EXHIBIT 4.2
THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT, FOR
PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE UNITED STATES INTERNAL REVENUE
CODE OF 1986, AS AMENDED. THE ISSUE PRICE OF THIS NOTE WAS $343.61 PER $1,000 OF
PRINCIPAL AMOUNT AT MATURITY; THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, INCLUDING
CASH INTEREST PAYABLE THROUGH JULY 30, 2008 TAXABLE AS ORIGINAL ISSUE DISCOUNT
UNDER TREASURY REGULATION SECTION 1.1273-1, IS $780.95 PER $1,000 OF PRINCIPAL
AMOUNT AT MATURITY; THE ISSUE DATE IS JULY 30, 2003; AND THE YIELD TO MATURITY
FOR THE PURPOSES OF ACCRUING TAX ORIGINAL ISSUE DISCOUNT IS 7.25% PER ANNUM,
CALCULATED ON A SEMIANNUAL BOND EQUIVALENT BASIS.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST
COMPANY, OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.
THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXCHANGE OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
THIS SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON EXCHANGE OF THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES
TO OFFER, SELL, OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF
THE LAST DAY SECURITIES OF THIS ISSUE WERE ISSUED AND THE LAST DATE ON WHICH
AMERICA WEST AIRLINES, INC. (THE "COMPANY" OR THE "ISSUER") OR ANY AFFILIATE OF
THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY)
ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO
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RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO
AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(a)(1), (2),(3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (C) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF ANY HOLDER THAT IS NOT
AN AFFILIATE OF THE COMPANY AFTER THE RESALE RESTRICTION TERMINATION DATE.
THE FOREGOING LEGEND MAY BE REMOVED FROM THIS SECURITY ON
SATISFACTION OF THE CONDITIONS SPECIFIED IN THE INDENTURE.
2
AMERICA WEST AIRLINES, INC.
Senior Exchangeable Note due 2023
No. A-1 CUSIP: 023650AL8
Issue Date: July 30, 2003 Original Issue Discount: $780.95
Issue Price: $343.61 (for each $1,000 Principal
(for each $1,000 Principal Amount at Maturity)
Amount at Maturity)
AMERICA WEST AIRLINES, INC., a Delaware corporation, promises
to pay to Cede & Co. or registered assigns the Principal Amount at Maturity of
_______________________________ ($__________________) on July 30, 2023.
This Security shall not bear interest except as specified on
the other side of this Security. Original Issue Discount will accrue as
specified on the other side of this Security. This Security is exchangeable as
specified on the other side of this Security.
3
Additional provisions of this Security are set forth on the
other side of this Security.
Dated: July 30, 2003 AMERICA WEST AIRLINES, INC.
By:__________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
U.S. BANK NATIONAL ASSOCIATION,
as Trustee, certifies that this
is one of the Securities referred
to in the within-mentioned Indenture.
By:________________________
Authorized Officer
Dated: ____________________
4
FORM OF REVERSE SIDE OF NOTE
Senior Exchangeable Note due 2023
(1) Interest.
The Company promises to pay interest in cash on the Principal
Amount at Maturity of this Note at the rate per annum of 2.4912% from the Issue
Date, or from the most recent date to which interest has been paid or provided
for, until July 30, 2008. During such period, the Company will pay cash interest
semiannually in arrears on January 30 and July 30 of each year (each an
"INTEREST PAYMENT DATE") to Holders of record at the close of business on each
January 15 and July 15 (whether or not a business day) (each a "REGULAR RECORD
DATE") immediately preceding such Interest Payment Date. Cash interest on the
Notes will accrue from the most recent date to which interest has been paid or
duly provided or, if no interest has been paid, from the Issue Date. Cash
interest will be computed on the basis of a 360-day year of twelve 30-day
months.
After July 30, 2008, this Security shall not bear interest,
except as specified in this paragraph or in paragraphs 5 and 11 hereof. If the
Principal Amount at Maturity hereof or any portion of such Principal Amount at
Maturity is not paid when due (whether upon acceleration pursuant to Section
6.02 of the Indenture, upon the date set for payment of the Redemption Price
pursuant to paragraph 5 hereof, upon the date set for payment of the Purchase
Price or Change of Control Purchase Price pursuant to paragraph 6 hereof or upon
the Stated Maturity of this Security) or if interest (including contingent
interest, if any) due hereon or any portion of such interest is not paid when
due in accordance with paragraph 5 or 11 hereof, then in each such case the
overdue amount shall, to the extent permitted by law, bear interest at the rate
of 7.25% per annum, compounded semiannually, which interest shall accrue from
the date such overdue amount was originally due to the date payment of such
amount, including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in lieu of, and not in addition to, the continued accrual of
Original Issue Discount.
