King & Spalding
DRAFT: 2/28/96
TRUST INDENTURE AND SECURITY AGREEMENT
(DELTA 1994-1)
Dated as of
April 1, 1994
Amended and Restated
as of
March 1, 1996
BETWEEN
WILMINGTON TRUST COMPANY,
Owner Trustee,
AND
THE BANK OF NEW YORK,
Indenture Trustee
TABLE OF CONTENTS
Page
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RECITALS........................................................... 1
GRANTING CLAUSE.................................................... 2
HABENDUM CLAUSE.................................................... 4
ARTICLE I
DEFINITIONS........................................................ 6
ARTICLE II
ISSUE, EXECUTION, FORM AND
REGISTRATION OF CERTIFICATES
SECTION 2.01 Authentication and Delivery of Certificates......... 14
SECTION 2.02 Execution of Certificates........................... 14
SECTION 2.03 Certificate of Authentication....................... 15
SECTION 2.04 Form and Terms of Certificates; Payments
of Principal, Premium and Interest.................. 15
SECTION 2.05 Payments from Indenture Estate Only................. 16
SECTION 2.06 Registration, Transfer and Exchange................. 18
SECTION 2.07 Mutilated, Defaced, Destroyed, Lost and
Stolen Certificates................................. 19
SECTION 2.08 Cancellation of Certificates; Destruction
Thereof............................................. 20
SECTION 2.09 Temporary certificates.............................. 20
SECTION 2.10 Termination of Interest in Indenture
Estate.............................................. 21
SECTION 2.11 Certificates in Respect of Replacement
Airframe or Engine.................................. 21
ARTICLE III
COVENANTS
SECTION 3.01 Payment of Principal, Premium and Interest.......... 21
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SECTION 3.02 Offices for Payments, etc........................... 22
SECTION 3.03 Appointment to Fill a Vacancy in Office of
Indenture Trustee................................... 22
SECTION 3.04 Paying Agents....................................... 22
SECTION 3.05 Covenants of the Trust Company and the Owner
Trustee............................................. 23
SECTION 3.06 Intentionally Left Blank............................ 24
SECTION 3.07 Disposal of Indenture Estate........................ 24
SECTION 3.08 No Representations or Warranties as to Aircraft or
Documents........................................... 24
SECTION 3.09 Further Assurances; Financing Statements............ 25
ARTICLE IV
HOLDER LISTS AND REPORTS
BY THE INDENTURE TRUSTEE........................ 25
ARTICLE V
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE INDENTURE ESTATE
SECTION 5.01 Basic Rent Distribution............................. 25
SECTION 5.02 Event of Loss and Replacement; Redemption or
Purchase............................................ 26
SECTION 5.03 Payment After Indenture Event of Default, etc....... 27
SECTION 5.04 Certain Payments.................................... 28
SECTION 5.05 Other Payments...................................... 28
SECTION 5.06 Payments to Owner Trustee........................... 28
SECTION 5.07 Application of Payments............................. 29
SECTION 5.08 Investment of Amounts Held by Indenture Trustee..... 29
SECTION 5.09 Withholding Taxes................................... 30
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ARTICLE VI
REDEMPTION OR PURCHASE OF CERTIFICATES
SECTION 6.01 No Redemption Prior to Maturity....................... 31
SECTION 6.02 Redemption or Purchase of Certificates................ 31
SECTION 6.03 Notice of Redemption or Purchase to Holders........... 32
SECTION 6.04 Deposit of Redemption Price........................... 32
SECTION 6.05 Certificates Payable on Redemption Date............... 33
SECTION 6.06 Mandatory Sinking Fund Redemptions.................... 33
ARTICLE VII
REMEDIES OF INDENTURE TRUSTEE
AND HOLDERS
SECTION 7.01 Indenture Event of Default............................ 34
SECTION 7.02 Remedies.............................................. 36
SECTION 7.03 Return of Aircraft, etc............................... 39
SECTION 7.04 Indenture Trustee May Prove Debt...................... 42
SECTION 7.05 Remedies Cumulative................................... 44
SECTION 7.06 Suits for Enforcement................................. 44
SECTION 7.07 Discontinuance of Proceedings......................... 44
SECTION 7.08 Limitations on Suits by Holders....................... 45
SECTION 7.09 Unconditional Right of Holders to Receive Principal,
Interest and Premium, and to Institute Certain
Suits................................................. 45
SECTION 7.10 Control by Holders.................................... 45
SECTION 7.11 Waiver of Past Indenture Defaults..................... 46
SECTION 7.12 Notice of Indenture Defaults.......................... 47
SECTION 7.13 Waiver of Appraisement, etc.; Laws.................... 47
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ARTICLE VIII
RIGHTS OF THE OWNER TRUSTEE
AND THE OWNER PARTICIPANT
SECTION 8.01 Certain Rights of Owner Trustee and Owner
Participant........................................... 48
SECTION 8.02 Owner Participant's Right to Elect to Redeem or
Purchase the Certificates, and to Provide for
Payment............................................... 49
SECTION 8.03 Certain Rights of Owner Participant................... 51
ARTICLE IX
CONCERNING THE INDENTURE TRUSTEE
SECTION 9.01 Acceptance of Trusts.................................. 53
SECTION 9.02 Duties and Responsibilities of the Indenture Trustee;
During an Indenture Default; Prior to an Indenture
Default............................................... 53
SECTION 9.03 Certain Rights of the Indenture Trustee............... 55
SECTION 9.04 Indenture Trustee Not Responsible for Recitals,
Disposition of Certificates or Application of Proceeds
Thereof............................................... 57
SECTION 9.05 Indenture Trustee and Agents May Hold Certificates;
Collections, etc...................................... 57
SECTION 9.06 Moneys Held by Indenture Trustee...................... 57
SECTION 9.07 Right of Indenture Trustee to Rely on Officers'
Certificate, etc...................................... 57
SECTION 9.08 Replacement Airframes and Replacement Engines......... 57
SECTION 9.09 Trust Agreement and Trust Indenture Supplements for
Replacements.......................................... 60
SECTION 9.10 Effect of Replacement................................. 61
SECTION 9.11 Compensation.......................................... 61
ARTICLE X
CONCERNING THE HOLDERS
SECTION 10.01 Evidence of Action Taken by Holders................... 61
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SECTION 10.02 Proof of Execution of Instruments and of Holding of
Certificates.......................................... 62
SECTION 10.03 Holders to Be Treated as Owners....................... 62
SECTION 10.04 Certificates Owned by Owner Trustee and the Lessee
Deemed Not Outstanding................................ 62
SECTION 10.05 Right of Revocation of Action Taken................... 63
SECTION 10.06 ERISA Plan Prohibition................................ 64
ARTICLE XI
INDEMNIFICATION OF INDENTURE
TRUSTEE BY OWNER TRUSTEE.................... 64
ARTICLE XII
SUCCESSOR TRUSTEES
SECTION 12.01 Notice of Successor Owner Trustee..................... 65
SECTION 12.02 Resignation and Removal of Indenture Trustee;
Appointment of Successor.............................. 65
SECTION 12.03 Persons Eligible for Appointment as Indenture
Trustee............................................... 67
SECTION 12.04 Acceptance of Appointment by Successor Trustee........ 67
SECTION 12.05 Merger, Conversion, Consolidation or Succession to
Business of Indenture Trustee......................... 68
SECTION 12.06 Appointment of Separate Trustees...................... 68
ARTICLE XIII
SUPPLEMENTS AND AMENDMENTS TO THIS
INDENTURE AND OTHER DOCUMENTS
SECTION 13.01 Supplemental Indentures Without Consent of Holders.... 71
SECTION 13.02 Supplemental Indentures With Consent of Holders....... 72
SECTION 13.03 Effect of Supplemental Indenture...................... 73
SECTION 13.04 Documents to Be Given to Indenture Trustee............ 74
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SECTION 13.05 Notation on Certificates in Respect of Supplemental
Indentures.......................................... 74
SECTION 13.06 No Request Necessary for Lease Supplement or Trust
Agreement and Trust Indenture Supplement............ 74
SECTION 13.07 Amendments, Waivers, etc. of Other Indenture
Documents........................................... 74
ARTICLE XIV
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 14.01 Satisfaction and Discharge of Indenture; Termination
of Indenture........................................ 76
SECTION 14.02 Application by Indenture Trustee of Funds Deposited
for Payment of Certificates......................... 78
SECTION 14.03 Repayment of Moneys Held by Paying Agent............ 78
SECTION 14.04 Transfer of Moneys Held by Indenture Trustee and
Paying Agent Unclaimed for Two Years and Eleven
Months.............................................. 78
ARTICLE XV
MISCELLANEOUS
SECTION 15.01 Capacity in Which Acting............................ 79
SECTION 15.02 No Legal Title to Indenture Estate In Holders....... 79
SECTION 15.03 Sale of Indenture Estate by Indenture Trustee is
Binding............................................. 79
SECTION 15.04 Indenture for Benefit of Owner Trustee, Indenture
Trustee, Owner Participant and Holders.............. 79
SECTION 15.05 No Action Contrary to the Lessee's Rights Under the
Lease............................................... 79
SECTION 15.06 Notices............................................. 79
SECTION 15.07 Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein.................. 80
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SECTION 15.08 Severability........................................ 81
SECTION 15.09 No Oral Modifications or Continuing Waivers......... 82
SECTION 15.10 Successors and Assigns.............................. 82
SECTION 15.11 Headings............................................ 82
SECTION 15.12 Normal Commercial Relations......................... 82
SECTION 15.13 Governing Law; Counterpart Form..................... 82
ANNEX I - Description of Trust Indenture and Security Agreement
and Lease Agreement, as previously filed
EXHIBIT A - Intentionally Left Blank
EXHIBIT B - Form of Certificate
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TRUST INDENTURE AND SECURITY AGREEMENT
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(DELTA 1994-1)
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TRUST INDENTURE AND SECURITY AGREEMENT (DELTA 1994-1) dated as of April 1,
1994, as amended and restated as of March 1, 1996, between Wilmington Trust
Company, a Delaware banking corporation, not in its individual capacity, except
as otherwise specifically set forth herein, but solely as owner trustee under
the Trust Agreement, as defined herein, and The Bank of New York, as Indenture
Trustee hereunder.
RECITALS
WHEREAS, capitalized terms used herein shall have the respective meanings
set forth or referred to in Article I hereof;
WHEREAS, the Owner Participant and the Trust Company entered into the
Original Trust Agreement whereby, among other things, the Owner Trustee declared
a certain trust for the use and benefit of the Owner Participant, subject,
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however, to the Lien of the Original Indenture;
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WHEREAS, the Owner Trustee and the Original Indenture Trustee are parties
to the Original Indenture pursuant to which the Owner Trustee issued to the
Interim Refinancing Loan Participant the Interim Refinancing Loan Certificate as
evidence of the loan made by the Interim Refinancing Loan Participant to the
Owner Trustee;
WHEREAS, the Original Indenture was recorded by the FAA as described in
Annex I hereto;
WHEREAS, The Bank of New York, a New York banking corporation, acquired the
corporate trust businesses of NationsBank of Georgia, National Association, and
NationsBank of South Carolina, National Association, as of December 4, 1995,
whereupon it became the successor Indenture Trustee and Pass Through Trustee in
accordance with the terms of the Original Indenture and the Pass Through
Agreement;
WHEREAS, pursuant to Section 20 of the Original Participation Agreement,
the parties hereto desire to prepay the Interim Refinancing Loan Certificate
with the proceeds of the Certificates to be issued hereunder;
WHEREAS, in connection with the refinancing of the Interim Refinancing Loan
Certificate, the parties hereto desire to amend and restate the Original
Indenture in its entirety as this Indenture sets forth, in order to provide,
among other things, (i) for the issuance by the Owner Trustee of the
Certificates which collectively evidence the debt financing by the Holders of
the Owner Trustee's payment of Lessor's Cost, as provided in the Participation
Agreement and (ii) for the assignment, mortgage and
pledge by the Owner Trustee to the Indenture Trustee, as part of the Indenture
Estate hereunder, among other things, of all of the Owner Trustee's right, title
and interest in and to the Aircraft and the Indenture Documents and all payments
and other amounts received hereunder or thereunder in accordance with the terms
hereof (other than Excepted Payments), as security for, among other things, the
Owner Trustee's obligations to the Holders and for the ratable benefit and
security of such Holders;
WHEREAS, the Owner Participant and the Trust Company, prior to the
execution and delivery of this Indenture, entered into the Trust Agreement
whereby the Original Trust Agreement was amended and restated and pursuant to
which, among other things, the Owner Trustee is authorized and directed to
execute and deliver this Indenture;
WHEREAS, all things have been done to make the Certificates, when executed
by the Owner Trustee, and authenticated and delivered by the Indenture Trustee
hereunder, the valid obligations of the Owner Trustee; and
WHEREAS, all things necessary to make this Indenture the valid, binding and
legal obligation of the Owner Trustee, enforceable in accordance with its terms,
have been done and performed and have happened.
NOW, THEREFORE, the parties agree that such Original Indenture be and the
same is hereby amended and restated to read in its entirety as follows:
GRANTING CLAUSE
NOW, THEREFORE, THIS TRUST INDENTURE AND SECURITY AGREEMENT WITNESSETH,
that, to secure the prompt payment of the principal of and premium (if any) and
interest on, and all other amounts due with respect to, all Certificates from
time to time outstanding hereunder and the performance and observance by the
Owner Trustee of all the agreements, covenants and provisions for the benefit of
the Holders or the Indenture Trustee contained herein and in the Participation
Agreement and the Certificates, and the prompt payment of any and all amounts
from time to time owing under the Participation Agreement by the Owner Trustee,
the Owner Participant or the Lessee to the Holders or the Indenture Trustee and
for the uses and purposes and subject to the terms and provisions hereof, and in
consideration of the premises and of the covenants herein contained, and of the
acceptance of the Certificates by the Holders thereof, and of the sum of $1 paid
to the Owner Trustee by the Indenture Trustee at or before the delivery hereof,
the receipt whereof is hereby acknowledged, the Owner Trustee has granted,
bargained, sold, assigned, transferred, conveyed, mortgaged, pledged and
confirmed, and does hereby grant, bargain, sell, assign, transfer, convey,
mortgage, pledge and confirm, unto the Indenture Trustee, its successors and
assigns, for the security and benefit of the Holders, from time to time, of
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Certificates, a first priority security interest in and first mortgage lien on
all estate, right, title and interest of the Owner Trustee in, to and under the
following described property, rights and privileges, other than Excepted
Payments (which collectively, excluding Excepted Payments but including all
property hereafter specifically subjected to the Lien of this Indenture by a
Trust Agreement and Trust Indenture Supplement or any other mortgage
supplemental hereto, are included within the Indenture Estate) and subject
always to the rights of the Owner Trustee and the Owner Participant under
Article VIII hereof and to the other terms and conditions of this Indenture, to
wit:
1. The Aircraft (including the Airframe and the Engines) and all
replacements thereof and substitutions therefor to which the Owner Trustee
shall from time to time acquire title as provided herein and in the Lease,
all as more particularly described in the Trust Agreement and Trust
Indenture Supplement executed and delivered with respect to the Aircraft or
any such replacements or substitutions therefor, as provided in this
Indenture;
2. The Lease and all Rent thereunder, including, without limitation,
all amounts of Basic Rent and Supplemental Rent, and payments of any kind
thereunder and including all rights of the Owner Trustee to execute any
election or option or to give any notice, consent, waiver, or approval
under or in respect of the Lease or to accept any surrender of the Aircraft
or any part thereof as well as any rights, powers or remedies on the part
of the Owner Trustee, whether arising under the Lease or by statute or at
law or in equity or otherwise arising out of any Lease Default or Lease
Event of Default;
3. The Purchase Agreement, the Purchase Agreement Assignment, the
Consent and Agreement, the Engine Consent and Agreement, and the Bills of
Sale and the Manufacturer's warranty bill of sale referred to in Section 2
of the Purchase Agreement Assignment and any sublease at any time assigned
to the Owner Trustee pursuant to Section 7(b) of the Lease;
4. All rents, issues, profits, revenues and other income of the
property subjected or required to be subjected to the Lien of this
Indenture;
5. All insurance and requisition proceeds with respect to the
Aircraft, including but not limited to the insurance required under Section
11 of the Lease;
6. All amounts from time to time deposited with the Indenture
Trustee as security for the Lessee's obligations under the Lease and the
Participation Agreement; and
7. All proceeds of the foregoing.
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The Owner Trustee has previously delivered to the Indenture Trustee the
sole original executed counterpart of the Original Lease (which contains a
chattel paper receipt), and concurrently with the delivery of this Indenture,
the Owner Trustee is delivering to the Indenture Trustee the sole original
executed counterpart of the Lease which contains a chattel paper receipt,
together with an executed copy of the Trust Agreement.
HABENDUM CLAUSE
TO HAVE AND TO HOLD all and singular the aforesaid property unto the
Indenture Trustee, its successors and assigns, in trust, for the benefit and
security of the Holders, from time to time, of the Certificates without (except
as expressly provided herein) any priority of any one Certificate over any
other, and for the uses and purposes and subject to the terms and provisions set
forth in this Indenture.
It is expressly agreed that anything herein contained to the contrary
notwithstanding, the Owner Trustee shall remain liable under the Indenture
Documents to perform all of the obligations assumed by it thereunder, all in
accordance with and pursuant to the terms and provisions thereof, and the
Indenture Trustee and the Holders shall have no obligation or liability under
any thereof by reason of or arising out of the assignment hereunder, nor shall
the Indenture Trustee or any of the Holders be required or obligated in any
manner to perform or fulfill any obligations of the Owner Trustee under or
pursuant to any of the Indenture Documents or, except as herein expressly
provided, to make any payment, or to make any inquiry as to the nature or
sufficiency of any payment received by it, or present or file any claim, or take
any action to collect or enforce the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
Subject to the terms hereof, the Owner Trustee does hereby appoint and
constitute the Indenture Trustee the true and lawful attorney of the Owner
Trustee, irrevocably, with full power (in the name of the Owner Trustee or
otherwise) to ask, require, demand, receive and give acquittance for any and all
moneys and claims for moneys (in each case including insurance and requisition
proceeds) due and to become due under or arising out of the Indenture Documents
(other than Excepted Payments) and all other property which now or hereafter
constitutes part of the Indenture Estate, to endorse any checks or other
instruments or orders in connection therewith and to file any claims or to take
any action or to institute any proceedings which the Indenture Trustee may deem
to be necessary or advisable in the premises. Under the Lease, the Lessee is
directed to make all payments of Rent (other than Excepted Payments) and all
other amounts which are required to be paid to or deposited with the Owner
Trustee pursuant to the Lease (other than Excepted Payments) directly to the
Indenture Trustee at such address or addresses as the Indenture Trustee shall
specify, for application as provided in
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this Indenture. So long as this Indenture shall remain in effect and shall not
have been terminated pursuant to Section 14.01 hereof, the Owner Trustee agrees
that promptly on receipt thereof, it will transfer to the Indenture Trustee any
and all moneys from time to time received by it constituting part of the
Indenture Estate, for distribution by the Indenture Trustee pursuant to this
Indenture, except that the Owner Trustee shall accept for distribution pursuant
to the Trust Agreement any amounts distributed to it by the Indenture Trustee
under this Indenture.
The Owner Trustee agrees that at any time and from time to time, upon the
written request of the Indenture Trustee, the Owner Trustee will promptly and
duly execute and deliver or cause to be duly executed and delivered any and all
such further instruments and documents as the Indenture Trustee may reasonably
deem desirable in obtaining the full benefits of the assignment hereunder and of
the rights and powers granted herein.
The Owner Trustee does hereby warrant and represent that it has not
assigned or pledged, and hereby covenants that it will not assign or pledge, so
long as this Indenture shall remain in effect and shall not have been terminated
pursuant to Section 14.01 hereof, any of its estate, right, title or interest
hereby assigned, to anyone other than the Indenture Trustee, and that, with
respect to such right, title and interest hereby assigned, the Owner Trustee
will not, except as provided in this Indenture or with respect to Excepted
Payments, (i) accept or retain any payment from the Lessee under any Indenture
Document, enter into any agreement amending or supplementing any of the
Indenture Documents, or execute any waiver or modification of, or consent under,
the terms of any of the Indenture Documents, (ii) settle or compromise any claim
arising under any of the Indenture Documents or (iii) submit or consent to the
submission of any dispute, difference or other matter arising under or in
respect of any of the Indenture Documents to arbitration thereunder. For
purposes of Section 7.01(e) hereof, this is the fourth paragraph following the
Habendum Clause.
The Owner Trustee hereby ratifies and confirms the Lease and hereby agrees
that, unless otherwise permitted or required hereunder, it will not take any
action prohibited, or omit to take any action required, by any Indenture
Document, the taking or omission of which might result in an alteration or
impairment of any of the Indenture Documents or any of the rights or obligations
created by any thereof or the assignment hereunder.
Notwithstanding the Granting Clause or any of the preceding paragraphs,
there is hereby expressly excluded from the foregoing grant, bargain, sale,
assignment, transfer, conveyance, mortgage, pledge, security interest and
mortgage all Excepted Payments. Further, nothing in the Granting Clause or any
of the preceding paragraphs shall impair in any respect the rights of the Owner
Trustee or the Owner Participant under Article VIII hereof.
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IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as
follows:
ARTICLE I
DEFINITIONS
The following terms (except as otherwise expressly provided or unless the
context otherwise clearly requires) for all purposes of this Indenture and of
any indenture supplemental hereto have the respective meanings specified in this
Section. All accounting terms used and not expressly defined herein have the
meanings given to them in accordance with generally accepted accounting
principles, and the term "generally accepted accounting principles" means such
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accounting principles which are generally accepted in the United States at the
date or time of any computation or otherwise at the date hereof. The words
"herein", "hereof" and "hereunder" and other words of similar import refer to
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this Indenture as a whole and not to any particular Article, Section or other
subdivision. The terms defined in this Article include the plural as well as the
singular. For all purposes of this Indenture, capitalized terms used but not
defined herein have the respective meanings assigned thereto in the Lease or, if
not defined therein, in the Participation Agreement.
"Business Day" means any day other than Saturday, Sunday or other day on
------------
which banking institutions in the States of New York, Georgia, or Delaware are
authorized or required by law to close.
"Certificate" or "Certificates" means any Equipment Trust Certificate
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(Delta 1994-1).
"Corporate Trust Office" means the corporate trust office of the Indenture
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Trustee located at 101 Barclay Street, New York, New York 10286, or such other
office in the United States at which the Indenture Trustee's corporate trust
business shall be administered that the Indenture Trustee shall have specified
by notice in writing to the Lessee, the Owner Trustee, the Owner Participant and
the Holders.
"Dollars" and "$" mean lawful currency of the United States of America.
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"EBO Percentage" has the meaning specified in the Participation Agreement.
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"Equipment Trust Certificates (Delta 1994-1)" means Certificates issued by
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the Owner Trustee and authenticated and delivered by the Indenture Trustee
pursuant to the terms of this Indenture and any Certificate issued in exchange
therefor or replacement thereof pursuant hereto.
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"Excepted Payments" means (i) indemnity payments and interest thereon paid
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or payable by the Lessee to the Owner Participant, the Trust Company or their
successors, assigns, directors, officers, agents, representatives and servants
pursuant to Section 6 of the Participation Agreement or pursuant to the
Indemnity Agreement, (ii) proceeds of public liability insurance (or proceeds of
governmental indemnities in lieu thereof) in respect of all or any part of the
Aircraft or the use and operation thereof paid or payable as a result of
insurance claims made, or losses suffered, by the Trust Company or the Indenture
Trustee in their respective individual capacities or by the Owner Participant or
their successors, assigns, directors, officers, agents, representatives and
servants, (iii) proceeds of insurance (or proceeds of governmental indemnities
in lieu thereof) maintained in respect of the Aircraft by or for the benefit of
the Owner Participant (either by the Owner Participant directly or through the
Owner Trustee) and not maintained by Lessee under, or maintained in satisfaction
of Lessee's obligations under, Section 11 of the Lease, (iv) payments of
Supplemental Rent by the Lessee in respect of any amounts paid or payable to the
Owner Participant or the Trust Company under Section 14 of the Participation
Agreement, (v) payments to the Owner Participant by the Owner Trustee pursuant
to Section 2(b)(iii) of the Original Participation Agreement or payments to the
Owner Participant pursuant to Section 1(b) of the Participation Agreement and
(vi) any right of the Owner Participant or any other Person specified in clause
(i) above to demand, collect, sue for or otherwise receive and enforce the
payment of any amount described in clauses (i) through (v) above (including
interest thereon to the extent provided in the applicable provisions of the
Operative Documents) and the proceeds thereof (provided, however, that the
rights under this clause (vi) shall not include the right to exercise any
remedies under the Lease, other than to the extent provided for in Section 8.01
hereof).
"Government Obligations" means direct obligations of the United States of
----------------------
America which are not callable, redeemable or payable prior to maturity, in
whole or in part, directly or indirectly, by any Person.
"Holder" means the registered holder of any Certificate as evidenced on the
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Register.
"Indebtedness" of any Person means at any time, without duplication, (i)
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all obligations of such Person for borrowed money or the deferred purchase price
of property, or evidenced by bonds, debentures, notes or other similar
instruments, or arising under leases that are properly capitalized under
generally accepted accounting principles applicable to such Person and (ii) all
guarantees by such Person of such obligations described in clause (i) above of
third parties.
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"Indenture", "this Indenture" and other like words mean this Trust
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Indenture and Security Agreement as the same may be modified, supplemented,
restated or amended from time to time in accordance with the provisions hereof
and of the Participation Agreement (including, without limitation, as
supplemented by each Trust Agreement and Trust Indenture Supplement).
"Indenture Default" means an Indenture Event of Default or an event or
-----------------
condition that, with the giving of notice or the lapse of time or both, would
become an Indenture Event of Default.
"Indenture Documents" means the Participation Agreement, the Trust
-------------------
Agreement (including any Trust Agreement and Trust Indenture Supplements), the
Lease (including any Lease Supplements), this Indenture (including any Trust
Agreement and Trust Indenture Supplements), the Certificates, the Purchase
Agreement, the Manufacturer's warranty bills of sale referred to in Section 2 of
the Purchase Agreement Assignment, the Purchase Agreement Assignment, the Bills
of Sale, the Consent and Agreement and the Engine Consent and Agreement.
"Indenture Estate" means all estate, right, title and interest of the
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Indenture Trustee in and to any and all of the properties, rights and interests
referred to in the Granting Clause of this Indenture, excluding, however, in
each case, Excepted Payments.
"Indenture Event of Default" has the meaning specified in Section 7.01
--------------------------
hereof.
