EXHIBIT 4.f
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TRUST AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N582FE)
Dated as of April 1, 1996
Amended and Restated as of June 1, 1996
between
BOATMEN'S EQUIPMENT FINANCE, INC.,
Trustor
and
FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION,
Owner Trustee
COVERING ONE MCDONNELL DOUGLAS MD-11F AIRCRAFT
SERIAL NO. 48420, REGISTRATION NO. N1751A
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TABLE OF CONTENTS
PARTIES................................................................. 1
RECITALS................................................................. 1
ARTICLE 1
THE LESSOR'S ESTATE
Section 1.01. Authorization and Direction to Owner Trustee........... 1
Section 1.02. Declaration of Trust................................... 2
Section 1.03. Conditions Precedent................................... 2
ARTICLE 2
DISTRIBUTIONS
Section 2.01. Rent, Etc.............................................. 2
Section 2.02. Excepted Payments...................................... 3
Section 2.03. Other Receipts......................................... 3
Section 2.04. Distributions after Default............................ 4
Section 2.05. Distributions after Release of Lien of Indenture....... 4
Section 2.06. Manner of Making Distributions......................... 4
ARTICLE 3
THE OWNER TRUSTEE
Section 3.01. Acceptance of Trust and Duties......................... 5
Section 3.02. Limitation on Authority of Owner Trustee............... 6
Section 3.03. Notice of Default...................................... 6
Section 3.04. Action Upon Instructions............................... 7
Section 3.05. Certain Duties and Responsibilities of Owner Trustee... 7
Section 3.06. Certain Rights of Owner Trustee........................ 9
Section 3.07. No Representations or Warranties
as to Certain Matters............................... 11
Section 3.08. Status of Moneys Received............................. 12
Section 3.09. Self-Dealing.......................................... 12
Section 3.10. Definition of a Responsible Officer................... 12
Section 3.11. Resignation or Removal of Owner Trustee............... 12
Section 3.12. Estate and Rights of Successor Owner Trustee.......... 13
Section 3.13. Merger or Consolidation of FSBU....................... 13
Section 3.14. Co-Trustees........................................... 14
Section 3.15. Interpretation of Agreements.......................... 15
Section 3.16. Not Acting in Individual Capacity..................... 15
Section 3.17. Tax Returns........................................... 15
ARTICLE 4
TERMINATION OF TRUST
Section 4.01. Termination........................................... 16
Section 4.02. Termination at Option of the Trustor.................. 17
Section 4.03. Distribution of Lessor's Estate upon Termination...... 17
ARTICLE 5
TRANSFER OF BENEFICIAL INTEREST
ARTICLE 6
MISCELLANEOUS
Section 6.01. Indemnification....................................... 19
Section 6.02. Supplements and Amendments............................ 20
Section 6.03. Nature of Title of Trustor............................ 21
Section 6.04. Power of Owner Trustee to Convey...................... 21
Section 6.05. Notices............................................... 21
Section 6.06. Situs of Trust; Applicable Law; Severability.......... 22
Section 6.07. Successors and Assigns................................ 22
Section 6.08. Headings and Table of Contents........................ 23
Section 6.09. Definitions........................................... 23
Section 6.10. Identification of Trust............................... 23
Section 6.11. Counterparts.......................................... 23
Section 6.12. Trustor Interest...................................... 23
Schedule I Definitions
TRUST AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N582FE)
TRUST AGREEMENT (FEDERAL EXPRESS CORPORATION TRUST NO. N582FE) dated
as of April 1, 1996, as amended and restated as of June 1, 1996 (this
"Agreement") between FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION, a
national banking association (in its individual capacity, "FSBU", and not in
its individual capacity but solely as trustee hereunder, the "Owner Trustee"),
and BOATMEN'S EQUIPMENT FINANCE, INC., a Missouri corporation (together with
its successors and permitted assigns, the "Trustor");
W I T N E S S E T H :
WHEREAS, the Trustor and FSBU have heretofore entered into the
Original Trust Agreement;
WHEREAS, the Original Trust Agreement was duly filed with the
Federal Aviation Administration on April 22, 1996;
WHEREAS, the Original Loan Participants participated in the
payment of the Purchase Price by providing financing as evidenced by the
Original Loan Certificates;
WHEREAS, pursuant to Article 15 of the Original Participation
Agreement, the Lessee, the Trustor and the Owner Trustee desire to refinance
all of the Original Loan Certificates on the Refunding Date; and
WHEREAS, the Trustor and the Owner Trustee desire, in connection
with such refinancing, to amend and restate the Original Trust Agreement in
its entirety as herein provided.
NOW THEREFORE, in consideration of the mutual covenants and
agreements contained herein, FSBU and the Trustor agree that the Original
Trust Agreement be and the same is hereby amended and restated in its
entirety as follows:
ARTICLE 1
THE LESSOR'S ESTATE
Section 1.01. Authorization and Direction to Owner Trustee. The
Trustor hereby authorizes and directs (or has authorized and directed) the
Owner Trustee, not individually but solely as the Owner Trustee hereunder:
(a) to execute and deliver each of the other Operative Agreements
to which the Owner Trustee is a party and to enter into and perform the
transactions contemplated thereby;
(b) to execute and deliver from time to time the Certificates in
the manner and subject to the terms and conditions provided in the
Participation Agreement and the Indenture;
(c) to execute and deliver each other document referred to in the
Operative Agreements and the Original Agreements to which the Owner
Trustee is a party or which the Owner Trustee is required to deliver
pursuant to the Operative Agreements and the Original Agreements;
(d) subject to the terms of this Agreement, to perform the
obligations and duties and, upon instruction of the Trustor, exercise
the rights of the Owner Trustee under the Operative Agreements; and
(e) to execute and deliver all such other instruments, documents
or certificates and take all such other actions in accordance with the
directions of the Trustor, as the Trustor may deem necessary or
advisable in connection with the transactions contemplated hereby, the
taking of any such action by the Owner Trustee in the presence of the
Trustor or its counsel to evidence, conclusively, the direction of the
Trustor.
Section 1.02. Declaration of Trust. FSBU hereby confirms, in its
individual capacity, that it holds and will continue to hold, in its
capacity as the Owner Trustee, the Lessor's Estate upon the trusts herein
set forth for the use and benefit of the Trustor, subject, however, to the
provisions of, and the Lien created by, the Indenture.
Section 1.03. Conditions Precedent. The right and obligation of
the Owner Trustee to take the actions required by Section 1.01 hereof shall
be subject to the condition that the terms and conditions of Section 4.01
of the Participation Agreement shall have been complied with in a manner
satisfactory to the Owner Trustee and the Trustor.
ARTICLE 2
DISTRIBUTIONS
Section 2.01. Rent, Etc. The Trustor and the Owner Trustee
acknowledge that the Lease will be security for the Certificates pursuant
to the Indenture which provides that all moneys payable by the Lessee to
the Owner Trustee under the Lease (other than Excepted Payments) are to be
paid to the Indenture Trustee while the Lien of the Indenture is in effect.
Except as otherwise provided in Section 2.04 hereof, the Owner Trustee
shall promptly apply each payment of Excess Amount, Rent (other than
Excepted Payments), Stipulated Loss Value, Termination Value, and any
proceeds from the sale, requisition or disposition of the Aircraft received
by it as follows:
(a) prior to the release of the Lien of the Indenture, each such
payment shall be payable directly to the Indenture Trustee (and if any
of the same are received by the Owner Trustee shall, upon receipt, be
paid over to the Indenture Trustee without deduction, set off or
adjustment of any kind) for distribution in accordance with the
provisions of Article V of the Indenture; provided, that any payments
received by the Owner Trustee from (i) the Lessee with respect to FSBU's
or the Owner Trustee's fees and disbursements under this Agreement, or
(ii) the Trustor pursuant to Section 6.01 hereof shall not be paid over
to the Indenture Trustee but shall be retained by the Owner Trustee and
applied toward the purpose for which such payments were made;
(b) any amount remaining after application in full in accordance
with paragraph (a) of this Section 2.01 and which represents payments
for which provision as to the application thereof is made in any other
Operative Agreement shall be applied promptly to the purpose for which
such payment shall have been made in accordance with the terms of such
Operative Agreement; and
(c) after application in accordance with paragraphs (a) and (b) of
this Section 2.01, or to the extent received from the Indenture Trustee
under the terms of the Indenture, the balance, if any, remaining shall be
paid to the Trustor.
Section 2.02. Excepted Payments. All Excepted Payments at any time
received by the Owner Trustee shall be distributed promptly to the applicable
Person, and such payment shall not be deemed under any circumstances to be
part of the Lessor's Estate.
Section 2.03. Other Receipts. Except as otherwise provided in
Section 2.04 hereof, any payment received by the Owner Trustee, other than
those referred to in Sections 2.01 and 2.02 hereof, shall be payable prior
to the release of the Lien of the Indenture directly to the Indenture
Trustee (and if any of the same are received by the Owner Trustee shall,
upon receipt, be paid over to the Indenture Trustee without deduction, set
off or adjustment of any kind) for distribution in accordance with the
provisions of Article V of the Indenture; and following such application or
release of Lien, any such payment for which provision as to the application
thereof is made in the other Operative Agreements shall be applied promptly
to the purpose for which such payment shall have been made in accordance
with the terms of the other Operative Agreements, and any such payment
received by the Owner Trustee for which no provision as to the application
thereof is made in the Operative Agreements or in this Article 2 shall,
unless the Trustor shall have otherwise instructed the Owner Trustee in
writing, be distributed promptly to the Trustor.