Original Issue Discount (the difference between the Issue
Price and the Principal Amount at Maturity of the Security), in the period
during which a Security remains outstanding, shall accrue at 7.25% per annum, on
a semiannual bond equivalent basis using a 360-day year composed of twelve
30-day months, from the Issue Date of this Security.
(2) Method of Payment.
Subject to the terms and conditions of the Indenture, the
Company will make payments in respect of Redemption Prices, Purchase Prices,
Change of Control Purchase Prices and at Stated Maturity to Holders who
surrender Securities to a Paying Agent to collect such payments in respect of
the Securities. The Company will pay any cash amounts in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may make such cash payments by check payable
in such money.
(3) Paying Agent, Exchange Agent, Registrar and
Bid Solicitation Agent.
Initially, U.S. Bank National Association, a national banking
association (the "TRUSTEE"), will act as Paying Agent, Exchange Agent, Registrar
and Bid Solicitation Agent.
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The Company may appoint and change any Paying Agent, Exchange Agent, Registrar
or co-registrar or Bid Solicitation Agent without notice, other than notice to
the Trustee except that the Company will maintain at least one Paying Agent in
the State of New York, City of New York, Borough of Manhattan, which shall
initially be an office or agency of the Trustee. The Company or any of its
Subsidiaries or any of their Affiliates may act as Paying Agent, Exchange Agent,
Registrar or co-registrar. None of the Company, any of its Subsidiaries or any
of their Affiliates shall act as Bid Solicitation Agent.
(4) Indenture.
The Company issued the Securities pursuant to an Indenture
dated as of July 30, 2003 (the "INDENTURE"), between the Company and the Trustee
and America West Holdings Corporation ("HOLDINGS") has guaranteed the Securities
pursuant to a Guaranty and Exchange Agreement dated as of July 30, 2003 (the
"EXCHANGE AGREEMENT") by and between Holdings and U.S. Bank National
Association, as Exchange Agent and Trustee. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939, as in effect from time to time (the "TIA").
Capitalized terms used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the TIA for a statement of
those terms.
The Securities and the Guarantees are general unsecured and
unsubordinated obligations, of the Company and the Guarantors, respectively,
limited to $261,925,000 aggregate Principal Amount at Maturity (subject to
Section 2.07 of the Indenture). The Indenture does not limit other indebtedness
of the Company, secured or unsecured.
(5) Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities
are redeemable as a whole, or from time to time in part, at any time at the
option of the Company in accordance with the Indenture at the Redemption Prices
set forth below, provided that the Securities are not redeemable prior to July
30, 2008.
The table below shows Redemption Prices of a Security per
$1,000 Principal Amount at Maturity on the dates shown below and at Stated
Maturity, which prices reflect accrued Original Issue Discount calculated to
each such date. The Redemption Price of a Security redeemed between such dates
shall include an additional amount reflecting the additional Original Issue
Discount accrued since the preceding date in the table but not including the
Redemption Date.
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(2) (3)
(1) ACCRUED REDEMPTION
NOTE ORIGINAL ISSUE PRICE
REDEMPTION DATE ISSUE PRICE DISCOUNT (1) + (2)
- --------------- ----------- -------------- ----------
$ $ $
July 30,
2008....................... 343.61 0.00 343.61
2009....................... 343.61 25.36 368.97
2010....................... 343.61 52.60 396.21
2011....................... 343.61 81.84 425.45
2012....................... 343.61 113.25 456.86
2013....................... 343.61 146.97 490.58
2014....................... 343.61 183.18 526.79
2015....................... 343.61 222.07 565.68
2016....................... 343.61 263.82 607.43
2017....................... 343.61 308.66 652.27
2018....................... 343.61 356.80 700.41
2019....................... 343.61 408.50 752.11
2020....................... 343.61 464.02 807.63
2021....................... 343.61 523.64 867.25
2022....................... 343.61 587.65 931.26
At stated maturity......... 343.61 656.39 1,000.00
If this Security has been converted to a semiannual coupon
note following the occurrence of a Tax Event, the Redemption Price will be equal
to the Restated Principal Amount plus accrued and unpaid interest from the date
of such conversion to but not including the Redemption Date; but in no event
will this Security be redeemable before July 30, 2008.