"Indenture Trustee" means The Bank of New York, a New York banking
-----------------
corporation, in its capacity as Indenture Trustee under this Indenture, and its
successors and assigns as Indenture Trustee hereunder.
"Independent Investment Banker" means an independent investment banking
-----------------------------
institution of national standing appointed by the Lessee on behalf of the Owner
Trustee that is independent in fact, does not have any direct financial
interest, or any material indirect financial interest, in the Lessee or any
Affiliate of the Lessee, and is not connected with the Lessee or any Affiliate
of the Lessee as an officer, employee, promoter, underwriter, trustee, partner,
director or Person performing similar functions; provided, that if the Indenture
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Trustee shall not have received written notice of such an appointment at least
10 days prior to the Redemption Date or if a Lease Payment Default, Lease
Bankruptcy Default or Lease Event of Default shall have occurred and be
continuing, "Independent Investment Banker" shall mean such an institution
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appointed by the Indenture Trustee.
"Interest Payment Date" means each April 11 and October 11 beginning with
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April 11, 1996.
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"Interim Refinancing Loan Certificate" means the Loan Certificate in the
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initial outstanding principal amount of $79,600,000 issued to the Interim
Refinancing Loan Participant pursuant to the Original Indenture.
"Interim Refinancing Loan Participant" means The Mitsubishi Trust and
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Banking Corporation, New York Branch, its successors and permitted assigns.
"Lease" means the Lease Agreement (Delta 1994-1) dated as of April 1, 1994,
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as amended and restated as of March 1, 1996, between the Owner Trustee and the
Lessee, as amended or supplemented from time to time, including as supplemented
by the Lease Supplement.
"Lease Bankruptcy Default" means any event specified in Section 14(f),
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14(g) or 14(h) of the Lease which with the giving of notice or lapse of time or
both would constitute a Lease Event of Default.
"Lease Default" means any event or condition defined as a "Default" under
-------------
the Lease.
"Lease Event of Default" means any event or condition defined as an "Event
----------------------
of Default" in Section 14 of the Lease.
"Lease Payment Default" means an event which with the giving of notice or
---------------------
lapse of time or both would constitute an Event of Default as specified in
Section 14(a) or 14(b) of the Lease.
"Lessee" means Delta Air Lines, Inc., a Delaware corporation, and its
------
successors and, to the extent permitted by the Participation Agreement, its
assigns thereunder.
"Lessor" means the Owner Trustee as lessor under the Lease.
------
"Lien" means any mortgage, pledge, lien, charge, claims, disposition of
----
title, encumbrance, lease or security interest.
"Majority in Interest of Certificate Holders" means, as of a particular
-------------------------------------------
date of determination, the Holder or Holders of more than 50% in aggregate
unpaid principal amount of all Outstanding Certificates as of such date
(excluding any Certificates held by the Owner Trustee, the Owner Participant, or
the Lessee, or any Affiliate of any thereof, or any interests of the Owner
Participant therein by reason of subrogation pursuant to Section 8.03 of this
Indenture (unless all Certificates then Outstanding shall be held by the Owner
Trustee or the Owner Participant or the Lessee or any Affiliate of any
thereof)).
"Maturity" means, with respect to any Certificate, __________ or
--------
____________ as the case may be.
- 9 -
"Officers' Certificate" means a certificate signed by a Responsible Officer
---------------------
of the Owner Trustee or the Lessee, as the case may be, delivered to the
Indenture Trustee. Each such certificate shall include the statements provided
for in Section 15.07.
"Opinion of Counsel" means a written opinion of legal counsel, who in the
------------------
case of counsel (a) for the Lessee may be (i) an attorney employed by the Lessee
who is generally empowered to deliver such written opinions, (ii) King &
Spalding or a successor firm or (iii) other counsel designated by the Lessee and
reasonably satisfactory to the Indenture Trustee and (b) for the Owner Trustee,
may be (i) Potter Anderson & Corroon or (ii) other counsel designated by the
Owner Trustee and reasonably satisfactory to the Indenture Trustee.
"Original Indenture" means the Trust Indenture and Security Agreement
------------------
(Delta 1994-1) between the Owner Trustee and the Original Indenture Trustee, as
it was originally executed as of April 1, 1994 and delivered by the parties
thereto, as amended and supplemented as described in Annex I hereto.
"Original Indenture Trustee" means NationsBank of Georgia, National
--------------------------
Association.
"Original Lease" means the Lease Agreement (Delta 1994-1) between the
--------------
Lessor and the Lessee, as it was originally executed as of April 1, 1994 and
delivered by the parties thereto, as amended and supplemented as described in
Annex I hereto.
"Original Participation Agreement" means the Participation Agreement (Delta
--------------------------------
1994-1) as originally executed as of April 1, 1994 and delivered by the parties
thereto, as amended by Amendment No. 1 to Participation Agreement (Delta 1994-1)
dated as of March 28, 1995.
"Original Trust Agreement" means the Trust Agreement (Delta 1994-1) between
------------------------
the Trust Company and the Owner Participant as originally executed as of April
1, 1994, and filed with the FAA on April 12, 1994, as supplemented by the Trust
Agreement and Trust Indenture Supplement.
"Outstanding" means, when used with respect to Certificates, as of the date
-----------
of determination and subject to the provisions of Section 10.04 hereof, all
Certificates theretofore executed and delivered under this Indenture, with the
exception of the following:
(i) Certificates theretofore cancelled by the Indenture Trustee or
delivered to the Indenture Trustee for cancellation pursuant to Section
2.08 of this Indenture or otherwise;
- 10 -
(ii) Certificates for which payment or redemption money in the
necessary amount has been theretofore deposited with the Indenture Trustee
in trust for the Holders of such Certificates pursuant to Section 14.01
hereof; provided, that if such Certificates are to be redeemed, notice of
such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Indenture Trustee has been made; and
(iii) Certificates in exchange for or in lieu of which other
Certificates have been executed, authenticated and delivered pursuant to
Article II hereof.
"Owner Participant" means the Person who executed the Original
-----------------
Participation Agreement as the Owner Participant, and also includes any Person
to which such Person (or any successor or permitted assignee) transfers its
right, title and interest in and to the Trust Estate in accordance with Section
16 of the Participation Agreement and Section 9.01 of the Trust Agreement.
"Owner Trustee" means Wilmington Trust Company, a Delaware banking
-------------
corporation, not in its individual capacity but solely as Owner Trustee under
the Trust Agreement, and its successors and assigns as trustee thereunder.
"Participation Agreement" means the Participation Agreement (Delta 1994-1)
-----------------------
dated as of April 1, 1994, as amended and restated as of March 1, 1996, among
the Lessee, the Owner Participant, the Owner Trustee, the Pass Through Trustee
and the Indenture Trustee, as the same may be modified, supplemented or amended
from time to time in accordance with the provisions thereof and hereof.
"Pass Through Agreement" means the Pass Through Trust Agreement dated as of
----------------------
August 1, 1992, between the Lessee and the Pass Through Trustee, as such Pass
Through Agreement may be modified, supplemented or amended from time to time in
accordance with the provisions thereof.
"Pass Through Trustee" means The Bank of New York, a New York banking
--------------------
corporation, in its capacity as Pass Through Trustee under the Pass Through
Agreement and each Pass Through Trust, and its successors and assigns as Pass
Through Trustee thereunder.
"Paying Agent" has the meaning set forth in Section 3.04 hereof.
------------
"Person" means any individual, corporation, partnership, joint venture,
------
association, joint-stock company, trust, nonincorporated organization or
government or any agency or political subdivision thereof.
"Record Date" means, as used with respect to any Interest Payment Date
-----------
(except a date for payment for defaulted interest), March 27 for the April 11
Interest Payment Dates and September 26
- 11 -
for the October 11 Interest Payment Dates, whether or not such date is a
Business Day.
"Redemption Amount" means, with respect to each Certificate to be redeemed
-----------------
or purchased pursuant to Sections 6.02(B), 6.02(C) (with respect to Section
8.02(a)(i)), 6.02(D), 6.02(E) or 8.02(a)(i) hereof, an amount determined as of
the day before the applicable Redemption Date which an Independent Investment
Banker determines to be equal to the greater of (i) the unpaid principal amount
of such Certificate and (ii) the present value (computed in accordance with
generally accepted accounting principles on a semiannual basis at a discount
rate equal to the Treasury Yield) of (A) the payments of interest on such
Certificate as required by the terms thereof and of this Indenture which have
not been paid (whether or not then due) and which are not payable in connection
with such redemption or purchase of the Certificates and (B) the remaining
mandatory sinking fund redemption payments of principal on such Certificate
including the payment due at the Maturity thereof. The excess, if any, of the
amount referred to in clause (ii) of this definition over the amount referred to
in clause (i) shall constitute a premium and shall be deemed such in all places
in the Indenture Documents that refer to a "premium" payable with respect to any
Certificates.
"Redemption Date" means (i) in the case of a redemption of the Certificates
---------------
pursuant to clause (A) of Section 6.02 hereof, the date on which payment is made
pursuant to Section 10(a)(i) of the Lease; (ii) in the case of a redemption of
the Certificates pursuant to clause (D) of said Section 6.02, the date of
termination of the Lease (including without limitation a Termination Date
pursuant to Section 9(a) thereof) or with respect to clauses (B) and (E) of said
Section 6.02 a date specified by the Owner Trustee at the direction of the
Lessee; and (iii) in the case of a redemption or purchase of the Certificates
pursuant to Section 8.02(a), the date designated by the Owner Trustee as the
Redemption Date in the notice to the Indenture Trustee of the Owner
Participant's election to redeem or purchase the Certificates.
"Redemption Price" means the price at which the Certificates are redeemable
----------------
or purchasable on the Redemption Date pursuant to Section 6.02 hereof, provided,
--------
that in the case of a redemption or purchase pursuant to clause (B), clause (C)
(with respect to Section 8.02(a)(i)), clause (D) or clause (E) of Section 6.02
or pursuant to Section 8.02(a)(i), references to the "Redemption Price" on any
date prior to the final determination of the Redemption Amount means an amount
equal to the aggregate unpaid principal amount of the Certificates plus interest
thereon accrued to but excluding the Redemption Date plus the amount, if any,
that the Independent Investment Banker, on the first Business Day immediately
preceding the date on which notice of redemption or purchase is mailed to the
Holders pursuant to Section 6.03 hereof estimates may be necessary to pay the
portion of the Redemption Amount constituting a premium using the same procedure
for
- 12 -
estimating the Redemption Amount as would be used for calculating the Redemption
Amount.
"Register" has the meaning set forth in Section 3.02 hereof.
--------
"Registrar" has the meaning set forth in Section 3.02 hereof.
---------
"Remaining Weighted Average Life" shall mean, for any Certificate, as of
-------------------------------
any determination date, the number of years obtained by dividing (a) the sum of
the products obtained by multiplying (i) the amount of each then remaining
mandatory sinking fund redemption payment of principal, including the payment
due on the Maturity of such Certificate, by (ii) the number of years (calculated
to the nearest one-twelfth) which will elapse between such determination date,
and the date on which such mandatory sinking fund redemption payment is
scheduled to be made, by (b) the then outstanding principal amount of such
Certificate.
"Rent" has the meaning specified in the Lease.
----
"Rent Payment Date" means any "Payment Date" under and as defined in the
-----------------
Lease.
"Replacement Airframe" means any airframe substituted for an Airframe
--------------------
pursuant to Section 9.08 hereof.
"Replacement Engine" means any engine substituted for an Engine pursuant to
------------------
Section 9.08 hereof.
"Responsible Officer" means, with respect to any Person other than the
-------------------
Indenture Trustee or the Owner Trustee, the president or any other officer of
such Person with authority of at least a vice president; or, in the case of the
Indenture Trustee, an officer or assistant officer of the Indenture Trustee in
its Corporate Trust Lease Administration department; or, in the case of the
Owner Trustee, an officer of the Owner Trustee in its Corporate Trust
Administration department.
"Securities Act" means the Securities Act of 1933, as amended.
--------------
"Treasury Yield" means, with respect to the Redemption Amount of a
--------------
Certificate to be redeemed or purchased pursuant to clause (B), clause (D) or
clause (E) of Section 6.02 hereof or pursuant to Section 8.02(a)(i) hereof, (i)
in the case of a Certificate having a Maturity within one year after the
applicable Redemption Date, the average yield to maturity on a government bond
equivalent basis of the applicable United States Treasury Bill due the week of
Maturity of such Certificate and (ii) in the case of a Certificate having a
Maturity one year or more after the applicable Redemption Date, the average
yield of the most actively traded United States Treasury Note (as reported by
Cantor Fitzgerald Securities Corp. on page 5 of Telerate Systems, Inc., a
financial news service, or if such report is not available, a
- 13 -
source deemed comparable by the Independent Investment Banker selected to
determine the Redemption Amount and reasonably acceptable to the Lessee)
corresponding in maturity to the Remaining Weighted Average Life of such
Certificate (or if there is no maturity corresponding to such Remaining Weighted
Average Life, an interpolation of maturities by the Independent Investment
Banker), in each case determined by the Independent Investment Banker selected
to determine the Redemption Amount based on the bid prices as of 10:00 a.m. and
2:00 p.m., New York time, on the second Business Day preceding the Redemption
Date.
"Trust Agreement" means the Trust Agreement (Delta 1994-1) dated as of
---------------
April 1, 1994, as amended and restated as of March 1, 1996, between the Owner
Participant and the Trust Company, as the same may be modified, supplemented or
amended from time to time in accordance with the provisions thereof, hereof and
of the Participation Agreement.
"Trust Agreement and Trust Indenture Supplement" or "Trust Agreement
---------------------------------------------- ---------------
Supplement" means the Trust Agreement and Trust Indenture Supplement (Delta
- ----------
1994-1) dated April 12, 1994 (which is incorporated by reference herein), as
such Trust Agreement and Trust Indenture Supplement shall be amended or
supplemented from time to time and any other supplement to the Trust Agreement
and to this Indenture, substantially in the form of Exhibit A to the Original
Indenture, which shall particularly describe any Replacement Airframe and/or
Replacement Engine included in the Trust Estate and the Indenture Estate.
"Trust Company" means Wilmington Trust Company, a Delaware banking
-------------
corporation, in its individual capacity and not as Owner Trustee, and its
successors under the Trust Agreement, in their respective individual capacities
and not as Owner Trustees.
ARTICLE II
ISSUE, EXECUTION, FORM AND
REGISTRATION OF CERTIFICATES
SECTION 2.01. Authentication and Delivery of Certificates. On the
-------------------------------------------
Refunding Date pursuant to Section 2 of the Participation Agreement, and from
time to time thereafter, Certificates in an aggregate principal amount not in
excess of the amount specified in Section 2.04 shall be executed by the Owner
Trustee and delivered to the Indenture Trustee for authentication, and the
Indenture Trustee shall thereupon authenticate and deliver said Certificates to
or upon the oral or written order of the Owner Trustee, signed, if written, by
an authorized officer of the Owner Trustee, without any further action by the
Owner Trustee.
SECTION 2.02. Execution of Certificates. The Certificates shall be signed
-------------------------
on behalf of the Owner Trustee by an authorized officer of the Owner Trustee.
Such signatures may be the manual
- 14 -
or facsimile signatures of such officer and minor errors or defects in any
reproduction of any such signature shall not affect the validity or
enforceability of any Certificate which has been duly authenticated and
delivered by the Indenture Trustee.
In case any officer of the Owner Trustee who shall have signed any of the
Certificates shall cease to be such officer before the Certificate so signed
shall be authenticated and delivered by the Indenture Trustee or disposed of by
the Owner Trustee, such Certificate nevertheless may be authenticated and
delivered or disposed of as though the person who signed such Certificate had
not ceased to be such officer of the Owner Trustee; and any Certificate may be
signed on behalf of the Owner Trustee by such person or persons as, at the
actual date of the execution of such Certificate, shall be the proper officers
of the Owner Trustee, although at the date of the execution and delivery of this
Indenture any such person was not such officer.
SECTION 2.03. Certificate of Authentication. Only such Certificates as
-----------------------------
shall bear thereon a certificate of authentication substantially in the form set
forth in Exhibit B, executed by the Indenture Trustee by manual signature of one
of its authorized officers, shall be entitled to the security and benefits of
this Indenture or be valid or obligatory for any purpose. Such certificate by
the Indenture Trustee upon any Certificate executed by the Owner Trustee shall
be conclusive evidence that the Certificate so authenticated has been duly
authenticated and delivered hereunder and that the Holder, as evidenced on the
Register, is entitled to the security and benefits of this Indenture.
SECTION 2.04. Form and Terms of Certificates; Payments of Principal,
------------------------------------------------------
Premium and Interest. The Certificates and the Indenture Trustee's certificate
- --------------------
of authentication shall be substantially in the form set forth in Exhibit B
hereto. The Certificates shall be issuable as registered securities without
coupons and shall be numbered, lettered, or otherwise distinguished in such
manner or in accordance with such plans as the Owner Trustee executing the same
may determine with the approval of the Indenture Trustee.
The aggregate principal amount of Certificates that may be authenticated
and delivered under this Indenture, and which may at any time be Outstanding, is
limited as provided in the form of Certificate attached as Exhibit B hereto. The
Certificates shall be issued in registered form only and in denominations of
$1,000 and any integral multiple thereof, shall be dated the date of their
authentication, and shall be issued in the Maturities and principal amounts, and
shall bear interest at the rates per annum, specified in the form of Certificate
set forth in Exhibit B.
Any of the Certificates may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends,
- 15 -
not inconsistent with the provisions of this Indenture, as may be required to
comply with any law or with any rules or regulations pursuant thereto, or with
the rules of any securities market in which the Certificates are admitted to
trading, or to conform to general usage.
Each Certificate shall bear interest from the date of issuance thereof or
from the most recent date to which interest has been paid and duly provided for,
as the case may be, which shall be payable on the dates specified on the face of
the form of Certificate set forth in Exhibit B hereto until the principal
thereof is paid or made available for payment in accordance herewith. Interest
shall be calculated on the basis of a 360-day year of twelve 30-day months.
The principal of, and premium (if any) and interest on, the Certificates
shall be payable at the Corporate Trust Office of the Indenture Trustee or at
any office or agency maintained for such purpose pursuant to Section 3.02
hereof; provided, however, that interest may be payable at the option of the
-------- -------
Indenture Trustee or its Paying Agent by mailing checks for such interest
payable to or upon the written order of the Holders entitled thereto as they
shall appear on the Register; provided further, however, that notwithstanding
-------- ------- -------
the foregoing to the contrary, interest payable with respect to Certificates as
to which the Pass Through Trustee is the Holder shall be sent by wire transfer
of immediately available funds to an account or accounts in the United States
previously specified by the Pass Through Trustee to the Indenture Trustee.
The Holder at the close of business on any Record Date with respect to any
Interest Payment Date shall be entitled to receive the interest, if any, payable
on such Interest Payment Date notwithstanding any transfer or exchange of such
Certificate subsequent to the Record Date and prior to such Interest Payment
Date, except if and to the extent the Owner Trustee shall default in the payment
of the interest due on such Interest Payment Date, in which case such defaulted
interest shall be paid to the Holder at the close of business on a subsequent
Record Date (which shall be not less than five or more than fifteen Business
Days prior to the date of payment of such defaulted interest) established by
notice given by mail by or on behalf of the Owner Trustee to the Holders not
less than 15 days preceding such subsequent Record Date.
SECTION 2.05. Payments from Indenture Estate Only. All payments to be
------------------------------------
made by the Owner Trustee under this Indenture shall be made only from the
income and the proceeds from the Trust Estate to the extent included in the
Indenture Estate and only to the extent that the Owner Trustee shall have
sufficient income or proceeds from the Trust Estate to the extent included in
the Indenture Estate to enable the Indenture Trustee to make distributions of
the amounts due in respect of the Certificates in accordance with the terms
hereof and thereof; provided that under
--------
- 16 -
the Lease, the Lessee is obligated to pay or cause to be paid, to the extent
such payments are not required to be made from the assets subject to the Lien of
this Indenture or the income and proceeds received by the Indenture Trustee
therefrom, any net loss arising from the investment of funds held by the
Indenture Trustee which but for a Lease Payment Default, Lease Bankruptcy
Default or Lease Event of Default would be payable to Lessee. Each Holder by its
acceptance of a Certificate agrees that it will look solely to the income and
proceeds from the Indenture Estate to the extent available for distribution to
it as provided herein and that neither the Owner Participant, the Owner Trustee,
the Trust Company nor the Indenture Trustee is personally liable to such Holder
for any amounts payable under this Indenture or such Certificate or for any
amounts payable or liability under any Certificate or this Indenture, except as
expressly provided herein in the case of the Trust Company, the Owner Trustee or
the Indenture Trustee, or in the case of the Owner Participant, except as
expressly provided in the Participation Agreement.
The Trust Company is not personally liable to any Holder, the Lessee, the
Owner Participant or the Indenture Trustee for any amounts payable under this
Indenture or for any liability under this Indenture or the Certificates, except
as a result of the Owner Trustee's gross negligence or willful misconduct, or as
otherwise expressly provided herein, in the Trust Agreement or in the
Participation Agreement.
If (1) all or any part of the Trust Estate becomes the property of a debtor
subject to the reorganization provisions of the Bankruptcy Code, (2) pursuant to
such reorganization provisions, including Section 1111(b) of the Bankruptcy
Code, the Owner Participant is required, by reason of the Trust Company or the
Owner Participant being held to have recourse liability to the Indenture Trustee
or any Holder (other than as contemplated by the Operative Documents), directly
or indirectly, to make payment on account of any amount payable as principal,
premium, interest or other amounts on the Certificates, and (3) the Indenture
Trustee actually receives any Excess Amount, as defined below, which reflects
any payment by the Owner Participant on account of (2) above, then the Indenture
Trustee, to the extent permitted by applicable law, shall promptly refund to the
Owner Participant such Excess Amount. The Indenture Trustee hereby waives to the
fullest extent permitted by law the benefit of the provisions of Section 1111(b)
of the Bankruptcy Code with respect to recourse against the Trust Company and
the Owner Participant on account of any amount payable as principal, premium,
interest or other amounts pursuant to the Certificates. For purposes of this
paragraph, "Excess Amount" means the amount by which such payment exceeds the
amount which would have been received by the Indenture Trustee if the Trust
Company or the Owner Participant had not become subject to the recourse
liability referred to in clause (2) above. Nothing contained in this paragraph
shall prevent the Indenture Trustee from enforcing any personal recourse
obligation (and retaining the proceeds thereof) of the Owner Participant
- 17 -
under the Participation Agreement, this Indenture (other than referred to in
clause (2) above) or the Trust Agreement (and any exhibits or annexes thereto),
or from retaining any amount paid by the Owner Participant under Sections 5.01,
8.02 and 8.03 hereof. Nothing contained herein shall be construed as requiring
any Holder to refund any amount distributed to such Holder pursuant to this
Indenture.
SECTION 2.06. Registration, Transfer and Exchange. The Indenture Trustee
-----------------------------------
will keep, on behalf of the Owner Trustee, at each office or agency to be
maintained for the purpose as provided in Section 3.02 a Register or Registers
on which, subject to such reasonable regulations as it may prescribe, it will
register, and will register the transfer of, Certificates as provided in this
Article. Such Register shall be in written form in the English language or in
any other form capable of being converted into such form within a reasonable
time.
Upon due presentation for registration of transfer of any Certificate at
any such office or agency, the Owner Trustee shall execute and the Indenture
Trustee shall authenticate and deliver in the name of the transferee or
transferees a new Certificate or Certificates of the same Maturity and interest
rate and in authorized denominations for an equal aggregate principal amount.
Any Certificate or Certificates may be exchanged for a Certificate or
Certificates of the same Maturity and interest rate but in other authorized
denominations, in an equal aggregate principal amount. Certificates to be
exchanged shall be surrendered at any office or agency to be maintained by the
Indenture Trustee for the purpose as provided in Section 3.02, and the Owner
Trustee shall execute and the Indenture Trustee shall authenticate and deliver
in exchange therefor the Certificate or Certificates which the Holder making the
exchange shall be entitled to receive, bearing numbers not contemporaneously or
previously outstanding.
All Certificates presented for registration of transfer, exchange,
redemption or payment shall (if so required by the Owner Trustee or the
Indenture Trustee) be duly endorsed by, or be accompanied by a written
instrument or instruments of transfer in form satisfactory to the Owner Trustee
and the Indenture Trustee duly executed by, the Holder or its attorney duly
authorized in writing and (except in the case of transfers pursuant to Section
20 of the Participation Agreement) the Indenture Trustee may require evidence
satisfactory to it as to the compliance of any such transfer with the Securities
Act.
The Owner Trustee or the Indenture Trustee may require payment from the
Holder of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any exchange or registration of transfer of
Certificates. No service charge to the Holder shall be made for any such
transaction.
- 18 -
The Indenture Trustee shall not be required to exchange or register a
transfer of, nor shall the Owner Trustee be required to exchange, any
Certificates (a) for a period of 15 days immediately preceding the first mailing
of notice of redemption or purchase of such Certificates or (b) with respect to
which notice of redemption or purchase has been given pursuant to Section 6.03
and such notice has not been revoked.
All Certificates issued upon any transfer or exchange of Certificates shall
be valid obligations of the Owner Trustee, evidencing the same debt, and
entitled to the same security and benefits under this Indenture, as the
Certificates surrendered upon such transfer or exchange.
SECTION 2.07. Mutilated, Defaced, Destroyed, Lost and Stolen Certificates.
-----------------------------------------------------------
In case any temporary or definitive Certificate shall become mutilated, defaced
or be apparently destroyed, lost or stolen, the Owner Trustee shall, at the
written request of the Holder thereof, execute, and upon the oral or written
request of any officer of the Owner Trustee, the Indenture Trustee shall
authenticate and deliver, a new Certificate of like Maturity, payable in the
same principal amount, dated the date of such Certificate, designated as issued
under this Indenture, bearing a number not contemporaneously or previously
outstanding, in exchange and substitution for the mutilated or defaced
Certificate, or in lieu of and substitution for the Certificate so apparently
destroyed, lost or stolen. If the Certificate being replaced has been apparently
destroyed, lost or stolen, the Holder of such Certificate shall furnish to the
Owner Trustee and to the Indenture Trustee and any agent of the Owner Trustee or
the Indenture Trustee such security or indemnity as may be reasonably required
by them to indemnify and defend and to save each of them harmless from issuance
of such substitute Certificate pursuant hereto (in the case of the Pass Through
Trustee, a personal agreement to indemnify shall be sufficient for this purpose)
and, in every case of destruction, loss or theft, evidence to their satisfaction
of the apparent destruction, loss or theft of such Certificate and of the
ownership thereof.