Section 2.04. Distributions after Default. Subject to the
provisions of Section 2.02 hereof, (i) all payments received and amounts
realized by the Owner Trustee after an Indenture Event of Default shall
have occurred and shall be continuing and after the Certificates shall have
become or been declared due and payable pursuant to Section 7.02(b) or
7.02(c) of the Indenture or the Lease shall have become or been declared in
default (including, without limitation, any amounts realized by the Owner
Trustee or the Trustor from the exercise of any remedies pursuant to
Section 17.01 of the Lease), as well as (ii) all funds then held or
thereafter received by the Owner Trustee as part of this Trust Agreement,
the Lease or otherwise, shall be distributed to the Indenture Trustee.
Section 2.05. Distributions after Release of Lien of Indenture.
Except as otherwise provided in Sections 2.01, 2.02, 2.03 and 2.04 hereof:
(a) all payments received and amounts realized by the Owner
Trustee under the Lease or otherwise with respect to the Aircraft or
any part thereof (including, without limitation, all payments
received pursuant to Section 17.01 of the Lease and amounts realized
upon the sale or lease of the Aircraft or any part thereof after the
termination of the Lease with respect thereto), to the extent
received or realized at any time after the Lien of the Indenture
shall have been released pursuant to the terms of the Indenture, and
(b) moneys not included in paragraph (a) of this Section 2.05
remaining as part of the Lessor's Estate after the Lien of the
Indenture has been released,
shall, to the extent required, be retained by the Owner Trustee as
reimbursement for all expenses hereunder or under the Lease not theretofore
reimbursed under this Agreement, the Lease or otherwise and to which the
Owner Trustee is entitled to be reimbursed pursuant to the provisions
thereof, and any balance remaining thereafter shall be distributed to the
Trustor.
Section 2.06. Manner of Making Distributions. The Owner Trustee
shall make distributions or cause distributions to be made to (i) the
Trustor pursuant to this Article 2 by transferring by wire transfer in
immediately available funds the amount to be distributed to such account or
accounts of the Trustor as it may designate from time to time by written
notice to the Owner Trustee (and the Owner Trustee shall use best efforts
to cause such funds to be transferred by wire transfer on the same day as
received, but in any case not later than the next succeeding Business Day),
and (ii) the Indenture Trustee pursuant to this Article 2 by paying the
amount to be distributed to the Indenture Trustee in the manner specified
in the Indenture; provided, that the Owner Trustee shall invest overnight,
for the benefit of the Trustor, in investments that would be permitted by
Article 23 of the Lease (but only to the extent funds are received on or
prior to 1:00 P.M. (Eastern Time) and such investments are available and,
if such investments are not available to the Owner Trustee, in investments
which, after consultation with the Trustor, the Trustor shall direct) all
funds not transferred by wire transfer on the same day as they were
received. Notwithstanding the foregoing but subject always to the
provisions of, and the Lien created by, the Indenture, the Owner Trustee
will, if so requested by the Trustor by written notice, pay any and all
amounts payable by the Owner Trustee hereunder to the Trustor either (i) by
crediting, or causing the Indenture Trustee to credit, such amount or
amounts to an account or accounts maintained by the Trustor with the Owner
Trustee in its individual capacity or with the Indenture Trustee in its
individual capacity, as the case may be, in immediately available funds, or
(ii) by wire transfer of immediately available funds to such other bank
account as the Trustor shall notify the Owner Trustee in writing with
sufficient information to identify the source and application of such
funds.
ARTICLE 3
THE OWNER TRUSTEE
Section 3.01. Acceptance of Trust and Duties. FSBU accepts the
trust hereby created and, subject to Section 1.03 hereof, in its capacity
as the Owner Trustee agrees to perform the same, including without
limitation, subject to Section 1.03 hereof, the actions specified in
Section 1.01 hereof as herein provided. The Owner Trustee agrees to
disburse all monies that it receives under the Operative Agreements in
accordance with the terms hereof. The Owner Trustee shall not be
answerable or accountable in its individual capacity except as a result of
or arising from (a) the Owner Trustee's willful misconduct or gross
negligence (in its individual capacity or as trustee), (b) any breach by
the Owner Trustee of its representations, warranties and covenants given in
its individual capacity in this Agreement, Article 5 of the Lease, Sections
7.01(c), 7.02(a) and (b) and 7.04 of the Participation Agreement or its
representations, warranties and covenants in Sections 3.05 and 3.08 of the
Indenture, (c) the failure to use ordinary care in receiving, handling and
disbursing funds, (d) Lessor's Liens attributable to it in its individual
capacity, and (e) taxes, fees, or other charges on, based on, or measured
by, any fees, commissions or compensation received by FSBU or the Owner
Trustee in connection with the transactions contemplated by the Lease, the
Indenture and the Operative Agreements including this Agreement.
Section 3.02. Limitation on Authority of Owner Trustee. The
Owner Trustee shall have no power, right, duty or authority to manage,
control, possess, use, sell, lease, dispose of or otherwise deal with the
Aircraft, Airframe, Engines, any Part thereof or any other property at any
time constituting a part of the Lessor's Estate, or otherwise to take or
refrain from taking any action under or in connection with the Operative
Agreements, except (i) to execute and deliver the Operative Agreements to
which it is a party, (ii) to exercise and carry out or cause to be
exercised or carried out the rights, duties and obligations of the Owner
Trustee hereunder and under the other Operative Agreements, or (iii) as
expressly provided in written instructions from the Trustor given pursuant
to Section 1.01, 3.03 or 3.04 hereof; provided, that nothing in this
Section 3.02 shall limit in any manner the obligation of the Owner Trustee
to perform and observe all the terms of the Operative Agreements or the
obligations of the Owner Trustee under this Agreement.
Section 3.03. Notice of Default. In the event that a Responsible
Officer in the Corporate Trust Department of the Owner Trustee shall have
actual knowledge of a Default or an Event of Default, or an Indenture
Default or an Indenture Event of Default, the Owner Trustee shall give or
cause to be given to the Trustor and the Indenture Trustee prompt notice
(in any event, within one Business Day of the discovery thereof) of such
Default, Event of Default, Indenture Default or Indenture Event of Default
by telegram, telex, or facsimile followed by prompt written notice thereof
by first-class certified mail, postage prepaid, return receipt requested in
accordance with Article 14 of the Participation Agreement. Subject to the
terms of Section 3.06(e) hereof and the rights of the Indenture Trustee
under the Indenture, the Owner Trustee shall take such action with respect
to such Default, Event of Default, Indenture Default or Indenture Event of
Default as shall be specified in written instructions from the Trustor, and
if the Owner Trustee shall not have received instructions from the Trustor
within 20 days after giving notice of such Default, Event of Default,
Indenture Default or Indenture Event of Default to the Trustor, the Owner
Trustee may take such action, or refrain from taking such action, with
respect to such Default, Event of Default, Indenture Default or Indenture
Event of Default as it shall deem advisable in the best interests of the
Trustor; provided, that the Owner Trustee shall be under no duty to take or
refrain from taking any such action in the event the Owner Trustee shall
not have received instructions from the Trustor. For all purposes of this
Agreement and the Lease, in the absence of actual knowledge of a
Responsible Officer of the Owner Trustee, the Owner Trustee shall not be
deemed to have knowledge of a Default, Event of Default, Indenture Default
or Indenture Event of Default unless notified in writing by the Lessee, the
Trustor, the Indenture Trustee or any Certificate Holder.
Section 3.04. Action Upon Instructions. Subject in all respects
to the terms of the Operative Agreements, and subject further to the terms
of Article 2 and Sections 3.03, 3.05 and 3.06 hereof, upon the written
instructions at any time and from time to time of the Trustor (which the
Trustor agrees shall not be inconsistent with the provisions of the
Indenture so long as the Lien of the Indenture has not been discharged),
the Owner Trustee will take such of the following actions as may be
specified in such instructions:
(a) give such notice or direction or exercise such right, remedy
or power under the Operative Agreements, or take such other action, as
shall be specified in such instructions;
(b) take such action to preserve or protect the Lessor's Estate
(including the discharge of Liens and encumbrances) as may be specified
in such instructions;
(c) approve as satisfactory to it all matters required by the
terms of the Operative Agreements to be satisfactory to the Owner
Trustee (it being understood that without written instructions of the
Trustor, the Owner Trustee shall not approve any matter as satisfactory
to it), except such approvals as may be required with respect to the
Trustor's transfer of its Beneficial Interest pursuant to Article 5;
(d) upon or after the expiration or earlier termination of the
Term of the Lease, convey in accordance with such instructions, the
Aircraft and all of the Owner Trustee's right, title and interest in and
to the Aircraft or any part thereof for such amount, on such terms and
to such purchaser or purchasers as shall be designated in such
instructions, or retain, lease or otherwise dispose of the Aircraft or
any part thereof as shall be specified in such instructions;
(e) execute and file any financing statement (and any continuation
statement with respect to any such financing statement) or any other
similar document relating to the Lessor's Estate or the security
interests and assignments created by the Operative Agreements, as may be
specified in such instructions (which instructions shall be accompanied
by an execution form of such financing statement or such continuation
statement, as the case may be); and
(f) any other action as specified by the Trustor.
Section 3.05. Certain Duties and Responsibilities of Owner
Trustee. (a)(i) The Owner Trustee undertakes to perform such duties and
only such duties as are specifically set forth herein, and with the degree
of care specified in Section 3.01 hereof, and in accordance with
instructions given by the Trustor hereunder, and no implied duties,
covenants or obligations shall be read into this Agreement, any such
instructions or the Operative Agreements against the Owner Trustee, and the
Owner Trustee agrees that it will not manage, control, possess, use, sell,
lease, dispose of or otherwise deal with the Aircraft or any part of the
Lessor's Estate except as required by the terms of the Operative
Agreements, any such instructions and as otherwise provided herein; and
(ii)in the absence of bad faith on its part, the Owner Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Owner Trustee and conforming to the requirements of
this Agreement or the other Operative Agreements, but in the case of any
such certificates or opinions which by any provisions hereof or thereof
are specifically required to be furnished to the Owner Trustee, the
Owner Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Trust Agreement
or the Operative Agreements.
