdiction over the operation of
the Aircraft by Owner required to be obtained on or prior to the
Delivery Date, which orders, permits, waivers, exemptions,
authorizations and approvals have been, or on the Delivery Date
will be, duly obtained and are, or on the Delivery Date will be, in
full force and effect, (D) the registrations and filings referred
to in Section 6(a)(vi), and (E) authorizations, consents,
approvals, actions, notices and filings required to be obtained,
taken, given or made either only after the date hereof or the
failure of which to obtain, take, give or make would not be
reasonably likely to have a material adverse effect on the
condition (financial or otherwise), business or properties of Owner
and its subsidiaries considered as one enterprise;
(v) this Agreement, each of the other Owner Documents and
the Pass Through Trust Agreements to which Owner is a party
constitute (or, in the case of documents to be executed on the
Delivery Date, will constitute) the legal, valid and binding
obligations of Owner enforceable against Owner in accordance with
their respective terms, except as the same may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws affecting the rights of
creditors generally and by general principles of equity, whether
considered in a proceeding at law or in equity;
(vi) except for (A) the filing for recording pursuant to the
Transportation Code of the Indenture and the Indenture Supplement
attached thereto and made a part thereof and (B) the filing of
financing statements (and continuation statements at periodic
intervals) with respect to the security interests created by such
documents under the Uniform Commercial Code of Virginia and such
other states as may be specified in the opinion furnished pursuant
to Section 4(a)(ix) hereof, no further filing or recording of any
document (including any financing statement in respect thereof
under Article 9 of the Uniform Commercial Code of any applicable
jurisdiction) or other action is necessary under the laws of the
United States of America or any State thereof in order to perfect
the security interest in favor of the Indenture Trustee in the
Aircraft (with respect to such portion of the Aircraft as is
covered by the recording system established by the FAA pursuant to
49 U.S.C. Section 44107);
(vii) neither Owner nor any of its Affiliates has directly
or indirectly offered any interest in the Equipment Notes or the
Pass Through Certificates for sale to any Person other than in a
manner permitted by the Securities Act and by the rules and
regulations thereunder;
(viii) Owner is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended;
(ix) no event has occurred and is continuing which
constitutes a Default or an Event of Default;
(x) no event has occurred and is continuing which
constitutes an Event of Loss or would constitute an Event of Loss
with the lapse of time;
(xi) Owner is solvent and has no intention or belief that it
is about to incur debts beyond its ability to pay as they mature;
(xii) none of the proceeds from the issuance of the
Equipment Notes will be used directly or indirectly by Owner to
purchase or carry any "margin security" as such term is defined in
Regulation U of the Board of Governors of the Federal Reserve
System;
(xiii) except as may have been disclosed in Owner's reports
filed with the Securities and Exchange Commission, there are no
pending or threatened actions or proceedings that individually or
in the aggregate which could be expected to have a material adverse
effect on the condition (financial or otherwise), business or
properties of Owner and its subsidiaries considered as one
enterprise; and
(xiv) Owner has good title (subject to filing and
recordation of the FAA Bill of Sale with the FAA) to the Aircraft,
free and clear of all Liens, except the Lien of the Trust Indenture
and Liens permitted by clauses (iv) (solely for Taxes not yet due
but excluding any such Taxes being contested) and (v) (solely
securing obligations that are not yet due but excluding any such
obligations being contested) of Section 7.01 of the Trust
Indenture.
(b) General Indemnity. Owner hereby agrees to indemnify each
Indemnitee against, and agrees to protect, save and keep harmless each of
them from (whether or not the transactions contemplated herein or in any of
the other Operative Documents are consummated), any and all expenses
imposed on, incurred by or asserted against any Indemnitee, in any way
relating to, based on or arising out of (A) the execution, delivery and
performance of the Operative Documents or the Pass Through Documents and
the transactions contemplated thereby; (B) the manufacture, purchase,
acceptance or rejection of the Airframe or any Engine or Parts; (C) the
Aircraft (or any portion thereof) or any engine installed on the Airframe
or any airframe on which an Engine is installed whether or not arising out
of the manufacture, purchase, registration, reregistration, financing,
refinancing, ownership, delivery, nondelivery, inspection, lease, sublease,
possession, storage, use or non-use, operation, maintenance, overhaul,
modification, alteration, condition, replacement, repair, substitution,
sale, return or other disposition of the Aircraft including, without
limitation, any violation of law relating to the Aircraft (including
environmental laws), latent or other defects, whether or not discoverable,
strict tort liability and any claim for patent, trademark or copyright
infringement; or (D) the offer or sale of any interest in the Equipment
Notes or the Pass Through Certificates (or other evidence of the debt
relating to the Aircraft) on the Delivery Date or in connection with a
refinancing in accordance with the terms hereof (including any violation of
securities laws or ERISA); provided, that the foregoing indemnity shall not
extend to an Indemnitee with respect to any Expense to the extent such
Expense is attributable to one or more of the following: (1) any
representation or warranty by such Indemnitee in the Operative Documents or
the Pass Through Documents being incorrect, or (2) the failure by such
Indemnitee to perform or observe any of its agreements, covenants or
conditions in any of the Operative Documents or the Pass Through Documents,
or (3) the willful misconduct or the gross negligence of such Indemnitee,
or (4) (A) in the case of any Indemnitee, the offer, sale or other
disposition (voluntary or involuntary) by such Indemnitee of all or any
part of its interest in the Airframe or any Engine, (B) in the case of a
Note Holder, the offer, sale or other disposition (voluntary or
involuntary) by such Note Holder of all or any part of its interest in any
Equipment Note or (C) in the case of any Indemnitee, the offer, sale or
other disposition by such Indemnitee of all or any part of such
Indemnitee's interest in the Operative Documents, or (5) any Tax, or (6) in
the case of the Indenture Trustee in its individual and trust capacities,
failure on the part of the Indenture Trustee to distribute in accordance
with the Indenture any amounts distributable by it thereunder, or (7) in
the case of any Pass Through Trustee or the Subordination Agent, failure on
the part of such Pass Through Trustee or the Subordination Agent to
distribute in accordance with the Intercreditor Agreement and the Pass
Through Trust Agreement amounts received and distributable thereunder, or
(8) the authorization or giving or withholding of any future amendments,
supplements, waivers or consents with respect to any of the Operative
Documents which amendments, supplements, waivers or consents (a) are not or
were not requested by Owner or (b) are not occasioned by a specific
requirement of the Operative Documents, or (9) any amount which any
Indemnitee expressly agrees to pay under any Operative Document or any
amount which is expressly stated to be an expense that is not reimbursable
by Owner under the Operative Documents, or (10) any amount that is an
ordinary and usual operating or overhead expense of any Indemnitee (it
being understood out-of-pocket expenses payable to third parties do not
constitute "ordinary and usual operating and overhead expenses"), or (11)
any amounts attributable to any Lien which such Indemnitee is required to
remove pursuant to the terms of the Operative Documents or the Pass Through
Documents, or (12) any loss of tax benefits or increases in tax liability
or (13) any amount that constitutes principal of, or interest or premium on
the Equipment Notes.
Owner's indemnity obligation to an Indemnitee under this
Section 6(b) shall equal the amount which, after taking into account any
Tax imposed upon the receipt or accrual of the amounts payable under this
Section 6(b) and any tax benefits realized by such Indemnitee as a result
of the accrual or payment of such Expense shall equal the amount of the
Expense indemnifiable under this Section 6(b).
If any Indemnitee shall realize a tax savings by reason of
any Tax paid or indemnified by Owner pursuant to this Section 6(b) (whether
such tax savings shall be by means of a foreign tax credit, depreciation or
cost recovery deduction or otherwise) and such savings are not otherwise
taken into account in computing such payment or indemnity such Indemnitee
shall pay to Owner an amount equal to the lesser of (i) the amount of such
tax savings, plus any additional tax savings recognized as the result of
any payment made pursuant to this sentence, when, as if, and to the extent,
realized or (ii) the amount of all payments pursuant to this Section 6(b)
by Owner to such Indemnitee (less any payments previously made by such
Indemnitee to Owner pursuant to this Section 6(b)) (and the excess, if any,
of the amount described in clause (i) over the amount described in clause
(ii) shall be carried forward and applied to reduce pro tanto any
subsequent obligations of Owner to make payments to such Indemnitee
pursuant to this Section 6(b)).
If a claim is made against an Indemnitee involving one or
more Expenses and such Indemnitee has notice thereof, such Indemnitee shall
promptly after receiving such notice give notice of such claim to Owner;
provided that the failure to give such notice shall not affect the
obligations of Owner hereunder except to the extent Owner is prejudiced by
such failure or Owner's indemnification obligations are increased as a
result of such failure. If no Event of Default shall have occurred and be
continuing, Owner shall be entitled, at its sole cost and expense, acting
through counsel reasonably acceptable to the respective Indemnitee, (A) in
any judicial or administrative proceeding that involves solely a claim for
one or more expenses, to assume responsibility for and control thereof, (B)
in any judicial or administrative proceeding involving a claim for one or
more expenses and other claims related or unrelated to the transactions
contemplated by the Operative Documents, to assume responsibility for and
control of such claim for Expenses to the extent that the same may be and
is severed from such other claims (and such Indemnitee shall use its best
efforts to obtain such severance), and (C) in any other case, to be
consulted by such Indemnitee with respect to judicial proceedings subject
to the control of such Indemnitee and to be allowed, at Owner's sole
expense, to participate therein. Notwithstanding any of the foregoing to
the contrary, Owner shall not be entitled to assume responsibility for and
control of any such judicial or administrative proceedings if such
proceedings will involve a material risk of the sale, forfeiture or loss
of, or the creation of any Lien (other than a Permitted Lien) on, the
Aircraft, the Indenture Estate or any part thereof unless in such an event
Owner shall have posted a bond or other security satisfactory to the
relevant Indemnitees in respect to such risk. The Indemnitee may
participate at its own expense and with its own counsel in any judicial
proceeding controlled by Owner pursuant to the preceding provisions.
The affected Indemnitee shall supply Owner with such
information reasonably requested by Owner as is necessary or advisable for
Owner to control or participate in any proceeding to the extent permitted
by this Section 6(b). Such Indemnitee shall not enter into a settlement or
other compromise with respect to any Expense without the prior written
consent of Owner, which consent shall not be unreasonably withheld or
delayed, unless such Indemnitee waives its right to be indemnified with
respect to such Expense under this Section 6(b).
Owner shall supply the Indemnitee with such information
reasonably requested by the Indemnitee as is necessary or advisable for the
Indemnitee to control or participate in any proceeding to the extent
permitted by this Section 6(b).
Upon payment of any Expense pursuant to this Section 6(b),
Owner, without any further action, shall be subrogated to any claims the
Indemnitee may have relating thereto. The Indemnitee agrees to give such
further assurances or agreements and to cooperate with Owner to permit
Owner to pursue such claims, if any, to the extent reasonably requested by
Owner.
If an Indemnitee is reimbursed, in whole or in part, with
respect to any Expense paid by Owner hereunder, it will promptly pay the
amount refunded, including interest received thereon (but not an amount in
excess of the amount Owner or any of its insurers has paid in respect of
such Expense pursuant to this Section 6(b)) over to Owner.
To the extent permitted by applicable law, interest at the
Base Rate plus one percent (1.0%) shall be paid, on demand, on any amount
or indemnity not paid when due pursuant to this Section 6 until the same
shall be paid. Such interest shall be paid in the same manner as the unpaid
amount in respect of which such interest is due.
Any amount which is payable to Owner by any Person pursuant
to this Section 6(b) shall not be paid to Owner if an Event of Default has
occurred and is continuing or if any payment is due and owing by Owner to
such Person under any Operative Document. Any such amount shall be held by
such Person (Owner hereby granting a security interest in such amount to
such Person) and, if an Event of Default shall have occurred and be
continuing, shall be applied against Owner's obligations hereunder to such
Person as and when due (and, to the extent that Owner has no obligations
hereunder to such Person, such amount shall be paid to Owner). At such time
as there shall not be continuing any such Event of Default or there shall
not be due and owing any such payment, such amount shall be paid to Owner
to the extent not previously applied in accordance with the immediately
preceding sentence.
(c) Special Indemnity. If a Class C Special Indemnity Event
shall be continuing as of any Payment Date, Owner shall pay on such Payment
Date to the Pass Through Trustee on behalf of the US Airways Pass Through
Trust 1999-1C the amount which has accrued through such Payment Date in
accordance with the following sentence and which remains unpaid on such
Payment Date (such amount, the "Class C Special Indemnity Payment"). The
Class C Special Indemnity Payment shall accrue at a daily rate equal to the
Multiplier, in effect from time to time during the period from the Payment
Date immediately preceding such Payment Date to such Payment Date,
multiplied by the aggregate principal amount of the Series C Equipment
Notes outstanding on such date divided by 360. The Pass Through Trustee
agrees that it will accept and receive the Class C Special Indemnity
Payment on behalf of the US Airways Pass Through Trust 1999-1C and that it
will distribute the Class C Special Indemnity Payment in accordance with
the Trust Agreement for the US Airways Pass Through Trust 1999-1C.
SECTION 7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) Securities Act. Each Loan Participant represents and
warrants that neither it nor anyone acting in its behalf has offered any
Equipment Notes for sale to, or solicited any offer to buy any Equipment
Note from, any person or entity other than in a manner in compliance with,
and which does not require registration under, the Securities Act or the
rules and regulations thereunder.
(b) Reregistration. The Indenture Trustee and each Loan
Participant agree that, so long as no Event of Default shall have occurred
and be continuing, Owner may elect to effect a change in registration of
the Aircraft, at Owner's cost and expense, so long as the country of
registry of the Aircraft is a country listed on Exhibit A. Upon the request
of Owner, Exhibit A shall be amended from time to time to include any other
country which the Indenture Trustee has determined, acting reasonably,
would provide substantially equivalent protection for the rights of lenders
in similar transactions as provided under the laws of the United States of
America and the states thereof. In order for Owner to effect a change in
the country of registry of the Aircraft, Owner shall deliver to the
Indenture Trustee the following:
(I) an Officer's Certificate certifying that (A) the insurance
or self-insurance required by Section 7.04 of the Indenture
shall be in full force and effect at the time of such change
in registration after giving effect to such change in
registration, (B) all indemnities in favor of the Indenture
Trustee under any Operative Document afford the Indenture
Trustee substantially the same protection as provided prior
to such change of registry, (C) the Lien of the Indenture in
favor of the Indenture Trustee will continue as a first
priority lien following such change of registry, (D) such
change will not result in the imposition of, or increase in
the amount of, any Tax for which Owner is not required to
indemnify, or is not then willing to enter into a binding
agreement to indemnify, the Note Holders or the Indenture
Trustee, pursuant to this Agreement, and (E) that the new
country of registry imposes aircraft maintenance standards
not materially different from those of any Permitted Foreign
Air Authority; and
(II) a favorable opinion (subject to customary exceptions) of
counsel (reasonably acceptable to the Indenture Trustee)
addressed to the Indenture Trustee, from counsel of
recognized reputation qualified in the laws of the relevant
jurisdiction to the effect that: (A) it is not necessary,
solely as a consequence of such change in registration and
without giving effect to any other activity of the Indenture
Trustee (or any Affiliate thereof) for the Indenture Trustee
to register or qualify to do business in such jurisdiction;
(B) unless Owner shall have agreed to provide insurance
covering the risk of requisition of use of such Aircraft by
the government of such jurisdiction so long as such Aircraft
is registered under the laws of such jurisdiction, the laws
of such jurisdiction require fair compensation by the
government of such jurisdiction payable in currency freely
convertible into Dollars for the loss of use of such
Aircraft in the event of the requisition by such government
of such use; and (C) after giving effect to such change in
registration, the Lien of the Indenture on Owner's right,
title and interest in and to the Aircraft shall continue as
a valid and duly perfected first priority security interest
and all filing, recording or other action necessary to
protect the same shall have been accomplished (or, if such
opinion cannot be given at the time of such proposed change
in registration because such change in registration is not
yet effective, (1) the opinion shall detail what filing,
recording or other action is necessary, and (2) the
Indenture Trustee shall have received a certificate from
Owner that all possible preparations to accomplish such
filing, recording and other action shall have been done, and
such filing, recording and other action shall be
accomplished and a supplemental opinion to that effect shall
be delivered to the Indenture Trustee on or prior to the
effective date of such change in registration).
Owner shall pay all reasonable costs, expenses, fees,
recording and registration taxes, including the reasonable fees and
expenses of counsel to the Indenture Trustee, and other charges in
connection with any such change in registration.
(c) Quiet Enjoyment. Each Loan Participant and each of the
Indenture Trustee, the Subordination Agent and the Pass Through Trustee
covenants and agrees that, so long as no Event of Default shall have
occurred and be continuing and the Indenture has not been duly declared in
default, such Person shall not (and shall not permit any Affiliate or other
Person claiming by, through or under it to) interfere with Owner's
continued possession, use and operation of, and quiet enjoyment of, the
Aircraft.
(d) Equipment Notes Acquired for Investment. Each Loan
Participant represents and warrants that the Equipment Note to be issued to
it pursuant to the Indenture is being acquired by it for investment and not
with a view to resale or distribution (it being understood that such Loan
Participant may pledge or assign as security its interest in each Equipment
Note issued to it), except that the Loan Participants may sell, transfer or
otherwise dispose of any Equipment Note or any portion thereof, or grant
participations therein, in a manner which in itself does not require
registration under the Securities Act.
(e) Owner Merger Covenant. Owner will not consolidate with
or merge into any other corporation or convey, transfer or lease
substantially all of its assets as an entirety to any Person unless:
(i) the corporation formed by such consolidation or into
which Owner is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of Owner as an
entirety shall be (i) organized and validly existing under the laws
of the United States of America or any state thereof or the
District of Columbia, (ii) a "citizen of the United States" as
defined in 49 U.S.C. Section 40102(a)(15), as amended, and (iii) a
Certificated Air Carrier, if and so long as such status is a
condition of entitlement to the benefits of Section 1110 of the
Bankruptcy Code with respect to the Lien of the Indenture;
(ii) the corporation formed by such consolidation or into
which Owner is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of Owner as an
entirety shall execute and deliver to Indenture Trustee an
agreement in form and substance reasonably satisfactory to the
Indenture Trustee a duly authorized, valid, binding and enforceable
agreement containing an assumption by such successor corporation or
Person of the due and punctual performance and observance of each
covenant and condition of the Operative Documents to which Owner is
a party to be performed or observed by Owner;
(iii) immediately after giving effect to such transaction,
no Event of Default shall have occurred and be continuing; and
(iv) Owner shall have delivered to the Indenture Trustee a
certificate signed by the President, any Executive Vice President,
any Senior Vice President or any Vice President and by the
Secretary or an Assistant Secretary of Owner, and an opinion of
counsel (which may be Owner's General Counsel, Deputy General
Counsel, Assistant General Counsel or Associate General Counsel)
reasonably satisfactory to the Indenture Trustee, each stating that
such consolidation, merger, conveyance, transfer or lease and the
assumption agreement mentioned in clause (ii) above comply with
this Section 7(e) and that all conditions precedent herein provided
for relating to such transaction have been complied with.
Upon any such consolidation or merger or any such
conveyance, transfer or lease of substantially all of the assets of Owner
as an entirety in accordance with this Section 7(e), the successor
corporation or Person formed by such consolidation or into which Owner is
merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of,
Owner under this Agreement with the same effect as if such successor
corporation or Person had been named as Owner herein. No such conveyance,
transfer or lease of substantially all of the assets of Owner as an
entirety shall have the effect of releasing Owner or any successor
corporation or Person which shall theretofore have become such in the
manner prescribed in this Section 7(e) from its liability in respect of any
Operative Document to which it is a party.
(f) Representations, Warranties and Covenants of the
Indenture Trustee. State Street Bank and Trust Company of Connecticut,
National Association represents, warrants (as of the Delivery Date) and
covenants, in its individual capacity, to Owner, the Pass Through Trustee
and the Subordination Agent, as follows:
(i) the Indenture Trustee is a national banking association
duly incorporated, validly existing and in good standing under the
laws of the United States, is a Citizen of the United States
(without making use of any voting trust, voting powers agreement or
similar arrangement), will notify promptly all parties to this
Agreement if in its reasonable opinion its status as a Citizen of
the United States (without making use of any voting trust, voting
powers agreement or similar arrangement) is likely to change and
will resign as Indenture Trustee as provided in Section 9.02 of the
Indenture promptly after it obtains actual knowledge that it has
ceased to be such a Citizen of the United States (without making
use of a voting trust, voting powers agreement or similar
arrangement), and has the full corporate power, authority and legal
right under the laws of the State of Connecticut and the United
States pertaining to its banking, trust and fiduciary powers to
execute and deliver each of this Agreement, the Indenture and each
other Operative Document to which it is a party and to carry out
its obligations under this Agreement, the Indenture and each other
Operative Document to which it is a party and to authenticate the
Equipment Notes;
(ii) the execution and delivery by the Indenture Trustee of
the Indenture Trustee Documents and the authentication of the
Equipment Notes and the performance by the Indenture Trustee of its
obligations under the Indenture Trustee Documents have been duly
authorized by the Indenture Trustee and will not violate its
articles of association or by-laws or the provisions of any
indenture, mortgage, contract or other agreement to which it is a
party or by which it is bound;
(iii) this Agreement and each of the other Indenture Trustee
Documents constitute the legal, valid and binding obligations of
the Indenture Trustee enforceable against it in accordance with
their respective terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and by
general principles of equity, whether considered in a proceeding at
law or in equity;
(iv) there are no pending or, to its knowledge, threatened
actions or proceedings against the Indenture Trustee, either in its
individual capacity or as Indenture Trustee, before any court or
administrative agency which, if determined adversely to it, would
materially adversely affect the ability of the Indenture Trustee,
in its individual capacity or as Indenture Trustee as the case may
be, to perform its obligations under the Operative Documents to
which it is a party; and
(v) there are no Indenture Trustee Liens on the Aircraft.
(g) Confidentiality of Purchase Agreement. The Indenture
Trustee agrees for the benefit of the Seller, the Manufacturer and Owner
that it will not disclose or suffer to be disclosed the terms of the
Purchase Agreement to any third party except (A) as may be required by any
applicable statute, court or administrative order or decree or governmental
ruling or regulation or to any regulatory authorities having official
jurisdiction over them, (B) in connection with the financing of the
Aircraft and the other transactions contemplated by the Operative Documents
(including any transfer of Equipment Notes (including by way of
participation or assignment of an interest, provided such participant or
assignee agrees to hold such terms confidential to the same extent as
herein provided) and any exercise of remedies under the Indenture), (C)
with the prior written consent of the Manufacturer, the Seller and Owner or
(D) to the Indenture Trustee's counsel or special counsel, independent
insurance brokers or other agents who agree to hold such information
confidential.
(h) Loan Participant Liens. Each Loan Participant covenants
and agrees that it shall not cause or permit to exist a Loan Participant
Lien attributable to it with respect to the Aircraft. Each Loan Participant
agrees that it will promptly, at its own expense, take such other action as
may be necessary duly to discharge such Loan Participant Lien attributable
to it. Each Loan Participant agrees to make restitution to Owner for any
actual diminution of the assets of Owner resulting from such Loan
Participant Lien attributable to it.
(i) Indenture Trustee Liens. State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity,
covenants and agrees that it shall not cause or permit to exist any
Indenture Trustee's Liens with respect to the Indenture Estate. State
Street Bank and Trust Company of Connecticut, National Association, in its
individual capacity, agrees that it will promptly, at its own expense, take
such action as may be necessary duly to discharge such Indenture Trustee's
Liens. State Street Bank and Trust Company of Connecticut, National
Association, in its individual capacity, agrees to make restitution to
Owner for any actual diminution of the assets of the Indenture Estate
resulting from such Indenture Trustee's Liens.
(j) Further Assurances. Owner, at its expense, will take, or
cause to be taken, such action with respect to the recording, filing,
re-recording and refiling of the Indenture, the Indenture Supplement and
any financing statements or other instruments as are necessary to maintain,
so long as the Indenture is in effect, the perfection of the security
interests created by the Indenture or will furnish to the Indenture Trustee
timely notice of the necessity of such action, together with such
instruments, in execution form, and such other information as may be
required to enable them to take such action. Owner will notify the
Indenture Trustee of any change in the location of its chief executive
office (as such term is used in Article 9 of the Uniform Commercial Code)
promptly after making such change or in any event within the period of time
necessary under applicable law to prevent the lapse of perfection (absent
refiling) of financing statements filed under the Operative Documents.
(k) Transfer of Equipment Notes. Each Loan Participant
hereby represents, warrants and agrees that it shall not transfer any
interest in any Equipment Note unless and until the transferee agrees in
writing (copies of which shall be provided by the Indenture Trustee to
Owner) to make the representations contemplated to be made by a Loan
Participant in this Agreement and to be bound by the terms of this
Agreement and the Indenture.
(l) Representations and Warranties of Pass Through Trustee.
The Pass Through Trustee represents and warrants to Owner, the Indenture
Trustee and the Subordination Agent, in its capacity as such and in its
individual capacity, as follows:
(i) the Pass Through Trustee is a national banking
association duly organized, validly existing and in good standing
under the laws of the United States, and has the full corporate
power, authority and legal right under the laws of the State of
Connecticut and the United States pertaining to its banking, trust
and fiduciary powers to execute and deliver each of the Pass
Through Trust Agreements, the Intercreditor Agreement and this
Agreement and to perform its obligations under the Pass Through
Trust Agreements, the Intercreditor Agreement and this Agreement;
(ii) this Agreement, each of the Pass Through Trust
Agreements and the Intercreditor Agreement have been duly
authorized, executed and delivered by the Pass Through Trustee;
this Agreement, each of the Pass Through Trust Agreements and the
Intercreditor Agreement constitute the legal, valid and binding
obligations of the Pass Through Trustee enforceable against it in
accordance with their respective terms, except as the same may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of creditors
generally and by general principles of equity, whether considered
in a proceeding at law or in equity;
(iii) none of the execution, delivery and performance by the
Pass Through Trustee of any of the Pass Through Trust Agreements,
the Intercreditor Agreement or this Agreement, the purchase by the
Pass Through Trustee of the Equipment Notes pursuant to this
Agreement, or the issuance of the Pass Through Certificates
pursuant to the Pass Through Trust Agreements, contravenes any law,
rule or regulation of the State of Connecticut or any United States
governmental authority or agency regulating the Pass Through
Trustee's banking, trust or fiduciary powers or any judgment or
order applicable to or binding on the Pass Through Trustee and does
not contravene or result in any breach of, or constitute a default
under, the Pass Through Trustee's articles of association or
by-laws or any agreement or instrument to which the Pass Through
Trustee is a party or by which it or any of its properties may be
bound;
(iv) neither the execution and delivery by the Pass Through
Trustee of any of the Pass Through Trust Agreements, the
Intercreditor Agreement or this Agreement, nor the consummation by
the Pass Through Trustee of any of the transactions contemplated
hereby or thereby, requires the consent or approval of, the giving
of notice to, the registration with, or the taking of any other
action with respect to, any Connecticut governmental authority or
agency or any Federal governmental authority or agency regulating
the Pass Through Trustee's banking, trust or fiduciary powers;
(v) there are no Taxes payable by the Pass Through Trustee
imposed by the State of Connecticut or any political subdivision or
taxing authority thereof in connection with the execution, delivery
and performance by the Pass Through Trustee of this Agreement, any
of the Pass Through Trust Agreements or the Intercreditor Agreement
(other than franchise or other taxes based on or measured by any
fees or compensation received by the Pass Through Trustee for
services rendered in connection with the transactions contemplated
by any of the Pass Through Trust Agreements), and there are no
Taxes payable by the Pass Through Trustee imposed by the State of
Connecticut or any political subdivision thereof in connection with
the acquisition, possession or ownership by the Pass Through
Trustee of any of the Equipment Notes (other than franchise or
other taxes based on or measured by any fees or compensation
received by the Pass Through Trustee for services rendered in
connection with the transactions contemplated by any of the Pass
Through Trust Agreements), and, assuming that the trusts created by
the Pass Through Trust Agreements will not be taxable as
corporations, but rather, each will be characterized either as a
grantor trust under subpart E, Part I, of Subchapter J of the Code
or as a partnership, such trusts will not be subject to any Taxes
imposed by the State of Connecticut or any political subdivision
thereof;
(vi) there are no pending or threatened actions or
proceedings against the Pass Through Trustee before any court or
administrative agency which individually or in the aggregate, if
determined adversely to it, would materially adversely affect the
ability of the Pass Through Trustee to perform its obligations
under this Agreement, the Intercreditor Agreement or any Pass
Through Trust Agreement;
(vii) except for the issue and sale of the Pass Through
Certificates contemplated hereby, the Pass Through Trustee has not
directly or indirectly offered any Equipment Note for sale to any
Person or solicited any offer to acquire any Equipment Notes from
any Person, nor has the Pass Through Trustee authorized anyone to
act on its behalf to offer directly or indirectly any Equipment
Note for sale to any Person, or to solicit any offer to acquire any
Equipment Note from any Person; and the Pass Through Trustee is not
in default under any Pass Through Trust Agreement; and
(viii) the Pass Through Trustee is not directly or
indirectly controlling, controlled by or under common control with
Owner.
(m) Representations and Warranties of Subordination Agent.
The Subordination Agent represents and warrants to Owner, the Indenture
Trustee and the Pass Through Trustee, in its capacity as such and in its
individual capacity, as
follows:
(i) the Subordination Agent is a national banking
association duly organized, validly existing and in good standing
under the laws of the United States, and has the full corporate
power, authority and legal right under the laws of the State of
Connecticut and the United States pertaining to its banking, trust
and fiduciary powers to execute and deliver this Agreement, the
Liquidity Facilities and the Intercreditor Agreement and to perform
its obligations under this Agreement, the Liquidity Facilities and
the Intercreditor Agreement;
(ii) this Agreement, each of the Liquidity Facilities and
the Intercreditor Agreement have been duly authorized, executed and
delivered by the Subordination Agent; this Agreement, each of the
Liquidity Facilities and the Intercreditor Agreement constitute the
legal, valid and binding obligations of the Subordination Agent
enforceable against it in accordance with their respective terms,
except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the rights of creditors generally and by general principles of
equity, whether considered in a proceeding at law or in equity;
(iii) none of the execution, delivery and performance by the
Subordination Agent of each of the Liquidity Facilities, the
Intercreditor Agreement or this Agreement contravenes any law, rule
or regulation of the State of Connecticut or any United States
governmental authority or agency regulating the Subordination
Agent's banking, trust or fiduciary powers or any judgment or order
applicable to or binding on the Subordination Agent and do not
contravene or result in any breach of, or constitute a default
under, the Subordination Agent's articles of association or by-laws
or any agreement or instrument to which the Subordination Agent is
a party or by which it or any of its properties may be bound;
(iv) neither the execution and delivery by the Subordination
Agent of any of the Liquidity Facilities, the Intercreditor
Agreement or this Agreement nor the consummation by the
Subordination Agent of any of the transactions contemplated hereby
or thereby requires the consent or approval of, the giving of
notice to, the registration with, or the taking of any other action
with respect to, any Connecticut governmental authority or agency
or any Federal governmental authority or agency regulating the
Subordination Agent's banking, trust or fiduciary powers;
(v) there are no Taxes payable by the Subordination Agent
imposed by the State of Connecticut or any political subdivision or
taxing authority thereof in connection with the execution, delivery
and performance by the Subordination Agent of this Agreement, any
of the Liquidity Facilities or the Intercreditor Agreement (other
than franchise or other taxes based on or measured by any fees or
compensation received by the Subordination Agent for services
rendered in connection with the transactions contemplated by the
Intercreditor Agreement or any of the Liquidity Facilities), and
there are no Taxes payable by the Subordination Agent imposed by
the State of Connecticut or any political subdivision thereof in
connection with the acquisition, possession or ownership by the
Subordination Agent of any of the Equipment Notes (other than
franchise or other taxes based on or measured by any fees or
compensation received by the Subordination Agent for services
rendered in connection with the transactions contemplated by the
Intercreditor Agreement or any of the Liquidity Facilities);
(vi) there are no pending or threatened actions or
proceedings against the Subordination Agent before any court or
administrative agency which individually or in the aggregate, if
determined adversely to it, would materially adversely affect the
ability of the Subordination Agent to perform its obligations under
this Agreement, the Intercreditor Agreement or any Liquidity
Facility;
(vii) the Subordination Agent has not directly or indirectly
offered any Equipment Note for sale to any Person or solicited any
offer to acquire any Equipment Notes from any Person, nor has the
Subordination Agent authorized anyone to act on its behalf to offer
directly or indirectly any Equipment Note for sale to any Person,
or to solicit any offer to acquire any Equipment Note from any
Person; and the Subordination Agent is not in default under any
Liquidity Facility; and
(viii) the Subordination Agent is not directly or indirectly
controlling, controlled by or under common control with Owner.
SECTION 8. RELIANCE OF LIQUIDITY PROVIDER. Each of the parties
hereto agrees and acknowledges that the Liquidity Provider shall be a third
party beneficiary of each of the representations, warranties and covenants
made herein by such party, and that the Liquidity Provider may rely on such
representations and warranties to the same extent as if such
representations and warranties were made to the Liquidity Provider
directly. Owner agrees and acknowledges that the Liquidity Provider shall
be a third party beneficiary of the indemnities contained in Section 6(b),
and may rely on such indemnities to the same extent as if such indemnities
were made to the Liquidity Provider directly.
SECTION 9. OTHER DOCUMENTS. So long as the Lien of the Indenture
has not been terminated, the Pass Through Trustee, the Subordination Agent
and the Indenture Trustee hereby agree for the benefit of Owner that
without Owner's consent, each such party will not amend any other provision
of any Operative Document or Pass Through Document in a manner adversely
affecting Owner. Each of the Indenture Trustee, the Subordination Agent and
the Pass Through Trustee agree to promptly furnish to Owner copies of any
supplement, amendment, waiver or modification of any of the Operative
Documents or Pass Through Documents to which Owner is not a party. Each
Loan Participant agrees that it will not take any action in respect of the
Indenture Estate except through the Indenture Trustee pursuant to the
Indenture or as otherwise permitted by the Indenture.
SECTION 10. CERTAIN COVENANTS OF OWNER. Owner covenants and agrees
with each of the Loan Participants and the Indenture Trustee, as follows:
(a) Further Assurances. Owner will cause to be done,
executed, acknowledged and delivered all and every such further acts,
conveyances and assurances as the Indenture Trustee shall reasonably
require for accomplishing the purposes of this Agreement and the other
Operative Documents; provided that any instrument or other document so
executed by Owner will not expand any obligations or limit any rights of
Owner in respect of the transactions contemplated by any Operative
Documents.
(b) Filings. Owner, at its expense, will cause the
Indenture, all supplements and amendments to the Indenture and this
Agreement to be promptly filed and recorded, or filed for recording, to the
extent permitted under the Transportation Code or required under any other
applicable law. Upon the execution and delivery of the Indenture, the
Indenture and the Indenture Supplement shall be filed for recording with
the Federal Aviation Administration.
SECTION 11. [RESERVED.]
SECTION 12. NOTICES; CONSENT TO JURISDICTION.
(a) Notices. All notices, demands, instructions and other
communications required or permitted to be given to or made upon any party
hereto shall be in writing and shall be personally delivered or sent by
registered or certified mail, postage prepaid, or by telecopier, or by
prepaid courier service, and shall be deemed to be given for purposes of
this Agreement on the day that such writing is delivered to the recipient
thereof in accordance with the provisions of this Section 12(a). Unless
otherwise specified in a notice sent or delivered in accordance with the
foregoing provisions of this Section 12(a), notices, demands, instructions
and other communications in writing shall be given to or made upon the
respective parties hereto at their respective addresses (or to their
respective telecopier numbers) as follows: (A) if to Owner, the Pass
Through Trustee, the Subordination Agent or the Indenture Trustee to the
respective addresses set forth below the signatures of such parties at the
foot of this Agreement, or (B) if to any subsequent Note Holder, addressed
to such Note Holder at its address set forth in the Equipment Note register
maintained pursuant to Section 2.07 of the Indenture.
(b) Consent to Jurisdiction. Each of the parties hereto (A)
hereby irrevocably submits itself to the non-exclusive jurisdiction of the
United States District Court for the Southern District of New York and to
the non-exclusive jurisdiction of the Supreme Court of the State of New
York, New York County, for the purposes of any suit, action or other
proceeding arising out of this Agreement or any other Operative Document,
the subject matter of any thereof or any of the transactions contemplated
hereby or thereby brought by any party or parties thereto, or their
successors or assigns, and (B) hereby waives, and agrees not to assert, by
way of motion, as a defense, or otherwise, in any such suit, action or
proceeding, to the extent permitted by applicable law, that the suit,
action or proceeding is brought in an inconvenient forum, that the venue of
the suit, action or proceeding is improper, or that this Agreement or any
other Operative Document or the subject matter of any thereof or any of the
transactions contemplated hereby or thereby may not be enforced in or by
such courts; provided, however that the foregoing shall not apply to the
right any party may have to seek removal of such suit, action or proceeding
to federal court or to seek consolidation of any separate actions, suits or
proceedings brought by one or more of the other parties in the same or
different jurisdictions. The agreement set forth in this Section 12(b) is
given solely for the benefit of the parties hereto and shall not inure to the
benefit of any other Person.
SECTION 13. [RESERVED.]
SECTION 14. MISCELLANEOUS.
(a) Survival. The representations, warranties, indemnities
and agreements of Owner, the Indenture Trustee, the Subordination Agent and
the Pass Through Trustee provided for in this Agreement or any other
Operative Document, and Owner's, the Indenture Trustee's, the Subordination
Agent's and the Pass Through Trustee's obligations under any and all
thereof, shall survive the making available of the respective Commitments
by the Pass Through Trustee, the transfer of any interest by any Loan
Participant in any Equipment Note or the Indenture Estate and the
expiration or other termination of this Agreement or any other Operative
Document.
(b) Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
(c) Amendments and Waivers. Neither this Agreement nor any
of the terms hereof may be terminated, amended, supplemented, waived or
modified, except by an instrument in writing signed by the party against
which the enforcement of the termination, amendment, supplement, waiver or
modification is sought; and no such termination, amendment, supplement,
waiver or modification shall be effective unless a signed copy thereof
shall have been delivered to the Indenture Trustee.
(d) Successors and Assigns. The terms of this Agreement
shall be binding upon, and inure to the benefit of, Owner and, subject to
the terms of this Agreement, its successors and permitted assigns, the Pass
Through Trustee and its successors as Pass Through Trustee (and any
additional trustee appointed) under any of the Pass Through Trust
Agreements, each Note Holder and its successors and registered assigns and
the Indenture Trustee and its successors as Indenture Trustee under the
Indenture. The terms of this Agreement shall inure to the benefit of the
Liquidity Provider, its successors and permitted assigns.
(e) Governing Law. THIS AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
(f) References. Unless otherwise specified, references in
this Agreement to Sections, Exhibits, Schedules and Annexes are references
to Sections, Exhibits, Schedules and Annexes herein or hereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
US AIRWAYS, INC.,
Owner
By:_______________________
Name:
Title:
Address: 2345 Crystal Drive
Arlington, Virginia 22227
STATE STREET BANK AND
TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
not in its individual capacity
except as otherwise provided herein,
but solely as Indenture Trustee
By: ____________________________
Name:
Title:
Address: 225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, not in its
individual capacity, except as otherwise
provided herein, but solely as Pass
Through Trustee
By:_______________________________
Name:
Title:
Address: 225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
STATE STREET BANK AND
TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, not in its
individual capacity, except as otherwise
provided herein, but solely as
Subordination Agent
By: _____________________________
Name:
Title:
Address: 225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
Owned Aircraft
Participation Agreement
N___U_
SCHEDULE I
NAMES AND ADDRESSES
Owner: US Airways, Inc.
U.S. MAIL
2345 Crystal Drive
Arlington, Virginia 22227
OVERNIGHT COURIER
Attn:
Telecopy No.: (___) ___-____
WIRE TRANSFER
ABA No._________________
Acct. No._________________
Indenture Trustee, State Street Bank and Trust Company of Connecticut,
Subordination Agent National Association
and Pass Through
Trustee: U.S. MAIL
225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
Attn: Corporate Trust Administration
Telecopy No: (860) 244-1889
with a copy to
State Street Bank and Trust Company
2 Avenue de Lafayette, 6th Floor
Boston, MA 02111
Attn: Corporate Trust Department
Ruth A. Smith
Telecopy No.: (617) 662-1461
OVERNIGHT COURIER
225 Asylum Street
Goodwin Square
Hartford, Connecticut 06103
Attn: Corporate Trust Administration
Telecopy No: (860) 244-1889
with a copy to
State Street Bank and Trust Company
2 Avenue de Lafayette, 6th Floor
Boston, MA 02111
Attn: Corporate Trust Department
Ruth A. Smith
Telecopy No.: (617) 662-1461
WIRE TRANSFER
State Street Bank and Trust Company of Connecticut,
National Association
ABA No._________
Acct. No. ________
Attn: Corporate Trust Administration
Reference: U.S. Airways, Inc. 1999-1 EETC/
N___U_
Owned Aircraft
Participation Agreement
N___U_
SCHEDULE II
COMMITMENTS
INTEREST RATE
PERCENTAGE AND MATURITY COMMITMENT
US Airways, Inc.
Pass Through Trust:
1999-1A 8.36% Series A Secured $__________
_______% Pass Through Certificates
due _____, ____
1999-1B 9.01% Series B Secured $__________
_______% Pass Through Certificates
due _____, ____
1999-1C 7.96% Series C Secured $__________
______% Pass Through Certificates
due _____, ____
Owned Aircraft
Participation Agreement
N___U_
SCHEDULE III
PASS THROUGH TRUST AGREEMENTS
Pass Through Trust Agreement, dated as of July 30, 1999, between US
Airways, Inc., US Airways Group, Inc. and State Street Bank and Trust
Company of Connecticut, National Association, as supplemented by Trust
Supplement No. 1999-1A, dated as of August 31, 1999, as supplemented by
Trust Supplement No. 1999-1B, dated as of August 31, 1999, as supplemented
by Trust Supplement No. 1999-1C, dated as of August 31, 1999.
