SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 4
TO
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Northwest Airlines Corporation
- --------------------------------------------------------------------------------
(Name of Issuer)
Class A Common Stock, par value
$.01 per share
-------------------------------
(Title of Class of Securities)
667280-10-1
-----------------------------------------------
(CUSIP Number)
Mr. James T. Byrne, Jr. Office of the Secretary
Bankers Trust New York Corporation,
130 Liberty Street, New York, NY 10006
Tel. (212) 250-2500
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
September 29, 1997
- --------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If a filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
<PAGE>
- ---------------------
CUSIP NO. 667280-10-1
- ---------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bankers Trust New York Corporation ("BTNY")
I.R.S. No. 13-6180473
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ X ]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS
See Item 3
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
[X]
- --------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 999
SHARES -----------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 0
EACH -----------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 999
WITH -----------------------------------------------------
10. SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
999
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
HC
- --------------------------------------------------------------------------------
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<PAGE>
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CUSIP NO. 667280-10-1
- ---------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BT Alex. Brown Incorporated
I.R.S. No. 13-3311934
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS
See Item 3
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
[X]
- --------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 0
SHARES -----------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 0
EACH -----------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 0
WITH -----------------------------------------------------
10. SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
0
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.0%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
BD
- --------------------------------------------------------------------------------
-3-
<PAGE>
- ---------------------
CUSIP NO. 667280-10-1
- ---------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bankers Trust Company.
I.R.S. No. 13-4941247
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ X ]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS
See Item 3
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
[X]
- --------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 85,400
SHARES -----------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 0
EACH -----------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 85,400
WITH -----------------------------------------------------
10. SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
85,400
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
BK
- --------------------------------------------------------------------------------
-4-
<PAGE>
Item 1. Security and Issuer
This statement relates to the Class A Common Stock, par value $.01 per
share (the "Common Stock"), of Northwest Airlines Corporation, a Delaware
corporation (the "Company"). The principal executive offices of the Company are
located at 2700 Lone Oak Parkway, Eagan, Minnesota 55121.
Item 2. Identity and Background
Item 2(a) through (c), Item 2(f)
This Amendment No. 4 to the Statement on Schedule 13D is being filed on
behalf of Bankers Trust New York Corporation, a New York corporation ("BTNY"),
with respect to Common Stock beneficially owned by it as principal;* BT Alex.
Brown Incorporated, a Delaware corporation ("BT Incorporated"); and Bankers
Trust Company, a New York banking corporation ("BTCo."), with respect to Common
Stock beneficially held as trustee for various employee benefit plans and in
discretionary customer and commingled accounts. Each of BTNY, BT Incorporated
and BTCo. has its principal place of business at 130 Liberty Street, New York,
New York 10006. The principal business of BTNY is to be a bank holding company,
the principal business of BT Incorporated is to engage in broker-dealer
activities and the principal business of BTCo. is to engage in banking and
related activities. BTCo. and BT Incorporated are wholly-owned subsidiaries of
BTNY.
--------
* As described in Item 4, BTNY is a party to the Second Amended and Restated
Investor Stockholders' Agreement, dated as of December 23, 1993, as
amended by Amendments, dated as of January 6, 1995, January 25, 1995, and
September 29, 1997 respectively (as so amended, the "1993 Stockholders'
Agreement"), and the Stockholders' Agreement, dated as of September 9,
1994, as amended by an Amendment, dated as of January 25, 1995 (as so
amended, the "1994 Stockholders' Agreement" and, together with the 1993
Stockholders' Agreement, the "Stockholders' Agreements"), among the
parties listed therein. As a result of being a party to the Stockholders'
Agreements, BTNY may be deemed a member of a "group" for purposes of
Section 13(d) of the Securities Exchange Act of 1934 (the "Exchange Act")
and the rules and regulations thereunder. BTNY hereby disclaims its
possible status as a member of a group for purposes of Section 13(d) and
disclaims beneficial ownership of any shares of Common Stock beneficially
owned by any other party to the Stockholders' Agreements.
-5-
<PAGE>
The name, residence or business address, citizenship, principal
occupation or employment, and the name and address of any corporation or other
organization in which such employment is conducted of each of the executive
officers and directors of BTNY, BT Incorporated and BTCo. are set forth in Annex
A attached hereto and incorporated into this Item 2 by reference.
Item 2(d) and (e)
Except as disclosed in Annex B hereto, neither BTNY, BT Incorporated or
BTCo. nor, to the best knowledge and belief of BTNY, BT Incorporated and BTCo.,
any of the persons identified in Annex A, have during the last five years been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgement, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
On January 25, 1995, pursuant to the Agreement, dated December 16,
1994, as amended by an Amendment, dated as of January 25, 1995 (as so amended,
the "Exchange Agreement"), between BTNY and the Company, BTNY acquired
beneficial ownership of 2,050,000 shares of Class B Common Stock, par value $.01
per share (the "Class B Common Stock"), through the exchange of 1,727 shares of
the Company's Series B Preferred Stock, liquidation preference $50,000 per share
(the "Preferred Stock"). The shares of Class B Common Stock are convertible, at
the option of BTNY, into shares of Common Stock on the basis of one share of
Class B Common Stock per share of Class A Common Stock. Any shares of Common
Stock received by BTNY are not subject to any contractual restrictions on
transfer if such shares are sold pursuant to Rule 144 under the Securities Act
of 1933 (the "Securities Act") or in a registered public offering.
As of September 29, 1997, BT Incorporated did not beneficially own any
shares of Common Stock.
As of September 29, 1997, BTCo beneficially owned 85,400 shares of
Common Stock. These shares were held by BTCo. as trustee for various employee
benefit plans and in discretionary client and commingled accounts. Accordingly,
no consideration was paid by BTCo. in connection with the acquisition of these
shares of Common Stock for the accounts of the employee benefit plans or its
clients.
-6-
<PAGE>
Pursuant to an Amendment to the Second Amended and Restated Investor
Stockholders' Agreement, dated as of September 29, 1997 (the "Amendment"), on
September 29, 1997, Koninklijke Luchtvaart Maatschappij N.V.("KLM")exercised its
option and purchased 2,635,020 shares of Class B Common Stock from BTNY in
exchange for 654.4002 shares of Series A Preferred Stock, par value $.01 per
share (the "Series A Preferred Shares"), and 218.1001 shares of Series B
Preferred Shares, par value $.01 per share (the "Series B Preferred Shares" and,
together with the Series A Preferred Shares, the "Preferred Shares"). Pursuant
to a BTNY Preferred Stock Repurchase Agreement, dated as of September 29, 1997
(the "Purchase Agreement"), BTNY sold the Preferred Shares to the Company for a
cash purchase of $76,246.81 for each Preferred Share.
The foregoing summaries of the Amendment and the Purchase Agreement are
qualified in their entirety by reference to the copies of the Amendment and
Purchase Agreement, which are filed as exhibits hereto and are incorporated by
reference into this Item 3.
Item 4. Purpose of Transaction
BTNY acquired the shares of Class B Common Stock for investment.
As of the date of this Amendment No. 4 to the Statement on Schedule
13D, none of BTNY, BT Incorporated or BTCo. has any plan or proposal which
relates to or would result in any of the actions set forth in parts (a) through
(j) of Item 4 of Schedule 13D, other than the following:
1. The Stockholders' Agreements provide each of the parties thereto,
subject to certain exceptions, with certain "tag-along" rights in the event that
another party to the Stockholders' Agreements proposes to sell Common Stock to a
third party in a transaction other than in a public offering or pursuant to Rule
144.