Upon the issuance of any substitute Certificate, the Owner Trustee or the
Indenture Trustee may require payment from the Holder of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the reasonable fees and
expenses of the Indenture Trustee) connected therewith. In case any Certificate
which has matured or is about to mature, or has been called for redemption in
full, shall become mutilated or defaced or be apparently destroyed, lost or
stolen, the Owner Trustee may, instead of issuing a substitute Certificate, pay
or authorize the payment of the same (without surrender thereof except in the
case of a mutilated or defaced Certificate), if, in every case of apparent
destruction, loss or theft, the applicant for such payment shall furnish to the
Owner Trustee and to the Indenture Trustee such security or indemnity as either
of them may
- 19 -
reasonably require to save each of them harmless from all risks relating to such
payment and the applicant shall also furnish to the Owner Trustee and the
Indenture Trustee evidence to their satisfaction of the apparent destruction,
loss or theft of such Certificate and of the ownership thereof.
Every substitute Certificate issued pursuant to the provisions of this
Section by virtue of the fact that any Certificate is apparently destroyed, lost
or stolen shall constitute an original additional contractual obligation of the
Owner Trustee, whether or not the apparently destroyed, lost or stolen
Certificate shall be enforceable at any time by anyone and shall be entitled to
all the security and benefits of (but shall be subject to all the limitations of
rights set forth in) this Indenture equally and proportionately with any and all
other Certificates duly authenticated and delivered hereunder. All Certificates
shall be held and owned upon the express condition that, to the extent permitted
by law, the foregoing provisions are exclusive with respect to the replacement
or payment of mutilated, defaced, or apparently destroyed, lost or stolen
Certificates and shall preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.08. Cancellation of Certificates; Destruction Thereof. All
-------------------------------------------------
Certificates surrendered for payment, redemption, registration of transfer or
exchange, if surrendered to the Indenture Trustee, or if surrendered to the
Owner Trustee or any agent of the Owner Trustee or the Indenture Trustee, shall
be delivered to the Indenture Trustee for cancellation and shall be cancelled by
it; and no Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Indenture. The Indenture Trustee
shall destroy cancelled Certificates held by it and deliver a certificate of
destruction to the Owner Trustee. If the Owner Trustee shall acquire any of the
Certificates, such acquisition shall not operate as a redemption or satisfaction
of the indebtedness represented by such Certificates unless and until the same
are delivered to the Indenture Trustee for cancellation.
SECTION 2.09. Temporary Certificates. Pending the preparation of
----------------------
definitive Certificates, the Owner Trustee may execute and, upon the oral or
written request of an officer of the Owner Trustee, the Indenture Trustee shall
authenticate and deliver temporary Certificates (printed, lithographed,
typewritten or otherwise reproduced, in each case in form satisfactory to the
Indenture Trustee). Temporary Certificates shall be issuable as registered
Certificates without coupons, of any authorized denomination, and substantially
in the form of the definitive Certificates but with such omissions, insertions
and variations as may be appropriate for temporary Certificates, all as may be
determined by the Owner Trustee with the concurrence of the
- 20 -
Indenture Trustee. Temporary Certificates may contain such reference to any
provisions of this Indenture as may be appropriate. Every temporary Certificate
shall be executed by the Owner Trustee and, upon the oral or written request of
an authorized officer of the Owner Trustee, be authenticated by the Indenture
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Certificates. Without unreasonable delay the
Owner Trustee shall execute and shall furnish definitive Certificates and
thereupon temporary Certificates shall be surrendered in exchange therefor
without charge at any office or agency to be maintained by the Indenture Trustee
for the purpose pursuant to Section 3.02, and, upon the oral or written request
of an authorized officer of the Owner Trustee, the Indenture Trustee shall
authenticate and deliver in exchange for such temporary Certificates an equal
aggregate principal amount of definitive Certificates of the same Maturities and
interest rates and in authorized denominations. Until so exchanged, temporary
Certificates shall be entitled to the same security and benefits under this
Indenture as definitive Certificates.
SECTION 2.10. Termination of Interest in Indenture Estate. A Holder shall
-------------------------------------------
not, as such, have any further interest in, or other right with respect to, the
Indenture Estate when and if the principal amount of and premium, if any, and
interest on and other amounts due under all Certificates held by such Holder and
all other sums payable to such Holder hereunder shall have been paid in full.
SECTION 2.11. Certificates in Respect of Replacement Airframe or Engine.
---------------------------------------------------------
Upon the execution and delivery of a Trust Agreement and Trust Indenture
Supplement covering a Replacement Airframe and/or Replacement Engine, as
provided in Section 9.09 hereof, each Certificate shall be deemed to have been
issued in connection with such Replacement Airframe and/or Replacement Engine
and each Certificate issued thereafter upon a transfer or exchange of, or as a
replacement for, a Certificate, shall be designated as having been issued in
connection with such Replacement Airframe and/or Replacement Engine, but without
any other change therein except as provided for in this Article II.
ARTICLE III
COVENANTS
SECTION 3.01. Payment of Principal, Premium and Interest. The Owner
------------------------------------------
Trustee covenants and agrees that it will duly and punctually pay or cause to be
paid the principal of, and interest and premium, if any, and all other amounts
due on, each of the Certificates hereunder at the place or places, at the
respective times and in the manner provided in this Indenture and in the
Certificates.
- 21 -
Principal and interest and other amounts due hereunder or under the
Certificates shall be payable in Dollars on the due date thereof, to the
Indenture Trustee at the Corporate Trust Office (or such other account at such
other financial institution in New York, New York or Atlanta, Georgia as the
Indenture Trustee may designate for the purpose). If any amount payable under
the Certificates or under this Indenture falls due on a day which is not a
Business Day, then such sum shall be payable on the next succeeding Business
Day, without additional interest thereon for the period of such extension.
SECTION 3.02. Offices for Payments, etc. So long as any of the
--------------------------
Certificates remain outstanding, the Indenture Trustee will maintain the
following: (a) an office or agency in Atlanta, Georgia where the Certificates
may be presented for payment and (b) a facility or agency in New York, New York
where the Certificates may be presented for registration of transfer and for
exchange and for redemption or any other payment as provided in this Indenture
(the "Registrar"). The Registrar shall keep a register (the "Register") with
respect to the Certificates and their transfer and exchange. The Indenture
Trustee may appoint one or more co-registrars ("Co-Registrars") for the
Certificates and may terminate any such appointment at any time upon written
notice. The term "Registrar" includes any Co-Registrar.
The Indenture Trustee shall initially act as Registrar.
SECTION 3.03. Appointment to Fill a Vacancy in Office of Indenture
----------------------------------------------------
Trustee. The Owner Trustee, whenever necessary to avoid or fill a vacancy in
- --------
the office of Indenture Trustee, will, with the consent of the Lessee, appoint,
in the manner provided in Section 12.02, an Indenture Trustee, so that there
shall at all times be an Indenture Trustee hereunder.
SECTION 3.04. Paying Agents. Whenever the Indenture Trustee in its sole
-------------
discretion shall appoint a paying agent (the "Paying Agent"), it will cause the
Paying Agent to execute and deliver an instrument in which the Paying Agent
shall agree with the Indenture Trustee, subject to the provisions of this
Section,
(a) that it will hold all sums received by it as such agent for the
payment of the principal of, and interest and premium, if any, on the
Certificates (whether such sums have been paid to it by the Indenture
Trustee or the Owner Trustee) in trust for the benefit of the Holders or of
the Indenture Trustee, and
(b) that it will give the Indenture Trustee notice of any failure by
the Owner Trustee to make any payment of the principal of or interest or
premium on the Certificates when the same shall be due and payable.
Anything in this Section to the contrary notwithstanding, the Owner Trustee
may at any time, for the purpose of obtaining a
- 22 -
satisfaction and discharge of this Indenture or for any other reason, pay or
cause to be paid to the Indenture Trustee all sums held in trust by the Owner
Trustee or any paying agent hereunder, such sums to be held by the Indenture
Trustee in trust as provided herein.
Anything in this Section to the contrary notwithstanding, the agreements to
hold sums in trust as provided in this Section are subject to the provisions of
Sections 14.03 and 14.04 hereof.
SECTION 3.05. Covenants of the Trust Company and the Owner Trustee.
----------------------------------------------------
(a) The Trust Company hereby covenants and agrees as follows:
(i) the Trust Company will perform its covenant set forth in
Section 7(h) of the Participation Agreement; and
(ii) the Trust Company will not directly or indirectly create,
incur, assume or suffer to exist any Lessor's Liens in or with respect to
the Indenture Estate or any of the properties or assets within the
Indenture Estate to the extent resulting from the acts or omissions of or
claims against the Trust Company (including, without limitation, the
nonpayment of any taxes based on or measured by the revenues or income of
the Trust Company).
(b) The Owner Trustee hereby covenants and agrees as follows:
(i) the Owner Trustee will perform its obligations under the
Lease to the extent permitted hereunder;
(ii) the Owner Trustee will perform its covenants set forth in
Sections 7(h) and 7(i) of the Participation Agreement;
(iii) in the event a Responsible Officer of the Owner Trustee
shall have actual knowledge of an Indenture Default or an Event of
Loss, the Owner Trustee will give prompt written notice of such
Indenture Default or Event of Loss to the Indenture Trustee, the
Lessee and the Owner Participant;
(iv) the Owner Trustee will furnish to the Indenture Trustee,
promptly upon receipt thereof, duplicates or copies of all reports,
notices, requests, demands, certificates, financial statements and
other instruments furnished to the Owner Trustee under the Lease,
including, without limitation, a copy of each report or notice
received pursuant to Section 11 of the Lease, to the extent that the
same shall not have been furnished to the Indenture Trustee;
- 23 -
(v) the Owner Trustee will not enter into any business or other
activity other than the business of owning the Aircraft, the leasing
thereof to the Lessee and the carrying out of the transactions
contemplated hereby and by the Lease, the Participation Agreement, the
Trust Agreement and the other Indenture Documents; and
(vi) the Owner Trustee will not directly or indirectly create,
incur, assume or suffer to exist any Lessor's Liens in or with respect
to the Indenture Estate or any of the properties or assets within the
Indenture Estate resulting from the acts or omissions of or claims
against the Owner Trustee (including, without limitation, the
nonpayment of any taxes based on or measured by the revenues or income
of the Owner Trustee).
SECTION 3.06. Intentionally Left Blank.
------------------------
SECTION 3.07. Disposal of Indenture Estate. At any time and from
----------------------------
time to time any part of the Indenture Estate may be sold or disposed of in
accordance with the provisions of this Indenture and the Lease. The Indenture
Trustee shall, from time to time, release from the Lien of this Indenture any
part of the Indenture Estate so sold or disposed of in accordance herewith, or
as to which an Event of Loss has occurred (and replacement thereof in accordance
herewith) or as to which the Lease has been terminated. In addition, to the
extent that such property constitutes an Airframe or Engine, the further
requirements of Section 9.08 shall be complied with.
SECTION 3.08. No Representations or Warranties as to Aircraft or
--------------------------------------------------
Documents. NEITHER THE INDENTURE TRUSTEE NOR THE OWNER TRUSTEE NOR THE TRUST
- ---------
COMPANY NOR THE OWNER PARTICIPANT MAKES OR SHALL BE DEEMED TO HAVE MADE ANY
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE, AIRWORTHINESS,
VALUE, COMPLIANCE WITH SPECIFICATIONS, CONDITION, DESIGN, QUALITY, DURABILITY,
OPERATION, MERCHANTABILITY OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE OF THE
AIRCRAFT OR ANY ENGINE, OR ANY OTHER REPRESENTATION OR WARRANTY HEREIN WITH
RESPECT TO THE AIRCRAFT OR ANY ENGINE WHATSOEVER, except that the Trust Company
warrants that on the Delivery Date (i) the Owner Trustee shall have received
whatever title to the Aircraft that was conveyed to it by the Lessee, and (ii)
the Aircraft shall be free and clear of Lessor's Liens attributable to the Trust
Company. Neither the Trust Company nor the Indenture Trustee makes or shall be
deemed to have made any representation or warranty as to the validity, legality
or enforceability of this Indenture, the Trust Agreement, the Certificates or
any Indenture Document or as to the correctness of any statement contained in
any thereof, except for the representations and warranties of the Trust Company
and the Indenture Trustee made in their respective individual capacities under
this Indenture or in the Participation Agreement. The Owner Participant makes no
representation or warranty hereunder whatsoever.
- 24 -
SECTION 3.09. Further Assurances; Financing Statements. At any time and
----------------------------------------
from time to time, upon the request of the Indenture Trustee or the Lessee, the
Owner Trustee shall promptly and duly execute and deliver, or cause to be
executed and delivered, any and all such further instruments and documents as
may be specified in such request and as are necessary or desirable to create,
perfect, preserve or protect the Liens and assignments created or intended to be
created hereby, or to obtain for the Indenture Trustee the full benefit of the
specific rights and powers granted herein, including, without limitation, the
execution and delivery of Uniform Commercial Code financing statements and
continuation statements with respect thereto, or similar instruments relating to
the perfection of the Liens or assignments created or intended to be created
hereby.
ARTICLE IV
HOLDER LISTS AND REPORTS
BY THE INDENTURE TRUSTEE
(a) The Indenture Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of the Holders. If the Indenture Trustee is not the Registrar, the
Owner Trustee will cause the Registrar to furnish to the Indenture Trustee semi-
annually not more than 15 days after each Record Date, as of such Record Date,
or at such other times as the Indenture Trustee may request in writing, a list,
in such form and as of such date as the Indenture Trustee may reasonably
require, containing all the information in the possession or control of the
Registrar as to the names and addresses of the Holders and the amounts and
Maturities of the Certificates held by such Holders.
(b) Ownership of the Certificates shall be proved by the Register kept by
the Registrar.
ARTICLE V
RECEIPT, DISTRIBUTION AND APPLICATION OF
INCOME FROM THE INDENTURE ESTATE
SECTION 5.01. Basic Rent Distribution. Except as otherwise provided in
-----------------------
Section 5.03 hereof, each installment of Basic Rent, any payment of interest on
overdue installments of Basic Rent and any payment in respect of the foregoing
received by the Indenture Trustee pursuant to Section 8.03 hereof shall be
promptly distributed in the following order of priority: first, so much of such
-----
installment or payment as shall be required to pay in full the aggregate amount
of the payment or payments of principal and interest (as well as any interest on
overdue principal and, to the extent permitted by law, on interest) then due
under all Certificates shall be distributed to the Holders ratably, without
- 25 -
priority of one over the other, in the proportion that the amount of such
payment or payments then due under each such Certificate bears to the aggregate
amount of the payments then due under all such Certificates, and, second, the
------
balance, if any, of such installment or payment remaining thereafter shall be
distributed to the Owner Trustee, or as the Owner Trustee may request, for
distribution pursuant to the Trust Agreement; provided, however, that if an
--------- --------
Indenture Default shall have occurred and be continuing, then such balance shall
not be distributed as provided in this clause "second" but shall be held by the
------
Indenture Trustee as part of the Indenture Estate until whichever of the
following shall first occur: (i) all Indenture Defaults shall have been cured,
in which event such balance shall be distributed as provided in this clause
"second", (ii) such Indenture Default shall have continued for a period of 120
days, in which event such balance shall be distributed as provided in this
clause "second", or (iii) Section 5.03 hereof shall be applicable, in which
event such balance shall be distributed in accordance with the provisions
thereof.
SECTION 5.02. Event of Loss and Replacement; Redemption or Purchase. (a)
-----------------------------------------------------
Except as otherwise provided in Section 5.03 hereof, any payment received by the
Indenture Trustee as the result of an Event of Loss with respect to the Aircraft
or as the result of redemption or purchase pursuant to Section 6.02 hereof,
shall be promptly distributed by the Indenture Trustee in the following order of
priority: first, to reimburse the Indenture Trustee for any out-of-pocket costs
-----
or expenses reasonably incurred in connection with such prepayment or redemption
or purchase, as the case may be, second, as provided in clause "second" of
------ ------
Section 5.03 hereof, and third, as provided in clause "third" of Section 5.03
----- -----
hereof; provided that if a Replacement Airframe shall be substituted for an
--------
Airframe subject to an Event of Loss as provided in Section 10 of the Lease and
Section 9.08 hereof, any proceeds which result from such Event of Loss and are
paid to the Indenture Trustee shall be held by the Indenture Trustee as part of
the Indenture Estate and, unless otherwise applied pursuant to Section 5.01 or
5.03 hereof, such proceeds shall be released to the Owner Trustee or the Lessee
at the Owner Trustee's written request upon the release of the replaced Airframe
and its replacement as herein provided.
(b) Except as otherwise provided in Section 5.03 hereof, any amounts
received directly or indirectly from any governmental authority, insurer or
other party pursuant to any provision of Section 10 or 11 of the Lease, if and
to the extent that such amounts would at the time be required to be paid to the
Lessee pursuant to said Section 10 or 11 but for the fact that a Lease Event of
Default, a Lease Payment Default or a Lease Bankruptcy Default shall have
occurred and be continuing, shall be held by the Indenture Trustee, as assignee
of the Owner Trustee, as security for the obligations of the Lessee under the
Lease and the Participation Agreement and shall be invested in accordance with
the terms of Section 5.08 hereof and at such time as the
- 26 -
conditions for payment to the Lessee specified in said Section 10 or 11, as the
case may be, shall be fulfilled and there shall not be continuing any Lease
Event of Default, Lease Payment Default or a Lease Bankruptcy Default, such
amount, and the proceeds of any investment thereof (or as reduced by such
investment, as the case may be), shall, to the extent not theretofore applied
against such obligations or then required to be applied against such obligations
pursuant hereto, be paid to the Lessee to the extent provided in the Lease.
SECTION 5.03. Payment After Indenture Event of Default, etc. Except as
----------------------------------------------
otherwise provided in Sections 5.04(b), 5.04(c) and 5.05(b) hereof, all payments
received and all amounts held or realized by the Indenture Trustee (i) after an
Indenture Event of Default shall have occurred and so long as such an Indenture
Event of Default shall be continuing, and after the Indenture Trustee has
received a request in accordance with Section 7.10 hereof to accelerate the
Certificates, (ii) after the Certificates shall have become due and payable as
provided in Section 7.02(b) or (c) hereof, or (iii) after the Indenture Trustee
shall foreclose under this Indenture, shall be promptly distributed by the
Indenture Trustee in the following order of priority:
first, so much of such payments or amounts as shall be required to
------
reimburse the Indenture Trustee for any tax, expense, charge or other loss
(including, without limitation, all amounts to be expended at the expense of, or
charged upon the tolls, rents, revenues, issues, products and profits of, the
property included in the Indenture Estate pursuant to Section 7.03(b) hereof)
incurred by the Indenture Trustee (to the extent not previously reimbursed)
(including, without limitation, the expenses of any sale, taking or other
proceeding, attorneys' fees and expenses, court costs, and any other
expenditures incurred or expenditures or advances made by the Indenture Trustee)
in the protection, exercise or enforcement of any right, power or remedy or any
damages sustained by the Indenture Trustee, liquidated or otherwise, upon such
Indenture Event of Default shall be applied by the Indenture Trustee in
reimbursement of such expenses;
second, so much of such payments or amounts as shall be required to pay in
-------
full the aggregate unpaid principal amount of all outstanding Certificates, all
accrued but unpaid interest thereon to the date of distribution and all other
amounts due thereunder (but without premium, except to the extent otherwise
payable hereunder), shall be distributed to the Holders, and if the aggregate
amount so to be distributed shall be insufficient to pay all such amounts in
full as aforesaid, then such amount shall be distributed ratably to Holders of
Outstanding Certificates, without priority of one over the other, in the
proportion that the aggregate unpaid principal amount of all Outstanding
Certificates held by each such Holder, plus the accrued but unpaid interest
thereon to the date of distribution and all other amounts due thereunder (but
without premium, except to the extent otherwise payable hereunder), bears to the
aggregate unpaid principal amount
- 27 -
of all Outstanding Certificates, plus accrued but unpaid interest thereon to the
date of distribution and all other amounts due thereunder (but without premium,
except to the extent otherwise payable hereunder); and
third, the balance, if any, of such payments or amounts remaining
------
thereafter shall be distributed to the Owner Trustee for distribution pursuant
to the Trust Agreement.
SECTION 5.04. Certain Payments. (a) Except as otherwise provided in this
----------------
Indenture, any payments received by the Indenture Trustee which are to be
applied according to any provision in any other Indenture Document shall be
applied thereunder in accordance therewith.
(b) The Indenture Trustee will distribute, promptly upon receipt thereof
any indemnity or other payment received by it from the Owner Trustee or the
Lessee in respect of the Indenture Trustee in its individual capacity pursuant
to Section 6 of the Participation Agreement or as Supplemental Rent, directly to
the Person (which may include the Indenture Trustee in its individual capacity)
entitled thereto.
(c) Notwithstanding anything to the contrary contained herein, any sums
received by the Indenture Trustee which constitute Excepted Payments shall be
distributed promptly upon receipt by the Indenture Trustee directly to the
Person or Persons entitled thereto.
SECTION 5.05. Other Payments. Any payments received by the Indenture
--------------
Trustee for which no provision as to the application thereof is made elsewhere
in this Indenture or in any other Indenture Document (including without
limitation Section 9 of the Lease) shall be distributed by the Indenture Trustee
(a) to the extent received or realized at any time prior to the payment in full
of all obligations to the Holders secured by the Lien of this Indenture, in the
order of priority specified in Section 5.01 hereof, and (b) to the extent
received or realized at any time after payment in full of all obligations to the
Holders secured by the Lien of this Indenture, in the following order of
priority: first, in the manner provided in clause "first" of Section 5.03 hereof
------ -------
and second, in the manner provided in clause "third" of Section 5.03 hereof.
------- -------
SECTION 5.06. Payments to Owner Trustee. Any amounts distributed
-------------------------
hereunder by the Indenture Trustee to the Owner Trustee shall be paid no later
than 2:00 p.m. New York time on the date of receipt thereof (so long as such
amounts have been received by the Indenture Trustee in accordance with Section
3(d) of the Lease and the time periods specified therein) to the Owner Trustee
by wire transfer of immediately available funds of the type received by the
Indenture Trustee at such office and to such account or accounts of such entity
or entities as shall be designated by notice from the Owner Trustee to the
Indenture
- 28 -
Trustee from time to time. The Owner Trustee hereby notifies the Indenture
Trustee that unless and until the Indenture Trustee receives notice to the
contrary from the Owner Trustee, all amounts to be distributed to the Owner
Trustee hereunder for distribution in accordance with the Trust Agreement shall
be distributed by wire transfer of immediately available funds of the type
received by the Indenture Trustee to such account of the Owner Participant as
may be specified pursuant to Section 5.01 of the Trust Agreement.
SECTION 5.07. Application of Payments. Each payment of principal of and
------------------------
interest, premium or other amounts due on each Certificate shall, except as
otherwise provided herein, be applied, first, to the payment of interest on such
-----
Certificate due and payable to the date of such payment, as provided in such
Certificate, as well as any interest on overdue principal and premium (if any)
and, to the extent permitted by law, interest and other amounts due thereunder,
second, to the payment of any other amount (other than the principal of such
- ------
Certificate) due hereunder or under such Certificate to the Holder of such
Certificate, third, to the payment of the principal of such Certificate if then
-----
due hereunder or under such Certificate, fourth, the balance, if any, remaining
------
thereafter, to the payment of the principal of such Certificate remaining unpaid
(provided that such Certificate shall not be subject to prepayment without the
consent of the affected Holder except as permitted by Sections 6.02, 6.06 and
8.02 hereof) and, fifth, the balance, if any, remaining thereafter shall be held
-----
as additional collateral subject to the Lien of this Indenture.
SECTION 5.08. Investment of Amounts Held by Indenture Trustee. Amounts
-----------------------------------------------
held by the Indenture Trustee pursuant to the proviso to Section 5.01 hereof,
pursuant to Section 5.02 hereof or pursuant to any provision of any Indenture
Document providing for investment of sums pursuant to this Section 5.08 shall be
invested by the Indenture Trustee from time to time in securities (i) selected
by the Lessee on behalf of the Owner Trustee, or if a Lease Event of Default is
continuing, by the Owner Trustee and if the Lessee or the Owner Trustee, as the
case may be, fail to select the securities to be invested, by the Indenture
Trustee and (ii) of the type listed in Section 24 of the Lease, which may
include securities or obligations issued by the Indenture Trustee or any of its
affiliates. Unless otherwise expressly provided in this Indenture, any income
realized as a result of any such investment, net of the Indenture Trustee's
reasonable fees and expenses in making such investment, shall be held and
applied by the Indenture Trustee in the same manner as the principal amount of
such investment is to be applied and any losses, net of earnings and such
reasonable fees and expenses, shall be charged against the principal amount
invested. The Indenture Trustee shall not be liable for any loss resulting from
any investment made by it under this Indenture in accordance with instructions
from the Lessee or the Owner Trustee, as the case may be, other than by reason
of its willful misconduct or gross negligence, in
- 29 -
which case the Indenture Trustee will be liable in its individual capacity only,
and any such investment may be sold (without regard to its maturity) by the
Indenture Trustee without instructions whenever the Indenture Trustee reasonably
believes such sale is necessary to make a distribution required by this
Indenture.
Unless otherwise stated in writing as set forth below, an account statement
delivered by the Indenture Trustee to the Owner Trustee (with a copy to the
Lessee) shall be deemed written confirmation by the Owner Trustee that the
investment transactions identified therein accurately reflect the investment
directions given to the Indenture Trustee by or on behalf of the Owner Trustee,
unless the Owner Trustee (or the Lessee on its behalf) notifies the Indenture
Trustee in writing to the contrary within 30 days of the date of receipt of such
statement.
SECTION 5.09. Withholding Taxes. The Indenture Trustee shall withhold any
-----------------
taxes required to be withheld on payments to any Holder who is not a United
States person except to the extent that such Holder has furnished evidence
satisfactory to the Indenture Trustee of any exemption from withholding claimed
by such Holder. Neither the Indenture Trustee nor Owner Trustee nor the Owner
Participant shall have any obligation to make any additional payment to cover
such withholding. Such withholding and failure to make any additional payment
based thereon shall not constitute an Indenture Event of Default.