(b) No provision hereof shall require FSBU in its individual
capacity to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
Notwithstanding the foregoing, FSBU agrees in its individual capacity that
it will, at its own cost and expense, promptly take such action as may be
necessary to discharge duly all Lessor's Liens attributable to it in its
individual capacity and will claim no indemnity therefor hereunder, or
under the Participation Agreement or any Operative Agreement.
(c) Whether or not therein expressly so provided, every provision
of this Agreement relating to the conduct or affecting the liability of or
affording protection to the Owner Trustee shall be subject to the
provisions of this Section 3.05, except that in the event of a conflict
between this Section 3.05 and Section 3.01 hereof, Section 3.01 hereof
shall be controlling.
(d) The Owner Trustee will furnish to the Trustor, promptly upon
receipt thereof, duplicates or copies of all reports, notices, requests,
demands, certificates, financial statements and any other instruments
furnished to the Owner Trustee hereunder or under the other Operative
Agreements or the Original Agreements (including those furnished to the
Indenture Trustee pursuant to the terms of the Indenture) and not otherwise
furnished to the Trustor.
(e) Notwithstanding anything herein to the contrary, the Owner
Trustee shall not be authorized and shall have no power to "vary the
investment" of the Trustor within the meaning of Treasury Regulations Section
301.7701-4(c)(1), it being understood that the Owner Trustee shall have the
power and authority to fulfill its obligations under Section 2.06 hereof and
Article 23 of the Lease.
Section 3.06. Certain Rights of Owner Trustee. Except as otherwise
provided in Section 3.05 hereof:
(a) in the absence of bad faith on its part, the Owner Trustee may
rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order 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 or authorization by the Trustor or any
other party to any other Operative Agreement shall be sufficiently
evidenced by a request, direction or authorization in writing, delivered
to the Owner Trustee, and signed in the name of such party by any of the
Chairman of the Board, the President, any Vice President, the Treasurer
or Assistant Treasurer or the Secretary or Assistant Secretary or other
duly authorized officer of such party; and any resolution of the Board
of Directors or committee thereof of such party shall be sufficiently
evidenced by a copy of such resolution certified by the Secretary or an
Assistant Secretary of such party, to have been duly adopted and to be
in full force and effect on the date of such certification, and
delivered to the Owner Trustee;
(c) whenever in the administration of this Agreement the Owner
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder or under any
of the other Operative Agreements, the Owner Trustee (unless other
evidence be herein or therein specifically prescribed), absent actual
knowledge of a Responsible Officer of the Owner Trustee to the contrary,
may rely in good faith upon a certificate in writing, delivered to the
Owner Trustee and signed by any of the Chairman of the Board, the
President, any Vice President, the Treasurer or Assistant Treasurer or
the Secretary or Assistant Secretary of the Lessee, the Trustor, or the
Indenture Trustee and notice of such need for such proof or
establishment shall be delivered to the Trustor, who may advise the
Owner Trustee in respect of such matter and the Owner Trustee shall act
in conformity with such advice;
(d) the Owner Trustee may exercise its powers and perform its
duties by or through such attorneys, agents and servants as it shall
appoint with due care, and it shall be entitled to rely upon the advice
of counsel reasonably selected by it with due care and shall be
protected by the advice of such counsel in anything done or omitted to
be done in accordance with such advice;
(e) the Owner Trustee shall not be under any obligation to take
any action under this Agreement or under any of the other Operative
Agreements at the request or direction of the Trustor unless the Persons
making such request or direction shall have offered to the Owner Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction; nor shall the Owner Trustee be required to take
any action and this Agreement shall not be deemed to impose on the Owner
Trustee any obligation to take any action, if the Owner Trustee shall
have been advised by its counsel that such action is unlawful or is
contrary to the terms of this Agreement or the other Operative
Agreements;
(f) the Owner Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order or other paper or document unless a Responsible Officer
of the Owner Trustee has actual knowledge that the facts or matters
stated therein are false or inaccurate, but the Owner Trustee in its
discretion may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Owner Trustee shall
determine to make such further inquiry or investigation, it shall be
entitled, to the same extent permitted to the Lessor under the Lease, to
examine the books and records of the Lessee to reasonably determine
whether the Lessee is in compliance with the terms and conditions of the
Lease and to examine the Aircraft, Airframe, Engines or any Part thereof
personally or by agent or attorney; and
(g) without limiting the generality of Section 3.05 hereof, except
as otherwise provided in written instructions given to the Owner Trustee
by the Trustor or as otherwise provided in the Indenture or the
Participation Agreement, the Owner Trustee shall not have any duty (i)
to see to any recording or filing of the Lease or of this Agreement or
any financing statement or other notice or document relating thereto or
contemplated under the Operative Agreements or to see to the maintenance
of any such recording or filing (other than FAA reporting requirements
contained in 14 C.F.R. Sections 47.45 and 47.51), (ii) to see to any
insurance on the Aircraft or any part thereof or to effect or maintain
any such insurance, whether or not the Lessee shall be in default with
respect thereto, other than to forward to the Trustor and (to the extent
provided in the Indenture) the Indenture Trustee copies of all
certificates, reports and other written information which it receives
from the Lessee pursuant to the Lease, (iii) to see to the payment or
discharge of any tax, assessment or other governmental charges or any
Lien (except any Lessor's Lien attributable to it in its individual
capacity) owing with respect to, or assessed or levied against any part
of the Lessor's Estate, (iv) to confirm or verify any financial
statements or reports of the Lessee, or (v) to inspect the Aircraft at
any time or ascertain or inquire as to the performance or observance of
any of the Lessee's covenants under the Lease.
Section 3.07. No Representations or Warranties as to Certain
Matters. NEITHER THE OWNER TRUSTEE NOR FIRST SECURITY BANK OF UTAH,
NATIONAL ASSOCIATION MAKES OR SHALL BE DEEMED TO HAVE MADE (a) ANY
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE,
AIRWORTHINESS, VALUE, CONDITION, WORKMANSHIP, DESIGN, COMPLIANCE WITH
SPECIFICATIONS, CONSTRUCTION, OPERATION, MERCHANTABILITY OR FITNESS FOR USE
FOR A PARTICULAR PURPOSE OF THE AIRCRAFT, AS TO THE ABSENCE OF LATENT OR
OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY
INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF
OBLIGATIONS BASED ON STRICT LIABILITY IN TORT, OR ANY OTHER REPRESENTATION
OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE AIRCRAFT OR
ANY PART THEREOF, except that FSBU represents and warrants that on the
Delivery Date the Owner Trustee shall have received whatever right, title
and interests in, to and under the Aircraft were conveyed to it by the
Lessee and FSBU represents, warrants and covenants that at all times on and
after the Delivery Date the Aircraft shall be free of all Lessor's Liens
attributable to it, and that the Owner Trustee shall comply with the last
sentence of Section 3.05(b) hereof, or (b) any representation or warranty
as to the validity, legality or enforceability of this Agreement or any
other Operative Agreement to which the Owner Trustee is a party, or any
other document or instrument, or as to the correctness of any statement
contained in any thereof, except to the extent that any such
representation, warranty or statement is expressly made herein or therein
as a representation or warranty by the Owner Trustee or FSBU and except
that FSBU hereby represents and warrants that this Agreement has been, and
(assuming the due authorization, execution and delivery of this Agreement
by the Trustor) the other Operative Agreements to which the Owner Trustee
is a party have been (or at the time of execution and delivery of any such
instrument by the Owner Trustee hereunder or pursuant to the terms of the
Participation Agreement that such an instrument will be) duly executed and
delivered by one of its officers who is or will be, as the case may be,
duly authorized to execute and deliver such instruments on behalf of the
Owner Trustee and that this Agreement has been duly authorized, executed
and delivered by FSBU and (assuming due authorization, execution and
delivery of this Trust Agreement by the Trustor) constitutes the legal,
valid and binding obligation of FSBU enforceable against it in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
rights of creditors generally and by general principles of equity.
Section 3.08. Status of Moneys Received. All moneys received by
the Owner Trustee under or pursuant to any provision of this Agreement or
any Operative Agreement shall constitute trust funds for the purpose for
which they were paid or are held, but need not be segregated in any manner
from any other moneys except to the extent required by law and may be
deposited by the Owner Trustee under such conditions as may be prescribed
or permitted by law for trust funds, or may be invested in direct
obligations of the United States.
Section 3.09. Self-Dealing. The Owner Trustee in its individual
capacity, or any corporation in or with which the Owner Trustee may be
interested or affiliated, or any officer or director of any such
corporation, may have normal commercial relations, and otherwise deal, in
the ordinary course of business, with the Lessee or any other corporation
having relations with the Lessee to the full extent permitted by law.
Section 3.10. Definition of a Responsible Officer. For purposes
of this Trust Agreement only, "Responsible Officer" when used with respect
to the Owner Trustee means the Chairman or the Vice-Chairman of the Board
of Directors, the Chairman or Vice-Chairman of the Executive Committee of
the Board of Directors, the President, any Vice President (whether or not
designated by a number or a word or words added before or after the title
"Vice President"), the Secretary, any Assistant Secretary, or any other
officer in the Corporate Trust Department of FSBU customarily performing
functions similar to those performed by any of the above designated
officers.