2. The Stockholders' Agreements provide each of the parties thereto,
subject to certain exceptions, with rights of first refusal and reoffer. As a
result, if any party to the Stockholders' Agreements proposes to sell its shares
of Common Stock to a third party, it must first offer the shares on
substantially the same terms to the other stockholders who are party to the
Stockholders' Agreements, subject to certain exceptions. Any shares of Common
Stock received by BTNY upon conversion of shares of Class B Common Stock will
not be subject to this restriction if the shares
-7-
<PAGE>
of Common Stock so received are sold pursuant to Rule 144 or in a public
offering.
3. Pursuant to the Stockholders' Agreements, the Original Investors have
agreed not to vote in favor of a merger or other business combination involving
the Company unless 60% of the voting stock of the Company held by the Original
Investors is voted in favor of such proposal.
4. BTNY is also a party to the First Amended and Restated Common Stock
Registration Rights Agreement, dated as of September 9, 1994 (the "Registration
Rights Agreement"), among the parties listed therein. The Registration Rights
Agreement provides the parties thereto with demand registration rights under
which the holders of not less than 20% of the Common Stock subject to such
agreement have the right to demand that the Company file a registration
statement with the Securities and Exchange Commission in order to register the
offering of shares of Common Stock under the Securities Act.
5. BTCo. is agent and lender under the Amended and Restated Credit
Agreement, dated as of October 11, 1996 and the Amended and Restated Credit
Agreement, dated as of October 16, 1996 (the "Credit Agreements"). The Credit
Agreements contain various affirmative and negative covenants that restrict the
Company's business and operations, including the payment of dividends, the
acquisition and issuance of equity securities and mergers, consolidations, and
sales or other dispositions of assets.
As a result of the transactions contemplated by the Amendment and
Purchase Agreement, BTNY is no longer entitled to appoint a director to the
Company's Board of Directors pursuant to the Stockholders' Agreements and KLM is
not entitled to purchase any shares of Class B Common Stock beneficially owned
by BTNY.
BTNY, BT Incorporated and BTCo. expect to evaluate on an ongoing basis
the Company's financial condition and prospects and their interests in, and
intentions with respect to, the Company. Accordingly, each of BTNY, BT
Incorporated and BTCo. reserves the right to change its plans and intentions at
any time, as it deems appropriate. In particular, each of BTNY, BT Incorporated
and BTCo. may at any time and from time to time acquire additional shares of
Common Stock or securities convertible or exchangeable for Common Stock; may
dispose of shares of Common Stock; and/or may enter into privately negotiated
derivative transactions with institutional counterparties to hedge the market
risk of some or all of its position in the shares of
-8-
<PAGE>
Common Stock. Any such transactions may be effected at any time and from time to
time. To the knowledge of BTNY, BT Incorporated and BTCO., each of the persons
listed on Annex A hereto may make the same evaluation and may have the same
reservations.
Item 5. Interest in Securities of the Issuer
Item 5(a) through (c)
As of September 29, 1997, BTNY beneficially owned 999 shares of the
Company's Class A Common Stock representing less than 1.0% of the Company's
outstanding shares of Common Stock. BTNY has the sole power to vote and dispose
of such shares of Class A Common Stock.
As of September 29, 1997, BT Incorporated did not beneficially own any
shares of Common Stock.
As of September 29, 1997, BTCo. beneficially owned 85,400 shares of
Common Stock representing less than 1.0% of the outstanding shares of Common
Stock. These shares of Common Stock are held by BTCo. as trustee for various
employee benefit plans and in discretionary client and commingled accounts.
BTCo.'s customers may withdraw the shares of Common Stock held in the
discretionary and, under certain circumstances, commingled accounts upon notice.
BTCo. has sole voting and dispositive power over the shares held by it as
trustee for the employee benefit plans and, until the shares of Common Stock are
withdrawn, sole voting and dispositive power over shares of Common Stock held in
the discretionary and commingled accounts.
Annex C to Amendment No. 4 to the Statement on Schedule 13D, which is
incorporated herein by reference, describes all transactions by BT Incorporated
in the Company's shares of Common Stock during the sixty days prior to the
filing of this Schedule 13D. Except as described herein and in Annex C, neither
BTNY, BT Incorporated or BTCo. nor, to the best knowledge and belief of BTNY, BT
Incorporated and BTCo., has any of the persons identified in Annex A hereto,
been party to any transaction in the shares of Common Stock of the Company
during the sixty-day period ending on the date of this Statement on Schedule
13D.
Item 5(d)
As discussed in Item 4, BTNY is a party to the Stockholders' Agreements
and, as a result, has certain rights with respect to the shares of Common Stock
-9-
<PAGE>
beneficially owned by the other parties thereto and such parties have certain
rights with respect to certain shares of Common Stock beneficially owned by
BTNY. BTNY disclaims beneficial ownership of the shares of Common Stock
beneficially owned by the other parties to the Stockholders' Agreements.
Item 5(e)
Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships Involving Securities of the Issuer.
Except for the Stockholders' Agreements, the Exchange Agreement, the
Registration Rights Agreement, the Credit Agreements, the Amendment and the
Purchase Agreement described above in Item 4, neither BTNY, BT Incorporated nor
BTCo. is party to any contract, arrangement, understanding or relationship
involving the shares of Common Stock.
Item 7. Materials to be Filed as Exhibits
1. The Amendment
2. The Purchase Agreement
-10-
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: October 1, 1997
Signature: BANKERS TRUST NEW YORK CORPORATION
By: /s/ James T. Byrne, Jr.
----------------------------------
James T. Byrne, Jr.
Title: Secretary
Signature: BANKERS TRUST COMPANY
By: /s/ James T. Byrne, Jr.
----------------------------------
James T. Byrne, Jr.
Title: Secretary
-11-
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: October 1, 1997
Signature: BT ALEX. BROWN INCORPORATED
By: /s/ James T. Byrne, Jr.
-----------------------------------
James T. Byrne, Jr.
Title: Secretary
-12-
<PAGE>
ANNEX A
BANKERS TRUST NEW YORK CORPORATION
BANKERS TRUST COMPANY
The following sets forth the name, mailing address, occupation
or principal business affiliation and citizenship of each director and executive
officer of BTNY. Unless otherwise indicated, each individual listed below is
also a director or executive officer of BTCo. To the best knowledge and belief
of BTNY and BTCo., none of the following persons beneficially owns any shares of
Common Stock.
<TABLE>
<CAPTION>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
--------------- ------------------------------ -----------
<S> <C> <C>
Lee A. Ault III President U.S.
1901 Avenue of the Stars Lee Ault and Company
Suite 1800
Los Angeles, CA 90067-6018
Neil R. Austrian President and Chief Operating Officer U.S.
National Football League National Football League
280 Park Avenue
17th Floor East
New York, New York 10017
George B. Beitzel Retired Senior Vice President U.S.
International Business Machines Corporation and Director
Old Orchard Road International Business Machines Corporation
Armonk, NY 10504
Phillip A. Griffiths Director U.S.
Institute for Advanced Study Institute for Advanced Study
Olden Lane
Princeton, NJ 08540
William R. Howell Chairman Emeritus U.S.
J.C. Penney Company, Inc. J.C. Penney Company, Inc.
P.O. Box 10001
Plano, TX 75301-0001
-13-
<PAGE>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
--------------- ------------------------------ -----------
Vernon E. Jordan, Jr. Senior Partner U.S.
Akin, Gump, Strauss, Hauer & Felt, LLP Akin, Gump, Strauss, Hauer & Feld, LLP
1333 New Hampshire Ave., N.W.
Washington, D.C. 20036
A.B. Krongard Vice Chairman of the Board U.S.
BT Alex. Brown Incorporated Bankers Trust Company and
One South Street, 30th Floor Bankers Trust New York Corporation
Baltimore, MD 21202
Hamish Maxwell Retired Chairman and Chief Executive Officer U.S.
Philip Morris Companies, Inc. Philip Morris Companies Inc.