Notwithstanding any provision to the contrary in Sections 5.01 through 5.05
hereof and subject to Section 6(b) of the Participation Agreement, if the Lessee
is required to pay any such withholding tax imposed on payments made by or on
behalf of the Owner Trustee to the Indenture Trustee, or any interest or penalty
thereon, or to indemnify the Owner Participant or the Owner Trustee with respect
thereto pursuant to Section 6(b) of the Participation Agreement, the Lessee
shall, after such payment or reimbursement by it, have a claim against any
Holder who was subject to such withholding tax for the amount of such
withholding tax. After such payment or reimbursement by it, the Lessee shall be
entitled to receive, and the Indenture Trustee shall hold for the account of the
Lessee, any payments otherwise distributable to the Holder who was subject to
such withholding tax pursuant to Sections 5.01 through 5.05 hereof until the
foregoing amounts (to the extent recoverable from such Holder pursuant to the
express provisions of Section 6(b) of the Participation Agreement) (the
"Recoverable Amounts") shall have been recovered in full by the Lessee. In no
event will the recoupment described in the preceding sentence result in a
reduction in payments otherwise distributable to such Holder by more than the
Recoverable Amounts.
- 30 -
ARTICLE VI
REDEMPTION OR PURCHASE OF CERTIFICATES
SECTION 6.01. No Redemption Prior to Maturity. Except as provided in
-------------------------------
Sections 6.02, 6.06 and 8.02, the Certificates may not be redeemed prior to
their respective Maturities.
SECTION 6.02. Redemption or Purchase of Certificates. The Outstanding
--------------------------------------
Certificates shall without the requirement of any further action on the part of
the Owner Trustee, except in the case of a redemption or purchase under Section
6.02(B), 6.02(C) or 6.02(E), be redeemed or purchased:
(A) If an Event of Loss occurs with respect to the Aircraft (unless
pursuant to Section 10 of the Lease and Section 9.08 hereof a Replacement
Airframe (together, if applicable, with a Replacement Engine or Engines) is
substituted therefor), other than an Event of Loss deemed to have occurred
pursuant to the last paragraph of Section 6(b) of the Participation
Agreement, at a price equal to the aggregate unpaid principal amount of
such Certificates together with accrued and unpaid interest thereon to but
excluding the Redemption Date, but without premium.
(B) If the Owner Trustee, at the direction of the Lessee, gives
notice of redemption to the Indenture Trustee at any time after the date of
initial issuance of the Certificates, or if an Event of Loss with respect
to the Aircraft is deemed to have occurred pursuant to the last paragraph
of Section 6(b) of the Participation Agreement, at a price equal to the
Redemption Amount plus all accrued and unpaid interest on such Certificates
to but excluding the Redemption Date.
(C) If the Owner Trustee, at the direction of the Owner Participant,
at any time gives notice of purchase or redemption to the Indenture Trustee
pursuant to Section 8.02(a) hereof, at a price equal to the aggregate
unpaid principal amount of such Certificates together with accrued and
unpaid interest thereon to but excluding the Redemption Date, but without
premium (except in the case of any redemption or purchase pursuant to
Section 8.02(a)(i) hereof, in which case the premium shall be payable).
(D) Upon any termination of the Lease as provided in Section 9(a) of
the Lease, at a price equal to the Redemption Amount plus all accrued and
unpaid interest on such Certificates to but excluding the Redemption Date.
(E) Upon the Lessee's exercise of its option to purchase the Aircraft
as provided in Section 16(b)(i) of the Participation Agreement or Section
5(b) of the Lease, at a price equal to the Redemption Amount together with
accrued
- 31 -
and unpaid interest thereon to but excluding the Redemption Date.
SECTION 6.03. Notice of Redemption or Purchase to Holders. In order to
-------------------------------------------
effect any redemption or purchase set forth in Section 6.02 hereof, the
Indenture Trustee shall give prompt notice by first class mail of redemption or
purchase (which notice may be revoked by the Owner Trustee at any time on or
before the Redemption Date by prompt notice to the Holders except (i) in the
case of a redemption or purchase contemplated by Sections 6.02(C) or 6.02(E)
hereof, (ii) any redemption contemplated by Section 6.02(D) hereof unless the
notice of termination of the Lease pursuant to Section 9(a) thereof has been
revoked or if the Lease otherwise continues in effect in accordance with the
pentultemate sentence of the third paragraph of Section 9(a) thereof or (iii)
revocation of notice of redemption contemplated by Section 6.02(A) hereof shall
not be permitted unless a Replacement Airframe is substituted pursuant to
Section 10 of the Lease and Section 9.08 hereof) to each Holder of an
Outstanding Certificate.
All notices of redemption or purchase shall state:
(1) the Redemption Date,
(2) the applicable basis for determining the Redemption Price,
(3) that on the Redemption Date, subject to the provisions hereof, the
Redemption Price will become due and payable upon each such Certificate, and, in
the case of a redemption, that interest thereon shall cease to accrue on and
after such Redemption Date, and
(4) the place or places where such Certificates are to be surrendered for
payment.
SECTION 6.04. Deposit of Redemption Price. On the Redemption Date or the
---------------------------
Sinking Fund Redemption Date (as defined in Section 6.06), the Owner Trustee
shall, to the extent an amount equal to the Redemption Price or the Sinking Fund
Redemption Price (as defined in Section 6.06), as the case may be, shall not
then be held in the Indenture Estate, deposit with the Indenture Trustee in
immediately available funds an amount equal to the difference between (a) the
amount then held in the Indenture Estate and (b) the Redemption Price or the
Sinking Fund Redemption Price, as the case may be. In the case of a redemption,
interest shall cease to accrue in respect of all or, in the case of a mandatory
sinking fund redemption, the relevant portion of, the Outstanding Certificates
on and after the later of (1) deposit of the applicable Redemption Price or
Sinking Fund Redemption Price on or prior to a Redemption Date or Sinking Fund
Redemption Date and (2) such Redemption Date or such Sinking Fund Redemption
Date.
- 32 -
SECTION 6.05. Certificates Payable on Redemption Date. On the Redemption
---------------------------------------
Date, the Outstanding Certificates (other than Certificates being purchased
pursuant to Section 8.02(a)) shall (except if the Owner Trustee has revoked such
notice of redemption or purchase in accordance with Section 6.03 hereof) become
due and payable and, in the case of a redemption, from and after such Redemption
Date (unless there shall be a default in the payment of the Redemption Price)
such Certificates shall cease to bear interest. Upon surrender of any such
Certificate for redemption or purchase in accordance with said notice, such
Certificate shall be paid or purchased at the Redemption Price.
If any Certificate called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid, continue to
bear interest from the Redemption Date at the interest rate applicable to such
Certificate.
SECTION 6.06. Mandatory Sinking Fund Redemptions. The Certificates with a
-----------------------------------
Maturity of ________________ and the Certificates with a Maturity of
_____________ shall also be subject to redemption, at the principal amount
thereof plus accrued interest, but without premium, in part on a pro rata basis
on each date specified in this Section (a "Sinking Fund Redemption Date"). The
Owner Trustee shall deposit funds sufficient to pay for such amount payable on
redemption with the Indenture Trustee as provided in Section 6.04. The Indenture
Trustee shall pay from the amounts so deposited on each applicable Sinking Fund
Redemption Date to the Holders of each Certificate then Outstanding on a pro
rata basis the aggregate principal amount set forth below, together with accrued
interest to such Sinking Fund Redemption Date, but without premium (the "Sinking
Fund Redemption Price"):
Principal Amount
----------------
Sinking Fund Certificates Certificates
Redemption Date with a Maturity of with a Maturity of
- --------------- ---------------------- ----------------------
$
_________________ ________________
Total $ $
- 33 -
ARTICLE VII
REMEDIES OF INDENTURE TRUSTEE
AND HOLDERS
SECTION 7.01. Indenture Event of Default. "Indenture Event of Default"
--------------------------
means any of the following events (whatever the reason for such Indenture Event
of Default and whether such event shall be voluntary or involuntary or come
about or be effected by operation of law or pursuant to or in compliance with
any judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body):
(a) any Lease Event of Default (other than a Lease Event of Default
arising by failure to make an Excepted Payment unless the Owner Participant
shall acquiesce in the treatment of such failure as an Indenture Event of
Default) shall have occurred and be continuing; or
(b) the failure of the Owner Trustee other than by reason of a Lease
Event of Default to pay to the Indenture Trustee when due any payment of
principal of or premium, if any, or interest on any Certificate, or any
purchase price therefor, and such failure shall have continued unremedied
for ten Business Days, or the failure of the Owner Trustee (other than by
reason of a Lease Default or a Lease Event of Default or other than by a
failure of the Indenture Trustee to properly pay monies received by it
pursuant hereto) to pay when due any other amount due and payable
hereunder, or under any Certificate, and such failure shall have continued
unremedied for ten days after the Owner Trustee shall receive written
demand therefor from the Indenture Trustee or any Holder; or
(c) any Lessor's Lien required to be discharged by the Trust Company
pursuant hereto or pursuant to the Participation Agreement or by the Owner
Trustee pursuant hereto or pursuant to the Participation Agreement or any
Owner Participant's Lien required to be discharged by the Owner Participant
pursuant to the Participation Agreement shall remain undischarged for a
period of 30 days after a Responsible Officer of the Trust Company, the
Owner Trustee or the Owner Participant, as the case may be, shall have
actual knowledge of such Lien; or
(d) any representation or warranty made by the Owner Participant, the
Trust Company or the Owner Trustee herein or in the Participation Agreement
shall prove to have been false or incorrect when made in any respect
material to the Holders, and such falseness or incorrectness is material to
such Holders at the time of the notice referred to below, and if capable of
remedy, is not remedied for 30 days after there has been given to the Owner
Trustee, the Owner Participant or the Trust Company, as the case may be, by
registered or
- 34 -
certified mail, a written notice specifying such breach and requiring it to
be remedied and stating that such notice is a "Notice of Indenture Default"
hereunder, by the Indenture Trustee or by the Holders of not less than 25%
in aggregate principal amount of Outstanding Certificates; or
(e) any failure of the Owner Trustee to observe any of its covenants
in the fourth paragraph following the Habendum Clause hereof or in Section
3.05(b)(v) hereof or any failure by the Owner Participant to observe or
perform any of its respective covenants in Section 8(c) or Section 16(a) of
the Participation Agreement; or
(f) any failure by the Owner Trustee to observe or perform any other
covenant or obligation of the Owner Trustee contained in this Indenture or
in the Participation Agreement or any failure by the Owner Participant to
observe or perform any other covenant or obligation of the Owner
Participant contained in the Participation Agreement which, in either case,
is not remedied within a period of 30 days or, if such covenant is capable
of cure and such person is diligently proceeding to effect such a cure, 60
days after there has been given to the Owner Trustee and the Owner
Participant, by registered or certified mail, a written notice specifying
such breach and requiring it to be remedied and stating that such notice is
a "Notice of Indenture Default" hereunder, by the Indenture Trustee or by
the Holders of not less than 25% in aggregate principal amount of
Outstanding Certificates; or
(g) either the Trust Estate or the Owner Trustee with respect thereto
(and not solely in its individual capacity) or the Owner Participant or any
Person guaranteeing any obligations of the Owner Participant under the
Operative Documents shall (i) be unable to pay its debts generally as they
become due within the meaning of Title 11 of the United States Code, (ii)
file, or consent by answer or otherwise to the filing against it of a
petition for relief or reorganization or arrangement or any other petition
in bankruptcy, for liquidation or to take advantage of any bankruptcy or
insolvency law of any jurisdiction, (iii) make an assignment for the
benefit of its creditors, (iv) consent to the appointment of a custodian,
receiver, trustee or other officer with similar powers with respect to
itself or with respect to any substantial part of its property, or (v) take
corporate or comparable action for the purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction shall
enter an order appointing, without consent by the Owner Trustee or the
Owner Participant or any Person guaranteeing any obligations of the Owner
Participant under the Operative Documents, as the case may be, a custodian,
receiver, trustee or other officer with similar powers with respect to the
Trust Estate or the Owner Trustee with respect
- 35 -
thereto (and not solely in its individual capacity) or the Owner
Participant or any Person so guaranteeing its obligations, as the case may
be, or with respect to any substantial part of its property, or
constituting an order for relief or approving a petition for relief or
reorganization or any other petition in bankruptcy or for liquidation or to
take advantage of any bankruptcy or insolvency law of any jurisdiction, or
ordering the dissolution, winding-up or liquidation of the Trust Estate or
the Owner Trustee with respect thereto (and not solely in its individual
capacity) or the Owner Participant or any such Person, as the case may be,
and such order shall remain in force undismissed, unstayed or unvacated for
a period of 60 days after the date of entry thereof; or
(i) any petition for any relief specified in the foregoing paragraph
(g) shall be filed against the Trust Estate or the Owner Trustee with
respect thereto (and not solely in its individual capacity) or the Owner
Participant or any Person guaranteeing any obligations of the Owner
Participant under the Operative Documents, as the case may be, and such
petition shall not be dismissed within 60 days; or
(j) at any time while the Aircraft is registered in the United
States, the Owner Trustee, the Trust Company or the Owner Participant shall
do or fail to do any act, expressly required by the Operative Documents or
shall meet or fail to meet any condition expressly required by the
Operative Documents (other than, in any such case, such act or condition
that is the responsibility of Lessee under the Indenture Documents), and as
a result thereof the Lien of this Indenture shall cease to be a valid first
priority perfected Lien on the Indenture Estate.
SECTION 7.02. Remedies. (a) If an Indenture Event of Default shall
--------
have occurred and be continuing, then and in every such case, the Indenture
Trustee may, and when required by the provisions of Article IX or Section
7.02(c) hereof, shall, (i) exercise any or all of the rights and powers and
pursue any or all of the remedies pursuant to this Article VII and (ii) in the
event such Indenture Event of Default is an Indenture Event of Default referred
to in paragraph (a) of Section 7.01 hereof, but subject to the provisions of
Section 8.03 hereof, and after the expiration of ten days from the time the
Indenture Trustee notifies the Owner Trustee and the Owner Participant that it
intends to exercise its remedies (including acceleration of the Certificates)
hereunder, exercise any or all of the remedies pursuant to Section 15 of the
Lease, and the Indenture Trustee may take possession of all or any part of the
properties covered or intended to be covered by the Lien and security interest
created hereby or pursuant hereto and may exclude the Owner Participant, the
Owner Trustee and the Lessee and all persons claiming under any of them wholly
or partly therefrom. In addition, the Indenture Trustee may exercise any
- 36 -
other right or remedy in lieu of or in addition to the foregoing that may be
available to it under applicable law, or proceed by appropriate court action to
enforce the terms hereof, of the Lease, or both, or to terminate or rescind the
Lease. Without limiting any of the foregoing, but subject to any conditions
provided for herein or under applicable law, it is understood and agreed that
the Indenture Trustee may exercise any right of sale of the Aircraft available
to it, even though it shall not have taken possession of the Aircraft and shall
not have possession thereof at the time of such sale. Notwithstanding the
foregoing, the Indenture Trustee shall not be entitled to exercise any remedy
hereunder as a result of an Indenture Event of Default occurring solely by
reason of one or more Lease Events of Default unless the Indenture Trustee shall
have declared the Lease to be in default in accordance with Section 15 thereof
and shall be attempting in good faith to exercise one or more of the remedies
referred to in Section 15 of the Lease; provided, however, that such requirement
------------------
to attempt in good faith to exercise one or more of such remedies under the
Lease shall not apply in circumstances where the Indenture Trustee is, and has
been for a continuous period in excess of 60 days or such other period as may be
specified in Section 1110(a)(1) of the Bankruptcy Code (such 60-day or other
period being the "Section 1110 Period"), involuntarily stayed or prohibited by
applicable law or court order from exercising such remedies under the Lease (a
"Continuous Stay Period"); provided, further, however, that the requirement to
attempt in good faith to exercise one or more of such remedies under the Lease
shall nonetheless be applicable during a Continuous Stay Period subsequent to
the expiration of the Section 1110 Period to the extent that the continuation of
such Continuous Stay Period subsequent to the expiration of the Section 1110
Period (A) results from an agreement by the Lessee during the Section 1110
Period with the approval of the relevant court to perform the Lease in
accordance with Section 1110(a) of the Bankruptcy Code or (B) is an extension of
the Section 1110 Period with the consent of the Indenture Trustee pursuant to
Section 1110(b) of the Bankruptcy Code or (C) results from the Lessee's
assumption during the Section 1110 Period with the approval of the relevant
court of the Lease pursuant to Section 365 of the Bankruptcy Code or (D) is the
consequence of the Indenture Trustee's own failure to give any requisite notice
to any Person or (E) is pursuant to a judicial stay pending the resolution of
litigation with respect to the applicability of Section 1110 of the Bankruptcy
Code and there is either no Lease Event of Default other than one arising solely
from the Lessee's bankruptcy or any such other Lease Event of Default has been
cured; provided, further, however, that the requirement to attempt in good faith
--------- -------- --------
to exercise one or more of such remedies under the Lease during a Continuous
Stay Period subsequent to the expiration of the Section 1110 Period based upon a
judicial stay as provided for in this clause (E) shall in any event cease to be
applicable subsequent to the 120th day of such Continuous Stay Period; it being
understood and agreed that the Indenture Trustee may take such action and
commence such processes as it may determine are necessary or advisable to
foreclose on the
- 37 -
Lien of this Indenture but all such actions and processes shall, during such
period, not be completed to effect a foreclosure. If the Indenture Trustee shall
acquire the Aircraft pursuant to a foreclosure under this Indenture while such
stay is still in effect and consummates a resale of the Aircraft within six
months of such acquisition, the net proceeds from such resale in excess of the
amounts owed to the Holders of the Certificates will be paid to the Owner
Trustee.
(b) Notwithstanding Section 7.02(c) hereof, if an Indenture Event of
Default referred to in clause (g), (h) or (i) of Section 7.01 hereof shall have
occurred, or a Lease Event of Default referred to in clause (f), (g) or (h) of
Section 14 of the Lease shall have occurred, then and in every such case the
unpaid principal of all Outstanding Certificates, together with interest accrued
but unpaid thereon and all other amounts due thereunder and hereunder, but
without premium, shall immediately and without further act become due and
payable, without presentment, demand, protest or notice, all of which are hereby
waived.
(c) If any Indenture Event of Default not described in the preceding
paragraph (b) shall have occurred and be continuing, then and in every such
case, the Indenture Trustee may on its own accord or at the direction of Holders
of not less than 25% in aggregate principal amount of Outstanding Certificates,
at any time, by written notice or notices to the Owner Trustee and the Lessee,
declare the principal of all the Certificates to be due and payable, whereupon
the unpaid principal of all Outstanding Certificates, together with accrued but
unpaid interest thereon and all other amounts due thereunder, but without
premium (except to the extent a premium was theretofore payable by virtue of
Section 6.02(B), 6.02(C) (with respect to Section 8.02(a)(i)), 6.02(D) or
6.02(E)), shall immediately become due and payable without presentment, demand,
protest or other notice, all of which are hereby waived. At any time after such
declaration and prior to the sale or disposition of the Indenture Estate,
however, a Majority in Interest of Certificate Holders, by notice to the
Indenture Trustee, the Owner Trustee and the Lessee, may rescind such
declaration, whether made by the Indenture Trustee on its own accord or as
directed, if (x) there has been paid or deposited with the Indenture Trustee a
sum sufficient to pay all overdue installments of interest on all Certificates
(together, to the extent permitted by law, with interest on such overdue
installments of interest), the principal on any Certificates that has become due
otherwise than by such declaration of acceleration, all sums paid or advanced by
the Indenture Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee, its agents and counsel, or
(y) all Indenture Events of Default (other than the nonpayment of principal that
has become due solely because of such acceleration) have been either cured or
waived as provided in Section 7.11. No such rescission shall affect any
subsequent default or impair any right consequent thereon.
- 38 -
(d) Each Holder shall be entitled, at any sale pursuant to Section 15
of the Lease, to a credit against any purchase price bid at such sale by such
Holder for all or any part of the unpaid obligations owing to such Holder and
secured by the Lien of this Indenture.
SECTION 7.03. Return of Aircraft, etc. Subject to Section 7.02: (a)
------------------------
If an Indenture Event of Default shall have occurred and be continuing, at the
request of the Indenture Trustee, the Owner Trustee shall promptly execute and
deliver to the Indenture Trustee such instruments of title and other documents
as the Indenture Trustee may deem necessary or advisable to enable the Indenture
Trustee or an agent or representative designated by the Indenture Trustee, at
such time or times and place or places as the Indenture Trustee may specify, to
obtain possession of all or any part of the Indenture Estate to which the
Indenture Trustee shall at the time be entitled hereunder. If the Owner Trustee
shall for any reason fail to execute and deliver such instruments and documents
after such request by the Indenture Trustee, the Indenture Trustee may (i)
obtain a judgment conferring on the Indenture Trustee the right to immediate
possession and requiring the Owner Trustee to execute and deliver such
instruments and documents to the Indenture Trustee, to the entry of which
judgment the Owner Trustee hereby specifically consents, and (ii) pursue all or
part of the Indenture Estate wherever such Indenture Estate may be found and
may, in the name of the Owner Trustee or otherwise, enter any of the premises of
the Lessee and search for and take possession of and remove the Indenture
Estate. All expenses of obtaining such judgment or of pursuing, searching for
and taking such property shall, until paid, be secured by the Lien of this
Indenture.
(b) Upon every such taking of possession or title, the Indenture
Trustee may, from time to time, at the expense of the Indenture Estate, make all
such expenditures for maintenance, insurance, repairs, replacements,
alterations, additions and improvements to and of the Indenture Estate, as it
may deem proper. In each such case, the Indenture Trustee shall have the right
to maintain, use, operate, store, lease, control or manage the Indenture Estate
and to carry on the business and, without limiting the express provisions of
Section 8.01 hereof, to exercise all rights and powers of the Owner Participant
and the Owner Trustee relating to the Indenture Estate, as the Indenture Trustee
shall deem necessary or appropriate, including the right to enter into any and
all such agreements with respect to the maintenance, insurance, use, operation,
storage, leasing, control, management or disposition of the Indenture Estate or
any part thereof as the Indenture Trustee may determine; and, except for
Excepted Payments (other than Excepted Payments payable to the Indenture
Trustee), the Indenture Trustee shall be entitled to collect and receive
directly all rents (including Rent), revenues, issues, income, products and
profits of the Indenture Estate and every part thereof without prejudice to the
right of the Indenture Trustee under any provision hereof to collect and receive
all cash
- 39 -
held by, or required to be deposited with, the Indenture Trustee hereunder. Such
rents (including Rent), revenues, issues, income, products and profits shall be
applied to pay the expenses of the use, operation, storage, leasing, control,
management or disposition of the Indenture Estate and of conducting the business
thereof, and of all maintenance, repairs, replacements, alterations, additions
and improvements, and to make all payments which the Indenture Trustee may be
required or may elect to make, if any, for taxes, assessments, insurance or
other proper charges upon the Indenture Estate or any part thereof (including
the employment of engineers and accountants to examine, inspect and make reports
upon the properties and books and records of the Owner Trustee), and all other
payments which the Indenture Trustee may be required or authorized to make under
any provision of this Indenture, as well as just and reasonable compensation for
the services of the Indenture Trustee, and of all persons properly engaged and
employed by the Indenture Trustee.
(c) If an Indenture Event of Default shall have occurred and be
continuing and the Indenture Trustee shall be entitled to exercise remedies
hereunder, and subject to Article VIII hereof, the Indenture Trustee, either
with or without taking possession, and either before or after taking possession,
and without instituting any legal proceedings whatsoever, may sell, assign,
transfer and deliver the whole or, from time to time, to the extent permitted by
law, any part of the Indenture Estate, or any part thereof, or interest therein,
at any private sale or public auction, with or without demand, advertisement or
notice, except as expressly provided for below in this Section 7.03(c), for cash
or credit or for other property, for immediate or future delivery, and for such
price or prices and on such terms as the Indenture Trustee in its sole
discretion may determine; provided, that any such action shall be at the time
--------
lawful and that all mandatory legal requirements shall be complied with. The
Indenture Trustee shall give the Owner Trustee, the Owner Participant and the
Lessee at least 20 days' notice of any public or private sale. Such notice, in
the case of a public sale, shall state the time and place fixed for such sale.
Any such public sale shall be held at such time or times within ordinary
business hours as the Indenture Trustee shall fix in the notice of such sale. At
any such sale, the Indenture Estate may be sold in one lot as an entirety or in
separate lots. The Indenture Trustee shall not be obligated to make any sale
pursuant to such notice. The Indenture Trustee may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for such
sale, and any such sale may be made at any time or place to which the same may
be so adjourned without further notice or publication; provided however, that if
-----------------
more than 3 months have elapsed since the most recent notice of any such sale,
the Indenture Trustee shall adjourn such sale and the Indenture Trustee shall
give notice to the Owner Trustee and the Owner Participant of the time and place
fixed for the next subsequent sale at least 10 days prior thereto. The Indenture
Trustee may
- 40 -
exercise such right of sale without possession or production of the Certificates
or proof of ownership thereof, and as representative of the Holders may exercise
such right without notice to the Holders or without including the Holders as
parties to any suit or proceedings relating to the foreclosure of any part of
the Indenture Estate. The Owner Trustee shall execute any and all such bills of
sale, assignments and other documents, and perform and do all other acts and
things requested by the Indenture Trustee in order to permit consummation of any
sale of the Indenture Estate in accordance with this Section 7.03(c) and to
effectuate the transfer or conveyance referred to in the first sentence of this
Section 7.03(c). Notwithstanding any other provision of this Indenture, the
Indenture Trustee shall not sell the Indenture Estate or any part thereof unless
the Certificates shall have been accelerated or shall have matured.
(d) To the extent permitted by applicable law, the Indenture Trustee
or any Holder may be a purchaser of the Indenture Estate or any part thereof or
any interest therein at any sale thereof, whether pursuant to foreclosure or
power of sale or otherwise. The Indenture Trustee may apply against the purchase
price therefor the amount then due hereunder or under any of the Certificates
secured hereby and any Holder may apply against the purchase price therefor the
amount then due to it hereunder, under any other Indenture Document or under the
Certificates held by such Holder to the extent that such portion of the purchase
price as it would have received had it been entitled to share any distribution
thereof. The Indenture Trustee or any Holder or nominee thereof shall, upon any
such purchase, acquire good title to the property so purchased, free of the Lien
of this Indenture and, to the extent permitted by applicable law, free of all
rights of redemption in the Owner Trustee or the Owner Participant in respect of
the property so purchased.
(e) Subject to Article VIII hereof and if an Indenture Event of
Default is continuing, the Owner Trustee hereby irrevocably appoints and
constitutes the Indenture Trustee the true and lawful attorney-in-fact of the
Owner Trustee in its name and stead and on its behalf, for the purpose of
effectuating any sale, assignment, transfer or delivery for the enforcement of
the Lien of this Indenture, whether pursuant to foreclosure or power of sale or
otherwise, to execute and deliver all such bills of sale, assignments and other
instruments as the Indenture Trustee may consider necessary or appropriate, with
full power of substitution, and Owner Trustee hereby ratifies and confirms all
that such attorney or any substitute shall lawfully do by virtue hereof.
