As filed with the Securities and Exchange Commission on September 7, 2000
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
___________
NORTHWEST AIRLINES CORPORATION NORTHWEST AIRLINES, INC.
(Exact name of Registrants as specified in their charters)
Delaware Minnesota
(State or other jurisdiction of incorporation or organization)
4512 4512
(Primary Standard Industrial Classification Code Number)
41-1905580 41-0449230
(I.R.S. Employer Identification Number)
___________
2700 Lone Oak Parkway
Eagan, Minnesota 55121
(612) 726-2111
(Address, including zip code, and telephone number, including area code, of
Registrants' principal executive offices)
___________
Douglas M. Steenland, Esq.
Executive Vice President, General Counsel and Secretary
Northwest Airlines Corporation
2700 Lone Oak Parkway
Eagan, Minnesota 55121
(612) 726-2111
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
___________
Copy to:
Stephan J. Feder, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3954
(212) 455-2000
___________
Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. / /
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If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, as amended, other than securities offered only in connection with
dividend or interest reinvestment plans, please check the following box. /x/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
Pursuant to Rule 429 of the Rules and Regulations of the Securities and
Exchange Commission under the Securities Act of 1933, the Forms of Prospectus
included in this Registration Statement also relate to an aggregate remaining
amount of $39,902,000 of the classes of Securities covered by such Forms of
Prospectus previously registered under the Registration Statement on Form S-3
(File No. 333-79215). A filing fee of $283,893.60 was paid on May 25, 1999 in
connection with the remaining amount of Securities registered under the
Registration Statement on Form S-3 (File No. 333-79215). This Registration
Statement is a new Registration Statement, constitutes Post Effective
Amendment No.1 to Registration Statement No. 333-79215, and such Post-
Effective Amendment shall hereafter become effective concurrently with the
effectiveness of this Registration Statement and in accordance with
Section 8(c) of the Securities Act of 1933.
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
___________
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CALCULATION OF REGISTRATION FEE
<TABLE>
Proposed Maximum
Aggregate Offering Amount of
Title of Each Class of Securities to be Registered Price(1) Registration Fee
<S> <C> <C>
Guarantees of Northwest Airlines Corporation (2)
Debt Securities of Northwest Airlines, Inc. (3) $975,000,000 $259,957.24
Warrants to Purchase Debt Securities of Northwest Airlines,
Inc. (4)
Pass Through Certificates of Northwest Airlines, Inc. (3)
</TABLE>
(1) In United States dollars or the equivalent thereof in foreign
currency or currency units. Estimated solely for purposes of
calculating the registration fee pursuant to Rule 457(o) under the
Securities Act of 1933.
(2) To be issued in connection with debt securities and pass through
certificates of Northwest Airlines, Inc.
(3) If any of these securities are issued at an original issue discount,
the principal amount at maturity will be higher than the aggregate
proceeds received.
(4) Warrants to purchase debt securities of Northwest Airlines, Inc. may
be offered and sold separately or together with the debt securities
of Northwest Airlines, Inc.
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EXPLANATORY NOTE
This Registration Statement consists of two separate Prospectuses,
covering securities to be registered as follows:
. debt securities and warrants to purchase debt securities of Northwest
Airlines, Inc. and guarantees of the debt securities by Northwest
Airlines Corporation; and
. pass through certificates of Northwest Airlines, Inc. and related
guarantees of Northwest Airlines Corporation.
Separate financial statements of Northwest Airlines, Inc. are not being
provided because all of the securities being issued by Northwest
Airlines, Inc. under this registration statement are fully and
unconditionally guaranteed by Northwest Airlines Corporation and such
separate financial statements are therefore not deemed material.
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SUBJECT TO COMPLETION, DATED , 2000
PROSPECTUS
$975,000,000
NORTHWEST AIRLINES, INC.
Debt Securities and Warrants to Purchase Debt Securities
-----------------
Payment of Principal, Premium, if any, and Interest Fully and Unconditionally
Guaranteed by
NORTHWEST AIRLINES CORPORATION
-----------------
Northwest Airlines, Inc. may from time to time offer its debt securities
and warrants to purchase debt securities. The debt securities will be fully and
unconditionally guaranteed by Northwest Airlines Corporation, the indirect
parent of Northwest Airlines, Inc.
When we decide to sell a particular series of securities, we will provide
specific terms of the offered securities in a prospectus supplement. You
should read this prospectus and any prospectus supplement carefully before
you invest.
-----------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary
is a criminal offense.
-----------------
The date of this prospectus is , 2000
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TABLE OF CONTENTS
Page
About this Prospectus . . . . . . . . . . . . . . . . . 3
Incorporation of Certain Documents by Reference . . . . 4
Disclosure Regarding Forward-looking Statements . . . . 4
The Company . . . . . . . . . . . . . . . . . . . . . . 5
Use of Proceeds . . . . . . . . . . . . . . . . . . . . 5
Ratio of Earnings to Fixed Charges . . . . . . . . . . 5
Description of Debt Securities . . . . . . . . . . . . 7
Description of Warrants . . . . . . . . . . . . . . . . 20
Plan of Distribution . . . . . . . . . . . . . . . . . 23
Legal Opinions . . . . . . . . . . . . . . . . . . . . 25
Experts . . . . . . . . . . . . . . . . . . . . . . . . 25
You should rely only on the information provided in this prospectus and
any prospectus supplement, including the information incorporated by reference.
We have not authorized anyone to provide you with different information.
Northwest Airlines, Inc. will offer to sell the securities and seek offers to
buy the securities, only in jurisdictions where offers and sales are
permitted. The information contained in or incorporated by reference in this
prospectus is accurate only as of the date of this prospectus, regardless of
the time of delivery of this prospectus or of any sales of the securities.
ABOUT THIS PROSPECTUS
This prospectus is part of registration statements that we filed with the
Securities and Exchange utilizing a "shelf" registration process. Under this
shelf process, we may sell any combination of debt securities and warrants to
purchase debt securities described in this prospectus in one or more
offerings up to a total dollar amount of $975,000,000 or the equivalent of
this amount in foreign currencies or foreign currency units.
This prospectus provides you with a general description of the securities
we may offer. Each time we offer securities, we will provide you with a
prospectus supplement that will describe the specific amounts, prices and
terms of the offered securities. The prospectus supplement may also add,
update or change information contained in this prospectus. You should read
both this prospectus and any prospectus supplement together with additional
information described below under "Incorporation of Certain Documents by
Reference."
This prospectus does not contain all of the information in the
registration statements. Statements we make in this prospectus about the
contents of any contract, agreement or other document are not necessarily
complete. If that contract, agreement or other document has been filed as an
exhibit to the registration statements, we refer you to the exhibit for a more
complete description. The information in this prospectus is accurate only as
of the date of this prospectus, regardless of the time of delivery of this
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prospectus or any sale of the securities.
In this prospectus, "Northwest" refers to Northwest Airlines, Inc., "NWA
Corp." to Northwest Airlines Corporation and the "Company," "we," "us" or
"our" to NWA Corp. and its consolidated subsidiaries.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
NWA Corp. files annual, quarterly and current reports, proxy statements
and other information with the SEC. You may read and copy any document we file
at the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available
to the public over the internet at the SEC's web site at http://www.sec.gov.
Northwest is not required to file separate reports, proxy and information
statements or other information with the SEC pursuant to the Securities
Exchange Act of 1934. Instead, we have provided information with respect to
Northwest, to the extent required, in filings made by NWA Corp.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference
is considered to be a part of this prospectus, and information that we file
later with the SEC will automatically update and supersede this information.
We incorporate by reference the documents listed below and any future filings
made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until we complete our offering of the securities:
. Annual Report on Form 10-K for the year ended December 31, 1999;
. Quarterly Reports on Form 10-Q for the quarters ended March 31, 2000
and June 30, 2000; and
. Current Reports on Form 8-K filed on January 18, 2000 and July 11, 2000.
You may request a copy of these filings (other than exhibits to them) at
no cost, by writing or telephoning us at the following address:
Secretary's Office
Northwest Airlines Corporation
5101 Northwest Drive, Dept. A1180
St. Paul, Minnesota 55111-3034
Telephone: (612) 726-2111
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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These forward-looking statements are subject to a
number of risks and uncertainties, all of which are difficult to predict and
many of which are beyond our control. Forward-looking statements are
typically identified by the words "may," "will," "believe," "expect,"
"anticipate," "intend," "estimate" and similar expressions. Actual results
could differ materially from those contemplated by these forward-looking
statements as a result of a number of factors. It is not reasonably possible
to itemize all of the many factors and specific events that could affect the
outlook of an airline operating in the global economy. Some factors that
could significantly impact expected capacity, load factors, revenues,
expenses and cash flows include the airline pricing environment, fuel costs,
labor negotiations both at the Company and other carriers, low-fare carrier
expansion, capacity decisions of other carriers, actions of the U.S. and
foreign governments, foreign currency exchange rate fluctuation, inflation,
the general economic environment in the U.S. and other regions of the world
and other factors discussed herein.
In light of these risks and uncertainties, we cannot assure you that the
results and events contemplated by the forward-looking statements contained
in this prospectus will in fact be realized. Potential investors should not
place undue reliance on these forward-looking statements. We do not undertake
any obligation to update or revise any forward-looking statements. All
subsequent written or oral forward-looking statements attributable to us or
persons acting on our behalf are expressly qualified in their entirety by the
factors described above.
THE COMPANY
NWA Corp. is the indirect parent corporation of Northwest. Northwest
operates the world's fourth largest airline (as measured by 1999 revenue
passenger miles ("RPMs")) and is engaged in the business of transporting
passengers and cargo. Northwest began operations in 1926 and its business
focuses on the development of a global airline network through its strategic
assets that include:
. domestic hubs at Detroit, Minneapolis/St. Paul and Memphis;
. an extensive Pacific route system with hubs at Tokyo and Osaka;
. a trans-Atlantic alliance with KLM Royal Dutch Airlines which
operates through a hub in Amsterdam; and
. a global alliance with Continental Airlines, Inc.
Northwest has developed strategies that are designed to utilize the
Company's strategic assets to its competitive advantage. These strategies focus
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on providing safe, reliable, convenient and consistent air transportation. In
addition, the Company's frequent flyer program, customer service improvements
and targeted fare promotions are designed to maintain and improve its
competitive position.
Northwest operates substantial domestic and international route networks
and directly serves more than 150 cities in 21 countries in North America, Asia
and Europe. Northwest had more than 56.1 million enplanements and flew over
74.2 billion RPMs in 1999.
Our principal executive offices are located at 2700 Lone Oak Parkway,
Eagan, Minnesota 55121; our mailing address is 5101 Northwest Drive, St. Paul,
Minnesota 55111-3034 and our telephone number is (612) 726-2111.
USE OF PROCEEDS
Unless the applicable prospectus supplement indicates otherwise, net
proceeds from the sale of the offered securities will be added to Northwest's
working capital. We will use the proceeds for general corporate purposes,
including the repayment of outstanding indebtedness and financing of capital
expenditures. We do not currently expect to discharge any indebtedness or
finance any capital expenditures with the proceeds of the sale of the offered
securities.
RATIO OF EARNINGS TO FIXED CHARGES
We have set forth below the ratio of earnings to fixed charges for NWA Corp.
and its consolidated subsidiaries for the periods indicated. The ratio of
earnings to fixed charges represents the number of times that fixed charges
were covered by earnings. In computing the ratio, earnings represent
consolidated earnings (loss) before income taxes, cumulative effect of
accounting change and fixed charges (excluding capitalized interest). Fixed
charges consist of interest expense (including capitalized interest), one-
third of rental expense, which is considered representative of the interest
factor, and amortization of debt discount and expense.
Year ended December 31, Six months ended June 30,
1999 1998 1997 1996 1995 2000 1999
---- ---- ---- ---- ---- ---- ----
1.64 (a) 3.05 2.74 1.90 1.43 1.36
___________
(a) Earnings were inadequate to cover fixed charges by $452 million for
the year ended December 31, 1998.
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DESCRIPTION OF DEBT SECURITIES
The debt securities offered pursuant to this prospectus will be unsecured
obligations and will be either senior or subordinated debt. Senior debt will
be issued under a senior debt indenture. Subordinated debt will be issued
under a subordinated debt indenture. The senior debt indenture and the
subordinated debt indenture are sometimes referred to in this prospectus
individually as an "indenture" and together as the "indentures." The form of
each indenture has been filed with the SEC and is incorporated by reference
in the registration statement of which this prospectus is a part.
The following briefly summarizes certain general terms and provisions of
the debt securities and the indentures to which any prospectus supplement may
relate. The applicable prospectus supplement will describe the particular
terms and provisions of the debt securities offered by that prospectus
supplement and the application of these general terms and provisions to them.
Northwest may offer a series of debt securities at the same time that it
makes an offer of warrants to purchase an additional portion of the same or
another series of debt securities. Northwest also may offer warrants to
purchase a series of debt securities independently of any offering of debt
securities. See "Description of Warrants."
The statements in this prospectus relating to the debt securities and the
indentures are summaries. You should refer to the indentures for the complete
terms of the debt securities and the indentures, including the definitions of
certain capitalized terms in this prospectus. Where we make no distinction
between senior debt securities and subordinated debt securities or between
the senior indenture and the subordinated indenture, those summaries refer to
any debt securities and either indenture. Whenever we refer to particular
defined terms of the indentures in this prospectus or in a prospectus
supplement, those defined terms are incorporated by reference in this
prospectus or in that prospectus supplement.
The applicable prospectus supplement will set forth the anticipated market
for the debt securities and the specific use of proceeds of an offering of
debt securities.
To the extent that any provision in any prospectus supplement is
inconsistent with any provision in this summary, the provision of the
prospectus supplement will control.
General
The indentures do not limit the aggregate principal amount of debt
securities which may be issued under those indentures. Northwest may issue from
time to time debt securities in one or more series under those indentures. The
senior debt securities will be unsecured and unsubordinated obligations of
Northwest and will rank equally with all other unsecured and unsubordinated
indebtedness of Northwest. The subordinated debt securities will be unsecured
obligations of Northwest and, as set forth below under "Subordination of
Subordinated Debt Securities," will be subordinated in right of payment to
all senior indebtedness of Northwest.
You should refer to the prospectus supplement which accompanies this
prospectus for a description of the specific series of debt securities that
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Northwest is offering by that prospectus supplement or, if Northwest is
offering warrants, the debt securities that it will issue upon exercise of
those warrants. These terms may include:
. the specific designation of the debt securities, including whether
they are senior debt securities or subordinated debt securities;
. any limit upon the aggregate principal amount of the debt securities;
. the maturity date or dates of the principal of the debt securities
or the method of determining the maturity date or dates;
. the rate or rates (which may be fixed or variable) at which the
debt securities will bear interest, if there is any interest, or
the method of calculating the interest rate or rates;
. the date or dates on which interest, if any, will accrue or the
method of determining that date or dates;
. the date or dates on which interest, if any, will be payable and
the record date or dates for the interest payment date or dates;
. the place or places where principal of or, premium, if any, and
interest, if any, on the debt securities will be payable;
. if Northwest may redeem, at its option, the debt securities in whole
or in part,
- the period or periods,
- the price or prices,
- the currency or currencies (including currency units) and
- the terms and conditions for the optional redemption or
redemptions;
. if Northwest is obligated to redeem or purchase the debt securities
in whole or in part, pursuant to any sinking fund or similar
provisions, upon the happening of specified events or at the option
of a holder of the debt securities,
- the period or periods,
- the price or prices and
- the terms and conditions for the mandatory redemption or
redemptions;
. the denominations of the debt securities that Northwest is
authorized to issue;
. regarding the currency or currency units,
- the currency or currency units for which the debt securities
may be purchased or in which the debt securities may be
denominated, and/or
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- the currency or currency units in which principal of,
premium, if any, and /or interest, if any, on the debt
securities will be payable or redeemable, and
- whether Northwest or the holders of any debt securities may
elect to pay or receive payments in a currency or currency
units other than the currency in which the debt securities
are stated to be payable or redeemable;
. if other than the principal amount, the portion of the principal amount
of the debt securities which will be payable upon declaration
of the acceleration of the maturity, or the method by which that
portion will be determined;
. the person to whom any interest on any debt security will be payable,
if other than the person in whose name that debt security is
registered on the applicable record date;
. any addition to, or modification or deletion of, any event of default
or any covenant of Northwest or NWA Corp. specified in the applicable
indenture;
. the application, if any, of the means of defeasance or covenant
defeasance specified for the debt securities and coupons, if any;
. whether the debt securities are to be issued in whole or in part in
the form of one or more temporary or permanent global securities and,
if so, the identity of the depositary for such global security or
securities;
. the terms and conditions relating to warrants issued by Northwest, if
any, in connection with or for the purchase of the debt securities;
. any index used to determine the amount of payments of principal of,
and premium, if any, and interest, if any, on the debt securities;
. any provisions relating to the exchange of the debt securities; and
. any other special terms of the debt securities.
Unless the applicable prospectus supplement specifies otherwise, the debt
securities will not be listed on any securities exchange.
Unless the applicable prospectus supplement specifies otherwise, Northwest
will issue debt securities in fully registered form without coupons. If
Northwest issues debt securities of any series in bearer form, the applicable
prospectus supplement will describe the special restrictions and
considerations, including special offering restrictions and special Federal
income tax considerations, applicable to those debt securities and to payment
on and transfer and exchange of those debt securities. Debt securities issued
in bearer form will be transferable by delivery.
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Debt securities may be sold at a substantial discount below their stated
principal amount, bearing no interest or interest at a rate which at the time
of issuance is below market rates. Certain Federal income tax consequences
and special considerations applicable to those debt securities will be
described in the applicable prospectus supplement.
The applicable prospectus supplement also will set forth the foreign
currency or currency units and describe the restrictions, elections, certain
Federal income tax considerations, specific terms and other information with
respect to the issue of debt securities, if:
. the purchase price of any debt securities is payable in one or
more foreign currencies or currency units,
. any debt securities are denominated in one or more foreign currencies
or currency units, or
. the principal of, premium, if any, or interest, if any, on any
debt securities is payable in one or more foreign currencies or
currency units.
Denominations, Payment, Registration, Transfer and Exchange
Northwest will issue debt securities in registered form in denominations
of $1,000 and integral multiples of $1,000. Northwest will issue debt
securities in bearer form in denominations of $5,000. In each case, Northwest
may issue debt securities in other denominations and currencies. Subject to
any applicable laws or regulations, Northwest will make payments on the debt
securities in the designated currency at the designated office or agency of
Northwest, unless the applicable prospectus supplement sets forth otherwise.
However, Northwest at its option may make interest payments, if any, on debt
securities in registered form:
. by checks mailed by the applicable trustee to the holders of
debt securities entitled to interest payments at their registered
addresses, or
. by wire transfer to an account maintained by the person entitled
to interest payments as specified in the debt register.
Unless the applicable prospectus supplement indicates otherwise, Northwest
will pay any installment of interest on debt securities in registered form to
the person in whose name the debt security is registered at the close of
business on the regular record date for that installment of interest.
Subject to any applicable laws and regulations, Northwest will make
payments on debt securities in bearer form in the currency and in the manner
designated in the applicable prospectus supplement at the paying agencies
outside the United States as it may appoint from time to time. The applicable
prospectus supplement will name the paying agents outside the United States
initially appointed by Northwest. Northwest may at any time designate
additional paying agents or rescind the designation of any paying agents.
However, if debt securities of a series are issuable in the form of
registered securities, Northwest will be required to maintain at least one
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paying agent in each place of payment specified for that series. If debt
securities of a series are issuable in the form of bearer securities,
Northwest will be required to maintain a paying agent in a place of payment
specified for that series outside the United States where the debt securities
of that series and any related coupons may be presented and surrendered for
payment. In connection with the payment of the principal of, premium, if any,
and interest, if any, on a debt security, Northwest will have the right to
require the holder to certify information to Northwest. In the absence of
that certification, Northwest will be entitled to rely on any legal
presumption to enable Northwest to determine its duties and liabilities, if
any, to deduct or withhold taxes, assessments or governmental charges from
that payment.
Unless the applicable prospectus supplement sets forth otherwise, debt
securities issued in registered form will be transferable or exchangeable at
the agency of Northwest designated by it from time to time. Debt securities
may be transferred or exchanged without service charge, other than any tax or
other governmental charge imposed in connection with the transfer or
exchange.
If Northwest redeems any debt securities in part, Northwest will not be
required:
. to issue, register the transfer of or exchange debt securities of
any series during a period beginning at the opening of business 15
days before any selection of debt securities of the series to be
redeemed and ending at the close of business on
- the day of mailing of the notice of redemption, if the debt
securities of that series are issuable only as registered securities,
- the day of the first publication of the notice of redemption, if
the debt securities of that series are issuable only as in bearer
form, or
- the day of mailing of the notice of redemption, if the debt
securities of that series are issuable both in bearer form and as
registered securities and there is no publication;
. to register the transfer or exchange of any debt securities issued
in registered form, or their portion, called for redemption or
otherwise surrendered for repayment, except the unredeemed or
unrepaid portion of any registered security being redeemed or repaid
in part; or
. to exchange any debt security issued in bearer form which is called
for redemption, except to exchange that bearer security for a
registered debt security of that series and like tenor which is
immediately surrendered for redemption.