(6) Purchase by the Company at the Option of the
Holder.
Subject to the terms and conditions of the Indenture, the
Company shall become obligated to purchase, at the option of the Holder, the
Securities held by such Holder on the following Purchase Dates and at the
following Purchase Prices per $1,000 Principal Amount at Maturity, upon delivery
of a Purchase Notice containing the information set forth in the Indenture, at
any time from the opening of business on the date that is 20 Business Days prior
to such Purchase Date until the close of business on the second Business Day
immediately preceding such Purchase Date and upon delivery of the Securities to
the Paying Agent by the Holder as set forth in the Indenture.
Purchase Date Purchase Price
- ------------- --------------
July 30, 2008 $343.61
July 30, 2013 $490.58
July 30, 2018 $700.41
The Purchase Price (equal to the Issue Price plus accrued
Original Issue Discount to the Purchase Date) may be paid, at the option of the
Company, in cash or by the
7
issuance and delivery of shares of Common Stock of Holdings, or in any
combination thereof in accordance with the Indenture.
If prior to a Purchase Date this Security has been converted
to a semiannual coupon note following the occurrence of a Tax Event, the
Purchase Price will be equal to the Restated Principal Amount plus accrued and
unpaid interest from the date of conversion to the Purchase Date as provided in
the Indenture.
At the option of the Holder and subject to the terms and
conditions of the Indenture, the Company shall become obligated to purchase the
Securities held by such Holder no later than 30 Business Days after the
occurrence of a Change of Control of the Company for a Change of Control
Purchase Price equal to the Issue Price plus accrued Original Issue Discount to
but not including the Change of Control Purchase Date. If prior to a Change of
Control Purchase Date this Security has been converted to a semiannual coupon
note following the occurrence of a Tax Event, the Change of Control Purchase
Price shall be equal to the Restated Principal Amount plus accrued and unpaid
interest from the date of conversion to the Change of Control Purchase Date.
In accordance with the terms of the Exchange Agreement,
Holdings may, at its option, elect to delivery Common Stock (as defined in the
Exchange Agreement) to satisfy all or a portion of the Change of Control
Purchase Price.
A third party may make the offer and purchase of the
Securities in lieu of the Company in accordance with the Indenture and the
Exchange Agreement.
Holders have the right to withdraw any Purchase Notice or
Change of Control Purchase Notice, as the case may be, by delivering to the
Paying Agent a written notice of withdrawal in accordance with the provisions of
the Indenture.
If cash (and/or securities if permitted under the Indenture
and the Exchange Agreement) sufficient to pay the Purchase Price or Change of
Control Purchase Price, as the case may be, of all Securities or portions
thereof to be purchased as of the Purchase Date or the Change of Control
Purchase Date, as the case may be, is deposited with the Paying Agent or
Exchange Agent on the Business Day following the Purchase Date or the Change of
Control Purchase Date, as the case may be, Original Issue Discount and
contingent interest, if any, shall cease to accrue on such Securities (or
portions thereof) on such Purchase Date or Change of Control Purchase Date, as
the case may be, and the Holder thereof shall have no other rights as such
(other than the right to receive the Purchase Price or Change of Control
Purchase Price, as the case may be, if any, upon surrender of such Security).
(7) Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date to each Holder of Securities to be
redeemed at the Holder's registered address. If money sufficient to pay the
Redemption Price of, and accrued and unpaid contingent interest, if any, with
respect to, all Securities (or portions thereof) to be redeemed on the
Redemption Date is deposited with the Paying Agent prior to or on the Redemption
Date, on such Redemption Date, Original Issue Discount and interest (including
contingent interest), if any, shall cease to accrue on such Securities or
portions thereof. Securities in denominations larger than $1,000 of Principal
Amount at Maturity may be redeemed in part but only in integral multiples of
$1,000 of Principal Amount at Maturity.
8
(8) Exchange.
Exchange Based on Common Stock Price. Subject to the
provisions of this paragraph 8, the Indenture and the Exchange Agreement and
notwithstanding the fact that any other condition to exchange has not been
satisfied, Holders may exchange the Securities into Common Stock on an Exchange
Date in any fiscal quarter commencing after September 30, 2003, if, as of the
last day of the preceding fiscal quarter, the Sale Price of the Common Stock for
at least 20 trading days in a period of 30 consecutive trading days ending on
the last trading day of such preceding fiscal quarter is greater than the
exchange trigger price per share. A Security (or portion thereof) surrendered
for exchange based upon the Sale Price of the Common Stock, as described in the
Exchange Agreement may be surrendered for exchange until the close of business
on July 23, 2023.