Owned Aircraft
Participation Agreement
N___U_
EXHIBIT A
TO PARTICIPATION AGREEMENT
(N___U_)
SCHEDULE OF COUNTRIES FOR REREGISTRATION
Australia Malta
Austria Mexico
Bahamas Netherlands
Belgium New Zealand
Bermuda Norway
Brazil People's Republic of China
Canada Philippines
Denmark Portugal
Finland Republic of China (Taiwan)*
France Singapore
Germany South Korea
Grenada Spain
Greece Sweden
Iceland Switzerland
India Thailand
Ireland Tobago
Italy Trinidad
Jamaica Turkey
Japan United Kingdom
Luxembourg United States
Malaysia Venezuela
*So long as on the date of registration such country and the
United States have diplomatic relations at least as good as those in effect
on the Delivery Date.
Owned Aircraft Form Definitions
N___U_
ANNEX A
DEFINITIONS
(N___U_)
The following terms shall have the following meanings for all
purposes of the Operative Documents referred to below, unless otherwise
defined in an Operative Document or the context thereof shall otherwise
require and such meanings shall be equally applicable to both the singular
and the plural forms of the terms herein defined. In the case of any
conflict between the provisions of this Annex A and the provisions of the
main body of any Operative Document, the provisions of the main body of
such Operative Document shall control the construction of such Operative
Document.
Except as otherwise provided herein, all references to any
agreement defined in this Annex A shall be deemed to include such agreement
as the same may from time to time be amended, supplemented or otherwise
modified in accordance with its terms and, where applicable, the terms of
the other Operative Documents. All references to statutes, rules and
regulations shall be deemed to include all amendments, replacements and
successors thereto unless otherwise specified herein.
["Acceptable Alternate Engine" means (i) a CFM International
Model 56-5 (or improved) type engine having not less than 1,500 cycles left
before such engine's next scheduled maintenance overhaul or (ii) an engine
of the same or another manufacturer suitable for use on the Airframe and
having a value and utility equal to or greater than a CFM Model 56-5 type
engine, assuming such engine is in the condition required by the
Indenture.] (1)
- -------------------
(1) For A319 and A320 Aircraft; Definition for A330 Aircraft
to be determined.
"Actual Knowledge" means actual knowledge of a Responsible
Officer in the Corporate Trust Office of the Indenture Trustee.
"Additional Insured" means the Indenture Trustee, the Pass
Through Trustee, the Liquidity Provider, Owner in its capacity as lessor
under any Lease, and each of their respective Affiliates, successors and
permitted assigns, and the respective directors, officers, employees and
agents of the foregoing.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control
with such Person. For the purposes of this definition, "control"
(including "controlled by" and "under common control with") shall mean the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether through the ownership of
voting securities or by contract or otherwise.
"AIFS" means Airbus Industrie Financial Services, a corporation
formed under the laws of Ireland.
"Aircraft" means the Airframe to be subject to the Lien of the
Indenture (or any airframe from time to time substituted for such Airframe
pursuant to Section 5.06 of the Indenture) together with the two Engines
initially subject to the Lien of the Indenture (or any engine substituted
for either of such Engines pursuant to the terms of the Indenture), in each
case as specified in the applicable Indenture Supplement, whether or not
any of such initial or substituted Engines may from time to time be
installed on such initial or substituted Airframe or may be installed on
any other airframe or on any other aircraft.
"Airframe" means: (i) the Airbus aircraft (except Engines or
engines from time to time installed thereon) specified in the initial
Indenture Supplement, and any aircraft (except Engines or engines from
time to time installed thereon) which may from time to time be substituted
for such aircraft (except Engines or engines from time to time installed
thereon) pursuant to Section 5.06 of the Indenture; and (ii) any and all
Parts so long as the same shall be incorporated or installed in or attached
to such aircraft (except Engines or engines from time to time installed
thereon); provided, however, that at such time as an aircraft (except
Engines or engines from time to time installed thereon) shall be deemed
part of the property subject to the Lien of the Indenture in substitution
for the Airframe pursuant to the applicable provisions of the Indenture,
the replaced Airframe shall cease to be an Airframe subject to the Lien of
the Indenture; provided further that the Airframe shall not include
Passenger Convenience Equipment.
"Amortization Amount" means, with respect to any Principal Amount
Repayment Date, the amount set forth opposite such Date as the Principal
Amount to be repaid on the Amortization Schedule.
"Amortization Schedule" means the amortization schedule for the
Equipment Notes delivered pursuant to Section 2.02 of the Indenture.
"Applicable Rate" means as of any date the weighted average of
the interest rates borne by the Equipment Notes then outstanding and, if no
Equipment Notes shall be outstanding, the Base Rate.
"Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as
amended, or any subsequent legislation that amends, supplements or
supersedes such provisions.
"Base Rate" means the rate of interest announced publicly by The
Chase Manhattan Bank in New York, New York from time to time as its base
rate.
"Bill of Sale" means a full warranty bill of sale covering the
Aircraft delivered by the Manufacturer or its Affiliate to Owner.
"Business Day" means any day other than a Saturday or Sunday or a
day on which commercial banks are required or authorized to close in New
York, New York, Hartford, Connecticut or Pittsburgh, Pennsylvania.
"Cash Equivalents" means (i) direct obligations of the United
States of America and agencies guaranteed by the United States government
having a final maturity of ninety (90) days or less from date of purchase
thereof; (ii) certificates of deposit issued by, bankers' acceptances of,
or time deposits with, any bank, trust company or national banking
association incorporated under the laws of the United States of America or
one of the states thereof having combined capital and surplus and retained
earnings as of its last report of condition of at least $500,000,000 and
having a rating of Aa or better by Moody's Investors Service, Inc.
("Moody's") or AA or better by Standard & Poor's Corporation ("S&P") and
having a final maturity of ninety (90) days or less from date of purchase
thereof; and (iii) commercial paper of any holding company of a bank, trust
company or national banking association described in (ii) and commercial
paper of any corporation or finance company incorporated or doing business
under the laws of the United States of America or any state thereof having
a rating assigned to such commercial paper of A1 by S&P or P1 by Moody's
and having a final maturity of ninety (90) days or less from the date of
purchase thereof; provided, however, that the aggregate amount at any one
time so invested in certificates of deposit issued by any one bank shall
not be in excess of 5% of such bank's capital and surplus.
"Certificated Air Carrier" means a Citizen of the United States
holding a carrier operating certificate issued by the Secretary of
Transportation pursuant to Chapter 447 of Title 49, United States Code, for
aircraft capable of carrying ten or more individuals or 6,000 pounds or
more of cargo or that otherwise is certified or registered to the extent
required to fall within the purview of 11 U.S.C. Section 1110 or any
analogous successor provision of the Bankruptcy Code.
"Citizen of the United States" has the meaning specified for such
term in Section 40102(a)(15) of Title 49 of the United States Code or any
similar legislation of the United States of America enacted in substitution
or replacement therefor.
"Civil Reserve Air Fleet Program" means the Civil Reserve Air
Fleet Program currently administered by the United States Air Force Air
Mobility Command pursuant to Executive Order No. 11490, as amended, or any
substantially similar program.
"Class A Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class B Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class C Liquidity Provider" means AIG Matched Funding Corp., or
any successor thereto.
"Class C Purchase Agreement" means that certain Purchase
Agreement, dated as of August 31, 1999, by and between Owner and AIFS.
"Class C Special Indemnity Event" means the existence of any
condition or event which, pursuant to Section 3 of the Registration
Agreement, requires US Airways, Inc. to pay liquidated damages to the US
Airways Pass Through Trust 1999-1C in accordance with such Section 3,
subject to the last sentence of the first paragraph of Section 3 of the
Registration Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commitment" means the commitment pursuant to the Participation
Agreement of a Pass Through Trustee to finance a portion of Owner's cost
for the Aircraft.
"Consent and Agreement" means, collectively, each Consent and
Agreement (N___U_), dated as of the date of the Participation Agreement,
executed by the Seller and the Manufacturer, respectively, as the same may
be amended, modified or supplemented from time to time in accordance with
the applicable provisions thereof.
"Corporate Trust Office" means the principal office of the
Indenture Trustee located at 225 Asylum Street, Goodwin Square, Hartford,
Connecticut 06103, Attention: Corporate Trust Administration, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to Owner, the Loan Participants and each Note Holder.
"Debt Rate" means, with respect to any Series, the rate per annum
specified for such Series under the heading "Interest Rate" in Schedule I
to the Indenture.
"Default" means any event or condition that with the giving of
notice or the lapse of time or both would become an Event of Default.
"Delivery Date" means the date of the initial Indenture
Supplement for the Aircraft.
"Delivery Notice" means the notice of delivery delivered pursuant
to Section 2(b) of the Participation Agreement.
"Deposit Agreements" means, collectively, (i) that certain
Deposit Agreement (Class A), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary, (ii) that certain
Deposit Agreement (Class B), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary and (iii) that certain
Deposit Agreement (Class C), dated as of August 31, 1999, between First
Security Bank, National Association, as escrow agent under the Escrow
Agreement referred to therein, and the Depositary.
"Depositary" means ABN AMRO Bank N.V., acting through its Chicago
branch, as Class A Depositary, Class B Depositary and Class C Depositary
under the Deposit Agreements, or any successors thereto.
"Dollars" and "$" mean the lawful currency of the United States
of America.
"Engine" means (i) each of the two [CFM International 56-5] (2)
[Pratt & Whitney] (3) type engines listed by manufacturer's serial number in
the initial Indenture Supplement, whether or not from time to time
thereafter installed on the Airframe or installed on any other airframe or
on any other aircraft; and (ii) any Acceptable Alternate Engine that may
from time to time be substituted, pursuant to the terms of the Indenture,
for either of such two engines, together in each case with any and all
Parts incorporated or installed in or attached thereto or any and all Parts
removed there from; provided, however, that at such time as an engine shall
be deemed part of the property leased under the Indenture in substitution
for an Engine pursuant to the applicable provisions of the Indenture, the
replaced Engine shall cease to be an Engine subject to the Lien of the
Indenture. The term "Engines" means, as of any date of determination, all
Engines then subject to the Lien of the Indenture.
- -------------------
(2) For A319 and A320 Aircraft
(3) For A330 Aircraft
"Equipment Note Register" has the meaning specified for such term
in Section 2.07 of the Indenture.
"Equipment Note Registrar" has the meaning specified for such
term in Section 2.07 of the Indenture.
"Equipment Notes" means and include any Equipment Notes issued
under the Indenture, and issued in exchange therefor or replacement
thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of the Participation Agreement and any subsequent
provisions of ERISA, amendatory thereof, supplemental thereto or
substituted therefor.
"Escrow Agreements" means, collectively, (i) that certain Escrow
and Paying Agent Agreement (Class A), dated as of August 31, 1999, among
First Security Bank, National Association, as escrow agent, the
Underwriters, the Pass Through Trustee, and State Street Bank and Trust
Company of Connecticut, National Association, as paying agent thereunder,
(ii) that certain Escrow and Paying Agent Agreement (Class B), dated as of
August 31, 1999, among First Security Bank, National Association, as escrow
agent, the Underwriters, the Pass Through Trustee, and State Street Bank
and Trust Company of Connecticut, National Association, as paying agent
thereunder and (iii) that certain Escrow and Paying Agent Agreement (Class
C), dated as of August 31, 1999, among First Security Bank, National
Association, as escrow agent, the Underwriters, the Pass Through Trustee,
and State Street Bank and Trust Company of Connecticut, National
Association, as paying agent thereunder.
"Event of Default" has the meaning specified for such term in
Section 4.02 of the Indenture.
"Event of Loss" means, with respect to the Aircraft, Airframe
or any Engine, any of the following events with respect to such property:
(i) the loss of such property or of the use thereof due to the destruction
of or damage to such property which renders repair uneconomic or which
renders such property permanently unfit for normal use by Owner (or any
Lessee) for any reason whatsoever; (ii) any damage to such property which
results in an insurance settlement with respect to such property on the
basis of a total loss, or a constructive or compromised total loss; (iii)
the theft or disappearance of such property for a period in excess of one
hundred eighty (180) days; (iv) the requisition for use of such property by
any governmental authority (other than a requisition for use by the United
States Government or any government of registry of the Aircraft or any
agency or instrumentality thereof) that shall have resulted in the loss of
possession of such property by Owner (or any Lessee) for a period in excess
of one hundred eighty (180) consecutive days; (v) [intentionally omitted];
(vi) condemnation, confiscation, requisition or taking of title of the
Aircraft or the Airframe for more than thirty (30) days; (vii) as a result
of any law, rule, regulation, order or other action by the Federal Aviation
Administration or other governmental body of the government of registry of
the Aircraft having jurisdiction, the use of such property in the normal
course of the business of air transportation shall have been prohibited for
a period of one hundred eighty (180) consecutive days, unless Owner (or
Lessee) shall have undertaken and shall be diligently carrying forward all
steps which are necessary or desirable to permit the normal use of such
property by Owner (or such Lessee), but in any event an "Event of Loss"
shall occur if such "grounding" extends for a period of more than three
hundred sixty (360) days; provided that no Event of Loss shall be deemed to
occur if such "grounding" is applicable to Owner's entire fleet of
[A319][A320][A330] aircraft and Owner, prior to the expiration of one year
from the prohibition of such use, shall have conformed at least one such
aircraft in its fleet to the requirements of any such law, rule,
regulation, order or other action and commenced regular commercial use of
the same in such jurisdiction and shall be diligently carrying forward, on
a non-discriminatory basis, all steps which are necessary or desirable to
permit the normal use of the Aircraft by Owner (or such Lessee), but in any
event an "Event of Loss" shall be deemed to have occurred if such use shall
have been prohibited for a period of two consecutive years; and (viii) with
respect to an Engine only, any divestiture of title to or interest in an
Engine or any event with respect to an Engine that is deemed to be an Event
of Loss with respect to such Engine pursuant to Section 5.06(b) of the
Indenture. An Event of Loss with respect to the Aircraft shall be deemed to
have occurred if an Event of Loss occurs with respect to the Airframe.
"Expenses" means all liabilities, obligations, losses, damages,
settlements, penalties, claims, actions, suits, costs, expenses and
disbursements (including, without limitation, reasonable fees and
disbursements of legal counsel, accountants, appraisers, inspectors or
other professionals and reasonable costs of investigation).
"FAA Bill of Sale" means a bill of sale for the Aircraft on AC
Form 8050-2 (or such other form as may be approved by the FAA) delivered to
Owner by the Manufacturer or its Affiliates.
"Federal Aviation Administration" and "FAA" mean the United
States Federal Aviation Administration and any agency or instrumentality of
the United States government succeeding to their functions.
"Federal Funds Rate" means a fluctuating interest rate per annum
in effect from time to time, which rate per annum shall at all times be
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by State Street from three Federal funds brokers of
recognized standing selected by it.
"Foreign Air Carrier" means any air carrier which is not a U.S.
Air Carrier and which performs, or contracts for the performance of,
maintenance, preventative maintenance and inspections for the Aircraft,
Airframe and/or any Engine or engine to standards which are approved by, or
which are substantially equivalent to those required by, the Federal
Aviation Administration or any Permitted Foreign Air Authority.
"French Pledge Agreement" means the French Pledge Agreement,
dated as of the date of the Participation Agreement, between the Owner and
the Indenture Trustee, as the same may be amended, supplemented or
modified from time to time.
"Government Entity" means (a) any federal, state, provincial or
similar government, and any body, board, department, commission, court,
tribunal, authority, agency or other instrumentality of any such government
or otherwise exercising any executive, legislative, judicial,
administrative or regulatory functions of such government or (b) any other
government entity having jurisdiction over any matter contemplated by the
Operative Documents or relating to the observance or performance of the
obligations of any of the parties to the Operative Documents.
"Indemnitee" means (i) the Indenture Trustee, (ii) the Loan
Participants and each other Note Holder, (iii) the Subordination Agent,
(iv) the Liquidity Provider, (v) the Pass Through Trustees, (vi) each
Affiliate of the Persons described in clauses (i) through (v), inclusive,
(vii) the respective directors, officers, employees, agents and servants of
each of the Persons described in clauses (i) through (vi), inclusive, and
(viii) the successors and permitted assigns of the Persons described in
clauses (i) through (vii), inclusive.
"Indemnity Agreement" means that certain Indemnity Agreement,
dated as of August 31, 1999, between the Depositary and Owner.
"Indenture" means that certain Indenture and Security Agreement
(N___U_), dated as of the date of the Participation Agreement, between
Owner and the Indenture Trustee, as it may from time to time be
supplemented or amended as therein provided, including supplementing by the
Indenture Supplement pursuant to the Indenture.
"Indenture Agreements" means the Participation Agreement, the
Purchase Agreement, the Purchase Agreement Assignment, the French Pledge
Agreement, the Consent and Agreement and any other contract, agreement or
instrument from time to time assigned or pledged under the Indenture.
"Indenture Estate" means all estate, right, title and interest of
the Indenture Trustee in and to the properties referred to in the Granting
Clause of the Indenture.
"Indenture Indemnitees" means (i) State Street and the Indenture
Trustee, (ii) each separate or additional trustee appointed pursuant to the
Indenture, (iii) the Subordination Agent, (iv) the Liquidity Provider, (v)
each Pass Through Trustee, and (vi) each of the respective directors,
officers, employees, agents and servants of each of the Persons described
in clauses (i) through (v), inclusive.
"Indenture Supplement" means a supplement to the Indenture,
substantially in the form of Exhibit A to the Indenture, which shall
particularly describe the Aircraft, and any Replacement Airframe and
Replacement Engine included in the property subject to the Lien of the
Indenture.
"Indenture Trustee" means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its individual capacity, but solely as Indenture Trustee, and any entity
which may from time to time be acting as indenture trustee under the
Indenture.
"Indenture Trustee Documents" means the Participation Agreement,
the Indenture, the Purchase Agreement Assignment, the French Pledge
Agreement and any other agreements between the Indenture Trustee and any
other party to the Participation Agreement relating to the Transactions,
delivered on the Delivery Date.
"Indenture Trustee's Liens" means any Lien which arises as a
result of (A) claims against the Indenture Trustee not related to its
interest in the Aircraft, (B) acts of the Indenture Trustee not permitted
by, or failure of the Indenture Trustee to take any action required by, the
Operative Documents to the extent such acts arise or such failure arises
from or constitutes gross negligence or willful misconduct, (C) claims
against the Indenture Trustee relating to Taxes or Expenses which are
excluded from the indemnification provided by Section 6 of the
Participation Agreement pursuant to said Section 6, or (D) claims against
the Indenture Trustee arising out of the transfer by the Indenture Trustee
of all or any portion of its interest in the Aircraft, the Indenture Estate
or the Operative Documents other than a transfer of the Aircraft pursuant
to Article IV or V of the Indenture.
"Insurance Brokers" has the meaning specified for such term in
Exhibit B to the Indenture.
"Intercreditor Agreement" means that certain Intercreditor
Agreement, dated as of August 31, 1999, among the Pass Through Trustees,
the Liquidity Provider and the Subordination Agent.
"Law" means (a) any constitution, treaty, statute, law,
regulation, order, rule or directive of any Government Entity, and (b) any
judicial or administrative interpretation or application of, or decision
under, any of the foregoing.
"Lease" means any lease permitted by the terms of Section
7.02(b)(x) of the Indenture.
"Lessee" means any Person for so long, but only so long, as such
Person is in possession of the Airframe and/or any Engine pursuant to the
terms of a Lease which is then in effect pursuant to Section 7.02(b) of the
Indenture.
"Lien" means any mortgage, pledge, lien, charge, claim,
encumbrance, lease, sublease, sub-sublease or security interest.
"Liquidity Facilities" means the three Revolving Credit
Agreements, each dated as of August 31, 1999, between the Subordination
Agent, as borrower, and the Liquidity Provider, and any replacement
thereof, in each case as the same may be amended, modified or supplemented.
"Liquidity Provider" means AIG Matched Funding Corp., as Class A
Liquidity Provider, Class B Liquidity Provider and Class C Liquidity
Provider under the Liquidity Facilities, or any successor thereto.
"Loan Participant" means each Purchaser and its respective
successors and registered assigns, including any Note Holder.
"Loan Participant Liens" means any Lien which arises from acts or
claims against any Loan Participant not related to the transactions
contemplated by the Operative Documents.
"Majority in Interest of Note Holders" as of a particular date of
determination means the holders of more than a majority in aggregate unpaid
Principal Amount of all Equipment Notes outstanding as of such date
(excluding any Equipment Notes held by Owner or any Affiliate thereof).
"Make-Whole Amount" means, with respect to any Equipment Note,
the amount (as determined by an independent investment banker selected by
Owner and reasonably acceptable to the Indenture Trustee) 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 Treasury Yield exceeds (b) the outstanding
principal amount of such Equipment Note plus accrued interest. For
purposes of determining the Make-Whole Amount, "Treasury Yield" means, at
the time of determination, 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 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
and (B) the other maturing as close as possible to, but later than, the
Average Life Date, 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 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. "Average Life Date" means, for each Equipment Note to be
redeemed, 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.
"Manufacturer" means Airbus Industrie G.I.E., a groupement
d'interet economique established under Ordonnance No. 67-821 dated
September 23, 1967 of the Republic of France, and its successors and
assigns.
"Manufacturer Documents" means the Purchase Agreement and the
Consent and Agreement.
"Mortgaged Property" has the meaning specified for such term in
Section 3.03 of the Indenture.
"Multiplier" means (i) on any date when no Class C Special
Indemnity Event is continuing, 0.00, (ii) on each day during the first
ninety (90)-day period immediately following the occurrence of a Class C
Special Indemnity Event, 0.0025, and (iii) thereafter, on each day during
each subsequent ninety (90)-day period for so long as such Class C Special
Indemnity Event exists, the Multiplier in effect for the immediately
preceding ninety (90)-day period plus 0.0025; provided, that (a)
notwithstanding the foregoing, the maximum Multiplier shall be 0.01, and
(b) the Multiplier shall reset after such Class C Special Indemnity Event
has ceased or no longer exists and clause (i) shall apply again to any
subsequent Class C Special Indemnity Event.
"Non-U.S. Person" means any Person other than a U.S. Person.
"Note Holder" means any holder from time to time of one or more
Equipment Notes.
"Note Purchase Agreement" means the Note Purchase Agreement dated
as of the Pass Through Trust Closing Date among Owner, the Pass Through
Trustee for the Pass Through Trusts, the Subordination Agent, First
Security Bank, National Association, as Escrow Agent, and State Street Bank
and Trust Company of Connecticut, National Association, as Paying Agent.
"Obsolete Parts" has the meaning specified for such term in
Section 7.03(c) of the Indenture.
"Operative Documents" means, collectively, the Participation
Agreement, the Indenture, the Indenture Supplement covering the Aircraft,
the Equipment Notes, the Purchase Agreement (insofar as it relates to the
Aircraft), the Purchase Agreement Assignment, the French Pledge Agreement
and the Consent and Agreement (each, an "Operative Document").
"Operative Indentures" means each of the indentures under which
notes have been issued and purchased by the Pass Through Trustees.
"Owner" means US Airways, Inc., a Delaware corporation.
"Owner Documents" means the Participation Agreement, the French
Pledge Agreement, the Indenture and the Equipment Notes.
"Participants" means the Loan Participants (each individually, a
"Participant").
"Participation Agreement" means that certain Participation
Agreement (N___U_), dated as of , ____, among the
Subordination Agent, the Indenture Trustee, Owner and the Pass Through
Trustee, as the same may from time to time be supplemented or further
amended, or the terms thereof waived or modified, to the extent permitted
by, and in accordance with, the terms thereof.
"Parts" means all appliances, parts, instruments, appurtenances,
accessories, furnishings and other equipment of whatever nature (other than
(a) complete Engines or engines, (b) any items leased by Owner from a third
party and (c) cargo containers) which may from time to time be incorporated
or installed in or attached to the Airframe or any Engine for so long as
such items remain subject to the Lien of the Indenture after removal
therefrom; provided that "Parts" shall not include Passenger Convenience
Equipment.
"Pass Through Certificates" means the pass through certificates
to be issued by the Pass Through Trustee in connection with the
Transactions.
"Pass Through Documents" means the Participation Agreement, the
Pass Through Trust Agreements, the Note Purchase Agreement, the Deposit
Agreements, the Liquidity Facilities and the Intercreditor Agreement.
"Pass Through Indemnitees" means (i) the Subordination Agent, the
Liquidity Provider and the Pass Through Trustee, (ii) each Affiliate of a
Person described in the preceding clause (i), (iii) the respective
directors, officers, employees, agents and servants of each of the Persons
described in the preceding clauses (i) and (ii), and (iv) the successors
and permitted assigns of the Persons described in the preceding clauses
(i), (ii) and (iii).
"Pass Through Trust" means, collectively, the three separate
grantor trusts set forth in Schedule III to the Participation Agreement
created, pursuant to the Pass Through Trust Agreements and each of the Pass
Through Trust Supplements set forth in Schedule III to the Participation
Agreement, to facilitate certain of the transactions contemplated by the
Operative Documents.
"Pass Through Trust Agreement" means the pass through trust
agreement and each of the three separate pass through trust supplements
referred to on Schedule III to the Participation Agreement.
"Pass Through Trust Closing Date" means August 31, 1999.
"Pass Through Trustee" means State Street Bank and Trust Company
of Connecticut, National Association, a national banking association, in
its capacity as trustee under each Pass Through Trust Agreement, and each
other Person that may from time to time be acting as successor trustee
under any such Pass Through Trust Agreement.
"Passenger Convenience Equipment" means available components or
systems installed on or affixed to the Airframe that are used to provide
individual telecommunications to passengers aboard the Aircraft.
"Past Due Rate" means a rate per annum equal to 1% over the Debt
Rate.
"Payment Date" means each January 20 and July 20, commencing on
________ 20, ____ (or, if any such day is not a Business Day, the
immediately succeeding Business Day) until the Equipment Notes have been
paid in full.
"Permitted Foreign Air Authority" means the Civil Aviation
Authority of the United Kingdom, the Direction Generale de l'Aviation
Civile of the French Republic, the Luftfahrt Bundesamt of the Federal
Republic of Germany, the Rijflauchtraatdienst of the Kingdom of the
Netherlands, the Ministry of Transportation of Japan or the Federal
Ministry of Transport of Canada (and any agency or instrumentality of the
applicable government succeeding to the functions of any of the foregoing
entities).
"Permitted Foreign Air Carrier" means any air carrier with its
principal executive office in a country listed in Exhibit C to the
Indenture as in effect from time to time and as may be modified in
accordance with Section 7(b) of the Participation Agreement.
"Permitted Lien" means any Lien referred to in clauses (i)
through (viii) of Section 7.01 of the Indenture.
"Permitted Lessee" means any (i) manufacturer of airframes or
aircraft engines, or any Affiliate of a manufacturer of airframes or
aircraft engines, (ii) any Permitted Foreign Air Carrier, (iii) any person
approved in writing by the Indenture Trustee and (iv) any U.S. Air Carrier.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"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" means the [Sale and Purchase Agreement,
dated as of October 31, 1997, between the Seller and US Airways Group,
Inc., ] (4) [Purchase Agreement dated as of November 24, 1998 between US
Airways Group, Inc. and the Seller ] (5) (including all exhibits thereto,
together with all letter agreements entered into that by their terms
constitute part of any such Purchase Agreement), as the same may be amended
or otherwise supplemented from time to time, relating to the Aircraft.
- -------------------
(4) For A319 and A320 Aircraft transactions.
(5) For A330 Aircraft transactions
"Purchase Agreement Assignment" means the Purchase Agreement
Assignment (N___U_), dated as of the date of the Participation Agreement,
between Owner and the Indenture Trustee, as the same may be amended,
supplemented or modified from time to time, with a form of Consent and
Agreement to be executed by the Seller attached thereto.
"Purchasers" means the Pass Through Trustees under each Pass
Through Trust Agreement.
"QIB" has the meaning specified for such term in Section 2.08 of
the Indenture.
"Registration Agreement" means the Registration Agreement dated
August 31, 1999 by Owner, and confirmed and accepted by AIFS, in respect of
the ___% Pass Through Certificates, Series 1999-1, Class C, as such
Registration Agreement may be amended, modified and supplemented from time
to time in accordance with the provisions thereof.
"Remaining Weighted Average Life" of an Equipment Note, at the
redemption date of such Equipment Note, means 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.
"Replacement Airframe" means any airframe substituted for the
Airframe pursuant to Section 5.06 of the Indenture.
"Replacement Engine" means any engine substituted for an Engine
pursuant to Section 5.06 of the Indenture.
"Responsible Officer" means a responsible officer in the
Corporate Trust Office of the Indenture Trustee.
"Scheduled Delivery Date" has the meaning specified for such term
in Section 2(d) of the Participation Agreement.
"Secured Obligations" has the meaning specified for such term in
the Granting Clause of the Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" means AVSA, S.A.R.L., a societE a responsabilite limitee
organized and existing under the laws of the Republic of France.
"Senior Holder" has the meaning specified for such term in
Section 2.15(c) of the Indenture.
"Series A" or "Series A Equipment Notes" means Equipment Notes
issued and designated as "Series A" under the Indenture, in the Principal
Amount and maturities and bearing interest as specified in Schedule I to
the Indenture under the heading "Series A."
"Series B" or "Series B Equipment Notes" means Equipment Notes
issued and designated as "Series B" under the Indenture, in the Principal
Amount and maturities and bearing interest as specified in Schedule I to
the Indenture under the heading "Series B."
"Series C" or "Series C Equipment Notes" means Equipment Notes
issued and designated as "Series C" under the Indenture, in the Principal
Amount and maturities and bearing interest as specified in Schedule I to
the Indenture under the heading "Series C."
"State Street" means State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its capacity as Indenture Trustee under the Indenture, but in its
individual capacity.
"Subordination Agent" means State Street Bank and Trust Company
of Connecticut, National Association, a national banking association, as
subordination agent under the Intercreditor Agreement, or any successor
thereto.
"Taxes" means any and all fees (including, without limitation,
license, recording, documentation and registration fees), taxes (including,
without limitation, income, gross receipts, sales, rental, use, turnover,
value added, property (tangible and intangible), excise and stamp taxes),
license, levies, imposts, duties, recording charges and assessments of any
kind whatsoever that are in the nature of taxes or other governmental
charges including interest, penalties and additions to tax (each,
individually a "Tax").
"Transaction Expenses" means: all of the reasonable out-of-
pocket costs, fees and expenses incurred by Owner, the Pass Through
Trustee, the Subordination Agent and the Indenture Trustee in connection
with the transactions contemplated by the Participation Agreement, the
other Operative Documents, the Pass Through Trust Agreements, the Pass
Through Documents, the Intercreditor Agreement, the Liquidity Facilities
and the Underwriting Agreement (except, in each case, as otherwise provided
therein) including, without limitation:
(a) the reasonable and actual fees, expenses and disbursements of (A)
Bingham Dana LLP, special counsel for the Pass Through Trustee,
the Subordination Agent and the Indenture Trustee, (B) Milbank,
Tweed, Hadley & McCloy LLP, special counsel for the Underwriters,
and (C) Crowe & Dunlevy, P.C., special counsel in Oklahoma City,
Oklahoma and (D) Simpson Thacher & Bartlett, special counsel to
AIFS;
(b) the initial fee and reasonable and actual disbursements of the
Indenture Trustee under the Indenture;
(c) the initial fees and expenses of the Liquidity Provider, the Pass
Through Trustee and the Subordination Agent;
(d) underwriting fees and commissions;
(e) the fees and expenses with respect to the appraisal of the
Aircraft;
(f) the fees, expenses and disbursements of Skadden, Arps, Slate,
Meagher & Flom LLP and its affiliates, special counsel for Owner;
(g) the costs of filing and recording documents with the FAA and
filing Uniform Commercial Code statements in the United States;
(h) the reasonable fees, expenses and disbursements of special
counsel to the Liquidity Provider;
(i) the expenses of the Depositary payable under Section 10(a) of
each Indemnity Agreement; and
(j) the reasonable fees, expenses and disbursements of, Clifford
Chance, special counsel to the Seller and the Manufacturer.
"Transactions" means the transactions contemplated by the
Participation Agreement and the other Operative Documents.
"Transportation Code" means that portion of the United States
Code comprising those provisions formerly referred to as the Federal
Aviation Act of 1958, as amended, or any subsequent legislation that
amends, supplements or supersedes such provisions.
"Underwriters" means Credit Suisse First Boston Corporation,
Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities Corporation,
Deutsche Bank Securities Inc. and Salomon Smith Barney Inc.
"U.S. Air Carrier" means any Certificated Air Carrier as to which
there is in force an air carrier operating certificate issued pursuant to
Part 121 of the regulations under the Transportation Code, or which may
operate as an air carrier by certification or otherwise under any successor
or substitute provisions therefor or in the absence thereof.
"U.S. Person" means any Person that qualifies as a "United States
person" under Section 7701(a)(30) of the Code.
"Wet Lease" means any arrangement whereby the Owner (or any
Lessee) agrees to furnish the Airframe and Engines or engines installed
thereon to a third party pursuant to which such Airframe and Engines or
engines (i) shall be operated solely by regular employees of Owner (or any
Lessee) possessing all current certificates and licenses that would be
required under the Transportation Code, or, if the Aircraft is not
registered in the United States, all certificates and licenses required by
the laws of the jurisdiction of registry, for the performance by such
employees of similar functions within the United States of America or such
other jurisdiction of registry (it is understood that cabin attendants need
not be regular employees of Owner (or any Lessee)) and (ii) shall be
maintained by Owner (or any Lessee) in accordance with its normal
maintenance practices.
[FORM OF SASM&F (ILLINOIS)
OPINION FOR OWNED AIRCRAFT]
__________, [1999][2000]
To Each Person Listed on
Schedule I Hereto
Re: US Airways, Inc. Trust No. N
Ladies and Gentlemen:
We have acted as special counsel to US Airways, Inc., a
Delaware corporation ("US Airways"), in connection with the execution and
delivery of (i) the Participation Agreement (US Airways, Inc. Trust No.
N______), dated as of __________, [1999][2000] (the "Participation
Agreement"), among US Airways, as Lessee and State Street Bank and Trust
Company of Connecticut, National Association, a national banking
association, not in its individual capacity except as otherwise provided
therein, but solely as Pass Through Trustee, Indenture Trustee and
Subordination Agent relating to the Aircraft described in the Indenture
Supplement (as defined below); (ii) the issuance and sale of the Equipment
Notes (as defined below) pursuant to the Trust Indenture and Security
Agreement (N ____), dated as of ________, [1999][2000] by and between US
Airways and the Indenture Trustee ("the Trust Indenture"), as supplemented
by the Trust Indenture and Security Agreement Supplement (N_____), dated
_________, [1999][2000] of US Airways (the "Indenture Supplement"); (iii)
the Purchase Agreement Assignment, dated as of ____ ___, [1999][2000],
between the Indenture Trustee and US Airways (the "Purchase Agreement
Assignment"); (iv) the Pass Through Trust Agreement, dated as of
_____________, 1999, between the Pass Through Trustee and US Airways (the
"Pass Through Trust Agreement"); and (v) each of the Pass Through Trust
Supplements dated as of ________, 1999 (collectively, the "Pass Through
Trust Supplements"). This opinion is being delivered pursuant to Section
[4(a)(xi)] of the Participation Agreement.
In our examination, we have assumed the genuineness of all
signatures, including indorsements, the legal capacity of natural persons,
the authenticity of all documents submitted to us as originals, the
conformity to original documents of all copies submitted to us as
telefacsimile, certified or photostatic copies, and the authenticity of the
originals of such copies. As to any facts material to this opinion, we have
relied solely upon statements, representations and warranties of US
Airways, the Indenture Trustee, the Subordination Agent, the Pass Through
Trustee and their respective officers and representatives, and others in
the Operative Documents and of public officials, including the facts set
forth in the Company's Certificate described below, and we have made no
independent investigation or inquiry with respect to such factual matters.
In rendering the opinions set forth herein, we have examined
and relied on originals or copies of the following:
(a) the Participation Agreement;
(b) the Purchase Agreement Assignment;
(c) the Trust Indenture;
(d) the Indenture Supplement;
(e) the Equipment Notes;
(f) the Pass Through Trust Agreement;
(g) each of the Pass Through Trust Supplements;
(h) unfiled, but signed copies of financing statements naming
"U.S. Airways, Inc." as debtor and "State Street Bank and Trust Company of
Connecticut, as Indenture Trustee" as secured party, which we understand
will be filed within ten (10) days of the transfer of the security interest
in the Offices of the Secretary of State of the State of New York (such
filing Office, the "New York Filing Office" and such financing Statement,
the "New York Financing Statement");
(i) unfiled, but signed financing statements naming "US
Airways, Inc." as debtor and "State Street Bank and Trust Company of
Connecticut, as Indenture Trustee" as secured party, which we understand
will be filed within ten (10) days of the transfer of the security interest
in the offices of State Corporation Commission, Virginia and the Arlington
County Clerk (such filing offices, the "Non-Admitted State Filing Offices"
and such financing statements, the "Non-Admitted State Financing
Statements");
(j) a certificate of US Airways, dated the date hereof, a copy
of which is attached as Exhibit A;
(k) certified copies of the Certificate of Incorporation and
By-laws of US Airways;
(l) certified copies of certain resolutions of the Board of
Directors of US Airways adopted on _______;
(m) a certificate of good standing from the Secretary of State
of the State of Delaware as to the good standing of US Airways in such
jurisdiction; and
(n) such other documents as we have deemed necessary or
appropriate as a basis for the opinions set forth below.(1)
We express no opinion as to the laws of any jurisdiction other
than (i) the Applicable Laws of the State of New York , (ii) the General
Corporation Law of the State of Delaware and (iii) the Applicable Laws of
the United States of America. In this respect, we call to your attention
that certain of the Operative Documents are governed by laws of
jurisdictions other than those described above and we express no opinion as
to the effect of any such laws on the opinions expressed herein. In
addition, we express no opinion with respect to the Transportation Code or
the rules and regulations of the Federal Aviation Administration or the
effect thereof on the opinions herein stated. In addition, we call to your
attention that we are not admitted to practice in the State of Virginia
(the "Non-Admitted State") and our opinions in paragraph 8 with respect to
the laws of such State is based solely on our review of Sections 9-401 and
9-402 of the Uniform Commercial Code in effect in the State of Virginia
(the "Non-Admitted State UCC") as published in the CCH Secured Transactions
Guide without regard to case law decided thereunder.
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(1) For transactions involving leases to Shuttle, include a
reference to Shuttle Lease.
Capitalized terms not otherwise defined herein have the
meanings assigned thereto in Annex A to the Participation Agreement. The
documents referred to in (a) through (g) above shall hereinafter be
referred to collectively as the "Transaction Documents." "Applicable Laws"
shall mean those laws, rules, regulations which, in our experience, are
normally applicable to transactions of the type contemplated by the
Transaction Documents, without our having made any special investigation as
to the applicability of any special law, rule or regulation, and which are
not the subject of a specific opinion herein referring to a particular law
or laws. "Governmental Approval" means any consent, approval, license,
authorization or validation of, or filing, recording or registration with,
any governmental authority pursuant to Applicable Laws. Unless otherwise
indicated, the "New York UCC" means the Uniform Commercial Code as in
effect on the date hereof in the State of New York.
Based upon the foregoing, and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that:
1. Each of the Transaction Documents constitutes the valid and
binding obligation of US Airways enforceable against US Airways in
accordance with its terms under the laws of the State of New York. The
Trust Indenture and the Indenture Supplement constitute valid and binding
obligations of the Indenture Trustee enforceable against the Indenture
Trustee in accordance with their terms under the laws of the State of New
York.
2. Neither the execution and delivery by US Airways of the
Transaction Documents nor the compliance by US Airways with the terms and
provisions thereof will contravene any Applicable Law of the State of New
York or any Applicable Law of the United States of America.
3. Except for (a) the due and timely filing and, where
appropriate, recording of the Trust Indenture (with the Indenture
Supplement covering the Aircraft attached as an exhibit), pursuant to the
Transportation Code, (b) the registration of the issuance and sale of the
Pass Through Certificates under the Securities Act, (c) compliance with the
securities law of each applicable state and (d) filing of appropriate UCC
Financing Statements and continuation statements, no Governmental Approval,
which has not been obtained or taken and is not in full force
and effect, is required in connection with the execution, delivery or
enforceability by US Airways of any of the Transaction Documents.
4. No registration of US Airways or any of the Pass Through
Trusts under the Investment Company Act of 1940, as amended, is required.
5. The Equipment Notes, when issued to and acquired by the
Pass Through Trustee, will be valid and binding obligations of US Airways
enforceable against US Airways in accordance with their terms and the terms
of the Trust Indenture, as supplemented by the Indenture Supplement, and
will be entitled to the benefits of the Trust Indenture, as supplemented by
the Indenture Supplement.
6. The provisions of the Trust Indenture, as supplemented by
the Indenture Supplement, are effective to create, in favor of the
Indenture Trustee to secure the Secured Obligations, a valid security
interest in US Airways' rights in that portion of the collateral described
therein which is subject to Article 9 of the New York UCC (the "UCC
Collateral").
7. The New York Financing Statement is in appropriate form for
filing in the New York Filing Office. To the extent that the New York UCC
governs the perfection of a security interest in US Airways' rights in the
UCC Collateral, as to which we express no opinion, the security interest in
favor of the Indenture Trustee in the UCC Collateral described in the New
York Financing Statement will be perfected upon filing of the New York
Financing Statement in the New York Filing Office.
Our opinions in paragraph 6 and 7 with respect to the security
interest of the Indenture Trustee is subject to the following
qualifications:
(a) We have assumed the US Airways owns, or with respect to
after-acquired property will own, the UCC Collateral, and we express no
opinion as to the nature or extent of US Airways' rights in or title to any
of the UCC Collateral and we note that with respect to after-acquired
property, the security interest will not attach until US Airways acquires
ownership thereof.
(b) Our opinion with respect to the validity of the security
interest of the Indenture Trustee is limited to Article 9 of the New York
UCC, and such opinion does not address (i) laws of jurisdictions other than
New York, and of New York except for Article 9 of the UCC, (ii) collateral
of a type not subject to Article 9 of the Applicable UCC, and (iii) what
law governs perfection or priority of the security interests granted in the
collateral covered by this opinion.
(c) We call your attention that under the UCC, events occurring
subsequent to the date hereof may affect any security interest subject to
the UCC including, but not limited to, factors of the type identified in
Section 9-306 with respect to proceeds; Section 9-103 with respect to
changes in the location of the collateral and the location of a debtor; and
Sections 9-307, 9-308 and 9-309 with respect to subsequent purchasers of
the collateral. In addition, actions taken by a secured party (e.g.,
releasing or assigning the security interest, delivering possession of the
collateral to a debtor or another person and voluntarily subordinating a
security interest) may affect any security interest subject to the UCC.
(d) We express no opinion with respect to the priority of the
security interest of the Indenture Trustee.