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Subordination of Subordinated Debt Securities
The obligation of Northwest to pay the principal of, premium, if any, and
interest, if any, on the subordinated debt securities will be subordinated
and junior in right of payment to the prior payment in full of all "senior
indebtedness" (as defined below) of Northwest. The subordinated debt
securities will rank equally with any future indebtedness of Northwest which
by its terms states that it will rank equally with the subordinated debt
securities. The subordinated debt securities will rank senior to all other
existing and future subordinated indebtedness or other subordinated
obligations of Northwest. However, payment from the funds held in any
defeasance trust described under "Defeasance" below is not subordinate to any
senior Indebtedness or subject to the restrictions described in this
prospectus.
"Senior indebtedness" of Northwest means all "indebtedness" (as defined
below) of Northwest (other than the subordinated debt securities) unless the
indebtedness, by its terms or the terms of the instrument creating or
evidencing it, is subordinate in right of payment to or equal with the
subordinated debt securities. Senior indebtedness, however, does not include:
. any indebtedness, guarantee or other obligation of Northwest that
is subordinated or junior in any respect to any other indebtedness of
Northwest, or
. any indebtedness of Northwest to any of its subsidiaries or to any
person of which Northwest is a subsidiary.
"Indebtedness" means, without duplication, the principal of, premium, if
any, and any accrued and unpaid interest (including post-petition interest,
whether or not allowable as a claim in bankruptcy) on:
. indebtedness for money borrowed;
. guarantees of indebtedness for money borrowed;
. indebtedness evidenced by notes, debentures, bonds or other instruments
of indebtedness;
. obligations for the reimbursement of any obligor on any letter of
credit, banker's acceptance or similar credit transaction;
. obligations under capitalized leases and flight equipment leases;
. obligations under interest rate and currency swaps, caps, collars
options, forward or spot contracts or similar arrangements or with
respect to foreign currency hedges or aircraft fuel hedges;
. commitment and other bank financing fees under contractual obligations
associated with bank debt;
. any indebtedness representing the deferred and unpaid purchase price of
any property or business; and
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. all deferrals, renewals, extensions and refundings of any of these
indebtedness or obligations.
However, indebtedness does not include:
. amounts owed to trade creditors in the ordinary course of business,
. nonrecourse indebtedness secured by real property located outside the
United States, or
. operating lease rental payments (other than flight equipment lease
rental payments) in the ordinary course of business.
Northwest may not pay the principal of, premium, if any, or interest on
the subordinated debt securities or deposit pursuant to the provisions
described under "Defeasance" below if:
. any senior Indebtedness is not paid when due (following the expiration
of any applicable grace period); or
. any other default on senior Indebtedness occurs and the maturity of any
senior Indebtedness is accelerated in accordance with its terms,
unless, in either case,
. the failure to pay or the acceleration relates to senior Indebtedness
in an aggregate amount equal to or less than $20 million;
. the default has been cured or waived or has ceased to exist;
. the acceleration has been rescinded; or
. the senior Indebtedness has been paid in full.
A failure to make any payment with respect to the subordinated debt
securities as a result of the foregoing provisions will not limit the right
of the holders of the subordinated debt securities to accelerate the maturity
as a result of the payment default.
If any distribution of the assets of Northwest is made upon any
dissolution, total or partial liquidation or reorganization of or similar
proceeding relating to Northwest, the holders of senior indebtedness will be
entitled to receive payment in full before the holders of the subordinated
debt securities are entitled to receive any payment. Because of this
subordination, in the event of insolvency, creditors of Northwest who are
holders of senior indebtedness or of other unsubordinated indebtedness may
recover more, ratably, than the holders of the subordinated debt securities.
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The Guarantee of NWA Corp.
NWA Corp. will unconditionally guarantee, pursuant to the indentures, the
due and punctual payment of the principal of, premium, if any, and interest, if
any, on the debt securities when they become due, whether by acceleration or
otherwise. The guarantee of NWA Corp. will be enforceable without any need
first to enforce debt securities against Northwest. The guarantee of NWA
Corp. of the subordinated debt securities will be subordinated and junior in
right of payment to the prior payment in full of all senior indebtedness of
NWA Corp. The terms of the subordination will parallel the subordination
terms applicable to the subordinated debt securities set forth above under
"Subordination of Subordinated Debt Securities." For purposes of the
guarantee of NWA Corp., senior indebtedness of NWA Corp. means all
indebtedness of NWA Corp. other than the guarantee of NWA Corp., unless the
indebtedness, by its terms or by the terms of the instrument creating or
evidencing it, is subordinate in right of payment to or equal with the
guarantee of NWA Corp. However, the senior indebtedness of NWA Corp. does not
include any indebtedness of NWA Corp. to any of its subsidiaries. The
guarantee of NWA Corp. of the subordinated debt securities will rank equally
with any future indebtedness of NWA Corp. which by its terms states that it
will rank equally with the guarantee of NWA Corp. of the subordinated debt
securities. The guarantee of NWA Corp. of the subordinated debt securities
will rank senior to all other existing and future subordinated indebtedness
or other subordinated obligations of NWA Corp.
Global Debt Securities
Unless otherwise specified in the applicable prospectus supplement, each
series of debt securities will be represented by one fully registered global
certificate. Each global certificate will be deposited with, or on behalf of,
The Depository Trust Company ("DTC") and registered in the name of Cede & Co.
("Cede"), or its nominee. No person acquiring a beneficial interest in a
global debt security will be entitled to physical delivery of a definitive
certificate except as set forth below under "-Definitive Certificates."
Unless and until definitive debt securities are issued, all references to
actions by holder of the debt securities refer to actions taken by DTC, or
its nominee, as the registered holder of the global debt security, upon
instructions from DTC Participants (as defined below), and all references to
distributions, notices, reports and statements to the holders of debt
securities refer, as the case may be, to distributions, notices, reports and
statements to DTC or its nominee, as the registered holder of the debt
securities, or to DTC Participants for distribution to the beneficial owners
of interests in the global debt securities in accordance with DTC procedures.
Unless and until definitive certificates are issued, the only debt security
"holder" will be Cede, as nominee of DTC. Beneficial owners will not be
recognized by the trustee as holders of debt securities, as such term is used
in the indentures, and beneficial owners will be permitted to exercise the
rights of holders only indirectly through DTC and DTC Participants.
Northwest has been advised that DTC is a limited purpose trust company
organized under the laws of the State of New York, a member of the Federal
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Reserve System, a "clearing corporation" within the meaning of the New York
Uniform Commercial Code and "clearing agency" registered pursuant to
section 17A of the Exchange Act. DTC was created to hold securities for its
participants ("DTC Participants") and to facilitate the clearance and
settlement of securities transactions between DTC Participants through
electronic book-entries, thereby eliminating the need for physical transfer
of certificates. DTC Participants include securities brokers and dealers,
banks, trust companies and clearing corporations. Indirect access to the DTC
system also is available to others such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a DTC
Participant either directly or indirectly ("Indirect Participants").
Purchases, sales and transfers of the ownership of, or other interests in,
the debt securities must be made by or through DTC Participants and Indirect
Participants, which will receive a credit for the debt securities on DTC's
record. The ownership interest of each beneficial owner of the debt
securities is in turn recorded on the Direct Participant's and Indirect
Participant's records.
DTC has advised Northwest that it will take any action permitted to be
taken by a holder of debt securities under the applicable indenture only at the
direction of one or more DTC Participants to whose accounts with DTC the debt
securities are credited. Additionally, DTC has advised Northwest that in the
event any action requires approval by holders of a certain percentage (or
principal amount) of debt securities, DTC will take such action only at the
direction of and on behalf of DTC Participants whose holders satisfy any such
percentage (or amount). DTC may take conflicting actions with respect to
other debt securities to the extent that such actions are taken on behalf of
DTC Participants whose holders have such debt securities.
Distributions of principal and interest on the global debt securities will
be made by the trustee to CEDE, as nominee for DTC. DTC will forward such
payments in same-day funds to DTC Participants who are credited with
ownership of the debt securities in amounts proportionate to the aggregate
principal amount of the debt securities of the applicable series. DTC
Participants will thereafter forward payments to Indirect Participants or
beneficial owners, as the case may be, in accordance with customary industry
practices. The forwarding of distributions to the beneficial owners of debt
securities will be the responsibility of the DTC Participants.
Under the rules, regulations and procedures creating and affecting DTC and
its operations (the "Rules"), DTC is required to make book-entry transfers of
the debt securities among DTC Participants on whose behalf it acts with
respect to the debt securities and to receive and transmit distributions of
principal, premium, if any, and interest with respect to the debt securities.
DTC Participants and Indirect Participants with which beneficial owners of
the debt securities have accounts similarly are required to make book-entry
transfers and receive and transmit such payments on behalf of their
respective customers. Accordingly, although beneficial owners of the debt
securities will not possess the debt securities, the Rules provide a
mechanism by which those beneficial owners will receive payments and will be
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able to transfer their interests.
Because DTC can only act on behalf of DTC Participants, who in turn act on
behalf of Indirect Participants, the ability of a beneficial owner to pledge
its debt securities to persons or entities that do not participate in the DTC
system, or to otherwise act with respect to such debt securities, may be
limited due to the lack of a physical certificate for such debt securities.
Neither Northwest, NWA Corp. nor the trustee will have any liability for
any aspect of the records relating to or payments made on account of beneficial
ownership interests in the debt securities held by Cede, as nominee for DTC,
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
The applicable prospectus supplement will specify any additional
book-entry registration procedures applicable to debt securities denominated
in a currency other than United States dollars.
Definitive Certificates
Unless the applicable prospectus supplement specifies otherwise, if DTC
is at any time unwilling or unable to continue as depositary and a successor
depositary is not appointed by Northwest within ninety days, debt securities
in definitive, certificated form will be issued in exchange for the
applicable global debt securities. In addition, Northwest may at any time and
in its sole discretion determine not to have any of the debt securities of a
series or class represented by one or more global certificates. In that
event, debt securities in definitive, certificated form will be issued in
exchange for the applicable global debt securities. Further, if Northwest so
specifies, an owner of a beneficial interest in a global debt security may,
on terms acceptable to Northwest and DTC, receive definitive, certificated
debt securities registered in the name of that beneficial owner or its
designee.
Upon the occurrence of any event described in the immediately preceding
paragraph, the trustee will be required to notify all beneficial owners
through DTC Participants of the availability of definitive certificates. Upon
surrender by DTC of the certificates representing the debt securities and
receipt of instructions for re-registration, the trustee will reissue the
debt securities as definitive debt securities to the beneficial owners.
Distributions of principal, premium, if any, and interest on debt
securities will thereafter be made by the trustee directly in accordance with
the procedures set forth in the indenture and the applicable trust agreement
supplement, to holders in whose names the definitive debt securities were
registered at the close of business on the applicable record date. These
distributions will be made by check mailed to the address of the holder as it
appears on the register maintained by the trustee. The final payment on any
debt security, however, will be made only upon presentation and surrender of
the definitive debt security at the office or agency specified in the notice
of final distribution to holders of the debt securities.
Definitive debt securities will be freely transferable and exchangeable at
the office of the trustee upon compliance with the requirements set forth in
the applicable indenture. No service charge will be imposed for any
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registration of transfer or exchange, but payment of a sum sufficient to
cover any tax or other governmental charge shall be required.
Consolidation, Merger or Sale by Northwest or NWA Corp.
Each indenture provides that neither Northwest nor NWA Corp. may merge or
consolidate with or into any other corporation or sell, convey, transfer,
lease or otherwise dispose of all or substantially all of its assets to any
person, unless:
. in the case of a merger or consolidation, Northwest or NWA Corp. is the
surviving corporation, as the case may be, or
. in the case of either a merger or consolidation where Northwest or NWA
Corp. is not the surviving corporation, or a sale, conveyance or other
disposition of all or substantially all of the assets of Northwest to
another person,
the resulting, successor or acquiring Person is a corporation
organized and existing under the laws of the United States of
America or any State thereof or the District of Columbia, and
that corporation expressly assumes by supplemental indenture all
the obligations of Northwest under the debt securities, any
related coupons and the indentures, or all the obligations of
NWA Corp. under the guarantee of NWA Corp. and the indentures,
as the case may be;
. immediately after giving effect to the merger or consolidation, or the
sale, conveyance, transfer, lease or other disposition (including,
without limitation, any debt directly or indirectly incurred or
anticipated to be incurred in connection with or in respect of that
transaction), no default or event of default under the indentures will
have occurred and be continuing; and
. certain other conditions are met.
If a successor corporation assumes the obligations of Northwest or NWA
Corp., then that successor corporation will succeed to and be substituted for
Northwest or NWA Corp. under the indentures and under the debt securities and
any related coupons or under the guarantee of NWA Corp., as the case may be,
and all obligations of Northwest or NWA Corp., as applicable, will terminate.
If any permitted consolidation, merger, sale, conveyance, disposition or
other change of control transaction (including a highly leveraged
transaction), the holders of the debt securities will not have the right to
require redemption of those debt securities or similar rights unless the
applicable prospectus supplement sets forth otherwise.
Events of Default, Notice and Certain Rights on Default
Events of default under the indenture for a series of debt securities are
defined as:
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. default for thirty days in payment of any interest on any debt security
of that series or any related coupon or any additional amount payable
with respect to debt securities of that series as specified in the
applicable prospectus supplement when due;
. default in payment of principal or premium, if any, on redemption or
otherwise, or in the making of a mandatory sinking fund payment of any
debt securities of that series when due;
. default for sixty days after notice to Northwest and NWA Corp. by the
trustee, or to Northwest, NWA Corp. and the trustee by the holders of
25% or more in aggregate principal amount of the outstanding debt
securities of that series, in the performance of any other agreement
applicable to the debt securities of that series, in the indenture or
in any supplemental indenture or board resolution under which the debt
securities of that series may have been issued; and
. certain events of bankruptcy, insolvency or reorganization of Northwest
or NWA Corp.
The applicable prospectus supplement will describe any other events of
default applicable to a specified series of debt securities. An event of
default with respect to a particular series of debt securities will not
necessarily be an event of default with respect to any other series of debt
securities.
If an event of default specified in the indenture for the debt securities
of any series occurs and is continuing, either the Trustee for that series or
the holders of 25% or more in aggregate principal amount of all of the
outstanding debt securities of that series, by written notice to Northwest
and NWA Corp., may
. declare the principal of all the debt securities of that series to be
due and payable or
. in the case of original issue discount debt securities or indexed debt
securities, declare the portion of the principal amount specified in
the applicable prospectus supplement to be due and payable.
If the holders of debt securities of a series give notice of the declaration
of acceleration to Northwest and NWA Corp., then they are also required to
give notice to the trustee for that series.
The trustee for any series of debt securities is required to give notice
to the holders of the debt securities of that series of all uncured defaults
within ninety days after the occurrence of a default known to it with respect
to debt securities of that series. However, that notice will not be given
until 60 days after the occurrence of a default with respect to debt
securities of that series involving a failure to perform a covenant other
than the obligation to pay principal, premium, if any, or interest, if any,
or make a mandatory sinking fund payment. In addition, the trustee may
withhold that notice if and so long as a committee of its responsible
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officers in good faith determines that withholding that notice is in the
interest of the holders of the debt securities of that series, except in the
case of a default in payment on the debt securities of that series. "Default"
means any event which is, or, after notice or passage of time or both, would
be, an event of default.
The trustee will be under no obligation to exercise any of its rights or
powers under the indentures at the request or direction of any of the holders
of debt securities, unless those holders have offered the trustee reasonable
indemnity. Subject to those provisions for indemnification of the trustee,
the holders of not less than a majority in aggregate principal amount of the
debt securities of each series affected (with each series voting as a class)
may direct the time, method and place of conducting any proceeding for any
remedy available to the trustee for that series, or exercising any trust or
power conferred on that trustee.
Each of NWA Corp. and Northwest will file annually with the trustee a
certificate as to its compliance with all conditions and covenants of the
applicable indenture.
The holders of not less than a majority in aggregate principal amount of
any series of debt securities by notice to the trustee for that series may
waive, on behalf of the holders of all debt securities of that series, any past
default or event of default with respect to that series and its consequences,
and may rescind and annul a declaration of acceleration with respect to that
series, unless a judgment or decree based on that acceleration has been
obtained and entered. However, a default or event of default in the payment
of the principal of, premium, if any, or interest, if any, on any debt
security (and any resulting acceleration) and certain other defaults may not
be waived.
Modification of the Indentures
Northwest, NWA Corp. and the trustee for a series of debt securities may
enter into one or more supplemental indentures, without the consent of the
holders of any of the debt securities, in order to:
. evidence the succession of another corporation to Northwest or NWA Corp.
and the assumption of the covenants of Northwest or NWA Corp. by a
successor;
. add to the covenants of Northwest or NWA Corp.or surrender any right or
power of Northwest or NWA Corp., and
. make the occurrence, or the occurrence and continuance, of a default in
any additional covenants, restrictions or conditions a default or an
event of default that permits the enforcement of all or any of the
remedies provided in the indentures.
However, in respect of any of those additional covenants, restrictions or
conditions, the supplemental indenture may:
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- provide for a particular period of grace after default, which
period may be shorter or longer than the period allowed in the
case of other defaults,
- provide for an immediate enforcement upon that default, or
- limit the remedies available to the Trustee upon that default;
. add additional events of default with respect to any series;
. add or change any provisions to permit or facilitate the issuance of
debt securities in bearer form or in global form;
. under certain circumstances, add, change or eliminate any provision
affecting debt securities not yet issued;
. secure the debt securities;
. add to the conditions, limitations and restrictions on the authorized
and restrictions to be observed after that addition;
. establish the form or terms of debt securities;
. evidence and provide for successor trustees;
. if allowed without penalty under applicable laws and regulations,
permit payment in respect of debt securities in bearer form in the
United States;
. correct or supplement any inconsistent provisions or add any other
provisions, on the condition that this action does not adversely affect
the interests of any holder of debt securities of any series issued
under the indentures in any material respect;
. cure any ambiguity or correct any mistake; or
. supplement any of the provisions of the indentures to permit or
facilitate the defeasance and discharge of any series of debt security,
on the condition that this action does not adversely affect the
interests of the holders of that series or any other series of debt
securities or any related coupons in any material respect.
In addition, Northwest, NWA Corp. and the trustee, with the consent of the
holders of not less than a majority in aggregate principal amount of the
outstanding debt securities of each series affected by the supplemental
indenture, may execute supplemental indentures adding any provisions to or
changing or eliminating any of the provisions of the indentures or any
supplemental indenture or modifying the rights of the holders of debt
securities of that series. However, no supplemental indenture may, without
the consent of the holder of each debt security that is affected,
. change the time for payment of principal or interest on any Debt
Security;
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. reduce the principal of, or any installment of principal of, or
interest on any Debt Security;
. reduce the amount of premium, if any, payable upon the redemption of
any Debt Security;
. reduce the amount of principal payable upon acceleration of the
maturity of an Original Issue Discount Debt Security;
. change the coin or currency in which any Debt Security or any premium
or interest is payable;
. impair the right to institute suit for the enforcement of any payment
on or with respect to any Debt Security;
. reduce the percentage in principal amount of the outstanding debt
securities of any series required to:
- consent to modify or amend the indentures,
- waive compliance with certain provisions of the indentures, or
- waive certain defaults;
. change the obligation of Northwest to maintain an office or agency in
the places and for the purposes specified in the indentures;
. modify the obligations of NWA Corp. to make payment under the guarantee
of NWA Corp.; or
. modify any of the foregoing provisions.
Defeasance
If the applicable prospectus supplement so indicates, Northwest may elect
either to:
. defease and be discharged from any and all obligations with respect to
the debt securities of or within any series, except as described below
("defeasance"), or
. be released from its obligations with respect to certain covenants
applicable to the debt securities of or within any series ("covenant
defeasance"),
when Northwest deposits, in trust for the above mentioned purpose, with the
trustee for that series of debt securities (or other qualifying trustee)
money and/or U.S. government obligations which through the payment of
principal and interest in accordance with their terms will provide money in
the amount sufficient to pay the principal of, premium, if any, and interest,
if any, on the debt securities to their stated maturity or redemption, as the
case may be, and any mandatory sinking fund or similar payments.
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When a defeasance occurs, Northwest will be deemed to:
. have paid and discharged the entire indebtedness represented by the
debt securities and any related coupons, and
. have satisfied all of its other obligations under the debt securities
and any related coupons.
However, Northwest will not be deemed to have satisfied:
. its obligations with respect to the rights of holders of the debt
securities to receive, solely from the trust funds deposited to defease
the debt securities, payments in respect of the principal of, premium,
if any, and interest, if any, on the debt securities or any related
coupons when the payments are due, and
. certain other obligations as provided in the indentures.