The "accreted exchange price per share" of Common Stock as of
any day equals the quotient of:
- - the Issue Price and accrued Original Issue Discount to that day,
divided by
- - the number of shares of Common Stock issuable upon exchange of $1,000
Principal Amount at Maturity of Securities on that day.
The "exchange trigger price" per share of Common Stock in
respect of each of the first twenty fiscal quarters following issuance of the
Securities is $11.80. This exchange trigger price reflects the accreted exchange
price per share of Common Stock multiplied by 110%. Thereafter, the accreted
exchange price per share of Common Stock increases each fiscal quarter by the
accreted original issue discount for the quarter. The exchange trigger price per
share for the fiscal quarter beginning July 1, 2023 is $34.13. The foregoing
exchange trigger prices assume that no events have occurred that would require
an adjustment to the exchange rate.
Exchange Based on Trading Price of the Securities. Subject to
the provisions of this paragraph 8, the Indenture and the Exchange Agreement and
notwithstanding the fact that any other condition to exchange has not been
satisfied, on or before July 30, 2018, the Securities may be surrendered for
exchange at any time after a 10 consecutive trading-day period in which the
average of the trading prices for the Securities for that 10 trading-day period
was less than 103% of the average exchange value for the Securities during that
period.
The exchange value of a Security is equal to the product of
the closing sale price for shares of our common stock on a given day multiplied
by the then current exchange rate, which is the number of shares of Common Stock
into which each Security is then exchangeable. The trading price of the
Securities on any date of determination is the average of the secondary market
bid quotations per Security obtained by the Company or the calculation agent for
$2,500,000 principal amount of notes at approximately 3:30 p.m., New York City
time, on such determination date from two independent nationally recognized
securities dealers the Company selects, provided that if at least two such bids
cannot reasonably be obtained by the Company or the calculation agent, but one
such bid is obtained, then this one bid shall be used.
Exchange upon Redemption. Subject to the provisions of this
paragraph 8, the Indenture and the Exchange Agreement and notwithstanding the
fact that any other condition to exchange has not been satisfied, a Holder may
exchange into Common Stock a Security or
9
portion of a Security which has been called for redemption pursuant to paragraph
5 hereof, but such Securities may be surrendered for exchange until the close of
business on the second Business Day immediately preceding the Redemption Date.
Exchange upon Certain Distributions. Subject to the provisions
of this paragraph 8, the Indenture and the Exchange Agreement and
notwithstanding the fact that any other condition to exchange has not been
satisfied, in the event that the Company declares a dividend or distribution
described in Section 7.07 of the Exchange Agreement, or a dividend or a
distribution described in Section 7.08 of the Exchange Agreement where, the fair
market value, per share, of such dividend or distribution per share of Common
Stock, as determined in the Indenture, exceeds 5% of the Sale Price of the
Common Stock on the Business Day immediately preceding the date of declaration
for such dividend or distribution, the Securities may be surrendered for
exchange beginning on the date the Company gives notice to the Holders of such
right, which shall not be less than 20 days prior to the Ex-Dividend Time for
such dividend or distribution, and Securities may be surrendered for exchange at
any time thereafter until the close of business on the Business Day prior to the
Ex-Dividend Time or until the Company announces that such dividend or
distribution will not take place.
Exchange upon the Occurrence of Certain Corporate
Transactions. Subject to the provisions of this paragraph 8, the Indenture and
the Exchange Agreement and notwithstanding the fact that any other condition to
exchange has not been satisfied, in the event the Company is a party to a
consolidation, merger or binding share exchange pursuant to which the Common
Stock would be exchanged into cash, securities or other property as set forth in
Section 7.14 of the Exchange Agreement, the Securities may be surrendered for
exchange at any time from and after the date which is 15 days prior to the date
the Company announces the anticipated effective time until 15 days after the
actual effective date of such transaction, and at the effective time of such
transaction the right to exchange a Security into Common Stock will be deemed to
have changed into a right to exchange it into the kind and amount of cash,
securities or other property which the holder would have received if the holder
had exchanged its Security immediately prior to the transaction.
