EXHIBIT 10.50(b)
PASS THROUGH TRUST AGREEMENT
61
179212.3/NYL2
This PASS THROUGH TRUST AGREEMENT, dated as of September 25,
1997, among ATLANTIC COAST AIRLINES, a California corporation (the "Company"),
ATLANTIC COAST AIRLINES, INC., a Delaware corporation (the "Guarantor"), and THE
FIRST NATIONAL BANK OF MARYLAND, a national banking association, as Trustee, is
made with respect to the formation of Atlantic Coast Airlines 1997-1A Pass
Through Trust and the issuance of 7.20% Atlantic Coast Airlines 1997-1A Pass
Through Certificates representing fractional undivided interests in the Trust.
WITNESSETH:
WHEREAS, pursuant to each Indenture, (i) in the case of each
of the six Canadair Regional Jet Series 200-ER aircraft ("CRJs") which will be
leased to the Company pursuant to the related Lease (the "Leased CRJs"), the
related Owner Trustee proposes to issue on a nonrecourse basis four series of
Equipment Notes to finance the purchase of the Leased CRJs referred to in such
Indenture, (ii) in the case of each of four British Aerospace Jetstream J-41
aircraft ("J-41s") which will be leased to the Company pursuant to the related
Lease (the "Leased J-41s", together with the Leased CRJs, the "Leased
Aircraft"), the related Owner Trustee proposes to issue on a nonrecourse basis
three series of Equipment Notes to finance the purchase of the Leased J-41s
referred to in such Indenture and (iii) in the case of each of the four J-41s
which are owned by the Company (the "Owned Aircraft"), the Company proposes to
issue on a recourse basis three series of Equipment Notes, to finance such Owned
Aircraft;
WHEREAS, the Trustee, upon execution and delivery of this
Agreement, hereby declares the creation of this Trust (the "1997-1A Trust") for
the benefit of the Certificateholders, and the initial Certificateholders, as
the grantors of the 1997-1A Trust, by their respective acceptances of the
Certificates, join in the creation of this 1997-1A Trust with the Trustee;
WHEREAS, all Certificates to be issued by the Trust will
evidence fractional undivided interests in the Trust and will convey no rights,
benefits or interests in respect of any property other than the Trust Property;
WHEREAS, pursuant to the terms and conditions of this
Agreement and each of the Financing Agreements to be entered into by the Trustee
substantially concurrently with the execution and delivery of this Agreement,
the Trustee on behalf of the Trust shall purchase one or more issues of
Equipment Notes having the same interest rate as, and final maturity dates not
later than the final Regular Distribution Date of, the Certificates issued
hereunder and shall hold such Equipment Notes in trust for the benefit of the
Certificateholders;
WHEREAS, all of the conditions and requirements necessary to
make this Agreement, when duly executed and delivered, a valid, binding and
legal instrument, enforceable in accordance with its terms and for the purposes
herein expressed, have been done, performed and fulfilled, and the execution and
delivery of this Agreement in the form and with the terms hereof have been in
all respects duly authorized; and
WHEREAS, to facilitate the sale of Equipment Notes to, and the
purchase of Equipment Notes by, the Trustee on behalf of the 1997-1A Trust, (i)
the Company as the "issuer", as such term is defined in and solely for purposes
of the Securities Act of 1933, as amended, of the Certificates to be issued
pursuant hereto and as the "obligor", as such term is defined in and solely for
purposes of the Trust Indenture Act of 1939, as amended and (ii) the Guarantor
have each duly authorized the execution and delivery of this Agreement with
respect to all such Certificates and are undertaking to perform certain
administrative and ministerial duties hereunder and is also undertaking to pay
the fees and expenses of the Trustee;
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, and of other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms used herein that are defined in this Article
have the meanings assigned to them in this Article, and include the
plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference herein have the meanings
assigned to them therein;
(3) all references in this Agreement to designated "Articles",
"Sections", "Subsections" and other subdivisions are to the designated
Articles, Sections, Subsections and other subdivisions of this
Agreement;
(4) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to
any particular Article, Section, Subsection or other subdivision; and
(5) unless the context otherwise requires, whenever the words
"including", "include" or "includes" are used herein, it shall be
deemed to be followed by the phrase "without limitation".
Act: With respect to any Certificateholder has the meaning specified in Section 1.04.
Affiliate: Means, with respect to any specified Person, any
other Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such Person. For purposes
of this definition, "control", when used with respect to any specified
Person, means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agent Members: Has the meaning specified in Section 3.05(a).
Aircraft: Means the Leased Aircraft and the Owned Aircraft.
Authorized Agent: Means any Paying Agent or Registrar for the Certificates.
Avoidable Tax: Means a state or local tax (i) upon (w) the
Trust, (x) the Trust Property, (y) Certificateholders or (z) the
Trustee for which the Trustee is entitled to seek reimbursement from
the Trust Property, and (ii) which would be avoided if the Trustee were
located in another state, or jurisdiction within a state, within the
United States. A tax shall not be an Avoidable Tax if the Company or
any Owner Trustee shall agree to pay, and shall pay, such tax.
Book-Entry Certificates: With respect to the Certificates,
means a beneficial interest in the Certificates, ownership and
transfers of which shall be made through book entries as described in
Section 3.04.
Business Day: Means any day other than a Saturday, a Sunday or
a day on which commercial banks are required or authorized to close in
Baltimore, Maryland, New York, New York, or, so long as any Certificate
is outstanding, the city and state in which the Trustee or any Loan
Trustee maintains its Corporate Trust Office or receives and disburses
funds.
Cedel: Means Cedel Bank societe anonyme.
Certificate: Means any one of the Certificates executed and authenticated by the
Trustee, substantially in the form of Exhibit A hereto.
Certificate Account: Means the account or accounts created and maintained pursuant
to Section 4.01(a).
Certificateholder or Holder: Means the Person in whose name a Certificate is
registered in the Register.
Clearing Agency: Means an organization registered as a "clearing agency" pursuant to
Section 17A of the Securities Exchange Act of 1934, as amended.
Clearing Agency Participant: Means a broker, dealer, bank,
other financial institution or other Person for whom from time to time
a Clearing Agency effects, directly or indirectly, book-entry transfers
and pledges of securities deposited with the Clearing Agency.
Company: Means Atlantic Coast Airlines, a California corporation, or its successor in
interest.
Controlling Party: Means the party entitled to act as such pursuant to the terms of
the Intercreditor Agreement.
Corporate Trust Office: With respect to the Trustee or any
Loan Trustee, means the office of such trustee in the city at which at
any particular time its corporate trust business shall be principally
administered.
Cut-off Transfer Date: Means October 2, 1997.
Depositary: Means The Depository Trust Company, its nominees and their respective
successors.
Direction: Has the meaning specified in Section 1.04(c).
Distribution Date: Means each Regular Distribution Date or Special Distribution Date.
Equipment Notes: Means the "secured certificates" issued pursuant to the Indentures.
Escrow Account: Has the meaning specified in Section 2.01(b).
Escrowed Funds: Has the meaning specified in Section 2.01(b).
Euroclear: Means the Euroclear System.
Event of Default: Means the occurrence of an Indenture Default
under any Indenture pursuant to which Equipment Notes held by the Trust
were issued.
Financing Agreements: Means each of the Participation
Agreements and the Note Purchase Agreement listed on Schedule 2 hereto,
as the same may be amended, supplemented or otherwise modified from
time to time in accordance with its terms.
Financing Documents: With respect to any Equipment Note, means
the related Indenture, Financing Agreement and, to the extent
applicable, the Lease and the other relevant documents referred to in
the definitions of "Operative Agreements" contained in the related
Indenture.
Fractional Undivided Interest: Means the fractional undivided interest in the Trust
that is evidenced by a Certificate.
Global Certificates: Has the meaning assigned to such term in Section 3.01.
Guarantor: Means Atlantic Coast Airlines, Inc., a Delaware corporation, or its
successors in interest.
Indentures: Means each Indenture and Security Agreement listed
on Schedule 1 hereto, in each case as the same may be amended or
supplemented or otherwise modified from time to time in accordance with
its terms.
Indenture Default: With respect to any Indenture, means any Indenture Event of
Default (as such term is defined in such Indenture) thereunder.
Initial Purchaser: Means Morgan Stanley & Co. Incorporated.
Initial Regular Distribution Date: Means the first Regular Distribution Date on which
a Scheduled Payment is to be made.
Institutional Accredited Investor: Means an institutional
investor that is an "accredited investor" within the meaning set forth
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act.
Intercreditor Agreement: Means the Intercreditor Agreement
dated September 25, 1997 among the Trustee, the Other Trustees, the
Liquidity Provider, the liquidity providers, if any, relating to the
Certificates issued under (and as defined in) the Other Pass Through
Trust Agreements, and The First National Bank of Maryland, as
Subordination Agent thereunder, as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
Issuance Date: Means the date of the issuance of the Initial Certificates.
Lease: Means, with respect to each Leased Aircraft, the lease
between an Owner Trustee, as the lessor, and the Company, as the
lessee, referred to in the related Indenture, as each such lease may be
amended or supplemented in accordance with its respective terms; and
Leases means all such leases.
Leased Aircraft: Has the meaning specified in the first recital to this Agreement.
Letter of Representations: Means the agreement dated the Issuance Date among the
Company, the Trustee and the initial Clearing Agency.
Liquidity Facility: Means the Irrevocable Revolving Credit
Agreement dated September 25, 1997 relating to the Certificates,
between the Liquidity Provider and the Subordination Agent, as amended,
replaced, supplemented or otherwise modified from time to time in
accordance with its terms and the terms of the Intercreditor Agreement.
Liquidity Provider: Means, initially, ING Bank N.V., and any replacement or
successor therefor appointed in accordance with the Liquidity Facility and the Intercreditor
Agreement.
Loan Trustee: With respect to any Equipment Note or the
Indenture applicable thereto, means the bank or trust company
designated as loan or indenture trustee under such Indenture; and any
successor to such Loan Trustee as such trustee; and Loan Trustees means
all of the Loan Trustees under the Indentures.
Non-U.S. Person: Means a Person that is not a U.S. Person, as defined in Regulation S.
Officer's Certificate: Means a certificate signed, (a) in the
case of the Guarantor or the Company, by (i) the President or any
Executive Vice President or Senior Vice President of the Guarantor or
the Company, signing alone or (ii) any Vice President of the Guarantor
or the Company signing together with the Secretary, the Assistant
Secretary, the Treasurer or any Assistant Treasurer of the Guarantor or
the Company or (b) in the case of the Trustee or an Owner Trustee or a
Loan Trustee, a Responsible Officer of the Trustee or such Owner
Trustee or such Loan Trustee, as the case may be.
Offshore Certificates Exchange Date: Has the meaning specified in Section 3.01.
Offshore Global Certificates: Has the meaning assigned to such term in Section 3.01.
Offshore Physical Certificates: Has the meaning assigned to such term in Section 3.01.
Opinion of Counsel: Means a written opinion of legal counsel
who (a) in the case of counsel for the Guarantor or the Company may be
(i) a senior attorney in rank of the officers of the Guarantor or the
Company a principal duty of which is furnishing advice as to legal
matters or (ii) such other counsel designated by the Guarantor or the
Company and reasonably acceptable to the Trustee and (b) in the case of
any Owner Trustee or any Loan Trustee may be such counsel as may be
designated by any of them whether or not such counsel is an employee of
any of them, and who shall be reasonably acceptable to the Trustee.
Other Pass Through Trust Agreement: Means each of the three
other Atlantic Coast Airlines 1997-1 Pass Through Trust Agreements
relating to Atlantic Coast Airlines 1997-1B Pass Through Trust,
Atlantic Coast Airlines 1997-1C Pass Through Trust and Atlantic Coast
Airlines 1997-1D Pass Through Trust, each dated the date hereof; and
Other Pass Through Trust Agreements means all such agreements.
Other Trustee: Means the trustee under each of the Other Pass
Through Trust Agreements, and any successor or other trustee appointed
as provided therein; and Other Trustees means all such trustees.
Outstanding: With respect to Certificates, means, as of the date of determination,
all Certificates theretofore authenticated and delivered under this Agreement, except:
(i) Certificates theretofore cancelled by the Registrar or delivered to
the Trustee or the Registrar for cancellation;
(ii) All of the Certificates if money in the full
amount required to make the final distribution with respect
thereto pursuant to Section 11.01 hereof has been theretofore
deposited with the Trustee in trust for the Holders of such
Certificates as provided in Section 4.01 pending distribution
of such money to such Certificateholders pursuant to such
final distribution payment; and
(iii) Certificates in exchange for or in lieu of
which other Certificates have been authenticated and delivered
pursuant to this Agreement.
Owned Aircraft: Has the meaning specified in the first recital to this Agreement.
Owner Participant: With respect to any Equipment Note relating
to a Leased Aircraft, means the "Owner Participant" as referred to in
the Indenture pursuant to which such Equipment Note is issued and any
permitted successor or assign of such Owner Participant; and Owner
Participants at any time of determination means all of the Owner
Participants thus referred to in the Indentures.
Owner Trustee: With respect to any Equipment Note relating to
a Leased Aircraft, means the "Owner Trustee", as referred to in the
Indenture pursuant to which such Equipment Note is issued, not in its
individual capacity but solely as trustee; and Owner Trustees means all
of the Owner Trustees party to any of the Indentures.
Participation Agreement: With respect to any Leased Aircraft,
means the related Participation Agreement listed on Schedule 2 hereto,
as the same may be amended, supplemented or otherwise modified from
time to time in accordance with its terms; and Participation Agreements
means all such agreements.
Paying Agent: Means the paying agent maintained and appointed for the Certificates
pursuant to Section 7.12.
Permanent Offshore Global Certificates: Has the meaning specified in Section 3.01.
Permitted Investments: Means obligations of the United States
of America or agencies or instrumentalities thereof for the payment of
which the full faith and credit of the United States of America is
pledged, maturing in not more than 60 days or such lesser time as is
necessary for payment of any Special Payments on a Special Distribution
Date or any mutual fund the portfolio of which is limited to such
obligations, including any proprietary mutual fund of The First
National Bank of Maryland for which such bank or an affiliate is
investment advisor or to which such bank provides other services and
receives reasonable compensation for such services.
Person: Means any person, including any individual,
corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, or government or any
agency or political subdivision thereof.
Physical Certificates: Has the meaning specified in Section 3.01.
Pool Balance: Means, as of any date, (i) the original
aggregate face amount of the Certificates less (ii) the aggregate
amount of all payments made in respect of such Certificates other than
payments made in respect of interest or premium thereon or
reimbursement of any costs or expenses incurred in connection
therewith. The Pool Balance as of any Distribution Date shall be
computed after giving effect to the payment of principal, if any, on
the Equipment Notes or other Trust Property held in the Trust and the
distribution thereof to be made on such Distribution Date.
Pool Factor: Means, as of any date, the quotient (rounded to
the seventh decimal place) computed by dividing (i) the Pool Balance as
at such date by (ii) the original aggregate face amount of the
Certificates. The Pool Factor as of any Distribution Date shall be
computed after giving effect to the payment of principal, if any, on
the Equipment Notes or other Trust Property and the distribution
thereof to be made on such Distribution Date.
Postponed Notes: Means the Equipment Notes to be held in the Trust as to which a
Postponement Notice shall have been delivered pursuant to Section 2.01(b).
Postponement Notice: Means an Officer's Certificate of the
Company (1) requesting that the Trustee temporarily postpone purchase
pursuant to one or more of the Financing Agreements of certain of the
Equipment Notes to a date which is later than the Issuance Date, (2)
identifying the amount of the purchase price of each such Equipment
Note and the aggregate purchase price for all such Equipment Notes, (3)
setting forth the reasons for such postponement and (4) with respect to
each such Equipment Note, either (a) setting or resetting a new
Transfer Date (which shall be on or prior to the Cut-Off Transfer Date
for payment by the Trustee of such purchase price and issuance of the
related Equipment Note, or (b) indicating that such new Transfer Date
(which shall be on or prior to the Cut-off Transfer Date) will be set
by subsequent written notice not less than one Business Day prior to
such new Transfer Date.
Private Placement Legend: Has the meaning specified in Section 3.02.
QIB: Means a qualified institutional buyer as defined in Rule 144A.
Record Date: Means (i) for Scheduled Payments to be
distributed on any Regular Distribution Date, other than the final
distribution, the 15th day (whether or not a Business Day) preceding
such Regular Distribution Date, and (ii) for Special Payments to be
distributed on any Special Distribution Date, other than the final
distribution, the 15th day (whether or not a Business Day) preceding
such Special Distribution Date.
Register and Registrar: Mean the register maintained and the registrar appointed
pursuant to Sections 3.04 and 7.12.
Regular Distribution Date: With respect to distributions of
Scheduled Payments in respect of the Certificates, means each date
designated as a Regular Distribution Date in this Agreement, until
payment of all the Scheduled Payments to be made under the Equipment
Notes held in the Trust have been made; provided, however, that, if any
such day shall not be a Business Day, the related distribution shall be
made on the next succeeding Business Day without additional interest.
Regulation S: Means Regulation S under the Securities Act or
any successor regulation thereto.
Request: Means a request by the Company setting forth the
subject matter of the request accompanied by an Officer's Certificate
and an Opinion of Counsel as provided in Section 1.02 of this
Agreement.