When a covenant defeasance occurs, Northwest will:
. be released only from its obligations to comply with certain covenants
contained in the indentures relating to the debt securities,
. continue to be obligated in all other respects under those debt
securities, and
. continue to be contingently liable with respect to the payment of
principal, premium, if any, and interest, if any, with respect to those
debt securities.
Unless the applicable prospectus supplement specifies otherwise and except
as described below, the conditions to both defeasance and covenant defeasance
are as follows:
. the defeasance or covenant defeasance must not result in a breach or
violation of, or constitute a default or event of default under, the
applicable indenture, or result in a breach or violation of, or
constitute a default under, any other material agreement or instrument
of Northwest or NWA Corp.;
. certain bankruptcy related defaults or events of default with respect
to Northwest or NWA Corp. must not have occurred and be continuing
during the period commencing on the date of the deposit of the trust
funds to defease the debt securities and ending on the 91st day after
that date;
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. Northwest must deliver to the trustee an opinion of counsel to the
effect that the holders of the debt securities:
- will not recognize income, gain or loss for Federal income tax
purposes as a result of the defeasance or covenant defeasance, and
- will be subject to Federal income tax on the same amounts and in
the same manner and at all the same times as would have been the
case if the defeasance or covenant defeasance had not occurred.
In the case of defeasance, the opinion of counsel must refer to and be
based upon a ruling of the Internal Revenue Service or a change in
applicable Federal income tax law occurring after the date of the
indentures;
. Northwest must deliver to the trustee an officers' certificate and
an opinion of counsel with respect to:
- compliance with the conditions precedent to the defeasance or
covenant defeasance, and
- certain registration requirements under the Investment Company
Act of 1940; and
. any additional conditions to the defeasance or covenant defeasance
which may be imposed on Northwest pursuant to the applicable indenture.
The indentures require that a nationally recognized firm of independent
public accountants deliver to the trustee a written certification as to the
sufficiency of the trust funds deposited for the defeasance or covenant
defeasance of the debt securities. Holders of the debt securities do not have
recourse against that firm under the indentures. If the applicable prospectus
supplement so indicates, in addition to obligations of the United States or
an agency or instrumentality of the United States, government obligations may
include obligations of the government or any agency or instrumentality of the
government issuing the currency in which debt securities of that series are
payable. If the government obligations deposited with the trustee for the
defeasance of the debt securities decrease in value or default subsequent to
their being deposited, Northwest will have no further obligation, and the
holders of the debt securities will have no additional recourse against
Northwest, as a result of the decrease in value or default. As described
above, in the event of a covenant defeasance, Northwest remains contingently
liable with respect to the payment of principal, premium, if any, and
interest, if any, with respect to the debt securities.
Northwest may exercise its defeasance option with respect to the debt
securities even if it has previously exercised its covenant defeasance
option.
If Northwest exercises its defeasance option, payment of the debt
securities may not be accelerated because of a default or an event of default.
If Northwest exercises its covenant defeasance option, payment of the debt
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securities may not be accelerated by reason of a Default or an Event of
Default with respect to the covenants to which the covenant defeasance is
applicable. However, if acceleration were to occur, the realizable value at
the acceleration date of the money and government obligations in the
defeasance trust could be less than the principal and interest then due on
the debt securities, because the required deposit in the defeasance trust is
based upon scheduled cash flow rather than market value, which will vary
depending upon interest rates and other factors.
The applicable prospectus supplement may further describe the provisions,
if any, applicable to defeasance or covenant defeasance with respect to debt
securities of a particular series.
The Trustee
Unless otherwise provided in the prospectus supplement for a series of
debt securities, State Street Bank and Trust Company is the trustee under the
indentures. Northwest and NWA Corp. also maintain banking and other
commercial relationships with State Street Bank and Trust Company and its
affiliates in the ordinary course of business and State Street Bank and Trust
Company acts as trustee under several other indentures for NWA Corp. and
Northwest.
DESCRIPTION OF WARRANTS
Northwest may issue warrants to purchase debt securities. Northwest may
issue warrants together with or separately from any debt securities offered by
any prospectus supplement and, if it issues warrants together with debt
securities, the warrants may be attached to or separate from the debt
securities. Northwest will issue the warrants under one or more separate
warrant agreements, all as set forth in the prospectus supplement relating to
the particular issue of warrants. A form of warrant agreement for warrants
sold attached to debt securities and a form of warrant agreement for warrants
sold alone have been filed with the SEC and are incorporated by reference as
exhibits to the registration statement of which this prospectus is a part.
The statements in this prospectus relating to the warrants and the warrant
agreements are summaries. You should refer to the warrant agreements for the
complete terms of the warrants and the warrant agreements.
General
If Northwest offers warrants, you should refer to the applicable
prospectus supplement which accompanies this prospectus for a description of
the specific terms of the warrants, including:
. the specific designation and aggregate number of the warrants;
. the offering price and the currency or composite currencies for which
the warrants may be purchased;
. the designation (including whether the debt securities are senior debt
securities or subordinated debt securities), aggregate principal amount,
currency or composite currencies and terms of the debt securities
purchasable upon exercise of the warrants;
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. if warrants are issued together with any debt securities,
- the designation and terms of the debt securities with which the
warrants are issued, and
- the number of warrants issued with the minimum denomination of each
Debt Security;
. if warrants are issued together with any debt securities, the date on
and after which the warrants and the related debt securities will be
separately transferable;
. the principal amount of debt securities purchasable upon exercise of
one warrant, and the price or the manner of determining the price and
currency or composite currencies or other consideration, which may
include debt securities, for which that principal amount of debt
securities may be purchased;
. the date on which the right to exercise the warrants will commence;
. the date on which the right to exercise warrants will expire (the
"expiration date");
. the terms of any mandatory or optional redemption by Northwest;
. certain Federal income tax consequences;
. whether the certificates for warrants will be issued in registered or
unregistered form; and
. any other special terms of the warrants.
Unless the applicable prospectus supplement specifies otherwise, the
warrants will not be listed on any securities exchange.
Holders of warrant certificates may exchange them for new warrant
certificates, may present them (if in registered form) for registration of
transfer and exchange, and may exercise them at an office or agency of the
warrant agent maintained for that purpose. No service charge will be made for
any transfer or exchange of warrant certificates, but Northwest may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection with the transfer or exchange. Prior to the exercise of
their warrants, holders of warrants will not have any of the rights of
holders of the debt securities that they may purchase upon the exercise of
the warrants. These rights include the right to receive payments of principal
of, premium, if any, or interest, if any, on the debt securities purchasable
upon the exercise or to enforce covenants in the indenture.
Exercise of Warrants
Each warrant will entitle its holder to purchase the principal amount of
debt securities
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. at the exercise price,
. for the consideration and
. during the period or periods, in each case as set forth in, or
calculable from, the prospectus supplement relating to the warrants.
Holders of warrants may exercise their warrants at any time during the
specified period up to 5:00 P.M. New York City time on the warrant expiration
date set forth in the applicable prospectus supplement. After the close of
business on the warrant expiration date, or a later date to which the warrant
expiration date may be extended by Northwest, unexercised warrants will
become void.
Holders of warrants may exercise their warrants by:
. paying the warrant agent the amount provided in the applicable
prospectus supplement required to purchase the debt securities
purchasable upon the exercise of the warrants, and
. providing the warrant agent with certain information set forth on the
reverse side of the warrant certificate.
Unless the applicable prospectus supplement specifies otherwise, when the
warrant agent receives the payment and the warrant certificate properly
completed and duly executed at the warrant agent office or any other office
or agency indicated in the applicable prospectus supplement, Northwest will,
as soon as practicable, issue and deliver the debt securities purchasable
upon the exercise. If fewer than all of the warrants represented by the
warrant certificate are exercised, a new warrant certificate will be issued
for the amount of unexercised warrants.
Modification of Warrant Agreements
Northwest and the warrant agent may supplement or amend the warrant
agreement, without the consent of any warrantholder, in order to:
. cure any ambiguity;
. correct or supplement any provision contained in the warrant agreement,
which may be defective or inconsistent with any other provisions; or
. make other provisions in regard to matters or questions arising under
the warrant agreement, which Northwest and the warrant agent may deem
necessary or desirable and which do not adversely affect the interests
of the warrantholders.
Global Warrants
Unless otherwise provided in a prospectus supplement for a series of
warrants, each series of warrants will be represented by one fully
registered global certificate. Each global certificate will be
. deposited with, or on behalf of, The Depository Trust Company ("DTC")
and registered in the name of Cede & Co. ("Cede"), or its nominee and
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. subject to the limitations and benefits described above under
"Description of the Debt Securities--Global Debt Securities" (except
that references to debt securities will be deemed references to
warrants).
Warrant Agent
Unless otherwise provided in the prospectus supplement for a series of
warrants, State Street Bank and Trust Company will act as the warrant agent
under the warrant agreement. Northwest and NWA Corp. maintain banking and
other commercial relationships with State Street Bank and Trust Company and
its affiliates in the ordinary course of business. The warrant agent will act
solely as an agent of Northwest in connection with the warrants and will not
assume any obligation or relationship of agency or trust for or with any
holders of warrants or beneficial owners of warrants.
PLAN OF DISTRIBUTION
Northwest may sell the offered securities in one or more of the following
ways from time to time:
. by or through underwriters,
. by itself directly to investors or other persons
. through dealers or agents or
. through a combination of any of these methods of sale.
The offered securities may be sold
. at a fixed price or prices, which may be changed,
. from time to time at market prices prevailing at the time of sale,
. at prices related to those market prices, or
. at negotiated prices.
The prospectus supplement relating to an offering of offered securities
will set forth the terms of that offering, including:
. the name or names of any underwriters, dealers or agents involved in
the offer and sale of the offered securities,
. any underwriting compensation paid by Northwest to underwriters,
dealers or agents in connection with the offering and any discounts,
concessions or commissions allowed by underwriters to participating
dealers,
. the purchase price of the offered securities and the proceeds to
Northwest from the sale,
. any delayed delivery arrangements,
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. the initial public offering price, and
. any securities exchanges on which the offered securities may be listed.
Dealer trading may take place in certain of the offered securities,
including offered securities not listed on any securities exchange. Any initial
public offering price and any discounts or commissions allowed or reallowed or
paid to dealers may change.
In connection with the sale of offered securities, underwriters may be
deemed to have received compensation from Northwest in the form of underwriting
discounts or commissions and may also receive commissions from purchasers of
offered securities for whom they may act as agent. Underwriters may sell
offered securities to or through dealers, and those dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions, which may be changed from time to time, from
the purchasers for whom they may act as agent.
If Northwest directly uses a dealer in the sale of offered securities,
Northwest will sell the offered securities to the dealer, as principal. The
dealer may then resell the offered securities to the public at varying prices
to be determined by the dealer at the time of resale. The applicable
prospectus supplement will set forth the terms of any of those sales.
Northwest may offer and sell offered securities through agents designated
by Northwest from time to time. The applicable prospectus supplement will set
forth any commissions payable by Northwest to the agent. Unless the
applicable prospectus indicates otherwise, the agent will be acting on a best
efforts basis for the period of its appointment.
Northwest may directly solicit offers to purchase offered securities and
sell them directly to institutional investors or others who may be deemed to be
underwriters within the meaning of the Securities Act of 1933 with respect to
any resale of the offered securities. The applicable prospectus supplement
will describe the terms of any of those sales.
Except as set forth in the applicable prospectus supplement, no director,
officer or employee of Northwest or NWA Corp. will solicit or receive a
commission in connection with direct sales by Northwest of the offered
securities, although these persons may respond to inquiries by potential
purchasers and perform ministerial and clerical work in connection with any
of these direct sales.
Underwriters, dealers and agents participating in the distribution of the
Offered Securities may be deemed to be underwriters, and any discounts and
commissions received by them and any profit realized by them on resale of the
Offered Securities may be deemed to be underwriting discounts and commissions
under the Securities Act of 1933.
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Underwriters, dealers and agents may be entitled, under agreements with
Northwest and NWA Corp., to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Securities Act of
1933 as a result of material misstatements and omissions. Underwriters,
dealers and agents may also be entitled to reimbursement by Northwest and NWA
Corp. for certain expenses. Underwriters, dealers and agents may engage in
transactions with, or perform services for, NWA Corp., Northwest and NWA
Corp.'s other subsidiaries in the ordinary course of business.
If the applicable prospectus supplement so indicates, we will authorize
agents, underwriters or dealers to solicit offers from institutions to
purchase securities from us at the public offering price indicated in the
prospectus supplement through delayed delivery contracts providing for
payment and delivery on a specified date in the future. The prospectus
supplement will specify the conditions of these contracts and the commission
payable for solicitation of the contracts.
If Northwest uses an underwriter or underwriters in the sale of any
Offered Securities, the applicable prospectus supplement will contain a
statement as to the underwriters' intention, if any, at the date of the
prospectus supplement to make a market in the Offered Securities. No assurances
can be given that there will be a market for the Offered Securities.
The applicable prospectus supplement will set forth the place and time of
delivery for the offered securities. Northwest will issue the debt securities
that are issuable upon exercise of warrants upon payment of the exercise
price and otherwise in accordance with the relevant terms applicable to the
warrants as described in the applicable prospectus supplement.
LEGAL OPINIONS
Unless the applicable prospectus supplement indicates otherwise, the
validity of the debt securities, the guarantee of NWA Corp. and warrants
offered by this prospectus will be passed upon for Northwest and NWA Corp.
by Simpson Thacher & Bartlett, New York, New York. In rendering that opinion,
Simpson Thacher & Bartlett will be relying as to matters of Minnesota law on an
opinion from the Office of the General Counsel of NWA Corp. and Northwest.
EXPERTS
Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements and schedule of NWA Corp. included in NWA Corp.'s Annual
Report on Form 10-K for the year ended December 31, 1999, as set forth in
their report on the consolidated financial statements and schedule
incorporated by reference in this prospectus. Such consolidated financial
statements and schedule are incorporated by reference in this prospectus in
reliance on Ernst & Young LLP's report, given on their authority as experts
in accounting and auditing.
___________
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SUBJECT TO COMPLETION, DATED , 2000
PROSPECTUS
$1,975,000,000
NORTHWEST AIRLINES, INC.
Pass Through Certificates
___________
Applicable Underlying Payments Fully and Unconditionally
Guaranteed by
NORTHWEST AIRLINES CORPORATION
___________
Northwest Airlines, Inc. may from time to time offer pass through
certificates. Pass through certificates may be issued in one or more
series in amounts, at prices and on terms to be determined at the time of the
offering.
The pass through certificates will represent interests in the assets of
one or more pass through trusts formed to finance the acquisition of specified
aircraft. The assets of the pass through trusts will include equipment notes
issued
(a) on a nonrecourse basis by one or more owner trustees pursuant to
separate leveraged lease transactions to finance or refinance a portion of
the cost of aircraft which have been or will be leased to Northwest
Airlines, Inc., or
(b) with recourse to Northwest Airlines, Inc. to finance all or a portion
of the cost of, or to purchase all or a portion of the outstanding debt with
respect to, aircraft which have been or will be purchased and owned by
Northwest Airlines, Inc.
The pass through certificates will not represent interests in or
obligations of Northwest Airlines, Inc. or any of its affiliates. Northwest
Airlines Corporation will fully and unconditionally guarantee the lease and
recourse obligations of Northwest Airlines, Inc. referred to above.
When we decide to sell a particular series of pass through certificates,
we will provide the specific terms of those certificates in a prospectus
supplement. You should read this prospectus and any prospectus supplement
carefully before you invest. This prospectus may not be used for sales of
pass through certificates unless accompanied by a prospectus supplement.
The pass through certificates may be sold to or through underwriters,
through dealers or agents or directly to purchasers. The prospectus supplement
will set forth the names of any underwriters, dealers or agents involved in the
sale of the pass through certificates in respect of which this prospectus is
being delivered, the proposed amounts, if any, to be purchased by
underwriters and the compensation, if any, of such underwriters or agents.
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The Securities and Exchange Commission and state securities regulators
have not approved or disapproved these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
___________
The date of this prospectus is , 2000
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TABLE OF CONTENTS
Page
About This Prospectus . . . . . . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Documents by Reference . . . . . . . . . . . . 3
Disclosure Regarding Forward-looking Statements . . . . . . . . . . . . 3
The Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
General Outline of Trust Structure . . . . . . . . . . . . . . . . . . . 4
Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Ratio of Earnings to Fixed Charges . . . . . . . . . . . . . . . . . . . 6
Description of the Certificates . . . . . . . . . . . . . . . . . . . . 7
Description of the Equipment Notes . . . . . . . . . . . . . . . . . . . 20
United States Federal Income Tax Consequences . . . . . . . . . . . . . 25
ERISA Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
You should rely only on the information provided in this prospectus and
any prospectus supplement, including the information incorporated by reference.
We have not authorized anyone to provide you with different information.
Northwest Airlines, Inc. will offer to sell the securities and seek offers to
buy the securities, only in jurisdictions where offers and sales are
permitted. The information contained in or incorporated by reference in this
prospectus is accurate only as of the date of this prospectus, regardless of
the time of delivery of this prospectus or of any sales of the securities.
ABOUT THIS PROSPECTUS
This prospectus is part of registration statements that we filed with the
Securities and Exchange utilizing a "shelf" registration process. Under this
shelf process, we may sell pass through certificates described in this
prospectus in one or more offerings up to a total dollar amount of
$1,975,000,000 or the equivalent of this amount in foreign currencies or
foreign currency units.
This prospectus provides you with a general description of the pass
through certificates we may offer. Each time we offer pass through
certificates, we will provide you with a prospectus supplement that will
describe the specific amounts, prices and terms of the offered securities.
The prospectus supplement may also add, update or change information contained
in this prospectus. You should read both this prospectus and any prospectus
supplement together with additional information described below under
"Incorporation of Certain Documents by Reference."
This prospectus does not contain all of the information in the
registration statements. Statements we make in this prospectus about the
contents of any contract, agreement or other document are not necessarily
complete. If that contract, agreement or other document has been filed as
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an exhibit to the registration statements, we refer you to the exhibit for a
more complete description. The information in this prospectus is accurate only
as of the date of this prospectus, regardless of the time of delivery of this
prospectus or any sale of the securities.
In this prospectus, "Northwest" refers to Northwest Airlines, Inc., "NWA
Corp." to Northwest Airlines Corporation and the "Company," "we," "us" or
"our" to NWA Corp. and its consolidated subsidiaries.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
NWA Corp. files annual, quarterly and current reports, proxy statements
and other information with the SEC. You may read and copy any document we file
at the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available
to the public over the internet at the SEC's web site at http://www.sec.gov.
Northwest is not required to file separate reports, proxy and information
statements or other information with the SEC pursuant to the Securities
Exchange Act of 1934. Instead, we have provided information with respect to
Northwest, to the extent required, in filings made by NWA Corp.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference
is considered to be a part of this prospectus, and information that we
file later with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed below and any
future filings made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of
the Securities Exchange Act of 1934 until we complete our offering of the
securities:
. Annual Report on Form 10-K for the year ended December 31, 1999;
. Quarterly Reports on Form 10-Q for the quarters ended March 31, 2000
and June 30, 2000; and
. Current Reports on Form 8-K filed on January 18, 2000 and
July 11, 2000.
You may request a copy of these filings (other than exhibits to them) at
no cost, by writing or telephoning us at the following address:
Secretary's Office
Northwest Airlines Corporation
5101 Northwest Drive, Dept. A1180
St. Paul, Minnesota 55111-3034
Telephone: (612) 726-2111
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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These forward-looking statements are subject to a
number of risks and uncertainties, all of which are difficult to predict and
many of which are beyond our control. Forward-looking statements are
typically identified by the words "may," "will," "believe," "expect,"
"anticipate," "intend," "estimate" and similar expressions. Actual results
could differ materially from those contemplated by these forward-looking
statements as a result of a number of factors. It is not reasonably possible
to itemize all of the many factors and specific events that could affect the
outlook of an airline operating in the global economy. Some factors that
could significantly impact expected capacity, load factors, revenues,
expenses and cash flows include the airline pricing environment, fuel costs,
labor negotiations both at the Company and other carriers, low-fare carrier
expansion, capacity decisions of other carriers, actions of the U.S. and
foreign governments, foreign currency exchange rate fluctuation, inflation,
the general economic environment in the U.S. and other regions of the world
and other factors discussed herein.
In light of these risks and uncertainties, we cannot assure you that the
results and events contemplated by the forward-looking statements contained
in this prospectus will in fact be realized. Potential investors should not
place undue reliance on these forward-looking statements. We do not undertake
any obligation to update or revise any forward-looking statements. All
subsequent written or oral forward-looking statements attributable to us or
persons acting on our behalf are expressly qualified in their entirety by the
factors described above.