A Security in respect of which a Holder has delivered a
Purchase Notice or Change of Control Purchase Notice exercising the option of
such Holder to require the Company to purchase such Security may be exchanged
only if such notice of exercise is withdrawn in accordance with the terms of the
Indenture.
The initial Exchange Rate is 32.038 shares of Common Stock per
$1,000 Principal Amount at Maturity, subject to adjustment in certain events
described in the Indenture. The Company will deliver cash or a check in lieu of
any fractional share of Common Stock.
In the event the Company exercises its option pursuant to
Section 10.01 of the Indenture to have interest in lieu of Original Issue
Discount accrue on the Security following a Tax Event, the Holder will be
entitled on exchange to receive the same number of shares of Common Stock such
Holder would have received if the Company had not exercised such option.
Accrued and unpaid interest in lieu of Original Issue Discount
and cash interest will not be paid on Securities that are exchanged; provided,
however that Securities surrendered for exchange during the period, in the case
of interest in lieu of Original Issue
10
Discount, from the close of business on any Regular Record Date next preceding
any Interest Payment Date to the opening of business on such Interest Payment
Date, shall be entitled to receive such interest, in lieu of Original Issue
Discount, payable on such Securities on the corresponding Interest Payment Date
and (except Securities with respect to which the Company has mailed a notice of
redemption) Securities surrendered for exchange during such periods must be
accompanied by payment of an amount equal to the interest in lieu of Original
Issue Discount with respect thereto that the registered Holder is to receive.
To exchange a Security, a Holder must (1) complete and
manually sign the exchange notice below (or complete and manually sign a
facsimile of such notice) and deliver such notice to the Exchange Agent, (2)
surrender the Security to the Exchange Agent, (3) furnish appropriate
endorsements and transfer documents if required by the Exchange Agent, the
Company or the Trustee and (4) pay any transfer or similar tax, if required.
A Holder may exchange a portion of a Security if the Principal
Amount at Maturity of such portion is $1,000 or an integral multiple of $1,000.
No payment or adjustment will be made for dividends on the Common Stock except
as provided in the Exchange Agreement. On exchange of a Security, the greater of
that portion of accrued Original Issue Discount (or interest if the Company has
exercised its option provided for in paragraph 10 hereof) or Tax Original Issue
Discount attributable to the period from the Issue Date (or, if the Company has
exercised the option referred to in paragraph 10 hereof, the later of (x) the
date of such exercise and (y) the date on which interest was last paid) through
the Exchange Date and (except as provided above) accrued cash interest, if any,
with respect to the exchanged Security shall not be cancelled, extinguished or
forfeited, but rather shall be deemed to be paid in full to the Holder thereof
through the delivery of the Common Stock (together with the cash payment, if
any, in lieu of fractional shares) in exchange for the Security being exchanged
pursuant to the terms hereof; and the fair market value of such shares of Common
Stock (together with any such cash payment in lieu of fractional shares) shall
be treated as issued, to the extent thereof, first in exchange for the greater
of Original Issue Discount (or interest, if the Company has exercised its option
provided for in paragraph 10 hereof) or Tax Original Issue Discount accrued
through the Exchange Date and any accrued cash interest, and the balance, if
any, of such fair market value of such Common Stock (and any such cash payment)
shall be treated as issued in exchange for the Issue Price of the Security being
exchanged pursuant to the provisions hereof.
The Exchange Rate will be adjusted, in the manner provided in
the Exchange Agreement, for dividends or distributions on Common Stock payable
in Common Stock or other Capital Stock; subdivisions, combinations or certain
reclassifications of Common Stock; distributions to all holders of Common Stock
of certain rights to purchase Common Stock for a period expiring within 60 days
of the record date for such distribution at less than the Sale Price of the
Common Stock at the Time of Determination; and distributions to such holders of
assets or debt securities of Holdings or certain rights to purchase securities
of Holdings (excluding certain cash dividends or distributions) and certain
rights pursuant to shareholder rights plans. However, no adjustment need be made
if Securityholders may participate in the transaction or in certain other cases.
Holdings from time to time may voluntarily increase the Exchange Rate.
If Holdings is a party to a consolidation, merger or binding
share exchange or a transfer of all or substantially all of its assets, or upon
certain distributions described in the Indenture, the right to exchange a
Security into Common Stock may be changed into a right to exchange it into
securities, cash or other assets of Holdings or another person.