Responsible Officer: With respect to the Trustee, any Loan
Trustee and any Owner Trustee, means any officer in the Corporate Trust
Division of the Trustee, Loan Trustee or Owner Trustee or any other
officer customarily performing functions similar to those performed by
the persons who at the time shall be such officers, respectively, or to
whom any corporate trust matter is referred because of his knowledge of
and familiarity with a particular subject.
Rule 144A: Means Rule 144A under the Securities Act and any
successor regulation thereto.
Scheduled Payment: With respect to any Equipment Note, means
any payment of principal and interest on such Equipment Note or any
payment of interest on the Certificates with funds drawn under the
Liquidity Facility (other than any such payment which is not in fact
received by the Trustee or any Subordination Agent within five days of
the date on which such payment is scheduled to be made) due from the
obligor thereon which payment represents the installment of principal
at the stated maturity of such installment of principal on such
Equipment Note, the payment of regularly scheduled interest accrued on
the unpaid principal amount of such Equipment Note, or both; provided
that any payment of principal, premium, if any, or interest resulting
from the redemption or purchase of any Equipment Note shall not
constitute a Scheduled Payment.
SEC: Means the Securities and Exchange Commission, as from
time to time constituted or created under the Securities Exchange Act
of 1934, as amended, or, if at any time after the execution of this
instrument such Commission is not existing and performing the duties
now assigned to it under the Trust Indenture Act, then the body
performing such duties on such date.
Securities Act: Means the United States Securities Act of 1933, as amended from time
to time, or any successor thereto.
Special Distribution Date: Means each date on which a Special
Payment is to be distributed as specified in this Agreement; provided,
however, that, if any such day shall not be a Business Day, the related
distribution shall be made on the next succeeding Business Day without
additional interest.
Special Payment: Means (i) any payment (other than a Scheduled
Payment) in respect of, or any proceeds of, any Equipment Note or Trust
Indenture Estate (as defined in each Indenture), (ii) the amounts
required to be distributed pursuant to the last paragraph of Section
2.01(b) or (iii) the amounts required to be distributed pursuant to the
penultimate paragraph of Section 2.01(b).
Special Payments Account: Means the account or accounts created and maintained
pursuant to Section 4.01(b).
Specified Investments: Means (i) obligations of, or guaranteed
by, the United States Government or agencies thereof, (ii) open market
commercial paper of any corporation incorporated under the laws of the
United States of America or any State thereof rated at least P-2 or its
equivalent by Moody's Investors Service, Inc. or at least A-2 or its
equivalent by Standard & Poor's Rating Group, (iii) certificates of
deposit issued by commercial banks organized under the laws of the
United States or of any political subdivision thereof having a combined
capital and surplus in excess of $500,000,000 which banks or their
holding companies have a rating of A or its equivalent by Moody's
Investors Service, Inc. or Standard & Poor's Rating Group; provided,
however, that the aggregate amount at any one time so invested in
certificates of deposit issued by any one bank shall not exceed 5% of
such bank's capital and surplus, (iv) U.S. dollar denominated offshore
certificates of deposit issued by, or offshore time deposits with, any
commercial bank described in (iii) or any subsidiary thereof, (v)
repurchase agreements with any financial institution having combined
capital and surplus of at least $500,000,000 with any of the
obligations described in clauses (i) through (iv) as collateral and
(vi) any mutual fund the portfolio of which is limited to investments
of the types specified in the preceding clauses (i) through (v),
including any proprietary mutual fund of The First National Bank of
Maryland for which such bank or an affiliate is investment advisor or
to which such bank provides other services and receives reasonable
compensation for such services; provided further that if all of the
above investments are unavailable, the entire amounts to be invested
may be used to purchase Federal Funds from an entity described in
clause (iii) above.
Subordination Agent: Has the meaning specified in the Intercreditor Agreement.
Temporary Offshore Global Certificates: Has the meaning specified in Section 3.01.
Transfer Date: Has the meaning assigned to the term "Delivery Date" in each Financing
Agreement.
Triggering Event: Has the meaning assigned to such term in the Intercreditor
Agreement.
Trust: Means the trust created by this Agreement, the estate of which consists of the
Trust Property.
Trust Indenture Act: Except as otherwise provided in Section 9.06, means the United
States Trust Indenture Act of 1939 as in force at the date hereof.
Trust Property: Means (i) the Equipment Notes held as the
property of the Trust, all monies at any time paid thereon and all
monies due and to become due thereunder, (ii) the rights of the Trust
under any Intercreditor Agreement, including all monies receivable in
respect of such rights, (iii) all monies receivable under the Liquidity
Facility and (iv) funds from time to time deposited in the Escrow
Account, the Certificate Account and the Special Payments Account and
any proceeds from the sale by the Trustee pursuant to Article VI hereof
of any such Equipment Note.
Trustee: Means The First National Bank of Maryland, or its successor in interest, and
any successor or other trustee appointed as provided herein.
Trustee's Lien: Has the meaning specified in Section 7.17.
U.S. Global Certificate: Has the meaning specified in Section 3.01.
U.S. Physical Certificates: Has the meaning specified in Section 3.01.
Section 1.02. Compliance Certificates and Opinions. Upon any
application or request by the Company, any Owner Trustee or any Loan Trustee to
the Trustee to take any action under any provision of this Agreement, the
Company, such Owner Trustee or such Loan Trustee, as the case may be, shall
furnish to the Trustee (i) an Officer's Certificate stating that, in the opinion
of the signers, all conditions precedent, if any, provided for in this Agreement
relating to the proposed action have been complied with and (ii) an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement (other than a certificate
provided pursuant to Section 8.04(d)) shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions in
this Agreement relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.03. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any Opinion of Counsel stated to be based on the opinion of
other counsel shall be accompanied by a copy of such other opinion.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Agreement, they may, but need not, be consolidated
and form one instrument.
Section 1.04. Acts of Certificateholders. (a) Any direction,
consent, waiver or other action provided by this Agreement to be given or taken
by Certificateholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Certificateholders in
person or by an agent or proxy duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee and, where it is hereby
expressly required pursuant to this Agreement, to the Company or any Loan
Trustee. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the
Certificateholders signing such instrument or instruments. Proof of execution of
any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee, the Company and any Loan Trustee, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the certificate of any notary public
or other officer of any jurisdiction authorized to take acknowledgments of deeds
or administer oaths that the Person executing such instrument acknowledged to
him the execution thereof, or by an affidavit of a witness to such execution
sworn to before any such notary or such other officer and where such execution
is by an officer of a corporation or association or a member of a partnership,
on behalf of such corporation, association or partnership, such certificate or
affidavit shall also constitute sufficient proof of his authority. The fact and
date of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other reasonable manner
which the Trustee deems sufficient.
(c) In determining whether the Certificateholders of the
requisite Fractional Undivided Interests of Certificates Outstanding have given
any direction, consent or waiver (a "Direction") under this Agreement,
Certificates owned by the Company, the Guarantor, any Owner Trustee, any Owner
Participant or any Affiliate of any such Person thereof shall be disregarded and
deemed not to be Outstanding for purposes of any such determination. In
determining whether the Trustee shall be protected in relying upon any such
Direction, only Certificates which the Trustee knows to be so owned shall be so
disregarded. Notwithstanding the foregoing, (i) if any such Person owns 100% of
the Certificates Outstanding, such Certificates shall not be so disregarded as
aforesaid, and (ii) if any amount of Certificates so owned by any such Person
have been pledged in good faith, such Certificates shall not be disregarded as
aforesaid if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Certificates and that the pledgee
is not the Company, the Guarantor, any Owner Trustee, any Owner Participant or
any Affiliate of any such Person.
(d) The Company may at its option, by delivery of an Officer's
Certificate to the Trustee, set a record date to determine the
Certificateholders entitled to give any consent, request, demand, authorization,
direction, notice, waiver or other Act. Such record date shall be the record
date specified in such Officer's Certificate, which shall be a date not more
than 30 days prior to the first solicitation of Certificateholders in connection
therewith. If such a record date is fixed, such consent, request, demand,
authorization, direction, notice, waiver or other Act may be given before or
after such record date, but only the Certificateholders of record at the close
of business on such record date shall be deemed to be Certificateholders for the
purposes of determining whether Certificateholders of the requisite proportion
of Outstanding Certificates have authorized or agreed or consented to such
consent, request, demand, authorization, direction, notice, waiver or other Act,
and for that purpose the Outstanding Certificates shall be computed as of such
record date; provided that no such consent, request, demand, authorization,
direction, notice, waiver or other Act by the Certificateholders on such record
date shall be deemed effective unless it shall become effective pursuant to the
provisions of this Agreement not later than one year after such record date.
(e) Any direction, consent, waiver or other action by the
Certificateholder of any Certificate shall bind the Certificateholder of every
Certificate issued upon the transfer thereof or in exchange therefor or in lieu
thereof, whether or not notation of such action is made upon such Certificate.
(f) Except as otherwise provided in Section 1.04(c),
Certificates owned by or pledged to any Person shall have an equal and
proportionate benefit under the provisions of this Agreement, without
preference, priority, or distinction as among all of the Certificates.
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
Section 2.01. Issuance of Certificates; Acquisition of
Equipment Notes. (a) The Trustee is hereby directed to execute and deliver the
Intercreditor Agreement and each of the Financing Agreements on or prior to the
Issuance Date, each in the form delivered to the Trustee by the Company. Upon
oral or written request of the Company or the Company's counsel acting on behalf
of the Company and the satisfaction of the closing conditions specified in each
of the Financing Agreements, the Trustee shall execute, deliver and authenticate
Certificates equalling in the aggregate the aggregate principal amount of the
Equipment Notes to be purchased by the Trustee pursuant to each of the Financing
Agreements on the Transfer Date, and evidencing the entire ownership interest in
the Trust. The Trustee shall issue and sell such Certificates, in authorized
denominations and in such Fractional Undivided Interests, so as to result in the
receipt of consideration in an amount equal to the aggregate purchase price of
such Equipment Notes and, concurrently therewith, the Trustee shall purchase,
pursuant to the terms and conditions of the Financing Agreements, the Equipment
Notes at a purchase price equal to the amount of such consideration so received.
Except as provided in Sections 3.04 and 3.07 hereof, the Trustee shall not
execute, authenticate or deliver Certificates in excess of the aggregate amount
specified in this paragraph. The provisions of this Subsection (a) are subject
to the provisions of Subsection (b) below.
(b) If on or prior to the Issuance Date the Company shall
deliver to the Trustee a Postponement Notice relating to one or more Postponed
Notes, the Trustee shall postpone the purchase of such Postponed Notes and shall
deposit into an escrow account (the "Escrow Account") to be maintained as a part
of the Trust an amount equal to the purchase price of such Postponed Notes (the
"Escrowed Funds"). The Escrowed Funds so deposited shall be invested by the
Trustee at the written direction of the Company in Specified Investments (i)
maturing no later than any scheduled Transfer Date relating to the Postponed
Notes or (ii) if no such Transfer Date has been scheduled, maturing on the next
Business Day, or (iii) if the Company has given notice to the Trustee that any
Postponed Notes will not be issued, with respect to the portion of the Escrowed
Funds relating to such Postponed Notes, maturing on the next applicable Special
Distribution Date, if such investments are reasonably available for purchase.
The Trustee shall make withdrawals from the Escrow Account only as provided in
this Agreement. Upon request of the Company on one or more occasions and the
satisfaction of the closing conditions specified in the applicable Financing
Agreements on or prior to the related Cut-off Transfer Date, the Trustee shall
purchase the applicable Postponed Notes with the Escrowed Funds withdrawn from
the Escrow Account. The purchase price shall equal the principal amount of such
Postponed Notes.
The Trustee shall hold all Specified Investments until the
maturity thereof and will not sell or otherwise transfer Specified Investments.
If Specified Investments held in an Escrow Account mature prior to any
applicable Transfer Date, any proceeds received on the maturity of such
Specified Investments (other than any earnings thereon) shall be reinvested by
the Trustee at the written direction of the Company in Specified Investments
maturing as provided in the preceding paragraph.
Any earnings on Specified Investments received from time to
time by the Trustee shall be promptly distributed to the Company. The Company
shall pay to the Trustee for deposit to the Escrow Account an amount equal to
any losses on such Specified Investments as incurred.
On the Initial Regular Distribution Date, the Company will pay
(in immediately available funds) to the Trustee an amount equal to the interest
that would have accrued on any Postponed Notes, if any, purchased after the
Issuance Date if such Postponed Notes had been purchased on the Issuance Date,
from the Issuance Date to, but not including, the date of the purchase of such
Postponed Notes by the Trustee.
If the Company notifies the Trustee prior to the Cut-off
Transfer Date that any Postponed Notes will not be issued on or prior to the
Cut-off Transfer Date for any reason, on the next Special Distribution Date
occurring more than 20 days following the date of such notice (i) the Company
shall pay to the Trustee for deposit in the Special Payments Account, in
immediately available funds, an amount equal to the interest that would have
accrued on the Postponed Notes designated in such notice at a rate equal to the
interest rate applicable to the Certificates from the Issuance Date to, but not
including, such Special Distribution Date and (ii) the Trustee shall transfer an
amount equal to that amount of Escrowed Funds that would have been used to
purchase the Postponed Notes designated in such notice and the amount paid by
the Company pursuant to the immediately preceding clause (i) to the related
Special Payments Account for distribution as a Special Payment in accordance
with the provisions hereof.
If, on the Cut-off Transfer Date, an amount equal to less than
all of the Escrowed Funds (other than Escrowed Funds referred to in the
immediately preceding paragraph) has been used to purchase Postponed Notes, on
the next Special Distribution Date occurring more than 20 days following the
Cut-off Transfer Date (i) the Company shall pay to the Trustee for deposit in
the Special Payments Account, in immediately available funds, an amount equal to
the interest that would have accrued on such Postponed Notes contemplated to be
purchased with such unused Escrowed Funds (other than Escrowed Funds referred to
in the immediately preceding paragraph) but not so purchased at a rate equal to
the interest rate applicable to the Certificates from the Issuance Date to, but
not including, such Special Distribution Date and (ii) the Trustee shall
transfer such unused Escrowed Funds and the amount paid by the Company pursuant
to the immediately preceding clause (i) to such Special Payments Account for
distribution as a Special Payment in accordance with the provisions hereof.
Section 2.02. Acceptance by Trustee. The Trustee, upon the
execution and delivery of this Agreement, acknowledges its acceptance of all
right, title and interest in and to the Equipment Notes acquired pursuant to
Section 2.01 hereof and the Financing Agreements and declares that the Trustee
holds and will hold such right, title and interest, together with all other
property constituting the Trust Property, for the benefit of all then present
and future Certificateholders, upon the trusts herein set forth. Subject to
Section 7.14, the Trustee shall take all actions reasonably necessary to effect
the registration of all such Equipment Notes in the name of the Subordination
Agent. By its payment for and acceptance of each Certificate issued to it under
this Agreement, each initial Certificateholder as grantor of the Trust thereby
joins in the creation and declaration of the Trust.
Section 2.03. Limitation of Powers. The Trust is constituted
solely for the purpose of making the investment in the Equipment Notes, and,
except as set forth herein, the Trustee shall not be authorized or empowered to
acquire any other investments or engage in any other activities and, in
particular, the Trustee shall not be authorized or empowered to do anything that
would cause such Trust to fail to qualify as a "grantor trust" for federal
income tax purposes (including as subject to this restriction, acquiring any
Aircraft (as defined in the respective Indentures) by bidding such Equipment
Notes or otherwise, or taking any action with respect to any such Aircraft once
acquired).
ARTICLE III
THE CERTIFICATES
Section 3.01. Title, Form, Denomination and Execution of
Certificates. (a) The Certificates shall be known as the "7.20% 1997-1A Pass
Through Certificates" of the Trust. Each Certificate will represent a fractional
undivided interest in the Trust and shall be substantially in the form set forth
as Exhibit A hereto, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Agreement and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Certificates, as evidenced by their execution of the
Certificates. Any portion of the text of any Certificate may be set forth on the
reverse thereof, with an appropriate reference thereto on the face of the
Certificate.
(b) The Certificates shall be issued only in fully registered
form without coupons and only in denominations of $100,000 or integral multiples
of $1,000 in excess thereof, except that one Certificate may be issued in a
denomination of less than $100,000. Each Certificate shall be dated the date of
its authentication. The aggregate Fractional Undivided Interest of Certificates
shall not at any time exceed $57,714,000.
(c) Certificates offered and sold in reliance on Rule 144A
shall be issued initially in the form of a single permanent global Certificate
in registered form, substantially in the form set forth as Exhibit A hereto (the
"U.S. Global Certificate"), duly executed and authenticated by the Trustee as
hereinafter provided. The U.S. Global Certificate will be registered in the name
of a nominee for the Depositary and deposited with the Trustee, as custodian for
the Depositary. The aggregate principal amount of the U.S. Global Certificate
may from time to time be increased or decreased by adjustments made on the
records of the Depositary or its nominee, or of the Trustee, as custodian for
the Depositary or its nominee, as hereinafter provided.