Nevertheless, if so requested by the Indenture Trustee or any purchaser, the
Owner Trustee shall ratify and confirm any such sale, assignment, transfer or
delivery, by executing and delivering to the Indenture Trustee or such purchaser
all bills of sale, assignments, releases and other proper instruments to effect
such ratification and confirmation as may be designated in any such request.
- 41 -
(f) The Indenture Trustee shall, as a matter of right, be entitled to
the appointment of a receiver (who may be the Indenture Trustee or any successor
or nominee) for all or any part of the Indenture Estate, whether such
receivership be incidental to a proposed sale of the Indenture Estate or the
taking of possession thereof or otherwise, and the Owner Trustee hereby consents
to the appointment of such receiver and will not oppose any such appointment.
Any receiver appointed for all or any part of the Indenture Estate shall be
entitled to exercise all of the rights and powers of the Indenture Trustee with
respect to the Indenture Estate.
(g) Any sale of the Indenture Estate or any part thereof or any
interest therein, whether pursuant to foreclosure or power of sale or otherwise
hereunder, shall be a perpetual bar against the Owner Trustee after the
expiration of the period, if any, during which the Owner Trustee shall have the
benefit of redemption laws which may not be waived pursuant to Section 7.13
hereof.
SECTION 7.04. Indenture Trustee May Prove Debt. If the Owner Trustee
--------------------------------
shall fail to pay any amount payable hereunder or under the Certificates, the
Indenture Trustee, in its own name and as trustee of an express trust, shall be
entitled and empowered to institute any action or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Owner Trustee and collect in the manner
provided by law out of the property of the Owner Trustee wherever situated, the
moneys adjudged or decreed to be payable; provided, that any sale of any portion
---------
of the Indenture Estate shall be done in accordance with Section 7.03(c).
In case there shall be pending proceedings relative to the Trust Estate or
the Owner Trustee under the Bankruptcy Code or any other applicable Federal or
state bankruptcy, insolvency or other similar law, or in case a receiver,
assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or
similar official shall have been appointed for or taken possession of the Trust
Estate or the Owner Trustee or its property, or in case of any other comparable
judicial proceedings relative to the Trust Estate or the Owner Trustee, or to
the creditors or property of the Trust Estate or the Owner Trustee, the
Indenture Trustee, irrespective of whether the principal of the Certificates
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Indenture Trustee shall have made any
demand pursuant to the provisions of this Section, shall be entitled and
empowered, by intervention in such proceedings or otherwise:
(a) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Certificates, and
to file such other papers or
- 42 -
documents as may be necessary or advisable in order to have the claims of
the Indenture Trustee (including any claim for reasonable compensation to
the Indenture Trustee and each predecessor Indenture Trustee, and their
respective agents, attorneys and counsel, and for reimbursement of the
Indenture Trustee and each predecessor Indenture Trustee, except as a
result of negligence or bad faith) and of the Holders allowed in any
judicial proceedings relative to the Owner Trustee or to the creditors or
property of the Owner Trustee,
(b) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders in any election of a trustee or a standby trustee in
arrangement, reorganization, liquidation or other bankruptcy or insolvency
proceedings or person performing similar functions in comparable
proceedings, and
(c) to collect and receive any moneys or other property payable or
deliverable on any such claims, and to distribute all amounts received with
respect to the claims of the Holders and of the Indenture Trustee on their
behalf;
and any trustee, receiver, or liquidator, custodian or other similar official is
hereby authorized by each of the Holders to make payments to the Indenture
Trustee, and, in the event that the Indenture Trustee shall consent to the
making of payments directly to the Holders, to pay to the Indenture Trustee such
amounts as shall be sufficient to cover reasonable compensation to the Indenture
Trustee, each predecessor Indenture Trustee and their respective agents,
attorneys and counsel, and all other expenses and liabilities incurred, and all
advances made, by the Indenture Trustee and each predecessor Indenture Trustee
except as a result of negligence or bad faith.
Nothing contained herein shall be deemed to authorize the Indenture Trustee
to authorize or consent to or vote for or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Certificates or the rights of any Holder thereof, or to authorize
the Indenture Trustee to vote in respect of the claim of any Holder in any such
proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar person.
All rights of action and of asserting claims under this Indenture, or under
any of the Certificates, may be prosecuted and enforced by the Indenture Trustee
without the possession of any of the Certificates or the production thereof in
any trial or other proceedings relative thereto, and any such action or
proceedings instituted by the Indenture Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment, subject to the
payment of the expenses, disbursements and compensation of the Indenture
Trustee, each predecessor Indenture Trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Holders.
- 43 -
In any proceedings brought by the Indenture Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party) the Indenture Trustee shall be
held to represent all the Holders of the Certificates, and it shall not be
necessary to make any Holders parties to any such proceedings.
SECTION 7.05. Remedies Cumulative. Each and every right, power and remedy
-------------------
given to the Indenture Trustee or Holders specifically or otherwise in this
Indenture shall be cumulative and shall be in addition to every other right,
power and remedy specifically given herein or now or hereafter existing at law,
in equity or by statute, and each and every right, power and remedy whether
specifically given herein or otherwise existing may be exercised from time to
time and as often and in such order as may be deemed expedient by the Indenture
Trustee or the Holders, and the exercise or the beginning of the exercise of any
power or remedy shall not constitute or be construed to be a waiver of the right
to exercise at the same time or thereafter any other right, power or remedy. No
delay or omission by the Indenture Trustee or of any Holder in the exercise of
any right, remedy or power or in the pursuance of any remedy shall impair any
such right, power or remedy or be construed to be a waiver of any default on the
part of the Owner Trustee, the Owner Participant or the Lessee or to be an
acquiescence therein.
SECTION 7.06. Suits for Enforcement. If an Indenture Event of Default has
---------------------
occurred, has not been waived and is continuing, the Indenture Trustee may in
its discretion and subject to its rights of appropriate indemnification under
Sections 7.08 and 9.03 and Article XI hereof proceed to protect and enforce its
rights and rights of the Holders by such appropriate judicial proceedings as the
Indenture Trustee shall deem most effectual to protect and enforce any of such
rights, either at law or in equity or in bankruptcy or otherwise, whether for
the specific enforcement of any covenant or agreement contained in this
Indenture or in aid of the exercise of any power granted in this Indenture or to
enforce any other legal or equitable right vested in the Indenture Trustee or
the Holders by this Indenture or by law; provided, that any sale of any portion
--------
of the Indenture Estate shall be done in accordance with Section 7.03(c).
SECTION 7.07. Discontinuance of Proceedings. In case the Indenture
-----------------------------
Trustee or any Holder shall have instituted any proceeding to enforce any right,
power or remedy under this Indenture by foreclosure, entry or otherwise, and
such proceeding shall have been discontinued or abandoned for any reason or
shall have been finally determined adversely to the Indenture Trustee or such
Holder, then and in every such case the Owner Trustee, the Indenture Trustee,
the Holders and the Lessee shall, subject to any such determination in such
proceeding, be restored to their former positions and rights hereunder with
respect to the Indenture Estate, and all rights, remedies and powers of the
- 44 -
Indenture Trustee and the Holders shall continue as if no such proceeding had
been instituted.
SECTION 7.08. Limitations on Suits by Holders. No Holder of any
-------------------------------
Certificate shall have any right by virtue or by availing of any provision of
this Indenture to institute any action or proceeding at law or in equity or in
bankruptcy or otherwise upon or under or with respect to this Indenture, or for
the appointment of a trustee, receiver, liquidator, custodian or other similar
official or for any other remedy hereunder, unless such Holder previously shall
have given to the Indenture Trustee written notice of an Indenture Default and
of the continuance thereof, as hereinbefore provided, and the Holders of not
less than 25% in aggregate principal amount of Outstanding Certificates shall
have made written request upon the Indenture Trustee to institute such action or
proceedings in its own name or as trustee hereunder and shall have offered to
the Indenture Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby and the
Indenture Trustee for 60 days after its receipt of such notice, request and
offer of indemnity shall have failed to institute any such action or proceedings
and no direction inconsistent with such written request shall have been given to
the Indenture Trustee pursuant to Section 7.10; it being understood and
intended, and being expressly covenanted by the Holder of each Certificate with
every other Holder of each other Certificate and the Indenture Trustee, that no
one or more Holders shall have any right in any manner whatever to affect,
disturb or prejudice the rights of any other Holder or the Lien of this
Indenture or any part of the Indenture Estate or to obtain or seek to obtain
priority over or preference to any other such Holder or to enforce any right
under this Indenture, except in the manner provided herein and for the equal,
ratable and common benefit of all Holders. For the protection and enforcement of
the provisions of this Section, each and every Holder and the Indenture Trustee
shall be entitled to such relief as can be given either at law or in equity.
SECTION 7.09. Unconditional Right of Holders to Receive Principal,
----------------------------------------------------
Interest and Premium, and to Institute Certain Suits. Notwithstanding any other
- ----------------------------------------------------
provision in this Indenture and any provision of any Certificate, the right of
any Holder to receive payment of the principal of and interest and premium (if
any) on such Certificate on or after the respective due dates and in the manner
expressed in such Certificate, or, subject to Section 7.08, to institute suit
for the enforcement of any such payment on or after such respective dates as
provided herein, shall not be impaired or affected without the consent of such
Holder.
SECTION 7.10. Control by Holders. A Majority in Interest of Certificate
------------------
Holders shall have the right to direct the Indenture Trustee as to the time,
method, and place of conducting any proceeding for any remedy available to the
Indenture Trustee, or exercising any trust or power conferred on the Indenture
Trustee by this Indenture; provided that such direction shall not be
--------
- 45 -
otherwise than in accordance with law and the provisions of this Indenture and
the Indenture Trustee shall have received, to the extent provided in Sections
7.08 and 9.03 and Article XI hereof, such reasonable indemnification as it may
require against the costs, expenses and liabilities to be incurred by the
Indenture Trustee and provided further that (subject to the provisions of
----------------
Section 9.02) the Indenture Trustee shall have the right to decline to follow
any such direction if the Indenture Trustee, being advised by counsel, shall
determine that the action or proceeding so directed may not lawfully be taken or
if the Indenture Trustee in good faith by its board of directors, the executive
committee, or a trust committee of directors or Responsible Officers of the
Indenture Trustee shall determine that the action or proceedings so directed
would impose upon the Indenture Trustee personal liability or if the Indenture
Trustee in good faith shall so determine that the actions or forbearances
specified in or pursuant to such direction shall be unduly prejudicial to the
interests of Holders not joining in the giving of said direction, it being
understood that (subject to Section 9.02) the Indenture Trustee shall have no
duty to ascertain whether or not such actions or forbearances are unduly
prejudicial to such Holders.
Nothing in this Indenture shall impair the right of the Indenture Trustee
in its discretion to take any action deemed proper by the Indenture Trustee and
which is not inconsistent with such direction by Holders.
SECTION 7.11. Waiver of Past Indenture Defaults. Upon written
---------------------------------
instructions from a Majority in Interest of Certificate Holders, the Indenture
Trustee shall waive any past Indenture Default and its consequences and upon any
such waiver such Indenture Default shall cease to exist and any Indenture
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture, but no such waiver shall extend to any subsequent or other
Indenture Default or impair any right consequent thereon; provided, however,
------------------
that in the absence of written instructions from all Holders, the Indenture
Trustee shall not waive any Indenture Default (i) in the payment of the
principal of, or premium (if any) or interest on, or other amounts due under,
any Certificate then Outstanding, or (ii) in respect of a covenant or provision
hereof which, under Article XIII hereof, cannot be modified or amended without
the consent of each Holder and provided, further, that the Indenture Trustee
------------------
shall not waive any Indenture Default to the extent arising under Section
7.01(a) hereof because of the failure of the Lessee to pay any Excepted Payments
without the consent of the Owner Participant, or in the case of an Excepted
Payment owing to the Trust Company or the Indenture Trustee such party, and
shall waive any such Indenture Default upon the express written instructions of
the Owner Participant, or in the case of an Excepted Payment owing to the Trust
Company or the Indenture Trustee, such party, unless the Indenture Trustee or
the Holders would be adversely affected by such waiver.
- 46 -
SECTION 7.12. Notice of Indenture Defaults. The Indenture Trustee shall
----------------------------
transmit to the Owner Trustee, the Holders and to the Owner Participant notice
of all Indenture Defaults actually known to a Responsible Officer of the
Indenture Trustee, such notice to be transmitted by mail to the Holders within
90 days, and to the Owner Trustee and the Owner Participant promptly (within one
Business Day after a failure to pay Basic Rent), after the occurrence thereof,
unless such Indenture Default shall have been cured before the giving of such
notice; provided that under no circumstances shall the Indenture Trustee give
--------
such notice to the Holders until the earlier of the time at which such Indenture
Default becomes an Indenture Event of Default or the expiration of a period of
60 days from the occurrence of such Indenture Default; and provided further
----------------
that, except in the case of default in the payment of the principal of or
interest on or any other amount due under any of the Certificates, the Indenture
Trustee shall be protected in withholding such notice to the Holders if and so
long as the board of directors, the executive committee, or a trust committee of
directors or trustees and/or Responsible Officers of the Indenture Trustee in
good faith determines that the withholding of such notice is in the interests of
the Holders.
SECTION 7.13. Waiver of Appraisement, etc.; Laws. The Owner Trustee
----------------------------------
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any appraisement, valuation, stay, extension or
redemption law wherever enacted, now or at any time hereafter in force, in order
to prevent or hinder the enforcement of this Indenture or the execution of any
power granted herein to the Indenture Trustee, or the absolute sale of the
Indenture Estate, or any part thereof, or the possession thereof by any
purchaser at any sale under this Article VII; and the Owner Trustee for itself
and all who may claim under it, so far as it or any of them now or hereafter
lawfully may, hereby waives the benefit of all such laws. The Owner Trustee for
itself and all who may claim under it waives, to the extent that it lawfully
may, all right to have the property in the Indenture Estate marshalled upon any
foreclosure hereof, and agrees that any court having jurisdiction to foreclose
this Indenture may order the sale of the Indenture Estate as an entirety.
If any law referred to in this Section 7.13 and now in force, of which the
Owner Trustee or its successors might take advantage despite this Section 7.13,
shall hereafter be repealed or cease to be in force, such law shall not
thereafter be deemed to constitute any part of the contract herein contained or
to preclude the application of this Section 7.13.
- 47 -
ARTICLE VIII
RIGHTS OF THE OWNER TRUSTEE
AND THE OWNER PARTICIPANT
SECTION 8.01. Certain Rights of Owner Trustee and Owner Participant.
-----------------------------------------------------
Notwithstanding any other provision of this Indenture, including the Granting
Clause, the following rights shall be reserved to the Owner Trustee or the Owner
Participant, as the case may be (as separate and independent rights), to the
extent described herein:
(a) at all times the Owner Trustee shall have the right, together
with the Indenture Trustee, (i) to receive from the Lessee all notices,
certificates, reports, filings, opinions of counsel and other documents and
all information which the Lessee is permitted or required to give or
furnish to the Owner Trustee or the Lessor pursuant to any Indenture
Document, (ii) to exercise inspection rights pursuant to Section 12 of the
Lease; (iii) to exercise, to the extent permitted under Section 8.03
hereof, the rights of Lessor under Section 16 of the Lease; (iv) to retain
all rights with respect to insurance maintained for its own account and not
required pursuant to Section 11 of the Lease; and (v) separately, but not
to the exclusion of the Indenture Trustee, to give notice pursuant to
Section 14 of the Lease of a Lease Default or Lease Event of Default
thereunder;
(b) so long as no Indenture Event of Default shall have occurred and
be continuing, the Owner Trustee shall have the right (i) to the exclusion
of the Indenture Trustee, but subject to the provisions of Sections
13.07(a) and 13.07(c) hereof, (A) except as specified in clause (ii) below,
to exercise the rights, elections and options of the Lessor to make any
decision or determination and to give any notice, consent, waiver or
approval with respect to any adjustments of Basic Rent, Stipulated Loss
Value, Termination Value and EBO Percentage under Section 3(c) and 3(e) of
the Lease or with respect to renewal or purchase options or the return
condition of the Aircraft after the Term or any Renewal Term under Section
5 of the Lease and (B) to exercise all rights of the Lessor with respect to
solicitations of bids pursuant to Section 9 of the Lease, (ii) together
with the Indenture Trustee, to require the Lessee to take any action and
execute and deliver such documents and assurances as the "Lessor" may from
time to time reasonably request pursuant to Section 18 of the Lease and
(iii) together with the Indenture Trustee (agreement of both being required
in the case of (A), (B)(w) (with respect to additions to Exhibit B to the
Lease), and (C) below), (A) to grant such consents as may be requested
under the Lease, (B) to exercise (w) rights to accept or reject changes to
Exhibit B to the Lease, (x) rights to make bids on the Aircraft, (y) rights
to exercise discretion on Lessee's option to substitute a Replacement
Airframe
- 48 -
(together, if applicable, with a Replacement Engine or Engines) after an
Event of Loss pursuant to Section 10(a)(ii) of the Lease and (z) inspection
rights, pursuant to Sections 7(b), 9(a), 10(a) and 12 of the Lease,
respectively, and (C) to approve as satisfactory any accountants, engineers
or counsel to render services for or issue opinions to the Owner Trustee
pursuant to express provisions of the Indenture Documents;
(c) the Owner Trustee shall have the right, as the Lessor, to seek
specific performance of the covenants of the Lessee under the Lease
relating to the protection, insurance and maintenance of the Aircraft and
to maintain separate insurance with respect to the Aircraft pursuant to
Section 11 of the Lease;
(d) at all times and whether or not an Indenture Event of Default has
occurred and is continuing, each of the Owner Trustee, the Trust Company
and the Owner Participant shall have the right, to the exclusion of the
Indenture Trustee, to demand, collect, sue for or otherwise receive and
enforce the payment of Excepted Payments due and payable to it and, unless
the Lien of this Indenture shall have been foreclosed upon, to grant or
withhold its consent to amendments or supplements to Indenture Documents
required in accordance with Section 13.01 and 13.02 hereof; and
(e) at all times prior to the foreclosure of the Liens of this
Indenture the consent of the Owner Trustee shall be required to amend,
modify or supplement, directly or indirectly, Sections 1 (if any
modification of a definition contained therein would result in a
modification of the Lease not permitted by this clause (e)), 3, 4, 5, 6 (to
the extent such action would reduce the Lessee's obligations), 7, 8, 9, 10,
11, 12, 13, 14, 15, 16, 19, 20 or 21 of the Lease, or any other section of
the Lease (to the extent any amendment or supplement to, or modification
of, any such other section would, directly or indirectly, affect the amount
or timing of any amounts payable by the Lessee under the Lease (as such
Lease may have been modified with the consent of the Owner Trustee) which
amounts, absent the occurrence and continuance of an Indenture Event of
Default, will be distributable to the Owner Trustee hereunder).
SECTION 8.02. Owner Participant's Right to Elect to Redeem or Purchase the
------------------------------------------------------------
Certificates, and to Provide for Payment. (a) If at any time after a Lease
- ----------------------------------------
Event of Default has occurred and has continued for a period of (i) not more
than 180 days or (ii) at least 180 days, and provided that (A) no Indenture
Event of Default (that does not arise out of a Lease Event of Default) has
occurred and is continuing and (B) the Certificates shall not have become due
and payable as provided in Section 7.02(b) or 7.02(c) hereof, the Owner
Participant may, but shall be under no obligation to, direct the Owner Trustee
to cause the redemption or
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purchase of all but not less than all of the Certificates then Outstanding by
notifying the Indenture Trustee of such election, which notice in order to be
effective shall state that it is irrevocable and shall designate the Redemption
Date on which the Owner Trustee shall, in the manner provided for in Section
6.04 hereof, deposit with the Indenture Trustee the sum of the amounts
contemplated by paragraph "first" under Section 5.03 plus (x) in the case of a
-------
redemption or purchase pursuant to clause (a)(i) above the aggregate Redemption
Amount of all the Certificates plus interest thereon accrued to, but excluding,
the Redemption Date or (y) in the case of a redemption or purchase pursuant to
clause (a)(ii) above the aggregate Redemption Price of all the Certificates. The
Indenture Trustee shall notify each Holder of such redemption or purchase in the
manner provided for in Section 6.03 hereof.
(b) At any time while the Certificates shall have become due and
payable as provided in Section 7.02(b) or 7.02(c) hereof, the Owner Participant
may, but shall be under no obligation to, direct the Owner Trustee to pay to the
Indenture Trustee for distribution to the Holders in the manner provided for in
Section 5.01 hereof an amount equal to the sum of (i) amounts contemplated by
paragraph "first" under Section 5.03, (ii) the aggregate unpaid principal amount
-------
of all Outstanding Certificates, (iii) all accrued but unpaid interest thereon
to the date of payment and (iv) all other amounts due thereunder, but without
premium. The Owner Trustee shall give written notice of such payment to the
Indenture Trustee, which notice, in order to be effective, shall state that it
is irrevocable and shall designate a date not more than fourteen days thereafter
as the payment date. The Owner Trustee may in such notice elect to treat such
payment as a purchase of the Certificates by the Owner Participant. The
Indenture Trustee shall promptly notify each Holder of an Outstanding
Certificate of such payment. In the event of a redemption, (i) the Certificates
shall cease to accrue interest after the later of (1) such payment by the Owner
Trustee to the Indenture Trustee and (2) the Redemption Date; and (ii) after
distribution of such payment to the Holders, the Indenture Trustee shall release
the Indenture Estate from the Lien of this Indenture.
(c) In the event of a redemption, from and after the payment by the
Owner Trustee to the Indenture Trustee of the amount specified in Section
8.02(a) or 8.02(b), as the case may be, the Owner Trustee shall be entitled to
exercise all remedies of the Indenture Trustee under Article VII hereof as well
as of the Lessor under the Lease.
(d) If the Owner Trustee elects to purchase the Certificates under
Section 8.02(a) or (b) hereof, (i) nothing herein, including use of the terms
"Redemption Amount", "Redemption Price" and "Redemption Date" shall be deemed to
result in a redemption of the Certificates so purchased and (ii) no Holder shall
be liable to the Owner Trustee or Owner Participant
- 50 -
as a result of such purchase except to the extent such Holder would have been
liable if such purchase had been a redemption.
SECTION 8.03. Certain Rights of Owner Participant. If the Lessee shall
-----------------------------------
fail to make any payment of Basic Rent under the Lease within ten Business Days
after the same shall become due, and if such failure of the Lessee to make such
payment of Basic Rent shall not constitute the fourth or subsequent consecutive
such failure or the seventh or subsequent cumulative such failure, then as long
as no Indenture Event of Default (other than arising from such failure to pay
Basic Rent or any other Lease Event of Default) shall have occurred and be
continuing, the Owner Participant or the Owner Trustee may (but need not) pay to
the Indenture Trustee, at any time prior to the expiration of a period of 15
days after the expiration of ten Business Days after notice from the Indenture
Trustee to the Owner Trustee of such failure of Lessee to make payment of Basic
Rent (the "15-Day Period") (prior to the expiration of which 15-Day Period the
Indenture Trustee shall not declare the Lease in default pursuant to Section 15
thereof or exercise any of the rights, powers or remedies pursuant to such
Section 15 or Article VII hereof based solely on such failure to pay Basic
Rent), an amount equal to the full amount of such payment of Basic Rent,
together with any interest due thereon on account of the delayed payment
thereof, and such payment by the Owner Participant or the Owner Trustee shall be
deemed to cure any Indenture Event of Default which arose solely from such
failure of the Lessee to make a payment of Basic Rent (including the failure of
Lessee to pay such interest in respect of the delayed payment of Basic Rent from
and after the date the cure payment is made) (but such cure shall not relieve
the Lessee of any of its obligations). If the Lessee shall fail to perform or
observe any other covenant, condition or agreement to be performed or observed
by it under the Lease, and if (but only if) the performance or observance
thereof can be effected by the payment of money alone (it being understood that
actions such as the obtaining of insurance and the procurement of maintenance
services can be so effected), then as long as no other Indenture Event of
Default shall have occurred and be continuing (other than arising solely from
such failure by the Lessee which is being cured hereunder or from any other
Lease Event of Default), the Owner Participant or the Owner Trustee may (but
need not) pay to the Indenture Trustee (or to such other person as may be
entitled to receive the same), at any time prior to the expiration of a period
of 15 days after (i) in the case of a Lease Event of Default the grace period
for which was commenced by notice from the Holders or the Indenture Trustee,
receipt by the Owner Trustee or the Owner Participant of notice of such Lease
Event of Default, and (ii) in the case of any other Lease Event of Default, the
expiration of the grace period, if any, provided with respect to such failure on
the part of the Lessee in Section 14 of the Lease (prior to the expiration of
which 15-day period or, in the case of a Recently Cured Default (as defined
below), a five Business Day period in lieu thereof, the Indenture Trustee shall
not declare the Lease in default pursuant to Section 15 thereof or exercise any
of the rights,
- 51 -
powers or remedies pursuant to such Section 15 or Article VII hereof based
solely on such failure by the Lessee), all sums necessary to effect the
performance or observance of such covenant or agreement of the Lessee, together
with any interest due thereon on account of the delayed payment thereof, and
such payment by the Owner Participant or the Owner Trustee shall be deemed to
cure any Indenture Event of Default which arose solely from such failure of the
Lessee (but such cure shall not relieve the Lessee of any of its obligations);
provided, however, that if the Owner Trustee or the Owner Participant cures a
- ------------------
Lease Default or Lease Event of Default under Section 14(d) or 14(i) of the
Lease at any time prior to the earliest of any of a termination of the Lease, a
payment to the Indenture Trustee of any amount in excess of the amount then
overdue with respect to the Certificates (other than as a result of
acceleration) and a sale of any part of the Indenture Estate pursuant to Article
VII hereof, then upon such cure, if no other Indenture Event of Default shall be
continuing, any acceleration of the Certificates pursuant to Section 7.02(b) or
(c) hereof based solely on such cured Lease Default or Lease Event of Default
shall be automatically rescinded; provided, further, that the Indenture Trustee
agrees that it shall give the Owner Trustee and the Owner Participant not less
than 10 days notice prior to termination of the Lease following acceleration
where the immediately preceding proviso would otherwise be in effect. Upon any
payment of Basic Rent by the Owner Participant or the Owner Trustee in
accordance with the first sentence of this Section 8.03, or upon any payment of
any other sums by the Owner Participant or the Owner Trustee in accordance with
the second sentence of this Section 8.03, the Owner Participant or the Owner
Trustee shall, to the extent of their respective payments, be subrogated, in the
case of any such payment in accordance with such first sentence, to the rights
of the Indenture Trustee, as assignee hereunder of the Owner Trustee, or, in the
case of any such payment in accordance with such second sentence, to the rights
of the Indenture Trustee or such other person, as the case may be, which
actually received such payment, to receive such payment of Basic Rent or such
other payment, as the case may be (and any interest due thereon on account of
the delayed payment thereof), and shall be entitled to receive such payment upon
its receipt by the Indenture Trustee or such other person, as aforesaid (but in
each case only after all amounts of principal of, premium, if any, and interest
at the time due and payable on, or with respect to, the Certificates, together
with interest thereon on account of the delayed payment thereof shall have been
paid in full); provided that neither the Owner Participant nor the Owner Trustee
--------
shall attempt to recover any such amount paid by it on behalf of the Lessee
pursuant to this Section 8.03 except (i) by demanding of the Lessee payment of
such amount, (ii) by commencing an action against the Lessee to require the
payment of such amount pursuant to Section 15(e), but only said Section 15(e),
of the Lease or (iii) by realizing on a security interest in assets of the
Lessee (the fair market value of the security interest in such assets not to
exceed 110% of the amount so paid) to secure Lessee's reimbursement obligation
of such payment or by
- 52 -
commencing an action at law and obtaining and enforcing a judgment against the
Lessee for the payment of such amount; and provided further that at no time
----------------
while an Indenture Event of Default shall have occurred and be continuing shall
any such demand be made or shall any such action be commenced (or continued) or
any collateral security taken be realized upon, and any amounts nevertheless
received by the Owner Trustee or Owner Participant in respect thereof shall be
held in trust for the benefit of, and promptly paid to, the Indenture Trustee
for distribution as provided in Section 5.03 hereof. A "Recently Cured Failure"
means any failure by the Lessee which constitutes a Lease Event of Default under
Section 14(d) or 14(i) of the Lease if (i) within the preceding 12 month period
there shall have occurred a Lease Event of Default under the same Section of the
Lease and (ii) such Lease Event of Default referred to in clause (i) was cured
by the Owner Participant or the Owner Trustee later than during the 15-Day
period (or 5 Business Day period, as the case may be) after such failure became
a Lease Event of Default, which cure has lapsed without the Lessee then
performing its obligation to which the cured failure related.