THE COMPANY
NWA Corp. is the indirect parent corporation of Northwest. Northwest
operates the world's fourth largest airline (as measured by 1999 revenue
passenger miles ("RPMs")) and is engaged in the business of transporting
passengers and cargo. Northwest began operations in 1926 and its business
focuses on the development of a global airline network through its strategic
assets that include:
. domestic hubs at Detroit, Minneapolis/St. Paul and Memphis;
. an extensive Pacific route system with hubs at Tokyo and Osaka;
. a trans-Atlantic alliance with KLM Royal Dutch Airlines which operates
through a hub in Amsterdam; and
. a global alliance with Continental Airlines, Inc..
Northwest has developed strategies that are designed to utilize the
Company's strategic assets to its competitive advantage. These strategies focus
on providing safe, reliable, convenient and consistent air transportation. In
addition, the Company's frequent flyer program, customer service improvements
and targeted fare promotions are designed to maintain and improve its
competitive position.
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Northwest operates substantial domestic and international route networks
and directly serves more than 150 cities in 21 countries in North America, Asia
and Europe. Northwest had more than 56.1 million enplanements and flew over
74.2 billion RPMs in 1999.
Our principal executive offices are located at 2700 Lone Oak Parkway,
Eagan, Minnesota 55121; our mailing address is 5101 Northwest Drive, St. Paul,
Minnesota 55111-3034 and our telephone number is (612) 726-2111.
GENERAL OUTLINE OF TRUST STRUCTURE
A separate Northwest Airlines pass through trust will be formed for each
series or class of pass through certificates. Each pass through trust will
be formed pursuant to the basic pass through trust agreement (the form of
which has been filed with the SEC and is incorporated by reference in the
registration statement of which this prospectus is a part) and a trust
agreement supplement to be entered into among Northwest, NWA Corp. and State
Street Bank and Trust Company of Connecticut, National Association, as pass
through trustee under the pass through trust. Each pass through certificate
in a series or class will represent a fractional undivided interest in the
related pass through trust and will have no rights, benefits or interests in
respect of any other pass through trust. The property of each pass through
trust will consist of
. equipment notes issued
- on a nonrecourse basis by one or more owner trustees pursuant to
separate leveraged lease transactions to finance or refinance
a portion of the equipment cost of aircraft, including engines,
which have been or will be leased to Northwest pursuant to a
separate lease agreement for each leased aircraft (which we refer
to as "leased aircraft equipment notes"), or
- with recourse to Northwest to finance all or a portion of the
equipment cost of, or to purchase all or a portion of the
outstanding debt with respect to, aircraft, including engines which
have been or will be purchased and owned by Northwest (which we
refer to as "owned aircraft equipment notes");
. the rights of the pass through trust to acquire equipment notes
under a note purchase or refunding agreement;
. in the case of a delayed purchase of aircraft, the rights of the
pass through trust in respect of certain escrowed funds;
. if so specified in the related prospectus supplement, the rights of
the pass through trust under an intercreditor agreement with
respect to cross-subordination or other intercreditor matters;
. if so specified in the related prospectus supplement, monies
receivable under any liquidity facility arrangements for such pass
through trust; and
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. funds from time to time deposited with the related pass through
trustee.
At the time of execution and delivery of each trust agreement supplement,
the pass through trustee will enter into note purchase or refunding agreements
pursuant to which it will purchase one or more equipment notes relating to
the aircraft described in the applicable prospectus supplement. All equipment
notes that constitute the property of a pass through trust will have
identical interest rates (in each case equal to the rate applicable to the
pass through certificates issued by the pass through trust). The maturity
dates of the equipment notes acquired by each pass through trust will occur
on or before the final distribution date for the pass through certificates
issued by the pass through trust. The pass through trustee for a pass through
trust will distribute the amount of payments of principal, premium, if any,
and interest received by it as holder of the equipment notes to the pass
through certificateholders of the pass through trust. See "Description of the
Certificates" and "Description of the Equipment Notes."
Interest paid on the equipment notes held in a pass through trust will be
passed through to the holders of the pass through certificates of that pass
through trust on the dates and at the rate per annum set forth in the
applicable prospectus supplement until the final distribution date for that
pass through trust. Principal paid on the equipment notes held in a pass
through trust will be passed through to the holders of the pass through
certificates of that pass through trust in scheduled amounts on the dates set
forth in the applicable prospectus supplement until the final distribution
date for that pass through trust. The equipment notes issued with respect to
any aircraft will be secured by a security interest in that aircraft and, in
the case of leased aircraft equipment notes, by a security interest in the
related lease, including the right to receive rentals payable by Northwest.
The leased aircraft equipment notes will be issued under separate trust
indentures between a bank, trust company or other institution specified in
the related prospectus supplement, as loan trustee, and an institution
specified in the related prospectus supplement acting, not in its individual
capacity, but solely as owner trustee of a separate trust for the benefit of
one or more institutional investors which are owner participants. With
respect to each leased aircraft, the related owner participant(s) will
provide from sources other than the equipment notes, a portion of the
equipment cost of that aircraft. No owner participant, however, will be
personally liable for any amount payable under the equipment notes (or the
equipment note indenture under which they were issued). Simultaneously with
the acquisition of each leased aircraft by an owner trust, the owner trustee
will lease that aircraft to Northwest pursuant to a separate lease. Although
the leased aircraft equipment notes will be issued by an owner trust and will
not be direct obligations of, or guaranteed by, Northwest, the amounts
unconditionally payable by Northwest under the lease will be sufficient to
pay in full when due all payments required to be made on the corresponding
equipment notes.
The owned aircraft equipment notes will be issued under separate
equipment note indentures between a loan trustee and Northwest.
NWA Corp. will fully and unconditionally guarantee to the holders from
time to time of pass through certificates
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. with respect to owned aircraft equipment notes, the full and prompt
payment of principal, premium, if any, and interest on those equipment
notes when and as the same shall become due and payable, whether at
maturity, upon redemption or otherwise and
. with respect to leased aircraft equipment notes, the full and prompt
payment of all amounts payable by Northwest under the related lease
when and as the same shall become due and payable.
NWA Corp.'s guarantee will be enforceable without any need first to enforce
the obligations of Northwest against Northwest.
With respect to equipment notes of differing payment priorities issued in
respect of one or more aircraft, which will be purchased by separate pass
through trusts, the rights of the holders of the pass through certificates
will be subject to an intercreditor agreement.
USE OF PROCEEDS
Except as set forth in a prospectus supplement for a specific offering of
pass through certificates, the proceeds from the sale of the pass through
certificates will be used by the pass through trustee(s) to purchase leased
aircraft equipment notes and owned aircraft equipment notes.
Any portion of the proceeds from the sale of pass through certificates not
used by the pass through trustee to purchase equipment notes on or prior to
the date specified in the applicable prospectus supplement will be
distributed on a special distribution date to the pass through
certificateholders, together with interest, but without premium. See
"Description of Certificates--Special Distribution Upon Unavailability of
Aircraft."
RATIO OF EARNINGS TO FIXED CHARGES
We have set forth below the ratio of earnings to fixed charges for NWA
Corp. and its consolidated subsidiaries for the periods indicated. The ratio of
earnings to fixed charges represents the number of times that fixed charges
were covered by earnings. In computing the ratio, earnings represent
consolidated earnings (loss) before income taxes, cumulative effect of
accounting change and fixed charges (excluding capitalized interest). Fixed
charges consist of interest expense (including capitalized interest), one-
third of rental expense, which is considered representative of the interest
factor, and amortization of debt discount and expense.
Year ended December 31, Six months ended June 30,
------------------------------------ ------------------------
1999 1998 1997 1996 1995 2000 1999
------ ------ ------ ------ ------ ------ ------
1.64 (a) 3.05 2.74 1.90 1.43 1.36
___________
(a) Earnings were inadequate to cover fixed charges by $452 million for
the year ended December 31, 1998.
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DESCRIPTION OF THE CERTIFICATES
The following description of the pass through certificates summarizes
certain general terms and provisions of the pass through certificates to which
any prospectus supplement may relate. This summary relates to the basic pass
through trust agreement (the form of which has been filed with the SEC and is
incorporated by reference in the registration statement of which this
prospectus is a part) and each of the trust agreement supplements, the pass
through trusts to be formed thereby and the pass through certificates to be
issued by each pass through trust except to the extent, if any, described in
the applicable prospectus supplement. The prospectus supplement that
accompanies this prospectus contains a glossary of the material terms used
with respect to the specific series or class of pass through certificates
being offered thereby. The trust agreement supplement relating to each
series or class of pass through certificates and the forms of the material
operative agreements relating thereto (including, if applicable,
note purchase or refunding agreement, equipment note indenture, lease, trust
agreement, participation agreement, intercreditor agreement and liquidity
arrangement) will be filed as exhibits to a post-effective amendment to the
Registration Statement of which this prospectus is a part, a Current Report
on Form 8-K, a Quarterly Report on Form 10-Q or an Annual Report on Form 10-
K, as applicable, filed by NWA Corp. with the SEC.
The pass through certificates offered pursuant to this prospectus will be
limited to $1,500,000,000 aggregate public offering price (or its equivalent
(based on the applicable exchange rate at the time of sale) in one or more
foreign currencies or currency units).
To the extent that any provision in any prospectus supplement is
inconsistent with any provision in this summary, the provision of such
prospectus supplement will control.
General
Each pass through certificate will represent a fractional undivided
interest in the pass through trust created by a trust agreement supplement. All
payments and distributions on account of the pass through certificates will
be made only from the related trust property (see "General Outline of Trust
Structure"). Each pass through certificate will represent a pro rata share of
the outstanding principal amount of the equipment notes held in the related
pass through trust. Unless otherwise specified in the applicable prospectus
supplement, each pass through certificate will be issued in minimum
denominations of $1,000 or any integral multiple thereof (except that one
pass through certificate of each pass through trust may be issued in an odd
amount, due to the fact that the aggregate amount offered by such pass
through trust may not represent an integral multiple of $1,000).
The pass through certificates will not represent an interest in or
obligation of Northwest, NWA Corp., the trustee, any of the loan trustees or
owner trustees in their individual capacities, any owner participant, or any
affiliate of any thereof. Each pass through certificateholder by its
acceptance of a pass through certificate agrees to look solely to the income
and proceeds from the trust property as provided in the basic pass through
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trust agreement and the applicable trust agreement supplement and to its
rights under NWA Corp.'s guarantee.
The equipment notes issued under an equipment note indenture may be held
in more than one pass through trust. Similarly, one pass through trust may
hold equipment notes issued under more than one equipment note indenture. If a
pass through trust holds more than one equipment note, we refer to the
equipment note indentures under which those equipment notes were issued as
"related equipment note indentures". Unless otherwise provided in a
prospectus supplement, only equipment notes having the same priority of
payment, also called a "class" or "series" of equipment notes, may be held in
the same pass through trust.
Interest will be passed through to pass through certificateholders of each
pass through trust at the rate per annum payable on the equipment notes held
in such pass through trust, as set forth for such pass through trust on the
cover page of the applicable prospectus supplement.
Reference is made to the prospectus supplement that accompanies this
prospectus for a description of the specific series or class of pass through
certificates being offered thereby, including:
. the specific designation and title of the pass through certificates;
. the regular distribution dates (as defined below) and special
distribution dates applicable to the pass through certificates;
. the currency or currencies (including currency units) in which such
pass through certificates may be denominated;
. the specific form of the pass through certificates, including whether
or not the pass through certificates are to be issued in accordance
with a book-entry system;
. a description of the equipment notes to be purchased by the pass
through trust, including
- the period or periods within which, the price or prices at which,
and the terms and conditions upon which the equipment notes may or
must be redeemed or defeased in whole or in part, by Northwest or,
with respect to leased aircraft equipment notes, the owner trustee
which is the issuer,
- the payment priority of the equipment notes in relation to any
other equipment notes issued with respect to the related aircraft,
- any additional security or liquidity enhancements therefor and
- any intercreditor or other rights or limitations between or among
the holders of equipment notes of different priorities issued by
the same owner trustee;
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. a description of the related aircraft, including whether the aircraft
is leased to or owned by Northwest;
. a description of the note purchase or refunding agreement and of the
equipment note indentures, including a description of the indenture
events of default, the remedies exercisable upon the occurrence of
indenture events of default and any limitations on the exercise of
those remedies;
. if the pass through certificates relate to leased aircraft equipment
notes, a description of the lease, the owner trust agreement and
participation agreement, including the name of the owner trustee, a
description of the lease events of default, the remedies exercisable
upon the occurrence of lease events of default and any limitations
on the exercise of those remedies, and the rights of the owner trustee,
if any, and/or owner participant, if any, to cure failures of Northwest
to pay rent under the lease;
. the extent, if any, to which the provisions of the operative documents
applicable to the equipment notes may be amended without the consent
of the holders of, or only upon the consent of the holders of a
specified percentage of aggregate principal amount of, the equipment
notes;
. cross-default or cross-collateralization provisions in the equipment
note indentures;
. subordination provisions among the holders of pass through
certificates, including any cross-subordination provisions among the
holders of pass through certificates in separate pass through trusts;
and
. any other special terms pertaining to such pass through certificates.
If any pass through certificates are denominated in one or more foreign
currencies or currency units, the restrictions, certain United States federal
income tax considerations, specific terms and other information with respect
to those pass through certificates and the foreign currency or currency units
will be set forth in the applicable prospectus supplement.
Book-Entry Registration
General
Unless otherwise specified in the applicable prospectus supplement, each
series or class of pass through certificates will be represented by one fully
registered global certificate. Each global certificate will be deposited
with, or on behalf of, The Depository Trust Company ("DTC") and registered in
the name of Cede & Co. ("Cede"), or its nominee. No person acquiring a
beneficial interest in a global pass through certificate will be entitled to
physical delivery of a definitive certificate except as set forth below
under "--Definitive Certificates."
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Unless and until definitive pass through certificates are issued, all
references to actions by pass through certificateholders refer to actions
taken by DTC, or its nominee, as the registered holder of the global pass
through certificate, upon instructions from DTC Participants (as defined
below), and all references to distributions, notices, reports and statements
to pass through certificateholders refer, as the case may be, to
distributions, notices, reports and statements to DTC or its nominee, as the
registered holder of the pass through certificates, or to DTC Participants
for distribution to the beneficial owners of interests in the global pass
through certificates in accordance with DTC procedures. Unless and until
definitive certificates are issued, the only "Certificateholder" will be
Cede, as nominee of DTC. Beneficial owners will not be recognized by the pass
through trustee as pass through certificateholders, as such term is used in
the pass through trust agreement, and beneficial owners will be permitted to
exercise the rights of pass through certificateholders only indirectly
through DTC and DTC Participants.
Northwest has been advised that DTC is a limited purpose trust company
organized under the laws of the State of New York, a member of the Federal
Reserve System, a "clearing corporation" within the meaning of the New York
Uniform Commercial Code and "clearing agency" registered pursuant to
section 17A of the Exchange Act. DTC was created to hold securities for its
participants ("DTC Participants") and to facilitate the clearance and
settlement of securities transactions between DTC Participants through
electronic book-entries, thereby eliminating the need for physical transfer
of certificates. DTC Participants include securities brokers and dealers,
banks, trust companies and clearing corporations. Indirect access to the DTC
system also is available to others such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a DTC
Participant either directly or indirectly ("Indirect Participants").
Purchases, sales and transfers of the ownership of, or other interests in,
the pass through certificates must be made by or through DTC Participants and
Indirect Participants, which will receive a credit for the pass through
certificates on DTC's record. The ownership interest of each beneficial
owner of the pass through certificates is in turn recorded on the Direct
Participant's and Indirect Participant's records.
DTC has advised Northwest that it will take any action permitted to be
taken by a pass through certificateholder under the basic pass through trust
agreement only at the direction of one or more DTC Participants to whose
accounts with DTC the pass through certificates are credited. Additionally,
DTC has advised Northwest that in the event any action requires approval by
pass through certificateholders of a certain percentage of beneficial
interest in each pass through trust, DTC will take such action only at the
direction of and on behalf of DTC Participants whose holders include
undivided interests that satisfy any such percentage. DTC may take
conflicting actions with respect to other undivided interests to the extent
that such actions are taken on behalf of DTC Participants whose holders
include such undivided interests.
Distributions of principal and interest on the global pass through
certificates will be made by the pass through trustee to CEDE, as nominee for
DTC. DTC will forward such payments in same-day funds to DTC Participants who
are credited with ownership of the pass through certificates in amounts
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proportionate to the principal amount of the DTC Participant's respective
holdings of beneficial interests in the pass through certificates. DTC
Participants will thereafter forward payments to Indirect Participants or
beneficial owners, as the case may be, in accordance with customary industry
practices. The forwarding of distributions to the pass through certificate
beneficial owners will be the responsibility of the DTC Participants.
Under the rules, regulations and procedures creating and affecting DTC and
its operations (the "Rules"), DTC is required to make book-entry transfers of
the pass through certificates among DTC Participants on whose behalf it acts
with respect to the pass through certificates and to receive and transmit
distributions of principal, premium, if any, and interest with respect to the
pass through certificates. DTC Participants and Indirect Participants with
which beneficial owners of the pass through certificates have accounts
similarly are required to make book-entry transfers and receive and transmit
such payments on behalf of their respective customers. Accordingly, although
beneficial owners of pass through certificates will not possess the pass
through certificates, the Rules provide a mechanism by which the beneficial
owners will receive payments and will be able to transfer their interests.
Because DTC can only act on behalf of DTC Participants, who in turn act on
behalf of Indirect Participants, the ability of a beneficial owner of pass
through certificates to pledge its pass through certificates to persons or
entities that do not participate in the DTC system, or to otherwise act with
respect to such pass through certificates, may be limited due to the lack of
a physical certificate for such pass through certificates.
Neither Northwest, NWA Corp. nor the Trustee will have any liability for
any aspect of the records relating to or payments made on account of beneficial
ownership interests in the pass through certificates held by Cede, as nominee
for DTC, or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
The applicable prospectus supplement will specify any additional
book-entry registration procedures applicable to pass through certificates
denominated in a currency other than United States dollars.
Same-Day Settlement and Payment
So long as the pass through certificates are registered in the name of
Cede, as nominee for DTC, all payments made by Northwest to the loan trustee
under any equipment note indenture will be in immediately available funds. Such
payments, including the final distribution of principal with respect to the
pass through certificates of any pass through trust, will be passed through
to DTC in immediately available funds.
Secondary trading in long-term notes and debentures of corporate issuers
is generally settled in clearinghouse or next-day funds. In contrast, secondary
trading in pass through certificates is generally settled in immediately
available or same-day funds. Any pass through certificates registered in the
name of Cede, as nominee for DTC, will trade in DTC's Same-Day Funds
Settlement System until maturity, and secondary market trading activity in
the pass through certificates will therefore be required by DTC to settle in
immediately available funds. No assurance can be given as to the effect, if
any, of settlement in same-day funds on trading activity in the pass through
certificates.
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Definitive Certificates
Unless the applicable prospectus supplement specifies otherwise, if DTC is
at any time unwilling or unable to continue as depositary and a successor
depositary is not appointed by Northwest within ninety days, pass through
certificates in definitive, certificated form will be issued in exchange for
the applicable global pass through certificates. In addition, Northwest may
at any time and in its sole discretion determine not to have any of the pass
through certificates of a series or class represented by one or more global
certificates. In that event, pass through certificates in definitive
certificated form will be issued in exchange for the applicable global pass
through certificates. Further, if Northwest so specifies, an owner of a
beneficial interest in a global pass through certificate may, on terms
acceptable to Northwest and DTC, receive definitive, certificated pass
through certificates registered in the name of that beneficial owner or its
designee.
Upon the occurrence of any event described in the immediately preceding
paragraph, the pass through trustee will be required to notify all beneficial
owners through DTC Participants of the availability of definitive
certificates. Upon surrender by DTC of the certificates representing the pass
through certificates and receipt of instructions for re-registration, the
pass through trustee will reissue the pass through certificates as definitive
pass through certificates to the beneficial owners.
Distributions of principal, premium, if any, and interest on pass through
certificates will thereafter be made by the pass through trustee directly in
accordance with the procedures set forth in the basic pass through trust
agreement and the applicable trust agreement supplement, to holders in whose
names the definitive pass through certificates were registered at the close
of business on the applicable record date. These distributions will be made
by check mailed to the address of the holder as it appears on the register
maintained by the pass through trustee. The final payment on any pass through
certificate, however, will be made only upon presentation and surrender of
the definitive pass through certificate at the office or agency specified in
the notice of final distribution to pass through certificateholders.
Definitive pass through certificates will be freely transferable and
exchangeable at the office of the pass through trustee upon compliance with
the requirements set forth in the basic pass through trust agreement and the
applicable trust agreement supplements. No service charge will be imposed for
any registration of transfer or exchange, but payment of a sum sufficient to
cover any tax or other governmental charge shall be required.
Payments and Distributions
Payments of principal of and premium, if any, and interest on to the
equipment notes held in each pass through trust will be distributed by the
pass through trustee, upon receipt, to the pass through certificateholders of
that pass through trust on the dates and in the currency specified in the
applicable prospectus supplement, except
. in certain cases when some or all of those equipment notes are in
default as described in the applicable prospectus supplement and
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. that those payments are subject to the effect of any
cross-subordination or other intercreditor provisions set forth in
the prospectus supplement for a series or class of pass through
certificates.