(d) Certificates offered and sold in offshore transactions in
reliance on Regulation S shall be issued initially in the form of a single
temporary global Certificate in registered form, substantially in the form set
forth as Exhibit A hereto (the "Temporary Offshore Global Certificate") duly
executed and authenticated by the Trustee as hereinafter provided. The Temporary
Offshore Global Certificate will be registered in the name of a nominee of the
Depositary for credit to the account of the Agent Members acting as depositaries
for Euroclear and Cedel and deposited with the Trustee as custodian for the
Depositary. At any time on or after November 5, 1997 (the "Offshore Certificates
Exchange Date"), upon receipt by the Trustee of a certificate substantially in
the form of Exhibit B hereto, a single permanent global Certificate in
registered form substantially in the form set forth in Exhibit A (the "Permanent
Offshore Global Certificate"; and together with the Temporary Offshore Global
Certificate, the "Offshore Global Certificates"), duly executed and
authenticated by the Trustee as hereinafter provided, shall be registered in the
name of a nominee for the Depositary and deposited with the Trustee, as
custodian for the Depositary, and the Registrar shall reflect on its books and
records the date of such transfer and a decrease in the principal amount of any
Temporary Offshore Global Certificate in an amount equal to the principal amount
of the beneficial interest in such Temporary Offshore Global Certificate
transferred. The U.S. Global Certificate and the Offshore Global Certificates
are sometimes referred to as the "Global Certificates".
(e) Certificates offered and sold to Institutional Accredited
Investors shall be issued in the form of permanent certificated Certificates in
registered form in substantially the form set forth as Exhibit A hereto (the
"U.S. Physical Certificates"). Certificates issued pursuant to Section 3.05(b)
in exchange for interests in any Offshore Global Certificate shall be in the
form of permanent certificated Certificates in registered form substantially in
the form set forth in Exhibit A (the "Offshore Physical Certificates"). The
Offshore Physical Certificates and U.S. Physical Certificates are sometimes
collectively herein referred to as the "Physical Certificates".
(f) The definitive Certificates shall be in registered form
and shall be typed, printed, lithographed or engraved or produced by any
combination of these methods or may be produced in any other manner, all as
determined by the officers executing such Certificates, as evidenced by their
execution of such Certificates.
Section 3.02. Restrictive Legends. (a) Subject to Section 3.06, each Global
Certificate (other than the Permanent Offshore Global Certificate) and each U.S. Physical Certificate
shall bear the following legend (the "Private Placement Legend") on the face thereof:
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO,
OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN
THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT), (B) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED
INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
CERTIFICATE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S
UNDER THE SECURITIES ACT; (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS
AFTER THE LATER OF THE ORIGINAL ISSUANCE OF THIS CERTIFICATE OR THE
LAST DATE ON WHICH THIS CERTIFICATE WAS HELD BY ATLANTIC COAST AIRLINES
("ACA") OR ANY AFFILIATE OF ACA, RESELL OR OTHERWISE TRANSFER THIS
CERTIFICATE EXCEPT (A) TO ACA OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE
UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING $100,000 OR MORE AGGREGATE
PRINCIPAL AMOUNT OF SUCH CERTIFICATES THAT, PRIOR TO SUCH TRANSFER,
FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER
OF THIS CERTIFICATE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE
TRUSTEE), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT; AND (3) AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THIS CERTIFICATE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY
TRANSFER OF THIS CERTIFICATE WITHIN TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE OF THIS CERTIFICATE OR THE LAST DATE ON WHICH THIS
CERTIFICATE WAS HELD BY ACA OR AN AFFILIATE OF ACA, THE HOLDER MUST
CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO
THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE.
IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND ACA
SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF
THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE
TERMS "OFFSHORE TRANSACTION", "UNITED STATES" AND "U.S. PERSON" HAVE
THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
THE PASS THROUGH TRUST AGREEMENT CONTAINS A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS CERTIFICATE IN
VIOLATION OF THE FOREGOING RESTRICTIONS.
(b) Each Global Certificate shall also bear the following legend on the face
thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 3.05 AND 3.06 OF THE PASS THROUGH
TRUST AGREEMENT REFERRED TO HEREIN.
Section 3.03. Authentication of Certificates. (a) The Trustee
shall duly execute, authenticate and deliver Certificates in authorized
denominations equalling in the aggregate the aggregate principal amount of the
Equipment Notes to be purchased by the Trustee pursuant to the Financing
Agreements and evidencing the entire ownership of the Trust.
(b) No Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose, unless there appears on
such Certificate a certificate of authentication substantially in the form
provided for herein executed by the Trustee by the manual signature of one of
its authorized signatories, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.
Section 3.04. Transfer and Exchange. The Trustee shall cause
to be kept at the office or agency to be maintained by it in accordance with the
provisions of Section 7.12 of this Agreement a register (the "Register") for the
Certificates in which, subject to such reasonable regulations as it may
prescribe, the Trustee shall provide for the registration of the Certificates
and of transfers and exchanges of the Certificates as herein provided. The
Trustee shall initially be the registrar (the "Registrar") for the purpose of
registering the Certificates and transfers and exchanges of the Certificates as
herein provided. A Certificateholder may transfer a Certificate by written
application to the Registrar stating the name of the proposed transferee and
otherwise complying with the terms of this Agreement, including providing a
written certificate or other evidence of compliance with any restrictions on
transfer. No such transfer shall be effected until, and such transferee shall
succeed to the rights of a Certificateholder only upon, final acceptance and
registration of the transfer by the Registrar in the Register. Prior to the
registration of any transfer by a Certificateholder as provided herein, the
Trustee shall treat the person in whose name the Certificate is registered as
the owner thereof for all purposes, and the Trustee shall not be affected by
notice to the contrary. Furthermore, the Depositary shall, by acceptance of a
Global Certificate, agree that transfers of beneficial interests in such Global
Certificate may be effected only through a book-entry system maintained by the
Depositary (or its agent), and that ownership of a beneficial interest in the
Certificate shall be required to be reflected in a book entry. When Certificates
are presented to the Registrar with a request to register the transfer or to
exchange them for an equal face amount of Certificates of other authorized
denominations, the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transactions are met. To permit
registrations of transfers and exchanges in accordance with the terms,
conditions and restrictions hereof, the Trustee shall execute and authenticate
Certificates at the Registrar's request. No service charge shall be made for any
registration of transfer or exchange of the Certificates, but the Trustee may
require payment by the transferor of a sum sufficient to cover any transfer tax
or similar governmental charge payable in connection therewith (other than any
such transfer taxes or other similar governmental charges payable upon exchanges
pursuant to Section 3.10 or 9.07).
Section 3.05. Book-Entry Provisions for U.S. Global
Certificate and Offshore Global Certificates. (a) Members of, or participants
in, the Depositary ("Agent Members") shall have no rights under this Agreement
with respect to any Global Certificate held on their behalf by the Depositary,
or the Trustee as its custodian, and the Depositary may be treated by the
Trustee and any agent of the Trustee as the absolute owner of such Global
Certificate for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Trustee or any agent of the Trustee from giving effect
to any written certification, proxy or other authorization furnished by the
Depositary or shall impair, as between the Depositary and its Agent Members, the
operation of customary practices governing the exercise of the rights of a
holder of any Certificate. Upon the issuance of any Global Certificate, the
Registrar or its duly appointed agent shall record a nominee of the Depositary
as the registered holder of such Global Certificate.
(b) Transfers of any Global Certificate shall be limited to
transfers of such Global Certificate in whole, but not in part, to nominees of
the Depositary, its successor or such successor's nominees. Beneficial interests
in the U.S. Global Certificate and any Offshore Global Certificate may be
transferred in accordance with the rules and procedures of the Depositary and
the provisions of Section 3.06. Beneficial interests in the U.S. Global
Certificate or an Offshore Global Certificate shall be delivered to all
beneficial owners in the form of U.S. Physical Certificates or Offshore Physical
Certificates, as the case may be, if (i) the Company notifies the Trustee in
writing that the Depositary is unwilling or unable to discharge properly its
responsibilities as Depositary for the U.S. Global Certificate or such Offshore
Global Certificate, as the case may be, and the Company is unable to locate a
qualified successor depositary within 90 days of such notice or (ii) after the
occurrence of an Event of Default, beneficial owners of the U.S. Global
Certificate or Offshore Global Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust, by Act
of such Certificateholders delivered to the Company and the Trustee, advise the
Company, the Trustee and the Depositary through its Clearing Agency Participants
in writing that the continuation of a book-entry system through the Depositary
is no longer in the best interests of the Certificateholders, then the Trustee
shall notify all owners of beneficial interests in the U.S. Global Certificate
or an Offshore Global Certificate, through the Depositary, of the occurrence of
any such event and the availability of definitive Certificates.
(c) Any beneficial interest in one of the Global Certificates
that is transferred to a Person who takes delivery in the form of an interest in
the other Global Certificate will, upon such transfer, cease to be an interest
in such Global Certificate and become an interest in the other Global
Certificate and, accordingly, will thereafter be subject to all transfer
restrictions, if any, and other procedures applicable to beneficial interests in
such other Global Certificate for as long as it remains such an interest.
(d) [Intentionally omitted.]
(e) In connection with the transfer of the entire U.S. Global
Certificate or an entire Offshore Global Certificate to the beneficial owners
thereof pursuant to paragraph (b) of this Section 3.05, such U.S. Global
Certificate or Offshore Global Certificate, as the case may be, shall be deemed
to be surrendered to the Trustee for cancellation, and the Trustee shall
execute, authenticate and deliver, to each beneficial owner identified by the
Depositary in exchange for its beneficial interest in such U.S. Global
Certificate or Offshore Global Certificate, as the case may be, an equal
aggregate principal amount of U.S. Physical Certificates or Offshore Physical
Certificates, as the case may be, of authorized denominations.
(f) Any U.S. Physical Certificate delivered in exchange for an
interest in the U.S. Global Certificate pursuant to paragraph (b) of this
Section 3.05 shall, except as otherwise provided by paragraph (f) of Section
3.06, bear the Private Placement Legend.
(g) Any Offshore Physical Certificate delivered in exchange
for an interest in an Offshore Global Certificate pursuant to paragraph (b) of
this Section shall, except as otherwise provided by paragraph (f) of Section
3.06, bear the applicable legend regarding transfer restrictions set forth in
Section 3.02(a).
(h) The registered holder of the U.S. Global Certificate or
any Offshore Global Certificate may grant proxies and otherwise authorize any
Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Agreement or the Certificates.
Section 3.06. Special Transfer Provisions. The following provisions shall apply to
the Certificates:
(a) Transfers to Non-QIB Institutional Accredited Investors.
The following provisions shall apply with respect to the registration of any
proposed transfer of a Certificate to any Institutional Accredited Investor
which is not a QIB (excluding transfers to or by Non-U.S. Persons):
(i) The Registrar shall register the transfer of any
Certificate, whether or not such Certificate bears the Private
Placement Legend, if (x) the requested transfer is at least two years
after the later of the original issue date of the Certificates and the
last date on which such Certificate was held by the Company or any
affiliate thereof or (y) the proposed transferee has delivered to the
Registrar a letter substantially in the form of Exhibit D hereto and
the aggregate principal amount of the Certificates being transferred is
at least $100,000.
(ii) If the proposed transferor is an Agent Member holding a
beneficial interest in the U.S. Global Certificate, upon receipt by the
Registrar of (x) the documents, if any, required by paragraph (i) and
(y) instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date of the transfer and a decrease in the principal amount
of such U.S. Global Certificate in an amount equal to the principal
amount of the beneficial interest in such U.S. Global Certificate to be
transferred, and the Company shall execute, and the Trustee shall
authenticate and deliver to the transferor or at its direction, one or
more U.S. Physical Certificates of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with respect to the
registration of any proposed transfer of a Certificate to a QIB (excluding Non-U.S. Persons):
(i) If the Certificate to be transferred consists of U.S.
Physical Certificates or an interest in any Temporary Offshore Global
Certificate, the Registrar shall register the transfer if such transfer
is being made by a proposed transferor who has checked the box provided
for on the form of Certificate stating, or has otherwise advised the
Trustee and the Registrar in writing, that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has
signed the certification provided for on the form of Certificate
stating, or has otherwise advised the Trustee and the Registrar in
writing, that it is purchasing the Certificate for its own account or
an account with respect to which it exercises sole investment
discretion and that it, or the Person on whose behalf it is acting with
respect to any such account, is a QIB within the meaning of Rule 144A,
and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the
Trust and/or the Company as it has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware
that the transferor is relying upon its foregoing representations in
order to claim the exemption from registration provided by Rule 144A.
(ii) Upon receipt by the Registrar of the documents referred
to in clause (i) above and instructions given in accordance with the
Depositary's and the Registrar's procedures therefor, the Registrar
shall reflect on its books and records the date of such transfer and an
increase in the principal amount of the U.S. Global Certificate in an
amount equal to the principal amount of the U.S. Physical Certificates
or interests in the Temporary Offshore Global Certificate, as the case
may be, being transferred, and the Trustee shall cancel such Physical
Certificates or decrease the amount of such Temporary Offshore Global
Certificate so transferred.
(c) [Intentionally omitted.]
(d) Transfers of Interests in the Permanent Offshore Global
Certificate or Offshore Physical Certificates. The Registrar shall register any
transfer of interests in the Permanent Offshore Global Certificate or Offshore
Physical Certificates without requiring any additional certification.
(e) Transfers to Non-U.S. Persons at Any Time. The following provisions shall
apply with respect to any registration of any transfer of a Certificate to a Non-U.S. Person:
(i) Prior to the Offshore Certificates Exchange Date, the
Registrar shall register any proposed transfer of a Certificate to a
Non-U.S. Person upon receipt of a certificate substantially in the form
set forth as Exhibit C hereto from the proposed transferor.
(ii) On and after the Offshore Certificates Exchange Date, the
Registrar shall register any proposed transfer to any Non-U.S. Person
if the Certificate to be transferred is a U.S. Physical Certificate or
an interest in the U.S. Global Certificate, upon receipt of a
certificate substantially in the form of Exhibit C from the proposed
transferor. The Registrar shall promptly send a copy of such
certificate to the Company.
(iii) Upon receipt by the Registrar of (x) the documents, if
any, required by paragraph (ii) and (y) instructions in accordance with
the Depositary's and the Registrar's procedures, the Registrar shall
reflect on its books and records the date of such transfer and a
decrease in the principal amount of such U.S. Global Certificate in an
amount equal to the principal amount of the beneficial interest in such
U.S. Global Certificate to be transferred, and (B) upon receipt by the
Registrar of instructions given in accordance with the Depositary's and
the Registrar's procedures, the Registrar shall reflect on its books
and records the date and an increase in the principal amount of the
Offshore Global Certificate in an amount equal to the principal amount
of the U.S. Physical Certificate or the U.S. Global Certificate, as the
case may be, to be transferred, and the Trustee shall cancel the
Physical Certificate, if any, so transferred or decrease the amount of
such U.S. Global Certificate.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Certificates not bearing the Private Placement Legend, the
Registrar shall deliver Certificates that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Certificates bearing the
Private Placement Legend, the Registrar shall deliver only Certificates that
bear the Private Placement Legend unless either (i) the circumstances
contemplated by paragraph (a)(i)(x) or (e)(ii) of this Section 3.06 exist or
(ii) there is delivered to the Registrar an Opinion of Counsel to the effect
that neither such legend nor the related restrictions on transfer are required
in order to maintain compliance with the provisions of the Securities Act.
(g) General. By its acceptance of any Certificate bearing the
Private Placement Legend, each Holder of such a Certificate acknowledges the
restrictions on transfer of such Certificate set forth in this Agreement and
agrees that it will transfer such Certificate only as provided in this
Agreement. The Registrar shall not register a transfer of any Certificate unless
such transfer complies with the restrictions on transfer of such Certificate set
forth in this Agreement. In connection with any transfer of Certificates, each
Certificateholder agrees by its acceptance of the Certificates to furnish the
Registrar or the Trustee such certifications, legal opinions or other
information as either of them may reasonably require to confirm that such
transfer is being made pursuant to an exemption from, or a transaction not
subject to, the registration requirements of the Securities Act; provided that
neither the Trustee nor the Registrar shall be required to determine the
sufficiency of any such certifications, legal opinions or other information.
Until such time as no Certificates remain Outstanding, the
Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 3.05 or this Section 3.06. The
Trustee, if not the Registrar at such time, shall have the right to inspect and
make copies of all such letters, notices or other written communications at any
reasonable time upon the giving of reasonable written notice to the Registrar.
Section 3.07. Mutilated, Destroyed, Lost or Stolen
Certificates. If (a) any mutilated Certificate is surrendered to the Registrar
or the Registrar receives evidence to its satisfaction of the destruction, loss
or theft of any Certificate and (b) there is delivered to the Registrar and the
Trustee such security, indemnity or bond, as may be required by them to save
each of them harmless, then, in the absence of notice to the Registrar or the
Trustee that such Certificate has been acquired by a bona fide purchaser, the
Trustee shall execute, authenticate and deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Certificate, a new Certificate or
Certificates, in authorized denominations and of like Fractional Undivided
Interest and bearing a number not contemporaneously outstanding.
In connection with the issuance of any new Certificate under
this Section 3.07, the Trustee shall require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee
and the Registrar) connected therewith.
Any duplicate Certificate issued pursuant to this Section 3.07
shall constitute conclusive evidence of the appropriate Fractional Undivided
Interest in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Certificates.