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(9) Exchange Arrangement on Call for Redemption.
Any Securities called for redemption, unless surrendered for
exchange before the close of business on the Redemption Date, may be deemed to
be purchased from the Holders of such Securities at an amount not less than the
Redemption Price, by one or more investment bankers or other purchasers who may
agree with the Company to purchase such Securities from the Holders, to exchange
them into Common Stock of Holdings and to make payment for such Securities to
the Trustee in trust for such Holders.
(10) Tax Event.
(a) From and after (i) the date of the occurrence of a Tax
Event (the "TAX EVENT DATE") and (ii) the date the Company exercises the option
provided for in this paragraph 10, whichever is later (the "OPTION EXERCISE
DATE"), at the option of the Company, interest in lieu of future Original Issue
Discount shall accrue at the rate of 7.25% per annum on a principal amount per
Security (the "RESTATED PRINCIPAL AMOUNT") equal to the Issue Price plus
Original Issue Discount accrued through the Option Exercise Date and shall be
payable semiannually on January 30 and July 30 of each year (each an "INTEREST
PAYMENT DATE") to holders of record at the close of business on January 15 or
July 15 (each a "REGULAR RECORD DATE") immediately preceding such Interest
Payment Date. Interest will be computed on the basis of a 360-day year comprised
of twelve 30-day months and will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the Option
Exercise Date.
(b) Interest on any Security that is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the person in whose name that Security is registered at the close of business
on the Regular Record Date for such interest at the office or agency of the
Company maintained for such purpose. Each installment of interest on any
Security shall be paid in same-day funds by transfer to an account maintained by
the payee located inside the United States.
(11) Defaulted Interest.
Except as otherwise specified with respect to the Securities,
any Defaulted Interest on any Security shall forthwith cease to be payable to
the registered Holder thereof on the relevant Regular Record Date or accrual
date, as the case may be, by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company as provided for in Section 12.02
of the Indenture.
(12) Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons,
in denominations of $1,000 of Principal Amount at Maturity and integral
multiples of $1,000. A Holder may transfer or exchange Securities in accordance
with the Indenture and the Exchange Agreement. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not transfer or exchange any Securities selected
for redemption (except, in the case of a Security to be redeemed in part, the
portion of the Security not to be redeemed) or any Securities in respect of
which a Purchase Notice or Change of Control Purchase Notice has been given and
not withdrawn (except, in the case of a Security to be purchased in part, the
portion of the Security not to be purchased) or any
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Securities for a period of 15 days before the mailing of a notice of redemption
of Securities to be redeemed.
(13) Persons Deemed Owners.
The registered Holder of this Security may be treated as the
owner of this Security for all purposes.
(14) Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company
upon written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
subject to applicable unclaimed property laws. After return to the Company,
Holders entitled to the money or securities must look to the Company for payment
as general creditors unless an applicable abandoned property law designates
another person.
(15) Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding and (ii) certain Defaults may be waived with
the written consent of the Holders of a majority in aggregate Principal Amount
at Maturity of the Securities at the time outstanding. Subject to certain
exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture or Section 7.14 of the Exchange
Agreement, to secure the Company's obligations under this Security or to add to
the Company's covenants for the benefit of the Securityholders or to surrender
any right or power conferred, to comply with any requirement of the SEC in
connection with the qualification of the Indenture under the TIA, or as
necessary in connection with the registration of the Securities under the
Securities Act or to make any change that does not adversely affect the rights
of any Holders.
(16) Defaults and Remedies.