100 Park Avenue
New York, NY 10017
Frank N. Newman Chairman of the Board, Chief Executive Officer U.S.
Bankers Trust Company and President
130 Liberty Street Bankers Trust Company and
New York, NY 10006 Bankers Trust New York Corporation
N.J. Nicholas Jr. Investor U.S.
15 West 53rd St., #34F
New York, NY 10019
Russell E. Palmer Chairman and Chief Executive Officer U.S.
The Palmer Group The Palmer Group
3600 Market Street
Suite 530
Philadelphia, PA 19104
Donald L. Staheli Chairman of the Board and Chief Executive Officer U.S.
Bankers Trust Company Continental Grain Company
c/o Office of the Secretary
130 Liberty Street
New York, NY 10006
Patricia Carry Stewart Former Vice President U.S.
Bankers Trust Company The Edna McConnell Clark Foundation
c/o Office of the Secretary
130 Liberty Street
New York, NY 10006
G. Richard Thoman President and Chief Operating Officer U.S.
Xerox Corporation Xerox Corporation
800 Long Ridge Road
Stamford, Ct 06904
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<PAGE>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
--------------- ------------------------------ -----------
George J. Vojta Vice Chairman U.S.
Bankers Trust Company Bankers Trust Company and
130 Liberty Street Bankers Trust New York Corporation
New York, NY 10006
EXECUTIVE OFFICERS
------------------
Mark Bieler Executive Vice President U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Senior Managing Director
130 Liberty Street Bankers Trust Company
New York, NY 10006
Mary Cirillo Executive Vice President U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Senior Managing Director
130 Liberty Street Bankers Trust Company
New York, NY 10006
Richard H. Daniel Vice Chairman, Chief Financial Officer and U.S.
Bankers Trust Company Controller
c/o Office of the Secretary Bankers Trust New York Corporation;
130 Liberty Street Vice Chairman, Chief Financial Officer
New York, NY 10006 and Controller
Bankers Trust Company
Yves C. de Balman Vice Chairman U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Co-Chairman and Chief Executive Officer
130 Liberty Street BT Alex. Brown Incorporated
New York, NY 10006
R. Kelly Doherty Vice Chairman U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Vice Chairman
130 Liberty Street Bankers Trust Company
New York, NY 10006
-15-
<PAGE>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
- ------------------------- ------------------------------ -----------
Robert A. Ferguson Executive Vice President Australian
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Senior Managing Director
130 Liberty Street Bankers Trust Company
New York, NY 10006
Joseph A. Manganello, Jr Executive Vice President and Chief Credit Officer U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Senior Managing Director and Chief Credit Officer
130 Liberty Street Banker Trust Company
New York, NY 10006
I. David Marshall Executive Vice President and Canadian
Bankers Trust Company Chief Information Officer
c/o Office of the Secretary Bankers Trust New York Corporation;
130 Liberty Street Senior Managing Director and
New York, NY 10006 Chief Information Officer
Bankers Trust Company
Rodney McLauchlan Executive Vice President U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary
130 Liberty Street
New York, NY 10006
Mayo A. Shattuck, III Vice Chairman U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Co-Chairman and Co-Chief Executive Officer
130 Liberty Street BT Alex. Brown Incorporated
New York, NY 10006
Melvin A. Yellin Executive Vice President and General Counsel U.S.
Bankers Trust Company Bankers Trust New York Corporation;
c/o Office of the Secretary Senior Managing Director and General Counsel
130 Liberty Street Bankers Trust Company
New York, NY 10006
</TABLE>
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<PAGE>
BT ALEX. BROWN INCORPORATED
The following sets forth the name, mailing address, occupation or
principal business affiliation and citizenship of each director and executive
officer of BT Alex. Brown Incorporated. To the best knowledge and belief of BT
Alex. Brown Incorporated, none of the following persons beneficially owns any
shares of Common Stock.
<TABLE>
<CAPTION>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
- ------------------------- ------------------------------ -----------
<S> <C> <C>
Yves C. de Balman Co-Chairman and Chief Executive Officer U.S..
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 1006
Geralyn A. Fitzgerald Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Alexander P. Frick Executive Vice President U.S.
c/o Office of the Secretary Bankers Trust New York Corporation
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Benjamin H. Griswold, IV Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Donald R. Heacock Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
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<PAGE>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
- ------------------------- ------------------------------ -----------
Duncan P. Hennes Senior Vice President U.S.
c/o Office of the Secretary Bankers Trust New York Corporation
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Charles F. Kiley Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Glen S. Lewy Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Rodney McLauchlan Executive Vice President U.S.
c/o Office of the Secretary Bankers Trust New York Corporation
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Richard A. Marin Senior Vice President U.S.
c/o Office of the Secretary Bankers Trust New York Corporation
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Terence J. Mogan Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
W. Gar Richlin Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
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<PAGE>
NAME AND OCCUPATION OR
MAILING ADDRESS PRINCIPAL BUSINESS AFFILIATION CITIZENSHIP
- ------------------------- ------------------------------ -----------
Howard M. Schneider President U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Thomas Schweitzer, Jr. Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
Mayo A. Shattuck, III Co-Chairman and Co-Chief Executive Officer U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
J. Edward Virtue Managing Director U.S.
c/o Office of the Secretary BT Alex. Brown Incorporated
BT Alex. Brown Incorporated
130 Liberty Street
New York, NY 10006
</TABLE>
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<PAGE>
ANNEX B
BTCo., BTNY and BT Incorporated, are subject to a Written Agreement,
dated December 4, 1994 (the "Written Agreement"), with the Federal Reserve Bank
of New York and a Memorandum of Understanding, dated December 21, 1994 (the
"Memorandum"), with the New York State Banking Department. The Written Agreement
and Memorandum are described in BTNY's Forms 8-K, dated December 4, 1994 and
January 19, 1994, respectively. These Forms 8-K are hereby incorporated by
reference into this Annex B. On December 9, 1996, BTNY filed a Current Report on
Form 8-K announcing that the Written Agreement and the Memorandum had been
terminated by the Federal Reserve Bank of New York and the New York State
Banking Department, respectively.
BT Incorporated is also subject to an Order, dated December 22, 1994,
of the Securities and Exchange Commission and an Order dated December 22, 1994,
of the Commodity Futures Trading Commission. These Orders are included in and
described in BTNY's Form 8-K, dated December 22, 1994. This Form 8-K is hereby
incorporated by reference into this Annex B.
-20-
<PAGE>
ANNEX C
None of BTCo., BTNY or BT Incorporated had any transactions in shares
of Common Stock within the last sixty days.
-21-
AMENDMENT TO SECOND AMENDED AND
RESTATED INVESTOR STOCKHOLDERS' AGREEMENT
AMENDMENT, dated as of September 29, 1997 (this "Amendment"), to the
Second Amended and Restated Investor Stockholders' Agreement, dated as of
December 23, 1993 (as such agreement has been amended, supplemented or otherwise
modified from time to time prior to the date hereof, the "Stockholders'
Agreement"), by and among Alfred A. Checchi, the A Trust created pursuant to a
trust agreement dated May 23, 1984 with Gary L. Wilson as trustee, the K Trust
created pursuant to a trust agreement dated May 23, 1984 with Gary L. Wilson as
trustee, the Trust created pursuant to a trust agreement dated September 1, 1985
with Gary L. Wilson as trustee (each such trust collectively known as the
"Checchi Family Trusts"; the Checchi Family Trusts and Alfred A. Checchi
together known as the "Checchi Family"); Gary L. Wilson, Derek M. Wilson,
Christopher D. Wilson (together the "Wilson Family"); Frederic V. Malek,
Frederic W. Malek, Michelle A. Malek (together the "Malek Family"); the
Wilson-Thornhill Foundation created under Trust Agreement dated December 24,
1994; Bankers Trust New York Corporation ("BTNY"); Koninklijke Luchtvaart
Maatschappij N.V. ("KLM"); Richard C. Blum & Associates - NWA Partners, L.P.,
formerly known as Wings Associates, L.P. ("Blum" and together with each of the
foregoing parties, the "Investor Stockholders"); and Northwest Airlines
Corporation, a Delaware corporation (the "Company").