Section 3.08. Persons Deemed Owners. Prior to due presentment
of a Certificate for registration of transfer, the Trustee, the Registrar and
any Paying Agent may treat the Person in whose name any Certificate is
registered as the owner of such Certificate for the purpose of receiving
distributions pursuant to Article IV and for all other purposes whatsoever, and
none of the Trustee, the Registrar or any Paying Agent shall be affected by any
notice to the contrary.
Section 3.09. Cancellation. All Certificates surrendered for
payment or transfer or exchange shall, if surrendered to the Trustee or any
agent of the Trustee other than the Registrar, be delivered to the Registrar for
cancellation and shall promptly be cancelled by it. No Certificates shall be
authenticated in lieu of or in exchange for any Certificates cancelled as
provided in this Section, except as expressly permitted by this Agreement. All
cancelled Certificates held by the Registrar shall be destroyed and a
certification of their destruction delivered to the Trustee.
Section 3.10. Limitation of Liability for Payments. All
payments and distributions made to Certificateholders shall be made only from
the Trust Property and only to the extent that the Trustee shall have sufficient
income or proceeds from the Trust Property to make such payments in accordance
with the terms of Article IV of this Agreement. Each Certificateholder, by its
acceptance of a Certificate, agrees that it will look solely to the income and
proceeds from the Trust Property to the extent available for distribution to
such Certificateholder as provided in this Agreement.
Section 3.11. Temporary Certificates. Until definitive
Certificates are ready for delivery, the Trustee shall authenticate temporary
Certificates. Temporary Certificates shall be substantially in the form of
definitive Certificates but may have insertions, substitutions, omissions and
other variations determined to be appropriate by the officers executing the
temporary Certificates, as evidenced by their execution of such temporary
Certificates. If temporary Certificates are issued, the Trustee will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Trustee designated for such purpose
pursuant to Section 7.12, without charge to the Certificateholder. Upon
surrender for cancellation of any one or more temporary Certificates, the
Trustee shall execute, authenticate and deliver in exchange therefor a like face
amount of definitive Certificates of authorized denominations. Until so
exchanged, the temporary Certificates shall be entitled to the same benefits
under this Agreement as definitive Certificates.
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
Section 4.01. Certificate Account and Special Payments
Account. (a) The Trustee shall establish and maintain on behalf of the
Certificateholders a Certificate Account as one or more non-interest-bearing
accounts. The Trustee shall hold the Certificate Account in trust for the
benefit of the Certificateholders, and shall make or permit withdrawals
therefrom only as provided in this Agreement. On each day when a Scheduled
Payment is made to the Trustee, the Trustee upon receipt thereof shall
immediately deposit the aggregate amount of such Scheduled Payment into the
Certificate Account.
(b) The Trustee shall establish and maintain on behalf of the
Certificateholders a Special Payments Account as one or more accounts, which
shall be non-interest bearing except as provided in Section 4.04. The Trustee
shall hold the Special Payments Account in trust for the benefit of the
Certificateholders and shall make or permit withdrawals therefrom only as
provided in this Agreement. On each day when one or more Special Payments are
made to the Trustee, the Trustee, upon receipt thereof, shall immediately
deposit the aggregate amount of such Special Payments into the Special Payments
Account.
(c) The Trustee shall present to the Loan Trustee to which an
Equipment Note relates such Equipment Note on the date of its stated final
maturity or, in the case of any Equipment Note which is to be redeemed in whole
pursuant to the relevant Indenture, on the applicable redemption date under such
Indenture.
Section 4.02. Distributions from Certificate Account and
Special Payments Account. (a) On each Regular Distribution Date or as soon
thereafter as the Trustee has confirmed receipt of the payment of the Scheduled
Payments due on such date, the Trustee shall distribute out of the Certificate
Account the entire amount deposited therein pursuant to Section 4.01(a). There
shall be so distributed to each Certificateholder of record on the Record Date
with respect to such Regular Distribution Date (other than as provided in
Section 11.01 concerning the final distribution) by check mailed to such
Certificateholder, at the address appearing in the Register, such
Certificateholder's pro rata share (based on the Fractional Undivided Interest
in the Trust held by such Certificateholder) of the total amount in the
Certificate Account, except that, with respect to Certificates registered on the
Record Date in the name of the nominee of the Depositary (initially, such
nominee to be Cede & Co.), such distribution shall be made by wire transfer in
immediately available funds to the account designated by such nominee.
(b) On each Special Distribution Date with respect to any
Special Payment or as soon thereafter as the Trustee has confirmed receipt of
any Special Payments, the Trustee shall distribute out of the Special Payments
Account the entire amount of such Special Payment deposited therein pursuant to
Section 4.01(b). There shall be so distributed to each Certificateholder of
record on the Record Date with respect to such Special Distribution Date (other
than as provided in Section 11.01 concerning the final distribution) by check
mailed to such Certificateholder, at the address appearing in the Register, such
Certificateholder's pro rata share (based on the aggregate Fractional Undivided
Interest in the Trust held by such Certificateholder) of the aggregate amount in
the Special Payments Account on account of such Special Payment, except that,
with respect to Certificates registered on the Record Date in the name of the
nominee of the Depositary (initially, such nominee to be Cede & Co.), such
distribution shall be made by wire transfer in immediately available funds to
the account designated by such nominee.
(c) The Trustee shall, at the expense of the Company, cause
notice of each Special Payment to be mailed to each Certificateholder at his
address as it appears in the Register. In the event of redemption, prepayment or
purchase of Equipment Notes held in the Trust, such notice shall be mailed not
less than 20 days prior to the date any Special Payment is scheduled to be
distributed. In the case of any other Special Payments, such notice shall be
mailed as soon as practicable after the Trustee has confirmed that it has
received funds for such Special Payment, stating the Special Distribution Date
for such Special Payment which shall occur not less than 20 days after the date
of such notice and as soon as practicable thereafter. Notices mailed by the
Trustee shall set forth:
(i) the Special Distribution Date and the Record Date therefor (except as
otherwise provided in Section 11.01),
(ii) the amount of the Special Payment for each $1,000 face
amount Certificate (taking into account any payment to be made by the
Company pursuant to Section 2.01(b)) and the amount thereof
constituting principal, premium, if any, and interest,
(iii) the reason for the Special Payment, and
(iv) if the Special Distribution Date is the same date as a
Regular Distribution Date, the total amount to be received on such date
for each $1,000 face amount Certificate.
If the amount of premium, if any, payable upon the redemption, prepayment or
purchase of an Equipment Note has not been calculated at the time that the
Trustee mails notice of a Special Payment, it shall be sufficient if the notice
sets forth the other amounts to be distributed and states that any premium
received will also be distributed.
If any redemption of the Equipment Notes held in the Trust is
cancelled, the Trustee, as soon as possible after learning thereof, shall cause
notice thereof to be mailed to each Certificateholder at its address as it
appears on the Register.
Section 4.03. Statements to Certificateholders. (a) On each
Distribution Date, the Trustee will include with each distribution to
Certificateholders of a Scheduled Payment or Special Payment, as the case may
be, a statement setting forth the following information (per $1,000 face amount
Certificate as to (i) and (ii) below):
(i) the amount of such distribution allocable to principal and the amount
allocable to premium, if any;
(ii) the amount of such distribution allocable to interest; and
(iii) the Pool Balance and the Pool Factor.
With respect to the Certificates registered in the name of a
Clearing Agency or its nominee, on the record date prior to each Distribution
Date, the Trustee will request from the Clearing Agency a securities position
listing setting forth the names of all the Clearing Agency Participants
reflected on the Clearing Agency's books as holding interests in the
Certificates on such record date. On each Distribution Date, the Trustee will
mail to each such Clearing Agency Participant the statement described above and
will make available additional copies as requested by such Clearing Agency
Participant for forwarding to holders of Certificates.
(b) Within a reasonable period of time after the end of each
calendar year but not later than the latest date permitted by law, the Trustee
shall furnish to each Person who at any time during such calendar year was a
Certificateholder of record a statement containing the sum of the amounts
determined pursuant to clauses (a)(i) and (a)(ii) with respect to the Trust for
such calendar year or, in the event such Person was a Certificateholder of
record during a portion of such calendar year, for the applicable portion of
such year, and such other items as are readily available to the Trustee and
which a Certificateholder shall reasonably request as necessary for the purpose
of such Certificateholder's preparation of its federal income tax returns. With
respect to Certificates registered in the name of a Clearing Agency or its
nominee, such report and such other items shall be prepared on the basis of
information supplied to the Trustee by the Clearing Agency Participants and
shall be delivered by the Trustee to such Clearing Agency Participants to be
available for forwarding by such Clearing Agency Participants.
Section 4.04. Investment of Special Payment Moneys. Any money
received by the Trustee pursuant to Section 4.01(b) representing a Special
Payment which is not to be promptly distributed shall, to the extent
practicable, be invested in Permitted Investments by the Trustee as directed in
writing by the Company pending distribution of such Special Payment pursuant to
Section 4.02. Any investment made pursuant to this Section 4.04 shall be in such
Permitted Investments having maturities not later than the date that such moneys
are required to be used to make the payment required under Section 4.02 on the
applicable Special Distribution Date and the Trustee shall hold any such
Permitted Investments until maturity. The Trustee shall have no liability with
respect to any investment made pursuant to this Section 4.04, other than by
reason of the willful misconduct or negligence of the Trustee. All income and
earnings from such investments shall be distributed on such Special Distribution
Date as part of such Special Payment.
ARTICLE V
THE COMPANY
Section 5.01. Maintenance of Corporate Existence. The Company,
at its own cost and expense, will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, rights and
franchises, except as otherwise specifically permitted in Section 5.02;
provided, however, that the Company shall not be required to preserve any right
or franchise if the Company shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company.
Section 5.02. Consolidation, Merger, Etc. The Company shall not consolidate with or
merge into any other corporation or convey, transfer or lease substantially all of its assets as an
entirety to any Person unless:
(a) the corporation formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of the Company as an
entirety shall be organized and validly existing under the laws of the
United States of America or any state thereof or the District of
Columbia and a "citizen of the United States" (as defined in Section
40102(a)(15) of Title 49 of the United States Code) holding an air
carrier operating certificate issued by the Federal Aviation
Administration, or any successor agency thereto (the "FAA"), pursuant
to Chapter 447 of Title 49, United States Code, authorizing the
operation in air transportation of aircraft capable of carrying 10 or
more individuals or 6,000 pounds or more of cargo pursuant to Part 121
of the FAA's regulations (14 CFR Part 121);
(b) the corporation formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance,
transfer or lease substantially all of the assets of the Company as an
entirety shall execute and deliver to the Trustee a duly authorized,
valid, binding and enforceable agreement in form and substance
reasonably satisfactory to the Trustee containing an assumption by such
successor corporation or Person of the due and punctual performance and
observance of each covenant and condition of this Agreement, the Other
Pass Through Trust Agreements, the Financing Agreements, and each other
Financing Document to be performed or observed by the Company;
(c) immediately after giving effect to such transaction, no
Event of Default or event which is, or after notice or passage of time,
or both, would be, such an Event of Default shall have occurred and be
continuing; and
(d) the Company shall have delivered to the Trustee an
Officer's Certificate of the Company and an Opinion of Counsel of the
Company reasonably satisfactory to the Trustee, each stating that such
consolidation, merger, conveyance, transfer or lease and the assumption
agreement mentioned in clause (b) above comply with this Section 5.02
and that all conditions precedent herein provided for relating to such
transaction have been complied with.
Upon any consolidation or merger, or any conveyance, transfer
or lease of substantially all of the assets of the Company as an entirety in
accordance with this Section 5.02, the successor corporation or Person formed by
such consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Agreement with
the same effect as if such successor corporation or Person had been named as the
Company herein. No such conveyance, transfer or lease of substantially all of
the assets of the Company as an entirety shall have the effect of releasing the
Company or any successor corporation or Person which shall theretofore have
become such in the manner prescribed in this Section 5.02 from its liability in
respect of this Agreement or any Financing Document to which it is a party.
ARTICLE VI
DEFAULT
Section 6.01. Events of Default. (a) Exercise of Remedies. Upon the occurrence and
during the continuation of any Indenture Default under any Indenture, the Trustee may, to the extent it
is the Controlling Party at such time, direct the exercise of remedies as provided in the Intercreditor
Agreement.
(b) Purchase Rights of Certificateholders. (i) By acceptance
of its Certificate, each Certificateholder agrees that at any time after the
occurrence and during the continuation of a Triggering Event: each Class B
Certificateholder shall have the right to purchase all, but not less than all,
of the Certificates upon ten days' written notice to the Trustee and each other
Class B Certificateholder, provided that (A) if prior to the end of such ten-day
period any other Class B Certificateholder notifies such purchasing Class B
Certificateholder that such other Class B Certificateholder wants to participate
in such purchase, then such other Class B Certificateholder may join with the
purchasing Class B Certificateholder to purchase all, but not less than all, of
the Certificates pro rata based on the Fractional Undivided Interest in the
Class B Trust held by each such Class B Certificateholder and (B) if prior to
the end of such ten-day period any other Class B Certificateholder fails to
notify the purchasing Class B Certificateholder of such other Class B
Certificateholder's desire to participate in such a purchase, then such other
Class B Certificateholder shall lose its right to purchase the Certificates
pursuant to this Section 6.01(b).
(ii) By acceptance of its Certificate, each Certificateholder
agrees that at any time after the occurrence and during the continuation of a
Triggering Event: each Class C Certificateholder shall have the right (which
shall not expire upon any purchase of the Certificates pursuant to clause (i)
above) to purchase all, but not less than all, of the Certificates and the Class
B Certificates upon ten days' written notice to the Trustee, the Class B Trustee
and each other Class C Certificateholder, provided that (A) if prior to the end
of such ten-day period any other Class C Certificateholder notifies such
purchasing Class C Certificateholder that such other Class C Certificateholder
wants to participate in such purchase, then such other Class C Certificateholder
may join with the purchasing Class C Certificateholder to purchase all, but not
less than all, of the Certificates and the Class B Certificates pro rata based
on the Fractional Undivided Interest in the Class C Trust held by each such
Class C Certificateholder and (B) if prior to the end of such ten day period any
other Class C Certificateholder fails to notify the purchasing Class C
Certificateholder of such other Class C Certificateholder's desire to
participate in such a purchase, then such other Class C Certificateholder shall
lose its right to purchase the Certificates and the Class B Certificates
pursuant to this Section 6.01(b).
(iii) By acceptance of its Certificate, each Certificateholder
agrees that at any time after the occurrence and during the continuation of a
Triggering Event: each Class D Certificateholder shall have the right (which
shall not expire upon any purchase of the Certificates pursuant to clause (i)
above and the Certificates and the Class B Certificates pursuant to clause (ii)
above) to purchase all, but not less than all, of the Certificates, the Class B
Certificates and the Class C Certificates upon ten days' written notice to the
Trustee, the Class B Trustee, the Class C Trustee and each other Class D
Certificateholder, provided that (A) if prior to the end of such ten-day period
any other Class D Certificateholder notifies such purchasing Class D
Certificateholder that such other Class D Certificateholder wants to participate
in such purchase, then such other Class D Certificateholder may join with the
purchasing Class D Certificateholder to purchase all, but not less than all, of
the Certificates, the Class B Certificates and the Class C Certificates pro rata
based on the Fractional Undivided Interest in the Class D Trust held by each
such Class D Certificateholder and (B) if prior to the end of such ten day
period any other Class D Certificateholder fails to notify the purchasing Class
D Certificateholder of such other Class D Certificateholder's desire to
participate in such a purchase, then such other Class D Certificateholder shall
lose its right to purchase the Certificates, the Class B Certificates and the
Class C Certificates pursuant to this Section 6.01(b).
The purchase price with respect to the Certificates shall be
equal to the Pool Balance of the Certificates, together with accrued and unpaid
interest thereon to the date of such purchase, without premium, but including
any other amounts then due and payable to the Certificateholders under this
Agreement, the Intercreditor Agreement or any other Financing Document or on or
in respect of the Certificates; provided, however, that no such purchase of
Certificates shall be effective unless the purchaser shall certify to the
Trustee that contemporaneously with such purchase, such purchaser is purchasing,
pursuant to the terms of this Agreement and the Other Pass Through Trust
Agreements, the Certificates, the Class B Certificates and the Class C
Certificates which are senior to the Class of Certificates (as defined in the
Intercreditor Agreement) held by such purchaser. Each payment of the purchase
price of the Certificates shall be made to an account or accounts designated by
the Trustee and each such purchase shall be subject to the terms of this
Section. Each Certificateholder agrees by its acceptance of its Certificate that
it will, subject to Section 3.04 hereof, upon payment from such Class B
Certificateholder(s), Class C Certificateholder(s) or Class D
Certificateholder(s) of the purchase price set forth in the first sentence of
this paragraph, forthwith sell, assign, transfer and convey to the purchaser
thereof (without recourse, representation or warranty of any kind except for its
own acts), all of the right, title, interest and obligation of such
Certificateholder in, this Agreement, the Intercreditor Agreement, the Liquidity
Facility, the Financing Documents and all Certificates held by such
Certificateholder (excluding all right, title and interest under any of the
foregoing to the extent such right, title or interest is with respect to an
obligation not then due and payable as respects any action or inaction or state
of affairs occurring prior to such sale) and the purchaser shall assume all of
such Certificateholder's obligations under this Agreement, the Intercreditor
Agreement, the Liquidity Facility and the Financing Documents. The Certificates
will be deemed to be purchased on the date payment of the purchase price is made
notwithstanding the failure of the Certificateholders to deliver any
Certificates (whether in the form of Physical Certificates or beneficial
interests in Global Certificates) and, upon such a purchase, (i) the only rights
of the Certificateholders will be to deliver the Certificates to the purchaser
and receive the purchase price for the Certificates and (ii) if the purchaser
shall so request, such Certificateholder will comply with all the provisions of
Section 3.04 hereof to enable new Certificates to be issued to the purchaser in
such denominations as it shall request. All charges and expenses in connection
with the issuance of any such new Certificates shall be borne by the purchaser
thereof.