Section 3.11. Resignation or Removal of Owner Trustee. The Owner
Trustee or any successor thereof (a) shall resign if required to do so
pursuant to Section 7.02(b) of the Participation Agreement and (b) may
resign at any time without cause by giving at least 60 days' prior written
notice to the Trustor and the Indenture Trustee, such resignation in each
case to be effective only upon the appointment of a successor trustee and
the acceptance of such appointment by such successor. In addition, but
subject to Section 11.01 of the Participation Agreement, the Trustor may at
any time remove the Owner Trustee without cause by an instrument in writing
delivered to the Owner Trustee and the Indenture Trustee, such removal to
be effective only upon the appointment by the Trustor of a successor Owner
Trustee and the acceptance of such appointment by such successor. Upon the
giving of notice of resignation or removal of the Owner Trustee, the
Trustor may appoint a successor Owner Trustee by an instrument signed by
the Trustor. If the Trustor shall not have so appointed a successor Owner
Trustee within 30 days after such resignation or removal, the Owner
Trustee, the Indenture Trustee or the Trustor may apply to any court of
competent jurisdiction to appoint a successor Owner Trustee to act until
such time, if any, as a successor or successors shall have been appointed
by the Trustor as above provided. Any successor Owner Trustee so appointed
by a court shall be superseded by any successor Owner Trustee subsequently
appointed by the Trustor.
The appointment of any successor Owner Trustee shall be subject to
the conditions set forth in Section 11.01 of the Participation Agreement.
Section 3.12. Estate and Rights of Successor Owner Trustee. Any
successor Owner Trustee, however appointed, shall execute and deliver to
the predecessor Owner Trustee, with a copy to the Trustor and the Indenture
Trustee, an instrument accepting such appointment, and thereupon each
successor Owner Trustee, without further act, shall become vested with all
the estates, properties, rights, powers, duties and trust of the
predecessor Owner Trustee in the trusts hereunder with like effect as if
originally named as an Owner Trustee herein, but nevertheless upon the
written request of such successor Owner Trustee, such predecessor Owner
Trustee shall execute and deliver an instrument transferring to such
successor Owner Trustee, upon the trust herein expressed, all estates,
properties, rights, powers, duties, property or moneys then held by such
predecessor Owner Trustee upon the trusts herein expressed. Upon any such
transfer by a predecessor Owner Trustee, such predecessor Owner Trustee
shall provide the successor Owner Trustee and Trustor an accounting of the
Lessor's Estate and the trusts hereunder.
Upon the appointment of any successor Owner Trustee hereunder, the
predecessor Owner Trustee will use its best efforts to cause registration
of the Aircraft included in the Lessor's Estate to be transferred upon the
records of the Aeronautics Authority or other registry where the Aircraft
may then be registered into the name of the successor Owner Trustee and
shall otherwise use its best efforts to comply, or assist the successor
Owner Trustee in complying, with the provisions of Section 11.01 of the
Participation Agreement.
Section 3.13. Merger or Consolidation of FSBU. Any corporation
into which FSBU in its individual capacity may be merged or with which it
may be consolidated, or any corporation resulting from any merger or
consolidation to which FSBU shall be a party, or any corporation to which
substantially all the business of the Owner Trustee in its individual
capacity may be transferred, shall, subject to Section 3.12 hereof, be the
Owner Trustee under this Agreement without further act; provided, that such
corporation shall not also be the Indenture Trustee.
Section 3.14. Co-Trustees. At any time, subject to Section 7.13
of the Participation Agreement, if the Owner Trustee and the Trustor shall
deem it necessary or prudent or desirable in order to conform to legal
requirements of any jurisdiction in which any part of the Lessor's Estate
may at the time be located, the Trustor and the Owner Trustee jointly shall
have the power, and shall execute and deliver all instruments, to appoint
one or more Persons approved by the Trustor and the Owner Trustee, to act
as co-trustee, or co-trustees, jointly with the Owner Trustee, or separate
trustee or separate trustees (except insofar as local law makes it
necessary or prudent or desirable for any such co-trustee or separate
trustee to act alone), of all or any part of the Lessor's Estate, and to
vest in such Person or Persons, in such capacity, such title to the
Lessor's Estate or any part thereof, and such rights, powers, duties,
trusts or obligations as the Trustor and the Owner Trustee may consider
necessary or prudent or desirable. The Owner Trustee shall not be liable
for any act or omission of any co-trustee or separate trustee appointed
under this Section 3.14. No appointment of, or action by, any co-trustee
or separate trustee appointed under this Section 3.14 will relieve the
Owner Trustee of any of its obligations under any Operative Agreement or
otherwise affect any of the terms of the Indenture or adversely affect the
interests of the Indenture Trustee or the Certificate Holders in the Trust
Indenture Estate.
Any co-trustee or separate trustee may, at any time by an
instrument in writing, constitute the Owner 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
subject to the conditions of this Agreement.
Every additional trustee hereunder shall be a Citizen of the
United States and, to the extent permitted by law, be appointed and act,
and the Owner Trustee and its successors shall act, subject to the
following provisions and conditions:
(A) all powers, duties, obligations and rights conferred upon the
Owner Trustee in respect of the custody, control and management of
monies, the Aircraft or documents authorized to be delivered hereunder
or under the Participation Agreement shall be exercised solely by the
Owner Trustee;
(B) all other rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred or imposed upon and
exercised or performed by the Owner Trustee and such additional trustee
jointly, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed (including the
holding of title to the Lessor's Estate) the Owner 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 additional trustee;
(C) no power given to, or which is provided hereby may be
exercised by, any such additional trustee, except jointly with, or with
the consent in writing of, the Owner Trustee;
(D) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder except as otherwise
provided hereunder; and
(E) the Trustor, at any time, by an instrument in writing may
remove any such additional trustee.
Section 3.15. Interpretation of Agreements. In the event that
the Owner Trustee is unsure as to the application of any provision of this
Agreement or any other Operative Agreement or any other agreement relating
to the transactions contemplated by the Operative Agreements or such
provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement or any other Operative Agreement permits any determination by the
Owner Trustee or is silent or incomplete as to the course of action which
the Owner Trustee is required to take with respect to a particular set of
facts, the Owner Trustee shall request in writing instructions of the
Trustor and, to the extent that the Owner Trustee acts in good faith in
accordance with any instructions received from the Trustor, shall not be
liable to any Person; provided, that in the event that no response is made
to the Owner Trustee by the Trustor within 25 Business Days after such
request, the Owner Trustee shall not be liable to any Person for acts taken
by the Owner Trustee in good faith or for any failure to act, except to the
extent provided in the last sentence of Section 3.01 hereof.
Section 3.16. Not Acting in Individual Capacity. In carrying out
the trusts hereby created, the Owner Trustee will act solely as trustee
hereunder and not in its individual capacity except as expressly provided
herein or in the other Operative Agreements to which it is a party; and all
Persons, other than the Trustor as provided in this Agreement, having any
claim against the Owner Trustee by reason of the transactions contemplated
hereby shall look only to the Lessor's Estate for payment or satisfaction
thereof, except to the extent provided in the last sentence of Section 3.01
hereof.
Section 3.17. Tax Returns. The Owner Trustee shall be
responsible for the keeping of all appropriate books and records relating
to the receipt and disbursement of all moneys under this Agreement or any
Operative Agreement. The Trustor shall be responsible for causing to be
prepared and filed all income tax returns required to be filed by the
Trustor. The Owner Trustee, upon request of the Trustor and at the expense
of the Lessee, will furnish the Trustor with all such information as may be
reasonably required or advisable from the Owner Trustee in connection with
the preparation of such tax returns and in connection with any other filing
or audit and related litigation obligations. The Owner Trustee shall be
responsible for causing to be prepared at the request of the Trustor, but
at the expense of the Lessee, all income tax returns required to be filed
with respect to the trust created hereby and shall execute and file such
returns; provided, that the Owner Trustee shall deliver a completed copy of
all such returns to the Trustor not more than 60 nor less than 30 days
prior to the due date of the return (provided that the Owner Trustee shall
have timely received all necessary information to complete such return).
The Trustor, upon request, will furnish the Owner Trustee with all such
information as may be reasonably required from the Trustor that is in its
possession in connection with the preparation of such income tax returns.
ARTICLE 4
TERMINATION OF TRUST
Section 4.01. Termination. This Agreement and the trust created
and provided for hereby shall cease and be terminated in any one of the
following events, whichever shall first occur:
(a) The sale or other final disposition by the Owner Trustee of
all of its interest in all property constituting or included in the
Lessor's Estate and, if the Indenture shall then be in effect, the sale
or other disposition by the Indenture Trustee of all of its interest in
all property constituting or included in the Lessor's Estate, and the
final disposition by the Owner Trustee and, if the Indenture shall then
be in effect, the Indenture Trustee, of all moneys or other property or
proceeds constituting part of the Lessor's Estate in accordance with the
terms hereof; or
(b) 110 years from the earlier execution of this Agreement by
either party hereto; provided, however, that if the Trust shall be or
become valid under applicable law for a period subsequent to 110 years
from the earlier execution of this Agreement by either party hereto or,
without limiting the generality of the foregoing, if legislation shall
become effective providing for the validity or permitting the effective
grant of such trust for a period, in gross, exceeding the period for
which such trust is hereinabove stated to extend and be valid, then such
trust shall not terminate as provided in the first part of this sentence
but shall extend to and continue in effect until, but only if such non-
termination and extension shall then be valid under applicable law, such
time as the same shall, under applicable law, cease to be valid.
Section 4.02. Termination at Option of the Trustor.
Notwithstanding Section 4.01 hereof, this Agreement and the trust created
hereby shall terminate and the Trust Estate shall be distributed to the
Trustor, and this Agreement shall be of no further force and effect, upon
the election of the Trustor by notice to the Owner Trustee, if such notice
shall be accompanied by the written agreement (in form and substance
satisfactory to the Owner Trustee) of the Trustor assuming all the
obligations of the Owner Trustee under or contemplated by the Operative
Agreements or incurred by it as trustee hereunder and releasing the Owner
Trustee therefrom; provided, however, that such notice may be given only
after the time the Lien of the Indenture is discharged under Section 14.01
of the Indenture unless the Trustor shall have received the prior written
consent of the Indenture Trustee to any such termination in which case such
notice may be given while the Lien of the Indenture is outstanding.