W I T N E S S E T H:
WHEREAS, under Section 17 of the Stockholders' Agreement, KLM was
granted an option to purchase shares of Common Stock (the "KLM Option") from
each of Blum, BTNY, the Checchi Family, the Malek Family, Bright Star
Investments Limited and its affiliate Paracor Finance Inc., the permitted
transferees of Wings Acquisition Investor Limited (collectively, "Bright Star"),
and the Wilson Family, upon the terms and subject to the conditions set forth
therein;
WHEREAS, KLM has previously exercised the KLM Option granted to KLM by
Bright Star in connection with purchasing Bright Star's shares of Common Stock;
WHEREAS, in connection with entering into the Common Stock Repurchase
Agreement, dated as of September 29, 1997 (the "Common Stock Agreement"),
between KLM and the Company, the parties hereto desire (x) to accelerate the
date of the KLM exercise date for the KLM Option granted to KLM by each of Blum
and BTNY under Section 17 of the Stockholders' Agreement and (y) to cancel the
KLM Option granted to KLM by each of the Checchi Family, the Wilson Family and
the Malek Family under Section 17 of the Stockholders' Agreement;
WHEREAS, on the date hereof, KLM owns (i) 1,308.8 shares of the
Company's Series A Preferred Stock, par value $.01 per share (the "Series A
Preferred
<PAGE>
2
Stock"), (ii) 436.2 shares of the Company's Series B Preferred Stock, par value
$.01 per share (the "Series B Preferred Stock"), and (iii) 21,684,099 shares of
the Company's Class A Common Stock, par value $.01 per share (the "Class A
Common Stock", and together with the Company's Class B Common Stock, par value
$.01 per share (the "Class B Common Stock"), the "Common Stock");
WHEREAS, concurrently with the Initial Closing Date (as defined in the
Common Stock Agreement), upon the terms and subject to the conditions set forth
herein, KLM will exercise its right to purchase, and will purchase, pursuant to
Section 17 of the Stockholders' Agreement (as such Section is amended by this
Amendment) (x) from Blum, 658,755 additional shares of Class A Common Stock in
exchange for 163.6001 shares of Series A Preferred Stock and 54.5250 shares of
Series B Preferred Stock and (y) from BTNY, 2,635,020 shares of Class B Common
Stock in exchange for 654.4002 shares of Series A Preferred Stock and 218.1001
shares of Series B Preferred Stock, following which purchase KLM will own
22,342,854 shares of Class A Common Stock, 2,635,020 shares of Class B Common
Stock (and a total of 24,977,874 shares of Common Stock), 490.7997 shares of
Series A Preferred Stock and 163.5749 shares of Series B Preferred Stock;
WHEREAS, upon the terms and subject to the conditions set forth in the
Common Stock Agreement, KLM has agreed to sell to the Company, and the Company
has agreed to purchase from KLM, all 24,977,874 shares of Common Stock (in four
installments over a three-year period, with all 2,635,020 shares of Class B
Common Stock if not otherwise converted to be sold in the last installment), and
upon the terms and subject to the conditions set forth in the Preferred Stock
Repurchase Agreement, dated as of September 29, 1997 (the "Preferred Stock
Agreement"), between KLM and the Company, all 490.7997 shares of Series A
Preferred Stock (at the Initial Closing Date) and all 163.5749 shares of Series
B Preferred Stock (at the Initial Closing Date); and
WHEREAS, under Section 15(b) of the Stockholders' Agreement, a written
instrument signed by the Required Percentage is required in order to amend the
provisions of the Stockholders' Agreement in the manner contemplated by this
Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Amendment to Section 17 of the Stockholder's Agreement. Section 17
of the Stockholders' Agreement is hereby deleted in its entirety and substituted
in lieu thereof is the following:
"17. KLM Option. (a) Each of Blum and BTNY (the "Option Stockholders")
hereby grant to KLM the option (the "KLM Option"), exercisable only in
connection with the consummation of the transactions contemplated to occur
on the Initial Closing
<PAGE>
3
Date under (and as defined in) that certain Common Stock Purchase
Agreement, dated as of September 29, 1997 (the "Common Stock Agreement"),
between the Company and KLM, to purchase (x) in the case of Blum, 658,755
shares of the Company's Class A Common Stock, and (y) in the case of BTNY,
2,635,020 shares of the Company's Class B Common Stock, for an aggregate of
3,293,775 shares of Common Stock (collectively, the "Option Shares"), at
the exercise price for the Option Shares set forth in Section 17(b) below;
provided, that in each case, in the event that the number of shares is
adjusted by subdivision, combination, reclassification, recapitalization,
stock split or stock dividend, the KLM Option Exercise Price (as defined
below) shall be adjusted proportionately to any such adjustment in the
number of shares. The KLM Option shall be automatically exercised, in whole
and not in part, without any further action by any party, concurrently with
the consummation of the transactions contemplated to occur under the Common
Stock Agreement on the Initial Closing Date (the date on which the KLM
Option is exercised being referred to as the "KLM Option Exercise Date").
(b) The exercise price for the Option Shares subject to the KLM Option
(the "KLM Option Exercise Price") shall be payable by KLM in shares of
Series A Preferred Stock and Series B Preferred Stock that it owns as of
the KLM Option Exercise Date as follows (based on the full exercise of the
KLM Option): (i) Blum shall receive 163.6001 shares of Series A Preferred
Stock and 54.5250 shares of Series B Preferred Stock; and (ii) BTNY shall
receive 654.4002 shares of Series A Preferred Stock and 218.1001 shares of
Series B Preferred Stock. Series A Preferred Stock and Series B Preferred
Stock transferred to the Option Stockholders pursuant to the KLM Option
shall include any accrued and unpaid dividends accruing thereon.
(c) On the KLM Option Exercise Date, (i) each Option Stockholder agrees
to transfer, assign and deliver to KLM a certificate or certificates
representing the Option Shares to be sold by such Option Stockholder, and
KLM agrees to transfer, assign and deliver to such Option Stockholder, as
payment of the applicable KLM Option Exercise Price for such Option Shares,
a certificate or certificates representing the shares of Series A Preferred
Stock and Series B Preferred Stock comprising such KLM Option Exercise
Price. Such certificates shall be duly endorsed in blank or accompanied by
stock powers duly executed in blank, with all necessary stock transfer
stamps affixed. The closing for the purchase and sale of the Option Shares
shall occur at the time and place of the Initial Closing Date referred to
in Section 17(a) above.
(d) Notwithstanding any other provision of this Agreement, upon the
effectiveness of the amendment to this Agreement dated as of September 29,
1997 (the "September 1997 Amendment") (i) the KLM Option previously granted
under this Agreement (prior to the effectiveness of the September 1997
Amendment) with respect to certain shares held by the Checchi Family, the
Malek Family and the Wilson Family will be cancelled on an unexercised
basis without any liability in respect thereof, and
<PAGE>
4
(ii) neither KLM nor any Investor Stockholder shall have any obligations or
rights with respect to any "Put Options" arrangements that were previously
granted under this Agreement (prior to the effectiveness of the September
1997 Amendment), which Put Options shall be deemed cancelled on an
unexercised basis without any liability in respect thereof."