(e) We call to your attention that with respect to any goods
which is an accession to, or commingled or processed with other goods, the
security interest of the Indenture Trustee may be limited by Section 9-314
or 9-315 of the New York UCC.
(f) In the case of any instrument, chattel paper, account or
general intangible which is itself secured by other property, we express no
opinion with respect to the Indenture Trustee's rights in and to such
underlying property.
(g) In the case of chattel paper, accounts or general
intangibles, we call to your attention that the security interest of the
Indenture Trustee for the benefit of the Pass Through Trustee may be
subject to the rights of account debtors, claims and defenses of account
debtors and the terms of agreements with account debtors.
(h) In the case of goods, we express no opinion regarding the
security interest of the Indenture Trustee for the benefit of the Pass
Through Trustee in any goods which are subject to a certificate of title or
a document of
title.
(i) We express no opinion regarding the security interest of
the Indenture Trustee for the benefit of the Pass Through Trustee in any
items which are subject to a statute, regulation or treaty of the United
States of America which provides for a national or international
registration or a national or international certificate of title for the
perfection of a security interest therein or which specifies a place of
filing different from the place specified in the UCC for filing to perfect
such security interest.
(j) We express no opinion regarding the security interest of
the Indenture Trustee for the benefit of the Pass Through Trustee in any of
the UCC Collateral consisting of claims against any government or
governmental agency (including without limitation the United States of
America or any state thereof or any agency or department of the United
States of America or any state thereof).
(k) We have assumed that US Airways maintains a place of
business in more than one county in the State of New York.
8. You have asked our opinion whether the Non-Admitted State
UCC Financing Statements are in a form acceptable for filing under the
Non-Admitted State UCC and also whether the filing of any additional county
filings would be necessary under the Non-Admitted State UCC. We call to
your attention that we are not admitted to practice in the State of
Virginia and our opinion is limited to the review described below. We
express no opinion with respect to the perfection or priority of the
security interest of the Indenture Trustee for the benefit of the Note
Holders.
A. Based solely on our review of Section 9-402 of the Non-Admitted State
UCC as published in the CCH Secured Transaction Guide (without
consideration of case law decided thereunder), we are of the opinion
that no additional information is required on the face of the
Non-Admitted State Financing Statements for the Non-Admitted State
Financing Statements to be accepted for filing in the Non-Admitted
State Filing offices.
B. Based solely on our review of Section 9-401 of the Non-Admitted State
UCC as published in the CCH Secured Transaction Guide (without
consideration of case law decided thereunder), we are of the opinion
that the Indenture Trustee for the benefit of the Note Holders is not
required to file UCC financing statements in any additional county
filing offices in the State of Virginia.
Our opinion in paragraph 8 with respect to the security interest in the
Non-Admitted State is subject to the following qualifications:
(a) our opinions are limited to Sections 401 and 402 of Article
9 of the Non-Admitted State UCC, and therefore such opinions do not address
(i) laws of jurisdictions other than the Non-Admitted State, and of the
Non-Admitted State except for Sections 401 and 402 of Article 9 of the
Non-Admitted State UCC, (ii) collateral of a type not subject to Article 9
of the Non-Admitted State UCC and (iii) under Section 9-103 of the
Non-Admitted State UCC, what law governs perfection of the security
interests granted in the collateral covered by this opinion;
(b) we express no opinion as to collateral of a type perfected
by means other than the filing of a financing statement under the
Non-Admitted State UCC;
(c) we express no opinion with respect to collateral consisting
of goods which are or are to become fixtures, equipment used in farming
operations, or farm products, or accounts or general intangibles arising
from or relating to the sale of farm products by a farmer, consumer goods,
crops growing or to be grown, timber to be cut or minerals or the like
(including oil and gas), or accounts subject to subsection 5 of Section
9-103 of the Non-Admitted State UCC;
(d) we call to your attention that we have not considered the
effect of any tax laws or other similar laws of the Non-Admitted State
which may require the payment of a tax or fee in connection with the filing
of the Non-Admitted State Financing Statements and we express no opinion
regarding any tax or fee payable in connection with the filing of the
Non-Admitted State Financing Statement (including, without limitation, the
existence or calculation of any such tax or fee); and
(e) we have assumed that the Company's only place of business
in Virginia is and will be located at 2345 Crystal Drive, Arlington, VA
22227.
9. The Indenture Trustee acting in behalf of the holders of
the Equipment Notes will be entitled to the benefits of Section 1110 of the
Bankruptcy Code with respect to the Aircraft if US Airways is a debtor in a
case under Chapter 11 of the Bankruptcy Code.
10. [US Airways, as lessor under the lease to US Airways
Shuttle, will be entitled to the benefits of Section 1110 of the Bankruptcy
Code with respect to the Aircraft if US Airways Shuttle is a debtor in a
case under Chapter 11 of the Bankruptcy Code.](2)
With respect to our opinion[s] in paragraph[s] 9 [and 10], we
note that a 1998 decision, Western Pacific Airlines, Inc. v. GATX (In re
Western Pacific Airlines, Inc.), 219 B.R. 305, on rehearing, 221 B.R. 1 (D.
Colo. 1998), appeal dismissed as moot, vacatur denied, Boullioun Aircraft
Holding Co., Inc. v. Smith Management (In re Western Pacific Airlines,
Inc.), 1999 WL 459469 (10th Cir. July 7, 1999), ruled that Section 1110
does not apply in a case after the trustee timely makes the agreement
specified in Section 1110(a)(1)(A) and timely cures defaults outstanding as
of the date of the Chapter 11 petition or that occur during the first sixty
days of the case, with the result, among others, that the ability of an
Indenture Trustee to exercise remedies based on a default that occurs after
the first sixty days of the Chapter 11 case would be subject to the
automatic stay. We believe that this decision construes Section 1110 in a
manner that is inconsistent with both the language of Section 1110 and the
legislative history explaining the purpose and operation of Section 1110.
Accordingly, we believe that the decision is an incorrect interpretation of
Section 1110.
In addition, with respect to our opinion[s] in paragraph[s] 9
[and 10], we have, with your consent, relied on the US Airways Opinion to
the effect that [each of] US Airways [and US Airways Shuttle] is a "citizen
of the United States," as defined in Section 40102 of Title 49 of the
United States Code, and [each of US Airways and US Airways Shuttle] holds
an air carrier operating certificate issued by the Secretary of
Transportation pursuant to Chapter 447 of the United States Code for
aircraft capable of carrying ten or more individuals or 6,000 pounds or
more of cargo and we have assumed that the security interest of the
Indenture Trustee in the Aircraft is perfected.
Our opinions are subject to the following assumptions and
qualifications:
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(2) All bracketed language is for Aircraft leased to US Airways Shuttle.
(a) enforcement of the Transaction Documents may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in equity
or at law);
(b) certain of the remedial provisions with respect to the
security including waivers with respect to the exercise of remedies against
the Trust Indenture Estate contained in the Trust Indenture, as
supplemented by the Indenture Supplement, may be unenforceable in whole or
in part, but the inclusion of such provisions does not affect the validity
of each of the Trust Indenture, as supplemented by the Indenture
Supplement, taken as a whole, and the Trust Indenture, as supplemented by
the Indenture Supplement, taken as a whole, together with applicable law,
contains adequate provisions for the practical realization of the security
thereof;
(c) we express no opinion as to the effect on the opinions
expressed herein of (i) the compliance or non-compliance of any party
(without in any way limiting other qualifications and assumptions made
herein, other than US Airways) to the Transaction Documents with any state,
federal or other laws or regulations applicable to it or (ii) the legal or
regulatory status or the nature of the business of any such party;
(d) we express no opinion as to the enforceability of any
rights to contribution or indemnification provided for in the Transaction
Documents to the extent any such rights are violative of the public policy
(including, without limitation, the public policy underlying any federal or
state securities law, rule or regulation);
(e) we express no opinion as to any provision of any
Transaction Document that provides a penalty or to the extent that it
provides for an absolute and unconditional obligation to perform such
Transaction Document even though such Transaction Document is invalid or
terminated or such performance would be illegal; and
(f) with respect to our opinion that the New York choice of law
provision in the Transaction Documents which are expressly governed by New
York law is enforceable, we rely upon, among other things, the Act of July
19, 1984, Ch. 421, 1984 McKinney's Sess. Laws of N.Y. 1406, (codified at
N.Y. Gen. Oblig. Law ss.ss. 5-1401, 5-1402 (McKinney Supp. 1986) and N.Y.
CPLR 327(b) (McKinney Supp. 1986) (the "Act"), and our opinion is subject
to the qualifications that such enforceability (i) may be limited by public
policy considerations of any jurisdiction, other than the courts of the
State of New York, in which enforcement of such provisions, or of a
judgement upon an agreement containing such provisions, is sought, and (ii)
as specified in the Act, does not apply to the extent provided to the
contrary in subsection two of Section 1-105 of the Uniform Commercial Code
for the State of New York.
In rendering the foregoing opinions, we have assumed, with your
consent, that:
(a) each of the Transaction Documents constitutes the legal,
valid and binding obligation of each party thereto (other than US Airways
and, in the case of the Trust Indenture, the Indenture Trustee) enforceable
against each such party (other than US Airways and, in the case of the
Trust Indenture, the Indenture Trustee) in accordance with its terms;
(b) each of (i) State Street Bank and Trust Company of
Connecticut, National Association and (ii) US Airways is duly organized and
validly existing in good standing under the laws of the jurisdiction of its
organization;
(c) each of (i) State Street Bank and Trust Company of
Connecticut, National Association, individually and as Indenture Trustee,
Subordination Agent and Pass Through Trustee, (ii) US Airways has full
power, authority and legal right to enter into and perform its respective
obligations under, and consummate the transactions contemplated by, each of
the Transaction Documents to which it is a party;
(d) each of (i) State Street Bank and Trust Company of
Connecticut, National Association, individually and as Indenture Trustee,
Subordination Agent and Pass Through Trustee, and (ii) US Airways has duly
authorized, executed and delivered each of the Transaction Documents to
which it is a party;
(e) the execution, delivery and performance of the Transaction
Documents by each of the parties thereto and the consummation of the
transactions contemplated thereby does not and will not conflict with,
contravene, violate or constitute a default under (i) the respective
certificate of incorporation, by-laws or other organizational documents of
any such party, (ii) any indenture, mortgage, lease, agreement or other
instrument to which any such party is a party or by which it or any of its
property may be bound or subject, (iii) any law, rule or regulation of any
jurisdiction (provided that we make no such assumption with respect to
Applicable Laws of the State of New York and Applicable Laws of the United
States of America insofar as such Applicable Laws apply to US Airways, as
to which we express our opinion in paragraph 2 herein) or (iv) any judicial
or administrative order or decree of any governmental authority; and
(f) except for (i) the due and timely filing and, where
appropriate, recording of the Trust Indenture and the Indenture Supplement
covering the Aircraft attached as an exhibit pursuant to the Transportation
Code, (ii) the registration of the issuance and sale of the Pass Through
Certificates under the Securities Act, (iii) compliance with the securities
law of each applicable state and (iv) the filing of appropriate UCC
financing statements, no consent, license, permit or approval of, or giving
of notice to, or registration with, or taking of any action in respect of,
any governmental authority of any jurisdiction is required in connection
with (X) the execution, delivery and performance by any party to any
Transaction Document of the respective Transaction Documents to which it is
a party, (Y) the consummation of the transactions contemplated thereby or
(Z) the legality, validity or enforceability of the Transaction Documents
with respect to any party to any Transaction Document (provided that we
make no such assumption with respect to those required by Applicable Laws
as such Applicable Laws apply to US Airways).
With respect to US Airways, we understand that you are
separately receiving an opinion with respect to certain matters set forth
above from Howard L. Wu, Esq., Associate General Counsel to US Airways (the
"US Airways Opinion"). With respect to Transportation Code matters, we
understand that you are separately receiving an opinion with respect to
certain matters set forth above from Crowe & Dunlevy, P.C., special
Transportation Code counsel (the "TC Opinion"). With respect to the
Indenture Trustee, the Pass Through Trustee and the Subordination Agent, we
understand that you are separately receiving an opinion with respect to
certain matters set forth above from Bingham Dana LLP, special counsel to
the Indenture Trustee, the Pass Through Trustee and the Subordination Agent
(the "State Street Opinion;"and together with the US Airways Opinion and
the TC Opinion, the "Other Counsel's Opinions"). We are advised that such
Other Counsel's Opinions contain qualifications. Our opinions herein stated
are based upon the assumptions specified above, and we express no opinion
as to the effect on the opinions herein stated of the qualifications stated
in the Other Counsel's Opinions.
This opinion is being furnished only to you and is solely for
your benefit and is not to be used, circulated, quoted, relied upon or
otherwise referred to by any other Person or for any other purpose without
our prior written consent.
Very truly yours,
SCHEDULE I
State Street Bank and Trust Company of Connecticut, National Association,
individually and as Indenture Trustee, Pass Through
Trustee and Subordination Agent
Standard & Poor's Ratings Services
55 Water Street
New York, New York 10041
Officer's Certificate to SASM&F (Illinois) Opinion
N_________
EXHIBIT A
Certificate
The undersigned, Howard L. Wu, is the Associate General Counsel
of US Airways, Inc., a Delaware corporation (the "Lessee"), and understands
that pursuant to certain of the Transaction Documents (as defined in the
Opinion referred to below), Skadden, Arps, Slate, Meagher & Flom (Illinois)
("SASM&F") is rendering an opinion dated the date hereof (the "Opinion") to
each of the Persons listed on Schedule I thereto. Capitalized terms used
herein but not otherwise defined shall have the meanings set forth in the
Opinion. The undersigned further understands that SASM&F is relying on this
officer's certificate and the statements made herein in rendering such
Opinion.
With regard to the foregoing, on behalf of the Lessee, the
undersigned certifies that:
1. Due inquiry has been made of all persons deemed necessary or
appropriate to verify or confirm the statements contained herein.
2. SASM&F may rely upon the representations and warranties that
the Lessee has made in each of the Transaction Documents to which it is a
party. The undersigned has made a careful review of the representations and
warranties of the Lessee contained in each of the Transaction Documents and
hereby confirms, to the best of his knowledge and belief, that such
representations and warranties are true, correct and complete on and as of
the date of this certificate.
3. Less than 25 percent of the assets of Lessee and its
subsidiaries on a consolidated basis and on an unconsolidated basis consist
of margin stock (as such term is defined in Regulation U of the Board of
Governors of the Federal Reserve System).
4. Lessee is engaged primarily, directly and through its
wholly-owned subsidiaries and its Majority-Owned Subsidiaries (as
hereinafter defined), in the airline transportation business and (i) is not
and does not hold itself out as being, engaged primarily nor does it
propose to engage primarily, in the business of investing, reinvesting or
trading in Securities (as hereinafter defined), (ii) has not and is not
engaged in, and does not propose to engage in, the business of issuing
Face-Amount Certificates of the Installment Type (as hereinafter defined)
and has no such certificate outstanding and (iii) is not engaged and does
not propose to engage in the business of investing, reinvesting, owning,
holding or trading in Securities, whether or not as its primary activity,
and does not own or propose to acquire Investment Securities (as
hereinafter defined) having a Value exceeding 40% of the Value of the total
assets of the Lessee (exclusive of Government Securities (as hereinafter
defined)) on an unconsolidated basis.
5. Neither the Lessee nor any of its subsidiaries or
affiliates owns or operates facilities that are used for the generation,
transmission, or distribution of electric energy for sale ("electric
utility facilities").
6. Neither the Lessee nor any of its subsidiaries or
affiliates owns or operates facilities that are used for the distribution
at retail of natural or manufactured gas for heat, light, or power ("gas
utility facilities").
7. Neither the Lessee nor any of its subsidiaries or
affiliates, directly or indirectly, or through one or more intermediary
companies, owns, controls or holds with power to vote (a) five percent (5%)
or more of the outstanding securities, such as notes, drafts, stock,
treasury stock, bonds, debentures, certificates of interest or
participation in any profit sharing agreements or in oil, gas, other
mineral royalties or leases, collateral-trust certificates, preorganization
certificates or subscriptions, transferable shares, investment contracts,
voting-trust certificates, certificate of deposit for a security,
receiver's or trustee's certificates, or any other instrument commonly
known as a "security" (including certificates of interest or participation
in, temporary or interim certificates for, receipt for, guaranty of,
assumption of liability on, or warrants or right to subscribe to or
purchase any of the foregoing) presently entitling it to vote in the
direction or management of, or any such instrument issued under or pursuant
to any trust, agreement, or arrangement whereby a trustee or trustees or
agent or agents for the owner or holder of such instrument is presently
entitled to vote in the direction or management of, any corporation,
partnership, association, joint-stock Company, joint venture or trust that
owns or operates any electric utility facilities or gas utility facilities,
or (b) any other interest, directly or indirectly, or through one or more
intermediary entities, in any corporation, partnership, association,
joint-stock Company, joint venture or trust that owns or operates any
electric utility facilities or gas utility facilities.
8. Neither the Lessee nor any of its subsidiaries or affiliates
has received notice that the Securities and Exchange Commission has
determined, or may determine, that the Lessee or any of its subsidiaries or
affiliates exercises a controlling influence over the management or
direction of the policies of a gas utility Company or an electric utility
Company as to make it subject to the obligations, duties and liabilities
imposed on holding companies by the Public Utility Holding Company Act of
1935, as amended.
9. As used in paragraph 4 of this certificate, the following
terms shall have the following meanings:
"Control" means the power to exercise a controlling influence
over the management or policies of a Company, unless such power is solely
the result of an official position with such Company;
"Face-Amount Certificate of the Installment Type" means any
certificate, investment contract, or other Security that represents an
obligation on the part of its issuer to pay a stated or determinable sum or
sums at a fixed or determinable date or dates more than 24 months after the
date of issuance, in consideration of the payment of periodic installments
of a stated or determinable amount;
"Government Securities" means all Securities issued or
guaranteed as to principal or interest by the United States, or by a person
controlled or supervised by and acting as an instrumentality of the
government of the United States pursuant to authority granted by the
Congress of the United States; or any certificate of deposit for any of the
foregoing;
"Investment Securities" includes all Securities except (A)
Government Securities, (B) Securities issued by employees' securities
companies, and (C) Securities issued by Majority-Owned Subsidiaries of the
Lessee which are not engaged and do not propose to be engaged in activities
within the scope of clause (i), (ii) or (iii) of paragraph 4 of this
Certificate;
"Majority-Owned Subsidiary" of a person means a Company 50% or
more of the outstanding Voting Securities of which are owned by such
person, or by a Company which, within the meaning of this paragraph, is a
Majority-Owned Subsidiary of such person. Notwithstanding the foregoing, a
Company shall not be considered a Majority-Owned Subsidiary of a person if
Control of such Company rests with someone other than such person;
"Security" means any note, stock, treasury stock, bond,
debenture, evidence of indebtedness, certificate of interest or
participation in any profit-sharing agreement, collateral-trust
certificate, preorganization certificate or subscription, transferrable
share, investment contract, voting-trust certificate, certificate of
deposit for a security, fractional undivided interest in oil, gas, or other
mineral rights, any put, call, straddle, option, or privilege on any
security (including a certificate of deposit) or on any group or index of
securities (including any interest therein or based on the value thereof),
or any put, call, straddle, option, or privilege entered into on a national
securities exchange relating to foreign currency, or, in general, any
interest or instrument commonly known as a "security," or any certificate
of interest or participation in, temporary or interim certificate for,
receipt for, guarantee of, or warrant or right to subscribe to or purchase,
any of the foregoing;
"Value" means (i) with respect to Securities owned at the end
of the last preceding fiscal quarter for which market quotations are
readily available, the market value at the end of such quarter; (ii) with
respect to other Securities and assets owned at the end of the last
preceding fiscal quarter, fair value at the end of such quarter, as
determined in good faith by or under the direction of the board of
directors; and (iii) with respect to securities and other assets acquired
after the end of the last preceding fiscal quarter, the cost thereof;
"Voting Security" means any security presently entitling the
owner or holder hereof to vote for the election of directors of a Company.
IN WITNESS WHEREOF, the undersigned has executed this
certificate this ___ day of ______, 1999.
__________________________________
Name: Howard L. Wu
Title: Associate General Counsel
Exhibit B-2
[LETTERHEAD OF US AIRWAYS, INC.]
[OWNED AIRCRAFT OPINION]
-------------- --, ----
To Each Person Listed on
Schedule I Hereto
Re: US Airways, Inc. Trust No. N___US
Ladies and Gentlemen:
I am the _____________________ of US Airways, Inc., a Delaware
corporation ("US Airways"), and am familiar with the transactions
contemplated by the Participation Agreement (US Airways, Inc. Trust No.
N___U_), dated as of ______________ __, ____ (the "Participation
Agreement"), among US Airways, State Street Bank and Trust Company of
Connecticut, a national banking association, not in its individual capacity
except as otherwise provided therein but solely as Pass Through Trustee,
Indenture Trustee and Subordination Agent relating to the Aircraft (as
defined below). Capitalized terms not otherwise defined herein have the
meanings assigned thereto in Annex A to the Participation Agreement.
This opinion is being delivered pursuant to Section 4[(a)(xi)]
of the Participation Agreement.
In my examination, I have assumed the genuineness of all
signatures, including endorsements, the legal capacity of natural persons,
the authenticity of all documents submitted to me as originals, the
conformity to original documents of all copies submitted to me as
telefacsimile, certified or photostatic copies, and the authenticity of the
originals of such copies. As to any facts material to this opinion, I have
relied solely upon statements, representations and warranties of US
Airways, the Indenture Trustee, the Subordination Agent, the Pass Through
Trustee and their respective officers and representatives, and others in
the Operative Documents and of public officials, and I have made no
independent investigation or inquiry with respect to such factual matters.
In rendering the opinions set forth herein, I have examined and
relied on executed originals or copies of the following:
(a) the Participation Agreement;
(b) the Trust Indenture;
(c) the Trust Supplement;
(d) the Equipment Notes;
(e) the Pass Through Trust Agreement;
(f) each of the Pass Through Trust Supplements;
(g) certified copies of the Certificate of
Incorporation and By-laws of US Airways;
(h) certified copies of certain resolutions of the Board
of Directors of US Airways adopted on ____________;
(i) a certificate of good standing from the Secretary of
State of the State of Delaware as to the good standing of
US Airways in such jurisdiction; and
(j) such other documents as I have deemed necessary or
appropriate as a basis for the opinions set forth below.
Based on the foregoing, it is my opinion that:
1. US Airways is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware, is a
"citizen of the United States" within the meaning of Section 40102(a)(15)
of the Transportation Code, and has or had, on the date of execution
thereof, the corporate power and authority to carry on its business as
currently conducted and to enter into and perform its obligations under
each of the Operative Documents to which it is a party. US Airways is duly
qualified to do business and is in good standing in the State of Virginia
and each other state of the United States in which its operations or the
nature of its business requires US Airways to so qualify, except where the
failure to so qualify would not have a material adverse effect on US
Airways or its business.
2. US Airways possesses all necessary certificates, franchises,
licenses, permits, rights and concessions and consents which are material
to the operation of the routes flown by it and the conduct of its business
and operations as currently conducted, and each such certificate,
franchise, license, permit, right and concession and consent is in full
force and effect, except where any failure would not have a material
adverse effect on US Airways or its business.
3. Each of the Operative Documents to which US Airways is a
party has or had, on the date of execution thereof, been duly authorized,
executed and delivered by US Airways.
4. Neither the execution and delivery by US Airways of any of
the Operative Documents to which US Airways is a party, nor the
consummation of any of the transactions by US Airways contemplated thereby,
nor the performance of the obligations thereunder by US Airways, did at the
time of execution and delivery, or does presently (a) require any
stockholder approval or violate the certificate of incorporation or By-laws
of US Airways or (b) conflict with or contravene the provisions of, or
constitute a default under, or result in the creation of any Lien (other
than any Permitted Lien) upon the property of US Airways under any law,
governmental rule or regulation, or the charter or By-laws of US Airways or
any order, writ, injunction or decree of any court or governmental
authority against US Airways or by which any of its properties may be bound
or any material indenture, mortgage, contract or other agreement known to
me to which US Airways is a party or by which it may be bound, or require
the approval or consent of any trustee or the holders of any indebtedness
or material obligations of US Airways.
5. Neither the execution and delivery by US Airways of any of
the Operative Documents to which it is a party, nor the consummation of any
transactions by US Airways contemplated thereby, nor the performance of the
obligations thereunder by US Airways, did or does, as the case may be, (a)
require the consent or approval of, the giving of notice to, or (except as
described or contemplated in the Operative Documents, all of which were or
are required to be performed on or prior to the Delivery Date and which
were or shall have been accomplished on or prior to the Delivery Date) the
registration with, or the taking of any other action in respect of, the
FAA, the Securities and Exchange Commission or any other authority or
agency of the federal government or of the State of Virginia other than (i)
the registration of the issuance and sale of the Pass Through Certificates
under the Securities Act, (ii) compliance with the securities laws of each
applicable state and (iii) the filings and, where appropriate, recording,
pursuant to the Transportation Code, of the Trust Indenture (with the Trust
Indenture and Trust Supplement covering the Aircraft attached as an
exhibit), or (b) contravene any judgment or order applicable to or binding
on US Airways or any law or governmental rule or regulation of the United
States or of the State of Virginia.
6. There is no pending or, to my knowledge, threatened action
or proceeding before any court or administrative agency which individually
(or in the aggregate in the case of any group of related lawsuits) (i) is
expected to have a material adverse effect on (A) the financial condition
of US Airways except for the matters described under "Legal Proceedings" in
US Airways' Annual Report on Form 10-K for the fiscal year ended December
31, 1998 and US Airways' Quarterly Report on Form 10-Q for the quarter
ended ______________, as to all of which I can express no opinion at this
time concerning US Airways' liability (if any) or the effect of any adverse
determination upon the business, condition (financial or otherwise) or
operations of US Airways, or (B) the ability of US Airways to perform its
obligations under the Operative Documents, or (ii) involves the Aircraft.
7. US Airways is a duly certificated "air carrier" within the
meaning of the Transportation Code, and a holder of a certificate under
Sections 41102(a) and 41103 of the Transportation Code, and an "air carrier
operating certificate" issued under Chapter 447 of the Transportation Code
for aircraft capable of carrying ten (10) or more individuals or 6,000
pounds or more of cargo, and each such certificate is in full force and
effect.
8. US Airways is not, and is not directly or indirectly
controlled by or acting on behalf of any Person which is, an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended.
[9. Shuttle, Inc. ("US Airways Shuttle") is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Delaware and is a "citizen of the United States" within the
meaning of Section 40102(a)(15) of the Transportation Code.
10. US Airways Shuttle is a duly certificated "air carrier"
within the meaning of the Transportation Code, and is a holder of a
certificate under Sections 41102(a) and 41103 of the Transportation Code,
and an "air carrier operating certificate" issued under Chapter 447 of the
Transportation Code for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, and each such certificate is
in full force and effect.]1
I do not express any opinion as to matters governed by
any law other than the federal laws of the United States of America and the
corporation law of the State of Delaware.
This opinion is delivered to you solely for your use in
connection with the transaction described herein, and may not be used for
any other purpose, and may not be relied upon by any other person, without
my prior written consent.
Very truly yours,
- -----------------------------
1 For transactions with Aircraft leased or subleased to US
Airways Shuttle only.
FORM OF OPINION OF CLIFFORD CHANCE
FOR THE MANUFACTURER
To: US Airways Inc.
US Airways Group, Inc.
First Security Bank, National Association
[ ]
RE: ONE AIRBUS [ ] AIRCRAFT
MANUFACTURER'S SERIAL NO. [ ]
US REGISTRATION NO. [ ]
Dear Sirs,
1. We have been requested by US Airways Inc. (the "COMPANY"), to act
as special French counsel with respect, and to render this opinion
in connection with certain of the transactions contemplated in a
certain Participation Agreement dated as of [ ] (the
"PARTICIPATION AGREEMENT") among [ ].
2. We have examined copies (which we assume conform to the originals) of:
(i) the purchase agreement assignment (Scheduled August, 1999
through April, 2000 Deliveries) dated as of August 1,
[1999] between US Airways Group, Inc. (as assignor) and
the Company (as assignee) (the "FIRST PURCHASE AGREEMENT
ASSIGNMENT");
(ii) the consent and agreement of AVSA S.A.R.L. ("AVSA") and
Airbus Industrie G.I.E. ("AIRBUS") to the First Purchase
Agreement Assignment as acknowledged and accepted by US
Airways Group, Inc. and the Company dated as of August 1,
[1999] (the "FIRST CONSENT");
(iii) the purchase agreement assignment (US Airways, Inc. Trust
No. N[ ]U[ ]), dated as of [ ], between the Company (as
assignor) and State Street Bank and Trust company of
Connecticut, National Association (the "INDENTURE
TRUSTEE") as assignee) (the "SECOND
PURCHASE AGREEMENT ASSIGNMENT");
(iv) the consent and agreement of Airbus (to the Second
Purchase Agreement Assignment) dated as of [ ] (the
"AIRBUS CONSENT AND AGREEMENT");
(v) the consent and agreement of AVSA (to the Second Purchase
Agreement Assignment) dated as of [ ] (the "AVSA CONSENT
AND AGREEMENT");
(vi) the pledge agreement dated [ ] made between the Company
(as pledgor) and the Indenture Trustee (as pledgee, the
"PLEDGE AGREEMENT"),
the documents referred to in (i) to (vi) above are hereinafter
referred to collectively as the "DOCUMENTS."
3. In considering the above, we have assumed:
(i) that the Documents have been duly executed by the parties
thereto (other than Airbus and AVSA);
(ii) the genuineness of all signatures;
(iii) the completeness and conformity to the originals of all
documents supplied to us as copies or as facsimiles;
(iv) that the Documents expressed to be governed by New York
law constitute the legal, valid and binding obligations
of the parties thereto under New York law.
4. Having considered the Documents we are of the opinion, subject to
the qualifications and reservations set out in paragraph 5 below,
that:
(i) Airbus is a groupement d'interet economique duly
organised and existing under the laws of the French
Republic and has the power and authority to carry on its
business as now conducted. The present members of Airbus
are (i) Aerospatiale, Societe Nationale Industrielle,
(ii) DaimlerChrysler Aerospace Airbus GmbH, (iii) British
Aerospace (Operations) Ltd. and (iv) Construcciones
Aeronauticas S.A. and each of such corporations is,
without the need to proceed against any collateral
security for the indebtedness of Airbus or to take any
other legal action or process (except for service
on Airbus by huissier of notice to perform and subsequent
failure by Airbus to do so), jointly and severally liable
with the other members for the debts of Airbus arising
out of obligations contracted by Airbus while such
corporation is a member of Airbus;
(ii) AVSA is a societe a responsabilite limitee duly
established and existing under the laws of the French
Republic and has the power and authority to carry on its
business as now conducted;
(iii) each of Airbus and AVSA has full power and authority to
enter into and to execute, deliver and perform its
obligations under the Documents to which it is a party;
such obligations are legal, valid and binding upon them
respectively, are enforceable in accordance with their
respective terms and rank pari passu with the other
unsecured obligations of Airbus and AVSA, as the case may
be;
(iv) assuming that under New York law the Indenture Trustee
would be entitled to take proceedings in its own name and
on its own account to recover from the Company the full
amount of all amounts secured by the Pledge Agreement,
the Pledge Agreement:
(a) duly creates for the benefit of the Indenture
Trustee the security interests which the Pledge
Agreement purports to create and the Indenture
Trustee is entitled to the benefits and security
afforded thereby; and
(b) subject to the registration and huissier
requirements of paragraph 5(d) hereof and the
observation set forth in paragraph 5(f) hereof
and with respect to non-monetary claims, should
be effective as against Airbus, AVSA and third
parties to perfect the pledge of the obligations
of Airbus and AVSA that are the subject of the
Pledge Agreement; and
(c) subject to the registration and huissier
requirements of paragraph 5(d) hereof and with
respect to monetary claims, would be effective
as against Airbus, AVSA and third parties to
perfect the pledge of the obligations of Airbus
and AVSA that are the subject of the Pledge
Agreement;
(v) the choice of the laws of the State of New York to govern
the Documents (which are expressed to be so governed) is
valid under the laws of the French Republic, and a French
court would uphold such choice of law in any suit on the
Documents brought in a French court.
5. This opinion must be read subject to the following qualifications
and observations as to French law:
(a) the remedy of specific performance may not be
available in a French court;
(b) in respect of payment obligations, a French
court has power under Article 1244-1 of the
French Civil Code to grant time to a debtor (not
in excess of two years), taking into account the
position of the debtor and the needs of the
creditor;
(c) in order to ensure that the validity as against
third parties of the assignment made in the
First Purchase Agreement Assignment, it is
necessary that notice of such assignment be
served on Airbus and AVSA by huissier in
accordance with the provisions of Article 1690
of the French Civil Code. We have been
instructed by the Company to assist in carrying
out such formalities which we intend to do upon
receipt of duly executed originals of such
assignment and we anticipate that there will be
no difficulty in accomplishing these
formalities;
(d) in order to ensure the validity as against third
parties of the assignment and the pledge
(nantissement) created by the Second Purchase
Agreement Assignment and the Pledge Agreement
respectively in accordance with the provisions
of Article 2075 of the French Civil Code, it is
necessary for each such document to be
registered with the French tax administration in
a form duly translated in French by a sworn
translator, involving payment of a stamp duty of
a nominal amount. In addition, the assignment
created by the Second Purchase Agreement
Assignment and the nantissement created by the
Pledge Agreement will need to be served on each
of the obligors by huissier, in accordance with
the provisions of Article 2075 of the French
Civil Code. We have been instructed by the
Company to carry out such formalities on its
behalf which we intend to do upon receipt of
duly executed originals of each such document
and we anticipate that there will be no
difficulty in accomplishing these formalities;
(e) in the event of any proceedings being brought in
a French court in respect of a monetary
obligation expressed to be payable in a currency
other than French Francs or euros, a French
court would probably give judgment expressed as
an order to pay, not such currency, but its
French Franc or euro equivalent at the time of
payment or enforcement of judgment. With respect
to a bankruptcy, insolvency, liquidation,
moratorium, reorganization, reconstruction or
similar proceedings, French law may require that
all claims or debts be converted into French
Francs or euros at an exchange rate determined
by the court at a date related thereto, such as
the date of commencement of a winding-up;
(f) pledges over non-monetary claims are unusual
under French law. In principal, pledges over
claims of this type should be effective against
AVSA and third parties but in the absence of
case law, there is a lack of certainty about the
pledge being effective;
(g) a determination or certificate as to any matter
provided for in the Documents might be held by a
French court not to be final, conclusive or
binding, if such determination or certificate
could be shown to have an unreasonable,
incorrect or arbitrary basis or not to have been
given or made in good faith;
(h) claims may become barred by effluxion of time or
may be or become subject to defense of set-off
or counterclaim;
(i) a French court may stay proceedings if
concurrent proceedings are being brought
elsewhere;
(j) we express no opinion as to whether any
provision in the documents conferring a right of
set-off or similar right would be effective
against a liquidator or a creditor;
(k) the enforcement against Airbus of any of the
Documents to which it is a party may be limited
by applicable bankruptcy, insolvency,
arrangement, moratorium or similar laws relating
to or affecting the enforcement of creditors'
rights generally, as such laws are applied to
Airbus. The enforcement against AVSA of any of
the Documents to which it is a party may be
limited to such laws, as such laws are applied
to AVSA. The enforcement against any member of
Airbus of any obligation of Airbus contained in
the Documents may be limited to such laws, as
such laws are applied to such member;
(l) our opinion as to the enforceability of the
Documents relates only to their enforceability
in France in circumstances where the competent
French court has and accepts jurisdiction. The
term "enforceability" refers to the legal
character of the obligations assumed by the
parties under the Documents, i.e., that they are
of a character which French law enforces or
recognizes. It does not mean that the Documents
will be enforced in all circumstances or in
foreign, jurisdictions or by or against third
parties or that any particular remedy will be
available; and
(m) article 899 of the French Tax Code provides that
agreements evidencing an undertaking to pay a
sum of money are subject to stamp tax (droit de
timbre) of a nominal amount if made in the
French Republic, if made in a foreign country,
such agreements are subject to a stamp tax of a
nominal amount before certain use thereof can be
made in the French Republic (Article 897 of the
French Tax Code). However non-payment of such
stamp tax does not affect the legality, validity
or enforceability of the Documents.
We are qualified as French Avocats.
No opinion is expressed herein as to laws other than the laws of the French
Republic as of the date hereof. This opinion is for your use and that of no
one else, and is limited to (i) the matters specifically mentioned herein,
and (ii) the purpose set out above.
Yours faithfully,
CLIFFORD CHANCE
DRAFT OPINION OF CROWE & DUNLEVY
__________ __, 1999
To the Addressees on the
Schedule Attached Hereto
Re: Airbus Industrie model A319-____ [A320____ or A330___] aircraft
with manufacturer's serial number __________ and United States
nationality and registration marks N________ (the "Aircraft")
Ladies and Gentlemen:
This letter confirms that we filed with the Federal Aviation
Administration (the "FAA") today at __:__.M., C._.T., the Trust Indenture
and Security Agreement (US Airways, Inc. 1999-1 Series N____) dated as of
__________ __, 1999 (the "Indenture") between U.S. Airways, Inc. (the
"Company") and _____________________ as Indenture Trustee (the "Indenture
Trustee"), to which was attached Trust Agreement and Indenture Supplement
No. 1 (US Airways, Inc. 1999-1 Series N___) dated __________ __, 1999 (the
"Indenture Supplement") covering the aircraft and the _______________ model
______________ Aircraft engines with manufacturer's serial numbers
______________ and _______________ (the "Engines")
Based upon our examination of the above described instruments and
of such records of the FAA as we deemed necessary to render this opinion
and as were made available to us by the FAA, it is our opinion that:
(a) the Indenture with the Indenture Supplement attached is in due
form for recordation by and has been duly filed for recordation
with the FAA pursuant to and in accordance with the provisions of
Section 44107 of Title 49 of the United States Code;
(b) legal title to the Aircraft is vested in the Company and the
Aircraft is duly registered in the name of the Company pursuant
to and in accordance with the provisions of Sections 44102 and
44103 of Title 49 of the United States Code.
(c) the Aircraft and the Engines are free and clear of Liens (as such
term is defined in Annex A to the Indenture) other than such as
are created by the Indenture, as supplemented by the Indenture
Supplement;
(d) the Indenture, as supplemented by the Indenture Supplement,
creates a duly and validly perfected first priority security
interest in favor of the Indenture Trustee in the Aircraft and
the Engines;
(e) the Indenture, as supplemented by the Indenture Supplement, is
not required to be refiled with the FAA or filed or recorded in
any other place within the United States in order to perfect or
maintain the perfection of the security interest created thereby
in the Aircraft and the Engines under the applicable laws of any
jurisdiction within the United States;
(f) no other registration of the Aircraft and no filings or
recordings (other than the filings and recordings with the FAA
which have been effected) are necessary to perfect in any
jurisdiction within the United States the Company's title to the
Aircraft or the security interest created by the Indenture, as
supplemented by the Indenture Supplement, in the Aircraft and the
Engines under the applicable laws of any jurisdiction within the
United States; and
(g) no authorization, approval, consent, license or order of, or
registration with, or giving of notice to, the FAA Aircraft
Registry is required for the valid authorization, delivery or
performance of the Indenture and the Indenture Supplement except
for such authorizations, approvals, consents, licenses, orders,
registrations and notices as have been effected.
No opinion is herein expressed as to; (i) laws other than the
federal laws of the United States; (ii) the validity or enforceability
under local law of the Indenture, as supplemented by the Indenture
Supplement; (iii) the recognition of the perfection of the security
interest created by the Indenture, as supplemented by the Indenture
Supplement, as against third parties in any legal proceedings outside the
United States; and (iv) the record status of the Aircraft prior to the
commencement of its United States registration. Since our examination was
limited to records maintained by the FAA Aircraft Registry, our opinion
does not cover liens which are perfected without the filing of notice
thereof with the FAA, such as federal tax liens, liens arising under
Section 1368(a) of Title 29 of the United States Code and possessory
artisans' liens, and was subject to the accuracy of FAA personnel in the
filing, indexing and recording of instruments filed with the FAA and in the
search for encumbrance cross-reference index cards for the Engines.
Very truly Yours,
ROBIN D. JENSON
For the Firm
SCHEDULE
________________________ as Indenture Trustee, Pass Through Trustee and
Subordination Agent
US Airways, Inc.
Standard & Poor's Ratings Services
FORM OF OPINION OF BINGHAM DANA, SPECIAL COUNSEL
TO THE INDENTURE TRUSTEE
-------------, ------
TO THE PARTIES SET FORTH
IN SCHEDULE A HERETO
RE: US Airways, Inc./Secured Financing of One Airbus [A320] [A330-300]
Aircraft [N _____ US] - Indenture Trustee, Owned Aircraft
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity
("STATE STREET") and as Indenture Trustee (the "INDENTURE TRUSTEE") under
the Trust Indenture and Security Agreement [N ____ US] dated as of
[________________] (the "INDENTURE") between US Airways, Inc., and State
Street, as Indenture Trustee, in connection with the execution and delivery
of the Participation Agreement [N ____ US] dated as of [________________]
(the "PARTICIPATION AGREEMENT") by and among the Indenture Trustee, US
Airways, Inc., State Street, as Pass Through Trustee (the "PASS THROUGH
TRUSTEE"), State Street, as Subordination Agent (the "SUBORDINATION AGENT")
and the Owner Trustee and the transactions contemplated thereby.
Capitalized terms not otherwise defined herein shall have the meanings
specified in the Lease and Annex A of the Participation Agreement. This
opinion is being delivered pursuant to Section 4( )( ) of the Participation
Agreement.
Our representation of State Street and the Indenture Trustee has been
as special counsel for the limited purposes stated above. As to all matters
of fact (including factual conclusions and characterizations and
descriptions of purpose, intention or other state of mind), we have relied,
with your permission, entirely upon (i) the representations and warranties
of the parties set forth in the Operative Documents and (ii) certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations, warranties and
certificates.
We have examined the Participation Agreement and the Indenture (the
"OPERATIVE DOCUMENTS"), the Certificate of the Comptroller of the Currency
relating to State Street and originals, or copies certified or otherwise
identified to our satisfaction, of such other records, documents,
certificates, or other instruments as we have deemed necessary or advisable
for the purposes of this opinion. For purposes of our opinion rendered in
paragraph 1 below, with respect to the authority of State Street to operate
as a state-chartered trust company and exercise trust powers, our opinion
relies upon and is limited by such Certificate of the Comptroller of the
Currency.