Scheduled payments of principal of, and interest on, the unpaid principal
amount of the equipment notes held in each pass through trust will be
scheduled to be received by the pass through trustee on the regular
distribution dates specified in the applicable prospectus supplement. See
"Description of the Equipment Notes General." Subject to the effect of any
cross-subordination or other intercreditor provisions set forth in the
prospectus supplement for a series or class of pass through certificates,
each pass through certificateholder of each pass through trust will be
entitled to receive a pro rata share of any distribution in respect of
scheduled payments of principal and interest made on the equipment notes held
in the pass through trust.
Payments of principal, premium, if any, and interest received by a pass
through trustee on account of the early redemption, if any, of the equipment
notes held in the pass through trust will be distributed on the special
distribution dates provided in the applicable prospectus supplement. In
addition, payments (other than scheduled payments received on a regular
distribution date) received by a pass through trustee following a default
under the equipment notes held in the pass through trust will be distributed
on a special distribution date. However, unless otherwise specified in the
applicable prospectus supplement, following a default under the equipment
notes held in a pass through trust, payments received by the pass through
trustee as a result of a drawing on a regular distribution date under any
liquidity facility specified in the applicable prospectus supplement will be
distributed on such regular distribution date. The pass through trustee will
mail notice to the pass through certificateholders of record of the
applicable pass through trust not less than 20 days prior to the special
distribution date on which any payment is to be distributed by the pass
through trustee.
Pool Factors
The pool factor (as defined below) for a pass through trust will decline
in proportion to the scheduled repayments of principal on the equipment notes
held in that pass through trust as described in the applicable prospectus
supplement unless there has been
. an early redemption,
. a purchase of an issue of leased aircraft equipment notes by the owner
trustee after an indenture default,
. a default in the payment of principal in respect of one or more issues
of the equipment notes held in a pass through trust or
. certain actions have been taken following a default thereon, as
described in the applicable prospectus supplement,
in which event the pool factor and the pool balance (as defined below) of
each pass through trust so affected will be recomputed after giving effect to
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these events and notice thereof will be mailed to the pass through
certificateholders of the pass through trust. Each pass through trust will
have a separate pool factor.
Unless otherwise described in the applicable prospectus supplement, the
"pool balance" for each pass through trust or for the pass through certificates
issued by any pass through trust indicates, as of any date, the original
aggregate face amount of the pass through certificates of such pass through
trust less the aggregate amount of all payments made in respect of the pass
through certificates of such pass through 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 a pass through trust
as of any distribution date will be computed after giving effect to any
payments on the equipment notes or other trust property held in that pass
through trust and the distribution thereof to be made on that date.
Unless otherwise described in the applicable prospectus supplement, the
"pool factor" for a pass through trust as of any distribution date is the
quotient (rounded to the seventh decimal place) computed by dividing
. the pool balance by
. the aggregate original principal amount of the equipment notes held in
that pass through trust.
The pool factor for a pass through trust as of any distribution date will be
computed after giving effect to the payment of principal, if any, on the
equipment notes held in that pass through trust and distribution thereof to
be made on that date. The pool factor for each pass through trust will
initially be 1.0000000. Thereafter, the pool factor for a pass through trust
will decline as described above to reflect reductions in the pool balance of
that pass through trust. The amount of a pass through certificateholder's pro
rata share of the pool balance of a pass through trust can be determined by
multiplying the original denomination of the holder's pass through
certificate by the pool factor for the pass through trust as of the
applicable distribution date. The pool factor and the pool balance for a pass
through trust will be mailed to pass through certificateholders of that pass
through trust on each distribution date.
Reports to Certificateholders
On each distribution date, the pass through trustee will deliver to the
pass through certificateholders of the related pass through trust, a statement,
giving effect to the distribution to be made on that distribution date,
setting forth the following information:
. the amount of the distribution that is allocable to principal and the
amount allocable to premium, if any (per $1,000 aggregate principal
amount of pass through certificate);
. the amount of the distribution that is allocable to interest (per
$1,000 aggregate principal amount of pass through certificate) below;
and
. the pool balance and the pool factor for the pass through trust.
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If so specified in the related prospectus supplement, the pass through
trustee for a series or class of pass through certificates may include in
this statement additional information, such as
. the aggregate amount of funds distributed on the distribution date and
the source of such funds and
. in the case of a delayed purchase, certain information regarding any
escrowed funds.
So long as the pass through certificates are registered in the name of
Cede, as nominee for DTC, on the record date prior to each distribution date,
the pass through trustee will request from DTC a Securities Position Listing
setting forth the names of all DTC Participants reflected on DTC's books as
holding interests in the pass through certificates on such record date. On
each distribution date, the pass through trustee will mail to each DTC
Participant the statement described above and will make available additional
copies as requested by a DTC Participant for forwarding to holders of
beneficial interests in the pass through certificates.
In addition, after the end of each calendar year, the pass through trustee
will prepare for each person which was a pass through certificateholder at
any time during the preceding calendar year, a report containing the sum of
the amounts determined pursuant to the first two bullets above for that
calendar year or, in the event such person was a pass through
certificateholder during only a portion of that calendar year, for the
applicable portion of the calendar year. In addition, after the end of each
calendar year, the pass through trustee will prepare for each person which
was a pass through certificateholder at any time during the preceding
calendar year, such other items as are readily available to the pass through
trustee and which a pass through certificateholder reasonably requests as
necessary for the preparation of its federal income tax returns. Such report
and such other items will be prepared on the basis of information supplied to
the pass through trustee by the DTC Participants and will be delivered by the
pass through trustee to the DTC Participants to be available for forwarding
by the DTC Participants to holders of beneficial interests in the pass
through certificates in the manner described above.
If at any time the pass through certificates are issued in the form of
definitive certificates, the pass through trustee will prepare and deliver
the information described above to each pass through certificateholder of
record as the name and period of beneficial ownership of such pass through
certificateholder appears on the records of the registrar of the pass through
certificates.
Voting of Equipment Notes
Subject to the effect of any cross-subordination provisions set forth in
the related prospectus supplement, a pass through trustee, as holder of the
equipment notes held in the pass through trust, has the right to vote and
give consents and waivers under the equipment note indentures. The basic pass
through trust agreement and related trust agreement supplement set forth
. the circumstances in which the pass through trustee may direct any
action or cast any vote as the holder of the equipment notes held in
the applicable pass through trust at its own discretion,
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. the circumstances in which the pass through trustee must seek
instructions from the pass through certificateholders, and
. the percentage of pass through certificateholders required to direct
the pass through trustee to take any action.
If specified in the related prospectus supplement, the right of a pass
through trustee to vote and give consents and waivers with respect to the
equipment notes held in the related pass through trust may, in the
circumstances set forth in the intercreditor agreement, be exercisable by
another person specified in the prospectus supplement.
Events of Default and Certain Rights Upon an Event of Default
The prospectus supplement related to a series or class of pass through
certificates will specify the events of default under the pass through trust
agreement and the events of default under the equipment note indentures. With
respect to leased aircraft equipment notes, the indenture events of defaults
will include events of default under the related lease. With respect to any
equipment notes which are supported by a liquidity facility, the indenture
events of default may include events of default under the liquidity facility.
Unless otherwise provided in a prospectus supplement, all of the equipment
notes issued under the same equipment note indenture will relate to one or
more specific aircraft and there will be no cross-collateralization or
cross-default provisions in the equipment note indentures. Events resulting
in an event of default under any particular equipment note indenture will not
necessarily result in an event of default under any other equipment note
indenture.
As described below under "--Cross-Subordination Issues," a prospectus
supplement may provide the terms of any cross-subordination provisions among
pass through trusts which hold separate, but related equipment notes. If
these provisions are provided, payments made under an equipment note
indenture under which an event of default has not occurred (and as to which
payments continue to be made as scheduled) may be distributed first to the
holders of the pass through certificates issued under the pass through trust
which holds the most senior equipment notes issued under all related
equipment note indentures.
With respect to leased aircraft equipment notes, the ability of the owner
trustee or owner participant to cure indenture events of default, including
indenture events of default that result from the occurrence of a lease event
of default, will be described in the prospectus supplement. Unless otherwise
provided in a prospectus supplement, a drawing under a liquidity facility for
the purpose of making a payment of interest as a result of the failure by
Northwest to have made a corresponding payment under the equipment notes or
leases, as applicable, will not cure an indenture event of default related to
such failure by Northwest.
The prospectus supplement related to a series or class of pass through
certificates will set forth the percentage of pass through certificateholders
entitled to direct the pass through trustee to take any action under the
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equipment notes held in the pass through trust and, if applicable, equipment
notes issued under any other related equipment note indenture. If the
equipment notes outstanding under an equipment note indenture are held by
more than one pass through trust, then the ability of the pass through
certificateholders in any one pass through trust to cause the loan trustee
for the equipment notes held in that pass through trust to accelerate those
equipment notes or to direct the exercise of remedies by the loan trustee
under the equipment note indenture will depend, in part, upon the proportion
between the aggregate principal amount of the equipment notes held in that
pass through trust and the aggregate principal amount of all equipment notes
outstanding under the same equipment note indenture. In addition, if cross-
subordination provisions are applicable to any series or class of pass
through certificates, then the ability of the pass through certificateholders
of any one pass through trust to cause the loan trustee for the equipment
notes held in that pass through trust to accelerate those equipment notes or
to direct the exercise of remedies by the loan trustee under the equipment
note indenture will depend, in part, upon the class or series of equipment
notes held in that pass through trust.
If the equipment notes outstanding under an equipment note indenture are
held by more than one pass through trust, then each pass through trust will
hold equipment notes with different terms from the equipment notes held in the
other pass through trusts and therefore the pass through certificateholders
of a pass through trust may have divergent or conflicting interests from
those of the pass through certificateholders of the other pass through trusts
holding equipment notes relating to the same equipment note indenture. In
addition, so long as the same institution acts as pass through trustee of
each pass through trust, in the absence of instructions from the pass through
certificateholders of any such pass through trust, the pass through trustee
for such pass through trust could for the same reason be faced with a
potential conflict of interest upon an indenture event of default. In such
event, the pass through trustee has indicated that it would resign as pass
through trustee of one or all such pass through trusts, and a successor
trustee would be appointed in accordance with the terms of the basic pass
through trust agreement.
The prospectus supplement for a series or class of pass through
certificates will specify whether and under what circumstances the pass through
trustee may or must sell for cash all or part of the equipment notes. Any
proceeds received by the pass through trustee upon any equipment note sale
will be deposited in a special payments account established by the pass through
trustee for the benefit of the pass through certificateholders of the related
pass through trust. The market for equipment notes in default may be very
limited, and there can be no assurance that they could be sold for a
reasonable price. Furthermore, so long as the same institution acts as pass
through trustee of multiple pass through trusts, it may be faced with a
conflict in deciding from which pass through trust to sell equipment notes to
available buyers. If the pass through trustee sells any equipment notes for
less than their outstanding principal amount, the pass through
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certificateholders of the related pass through trust will receive a smaller
amount of principal distributions than anticipated and will not have any
claim for the shortfall against Northwest, any owner trustee, owner
participant, the pass through trustee or (except for NWA Corp.'s guarantee)
their affiliates. Furthermore, neither the pass through trustee nor the pass
through certificateholders of a pass through trust could take any action with
respect to any remaining equipment notes held in that pass through trust so
long as no indenture event of defaults exist with respect to those remaining
equipment notes.
With respect to any pass through trust, the following amounts will be
deposited into the special payments account and distributed to the related
pass through certificateholders on a special payments date:
. Any amount (other than scheduled payments received on a regular
distribution date) distributed to the pass through trustee by the loan
trustee under the related equipment note indenture following an
indenture event of default.
. If a prospectus supplement provides that the applicable owner trustee
may, under circumstances specified therein, redeem or purchase the
related equipment notes, the price paid by the owner trustee to the
pass through trustee for those equipment notes.
Any funds held by a pass through trustee in the special payments account
for the related pass through trust which represent payments on account of
equipment notes which are in default, or the proceeds from the sale by the
pass through trustee of any equipment notes held in the trust, will, to the
extent practicable, be invested and reinvested by the pass through trustee in
certain permitted investments specified in the related prospectus supplement.
The basic pass through trust agreement provides that the pass through
trustee will, within 90 days after the occurrence of a pass through trust
default, give the related pass through certificateholders notice, transmitted
by mail, of all uncured or unwaived pass through trust defaults known to it.
However, the pass through trustee will be protected in withholding notice of
any pass through trust default, other than default in the payment of principal,
premium, if any, or interest on any of the equipment notes held in the pass
through trust, if it in good faith determines that the withholding of notice
is in the interests of the pass through certificateholders. The term
"default" as used in this paragraph means the occurrence of an event of
default with respect to a pass through trust as described above, except that
in determining whether any event of default has occurred, any grace period or
notice requirement will be disregarded.
The basic pass through trust agreement contains a provision entitling the
pass through trustee of a pass through trust, subject to the duty of the pass
through trustee during a default to act with the required standard of care,
to be offered reasonable security or indemnity by the pass through
certificateholders of that pass through trust before proceeding to exercise
any right or power under the basic pass through trust agreement at the
request of the pass through certificateholders.
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The prospectus supplement for a series or class of pass through
certificates will specify the percentage of pass through certificateholders
entitled to waive, or to instruct the pass through trustee to waive, any past
event of default under the pass through certificates and thereby annul any
direction given as a result of that event. The prospectus supplement for a
series or class of pass through certificates will also specify the percentage
of pass through certificateholders (and whether of such pass through trust or
of any other pass through trust holding equipment notes issued under related
equipment note indentures) entitled to waive, or to instruct the pass through
trustee or the loan trustee to waive, any past indenture event of default
under the equipment notes held in that pass through trust and thereby annul
any direction given as a result of that event.
Merger, Consolidation and Transfer of Assets
Northwest will be prohibited from consolidating with or merging into any
other corporation or transferring substantially all of its assets as an
entirety to any other corporation unless
. the surviving successor or transferee corporation (a) is a "citizen
of the United States" (as defined in Section 40102(a)(15) of Title 49
of the United States Code) 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 10 or
more individuals or 6,000 pounds or more of cargo and with respect to
which there is in force an air carrier operating certificate issued
pursuant to Part 121 of the regulations under the sections of Title 49,
United States Code, relating to aviation and (b) expressly assume all
of the obligations of Northwest contained in the basic pass through
trust agreement and any trust agreement supplement, the note purchase
or refunding agreements and the equipment note indentures and, with
respect to any leased aircraft equipment notes, the participation
agreements and the leases, and any other operative documents;
. immediately after giving effect to such transaction, no indenture
event of default or lease event of default has occurred or is
continuing; and
. Northwest has delivered a certificate and an opinion or opinions of
counsel indicating that such transaction, in effect, complies with
these conditions.
Modifications of the Basic Agreement
The basic pass through trust agreement permits Northwest, NWA Corp. and
the pass through trustee to enter into a supplemental trust agreement, without
the consent of the holders of any of the pass through certificates,
. to provide for the formation of a pass through trust and the issuance
of a series or class of pass through certificates,
. to evidence the succession of another corporation to Northwest or NWA
Corp. and the assumption by such corporation of Northwest's or NWA
Corp.'s obligations under the basic pass through trust agreement and
the applicable trust agreement supplement,
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. to add to the covenants of Northwest or NWA Corp. for the benefit of
holders of pass through certificates, or to surrender any right or
power in the basic pass through trust agreement conferred upon
Northwest or NWA Corp.,
. to cure any ambiguity or correct or supplement any defective or
inconsistent provision of the basic pass through trust agreement or the
applicable trust agreement supplement or to make any other provisions
with respect to matters or questions arising under those agreements,
provided the action does not adversely affect the interests of the
holders of such pass through certificates,
. to modify, eliminate or add to the provisions of the basic pass through
trust agreement to the extent necessary to continue the qualification
of the basic pass through trust agreement (including any supplemental
agreement) under the Trust Indenture Act of 1939, as amended, and to
add to the basic pass through trust agreement other provisions
expressly permitted by the Trust Indenture Act,
. to provide for a successor pass through trustee or to add to or change
any provision of the basic pass through trust agreement as necessary to
facilitate the administration of the pass through trusts thereunder by
more than one pass through trustee,
. to add, eliminate or change any provisions under the basic pass through
trust agreement that will not adversely affect the pass through
certificateholders in any material respect, provided that in each case,
such modification does not cause the corresponding pass through trust
to become taxable as an "association" within the meaning of Treasury
Regulation Section 301.7701-2 or a "publicly traded partnership"
within the meaning of Section 7704 of the Code taxable as a corporation
and
. to make any other amendments or modifications to the basic pass through
trust agreement, provided such amendments or modifications shall only
apply to pass through certificates issued thereafter.
The basic pass through trust agreement also contains provisions permitting
Northwest, NWA Corp. and the pass through trustee of a pass through trust,
with the consent of the pass through certificateholders of that pass through
trust evidencing fractional undivided interests aggregating not less than a
majority in interest, and, with respect to any leased aircraft, with the
consent of the applicable owner trustee (whose consent cannot be unreasonably
withheld), to execute supplemental trust agreements adding any provisions to
or changing or eliminating any of the provisions of the basic pass through
trust agreement, to the extent relating to such pass through trust, and the
applicable trust agreement supplement, or modifying the rights of the pass
through certificateholders. However, no supplemental trust agreement may,
without the consent of each pass through certificateholder affected thereby,
. reduce in any manner the amount of, or delay the timing of, any receipt
by the pass through trustee of payments on the equipment notes held in
that pass through trust or any distributions in respect of any pass
through certificate related to that pass through trust,
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. or change the date or place of any payment in respect of any pass
through certificate, or make distributions payable in coin or currency
other than that provided for in the pass through certificates, or
impair the right of any pass through certificateholder of that pass
through trust to institute suit for the enforcement of any such payment
when due,
. permit the disposition of any equipment note held in that pass through
trust, except as provided in the basic pass through trust agreement or
the applicable trust agreement supplement, or otherwise deprive any
pass through certificateholder of the benefit of the ownership of the
applicable equipment notes,
. reduce the percentage of the aggregate fractional undivided interests
of the pass through trust, the consent of the holders of which is
required for any supplemental trust agreement or for any waiver
provided for in the basic pass through trust agreement or the trust
agreement supplement,
. modify any of the provisions relating to the rights of the pass through
certificateholders in respect of the waiver of events of default or
receipt of payment or
. cause the pass through trust to become taxable as an "association"
within the meaning of Treasury Regulation Section 301.7701-2 or a
"publicly traded partnership" within the meaning of Section 7704 of
the Code taxable as a corporation.
Modification of Indenture and Related Agreements
The prospectus supplement will specify the pass through trustee's
obligations in the event that the pass through trustee, as the holder of any
equipment notes held in a pass through trust, receives a request for its
consent to any amendment, modification or waiver under the equipment note
indenture or other documents relating to the applicable equipment notes
(including any lease or any liquidity facility).
Cross-Subordination Issues
The equipment notes issued under an equipment note indenture may be held
in more than one pass through trust and one pass through trust may hold
equipment notes issued under more than one equipment note indenture. Unless
otherwise provided in a prospectus supplement, only equipment notes of the
same class or series may be held in the same pass through trust. In such
event, payments made on account of a subordinate class or series of equipment
notes issued under an equipment note indenture may, under circumstances
described in the related prospectus supplement, be subordinated to the prior
payment of all amounts owing to pass through certificateholders of a pass
through trust which holds senior equipment notes issued under all related
equipment note indentures. The prospectus supplement for an issuance of pass
through certificates will describe any such "cross-subordination" provisions
and any related terms, including the percentage of pass through
certificateholders under any pass through trust which are permitted to grant
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waivers of defaults under any related equipment note indenture, to consent to
the amendment or modification of any related equipment note indentures or to
direct the exercise of remedial actions under any related equipment note
indentures.
Termination of the Pass Through Trusts
The obligations of Northwest, NWA Corp. and the pass through trustee with
respect to a pass through trust will terminate upon the distribution to pass
through certificateholders of that pass through trust of all amounts required
to be distributed to them pursuant to the basic pass through trust agreement
and the applicable trust agreement supplement and the disposition of all
property held in that pass through trust. The pass through trustee for a pass
through trust will send to each pass through certificateholder of record,
notice of the termination of the pass through trust, the amount of the
proposed final payment and the proposed date for the distribution of the
final payment for that pass through trust. The final distribution to any pass
through certificateholder of a pass through trust will be made only upon
surrender of the pass through certificateholder's pass through certificates
at the office or agency of the pass through trustee specified in the notice
of termination.
Delayed Purchase
In the event that, on the delivery date of any pass through certificates,
all of the proceeds from the sale of the pass through certificates are not used
to purchase the equipment notes contemplated to be held in the pass through
trust, those remaining equipment notes may be purchased by the pass through
trustee at any time on or prior to a subsequent date specified in the
applicable prospectus supplement. In this event, the proceeds from the sale
of pass through certificates not used to purchase equipment notes will be
held under an arrangement described in the applicable prospectus supplement
pending the purchase of the equipment notes not so purchased. If any proceeds
are not subsequently used to purchase equipment notes by the date specified
in the prospectus supplement, those proceeds will be returned to the holders
of the related pass through certificates.