2. Additional Amendments to Stockholders' Agreement. Immediately
following the consummation of all of the transactions contemplated to occur at
the Initial Closing Date under the Common Stock Agreement (including for
purposes of this Section 2, the consummation of the transactions contemplated by
the exercise of the KLM Option in the manner provided by Section 17 of the
Stockholders' Agreement (as amended by this Amendment)), each of KLM, the other
Investor Stockholders and the Company agrees that KLM shall thereupon be deleted
from and shall cease to be a party to the Stockholders' Agreement and KLM shall
have no rights and no obligations thereunder. The Stockholders' Agreement shall
be further amended by deleting therefrom any and all provisions with respect to
obligations owed by, and rights accruing to, KLM under the Stockholders'
Agreement.
3. Representations and Warranties of KLM. KLM hereby represents and
warrants to each of BTNY, Blum and the Company that, as of the date hereof and
at the Initial Closing Date (before giving effect to the exercise of the KLM
Option on such date), KLM has good and valid title to its (i) 1,308.8 shares of
the Series A Preferred Stock, (ii) 436.2 shares of the Series B Preferred Stock,
and (iii) 21,684,099 shares of the Class A Common Stock, free and clear of any
mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance,
lien (statutory or other), other charge or security interest or any preference,
priority or other arrangement or preferential arrangement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement having substantially the same economic effect as any of the
foregoing), but other than those established under the Common Stock Agreement
and the Preferred Stock Agreement.
4. Representations and Warranties of BTNY. BTNY hereby represents and
warrants to each of KLM, Blum and the Company that, as of the date hereof and at
the Initial Closing Date (before giving effect to the exercise of the KLM Option
on such date), BTNY has good and valid title to its (i) 999 shares of the Class
A Common Stock and (ii) 2,635,020 shares of the Class B Common Stock, free and
clear of any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), other charge or security interest or any
preference, priority or other arrangement or preferential arrangement of any
kind or nature whatsoever (including, without limitation, any conditional sale
or other title retention agreement having substantially the same economic effect
as any of the foregoing), but other than those established under the BTNY
Preferred Stock Repurchase Agreement, dated as of September 29, 1997, between
BTNY and the Company.
5. Representations and Warranties of Blum. Blum hereby represents and
warrants to each of KLM, BTNY and the Company that, as of the date hereof and at
the Initial
<PAGE>
5
Closing Date (before giving effect to the exercise of the KLM Option on such
date), Blum has good and valid title to its (i) 5,396,643 shares of the Class A
Common Stock and (ii) 1727 shares of the Series B Preferred Stock, free and
clear of any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), other charge or security interest or any
preference, priority or other arrangement or preferential arrangement of any
kind or nature whatsoever (including, without limitation, any conditional sale
or other title retention agreement having substantially the same economic effect
as any of the foregoing), but other than those established under the Blum
Preferred Stock Repurchase Agreement, dated as of September 29, 1997, between
Blum and the Company.
6. Definitions. Capitalized terms used but not otherwise defined herein
are used herein as defined in the Stockholders' Agreement.
7. CHOICE OF LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED THEREIN. THE PARTIES TO THIS AMENDMENT HEREBY
AGREE TO SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF
NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AMENDMENT.
8. Counterparts. This Amendment may be executed in two or more
counterparts, and by different parties on separate counterparts, each of which
shall be deemed an original, but all of which shall constitute one and the same
instrument.
9. Effectiveness. Upon the execution of this Amendment by the Required
Percentage of Investor Stockholders, this Amendment shall become effective
concurrently with the consummation of the transactions contemplated under the
Common Stock Agreement on the Initial Closing Date.
<PAGE>
IN WITNESS WHEREOF, each of the undersigned has caused this Amendment
to be duly executed on its behalf as of the date first written above.
NORTHWEST AIRLINES CORPORATION
By:_________________________________
Name:
Title
---------------------------------------
Alfred A. Checchi
---------------------------------------
Gary L. Wilson
K Trust created under Trust Agreement dated May 23,
1984
---------------------------------------
Gary L. Wilson, Trustee
---------------------------------------
Frederic V. Malek
A Trust created under Trust Agreement dated May 23,
1984
---------------------------------------
Gary L. Wilson, Trustee
<PAGE>
Trust created under Trust Agreement dated September
1, 1985
---------------------------------------
Gary L. Wilson, Trustee
Wilson-Thornhill Foundation created under Trust
Agreement dated December 24, 1994
---------------------------------------
Gary L. Wilson, Trustee
---------------------------------------
Derek M. Wilson
---------------------------------------
Christopher D. Wilson
---------------------------------------
Frederic W. Malek
---------------------------------------
Michelle A. Malek
BANKERS TRUST NEW YORK CORPORATION
By:__________________________________
Name:
Title:
<PAGE>
KONINKLIJKE LUCHTVAART MAATSCHAPPIJ N.V.
By:__________________________________
Name:
Title:
By:__________________________________
Name:
Title:
RICHARD C. BLUM & ASSOCIATES - NWA
PARTNERS, L.P.
by: Richard C. Blum & Associates, L.P., its
General Partner
by: Richard C. Blum & Associates, Inc., its
General Partner
By:__________________________________
Name:
Title:
------------------------------------
BTNY PREFERRED STOCK REPURCHASE AGREEMENT
BETWEEN
NORTHWEST AIRLINES CORPORATION
AND
BANKERS TRUST NEW YORK CORPORATION
DATED AS OF SEPTEMBER 29, 1997
------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS.................................1
1.1 Defined Terms...........................................................1
ARTICLE II
DELIVERY AND PURCHASE OF SHARES.....................3
2.1 Purchase and Sale of Shares.............................................3
2.2 Closing of Purchase and Sale of Shares..................................4
ARTICLE III
REPRESENTATIONS AND WARRANTIES......................4
3.1 Representations and Warranties of BTNY..................................4
3.2 Representations and Warranties of NWA Corp..............................5
ARTICLE IV
ACKNOWLEDGMENTS.............................6
4.1 Acknowledgments.........................................................6
ARTICLE V
CONDITIONS PRECEDENT...........................7
5.1 Conditions to Closing...................................................7
ARTICLE VI
GENERAL PROVISIONS............................8
6.1 Termination or Abandonment of Agreement.................................8
6.2 Expenses................................................................9
6.3 Execution in Counterparts...............................................9
6.4 Notices.................................................................9
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<PAGE>
Page
----
6.5 Governing Law..........................................................10
6.6 Titles and Headings....................................................10
6.7 Successors and Assigns.................................................10
6.8 Entire Agreement; No Oral Waiver.......................................10
6.9 Severability...........................................................11
6.10 No Third-Party Rights..................................................11
6.11 Submission To Jurisdiction.............................................11
6.12 Remedies...............................................................11
6.13 Brokers and Finders....................................................11
6.14 Further Assurances.....................................................12
-ii-
<PAGE>
BTNY PREFERRED STOCK REPURCHASE AGREEMENT dated as of September 29,
1997 between NORTHWEST AIRLINES CORPORATION, a Delaware corporation ("NWA
Corp."), and BANKERS TRUST NEW YORK CORPORATION, a New York corporation
("BTNY").