We have assumed the genuineness of all signatures (other than those
on behalf of State Street and the Indenture Trustee), the conformity to the
originals of all documents reviewed by us as copies, and the authenticity
and completeness of all original documents reviewed by us in original or
copy form and the legal competence of each individual executing any
document (other than on behalf of State Street and the Indenture Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we
are aware or which are known to us, or with another similar qualification,
the relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion,
the individual lawyers in the firm who have participated directly in the
specific transactions to which this opinion relates and the partner of the
firm responsible for State Street corporate trust matters, and without any
special or additional investigation undertaken for the purposes of this
opinion.
Subject to the limitation set forth below, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions set forth below are limited solely to the internal
substantive laws of the State of Connecticut as applied by courts located
in Connecticut and the federal laws of the United States. No opinion is
given herein as to the choice of law or internal substantive rules of law
that any court or other tribunal may apply to the transactions contemplated
by the Operative Documents. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
no opinion is expressed as to matters governed by any law, statute, rule or
regulation of the United States relating to the acquisition, ownership,
registration, use, operation, maintenance, repair, replacement or sale of
or the nature of the Aircraft.
To the extent to which this opinion deals with matters governed by or
relating to the laws of the State of New York, or other jurisdiction other
than the State of Connecticut, by which the Operative Documents are stated
to be governed, we have assumed, with your permission that the Operative
Documents are governed by the internal substantive laws of the State of
Connecticut.
Our opinion is further subject to the following exceptions,
qualifications and assumptions:
(a) We have assumed without any independent investigation that
(i) each party to the Operative Documents, other than State Street, in its
individual capacity or as Indenture Trustee, as applicable, at all times
relevant thereto, is validly existing and in good standing under the laws
of the jurisdiction in which it is organized, and is qualified to do
business and in good standing under the laws of each jurisdiction where
such qualification is required generally or necessary in order for such
party to enforce its rights under such Operative Documents, and (ii) each
party to the Operative Documents, at all times relevant thereto, had and
has the full power, authority and legal right under its certificate of
incorporation, partnership agreement, by-laws, and other governing
organizational documents, and the applicable corporate, partnership, or
other enterprise legislation and other applicable laws, as the case may be
(other than State Street and the Indenture Trustee with respect to the laws
of the United States of America and the internal substantive laws of the
State of the Connecticut, but only in each case to the limited extent the
same may be applicable to State Street or the Indenture Trustee, and
relevant to our opinions expressed below) to execute, and to perform its
obligations under, the Operative Documents, and (iii) each party to the
Operative Documents (other than State Street or the Indenture Trustee, as
applicable) has duly executed and delivered each of such agreements and
instruments to which it is a party and that (other than with respect to
State Street and the Indenture Trustee, as applicable) the execution and
delivery of such agreements and instruments and the transactions
contemplated thereby have been duly authorized by proper corporate or other
organizational proceedings as to such party.
(b) We have assumed without any independent investigation (i)
that each of the Operative Documents is a valid, binding and enforceable
obligation of each party thereto other than State Street or the Indenture
Trustee, as applicable, and (ii) that each of the Operative Documents is a
valid, binding and enforceable obligation of State Street or the Indenture
Trustee, as applicable, to the extent that laws other than those of the
State of Connecticut are relevant thereto (other than the laws of the
United States of America, but only to the limited extent the same may be
applicable to State Street or the Indenture Trustee, as applicable, and
relevant to our opinions expressed below).
(c) The enforcement of any obligations of State Street or the
Indenture Trustee, as applicable, under any of the Operative Documents may
be limited by the receivership, conservatorship and supervisory powers of
bank regulatory agencies generally, as well as by bankruptcy, insolvency,
reorganization, moratorium, marshaling or other laws and rules of law
affecting the enforcement generally of creditors' rights and remedies
(including such as may deny giving effect to waivers of debtors' or
guarantors' rights); and we express no opinion as to the status under any
fraudulent conveyance laws or fraudulent transfer laws of any of the
obligations of State Street or the Indenture Trustee, as applicable, under
any of the Operative Documents.
(d) We express no opinion as the availability of any specific
or equitable relief of any kind.
(e) The enforcement of any of your rights may in all cases be
subject to an implied duty of good faith and fair dealing and to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity) and, as to any of your
rights to collateral security, will be subject to a duty to act in a
commercially reasonable manner.
(f) We express no opinion as to the enforceability of any
particular provision of any of the Operative Documents relating to (i)
waivers of rights to object to jurisdiction or venue, or consents to
jurisdiction or venue, (ii) waivers of rights to (or methods of) service of
process, or rights to trial by jury, or other rights or benefits bestowed
by operation of law, (iii) waivers of any applicable defenses, setoffs,
recoupments, or counterclaims, (iv) the grant of powers of attorney to any
person or entity, (v) exculpation or exoneration clauses, indemnity
clauses, and clauses relating to releases or waivers of unmatured claims or
rights, (vi) the imposition or collection of interest on overdue interest
or providing for a penalty rate of interest or late charges on overdue or
defaulted obligations, or the payment of any premium, liquidated damages,
or other amount which may be held by any court to be a "penalty" or a
"forfeiture," or (vii) so-called "usury savings clauses" purporting to
specify methods of (or otherwise assure) compliance with usury laws or
other similar laws of any jurisdiction.
(g) We express no opinion as to the effect of events occurring,
circumstances arising, or changes of law becoming effective or occurring,
after the date hereof on the matters addressed in this opinion letter, and
we assume no responsibility to inform you of additional or changed facts,
or changes in law, of which we may become aware.
(h) No opinion is given herein as to the effect of usury laws
(or other similar laws) of any jurisdiction with respect to the Operative
Documents.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their successors and assigns in connection
with the transactions contemplated by the Operative Documents and may not
be used or relied upon by any other person or for any other
purpose.
1. State Street is a national banking association, validly formed and
authorized to operate as a national banking association under the laws of
the United States of America and, in its individual capacity or as
Indenture Trustee, as the case may be, has the requisite corporate and
trust power and authority to execute, deliver and perform its obligations
under the Operative Documents and in its capacity as Indenture Trustee, to
authenticate the Equipment Notes issued on the date hereof.
2. State Street, in its individual capacity or as Indenture Trustee,
as the case may be, has duly authorized the Operative Documents by all
necessary corporate or trust action and has duly executed and delivered the
Operative Documents, and the Operative Documents constitute valid and
binding obligations of State Street, in its individual capacity or as
Indenture Trustee, as the case may be, enforceable against State Street, in
its individual capacity or as Indenture Trustee, as the case may be, in
accordance with their respective terms.
3. The Equipment Notes issued as of the date hereof have been duly
authenticated and delivered by State Street as Indenture Trustee pursuant
to the terms of the Indenture.
4. The authorization, execution, delivery and performance by State
Street, in its individual capacity or as Indenture Trustee, as the case may
be, of the Operative Documents and the consummation of the transactions
therein contemplated and compliance with the terms thereof do not and will
not result in the violation of the provisions of the charter documents or
by-laws of State Street and, to the best of our knowledge, do not conflict
with, or result in a breach of any terms or provisions of, or constitute a
default under, or result in the creation or the imposition of any lien,
charge or encumbrance upon any property or assets of State Street under any
indenture, mortgage or other agreement or instrument, in each case known to
us, to which State Street is a party or by which it is bound, or violates
any applicable Connecticut or federal law, rule or regulation governing
State Street's banking or trust powers, or, to the best of our knowledge,
of any judgment, order or decree, in each case known to us, applicable to
State Street of any court, regulatory body, administrative agency,
government or governmental body having jurisdiction over State Street.
5. No authorization, approval, consent, license or order of, giving
of notice to, registration with, or taking of any other action in respect
of, any federal or state governmental authority or agency pursuant to any
federal or Connecticut law governing the banking or trust powers of State
Street is required for the authorization, execution, delivery and
performance by State Street, in its individual capacity or as Indenture
Trustee, as the case may be, of the Operative Documents or the consummation
of any of the transactions by State Street, in its individual capacity or
as Indenture Trustee, as the case may be, contemplated thereby (except as
shall have been duly obtained, given or taken); and such authorization,
execution, delivery, performance, consummation and issuance do not conflict
with or result in a breach of the provisions of any such law.
6. There are no taxes, fees or other governmental charges payable
under the laws of the State of Connecticut or any political subdivision of
such State in connection with the execution and delivery by State Street,
in its individual capacity or as Indenture Trustee, as the case may be, of
the Operative Documents (except for taxes on any fees payable to State
Street in its individual capacity) which are imposed solely because State
Street has its principal place of business in Connecticut or performs its
administrative duties under the Operative Documents in Connecticut.
7. To our knowledge, but without having investigated any governmental
records or court dockets, and without having made any other independent
investigation, there are no proceedings pending or overtly threatened in
writing against or affecting State Street in any court or before any
governmental authority, agency, arbitration board or tribunal which, if
adversely determined, individually or in the aggregate, could reasonably be
expected to affect materially and adversely the trust related to the
Indenture or affect the right, power and authority of State Street, in its
individual capacity or as Indenture Trustee, as the case may be, to enter
into or perform its obligations under the Operative Documents.
Very truly yours,
BINGHAM DANA LLP
SCHEDULE A
----------
State Street Bank and Trust Company of
Connecticut, National Association
US Airways, Inc.
US Airways Group, Inc.
Standard & Poor's Ratings Service
Moody's Investors Service, Inc.
Credit Suisse First Boston Corporation
FORM OF OPINION OF BINGHAM DANA, SPECIAL COUNSEL TO THE
PASS THROUGH TRUSTEE
- -------------------- --, ----
TO THE PARTIES SET FORTH
IN SCHEDULE A HERETO
RE: US Airways, Inc./Secured Financing of One Airbus [A320]
[A300-300] Aircraft [N _________ US] - Pass Through Trust,
Owned Aircraft
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity
("STATE STREET") and as Pass Through Trustee (the "PASS THROUGH TRUSTEE")
under the Pass Through Trust Agreement dated as of June __, 1999, among US
Airways Group, Inc., US Airways, Inc. and State Street, as supplemented by
Trust Supplement No. [ ], Trust Supplement No. and [ ] and Trust Supplement
No. [ ] each dated as of [ ] and each among US Airways Group, Inc., US
Airways, Inc. and State Street (collectively, the "PASS THROUGH TRUSTS"
and, individually, a "PASS THROUGH TRUST") in connection with the execution
and delivery of the Participation Agreement [N ] dated as of [ ] (the
"PARTICIPATION AGREEMENT") by and among State Street, as Indenture Trustee,
US Airways, Inc., State Street, as Pass Through Trustee and State Street,
as Subordination Agent (the "SUBORDINATION AGENT") and the transactions
contemplated thereby. Capitalized terms not otherwise defined herein shall
have the meanings specified in the Lease and Annex A of the Participation
Agreement. This opinion is being delivered pursuant to Section 4( )( ) of
the Participation Agreement.
Our representation of State Street and the Pass Through Trustee has
been as special counsel for the limited purposes stated above. As to all
matters of fact (including factual conclusions and characterizations and
descriptions of purpose, intention or other state of mind), we have relied,
with your permission, entirely upon (i) the representations and warranties
of the parties set forth in the Operative Documents and (ii) certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations, warranties and
certificates.
We have examined the Participation Agreement, the Liquidity Facility
for each of the Class A, Class B and Class C Trusts, the Intercreditor
Agreement, the Note Purchase Agreement, the Escrow and Paying Agent
Agreement for each of the Class A, Class B and Class C Trusts each dated as
of ______________ __, ____ and each among First Security Bank, National
Association, as Escrow Agent, the underwriters named therein, State Street,
as Pass Through Trustee and State Street, as Paying Agent, and each of the
Pass Through Trusts (the "OPERATIVE DOCUMENTS"), the Certificate of the
Comptroller of the Currency relating to State Street and originals, or
copies certified or otherwise identified to our satisfaction, of such other
records, documents, certificates, or other instruments as we have deemed
necessary or advisable for the purposes of this opinion. For purposes of
our opinion rendered in paragraph 1 below, with respect to the authority of
State Street to operate as a national banking association and exercise
trust powers, our opinion relies upon and is limited by such Certificate of
the Comptroller of the Currency.
We have assumed the genuineness of all signatures (other than those
on behalf of State Street and the Pass Through Trustee), the conformity to
the originals of all documents reviewed by us as copies, and the
authenticity and completeness of all original documents reviewed by us in
original or copy form and the legal competence of each individual executing
any document (other than on behalf of State Street and the Pass Through
Trustee).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we
are aware or which are known to us, or with another similar qualification,
the relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion,
the individual lawyers in the firm who have participated directly in the
specific transactions to which this opinion relates and the partner of the
firm responsible for State Street corporate trust matters, and without any
special or additional investigation undertaken for the purposes of this
opinion.
Subject to the limitation set forth below, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions set forth below are limited solely to the internal
substantive laws of the State of Connecticut as applied by courts located
in Connecticut and the federal laws of the United States. No opinion is
given herein as to the choice of law or internal substantive rules of law
that any court or other tribunal may apply to the transactions contemplated
by the Operative Documents. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
no opinion is expressed as to matters governed by any law, statute, rule or
regulation of the United States relating to the acquisition, ownership,
registration, use, operation, maintenance, repair, replacement or sale of
or the nature of the Aircraft.
To the extent to which this opinion deals with matters governed by or
relating to the laws of the State of New York, or other jurisdiction other
than the State of Connecticut, by which the Operative Documents are stated
to be governed, we have assumed, with your permission that the Operative
Documents are governed by the internal substantive laws of the State of
Connecticut.
Our opinion is further subject to the following exceptions,
qualifications and assumptions:
I. We have assumed without any independent investigation
that (i) each party to the Operative Documents, other than
State Street, in its individual capacity or as Pass Through
Trustee, as applicable, at all times relevant thereto, is
validly existing and in good standing under the laws of the
jurisdiction in which it is organized, and is qualified to do
business and in good standing under the laws of each
jurisdiction where such qualification is required generally or
necessary in order for such party to enforce its rights under
such Operative Documents, and (ii) each party to the Operative
Documents, at all times relevant thereto, had and has the full
power, authority and legal right under its certificate of
incorporation, partnership agreement, by-laws, and other
governing organizational documents, and the applicable
corporate, partnership, or other enterprise legislation and
other applicable laws, as the case may be (other than State
Street and the Pass Through Trustee with respect to the laws of
the United States of America and the internal substantive laws
of the State of Connecticut, but only in each case to the
limited extent the same may be applicable to State Street or
the Pass Through Trustee, and relevant to our opinions
expressed below) to execute, and to perform its obligations
under, the Operative Documents, and (iii) each party to the
Operative Documents (other than State Street or the Pass
Through Trustee, as applicable) has duly executed and delivered
each of such agreements and instruments to which it is a party
and that (other than with respect to State Street and the Pass
Through Trustee, as applicable) the execution and delivery of
such agreements and instruments and the transactions
contemplated thereby have been duly authorized by proper
corporate or other organizational proceedings as to such party.
II. We have assumed without any independent investigation (i)
that each of the Operative Documents is a valid, binding and
enforceable obligation of each party thereto other than State
Street or the Pass Through Trustee, as applicable, and (ii)
that each of the Operative Documents is a valid, binding and
enforceable obligation of State Street or the Pass Through
Trustee, as applicable, to the extent that laws other than
those of the State of Connecticut are relevant thereto (other
than the laws of the United States of America, but only to the
limited extent the same may be applicable to State Street or
the Pass Through Trustee, as applicable, and relevant to our
opinions expressed below).
III. The enforcement of any obligations of State Street
or the Pass Through Trustee, as applicable, under any of the
Operative Documents may be limited by the receivership,
conservatorship and supervisory powers of bank regulatory
agencies generally, as well as by bankruptcy, insolvency,
reorganization, moratorium, marshaling or other laws and rules
of law affecting the enforcement generally of creditors' rights
and remedies (including such as may deny giving effect to
waivers of debtors' or guarantors' rights); and we express no
opinion as to the status under any fraudulent conveyance laws
or fraudulent transfer laws of any of the obligations of State
Street or the Pass Through Trustee, as applicable, under any of
the Operative Documents.
IV. We express no opinion as the availability of any
specific or equitable relief of any kind.
V. The enforcement of any of your rights may in all cases be
subject to an implied duty of good faith and fair dealing and
to general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in
equity) and, as to any of your rights to collateral security,
will be subject to a duty to act in a commercially reasonable
manner.
VI. We express no opinion as to the enforceability of any
particular provision of any of the Operative Documents relating
to (i) waivers of rights to object to jurisdiction or venue, or
consents to jurisdiction or venue, (ii) waivers of rights to
(or methods of) service of process, or rights to trial by jury,
or other rights or benefits bestowed by operation of law, (iii)
waivers of any applicable defenses, setoffs, recoupments, or
counterclaims, (iv) the grant of powers of attorney to any
person or entity, (v) exculpation or exoneration clauses,
indemnity clauses, and clauses relating to releases or waivers
of unmatured claims or rights, (vi) the imposition or
collection of interest on overdue interest or providing for a
penalty rate of interest or late charges on overdue or
defaulted obligations, or the payment of any premium,
liquidated damages, or other amount which may be held by any
court to be a "penalty" or a "forfeiture," or (vii) so-called
"usury savings clauses" purporting to specify methods of (or
otherwise assure) compliance with usury laws or other similar
laws of any jurisdiction.
VII. We express no opinion as to the effect of events
occurring, circumstances arising, or changes of law becoming
effective or occurring, after the date hereof on the matters
addressed in this opinion letter, and we assume no
responsibility to inform you of additional or changed facts, or
changes in law, of which we may become aware.
VIII. No opinion is given herein as to the effect of
usury laws (or other similar laws) of any jurisdiction with
respect to the Operative Documents.
In rendering the opinion set forth below in paragraph 6 as to certain
Connecticut tax matters, we have assumed that, for federal income tax
purposes, the trust created by the Trust Agreement will not be taxable as a
corporation, but, rather, will be classified as a grantor trust under
subpart E, Part I of Subchapter J of Chapter 1 of Subtitle A of the
Internal Revenue Code of 1986, as amended or as a partnership.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their successors and assigns in connection
with the transactions contemplated by the Operative Documents and may not
be used or relied upon by any other person or for any other purpose.
1. State Street is a national banking association, validly formed and
authorized to operate as a national banking association under the laws of
the United States of America and, in its individual capacity or as Pass
Through Trustee, as the case may be, has or had, as the case may be, the
requisite corporate and trust power and authority to execute, deliver and
perform its obligations under the Operative Documents and in its capacity
as Pass Through Trustee, to issue and execute the Pass Through Certificates
delivered on the Pass Through Trust Closing Date.
2. State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, has duly authorized by all necessary corporate
or trust action the Operative Documents and has duly executed and delivered
the Operative Documents, and the Operative Documents constitute valid and
binding obligations of State Street, in its individual capacity or as Pass
Through Trustee, as the case may be, enforceable against State Street, in
its individual capacity or as Pass Through Trustee, as the case may be, in
accordance with their respective terms.
3. The Pass Through Certificates issued and dated on the Pass Through
Trust Closing Date have been duly issued, authenticated and delivered by
State Street as Pass Through Trustee pursuant to the terms of the Operative
Documents and are enforceable against the Pass Through Trustee and are
entitled to the benefits of the applicable Pass Through Trusts.
4. The authorization, execution, delivery and performance by State
Street, in its individual capacity or as Pass Through Trustee, as the case
may be, of the Operative Documents and the consummation of the transactions
therein contemplated and compliance with the terms thereof do not and will
not result in the violation of the provisions of the charter documents or
by-laws of State Street and, to the best of our knowledge, do not conflict
with, or result in a breach of any terms or provisions of, or constitute a
default under, or result in the creation or the imposition of any lien,
charge or encumbrance upon any property or assets of State Street under any
indenture, mortgage or other agreement or instrument, in each case known to
us, to which State Street is a party or by which it is bound, or violates
any applicable Connecticut or federal law, rule or regulation governing
State Street's banking or trust powers, or, to the best of our knowledge,
of any judgment, order or decree, in each case known to us, applicable to
State Street of any court, regulatory body, administrative agency,
government or governmental body having jurisdiction over State Street.
5. No authorization, approval, consent, license or order of, giving
of notice to, registration with, or taking of any other action in respect
of, any federal or state governmental authority or agency pursuant to any
federal or Connecticut law governing the banking or trust powers of State
Street is required for the authorization, execution, delivery and
performance by State Street, in its individual capacity or as Pass Through
Trustee, as the case may be, of the Operative Documents or the consummation
of any of the transactions by State Street, in its individual capacity or
as Pass Through Trustee, as the case may be, contemplated thereby (except
as shall have been duly obtained, given or taken); and such authorization,
execution, delivery, performance, consummation and issuance do not conflict
with or result in a breach of the provisions of any such law.
6. There are no taxes, fees or other governmental charges payable
under the laws of the State of Connecticut or any political subdivision of
such State in connection with the execution and delivery by State Street,
in its individual capacity or as Pass Through Trustee, as the case may be,
of the Operative Documents (except for taxes on any fees payable to State
Street in its individual capacity) or in connection with the issuance,
execution and delivery of the Pass Through Certificates by State Street, as
Pass Through Trustee, pursuant to the Pass Through Trusts which are imposed
solely because State Street has its principal place of business in
Connecticut or performs its administrative duties under the Operative
Documents in Connecticut. Neither State Street, in its individual capacity
or as the Pass Through Trustee, as the case may be, the Indenture Trustee,
the Owner Participant, the Owner Trustee, nor the trust created by the
Trust Agreement will, as a result of the transactions contemplated thereby,
be subject to any Taxes under the laws of the State of Connecticut or any
political subdivision thereof (except for Taxes on any fees payable to
State Street in its individual capacity) which are imposed because State
Street has its principal place of business in Connecticut or performs its
administrative duties under the Operative Documents in Connecticut, and
there are no Taxes under the laws of the State of Connecticut or any
political subdivision thereof (except for Taxes on any fees payable to
State Street in its individual capacity) upon or with respect to the
Aircraft or any Engine or any part of any interest therein, or the
purchase, ownership, delivery, lease, sublease, possession, presence, use,
operation, condition, storage, maintenance, modification, alteration,
repair, sale, return, transfer or other disposition of the Aircraft or any
Engine which are imposed because State Street has its principal place of
business in Connecticut or performs its administrative duties under the
Operative Documents in Connecticut.
7. To our knowledge, but without having investigated any governmental
records or court dockets, and without having made any other independent
investigation, there are no proceedings pending or overtly threatened in
writing against or affecting State Street in any court or before any
governmental authority, agency, arbitration board or tribunal which, if
adversely determined, individually or in the aggregate, could reasonably be
expected to affect materially and adversely the trust related to the
Indenture or affect the right, power and authority of State Street, in its
individual capacity or as Pass Through Trustee, as the case may be, to
enter into or perform its obligations under the Operative Documents.
Very truly yours,
BINGHAM DANA LLP
SCHEDULE A
----------
State Street Bank and Trust Company of
Connecticut, National Association
US Airways, Inc.
US Airways Group, Inc.
Standard & Poor's Ratings Service
Moody's Investors Service, Inc.
Credit Suisse First Boston Corporation
- -------------------------
- -------------------------
FORM OF OPINION OF BINGHAM DANA, SPECIAL COUNSEL TO THE
SUBORDINATION AGENT
- -------, --------
TO THE PARTIES SET FORTH
IN SCHEDULE A HERETO
RE: US Airways, Inc./Secured Financing of One Airbus [A320]
[A330-300] Aircraft [N _____ US] - Subordination Agent,
Owned Aircraft
Ladies and Gentlemen:
We have acted as special counsel for State Street Bank and Trust
Company of Connecticut, National Association, in its individual capacity
("STATE STREET") and as Subordination Agent (the "SUBORDINATION AGENT")
under the Intercreditor Agreement dated as of [________________] (the
"INTERCREDITOR AGREEMENT") among State Street Bank , in its capacity as
Pass Through Trustee under the US Airways Pass Through Trust 1999-1A, US
Airways Pass Through Trust 1999-1B and US Airways Pass Through Trust
1999-1C, [_______________], as Class A Liquidity Provider, Class B
Liquidity Provider and Class C Liquidity Provider and State Street, as
Subordination Agent in connection with the execution and delivery of the
Participation Agreement [N ____ US] dated as of [________________] (the
"PARTICIPATION AGREEMENT") by and among State Street, as Indenture Trustee,
US Airways, Inc., State Street, as Pass Through Trustee (the "PASS THROUGH
Trustee"), and State Street as Subordination Agent and the transactions
contemplated thereby. Capitalized terms not otherwise defined herein shall
have the meanings specified in Annex A of the Participation Agreement. This
opinion is being delivered pursuant to Section 4( )(____) of the
Participation Agreement.
Our representation of State Street and the Subordination Agent has
been as special counsel for the limited purposes stated above. As to all
matters of fact (including factual conclusions and characterizations and
descriptions of purpose, intention or other state of mind), we have relied,
with your permission, entirely upon (i) the representations and warranties
of the parties set forth in the Operative Documents and (ii) certificates
delivered to us by the management of State Street and have assumed, without
independent inquiry, the accuracy of those representations, warranties and
certificates.
We have examined the Participation Agreement, the Note Purchase
Agreement and the Intercreditor Agreement (the "OPERATIVE DOCUMENTS"), the
Certificate of the Comptroller of the Currency relating to State Street and
originals, or copies certified or otherwise identified to our satisfaction,
of such other records, documents, certificates, or other instruments as we
have deemed necessary or advisable for the purposes of this opinion. For
purposes of our opinion rendered in paragraph 1 below, with respect to the
authority of State Street to operate as a national banking association and
exercise trust powers, our opinion relies upon and is limited by such
Certificate of the Comptroller of the Currency.
We have assumed the genuineness of all signatures (other than those
on behalf of State Street and the Subordination Agent), the conformity to
the originals of all documents reviewed by us as copies, and the
authenticity and completeness of all original documents reviewed by us in
original or copy form and the legal competence of each individual executing
any document (other than on behalf of State Street and the Subordination
Agent).
When an opinion set forth below is given to the best of our
knowledge, or to our knowledge, or with reference to matters of which we
are aware or which are known to us, or with another similar qualification,
the relevant knowledge or awareness is limited to the actual knowledge or
awareness of the individual lawyer in the firm that signed this opinion,
the individual lawyers in the firm who have participated directly in the
specific transactions to which this opinion relates and the partner of the
firm responsible for State Street corporate trust matters, and without any
special or additional investigation undertaken for the purposes of this
opinion.
Subject to the limitation set forth below, we have made such
examination of law as we have deemed necessary for the purposes of this
opinion. The opinions set forth below are limited solely to the internal
substantive laws of the State of Connecticut as applied by courts located
in Connecticut and the federal laws of the United States. No opinion is
given herein as to the choice of law or internal substantive rules of law
that any court or other tribunal may apply to the transactions contemplated
by the Operative Documents. No opinion is expressed herein as to the
application or effect of federal securities laws or as to the securities or
so-called "Blue Sky" laws of any state or other jurisdiction. In addition,
no opinion is expressed as to matters governed by any law, statute, rule or
regulation of the United States relating to the acquisition, ownership,
registration, use, operation, maintenance, repair, replacement or sale of
or the nature of the Aircraft.
To the extent to which this opinion deals with matters governed by or
relating to the laws of the State of New York, or other jurisdiction other
than the State of Connecticut, by which the Operative Documents are stated
to be governed, we have assumed, with your permission that the Operative
Documents are governed by the internal substantive laws of the State of
Connecticut.
Our opinion is further subject to the following exceptions,
qualifications and assumptions:
I. We have assumed without any independent investigation
that (i) each party to the Operative Documents, other than
State Street, in its individual capacity or as Subordination
Agent, as applicable, at all times relevant thereto, is validly
existing and in good standing under the laws of the
jurisdiction in which it is organized, and is qualified to do
business and in good standing under the laws of each
jurisdiction where such qualification is required generally or
necessary in order for such party to enforce its rights under
such Operative Documents, and (ii) each party to the Operative
Documents, at all times relevant thereto, had and has the full
power, authority and legal right under its certificate of
incorporation, partnership agreement, by-laws, and other
governing organizational documents, and the applicable
corporate, partnership, or other enterprise legislation and
other applicable laws, as the case may be (other than State
Street and the Subordination Agent with respect to the laws of
the United States of America and the internal substantive laws
of the State of Connecticut, but only in each case to the
limited extent the same may be applicable to State Street or
the Subordination Agent, and relevant to our opinions expressed
below) to execute, and to perform its obligations under, the
Operative Documents, and (iii) each party to the Operative
Documents (other than State Street or the Subordination Agent,
as applicable) has duly executed and delivered each of such
agreements and instruments to which it is a party and that
(other than with respect to State Street and the Subordination
Agent, as applicable) the execution and delivery of such
agreements and instruments and the transactions contemplated
thereby have been duly authorized by proper corporate or other
organizational proceedings as to such party.
II. We have assumed without any independent investigation (i)
that each of the Operative Documents is a valid, binding and
enforceable obligation of each party thereto other than State
Street or the Subordination Agent, as applicable, and (ii) that
each of the Operative Documents is a valid, binding and
enforceable obligation of State Street or the Subordination
Agent, as applicable, to the extent that laws other than those
of the State of Connecticut are relevant thereto (other than
the laws of the United States of America, but only to the
limited extent the same may be applicable to State Street or
the Subordination Agent, as applicable, and relevant to our
opinions expressed below).
III. The enforcement of any obligations of State Street
or the Subordination Agent, as applicable, under any of the
Operative Documents may be limited by the receivership,
conservatorship and supervisory powers of bank regulatory
agencies generally, as well as by bankruptcy, insolvency,
reorganization, moratorium, marshaling or other laws and rules
of law affecting the enforcement generally of creditors' rights
and remedies (including such as may deny giving effect to
waivers of debtors' or guarantors' rights); and we express no
opinion as to the status under any fraudulent conveyance laws
or fraudulent transfer laws of any of the obligations of State
Street or the Subordination Agent, as applicable, under any of
the Operative Documents.
IV. We express no opinion as the availability of any
specific or equitable relief of any kind.
V. The enforcement of any of your rights may in all cases be
subject to an implied duty of good faith and fair dealing and
to general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in
equity) and, as to any of your rights to collateral security,
will be subject to a duty to act in a commercially reasonable
manner.
VI. We express no opinion as to the enforceability of any
particular provision of any of the Operative Documents relating
to (i) waivers of rights to object to jurisdiction or venue, or
consents to jurisdiction or venue, (ii) waivers of rights to
(or methods of) service of process, or rights to trial by jury,
or other rights or benefits bestowed by operation of law, (iii)
waivers of any applicable defenses, setoffs, recoupments, or
counterclaims, (iv) the grant of powers of attorney to any
person or entity, (v) exculpation or exoneration clauses,
indemnity clauses, and clauses relating to releases or waivers
of unmatured claims or rights, (vi) the imposition or
collection of interest on overdue interest or providing for a
penalty rate of interest or late charges on overdue or
defaulted obligations, or the payment of any premium,
liquidated damages, or other amount which may be held by any
court to be a "penalty" or a "forfeiture," or (vii) so-called
"usury savings clauses" purporting to specify methods of (or
otherwise assure) compliance with usury laws or other similar
laws of any jurisdiction.
VII. We express no opinion as to the effect of events
occurring, circumstances arising, or changes of law becoming
effective or occurring, after the date hereof on the matters
addressed in this opinion letter, and we assume no
responsibility to inform you of additional or changed facts, or
changes in law, of which we may become aware.
VIII. No opinion is given herein as to the effect of
usury laws (or other similar laws) of any jurisdiction with
respect to the Operative Documents.
This opinion is rendered solely for the benefit of those institutions
listed on Schedule A hereto and their successors and assigns in connection
with the transactions contemplated by the Operative Documents and may not
be used or relied upon by any other person or for any other purpose.
1. State Street is a national banking association, validly formed and
authorized to operate as a national banking association under the laws of
the United States of America and, in its individual capacity or as
Subordination Agent, as the case may be, has the requisite corporate and
trust power and authority to execute, deliver and perform its obligations
under the Operative Documents.
2. State Street, in its individual capacity or as Subordination
Agent, as the case may be, has duly authorized the Operative Documents by
all necessary corporate or trust action and has duly executed and delivered
the Operative Documents, and the Operative Documents constitute valid and
binding obligations of State Street, in its individual capacity or as
Subordination Agent, as the case may be, enforceable against State Street,
in its individual capacity or as Subordination Agent, as the case may be,
in accordance with their respective terms.
3. The authorization, execution, delivery and performance by State
Street, in its individual capacity or as Subordination Agent, as the case
may be, of the Operative Documents and the consummation of the transactions
therein contemplated and compliance with the terms thereof do not and will
not result in the violation of the provisions of the charter documents or
by-laws of State Street and, to the best of our knowledge, do not conflict
with, or result in a breach of any terms or provisions of, or constitute a
default under, or result in the creation or the imposition of any lien,
charge or encumbrance upon any property or assets of State Street under any
indenture, mortgage or other agreement or instrument, in each case known to
us, to which State Street is a party or by which it is bound, or violates
any applicable Connecticut or federal law, rule or regulation governing
State Street's banking or trust powers, or, to the best of our knowledge,
of any judgment, order or decree, in each case known to us, applicable to
State Street of any court, regulatory body, administrative agency,
government or governmental body having jurisdiction over State Street.
4. No authorization, approval, consent, license or order of, giving
of notice to, registration with, or taking of any other action in respect
of, any federal or state governmental authority or agency pursuant to any
federal or Connecticut law governing the banking or trust powers of State
Street is required for the authorization, execution, delivery and
performance by State Street, in its individual capacity or as Subordination
Agent, as the case may be, of the Operative Documents or the consummation
of any of the transactions by State Street, in its individual capacity or
as Subordination Agent, as the case may be, contemplated thereby (except as
shall have been duly obtained, given or taken); and such authorization,
execution, delivery, performance, consummation and issuance do not conflict
with or result in a breach of the provisions of any such law.
5. There are no taxes, fees or other governmental charges payable
under the laws of the State of Connecticut or any political subdivision of
such State in connection with the execution and delivery by State Street,
in its individual capacity or as Subordination Agent, as the case may be,
of the Operative Documents (except for taxes on any fees payable to State
Street in its individual capacity) which are imposed solely because State
Street has its principal place of business in Connecticut or performs its
administrative duties under the Operative Documents in Connecticut.
6. To our knowledge, but without having investigated any governmental
records or court dockets, and without having made any other independent
investigation, there are no proceedings pending or overtly threatened in
writing against or affecting State Street in any court or before any
governmental authority, agency, arbitration board or tribunal which, if
adversely determined, individually or in the aggregate, could reasonably be
expected to affect materially and adversely the trust related to the
Indenture or affect the right, power and authority of State Street, in its
individual capacity or as Subordination Agent, as the case may be, to enter
into or perform its obligations under the Operative Documents.
7. Assuming that the Subordination Agent holds each of the Equipment
Notes delivered to and registered in its name pursuant to and as required
by the Intercreditor Agreement, it holds such Equipment Notes in trust as
trustee for the related Pass Through Trustee in the exercise of the
fiduciary powers conferred upon State Street by Connecticut law.
Very truly yours,
BINGHAM DANA LLP
SCHEDULE A
----------
State Street Bank and Trust Company of Connecticut, National Association
US Airways, Inc.
US Airways Group, Inc.
Standard & Poor's Ratings Service
Moody's Investors Service, Inc.
Credit Suisse First Boston Corporation
Exhibit 4(a)(xxi)
Owned Aircraft Indenture
N___U_
INDENTURE AND SECURITY AGREEMENT
(N___U_)
Dated as of __________ __, ____
Between
US AIRWAYS, INC.
Owner
and
STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION,
Indenture Trustee
EQUIPMENT NOTES COVERING
ONE AIRBUS A3__-___ AIRCRAFT
BEARING U.S. REGISTRATION MARK N___U_
OWNED BY US AIRWAYS, INC.
Page
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS.............................................................5
SECTION 1.01. Definitions...................................5
ARTICLE II
THE EQUIPMENT NOTES.....................................................6
SECTION 2.01. Form of Equipment Notes.......................6
SECTION 2.02. Issuance and Terms of Equipment Notes........10
SECTION 2.03. [Reserved]...................................13
SECTION 2.04. Method of Payment............................13
SECTION 2.05. Application of Payments......................16
SECTION 2.06. Termination of Interest in Indenture Estate..16
SECTION 2.07. Registration, Transfer and Exchange of
Equipment Notes..............................16
SECTION 2.08. Mutilated, Destroyed, Lost or Stolen
Equipment Notes..............................18
SECTION 2.09. Payment of Expenses on Transfer;
Cancellation.................................19
SECTION 2.10. Mandatory Redemptions of Equipment Notes.....19
SECTION 2.11. Voluntary Redemptions of Equipment Notes.....19
SECTION 2.12. Redemptions; Notice of Redemption............19
SECTION 2.13. [Reserved]...................................20
SECTION 2.14. [Reserved]...................................21
SECTION 2.15. Subordination................................21
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF INCOME FROM THE
INDENTURE ESTATE.......................................................21
SECTION 3.01. Basic Distributions..........................21
SECTION 3.02. Event of Loss; Optional Redemption...........22
SECTION 3.03. Payments After Event of Default..............23
SECTION 3.04. Certain Payments.............................25
SECTION 3.05. Other Payments...............................26
SECTION 3.06. Payments to Owner............................26
ARTICLE IV
CERTAIN COVENANTS OF OWNER; EVENTS OF DEFAULT; REMEDIES OF
INDENTURE TRUSTEE......................................................26
SECTION 4.01. Certain Covenants of Owner...................26
SECTION 4.02. Event of Default.............................27
SECTION 4.03. [Reserved]...................................28
SECTION 4.04. Remedies.....................................28
SECTION 4.05. Return of Aircraft, Etc......................30
SECTION 4.06. Remedies Cumulative..........................32
SECTION 4.07. Discontinuance of Proceedings................32
SECTION 4.08. Waiver of Past Defaults......................32
SECTION 4.09. Appointment of Receiver......................33
SECTION 4.10. Indenture Trustee Authorized to Execute
Bills of Sale, Etc...........................33
SECTION 4.11. Rights of Note Holders to Receive Payment....33
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE........................................34
SECTION 5.01. Notice of Event of Default...................34
SECTION 5.02. Action upon Instructions;
Certain Rights and Limitations...............34
SECTION 5.03. Indemnification..............................35
SECTION 5.04. No Duties Except as Specified in Indenture
or Instructions..............................35
SECTION 5.05. No Action Except Under Indenture or
Instructions.................................36
SECTION 5.06. Replacement Airframes and Replacement
Engines......................................36
SECTION 5.07. Indenture Supplements for Replacements.......38
SECTION 5.08. Effect of Replacement........................39
SECTION 5.09. Investment of Amounts Held by Indenture
Trustee......................................39
ARTICLE VI
THE INDENTURE TRUSTEE..................................................40
SECTION 6.01. Acceptance of Trusts and Duties...............40
SECTION 6.02. Absence of Duties.............................40
SECTION 6.03. No Representations or Warranties as to
Aircraft or
Documents.....................................40
SECTION 6.04. No Segregation of Monies; No Interest.........41
SECTION 6.05. Reliance; Agreements; Advice of Counsel.......41
SECTION 6.06. [Reserved]....................................42
SECTION 6.07. Compensation..................................42
SECTION 6.08. Instructions from Note Holders................42
ARTICLE VII
OPERATING COVENANTS OF THE OWNER.......................................43
SECTION 7.01. Liens........................................43
SECTION 7.02. Registration, Maintenance and Operation;
Possession and Leases; Insignia..............43
SECTION 7.03. Replacement and Pooling of Parts;
Alterations, Modifications and Additions.....49
SECTION 7.04. Insurance....................................52
SECTION 7.05. Inspection...................................52
SECTION 7.06. Filings; Delivery of Financial Statements....53
ARTICLE VIII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER..........................54
SECTION 8.01. Scope of Indemnification.....................54
ARTICLE IX
SUCCESSOR AND SEPARATE TRUSTEES........................................55
SECTION 9.01. [Reserved.]..................................55
SECTION 9.02. Resignation of Indenture Trustee;
Appointment of Successor.....................55
SECTION 9.03. Appointment of Additional and Separate
Trustees.....................................56
ARTICLE X
SUPPLEMENTS AND AMENDMENTS TO THIS INDENTURE
AND OTHER DOCUMENTS ...................................................59
SECTION 10.01. Instructions of Majority; Limitations........59
SECTION 10.02. Trustees Protected. .........................61
SECTION 10.03. Documents Mailed to Note Holders. ...........61
SECTION 10.04. No Request Necessary for Indenture
Supplement...................................61
ARTICLE XI
MISCELLANEOUS..........................................................61
SECTION 11.01. Termination of Indenture. ...................61
SECTION 11.02. No Legal Title to Indenture Estate in Note
Holders. ....................................62
SECTION 11.03. Sale of Aircraft by Indenture Trustee Is
Binding......................................62
SECTION 11.04. Indenture for Benefit of Owner, Indenture ...62
SECTION 11.05. Notices. ....................................63
SECTION 11.06. Severability. ...............................63
SECTION 11.07. No Oral Modification or Continuing Waivers. .63
SECTION 11.08. Successors and Assigns. .....................64
SECTION 11.09. Headings. ...................................64
SECTION 11.10. Normal Commercial Relations. ................64
SECTION 11.11. Governing Law; Counterpart Form. ............64
SECTION 11.12. Voting By Note Holders. .....................65
SECTION 11.13. Bankruptcy. .................................65
SECTION 11.14. References. .................................65
EXHIBIT B INDENTURE AND SECURITY AGREEMENT................Exhibit B-1
EXHIBIT C INDENTURE AND SECURITY AGREEMENT................Exhibit C-1
SCHEDULE I. .....................................................Schedule I-1
SCHEDULE II PASS THROUGH TRUST AGREEMENT AND PASS
THROUGH TRUST SUPPLEMENTS.......................Schedule II-1
Owned Aircraft Indenture
N___U_
INDENTURE AND SECURITY AGREEMENT
(N___U_)
INDENTURE AND SECURITY AGREEMENT (N___U_), dated as of
_________ __, ____ (as amended, modified or supplemented from time to time,
this "Indenture") between US AIRWAYS, INC., a Delaware corporation
(together with its successors and permitted assigns, "Owner"), and STATE
STREET BANK AND TRUST COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, a
national banking association, as Indenture Trustee hereunder (together with
its successors hereunder, the "Indenture Trustee").