ARTICLE IX
CONCERNING THE INDENTURE TRUSTEE
SECTION 9.01. Acceptance of Trusts. The Indenture Trustee hereby accepts
--------------------
the trusts imposed upon it by this Indenture, and covenants and agrees to
perform the same as expressed herein and agrees to receive and disburse all
moneys constituting part of the Indenture Estate in accordance with the terms
hereof.
SECTION 9.02. Duties and Responsibilities of the Indenture Trustee; During
------------------------------------------------------------
an Indenture Default; Prior to an Indenture Default. (a) The Indenture Trustee,
- ---------------------------------------------------
prior to the occurrence of an Indenture Event of Default and after the curing or
waiving of all Indenture Events of Default which may have occurred, undertakes
to perform such duties and only such duties as are specifically set forth in
this Indenture. In case an Indenture Event of Default has occurred (which has
not been cured or waived) the Indenture Trustee shall exercise such of the
rights and powers vested in it by this Indenture, and use the same degree of
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
No provision of this Indenture shall be construed to relieve the Indenture
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that:
(i) prior to the occurrence of an Indenture Event of Default and
after the curing or waiving of all Indenture Events of Default which may
have occurred:
- 53 -
(x) the duties and obligations of the Indenture Trustee shall be
determined solely by the express provisions of this Indenture, and the
Indenture Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read into
this Indenture against the Indenture Trustee; and
(y) in the absence of bad faith on the part of the Indenture
Trustee, the Indenture Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed
therein, upon any statements, certificates or opinions furnished to
the Indenture Trustee and conforming to the requirements of this
Indenture; but in the case of any such statements, certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Indenture Trustee, the Indenture Trustee shall be
under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture;
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Indenture Trustee, unless it shall be proved that the
Indenture Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect to any
action taken or not taken by it in good faith in accordance with the
direction of a Majority in Interest of Certificate Holders relating to the
time, method and place of conducting any proceeding for any remedy
available to the Indenture Trustee, or exercising any trust or power
conferred upon the Indenture Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Indenture Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if the Indenture Trustee shall have determined
in good faith that the repayment of such funds or adequate indemnity against
such liability is not reasonably assured to it.
The Indenture Trustee will execute and the Owner Trustee will file or cause
to be filed such continuation statements with respect to financing statements
relating to the security interest created hereunder in the Indenture Estate as
may be specified from time to time in written instructions of the Holders of not
less than 25% in aggregate principal amount of Outstanding Certificates (which
instructions may, by their terms, be operative only at a future date and which
shall be accompanied by the execution form of such continuation statement so to
be filed); provided that,
--------
- 54 -
notwithstanding the foregoing, the Indenture Trustee may execute and file or
cause to be filed any financing statement which it from time to time deems
appropriate.
(b) If any Lease Event of Default shall have occurred and be continuing
and Section 8.03 hereof shall either not apply or shall have ceased to apply
with respect thereto, on request of the Holders of not less than 25% in
aggregate principal amount of Outstanding Certificates and subject to
indemnification, to the extent provided in Sections 7.08 and 9.03 and Article XI
hereof, as it may require against the costs, expenses and liabilities to be
incurred, the Indenture Trustee shall exercise such remedies under Section 15 of
the Lease as shall be specified in such request.
(c) The Indenture Trustee agrees that it will, in its individual capacity
and at its own cost and expense (but without any right of indemnity in respect
of any such cost or expense under Article XI hereof) promptly take such action
as may be necessary to duly discharge all Liens on any part of the Indenture
Estate which result from claims against it in its individual capacity not
related to the administration of the Indenture Estate or any other transaction
pursuant to this Indenture or any document included in the Indenture Estate.
(d) The Indenture Trustee will execute and deliver to the Lessee for
filing in accordance with Section 18 of the Lease any properly presented
document, instrument or financing or continuation statement specified in any
opinion delivered pursuant to Section 12 of the Participation Agreement. The
Indenture Trustee may rely on the act of presentation of any such document,
instrument, financing or continuation statement as evidencing the fact that it
is properly prepared and presented, provided that the Indenture Trustee shall
--------
promptly correct any error in any such document, instrument, financing or
continuation statement of which a Responsible Officer of the Indenture Trustee
has actual knowledge.
SECTION 9.03. Certain Rights of the Indenture Trustee. Subject to Section
---------------------------------------
9.02:
(a) the Indenture Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, Officers' Certificate or any
other certificate, statement, instrument, opinion, report, notice, request,
consent, order, bond, debenture, note, coupon, security or other paper or
document reasonably believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request, direction, order or demand of the Owner Trustee
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed) upon
- 55 -
which the Indenture Trustee may rely to prove or establish a matter set
forth therein;
(c) the Indenture Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted to be taken by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(d) the Indenture Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it by this Indenture at the request,
order or direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Indenture Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred therein or thereby;
(e) the Indenture Trustee shall not be liable for any action taken or
omitted by it without gross negligence and in good faith and believed by it
to be authorized or within the discretion, rights or powers conferred upon
it by this Indenture;
(f) prior to the occurrence of an Indenture Event of Default
hereunder and after the curing or waiving of all Indenture Events of
Default, the Indenture 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, consent, order, approval,
appraisal, bond, debenture, note, coupon, security, or other paper or
document unless requested in writing to do so by a Majority in Interest of
Certificate Holders; provided that, if the payment within a reasonable time
--------
to the Indenture Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion of
the Indenture Trustee, not reasonably assured to the Indenture Trustee by
the security afforded to it by the terms of this Indenture, the Indenture
Trustee may require reasonable indemnity against such expenses or
liabilities as a condition to proceeding; the reasonable expenses of every
such examination shall be paid by the Owner Trustee or, if paid by the
Indenture Trustee or any predecessor trustee, shall be repaid by the Owner
Trustee upon demand; and
(g) the Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys not regularly in its employ and the Indenture Trustee
shall not be responsible for any misconduct or negligence on the part of
any such agent or attorney appointed with due care by it hereunder.
SECTION 9.04. Indenture Trustee Not Responsible for Recitals, Disposition
-----------------------------------------------------------
of Certificates or Application of Proceeds
- ------------------------------------------
- 56 -
Thereof. The Indenture Trustee assumes no responsibility for the correctness of
- -------
the recitals contained herein and in the Certificates, except the Indenture
Trustee's certificates of authentication. The Indenture Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Certificates. The Indenture Trustee shall not be accountable for the use or
application by the Owner Trustee of any of the Certificates or of the proceeds
thereof.
SECTION 9.05. Indenture Trustee and Agents May Hold Certificates;
---------------------------------------------------
Collections, etc. The Indenture Trustee or any agent of the Owner Trustee or
- -----------------
the Indenture Trustee, in its individual or any other capacity,
may become the owner or pledgee of Certificates with the same rights it would
have if it were not the Indenture Trustee or such agent and may otherwise deal
with the Owner Trustee and receive, collect, hold and retain collections from
the Owner Trustee with the same rights it would have if it were not the
Indenture Trustee or such agent.
SECTION 9.06. Moneys Held by Indenture Trustee. Subject to Sections 5.08
--------------------------------
and 14.04 hereof, all moneys received by the Indenture Trustee shall, until used
or applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Owner Trustee nor, subject
to Section 5.08, the Indenture Trustee nor any agent thereof shall be under any
liability for interest on any moneys received by it hereunder.
SECTION 9.07. Right of Indenture Trustee to Rely on Officers' Certificate,
------------------------------------------------------------
etc. Subject to Sections 9.02 and 9.03, whenever in the administration of the
- ----
trusts of this Indenture the Indenture Trustee shall deem it necessary or
desirable that a matter be proved or established prior to taking or suffering or
omitting any action hereunder, such matter (unless other evidence in respect
thereof be specifically prescribed herein) may, in the absence of bad faith on
the part of the Indenture Trustee, be deemed to be conclusively proved and
established by an Officers' Certificate delivered to the Indenture Trustee, and
such certificate, in the absence of bad faith on the part of the Indenture
Trustee, shall be full warrant to the Indenture Trustee for any action taken,
suffered or omitted by it under the provisions of this Indenture upon the faith
thereof.
SECTION 9.08. Replacement Airframes and Replacement Engines. At any time
---------------------------------------------
and from time to time any Airframe or Engine which has been subject to an Event
of Loss (or is treated as such pursuant to Section 9(b) of the Lease) and may,
or is required to, be replaced under Section 9(b), 10(a) or 10(b) of the Lease
by a Replacement Airframe or Replacement Engine, as the case may be, shall be
replaced in accordance with the provisions of this Section 9.08 and the
provisions of said Sections of the Lease, and the Owner Trustee shall, from time
to time, direct the Indenture Trustee to execute and deliver to or as directed
in writing by the
- 57 -
Owner Trustee an appropriate instrument releasing such Airframe and/or Engine as
appropriate from the Lien of this Indenture and the Indenture Trustee shall
execute and deliver such instrument as aforesaid without recourse or warranty,
but only upon receipt by or deposit with the Indenture Trustee of the following:
(1) A written request from the Owner Trustee requesting such release
and specifically describing the Airframe and/or Engine(s) to be so released.
(2) A certificate signed by a duly authorized officer of the Lessee
stating the following:
A. With respect to the replacement of any Airframe:
(i) a description of the Airframe including the manufacturer,
model, FAA registration number (or other applicable registration
information) and manufacturer's serial number;
(ii) a description of the Replacement Airframe, including the
manufacturer, model, FAA registration number (or other applicable
registration information) and manufacturer's serial number;
(iii) that on the date of the Trust Agreement and Trust Indenture
Supplement relating to the Replacement Airframe the Owner Trustee will be
the legal owner of such Replacement Airframe free and clear of all Liens
except Permitted Liens, that such Replacement Airframe will on such date be
in at least as good operating condition and repair as required by the terms
of the Lease, and that such Replacement Airframe has been or, substantially
concurrently with such replacement, will be duly registered in the name of
the Owner Trustee under the Act or under the law then applicable to the
registration of the Airframe and that an airworthiness certificate has been
duly issued under the Act (or such other applicable law) with respect to
such Replacement Airframe and that such registration and certificate is, or
will be, in full force and effect, and that the Lessee will have the full
right and authority to use such Replacement Airframe;
(iv) that the insurance required by Section 11 of the Lease is in
full force and effect with respect to such Replacement Airframe and all
premiums then due thereon have been paid in full;
(v) that the replacement Airframe is of the same or an improved
make or model as the Airframe requested to be released from this Indenture;
(vi) that the value and useful life of the Replacement Airframe
as of the date of such certificate is not less than the value and useful
life of the Airframe
- 58 -
requested to be released (assuming such Airframe was in the condition and
repair required to be maintained under the Lease);
(vii) that no Lease Event of Default, Lease Payment Default or
Lease Bankruptcy Default has occurred and is continuing or would result
from the making and granting of the request for release and the addition of
a Replacement Airframe;
(viii) that the release of the Airframe subject to the Event of
Loss will not impair the security of the Indenture in contravention of any
of the provisions of this Indenture;
(ix) that upon such replacement, the Lien of this Indenture will
apply to the Replacement Airframe and will constitute a first perfected
Lien thereon; and
(x) that each of the conditions specified in Section 10 of the
Lease with respect to such Replacement Airframe has been satisfied.
B. With respect to the replacement of any Engine:
(i) a description of the Engine including the manufacturer's
serial number;
(ii) a description of the Replacement Engine including the
manufacturer's name, the engine model and serial number;
(iii) that on the date of the Trust Agreement and Trust Indenture
Supplement relating to the Replacement Engine the Owner Trustee will be the
legal owner of such Replacement Engine free and clear of all Liens except
Permitted Liens, and that such Replacement Engine will on such date be in
at least as good operating condition and repair as required by the terms of
the Lease;
(iv) that the value of the Replacement Engine as of the date of
such certificate is not less than the value of the Engine to be released
(assuming such Engine was in the condition and repair required to be
maintained under the Lease);
(v) that the release of the Engine subject to the Event of Loss
will not impair the security of the Indenture in contravention of any of
the provisions of this Indenture;
(vi) that upon such replacement, the Lien of this Indenture will
apply to the Replacement Engine and will constitute a first perfected Lien
thereon; and
- 59 -
(vii) that each of the conditions specified in Section 10 of the
Lease with respect to such Replacement Engine has been satisfied.
(3) The appropriate instruments (i) transferring to the Owner Trustee
title to the Replacement Airframe or Replacement Engine to be received as
consideration for the Airframe or Engine to be released and (ii) assigning to
the Owner Trustee the benefit of all manufacturer's and vendor's warranties, if
any, generally available with respect to such Replacement Airframe or
Replacement Engine, and a Trust Agreement and Trust Indenture Supplement
subjecting such Replacement Airframe or Replacement Engine to the Trust
Agreement and to the Lien of this Indenture.
(4) A certificate from a firm of independent aircraft appraisers of
national standing satisfactory to the Indenture Trustee and the Owner Trustee
confirming the accuracy of the information set forth in clause (2)A.(vi) of this
Section 9.08.
(5) The opinion of Messrs. King & Spalding, special counsel to the
Lessee, or other counsel reasonably satisfactory to the Indenture Trustee,
stating that:
(i) the certificates, opinions and other instruments and/or property
which have been or are therewith delivered to and deposited with the
Indenture Trustee conform to the requirements of this Indenture and the
Lease and, upon the basis of such application, the property so sold or
disposed of may be properly released from the Lien of this Indenture and
all conditions precedent herein provided for relating to such release have
been complied with; and
(ii) the Replacement Airframe or Replacement Engine has been validly
subjected to the Lien of this Indenture and covered by the Lease, the
instruments subjecting such Replacement Airframe or Replacement Engine to
the Lease and to the Lien of this Indenture, as the case may be, have been
duly filed for recordation pursuant to the Act or any other law then
applicable to the registration of the Aircraft, and no further action,
filing or recording of any document is necessary or advisable in order to
establish and perfect the title of the Owner Trustee to and the Lien of
this Indenture on such Replacement Airframe or Replacement Engine.
SECTION 9.09. Trust Agreement and Trust Indenture Supplements for
---------------------------------------------------
Replacements. In the event of the substitution of a Replacement Airframe
- ------------
or a Replacement Engine as contemplated by Section 10 of the Lease, the Owner
Trustee and the Indenture Trustee agree for the benefit of the Holders and the
Lessee, subject to fulfillment of the conditions precedent and compliance by the
Lessee with its obligations set forth in Section 9(b) or 10 of the Lease, to
execute and deliver a Trust Agreement and Trust Indenture Supplement as
contemplated by Section 9.08(3) hereof and, provided no Lease Event of Default
shall have occurred and be
- 60 -
continuing, execute and deliver to the Lessee an appropriate instrument
releasing the Airframe or Engine being replaced from the Lien of this Indenture.
SECTION 9.10. Effect of Replacement. In the event of the substitution of
---------------------
a Replacement Airframe or a Replacement Engine as contemplated by Section 9(b)
or 10 of the Lease and Section 9.08 hereof, all provisions of this Indenture
relating to the Airframe or Engine or Engines being replaced shall be
applicable to such Replacement Airframe or Replacement Engine or Engines with
the same force and effect as if such Replacement Airframe or Replacement Engine
or Engines were the same airframe or engine or engines, as the case may be, as
the Airframe or Engine or Engines being replaced but for the Event of Loss with
respect to the Airframe or Engine or Engines being replaced.
SECTION 9.11. Compensation. The Owner Trustee covenants and
------------
agrees to pay, and the Indenture Trustee shall be entitled to receive,
reasonable compensation and payment or reimbursement for its reasonable
advances, expenses and disbursements (including the reasonable compensation and
expenses and disbursements of its counsel, agents and other persons not
regularly in its employ) in connection with its services rendered hereunder or
in any way relating to or arising out of the administration of the Indenture
Estate and shall have a priority claim on the Indenture Estate for the payment
of such compensation, advances, expenses and disbursements to the extent that
such compensation, advances, expenses and disbursements shall not be paid by the
Lessee on behalf of the Owner Trustee as Supplemental Rent, and shall have the
right to use or apply any moneys held by it hereunder in the Indenture Estate
toward such payments; provided that, so long as the Lease is in effect, the
--------
Indenture Trustee shall not make any claim for payment under this Section 9.11
against the Owner Trustee without first making demand on the Lessee for payment
of such claim unless stayed from so doing in a bankruptcy proceeding. The
Indenture Trustee agrees that it shall have no right against any Holder, the
Trust Company, in its individual capacity, or the Owner Participant for any fee
as compensation for its services as trustee under this Indenture.
ARTICLE X
CONCERNING THE HOLDERS
SECTION 10.01. Evidence of Action Taken by Holders. (a) Any
-----------------------------------
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing,
and, except as otherwise expressly provided herein, such action shall become
effective when such instrument or instruments are delivered to the Indenture
Trustee and, if expressly required herein, to the Owner
- 61 -
Trustee. Proof of execution of any instrument or of a writing appointing any
such agent shall be sufficient for any purpose of this Indenture and (subject to
Sections 9.02 and 9.03) conclusive in favor of the Indenture Trustee and the
Owner Trustee, if made in the manner provided in this Article.
(b) For the purpose of determining the Holders entitled to vote or
consent to any direction, waiver or other action of such Holders under Section
7.11 or 7.12, the Indenture Trustee may set a record date for such vote or
consent. Such record date shall be a date not more than 15 days prior to the
first solicitation of such vote or consent.
SECTION 10.02. Proof of Execution of Instruments and of Holding of
---------------------------------------------------
Certificates. Subject to Sections 9.02 and 9.03, the execution of any
- ------------
instrument by a Holder or his agent or proxy may be proved in accordance with
such reasonable rules and regulations as may be prescribed by the Indenture
Trustee. The holding of Certificates shall be proved by the Register or by a
certificate of the Registrar.
SECTION 10.03. Holders to Be Treated as Owners. Prior to due presentment
-------------------------------
for registration of transfer of any Certificate, the Owner Trustee, the
Indenture Trustee, any agent of the Owner Trustee or the Indenture Trustee, the
Paying Agent, if any, the Registrar and the Lessee may deem and treat the Person
in whose name such Certificate shall be registered upon the Register as the
absolute owner of such Certificate (whether or not such Certificate shall be
overdue and notwithstanding any notation of ownership or other writing thereon)
for the purpose of receiving payment of or on account of the principal of and,
subject to the provisions of this Indenture, interest on such Certificate and
for all other purposes; and neither the Owner Trustee nor the Indenture Trustee
(nor any agent of the Owner Trustee or the Indenture Trustee) nor the Paying
Agent, if any, nor the Registrar nor the Lessee shall be affected by any notice
to the contrary. All such payments so made to any such person, or upon his
order, shall be valid, and, to the extent of the sum or sums so paid, effectual
to satisfy and discharge the liability for moneys payable upon any such
Certificate.
SECTION 10.04. Certificates Owned by Owner Trustee and the Lessee Deemed
---------------------------------------------------------
Not Outstanding. In determining whether the Holders of the requisite aggregate
- ----------------
principal amount of Certificates have concurred in any direction, consent or
waiver under this Indenture, Certificates which are owned by the Owner Trustee,
the Owner Participant, the Lessee or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Owner Trustee, the Owner Participant or the Lessee shall be disregarded and
deemed not to be Outstanding for the purpose of any such determination; provided
--------
that for the purpose of determining whether the Indenture Trustee shall be
protected in relying on any such direction, consent or waiver, only if a
Responsible Officer of the Indenture Trustee has
- 62 -
actual knowledge that certain Certificates are so owned shall such Certificates
be so disregarded; and provided further that if all Certificates which would be
-------
deemed Outstanding in the absence of the foregoing provision are owned by the
Owner Trustee, the Owner Participant or the Lessee or by any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Owner Trustee, the Owner Participant or the Lessee, then such
Certificates shall be deemed Outstanding for the purpose of any such
determination. Certificates so owned which have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Indenture Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not the Owner Trustee, the Owner
Participant or the Lessee or any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Owner Trustee
or the Lessee. In case of a dispute as to such right, the advice of counsel
shall be full protection in respect of any decision made by the Indenture
Trustee in accordance with such advice. Upon request of the Indenture Trustee,
the Owner Trustee, the Owner Participant and the Lessee shall furnish to the
Indenture Trustee promptly an Officers' Certificate listing and identifying all
Certificates, if any, known by the Owner Trustee, the Owner Participant or the
Lessee to be owned or held by or for the account of any of the above-described
persons; and, subject to Sections 9.02 and 9.03, the Indenture Trustee shall be
entitled to accept such Officers' Certificate as conclusive evidence of the
facts set forth therein and of the fact that all Certificates not listed therein
are outstanding for the purpose of any such determination.
SECTION 10.05. Right of Revocation of Action Taken. At any time prior
-----------------------------------
to (but not after) the evidencing to the Indenture Trustee, as provided in
Section 10.01, of the taking of any action by the Holders of the percentage in
aggregate principal amount of the Certificates specified in this Indenture in
connection with such action, any Holder of a Certificate, the serial number of
which is shown by the evidence to be included among the serial numbers of the
Certificates the Holders of which have consented to such action, may, by filing
written notice at the Corporate Trust Office and upon proof of holding as
provided in this Article, revoke such action so far as concerns such
Certificate. Except as aforesaid, any such action taken by the Holder shall be
conclusive and binding upon such Holder and upon all future Holders and owners
of such Certificate and of any Certificates issued in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon any such Certificate or otherwise. Any action taken by the Holders of the
percentage in aggregate principal amount of the Certificates specified in this
Indenture in connection with such action shall be conclusively binding upon the
Owner Trustee, the Indenture Trustee and the Holders of all the Certificates.
SECTION 10.06. ERISA Plan Prohibition. No employee benefit plan subject
----------------------
to Title I of the Employee Retirement Income Security
- 63 -
Act of 1974, as amended ("ERISA"), or individual retirement account or employee
benefit plan subject to Section 4975 of the Internal Revenue Code of 1986, as
amended, (hereinafter collectively referred to as an "ERISA Plan") may acquire
or hold any of the Certificates. The purchase by any person of any Certificate
constitutes a representation by such person to the Lessee, the Owner
Participant, the Owner Trustee and the Indenture Trustee that such person is not
an ERISA Plan and that such person is not acquiring, and has not acquired, such
Certificate with assets of an ERISA Plan.
ARTICLE XI
INDEMNIFICATION OF INDENTURE
TRUSTEE BY OWNER TRUSTEE
The Owner Trustee, not individually but solely in its
capacity as Owner Trustee under the Trust Agreement, hereby agrees, whether or
not any of the transactions contemplated hereby shall be consummated, to assume
liability for, and does hereby indemnify, protect, save and keep harmless the
Indenture Trustee, in its individual capacity, and its successors, assigns,
agents and servants solely from the Trust Estate, with respect to the claims of
the Indenture Trustee for payment or reimbursement under Section 9.11 hereof and
from and against any and all liabilities, obligations, losses, damages,
penalties, taxes (excluding any taxes payable by the Indenture Trustee on or
measured by any compensation received by the Indenture Trustee for its services
under this Indenture), claims, actions, suits, costs, expenses or disbursements
(including legal fees and expenses) of any kind and nature whatsoever which may
be imposed on, incurred by or asserted against the Indenture Trustee in its
individual capacity (whether or not also agreed to be indemnified against by any
other person under any other document) in any way relating to or arising out of
this Indenture, or any other Indenture Documents or the enforcement of any of
the terms of any thereof, or in any way relating to or arising out of the
manufacture, design, purchase, acceptance, nonacceptance, rejection, ownership,
registration, re-registration, delivery, redelivery, lease, possession, use,
operation, condition, sale, return or other disposition of the Aircraft or any
Engine (including, without limitation, latent and other defects, whether or not
discoverable, and any claim for patent, trademark or copyright infringement), or
in any way relating to or arising out of the administration of the Indenture
Estate or the action or inaction of the Indenture Trustee hereunder, except only
(i) in the case of willful misconduct or gross negligence of the Indenture
Trustee in the performance of its duties hereunder, (ii) as may result from the
inaccuracy of any representation or warranty of the Indenture Trustee in the
Participation Agreement, (iii) as otherwise provided in Section 9.02(c) hereof
or (iv) as otherwise excluded by the terms of Section 6(b) or 6(c) of the
Participation Agreement from the Lessee's general indemnity to the Indenture
Trustee under said
- 64 -
Section; provided that so long as the Lease is in effect, the Indenture Trustee
--------
shall not make any claim under this Article XI for any claim or expense
indemnified by the Lessee under the Participation Agreement without first making
demand on the Lessee for payment of such claim or expense unless the Indenture
Trustee is enjoined or is otherwise prevented by law from making such demand.