W I T N E S S E T H :
WHEREAS, on the date hereof, BTNY owns 999 shares of NWA Corp.'s Class
A Common Stock, par value $.01 per share (the "Class A Common Stock"), and
2,635,020 shares of NWA Corp.'s Class B Common Stock, par value $.01 per share
(the "Class B Common Stock");
WHEREAS, concurrently with the Initial Closing Date (as defined in the
Common Stock Agreement (as hereinafter defined)), in accordance with the
provisions set forth in the Amendment to the Stockholders' Agreement (as
hereinafter defined), Koninklijke Luchtvaart Maatschappij N.V., a Netherlands
corporation ("KLM"), will exercise its right to purchase, and will purchase,
pursuant to Section 17 of the Stockholders' Agreement (as hereinafter defined)
(x) from Richard C. Blum & Associates - NWA Partners, L.P. ("Blum"), 658,755
shares of Class A Common Stock in exchange for 163.6001 shares of Series A
Preferred Stock and 54.5250 shares of NWA Corp.'s Series B Preferred Stock, par
value $.01 per share (the "Series B Preferred Stock"), and (y) from BTNY,
2,635,020 shares of Class B Common Stock in exchange for 654.4002 shares of
Series A Preferred Stock and 218.1001 shares of Series B Preferred Stock,
following which purchase BTNY will own (i) 999 shares of Class A Common Stock,
(ii) 654.4002 shares of Series A Preferred Stock (the "Series A Preferred
Shares") and (iii) 218.1001 shares of Series B Preferred Stock (the "Series B
Preferred Shares", together with the Series A Preferred Shares, the "Preferred
Shares"); and
WHEREAS, upon the terms and subject to the conditions set forth herein,
BTNY wishes to sell to NWA Corp., and NWA Corp. wishes to purchase from BTNY,
the Preferred Shares on the Initial Closing Date;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms defined in the
recitals to this Agreement have the meanings assigned to such terms therein and
the following terms have the following meanings:
<PAGE>
"Affiliate" when used with respect to another Person, means any Person
who is, whether directly or indirectly, through one or more intermediaries,
controlling, controlled by or under common control with such Person.
"Agreement" means this BTNY Preferred Stock Repurchase Agreement, as
amended, supplemented or otherwise modified from time to time in accordance
with its terms.
"Amendment to the Stockholders' Agreement" means the agreement in the
form of Exhibit A to the Common Stock Agreement which amends the
Stockholders' Agreement and provides for (i) the acceleration of the
vesting of the KLM Option (as defined in the Stockholders' Agreement) in
respect of shares of Class A Common Stock subject to such option that are
held by Blum and BTNY, and the exercise by KLM of such KLM Option with
respect to such shares and the purchase of such shares concurrently with
the Initial Closing Date, (ii) the termination of the KLM Option for the
other Option Stockholders and the termination of the Put Option (as each
such term is defined in the Stockholders' Agreement) for all of the Option
Stockholders and (iii) immediately following the consummation of the
transactions contemplated by this Agreement on the Initial Closing Date,
the termination of all of KLM's other rights and obligations under the
Stockholders' Agreement.
"beneficially own" has the meaning given such term in Rule 13d-3 under
the Exchange Act (as defined below), as in effect on the date hereof. As
used herein, the phrases "beneficial ownership" and "beneficial owner" have
correlative meanings.
"Board of Directors" means the board of directors of NWA Corp. or any
successor corporation.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which banks are required or authorized by law to be closed in New
York, New York or in Minneapolis, Minnesota.
"Cash" means Dollars paid in immediately available funds.
"Common Stock Agreement" means the Common Stock Repurchase Agreement
dated as of September 29, 1997 between KLM and NWA Corp., entered into
concurrently with this Agreement.
"Dollars" and "$" mean lawful currency of the United States of America.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), other charge or
security interest;
-2-
<PAGE>
or any preference, priority or other arrangement or preferential
arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing).
"Liquidation Preference" means an amount in Cash equal to $50,000 for
each share of Series A Preferred Shares or Series B Preferred Shares, as
the case may be, plus an amount in Cash equal to all accrued but unpaid
dividends on such applicable share to the Initial Closing Date. Such amount
as of September 29, 1997 equals (i) $79,562.84 with respect to each share
of Series A Preferred Shares and (ii) $69,378.23 with respect to each share
of Series B Preferred Shares, which in each case shall be appropriately
adjusted in the event that the Initial Closing Date occurs on a date other
than September 29, 1997.
"Person" means an individual, partnership, limited liability company,
corporation, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority or other entity of
whatever nature.
"Series A Certificate of Designation" means the Amended and Restated
Certificate of Designation, which designated the Series A Preferred Stock,
in the form in which it was filed with Secretary of State of Delaware on
December 28, 1993 as part of NWA Corp.'s Second Amended and Restated
Certificate of Incorporation.
"Series B Certificate of Designation" means the Amended and Restated
Certificate of Designation, which designated the Series B Preferred Stock,
in the form in which it was filed with Secretary of State of Delaware on
December 28, 1993 as part of NWA Corp.'s Second Amended and Restated
Certificate of Incorporation.
"Stockholders' Agreement" means the Second Amended and Restated
Investor Stockholders' Agreement dated as of December 23, 1993, as amended,
supplemented or otherwise modified from time to time, among NWA Corp., KLM,
Blum, BTNY and certain other stockholders of NWA Corp. parties thereto, as
in effect on the date hereof.
ARTICLE II
DELIVERY AND PURCHASE OF SHARES
2.1 Purchase and Sale of Shares. On the terms and subject to the
conditions of this Agreement, on the Initial Closing Date, (i) BTNY agrees to
transfer, assign and deliver to NWA Corp., against payment by NWA Corp. to BTNY
of immediately available funds by wire transfer to an account designated by BTNY
in an amount equal to 99% of the aggregate Liquidation Preference for the Series
A Preferred Shares (the "Series A Purchase Price"), a
-3-
<PAGE>
certificate or certificates representing the Series A Preferred Shares, and NWA
Corp. agrees to purchase such shares and make such payment to BTNY against
delivery of such certificates on such Initial Closing Date, and (ii) BTNY agrees
to transfer, assign and deliver to NWA Corp., against payment by NWA Corp. to
BTNY of immediately available funds in an amount equal to 99% of the aggregate
Liquidation Preference for the Series B Preferred Shares (the "Series B Purchase
Price"), a certificate or certificates representing the Series B Preferred
Shares, and NWA Corp. agrees to purchase such shares and make such payment to
BTNY against delivery of such certificates on such Initial Closing Date. Such
certificates shall be duly endorsed in blank or accompanied by stock powers duly
executed in blank, with all necessary stock transfer stamps affixed.
2.2 Closing of Purchase and Sale of Shares. The closing of the purchase
and sale contemplated by Section 2.1 will occur at the time and place of the
Initial Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of BTNY. BTNY represents and
warrants to NWA Corp. as of the date hereof and as of the Initial Closing Date
as follows:
(a) BTNY is a corporation duly organized, validly existing and in good
standing under the laws of the State of New York.
(b) BTNY has all requisite corporate power and authority to execute and
deliver this Agreement and to perform its obligations hereunder. The
execution and delivery by BTNY of this Agreement and the performance of the
transactions herein contemplated to be performed by BTNY have been duly
authorized by all necessary corporate action. This Agreement has been duly
executed and delivered by BTNY and, assuming due authorization, execution
and delivery by NWA Corp., constitutes the legal, valid and binding
agreement of BTNY, enforceable against BTNY in accordance with its terms,
except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether
considered in a proceeding at law or in equity).
(c) Neither the execution and delivery of this Agreement or the
performance by BTNY of the transactions contemplated hereby will (i)
violate or conflict with any of the provisions of the charter or other
organizational documents of BTNY, (ii) with or without the giving of notice
or the lapse of time or both, violate or constitute a default under, or
result in the acceleration of or entitle any party to accelerate (whether
after the giving of notice or lapse of time or both) any obligation under
any mortgage, indenture, deed of trust, lease, contract, agreement, license
or other instrument or any
-4-
<PAGE>
provision of any law, order, judgment, decree, restriction or ruling of any
governmental authority to which BTNY is a party or by which any of its
property is bound or (iii) result in the creation of any Liens upon any of
the shares of Series A Preferred Stock or Series B Preferred Stock to be
acquired by it upon exercise of the KLM Option pursuant to the Amendment to
the Stockholders' Agreement.