Under the Indenture, Events of Default include (i) default in
the payment of any interest when the same becomes due and payable or of interest
which becomes due and payable upon exercise by the Company of its option
provided for in paragraph 10 hereof which default in either case continues for
30 days; (ii) default in payment of the Principal Amount at Maturity (including
Original Issue Discount and, if the Securities have been converted to semiannual
coupon notes following a Tax Event, the Restated Principal Amount), Issue Price
plus accrued Original Issue Discount or cash interest, Redemption Price,
Purchase Price or Change of Control Purchase Price, as the case may be, in
respect of the Securities when the same becomes due and payable at its Stated
Maturity, upon redemption, upon declaration, when due for purchase by the
Company or otherwise; (iii) failure by the Company or any Guarantor to comply
with other agreements in the Securities, the Indenture or the Exchange Agreement
(other than those referred to in (i) and (ii) above) and such failure continues
for 60 days after receipt by the Company or any Guarantor of a Notice of
Default; (iv) default under any Debt, whether such Debt now exists or is created
later, which default results in such Debt becoming or being declared due and
payable prior to
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the date on which it would otherwise have become due and payable, and the
principal amount of all Debt so accelerated, together with all Debt due and
payable but not paid prior to the end of any grace period, is $25,000,000 or
more, and such acceleration has not been rescinded or annulled within a period
of 30 days after receipt by the Company of a Notice of Default from the Trustee;
provided, however, that if any such default shall be cured, waived, rescinded or
annulled, then the Event of Default by reason thereof shall be deemed not to
have occurred; (v) any Guarantee ceases to be in full force and effect or is
declared null and void or any Guarantor denies that it has any further liability
under any Guarantee, or gives notice to such effect (other than by reason of the
termination of the Indenture or the release of any such Guarantee in accordance
with the Indenture) and such condition shall have continued for a period of 30
days after written notice of such failure requiring the Guarantor and the
Company to remedy the same shall have been given (x) to the Company by the
Trustee or (y) to the Company and the Trustee by the holders of 25% in aggregate
principal amount of the Securities then outstanding; and (vi) certain events of
bankruptcy or insolvency. A Default under (iii) or (iv) above is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
in aggregate Principal Amount at Maturity of the Securities at the time
outstanding notify the Company, the Guarantors and the Trustee, of the Default
and the Company or the Guarantor does not cure such Default (and such Default is
not waived) within the time specified in (iii) or (iv) above after receipt of
such notice. Any such notice must specify the Default, demand that it be
remedied and state that such notice is a "Notice of Default". If an Event of
Default occurs and is continuing, the Trustee, or the Holders of at least 25% in
aggregate Principal Amount at Maturity of the Securities at the time
outstanding, may declare all the Securities to be due and payable immediately.
Certain events of bankruptcy or insolvency are Events of Default which will
result in the Securities becoming due and payable immediately upon the
occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives indemnity or security
reasonably satisfactory to it. Subject to certain limitations, Holders of a
majority in aggregate Principal Amount at Maturity of the Securities at the time
outstanding may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of amounts specified in clause (i) or (ii) above)
if it determines that withholding notice is in their interests.
(17) Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were
not Trustee.
(18) No Recourse Against Others.
A director, officer, employee, agent, representative,
stockholder or equity holder, as such, of the Company shall not have any
liability for any obligations of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each Securityholder
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
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(19) Authentication.
This Security shall not be valid until an authorized signatory
of the Trustee manually signs the Trustee's Certificate of Authentication on the
other side of this Security.
(20) Guarantees
The Company's obligations under the Securities are guaranteed
on a senior unsecured basis, jointly and severally, by Holdings and each Person
that becomes a Guarantor pursuant to the Exchange Agreement and by each person
that becomes a Guarantor pursuant to the Indenture.
(21) Abbreviations.
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with right of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
(22) GOVERNING LAW.
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE,
THE GUARANTEES AND THIS SECURITY.
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The Company will furnish to any Securityholder upon written
request and without charge a copy of the Indenture which has in it the text of
this Security in larger type. Requests may be made to:
America West Airlines, Inc.
4000 East Sky Harbor Boulevard
Phoenix, Arizona 85304
Attention: Linda Mitchell, General Counsel
Facsimile: (480) 693-5155
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ASSIGNMENT FORM EXCHANGE NOTICE
To assign this Security, fill in the form below: To exchange this Security into Common
Stock of Holdings, check the box:
I or we assign and transfer this Security to
________________________________________________ [ ]
To exchange only part of this Security,
(Insert assignee's soc. sec. or tax ID no.) state the Principal Amount at Maturity to
be exchanged (which must be $1,000 or an
________________________________________________ integral multiple of $1,000):
________________________________________________ $________________________________
________________________________________________ If you want the stock certificate made out
(Print or type assignee's name, address and in another person's name, fill in the form
zip code) below:
and irrevocably appoint ____________________________________________
____________________________________________
_____________________ agent to transfer (Insert other person's soc. sec. or tax ID
this Security on the books of the Company. no.)
The agent may substitute another to act . ____________________________________________
for him
____________________________________________
____________________________________________
____________________________________________
(Print or type other person's name, address
and zip code)
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________________________________________________________________________________
Date: _____________________ Your
Signature:_____________________________________________
________________________________________________________________________________
(Sign exactly as your name appears on the other side of this Security)
18