NWA Corp.'s Guarantee
NWA Corp. will unconditionally guarantee
. with respect to owned aircraft equipment notes, the full and prompt
payment of principal, premium, if any, and interest thereon when and
as due and payable, whether at maturity, upon redemption or otherwise,
and
. with respect to leased aircraft equipment notes, the full and prompt
payment of all amounts payable by Northwest under the related lease
when and as the same shall become due and payable.
NWA Corp.'s guarantee will be enforceable without any need first to
enforce any equipment note or lease against Northwest. NWA Corp.'s guarantee
will be an unsecured obligation of NWA Corp.
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Liquidity Facility
The related prospectus supplement may provide that one or more payments of
interest on the pass through certificates of one or more series or classes
will be supported by a liquidity facility issued by an institution identified
in the related prospectus supplement. The provider of a liquidity facility
will have a claim senior to the pass through certificateholders' as specified
in the related prospectus supplement.
The Trustee
The pass through trustee for each series or class of pass through
certificates will be identified in the prospectus supplement. With certain
exceptions, the pass through trustee will make no representations as to the
validity or sufficiency of the basic pass through trust agreement, the trust
agreement supplements, the pass through certificates, the equipment notes,
the equipment note indentures, the leases or other related documents. With
respect to any series or class of pass through certificates, the pass through
trustee shall not be liable for any action taken or omitted to be taken by it
in good faith in accordance with the direction of the holders of a majority
in principal amount of outstanding pass through certificates of that
series or class. Subject to these provisions, no pass through trustee will be
under any obligation to exercise any of its rights or powers under the basic
pass through trust agreement at the request of any holders of pass through
certificates issued thereunder unless those holders have offered to the pass
through trustee indemnity satisfactory to it. The basic pass through trust
agreement provides that the pass through trustee in its individual or any
other capacity may acquire and hold pass through certificates and, subject to
certain conditions, may otherwise deal with Northwest, NWA Corp. and, with
respect to the leased aircraft, with any owner trustee and owner participant
with the same rights it would have if it were not the pass through trustee.
The pass through trustee may resign under any or all of the pass through
trusts at any time, in which event Northwest will be obligated to appoint a
successor pass through trustee. If a pass through trustee
. ceases to be eligible to continue as pass through trustee or
. becomes incapable of acting as pass through trustee or
. becomes insolvent,
Northwest may remove that pass through trustee. In addition, upon the
occurrence of any of these events any person who has been a pass through
certificateholder of the related pass through trust for at least six months
may, on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the pass through trustee
and the appointment of a successor pass through trustee. Any resignation or
removal of the pass through trustee and appointment of a successor pass
through trustee will not become effective until acceptance of the appointment
by the successor pass through trustee. Pursuant to the resignation and
successor pass through trustee provisions, it is possible that a different
pass through trustee could be appointed to act as the successor pass through
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trustee. All references in this prospectus to the pass through trustee should
be read to take into account the possibility that the pass through trusts
could have different successor pass through trustees in the event of a
resignation or removal.
The basic pass through trust agreement provides that Northwest will pay
the pass through trustee's fees and expenses and indemnify the pass through
trustee against certain liabilities.
DESCRIPTION OF THE EQUIPMENT NOTES
The statements made under this caption are summaries and reference is made
to the entire prospectus and detailed information appearing in the applicable
prospectus supplement. Where no distinction is made between owned aircraft
equipment notes and leased aircraft equipment notes, or between their
respective equipment note indentures, such statements refer to any equipment
notes and any equipment note indenture.
To the extent that any provision in any prospectus supplement is
inconsistent with any provision in this summary, the provision of such
prospectus supplement will control.
General
All equipment notes will be issued under a separate equipment note
indenture,
. in the case of leased aircraft equipment notes, between the related
owner trustee of a trust for the benefit of an owner participant who is
the beneficial owner of the related aircraft, and the related loan
trustee, or
. between Northwest and the related loan trustee.
The equipment notes issued pursuant to the first bullet point of the
preceding sentence will be nonrecourse obligations of the applicable owner
trust. Each equipment note will be authenticated under an equipment note
indenture by the loan trustee. All equipment notes issued under the same
equipment note indenture will relate to, and be secured by, one or more
aircraft identified and described in the related prospectus supplement. In
the case of leased aircraft equipment notes, those aircraft will be leased to
Northwest pursuant to a lease between the owner trustee under the applicable
owner trust and Northwest. In the case of owned aircraft equipment notes,
those aircraft will be owned by Northwest.
With respect to each aircraft which is leased to Northwest, the related
owner trustee has acquired or will acquire those aircraft from Northwest or the
manufacturer of the aircraft, as the case may be, and will grant a security
interest in those aircraft to the related loan trustee as security for the
payments of the related equipment notes. In addition, the related owner
trustee will lease those aircraft to Northwest pursuant to a lease which will
be assigned to the related loan trustee. Pursuant to each lease, Northwest
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will be obligated to make or cause to be made rental and other payments to
the related loan trustee on behalf of the related owner trustee in amounts
that will be sufficient to make payments of the principal, interest and
premium, if any, required to be made in respect of the related equipment
notes when and as due and payable.
The obligations of Northwest
. to pay rent under each lease
. under the owned aircraft equipment notes and
. under the equipment note indenture for owned aircraft equipment notes
will be general obligations of Northwest. Except in certain circumstances
involving Northwest's purchase of a leased aircraft and the assumption of the
equipment notes related thereto, the leased aircraft equipment notes will be
issued by an owner trust and will not be obligations of, or guaranteed by,
Northwest.
Principal and Interest Payments
Interest received by a pass through trustee on the equipment notes held
in a pass through trust will be passed through to the pass through
certificateholders of that pass through trust on the dates and at the rate
per annum set forth in the applicable prospectus supplement until the final
distribution for that pass through trust. Principal received by a pass
through trustee on the equipment notes held in a pass through trust will be
passed through to the pass through certificateholders of that pass through
trust in scheduled amounts on the dates set forth in the applicable
prospectus supplement until the final distribution date for that pass through
trust.
If any date scheduled for any payment of principal of or premium, if any,
or interest on the equipment notes is not a business day in the jurisdictions
identified in the applicable prospectus supplement, that payment will be made
on the next succeeding business day without any additional interest.
Redemption
The applicable prospectus supplement will describe the circumstances,
whether voluntary or involuntary, under which the equipment notes may be
redeemed or purchased prior to the stated maturity date thereof, in whole or
in part, the premium, if any, applicable upon certain redemptions or purchases
and other terms applying to the redemptions or purchases of such equipment
notes.
Security
The leased aircraft equipment notes issued by an owner trust will be
secured by
. an assignment by the related owner trustee to the related loan trustee
of many of its rights under the lease, including the right to receive
payments of rent thereunder,
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. a mortgage in the aircraft granted to the related loan trustee,
subject to the rights of Northwest under the lease or leases, and
. an assignment to the related loan trustee of certain of the owner
trustee's rights under the aircraft purchase agreement between
Northwest and the related manufacturer.
Under the terms of each lease, Northwest's obligations in respect of the
aircraft leased to it will be those of a lessee under a "net lease."
Accordingly, Northwest will be obligated, among other things and at its
expense, to cause each leased aircraft to be duly registered, to pay all
costs of operating such aircraft and to maintain, service, repair and
overhaul (or cause to be maintained, serviced, repaired and overhauled) the
leased aircraft.
The assignment by an owner trustee to the related loan trustee of its
rights under a lease will exclude, among other things,
. rights of the owner trustee and the related owner participant relating
to indemnification by Northwest for certain matters,
. insurance proceeds payable to the owner trustee in its individual
capacity and to the owner participant under liability insurance
maintained by Northwest pursuant to the lease or by the owner trustee
or owner participant,
. insurance proceeds payable to the owner trustee in its individual
capacity or to the owner participant under certain casualty insurance
maintained by the owner trustee or owner participant pursuant to the
lease and
. any rights of the owner participant or owner trustee to enforce
payment of the foregoing amounts and their respective rights to the
proceeds of the foregoing.
The owned aircraft equipment notes will be secured by
. a mortgage granted to the related loan trustee of all of Northwest's
right, title and interest in and to the aircraft, and
. if so provided in the related prospectus supplement, an assignment to
the loan trustee of certain of Northwest's rights under the aircraft
purchase agreement between Northwest and the related manufacturer.
Under the terms of each equipment note indenture related to owned aircraft
equipment notes, Northwest will be obligated, among other things and at its
expense, to cause each owned aircraft to be duly registered, to pay all costs
of operating such aircraft and to maintain, service, repair and overhaul (or
cause to be maintained, serviced, repaired and overhauled) such aircraft.
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The prospectus supplement will specify the required insurance coverage for
to the aircraft.
Northwest will be required, except under certain circumstances, to keep
each aircraft registered under the Federal Aviation Act of 1958, as amended
(the "Federal Aviation Act"), and to record the equipment note indentures and
the leases, if applicable, among other documents, under the Federal Aviation
Act. This recordation will give the related loan trustee a perfected security
interest in the related aircraft whenever it is located in the United States
or any of its territories and possessions. The Convention on the
International Recognition of Rights in aircraft (the "Convention") provides
that this security interest will also be recognized, with certain limited
exceptions, in those jurisdictions that have ratified or adhere to the
Convention.
Northwest will have the right, subject to certain conditions, at its own
expense to register each aircraft in countries other than the United States.
Each aircraft may also be operated by Northwest or under lease, sublease or
interchange arrangements in countries that are not parties to the Convention.
The extent to which the related loan trustee's security interest would be
recognized in an aircraft located in a country that is not a party to the
Convention, and the extent to which this security interest would be
recognized in a jurisdiction adhering to the Convention if the aircraft is
registered in a jurisdiction not a party to the Convention, is uncertain.
Moreover, in the case of an equipment note indenture event of default, the
ability of the related loan trustee to realize upon its security interest in
an aircraft could be adversely affected as a legal or practical matter if the
aircraft was registered or located outside the United States.
Unless otherwise specified in the applicable prospectus supplement, the
equipment notes will not be cross-collateralized and consequently the
equipment notes issued in respect of any one aircraft will not be secured by
any other aircraft or, in the case of leased aircraft equipment notes, the
lease. Unless and until an indenture event of default with respect to a
leased aircraft equipment note has occurred and is continuing, the related
loan trustee may exercise only limited rights of the related owner trustee
under the related lease.
Funds, if any, held from time to time by the loan trustee, will be
invested and reinvested by the loan trustee. These investments and
reinvestments will be at the direction of Northwest in certain investments
described in the related equipment note indenture. These investments will not
be made at the direction of Northwest in the case of a lease event of default
or an equipment note indenture event of default, as applicable. The net amount
of any loss resulting from any investments made at the direction of Northwest
will be paid by Northwest.
Section 1110 of the Bankruptcy Code provides that the right of lessors,
conditional vendors and holders of security interests with respect to
"equipment" (as defined in Section 1110 of the Bankruptcy Code) to take
possession of this equipment in compliance with the provisions of a lease,
conditional sale contract or security agreement, as the case may be, is not
affected after 60 days after the filing of a petition under Chapter 11 of the
Bankruptcy Code by
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. the automatic stay provision of the Bankruptcy Code, which
provision enjoins creditors' remedies except with the court's approval,
. the provision of the Bankruptcy Code allowing the trustee in
reorganization to use property of the debtor during the reorganization
period,
. Section 1129 of the Bankruptcy Code, which governs the confirmation of
plans of reorganization in Chapter 11 cases, and
. any power of the bankruptcy court to enjoin a repossession.
Section 1110 provides that the right to take possession of an aircraft may
not be exercised for 60 days following the date of commencement of the
reorganization proceedings and may not be exercised at all after this 60-day
period (or a longer period if consented to by the lessor, conditional vendor
or holder of a security interest), if the trustee in reorganization agrees to
perform the debtor's obligations that become due on or after such date and
cures all existing defaults (other than defaults resulting solely from the
financial condition, bankruptcy, insolvency or reorganization of the debtor,
the appointment of a trustee or custodian or the failure to satisfy any
penalty rate or provision relating to a default arising from any failure by
the debtor to perform nonmonetary obligations under the applicable
agreement). "Equipment" is defined in Section 1110 of the Bankruptcy Code, in
part, as "an aircraft, aircraft engine, propeller, appliance, or spare
part (as defined in section 40102 of title 49) that is subject to a security
interest granted by, leased to or conditionally sold to a debtor that is a
citizen of the United States (as defined in section 40102 of title 49)
holding an air carrier operating certificate issued by the Secretary of
Transportation pursuant to chapter 47 of title 49 for aircraft capable of
carrying 10 or more individuals or 6,000 pounds or more of cargo."
Section 1110 does not prevent the trustee or debtor-in-possession from
rejecting a lease or demanding a renegotiation of a lease as a condition to
not rejecting the lease. In addition, if more than one aircraft are leased
pursuant to a master lease and accompanying lease supplement, the
applicability of Section 1110 would be determined on an aircraft-by-aircraft
basis. Assuming Section 1110 is applicable to all aircraft subject to a
master lease, Section 1110 does not prevent the trustee or debtor-in-
possession from complying with the provisions of Section 1110 with respect to
some lease supplements, and thereby retaining possession of the related
aircraft, and not complying with the provisions of Section 1110 with respect
to other lease supplements, and thereby enabling a repossession of other
aircraft.
In connection with any issuance of pass through certificates under this
prospectus and the applicable prospectus supplement, Northwest will receive
an opinion from its counsel to the effect that
. with respect to any aircraft leased to Northwest, the related owner
trustee, as lessor under the lease, and the related loan trustee, as
assignee of the owner trustee's rights under the lease pursuant to the
related equipment note indenture, would be entitled to the benefits of
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Section 1110 of the Bankruptcy Code with respect to the aircraft
initially delivered under the lease and subjected to the related
equipment note indenture or
. with respect to any aircraft which is owned by Northwest, the loan
trustee under the related equipment note indenture would be entitled
to the benefits of Section 1110 of the Bankruptcy Code with respect to
the aircraft initially subjected to the related equipment note
indenture.
These opinions will not address the possible replacement of an aircraft
after an event of loss (as defined in the equipment note indenture) in the
future.
Ranking of Equipment Notes
Some of the equipment notes related to one or more aircraft, as described
in the related prospectus supplement, may be subordinated and junior in right
of payment to other equipment notes related to the same aircraft. The terms of
the subordination, if any, will be described in the related prospectus
supplement.
Payments and Limitation of Liability
Each leased aircraft will be leased by the related owner trustee to
Northwest for a term which commences on the delivery date of the aircraft to
the owner trustee and expires on a date not earlier than the latest maturity
date of the related equipment notes, unless previously terminated as permitted
by the terms of the related lease. The basic rent and other payments under each
lease will be payable by Northwest in accordance with the terms specified in
the applicable prospectus supplement, and will be assigned by the owner
trustee under the related equipment note indenture to the related loan
trustee to provide the funds necessary to pay principal of, premium, if any,
and interest due from the owner trustee on the related equipment notes. In
certain cases, the basic rent payments under a lease may be adjusted, but
each lease will provide that under no circumstances will rent payments by
Northwest be less than the scheduled payments on the related equipment notes.
The balance of any basic rent payment under a lease, after payment of amounts
due on the related equipment notes, will be paid over to the applicable owner
participant.
None of the owner trustees, the owner participants or the loan trustees
will be personally liable for amounts payable under the leased aircraft
equipment notes issued by an owner trust. Except as provided in the equipment
note indenture related to any leased aircraft equipment notes, neither the
owner trustees nor the loan trustees will be personally liable for any amount
payable under these equipment note indentures. Additionally, except as
otherwise provided in the related equipment note indenture, no owner trustee
will be personally liable for any statements, representations, warranties,
agreements or obligations under the equipment note indentures or under the
leased aircraft equipment notes except for its own willful misconduct or
gross negligence. None of the owner participants will have any duty or
responsibility under the equipment note indentures or under the leased
aircraft equipment note to the related loan trustee or to any holder of any
leased aircraft equipment note.
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Except in the circumstances referred to above, all amounts payable under
any equipment notes issued by an owner trust in connection with the lease of
aircraft to Northwest, other than payments made in connection with an
optional redemption or purchase by the related owner trustee or the related
owner participant, will be made only from
. the assets subject to the lien of the related equipment note indenture
or the income and proceeds received by the related loan trustee
therefrom, including rent payable by Northwest under the related lease)
and
. if so provided in the related prospectus supplement, the applicable
liquidity facility.
Defeasance of the Indentures and the Equipment Notes in Certain Circumstances
Unless otherwise specified in the applicable prospectus supplement, each
equipment note indenture provide that the obligations of the loan trustee,
the owner trustee or Northwest, as applicable, under that applicable
equipment note indenture will be deemed to have been discharged and paid in
full (except for certain obligations, including the obligations to register
the transfer or exchange of equipment notes, to maintain paying agencies and
to hold money for payment in trust) on the 91st day after the irrevocable
deposit with the loan trustee of money or certain obligations of the United
States which will provide money in an aggregate amount sufficient to pay when
due principal of, premium, if any, and interest on all related equipment
notes in accordance with their terms. A discharge may occur only if, among
other things, there has been published by the Internal Revenue Service a
ruling to the effect that holders of the related equipment notes will not
recognize income, gain or loss for federal income tax purposes as a result of
the deposit, defeasance and discharge and will be subject to federal income
tax on the same amount and in the same manner and at the same time as would
have been the case if the deposit, defeasance and discharge had not occurred.
Upon
. a defeasance,
. payment in full of the principal of, premium, if any, and interest on
all equipment notes issued under an equipment note indenture on the
maturity date or
. deposit with the loan trustee no earlier than one year prior to the
maturity date of money sufficient for payment in full of the principal
of, premium, if any, and interest on all equipment notes issued under
an equipment note indenture on the maturity date,
the holders of these equipment notes will have no beneficial interest in or
other rights with respect to the related aircraft or other assets subject to
the lien of the equipment note indenture and the lien will terminate.
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Assumption of Lease Obligations by Northwest
Unless otherwise specified in the applicable prospectus supplement, upon
the exercise by Northwest of any purchase options it may have under a lease
prior to the end of the term of that lease, Northwest may assume on a full
recourse basis all of the obligations of the owner trustee (other than its
obligations in its individual capacity) under the related equipment note
indenture, including the obligations to make payments in respect of the
equipment notes. In this event, certain relevant provisions of the lease,
including provisions relating to maintenance, possession and use of the
related aircraft, liens, insurance and events of default, will be incorporated
into the assumed equipment note indenture, and the equipment notes issued under
the assumed equipment note indenture will not be redeemed and will continue
to be secured by such aircraft.
Liquidity Facility
The related prospectus supplement may provide that one or more payments of
interest on the related equipment notes of one or more series or classes or
distributions made by the pass through trustee of the related pass through
trust will be supported by a liquidity facility. The provider of the
liquidity facility will be identified in the related prospectus supplement.
Unless otherwise provided in the related prospectus supplement, the provider
of the liquidity facility will have a senior claim upon the assets securing
the equipment notes.
Intercreditor Issues
Equipment notes may be issued in different classes or series, which means
that the equipment notes may have different payment priorities even though
they are issued by the same issuer and relate to the same aircraft. In this
event, the related prospectus supplement will describe the priority of
distributions among the equipment notes and any liquidity facilities, the
ability of any class or series to exercise and/or enforce any remedies with
respect to the related aircraft and, if applicable, the related lease, and
certain other intercreditor terms and provisions.
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
General
The following discussion represents the opinion of Cadwalader, Wickersham
& Taft as to the principal U.S. federal income tax consequences to pass through
certificateholders of the purchase, ownership and disposition of the pass
through certificates. Except as otherwise specified, the discussion is
addressed to beneficial owners of pass through certificates ("U.S.
Certificateholders") that are citizens or residents of the United States,
corporations, partnerships or other entities created or organized in or under
the laws of the United States or any State, estates the income of which is
subject to U.S. federal income taxation regardless of its source or,
generally, trusts if a court within the United States is able to exercise
primary supervision over the administration of such trust, and one or more of
the foregoing persons have the authority to control all substantial decisions
of such trust ("U.S. Persons") that will hold the pass through certificates
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as capital assets. This discussion does not address the tax treatment of U.S.
Certificateholders that may be subject to special tax rules, such as banks,
insurance companies, dealers in securities or commodities, tax-exempt
entities, holders that will hold pass through certificates as part of a
straddle or holders that have a "functional currency" other than the U.S.
Dollar, nor does it address the tax treatment of U.S. Certificateholders that
do not acquire pass through certificates as part of the initial offering.
This discussion does not describe any tax consequences arising under the laws
of any State, locality or taxing jurisdiction other than the United States.