W I T N E S S E T H
WHEREAS, the parties desire by this Indenture, among other
things, (i) to provide for the issuance by Owner to the Pass Through
Trustees (or their designee) of the Equipment Notes evidencing the
participation of the Pass Through Trustees in the financing of Owner's Cost
for the Aircraft, as provided in the Participation Agreement and (ii) to
provide for the assignment, mortgage and pledge by Owner to the Indenture
Trustee, as part of the Indenture Estate hereunder, among other things, of
all of Owner's right, title and interest in and to the Aircraft, as
security for, among other things, Owner's obligations to the Indenture
Trustee, for the ratable benefit and security of the Note Holders, subject
to Section 2.15 and Article III;
WHEREAS, all things have been done to make the Equipment
Notes, when executed by Owner and authenticated and delivered by the
Indenture Trustee hereunder, the valid, binding and enforceable obligations
of Owner; and
WHEREAS, all things necessary to make this Indenture the
valid, binding and legal obligation of Owner 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 INDENTURE AND SECURITY AGREEMENT
WITNESSETH, that, to secure (i) 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
(ii) the performance and observance by Owner of all the agreements,
covenants and provisions herein and in the Participation Agreement and the
Equipment Notes contained, for the benefit of the Note Holders, the Loan
Participants and each of the Indenture Indemnitees and the prompt payment
of all amounts from time to time owing hereunder and under the
Participation Agreement to the Note Holders, the Loan Participants or any
Indenture Indemnitee by Owner (the "Secured Obligations") and for the uses
and purposes and subject to the terms and provisions hereof, and in
consideration of the premises and of the covenants herein contained, and of
the acceptance of the Equipment Notes by the holders thereof, and for other
good and valuable consideration the receipt and adequacy whereof are hereby
acknowledged, Owner has granted, assigned, transferred, conveyed,
mortgaged, pledged and confirmed, and does hereby grant, assign, transfer,
convey, mortgage, pledge and confirm, unto the Indenture Trustee, its
successors in trust and assigns, for the security and benefit of the Note
Holders, a first priority security interest in and mortgage lien on all
right, title and interest of Owner in, to and under the following described
property, rights and privileges, to wit:
(1) the Aircraft (including the Airframe and the Engines
and all replacements thereof and substitutions therefor to which Owner
shall from time to time acquire title as provided herein), 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;
(2) the Purchase Agreement (to the extent specified in the
Purchase Agreement Assignment), the Purchase Agreement Assignment, the
Consent and Agreement and the Bill of Sale;
(3) all rents, issues, profits, revenues and other income
of the property subjected or required to be subjected to the Lien of this
Indenture;
(4) all insurance and requisition proceeds with respect to
the Aircraft, including but not limited to the insurance required under
Section 7.04;
(5) all monies and securities from time to time deposited
or required to be deposited with the Indenture Trustee pursuant to any
terms of this Indenture or required hereby to be held by the Indenture
Trustee hereunder; and
(6) all proceeds of the foregoing.
Concurrently with the delivery hereof, Owner is delivering
to the Indenture Trustee executed copies of the Participation Agreement,
the French Pledge Agreement and the Purchase Agreement Assignment with the
Consent and Agreement attached thereto.
TO HAVE AND TO HOLD all and singular the aforesaid
property unto the Indenture Trustee, and its successors and assigns, in
trust for the benefit and security of the Note Holders and the Indenture
Indemnitees, except as provided in Section 2.15 and Article III without any
preference, distinction or priority of any one Equipment Note over any
other by reason of priority of time of issue, sale, negotiation, date of
maturity thereof or otherwise for any reason whatsoever, and for the uses
and purposes and in all cases and as to all property specified in
paragraphs (1) through (6) inclusive above, subject to the terms and
provisions set forth in this Indenture.
It is expressly agreed that anything herein contained to
the contrary notwithstanding, Owner shall remain liable under each of the
Indenture Agreements to which it is a party to perform all of the
obligations assumed by it thereunder, except to the extent prohibited or
excluded from doing so pursuant to the terms and provisions thereof, and
the Indenture Indemnitees, Indenture Trustee and the Note Holders shall
have no obligation or liability under the Indenture Agreements, by reason
of or arising out of the assignment hereunder, nor shall the Indenture
Indemnitees, Indenture Trustee or the Note Holders be required or obligated
in any manner to perform or fulfill any obligations of Owner under or
pursuant to any of the Indenture Agreements to which it is a party, 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.
Notwithstanding the above, the Indenture Trustee agrees,
for the benefit of AVSA, S.A.R.L., that in exercising or assigning its
rights under the Purchase Agreement Assignment, the terms and conditions of
the Purchase Agreement Assignment shall apply, and be binding upon, the
Indenture Trustee.
Owner does hereby constitute the Indenture Trustee the
true and lawful attorney of Owner, irrevocably, granted for good and
valuable consideration and coupled with an interest and with full power of
substitution, and with full power (in the name of Owner or otherwise) to
ask for, require, demand, receive, compound and give acquittance for any
and all monies and claims for monies (in each case including insurance and
requisition proceeds) due and to become due under or arising out of the
Indenture Agreements, and all other property which now or hereafter
constitutes part of the 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. Without limiting the
generality of the foregoing, but subject to the rights of Owner hereunder,
during the continuance of any Event of Default under this Indenture, the
Indenture Trustee shall have the right under such power of attorney to
accept any offer in connection with the exercise of remedies as set forth
herein of any purchaser to purchase the Airframe and Engines and upon such
purchase to execute and deliver in the name of and on behalf of Owner an
appropriate bill of sale and other instruments of transfer relating to the
Airframe and Engines, when purchased by such purchaser, and to perform all
other necessary or appropriate acts with respect to any such purchase, and
in its discretion to file any claim or take any other action or
proceedings, either in its own name or in the name of Owner or otherwise,
which the Indenture Trustee may deem necessary or appropriate to protect
and preserve the right, title and interest of the Indenture Trustee in and
to such rents and other sums and the security intended to be afforded
hereby; provided, however, that no action of the Indenture Trustee pursuant
to this paragraph shall increase the obligations or liabilities of Owner to
any Person beyond those obligations and liabilities specifically set forth
in this Indenture and in the other Operative Documents. Owner agrees that
promptly upon receipt thereof, it will transfer to the Indenture Trustee
any and all monies from time to time received by it constituting part of
the Indenture Estate, for distribution by the Indenture Trustee pursuant to
this Indenture.
Owner agrees that at any time and from time to time, upon
the written request of the Indenture Trustee, Owner 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 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 benefits of
the assignment hereunder and of the rights and powers herein granted.
Owner does hereby warrant and represent that it has not
assigned or pledged, and hereby covenants and agrees that, except as
permitted by the terms hereof, it will not assign or pledge, so long as the
assignment hereunder shall remain in effect, and the Lien hereof shall not
have been released pursuant to Section 11.01, any of its right, title or
interest hereby assigned, to anyone other than the Indenture Trustee, and
that it will not, except as otherwise provided in this Indenture, (i) enter
into any agreement amending or supplementing any Indenture Agreement, (ii)
execute any waiver or modification of, or consent under, the terms of, or
exercise any rights, powers or privileges under, any Indenture Agreement,
(iii) settle or compromise any claim arising under any Indenture Agreement
or (iv) submit or consent to the submission of any dispute, difference or
other matter arising under or in respect of any Indenture Agreement to
arbitration thereunder.
Owner does hereby further agree that, except as permitted
by the terms hereof, it will not without the written consent of the
Indenture Trustee sell, mortgage, transfer, assign or hypothecate (other
than to the Indenture Trustee hereunder) its interest in the Airframe and
Engines or any part thereof or in any amount to be received by it from the
use or disposition of the Airframe and Engines, other than amounts
distributed to it pursuant to Article III.
It is hereby further agreed that any and all property
described or referred to in the granting clauses hereof which is hereafter
acquired by Owner shall ipso facto, and without any further conveyance,
assignment or act on the part of Owner or the Indenture Trustee, become and
be subject to the Lien herein granted as fully and completely as though
specifically described herein, but nothing contained in this paragraph
shall be deemed to modify or change the obligations of Owner contained in
the foregoing paragraphs.
Owner does hereby agree that it will not violate any
covenant or agreement made by it, herein or in any of the other Owner
Documents.
IT IS HEREBY COVENANTED AND AGREED by and between the
parties hereto as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01.Definitions. For all purposes of this
Indenture, capitalized terms used but not defined herein shall have the
respective meanings set forth or incorporated by reference, and shall be
construed and interpreted in the manner described, in Annex A.
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.
US AIRWAYS, INC. SERIES [___] EQUIPMENT NOTE DUE [___]
ISSUED IN CONNECTION WITH THE AIRBUS A- AIRCRAFT
BEARING UNITED STATES REGISTRATION NUMBER _____.
No.____ Date: [______,__] $________________
INTEREST RATE MATURITY DATE
[____] [___________,_____]
US AIRWAYS, INC., hereby promises to pay to ___________, or
the registered assignee thereof, the principal sum of $_________ (the
"Principal Amount"), together with interest on the amount of 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 Interest Rate indicated
above. The Principal Amount of this Equipment Note shall be payable on the
dates and in the installments as set forth in Schedule I hereto. Accrued
but unpaid interest shall be due and payable in semi-annual installments
commencing _______ 20, ____, and thereafter on January 20 and July 20 of
each year, to and including _______, _____. Notwithstanding the foregoing,
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. Notwithstanding anything to the contrary contained herein, 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 with the same
force and effect as if made on such scheduled date and if such payment is
made on such next succeeding Business Day, no interest shall accrue on the
amount of such payment from and after such scheduled date.
For purposes hereof, the term "Indenture" means the
Indenture and Security Agreement (N___U_), dated as of ___________ __,
____, between Owner and State Street Bank and Trust Company of Connecticut,
National Association (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).
There shall be maintained an Equipment Note 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.
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 of an
installment of the Principal Amount, Make-Whole Amount, if any, and
interest 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, or, to the
extent permitted by Law, any overdue interest and other amounts hereunder)
to the date of such payment, second, to the payment of the Principal Amount
of this Equipment Note (or portion hereof) then due (other than by reason
of redemption), 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 Principal Amount hereof
remaining unpaid and due by reason of redemption. The amounts paid pursuant
to clause fourth of the preceding sentence shall be applied to installments
of the Principal Amount of this Equipment Note remaining unpaid in the
inverse order of their normal maturity.
This Equipment Note is one of the Equipment Notes referred
to in the Indenture which have been or are to be issued by Owner pursuant
to the terms of the Indenture. The 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 Participation 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
Trust created by the Indenture, to all of which terms and conditions in the
Indenture and the Participation 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 Principal Amount of Equipment Notes of different authorized
denominations, as requested by the holder surrendering the same.
Prior to the due presentment for registration of transfer of
this Equipment Note, Owner and the Indenture Trustee shall deem and treat
the Person in whose name this Equipment Note is registered on the Equipment
Note Register as the absolute owner and holder hereof for the purpose of
receiving all amounts payable with respect to this Equipment Note and for
all purposes, and neither of Owner 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, 2.11 and 2.12 of the Indenture but not otherwise.
[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 A and Series B Equipment Notes](2), and this Equipment Note
is 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 its 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 its attorney-in-fact for such purpose.](3)
- -----------
1 To be inserted in the case of a Series B Equipment Note.
2 To be inserted in the case of a Series C Equipment Note.
3 To be inserted for each Equipment Note other than any Series A
Equipment Note.
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 BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
* * *
IN WITNESS WHEREOF, Owner has caused this Equipment Note to
be executed in its corporate name by its officer thereunto duly authorized
on the date hereof.
US AIRWAYS, INC.
By: ____________________________
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OFAUTHENTICATION
This is one of the Equipment Notes referred to in the
within-mentioned Indenture.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, not in
its individual capacity but solely as
Indenture Trustee
By: ____________________________
Name:
Title:
SCHEDULE I
EQUIPMENT NOTES AMORTIZATION
Payment Date Principal Amount to be Paid
- ------------ ---------------------------
* * *
SECTION 2.02. Issuance and Terms of Equipment Notes.
The Equipment Notes shall be dated the date of issuance
thereof, shall be issued in three separate series consisting of Series A,
Series B and Series C and in the maturities and principal amounts and shall
bear interest as specified in Schedule I hereto. On the date hereof, each
Equipment Note shall be issued to the Pass Through Trustees (or their
designee) under the Pass Through Agreements as set forth in Schedule II
hereto in connection therewith. 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 _________ 20, ____, and on each January
20 and July 20 thereafter until maturity. The Principal Amount of each
Equipment Note shall be payable on the dates and in the installments 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 Principal Amount and all
accrued and unpaid interest on, and any other amounts due under, such
Equipment Note. Each Equipment 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 with the same force and effect as if made on such scheduled
date and if such payment is made on such next succeeding Business Day, no
interest shall accrue on the amount of such payment from and after such
scheduled date.
Owner agrees to pay to the Indenture Trustee for
distribution in accordance with Section 3.04 (i) to the extent not payable
(whether or not in fact paid) under Section 7(a) of the Note Purchase
Agreement (as originally in effect or as amended with the consent of the
Owner) an amount or amounts equal to the fees payable to the Liquidity
Provider under Section 2.03 of each Liquidity Facility and the related Fee
Letter (as defined in the Intercreditor Agreement) multiplied by a fraction
the numerator of which shall be the then outstanding aggregate principal
amount of the Series A Equipment Notes, Series B Equipment Notes and Series
C Equipment Notes and the denominator of which shall be the then
outstanding aggregate principal amount of all "Series A Equipment Notes",
"Series B Equipment Notes" and "Series C Equipment Notes" (in each case as
defined in the relevant Operative Indenture) issued under the Operative
Indentures; (ii) (x) the amount equal to interest on any Downgrade Advance
(other than any Applied Downgrade Advance) payable under Section 3.07 of
each Liquidity Facility minus Investment Earnings from such Downgrade
Advance multiplied by (y) the fraction specified in the foregoing clause
(i); (iii) (x) the amount equal to interest on any Non-Extension Advance
(other than any Applied Non-Extension Advance) payable under Section 3.07
of each Liquidity Facility minus Investment Earnings from such
Non-Extension Advance multiplied by (y) the fraction specified in the
foregoing clause (i); (iv) if any payment default shall have occurred and
be continuing with respect to interest on any Series A Equipment Note,
Series B Equipment Note or Series C Equipment Note, (x) the excess, if any,
of (1) the amount equal to interest on any Unpaid Advance, Applied
Downgrade Advance or Applied Non-Extension Advance payable under Section
3.07 of each Liquidity Facility over (2) the sum of Investment Earnings
from any Final Advance plus any amount of interest at the Past Due Rate
actually payable (whether or not in fact paid) by Owner in respect of the
overdue scheduled interest on the Equipment Notes in respect of which such
Unpaid Advance, Applied Downgrade Advance or Applied Non-Extension Advance
was made multiplied by (y) a fraction the numerator of which shall be the
then aggregate overdue amounts of interest on the Series A Equipment Notes,
Series B Equipment Notes and Series C Equipment Notes (other than interest
becoming due and payable solely as a result of acceleration of any such
Equipment Notes) and the denominator of which shall be the then aggregate
overdue amounts of interest on all "Series A Equipment Notes", "Series B
Equipment Notes" and "Series C Equipment Notes" (in each case as defined in
the relevant Operative Indenture) issued under the Operative Indentures
(other than interest becoming due and payable solely as a result of
acceleration of any such "Equipment Notes"), (v) any other amounts owed to
the Liquidity Provider by the Subordination Agent as borrower under each
Liquidity Facility (other than amounts due as repayment of advances
thereunder or as interest on such advances), except to the extent payable
pursuant to clause (i), (ii), (iii) or (iv) above multiplied by the
fraction specified in the foregoing clause (i), (vi) all compensation and
reimbursement of expenses, disbursements and advances payable by Owner
under the Pass Through Trust Agreements multiplied by the fraction
specified in the foregoing clause (i), and (vii) all compensation and
reimbursement of expenses and disbursements payable to the Subordination
Agent under the Intercreditor Agreement except with respect to any income
or franchise taxes incurred by the Subordination Agent in connection with
the transactions contemplated by the Intercreditor Agreement multiplied by
the fraction specified in the foregoing clause (i). For purposes of this
paragraph, the terms "Applied Downgrade Advance", "Applied Non-Extension
Advance", "Cash Collateral Account", "Downgrade Advance", "Final Advance",
"Investment Earnings", "Non-Extension Advance" and "Unpaid Advance" shall
have the meanings specified in each Liquidity Facility or the Intercreditor
Agreement.
The Equipment Notes shall be executed on behalf of Owner 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
Owner shall bind Owner, notwithstanding that such 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. Owner 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 Owner signed by a Vice President or
Assistant Vice President or other authorized officer of Owner; 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 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. [Reserved].
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 11:00 a.m., 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. Owner 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
Owner), all amounts paid by Owner 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, agrees to
compensate such holders for loss of use of funds at the Federal Funds Rate
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 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 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 in view of the time of day
when the funds to be so transferred were received by it if such funds were
received after 11:00 a.m., New York City time, at the place of payment.
Prior to the due presentment for registration of transfer of any Equipment
Note, Owner and the Indenture Trustee shall deem and treat the Person in
whose name any Equipment Note is registered on the Equipment Note 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 Owner nor the Indenture
Trustee shall be affected by any notice to the contrary. So long as any
signatory to the Participation 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 I thereto and otherwise in the
manner provided in or pursuant to the Participation 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 Owner, 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 Owner) appropriate receipts showing the payment
thereof, together with such additional documentary evidence as any such
Note Holder 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 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 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. Owner shall not be liable if the Indenture Trustee fails
to withhold withholding taxes in accordance with this Section 2.04 or if
any Note Holder provides false or inaccurate information on any form
required to be delivered under this Section 2.04.
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 (other than by
reason of redemption);
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 and
due by reason of redemption (provided that such Equipment Note shall not be
subject to redemption except as provided in Sections 2.10, 2.11 and 2.12).
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 Indenture Estate.
A Note Holder and Indenture Indemnitees shall not, as such,
have any further interest in, or other right with respect to, the Indenture
Estate when and if the Secured Obligations due to such Note Holder or
Indenture Indemnitee shall have been paid in full.
SECTION 2.07. Registration, Transfer and Exchange of
Equipment Notes.
The Indenture Trustee shall keep a register (the "Equipment
Note Register") in which the Indenture Trustee shall provide for 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 Equipment Note Register
shall be kept at the Corporate Trust Office of the Indenture Trustee. The
Indenture Trustee is hereby appointed "Equipment Note 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, Owner 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 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 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,
Owner 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 or otherwise under this Indenture) shall be the valid
obligations of Owner 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,
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 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. Owner shall not be required to
exchange any surrendered Equipment Notes as provided above during the
ten-day period preceding the due date of any payment on such Equipment
Note. Owner shall in all cases deem the Person in whose name any Equipment
Note shall have been issued and registered as the absolute owner and holder
of such Equipment Note for the purpose of receiving payment of all amounts
payable by Owner with respect to such Equipment Note and for all purposes
until a notice stating otherwise is received from the Indenture Trustee and
such change is reflected on the Equipment Note Register. The Indenture
Trustee will promptly notify Owner 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 Participation
Agreement applicable to Note Holders, and shall be deemed to have
represented and warranted (except as provided above), and covenanted, to
the parties to the Participation Agreement as to the matters represented,
warranted and covenanted by the Loan Participants in the Participation
Agreement. 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 shall use all reasonable efforts to issue new
Equipment Notes upon transfer or exchange within ten (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, Owner 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 issued in connection
with the Aircraft. If the Equipment Note being replaced has become
mutilated, such Equipment Note shall be surrendered to the Indenture
Trustee and a photocopy thereof shall be furnished to Owner. If the
Equipment Note being replaced has been destroyed, lost or stolen, the
holder of such Equipment Note shall furnish to Owner and the Indenture
Trustee such security or indemnity as may be required by them to save Owner
and the Indenture Trustee harmless and evidence satisfactory to Owner and
the Indenture Trustee of the destruction, loss or theft of such Equipment
Note and of the ownership thereof. If a "qualified institutional buyer" of
the type referred to in paragraph (a)(l)(i)(A), (B), (D) or (E) of Rule
144A under the Securities Act (a "QIB") is the holder of any such
destroyed, lost or stolen Equipment Note, then the written indemnity of
such QIB, signed by an authorized officer thereof, in favor of, delivered
to and in form reasonably satisfactory to Owner 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 Note. Subject to compliance by the Note
Holder of the requirements set forth in this Section 2.08, the Indenture
Trustee and Owner shall use all reasonable efforts to issue new Equipment
Notes within ten (10) Business Days of the date of the written request
therefor from the Note Holder.
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 Equipment Note 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.
(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.
On the date on which Owner is required pursuant to Section
5.06 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 the date of redemption and all other amounts
payable hereunder or under the Participation Agreement to the Note Holders
but without the Make-Whole Amount.
SECTION 2.11. Voluntary Redemptions of Equipment Notes.
All, but not less than all, of the Equipment Notes may be
redeemed by Owner upon at least twenty (20) days' revocable prior written
notice to the Indenture Trustee at a redemption price equal to 100% of the
unpaid Principal Amount thereof, together with accrued interest thereon to
the date of redemption and all other amounts payable hereunder or under the
Participation Agreement to the Note Holders plus the Make-Whole Amount, if
any.
SECTION 2.12. Redemptions; Notice of Redemption.
(a) Neither any redemption of any Equipment Note nor any
purchase by Owner 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 fifteen (15) nor more than
sixty (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 Equipment Note Register. All notices of
redemption 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, if any such Equipment Notes are then outstanding, 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, Owner (or any person
on behalf of Owner) 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 Indenture Estate, deposit or cause to be
deposited with the Indenture Trustee by 11:00 a.m. 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 (and not revoked at least three (3) days prior to the redemption
date), 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 or at any office or agency maintained for such
purposes pursuant to Section 2.07, 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 2.13. [Reserved].
SECTION 2.14. [Reserved].
SECTION 2.15. Subordination.
(a) Owner 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(e), except as expressly provided in
Article III.
(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 2.15
or Article III, it will hold any amount so received in trust for the Senior
Holder (as defined in Section 2.15(c)) and will forthwith turn over such
payment to the Indenture Trustee in the form received to be applied as
provided in Article III.
(c) As used in this Section 2.15, the term "Senior Holder"
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 and (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.
ARTICLE III
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE INDENTURE ESTATE
SECTION 3.01. Basic Distributions.
Except as otherwise provided in Sections 3.02 and 3.03, each
periodic payment of principal or interest on the Equipment Notes received
by the Indenture Trustee shall be promptly distributed in the following
order of priority: (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
any overdue Principal Amount and, to the extent permitted by applicable
law, on any overdue interest and any other overdue amounts) then due 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 paragraph (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 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; and (iii) after giving effect to paragraph
(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 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.
SECTION 3.02. Event of Loss; Optional Redemption.
Except as otherwise provided in Section 3.03, any payments
received by the Indenture Trustee (i) with respect to the Aircraft as the
result of an Event of Loss or (ii) in connection with any optional
redemption of the Equipment Notes effected in accordance with the Operative
Documents, shall be applied to redemption of the Equipment Notes, to
payment of the Secured Obligations or to the Indenture Trustee or any Note
Holder under the Participation Agreement by applying such funds in the
following order of priority:
First, (i) to reimburse the Indenture Trustee and the Note
Holders for any reasonable costs or expenses incurred in connection with
such redemption for which they are entitled to reimbursement, or indemnity
by Owner, under the Operative Documents and then (ii) to pay any other
amounts then due to the Indenture Trustee and the Note Holders under this
Indenture, the Participation Agreement or the Equipment Notes (other than
the amounts specified in clause Second below);
Second, (i) to pay the amounts specified in paragraph (i) of
clause "Third" of Section 3.03 plus Make-Whole Amount, if any, then due and
payable in respect of the Series A Equipment Notes; (ii) after giving
effect to paragraph (i) above, to pay the amounts specified in paragraph
(ii) of clause "Third" of Section 3.03 plus Make-Whole Amount, if any, then
due and payable in respect of the Series B Equipment Notes; and (iii) after
giving effect to paragraph (ii) above, to pay the amounts specified in
paragraph (iii) of clause "Third" of Section 3.03 plus Make-Whole Amount,
if any, then due and payable in respect of the Series C Equipment Notes;
and
Third, as provided in clause "Fourth" of Section 3.03
hereof.
SECTION 3.03. Payments After Event of Default.
Except as otherwise provided in Section 3.04, all payments
received and amounts held or realized by the Indenture Trustee (including
any amounts realized by the Indenture Trustee from the exercise of any
remedies pursuant to Article IV) after both an Event of Default shall have
occurred and be continuing and the Equipment Notes shall have become due
and payable pursuant to Section 4.04(b), as well as all payments or amounts
then held by the Indenture Trustee as part of the Indenture Estate, shall
be promptly distributed by the Indenture Trustee in the following order of
priority:
First, so much of such payments or amounts as shall be
required to reimburse the Indenture Trustee for any tax, expense 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 Indenture Estate (all such
property being herein called the "Mortgaged Property") pursuant to Section
4.05(b)) incurred by the Indenture Trustee (to the extent not previously
reimbursed), 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 or the Note Holders in the protection, exercise or enforcement of
any right, power or remedy or any damages sustained by the Indenture
Trustee or any Note Holder, liquidated or otherwise, upon such Event of
Default shall be applied by the Indenture Trustee as between itself and the
Note Holders in reimbursement of such expenses and any other expenses for
which the Indenture Trustee or the Note Holders are entitled to
reimbursement under any Operative Document and all amounts payable to the
other Indenture Indemnitees hereunder and under the Participation Agreement
excluding those amounts described in clauses "Second" and "Third" below,
and in the case the aggregate amount to be so distributed is insufficient
to pay as aforesaid, then ratably, without priority of one over the other,
in proportion to the amounts owed each hereunder;
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 (to the extent not previously
reimbursed) shall be distributed to such then existing or prior Note
Holders ratably, without priority of one over the 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;
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 thereon and all other Secured Obligations in respect of the
Series A Equipment Notes 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 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 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 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; and (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 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 plus the accrued but unpaid interest and other amounts due
hereunder or thereunder 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
Fourth, the balance, if any, of such payments or amounts
remaining thereafter shall be distributed to the Owner free and clear of
the Lien of this Indenture.
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
no provision as to the application thereof is made in this Indenture and
for which such provision is made in the Participation Agreement or any
other Operative Document shall be applied forthwith to the purpose for
which such payment was made in accordance with the terms of the
Participation Agreement or such other Operative Document, as the case may
be.
(b) The Indenture Trustee will distribute promptly upon
receipt any indemnity payment received by it from Owner in respect of (i)
the Indenture Trustee in its individual capacity or any other Indenture
Indemnitees, (ii) any Note Holder, (iii) the Subordination Agent, (iv) the
Liquidity Provider, and (v) the Pass Through Trustees, in each case
pursuant to Section 6 of the Participation Agreement, directly to the
Person entitled thereto. Any payment received by the Indenture Trustee the
third paragraph of Section 2.02 shall be distributed to the Subordination
Agent to be distributed in accordance with the terms of the Intercreditor
Agreement.
SECTION 3.05. Other Payments.
Any payments received by the Indenture Trustee for which no
provision as to the application thereof is made in the Participation
Agreement, elsewhere in this Indenture or in any other Operative Document
shall be distributed by the Indenture Trustee in the manner provided in
Section 3.03. Further, and except as otherwise provided in Sections 3.02,
3.03 and 3.04, all payments received and amounts realized by the Indenture
Trustee with respect to the Aircraft, to the extent received or realized at
any time after payment in full of all Secured Obligations due the Note
Holders, shall be distributed by the Indenture Trustee to Owner.
SECTION 3.06. Payments to Owner.
Any amounts distributed hereunder by the Indenture Trustee
to Owner shall be paid to Owner (within the time limits contemplated by
Section 2.04(a)) 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 as shall be designated by notice from Owner to the
Indenture Trustee from time to time. Owner hereby notifies the Indenture
Trustee that unless and until the Indenture Trustee receives notice to the
contrary from the Owner, all amounts to be distributed to the Owner
pursuant to this Indenture shall be distributed by wire transfer of funds
of the type received by the Indenture Trustee to the Owner's account
specified in Schedule I to the Participation Agreement.
ARTICLE IV
CERTAIN COVENANTS OF OWNER; EVENTS OF
DEFAULT; REMEDIES OF INDENTURE TRUSTEE
SECTION 4.01. Certain Covenants of Owner.
Owner hereby covenants and agrees that it 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, if any, payable by it to the Note Holders under the
Participation Agreement.
SECTION 4.02. Event of Default.
"Event of Default" means any of the following events
(whatever the reason for such 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) the failure of Owner to pay when due any payment of
Principal Amount of, interest on, Make-Whole Amount, if any, or other
amount due and payable under any Equipment Note or hereunder and such
failure shall have continued unremedied for ten Business Days in the case
of any payment of Principal Amount or interest or Make-Whole Amount, if
any, thereon and, in the case of any other amount, for ten Business Days
after Owner receives written demand from the Indenture Trustee or any Note
Holder; or
(b) any representation or warranty made by Owner herein, in
the Participation Agreement or in any certificate furnished by Owner to the
Indenture Trustee or any Note Holder in connection with the transactions
contemplated by the Operative Documents shall prove to have been false or
incorrect when made in any material respect and continues to be material
and adverse to the interests of the Indenture Trustee or the Note Holders;
and if such misrepresentation is capable of being corrected and if such
correction is being sought diligently, such misrepresentation shall not
have been corrected within sixty (60) days following notice thereof from
the Indenture Trustee or any Note Holder to the Owner; or
(c) other than as provided in (d) below, any failure by
Owner to observe or perform any other covenant or obligation of the Owner
for the benefit of the Indenture Trustee or the Note Holders contained in
the Participation Agreement, the Equipment Notes or this Indenture which is
not remedied within a period of sixty (60) days after notice thereof has
been given to Owner; or
(d) if at any time when the Aircraft is registered under the
laws of the United States, Owner shall not be a Citizen of the United
States, and as the result thereof the registration of the Aircraft under
the Transportation Code, and regulations then applicable thereunder, shall
cease to be effective; provided that no Event of Default shall be deemed to
have occurred under this paragraph (d) unless such circumstances continue
unremedied for more than sixty (60) days after Owner has actual knowledge
of the state of facts that resulted in such ineffectiveness and of such
loss of citizenship; or
(e) at any time either (i) the commencement of an
involuntary case or other proceeding in respect of Owner under the federal
bankruptcy Laws, as now constituted or hereafter amended, or any other
applicable federal or state bankruptcy, insolvency or other similar Law in
the United States or seeking the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of Owner
or for all or substantially all of its property, or seeking the winding-up
or liquidation of its affairs and the continuation of any such case or
other proceeding undismissed and unstayed for a period of ninety (90)
consecutive days; or (ii) the commencement by Owner of a voluntary case or
proceeding under the federal bankruptcy Laws, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy,
insolvency or other similar Law in the United States, or the consent by
Owner to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator (or other similar official) of
Owner or for all or substantially all of its property, or the making by
Owner of any assignment for the benefit of creditors or Owner shall take
any action to authorize any of the foregoing; or
(f) Owner shall fail to carry and maintain or with respect
to the Aircraft (or cause to be carried or maintained) insurance required
to be maintained in accordance with Section 7.04.
SECTION 4.03. [Reserved].
SECTION 4.04. Remedies.
(a) If an Event of Default shall have occurred and be
continuing and so long as the same shall continue unremedied, then and in
every such case the Indenture Trustee may 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 may take possession of
all or any part of the properties covered or intended to be covered by the
Lien created hereby or pursuant hereto and may exclude Owner and all
persons claiming under Owner wholly or partly therefrom; provided, however,
that during any period the Aircraft is subject to the Civil Reserve Air
Fleet Program and in possession of the United States Government or an
agency or instrumentality of the United States, the Indenture Trustee shall
not, on account of any Event of Default, be entitled to exercise or pursue
any of the powers, rights or remedies described in this Section 4.04 in
such manner as to limit Owner's control (or any Lessee's control under any
Lease) of any Airframe or any Engines installed thereon, unless at least
sixty (60) days (or such lesser period as may then be applicable under the
Air Mobility Command program of the United States Government) written
notice of default hereunder shall have been given by the Indenture Trustee
by registered or certified mail to Owner (and any Lessee) with a copy
addressed to the Contracting Office Representative of the Air Mobility
Command of the United States Air Force under any contract with Owner (or
any Lessee) relating to the Aircraft; provided further, that the Indenture
Trustee shall give Owner twenty (20) 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.
(b) If an Event of Default 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), at any time, by delivery of written notice or
notices to Owner, declare all the 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 (without
Make-Whole Amount) and other amounts due thereunder, shall immediately
become due and payable without presentment, demand, protest or notice, all
of which are hereby waived; provided that if an Event of Default referred
to in clause (e) of Section 4.02 shall have occurred and be continuing,
then and in every such case the unpaid Principal Amount 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.
This Section 4.04(b), however, is 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
Equipment Notes which by such declaration shall have become payable) shall
have been duly paid, and every other Default and 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 Default or Event of Default or impair any right
consequent thereon.
(c) Any Note Holder shall be entitled, at any sale pursuant
to this Section 4.04, to credit against any purchase price bid at such sale
by such holder all or any part of the unpaid obligations owing to such Note
Holder and secured by the Lien of this Indenture (but only to the extent
that such purchase price would have been paid to such Note Holder pursuant
to Article III if such purchase price were paid in cash and the foregoing
provisions of this subsection (c) were not given effect).
(d) In the event of any sale of the Indenture Estate, or any
part thereof, pursuant to any judgment or decree of any court or otherwise
in connection with the enforcement of any of the terms of this Indenture,
the unpaid Principal Amount of all Equipment Notes then outstanding,
together with accrued interest thereon, and other amounts due thereunder,
shall immediately become due and payable without presentment, demand,
protest or notice, all of which are hereby waived.
(e) 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 Mortgaged
Property or take any action with respect to any Mortgaged Property so
acquired by it if such acquisition or action would cause any Pass Through
Trust to fail to qualify as a "grantor trust" for federal income tax
purposes.
SECTION 4.05. Return of Aircraft, Etc.
(a) If an Event of Default shall have occurred and be
continuing, at the request of the Indenture Trustee, Owner shall promptly
execute and deliver to the Indenture Trustee such instruments 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
Indenture Trustee may specify, to obtain possession of all or any part of
the Mortgaged Property included in the Indenture Estate to which the
Indenture Trustee shall at the time be entitled hereunder. If Owner 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 to execute and deliver such
instruments and documents to the Indenture Trustee, to the entry of which
judgment Owner hereby specifically consents to the fullest extent permitted
by applicable law, and (ii) pursue all or part of such Mortgaged Property
wherever it may be found and may enter any of the premises of Owner
wherever such Mortgaged Property may be or be supposed to be and search for
such Mortgaged Property and take possession of and remove such Mortgaged
Property. 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 every such taking of possession, the Indenture
Trustee may, from time to time, at the expense of the Mortgaged Property,
make all such expenditures for maintenance, use, operation, storage,
insurance, leasing, control, management, disposition, modifications or
alterations to and of the Mortgaged Property, as it may deem proper. In
each such case, the Indenture Trustee shall have the right to maintain,
use, operate, store, insure, lease, control, manage, dispose of, modify or
alter the Mortgaged Property and to carry on the business and to exercise
all rights and powers of Owner relating to the Mortgaged Property, as the
Indenture Trustee shall deem best, including the right to enter into any
and all such agreements with respect to the maintenance, use, operation,
storage, insurance, leasing, control, management, disposition, modification
or alteration of the Mortgaged Property 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, revenues,
issues, income, products and profits of the Mortgaged Property and every
part thereof. Such tolls, rents, revenues, issues, income, products and
profits shall be applied to pay the expenses of the maintenance, use,
operation, storage, insurance, leasing, control, management, disposition,
improvement, modification or alteration of the Mortgaged Property and of
conducting the business thereof, 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 Mortgaged Property
or any part thereof, and all other payments which 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 with respect hereto.
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
Owner or to be an acquiescence therein.
SECTION 4.07. Discontinuance of Proceedings.
In case the Indenture Trustee 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 Trustee, then and in every such case Owner and
the Indenture Trustee shall, subject to any determination in such
proceedings, be restored to their former positions and rights hereunder
with respect to the Mortgaged Property, and all rights, remedies and powers
of the Indenture Trustee or Owner shall continue as if no such proceedings
had been instituted.
SECTION 4.08. Waiver of Past Defaults.
Upon written instruction from a Majority in Interest of Note
Holders, the Indenture Trustee shall waive any past Default hereunder and
its consequences and upon any such waiver such Default shall cease to exist
and any 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 Default or impair any right consequent thereon;
provided, that in the absence of written instructions from all the Note
Holders, the Indenture Trustee shall not waive any Default (i) in the
payment of the Principal Amount, Make-Whole Amount, if any, and interest
and other amounts due under any Equipment Note then outstanding, or (ii) in
respect of a covenant or provision hereof which, under Article IX, cannot
be modified or amended without the consent of each Note Holder.
SECTION 4.09. Appointment of Receiver.
If an Event of Default shall have occurred and be
continuing, the Indenture Trustee shall, as a matter of right, be entitled
to the appointment of a receiver (who may be the Indenture Trustee or any
successor or nominee thereof) for all or any part of the Mortgaged
Property, whether such receivership be incidental to a proposed sale of the
Mortgaged Property or the taking of possession thereof or otherwise, and
Owner hereby consents to the appointment of such a receiver and will not
oppose any such appointment. Any receiver appointed for all or any part of
the Mortgaged Property shall be entitled to exercise all the rights and
powers of the Indenture Trustee with respect to the Mortgaged Property.
SECTION 4.10. Indenture Trustee Authorized to Execute Bills
of Sale, Etc.
Owner irrevocably appoints the Indenture Trustee the true
and lawful attorney-in-fact of Owner in its name and stead and on its
behalf, for the purpose, if an Event of Default shall have occurred and be
continuing, of effectuating in accordance with applicable law any sale,
assignment, transfer or delivery for the enforcement of the Lien of this
Indenture, whether pursuant to foreclosure or power of sale, assignments
and other instruments as may be necessary or appropriate, with full power
of substitution, Owner hereby ratifying and confirming all that such
attorney or any substitute shall do by virtue hereof in accordance with
applicable law. Nevertheless, if so requested by the Indenture Trustee or
any purchaser, Owner shall ratify and confirm any such sale, assignment,
transfer or delivery, by executing and delivering to the Indenture Trustee
or such purchaser all bills of sale, assignments, releases and other proper
instruments to effect such ratification and confirmation as may be
designated in any such request.
SECTION 4.11. Rights of Note Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Note Holder to receive payment of principal of, and premium,
if any, and interest on an Equipment Note on or after the respective due
dates expressed in such Equipment Note, or to bring suit for the
enforcement of any such payment on or after such respective dates in
accordance with the terms hereof, shall not be impaired or affected without
the consent of such Note Holder.
ARTICLE V
DUTIES OF THE INDENTURE TRUSTEE
SECTION 5.01. Notice of Event of Default.
If the Indenture Trustee shall have Actual Knowledge of an
Event of Default or of a Default arising from a failure by Owner to pay
when due any payment of Principal Amount of, interest on, or Make-Whole
Amount, if any, due and payable under any Equipment Note, the Indenture
Trustee shall give prompt written notice thereof to the Owner and each Note
Holder. Subject to the terms of Sections 4.04, 4.08, 5.02 and 5.03, the
Indenture Trustee shall take such action, or refrain from taking such
action, with respect to such Event of Default or 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, if the
Indenture Trustee shall not have received instructions as above provided
within twenty (20) days after mailing notice of such 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 Event of Default or Default as it shall determine advisable in the
best interests of the Note Holders.
SECTION 5.02. Action upon Instructions; Certain Rights and
Limitations.
Subject to the terms of Sections 4.04, 4.08, 5.01 and 5.03,
upon the written instructions at any time and from time to time of a
Majority in Interest of Note Holders, the Indenture Trustee shall, subject
to the terms of this Section 5.02, take such of the following actions as
may be specified in such instructions: (i) give such notice or direction or
exercise such right, remedy or power hereunder as shall be specified in
such instructions; and (ii) give such notice or direction or exercise such
right, remedy or power under the Participation Agreement, the Purchase
Agreement, or any other part of the Indenture Estate as shall be specified
in such instructions.
The Indenture Trustee will execute and Owner will file or
cause to be filed such continuation statements with respect to financing
statements relating to the security interest created hereunder in the
Indenture Estate as specified by Owner pursuant to Section 7(j) of the
Participation Agreement or 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 form of such continuation statement so to be filed). 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
hereunder.
SECTION 5.03. Indemnification.
The Indenture Trustee shall not be required to take any
action or refrain from taking any action under Sections 5.01 (other than
the first sentence thereof) or 5.02 or Article IV unless the Indenture
Trustee shall have been indemnified to its reasonable satisfaction against
any liability, cost or expense (including counsel fees) which may be
incurred in connection therewith pursuant to a written agreement with one
or more Note Holders. The Indenture Trustee shall not be under any
obligation to take any action under this Indenture and nothing herein or
therein shall require the Indenture Trustee to expend or risk its own funds
or otherwise incur the risk of any financial liability in the performance
of any of its rights or powers if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it (the written indemnity of
any Note Holder who is a QIB, signed by an authorized officer thereof, in
favor of, delivered to and in form reasonably satisfactory to Indenture
Trustee shall be accepted as reasonable assurance of adequate indemnity).
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,
nor shall any other provision of this Indenture or any other Operative
Document 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 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 use, operate, store, lease, control, manage, sell, dispose of or
otherwise deal with the Aircraft or any other part of the Indenture Estate,
or to otherwise take or refrain from taking any action under, or in
connection with, this Indenture or any part of the 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. 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
Section 8.01), promptly take such action as may be necessary duly to
discharge all liens and encumbrances on any part of the Indenture Estate
which result from claims against it in its individual capacity not related
to its interest in the Aircraft or the administration of the Indenture
Estate or any other transaction pursuant to this Indenture or any document
included in the Indenture Estate.
SECTION 5.05. No Action Except Under Indenture or
Instructions.
The Indenture Trustee agrees that it will not use, operate,
store, lease, control, manage, sell, dispose of or otherwise deal with the
Aircraft or any other part of the Indenture Estate except in accordance
with the powers granted to, or the authority conferred upon, the Indenture
Trustee pursuant to this Indenture and in accordance with the express terms
hereof.
SECTION 5.06. Replacement Airframes and Replacement Engines.