The Indenture Trustee in its individual capacity shall be entitled to
indemnification, from the Indenture Estate, for any liability, obligation, loss,
damage, penalty, claim, action, suit, cost, expense or disbursement indemnified
against pursuant to this Article XI to the extent not reimbursed by the Lessee
or others, but without releasing any of them from their respective agreements of
reimbursement; and to secure the same the Indenture Trustee shall have a prior
Lien on the Indenture Estate. The indemnities contained in this Article XI shall
survive the termination of this Indenture and the resignation or removal of the
Indenture Trustee. Upon payment in full by the Owner Trustee of any indemnity
pursuant to this Article XI, the Owner Trustee shall be subrogated to the rights
of the Indenture Trustee, if any, in respect of the matter as to which the
indemnity was paid.
ARTICLE XII
SUCCESSOR TRUSTEES
SECTION 12.01. Notice of Successor Owner Trustee. In the case of any
---------------------------------
appointment of a successor to the Owner Trustee pursuant to the Trust Agreement
or any merger, conversion, consolidation or sale of substantially all of the
corporate trust business of the Owner Trustee pursuant to the Trust Agreement,
the successor Owner Trustee shall give prompt written notice thereof to the
Indenture Trustee.
SECTION 12.02. Resignation and Removal of Indenture Trustee; Appointment
---------------------------------------------------------
of Successor. (a) The Indenture Trustee or any successor thereto may resign at
- ------------
any time without cause by giving at least 30 days' prior written notice to the
Owner Trustee, the Owner Participant, the Lessee and each Holder, such
resignation to be effective upon the acceptance of the trusteeship by a
successor Indenture Trustee. In addition, a Majority in Interest of Certificate
Holders, or the Owner Trustee, with the consent of the Lessee (so long as no
Lease Default is then continuing) and a Majority in Interest of Certificate
Holders, may at any time remove the Inde nture Trusteewithout cause by an
instrument in writing delivered to the Lessee, the Owner Trustee, the Owner
Participant, and the Indenture Trustee, and the Indenture Trustee shall promptly
notify each Holder thereof in writing, such removal to be effective upon the
acceptance of the trusteeship by a successor Indenture Trustee. In the case of
the resignation or removal of the Indenture Trustee, a Majority in Interest of
Certificate Holders, or the Owner Trustee, with the consent of the Lessee (so
long as no Lease Default is then continuing) and a Majority in Interest of
Certificate Holders may appoint a
- 65 -
successor Indenture Trustee by an instrument signed by such Holders. If a
successor Indenture Trustee shall not have been appointed within 90 days after
such notice of resignation or removal, the Indenture Trustee, the Owner Trustee,
the Lessee, the Owner Participant, or any Holder may apply to any court of
competent jurisdiction to appoint a successor Indenture Trustee to act until
such time, if any, as a successor shall have been appointed as provided above.
The successor Indenture Trustee so appointed by such court shall immediately and
without further act be superseded by any successor Indenture Trustee appointed
as provided above within one year from the date of the appointment by such
court.
(b) In case at any time any of the following shall occur:
(i) the Indenture Trustee shall cease to be eligible in
accordance with the provisions of Section 12.03 and shall fail to resign
after written request therefor by the Owner Trustee or by any such Holder;
or
(ii) the Indenture Trustee shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver or liquidator of
the Indenture Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Indenture Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation;
then the Owner Trustee may remove the Indenture Trustee and, with the consent of
the Lessee (so long as no Lease Default is then continuing), appoint a successor
trustee by written instrument, in duplicate, executed by a Responsible Officer
of the Owner Trustee, one copy of which instrument shall be delivered to the
Indenture Trustee so removed and one copy to the successor trustee, or any
Holder who has been a bona fide Holder for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Indenture Trustee and the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, remove the Indenture Trustee and appoint a
successor trustee, which removal and appointment shall become effective upon
acceptance of appointment by the successor trustee as provided in Section 12.04.
The successor Indenture Trustee so appointed by such court shall immediately and
without further act be superseded by any successor Indenture Trustee appointed
as provided above within one year from the date of appointment by such court.
SECTION 12.03. Persons Eligible for Appointment as Indenture
---------------------------------------------
Trustee. There shall at all times be an Indenture Trustee
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hereunder which shall be a corporation organized and doing business under the
laws of the United States of America or of any State or the District of Columbia
having a combined capital and
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surplus of at least $100,000,000, or a direct or indirect subsidiary of such a
corporation, or a member of a bank holding company group, having a combined
capital and surplus of at least $100,000,000 in either case the obligations of
which under the Operative Documents are fully and unconditionally guaranteed by
a corporation organized and existing under the laws of the United States of
America or of any State or the District of Columbia having a combined capital
and surplus of at least $100,000,000 and such subsidiary or member itself having
a capital and surplus of at least $75,000,000, if there is such an institution
willing, able and legally qualified to perform the duties of the Indenture
Trustee hereunder upon reasonable and customary terms. Such corporate trustee
shall be a citizen of the United States as defined in Section 101(16) of the
Act, and shall be authorized under such laws to exercise corporate trust powers
and shall be subject to supervision of examination by Federal, State or District
of Columbia authority. If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. In case at any time the Indenture Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Indenture
Trustee shall resign immediately in the manner and with the effect specified in
Section 12.02.
SECTION 12.04. Acceptance of Appointment by Successor Trustee. Any
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successor trustee appointed as provided in Section 12.02 shall execute and
deliver to the Owner Trustee, the Lessee, and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested with
all rights, powers, duties and obligations of its predecessor hereunder, with
like effect as if originally named as trustee herein; but, nevertheless, on the
written request of the Owner Trustee or of the successor trustee, upon payment
of its charges then unpaid, the trustee ceasing to act shall, subject to Section
14.04, pay over to the successor trustee all moneys at the time held by it
hereunder and shall execute and deliver an instrument transferring to such
successor trustee all such rights, powers, duties and obligations. Upon request
of any such successor trustee, the Owner Trustee shall execute any and all
instruments in writing for more fully and certainly vesting in and confirming to
such successor trustee all such rights and powers. Any trustee ceasing to act
shall, nevertheless, retain a prior claim upon all property or funds held or
collected by such trustee to secure any amounts then due it pursuant to the
provisions of Article XI.
No successor trustee shall accept appointment as provided in this Section
12.04 unless at the time of such acceptance such
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successor trustee shall be eligible under the provisions of Section 12.03.
Upon acceptance of appointment by a successor trustee as provided in this
Section 12.04, the successor trustee shall mail notice thereof by first-class
mail to the Holders at their last addresses as they shall appear in the
Register, and shall mail a copy of such notice to the Lessee and the Owner
Trustee. If the acceptance of appointment is substantially contemporaneous with
the resignation, then the notice called for by the preceding sentence may be
combined with the notice called for by Section 12.02.
SECTION 12.05. Merger, Conversion, Consolidation or Succession to Business
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of Indenture Trustee. Any corporation into which the Indenture Trustee may be
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merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Indenture
Trustee shall be a party, or any corporation succeeding to the corporate trust
business of the Indenture Trustee, shall be the successor to the Indenture
Trustee hereunder, provided that, anything herein to the contrary
notwithstanding, such corporation shall be eligible under the provisions of
Section 12.03, without the execution or filing of any paper or any further act
on the part of any of the parties hereto.
In case at the time such successor to the Indenture Trustee shall succeed
to the trusts created by this Indenture any of the Certificates shall have been
authenticated but not delivered, any such successor to the Indenture Trustee may
adopt the certificate of authentication of any predecessor Indenture Trustee and
deliver such Certificates so authenticated; and, in case at that time any of the
Certificates shall not have been authenticated, any successor to the Indenture
Trustee may authenticate such Certificates either in the name of any predecessor
hereunder or in the name of the successor Indenture Trustee; and in all such
cases such certificate shall have the full force which it is anywhere in the
Certificates or in this Indenture provided that the certificate of the Indenture
Trustee shall have; provided, that the right to adopt the certificate of
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authentication of any predecessor Indenture Trustee or to authenticate
Certificates in the name of any predecessor Indenture Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.
SECTION 12.06. Appointment of Separate Trustees. (a) At any time or
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times, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Indenture Estate may at the time be located or in which
any action of the Indenture Trustee may be required to be performed or taken,
the Indenture Trustee, by an instrument in writing signed by it, may appoint one
or more individuals or corporations to act as separate trustee or separate
trustees or co-trustee, acting jointly with the Indenture Trustee, of all or any
part of the Indenture Estate, to the full
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extent that local law makes it necessary for such separate trustee or separate
trustees or co-trustee acting jointly with the Indenture Trustee to act.
(b) The Indenture Trustee and, at the request of the Indenture Trustee,
the Owner Trustee, shall execute, acknowledge and deliver all such instruments
as may be required by the legal requirements of any jurisdiction or by any such
separate trustee or separate trustees or co-trustee for the purpose of more
fully confirming such title, rights or duties to such separate trustee or
separate trustees or co-trustee. Upon the acceptance in writing of such
appointment by any such separate trustee or separate trustees or co-trustee, it,
he or they shall be vested with such title to the Indenture Estate or any part
thereof, and with such rights, powers, duties and obligations, as shall be
specified in the instrument of appointment, and such rights, powers, duties and
obligations shall be conferred or imposed upon and exercised or performed by the
Indenture Trustee, or the Indenture Trustee and such separate trustee or
separate trustees or co-trustee jointly with the Indenture Trustee subject to
all the terms of this Indenture, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed the
Indenture Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations shall be
exercised and performed by such separate trustee or separate trustees or co-
trustee, as the case may be. Any separate trustee or separate trustees or co-
trustee may, at any time by an instrument in writing, constitute the Indenture
Trustee its or his attorney-in-fact and agent with full power and authority to
do all acts and things and to exercise all discretion on its or his behalf and
in its or his name. In case any such separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, the title to the Indenture
Estate and all assets, property, rights, powers, duties and obligations and
duties of such separate trustee or co-trustee shall, so far as permitted by law,
vest in and be exercised by the Indenture Trustee, without the appointment of a
successor to such separate trustee or co-trustee unless and until a successor is
appointed.
(c) All provisions of this Indenture which are for the benefit of the
Indenture Trustee (including without limitation Article XI hereof) shall extend
to and apply to each separate trustee or co-trustee appointed pursuant to the
foregoing provisions of this Section 12.06.
(d) Every additional trustee and separate trustee hereunder shall, to
the extent permitted by law, be appointed and act and the Indenture Trustee
shall act, subject to the following provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon
the Indenture Trustee in respect of the
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receipt, custody, investment and payment of moneys shall be exercised
solely by the Indenture Trustee;
(ii) all other rights, powers, duties and obligations conferred
or imposed upon the Indenture Trustee shall be conferred or imposed and
exercised or performed by the Indenture Trustee and such additional trustee
or trustees and separate trustee or trustees jointly except to the extent
that under any law of any jurisdiction in which any particular act or acts
are to be performed, the Indenture Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the
Indenture Estate in any such jurisdiction) shall be exercised and performed
by such additional trustee or trustees or separate trustee or trustees;
(iii) no power hereby given to, or exercisable by, any such
additional trustee or separate trustee shall be exercised hereunder by such
additional trustee or separate trustee except jointly with, or with the
consent of, the Indenture Trustee; and
(iv) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder.
If at any time the Indenture Trustee shall deem it no longer necessary or
prudent in order to conform to any such law, the Indenture Trustee shall execute
and deliver an indenture supplemental hereto and all other instruments and
agreements necessary or proper to remove any additional trustee or separate
trustee.
(e) Any request, approval or consent in writing by the Indenture
Trustee to any additional trustee or separate trustee shall be sufficient
warrant to such additional trustee or separate trustee, as the case may be, to
take such action as may be so requested, approved or consented to.
(f) Notwithstanding any other provision of this Section 12.06, the
powers of any additional trustee or separate trustee shall not exceed those of
the Indenture Trustee hereunder.
ARTICLE XIII
SUPPLEMENTS AND AMENDMENTS TO THIS
INDENTURE AND OTHER DOCUMENTS
SECTION 13.01. Supplemental Indentures Without Consent of Holders. The
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Owner Trustee (when authorized by the Owner Participant) and the Indenture
Trustee (without the consent of any
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Holder) may enter into an indenture or indentures supplemental hereto for one or
more of the following purposes:
(a) to convey, transfer, assign, mortgage or pledge any property or
assets to the Indenture Trustee as security for the Certificates;
(b) to evidence the succession of another corporation to the Owner
Trustee or successive successions, and the assumption by the successor
corporation of the covenants, agreements and obligations of the Owner
Trustee herein and in the Certificates;
(c) to add to the covenants of the Owner Trustee such further
covenants, restrictions, conditions or provisions as consented to by the
Owner Participant and as they and the Indenture Trustee shall consider to
be for the protection of the Holders, and to make the occurrence, or the
occurrence and continuance, of a default in any such additional covenants,
restrictions, conditions or provisions an Indenture Event of Default
permitting the enforcement of all or any of the several remedies provided
herein; provided, that in respect of any such additional covenant,
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restriction, condition or provision such supplemental indenture may provide
for a particular period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults) or may provide
for an immediate enforcement upon such an Indenture Event of Default or may
limit the remedies available to the Indenture Trustee upon such an
Indenture Event of Default or may limit the right of the Holders of not
less than a majority in aggregate principal amount of the Certificates to
waive such an Indenture Event of Default;
(d) to surrender any rights or power conferred herein upon the Owner
Trustee or the Owner Participant;
(e) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any
supplemental indenture; or to make such other provisions in regard to
matters or questions arising under this Indenture or under any supplemental
indenture as the Owner Trustee may deem necessary or desirable and which
shall not adversely affect the interests of the Holders;
(f) to correct or amplify the description of any property at any time
subject to the Lien of this Indenture or better to assure, convey and
confirm unto the Indenture Trustee any property subject or required to be
subject to the Lien of this Indenture or to subject Replacement Airframes
or Replacement Engines to the Lien of this Indenture in accordance with the
provisions hereof or with the Lease or to
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release from the Lien of this Indenture property that has been substituted
on or removed from the Aircraft as contemplated in Section 3.07 hereof;
provided that supplements to this Indenture entered into for the purpose of
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subjecting Replacement Airframes or Replacement Engines to the Lien of this
Indenture need only be executed by the Owner Trustee and the Indenture
Trustee;
(g) to effect the re-registration of the Aircraft pursuant to Section
19 of the Participation Agreement; and
(h) to add, eliminate or change any provision hereunder so long as
such action shall not adversely affect the interests of the Holders.
The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture, to make any further appropriate agreements and
stipulations which may be contained therein and to accept the conveyance,
transfer, assignment, mortgage or pledge of any property thereunder, but the
Indenture Trustee shall not be obligated to enter into any such supplemental
indenture which adversely affects the Indenture Trustee's own rights, duties or
immunities under this Indenture or otherwise, whether in its trust or individual
capacity.
SECTION 13.02. Supplemental Indentures With Consent of Holders. With the
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consent (evidenced as provided in Article X) of a Majority in Interest of
Certificate Holders, the Owner Trustee (when authorized by the Owner
Participant) and the Indenture Trustee may, from time to time and at any time,
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of modifying in
any manner the rights of the Holders; provided, however, that, without the
-----------------
consent of each Holder, no such amendment of or supplement to this Indenture or
any indenture supplemental hereto, or modification of the terms of, or consent
under, any thereof, shall (a) modify any of the provisions of Section 7.11 or
this Section 13.02, (b) reduce the amount or extend the time of payment of any
amount owing or payable under any Certificate or reduce the interest payable on
any Certificate (except that only the consent of the Holder shall be required
for any decrease in any amounts of or the rate of interest payable on such
Certificate or any extension for the time of payment of any amount payable under
such Certificate), or alter or modify the provisions of Article V hereof with
respect to the order of priorities in which distributions thereunder shall be
made as between the Holder and the Owner Trustee or the Owner Participant or
with respect to the amount or time of payment of any such distribution, or alter
or modify the circumstances under which a premium shall be payable, or alter the
currency in which any amount payable under any Certificate is to be paid, or
impair the right of any Holder to commence legal proceedings to enforce a right
to receive payment hereunder, (c) reduce, modify or amend
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any indemnities in favor of any Holder or in favor of or to be paid by the Owner
Trustee (except as consented to by each Person adversely affected thereby), or
(d) create or permit the creation of any Lien on the Indenture Estate or any
part thereof prior to or pari passu with the Lien of this Indenture, except as
expressly permitted herein, or deprive any Holder of the benefit of the Lien of
this Indenture on the Indenture Estate, except as provided in Section 7.02
hereof or in connection with the exercise of remedies under Article VII. This
Section 13.02 shall not apply to any indenture or indentures supplemental hereto
permitted by, and complying with the terms of, Section 13.06 hereof.
Upon the request of the Owner Trustee (at the direction of the Owner
Participant) and upon the filing with the Indenture Trustee of evidence of the
consent of Holders and other documents, if any, required by Section 10.01, the
Indenture Trustee shall join with the Owner Trustee in the execution of such
supplemental indenture unless such supplemental indenture affects the Indenture
Trustee's own rights, duties or immunities under this Indenture or otherwise, in
which case the Indenture Trustee may in its discretion, but shall not be
obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such consent shall approve the substance thereof.
Promptly after the execution by the Owner Trustee and the Indenture Trustee
of any supplemental indenture pursuant to the provisions of this Section, the
Indenture Trustee shall mail a notice thereof by first-class mail to the Holders
at their addresses as they shall appear on the registry books of the Registrar,
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Indenture Trustee to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental indenture.
SECTION 13.03. Effect of Supplemental Indenture. Upon the execution of
--------------------------------
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Indenture Trustee, the Owner Trustee, the Lessee and
the Holders shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments, and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.
SECTION 13.04. Documents to Be Given to Indenture Trustee. The Indenture
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Trustee, subject to the provisions of Sections 9.02
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and 9.03, may receive an Officers' Certificate and an Opinion of Counsel as
conclusive evidence that any such supplemental indenture complies with the
applicable provisions of this Indenture.
SECTION 13.05. Notation on Certificates in Respect of Supplemental
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Indentures. Certificates authenticated and delivered after the execution of any
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supplemental indenture pursuant to the provisions of this Article may bear a
notation in form approved by the Indenture Trustee as to any matter provided for
by such supplemental indenture. If the Owner Trustee or the Indenture Trustee
shall so determine, new Certificates so modified as to conform, in the opinion
of the Owner Trustee and the Indenture Trustee, to any modification of this
Indenture contained in any such supplemental indenture may be prepared by the
Owner Trustee, authenticated by the Indenture Trustee and delivered in exchange
for the Outstanding Certificates.
SECTION 13.06. No Request Necessary for Lease Supplement or Trust
--------------------------------------------------
Agreement and Trust Indenture Supplement. Notwithstanding anything contained in
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Section 13.02 hereof, no written request or consent of the Indenture Trustee,
any Holder or the Owner Participant pursuant to Section 13.02 hereof shall be
required to enable the Owner Trustee to enter into any supplement to the Lease
with the Lessee pursuant to the terms of the Lease to subject an Aircraft or
other property thereto.
SECTION 13.07. Amendments, Waivers, etc. of Other Indenture Documents.
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(a) Without the consent of a Majority in Interest of Certificate Holders, the
respective parties to the Participation Agreement, the Lease and the Trust
Agreement may not modify, amend or supplement any of said agreements, or give
any consent, waiver, authorization or approval thereunder, for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions thereof or of modifying in any manner the rights of the respective
parties thereunder; provided, however, that the actions specified in subsection
-----------------
(b) of this Section 13.07 may be taken without the consent of any Holder.
(b) The Participation Agreement, the Lease and the Trust Agreement
may, at any time and from time to time, be amended or supplemented without the
consent of any Holder:
(i) to effect any modification, amendment, addition or deletion
expressly provided for in the Lease, the Participation Agreement or the
Trust Agreement (including, without limitation, Section 3 of the Lease but
excluding any provisions describing the manner in which such Operative
Document may be amended or modified);
(ii) to effect any modification or amendment of, addition to or
deletion from the Lease, the Participation Agreement or the Trust Agreement
if, as reflected in an Opinion of Counsel pursuant to Section 13.07(d) to
the party
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requesting such action addressed to the other parties to the applicable
agreement, such modification, amendment, addition or deletion shall not
adversely affect the interests of Holders; or
(iii) for the purpose of adding any provisions to or changing in
any matter or eliminating any of the provisions thereof or of modifying in
any manner the rights of the respective parties thereunder, with respect to
the following provisions of the Lease: Section 3(a) solely with respect to
modifying the length of the Term of the Lease (except if the result thereof
would be to shorten the Term of the Lease to a period shorter than the
period ending with the date of Maturity of the Certificates) and Section
3(a) solely with respect to modifying Basic Rent (but only to the extent
such Section relates to amounts payable (whether directly or pursuant to
the Indenture) to Persons other than Holders and the Indenture Trustee),
Section 3(d) (but only insofar as it relates to the address or account
information of the Owner Trustee or the Indenture Trustee) (as to
modifications to Sections 3(a) and 3(d), including as such Sections 3(a)
and 3(d) may be amended pursuant to Section 3(c) of the Lease), Sections 5,
12 and 16 (but only in order to increase the Lessee's liabilities or change
the Lessor's rights under such Sections in a manner that either enhances
the Lessor's rights or does not otherwise adversely affect the rights of
the Lessor or of the Holders), Sections 7, 8, 10, 18 and 19 (but only that
additional requirements may be imposed under such Sections on the Lessee),
Section 9 (but only that further restrictions may be imposed on the
Lessee), Section 11 (but only (i) with respect to insurance maintained by
Lessor or Owner Participant and (ii) that additional insurance requirements
may be imposed on the Lessee), Section 13 (but only in the case of an
assignment by the Lessor in circumstances where the Aircraft shall remain
registrable under the Act), Section 14 (but only to impose additional or
more stringent Lease Events of Default), Section 15 (but only to impose
additional remedies) and any definition of terms used in the Lease (whether
appearing in Section 1 or elsewhere in the Lease), but only to the extent
that any modification of such definition is required by or would result in
a modification of the Lease permitted pursuant to this subsection (b).
The Indenture Trustee may, without the consent of any Holder, give any
consent, waiver, authorization or approval under any Indenture Document, whether
or not provided for therein, if, as reflected in an Opinion of Counsel referred
to in Section 13.07(d), such consent, waiver, authorization or approval does not
adversely affect the interests of Holders.
The consent of the Indenture Trustee shall not be required for any
amendment or supplement to the Lease necessary to adjust the percentages for
Basic Rent, Stipulated Loss Value, Termination
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Value or EBO Percentage pursuant to Section 3(c) of the Lease (as long as such
amounts as adjusted comply with Section 3(c) of the Lease).
(c) No modification, amendment, supplement, consent, waiver,
authorization or approval with respect to the Lease, whether effected pursuant
to subsection (a) or pursuant to subsection (b) of this Section 13.07 and
anything in such subsections or elsewhere in this Indenture to the contrary
notwithstanding, shall, without the consent of the Holder of each Outstanding
Certificate directly or indirectly affected thereby, reduce the amount of, or
change the timing of payment of, any payment of Basic Rent, Supplemental Rent,
Stipulated Loss Value, Termination Value or the EBO Percentage, as the case may
be, below the amount required to pay as and when due (i) all principal, premium
(if any) and interest payable on the Certificates and (ii) any other amounts
required to be paid pursuant thereto or hereto, at any time or from time to
time.
(d) Upon receipt of an Officers' Certificate and an Opinion of
Counsel (which Opinion, in the case of the Lessee, shall be by counsel other
than an employee of the Lessee unless the related modification, amendment,
addition or deletion effects a change that relates solely to the period after
there are no longer any Certificates Outstanding) from the Lessee or the Owner
Trustee, the Indenture Trustee shall consent and evidence its consent to any
action permitted by this Section 13.07 and the Indenture Trustee shall be fully
protected in relying on such Officers' Certificate and Opinion of Counsel.
ARTICLE XIV
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 14.01. Satisfaction and Discharge of Indenture; Termination of
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Indenture. If at any time after (a) the Owner Trustee shall have paid or caused
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to be paid the principal of and interest and premium, if any, on all the
Certificates outstanding hereunder, as and when the same shall have become due
and payable, or (b) the Owner Trustee shall have delivered to the Indenture
Trustee for cancellation all Certificates theretofore authenticated (other than
any Certificates which shall have been destroyed, lost or stolen and which shall
have been replaced or paid as provided in Section 2.07) or (c) (i) all such
Certificates not theretofore delivered to the Indenture Trustee for cancellation
shall have become due and payable, or are by their terms to become due and
payable within one year or are to be called for redemption within one year under
arrangements satisfactory to the Indenture Trustee for the giving of notice of
redemption by the Indenture Trustee in the name and at the expense of the Owner
Trustee, and (ii) the Owner Trustee shall have irrevocably deposited or caused
to be deposited with the Indenture
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Trustee as trust funds the entire amount in cash (other than moneys repaid by
the Indenture Trustee or any paying agent to the Owner Trustee in accordance
with Section 14.04) or Government Obligations maturing as to principal, premium,
if any, and interest in such amounts and at such times as will insure the
availability of cash sufficient to pay at maturity all such Certificates not
theretofore delivered to the Indenture Trustee for cancellation, including
principal, premium, if any, and interest due or to become due to such date of
maturity as the case may be, and if, in any such case, the Owner Trustee shall
also pay or cause to be paid all other sums then payable hereunder by the Owner
Trustee, then this Indenture shall cease to be of further effect (except as to
(i) rights of registration of transfer and exchange, and the Owner Trustee's
right of optional redemption pursuant to Section 6.02(B), (ii) substitution of
mutilated, defaced, destroyed, lost or stolen Certificates, (iii) rights of
Holders to receive payments of principal thereof and interest thereon, upon the
original stated due dates therefor (but not upon acceleration), (iv) the rights,
obligations, indemnities and immunities of the Indenture Trustee hereunder and
(v) the rights of the Holders as beneficiaries hereof with respect to the
property so deposited with the Indenture Trustee payable to all or any of them),
and the Indenture Trustee, on demand of the Owner Trustee accompanied by an
Officers' Certificate and an Opinion of Counsel and at the cost and expense of
the Owner Trustee, shall execute proper instruments acknowledging such
satisfaction of and discharging this Indenture. The Owner Trustee agrees to
reimburse and indemnify the Indenture Trustee for any costs or expenses
thereafter reasonably and properly incurred and to compensate the Indenture
Trustee for any services thereafter reasonably and properly rendered by the
Indenture Trustee in connection with this Indenture or the Certificates.