As used in this Section 6.01(b), the terms
"Certificateholder", "Class", "Class B Certificate", "Class B
Certificateholder", "Class B Trust", "Class B Trustee", "Class C Certificate",
"Class C Certificateholder", "Class C Trust", "Class C Trustee", "Class D
Certificate", "Class D Certificateholder", "Class D Trust" and "Class D
Trustee", shall have the respective meanings assigned to such terms in the
Intercreditor Agreement.
Section 6.02. Incidents of Sale of Equipment Notes. Upon any
sale of all or any part of the Equipment Notes made either under the power of
sale given under this Agreement or otherwise for the enforcement of this
Agreement, the following shall be applicable:
(1) Certificateholders and Trustee May Purchase Equipment
Notes. Any Certificateholder, the Trustee in its individual or any
other capacity or any other Person may bid for and purchase any of the
Equipment Notes, and upon compliance with the terms of sale, may hold,
retain, possess and dispose of such Equipment Notes in their own
absolute right without further accountability.
(2) Receipt of Trustee Shall Discharge Purchaser. The receipt
of the Trustee or of the officer making such sale shall be a sufficient
discharge to any purchaser for his purchase money, and, after paying
such purchase money and receiving such receipt, such purchaser or its
personal representative or assigns shall not be obliged to see to the
application of such purchase money, or be in any way answerable for any
loss, misapplication or non-application thereof.
(3) Application of Moneys Received upon Sale. Any moneys
received by the Trustee from the Subordination Agent pursuant to the
Intercreditor Agreement upon any sale made either under the power of
sale given by this Agreement or otherwise for the enforcement of this
Agreement shall be applied as provided in Section 4.02.
Section 6.03. Judicial Proceedings Instituted by Trustee;
Trustee May Bring Suit. If there shall be a failure to make payment of the
principal of, premium, if any, or interest on any Equipment Note, or if there
shall be any failure to pay Rent (as defined in the relevant Lease) under any
Lease when due and payable, then the Trustee, in its own name and as trustee of
an express trust, as holder of such Equipment Notes, to the extent permitted by
and in accordance with the terms of the Intercreditor Agreement and the
Financing Documents (subject to the rights of the applicable Owner Trustee or
Owner Participant to cure any such failure in accordance with Section 8.03 of
the applicable Indenture), shall be entitled and empowered to institute any
suits, actions or proceedings at law, in equity or otherwise, for the collection
of the sums so due and unpaid on such Equipment Notes or under such Lease and
may prosecute any such claim or proceeding to judgment or final decree with
respect to the whole amount of any such sums so due and unpaid.
Section 6.04. Control by Certificateholders. Subject to
Section 6.03 and the Intercreditor Agreement, the Certificateholders holding
Certificates evidencing Fractional Undivided Interests aggregating not less than
a majority in interest in the Trust shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee with respect to the Trust or pursuant to the terms of the Intercreditor
Agreement, or exercising any trust or power conferred on the Trustee under this
Agreement or the Intercreditor Agreement, including any right of the Trustee as
Controlling Party under the Intercreditor Agreement or as holder of the
Equipment Notes, provided that
(1) such Direction shall not be in conflict with any rule of
law or with this Agreement and would not involve the Trustee in
personal liability or expense,
(2) the Trustee shall not determine that the action so
directed would be unjustly prejudicial to the Certificateholders not
taking part in such Direction, and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such Direction.
Section 6.05. Waiver of Past Defaults. Subject to the
Intercreditor Agreement, the Certificateholders holding Certificates evidencing
Fractional Undivided Interests aggregating not less than a majority in interest
in the Trust (i) may on behalf of all of the Certificateholders waive any past
Event of Default hereunder and its consequences or (ii) if the Trustee is the
Controlling Party, may direct the Trustee to instruct the applicable Loan
Trustee to waive, any past Indenture Default under any Indenture and its
consequences, and thereby annul any Direction given by such Certificateholders
or the Trustee to such Loan Trustee with respect thereto, except a default:
(1) in the deposit of any Scheduled Payment or Special Payment
under Section 4.01 or in the distribution of any payment under Section
4.02 on the Certificates, or
(2) in the payment of the principal of (premium, if any) or interest on the
Equipment Notes, or
(3) in respect of a covenant or provision hereof which under
Article IX or X cannot be modified or amended without the consent of
each Certificateholder holding an Outstanding Certificate affected
thereby.
Upon any such waiver, such default shall cease to exist with
respect to the Certificates and any Event of Default arising therefrom shall be
deemed to have been cured for every purpose and any direction given by the
Trustee on behalf of the Certificateholders to the relevant Loan Trustee shall
be annulled with respect thereto; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon. Upon any such waiver, the Trustee shall vote the Equipment Notes issued
under the relevant Indenture to waive the corresponding Indenture Default.
Section 6.06. Right of Certificateholders to Receive Payments
Not to Be Impaired. Anything in this Agreement to the contrary notwithstanding,
including, without limitation, Section 6.07 hereof, but subject to the
Intercreditor Agreement, the right of any Certificateholder to receive
distributions of payments required pursuant to Section 4.02 hereof on the
Certificates when due, or to institute suit for the enforcement of any such
payment on or after the applicable Regular Distribution Date or Special
Distribution Date, shall not be impaired or affected without the consent of such
Certificateholder.
Section 6.07. Certificateholders May Not Bring Suit Except
Under Certain Conditions. A Certificateholder shall not have the right to
institute any suit, action or proceeding at law or in equity or otherwise with
respect to this Agreement, for the appointment of a receiver or for the
enforcement of any other remedy under this Agreement, unless:
(1) such Certificateholder previously shall have given written
notice to the Trustee of a continuing Event of Default;
(2) Certificateholders holding Certificates evidencing
Fractional Undivided Interests aggregating not less than 25% of the
Trust shall have requested the Trustee in writing to institute such
action, suit or proceeding and shall have offered to the Trustee
indemnity as provided in Section 7.03(e);
(3) the Trustee shall have refused or neglected to institute
such an action, suit or proceeding for 60 days after receipt of such
notice, request and offer of indemnity; and
(4) no direction inconsistent with such written request shall
have been given to the Trustee during such 60-day period by
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the
Trust.
It is understood and intended that no one or more of the
Certificateholders shall have any right in any manner whatsoever hereunder or
under the Certificates to (i) surrender, impair, waive, affect, disturb or
prejudice any property in the Trust Property or the lien of any Indenture on any
property subject thereto, or the rights of the Certificateholders or the holders
of the Equipment Notes, (ii) obtain or seek to obtain priority over or
preference with respect to any other such Certificateholder or (iii) enforce any
right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all the Certificateholders subject to the
provisions of this Agreement.
Section 6.08. Remedies Cumulative. Every remedy given
hereunder to the Trustee or to any of the Certificateholders shall not be
exclusive of any other remedy or remedies, and every such remedy shall be
cumulative and in addition to every other remedy given hereunder or now or
hereafter given by statute, law, equity or otherwise.
Section 6.09. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Agreement, or in any suit against
the Trustee for any action taken, suffered or omitted by it as Trustee, a court
may require any party litigant in such suit to file an undertaking to pay the
costs of such suit, and may assess costs against any such party litigant, in the
manner and to the extent provided in the Trust Indenture Act; provided that
neither this Section nor the Trust Indenture Act shall be deemed to authorize
any court to require such an undertaking or to make such an assessment in any
suit instituted by the Company or the Guarantor.
ARTICLE VII
THE TRUSTEE
Section 7.01. Certain Duties and Responsibilities. (a) Except
during the continuance of an Event of Default, the Trustee undertakes to perform
such duties as are specifically set forth in this Agreement, and no implied
covenants or obligations shall be read into this Agreement against the Trustee.
(b) In case an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Agreement, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of its own affairs.
(c) No provision of this Agreement shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of Subsection (a)
of this Section; and
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Trustee, unless it
shall be proved that the Trustee was negligent in ascertaining the
pertinent facts.
(d) Whether or not herein expressly so provided, every
provision of this Trust Agreement relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be subject to the
provisions of this Section.
Section 7.02. Notice of Defaults. As promptly as practicable
after, and in any event within 90 days after, the occurrence of any default (as
such term is defined below) hereunder known to the Trustee, the Trustee shall
transmit by mail to the Company, the Owner Trustees, the Owner Participants, the
Loan Trustees and the Certificateholders in accordance with Section 313(c) of
the Trust Indenture Act, notice of such default hereunder known to the Trustee,
unless such default shall have been cured or waived; provided, however, that,
except in the case of a default in the payment of the principal, premium, if
any, or interest on any Equipment Note, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Trustee in good faith determine that the withholding of such notice is in the
interests of the Certificateholders. For the purpose of this Section, the term
"default" means any event that is, or after notice or lapse of time or both
would become, an Event of Default.
Section 7.03. Certain Rights of Trustee. Subject to the provisions of Section 315 of
the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting in reliance upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture or other paper or document believed by
it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request or direction of the Company mentioned herein shall be sufficiently
evidenced by a Request;
(c) whenever in the administration of this Agreement or the
Intercreditor Agreement the Trustee shall deem it desirable that a
matter be proved or established prior to taking, suffering or omitting
any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officer's Certificate of the Company, any Owner Trustee or
any Loan Trustee;
(d) the Trustee may consult with counsel and the advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Agreement or the
Intercreditor Agreement at the request or direction of any of the
Certificateholders pursuant to this Agreement or the Intercreditor
Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the cost, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture or other paper or document;
(g) the Trustee may execute any of the trusts or powers under
this Agreement or the Intercreditor Agreement or perform any duties
under this Agreement or the Intercreditor Agreement either directly or
by or through agents or attorneys, and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney appointed with due care by it under this Agreement or the
Intercreditor Agreement;
(h) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Certificateholders holding Certificates evidencing
Fractional Undivided Interests aggregating not less than a majority in
interest in the Trust relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Agreement or the Intercreditor Agreement; and
(i) the Trustee shall not be required to expend or risk its
own funds in the performance of any of its duties under this Agreement,
or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk is not reasonably assured to it.
Section 7.04. Not Responsible for Recitals or Issuance of
Certificates. The recitals contained herein and in the Certificates, except the
certificates of authentication, shall not be taken as the statements of the
Trustee, and the Trustee assumes no responsibility for their correctness.
Subject to Section 7.15, the Trustee makes no representations as to the validity
or sufficiency of this Agreement, any Financing Agreement, any Equipment Notes,
the Certificates or any other Financing Document, except that the Trustee hereby
represents and warrants that this Agreement has been, and the Intercreditor
Agreement, each Financing Agreement and each Certificate will be, executed,
authenticated and delivered by one of its officers who is duly authorized to
execute, authenticate and deliver such document on its behalf.
Section 7.05. May Hold Certificates. The Trustee, any Paying
Agent, Registrar or any of their Affiliates or any other agent in their
respective individual or any other capacity may become the owner or pledgee of
Certificates and, subject to Sections 310(b) and 311 of the Trust Indenture Act,
if applicable, may otherwise deal with the Company, the Guarantor, the Owner
Trustees or the Loan Trustees with the same rights it would have if it were not
Trustee, Paying Agent, Registrar or such other agent.
Section 7.06. Money Held in Trust. Money held by the Trustee
or the Paying Agent in trust hereunder need not be segregated from other funds
except to the extent required herein or by law and neither the Trustee nor the
Paying Agent shall have any liability for interest upon any such moneys except
as provided for herein.
Section 7.07. Compensation and Reimbursement. The Company agrees:
(1) to pay, or cause to be paid, to the Trustee from time to
time compensation (as set out in a separate fee agreement between the
Trustee and the Company) for all services rendered by it hereunder
(which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse, or cause to be reimbursed, the Trustee upon its request for
all reasonable out-of-pocket expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of
this Agreement or the Intercreditor Agreement (including the reasonable
compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence, willful misconduct or bad faith or as
may be incurred due to the Trustee's breach of its representations and
warranties set forth in Section 7.15;
(3) to indemnify, or cause to be indemnified, the Trustee for,
and to hold it harmless against, any loss, liability or expense (other
than for or with respect to any tax) incurred without negligence,
willful misconduct or bad faith, on its part, arising out of or in
connection with the acceptance or administration of this Trust,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except for any such loss, liability or
expense incurred by reason of the Trustee's breach of its
representations and warranties set forth in Section 7.15. The Trustee
shall notify the Company and the Guarantor promptly of any claim for
which it may seek indemnity. The Company and/or the Guarantor shall
defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel with the consent of the Company and
the Guarantor and the Company and the Guarantor will pay the reasonable
fees and expenses of such counsel. Neither the Company nor the
Guarantor need pay for any settlement made without its consent; and
(4) to indemnify, or cause to be indemnified, the Trustee,
solely in its individual capacity, for, and to hold it harmless
against, any tax (except to the extent the Trustee is reimbursed
therefor pursuant to the next paragraph, provided that no
indemnification shall be available with respect to any tax attributable
to the Trustee's compensation for serving as such) incurred without
negligence, willful misconduct or bad faith, on its part, arising out
of or in connection with the acceptance or administration of this
Trust, including any costs and expenses incurred in contesting the
imposition of any such tax. The Trustee, in its individual capacity,
shall notify the Company and the Guarantor promptly of any claim for
any tax for which it may seek indemnity. The Trustee shall permit the
Company and the Guarantor to contest the imposition of such tax and the
Trustee, in its individual capacity, shall cooperate in the defense.
The Trustee, in its individual capacity, may have separate counsel with
the consent of the Company and the Guarantor and the Company and the
Guarantor will pay the reasonable fees and expenses of such counsel.
Neither the Company nor the Guarantor need pay for any taxes paid, in
settlement or otherwise, without its consent.
The Trustee shall be entitled to reimbursement from, and shall
have a lien prior to the Certificates upon, the Trust Property for any tax
incurred without negligence, bad faith or willful misconduct, on its part,
arising out of or in connection with the acceptance or administration of such
Trust (other than any tax attributable to the Trustee's compensation for serving
as such), including any costs and expenses incurred in contesting the imposition
of any such tax. If the Trustee reimburses itself from the Trust Property of
such Trust for any such tax, it will mail a brief report within 30 days setting
forth the circumstances thereof to all Certificateholders as their names and
addresses appear in the Register.
Section 7.08. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder which shall be eligible to act as a
trustee under Section 310(a) of the Trust Indenture Act and shall have a
combined capital and surplus of at least $75,000,000 (or a combined capital and
surplus in excess of $5,000,000 and the obligations of which, whether now in
existence or hereafter incurred, are fully and unconditionally guaranteed by a
corporation organized and doing business under the laws of the United States,
any state or territory thereof or of the District of Columbia and having a
combined capital and surplus of at least $75,000,000). If such corporation
publishes reports of conditions at least annually, pursuant to law or to the
requirements of federal, state, territorial or District of Columbia supervising
or examining authority, then for the purposes of this Section 7.08, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of conditions so
published.
In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 7.08 to act as Trustee, the
Trustee shall resign immediately as Trustee in the manner and with the effect
specified in Section 7.09.
Section 7.09. Resignation and Removal; Appointment of
Successor. (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 7.10.
(b) The Trustee may resign at any time as trustee by giving
prior written notice thereof to the Company, the Authorized Agents, the Owner
Trustees and the Loan Trustees. If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Company, the Authorized Agents, the
Owner Trustees, the Loan Trustees and the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust
delivered to the Trustee, the Company, the Owner Trustees and the Loan Trustees.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 310 of the
Trust Indenture Act, if applicable, after written request therefor by
the Company or by any Certificateholder who has been a bona fide
Certificateholder for at least six months; or
(2) the Trustee shall cease to be eligible under Section 7.08
and shall fail to resign after written request therefor by the Company
or by any such Certificateholder; or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any case, (i) the Company may remove the Trustee or (ii) any
Certificateholder who has been a bona fide Certificateholder for at least six
months may, on behalf of itself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
(e) If a Responsible Officer of the Trustee shall obtain
actual knowledge of an Avoidable Tax which has been or is likely to be asserted,
the Trustee shall promptly notify the Company and shall, within 30 days of such
notification, resign hereunder unless within such 30-day period the Trustee
shall have received notice that the Company has agreed to pay such tax. The
Company shall promptly appoint a successor Trustee in a jurisdiction where there
are no Avoidable Taxes.
(f) If the Trustee shall resign, be removed or become
incapable of acting as trustee or if a vacancy shall occur in the office of the
Trustee for any cause, the Company shall promptly appoint a successor Trustee.