Section 4.03. Distribution of Lessor's Estate upon Termination.
Upon any termination of this trust pursuant to the provisions of Section
4.01 hereof, the Owner Trustee shall convey the Lessor's Estate (subject to
all obligations, if any, of the Owner Trustee then existing under the
Operative Agreements to which the Owner Trustee is a party) to such
purchaser or purchasers or the Trustor, as the case may be, and for such
amount and on such terms as shall be specified in written instructions from
the Trustor delivered to the Owner Trustee prior to the date of
termination; provided, that (i) if at the time of any termination the Lease
remains in force and effect, then the Lessor's Estate shall be sold as a
unit (and not in parcels) and subject to the Lease, and (ii) in the event
such written instructions are not delivered to the Owner Trustee on or
before the date of termination, the Owner Trustee shall transfer title to
the Lessor's Estate to the Trustor. Upon making such transfer or sale and
accounting for all funds which have come into its hands, the Owner Trustee
shall be entitled to receipt of any sums due and owing to the Owner Trustee
for expenses incurred pursuant hereto as set forth in Section 2.05 hereof.
ARTICLE 5
TRANSFER OF BENEFICIAL INTEREST
The Trustor may assign, convey or otherwise transfer to a single
institutional investor all (but not less than all) of the Beneficial
Interest, provided that it gives the Lessee, the Indenture Trustee and the
Owner Trustee at least 10 Business Days' notice of such assignment,
conveyance or other transfer and provided, further that the Trustor and the
Owner Participant Guarantor agree by a written instrument in form and
substance reasonably satisfactory to the Lessee, the Indenture Trustee and
the Owner Trustee to remain liable for all obligations of the Trustor under
this Agreement and the other Operative Agreements to which the Trustor is a
party to the extent (but only to the extent) incurred on or before the date
of such transfer and provided that the transferee agrees by a written
instrument in form and substance reasonably satisfactory to the Lessee, the
Indenture Trustee and the Owner Trustee to assume primary liability for all
obligations as a trustor under this Agreement and the other Operative
Agreements to which such trustor is a party incurred after the date of
transfer; provided, further, that (a) such transferee is (i) a bank,
savings institution, finance company, leasing company or trust company or
national banking association acting for its own account (subject to the
transferee's ability to satisfy the requirements set forth in clause (c)
below) or in a fiduciary capacity as trustee or agent under any pension,
retirement, profit sharing or similar trust or fund, insurance company,
fraternal benefit society or corporation acting for its own account having
a combined capital and surplus (or, if applicable, consolidated tangible
net worth or its equivalent) of not less than $75,000,000, (ii) a
subsidiary of any Person described in clause (i) where such Person provides
(A) support for the obligations assumed by such transferee subsidiary
satisfactory to the Lessee, the Owner Trustee and the Indenture Trustee or
(B) an unconditional guaranty satisfactory to the Lessee, the Owner Trustee
and the Indenture Trustee of such transferee subsidiary's obligations, or
(iii) an Affiliate of the original Trustor, so long as such Affiliate has a
combined capital and surplus (or, if applicable, consolidated tangible net
worth or its equivalent) of not less than $75,000,000, (b) such transferee
is legally capable of binding itself to the obligations of the Trustor and
expressly agrees to assume all obligations of the Trustor under the
Participation Agreement and this Agreement and (c) such transferee shall
provide representations substantially similar to those contained in
Sections 7.02(a) and 7.03(a) of the Participation Agreement. In the event
of any such assignment, conveyance or transfer, the transferee shall become
a party to this Agreement and shall agree to be bound by all the terms of
and will undertake all of the obligations of the Trustor contained in this
Agreement and the other Operative Agreements in such manner as is
reasonably satisfactory to the Owner Trustee and the Indenture Trustee. A
transferee hereunder shall be (i) a "U.S. Person" as defined in Section
7701(a)(30) of the Code (or any successor provision thereto) or if the
transferee shall not be such a "U.S. Person" then each Certificate Holder
shall be provided an indemnity (from the transferee trustor or the Trustor
but not from the Lessee) in form and substance satisfactory to each such
Certificate Holder, for any Taxes that may be imposed on such Certificate
Holders (currently or in the future) due to such transferee's failure to be
such a "U.S. Person" and (ii) a Citizen of the United States or shall have
established a voting trust, voting powers or other arrangement reasonably
satisfactory to the Indenture Trustee to permit the Owner Trustee to be the
registered owner of the Aircraft under the Transportation Code. Assuming
the truth of the representations made in Sections 6.01(m) and 7.09 of the
Participation Agreement and compliance with Section 10.06 of the Indenture,
no such assignment, conveyance or transfer shall violate any provision of
law or regulation or create a relationship which would be in violation
thereof. The Owner Trustee shall not be on notice of or otherwise bound by
any such assignment, conveyance or transfer unless and until it shall have
received an executed counterpart of the instrument of such assignment,
conveyance or transfer. Upon any such disposition by the Trustor to a
transferee as above provided, the transferee shall be deemed the "Trustor"
for all purposes hereof, and shall be deemed to have made all the payments
previously made by its transferor and to have acquired the same interest in
the Lessor's Estate as theretofore held by its transferor; and each
reference herein to the "Trustor" shall thereafter be deemed a reference to
such transferee. Notwithstanding anything to the contrary contained in
this Article 5, in no event shall the Trustor transfer its interest in the
Beneficial Interest to any entity whose business is that of a nationwide or
worldwide overnight or expedited delivery small package air courier, cargo
or freight deliverer or which competes with the Lessee in one of its
principal lines of business (except for any line of business in the
financial services industry).
ARTICLE 6
MISCELLANEOUS
Section 6.01. Indemnification. The Trustor agrees to reimburse
and save FSBU harmless against any and all loss, damage, liability, claims,
demands, disbursements and expenses, including taxes (excluding taxes
imposed against FSBU upon or with respect to any fees or compensation for
services rendered by the Owner Trustee and FSBU hereunder) and reasonable
counsel fees (any "Loss"), which may be incurred by reason of its being the
Owner Trustee or acting hereunder or under the Operative Agreements or the
Original Agreements, but solely by reason thereof and arising out of or
relating solely to this Agreement or the other Operative Agreements or the
Original Agreements or the Aircraft or the Rent and other sums payable
therefor, or by reason of any occurrence directly relating thereto while so
acting, and to secure the payment thereof, the Owner Trustee, in its
individual capacity, shall have a Lien on the Lessor's Estate and the
proceeds thereof, including income, prior to any interest therein of the
Trustor and its assigns (but subject to the rights of the Lessee under the
Operative Agreements and the Original Agreements and subject and
subordinate to the Lien of the Indenture); provided, that the Trustor shall
have no obligation hereunder to indemnify FSBU for any Losses arising from
or the result of (A) the Owner Trustee's willful misconduct or gross
negligence (in its individual capacity or as trustee), (B) any inaccuracy
of any representation of the Owner Trustee or any breach by the Owner
Trustee of its warranties and covenants given in its individual capacity in
this Agreement, Sections 7.01(c), 7.02(a) and (b) and 7.04 of the
Participation Agreement and its representations and warranties in Section
3.08 of the Indenture or elsewhere in the Operative Agreements, (C) the
failure to use ordinary care in receiving, handling and disbursing funds,
(D) Lessor's Liens attributable to it in its individual capacity, (E)
taxes, fees, or other charges on, based on, or measured by, any fees,
commissions or compensation received by FSBU or the Owner Trustee in
connection with the transactions contemplated by the Lease, the Indenture
and this Agreement, (F) taxes excluded from indemnification pursuant to
Section 8.01(b) of the Participation Agreement (disregarding for the
purposes of this Section 6.01, subsections (iii) and (vi) of Section
8.01(b) of the Participation Agreement) and subsections (ii), (iv), (vi),
and (viii) of Section 9.01(b) of the Participation Agreement); provided,
that, before asserting any right to payment or indemnification hereunder,
the Owner Trustee shall first demand (but need not exhaust its remedies
with respect to) its corresponding right to payment or indemnification from
the Lessee pursuant to the Participation Agreement. It is further
understood that the distribution by the Owner Trustee of all or any part of
the Lessor's Estate as provided in Section 4.02 of this Agreement shall not
impair the right of FSBU to indemnity, payment and reimbursement as herein
provided. In the event FSBU makes any advances at any time to pay or to
provide for the payment of any such Loss, then FSBU shall be entitled, in
addition to reimbursement for the principal of the sum so advanced, to
interest on the amount of such advances at the Prime Rate. The provisions
of this Section shall continue in force and effect notwithstanding the
termination of this trust or the resignation, inability or incapacity to
act or removal of the Owner Trustee. The Owner Trustee (in its individual
capacity or as trustee) agrees that it shall have no right against (except
as provided in this Section 6.01) the Trustor or (subject to the provisions
of the Indenture) the Trust Indenture Estate for any fee as compensation
for its services hereunder.