Upon (or at any time after) payment in full to the Indenture Trustee, as
trust funds, of the principal of and interest on and premium, if any, and all
other amounts due under all Certificates and provided that there shall then be
--------
no other amounts due to the Holders and the Indenture Trustee hereunder or under
the Participation Agreement or otherwise secured hereby, the Owner Trustee shall
direct the Indenture Trustee to execute and deliver to or as directed in writing
by the Owner Trustee an appropriate instrument releasing the Aircraft from the
Lien of this Indenture and releasing the Indenture Documents from the assignment
thereof hereunder, and the Indenture Trustee shall execute and deliver such
instrument as aforesaid and, at the Owner Trustee's expense, will execute and
deliver such other instruments or documents as may be reasonably requested by
the Owner Trustee to give effect to such release; provided, however, that this
-----------------
Indenture and the trusts created hereby shall terminate earlier and this
Indenture shall be of no further force or effect upon any sale or other final
disposition by the Indenture Trustee of all property forming a part of the
Indenture Estate and the final distribution by the Indenture Trustee of all
moneys or other property or proceeds constituting part of the Indenture Estate
in accordance with the
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terms hereof. Except as aforesaid otherwise provided, this Indenture and the
trusts created hereby shall continue in full force and effect in accordance with
the terms hereof.
SECTION 14.02. Application by Indenture Trustee of Funds Deposited for
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Payment of Certificates. Subject to Section 14.04, all moneys deposited with
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the Indenture Trustee pursuant to Section 14.01 shall be held in trust and
applied by it to the prompt payment, either directly or through any paying agent
(including the Indenture Trustee acting as its own paying agent), to the Holders
of the particular Certificates for the payment or redemption of which such
moneys have been deposited with the Indenture Trustee, of all sums due and to
become due thereon for principal, interest and premium; but such money need not
be segregated from other funds except to the extent required by law.
SECTION 14.03. Repayment of Moneys Held by Paying Agent. Upon the
----------------------------------------
satisfaction and discharge of this Indenture all moneys then held by any Paying
Agent under the provisions of this Indenture, other than funds deposited under
Section 14.01(c)(ii) hereof to the extent not distributed to the Holders, shall,
upon demand of the Owner Trustee, be repaid to it or paid to the Indenture
Trustee and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
SECTION 14.04. Transfer of Moneys Held by Indenture Trustee and Paying
-------------------------------------------------------
Agent Unclaimed for Two Years and Eleven Months. Any moneys deposited with or
- -----------------------------------------------
paid to the Indenture Trustee or any Paying Agent for the payment of the
principal of or interest or premium on any Certificate and not applied but
remaining unclaimed for two years and eleven months after the date upon which
such principal, interest or premium shall have become due and payable, shall,
unless otherwise required by mandatory provisions of applicable escheat or
abandoned or unclaimed property law, be paid to the Owner Trustee by the
Indenture Trustee or such Paying Agent and the Holder of such Certificate, as a
general unsecured creditor, shall, unless otherwise required by mandatory
provisions of applicable escheat or abandoned or unclaimed property laws,
thereafter look only to the Owner Trustee for any payment which such Holder may
be entitled to collect, and all liability of the Indenture Trustee, or any
Paying Agent with respect to such moneys shall thereupon cease.
ARTICLE XV
MISCELLANEOUS
SECTION 15.01. Capacity in Which Acting. Each of Trust
------------------------
Company (or its permitted successors or assigns) and the Indenture Trustee acts
hereunder not in its individual capacity but solely as trustee except as
expressly provided herein and in the other Operative Documents, and, in the case
of Trust Company (or its permitted successors or assigns), in the Trust
Agreement.
- 78 -
SECTION 15.02. No Legal Title to Indenture Estate in Holders. No Holder
---------------------------------------------
shall have legal title to any part of the Indenture Estate. No transfer, by
operation of law or otherwise, of any Certificate or other right, title and
interest of any Holder in and to the Indenture Estate or hereunder shall operate
to terminate this Indenture or entitle such Holder or any successor or
transferee of such Holder to an accounting or to the transfer to it of legal
title to any part of the Indenture Estate.
SECTION 15.03. Sale of Indenture Estate by Indenture Trustee is Binding.
--------------------------------------------------------
Any sale or other conveyance of all or any part of the Indenture Estate by the
Indenture Trustee made pursuant to the terms of this Indenture or of the Lease
shall bind the Lessee, the Owner Trustee, the Holders and the Owner Participant
and shall be effective to transfer or convey all right, title and interest of
the Indenture Trustee, the Owner Trustee, the Owner Participant and such Holders
therein and thereto. No purchaser or other grantee shall be required to inquire
as to the authorization, necessity, expediency or regularity of such sale or
conveyance or as to the application of any sale or other proceeds with respect
thereto by the Indenture Trustee.
SECTION 15.04. Indenture for Benefit of Owner Trustee, Indenture Trustee,
---------------------------------------------------------
Owner Participant and Holders. Nothing in this Indenture, whether express or
- -----------------------------
implied, shall be construed to give to any person other than the Trust Company,
the Owner Trustee, the Lessee, the Indenture Trustee, as trustee and in its
individual capacity, the Owner Participant, and the Holders any legal or
equitable right, remedy or claim under or in respect of this Indenture.
SECTION 15.05. No Action Contrary to the Lessee's Rights Under the Lease.
---------------------------------------------------------
Notwithstanding any of the provisions of this Indenture or the Trust Agreement
to the contrary, so long as no Lease Event of Default shall have occurred and be
continuing, neither the Indenture Trustee nor the Owner Trustee will take any
affirmative acts contrary to the terms of the Lease that interfere with the
peaceful and quiet possession and enjoyment of the Aircraft by the Lessee.
SECTION 15.06. Notices. Unless otherwise expressly specified or permitted
-------
by the terms hereof, all notices, requests, demands, authorizations, directions,
consents, waivers or documents provided or permitted by this Indenture to be
made, given, furnished or filed shall be in writing, sent by express delivery
service, postage prepaid, or by confirmed telex or telecopy, and (i) if to the
Owner Trustee, addressed to it at its office at Rodney Square North, 1100 North
Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust
Administration (telecopier (302) 651-8882) (with a copy to the Owner Participant
at the address provided for notice pursuant to Section 15(b) of the
Participation Agreement), (ii) if to the Indenture Trustee, addressed to it at
its office at 101 Barclay Street, New York, New York 10286, Attention: Corporate
Trust -
- 79 -
Corporate Finance Group (telecopier (212) 815-5915), with a copy to it c/o BNY
Business Center Inc., 100 Ashford Center North, Suite 520, Atlanta, Georgia
30338, Attention: Corporate Trust Lease Administration (telecopier (707) 698-
5195), (iii) if to the Owner Participant or the Lessee, addressed to such party
at such address as such party shall have furnished by notice to the Owner
Trustee and the Indenture Trustee, or, until an address is so furnished,
addressed to the address of such party (if any) set forth on Annex II of the
Participation Agreement or (iv) if to the Pass Through Trustee, to the address
set forth on Annex II of the Participation Agreement with a copy to the
Indenture Trustee at the address set out in clause (ii) above. Any party hereto
may change the address to which notices to such party will be sent by giving
notice of such change to the other parties to this Indenture.
Where this Indenture provides for notice to Holders, such notice shall be
sufficiently given (unless otherwise expressly provided herein) if in writing
and mailed, first-class postage prepaid, to each Holder entitled thereto, at his
last address as it appears in the Register. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Indenture Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular
express delivery service, it shall be impracticable to send notice to the Owner
Trustee by express delivery service and Holders when such notice is required to
be given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed to
be a sufficient giving of such notice.
SECTION 15.07. Officers' Certificates and Opinions of Counsel; Statements
----------------------------------------------------------
to Be Contained Therein. Upon any application or demand by the Lessee or the
- -----------------------
Owner Trustee to the Indenture Trustee to take any action under any of the
provisions of this Indenture, the Lessee or the Owner Trustee, as the case may
be, shall furnish to the Indenture Trustee upon request (i) an Officers'
Certificate stating that all conditions precedent provided for in this Indenture
relating to the proposed action have been complied with and that the proposed
action is in conformity with the requirements of this Indenture, 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 demand as to which the furnishing of such documents
is specifically required by any
- 80 -
provision of this Indenture relating to such particular application or demand,
no additional certificate or opinion need be furnished.
Any certificate, statement or opinion of an officer of the Owner Trustee
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of or representations by counsel, unless such officer knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of counsel may be based, insofar as it
relates to factual matters information with respect to which is in the
possession of the Lessee or the Owner Trustee, upon the certificate, statement
or opinion of or representations by an officer or officers of the Lessee or the
Owner Trustee, as the case may be, unless such counsel knows that the
certificate, statement or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous.
Any certificate, statement or opinion of an officer of the Lessee or the
Owner Trustee or of counsel thereto may be based, insofar as it relates to
accounting matters, upon a certificate or opinion of or representations by an
accountant or firm of accountants employed by the Lessee or the Owner Trustee,
as the case may be, unless such officer or counsel, as the case may be, knows
that the certificate or opinion or representations with respect to the
accounting matters upon which his certificate, statement or opinion may be based
as aforesaid are erroneous, or in the exercise of reasonable care should know
that the same are erroneous.
Any certificate or opinion of any independent firm of public accountants
filed with the Indenture Trustee shall contain a statement that such firm is
independent.
SECTION 15.08. Severability. Any provision of this Indenture which is
------------
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 15.09. No Oral Modifications or Continuing Waivers. No terms or
-------------------------------------------
provisions of this Indenture or the Certificates may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party or other person against whom enforcement of the change, waiver,
discharge or termination is sought; and any waiver of the terms
- 81 -
hereof or of any Certificate shall be effective only in the specific instance
and for the specific purpose given.
SECTION 15.10. Successors and Assigns. All covenants and agreements
----------------------
contained herein shall be binding upon, and inure to the benefit of, each of the
parties hereto and the successors and assigns of each, all as herein provided.
Any request, notice, direction, consent, waiver or other instrument or action by
any Holder shall bind the successors and assigns of such Holder. This Indenture
and the Indenture Estate shall not be affected by any amendment or supplement to
the Trust Agreement or by any other action taken under or in respect of the
Trust Agreement, except that each reference in this Indenture to the Trust
Agreement shall mean the Trust Agreement as amended and supplemented from time
to time to the extent permitted hereby and thereby.
SECTION 15.11. Headings. The headings of the various Articles and
--------
Sections herein and in the table of contents hereto are for the convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.
SECTION 15.12. Normal Commercial Relations. Anything contained in this
---------------------------
Indenture to the contrary notwithstanding, the Owner Participant, the Trust
Company, the Indenture Trustee and any Holder, or any bank or other affiliate of
any such party, may conduct any banking or other financial transactions, and
have banking or other commercial relationships, with the Lessee fully to the
same extent as if this Indenture were not in effect, including without
limitation the making of loans or other extensions of credit to the Lessee for
any purpose whatsoever, whether related to any of the transactions contemplated
hereby or otherwise.
SECTION 15.13. Governing Law; Counterpart Form. THIS INDENTURE AND EACH
-------------------------------
CERTIFICATE SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW
PROVISIONS THEREOF. This Indenture may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.
- 82 -
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written, and acknowledge that this Indenture has been
made and delivered in the city of New York, and this Indenture having become
effective only upon such execution and delivery.
WILMINGTON TRUST COMPANY, not in its
individual capacity, except as
otherwise expressly provided herein,
but solely as Owner Trustee
By:_____________________________
Title:
THE BANK OF NEW YORK, not in its
individual capacity, except as
otherwise expressly provided herein,
but solely as Indenture Trustee
By:_________________________
Title:
- 83 -
Exhibit A to Trust
Indenture and Security
Agreement (Delta 1994-1)
[Intentionally Left Blank]
A-1
Exhibit B to Trust
Indenture and Security
Agreement (Delta 1994-1)
[Form of Face of Certificate]
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD
OR OFFERED FOR SALE IN CONTRAVENTION OF SAID ACT
No.________ $___________________
EQUIPMENT TRUST CERTIFICATE (DELTA 1994-1)
WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as
OWNER TRUSTEE UNDER TRUST AGREEMENT
(DELTA 1994-1)
DATED AS OF APRIL 1, 1994,
AS AMENDED AND RESTATED AS OF MARCH 1, 1996
Interest Rate Maturity
- ------------- --------
Wilmington Trust Company, not in its individual capacity but solely as
Owner Trustee (herein in such capacity called the "Owner Trustee") under that
certain Trust Agreement (Delta 1994-1) dated as of April 1, 1994, as amended and
restated as of March 1, 1996, between the Owner Participant named therein and
Wilmington Trust Company (herein as such Trust Agreement may be amended or
supplemented from time to time called the "Trust Agreement"), hereby promises to
pay to ______________ or registered assigns, the principal sum of __________
Dollars, payable as set forth on the reverse hereof for the Maturity specified
above, in such coin or currency of the United States of America as at the time
of payment shall be legal tender for the payment of public and private debts,
and to pay interest on the principal outstanding
B-1
from time to time, semiannually on each __________ and ____________, on said
principal sum in like coin or currency at the rate per annum set forth above
from the ________ or the ____________ as the case may be, next preceding the
date of this Certificate to which interest on the Certificates has been paid or
duly provided for, unless the date hereof is a date to which interest on the
Certificates has been paid or duly provided for, in which case from the date of
this Certificate. Notwithstanding the foregoing, if the date hereof is after any
__________ or ____________ and before the following __________ or __________, as
the case may be, this Certificate shall bear interest from such ________ or
___________; provided that, if the Owner Trustee shall default in the payment of
--------
interest due on such or ___________, then this Certificate shall bear interest
from the next preceding __________ or to which interest on the Certificate has
been paid or duly provided for. The interest so payable on any ___________ or
_________ will, except as otherwise provided in the Indenture referred to on the
reverse hereof, be paid to the person in whose name this Certificate is
registered at the close of business on the _________ or ___________ preceding
such or __________ whether or not such day is a Business Day.
Principal and interest and other amounts due hereunder shall be payable at
the office or agency of The Bank of New York (the "Indenture Trustee"), for such
purpose; provided that, at the option of the Indenture Trustee, interest may be
--------
paid by mailing a check therefor payable to the registered holder entitled
thereto at his last address as it appears on the Register. If any amount payable
under this Certificate, or under the Indenture, falls due on a day that is not a
Business Day, then such sum shall be payable on the next succeeding Business
Day, without additional interest thereon for the period of such extension.
NO EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR INDIVIDUAL RETIREMENT
ACCOUNT OR EMPLOYEE BENEFIT PLAN SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (HEREINAFTER COLLECTIVELY REFERRED TO AS AN "ERISA
PLAN"), MAY ACQUIRE OR HOLD ANY OF THE CERTIFICATES. THE ACQUIRING BY ANY PERSON
OF ANY CERTIFICATE SHALL BE DEEMED TO CONSTITUTE A REPRESENTATION BY SUCH PERSON
TO DELTA AIR LINES, INC. AS THE LESSEE, THE OWNER PARTICIPANT, THE OWNER TRUSTEE
AND THE INDENTURE TRUSTEE OR THEIR RESPECTIVE SUCCESSORS, AS THE CASE MAY BE,
THAT SUCH PERSON IS NOT AN ERISA PLAN AND THAT SUCH PERSON IS NOT ACQUIRING, AND
HAS NOT ACQUIRED, SUCH CERTIFICATE WITH ASSETS OF AN ERISA PLAN.
Wilmington Trust Company and The Bank of New York, are not acting
individually hereunder, but solely as Owner Trustee and Indenture Trustee,
respectively.
Reference is made to the further provisions set forth on the reverse
hereof. Such provisions shall for all purposes have the same effect as though
fully set forth at this place.
B-2
This Certificate shall not be secured by or be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose unless
authenticated by the Indenture Trustee as evidenced by the manual signature of
one of its authorized officers on the certificate below.
IN WITNESS WHEREOF, the Owner Trustee has caused this
Equipment Trust Certificate (Delta 1994-1) to be duly executed in its corporate
name by its officer thereunto duly authorized.
Dated:
WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Owner Trustee
By:___________________________
Authorized Officer
B-3
[FORM OF INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Equipment Trust Certificates (Delta
1994-1) referred to in the within-mentioned Indenture.
Dated:
THE BANK OF NEW YORK, not in its
individual capacity but solely as
Indenture Trustee
By:___________________________
Authorized Signatory
B-4
[Form of Reverse of Certificate]
This Certificate is one of a duly authorized issue of Certificates issued
and to be issued under the Trust Indenture and Security Agreement (Delta 1994-1)
dated as of April 1, 1994, as amended and restated as of March 1, 1996 (herein
as amended, supplemented or modified from time to time called the "Indenture";
terms defined in the Indenture are used herein with the same meanings) between
the Owner Trustee and the Indenture Trustee, designated as Equipment Trust
Certificates (Delta 1994-1) limited in aggregate outstanding principal amount to
consisting of the following aggregate principal amounts of Certificates with the
interest rates per annum and maturities shown:
Principal
Maturity Amount Interest Rate
- -------- --------- -------------
Reference is made to the Indenture and all supplements and amendments
thereto (a copy of which is on file with the Indenture Trustee at its principal
corporate trust office) for a more complete statement of the terms and
provisions thereof, including a statement of the properties conveyed, pledged
and assigned thereby, the nature and extent of the security, the respective
rights of the Owner Trustee, the Lessee, the Indenture Trustee and the Holders,
and the terms upon which the Certificates are, and are to be, executed and
delivered, to all of which terms and conditions in the Indenture each Holder
hereof agrees by its acceptance of this Certificate.
The principal amount of the Certificates is payable as follows. The
Certificates with a Maturity of _____________ are subject to redemption in part,
pro rata, commencing on ____________ and the Certificates with a Maturity of
___________________ are subject to redemption in part, pro rata, commencing on
______________ in each case through mandatory sinking fund redemptions providing
for the redemption on the sinking fund redemption dates of the aggregate
principal amounts set forth below, together with interest accrued thereon to the
applicable sinking fund redemption date, but without premium. The mandatory
sinking fund redemptions will retire, as of the respective Maturities, the full
principal amount of the Certificates subject to mandatory redemption.
B-5
Principal Amount
Sinking Fund Certificates Certificates
Redemption Date with a Maturity of with a Maturity of
- --------------- ------------------ ------------------
_____________ _____________
Total _____________ _____________
All payments of principal, premium (if any) and interest and other amounts
to be made to the Holder hereof by or at the behest of the Owner Trustee
hereunder or under the Indenture shall be made only from the income and proceeds
from the Trust Estate to the extent included in the Indenture Estate and only to
the extent that the Owner Trustee shall have sufficient income or proceeds from
the Trust Estate to the extent included in the Indenture Estate to enable the
Indenture Trustee to make such distributions in accordance with the terms of the
Indenture; provided that under the Lease, the Lessee is obligated to pay or
--------
cause to be paid, to the extent such payments are not required to be made from
the assets subject to the Lien of this Indenture or the income and proceeds
received by the Indenture Trustee therefrom, any net loss arising from the
investment of funds held by the Indenture Trustee which but for a Payment
Default or Lease Event of Default would be payable to Lessee, and each Holder
hereof, by its acceptance of this Certificate, agrees that it will look solely
to the income and proceeds from the Indenture Estate to the extent available for
distribution to the Holder hereof as provided above and that none of the Owner
Participant, Wilmington Trust Company or the Indenture Trustee is personally
liable to the Holder hereof for any amounts payable or any liability under this
Certificate or under the Indenture, except as expressly provided in the
Indenture (in the case of Wilmington Trust Company, the Owner Trustee and the
Indenture Trustee) or as expressly provided in the Participation Agreement (in
the case of the Owner Participant).
The Certificates are subject to redemption or purchase in the following
circumstances at the price determined as set forth below:
(A) if an Event of Loss occurs with respect to the Aircraft (unless
pursuant to Section 10 of the Lease and Section 9.08 of the Indenture a
Replacement Airframe (together, if applicable, with a Replacement Engine or
Engines) is substituted therefor), other than an Event of Loss deemed to
have occurred pursuant to the last paragraph of Section 6(b) of the
Participation Agreement, at a price equal to the aggregate unpaid principal
amount of such Certificates together with accrued and unpaid interest
thereon to but excluding the Redemption Date, but without premium;
B-6
(B) if the Owner Trustee, at the direction of the Lessee, gives
notice of redemption to the Indenture Trustee at any time after the date
hereof, or if an Event of Loss with respect to the Aircraft is deemed to
have occurred pursuant to the last paragraph of Section 6(b) of the
Participation Agreement, at a price equal to the Redemption Amount plus all
accrued and unpaid interest on such Certificates to but excluding the
Redemption Date;
(C) if the Owner Trustee, at the direction of the Owner Participant,
at any time gives notice of redemption or purchase to the Indenture Trustee
pursuant to Section 8.02(a) of the Indenture, at a price equal to the
aggregate unpaid principal amount of such Certificates together with
accrued and unpaid interest thereon to but excluding the Redemption Date,
but without premium (except any premium due pursuant to Section 8.02(a)(i)
of the Indenture);
(D) upon any termination of the Lease as provided in Section 9(a) of
the Lease, at a price equal to the Redemption Amount plus all accrued and
unpaid interest on such Certificates to but excluding the Redemption Date;
or
(E) upon the Lessee's exercise of its option to purchase the Aircraft
as provided in Section 16(b)(i) of the Participation Agreement or in
Section 5(b) of the Lease, at a price equal to the Redemption Amount
together with accrued and unpaid interest thereon to but excluding the
Redemption Date.
The Indenture Trustee shall give prompt notice of any such redemption
or purchase by first-class mail to Holders (which notice may be revoked by the
Owner Trustee at any time on or before the Redemption Date except (i) in the
case of a redemption or purchase contemplated by Section 6.02(C) or Section
6.02(E) of the Indenture or (ii) any redemption contemplated by Section 6.02(D)
of the Indenture unless the notice of termination of the Lease pursuant to
Section 9(a) thereof has been revoked), stating the Redemption Date, the basis
for determining the Redemption Price and the place or places where the
Certificates may be surrendered. The Redemption Price of each Certificate shall
be equal to the outstanding principal amount of such Certificate together with
interest accrued thereon to the Redemption Date; plus, solely with regard to a
redemption under subparagraphs (B), (C) (with respect to Section 8.02(a)(i) of
the Indenture) or (D) above, a premium, if any, calculated by an Independent
Investment Banker, equal to the amount necessary to preserve the pretax coupon
yield to maturity of this Certificate if the principal amount of this
Certificate were reinvested in U.S. Treasury securities corresponding in
maturity to the remaining weighted average life of this Certificate.
B-7
If an Indenture Event of Default under the Indenture shall occur and be
continuing, the principal of the Certificates may be declared due and payable in
the manner and with the effect provided in the Indenture. The Indenture provides
that in certain events such declaration and its consequences may be waived by
the Holders of at least 50% in aggregate principal amount of Outstanding
Certificates. Any such consent or waiver by the Holder of this Certificate shall
be conclusive and binding upon such Holder and upon all future Holders and
owners of this Certificate and any Certificate that may be issued in exchange or
substitution therefor, whether or not any notation thereof is made upon this
Certificate or such other Certificates. Moreover, if, and only if, a Lease Event
of Default shall occur, the Indenture Trustee may declare the Lease to be in
default, and may, to the exclusion of the Owner Trustee, exercise one or more of
the remedies of the Owner Trustee provided in the Lease.
The Owner Trustee or the Owner Participant may cure a default by the Lessee
under the Lease arising from the failure of the Lessee to make any Basic Rent
payments under the Lease if such failure of the Lessee to make such payment of
Basic Rent shall not constitute the fourth consecutive such failure or the
seventh or subsequent cumulative such failure. The Owner Trustee or the Owner
Participant may cure any other default by the Lessee in the performance of its
obligations under the Lease which can be cured by the payment of money by making
such payment on behalf of the Lessee.
At any time while the Certificates have become immediately due and payable
as provided in the Indenture, the Owner Participant may direct the Owner Trustee
to pay to the Indenture Trustee for distribution to the Holders an amount equal
to the aggregate unpaid principal amount of all Outstanding Certificates plus
all accrued but unpaid interest thereon to the date of payment and all other
amounts due hereunder, but without premium. Upon such payment, the Certificates
shall cease to accrue interest thereafter.
By acceptance of this Certificate, the Holder hereof waives to the fullest
extent permitted by law the benefit of the provisions of Section 1111(b) of the
Bankruptcy Code with respect to recourse against the Trust Company and the Owner
Participant on account of any amount payable as principal, premium, interest or
other amounts pursuant to this Certificate.
The right of the Holder hereof to institute action for any remedy under the
Indenture is subject to certain restrictions specified in the Indenture, except
that the right of the Holder of this Certificate to receive payment of the
principal of and interest on this Certificate on or after the respective due
dates, or to institute suit for the enforcement of any such payment, shall not
be impaired or affected without the consent of such Holder.
B-8
The Certificates are issuable only as registered Certificates without
coupons in denominations of $1,000 and integral multiples thereof. So long as
any of the Certificates remain Outstanding, the Indenture Trustee will maintain
(i) an office or agency in Atlanta, Georgia where the Certificates may be
presented for payment and (ii) a facility or agency in New York, New York where
the Certificates may be presented for registration of transfer and for exchange
as provided in the Indenture. As provided in the Indenture and subject to
certain limitations therein, this Certificate is transferable, and upon
surrender of this Certificate for registration of transfer at the principal
corporate trust office of the Indenture Trustee, or at the office or agency
maintained for such purposes, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Owner Trustee and the
Indenture Trustee duly executed by, the Holder or his attorney duly authorized
in writing, one or more new Certificates of the same Maturity and interest rate
and of authorized denominations and for the same aggregate principal amount will
be issued to the designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein,
the Certificates are exchangeable for an equal aggregate principal amount of
Certificates of the same Maturity and interest rate and of authorized
denominations, as requested by the Holder surrendering the same, upon
presentation thereof for such purpose at the principal corporate trust office of
the Indenture Trustee, or at an office or agency maintained for such purpose.
No service charge to the Holder shall be made for any such registration of
transfer or exchange, but the Owner Trustee or the Indenture Trustee may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to the due presentment for registration of transfer of this
Certificate, the Owner Trustee, the Indenture Trustee, any agent of the Owner
Trustee or the Indenture Trustee, the Paying Agent, if any, the Registrar and
the Lessee may deem and treat the person in whose name this Certificate is
registered as the absolute owner hereof for all purposes whether or not this
Certificate is overdue, and neither the Owner Trustee, the Indenture Trustee
(nor any agent of the Owner Trustee or the Indenture Trustee), nor the Paying
Agent, if any, the Registrar nor the Lessee shall be affected by notice to the
contrary.
As provided in the Indenture, the Indenture and the Certificates shall be
construed in accordance with and governed by the laws of the State of New York,
without giving effect to the conflicts of laws provisions thereof.
B-9