(d) No consent, approval, authorization or order of, or filing or
registration with, any court or governmental agency or body or any other
Person is required for the execution, delivery and performance by BTNY of
this Agreement and the consummation of the transactions contemplated
hereby.
(e) There are no lawsuits, actions, arbitrations or legal or
administrative or regulatory proceedings, charges, complaints or
investigations pending or, to the best knowledge of BTNY, threatened
against BTNY, and BTNY is not a party to, or subject to or bound by, any
order, judgment, injunction, stipulation, award or decree (whether rendered
by a court or administrative agency or by arbitration), in any such case,
which could, individually or in the aggregate, materially adversely affect
the ability of BTNY to consummate the transactions contemplated hereby.
(f) On the Initial Closing Date BTNY will have, good and valid title to
the Preferred Shares to be purchased by NWA Corp. at the Initial Closing
Date, free and clear of all Liens.
(g) BTNY is the record and beneficial owner on the date hereof of 999
shares of Class A Common Stock and 2,635,020 shares of Class B Common
Stock, and upon exercise of the KLM Option pursuant to the Amendment to the
Stockholders' Agreement and the registration in the name of BTNY of the
shares being acquired by BTNY upon exercise of the KLM Option, BTNY will be
the record and beneficial owner (subject to this Agreement) of (i) 999
shares of Class A Common Stock, (ii) 654.4002 shares of Series A Preferred
Stock and (iii) 218.1001 shares of Series B Preferred Stock.
(h) Neither BTNY nor any of its officers, directors, employees or
agents has authorized any Person to act as a broker, finder or in any
similar capacity on behalf of BTNY in connection with the transactions
contemplated by this Agreement.
3.2 Representations and Warranties of NWA Corp. NWA Corp. represents
and warrants to BTNY as of the date hereof and as of the Initial Closing Date as
follows:
(a) NWA Corp. is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware.
(b) NWA Corp. has all requisite corporate power and authority to
execute and deliver this Agreement and to perform its obligations
hereunder. The execution and
-5-
<PAGE>
delivery by NWA Corp. of this Agreement and the performance of the
transactions herein contemplated to be performed by NWA Corp. have been
duly authorized by the Board of Directors and no further corporate action
on the part of NWA Corp. is necessary to authorize this Agreement and the
performance of such transactions. This Agreement has been duly executed and
delivered by NWA Corp. and, assuming due authorization, execution and
delivery by BTNY, constitutes the legal, valid and binding agreement of NWA
Corp., enforceable against NWA Corp. in accordance with its terms, except
as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether
considered in a proceeding at law or in equity).
(c) Neither the execution and delivery of this Agreement or the
performance by NWA Corp. of the transactions contemplated hereby will (i)
violate or conflict with any of the provisions of the charter or other
organizational documents of NWA Corp. or (ii) with or without the giving of
notice or the lapse of time or both, violate or constitute a default under,
or result in the acceleration of or entitle any party to accelerate
(whether after the giving of notice or lapse of time or both) any
obligation under any mortgage, indenture, deed of trust, lease, contract,
agreement, license or other instrument or any provision of any law, order,
judgment, decree, restriction or ruling of any governmental authority to
which NWA Corp. is a party or by which any of its property is bound.
(d) No consent, approval, authorization or order of, or filing or
registration with, any court or governmental agency or body or any other
Person is required for the execution, delivery and performance by NWA Corp.
of this Agreement and the consummation of the transactions contemplated
hereby.
(e) There are no lawsuits, actions, arbitrations or legal or
administrative or regulatory proceedings, charges, complaints or
investigations pending or, to the best knowledge of NWA Corp., threatened
against NWA Corp., and NWA Corp. is not a party to, or subject to or bound
by, any order, judgment, injunction, stipulation, award or decree (whether
rendered by a court or administrative agency or by arbitration), in any
such case, which could, individually or in the aggregate, materially
adversely affect the ability of NWA Corp. to consummate the transactions
contemplated hereby.
(f) Neither NWA Corp. nor any of its officers, directors, employees or
agents has authorized any Person to act as a broker, finder or in any
similar capacity on behalf of NWA Corp. in connection with the transactions
contemplated by this Agreement.
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ARTICLE IV
ACKNOWLEDGMENTS
4.1 Acknowledgments. (a) BTNY hereby acknowledges that KLM, pursuant to
the Share Exchange Agreement, dated as of June 28, 1996 (the "Exchange
Agreement"), between KLM and NWA Corp., has unconditionally and irrevocably
agreed that NWA Corp. may, notwithstanding any provision to the contrary in the
Series A Certificate of Designation or the Series B Certificate of Designation,
as the case may be, or otherwise, declare, pay or set apart for payment any
dividend on any of the Junior Securities or Parity Securities or make any
payment on account of, or set apart for payment money for a sinking or other
similar fund for, the repurchase, redemption or other retirement of, any of the
Junior Securities or Parity Securities or any warrants, rights, options or other
securities exercisable for or convertible into any of the Junior Securities or
Parity Securities, or make any distribution in respect of Junior Securities or
Parity Securities, either directly or indirectly, and whether in cash,
obligations or shares of NWA Corp. or other property, and may permit NWA Corp.
or any corporation or other entity directly or indirectly controlled by NWA
Corp. to purchase or redeem any of the Junior Securities or Parity Securities or
any warrants, rights, options or other securities exercisable for or convertible
into any of the Junior Securities or Parity Securities. For purposes of this
Section 4.1(a), the terms "Junior Securities" and "Parity Securities" have the
meanings assigned to such terms in each of the Series A Certificate of
Designation and the Series B Certificate of Designation.
(b) BTNY further acknowledges that the agreements and waivers contained
in Sections 6.1(a), (b) and (c) of the Share Exchange Agreement including the
agreement specified in Section 4.1(a) of this Agreement are applicable to and
binding upon BTNY and all subsequent holders of the shares of Series A Preferred
Stock and Series B Preferred Stock that BTNY receives from KLM upon the exercise
of the KLM Option pursuant to the Amendment to the Stockholders' Agreement.
ARTICLE V
CONDITIONS PRECEDENT
5.1 Conditions to Closing. (a) The obligations of NWA Corp. to purchase
the Preferred Shares at the Initial Closing Date shall be subject to the
satisfaction (or waiver by NWA Corp.) of the following conditions:
(i) Representations and Warranties and Performance. The
representations and warranties of BTNY contained herein shall have been
true and correct in all material respects when made and in addition shall
be true and correct in all material respects at and as of the Initial
Closing Date with the same effect as though made at and as of the Initial
Closing Date. BTNY shall have performed in all material respects all
obligations and shall have complied in all material respects with all
covenants and other
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agreements required by this Agreement to be performed or complied with by
BTNY at or prior to the Initial Closing Date.
(ii) Officer's Certificate. NWA Corp. shall have received an
executed certificate, dated the Initial Closing Date, of a Senior Vice
President of BTNY to the effect set forth in Section 5.1(a)(i) hereto.
(iii) No Injunctions, etc. No injunction or temporary restraining
order shall have been issued and remain in force which restrains, prohibits
or invalidates the transactions contemplated by this Agreement.
(iv) Consent of Series B Preferred. The holders of all outstanding
shares of Series B Preferred Stock shall have provided their irrevocable
consent to the transactions contemplated by this Agreement, the Common
Stock Agreement, the Preferred Stock Repurchase Agreement, dated as of
September 29, 1997 (the "Preferred Stock Agreement"), between KLM and NWA
Corp., and the Blum Preferred Stock Repurchase Agreement, dated as of
September 29, 1997 (the "Blum Preferred Stock Agreement"), between Blum and
NWA Corp.
(v) Common Stock Purchase. The "Initial Closing Date" under and as
defined in the Common Stock Agreement shall occur concurrently with the
closing of the transactions contemplated hereby.