If, within 90 days after such resignation, removal or incapability, or other
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Certificateholders holding Certificates evidencing Fractional Undivided
Interests aggregating not less than a majority in interest in the Trust
delivered to the Company, the Owner Trustees, the Loan Trustees and the retiring
Trustee, and the Company approves such appointment, which approval shall not be
unreasonably withheld, then the successor Trustee so appointed shall, forthwith
upon its acceptance of such appointment, become the successor Trustee and
supersede the successor Trustee appointed as provided above. If no successor
Trustee shall have been so appointed as provided above and accepted appointment
in the manner hereinafter provided, any Certificateholder who has been a bona
fide Certificateholder for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(g) The successor Trustee shall give notice of the resignation
and removal of the Trustee and appointment of the successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Certificateholders as their names and addresses appear in the Register. Each
notice shall include the name of such successor Trustee and the address of its
Corporate Trust Office.
Section 7.10. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute and deliver to the Company,
the Authorized Agents, the Owner Trustees and the Loan Trustees and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on request of the Company or the successor Trustee, such retiring Trustee
shall execute and deliver an instrument transferring to such successor Trustee
all such rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all Trust Property held
by such retiring Trustee hereunder, subject nevertheless to its lien, if any,
provided for in Section 7.07. Upon request of any such successor Trustee, the
Company, the retiring Trustee and such successor Trustee shall execute and
deliver any and all instruments containing such provisions as shall be necessary
or desirable to transfer and confirm to, and for more fully and certainly
vesting in, such successor Trustee all such rights, powers and trusts.
No institution shall accept its appointment as a Trustee
hereunder unless at the time of such acceptance such institution shall be
qualified and eligible under this Article VII.
Section 7.11. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Certificates shall have been
executed or authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such execution or authentication and deliver the Certificates so
executed or authenticated with the same effect as if such successor Trustee had
itself executed or authenticated such Certificates.
Section 7.12. Maintenance of Agencies. (a) There shall at all
times be maintained an office or agency where Certificates may be presented or
surrendered for registration of transfer or for exchange, and for payment
thereof and where notices and demands to or upon the Trustee in respect of such
Certificates may be served. Presentations and demands may be made and notices
may be served at the Corporate Trust Office of the Trustee.
(b) There shall at all times be a Registrar and a Paying Agent
hereunder with respect to the Certificates. Each such Authorized Agent shall be
a bank or trust company, shall be a corporation organized and doing business
under the laws of the United States or any state, with a combined capital and
surplus of at least $75,000,000, or a corporation having a combined capital and
surplus in excess of $5,000,000, the obligations of which are guaranteed by a
corporation organized and doing business under the laws of the United States or
any state, with a combined capital and surplus of at least $75,000,000, and
shall be authorized under such laws to exercise corporate trust powers, subject
to supervision by federal or state authorities. The Trustee shall initially be
the Paying Agent and, as provided in Section 3.04, Registrar hereunder with
respect to the Certificates. Each Registrar shall furnish to the Trustee, at
stated intervals of not more than six months, and at such other times as the
Trustee may request in writing, a copy of the Register maintained by such
Registrar.
(c) Any corporation into which any Authorized Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, consolidation or conversion to which any Authorized
Agent shall be a party, or any corporation succeeding to the corporate trust
business of any Authorized Agent, shall be the successor of such Authorized
Agent hereunder, if such successor corporation is otherwise eligible under this
Section, without the execution or filing of any paper or any further act on the
part of the parties hereto or such Authorized Agent or such successor
corporation.
(d) Any Authorized Agent may at any time resign by giving
written notice of resignation to the Trustee, the Company, the Owner Trustees
and the Loan Trustees. The Company may, and at the request of the Trustee shall,
at any time terminate the agency of any Authorized Agent by giving written
notice of termination to such Authorized Agent and to the Trustee. Upon the
resignation or termination of an Authorized Agent or in case at any time any
such Authorized Agent shall cease to be eligible under this Section (when, in
either case, no other Authorized Agent performing the functions of such
Authorized Agent shall have been appointed), the Company shall promptly appoint
one or more qualified successor Authorized Agents, reasonably satisfactory to
the Trustee, to perform the functions of the Authorized Agent which has resigned
or whose agency has been terminated or who shall have ceased to be eligible
under this Section. The Company shall give written notice of any such
appointment made by it to the Trustee, the Owner Trustees and the Loan Trustees;
and in each case the Trustee shall mail notice of such appointment to all
Certificateholders as their names and addresses appear on the Register.
(e) The Company agrees to pay, or cause to be paid, from time
to time to each Authorized Agent reasonable compensation for its services and to
reimburse it for its reasonable expenses.
Section 7.13. Money for Certificate Payments to Be Held in
Trust. All moneys deposited with any Paying Agent for the purpose of any payment
on Certificates shall be deposited and held in trust for the benefit of the
Certificateholders entitled to such payment, subject to the provisions of this
Section. Moneys so deposited and held in trust shall constitute a separate trust
fund for the benefit of the Certificateholders with respect to which such money
was deposited.
The Trustee may at any time, for the purpose of obtaining the
satisfaction and discharge of this Agreement or for any other purpose, direct
any Paying Agent to pay to the Trustee all sums held in trust by such Paying
Agent, such sums to be held by the Trustee upon the same trusts as those upon
which such sums were held by such Paying Agent; and, upon such payment by any
Paying Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Section 7.14. Registration of Equipment Notes in Name of
Subordination Agent. The Trustee agrees that all Equipment Notes to be purchased
by the Trust shall be issued in the name of the Subordination Agent or its
nominee and held by the Subordination Agent in trust for the benefit of the
Certificateholders, or, if not so held, the Subordination Agent or its nominee
shall be reflected as the owner of such Equipment Notes in the register of the
issuer of such Equipment Notes.
Section 7.15. Representations and Warranties of Trustee. The Trustee hereby
represents and warrants that:
(a) the Trustee is a national banking association organized
and validly existing in good standing under the laws of the United
States of America;
(b) the Trustee has full power, authority and legal right to
execute, deliver, and perform this Agreement, the Intercreditor
Agreement and the Financing Agreements and has taken all necessary
action to authorize the execution, delivery, and performance by it of
this Agreement, the Intercreditor Agreement and the Financing
Agreements;
(c) the execution, delivery and performance by the Trustee of
this Agreement, the Intercreditor Agreement and the Financing
Agreements (i) will not violate any provision of United States federal
law or the law of the state of the United States where it is located
governing the banking and trust powers of the Trustee or any order,
writ, judgment, or decree of any court, arbitrator or governmental
authority applicable to the Trustee or any of its assets, (ii) will not
violate any provision of the articles of association or by-laws of the
Trustee, or (iii) will not violate any provision of, or constitute,
with or without notice or lapse of time, a default under, or result in
the creation or imposition of any lien on any properties included in
the Trust Property pursuant to the provisions of any mortgage,
indenture, contract, agreement or other undertaking to which it is a
party, which violation, default or lien could reasonably be expected to
have an adverse effect on the Trustee's performance or ability to
perform its duties hereunder or thereunder or on the transactions
contemplated herein or therein;
(d) the execution, delivery and performance by the Trustee of
this Agreement, the Intercreditor Agreement and the Financing
Agreements will not require the authorization, consent, or approval of,
the giving of notice to, the filing or registration with, or the taking
of any other action in respect of, any governmental authority or agency
of the United States or the State of the United States where it is
located regulating the banking and corporate trust activities of the
Trustee; and
(e) this Agreement, the Intercreditor Agreement and the
Financing Agreements have been duly executed and delivered by the
Trustee and constitute the legal, valid, and binding agreements of the
Trustee, enforceable against it in accordance with their respective
terms, provided that enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and (ii) general principles
of equity.
Section 7.16. Withholding Taxes; Information Reporting. (a)
The Trustee, as trustee of the grantor trust created by this Agreement, shall
exclude and withhold from each distribution of principal, premium, if any, and
interest and other amounts due under this Agreement or under the Certificates
any and all withholding taxes applicable thereto as required by law. The Trustee
agrees to act as such withholding agent and, in connection therewith, whenever
any present or future taxes or similar charges are required to be withheld with
respect to any amounts payable in respect of the Certificates, to withhold such
amounts and timely pay the same to the appropriate authority in the name of and
on behalf of the Certificateholders, that it will file any necessary withholding
tax returns or statements when due, and that, as promptly as possible after the
payment thereof, it will deliver to each such Certificateholder appropriate
documentation showing the payment thereof, together with such additional
documentary evidence as such Certificateholders may reasonably request from time
to time. The Trustee agrees to file any other information reports as it may be
required to file under United States law.
(b) The Trustee may satisfy certain of its obligations with
respect to this Agreement by retaining, at the expense of the Company, a firm of
independent public accountants (the "Accountants") which shall (i) be
responsible for all tax filing requirements and (ii) perform the obligations of
the Trustee in respect of tax filing requirements. The Trustee shall be deemed
to have discharged its tax filing obligations under this Agreement upon its
retention of the Accountants, and, if the Trustee shall have selected in the
Accountants in good faith and without gross negligence, the Trustee shall not
have any liability with respect to the default or misconduct of the Accountants.
(c) The Trustee, at the request of the Company, will make such
United States federal income tax elections as may be necessary to prevent the
Trust from being classified for federal income tax purposes as an association
taxable as a corporation.
Section 7.17. Trustee's Liens. The Trustee in its individual
capacity agrees that it will at its own cost and expense promptly take any
action as may be necessary to duly discharge and satisfy in full any mortgage,
pledge, lien, charge, encumbrance, security interest or claim ("Trustee's
Liens") on or with respect to the Trust Property which is attributable to the
Trustee either (i) in its individual capacity and which is unrelated to the
transactions contemplated by this Agreement, the Intercreditor Agreement, the
Financing Agreements or the Financing Documents, or (ii) as Trustee hereunder or
in its individual capacity and which arises out of acts or omissions which are
not contemplated by this Agreement.
Section 7.18. Preferential Collection of Claims. The Trustee
shall comply with Section 311(a) of the Trust Indenture Act, excluding any
creditor relationship listed in Section 311(b) of the Trust Indenture Act. If
the Trustee shall resign or be removed as Trustee, it shall be subject to
Section 311(a) of the Trust Indenture Act to the extent provided therein.
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE
Section 8.01. The Company to Furnish Trustee with Names and
Addresses of Certificateholders. The Company will furnish or cause to be
furnished to the Trustee within 15 days after each Record Date with respect to a
Scheduled Payment, and at such other times as the Trustee may request in writing
within 30 days after receipt by the Company of any such request, a list, in such
form as the Trustee may reasonably require, of all information in the possession
or control of the Company as to the names and addresses of the
Certificateholders, in each case as of a date not more than 15 days prior to the
time such list is furnished; provided, however, that so long as the Trustee is
the sole Registrar, no such list need be furnished; and provided further,
however, that no such list need be furnished for so long as a copy of the
Register is being furnished to the Trustee pursuant to Section 7.12.
Section 8.02. Preservation of Information; Communications to
Certificateholders. The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Certificateholders contained
in the most recent list furnished to the Trustee as provided in Section 7.12 or
Section 8.01, as the case may be, and the names and addresses of
Certificateholders received by the Trustee in its capacity as Registrar, if so
acting. The Trustee may destroy any list furnished to it as provided in Section
7.12 or Section 8.01, as the case may be, upon receipt of a new list so
furnished.
Section 8.03. Reports by Trustee. Within 60 days after May 15
of each year commencing with the first full year following the issuance of the
Certificates, the Trustee shall transmit to the Certificateholders, as provided
in Section 313(c) of the Trust Indenture Act, a brief report dated as of such
May 15, if required by Section 313(a) of the Trust Indenture Act.
Section 8.04. Reports by the Guarantor and the Company. The Guarantor and the
Company shall:
(a) file with the Trustee, within 30 days after the Guarantor
or the Company is required to file the same with the SEC, copies of the
annual reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as the SEC may from
time to time by rules and regulations prescribe) which the Guarantor or
the Company is required to file with the SEC pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934, as amended; or,
if the Guarantor or the Company is not required to file information,
documents or reports pursuant to either of such sections, then to file
with the Trustee and the SEC, in accordance with rules and regulations
prescribed by the SEC, such of the supplementary and periodic
information, documents and reports which may be required pursuant to
section 13 of the Securities Exchange Act of 1934, as amended, in
respect of a security listed and registered on a national securities
exchange as may be prescribed in such rules and regulations;
(b) file with the Trustee and the SEC, in accordance with the
rules and regulations prescribed by the SEC, such additional
information, documents and reports with respect to compliance by the
Guarantor and the Company with the conditions and covenants of the
Guarantor and the Company provided for in this Agreement, as may be
required by such rules and regulations, including, in the case of
annual reports, if required by such rules and regulations, certificates
or opinions of independent public accountants;
(c) transmit to all Certificateholders, in the manner and to
the extent provided in Section 313(c) of the Trust Indenture Act such
summaries of any information, documents and reports required to be
filed by the Guarantor and the Company pursuant to subsections (a) and
(b) of this Section 8.04 as may be required by rules and regulations
prescribed by the SEC;
(d) furnish to the Trustee, not less often than annually, a
brief certificate from the principal executive officer, principal
financial officer or principal accounting officer as to his or her
knowledge of the Guarantor's and the Company's compliance with all
conditions and covenants under this Agreement (it being understood that
for purposes of this paragraph (d), such compliance shall be determined
without regard to any period of grace or requirement of notice provided
under this Agreement); and
(e) make available to any Certificateholder, upon request, the
annual audited and quarterly unaudited financial statements of the
Guarantor which are provided to the Trustee.
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
Section 9.01. Supplemental Agreements Without Consent of
Certificateholders. Without the consent of the Certificateholders, the Guarantor
and the Company may and the Trustee (subject to Section 9.03) shall, at any time
and from time to time, enter into one or more agreements supplemental hereto or,
if applicable, to the Intercreditor Agreement or the Liquidity Facility in form
and substance satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another corporation to the
Company or the Guarantor and the assumption by any such successor of
the covenants of the Company or the Guarantor herein contained; or
(2) to add to the covenants of the Company or the Guarantor
for the benefit of the Certificateholders, or to surrender any right or
power in this Agreement conferred upon the Company or the Guarantor; or
(3) to correct or supplement any provision in this Agreement,
the Intercreditor Agreement or the Liquidity Facility which may be
defective or inconsistent with any other provision herein or to make
any other provisions with respect to matters or questions arising under
this Agreement, the Intercreditor Agreement or the Liquidity Facility,
provided that any such action shall not adversely affect the interests
of the Certificateholders; or to cure any ambiguity or correct any
mistake; or
(4) to modify, eliminate or add to the provisions of this
Agreement to such extent as shall be necessary to continue the
qualification of this Agreement (including any supplemental agreement)
under the Trust Indenture Act or under any similar Federal statute
hereafter enacted, and to add to this Agreement such other provisions
as may be expressly permitted by the Trust Indenture Act, excluding,
however, the provisions referred to in Section 316(a)(2) of the Trust
Indenture Act as in effect at the date as of which this instrument was
executed or any corresponding provision in any similar Federal statute
hereafter enacted; or
(5) to evidence and provide for the acceptance of appointment
under this Agreement by the Trustee of a successor Trustee and to add
to or change any of the provisions of this Agreement as shall be
necessary to provide for or facilitate the administration of the Trust,
pursuant to the requirements of Section 7.10;
provided that no such action described in this Section 9.01 shall materially
adversely affect the interests of the Certificateholders.
Section 9.02. Supplemental Agreements with Consent of
Certificateholders. With the consent of the Certificateholders holding
Certificates evidencing Fractional Undivided Interests aggregating not less than
a majority in interest in the Trust, by Act of said Certificateholders delivered
to the Guarantor, the Company and the Trustee, the Guarantor and the Company may
(with the consent of the Owner Trustees, if any, which consent shall not be
unreasonably withheld), and the Trustee (subject to Section 9.03) shall, enter
into an agreement or agreements supplemental hereto for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of this Agreement, the Intercreditor Agreement, the Liquidity Facility or any
Financing Agreement to the extent applicable to such Certificateholders or of
modifying in any manner the rights and obligations of such Certificateholders
under this Agreement, the Intercreditor Agreement, the Liquidity Facility or any
Financing Agreement; provided, however, that no such supplemental agreement
shall, without the consent of the Certificateholder of each Outstanding
Certificate affected thereby:
(1) reduce in any manner the amount of, or delay the timing
of, any receipt by the Trustee of payments on the Equipment Notes held
in the Trust or distributions that are required to be made herein on
any Certificate, or change any date of payment of any Certificate, or
change the place of payment where, or the coin or currency in which,
any Certificate is payable, or impair the right to institute suit for
the enforcement of any such payment or distribution on or after the
Regular Distribution Date or Special Distribution Date applicable
thereto; or
(2) permit the disposition of any Equipment Note included in
the Trust Property except as permitted by this Agreement, or otherwise
deprive such Certificateholder of the benefit of the ownership of the
Equipment Notes in the Trust; or
(3) alter the priority of distributions specified in the Intercreditor Agreement;
or
(4) modify any of the provisions of this Section or Section
6.05, except to increase any such percentage or to provide that certain
other provisions of this Agreement cannot be modified or waived without
the consent of the Certificateholder of each Certificate affected
thereby.