(a) Event of Loss with Respect to the Aircraft. Upon the
occurrence of an Event of Loss with respect to the Airframe or the Airframe
and the Engines and/or engines then installed thereon, Owner shall
forthwith (and in any event, within fifteen (15) days after such
occurrence) give the Indenture Trustee written notice of such Event of
Loss, and, within sixty (60) days after such Event of Loss, Owner shall
give the Indenture Trustee written notice of its election to perform one of
the following options (it being agreed that if Owner shall not have given
such notice of election within such period, Owner shall be deemed to have
elected the option set forth in clause (i) below). Owner may elect either
to:
(i) redeem the Equipment Notes in the
manner set forth in Section 2.10 on the earlier of (x) the Business
Day next succeeding the 120th day following the occurrence of such
Event of Loss or (y) an earlier Business Day irrevocably specified
fifteen (15) days in advance by notice from Owner to the Indenture
Trustee; or
(ii) substitute an aircraft or an airframe
or an airframe and one or more engines, as the case may be;
provided that, if Owner does not perform its obligation to effect
such substitution in accordance with this Section 5.06(a), during
the period of time provided herein, then Owner shall redeem the
Equipment Notes in the manner set forth in Section 2.10 on the
Business Day next succeeding the 120th day following the occurrence
of such Event of Loss.
In the event Owner shall elect to substitute an aircraft (or
an airframe or an airframe and one or more engines, as the case may be)
Owner shall, at its sole expense, not later than the Business Day next
succeeding the 120th day following the occurrence of such Event of Loss,
(1) furnish the Indenture Trustee with such evidence as the Indenture
Trustee may reasonably request that Owner holds title to such aircraft (or
such airframe or such airframe and one or more engines which, together with
the Engines constituting a part of the Aircraft but not installed thereon
at the time of such Event of Loss, constitute the Aircraft) free and clear
of all Liens (other than Permitted Liens) and having a value, utility and
remaining useful life at least equal to the Aircraft subject to such Event
of Loss assuming that the Aircraft had been maintained in accordance with
the requirements of this Indenture, and Owner shall cause an Indenture
Supplement to be duly executed by Owner and filed for recording pursuant to
the Transportation Code, or the applicable laws, rules and regulations of
any other jurisdiction in which the Airframe may then be registered as
permitted by Section 7(b) of the Participation Agreement with respect to
such substituted property, (2) cause a financing statement or statements
with respect to such substituted property to be filed in such place or
places, if any, as may be deemed necessary or desirable by the Indenture
Trustee to perfect the Indenture Trustee's interest therein, (3) furnish
the Indenture Trustee with such evidence of compliance with the insurance
provisions hereof with respect to such substituted property as the
Indenture Trustee may reasonably request and (4) furnish the Indenture
Trustee with an opinion of counsel (which shall be Skadden, Arps, Slate,
Meagher & Flom LLP or Skadden, Arps, Slate, Meagher & Flom (Illinois) and,
if not, other counsel chosen by Owner and reasonably acceptable to the
Indenture Trustee) reasonably satisfactory to the Indenture Trustee to the
effect that the Indenture Trustee will be entitled to the benefits of
Section 1110 of the Bankruptcy Code with respect to the substitute
aircraft, provided that such opinion need not be delivered to the extent
that immediately prior to such substitution the benefits of Section 1110 of
the Bankruptcy Code were not, solely by reason of a change in law or
governmental interpretation thereof after the date hereof, available to the
Indenture Trustee with respect to the Aircraft. For all purposes hereof,
the property so substituted shall be deemed part of the property subject to
the Lien of this Indenture and shall be deemed an "Aircraft", "Airframe"
and "Engine", as the case may be, as defined herein.
(b) Event of Loss with Respect to an Engine. Upon the
occurrence of an Event of Loss with respect to an Engine under
circumstances in which there has not occurred an Event of Loss with respect
to the Airframe, Owner shall forthwith (and in any event, within fifteen
(15) days after such occurrence) give the Indenture Trustee written notice
thereof and shall, within one hundred twenty (120) days after the
occurrence of such Event of Loss, (i) cause an Indenture Supplement to be
duly executed by Owner and to be filed for recording pursuant to the
Transportation Code, or the applicable laws, rules and regulations of any
other jurisdiction in which the Airframe may then be registered as
permitted by Section 7(b) of the Participation Agreement with respect to an
Acceptable Alternate Engine and, (ii) furnish the Indenture Trustee with
such evidence of compliance with the insurance provisions hereof with
respect to such replacement engine as the Indenture Trustee may reasonably
request. For all purposes hereof, each such replacement engine shall, after
such designation, be deemed part of the property subject to the Lien of
this Indenture hereunder, and shall be deemed an "Engine".
(c) Requisition for Use of an Engine by the United States
Government or the Government of Registry of the Aircraft. In the event of
the requisition for use of an Engine by the United States Government or any
other government of registry of the Aircraft or any agency or
instrumentality of any thereof, Owner shall replace such Engine hereunder
by complying (or causing any Lessee to comply) with the terms of Section
5.06(b) to the same extent as if an Event of Loss had occurred with respect
thereto, and, upon compliance with Section 5.06(b), any payments received
by Owner from such government with respect to such requisition shall be
paid over to, or retained by, Owner.
(d) Application of Payments During Existence of Event of
Default. Any amount referred to in this Section 5.06 which is payable to or
retainable by Owner shall not be paid to or retained by Owner if at the
time of such payment or retention an Event of Default has occurred and is
continuing, but shall be held by or paid over to the Indenture Trustee as
security for the obligations of Owner hereunder and, if an Event of Default
has occurred and is continuing hereunder, applied against Owner's
obligations hereunder as and when due. At such time as there shall not be
continuing any such Event of Default, such amount shall be paid to Owner to
the extent not previously applied in accordance with the preceding
sentence.
SECTION 5.07. Indenture Supplements for Replacements.
If a Replacement Airframe or Replacement Engine is being
substituted as contemplated by Section 5.06, Owner and the Indenture
Trustee agree for the benefit of the Note Holders and Owner, subject to
fulfillment of the conditions precedent and compliance by Owner with the
requirements of Section 5.06 with respect to such Replacement Airframe or
Replacement Engine, to execute and deliver an Indenture Supplement.
SECTION 5.08. Effect of Replacement.
In the event of the substitution of an Airframe or of an
Engine or Engines pursuant to Section 5.06, (a) all provisions of this
Indenture relating to the Airframe or Engine or Engines being replaced
shall be applicable to such Replacement Airframe or Replacement Engine or
Engines with the same force and effect as if such Replacement Airframe or
Replacement Engine or Engines were the same airframe or engine or engines,
as the case may be, as the Airframe or Engine or Engines being replaced but
for the Event of Loss with respect to the Airframe or Engine or Engines
being replaced, and (b) the provisions of this Indenture shall no longer be
applicable to the Airframe or Engine or Engines being replaced, which shall
be released from the Lien of this Indenture.
SECTION 5.09. Investment of Amounts Held by Indenture
Trustee.
Any amounts held by the Indenture Trustee 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 shall be invested by the Indenture Trustee from
time to time in Cash Equivalents as directed by Owner so long as the
Indenture Trustee may acquire the same using its best efforts. Unless
otherwise expressly provided in this Indenture, any income realized as a
result of any such investment, 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 such sale is necessary to make a
distribution required by this Indenture.
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.01. Acceptance of Trusts and Duties.
The Indenture Trustee accepts the duties hereby created and
applicable to it and agrees to perform the same but only upon the terms of
this Indenture and agrees to receive and disburse all monies constituting
part of the Indenture Estate in accordance with the terms hereof. The
Indenture Trustee, in its individual capacity, shall not be answerable or
accountable under any circumstances, except (i) for willful misconduct or
gross negligence (other than for the handling of funds, for which the
standard of accountability shall be willful misconduct or negligence), (ii)
as provided in the fourth sentence of Section 2.04(a) and the last sentence
of Section 5.04, and (iii) for liabilities that may result from the
inaccuracy of any representation or warranty of the Indenture Trustee (in
its individual capacity) in the Participation Agreement or expressly made
hereunder.
SECTION 6.02. Absence of Duties.
Except in accordance with written instructions furnished
pursuant to Section 5.01 or 5.02 , and except as provided in, and without
limiting the generality of, Sections 5.03 and 5.04, the Indenture Trustee
shall have no duty (i) to see to any registration of the Aircraft or any
recording or filing 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 or to effect or maintain any such
insurance, whether or not Owner shall be in default with respect thereto,
(iii) to see to the payment or discharge of any lien or encumbrance of any
kind against any part of the Indenture Estate, or (iv) to inspect the
Aircraft at any time or ascertain or inquire as to the performance or
observance of any of Owner's covenants hereunder with respect to the
Aircraft.
SECTION 6.03. No Representations or Warranties as to
Aircraft or Documents.
THE INDENTURE TRUSTEE IN ITS INDIVIDUAL OR TRUST CAPACITY
DOES NOT MAKES AND SHALL NOT BE DEEMED TO HAVE MADE AND HEREBY EXPRESSLY
DISCLAIMS ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE
TITLE, AIRWORTHINESS, VALUE, COMPLIANCE WITH SPECIFICATIONS, CONDITION,
DESIGN, QUALITY, DURABILITY, OPERATION, MERCHANTABILITY OR FITNESS FOR
USE FOR A PARTICULAR PURPOSE OF THE AIRCRAFT OR ANY ENGINE, 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 WHATSOEVER. The Indenture Trustee, in
its individual or trust capacity, does not make and shall not be deemed to
have made any representation or warranty as to the validity, legality or
enforceability of this Indenture, the Participation Agreement, the
Equipment Notes, the Purchase Agreement, the Purchase Agreement Assignment
or the Consent and Agreement, or as to the correctness of any statement
contained in any thereof.
SECTION 6.04. No Segregation of Monies; No Interest.
Any monies paid to or retained by the Indenture Trustee
pursuant to any provision hereof and not then required to be distributed to
the Note Holders or the Owner as provided in Article III need not be
segregated in any manner except to the extent required by Law and Section
5.09, and may be deposited under such general conditions as may be
prescribed by Law, and the Indenture Trustee shall not be liable for any
interest thereon (except that the Indenture Trustee shall invest all monies
held as directed by Owner so long as no Event of Default has occurred and
is continuing (or in the absence of such direction, by the Majority In
Interest of Note Holders) in Cash Equivalents; provided, however, 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; Agreements; Advice of Counsel.
The Indenture Trustee shall not 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 genuine and believed by it to be
signed by the proper party or parties. The Indenture Trustee may accept a
copy of a resolution of the Board of Directors of any party to the
Participation 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, Owner 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 Owner the manner of ascertainment of which is not
specifically described herein, the Indenture Trustee may for all purposes
hereof rely on a certificate, signed by a duly authorized officer of Owner,
as to such fact or matter, and such certificate shall constitute full
protection to the Indenture Trustee for any action taken or omitted to be
taken by it in good faith in reliance thereon. In the administration of the
trusts hereunder, the Indenture Trustee may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or
through agents or attorneys and may at the expense of the Indenture Estate,
consult with counsel, accountants and other skilled persons to be selected
and retained by it, and the Indenture Trustee shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with
the advice or opinion of any such counsel, accountants or other skilled
persons.
SECTION 6.06. [Reserved].
SECTION 6.07. Compensation.
The Indenture Trustee shall be entitled to reasonable
compensation, including expenses and disbursements (including the
reasonable fees and expenses of counsel), for all services rendered
hereunder and shall, on and subsequent to an Event of Default hereunder,
have a priority claim on the Indenture Estate for the payment of such
compensation, to the extent that such compensation shall not be paid by
Owner, and shall have the right, on and subsequent to an Event of Default
hereunder, to use or apply any monies held by it hereunder in the Indenture
Estate toward such payments. The Indenture Trustee agrees that it shall
have no right against the Loan Participants or the Note Holders for any fee
as compensation for its services as trustee under this Indenture.
SECTION 6.08. Instructions from Note Holders.
In the administration of the trusts created hereunder, the
Indenture Trustee shall have the right to seek instructions from a Majority
in Interest of Note Holders should any provision of this Indenture appear
to conflict with any other provision herein or should the Indenture
Trustee's duties or obligations hereunder be unclear, and the Indenture
Trustee shall incur no liability in refraining from acting until it
receives such instructions. The Indenture Trustee shall be fully protected
for acting in accordance with any instructions received under this Section
6.08.
ARTICLE VII
OPERATING COVENANTS OF THE OWNER
SECTION 7.01. Liens. Owner will not directly or indirectly
create, incur, assume or suffer to exist any Lien on or with respect to the
Aircraft, title thereto or any interest therein, except (i) the Lien of the
Indenture, the rights of any Lessee under a Lease permitted hereunder and
any other rights of any Person existing pursuant to the Operative
Documents, (ii) the rights of others under agreements or arrangements to
the extent permitted by the terms of Sections 7.02 and 7.03, (iii) Loan
Participant Liens and Indenture Trustee's Liens, (iv) Liens for Taxes of
Owner (or any Lessee) either not yet due or being contested in good faith
by appropriate proceedings so long as such proceedings do not involve any
material risk of the sale, forfeiture or loss of the Airframe or any Engine
or any interest therein, (v) materialmen's, mechanics', workmen's,
repairmen's, employees' or other like Liens arising in the ordinary course
of Owner's (or, if a Lease is then in effect, Lessee's) business (including
those arising under maintenance agreements entered into in the ordinary
course of business) securing obligations that are not overdue for a period
of more than sixty (60) days or are being contested in good faith by
appropriate proceedings so long as such proceedings do not involve any
material risk of the sale, forfeiture or loss of the Airframe or any Engine
or any interest therein, (vi) Liens arising out of any judgment or award
against Owner (or any Lessee), unless the judgment secured shall not,
within sixty (60) days after the entry thereof, have been discharged,
vacated, reversed or execution thereof stayed pending appeal or shall not
have been discharged, vacated or reversed within sixty (60) days after the
expiration of such stay, (vii) any other Lien with respect to which Owner
(or any Lessee) shall have provided a bond, cash collateral or other
security adequate in the reasonable opinion of the Indenture Trustee, and
(viii) Liens approved in writing by the Indenture Trustee. Owner will
promptly, at its own expense, take (or cause to be taken) such actions as
may be necessary duly to discharge any such Lien not excepted above if the
same shall arise at any time.
SECTION 7.02. Registration, Maintenance and Operation;
Possession and Leases; Insignia.
(a) Registration, Maintenance and Operation.
(i) Registration and Maintenance. Owner,
at its own cost and expense, shall (or shall cause any Lessee to):
(A) cause the Aircraft to be duly registered in the name of Owner
(or any Lessee), and, subject to clause (ii) of this Section
7.02(a) and Section 7(b) of the Participation Agreement, to remain
duly registered in the name of Owner (or any Lessee) under the
Transportation Code, and shall not register the Aircraft or permit
the Aircraft to be registered under any laws other than the
Transportation Code at any time except as provided in Section 7(b)
of the Participation Agreement and, shall cause the Indenture to be
duly recorded and maintained of record as a first mortgage on the
Aircraft; (B) maintain, service, repair and/or overhaul (or cause
to be maintained, serviced, repaired and/or overhauled) the
Aircraft so as to keep the Aircraft in as good an operating
condition as when delivered by the Seller to Owner, ordinary wear
and tear excepted, and as may be necessary to enable the applicable
airworthiness certification for the Aircraft to be maintained in
good standing at all times (other than during temporary periods of
storage or during maintenance or modification permitted hereunder)
under the Transportation Code, except when all of Owner's Airbus
Model A___ aircraft powered by engines of the same type as those
with which the Airframe shall be equipped at the time of such
grounding and registered in the United States have been grounded by
the FAA (although such certification need actually be maintained
only during such periods as the Aircraft is registered in the
United States), or the applicable laws of any other jurisdiction in
which the Aircraft may then be registered from time to time in
accordance with Section 7(b) of the Participation Agreement,
utilizing, except during any period that a Lease is in effect, the
same manner and standard of maintenance, service, repair or
overhaul used by Owner with respect to similar aircraft operated by
Owner in similar circumstances and utilizing, during any period
that a Lease is in effect, the same manner and standard of
maintenance, service, repair or overhaul used by the Lessee with
respect to similar aircraft operated by the Lessee in similar
circumstances; and (C) maintain or cause to be maintained in
English all records, logs and other materials required to be
maintained in respect of the Aircraft by the FAA or the applicable
regulatory agency or body of any other jurisdiction in which the
Aircraft may then be registered.
(ii) Operation. Owner will not maintain,
use, service, repair, overhaul or operate the Aircraft (or permit
any Lessee to maintain, use, service, repair, overhaul or operate
the Aircraft) in violation of any law or any rule, regulation,
order or certificate of any government or governmental authority
(domestic or foreign) having jurisdiction over the Aircraft, or in
violation of any airworthiness certificate, license or registration
relating to the Aircraft issued by any such authority, except to
the extent Owner (or, if a Lease is then in effect, any Lessee) is
contesting in good faith the validity or application of any such
law, rule, regulation or order in any reasonable manner which does
not involve any material risk of sale, forfeiture or loss of the
Aircraft. Owner will not operate the Aircraft, or permit any Lessee
to operate the Aircraft, in any area excluded from coverage by any
insurance required by the terms of Section 7.04; provided, however,
that the failure of Owner to comply with the provisions of this
sentence shall not give rise to an Event of Default hereunder if
indemnification complying with Section 7.04 has been provided or
where such failure is attributable to extraordinary circumstances
involving an isolated occurrence or series of incidents not in the
ordinary course of the regular operations of Owner (or any Lessee)
such as a hijacking, medical emergency, equipment malfunction,
weather condition, navigational error or other causes beyond the
reasonable control of Owner (or any Lessee).
(b) Possession and Leases. Owner will not, without the prior
written consent of the Indenture Trustee, lease or otherwise in any manner
deliver, transfer or relinquish possession of the Airframe or any Engine or
install or permit any Engine to be installed on any airframe other than the
Airframe or enter into any Wet Lease, and so long as Owner (or any Lessee)
shall comply with the provisions of Section 7.02(a) and Section 7.04, Owner
may (or may permit any Lessee to), without the prior written consent of the
Indenture Trustee:
(i) subject the Airframe and the Engines or
engines then installed thereon to interchange agreements or any
Engine to pooling or similar arrangements, in each case customary
in the airline industry and entered into by Owner (or, if a Lease
is then in effect, by Lessee) in the ordinary course of its
business; provided that (A) no such agreement or arrangement
contemplates or requires the transfer of title to the Airframe, (B)
if Owner's title to any Engine shall be divested under any such
agreement or arrangement, such divestiture shall be deemed to be an
Event of Loss with respect to such Engine and Owner shall (or shall
cause Lessee to) comply with Section 5.06(b) in respect thereof,
and (C) any interchange agreement to which the Airframe may be
subject shall be with a U.S. Air Carrier or a Foreign Air Carrier.
(ii) deliver possession of the Airframe or
any Engine to the manufacturer thereof (or for delivery thereto) or
to any organization (or for delivery thereto) for testing, service,
repair, maintenance or overhaul work on the Airframe or Engine or
any part of any thereof or for alterations or modifications in or
additions to such Airframe or Engine to the extent required or
permitted by the terms of Section 7.03;
(iii) install an Engine on an airframe owned
by Owner (or any Lessee) free and clear of all Liens, except: (A)
Permitted Liens and those which apply only to the engines (other
than Engines), appliances, parts, instruments, appurtenances,
accessories, furnishings and other equipment (other than Parts)
installed on such airframe (but not to the airframe as an
entirety), (B) the rights of third parties under interchange
agreements or pooling or similar arrangements which would be
permitted under clause (i) above, provided that Owner's title to
such Engine and the first priority Lien of the Indenture shall not
be divested or impaired as a result thereof and (C) mortgage liens
or other security interests, provided that (as regards this clause
(C)) the documents creating such mortgage liens or other security
interests (or, if applicable, another written agreement governing
such mortgage liens or other security interests) effectively
provide that such Engine shall not become subject to the lien of
such mortgage or security interest, notwithstanding the
installation thereof on such airframe;
(iv) install an Engine on an airframe leased
to Owner (or any Lessee) or purchased by Owner (or any Lessee)
subject to a conditional sale or other security agreement, provided
that (x) such airframe is free and clear of all Liens, except: (A)
the rights of the parties to the lease or conditional sale or other
security agreement covering such airframe, or their assignees, and
(B) Liens of the type permitted by clause (iii) of this paragraph
(b) and (y) such lease, conditional sale or other security
agreement effectively provides that such Engine shall not become
subject to the lien of such lease, conditional sale or other
security agreement, notwithstanding the installation thereof on
such airframe;
(v) install an Engine on an airframe owned
by Owner (or any Lessee), leased to Owner (or any Lessee) or
purchased by Owner (or any Lessee) subject to a conditional sale or
other security agreement under circumstances where neither clause
(iii) nor clause (iv) of this paragraph (b) is applicable, provided
that such installation shall be deemed an Event of Loss with
respect to such Engine and Owner shall (or shall cause any Lessee
to) comply with Section 5.06(b) in respect thereof;
(vi) to the extent permitted by this Section
7.02(b), subject any appliances, Parts or other equipment removed from
the Airframe or any Engine to any pooling arrangement referred to in
this Section 7.02(b);
(vii) subject (or permit any Lessee to
subject) the Airframe or any Engine to the Civil Reserve Air Fleet
Program and transfer (or permit any Lessee to transfer) possession
of the Airframe or any Engine to the United States Government or
any instrumentality or agency thereof pursuant to the Civil Reserve
Air Fleet Program, so long as Owner (or any Lessee) shall (A)
promptly notify the Indenture Trustee upon subjecting the Airframe
or any Engine to the Civil Reserve Air Fleet Program in any
contract year and provide the Indenture Trustee with the name and
address of the Contracting Office Representative for the Air
Mobility Command of the United States Air Force to whom notice must
be given pursuant to Section 4.04(a), and (B) promptly notify the
Indenture Trustee upon transferring possession of the Airframe or
any Engine to the United States of America or any agency or
instrumentality thereof pursuant to such program;
(viii) enter into a Wet Lease for the
Airframe and Engines or engines then installed thereon with any
third party;
(ix) transfer possession of the Airframe or
any Engine to the United States Government or any instrumentality
or agency thereof pursuant to a contract, a copy of which shall be
provided to the Indenture Trustee; or
(x) at any time, in Owner's sole
discretion, enter into any lease with respect to the Aircraft,
Airframe or any Engine to any Permitted Lessee that is not then
subject to any bankruptcy, insolvency, liquidation, reorganization,
dissolution or similar proceeding and shall not have substantially
all of its property in the possession of any liquidator, trustee,
receiver or similar person; provided, however, with respect to a
lease to a Permitted Lessee not domiciled in the United States,
Owner shall deliver to the Indenture Trustee an opinion of counsel
to the effect that (I) the terms of the lease constitute valid and
binding obligations of the Lessee and (subject to customary
bankruptcy and equitable remedies exceptions and to other similar
exceptions customary in such opinions) enforceable against Lessee
(it being understood that such opinion may be an opinion as to the
form of the lease only and may assume due authorization, execution,
delivery, requisite approvals and absence of conflicts with laws,
contracts or organizational documents) under the laws of the
jurisdiction governing the lease and (II) unless Owner shall have
agreed to provide insurance covering the risk of requisition of use
of the Aircraft by the government of the jurisdiction of the
proposed Lessee, that the laws of such jurisdiction require fair
compensation by the government of such jurisdiction payable in
currency freely convertible into Dollars for the loss of use of the
Aircraft in the event of the requisition by such government of such
use; and provided, further, that, with respect to any lease to any
Affiliate of Owner, (I) such Lessee shall be a Certificated Air
Carrier and (II) Owner shall deliver to the Indenture Trustee an
opinion of counsel to the effect that Owner would be entitled to
the benefits of Section 1110 of the Bankruptcy Code with respect to
the Aircraft if such Affiliate were to be a debtor in a case under
Chapter 11 of the Bankruptcy Code, such opinion to be subject to
customary assumptions and qualifications. Owner shall provide the
Indenture Trustee with a copy of any sublease which has a term of
more than one (1) year.
The rights of any Lessee or other transferee who receives
possession by reason of a transfer permitted by this paragraph (b) (other
than the transfer of an Engine which is deemed an Event of Loss) shall be
subject and subordinate to, and any Lease permitted by this paragraph (b)
shall be expressly subject and subordinate to the Indenture Trustee's
rights to repossess and to void such Lease upon such repossession, and
Owner shall remain primarily liable hereunder for the performance of all of
the terms of this Indenture and the terms of any such Lease shall not
permit any Lessee to take any action not permitted to be taken by Owner
hereunder with respect to the Aircraft. No pooling agreement, sublease or
other relinquishment of possession of the Airframe or any Engine or Wet
Lease shall in any way discharge or diminish any of Owner's obligations
hereunder or constitute a waiver of the Indenture Trustee's rights or
remedies hereunder. The Indenture Trustee agrees, for the benefit of Owner
(and any Lessee) and for the benefit of any mortgagee or other holder of a
security interest in any engine (other than an Engine) owned by Owner (or
any Lessee), any lessor of any engine (other than an Engine) leased to
Owner (or any Lessee) and any conditional vendor of any engine (other than
an Engine) purchased by Owner (or any Lessee) subject to a conditional sale
agreement or any other security agreement, that no interest shall be
created hereunder in any engine so owned, leased or purchased and that none
of the Indenture Trustee, its successors or assigns will acquire or claim,
as against Owner (or any Lessee) or any such mortgagee, lessor or
conditional vendor or other holder of a security interest or any successor
or assignee of any thereof, any right, title or interest in such engine as
the result of such engine being installed on the Airframe.
Any Wet Lease or similar arrangement under which Owner
maintains operational control of the Aircraft shall not constitute a
delivery, transfer or relinquishment of possession of the Aircraft for
purposes of this Section.
The Indenture Trustee acknowledges that any consolidation or
merger of Owner or conveyance, transfer or lease of all or substantially
all of Owner's assets otherwise permitted by the Operative Documents shall
not be prohibited by this Section.
(c) Insignia. On or prior to the Delivery Date, or as soon
as practicable thereafter, Owner agrees to affix and maintain (or cause to
be affixed and maintained), at its expense, in the cockpit of the Airframe
adjacent to the airworthiness certificate therein and on each Engine a
nameplate bearing the inscription:
Mortgaged To
State Street Bank and Trust Company of Connecticut,
National Association,
as Indenture Trustee
(such nameplate to be replaced, if necessary, with a nameplate reflecting
the name of any successor Indenture Trustee, as permitted under the
Operative Documents). Except as above provided, Owner will not allow the
name of any Person to be placed on the Airframe or on any Engine as a
designation that might be interpreted as a claim of ownership; provided
that nothing herein contained shall prohibit Owner (or any Lessee) from
placing its customary colors and insignia on the Airframe or any Engine.
SECTION 7.03. Replacement and Pooling of Parts;
Alterations, Modifications and Additions.
(a) Replacement of Parts. Owner, at its own cost and
expense, will promptly replace or cause to be replaced all Parts which may
from time to time be incorporated or installed in or attached to the
Airframe or any Engine and which may from time to time become worn out,
lost, stolen, destroyed, seized, confiscated, damaged beyond repair or
permanently rendered unfit for use for any reason whatsoever, except as
otherwise provided in paragraph (c) of this Section 7.03 or if the Airframe
or an Engine to which a Part relates has suffered an Event of Loss. In
addition, Owner (or any Lessee) may, at its own cost and expense, remove in
the ordinary course of maintenance, service, repair, overhaul or testing,
any Parts, whether or not worn out, lost, stolen, destroyed, seized,
confiscated, damaged beyond repair or permanently rendered unfit for use,
provided that Owner (or any Lessee), except as otherwise provided in
paragraph (c) of this Section 7.03, will, at its own cost and expense,
replace such Parts as promptly as practicable. All replacement Parts shall
be free and clear of all Liens (except for Permitted Liens and pooling
arrangements to the extent permitted by paragraph (b) of this Section 7.03
and except in the case of replacement property temporarily installed on an
emergency basis) and shall be in as good operating condition as, and shall
have a value and utility at least equal to, the Parts replaced assuming
such replaced Parts were in the condition and repair required to be
maintained by the terms hereof. Except as otherwise provided in paragraph
(c) of this Section 7.03, all Parts at any time removed from the Airframe
or any Engine shall remain the property of Owner, no matter where located.
Immediately upon any replacement part becoming incorporated or installed in
or attached to the Airframe or any Engine as above provided, without
further act (subject only to Permitted Liens and any pooling arrangement to
the extent permitted by paragraph (b) of this Section 7.03 and except in
the case of replacement property temporarily installed on an emergency
basis), such replacement Part shall become subject to the Lien of this
Indenture and be deemed part of the Airframe or such Engine for all
purposes hereof to the same extent as the Parts originally incorporated or
installed in or attached to the Airframe or such Engine, and the replaced
Part shall be free and clear of the Lien of this Indenture and shall no
longer be deemed a Part hereunder.
(b) Pooling of Parts. Any Part removed from the Airframe or
any Engine as provided in paragraph (a) of this Section 7.03 may be
subjected by Owner (or any Lessee) to a normal pooling arrangement
customary in the airline industry of which Owner (or, if a Lease is then in
effect, any Lessee) is a party entered into in the ordinary course of
Owner's (or any Lessee's) business; provided that the Part replacing such
removed Part shall be incorporated or installed in or attached to such
Airframe or Engine in accordance with such paragraph (a) as promptly as
practicable after the removal of such removed Part. In addition, any
replacement Part when incorporated or installed in or attached to the
Airframe or any Engine in accordance with such paragraph (a) may be owned
by any third party subject to such a normal pooling arrangement, provided
that Owner (or any Lessee), at its expense, as promptly thereafter as
practicable, either (i) causes title to such replacement Part to vest in
Owner in accordance with such paragraph (a) free and clear of all Liens
except Permitted Liens (other than pooling arrangements) or (ii) replaces
such replacement Part by incorporating or installing in or attaching to the
Airframe or Engine a further replacement Part owned by Owner (or any
Lessee) free and clear of all Liens except Permitted Liens (other than
pooling arrangements) and by causing title to such further replacement Part
to vest in Owner in accordance with such paragraph (a).
(c) Alterations, Modifications and Additions. Owner, at its
own expense, will make (or cause to be made) such alterations and
modifications in and additions to the Airframe and Engines as may be
required from time to time to meet the applicable standards of the FAA or
any applicable regulatory agency or body of any other jurisdiction in which
the Aircraft may then be registered as permitted by Section 7(b) of the
Participation Agreement; provided, however, that Owner (or, if a Lease is
then in effect, any Lessee) may, in good faith, contest the validity or
application of any such law, rule, regulation or order in any reasonable
manner which does not adversely affect the Indenture Trustee. In addition,
Owner (or any Lessee), at its own expense, may from time to time add
further parts or accessories and make such alterations and modifications in
and additions to the Airframe or any Engine as Owner (or any Lessee) may
deem desirable in the proper conduct of its business, including, without
limitation, removal of Parts which Owner (or any Lessee) has determined in
its reasonable judgment to be obsolete or no longer suitable or appropriate
for use on the Airframe or such Engine (such parts, "Obsolete Parts");
provided that no such alteration, modification or addition shall materially
diminish the value, utility or remaining useful life of the Airframe or
such Engine below the value, utility or remaining useful life thereof
immediately prior to such alteration, modification or addition (it being
agreed that the modification that makes an Engine a CFM 56-5B-5/P engine
shall be deemed not to diminish the value, utility and remaining useful
life of an Engine), assuming the Airframe or such Engine was then in the
condition required to be maintained by the terms of this Indenture, except
that the value (but not the utility or remaining useful life) of the
Airframe or any Engine may be reduced by the value of Obsolete Parts which
shall have been removed so long as the aggregate value of all Obsolete
Parts which shall have been removed and not replaced shall not exceed
$350,000 in aggregate value at the time of removal. Owner (or any Lessee)
may remove or suffer to be removed any Part incorporated or installed in or
attached or added to the Airframe or an Engine as the result of any such
alteration, modification or addition, provided that such additional Part
(i) is in addition to, and not in replacement of or substitution for, any
Part originally incorporated or installed in or attached to the Airframe or
any Engine at the time of delivery thereof hereunder or any Part in
replacement of, or substitution for, any such Part, (ii) is not required to
be incorporated or installed in or attached or added to the Airframe or any
Engine pursuant to the terms of Section 7.02 or the first sentence of this
paragraph (c) and (iii) can be removed from the Airframe or such Engine
without diminishing or impairing the value, utility or remaining useful
life which the Airframe or such Engine would have had at the time of
removal had such alteration, modification or addition not occurred.
Upon the removal by Owner (or Lessee) of any Part as
provided above, such Part shall no longer be deemed part of the Airframe or
Engine from which it was removed.
(d) Certain Matters Regarding Passenger Convenience
Equipment. Owner may install on the Airframe, subject to the requirements
of Section 7.03(c) above, Passenger Convenience Equipment that is (i) owned
by another Person and leased to Owner, (ii) sold to Owner by another Person
subject to a conditional sale contract or other retained security interest,
(iii) leased to Owner pursuant to a lease which is subject to a security
interest in favor of another Person or (iv) installed on the Aircraft
subject to a license granted to Owner by another Person, and in any such
case the Indenture Trustee will not acquire or claim, as against any such
other Person, any right, title or interest in any such Passenger
Convenience Equipment solely as a result of its installation on the
Airframe. Owner agrees that if any such Person repossesses such Passenger
Convenience Equipment, Owner will (or cause such Person to) restore the
Aircraft to the condition it would have been in had the installation of
such Passenger Convenience Equipment not occurred.
SECTION 7.04. Insurance.
(a) Owner's Obligation to Insure. Owner shall comply with,
or cause to be complied with, each of the provisions of Exhibit B, which
provisions are hereby incorporated by this reference as if set forth in
full herein.
(b) [Reserved.]
(c) Indemnification by Government in Lieu of Insurance.
Notwithstanding any provisions of this Section 7.04 requiring insurance,
the Indenture Trustee agrees to accept, in lieu of insurance against any
risk with respect to the Aircraft, indemnification from, or insurance
provided by, the United States Government or any agency or instrumentality
thereof, or, upon the written consent of the Indenture Trustee, other
government of registry of the Aircraft or agency or instrumentality
thereof, against such risk in an amount which, when added to the amount of
insurance against such risk maintained by Owner (or any Lessee) shall be at
least equal to the amount of insurance against such risk otherwise required
by this Section 7.04 (taking into account self-insurance permitted by
Exhibit B hereto).
(d) Application of Payments During Existence of an Event of
Default. Any amount referred to in paragraph (b) of Exhibit B which is
payable to or retainable by Owner (or any Lessee) shall not be paid to or
retained by Owner (or any Lessee) if at the time of such payment or
retention an Event of Default shall have occurred and be continuing, but
shall be held by or paid over to the Indenture Trustee as security for the
obligations of Owner hereunder if the Indenture Trustee declares this
Indenture to be in default pursuant to Section 4.02, applied against
Owner's obligations hereunder as and when due. At such time as there shall
not be continuing any such Event of Default, such amount shall be paid to
Owner to the extent not previously applied in accordance with the preceding
sentence.
SECTION 7.05. Inspection.
At all reasonable times and upon at least 15 days' prior
written notice to Owner, the Indenture Trustee, or its authorized
representatives, may inspect the Aircraft and inspect and make copies of
the books and records of Owner and any Lessee required to be maintained by
the FAA or the regulatory agency or body of another jurisdiction in which
the Aircraft is then registered relating to the maintenance of the Aircraft
(at the Indenture Trustee's risk and expense) and shall keep any
information or copies obtained thereby confidential and shall not disclose
the same to any Person, except (A) to the Note Holders and to prospective
and permitted transferees of the Note Holders' or the Indenture Trustee's
interest (and such prospective and permitted transferee's counsel,
independent insurance advisors or other agents) who agree to hold such
information confidential, (B) to the Note Holders' or the Indenture
Trustee's counsel, independent insurance advisors or other agents who agree
to hold such information confidential, or (C) as may be required by any
statute, court or administrative order or decree or governmental ruling or
regulation, provided, however, that any and all disclosures permitted by
clause (C) above shall be made only to the extent necessary to meet the
specific requirements or needs of the Persons for whom such disclosures are
hereby permitted. Any such inspection of the Aircraft shall be subject to
Owner's safety and security rules applicable to the location of the
Aircraft, shall be a visual, walk-around inspection of the interior and
exterior of the Aircraft and shall not include opening any panels, bays or
the like without the express consent of Owner (except in connection with a
heavy maintenance visit when a panel, bay or the like is scheduled or
required to be opened), which consent Owner may in its sole discretion
withhold; provided that no exercise of such inspection right shall
interfere with the normal operation or maintenance of the Aircraft by, or
the business of, Owner (or any Lessee). The Indenture Trustee shall not
have any duty to make any such inspection nor shall it incur any liability
or obligation by reason of not making such inspection. Except during the
continuance of an Event of Default, all inspections by the Indenture
Trustee and its authorized representatives provided for under this Section
7.05 shall be limited to one (1) inspection of any kind contemplated by
this Section 7.05 during any calendar year.
SECTION 7.06. Filings; Delivery of Financial Statements.
Forthwith upon the execution and delivery of each Indenture
Supplement from time to time required by the terms hereof and upon
execution and delivery of any amendment to this Indenture, Owner will cause
such Indenture Supplement (and, in the case of the initial Indenture
Supplement and the Indenture as well) or amendment to be duly filed and
recorded, and maintained of record, in accordance with the applicable laws
of the government of registry of the Aircraft. Owner agrees to furnish to
the Indenture Trustee promptly after execution and delivery of any
supplement and amendment hereto (except for any such supplement or
amendment which does not require or receive the approval of Owner pursuant
to the Operative Documents and is not required pursuant to the terms of the
Operative Documents), an opinion of counsel (which may be Owner's General
Counsel, Deputy General Counsel, Assistant General Counsel or Associate
General Counsel) reasonably satisfactory to the Indenture Trustee as to the
due recording or filing of such supplement or amendment. Owner will deliver
to the Indenture Trustee (a) within sixty (60) days after the end of each
of the first three quarterly periods of each fiscal year of Owner, the
publicly filed Form 10-Q report of Owner; and (b) within one hundred twenty
(120) days after the close of such fiscal year, the publicly filed annual
report and Form 10-K report of Owner.
ARTICLE VIII
INDEMNIFICATION OF INDENTURE TRUSTEE BY OWNER
SECTION 8.01. Scope of Indemnification.
Owner hereby agrees, except as otherwise provided in Section
2.04(b), to assume liability for, and does hereby indemnify, protect, save
and keep harmless the Indenture Trustee (in its individual and trust
capacities), and its successors, assigns, agents and servants, from 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, 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 (whether or not also indemnified against by
any other Person under any other document) in any way relating to or
arising out of this Indenture or any other Operative Document to which it
is a party 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,
non-acceptance, rejection, ownership, delivery, lease, possession, use,
operation, condition, sale, return or other disposition of the Aircraft or
any Engine (including, without limitation, latent or 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 Indenture Estate or the action or inaction of the
Indenture Trustee hereunder. Notwithstanding the foregoing, the Indenture
Trustee shall not be entitled to any indemnification for any Expenses to
the extent relating to or arising from the willful misconduct or gross
negligence (or negligence in the case of handling funds) of the Indenture
Trustee in the performance of its duties hereunder or resulting from the
inaccuracy of any representation or warranty of the Indenture Trustee (in
its individual capacity) referred to in Section 6.03, or as provided in
Section 6.01 or in the last sentence of Section 5.04, or as otherwise
excluded by the terms of Section 6(b) of the Participation Agreement from
Owner's indemnities under such Section. In addition, if necessary, the
Indenture Trustee shall be entitled to indemnification from the Indenture
Estate for any liability, obligation, loss, damage, penalty, claim, action,
suit, cost, expense or disbursement indemnified against pursuant to this
Section 8.01 to the extent not reimbursed by Owner or others, but without
releasing any of them from their respective agreements of reimbursement;
and to secure the same the Indenture Trustee shall have a prior Lien on the
Indenture Estate. Owner shall be subrogated to the Indenture Trustee's
rights, if any, to payment from Owner for amounts payable by the Owner
under this Section 8.01.
ARTICLE IX
SUCCESSOR AND SEPARATE TRUSTEES
SECTION 9.01. [Reserved.]
SECTION 9.02. Resignation 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 days' prior written
notice to Owner and each Note Holder, 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 (but only
with the consent of Owner, which consent shall not be unreasonably
withheld, except that such consent shall not be necessary if an Event of
Default shall have occurred and be continuing) remove the Indenture Trustee
without cause by an instrument in writing delivered to Owner 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 Indenture Trustee, a Majority in
Interest of Note Holders may appoint a successor Indenture Trustee by an
instrument signed by such holders, which successor, so long as no Event of
Default shall have occurred and be continuing, shall be subject to Owner's
reasonable approval. If a successor Indenture Trustee shall not have been
appointed within 30 days after such notice of resignation or removal, the
Indenture Trustee, Owner or any Note Holder 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.
(b) Any successor Indenture Trustee, however appointed,
shall execute and deliver to the predecessor Indenture Trustee and Owner an
instrument accepting such appointment and assuming the obligations of the
Indenture Trustee hereunder and under the Participation Agreement arising
from and after the time of such appointment, and thereupon such successor
Indenture Trustee, without further act, shall become vested with all the
estates, properties, rights, powers and duties of the predecessor Indenture
Trustee hereunder in the trust 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 monies or other property then held by such predecessor
Indenture Trustee hereunder.
(c) Any successor Indenture Trustee, however appointed,
shall be a bank or trust company having its principal place of business in
the United States and having (or whose obligations under the Operative
Documents are guaranteed by an affiliated entity having) a combined capital
and surplus of at least $100,000,000, 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, 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 9.02, be a successor Indenture Trustee and the Indenture Trustee
under this Indenture without further act.
SECTION 9.03. Appointment of Additional and Separate
Trustees.