Section 6.02. Supplements and Amendments. At any time and from
time to time, only upon the written request of the Trustor (a) FSBU and
the Trustor shall execute a supplement hereto for the purpose of adding
provisions to, or changing or eliminating provisions of, this Agreement as
specified in such request and (b) the Owner Trustee shall, subject to the
provisions of Article XIII of the Indenture, enter into or consent to such
written amendment or modification of or supplement to any of the Operative
Agreements as the Indenture Trustee and any other necessary parties may
agree to in writing and as may be specified in such request, or execute and
deliver such written waiver of the terms of any of the Operative Agreements
as may be agreed to in writing by the Indenture Trustee and as may be
specified in such request; provided, that (i) the Owner Trustee shall not
execute any such supplement, amendment, waiver or modification without the
prior written consent of the Trustor, (ii) if in the reasonable opinion of
the Owner Trustee any document required to be executed by it pursuant to
this Section adversely affects any right or duty of, or immunity or
indemnity in favor of, the Owner Trustee under this Agreement or any other
Operative Agreement, the Owner Trustee may in its discretion decline to
execute such document and (iii) any amendment or supplement to this
Agreement that would adversely affect the rights of the Indenture Trustee
or the Holders shall be subject to the prior written consent of the
Indenture Trustee. It shall not be necessary that any request pursuant to
this Section specify the particular form of the proposed document to be
executed pursuant to such request, but it shall be sufficient if such
request shall indicate the substance thereof. Promptly after the execution
by FSBU or the Owner Trustee of any document pursuant to this Section, the
Owner Trustee shall mail a conformed copy thereof to the Trustor, the
Indenture Trustee and the Lessee, but the failure of the Owner Trustee to
mail such conformed copies shall not impair or affect the validity of such
document.
Section 6.03. Nature of Title of Trustor. The Trustor shall not
have any legal title to any part of the Lessor's Estate. No transfer, by
operation of law or otherwise, of the right, title and interest of the
Trustor in and to the Lessor's Estate or the trusts hereunder shall operate
to terminate this Agreement or Lessor's Estate, except as provided in
Section 4.01 hereof.
Section 6.04. Power of Owner Trustee to Convey. Any assignment,
sale, transfer or other conveyance by the Owner Trustee of the interest of
the Owner Trustee in the Operative Agreements or in the Aircraft or any
part thereof pursuant to and in compliance with the terms of this Agreement
or the Operative Agreements shall bind the Trustor and shall be effective
to transfer or convey all right, title and interest of the Owner Trustee
and the Trustor in and to the Operative Agreements or the Aircraft or such
part thereof. No purchaser or other grantee shall be required to inquire
as to the authorization, necessity, expediency or regularity of such
assignment, sale, transfer or conveyance or as to the application of any
sale or other proceeds with respect thereto by the Owner Trustee.
Section 6.05. Notices. All notices, demands, declarations and
other communications required by this Agreement shall be in writing and
shall be deemed received (a) if given by telecopier, when transmitted and
the appropriate telephonic confirmation received if transmitted on a
Business Day and during normal business hours of the recipient, and
otherwise on the next Business Day following transmission, (b) if given by
certified mail, return receipt requested, postage prepaid five Business
Days after being deposited in the United States mail, and (c) if given by
FedEx service or other means, when received or personally delivered,
addressed:
If to the Owner Trustee:First Security Bank of Utah, National Association
79 South Main Street
Salt Lake City, Utah 84111
Attention: Corporate Trust Department
Telephone: (801) 246-5826
Facsimile: (801) 246-5053
If to the Trustor: Boatmen's Equipment Finance, Inc.
One Boatmen's Plaza
800 Market Street
P.O. Box 236
St. Louis, Missouri 63166
Attention: Documentation Specialist
Telephone: (314) 466-4275
Facsimile: (314) 466-4266
If to the Indenture
Trustee: State Street Bank and Trust Company
Two International Place
4th Floor
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Telephone: (617) 664-5414
Facsimile: (617) 664-5371
or as to any of the foregoing parties at such other address as such party may
designate by notice duly given in accordance with this Section to the other
parties.
Section 6.06. Situs of Trust; Applicable Law;
Severability. THIS AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF UTAH,
INCLUDING ALL MATTERS OF VALIDITY, CONSTRUCTION AND PERFORMANCE. If any
provision of this Agreement shall be invalid or unenforceable, the
remaining provisions hereof shall continue to be fully effective; provided,
that such remaining provisions do not increase the obligations or
liabilities of the Owner Trustee or the Trustor.
Section 6.07. Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of, and shall be enforceable
by, the parties hereto and their respective successors and permitted
assigns, including any successive holder of the Beneficial Interest, but
only to the extent the Beneficial Interest has been transferred or assigned
in accordance with the limitations of Article 5 of this Agreement.
Section 6.08. Headings and Table of Contents. The headings
of the Articles and Sections of this Agreement and the Table of Contents
are inserted for convenience only and shall not affect the meaning or
construction of any of the provisions hereof.
Section 6.09. Definitions. The capitalized terms used
herein, unless otherwise herein defined or the context hereof shall
otherwise require, shall have the respective meanings set forth in Schedule
I attached hereto.
Section 6.10. Identification of Trust. This trust may for
convenience be referred to as the "Federal Express Corporation Trust No.
N582FE."
Section 6.11. Counterparts. This instrument may be
executed in any number of counterparts or upon separate signature pages
bound together in several counterparts, each of which when so executed
shall be deemed to be an original, and such counterparts together shall
constitute and be one and the same instrument.
Section 6.12. Trustor Interest. The Trustor has only a
beneficial interest in any specific property of this trust. No creditor of
the Trustor shall have any right to obtain possession of, or otherwise
exercise legal or equitable remedies with respect to, the property of this
trust (as opposed to the Trustor's beneficial interest in this trust).
IN WITNESS WHEREOF, FSBU and the Trustor have caused this
Agreement to be duly executed all as of the date first above written.
BOATMEN'S EQUIPMENT FINANCE, INC.
By: _______________________________________
Name:
Title:
FIRST SECURITY BANK OF UTAH,
NATIONAL ASSOCIATION
By: _______________________________________
Name:
Title:
SCHEDULE I
DEFINITIONS
GENERAL PROVISIONS
The following terms shall have the following meanings for all
purposes of the Operative Agreements (other than the Pass Through Agreement
and the Series Supplements) referred to below, unless otherwise defined in an
Operative Agreement or the context thereof shall otherwise require. In the
case of any conflict between the provisions of this Schedule and the
provisions of any Operative Agreement, the provisions of such Operative
Agreement shall control the construction of such Operative Agreement.
Unless the context otherwise requires, (i) references to agreements
shall be deemed to mean and include such agreements as amended and
supplemented from time to time, and (ii) references to parties to agreements
shall be deemed to include the successors and permitted assigns of such
parties.
DEFINED TERMS:
Additional Insured. As defined in Article 13 of the Lease.
Additional Leverage Amount. An amount equal to 5.124835742% of the
outstanding principal amount of the Original Loan Certificates to be
refinanced on the Refunding Date.
Aeronautics Authority. As appropriate, the Federal Aviation
Administration and/or the Administrator of the Federal Aviation
Administration, any successor to the former United States Civil Aeronautics
Board, or any Person, governmental department, bureau, commission or agency
located in the United States succeeding to the functions of any of the
foregoing.
Affiliate. With respect to any Person, any other Person directly
or indirectly controlling, controlled by or under common control with such
Person. For the purposes of this definition, "control" (including
"controlled by" and "under common control with") shall mean the power,
directly or indirectly, to direct or cause the direction of the management
and policies of such Person whether through the ownership of voting
securities or by contract or otherwise. In no event shall the Owner
Trustee or the Lessor be deemed an Affiliate of the Owner Participant.
After-Tax Basis. A basis such that any payment received or deemed
to have been received by a Person shall be supplemented by a further
payment to such Person so that the sum of the two payments, after deduction
of all Taxes resulting from the receipt or accrual of such payments, shall
be equal to the payment received or deemed to have been received. In the
case of amounts payable to the Lessor, the Owner Participant, or any
corporate Affiliate of the Owner Participant, it shall be presumed that
such Person is at all times subject to Federal income tax at the maximum
marginal rate generally applicable to corporations from time to time and
actual state, local and foreign income taxes.
Agent. Morgan Guaranty Trust Company of New York and its
successors and permitted assigns as Agent for the Original Loan
Participants pursuant to Article 16 of the Original Participation
Agreement.
Air Carrier. Any U.S. Air Carrier and any "foreign air carrier"
(as defined in the Transportation Code) as to which there is in force a
permit granted under Section 41302 of the Transportation Code.
Aircraft. The Airframe (or any permitted substitute airframe)
together with three Engines (whether any of which is an initial Engine or a
Replacement Engine) whether or not any of such initial or Replacement
Engines may from time to time be installed on such Airframe or may be
installed on any other airframe or on any other aircraft, including any
aircraft substituted pursuant to Section 11.03 of the Lease.
Airframe. The McDonnell Douglas MD-11F aircraft (excluding the
Engines or engines from time to time installed thereon) leased by the Lessor
to the Lessee pursuant to the Lease and the initial Lease Supplement and
having the United States FAA Registration Number initially and manufacturer's
serial number specified in the initial Lease Supplement, including (i) all
Parts in respect thereof and (ii) any replacement airframe which may be
substituted pursuant to Section 11.03 of the Lease.
Amendment No. 1 to the Original Tax Indemnity Agreement. Amendment
No. 1 to the Original Tax Indemnity Agreement (Federal Express Corporation
Trust No. N582FE), dated as of June 1, 1996.
Ancillary Agreement. Any written agreement of the Lessee to which
the Lessor is a party or to which the Lessor has consented in writing
entered into on the Delivery Date or the Refunding Date or any date
thereafter in connection with the transactions contemplated by the
Operative Agreements, as such agreement may be amended and supplemented
from time to time with the consent of the Lessor and delivered to the Owner
Trustee, the Indenture Trustee, the Pass Through Trustee and the Owner
Participant.
Ancillary Agreement I. The Ancillary Agreement I (Federal Express
Corporation Trust No. N582FE), dated the Delivery Date, as amended and
restated as of the Refunding Date, among the Lessee, the Owner Trustee, not
in its individual capacity, but solely as Owner Trustee, the Owner
Participant and the Indenture Trustee not in its individual capacity, but
solely as Indenture Trustee, as originally executed or as amended, modified
or supplemented with the consent of all the parties thereto.