(b) The obligations of BTNY to sell the Preferred Shares at the Initial
Closing Date shall be subject to the satisfaction (or waiver by BTNY) of the
following conditions:
(i) Representations and Warranties and Performance. The
representations and warranties of NWA Corp. contained herein shall have
been true and correct in all material respects when made and in addition
shall be true and correct in all material respects at and as of the Initial
Closing Date with the same effect as though made at and as of the Initial
Closing Date. NWA Corp. shall have performed in all material respects all
obligations and shall have complied in all material respects with all
covenants and other agreements required by this Agreement to be performed
or complied with by NWA Corp. at or prior to the Initial Closing Date.
(ii) Officer's Certificate. BTNY shall have received an executed
certificate, dated the Initial Closing Date, of the President of NWA Corp.
to the effect set forth in Section 5.1(b)(i) hereto.
(iii) No Injunctions, etc. No injunction or temporary restraining
order shall have been issued and remain in force which restrains, prohibits
or invalidates the transactions contemplated by this Agreement.
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(iv) Consent of Series B Preferred. The holders of all outstanding
shares of Series B Preferred Stock shall have provided their irrevocable
consent to the transactions contemplated by this Agreement, the Common
Stock Agreement, the Preferred Stock Agreement and the BTNY Preferred Stock
Agreement.
(v) Common Stock Purchase. The "Initial Closing Date" under and as
defined in the Common Stock Agreement shall occur concurrently with the
closing of the transactions contemplated hereby.
ARTICLE VI
GENERAL PROVISIONS
6.1 Termination or Abandonment of Agreement. (a) This Agreement may be
terminated or abandoned at any time prior to the Initial Closing Date by mutual
consent of the parties in writing.
(b) Except for the provisions in this Article VI, in the event of any
termination of the Agreement as provided in this Section 6.1, this Agreement
shall forthwith become wholly void and of no further force and effect and there
shall be no liability on the part of NWA Corp., BTNY or their respective
directors, officers or stockholders with respect to any obligations set forth in
this Agreement; provided, however, that nothing in this Section 6.1 shall
relieve any party from liability for any breach of its representations,
warranties, covenants or agreements contained in this Agreement.
6.2 Expenses. All fees, commissions and other expenses incurred by any
party hereto in connection with the negotiation of this Agreement and the other
transactions contemplated hereby, including any fees and expenses of their
respective counsel and financial advisors, shall be borne by the party incurring
such fee or expense.
6.3 Execution in Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement,
and shall become a binding agreement when one or more counterparts have been
signed by each party and delivered to the other parties.
6.4 Notices. All notices, request, demands or other communications
provided herein shall be made in writing and shall be deemed to have been duly
given if delivered as follows:
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If to NWA Corp.:
2700 Lone Oak Parkway
Eagan, Minnesota 55121
Attention: Senior Vice President, General Counsel
and Secretary
Fax: (612) 726-7123
with a copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3954
Attention: Robert L. Friedman, Esq.
Fax: (212) 455-2502
If to BTNY:
130 Liberty Street
New York, New York 10006
Attention: Joseph T. Wood
Fax: (212) 250-7651
with a copy to:
Bankers Trust Company
130 Liberty Street
New York, New York 10006
Attention: General Counsel
or to such other address as either party shall have specified by notice in
writing to the other party. All such notices, requests, demands and
communications shall be deemed to have been received on (i) the date of delivery
if sent by messenger, (ii) on the Business Day following the Business Day on
which delivered to a recognized courier service if sent by overnight courier,
(iii) on the date received, if sent by fax or (iv) on the fifth Business Day
after the mailing thereof if sent by mail.
6.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AS APPLIED TO CONTRACTS
ENTERED INTO AND TO BE PERFORMED IN NEW YORK AND WITHOUT REGARD TO THE
APPLICATION OF PRINCIPLES OF CONFLICT OF LAWS.
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6.6 Titles and Headings. Titles and headings to Articles and Sections
herein are inserted for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this Agreement.
6.7 Successors and Assigns. This Agreement shall not be assignable by
BTNY without the prior written consent of NWA Corp. or by NWA Corp. without the
prior written consent of BTNY; provided, however, that NWA Corp. may assign all
or any part of its interest in this Agreement to any of its Affiliates if such
Affiliate undertakes in writing to perform NWA Corp.'s obligations hereunder;
and provided, further, that no such assignment shall relieve NWA Corp. of its
obligations hereunder and NWA Corp. shall unconditionally guarantee the
performance by such assignee of the obligations of NWA Corp. hereunder pursuant
to a written instrument satisfactory to BTNY. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors in interest and assigns.
6.8 Entire Agreement; No Oral Waiver. This Agreement and the
certificates and other documents contemplated hereby and thereby constitute the
entire agreement among the parties pertaining to the subject matter hereof and
supersede all prior and contemporaneous agreements, understandings and
representations, whether oral or written, of the parties in connection
therewith. No covenant or condition or representation not expressed in this
Agreement shall affect or be effective to interpret, change or restrict this
Agreement. No prior drafts of this Agreement and no words or phrases from any
such prior drafts shall be admissible into evidence in any action, suit or other
proceeding involving this Agreement or the transactions contemplated hereby.
This Agreement may not be changed or terminated orally, nor shall any change,
termination or attempted waiver of any of the provisions of this Agreement be
binding on any party unless in writing signed by the parties hereto. No
modification, waiver, termination, rescission, discharge or cancellation of this
Agreement and no waiver of any provision of or default under this Agreement
shall affect the right of any party thereafter to enforce any other provision or
to exercise any right or remedy in the event of any other default, whether or
not similar.
6.9 Severability. If any provision of this Agreement shall be declared
by any court of competent jurisdiction to be illegal, void or unenforceable, all
other provisions of this Agreement shall not be affected and shall remain in
full force and effect.
6.10 No Third-Party Rights. Nothing in this Agreement, expressed or
implied, shall or is intended to confer upon any Person other than the parties
hereto or their respective successors or assigns, any rights or remedies of any
nature or kind whatsoever under or by reason of this Agreement.
6.11 Submission To Jurisdiction. Each of the parties hereto hereby
irrevocably unconditionally:
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(a) submits for itself and its property in any legal action or
proceeding relating to or arising from this Agreement, or for recognition
and enforcement of any judgment in respect thereof, to the non-exclusive
general jurisdiction of the courts of the United States of America sitting
in the Southern District of New York;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to its address
set forth in Section 6.4; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to
sue in any other appropriate jurisdiction.
6.12 Remedies. Each of the parties hereto acknowledges that the rights
granted to NWA Corp. in this Agreement are of a special, unique and
extraordinary character, and that any breach of this Agreement by BTNY could not
be compensated for by damages. Accordingly, in the event of any failure or
refusal by BTNY to comply with any covenant or agreement contained in this
Agreement NWA Corp. shall be entitled, in addition to any other remedies that
NWA Corp. may have, to enforcement of this Agreement by a decree of specific
performance requiring BTNY to fulfill its obligations under this Agreement.
6.13 Brokers and Finders. Each party shall bear all costs and expenses,
and shall indemnify the other party for all costs and expenses, relating to the
retention by such party of any finder or broker in connection with the
transactions contemplated by this Agreement.
6.14 Further Assurances. From time to time, at the reasonable request
of the other party hereto and without further consideration, each party hereto
shall execute and deliver such additional documents and take all such further
action as may be necessary or desirable to consummate and make effective, in the
most expeditious manner practicable, the transactions contemplated by this
Agreement.
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IN WITNESS WHEREOF, the parties have executed, delivered and entered
into this Agreement as of the day and year first above written.
NORTHWEST AIRLINES CORPORATION
By:
Name:
Title:
By:
Name:
Title:
BANKERS TRUST NEW YORK
CORPORATION
By:
Name:
Title:
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