This discussion is based upon the tax laws of the United States as in
effect on the date of this prospectus, as well as judicial and administrative
interpretations thereof (in final or proposed form) available on or before
such date. All of the foregoing are subject to change or differing
interpretations, which could apply retroactively. Prospective investors
should note that no rulings have been or will be sought from the Internal
Revenue Service (the "IRS") with respect to any of the federal income tax
consequences discussed below, and no assurance can be given the IRS will not
take contrary positions. Prospective investors should consult their own tax
advisors with respect to the federal, state, local and foreign tax
consequences of the purchase, ownership and disposition of the pass through
certificates.
Tax Status of the Pass Through Trusts
In the opinion of Cadwalader, Wickersham & Taft, special counsel to
Northwest, each pass through trust will not be classified as an association
or a publicly traded partnership taxable as a corporation for U.S. federal
income tax purposes and will not be subject to federal income tax. Each pass
through trust will file federal income tax returns and report to investors on
the basis that it is a grantor trust under Subpart E, Part I of Subchapter J
of the Code. If a pass through trust were treated as a partnership for U.S.
federal income tax purposes rather than as a grantor trust, in the opinion of
Cadwalader, Wickersham & Taft, the consequences to U.S. Certificateholders
and, to the extent described below, Non-U.S. Certificateholders, would not be
materially different. The remainder of this discussion describes the
consequences of the treatment as a grantor trust. Pass through
certificateholders who are not U.S. Persons should consult their own tax
advisors as to the suitability to them of an investment in the pass through
certificates.
Taxation of Certificateholders Generally
A U.S. Certificateholder will be treated as owning its pro rata undivided
interest in each of the equipment notes and any other property held by the
related pass through trust. Accordingly, each U.S. Certificateholder's share
of interest paid on the equipment notes will be taxable as ordinary income,
as it is paid or accrued, in accordance with such owner's method of
accounting for U.S. federal income tax purposes and a U.S.
Certificateholder's share of premium, if any, paid on the equipment notes
will be treated as capital gain. Any amounts received by a pass through trust
from drawings under a liquidity facility will be treated for U.S. federal
income tax purposes as having the same characteristics as the payments they
replace.
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Each U.S. Certificateholder will be entitled to deduct, consistent with
its method of accounting, its pro rata share of fees and expenses paid or
incurred by the corresponding pass through trust as provided in Section 162
or 212 of the Code. Certain fees and expenses, including fees paid to the
pass through trustee and the liquidity facility provider, will be borne by
parties other than the pass through certificateholders. It is possible that
such fees and expenses will be treated as constructively received by the pass
through trust, in which event a U.S. Certificateholder will be required to
include in income and will be entitled to deduct its pro rata share of such
fees and expenses. If a U.S. Certificateholder is an individual, estate or
trust, the deduction for such holder's share of such fees or expenses will be
allowed only to the extent that all of such holder's miscellaneous itemized
deductions, including such holder's share of such fees and expenses, exceed
2% of such holder's adjusted gross income. In addition, in the case of U.S.
Certificateholders who are individuals, certain otherwise allowable itemized
deductions will be subject generally to additional limitations on itemized
deductions under the applicable provisions of the Code.
Effect of Subordination of Subordinated Certificateholders
If any pass through trust with respect to a series or class which is
subordinated with respect to other pass through trusts of the same series or
class (such pass through trusts being the "Subordinated Trusts" and the
related pass through certificates being the "Subordinated Certificates")
receives less than the full amount of the receipts of principal or interest
paid with respect to the equipment notes held by it (any shortfall in such
receipts being the "Shortfall Amounts") because of the subordination of the
equipment notes held by that pass through trust under an intercreditor
agreement, the corresponding owners of beneficial interests in the
Subordinated Certificates (the "Subordinated Certificateholders") would
probably be treated for federal income tax purposes as if they had (1)
received as distributions their full share of such receipts, (2) paid over to
the relevant preferred class of pass through certificateholders an amount
equal to their share of such Shortfall Amount, and (3) retained the right to
reimbursement of such amounts to the extent of future amounts payable to such
Subordinated Certificateholders with respect to such Shortfall Amount.
Under this analysis,
. Subordinated Certificateholders incurring a Shortfall Amount would be
required to include as current income any interest or other income of
the corresponding Subordinated Trust that was a component of the
Shortfall Amount, even though such amount was in fact paid to the
relevant preferred class of pass through certificateholders,
. a loss would only be allowed to the Subordinated Certificateholders
when their right to receive reimbursement of the Shortfall Amount
became worthless (i.e., when it becomes clear that funds will not be
available from any source to reimburse such loss), and
. reimbursement of the Shortfall Amount prior to a claim of worthlessness
would not be taxable income to Subordinated Certificateholders because
the reimbursed amount was previously included in income.
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These results should not significantly affect the inclusion of income for
Subordinated Certificateholders on the accrual method of accounting, but
could accelerate inclusion of income to Subordinated Certificateholders on
the cash method of accounting by, in effect, placing them on the accrual
method.
Original Issue Discount
The equipment notes may be issued with original issue discount ("OID"),
which may require U.S. Certificateholders to include the OID in gross income in
advance of the receipt or accrual of the stated interest on the equipment
notes. The prospectus supplement will state whether any equipment notes to be
held by the related pass through trust will be issued with OID. Generally, a
holder of a debt instrument issued with original issue discount that is not
de minimis must include the original issue discount in income for federal
income tax purposes as it accrues, in advance of the receipt of the cash
attributable to such income, under a method that takes into account the
compounding of interest.
Market Discount
Generally, the term "market discount" means the excess of the remaining
principal amount of a pass through certificate over the holder's tax basis in
that pass through certificate immediately after its acquisition, subject to a
de minimis exception.
A holder who acquires a pass through certificate at a market discount will
be required to treat any gain realized on the disposition of this pass through
certificate, except in certain nonrecognition transactions, as ordinary
income to the extent of the market discount that accrued during the period
that the holder held the pass through certificate. Further, a disposition of
a pass through certificate by gift (and in certain other circumstances) could
result in the recognition of market discount income, computed as if the pass
through certificate had been sold for its fair market value.
In the case of a partial principal payment on indebtedness subject to the
market discount rules, Section 1276 of the Code requires that the partial
payment be included in gross income as ordinary income to the extent it does
not exceed the market discount that has accrued during the period the
indebtedness was held. The amount of any accrued market discount later
required to be included in income upon a disposition, or subsequent partial
principal payment, will be reduced by the amount of accrued market discount
previously included in income.
Until Treasury regulations are issued, the explanatory Conference
Committee Report to the Tax Reform Act of 1986 (the "Conference Report")
indicates that holders of installment obligations, such as the equipment
notes, with market discount may elect to accrue market discount either
. on the basis of a constant interest rate or
. in the ratio to the total amount of remaining market discount that the
amount of stated interest paid in the accrual period bears to the total
amount of stated interest remaining to be paid on the installment
obligation as of the beginning of such period.
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Under Section 1277 of the Code, if in any taxable year interest paid or
accrued on indebtedness incurred or continued to purchase or carry
indebtedness subject to the market discount rules exceeds the interest
currently includable in income with respect to this indebtedness, deduction
of the excess interest must be deferred to the extent of the market discount
allocable to the taxable year. The deferred portion of any interest expense
will generally be deductible when such market discount is included in income
upon the sale or other disposition (including repayment) of the indebtedness.
A holder of a pass through certificate acquired at a market discount may
elect under Section 1278 of the Code, in the manner provided by Revenue
Procedure 92-67, 1992-34 I.R.B. 6, to include such discount in income as it
accrues. The current inclusion election applies to all market discount
obligations acquired on or after the first day to which the election applies,
and may not be revoked without the consent of the IRS. If a holder of a pass
through certificate elects to include market discount in income as it
accrues, the foregoing rules of Section 1276 and 1277 of the Code with
respect to the recognition of ordinary income on a sale or other disposition
of such pass through certificate and the deferral of interest deductions on
indebtedness related to such pass through certificate would not apply.
The IRS is authorized to issue regulations to implement the market
discount provisions of the Code. No regulations have been issued or proposed.
It is impossible to anticipate what effect, if any, regulations could have on
the pass through certificateholders.
Amortizable Bond Premium
A U.S. Certificateholder should generally be considered to have acquired
an interest in an equipment note at a premium to the extent the purchaser's tax
basis allocable to its interest exceeds the remaining principal amount of the
equipment note allocable to its interest. In that event, a U.S.
Certificateholder who holds a pass through certificate as a capital asset may
elect to amortize that premium as an offset to interest income under
Section 171 of the Code with corresponding reductions in the U.S.
Certificateholder's tax basis in its pass through certificate. In the case of
installment obligations (such as the equipment notes), the Conference Report
indicates a Congressional intent that amortization will be in accordance with
the same rules that will apply to the accrual of market discount on
installment obligations (see discussion above).
Under certain circumstances, amortizable bond premium may be determined
by reference to any early call date. It is unclear how the amortizable bond
premium rules apply where, as in the case with the equipment notes, the
amount of redemption premium payable on an early call date is unknown. In
addition, the treatment of any unamortized bond premium remaining at the time
of an early call is unclear. The U.S. Certificateholders are urged to consult
their own tax advisors as to the treatment of any amortizable bond premiums.
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Sale or Other Disposition of the Certificates
Upon the sale, exchange or other disposition of a pass through
certificate, a U.S. Certificateholder will recognize gain or loss equal to
the difference between the amount realized on the disposition (other than any
amount attributable to accrued interest which will be taxable as ordinary
income) and the U.S. Certificateholder's adjusted tax basis in the related
equipment notes and any other assets held by the corresponding pass through
trust. A U.S. Certificateholder's adjusted tax basis will equal the holder's
cost for its pass through certificate, plus any accrued OID or market discount
previously included in income or less any amortized bond premium or any
previously recognized losses or prior principal payments. Any gain or loss
generally will be capital gain or loss (other than accrued market discount
not previously included in income) if the pass through certificate was held
as a capital asset.
Foreign Certificateholders
Subject to the discussion of backup withholding below, payments of
principal and interest (including OID) on the equipment notes to, or on behalf
of, any beneficial owner of a pass through certificate that is not a U.S.
Person (a "Non-U.S. Certificateholder") will not be subject to U.S. federal
withholding tax; provided, in the case of interest, that
- such Non-U.S. Certificateholder does not actually or constructively own
10% or more of the total combined voting power of all classes of the
stock of any owner participant (in the case of leased aircraft
equipment notes) or of Northwest (in the case of owned aircraft
equipment notes),
- such Non-U.S. Certificateholder is not a controlled foreign corporation
for U.S. tax purposes that is related to an owner participant (in the
case of leased aircraft equipment notes) or of Northwest (in the case
of owned aircraft equipment notes), and
- either (A) the Non-U.S. Certificateholder certifies, under penalties of
perjury, that it is not a U.S. Person and provides its name and
address or (B) a securities clearing organization, bank or other
financial institution that holds customers' securities in the ordinary
course of its trade or business (a "financial institution") and holds
the pass through certificate certifies, under penalties of perjury,
that such statement has been received from the Non-U.S.
Certificateholder by it or by another financial institution and
furnishes the payor with a copy thereof.
Any capital gain realized upon the sale, exchange, retirement or other
disposition of a pass through certificate or upon receipt of premium paid on
an equipment note by a Non-U.S. Certificateholder will not be subject to U.S.
federal income or withholding taxes if
- such gain is not effectively connected with a U.S. trade or business of
the holder and
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- in the case of an individual, the Non-U.S. Certificateholder is not
present in the United States for 183 days or more in the taxable year
of the sale, exchange, retirement or other disposition or receipt.
Any interest or gain described in the two preceding paragraphs will be
subject to U.S. federal income tax and return filing requirements if it is
effectively connected with the conduct of a U.S. trade or business by a Non-
U.S. Certificateholder.
Backup Withholding
In general, information reporting requirements will apply to certain
payments within the United States of principal, interest, OID and premium on
the pass through certificates, and to payments of the proceeds of certain
sales of pass through certificates made to U.S. Certificateholders other than
certain exempt recipients (such as corporations). A 31% "backup withholding"
tax may apply to such payments if the holder fails or has failed to provide an
accurate taxpayer identification number or otherwise establish an exemption
or fails to report in full interest income. With respect to Non-U.S.
Certificateholders, payments made on a pass through certificate and proceeds
from the sale of a pass through certificate owned by a Non-U.S.
Certificateholder will generally not be subject to such information reporting
requirements or backup withholding tax if such Non-U.S. Certificateholder
provides the applicable statement as to its non-U.S. status or otherwise
establishes an exemption.
Backup withholding is not an additional tax. Any amounts withheld under
the backup withholding rules will be allowed as a refund or credit against the
holder's U.S. federal income tax liability, if any, provided the required
information is furnished to the IRS.
The Treasury Department recently issued final Treasury Regulations (the
"Final Regulations") governing withholding, backup withholding and
information reporting requirements. The Final Regulations do not
significantly alter the substantive withholding and information reporting
requirements discussed herein; they unify current certification procedures
and forms and clarify reliance standards. The Final Regulations will
generally become effective for payments made after December 31, 2000.
ERISA CONSIDERATIONS
Unless otherwise indicated in the applicable prospectus supplement, the
pass through certificates may, subject to certain legal restrictions, be
purchased and held by an employee benefit plan (a "Plan") subject to Title I
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
or an individual retirement account or an employee benefit plan subject to
section 4975 of the Code. A fiduciary of a Plan must determine that the
purchase and holding of a pass through certificate is consistent with its
fiduciary duties under ERISA and does not result in a non-exempt prohibited
transaction as defined in section 406 of ERISA or section 4975 of the Code.
Employee benefit plans which are governmental plans (as defined in
section 3(32) of ERISA) and certain church plans (as defined in section 3(33)
of ERISA) are not subject to Title I of ERISA or section 4975 of the Code.
The pass through certificates may, subject to certain legal restrictions, be
purchased and held by such plans.
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PLAN OF DISTRIBUTION
Northwest may sell the offered securities in one or more of the following
ways from time to time:
- by or through underwriters,
- by itself directly to investors or other persons,
- through dealers or agents or
- through a combination of any of these methods of sale.
The offered securities may be sold
- at a fixed price or prices, which may be changed,
- from time to time at market prices prevailing at the time of sale,
- at prices related to those market prices, or
- at negotiated prices.
The prospectus supplement relating to an offering of offered securities
will set forth the terms of that offering, including:
- the name or names of any underwriters, dealers or agents involved in
the offer and sale of the offered securities,
- any underwriting compensation paid by Northwest to underwriters,
dealers or agents in connection with the offering and any discounts,
concessions or commissions allowed by underwriters to participating
dealers,
- the purchase price of the offered securities and the proceeds to
Northwest from the sale,
- any delayed delivery arrangements,
- the initial public offering price, and
- any securities exchanges on which the offered securities may be
listed.
Dealer trading may take place in certain of the offered securities,
including offered securities not listed on any securities exchange. Any
initial public offering price and any discounts or commissions allowed or
reallowed or paid to dealers may change.
In connection with the sale of offered securities, underwriters may be
deemed to have received compensation from Northwest in the form of underwriting
discounts or commissions and may also receive commissions from purchasers of
offered securities for whom they may act as agent. Underwriters may sell
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offered securities to or through dealers, and those dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions, which may be changed from time to time, from
the purchasers for whom they may act as agent.
If Northwest directly uses a dealer in the sale of offered securities,
Northwest will sell the offered securities to the dealer, as principal. The
dealer may then resell the offered securities to the public at varying prices
to be determined by the dealer at the time of resale. The applicable
prospectus supplement will set forth the terms of any of those sales.
Northwest may offer and sell offered securities through agents designated
by Northwest from time to time. The applicable prospectus supplement will set
forth any commissions payable by Northwest to the agent. Unless the
applicable prospectus indicates otherwise, the agent will be acting on a best
efforts basis for the period of its appointment.
Northwest may directly solicit offers to purchase offered securities and
sell them directly to institutional investors or others who may be deemed to be
underwriters within the meaning of the Securities Act of 1933 with respect to
any resale of the offered securities. The applicable prospectus supplement
will describe the terms of any of those sales.
Except as set forth in the applicable prospectus supplement, no director,
officer or employee of Northwest or NWA Corp. will solicit or receive a
commission in connection with direct sales by Northwest of the offered
securities, although these persons may respond to inquiries by potential
purchasers and perform ministerial and clerical work in connection with any
of these direct sales.
Underwriters, dealers and agents participating in the distribution of the
Offered Securities may be deemed to be underwriters, and any discounts and
commissions received by them and any profit realized by them on resale of the
Offered Securities may be deemed to be underwriting discounts and commissions
under the Securities Act of 1933.
Underwriters, dealers and agents may be entitled, under agreements with
Northwest and NWA Corp., to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Securities Act of
1933 as a result of material misstatements and omissions. Underwriters,
dealers and agents may also be entitled to reimbursement by Northwest and NWA
Corp. for certain expenses. Underwriters, dealers and agents may engage in
transactions with, or perform services for, NWA Corp., Northwest and NWA
Corp.'s other subsidiaries in the ordinary course of business.
If the applicable prospectus supplement so indicates, we will authorize
agents, underwriters or dealers to solicit offers from institutions to
purchase securities from us at the public offering price indicated in the
prospectus supplement through delayed delivery contracts providing for
payment and delivery on a specified date in the future. The prospectus
supplement will specify the conditions of these contracts and the commission
payable for solicitation of the contracts.
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If Northwest uses an underwriter or underwriters in the sale of any
offered securities, the applicable prospectus supplement will contain a
statement as to the underwriters' intention, if any, at the date of the
prospectus supplement to make a market in the offered securities. No
assurances can be given that there will be a market for the offered securities.
The applicable prospectus supplement will set forth the place and time of
delivery for the offered securities. Northwest will issue the debt securities
that are issuable upon exercise of warrants upon payment of the exercise
price and otherwise in accordance with the relevant terms applicable to the
warrants as described in the applicable prospectus supplement.
LEGAL OPINIONS
Unless the applicable prospectus supplement indicates otherwise, the
validity of the pass through certificates and NWA Corp.'s guarantee will be
passed upon for Northwest by Simpson Thacher & Bartlett, New York, New York.
Unless the applicable prospectus supplement indicates otherwise, Simpson
Thacher & Bartlett will rely on the opinion of counsel for the pass through
trustee as to certain matters relating to the authorization, execution and
delivery of such pass through certificates by, and the valid and binding
effect thereof on, such pass through trustee. Certain federal income tax
matters will be passed upon by Cadwalader, Wickersham & Taft, New York, New
York, special tax counsel to Northwest.
EXPERTS
Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements and schedule of NWA Corp. included in NWA Corp.'s Annual
Report on Form 10-K for the year ended December 31, 1999, as set forth in
their report on the consolidated financial statements and schedule
incorporated by reference in this prospectus. Such consolidated financial
statements and schedule are incorporated by reference in this prospectus in
reliance on Ernst & Young LLP's report, given on their authority as experts
in accounting and auditing.
___________
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses in connection with the issuance and distribution of
the securities being registered, other than underwriting discounts and
commissions, are set forth in the following table.
Securities and Exchange Commission fee $259,957
Printing and engraving expenses 600,000*
Accountants' fees and expenses 100,000*
Legal fees and expenses 1,300,000*
Blue Sky fees and expenses 60,000*
Pass Through Trustees' fees and expenses 40,000*
Rating Agency fees 500,000*
Miscellaneous 240,143*
-----------
Total $ 3,100,000*
===========
___________
* Estimated and subject to future contingencies.
Item 15. Indemnification of Directors and Officers
Section 302A.521 of the Minnesota Business Corporation Act (the "Minnesota
Law") requires a Minnesota corporation to indemnify a person made or
threatened to be made a party to a proceeding by reason of the former or
present official capacity of the person against judgments, penalties, fines
and reasonable expenses (including attorneys' fees), provided that the person
has not otherwise been indemnified, was acting in good faith, received no
improper personal benefit as a result of the conduct in question, in the case
of a criminal proceeding, had no reasonable cause to believe the conduct was
unlawful and, depending upon the capacity in which such person was acting,
believed that the conduct was in the best interests of the corporation or was
not considered to be opposed to the best interests of the corporation. Under
the Minnesota Law, the termination of a proceeding by judgment, order,
settlement, conviction or upon a pleading of nolo contendere or its
equivalent does not, of itself, establish that a person is not eligible for
indemnification. Minnesota corporations are permitted to include provisions
in their bylaws or articles of incorporation that prohibit or limit
indemnification otherwise required by the Minnesota law.
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Section 4.01 of Northwest Airlines, Inc.'s ("Northwest") amended and
restated bylaws (filed as Exhibit 4(o)) requires Northwest to indemnify any
persons, including officers and directors as permitted by Section 302A.521 of
the Minnesota Law.