Ancillary Agreement II. The Ancillary Agreement II (Federal
Express Corporation Trust No. N582FE), dated the Refunding Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as
Owner Trustee, the Owner Participant and the Indenture Trustee not in its
individual capacity, but solely as Indenture Trustee, as originally
executed or as amended, modified or supplemented with the consent of all
the parties thereto.
Appraisal. The report prepared by BK Associates, Inc. and
delivered to the Owner Participant on the Delivery Date pursuant to Section
4.01(n) of the Original Participation Agreement.
Bankruptcy Code. The Federal Bankruptcy Code of 1978, as amended,
and any successor thereto.
Bankruptcy Default. An event specified in Section 16.01(e), (f) or
(g) of the Lease which either does or, with the giving of notice or lapse of
time or both, would constitute an Event of Default.
Basic Rent. The aggregate periodic rent payable for the Aircraft
throughout the Basic Term pursuant to Section 3.02 of the Lease, adjusted
pursuant to Article 3 of the Lease.
Basic Term. The period commencing at the beginning of the day on
the Commencement Date and ending at the end of the day on July 29, 2016, or
such earlier date on which the Lease shall be terminated as provided
therein.
Beneficial Interest. The interest of the Owner Participant under
the Trust Agreement.
Bills of Sale. Collectively, the FAA Bill of Sale and the Warranty
Bill of Sale.
Breakage Costs. Has the meaning specified in Schedule II to the
Original Participation Agreement.
Business Day. Any day on which commercial banks are not
authorized or required to close in New York, New York, Memphis,
Tennessee and the city in which the office or agency in the United
States is maintained by the Pass Through Trustee for the payment of
the Pass Through Certificates, and after the Lien of the Indenture is
discharged, Salt Lake City, Utah.
Certificates. The Equipment Trust Certificates (Federal Express
Corporation Trust No. N582FE), issued by the Owner Trustee pursuant to the
Indenture and any certificate issued in exchange therefor or replacement
thereof pursuant to the Indenture.
Change in Tax Rate. Any amendment, modification, deletion,
addition, or change to the Code which is enacted into law after the
Delivery Date which changes the highest marginal statutory rate of Federal
income tax applicable to the Owner Participant (other than a change which
is in the nature of a minimum tax).
Citizen of the United States. A citizen of the United States as
defined in Section 40102(a)(15) of the Transportation Code, or any analogous
part of any successor or substituted legislation or regulation at the time in
effect.
Closings. The closing with respect to the acquisition of the Pass
Through Certificates by the Underwriters and the closing with respect to the
refunding of the Original Loan Certificates.
Code. Except as otherwise provided, the Internal Revenue Code of
1986, as amended from time to time.
Commencement Date. July 30, 1996.
Corporate Trust Administration. The principal office of the
Indenture Trustee located at Two International Place, 4th Floor, Boston,
Massachusetts 02110, Attention: Corporate Trust Department, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Participant and the Owner Trustee.
Corporate Trust Department. The principal office of the Owner
Trustee located at 79 South Main Street, Salt Lake City, Utah 84111,
Attention: Corporate Trust Department, or such other office at which the
Owner Trustee's corporate trust business shall be administered which the
Owner Trustee shall have specified by notice in writing to the Lessee, the
Owner Participant and the Indenture Trustee.
CRAF Program. Has the meaning specified in Section 7.01(f) of the
Lease.
Debt Rate. The weighted average (based on Outstanding principal
amount) rate of interest on the Certificates issued pursuant to the
Indenture.
Default. Any event or condition which, with the lapse of time or
the giving of notice, or both, would constitute an Event of Default.
Delivery Date. April 22, 1996.
Engine. Each of the three General Electric CF6-80C2-D1F engines
listed by its manufacturer's serial number in the initial Lease Supplement
and leased pursuant to the Lease, whether or not from time to time
installed on the Airframe or installed on any other airframe or on any
other aircraft, and any Replacement Engine which may from time to time be
substituted for an Engine pursuant to Section 7.02(a)(vii), 10.03, 11.03,
11.04 or 12.02 of the Lease, together with all Parts related thereto.
Except as otherwise provided, at such time as a Replacement Engine shall be
so substituted and the Engine for which the substitution is made shall be
released from the Lien of the Indenture, such replaced Engine shall cease
to be an "Engine" under the Lease. The term "Engines" means, as of any
date of determination, all Engines then leased to the Lessee pursuant to
the Lease.
Engine Consent. The Engine Consent dated as of April 1, 1996,
executed by the Engine Manufacturer, as the same may be amended, modified or
supplemented from time to time.
Engine Manufacturer. General Electric Company, a New York
corporation.
Engine Warranty Assignment. The Engine Warranty Assignment (Federal
Express Corporation Trust No. N582FE), dated as of April 1, 1996 between the
Lessor and the Lessee, as the same may be amended, modified or supplemented
from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan. As defined in Section 7.06 of the Participation
Agreement.
Estimated Expense Amount. Has the meaning specified in Section
10.01(a) of the Participation Agreement.
Event of Default. Each of the events specified in Article 16 of the
Lease.
Event of Loss. Any of the following events with respect to the
Aircraft, the Airframe or any Engine: (i) loss of such property or its use
(A) due to theft or disappearance for a period in excess of 30 days (or
such longer period not to exceed 60 days from the end of such 30 day period
if and so long as the location of such property is known and the Lessee is
pursuing the recovery thereof) or to the end of the Term, if less, unless
such event constitutes an Event of Loss under clause (i)(B) or clause (ii)
below, or (B) due to the destruction, damage beyond economic repair or
rendition of such property permanently unfit for normal use by Lessee for
any reason whatsoever; (ii) any damage to such property which results in
an insurance settlement with respect to such property on the basis of a
total loss, or constructive or compromised total loss; (iii) (1)
condemnation, confiscation or seizure of, or requisition of title to such
property by the Government, any foreign government or purported government
or any agency or instrumentality thereof, or (2) condemnation,
confiscation, or seizure of, or requisition or taking of, use of such
property (A) by a foreign government, or instrumentality or agency of any
such foreign government, or any purported government or instrumentality or
agency thereof for a period in excess of 180 days, or (B) by the Government
for a period extending beyond the Term provided that no Event of Loss shall
be deemed to have occurred, and the Term shall be extended automatically
for a period of up to six months beyond the end of the Term in the event
that the Aircraft or the Airframe or any Engine is requisitioned by the
Government pursuant to an activation as part of the CRAF Program described
in Section 7.02(a)(iv) of the Lease; or (iv) as a result of any law, rule,
regulation, order or other action by the Aeronautics Authority or other
governmental body having jurisdiction, the use of the Aircraft or Airframe
in the normal course of air transportation of cargo shall have been
prohibited for a period of four (4) consecutive months, unless the Lessee,
prior to the expiration of such four (4) month period, shall be diligently
carrying forward all steps which are necessary and desirable to permit the
normal use of the Aircraft or Airframe provided, however, that an Event of
Loss shall be deemed to have occurred if (x) the Lessee fails to continue
diligently carrying forward all such steps or (y) the use of the Aircraft
or the Airframe in the normal course of air transportation of cargo shall
have been prohibited for a period of an additional 8 months following such
4 month period or (z) unless waived by the Lessor, the Term shall have
expired. The date of such Event of Loss shall be (t) the 30th day or the
90th day, as the case may be, following loss of such property or its use
due to theft or disappearance; (u) the date of any destruction, damage
beyond economic repair or rendition of such property permanently unfit for
normal use; (v) the date of any insurance settlement on the basis of a
total loss or constructive or compromised total loss; (w) the date of any
condemnation, confiscation, seizure or requisition of title of such
property; (x) the earlier of the 181st day following condemnation,
confiscation, seizure or requisition for use of such property by a foreign
government or instrumentality or agency thereof or the end of the Term;
(y) the last day of the Term in the case of requisition for use of such
property by the Government or (z) the last day of the 4 month or additional
8 month period, referred to in clause (iv) above. An Event of Loss with
respect to the Aircraft shall be deemed to have occurred if any Event of
Loss occurs with respect to the Airframe.
Excepted Payments. Collectively, (i) indemnity or other payments
of expenses paid or payable by the Lessee in respect of the Owner
Participant, the Owner Trustee in its individual capacity or any of their
respective successors, permitted assigns, directors, officers, employees,
servants and agents or Affiliates, pursuant to Article 8, 9, or 10 and
Section 15.01 of the Participation Agreement or any indemnity hereafter
granted to the Owner Participant or the Owner Trustee in its individual
capacity pursuant to Section 7.01(e), Article 9 or Section 11.03(a) of the
Lease or Section 15.01 of the Participation Agreement, (ii) proceeds of
public liability insurance (or government indemnities in lieu thereof) in
respect of the Aircraft payable as a result of insurance claims paid for
the benefit of, or losses suffered by, the Owner Trustee or the Indenture
Trustee in their respective individual capacities or by the Owner
Participant, or their respective successors, permitted assigns or
Affiliates, (iii) proceeds of insurance maintained with respect to the
Aircraft by the Owner Participant (whether directly or through the Owner
Trustee) maintained in accordance with the provisions of but not required
under Article 13 of the Lease, (iv) all right, title and interest of the
Owner Participant in, to and under the Tax Indemnity Agreement and payments
of Supplemental Rent by the Lessee in respect of any amounts payable under
the Tax Indemnity Agreement, (v) any amounts payable by the Lessee to the
Owner Participant or the Owner Trustee in its individual capacity, after
the release thereof from the Lien of the Indenture, (vi) subject to Section
3.05 of the Lease, payments constituting increases in Basic Rent
attributable to payments arising pursuant to Section 5 of the Tax Indemnity
Agreement, (vii) any right to demand, collect or otherwise receive and
enforce the payment of any amount described in clauses (i) through (vi)
above and (viii) any payments in respect of interest to the extent
attributable to the payments referred to in clauses (i) through (vi) above.