(a) Whenever (i) the Indenture Trustee shall deem it
necessary or desirable in order to conform to any law of any jurisdiction
in which all or any part of the Indenture Estate shall be situated or to
make any claim or bring any suit with respect to or in connection with the
Indenture Estate, this Indenture, any other Indenture Agreement, the
Equipment Notes or any of the transactions contemplated by the
Participation Agreement, (ii) the Indenture Trustee shall be advised by
counsel satisfactory to it that it is so necessary or prudent in the
interests of the Note Holders (and the Indenture Trustee shall so advise
Owner), or (iii) the Indenture Trustee shall have been requested to do so
by a Majority in Interest of Note Holders, then in any such case, the
Indenture Trustee and, upon the written request of the Indenture Trustee,
Owner, shall execute and deliver an indenture supplemental hereto and such
other instruments as may from time to time be necessary or advisable either
(1) to constitute one or more bank or trust companies or one or more
Persons approved by the Indenture Trustee, either to act jointly with the
Indenture Trustee as additional trustee or trustees of all or any part of
the Indenture Estate, or to act as separate trustee or trustees of all or
any part of the Indenture Estate, in each case with such rights, powers,
duties and obligations consistent with this Indenture as may be provided in
such supplemental indenture or other instruments as the Indenture Trustee
or a Majority in Interest of Note Holders may deem necessary or advisable,
or (2) to clarify, add to or subtract from the rights, powers, duties and
obligations theretofore granted any such additional and separate trustee,
subject in each case to the remaining provisions of this Section 9.03. If
Owner shall not have taken any action requested of it under this Section
9.03(a) that is permitted or required by its terms within 15 days after the
receipt of a written request from the Indenture Trustee so to do, or if an
Event of Default shall have occurred and be continuing, the Indenture
Trustee may act under the foregoing provisions of this Section 9.03(a)
without the concurrence of Owner; and Owner hereby irrevocably appoints
(which appointment is coupled with an interest) the Indenture Trustee, its
agent and attorney-in-fact to act for it under the foregoing provisions of
this Section 9.03(a) in either of such contingencies. The Indenture Trustee
may, in such capacity, execute, deliver and perform any such supplemental
indenture, or any such instrument, as may be required for the appointment
of any such additional or separate trustee or for the clarification of,
addition to or subtraction from the rights, powers, duties or obligations
theretofore granted to any such additional or separate trustee. In case any
additional or separate trustee appointed under this Section 9.03(a) shall
die, become incapable of acting, resign or be removed, all the assets,
property, rights, powers, trusts, duties and obligations of such additional
or separate trustee shall revert to the Indenture Trustee until a successor
additional or separate trustee is appointed as provided in this Section
9.03(a).
(b) No additional or separate trustee shall be entitled to
exercise any of the rights, powers, duties and obligations conferred upon
the Indenture Trustee in respect of the custody, investment and payment of
monies and all monies received by any such additional or separate trustee
from or constituting part of the Indenture Estate or otherwise payable
under any Operative Document to the Indenture Trustee shall be promptly
paid over by it to the Indenture Trustee. All other rights, powers, duties
and obligations conferred or imposed upon any additional or separate
trustee shall be exercised or performed by the Indenture Trustee and such
additional or separate trustee jointly except to the extent that applicable
Law of any jurisdiction in which any particular act is to be performed
renders the Indenture Trustee incompetent or unqualified to perform such
act, in which event such rights, powers, duties and obligations (including
the holding of title to all or part of the Indenture Estate in any such
jurisdiction) shall be exercised and performed by such additional or
separate trustee. No additional or separate trustee shall take any
discretionary action except on the instructions of the Indenture Trustee or
a Majority in Interest of Note Holders. No trustee hereunder shall be
personally liable by reason of any act or omission of any other trustee
hereunder, except that the Indenture Trustee shall be liable for the
consequences of its lack of reasonable care in selecting, and Indenture
Trustee's own actions in acting with, any additional or separate trustee.
Each additional or separate trustee appointed pursuant to this Section 9.03
shall be subject to, and shall have the benefit of Articles IV through IX
and Article XI insofar as they apply to the Indenture Trustee. The powers
of any additional or separate trustee appointed pursuant to this Section
9.03 shall not in any case exceed those of the Indenture Trustee hereunder.
(c) If at any time the Indenture Trustee shall deem it no
longer necessary or desirable in order to conform to any such law or take
any such action or shall be advised by such counsel that it is no longer so
necessary or desirable in the interest of the Note Holders, or in the event
that the Indenture Trustee shall have been requested to do so in writing by
a Majority in Interest of Note Holders, the Indenture Trustee and, upon the
written request of the Indenture Trustee, Owner, shall execute and deliver
an indenture supplemental hereto and all other instruments and agreements
necessary or proper to remove any additional or separate trustee. The
Indenture Trustee may act on behalf of Owner under this Section 9.03(c)
when and to the extent it could so act under Section 9.03(a).
ARTICLE X
SUPPLEMENTS AND AMENDMENTS TO THIS INDENTURE
AND OTHER DOCUMENTS
SECTION 10.01. Instructions of Majority; Limitations.
(a) Owner agrees it shall not enter into any amendment of or
supplement to Article 12 of the Purchase Agreement (to the extent assigned
by the Purchase Agreement Assignment), the Purchase Agreement Assignment,
the Consent and Agreement, or execute and deliver any written waiver or
modification of, or consent under, the Purchase Agreement (to the extent
assigned by the Purchase Agreement Assignment), the Purchase Agreement
Assignment, the Consent and Agreement, unless such supplement, amendment,
waiver, modification or consent is consented to in writing by the Indenture
Trustee and a Majority in Interest of Note Holders.
(b) Without limiting the provisions of Section 10.01(a) 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 Purchase Agreement (to the extent assigned by the Purchase
Agreement Assignment), the Purchase Agreement Assignment, the Consent and
Agreement or the Participation Agreement, or any other agreement included
in the 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 effect the Note Holders,
but 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 Owner or, as may be appropriate, the Manufacturer;
provided, however, that, without the consent of each holder of an affected
Equipment Note then outstanding, no such amendment of or supplement to this
Indenture, the Purchase Agreement (to the extent assigned by the Purchase
Agreement Assignment), the Purchase Agreement Assignment, the Consent and
Agreement or the Participation Agreement or waiver or modification of the
terms of, or consent under, any thereof, shall (i) modify any of the
provisions of this Section 10.01, or of Sections 2.02, 2.10, 2.11, 2.15,
4.02, 4.04(c), 4.04(d), 5.02 or 5.06, the definitions of "Event of
Default", "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 with
respect to the order of priorities in which distribution thereunder shall
be made as among the Note Holders and Owner, (iii) reduce, modify or amend
any indemnities in favor of the Note Holders, (iv) consent to any change in
the Indenture which would permit redemption of Equipment Notes earlier than
permitted under Section 2.10 or 2.11 or the purchase of the Equipment Notes
or (v) permit the creation of any Lien on the 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 Indenture Estate, except as
provided in connection with the exercise of remedies under Article IV.
Without the consent of Owner, no amendment or supplement to this Indenture
or waiver or modification of the terms hereof shall adversely affect Owner.
(c) At any time after the date hereof, Owner 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 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 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; (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 Owner for the benefit of
the Note Holders, or to surrender any rights or power herein conferred upon
Owner; (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.
SECTION 10.02. Trustees Protected.
If, in the opinion of the institution acting as Indenture
Trustee hereunder, any document required to be executed by it pursuant to
the terms of Section 10.01 adversely affects 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 10.03. Documents Mailed to Note Holders.
Promptly after the execution by the Owner or the Indenture
Trustee of any document entered into pursuant to Section 10.01, the
Indenture Trustee shall mail, by first class mail, postage prepaid, a copy
thereof to Owner and to each Note Holder at its address last set forth in
the Equipment Note Register, but the failure of the Indenture Trustee to
mail such copies shall not impair or affect the validity of such document.
SECTION 10.04. No Request Necessary for Indenture Supplement.
No written request or consent of the Indenture Trustee or
the Note Holders pursuant to Section 10.01 shall be required to enable
Owner to enter into any Indenture Supplement specifically required by the
terms hereof.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Termination of Indenture.
Upon (or at any time after) payment in full of the Principal
Amount of, Make-Whole Amount, if any, and interest on and all other amounts
due under all Equipment Notes and provided that there shall then be no
other Secured Obligations due to the Note Holders, the Indenture
Indemnitees and the Indenture Trustee hereunder or under the Participation
Agreement, Owner shall direct the Indenture Trustee to execute and deliver
to or as directed in writing by Owner an appropriate instrument releasing
the Aircraft, the Engines, the Purchase Agreement and the Purchase
Agreement Assignment with the Consent and Agreement attached thereto from
the Lien of this Indenture and the Indenture Trustee shall execute and
deliver such instrument as aforesaid and give written notice thereof to
Owner; provided, however, that this Indenture and the trusts created hereby
shall earlier terminate and this Indenture shall be of no further force or
effect upon any sale or other final disposition by the Indenture Trustee of
all property constituting part of the Indenture Estate and the final
distribution by the Indenture Trustee of all monies or other property or
proceeds constituting part of the 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 11.02. No Legal Title to Indenture Estate in Note
Holders.
No holder of an Equipment Note shall have legal title to any
part of the 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 Indenture Estate or hereunder shall operate to
terminate this Indenture or entitle such holder or any successor or
transferee of such holder to an accounting or to the transfer to it of any
legal title to any part of the Indenture Estate.
SECTION 11.03. Sale of Aircraft by Indenture Trustee
Is Binding.
Any sale or other conveyance of the Indenture Estate, or any
part thereof (including any part thereof or interest therein), by the
Indenture Trustee made pursuant to the terms of this Indenture shall bind
the Note Holders and shall be effective to transfer or convey all right,
title and interest of the Indenture Trustee, Owner and such holders in and
to such Indenture Estate or part thereof. 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 11.04. Indenture for Benefit of Owner, Indenture
Trustee, Note Holders and the Other Indenture Indemnitees.
Nothing in this Indenture, whether express or implied, shall
be construed to give any person other than Owner, the Indenture Trustee,
the Indenture Indemnitees and the Note Holders, any legal or equitable
right, remedy or claim under or in respect of this Indenture.
SECTION 11.05. Notices.
Unless otherwise expressly specified or permitted by the
terms hereof, all notices, requests, demands, authorizations, directions,
consents, waivers or documents provided or permitted by this Indenture to
be made, given, furnished or filed shall be in writing, personally
delivered or mailed by certified mail, postage prepaid, or by facsimile or
confirmed telex, and (i) if to Owner, addressed to it at its office at 2345
Crystal Drive, Arlington, Virginia 22227, Attention: Vice President and
Treasurer, Telecopy No.: (703) 872-5936, (ii) if to the Indenture Trustee,
addressed to it at its office at 225 Asylum Street, Goodwin Square,
Hartford, Connecticut 06103, Attention: Corporate Trust Administration,
Telecopy No.: (860) 244-1889, (iii) if to any Participant or any Note
Holder, addressed to such party at such address as such party shall have
furnished by notice to the Owner 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 Participation Agreement or in the
Equipment Note Register. Whenever any notice in writing is required to be
given by Owner, any Participant, the Indenture Trustee or any Note Holder
to any of the other of them, such notice shall be deemed given and such
requirement satisfied when such notice is received, or if such notice is
mailed by certified mail, postage prepaid, three Business Days after being
mailed, addressed as provided above. 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 11.06. 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. Any such prohibition or
unenforceability in any particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 11.07. No Oral Modification or Continuing Waivers.
No term or provision of this Indenture or the Equipment
Notes may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by Owner and the Indenture Trustee, in
compliance with Section 10.01. 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 11.08. 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 permitted successors and 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 holder.
Each Note Holder by its acceptance of an Equipment Note agrees to be bound
by this Indenture and all provisions of the Participation Agreement
applicable to a Loan Participant or a Note Holder.
SECTION 11.09. Headings.
The headings of the various Articles and Sections herein and
in the table of contents hereto are for convenience of reference only and
shall not define or limit any
of the terms or provisions hereof.
SECTION 11.10. Normal Commercial Relations.
Anything contained in this Indenture to the contrary
notwithstanding, the Indenture Trustee, any Participant or any bank or
other Affiliate of such Participant may conduct any banking or other
financial transactions, and have banking or other commercial relationships,
with Owner, 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 Owner for any purpose whatsoever, whether related
to any of the transactions contemplated hereby or otherwise.
SECTION 11.11. Governing Law; Counterpart Form.
THIS INDENTURE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND
SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE. THIS INDENTURE IS BEING DELIVERED
IN THE STATE OF NEW YORK. This Indenture may be executed by the parties
hereto in separate counterparts (or upon separate signature pages bound
together into one or more 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 11.12. Voting By Note Holders.
All votes of the Note Holders shall be governed by a vote of
a Majority in Interest of Note Holders, except as otherwise provided
herein.
SECTION 11.13. Bankruptcy.
It is the intention of the parties that the Indenture
Trustee 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 in the event of a case under Chapter 11 of the
Bankruptcy Code in which Owner is a debtor, and in any instance where more
than one construction is possible of the terms and conditions hereof or 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.
SECTION 11.14. References.
Unless otherwise specified, references in this Indenture to
Sections, Exhibits, Schedules and Annexes are references to Sections,
Exhibits, Schedules and Annexes herein or hereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed by their respective officers thereof duly
authorized as of the day and year first above written.
US AIRWAYS, INC.
By:_______________________________
Name:
Title:
STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as Indenture
Trustee
By:_______________________________
Name:
Title:
================================
EXHIBIT A
TO
INDENTURE AND SECURITY AGREEMENT
================================
INDENTURE SUPPLEMENT
(No. N___U_)
This Indenture Supplement N___U_) dated _______ __, _____
(herein called this "Indenture Supplement") of US Airways, Inc.
W I T N E S S E T H:
WHEREAS, the Indenture and Security Agreement N___U_) dated
as of _________ __, ____ (as amended and supplemented to the date hereof,
the "Indenture") between Owner and STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, 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, and shall specifically mortgage such Aircraft to the Indenture
Trustee; and
WHEREAS, 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 FAA as one document;
NOW, THEREFORE, this Indenture Supplement witnesseth that
Owner hereby confirms that the Lien of the Indenture on the Indenture
Estate covers all of Owner's right, title and interest in and to the
following described property:
<TABLE>
<CAPTION>
AIRFRAME
One airframe identified as follows:
FAA Registration Manufacturer's
Manufacturer Model Number Number Serial Number
- -------------------- -------------------- -------------------- --------------------
<S> <C> <C> <C>
Airbus A3__
</TABLE>
together with all of Owner's right, title and interest in and to all Parts
of whatever nature, whether now owned or hereinafter acquired and which are
from time to time incorporated or installed in or attached to said
airframe.
AIRCRAFT ENGINES
Two aircraft engines, each such engine having 750 or more
rated take-off horsepower or the equivalent thereof, identified as follows:
Manufacturer's
Manufacturer Model Number Serial Number
- ------------------------ -------------------------- --------------------
together with all of Owner's right, title and interest in and to all Parts
of whatever nature, whether now owned or hereafter acquired and which are
from time to time incorporated or installed in or attached to any of such
engines.
Together with all of Owner's right, title and interest in
and to all Parts of whatever nature, which from time to time are included
within the definition of "Airframe" or "Engine", whether now owned or
hereafter acquired, including all substitutions, renewals and replacements
of and additions, improvements, accessions and accumulations to the
Airframe and Engines (other than additions, improvements, accessions and
accumulations which constitute appliances, parts, instruments,
appurtenances, accessories, furnishings or other equipment excluded from
the definition of Parts).
TO HAVE AND TO HOLD all and singular the aforesaid property
unto the Indenture Trustee, its successors and assigns, in trust for the
equal and proportionate benefit and security of the Note Holders, except as
provided in Section 2.15 and Article III of the Indenture without any
preference, distinction or priority of any one Equipment Note over any
other by reason of priority of time of issue, sale, negotiation, date of
maturity thereof or otherwise for any reason whatsoever, and for the uses
and purposes and subject to the terms and provisions set forth in the
Indenture.
This Indenture Supplement shall be construed as supplemental
to the Indenture and shall form a part thereof. The Indenture is each
hereby incorporated by reference herein and is hereby ratified, approved
and confirmed. Capitalized terms used but not otherwise defined herein
shall have the meanings set forth in the Indenture.
This Indenture Supplement is being delivered in the State of
New York.
AND, FURTHER, Owner hereby acknowledges that the Aircraft
referred to in this Indenture Supplement has been delivered to Owner and is
included in the property of Owner, subject to the pledge and mortgage
thereof under the Indenture.
IN WITNESS WHEREOF, Owner has caused this Indenture
Supplement to be duly executed by one of its officers, thereunto duly
authorized, on the day and year
first above written.
US AIRWAYS, INC.
By:_______________________________
Name:
Title:
================================
EXHIBIT B
TO
INDENTURE AND SECURITY AGREEMENT
================================
INSURANCE
The portion of this Exhibit appearing below this text will be
intentionally deleted from the FAA filing counterpart as the parties hereto
deem it to contain confidential
information.
(a) Public Liability and Property Damage Insurance. (1)
Except as provided in clause (2) of this subsection (a), and subject to
self-insurance to the extent permitted by subsection (d) of this Exhibit B,
Owner will carry or cause to be carried with respect to the Aircraft at its
or any Lessee's expense (i) comprehensive airline liability (including,
without limitation, passenger, contractual, bodily injury and property
damage liability) insurance (exclusive of manufacturer's product liability
insurance) and (ii) cargo liability insurance, (A) in an amount not less
than the greater of (x) the amounts of comprehensive airline liability
insurance from time to time applicable to aircraft owned or leased, and
operated by Owner (or, if a Lease is then in effect, by Lessee) of the same
type as the Aircraft and (y) $300 million per occurrence, (B) of the type
and covering the same risks as from time to time applicable to aircraft
owned or leased and operated by Owner of the same type as the Aircraft, and
(C) which is maintained in effect with insurers of nationally or
internationally recognized reputation and responsibility; provided,
however, that Owner need not maintain such cargo liability insurance, or
may maintain such cargo liability insurance in an amount less than $300
million per occurrence, so long as the amount of cargo liability insurance,
if any, maintained with respect to the Aircraft is not less than the cargo
liability insurance, if any, maintained for other Airbus Model A___
aircraft owned or leased and operated by Owner.
(2) During any period that the Airframe or an Engine, as the
case may be, is on the ground and not in operation, Owner may carry or
cause to be carried as to such non-operating property, in lieu of the
insurance required by clause (1) above, and subject to the self-insurance
to the extent permitted by subsection (d), insurance by insurers of
nationally or internationally recognized reputation and responsibility
otherwise conforming with the provisions of said clause (1) except that (A)
the amounts of coverage shall not be required to exceed the amounts of
comprehensive airline liability from time to time applicable to property
owned or leased by Owner of the same type as such non-operating property
and which is on the ground and not in operation; and (B) the scope of the
risks covered and the type of insurance shall be the same as from time to
time shall be applicable to aircraft owned or leased by Owner of the same
type as such non-operating property and which is on the ground and not in
operation.
(b) Insurance Against Loss or Damage to the Aircraft. (1)
Except as provided in clause (2) of this subsection (b), and subject to the
provisions of subsection (d) of this Exhibit B permitting the
self-insurance, Owner shall maintain or cause to be maintained in effect,
at its or any Lessee's expense, with insurers of nationally or
internationally recognized responsibility, all-risk aircraft hull insurance
covering the Aircraft and fire and extended coverage and all-risk aircraft
hull insurance covering Engines and Parts while temporarily removed from
the Aircraft and not replaced by similar components; provided that such
insurance shall at all times while the Aircraft is subject to the Lien of
the Indenture be for an amount (taking into account the self-insurance to
the extent permitted by subsection (d) of this Exhibit B) not less than the
amount payable under Section 5.06(a) upon the occurrence of an Event of
Loss; provided further, that, subject to compliance with subsection (d) of
this Exhibit B, such all-risk property damage insurance covering Engines
and Parts temporarily removed from an Airframe or an airframe or (in the
case of Parts) an Engine need be obtained only to the extent available at
reasonable cost (as reasonably determined by Owner). In the case of a loss
with respect to an engine (other than an Engine) installed on the airframe
in circumstances which do not constitute an Event of Loss with respect to
the Airframe, the Indenture Trustee shall promptly remit any payment made
to it of any insurance proceeds in respect of such loss to Owner or any
other third party that is entitled to receive such proceeds.
Unless an Event of Default has occurred and is continuing,
all losses will be adjusted by Owner with the insurers. As between the
Indenture Trustee and Owner, it is agreed that all insurance payments
received as the result of the occurrence of an Event of Loss will be
applied as follows:
(x) if such payments are received with respect to the
Airframe (or the Airframe and the Engines installed
thereon), (i) unless such property is replaced pursuant to
the last paragraph of Section 5.06(a), so much of such
payments remaining, after reimbursement of the Indenture
Trustee for reasonable costs and expenses, as shall not
exceed the amounts payable pursuant to Section 5.06(a),
shall be paid over to, or retained by, the Indenture Trustee
for the benefit of the Note Holders (but not in excess of
the amounts then due and payable under the Equipment Notes);
or (ii) if such property is replaced pursuant to the last
paragraph of Section 5.06(a), such payments shall be paid
over to, or retained by, Owner (or if directed by Owner, any
Lessee), provided that Owner shall have fully performed or,
concurrently therewith, will fully perform the terms of the
last paragraph of Section 5.06(a) with respect to the Event
of Loss for which such payments are made; and
(y) if such payments are received with respect to an
Engine under the circumstances contemplated by Section
5.06(b), so much of such payments remaining after
reimbursement of the Indenture Trustee for reasonable costs
and expenses, shall be paid over to, or retained by, Owner
(or if directed by Owner, any Lessee), provided that Owner
shall have fully performed or concurrently therewith will
fully perform the terms of Section 5.06(b) with respect to
the Event of Loss for which such payments are made.
As between the Indenture Trustee and Owner, the insurance
payments for any property damage loss to the Airframe or any engine not
constituting an Event of Loss with respect thereto will be applied in
payment for repairs or for replacement property in accordance with the
terms of Sections 7.02 and 7.03, if not already paid for by Owner (or any
Lessee), and any balance (or if already paid for by Owner (or any Lessee),
all such insurance proceeds) remaining after compliance with such Sections
with respect to such loss shall be paid to Owner (or any Lessee if directed
by Owner).
(2) During any period that the Aircraft is on the ground and
not in operation, Owner may carry or cause to be carried, in lieu of the
insurance required by clause (1) above, and subject to self-insurance to
the extent permitted by subsection (d) of this Exhibit B, insurance
otherwise conforming with the provisions of said clause (1) except that the
scope of the risks and the type of insurance shall be the same as from time
to time applicable to aircraft owned or leased by Owner (or, if a Lease is
then in effect, by Lessee) of the same type as the Aircraft similarly on
the ground and not in operation, provided that, subject to self-insurance
to the extent permitted by subsection (d) of this Exhibit B, Owner shall
maintain insurance against risk of loss or damage to the Aircraft in an
amount at least equal to the amount payable upon the occurrence of an Event
of Loss pursuant to Section 5.06(a) during such period that the Aircraft is
on the ground and not in operation.
(3) If Owner (or any Lessee) shall at any time operate or
propose to operate the Aircraft, Airframe or any Engine (i) in any area of
recognized hostilities or (ii) on international routes, and war-risk,
hijacking or allied perils insurance is maintained by Owner (or any Lessee)
with respect to other aircraft owned and operated by Owner (or any Lessee)
on such routes or in such areas, Owner shall maintain or cause to be
maintained war-risk, hijacking and related perils insurance of
substantially the same type carried by major United States commercial air
carriers operating the same or comparable models of aircraft on similar
routes or in such areas and in no event in an amount less than the amount
payable upon the occurrence of an Event of Loss pursuant to Section
5.06(a).
(c) Reports, etc. Owner will furnish, or cause to be
furnished, to the Indenture Trustee and the Pass Through Trustee, on or
before the Delivery Date and on each annual anniversary date of Owner's
applicable insurance, a report, signed by Owner's regular insurance broker
or any other independent firm of insurance brokers reasonably acceptable to
the Indenture Trustee which brokers may be in the regular employ of Owner
(the "Insurance Brokers"), describing in reasonable detail the hull and
liability insurance (and property insurance for detached engines and parts)
then carried and maintained with respect to the Aircraft and stating the
opinion of such firm that the insurance complies with the terms hereof;
provided, that all information contained in the foregoing report shall not
be made available by the Indenture Trustee or the Pass Through Trustee to
anyone except (i) to prospective and permitted transferees of the Indenture
Trustee's or the Pass Through Trustee's interest or their respective
counsel, independent certified public accountants and independent insurance
brokers or other agents, who agree to hold such information confidential,
(ii) the Indenture Trustee's or the Pass Through Trustee's counsel or
independent certified public accountants, independent insurance brokers or
agents who agree to hold such information confidential or (iii) as may be
required by any statute, court or administrative order or decree or
governmental ruling or regulation; provided, however that any disclosure
permitted by clause (iii) above shall be made only to the extent necessary
to meet the specific requirements or needs of the Persons to whom such
disclosures are hereby permitted. Owner will cause such Insurance Brokers
to agree to advise the Indenture and the Pass Through Trustee in writing of
any act or omission on the part of Owner of which it has knowledge and
which might invalidate or render unenforceable, in whole or in part, any
insurance on the Aircraft and to advise in writing at least thirty (30)
days (ten (10) days in the case of war risk, allied perils coverage and
with respect to the Electronic Date Recognition Exclusion Limited Coverage
Endorsement), prior to the cancellation or material adverse change of any
insurance maintained pursuant to Section 7.04, provided that if the notice
period specified above is not reasonably obtainable, the Insurance Broker
shall provide for as long a period of prior notice as shall then be
reasonably obtainable. In addition, Owner will also cause such Insurance
Brokers to deliver to the Indenture Trustee and the Pass Through Trustee,
on or prior to the date of expiration of any insurance policy referenced in
a previously delivered certificate of insurance, a new certificate of
insurance, substantially in the same form as delivered by Owner to such
parties on the Delivery Date except for such changes in the report or the
coverage consistent with the terms hereof. In the event that Owner or any
Lessee shall fail to maintain or cause to be maintained insurance as herein
provided, the Indenture Trustee may at its sole option, but shall be under
no duty to, provide such insurance and, in such event, Owner shall, upon
demand, reimburse the Indenture Trustee for the cost thereof to the
Indenture Trustee.
(d) Self-Insurance. Owner may self-insure by way of
deductible, premium adjustment or franchise provisions or otherwise
(including, with respect to insurance maintained pursuant to subsection (b)
of this Exhibit B, insuring for an amount that is less than the amounts
payable upon the occurrence of an Event of Loss pursuant to Section
5.06(a)) the risks required to be insured against pursuant to Section 7.04
under a program applicable to all aircraft (whether owned or leased) in
Owner's fleet, but in no case shall the aggregate amount of self-insurance
in regard to subsection (a) and (b) of this Exhibit B exceed for any policy
year, with respect to all of the aircraft (whether owned or leased) in
Owner's fleet (including, without limitation, the Aircraft), the lesser of
(i) 50% of the highest replacement value of any single aircraft in Owner's
fleet or (ii) 1-1/2% of the average aggregate insurable value (during the
preceding policy year) of all aircraft (including, without limitation, the
Aircraft) on which Owner carries insurance, unless an insurance broker of
national standing shall certify that the standard among all other major
United States airlines is a higher level of self-insurance, in which case
Owner may insure the Aircraft to such higher level. In addition to the
foregoing right to self-insure, Owner (and any Lessee) may self-insure to
the extent of any applicable mandatory minimum per aircraft (or, if
applicable, per annum or other period) hull or liability insurance
deductible customary in the airline industry imposed by the aircraft hull
or liability insurer.
(e) Terms of Policies. Any policies of insurance carried in
accordance with subsection (a) or (b) of this Exhibit B and any policies
taken out in substitution or replacement for any of such policies (A) shall
be amended to name the Additional Insureds as their respective interests
may appear, (B) may provide for the self-insurance to the extent permitted
in subsection (d) of this Exhibit B, (C) shall provide that if the insurers
cancel such insurance for any reason whatever or if any material change is
made in such insurance which adversely affects the interest of the
Additional Insureds, or such insurance shall lapse for non-payment of
premium, such cancellation, lapse or change shall not be effective as to
the Additional Insureds for thirty (30) days (ten (10) days in the case of
war risk, allied perils coverage and with respect to the Electronic Date
Recognition Limited Coverage Endorsement) after issuance to the Additional
Insureds, respectively, of written notice by such insurers of such
cancellation, lapse or change; provided, however, that if any notice period
specified above is not reasonably obtainable, such policies shall provide
for as long a period of prior notice as shall then be reasonably
obtainable, (D) shall provide that in respect of the respective interests
of the Additional Insureds in such policies the insurance shall not be
invalidated by any action or inaction of Owner (or, if any Lease is then in
effect, any Lessee) or any other Person and shall insure the Additional
Insureds regardless of any breach or violation of any warranty, declaration
or condition contained in such policies by Owner (or, if any Lease is then
in effect, any Lessee), (E) shall be primary without right of contribution
from any other insurance which is carried by any Additional Insured, (F)
shall expressly provide that all of the provisions thereof, except the
limits of liability, shall operate in the same manner as if there were a
separate policy covering each insured, (G) shall waive any right of the
insurers to any set-off or counterclaim or any other deduction, whether by
attachment or otherwise, in respect of any liability of any Additional
Insured to the extent of any moneys due to any Additional Insured, and (H)
shall provide that (i) in the event of a loss involving proceeds in excess
of $5,000,000, the proceeds in respect of such loss up to an amount equal
to the amount payable upon the occurrence of an Event of Loss pursuant to
Section 5.06(a) shall be payable to the Indenture Trustee (so long as the
Indenture shall not have been discharged) in the manner set forth in
Sections 2.10 and 2.12 (except in the case of a loss with respect to an
Engine installed on an airframe other than the Airframe, in which case
Owner (or any Lessee) shall arrange for any payment of insurance proceeds
in respect of such loss to be held for the account of the Indenture Trustee
(so long as the Indenture shall not have been discharged) whether such
payment is made to Owner (or any Lessee) or any third party), it being
understood and agreed that in the case of any payment to the Indenture
Trustee otherwise than in respect of an Event of Loss, the Indenture
Trustee shall, upon receipt of evidence satisfactory to it that the damage
giving rise to such payment shall have been repaired or that such payment
shall then be required to pay for repairs then being made, pay the amount
of such payment (and all earnings thereon) to Owner or its order, and (ii)
the entire amount of any loss involving proceeds of $5,000,000 or less or
the amount of any proceeds of any loss in excess of the amount payable upon
the occurrence of an Event of Loss pursuant to Section 5.06(a) shall be
paid to Owner or its order unless an Event of Default shall have occurred
and be continuing and the insurers have been notified thereof by the
Indenture Trustee.
================================
EXHIBIT C
TO
INDENTURE AND SECURITY AGREEMENT
================================
SCHEDULE OF DOMICILES OF PERMITTED LESSEES
Australia Malta
Austria Mexico
Bahamas Netherlands
Belgium New Zealand
Bermuda Norway
Brazil People's Republic of China
Canada Philippines
Denmark Portugal
Finland Republic of China (Taiwan)*
France Singapore
Germany South Korea
Grenada Spain
Greece Sweden
Iceland Switzerland
India Thailand
Ireland Tobago
Italy Trinidad
Jamaica Turkey
Japan United Kingdom
Luxembourg United States
Malaysia Venezuela
*So long as on the date of the Sublease such country and the
United States have diplomatic relations at least as good as those in effect
on the Delivery Date.
SCHEDULE I
Principal Amount Interest Rate
------------------- ------------------- ------------------
Series A 8.36%
Series B 9.01%
Series C 7.96%
SCHEDULE II
PASS THROUGH TRUST AGREEMENT AND
PASS THROUGH TRUST SUPPLEMENTS
Pass Through Trust Agreement, dated as of July 30, 1999, between US
Airways, Inc., US Airways Group, Inc. and State Street Bank and Trust
Company of Connecticut, National Association, as supplemented by Trust
Supplement No. 1999-1A, dated as of August 31, 1999, as supplemented by
Trust Supplement No. 1999-1B, dated as of August 31, 1999, as supplemented
by Trust Supplement No. 1999-1C, dated as of August 31, 1999.
Exhibit 4(a)(xxii)
FORM OF PURCHASE AGREEMENT ASSIGNMENT
(OWNED AIRCRAFT)
PURCHASE AGREEMENT ASSIGNMENT
(N___U_)
PURCHASE AGREEMENT ASSIGNMENT (N___U_), dated as of
_____________ __, ____, between US AIRWAYS, INC., a Delaware corporation
("Assignor"), and STATE STREET BANK AND TRUST COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, a national banking association, not in its
individual capacity but solely as Indenture Trustee ("Assignee") under the
Indenture and Security Agreement (N___U_), dated as of _____________ __,
____, (as amended, modified or supplemented from time to time, the
"Indenture"), between Assignor and Assignee.
W I T N E S S E T H :
WHEREAS, US Airways Group, Inc. ("Parent") and AVSA (as
hereinafter defined) are parties to the Purchase Agreement (as hereinafter
defined), providing, among other things, for the delivery by AVSA to
Parent of certain aircraft, including the Aircraft (as hereinafter
defined) covered by the Participation Agreement (as hereinafter defined);
and
WHEREAS, pursuant to a Purchase Agreement Assignment, dated as
of __________ __, 1999, by and between Parent and Assignor (the "Parent
Assignment"), Parent assigned all of its right, title in and interest in
and to the Purchase Agreement to Assignor to the extent such right, title
and interest relate to certain aircraft, including the Aircraft covered by
the Participation Agreement;
WHEREAS, pursuant to a Consent and Agreement of AVSA and
Guarantor (as hereinafter defined), dated as of ________ __, 1999 (the
"Parent Consent and Agreement"), AVSA and Guarantor consented to the
assignment by Parent to Assignor of Parent's right, title in and interest
in and to the Purchase Agreement as provided for in the Parent Assignment;
WHEREAS, pursuant to the Parent Consent and Agreement, Guarantor
confirmed that its guarantee given in the Consent and Guaranty (as
hereinafter defined) remains in full force and effect and, to the extent
the same relates to the aircraft assigned to the Assignor pursuant to the
Parent Assignment, it inures to the benefit of the Assignor;
WHEREAS, pursuant to the Consent and Guaranty, Guarantor has
agreed, among other things, to unconditionally guarantee the due and
punctual performance by AVSA of all of its liabilities and obligations as
set forth in the Purchase Agreement; and
WHEREAS, on the terms and conditions hereof and of the Consents
and Agreements (as hereinafter defined), Assignor desires to assign to
Assignee certain of the Assignor's remaining rights, title and interests
in, to and under the Purchase Agreement and the Consent and Guaranty as
security for the Secured Obligations (insofar as such obligations relate
to the Purchase Agreement and the Aircraft) and Assignee is willing to
accept such collateral assignment, as hereinafter set forth; and
WHEREAS, such assignments and acceptances are intended to permit
consummation of the transactions contemplated by the Participation
Agreement; and
WHEREAS, AVSA and Guarantor are willing to execute and deliver
their respective Consents and Agreements;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
1. Defined Terms. For all purposes of this Assignment, except as
otherwise expressly provided or unless the context otherwise requires, the
following terms shall have the following meanings:
"Aircraft" shall mean the Airbus A3__ aircraft, bearing
manufacturer's serial number ___, delivered under the Purchase Agreement,
including the two [CFM International Model 56-5] (1) [Pratt & Whitney
Model _____](2) engines installed on such aircraft on the date of delivery
thereof pursuant to the Purchase Agreement.
- -------------------
(1) For A319 and A320 Aircraft.
(2) For A330 Aircraft.
"AVSA" shall mean AVSA, S.A.R.L., a French societe a
responsabilite limitee, and its successors and assigns.
"AVSA Consent and Agreement" shall mean the Consent and
Agreement of AVSA attached hereto, as amended, modified or supplemented
from time to time.
"Consent and Guaranty" shall mean the Consent and Guaranty of
the Guarantor attached to the Purchase Agreement, together with all
amendments, waivers, and consents heretofore entered into or heretofore
granted thereunder.
"Consents and Agreements" shall mean the AVSA Consent and
Agreement and the Guarantor Consent and Agreement.
"Equipment Notes" shall have the meaning ascribed thereto in the
Participation Agreement.
"Guarantor" shall mean Airbus Industrie G.I.E., a French
groupement d'interet economique, and its successors and assigns.
"Guarantor Consent and Agreement" shall mean the Consent and
Agreement of the Guarantor attached hereto, as amended, modified or
supplemented from time to time.
"Participation Agreement" shall mean the Participation Agreement
(N___U_), dated as of _____________ __, ____, between the Assignor and the
Assignee, as amended, modified or supplemented from time to time.
"Purchase Agreement" shall mean the [Airbus A319/A320/A321
Purchase Agreement, dated as of October 31, 1997, between US Airways
Group, Inc. and AVSA] (3) [Airbus A330/A340 Purchase Agreement, dated as
of November 24, 1998, between US Airways Group, Inc. and AVSA] (4),
together with all exhibits, appendices and letter agreements thereto and
all amendments, waivers and consents granted thereunder.
- -------------------
(3) For A319 and A320 Aircraft.
(4) For A330 Aircraft.
All other terms used herein in capitalized form that are defined
in the Participation Agreement shall, when used herein, have the meanings
specified in the Participation Agreement.
2. Assignment. (a) Generally. To secure performance of the
Secured Obligations, Assignor has assigned, transferred and set over and
does hereby sell, assign, transfer and set over unto the Assignee a first
priority security interest and mortgage in, to and under (i) all of the
Assignor's right, title and interest in and to (x) Clauses 12, 13 and 17
of the Purchase Agreement (the "Assigned Rights") and (y) the Consent and
Guaranty (insofar as such Consent and Guaranty relates to the Assigned
Rights), as and to the extent that the same relates to the Aircraft,
except to the extent reserved below, including, without limitation, in
such assignment to Assignee (A) all claims for damages in respect of such
Aircraft arising as a result of any default by AVSA under Clause 12, 13 or
17 of the Purchase Agreement, including, without limitation, all warranty,
service life policy and indemnity provisions contained in Clause 12 of the
Purchase Agreement in respect of the Aircraft and all claims thereunder
and under the Consent and Guaranty in respect of the Aircraft and (B) any
and all rights of Assignor to compel performance of the terms of Clause
12, 13 and 17 of the Purchase Agreement and the Consent and Guaranty in
respect of the Aircraft; reserving to the Assignor, however, all
Assignor's rights and interests in and to Clauses 12, 13 and 17 of the
Purchase Agreement and the Consent and Guaranty as and to the extent that
Clause 12, 13 or 17 of the Purchase Agreement and the Consent and Guaranty
relate to aircraft other than the Aircraft and to the extent that the
Purchase Agreement and the Consent and Guaranty relate to any other
matters not directly pertaining to the Aircraft.
(b) Assignment of Rights. If and so long as there shall not
exist and be continuing an Event of Default and, if an Event of Default is
continuing, so long as Assignor remains in possession of the Aircraft,
Assignee hereby authorizes Assignor, to the exclusion of Assignee, to
exercise in Assignor's name all rights and powers related to the Assigned
Rights and to retain any recovery or benefit resulting from the
enforcement of any of the Assigned Rights in respect of the Aircraft,
except that Assignor may not enter into any change order or other
amendment, modification or supplement to the Purchase Agreement without
the written consent or countersignature of Assignee if such change order,
amendment, modification or supplement would result in any rescission,
cancellation or termination of the Assigned Rights in respect of the
Aircraft or in any way limit the rights assigned hereunder.
(c) Acceptance of Assignment. Subject to the terms hereof,
Assignee accepts the assignment contained in this Clause 2.
(d) Onward Transfer of Rights. Except as provided in Clause 8
hereunder, Assignee agrees that it may not sell, assign or otherwise
transfer any of the Assigned Rights without the prior written consent of
AVSA.
(e) Requirement of Notice to AVSA. For all purposes of this
Assignment, AVSA shall not be deemed to have knowledge of and need not
recognize any Event of Default, unless and until AVSA shall have received
written notice thereof from Assignee addressed to its Chief Executive
Officer, 2, Rond Point Maurice Bellonte, 31700 Blagnac, France (telex
521155F) (fax: 011-33-5-6130-4011) and, in acting in accordance with the
terms of the Purchase Agreement and this Assignment, AVSA may act with
acquittance and conclusively rely upon any such notice.
3. Certain Rights and Obligations of the Parties. (a) Assignor
Remains Liable. It is expressly agreed that, anything herein contained to
the contrary notwithstanding: (a) Assignor shall at all times remain
liable to AVSA under the Purchase Agreement to perform all the duties and
obligations of the "Buyer" thereunder to the same extent as if this
Assignment had not been executed; (b) the exercise by Assignee of any of
the rights assigned hereunder shall not release Assignor from any of its
duties or obligations to AVSA under the Purchase Agreement except to the
extent that such exercise by Assignee shall constitute performance of such
duties and obligations; and (c) except as provided in the next succeeding
paragraph, neither Assignee nor any Loan Participant shall have any
obligation or liability under the Purchase Agreement by reason of, or
arising out of, this Assignment or be obligated to perform any of the
obligations or duties of Assignor under the Purchase Agreement or to make
any payment or to make any inquiry as to the sufficiency of any payment
received by any of them or to present or file any claim or to take any
other action to collect or enforce any claim for any payment assigned
hereunder.
(b) Assignee Bound by Purchase Agreement. Without in any way
releasing Assignor from any of its duties or obligations under the
Purchase Agreement, Assignee confirms for the benefit of AVSA that,
insofar as the provisions of the Purchase Agreement relate to the
Aircraft, in exercising any rights under the Purchase Agreement, or in
making any claim with respect to the Aircraft or other goods and services
delivered or to be delivered pursuant to the Purchase Agreement, the terms
and conditions of the Purchase Agreement disclosed to Assignee in writing
shall apply to, and be binding upon, Assignee to the extent of its
respective interests assigned hereunder to the same extent as Assignor.
(c) Limit of Effect of this Assignment. Nothing contained herein
shall (i) subject AVSA or the Guarantor to any liability to which it would
not otherwise be subject under the Purchase Agreement or (ii) modify in
any respect the contractual rights of AVSA or the Guarantor thereunder
(except, in each case, as provided in the attached Consents and
Agreements).
(d) Appointment as Attorney-in-Fact. Assignor does hereby
constitute, effective at any time after an Event of Default shall have
occurred and be continuing, Assignee and its successors and permitted
assigns to be Assignor's true and lawful attorney, irrevocably, with full
power (in the name of Assignor or otherwise) to ask, require, demand,
receive, compound and give acquittance for any and all monies and claims
for monies due and to become due under, or arising out of, the Purchase
Agreement and the Consent and Guaranty in respect of the Aircraft, to the
extent that the same have been assigned as provided in this Assignment
and, for such period as Assignee, its successors and assigns may exercise
rights with respect thereto under this Assignment, to endorse any checks
or other instruments or orders in connection therewith and to file any
claims or take any action or institute (or, if previously commenced,
assume control of) any proceedings and to obtain any recovery in
connection therewith which Assignee, its successors and assigns, may deem
to be necessary or advisable in the premises.