It shall not be necessary for any Act of Certificateholders
under this Section to approve the particular form of any proposed supplemental
agreement, but it shall be sufficient if such Act shall approve the substance
thereof.
Section 9.03. Documents Affecting Immunity or Indemnity. If in
the opinion of the Trustee any document required to be executed by it pursuant
to the terms of Section 9.01 or 9.02 affects any interest, right, duty, immunity
or indemnity in favor of the Trustee under this Agreement, the Trustee may in
its discretion decline to execute such document.
Section 9.04. Execution of Supplemental Agreements. In
executing, or accepting the additional trusts created by, any supplemental
agreement permitted by this Article or the modifications thereby of the trusts
created by this Agreement, the Trustee shall be entitled to receive, and shall
be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement.
Section 9.05. Effect of Supplemental Agreements. Upon the
execution of any agreement supplemental to this Agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every
Certificateholder theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
Section 9.06. Conformity with Trust Indenture Act. Every
supplemental agreement executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.
Section 9.07. Reference in Certificates to Supplemental
Agreements. Certificates authenticated and delivered after the execution of any
supplemental agreement pursuant to this Article may bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
agreement; and, in such case, suitable notation may be made upon Outstanding
Certificates after proper presentation and demand.
ARTICLE X
AMENDMENTS TO INDENTURES AND FINANCING DOCUMENTS
Section 10.01. Amendments and Supplements to Indentures and
Other Financing Documents. In the event that the Trustee, as holder of any
Equipment Note in trust for the benefit of the Certificateholders or as
Controlling Party, receives a request for a consent to any amendment,
modification, waiver or supplement under any Indenture or other Financing
Document, the Trustee shall forthwith send a notice of such proposed amendment,
modification, waiver or supplement to each Certificateholder registered on the
Register as of the date of such notice. The Trustee shall request from the
Certificateholders a Direction as to (a) whether or not to take or refrain from
taking any action which a holder of such Equipment Note has the option to
direct, (b) whether or not to give or execute any waivers, consents, amendments,
modifications or supplements as a holder of such Equipment Note and (c) how to
vote any Equipment Note if a vote has been called for with respect thereto.
Provided such a request for Certificateholder Direction shall have been made, in
directing any action or casting any vote or giving any consent as the holder of
any Equipment Note, the Trustee shall vote for or give consent to any such
action with respect to such Equipment Note in the same proportion as that of (i)
the aggregate face amounts of all Certificates actually voted in favor of or for
giving consent to such action by such Act of Certificateholders to (ii) the
aggregate face amount of all Outstanding Certificates. For purposes of the
immediately preceding sentence, a Certificate shall have been "actually voted"
if the Holder of such Certificate has delivered to the Trustee an instrument
evidencing such Holder's consent to such Direction on or prior to the Business
Day before the Trustee directs such action or casts such vote or gives such
consent. Notwithstanding the foregoing, but subject to Section 6.04 and the
Intercreditor Agreement, the Trustee may, in its own discretion and at its own
direction, consent and notify the relevant Loan Trustee of such consent to any
amendment, modification, waiver or supplement under the relevant Indenture or
any other Financing Document, if an Event of Default hereunder shall have
occurred and be continuing, or if such amendment, modification or waiver will
not adversely affect the interests of the Certificateholders.
ARTICLE XI
TERMINATION OF TRUST
Section 11.01. Termination of the Trust. The respective
obligations and responsibilities of the Company, the Guarantor and the Trustee
with respect to the Trust shall terminate upon the distribution to all Holders
of Certificates and the Trustee of all amounts required to be distributed to
them pursuant to this Agreement and the disposition of all property held as part
of the Trust Property; provided, however, that in no event shall the Trust
continue beyond one hundred ten (110) years following the date of the earliest
execution of this Trust Agreement.
Notice of any termination, specifying the Regular Distribution
Date (or Special Distribution Date, as the case may be) upon which the
Certificateholders may surrender their Certificates to the Trustee for payment
of the final distribution and cancellation, shall be mailed promptly, upon
notice to the Trustee, by the Trustee to Certificateholders not earlier than the
60th day and not later than the 20th day next preceding such final distribution
specifying (A) the Regular Distribution Date (or Special Distribution Date, as
the case may be) upon which the proposed final payment of the Certificates will
be made upon presentation and surrender of Certificates at the office or agency
of the Trustee therein specified, (B) the amount of any such proposed final
payment, and (C) that the Record Date otherwise applicable to such Regular
Distribution Date (or Special Distribution Date, as the case may be) is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified. The
Trustee shall give such notice to the Registrar at the time such notice is given
to Certificateholders. Upon presentation and surrender of the Certificates in
accordance with such notice, the Trustee shall cause to be distributed to
Certificateholders such final distribution pursuant to Section 4.02.
In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. No additional interest shall accrue on the Certificates after the
Regular Distribution Date (or Special Distribution Date, as the case may be)
specified in the first written notice. In the event that any money held by the
Trustee for the payment of distributions on the Certificates shall remain
unclaimed for two years (or such lesser time as the Trustee shall be satisfied,
after sixty days' notice from the Company, is one month prior to the escheat
period provided under applicable law) after the final distribution date with
respect thereto, the Trustee shall pay to each Loan Trustee the appropriate
amount of money relating to such Loan Trustee and shall give written notice
thereof to the related Owner Trustees, the Owner Participants and the Company.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Limitation on Rights of Certificateholders. The
death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations, and liabilities of the parties
hereto or any of them.
Section 12.02. Certificates Nonassessable and Fully Paid.
Except as set forth in the last sentence of this Section 12.02,
Certificateholders shall not be personally liable for obligations of the Trust,
the Fractional Undivided Interests represented by the Certificates shall be
nonassessable for any losses or expenses of the Trust or for any reason
whatsoever, and Certificates, upon authentication thereof by the Trustee
pursuant to Section 3.03, are and shall be deemed fully paid. No
Certificateholder shall have any right (except as expressly provided herein) to
vote or in any manner otherwise control the operation and management of the
Trust Property, the Trust, or the obligations of the parties hereto, nor shall
anything set forth herein, or contained in the terms of the Certificates, be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association. Neither the existence of the Trust nor
any provision herein is intended to or shall limit the liability the
Certificateholders would otherwise incur if the Certificateholders owned Trust
Property as co-owners, or incurred any obligations of the Trust, directly rather
than through the Trust.
Section 12.03. Notices. (a) Unless otherwise specifically
provided herein, all notices required under the terms and provisions of this
Agreement shall be in English and in writing, and any such notice may be given
by United States mail, courier service or telecopy, and any such notice shall be
effective when delivered or received or, if mailed, three days after deposit in
the United States mail with proper postage for ordinary mail prepaid,
if to the Company or the Guarantor, to:
Atlantic Coast Airlines
515A Shaw Road
Dulles, Virginia 20166
Attention: Chief Financial Officer
Facsimile: (703) 925-6294
if to the Trustee, to:
The First National Bank of Maryland
25 South Charles Street
Mail Code 101-591
Baltimore, Maryland 21201
Attention: Corporate Trust Department
Facsimile: (410) 244-4626
Telephone: (410) 244-4236
(b) The Company, the Guarantor or the Trustee, by notice to
the other, may designate additional or different addresses for subsequent
notices or communications.
(c) Any notice or communication to Certificateholders shall be
mailed by first-class mail to the addresses for Certificateholders shown on the
Register kept by the Registrar. Failure so to mail a notice or communication or
any defect in such notice or communication shall not affect its sufficiency with
respect to other Certificateholders.
(d) If a notice or communication is mailed in the manner
provided above within the time prescribed, it is conclusively presumed to have
been duly given, whether or not the addressee receives it.
(e) If the Company mails a notice or communication to the
Certificateholders, it shall mail a copy to the Trustee and to the Paying Agent
at the same time.
(f) Notwithstanding the foregoing, all communications or
notices to the Trustee shall be deemed to be given only when received by a
Responsible Officer of the Trustee.
(g) The Trustee shall promptly furnish the Company with a copy
of any demand, notice or written communication received by the Trustee hereunder
from any Certificateholder, Owner Trustee or Loan Trustee.
Section 12.04. Governing Law. THIS AGREEMENT HAS BEEN
DELIVERED IN THE STATE OF NEW YORK AND THIS AGREEMENT AND THE CERTIFICATES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICTS-OF-LAW PRINCIPLES.
Section 12.05. Severability of Provisions. If any one or more
of the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions,
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or the Trust, or of the
Certificates or the rights of the Certificateholders thereof.
Section 12.06. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and shall not affect the
construction hereof.
Section 12.07. Successors and Assigns. All covenants,
agreements, representations and warranties in this Agreement by the Trustee, the
Guarantor and the Company shall bind and, to the extent permitted hereby, shall
inure to the benefit of and be enforceable by their respective successors and
assigns, whether so expressed or not.
Section 12.08. Benefits of Agreement. Nothing in this
Agreement or in the Certificates, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, and the
Certificateholders, any benefit or any legal or equitable right, remedy or claim
under this Agreement.
Section 12.09. Legal Holidays. In any case where any Regular
Distribution Date or Special Distribution Date relating to any Certificate shall
not be a Business Day, then (notwithstanding any other provision of this
Agreement) payment need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on such
Regular Distribution Date or Special Distribution Date, and no interest shall
accrue during the intervening period.
Section 12.10. Counterparts. For the purpose of facilitating
the execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
Section 12.11. Communication by Certificateholders with Other
Certificateholders. Certificateholders may communicate with other
Certificateholders with respect to their rights under this Agreement or the
Certificates pursuant to Section 312(b) of the Trust Indenture Act. The Company,
the Guarantor, the Trustee and any and all other persons benefitted by this
Agreement shall have the protection afforded by Section 312(c) of the Trust
Indenture Act.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first written above.
ATLANTIC COAST AIRLINES
By
Name:
Title:
ATLANTIC COAST AIRLINES, INC.
By
Name:
Title:
THE FIRST NATIONAL BANK OF MARYLAND, as
Trustee
By
Name: Robert D. Brown
Title: Assistant Vice President
A-1
179212.3/NYL2
179212.3/NYL2
179212.3/NYL2
EXHIBIT A
A-7
179212.3/NYL2
FORM OF CERTIFICATE
REGISTERED
No. ______________
[THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT
OR BENEFIT OF, ANY PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT), (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT
IS NOT A U.S. PERSON AND IS ACQUIRING THIS CERTIFICATE IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT;
(2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE OF THIS CERTIFICATE OR THE LAST DATE ON WHICH THIS
CERTIFICATE WAS HELD BY ATLANTIC COAST AIRLINES ("ACA") OR ANY
AFFILIATE OF ACA, RESELL OR OTHERWISE TRANSFER THIS CERTIFICATE EXCEPT
(A) TO ACA OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL
ACCREDITED INVESTOR ACQUIRING $100,000 OR MORE AGGREGATE PRINCIPAL
AMOUNT OF SUCH CERTIFICATE THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS CERTIFICATE
(THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D)
OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS CERTIFICATE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS
CERTIFICATE WITHIN TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE
OF THIS CERTIFICATE OR THE LAST DATE ON WHICH THIS CERTIFICATE WAS HELD
BY ACA OR ANY AFFILIATE OF ACA, THE HOLDER MUST CHECK THE APPROPRIATE
BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH
TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. IF THE PROPOSED
TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND ACA SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM
MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE
TERMS "OFFSHORE TRANSACTION", "UNITED STATES" AND "U.S. PERSON" HAVE
THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
THE PASS THROUGH TRUST AGREEMENT CONTAINS A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS CERTIFICATE IN
VIOLATION OF THE FOREGOING RESTRICTIONS.]*
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IN EXCHANGE FOR THIS CERTIFICATE IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL CERTIFICATE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
CERTIFICATE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 3.05 AND 3.06 OF THE PASS THROUGH
TRUST AGREEMENT REFERRED TO HEREIN.]*
ANY PERSON ACQUIRING THIS PASS THROUGH CERTIFICATE WILL BE DEEMED TO
REPRESENT AND WARRANT THAT (i) NO ASSETS OF AN EMPLOYEE BENEFIT PLAN
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR AN INDIVIDUAL RETIREMENT ACCOUNT OR PLAN
SUBJECT TO 4975 OF THE CODE, OR ANY TRUST ESTABLISHED UNDER ANY SUCH
PLAN OR ACCOUNT, HAVE BEEN USED TO ACQUIRE OR HOLD ANY OF THE PASS
THROUGH CERTIFICATES OR (ii) THAT ONE OR MORE ADMINISTRATIVE OR
STATUTORY EXEMPTIONS FROM THE PROHIBITED TRANSACTION RULES UNDER
SECTION 406 OF ERISA AND SECTION 4975 OF THE CODE APPLIES TO ITS
PURCHASE AND HOLDING OF THIS PASS THROUGH CERTIFICATE SUCH THAT ITS
PURCHASE AND HOLDING OF THIS PASS THROUGH CERTIFICATE WILL NOT RESULT
IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA AND
SECTION 4975 OF THE CODE.
[GLOBAL CERTIFICATE]*
ATLANTIC COAST AIRLINES 1997-1A PASS THROUGH TRUST
7.20% Atlantic Coast Airlines Pass Through Certificate
Series 1997-1A
Final Expected Distribution Date: January 1, 2014
evidencing a fractional undivided interest in a trust, the property of which
includes certain equipment notes each secured by an Aircraft leased to or owned
by Atlantic Coast Airlines.
$ Fractional Undivided Interest
representing . % of the Trust per $1,000 face amount
THIS CERTIFIES THAT , for value received, is the registered
owner of a $ ( dollars) Fractional Undivided Interest in Atlantic Coast Airlines
1997-1A Pass Through Trust (the "Trust") created pursuant to a Pass Through
Trust Agreement, dated as of September 25, 1997 (the "Agreement"), among The
First National Bank of Maryland (the "Trustee"), Atlantic Coast Airlines, a
corporation incorporated under California law (the "Company") and Atlantic Coast
Airlines, Inc., a corporation incorporated under Delaware law (the "Guarantor"),
a summary of certain of the pertinent provisions of which is set forth below. To
the extent not otherwise defined herein, the capitalized terms used herein have
the meanings assigned to them in the Agreement. This Certificate is one of the
duly authorized Certificates designated as "7.20% Atlantic Coast Airlines Pass
Through Certificates Series 1997-1A" (herein called the "Certificates"). This
Certificate is issued under and is subject to the terms, provisions, and
conditions of the Agreement. By virtue of its acceptance hereof the
Certificateholder of this Certificate assents to and agrees to be bound by the
provisions of the Agreement and the Intercreditor Agreement. The property of the
Trust includes certain Equipment Notes and all rights of the Trust to receive
payments under the Intercreditor Agreement and the Liquidity Facility (the
"Trust Property"). Each issue of the Equipment Notes is secured by, among other
things, a security interest in the Aircraft leased to or owned by the Company.
The Certificates represent fractional undivided interests in
the Trust and the Trust Property, and have no rights, benefits or interest in
respect of any assets or property other than the Trust Property.
Subject to and in accordance with the terms of the Agreement
and the Intercreditor Agreement, from and to the extent of funds then available
to the Trustee, there will be distributed on each January 1 and July 1 (a
"Regular Distribution Date"), commencing on January 1, 1998, to the Person in
whose name this Certificate is registered at the close of business on the 15th
day preceding the Regular Distribution Date, an amount in respect of the
Scheduled Payments on the Equipment Notes due on such Regular Distribution Date,
the receipt of which has been confirmed by the Trustee, equal to the product of
the percentage interest in the Trust evidenced by this Certificate and an amount
equal to the sum of such Scheduled Payments. Subject to and in accordance with
the terms of the Agreement and the Intercreditor Agreement, in the event that
Special Payments on the Equipment Notes are received by the Trustee, from funds
then available to the Trustee, there shall be distributed on the applicable
Special Distribution Date, to the Person in whose name this Certificate is
registered at the close of business on the 15th day preceding the Special
Distribution Date, an amount in respect of such Special Payments on the
Equipment Notes, the receipt of which has been confirmed by the Trustee, equal
to the product of the percentage interest in the Trust evidenced by this
Certificate and an amount equal to the sum of such Special Payments so received.
If a Regular Distribution Date or Special Distribution Date is not a Business
Day, distribution shall be made on the immediately following Business Day with
the same force and effect as if made on such Regular Distribution Date or
Special Distribution Date and no interest shall accrue during the intervening
period. The Trustee shall mail notice of each Special Payment and the Special
Distribution Date therefor to the Certificateholder of this Certificate.
Except as otherwise provided in the Agreement and
notwithstanding the above, the final distribution on this Certificate will be
made after notice mailed by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
of the Trustee specified in such notice.
THE AGREEMENT AND THIS CERTIFICATE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICTS-OF-LAW PRINCIPLES.
Reference is hereby made to the further provisions of this
Certificate set forth in the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.
Dated: _____________, ATLANTIC COAST AIRLINES
1997-1A PASS THROUGH
TRUST
By: The First National Bank of Maryland,
not in its individual capacity but
solely as Trustee
By:
Name:
Title:
[FORM OF THE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
A-9
179212.3/NYL2
This is one of the Certificates referred
to in the within-mentioned Agreement.