Section 145 of the General Corporation Law of the State of Delaware (the
"Delaware Law") empowers a Delaware corporation to indemnify any persons who
are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
such corporation), by reason of the fact that such person is or was an
officer, director, employee or agent of such corporation, or is or was
serving at the request of such corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise. The indemnity may include expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with such action, suit or proceeding,
provided that such officer, director, employee or agent acted in good faith
and in a manner he reasonably believed to be in or not opposed to the
corporation's best interests, and, for criminal proceedings, had no
reasonable cause to believe his conduct was unlawful. A Delaware corporation
may indemnify officers and directors in an action by or in the right of the
corporation under the same conditions, except that no indemnification is
permitted without judicial approval if the officer or director is adjudged to
be liable to the corporation. Where an officer or director is successful on
the merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses which such officer or
director actually and reasonably incurred.
In accordance with Section 102(b)(7) of the Delaware Law, the Restated
Certificate of Incorporation of Northwest Airlines Corporation ("NWA Corp.")
provides that the directors of NWA Corp. shall not be personally liable to
NWA Corp. or its stockholders for monetary damages for violations of their
fiduciary duty.
Article VIII of the bylaws, as amended and restated, of NWA Corp. (filed
as Exhibit 4(m)) provides for indemnification of the officers and directors of
NWA Corp. to the full extent permitted by applicable law.
Item 16. Exhibits
The following Exhibits are filed as part of this Registration Statement:
Exhibit 1(a) Form of Underwriting Agreement for debt securities or
warrants to Purchase debt securities of Northwest (filed
as Exhibit 1(a) to Registration Statement on Forms-3 (File
No. 333-79215, and hereinafter, "Registration Statement
No. 33-79125") No. 33-79215 and incorporated herein
by reference).
Exhibit 1(b) Form of Underwriting Agreement for Pass Through Certificates
of Northwest (filed as Exhibit 1(b) to Registration
No. 333-79215 and incorporated herein by reference).
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Exhibit 4(a) Senior debt securities Indenture, dated as of March 1, 1997,
among Northwest, Old NWA Corp. and State Street Bank and
Trust Company ("State Street"), as Trustee, relating to the
Senior debt securities of Northwest, as supplemented by
Supplemental Indenture, dated as of November 20, 1998,
among NWA Corp., Old NWA Corp., Northwest, and State Street,
as Trustee, and Second Supplemental Indenture, dated as of
February 25, 1999, among NWA Corp., Old NWA Corp., Northwest
and State Street, as Trustee (filed as Exhibit 4(a) to
Registration Statement No. 333-79215 and incorporated herein
by reference).
Exhibit 4(b) Form of subordinated debt securities Indenture among
Northwest, NWA Corp. and State Street, as Trustee, relating
to the subordinated debt securities of Northwest (filed as
Exhibit 4(b) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(c) Form of senior debt securities of Northwest (filed as
Exhibit 4(c) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(d) Form of subordinated debt securities of Northwest (filed as
Exhibit 4(d) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(e) Form of warrant Agreement for warrants to Purchase debt
securities of Northwest that are Sold Attached to debt
securities of Northwest (filed as Exhibit 4(e) to
Registration Statement No. 333-79215 and incorporated
herein by reference).
Exhibit 4(f) Form of warrant to Purchase debt securities of Northwest
that are Sold Attached to debt securities of Northwest
(included as part of Exhibit 4(e)).
Exhibit 4(g) Form of warrant Agreement for warrants to Purchase debt
securities of Northwest that are Sold Alone (filed as
Exhibit 4(g) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(h) Form of warrant to Purchase debt securities of Northwest that
are Sold Alone (included as part of Exhibit 4(g)).
Exhibit 4(i) Pass Through Trust Agreement dated June 3, 1999 among NWA
Corp., Northwest and State Street, Bank and Trust Company of
Connecticut, National Association ("State Street
Connecticut") as Trustee, relating to Pass Through
Certificates of Northwest (filed as Exhibit 4(i) to
Registration No. 333-79215 and incorporated herein by
reference).
Exhibit 4(j) Form of Pass Through Certificate included in Exhibit 4(i).
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Exhibit 4(k) Form of Bond (filed as Exhibit 4.3 to NWA Corp's Quarterly
Report on Form 10-Q for the three months ended
September 30, 1999 and incorporated herein by reference).
Exhibit 4(l) Restated Certificate of Incorporation of NWA Corp. (filed
as Exhibit 4.1 to NWA Corp.'s Registration Statement on
Form S-3 File No. 333-69635) and incorporated herein by
reference).
Exhibit 4(m) Amended and Restated By-Laws of NWA Corp. (filed as Exhibit
4.1 to NWA Corp.'s Quarterly Report on Form 10-Q for the
three months ended March 31, 1999 (hereinafter "1999 First
10-Q") and incorporated herein by reference).
Exhibit 4(n) Restated Certificate of Incorporation of Northwest (filed as
Exhibit 4(s)to Registration Statement No. 333-74772 and
incorporated herein by reference).
Exhibit 4(o) Amended and Restated Bylaws of Northwest (filed as Exhibit
4.2 to the 1999 First 10-Q and incorporated herein by
reference).
Exhibit 4(p) Certificate of Designation of Series C Preferred Stock of
NWA Corp.(included in Exhibit 4(l)).
Exhibit 4(q) Certificate of Designation of Series D Junior Participating
Preferred Stock of NWA Corp. (included in Exhibit 4(l)).
Exhibit 4(r) The Registrants hereby agree to furnish to the Commission,
upon request, copies of certain instruments defining the
rights of holders of long-term debt of the kind described
in Item 601(b)(4) of Regulation S-K.
Exhibit 5** Opinion of Simpson Thacher & Bartlett as to the legality
of the Securities.
Exhibit 8** Tax Opinion of Cadwalader, Wickersham & Taft relating to Pass
Through Certificates.
Exhibit 23(a)* Consent of Ernst & Young LLP.
Exhibit 23(b) Consent of Simpson Thacher & Bartlett (included as part of
Exhibit 5).
Exhibit 23(c) Consent of Cadwalader, Wickersham & Taft (included as part
of Exhibit 8).
Exhibit 24 Powers of Attorney (included in signature pages of this
Registration Statement).
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Exhibit 25(a) Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), of State
Street, as Trustee under the Senior Debt Securities Indenture
of Northwest and NWA Corp. (filed as Exhibit 25.1 to
NWA Corp.'s Current Report on Form 8-K, dated March 6, 1997,
and incorporated herein by reference).
Exhibit 25(b) Form T-1 Statement of Eligibility under the Trust Indenture
Act of State Street, as Trustee under the Subordinated Debt
Securities Indenture of Northwest and NWA Corp. (filed as
Exhibit 25(b) to Registration Statement No. 333-13307 and
incorporated herein by reference).
Exhibit 25(c) Form T-1 Statement of Eligibility under the Trust Indenture
Act of State Street Connecticut, as Trustee under the Pass
Through Trust Agreement of Northwest and NWA Corp (filed as
Exhibit 25(c) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 99(a) Trustee Parent Guarantee of State Street in favor of State
Street Connecticut in connection with the Pass Through Trust
Agreement of Northwest and NWA Corp. (filed as Exhibit 99(a)
to Registration No. 333-79215 and incorporated herein by
reference).
___________
* Filed herewith.
** To be filed by amendment.
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Item 17. Undertakings
(a) Each of the undersigned registrants hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
Registration Statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the Registration Statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by NWA Corp. pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) Each of the undersigned registrants hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of NWA Corp.'s annual report pursuant to Section 13(a) or Section 15(d)
of the Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be
a new registration statement relating to the securities offered therein, and
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the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) Each of the undersigned registrants hereby undertakes if securities
are to be offered pursuant to competitive bidding: (1) to use its best efforts
to distribute prior to the opening of bids, to prospective bidders,
underwriters and dealers, a reasonable number of copies of a prospectus which
at that time meets the requirements of section 10(a) of the Securities Act
of 1933, and relating to the securities offered at competitive bidding, as
contained in this Registration Statement, together with any supplements thereto,
and (2) to file an amendment to this Registration Statement reflecting the
results of bidding, the terms of the reoffering and related matters to the
extent required by the applicable form, not later than the first use,
authorized by the issuer after the opening of bids, of a prospectus relating
to the securities offered at competitive bidding, unless no further public
offering of such securities by the issuer and no reoffering of such
securities by purchasers is proposed to be made.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrants pursuant to the foregoing provisions, or otherwise,
the registrants have been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act
of 1933, and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by a
registrant of expenses incurred or paid by a director, officer or controlling
person of such registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the applicable registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
(e) Each of the undersigned registrants hereby undertakes to file an
application for the purpose of determining the eligibility of the trustee to
act under subsection (a) of Section 310 of the Trust Indenture Act in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b)(2) of the Trust Indenture
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Northwest
Airlines, Inc. has duly caused this Amendment to Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized in the
City of Eagan, State of Minnesota, on September 5, 2000.
NORTHWEST AIRLINES, INC.
By: /s/DOUGLAS M. STEENLAND
----------------------------------------
Douglas M. Steenland
Executive Vice President,
General Counsel and Secretary
POWER OF ATTORNEY
PURSUANT TO KNOW ALL MEN BY THESE PRESENTS, that each individual whose
signature appears below constitutes and appoints Douglas M. Steenland and
Mickey P. Foret and each of them individually, his true and lawful agent,
proxy and attorney-in-fact, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to (i) act on, sign and file with the Securities and Exchange
Commission any and all amendments (including post-effective amendments) to
this Registration Statement together with all schedules and exhibits thereto,
(ii) act on, sign and file with the Securities and Exchange Commission any
registration statement relating to this offering that is to be effective upon
filing pursuant to rule 462(b) under the Securities Act of 1933, as amended,
(iii) act on, sign and file with the Securities and Exchange Commission any
exhibits to this Registration Statement or any such registration statement or
amendments (including post-effective amendments), (iv) act on, sign and file
such certificates, instruments, agreements and other documents as may be
necessary or appropriate in connection therewith, (v) act on and file any
supplement to any prospectus included in this Registration Statement or any
such registration statement or amendment and (vi) take any and all actions
which may be necessary, or appropriate in connection therewith, granting unto
such agents, proxies and attorneys-in-fact, and each of them individually,
full power and authority to do and perform each and every act and thing
necessary or appropriate to be done, as fully for all intents and purposes as
he might or could do in person, hereby approving, ratifying and confirming
all that such agents, proxies and attorneys-in-fact, any of them or any of
his or their substitute or substitutes may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
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<PAGE>
Signature Title Date
/s/ JOHN H. DASBURG President, Chief Executive September 5, 2000
------------------------- Officer and Director
John H. Dasburg (Principal Executive Officer)
/s/ MICKEY P. FORET Executive Vice President and September 5, 2000
------------------------- Chief Financial Officer
Mickey P. Foret (Principal Financial Officer)
/s/ HIRAM A. COX Senior Vice President and September 5, 2000
------------------------- Controller (Principal
Hiram A. Cox Accounting Officer)
s/ GARY L. WILSON Chairman of the Board of September 5, 2000
------------------------- Directors
Gary L. Wilson
/s/ RAY W. BENNING, JR. Director September 5, 2000
-------------------------
Ray W. Benning, Jr.
/s/ RICHARD C. BLUM Director September 5, 2000
-------------------------
Richard C. Blum
/s/ ELAINE L. CHAO Director September 5, 2000
-------------------------
Elaine L. Chao
/s/ ALRED A. CHECCHI Director September 5, 2000
-------------------------
Alfred A. Checchi
------------------------- Director September __,2000
James G. Coulter
/s/ DORIS KEARNS GOODWIN Director September 5, 2000
-------------------------
Doris Kearns Goodwin
/s/ DENNIS F. HIGHTOWER Director September 5, 2000
-------------------------
Dennis F. Hightower
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<PAGE>
/s/ GEORGE J. KOURPIAS Director September 5, 2000
-------------------------
George J. Kourpias
/s/ FREDERIC V. MALEK Director September 5, 2000
-------------------------
Frederic V. Malek
/s/ WALTER F. MONDALE Director September 5, 2000
-------------------------
Walter F. Mondale
/s/ V. A. RAVINDRAN Director September 5, 2000
-------------------------
V. A. Ravindran
/s/ MICHAEL G. RISTOW Director September 5, 2000
-------------------------
Michael G. Ristow
_____________________ Director September __,2000
Leo M. van Wijk
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Northwest
Airlines Corporation has duly caused this Amendment to Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized in
the City of Eagan, State of Minnesota, on September 5, 2000.
NORTHWEST AIRLINES CORPORATION
By: /s/ DOUGLAS M. STEENLAND
--------------------------
Douglas M. Steenland
Executive Vice President,
General Counsel and Secretary
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<PAGE>
POWER OF ATTORNEY
PURSUANT TO KNOW ALL MEN BY THESE PRESENTS, that each individual whose
signature appears below constitutes and appoints Douglas M. Steenland and
Mickey P. Foret and each of them individually, his true and lawful agent,
proxy and attorney-in-fact, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to (i) act on, sign and file with the Securities and Exchange
Commission any and all amendments (including post-effective amendments) to
this Registration Statement together with all schedules and exhibits thereto,
(ii) act on, sign and file with the Securities and Exchange Commission any
registration statement relating to this offering that is to be effective upon
filing pursuant to rule 462(b) under the Securities Act of 1933, as amended,
(iii) act on, sign and file with the Securities and Exchange Commission any
exhibits to this Registration Statement or any such registration statement or
amendments (including post-effective amendments), (iv) act on, sign and file
such certificates, instruments, agreements and other documents as may be
necessary or appropriate in connection therewith, (v) act on and file any
supplement to any prospectus included in this Registration Statement or any
such registration statement or amendment and (vi) take any and all actions
which may be necessary, or appropriate in connection therewith, granting unto
such agents, proxies and attorneys-in-fact, and each of them individually,
full power and authority to do and perform each and every act and thing
necessary or appropriate to be done, as fully for all intents and purposes as
he might or could do in person, hereby approving, ratifying and confirming
all that such agents, proxies and attorneys-in-fact, any of them or any of
his or their substitute or substitutes may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ JOHN H. DASBURG President, Chief Executive September 5, 2000
------------------------- Officer and Director
John H. Dasburg (Principal Executive Officer)
/s/ MICKEY P. FORET Executive Vice President and September 5, 2000
------------------------- Chief Financial Officer
Mickey P. Foret (Principal Financial Officer)
/s/ HIRAM A. COX Senior Vice President and September 5, 2000
------------------------- Controller (Principal
Hiram A. Cox Accounting Officer)
/s/ GARY L. WILSON Chairman of the Board of September 5, 2000
------------------------- Directors
Gary L. Wilson
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<PAGE>
/s/ RAY W. BENNING, JR. Director September 5, 2000
-------------------------
Ray W. Benning, Jr.
/s/ RICHARD C. BLUM Director September 5, 2000
-------------------------
Richard C. Blum
/s/ ELAINE L. CHAO Director September 5, 2000
-------------------------
Elaine L. Chao
/s/ALFRED A. CHECCHI Director September 5, 2000
-------------------------
Alfred A. Checchi
------------------------- Director September __,2000
James G. Coulter
/s/ DORIS KEARNS GOODWIN Director September 5, 2000
-------------------------
Doris Kearns Goodwin
/s/ DENNIS F. HIGHTOWER Director September 5, 2000
-------------------------
Dennis F. Hightower
/s/ GEORGE J. KOURPIAS Director September 5, 2000
-------------------------
George J. Kourpias
/s/ FREDERIC V. MALEK Director September 5, 2000
-------------------------
Frederic V. Malek
/s/ WALTER F. MONDALE Director September 5, 2000
-------------------------
Walter F. Mondale
/s/ V. A. RAVINDRAN Director September 5, 2000
-------------------------
V. A. Ravindran
/s/ MICHAEL G. RISTOW Director September __,2000
-------------------------
Michael G. Ristow
------------------------- Director September __,2000
Leo M. van Wijk
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<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
------- -----------
Exhibit 1(a) Form of Underwriting Agreement for debt securities or
warrants to Purchase debt securities of Northwest (filed as
Exhibit 1(a) to Registration Statement on Forms-3 (File No.
333-79215, and hereinafter, "Registration Statement No. 33-
79125") No. 33-79215 and incorporated herein by reference).
Exhibit 1(b) Form of Underwriting Agreement for Pass Through
Certificates of Northwest (filed as Exhibit 1(b) to
Registration No. 333-79215 and incorporated herein by
reference).
Exhibit 4(a) Senior Debt Securities Indenture, dated as of March 1,
1997, among Northwest, Old NWA Corp. and State Street Bank
and Trust Company ("State Street"), as Trustee, relating to
the Senior debt securities of Northwest, as supplemented by
Supplemental Indenture, dated as of November 20, 1998,
among NWA Corp., Old NWA Corp., Northwest, and State
Street, as Trustee, and Second Supplemental Indenture,
dated as of February 25, 1999, among NWA Corp., Old NWA
Corp., Northwest and State Street, as Trustee (filed as
Exhibit 4(a) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(b) Form of Subordinated Debt Securities Indenture among
Northwest, NWA Corp. and State Street, as Trustee, relating
to the Subordinated Debt Securities of Northwest (filed as
Exhibit 4(b) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(c) Form of Senior Debt Securities of Northwest (filed as
Exhibit 4(c) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(d) Form of Subordinated Debt Securities of Northwest (filed as
Exhibit 4(d) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(e) Form of Warrant Agreement for warrants to Purchase Debt
Securities of Northwest that are Sold Attached to Debt
Securities of Northwest (filed as Exhibit 4(e) to
Registration Statement No. 333-79215 and incorporated
herein by reference).
Exhibit 4(f) Form of Warrant to Purchase Debt Securities of Northwest
that are Sold Attached to Debt Securities of Northwest
(included as part of Exhibit 4(e)).
Exhibit 4(g) Form of Warrant Agreement for warrants to Purchase Debt
Securities of Northwest that are Sold Alone (filed as
Exhibit 4(g) to Registration Statement No. 333-79215 and
incorporated herein by reference).
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<PAGE>
Exhibit 4(h) Form of Warrant to Purchase Debt Securities of Northwest
that are Sold Alone (included as part of Exhibit 4(g)).
Exhibit 4(i) Pass Through Trust Agreement dated June 3, 1999 among NWA
Corp., Northwest and State Street, Bank and Trust Company
of Connecticut, National Association ("State Street
Connecticut") as Trustee, relating to Pass Through
Certificates of Northwest (filed as Exhibit 4(i) to
Registration No. 333-79215 and incorporated herein by
reference).
Exhibit 4(j) Form of Pass Through Certificate included in Exhibit 4(i).
Exhibit 4(k) Form of Bond (filed as Exhibit 4.3 to NWA Corp's Quarterly
Report on Form 10-Q for the three months ended September
30, 1999 and incorporated herein by reference).
Exhibit 4(l) Restated Certificate of Incorporation of NWA Corp. (filed
as Exhibit 4(k) to Registration Statement No. 333-79215)
and incorporated herein by reference).
Exhibit 4(m) Amended and Restated By-Laws of NWA Corp. (filed as Exhibit
4(l) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(n) Restated Certificate of Incorporation of Northwest (filed
as Exhibit 4(m) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(o) Amended and Restated Bylaws of Northwest (filed as Exhibit
4(n) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 4(p) Certificate of Designation of Series C Preferred Stock of
NWA Corp. (included in Exhibit 4(l)).
Exhibit 4(q) Certificate of Designation of Series D Junior Participating
Preferred Stock of NWA Corp. (included in Exhibit 4(k)).
Exhibit 4(r) The Registrants hereby agree to furnish to the Commission,
upon request, copies of certain instruments defining the
rights of holders of long-term debt of the kind described
in Item 601(b)(4) of Regulation S-K.
Exhibit 5** Opinion of Simpson Thacher & Bartlett as to the legality of
the Securities.
Exhibit 8** Tax Opinion of Cadwalader, Wickersham & Taft relating to
Pass Through Certificates.
Exhibit 23(a)* Consent of Ernst & Young LLP.
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Exhibit 23(b) Consent of Simpson Thacher & Bartlett (included as part of
Exhibit 5).
Exhibit 23(c) Consent of Cadwalader, Wickersham & Taft (included as part
of Exhibit 8).
Exhibit 24 Powers of Attorney (included in signature pages of this
Registration Statement).
Exhibit 25(a) Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), of
State Street, as Trustee under the Senior Debt Securities
Indenture of Northwest and NWA Corp. (filed as Exhibit
25(a) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 25(b) Form T-1 Statement of Eligibility under the Trust Indenture
Act of State Street, as Trustee under the Subordinated Debt
Securities Indenture of Northwest and NWA Corp. (filed as
Exhibit 25(b) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 25(c) Form T-1 Statement of Eligibility under the Trust Indenture
Act of State Street Connecticut, as Trustee under the Pass
Through Trust Agreement of Northwest and NWA Corp (filed as
Exhibit 25(c) to Registration Statement No. 333-79215 and
incorporated herein by reference).
Exhibit 99(a) Trustee Parent Guarantee of State Street in favor of State
Street Connecticut in connection with the Pass Through
Trust Agreement of Northwest and NWA Corp. (filed as
Exhibit 99(a) to Registration No. 333-79215 and
incorporated herein by reference).
___________
* Filed herewith.
** To be filed by amendment.
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