4. Further Assurances. Assignor and Assignee each agree that, at
any time and from time to time, upon the written request of any other
party hereto, it will promptly and duly execute and deliver any and all
such further instruments and documents and take such further action as the
other may reasonably request in order to obtain the full benefits of this
Assignment and of the rights and powers herein granted.
5. No Amendment of Purchase Agreement. Assignee agrees that it
shall not enter into any agreement that would amend, modify, supplement,
rescind, cancel or terminate the Purchase Agreement or the Consent and
Guaranty in any respect or in any way limit the rights of Assignor or any
of the other rights assigned hereunder (except as set forth above when
there has been an Event of Default), without the prior written consent of
Assignor.
6. Execution of Assignment. This Assignment is executed by
Assignor and Assignee concurrently with the execution and delivery of the
Participation Agreement.
7. Confidentiality. Assignee agrees that it will not disclose to
any third party the terms of the Purchase Agreement or this Assignment,
except (a) as required by applicable law or governmental regulation, (b)
as contemplated in the Participation Agreement (including as set forth in
Section 7(o) of the Participation Agreement) or (c) with the consent of
Assignor, Guarantor and AVSA.
8. Counterparts. This Assignment 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.
9. GOVERNING LAW. THIS ASSIGNMENT SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
10. Successors and Assigns. This Assignment shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
11. Notices. All notices with respect to the matters contained
herein shall be delivered (notices with respect to AVSA shall be sent to
the address for AVSA set forth in clause 2(d)) in the manner provided in
Section 12(a) of the Participation Agreement.
12. No Oral Amendments. Neither this Assignment nor any of the
terms hereof may be terminated, amended, supplemented, waived or modified
orally, but only by an instrument in writing signed by the party against
whom the enforcement of such termination, amendment, supplement, waiver or
modification is sought.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment to be duly executed as of the day and year first above written.
US AIRWAYS, INC.
By: _________________________________
Name:
Title:
` STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION, not
in its individual capacity but solely as Indenture
Trustee
By: ________________________________
Name:
Title:
AIRBUS INDUSTRIE CONSENT AND AGREEMENT
The undersigned, Airbus Industrie G.I.E., a groupement d'interet
economique established under Ordonnance No. 67-821 dated September 23,
1967 of the Republic of France ("Guarantor"), hereby acknowledges notice
of and consents to all of the terms of the Purchase Agreement Assignment
between US Airways, Inc., a Delaware corporation ("Assignor"), and State
Street Bank and Trust Company of Connecticut, National Association, a
national banking association, not in its individual capacity but solely as
Indenture Trustee ( "Assignee") under the Indenture and Security Agreement
(N___U_), dated as of ______________ (hereinafter called the "Assignment",
the defined terms therein being hereinafter used with the same meaning),
and to the assignment of the Assigned Rights to Assignee under the
Indenture, dated as of ______________, between Assignor and Assignee
(hereinafter called the "Indenture"), and hereby confirms to Assignor and
Assignee and their respective successors and assigns that:
(i) except as provided in the Assignment, all representations,
warranties, and agreements of Guarantor under the Consent and
Guaranty insofar as they relate to the Assigned Rights with respect
to the Aircraft shall inure to the benefit of Assignee and its
respective successors and permitted assigns, to the same extent as if
Assignee and its successors and permitted assigns had originally been
named the "Buyer" of the Aircraft therein;
(ii) Guarantor will pay to the person or entity entitled to receive
the corresponding payment from AVSA under the terms of the Assignment
all amounts required to be paid by Guarantor with respect to the
Aircraft;
(iii) Guarantor consents to the assignment of Assignor's rights and
interests under the Purchase Agreement and the Consent and Guaranty
to Assignee pursuant to the Assignment; and
(iv) from and after the purchase of the Aircraft pursuant to the
Participation Agreement and payment in full for the Aircraft,
Guarantor will not assert any lien or claim against the Aircraft or
any part thereof or against Assignor or Assignee arising on or prior
to such purchase or in respect of any work or services performed on
or prior thereto.
Guarantor hereby represents and warrants that:
(A) Guarantor is a groupement d'interet economique duly
organized and existing in good standing under the laws of the Republic of
France and has the requisite power and authority to enter into and perform
its obligations under the Consent and Guaranty and this Consent and
Agreement;
(B) the making and performance, in accordance with their terms
of the Consent and Guaranty and this Consent and Agreement have been duly
authorized by all necessary corporate action on the part of Guarantor, do
not require the consent or approval of the members of Guarantor, do not
require the consent or approval of,or the giving of notice to, or
registration with, or the taking of any other action in respect of, any
French governmental authority or agency except for those that have already
been obtained and do not contravene any law binding on Guarantor or
contravene Guarantor's charter documents or any indenture, credit
agreement or other contractual agreement to which Guarantor is a party or
by which it is bound;
(C) the Consent and Guaranty constituted, as of the date thereof
and at all times thereafter to and including the date of this Consent and
Agreement, and each of this Consent and Agreement and the Consent and
Guaranty constitutes, binding obligations of Guarantor enforceable against
Guarantor in accordance with their respective terms, subject to: (i) the
limitations of applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of creditors generally;
and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), which
principles do not make the remedies available at law or in equity with
respect to the Purchase Agreement and this Consent and Agreement
inadequate for the practical realization of the benefits intended to be
provided thereby; and
(D) the Consent and Guaranty is in full force and effect.
This Consent and Agreement is made subject to and with the
benefit of Clause 3 of the Assignment and Section 4.03 of the Indenture.
* * * * * *
THIS CONSENT AND AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE.
Dated as of ________________
AIRBUS INDUSTRIE G.I.E.
By: _______________________________
Name:
Title:
AVSA CONSENT AND AGREEMENT
The undersigned, AVSA, S.A.R.L., a societe a responsabilite
limitee organized and existing under the laws of the Republic of France
("AVSA"), hereby acknowledges notice of and consents to all of the terms
of the Purchase Agreement Assignment between US Airways, Inc., a Delaware
corporation ("Assignor"), and State Street Bank and Trust Company of
Connecticut, National Association, a national banking association, not in
its individual capacity but solely as Indenture Trustee (the "Assignee")
under the Indenture and Security Agreement (N___U_), dated as of
______________ (hereinafter called the "Assignment", the defined terms
therein being hereinafter used with the same meaning), and to the
assignment of the Assigned Rights to the Assignee under the Indenture,
dated as of ______________, between the Assignor and the Assignee
(hereinafter called the "Indenture"), and hereby confirms to Assignor and
Assignee and their respective successors and assigns that:
(i) except as provided in the Assignment, all representations,
warranties, indemnities and agreements of AVSA under the Purchase
Agreement insofar as they relate to the Assigned Rights with respect
to the Aircraft shall inure to the benefit of Assignee and its
respective successors and permitted assigns to the same extent as if
Assignee and its successors and permitted assigns had originally been
named the "Buyer" of the Aircraft therein;
(ii) AVSA will pay to Assignor all payments required to be paid by it
under the Purchase Agreement, unless and until AVSA shall have
received written notice from Assignee addressed to it at the address
and in the manner set forth in the Assignment that an Event of
Default has occurred and is continuing, whereupon AVSA will make any
and all payments thereafter required to be made by it under the
Purchase Agreement, to the extent that the right to receive such
payment has been assigned under the Assignment ("AVSA Payments"),
directly to Assignee if AVSA shall have received notice as aforesaid
that an Event of Default has occurred and is continuing;
(iii) Assignee shall not be liable for any of the obligations or
duties of Assignor under the Purchase Agreement, nor shall the
Assignment give rise to any duties or obligations whatsoever on the
part of Assignee owing to AVSA, except for the agreements of Assignee
set forth in the Assignment, including, but not limited to clause
3(b) of the Assignment;
(iv) AVSA consents to the assignment of Assignor's rights and
interests under the Purchase Agreement and the Consent and Guaranty
to Assignee pursuant to the Assignment; and
(v) from and after the purchase of the Aircraft pursuant to the
Participation Agreement and payment in full for the Aircraft, AVSA
will not assert any lien or claim against the Aircraft or any part
thereof arising on or prior to such purchase or in respect of any
work or services performed on or prior thereto.
AVSA hereby represents and warrants that:
(A) AVSA is a societe a responsabilite limitee duly organized
and existing in good standing under the laws of the Republic of France and
has the requisite power and authority to enter into and perform its
obligations under the Purchase Agreement and this Consent and Agreement;
(B) the making and performance, in accordance with their terms,
of the Purchase Agreement and this Consent and Agreement have been duly
authorized by all necessary corporate action on the part of AVSA, do not
require any approval of AVSA's shareholders, do not require the consent or
approval of, the giving notice to, or registration with, or the taking of
any other action in respect of, any French governmental authority or
agency except for those that have already been obtained and do not
contravene any law binding on AVSA or contravene AVSA's charter documents
or any indenture, credit agreement or other contractual agreement to which
AVSA is a party or by which it is bound;
(C) each of the Purchase Agreement and this Consent and
Agreement constitutes a binding obligation of AVSA enforceable against
AVSA in accordance with its terms, subject to: (i) the limitations of
applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the rights of creditors generally; and (ii) general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), which principles do not
make the remedies available at law or in equity with respect to the
Purchase Agreement and this Consent and Agreement inadequate for the
practical realization of the benefits intended to be provided thereby; and
(D) the Purchase Agreement is in full force and effect as to
AVSA.
This Consent and Agreement is made subject to and with the
benefit of Clause 3 of the Assignment and Section 4.03 of the Indenture.
* * * * * *
THIS CONSENT AND AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE.
Dated as of ________________
AVSA, S.A.R.L.
By: ________________________________
Name:
Title:
Exhibit 4(a)(xxiii)
Indenture N___U__
(FORM OF OWNED AIRCRAFT FRENCH PLEDGE AGREEMENT)
FRENCH PLEDGE AGREEMENT
THIS PLEDGE is made on this ___ day of __________,_____ (this "Pledge")
BETWEEN:
(1) US Airways, Inc., a Delaware corporation having its principal
place of business at 2345 Crystal Drive, Arlington, Virginia
22227 U.S.A. (hereinafter referred to as the "Pledgor"); and
(2) State Street Bank and Trust Company of Connecticut, National
Association, a national banking association having its
principal place of business at 225 Asylum Street, Goodwin
Square, Hartford, Connecticut 06103 U.S.A., acting not in its
individual capacity but solely as Indenture Trustee under the
Indenture (hereinafter referred to as the "Pledgee").
RECITALS
(A) Pursuant to the terms of the Indenture, the Pledgor has, inter
alia, assigned to the Pledgee by way of collateral security
certain of its right, interest, claims and demands in and to
the Secured Documents (as hereinafter defined).
(B) The Pledgor and the Pledgee wish to create a pledge under
French law of the right, interest, claims and demands of the
Pledgor in and to the Secured Documents.
NOW THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:
1. DEFINITIONS
Capitalized terms used herein without definition have the
respective meanings ascribed to them in the Indenture (whether set
out therein or incorporated by reference).
"Indenture Documents" means the Indenture, the Participation
Agreement and the Equipment Notes.
"Indenture" means the Indenture and Security Agreement, dated as of
___________ ___, ____ and made between the Pledgor and the Pledgee.
"Secured Documents" means the Purchase Agreement Assignment and the
Consent and Agreement.
2. PLEDGE
In order to assure the due performance by the Pledgor of the
Secured Obligations and in order to secure the payment of all
amounts due and owing by the Pledgor in connection therewith
(whether of principal, interest or other amounts), the Pledgor
hereby grants and pledges to the Pledgee, all of the Pledgor's
right, title and interest in and to the Secured Documents and to
all payments or proceeds to be received by the Pledgor and all
rights of the Pledgor to enforce such payments under all of the
Secured Documents.
It is understood that this Pledge is granted as security for the
payment of:
(i) the principal amount of US$[ ] payable with respect to [ ];
(ii) interest on the outstanding amount at the rate of [ ]%;
(iii) all other amounts payable by the Pledgor to the Pledgee
under the Indenture Documents; and
(iv) any expenses incurred in the enforcement of the payment
obligations and recovery of the sums payable under the
Indenture Documents.
3. NOTIFICATION
The Pledgor shall, in accordance with Article 2075 of the French
Civil Code, register a French translation of this Pledge with the
relevant French tax authorities ("recette des impOts") and shall
give notice thereof by huissier to AVSA, S.A.R.L. and Airbus
Industrie G.I.E..
4. GOVERNING LAW
The Pledge is of a commercial nature and shall be governed by and
construed in accordance with French law.
IN WITNESS WHEREOF, the parties hereto have caused this Pledge to
be duly executed as of the day and year first above written.
US AIRWAYS, INC.
By: _________________________________
Name:
Title:
` STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL ASSOCIATION,
not in its individual capacity but solely as
Indenture Trustee
By: ________________________________
Name:
Title:
Exhibit 4(a)(xxiv)
CUSIP No. 90332U AE 3
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch the
registered owner hereof, Cede & Co., has an interest herein.
US AIRWAYS PASS THROUGH TRUST 1999-1A
8.36% US Airways Pass Through Certificate, Series 1999-1A
Issuance Date: August 31, 1999
Final Expected Distribution Date: January 20, 2019
Evidencing A Fractional Undivided Interest In The US Airways Pass
Through Trust 1999-1A, The Property Of Which Includes Certain
Equipment Notes Each Secured By An Aircraft Leased To Or Owned By
US Airways, Inc.
Certificate
No. 1 $200,000,000 Fractional Undivided Interest representing
0.000259818% of the Trust per $1,000 face amount
THIS CERTIFIES THAT Cede & Co., for value received, is the
registered owner of a $200,000,000 (Two Hundred Million Dollars) Fractional
Undivided Interest in the US Airways Pass Through Trust 1999-1A (the
"Trust") created by State Street Bank and Trust Company of Connecticut,
National Association, as trustee (the "Trustee"), pursuant to a Pass
Through Trust Agreement, dated as of July 30, 1999 (the "Basic Agreement"),
between the Trustee, US Airways, Inc., a Delaware corporation (the
"Company") and US Airways Group, Inc., a Delaware corporation, as
supplemented by Trust Supplement No. 1999-1A thereto, dated as of August
31, 1999 (the "Trust Supplement" and, together with the Basic Agreement,
the "Agreement"), between the Trustee and the Company, a summary of certain
of the pertinent provisions of which is set forth below. To the extent not
otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Agreement. This Certificate is one of the
duly authorized Certificates designated as "8.36% US Airways Pass Through
Certificates, Series 1999-1A" (herein called the "Certificates"). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement. By virtue of its acceptance hereof, the
Certificateholder of this Certificate assents to and agrees to be bound by
the provisions of the Agreement and the Intercreditor Agreement. The
property of the Trust includes certain Equipment Notes and all rights of
the Trust to receive payments under the Intercreditor Agreement and any
Liquidity Facility (the "Trust Property"). Each issue of the Equipment
Notes is secured by, among other things, a security interest in an Aircraft
leased to or owned by the Company.
The Certificates represent Fractional Undivided Interests in
the Trust and the Trust Property and have no rights, benefits or interest
in respect of any other separate trust established pursuant to the terms of
the Basic Agreement for any other series of certificates issued pursuant
thereto.
Subject to and in accordance with the terms of the Agreement
and the Intercreditor Agreement, from funds then available to the Trustee,
there will be distributed on each January 20 and July 20 (a "Regular
Distribution Date") commencing January 20, 2000, to the Person in whose
name this Certificate is registered at the close of business on the 15th
day preceding the Regular Distribution Date, an amount in respect of the
Scheduled Payments on the Equipment Notes due on such Regular Distribution
Date, the receipt of which has been confirmed by the Trustee, equal to the
product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Scheduled Payments.
Subject to and in accordance with the terms of the Agreement and the
Intercreditor Agreement, in the event that Special Payments on the
Equipment Notes are received by the Trustee, from funds then available to
the Trustee, there shall be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Special Payments so
received. If a Regular Distribution Date or Special Distribution Date is
not a Business Day, distribution shall be made on the immediately following
Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the
Trustee by check mailed to the Person entitled thereto, without
presentation or surrender of this Certificate or the making of any notation
hereon, except that with respect to Certificates registered on the Record
Date in the name of a Clearing Agency (or its nominee), such distribution
shall be made by wire transfer. Except as otherwise provided in the
Agreement and notwithstanding the above, the final distribution on this
Certificate will be made after notice mailed by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such
notice.
The Certificates do not represent a direct obligation of, or
an obligation guaranteed by, or an interest in, the Company or the Trustee
or any affiliate thereof. The Certificates are limited in right or payment,
all as more specifically set forth on the face hereof and in the Agreement.
All payments or distributions made to Certificateholders under the
Agreement shall be made only from the Trust Property and only to the extent
that the Trustee shall have sufficient income or proceeds from the Trust
Property to make such payments in accordance with the terms of the
Agreement. Each Certificateholder of this Certificate, by its acceptance
hereof, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement
for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by
any Certificateholder upon request.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Certificateholders under
the Agreement at any time by the Company and the Trustee with the consent
of the Certificateholders holding Certificates evidencing Fractional
Undivided Interests aggregating not less than a majority in interest in the
Trust. Any such consent by the Certificateholder of this Certificate shall
be conclusive and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without
the consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations set forth therein, the transfer of this Certificate is
registrable in the Register upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by the
Trustee in its capacity as Registrar, or by any successor Registrar, duly
endorsed or accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Registrar, duly executed by the
Certificateholder hereof or such Certificateholder's attorney duly
authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same aggregate Fractional Undivided
Interest in the Trust will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered
Certificates without coupons in minimum denominations of $1,000 Fractional
Undivided Interest and integral multiples thereof except that one
Certificate may be issued in a different denomination. As provided in the
Agreement and subject to certain limitations therein set forth, the
Certificates are exchangeable for new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest
in the Trust, as requested by the Certificateholder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee shall require payment of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
Each Certificateholder and Investor, by its acceptance of
this Certificate or a beneficial interest herein, agrees to treat the Trust
as a grantor trust for all U.S. federal, state and local income tax
purposes.
The Trustee, the Registrar, and any agent of the Trustee or
the Registrar may treat the person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Trustee,
the Registrar, nor any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the
Agreement and the Trust created thereby shall terminate upon the
distribution to Certificateholders of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property.
Any Person acquiring or accepting this Certificate or an
interest herein will, by such acquisition or acceptance, be deemed to have
represented and warranted that either: (i) the assets of an employee
benefit plan subject to Title I of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or of a plan subject to Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code"), have not been
used to purchase this Certificate or an interest herein or (ii) the
purchase and holding of this Certificate or interest herein are exempt from
the prohibited transaction restrictions of ERISA and the Code pursuant to
one or more prohibited transaction statutory or administration exemptions.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been
executed by the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate
to be duly executed.
US AIRWAYS PASS THROUGH TRUST 1999-1A
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as Trustee
By: /s/ John G. Correia
________________________________________
Name: John G. Correia
Title:Assistant Secretary
THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as Trustee
By: /s/ John G. Correia
_______________________________________
Name: John G. Correia
Title:Assistant Secretary
Dated: August 31, 1999
CUSIP No. 90332U AE 3
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch the
registered owner hereof, Cede & Co., has an interest herein.
US AIRWAYS PASS THROUGH TRUST 1999-1A
8.36% US Airways Pass Through Certificate, Series 1999-1A
Issuance Date: August 31, 1999
Final Expected Distribution Date: January 20, 2019
Evidencing A Fractional Undivided Interest In The US Airways Pass
Through Trust 1999-1A, The Property Of Which Includes Certain
Equipment Notes Each Secured By An Aircraft Leased To Or Owned By
US Airways, Inc.
Certificate
No. 2 $184,884,000 Fractional Undivided Interest representing
0.000259818% of the Trust per $1,000 face amount
THIS CERTIFIES THAT Cede & Co., for value received, is the
registered owner of a $184,884,000 (One Hundred Eighty Four Million Eight
Hundred Eighty Four Thousand Dollars) Fractional Undivided Interest in the
US Airways Pass Through Trust 1999-1A (the "Trust") created by State Street
Bank and Trust Company of Connecticut, National Association, as trustee
(the "Trustee"), pursuant to a Pass Through Trust Agreement, dated as of
July 30, 1999 (the "Basic Agreement"), between the Trustee, US Airways,
Inc., a Delaware corporation (the "Company") and US Airways Group, Inc., a
Delaware corporation, as supplemented by Trust Supplement No. 1998-1A
thereto, dated as of August 31, 1999 (the "Trust Supplement" and, together
with the Basic Agreement, the "Agreement"), between the Trustee and the
Company, a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized
terms used herein have the meanings assigned to them in the Agreement. This
Certificate is one of the duly authorized Certificates designated as "8.36%
US Airways Pass Through Certificates, Series 1999-1A" (herein called the
"Certificates"). This Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement. By virtue of its
acceptance hereof, the Certificateholder of this Certificate assents to and
agrees to be bound by the provisions of the Agreement and the Intercreditor
Agreement. The property of the Trust includes certain Equipment Notes and
all rights of the Trust to receive payments under the Intercreditor
Agreement and any Liquidity Facility (the "Trust Property"). Each issue of
the Equipment Notes is secured by, among other things, a security interest
in an Aircraft leased to or owned by the Company.
The Certificates represent Fractional Undivided Interests in
the Trust and the Trust Property and have no rights, benefits or interest
in respect of any other separate trust established pursuant to the terms of
the Basic Agreement for any other series of certificates issued pursuant
thereto.
Subject to and in accordance with the terms of the Agreement
and the Intercreditor Agreement, from funds then available to the Trustee,
there will be distributed on each January 20 and July 20 (a "Regular
Distribution Date") commencing January 20, 2000, to the Person in whose
name this Certificate is registered at the close of business on the 15th
day preceding the Regular Distribution Date, an amount in respect of the
Scheduled Payments on the Equipment Notes due on such Regular Distribution
Date, the receipt of which has been confirmed by the Trustee, equal to the
product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Scheduled Payments.
Subject to and in accordance with the terms of the Agreement and the
Intercreditor Agreement, in the event that Special Payments on the
Equipment Notes are received by the Trustee, from funds then available to
the Trustee, there shall be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Special Payments so
received. If a Regular Distribution Date or Special Distribution Date is
not a Business Day, distribution shall be made on the immediately following
Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the
Trustee by check mailed to the Person entitled thereto, without
presentation or surrender of this Certificate or the making of any notation
hereon, except that with respect to Certificates registered on the Record
Date in the name of a Clearing Agency (or its nominee), such distribution
shall be made by wire transfer. Except as otherwise provided in the
Agreement and notwithstanding the above, the final distribution on this
Certificate will be made after notice mailed by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such
notice.
The Certificates do not represent a direct obligation of, or
an obligation guaranteed by, or an interest in, the Company or the Trustee
or any affiliate thereof. The Certificates are limited in right or payment,
all as more specifically set forth on the face hereof and in the Agreement.
All payments or distributions made to Certificateholders under the
Agreement shall be made only from the Trust Property and only to the extent
that the Trustee shall have sufficient income or proceeds from the Trust
Property to make such payments in accordance with the terms of the
Agreement. Each Certificateholder of this Certificate, by its acceptance
hereof, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement
for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by
any Certificateholder upon request.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Certificateholders under
the Agreement at any time by the Company and the Trustee with the consent
of the Certificateholders holding Certificates evidencing Fractional
Undivided Interests aggregating not less than a majority in interest in the
Trust. Any such consent by the Certificateholder of this Certificate shall
be conclusive and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without
the consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations set forth therein, the transfer of this Certificate is
registrable in the Register upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by the
Trustee in its capacity as Registrar, or by any successor Registrar, duly
endorsed or accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Registrar, duly executed by the
Certificateholder hereof or such Certificateholder's attorney duly
authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same aggregate Fractional Undivided
Interest in the Trust will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered
Certificates without coupons in minimum denominations of $1,000 Fractional
Undivided Interest and integral multiples thereof except that one
Certificate may be issued in a different denomination. As provided in the
Agreement and subject to certain limitations therein set forth, the
Certificates are exchangeable for new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest
in the Trust, as requested by the Certificateholder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee shall require payment of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
Each Certificateholder and Investor, by its acceptance of
this Certificate or a beneficial interest herein, agrees to treat the Trust
as a grantor trust for all U.S. federal, state and local income tax
purposes.
The Trustee, the Registrar, and any agent of the Trustee or
the Registrar may treat the person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Trustee,
the Registrar, nor any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the
Agreement and the Trust created thereby shall terminate upon the
distribution to Certificateholders of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property.
Any Person acquiring or accepting this Certificate or an
interest herein will, by such acquisition or acceptance, be deemed to have
represented and warranted that either: (i) the assets of an employee
benefit plan subject to Title I of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or of a plan subject to Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code"), have not been
used to purchase this Certificate or an interest herein or (ii) the
purchase and holding of this Certificate or interest herein are exempt from
the prohibited transaction restrictions of ERISA and the Code pursuant to
one or more prohibited transaction statutory or administration exemptions.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been
executed by the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate
to be duly executed.
US AIRWAYS PASS THROUGH TRUST 1999-1A
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as Trustee
By: /s/ John G. Correia
_________________________________________
Name: John G. Correia
Title:Assistant Secretary
THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as Trustee
By: /s/ John G. Correia
________________________________________
Name: John G. Correia
Title:Assistant Secretary
Dated: August 31, 1999
Exhibit 4(a)(xxv)
CUSIP No. 90332U AF 0
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch the
registered owner hereof, Cede & Co., has an interest herein.
US AIRWAYS PASS THROUGH TRUST 1999-1B
9.01% US Airways Pass Through Certificate, Series 1999-1B
Issuance Date: August 31, 1999
Final Expected Distribution Date: January 20, 2019
Evidencing A Fractional Undivided Interest In The US Airways
Pass Through Trust 1999-1B, The Property Of Which Includes
Certain Equipment Notes Each Secured By An Aircraft Leased
To Or Owned By US Airways, Inc.
Certificate
No. 1 $83,384,000 Fractional Undivided Interest representing
0.001199271% of the Trust per $1,000 face amount
THIS CERTIFIES THAT Cede & Co., for value received, is the
registered owner of a $83,384,000 (Eighty Three Million Three Hundred
Eighty Four Thousand Dollars) Fractional Undivided Interest in the US
Airways Pass Through Trust 1999-1B (the "Trust") created by State Street
Bank and Trust Company of Connecticut, National Association, as trustee
(the "Trustee"), pursuant to a Pass Through Trust Agreement, dated as of
July 30, 1999 (the "Basic Agreement"), between the Trustee, US Airways,
Inc., a Delaware corporation (the "Company") and US Airways Group, Inc., a
Delaware corporation, as supplemented by Trust Supplement No. 1999-1B
thereto, dated as of August 31, 1999 (the "Trust Supplement" and, together
with the Basic Agreement, the "Agreement"), between the Trustee and the
Company, a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized
terms used herein have the meanings assigned to them in the Agreement. This
Certificate is one of the duly authorized Certificates designated as "9.01%
US Airways Pass Through Certificates, Series 1999-1B" (herein called the
"Certificates"). This Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement. By virtue of its
acceptance hereof, the Certificateholder of this Certificate assents to and
agrees to be bound by the provisions of the Agreement and the Intercreditor
Agreement. The property of the Trust includes certain Equipment Notes and
all rights of the Trust to receive payments under the Intercreditor
Agreement and any Liquidity Facility (the "Trust Property"). Each issue of
the Equipment Notes is secured by, among other things, a security interest
in an Aircraft leased to or owned by the Company.
The Certificates represent Fractional Undivided Interests in
the Trust and the Trust Property and have no rights, benefits or interest
in respect of any other separate trust established pursuant to the terms of
the Basic Agreement for any other series of certificates issued pursuant
thereto.
Subject to and in accordance with the terms of the Agreement
and the Intercreditor Agreement, from funds then available to the Trustee,
there will be distributed on each January 20 and July 20 (a "Regular
Distribution Date") commencing January 20, 2000 to the Person in whose name
this Certificate is registered at the close of business on the 15th day
preceding the Regular Distribution Date, an amount in respect of the
Scheduled Payments on the Equipment Notes due on such Regular Distribution
Date, the receipt of which has been confirmed by the Trustee, equal to the
product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Scheduled Payments.
Subject to and in accordance with the terms of the Agreement and the
Intercreditor Agreement, in the event that Special Payments on the
Equipment Notes are received by the Trustee, from funds then available to
the Trustee, there shall be distributed on the applicable Special
Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee,
equal to the product of the percentage interest in the Trust evidenced by
this Certificate and an amount equal to the sum of such Special Payments so
received. If a Regular Distribution Date or Special Distribution Date is
not a Business Day, distribution shall be made on the immediately following
Business Day with the same force and effect as if made on such Regular
Distribution Date or Special Distribution Date and no interest shall accrue
during the intervening period. The Trustee shall mail notice of each
Special Payment and the Special Distribution Date therefor to the
Certificateholder of this Certificate.
Distributions on this Certificate will be made by the
Trustee by check mailed to the Person entitled thereto, without
presentation or surrender of this Certificate or the making of any notation
hereon, except that with respect to Certificates registered on the Record
Date in the name of a Clearing Agency (or its nominee), such distribution
shall be made by wire transfer. Except as otherwise provided in the
Agreement and notwithstanding the above, the final distribution on this
Certificate will be made after notice mailed by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency of the Trustee specified in such
notice.
The Certificates do not represent a direct obligation of, or
an obligation guaranteed by, or an interest in, the Company or the Trustee
or any affiliate thereof. The Certificates are limited in right or payment,
all as more specifically set forth on the face hereof and in the Agreement.
All payments or distributions made to Certificateholders under the
Agreement shall be made only from the Trust Property and only to the extent
that the Trustee shall have sufficient income or proceeds from the Trust
Property to make such payments in accordance with the terms of the
Agreement. Each Certificateholder of this Certificate, by its acceptance
hereof, agrees that it will look solely to the income and proceeds from the
Trust Property to the extent available for distribution to such
Certificateholder as provided in the Agreement. This Certificate does not
purport to summarize the Agreement and reference is made to the Agreement
for information with respect to the interests, rights, benefits,
obligations, proceeds, and duties evidenced hereby. A copy of the Agreement
may be examined during normal business hours at the principal office of the
Trustee, and at such other places, if any, designated by the Trustee, by
any Certificateholder upon request.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Certificateholders under
the Agreement at any time by the Company and the Trustee with the consent
of the Certificateholders holding Certificates evidencing Fractional
Undivided Interests aggregating not less than a majority in interest in the
Trust. Any such consent by the Certificateholder of this Certificate shall
be conclusive and binding on such Certificateholder and upon all future
Certificateholders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without
the consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations set forth therein, the transfer of this Certificate is
registrable in the Register upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by the
Trustee in its capacity as Registrar, or by any successor Registrar, duly
endorsed or accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Registrar, duly executed by the
Certificateholder hereof or such Certificateholder's attorney duly
authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same aggregate Fractional Undivided
Interest in the Trust will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered
Certificates without coupons in minimum denominations of $1,000 Fractional
Undivided Interest and integral multiples thereof except that one
Certificate may be issued in a different denomination. As provided in the
Agreement and subject to certain limitations therein set forth, the
Certificates are exchangeable for new Certificates of authorized
denominations evidencing the same aggregate Fractional Undivided Interest
in the Trust, as requested by the Certificateholder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trustee shall require payment of a sum
sufficient to cover any tax or governmental charge payable in connection
therewith.
Each Certificateholder and Investor, by its acceptance of
this Certificate or a beneficial interest herein, agrees to treat the Trust
as a grantor trust for all U.S. federal, state and local income tax
purposes.
The Trustee, the Registrar, and any agent of the Trustee or
the Registrar may treat the person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Trustee,
the Registrar, nor any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the
Agreement and the Trust created thereby shall terminate upon the
distribution to Certificateholders of all amounts required to be
distributed to them pursuant to the Agreement and the disposition of all
property held as part of the Trust Property.
Any Person acquiring or accepting this Certificate or an
interest herein will, by such acquisition or acceptance, be deemed to have
represented and warranted that either: (i) the assets of an employee
benefit plan subject to Title I of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or of a plan subject to Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code"), have not been
used to purchase this Certificate or an interest herein or (ii) the
purchase and holding of this Certificate or interest herein are exempt from
the prohibited transaction restrictions of ERISA and the Code pursuant to
one or more prohibited transaction statutory or administration exemptions.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Unless the certificate of authentication hereon has been
executed by the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate
to be duly executed.
US AIRWAYS PASS THROUGH TRUST 1999-1B
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT, NATIONAL
ASSOCIATION, as Trustee
By: /s/ John G. Correia
_____________________________________
Name: John G. Correia
Title:Assistant Secretary
THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
By: STATE STREET BANK AND TRUST
COMPANY OF CONNECTICUT,
NATIONAL ASSOCIATION, as Trustee
By: /s/ John G. Correia
_____________________________________
Name: John G. Correia
Title:Assistant Secretary
Dated: August 31, 1999
Exhibit 5(a)(i)
OPINION OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM (ILLINOIS)
September 3, 1999
US Airways, Inc.
US Airways Group, Inc.
2345 Crystal Drive
Arlington, VA 22227
Re: US Airways, Inc. Pass Through
Certificates, Series 1999-1
Ladies and Gentlemen:
We have acted as special counsel to US Airways Inc., a Delaware
corporation ("US Airways"), and US Airways Group, Inc., a Delaware
corporation ("US Airways Group"), in connection with the registration
statement on Form S-3 filed by US Airways and US Airways Group on June 2,
1999, as amended (the "Registration Statement"), under the Securities Act
of 1933, as amended (the "Act"), relating to the Pass Through Certificates,
Series 1999-1A and the Pass Through Certificates, Series 1999-1B (the "Pass
Through Certificates"). The Pass Through Certificates have been issued and
sold by US Airways pursuant to Rule 415 under the Act for an aggregate
initial offering price of $468,268,000, as described in the prospectus,
dated July 30,1999, relating to the Pass Through Certificates and contained
in the Registration Statement (the "Basic Prospectus"), as supplemented by
a prospectus supplement, dated August 24, 1999 (the "Prospectus
Supplement").
The Pass Through Certificates relate to the US Airways Pass
Through Trust 1999-1A and the US Airways Pass Through Trust 1999-1B (the
"Trusts") formed by US Airways pursuant to a Pass Through Trust Agreement,
dated July 30, 1999 (the "Pass Through Trust Agreement"), among US Airways,
US Airways Group and State Street Bank and Trust Company of Connecticut,
National Association (the "Trustee"), a form of which has been filed as an
exhibit to the Registration Statement, as supplemented by Trust Supplement
No. 1999-1A, dated as of August 31, 1999, between US Airways and the
Trustee and by Trust Supplement No. 1999-1B, dated as of August 31, 1999,
between US Airways and the Trustee (each a "Pass Through Supplement").
This opinion is delivered in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Act.
We are admitted to the practice of law in the State of Illinois
and express no opinion herein concerning any law other than the laws of the
State of New York, the General Corporation Law of the State of Delaware and
the laws of the United States of America to the extent specifically
referred to herein. Insofar as the opinions expressed herein relate to or
are dependent upon matters governed by the laws of the State of New York,
we have relied upon the opinion of Skadden, Arps, Slate, Meagher & Flom
LLP.
In connection with this opinion, we have examined originals, or
copies certified or otherwise identified to our satisfaction, of (i) the
Registration Statement, (ii) the Basic Prospectus, (iii) the Prospectus
Supplement, (iv) the Pass Through Trust Agreement, (v) each Pass Through
Supplement, (vi) the Pass Through Certificates, (vii) the Statement of
Eligibility and Qualification under the Trust Indenture Act of 1939, as
amended (the "1939 Act"), on Form T-1 of the Trustee, (viii) the Amended
and Restated Certificate of Incorporation of each of US Airways and US
Airways Group, as currently in effect, (ix) the By-Laws of each of US
Airways and US Airways Group, as currently in effect, and (x) resolutions
adopted by the Board of Directors of each of US Airways and US Airways
Group on May 18, 1999 relating to the filing of the Registration Statement.
We also have examined originals or copies, certified or otherwise
identified to our satisfaction, of such records of US Airways and US
Airways Group and such agreements, certificates of public officials,
certificates of officers and other representatives of US Airways and US
Airways Group and others, and such other documents, certificates and
records as we have deemed necessary or appropriate as a basis for the
opinion set forth herein.
In our examination, we have assumed the legal capacity of natural
persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified or photostatic
copies and the authenticity of originals of all such documents. In making
our examination of documents executed by parties other than US Airways and
US Airways Group, we have assumed that such parties (including the Trustee)
had the power, corporate or other, to enter into and perform all
obligations thereunder and have also assumed the due authorization by all
requisite action, corporate or other, and execution and delivery by such
parties of such documents, and the validity and binding effect thereof on
such parties; provided, however, that we have not assumed the validity and
binding effect thereof with respect to the Trustee. As to any facts
material to the opinion expressed herein which we did not independently
establish or verify, we have relied upon oral or written statements and
representations of officers and other representatives of US Airways and US
Airways Group and others, including a Certificate of the Associate General
Counsel of US Airways.
Based upon the foregoing and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that the Pass Through Certificates are valid and legally binding
obligations of the Trustee as trustee of the Trusts.
Our opinion set forth above is subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding
in equity or at law) and an implied covenant of good faith and fair
dealing.
We hereby consent to the filing of this opinion with the
Commission as an exhibit to the Registration Statement. We also consent to
the reference to our firm under the heading "Legal Opinions" in the
Registration Statement. In giving this consent, we do not thereby admit
that we are in the category of persons whose consent is required under
Section 7 of the Act or the rules and regulations of the Commission.
Very truly yours,
/s/ Skadden, Arps, Slate,
Meagher & Flom (Illinois)
Exhibit 5(a)(ii)
September 3, 1999
Skadden, Arps, Slate, Meagher & Flom (Illinois)
333 West Wacker Drive
Chicago, Illinois 60606
Re: US Airways, Inc. Pass Through
Certificates, Series 1999-1
Ladies and Gentlemen:
We have acted as your special New York counsel to US Airways,
Inc., a Delaware corporation ("US Airways"), and US Airways Group, Inc., a
Delaware corporation ("US Airways Group"), in connection with the
registration statement on Form S-3 filed by US Airways and US Airways Group
on June 2, 1999, as amended, (the "Registration Statement") under the
Securities Act of 1933, asamended (the "Act"), relating to the Pass Through
Certificates, Series 1999-1A and the Pass Through Certificates, Series
1999-1B (the "Pass Through Certificates"). The Pass Through Certificates
have been issued and sold by US Airways pursuant to Rule 415 under the Act
for an aggregate initial offering price of $468,268,000, as described in
the prospectus, dated July 30,1999, relating to the Pass Through
Certificates and contained in the Registration Statement (the "Basic
Prospectus"), as supplemented by a prospectus supplement, dated August 24,
1999 (the "Prospectus Supplement").
The Pass Through Certificates relate to the US Airways Pass
Through Trust 1999-1A and the US Airways Pass Through Trust 1999-1B (the
"Trusts") formed by US Airways pursuant to a Pass Through Trust Agreement,
dated July 30, 1999 (the "Pass Through Trust Agreement"), among US Airways,
US Airways Group and State Street Bank and Trust Company of Connecticut,
National Association (the "Trustee"), a form of which has been filed as an
exhibit to the Registration Statement, as supplemented by Trust Supplement
No. 1999-1A, dated as of August 31, 1999, between US Airways and the
Trustee and by Trust Supplement No. 1999-1B, dated as of August 31, 1999,
between US Airways and the Trustee (each a "Pass Through Supplement").
We are members of the Bar of the State of New York and we express
no opinion herein concerning any law other than the laws of the State of
New York.
In connection with this opinion, we have examined and relied on,
or have discussed with you to the extent we have considered necessary or
appropriate for the opinions expressed herein, originals or copies of (i)
the Registration Statement, (ii) the Basic Prospectus, (iii) the Prospectus
Supplement, (iv) the Pass Through Trust Agreement, (v) each Pass Through
Supplement, (vi) the Pass Through Certificates, (vii) the Statement of
Eligibility and Qualification under the Trust Indenture Act of 1939, as
amended (the "1939 Act"), on Form T-1 of the Trustee, (viii) the Amended
and Restated Certificate of Incorporation of each of US Airways and US
Airways Group, as currently in effect, (ix) the By-Laws of each of US
Airways and US Airways Group, as currently in effect, and (x) resolutions
adopted by the Board of Directors of each of US Airways and US Airways
Group on May 18, 1999 relating to the filing of the Registration Statement.
We also have examined and relied on, or have discussed with you to the
extent we have considered necessary or appropriate for the opinions
expressed herein, originals or copies of such records of US Airways and US
Airways Group and such agreements, certificates of public officials,
certificates of officers and other representatives of US Airways and US
Airways Group and others, and such other documents, certificates and
records as we have deemed necessary or appropriate as a basis for the
opinion set forth herein.
In our examination, we have assumed the legal capacity of natural
persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified or photostatic
copies and the authenticity of originals of all such documents. In making
our examination of documents executed by parties other than US Airways and
US Airways Group, we have assumed that such parties (including the Trustee)
had the power, corporate or other, to enter into and perform all
obligations thereunder and have also assumed the due authorization by all
requisite action, corporate or other, and execution and delivery by such
parties of such documents, and the validity and binding effect thereof on
such parties; provided, however, that we have not assumed the validity and
binding effect thereof with respect to the Trustee. As to any facts
material to the opinion expressed herein which we did not independently
establish or verify, we have relied upon oral or written statements and
representations of officers and other representatives of US Airways and US
Airways Group and others, including a Certificate of the Associate General
Counsel of US Airways.
Based upon the foregoing and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that the Pass Through Certificates are valid and legally binding
obligations of the Trustee as trustee of the Trusts.
Our opinion set forth above is subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding
in equity or at law) and an implied covenant of good faith and fair
dealing.
We hereby consent to the filing of this opinion with the
Commission as an exhibit to the Registration Statement. We also consent to
the reference to our firm under the heading "Legal Opinions" in the
Registration Statement. In giving this consent, we do not thereby admit
that we are in the category of persons whose consent is required under
Section 7 of the Act or the rules and regulations of the Commission.
We understand that you intend to rely on this opinion for
purposes of rendering your opinion pursuant to the requirements of Item
601(b)(5) of Regulation S-K under the Act, and we consent to your reliance
hereon for such purpose. This opinion is not to be used, circulated,
quoted or otherwise referred to for any other purposes or relied upon by
any other person without our express written consent.
Very truly yours,
Skadden, Arps, Slate, Meagher & Flom, LLP