The First National Bank of Maryland,
not in its individual capacity but
solely as Trustee
By:
Authorized Officer
[REVERSE OF CERTIFICATE]
The Certificates do not represent a direct obligation of, or
an obligation guaranteed by, or an interest in, the Company, the Guarantor or
the Trustee or any of their affiliates. The Certificates are limited in right or
payment, all as more specifically set forth on the face hereof and in the
Agreement. All payments or distributions made to Certificateholders under the
Agreement shall be made only from the Trust Property and only to the extent that
the Trustee shall have sufficient income or proceeds from the Trust Property to
make such payments in accordance with the terms of the Agreement. Each
Certificateholder of this Certificate, by its acceptance hereof, agrees that it
will look solely to the income and proceeds from the Trust Property to the
extent available for distribution to such Certificateholder as provided in the
Agreement. This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds, and duties evidenced hereby.
A copy of the Agreement may be examined during normal business hours at the
principal office of the Trustee, and at such other places, if any, designated by
the Trustee, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the Guarantor and the rights of the
Certificateholders under the Agreement at any time by the Guarantor, the Company
and the Trustee with the consent of the Certificateholders holding Certificates
evidencing Fractional Undivided Interests aggregating not less than a majority
in interest in the Trust. Any such consent by the Certificateholder of this
Certificate shall be conclusive and binding on such Certificateholder and upon
all future Certificateholders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Certificateholders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Register upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee in its capacity as
Registrar, or by any successor Registrar, in the Borough of Manhattan, the City
of New York, duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Trustee and the Registrar duly executed by the
Certificateholder hereof or such Certificateholder's attorney duly authorized in
writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate Fractional Undivided Interest in the Trust will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in minimum denominations of $100,000 Fractional Undivided
Interest and integral multiples of $1,000 in excess thereof. As provided in the
Agreement and subject to certain limitations therein set forth, the Certificates
are exchangeable for new Certificates of authorized denominations evidencing the
same aggregate Fractional Undivided Interest in the Trust, as requested by the
Certificateholder surrendering the same.
A-5
179212.3/NYL2
A-11
179212.3/NYL2
No service charge will be made for any such registration of
transfer or exchange, but the Trustee shall require payment by the Holder of a
sum sufficient to cover any tax or governmental charge payable in connection
therewith.
The Trustee, the Registrar, and any agent of the Trustee or
the Registrar may treat the person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Trustee, the Registrar,
nor any such agent shall be affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement
and the Trust created thereby shall terminate upon the distribution to
Certificateholders of all amounts required to be distributed to them pursuant to
the Agreement and the disposition of all property held as part of the Trust
Property.
FORM OF TRANSFER NOTICE
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s) and
transfer(s) unto
Insert Taxpayer Identification No.
please print or typewrite name and address including zip code of assignee
the within Certificate and all rights thereunder, hereby irrevocably constituting and appointing
attorney to transfer said Certificate on the books of the Trustee with full
power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL CERTIFICATES
EXCEPT PERMANENT OFFSHORE GLOBAL AND
OFFSHORE PHYSICAL CERTIFICATES]
In connection with any transfer of this Certificate occurring
prior to __________, the undersigned confirms that without utilizing any general
solicitation or general advertising that:
[Check One]
[ ] (a) this Certificate is being transferred in compliance with
the exemption from registration under the Securities Act of
1933, as amended, provided by Rule 144A thereunder.
or
[ ] (b) this Certificate is being transferred other than in
accordance with (a) above and documents are being furnished
that comply with the conditions of transfer set forth in this
Certificate and the Agreement.
If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Certificate in the name of any Person
other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 3.06 of the Agreement
shall have been satisfied.
Date: [Name of Transferor]
NOTE: The signature
must correspond with
the name as written
upon the face of the
within-mentioned
instrument in every
particular, without
alteration or any
change whatsoever.
Signature Guarantee:
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing
this Certificate for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, as amended, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned has requested pursuant to
Rule 144A or has determined not to request such information and that it is aware
that the transferor is relying upon the undersigned's foregoing representations
in order to claim the exemption from registration provided by Rule 144A.
Dated:
NOTE: To be executed by an executive
officer.
A-7
179212.3/NYL2
179212.3/NYL2
179212.3/NYL2
EXHIBIT B
A-13
179212.3/NYL2
FORM OF CERTIFICATE FOR UNLEGENDED CERTIFICATES
[Date]
[Name and address of Trustee]
Attention: Corporate Trust Department
Re: Atlantic Coast Airlines 1997-1A Pass Through Trust, ___%
Atlantic Coast Airlines Pass Through Certificates Series
1997-1A (the "Certificates")
Dear Sirs:
This letter relates to U.S. $__________ Fractional Undivided
Interest of Certificates represented by a Certificate (the "Legended
Certificate") which bears a legend outlining restrictions upon transfer of such
Legended Certificate. Pursuant to Section 3.01 of the Pass Through Trust
Agreement relating to the Certificates dated as of September 25,1997 (the "Trust
Agreement"), among Atlantic Coast Airlines ("ACA"), Atlantic Coast Airlines,
Inc. ("ACAI") and you, we hereby certify that we are (or we will hold such
securities on behalf of) a person outside the United States to whom the
Certificates could be transferred in accordance with Rule 904 of Regulation S
promulgated under the U.S. Securities Act of 1933, as amended. Accordingly, you
are hereby requested to exchange the legended certificate for an unlegended
certificate representing an identical principal amount of Certificates, all in
the manner provided for in the Trust Agreement.
You, ACA and ACAI are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.
Very truly yours,
[Name of Certificateholder]
By:
Authorized Signature
C-1
179212.3/NYL2
179212.3/NYL2
179212.3/NYL2
EXHIBIT C
C-2
179212.3/NYL2
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION
WITH TRANSFERS PURSUANT TO REGULATION S
[date]
[Name and address of Trustee]
Attention: Corporate Trust Department
Re: Atlantic Coast Airlines 1997-1A Pass Through Trust
(the "Trust"), 7.20% Atlantic Coast Airlines Pass Through
Certificates Series 1997-1A (the "Certificates")
Sirs:
In connection with our proposed sale of $_______ Fractional
Undivided Interest of the Certificates, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the Securities
Act of 1933, as amended, and, accordingly, we represent that:
(1) the offer of the Certificates was not made to a person in the United States;
(2) either (a) at the time the buy order was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we
nor any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act.
In addition, if the sale is made during a restricted period
and the provisions of Rule 903(c)(3) or Rule 904(c)(1) of Regulation S are
applicable thereto, we confirm that such sale has been made in accordance with
the applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case may
be.
You, Atlantic Coast Airlines and Atlantic Coast Airlines, Inc.
are entitled to rely upon this letter and are irrevocably authorized to produce
this letter or a copy hereof to any interested party in any administrative or
legal proceedings or official inquiry with respect to the matters covered
hereby. Terms used in this certificate have the meanings set forth in Regulation
S.
Very truly yours,
[Name of Transferor]
By:_______________________
Authorized Signature
D-1
EXHIBIT D
D-3
FORM OF CERTIFICATE TO BE
DELIVERED IN CONNECTION WITH
TRANSFERS TO NON-QIB ACCREDITED INVESTORS
[date]
[Name and address of Trustee]
Attention: Corporate Trust Department
Re: Atlantic Coast Airlines 1997-1A Pass-Through
Trust (the "Trust"), 7.20% Atlantic Coast Airlines
Pass Through Certificates Series 1997-1A
(the "Certificates")
Dear Sirs:
In connection with our proposed purchase of $_______________
aggregate principal amount of the Certificates, we confirm that:
1. We understand that any subsequent transfer of the
Certificates is subject to certain restrictions and conditions set
forth in the Pass Through Trust Agreement dated as of September 25,
1997 relating to the Certificates (the "Pass Through Trust Agreement")
and the undersigned agrees to be bound by, and not to resell, pledge or
otherwise transfer the Certificates except in compliance with, such
restrictions and conditions and the Securities Act of 1933, as amended
(the "Securities Act").
2. We are purchasing Certificates having an aggregate
principal amount of not less than $100,000 and each account (if any)
for which we are purchasing Certificates is purchasing Certificates
having an aggregate principal amount of not less than $100,000.
3. We understand that the Certificates have not been
registered under the Securities Act, and that the Certificates may not
be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are
acting as hereinafter stated, that if we should sell any Certificate,
we will do so only (A) in accordance with Rule 144A under the
Securities Act to a "qualified institutional buyer" (as defined
therein), (B) to an institutional "accredited investor" (as defined
below) that, prior to such transfer, furnishes to you and Atlantic
Coast Airlines, Inc., a signed letter substantially in the form of this
letter, (C) outside the United States in accordance with Rule 904 of
Regulation S under the Securities Act, (D) pursuant to the exemption
from registration provided by Rule 144 under the Securities Act, or (E)
pursuant to an effective registration statement under the Securities
Act, and we further agree to provide to any person purchasing any of
the Certificates from us a notice advising such purchaser that resales
of the Notes are restricted as stated herein. We further understand
that the Certificates purchased by us will bear a legend to the
foregoing effect.
4. We understand that, on any proposed resale of any
Certificates, we will be required to furnish to you, Atlantic Coast
Airlines ("ACA") and Atlantic Coast Airlines, Inc. ("ACAI") such
certifications, legal opinions and other information as you, ACA and
ACAI may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that the
Certificates purchased by us will bear a legend to the foregoing
effect.
5. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of our
investment in the Certificates and we and any accounts for which we are
acting are each able to bear the economic risk of our or its
investment.
6. We are acquiring the Certificates purchased by us for our
own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise
sole investment discretion.
You, ACA and ACAI are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Transferor]
By:
Authorized Signature
179212.3/NYL2
179212.3/NYL2
PASS THROUGH TRUST AGREEMENT
Dated as of September 25, 1997
among
ATLANTIC COAST AIRLINES,
ATLANTIC COAST AIRLINES, INC.
and
THE FIRST NATIONAL BANK OF MARYLAND
as Trustee
Atlantic Coast Airlines 1997-1A Pass Through Trust
7.20% 1997-1A Pass Through Certificates
5
Section Page
179212.3/NYL2
179212.3/NYL2
179212.3/NYL2
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.01. Definitions.......................................................................................... 2
-----------
1.02. Compliance Certificates and Opinions................................................................. 12
------------------------------------
1.03. Form of Documents Delivered to Trustee............................................................... 13
--------------------------------------
1.04. Acts of Certificateholders........................................................................... 14
--------------------------
ARTICLE II
ORIGINAL ISSUANCE OF CERTIFICATES;
ACQUISITION OF EQUIPMENT NOTES
2.01. Issuance of Certificates; Acquisition of Equipment Notes............................................. 15
--------------------------------------------------------
2.02. Acceptance by Trustee................................................................................ 17
---------------------
2.03. Limitation of Powers................................................................................. 18
--------------------
ARTICLE III
THE CERTIFICATES
3.01. Title, Form, Denomination and Execution of Certificates.............................................. 18
-------------------------------------------------------
3.02. Restrictive Legends.................................................................................. 19
-------------------
3.03. Authentication of Certificates....................................................................... 21
------------------------------
3.04. Transfer and Exchange................................................................................ 22
---------------------
3.05. Book-Entry Provisions for U.S. Global Certificate and Offshore Global Certificates................... 22
----------------------------------------------------------------------------------
3.06. Special Transfer Provisions.......................................................................... 24
---------------------------
3.07. Mutilated, Destroyed, Lost or Stolen Certificates.................................................... 27
-------------------------------------------------
3.08. Persons Deemed Owners................................................................................ 28
---------------------
3.09. Cancellation......................................................................................... 28
------------
3.10. Limitation of Liability for Payments................................................................. 28
------------------------------------
3.11. Temporary Certificates............................................................................... 28
----------------------
ARTICLE IV
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
4.01. Certificate Account and Special Payments Account..................................................... 29
------------------------------------------------
4.02. Distributions from Certificate Account and Special Payments Account.................................. 29
-------------------------------------------------------------------
4.03. Statements to Certificateholders..................................................................... 31
--------------------------------
4.04. Investment of Special Payment Moneys................................................................. 31
------------------------------------
ARTICLE V
THE COMPANY
5.01. Maintenance of Corporate Existence................................................................... 32
----------------------------------
5.02. Consolidation, Merger, Etc........................................................................... 32
--------------------------
ARTICLE VI
DEFAULT
6.01. Events of Default.................................................................................... 33
-----------------
6.02. Incidents of Sale of Equipment Notes................................................................. 36
------------------------------------
6.03. Judicial Proceedings Instituted by Trustee; Trustee May Bring Suit................................... 36
------------------------------------------------------------------
6.04. Control by Certificateholders........................................................................ 37
-----------------------------
6.05. Waiver of Past Defaults.............................................................................. 37
-----------------------
6.06. Right of Certificateholders to Receive Payments Not to Be Impaired................................... 38
------------------------------------------------------------------
6.07. Certificateholders May Not Bring Suit Except Under Certain Conditions................................ 38
---------------------------------------------------------------------
6.08. Remedies Cumulative.................................................................................. 39
-------------------
6.09. Undertaking for Costs................................................................................ 39
---------------------
ARTICLE VII
THE TRUSTEE
7.01. Certain Duties and Responsibilities.................................................................. 39
-----------------------------------
7.02. Notice of Defaults................................................................................... 40
------------------
7.03. Certain Rights of Trustee............................................................................ 40
-------------------------
7.04. Not Responsible for Recitals or Issuance of Certificates............................................. 41
--------------------------------------------------------
7.05. May Hold Certificates................................................................................ 42
---------------------
7.06. Money Held in Trust.................................................................................. 42
-------------------
7.07. Compensation and Reimbursement....................................................................... 42
------------------------------
7.08. Corporate Trustee Required; Eligibility.............................................................. 43
---------------------------------------
7.09. Resignation and Removal; Appointment of Successor.................................................... 44
-------------------------------------------------
7.10. Acceptance of Appointment by Successor............................................................... 45
--------------------------------------
7.11. Merger, Conversion, Consolidation or Succession to Business.......................................... 46
-----------------------------------------------------------
7.12. Maintenance of Agencies.............................................................................. 46
-----------------------
7.13. Money for Certificate Payments to Be Held in Trust................................................... 47
--------------------------------------------------
7.14. Registration of Equipment Notes in Name of Subordination Agent....................................... 47
--------------------------------------------------------------
7.15. Representations and Warranties of Trustee............................................................ 48
-----------------------------------------
7.16. Withholding Taxes; Information Reporting............................................................. 49
----------------------------------------
7.17. Trustee's Liens...................................................................................... 49
---------------
7.18. Preferential Collection of Claims.................................................................... 50
---------------------------------
ARTICLE VIII
CERTIFICATEHOLDERS' LISTS AND REPORTS BY TRUSTEE
8.01. The Company to Furnish Trustee with Names and Addresses of Certificateholders........................ 50
-----------------------------------------------------------------------------
8.02. Preservation of Information; Communications to Certificateholders.................................... 50
-----------------------------------------------------------------
8.03. Reports by Trustee................................................................................... 50
------------------
8.04. Reports by the Guarantor and the Company............................................................. 50
----------------------------------------
ARTICLE IX
SUPPLEMENTAL AGREEMENTS
9.01. Supplemental Agreements Without Consent of Certificateholders........................................ 52
-------------------------------------------------------------
9.02. Supplemental Agreements with Consent of Certificateholders........................................... 53
----------------------------------------------------------
9.03. Documents Affecting Immunity or Indemnity............................................................ 54
-----------------------------------------
9.04. Execution of Supplemental Agreements................................................................. 54
------------------------------------
9.05. Effect of Supplemental Agreements.................................................................... 54
---------------------------------
9.06. Conformity with Trust Indenture Act.................................................................. 54
-----------------------------------
9.07. Reference in Certificates to Supplemental Agreements................................................. 54
----------------------------------------------------
ARTICLE X
AMENDMENTS TO INDENTURES AND FINANCING DOCUMENTS
10.01. Amendments and Supplements to Indentures and Other Financing Documents.............................. 54
----------------------------------------------------------------------
ARTICLE XI
TERMINATION OF TRUST
11.01. Termination of the Trust............................................................................ 55
------------------------
ARTICLE XII
MISCELLANEOUS PROVISIONS
12.01. Limitation on Rights of Certificateholders.......................................................... 56
12.02. Certificates Nonassessable and Fully Paid........................................................... 56
12.03. Notices 57
12.04. Governing Law....................................................................................... 58
-------------
12.05. Severability of Provisions.......................................................................... 58
--------------------------
12.06. Effect of Headings and Table of Contents............................................................ 58
----------------------------------------
12.07. Successors and Assigns.............................................................................. 58
----------------------
12.08. Benefits of Agreement............................................................................... 58
---------------------
12.09. Legal Holidays...................................................................................... 58
--------------
12.10. Counterparts........................................................................................ 59
------------
12.11. Communication by Certificateholders with Other Certificateholders................................... 59
-----------------------------------------------------------------
Schedule 1 - Indentures
Schedule 2 - Financing Agreements
Exhibit A - Form of Certificate
Exhibit B - Form of Certificate for Unlegended Certificates
Exhibit C - Form of Certificate to be Delivered in Connection with
Transfers Pursuant to Regulation S
Exhibit D - Form of Certificate to be Delivered in Connection with
Transfers to Non-QIB Accredited Investors
17
SS_NYL4/255622 1