Excess Amount. The amount described in Section 2.03 of the
Participation Agreement and set forth on Schedule II to the Lease.
Exempt Recipient. A person described in Section 6049(b)(4) of the
Code.
Expense; Expenses. Have the meaning specified in Section 9.01(a) of
the Participation Agreement.
FAA Bill of Sale. The bill of sale for the Airframe on AC Form
8050-2, or such other form as may be approved by the Aeronautics Authority,
executed by the Lessee in favor of the Owner Trustee and dated the Delivery
Date.
FPO Price. Has the meaning specified in Section 4.02(a)(F) of the
Lease.
FSBU. First Security Bank of Utah, National Association, a national
banking association.
FSC. Savannah International Sales, Inc., a United States Virgin
Islands corporation.
Fair Market Renewal Term. A term with respect to which the Lessee
has exercised its option to renew the Lease pursuant to the second
paragraph of Section 4.01(a) thereof and with respect to which the
conditions set forth in such Section 4.01(a) are met.
Fair Market Rental. An amount determined on the basis of, and
equal in amount to, the rental which would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and
willing lessor unaffiliated with such lessee, neither being under any
compulsion to lease. In such determination, except for purposes of Section
17.01 of the Lease, it shall be assumed that the Aircraft is in at least
the condition required under the Lease in the case of return of the
Aircraft pursuant to Article 12 of the Lease and Fair Market Rental shall
be determined in accordance with the provisions of Section 4.03 of the
Lease. For purposes of Section 17.01 of the Lease, such determination
shall be made on an "as is, where is" basis by a qualified independent
appraiser selected by the Lessor and the costs and expenses of the
appraisal shall be borne by the Lessee, unless the Lessor has not obtained
possession of the Aircraft pursuant to such Section 17.01, in which case an
appraiser shall not be appointed and such Fair Market Rental shall be
deemed to be zero.
Fair Market Value. An amount determined on the basis of, and
equal in amount to, the value which would be obtained in an arm's-length
transaction between an informed and willing purchaser under no compulsion
to buy and an informed and willing seller unaffiliated with such purchaser
and under no compulsion to sell, assuming the Aircraft (or other property)
is unencumbered by the Lease. In such determination, except for purposes
of Section 17.01 of the Lease, it shall be assumed that the Aircraft is in
at least the condition required under the Lease in the case of return of
the Aircraft pursuant to Article 12 of the Lease and Fair Market Value
shall be determined in accordance with the provisions of Section 4.03 of
the Lease. For purposes of Section 17.01 of the Lease, such determination
shall be made on an "as is, where is" basis by a qualified independent
appraiser selected by the Lessor and the costs and expenses of the
appraisal shall be borne by the Lessee, unless the Lessor has not obtained
possession of the Aircraft free and clear of all Liens and unencumbered by
the Lease pursuant to such Section 17.01, in which case an appraiser shall
not be appointed and such Fair Market Value shall be deemed to be zero.
Federal Aviation Administration; FAA. The United States Federal
Aviation Administration and any successor agency or agencies thereto.
Fixed Renewal Rent. Semi-annual payments of rent during the Fixed
Renewal Term equal to the lesser of (i) Fair Market Rental as determined
as of the commencement of such Fixed Renewal Term and (ii) 50% of the
average actual semi-annual Basic Rent payable during the Basic Term.
Fixed Renewal Term. The term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the first paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth
in such Section 4.01(a) are met.
Government. The United States of America or an agency or
instrumentality thereof the obligations of which bear the full faith and
credit of the United States of America.
GTA. The General Terms Agreement dated as of July 3, 1991 between
the Engine Manufacturer and the Lessee related to the purchase by the
Lessee of the Engines as originally executed or as modified, amended or
supplemented in accordance with the terms thereof, but only insofar as the
General Terms Agreement relates to the Engines, to the extent assigned to
the Owner Trustee pursuant to the Engine Warranty Assignment.
Holder of a Certificate; Certificate Holder; Holder. As of any
particular time, the Person in whose name a Certificate shall be registered
(but not including the holder of any Pass Through Certificate).
Indemnitee. Each of FSBU, in its individual capacity and as Owner
Trustee and Lessor, the Agent (to the extent set forth in Articles 8 and 9
of the Original Participation Agreement), the Owner Participant, the
Original Loan Participants (to the extent set forth in Articles 8 and 9 of
the Original Participation Agreement), the Indenture Trustee, in its
individual capacity and as trustee, the Owner Participant Guarantor, and
any successor (including any trustee which may succeed to the Lessor's
interest under the Lease), Affiliate, assign, officer, director, employee,
agent and servant of any of the foregoing, the Lessor's Estate and the
Trust Indenture Estate.
Indenture. The Trust Indenture and Security Agreement (Federal
Express Corporation Trust No. N582FE), dated as of April 1, 1996, as
amended and restated as of June 1, 1996, between the Lessor and the
Indenture Trustee, as supplemented by the Indenture and Security Agreement
Supplement, and as said Indenture may from time to time be further
supplemented or amended, including any amendment or supplement thereto
entered into from time to time pursuant to the applicable provisions of the
Indenture.
Indenture and Security Agreement Supplement. The Indenture and
Security Agreement Supplement No. 1 (Federal Express Corporation Trust No.
N582FE), dated April 22, 1996, as such Indenture and Security Agreement
Supplement shall be amended or supplemented from time to time and any other
supplement to the Indenture, substantially in the form of Exhibit A to the
Indenture.
Indenture Default. Any event or condition which, with the lapse of
time or the giving of notice, or both, would constitute an Indenture Event of
Default.
Indenture Documents. Has the meaning specified in the Granting
Clause of the Indenture.
Indenture Event of Default. Each of the events specified in Section
7.01 of the Indenture.
Indenture Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, not in its individual capacity but solely as
Indenture Trustee under the Indenture and each other Person which may from
time to time be acting as successor trustee under the Indenture.
Indenture Trustee's Liens. Any Lien on the Trust Indenture Estate
resulting from (i) claims against the Indenture Trustee not related to the
administration of the Trust Indenture Estate or any transactions pursuant
to the Indenture or any document included in the Trust Indenture Estate,
(ii) any act or omission of the Indenture Trustee which is not related to
the transactions contemplated by the Operative Agreements or is in
violation of any of the terms of the Operative Agreements or (iii) Taxes
imposed against the Indenture Trustee in its individual capacity against
which the Lessee has not indemnified (and is not obligated to indemnify)
the Indenture Trustee in such capacity.
Independent Appraisal. An appraisal conducted pursuant to Section
4.03 of the Lease.
Independent Investment Banker. An independent investment banking
institution of national standing appointed by the Lessee that is
independent in fact, does not have any direct financial interests, 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 Trustee shall not have received written notice of such an
appointment at least 10 days prior to the Prepayment Date, "Independent
Investment Banker" shall mean such an institution appointed by the
Indenture Trustee.
Interim Term. The period commencing on the Delivery Date and ending
at the end of the day immediately preceding the Commencement Date.
Invoice. The invoice for the Aircraft given by the Lessee to the
Lessor.
Lease. The Lease Agreement (Federal Express Corporation Trust No.
N582FE), dated as of April 1, 1996, as amended and restated as of June 1,
1996, entered into by the Lessor and the Lessee concurrently with the
execution and delivery of the Indenture, as said Lease may from time to
time be supplemented or amended, or its terms waived or modified, to the
extent permitted by, and in accordance with, the terms of the Indenture,
including, without limitation, supplementation by one or more Lease
Supplements entered into pursuant to the applicable provisions of the
Lease.
Lease Supplement. The Lease Supplement No. 1 (Federal Express
Corporation Trust No. N582FE), dated April 22, 1996, as such Lease Supplement
shall be amended or supplemented from time to time and any other supplement to
the Lease, substantially in the form of Exhibit A to the Lease.
Lease Term. The period commencing on the Delivery Date and ending
at the end of the Basic Term.
Lessee. Federal Express Corporation, a Delaware corporation, and its
successors and permitted assigns.
Lessee Documents. Has the meaning set forth in Section 6.01(b) of
the Participation Agreement.
Lessor. First Security Bank of Utah, National Association, a
national banking association, not in its individual capacity but solely as
Owner Trustee under the Trust Agreement, and its successors and permitted
assigns.
Lessor's Estate. All estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Participation Agreement, the Bills of Sale, the Modification Agreement, the
GTA, the Engine Warranty Assignment, the Engine Consent, any Ancillary
Agreement, any warranty with respect to the Airframe and the Engines, all
amounts of Basic Rent, Renewal Rent and Supplemental Rent, including
without limitation, insurance proceeds (other than insurance proceeds
payable to or for the benefit of either the Owner Trustee in its individual
capacity or the Owner Participant) and requisition, indemnity or other
payments of any kind for or with respect to the Aircraft (except amounts
owing to the Owner Participant or to the Owner Trustee in its individual
capacity, or to any of their respective directors, officers, employees and
agents pursuant to Articles 8 and 9 of the Participation Agreement).
Notwithstanding the foregoing, "Lessor's Estate" shall (i) not include any
Excepted Payment and (ii) "Lessor's Estate" shall include all property
intended to be subjected to the Indenture by the Granting Clause thereof.
Lessor's Liens. Liens on the Lessor's Estate or the Trust
Indenture Estate arising as a result of (i) claims against the Lessor, in
its individual capacity or as Owner Trustee, the Owner Participant or any
Affiliate of the Owner Participant, in each case not related to the
transactions contemplated by the Operative Agreements, (ii) acts or
omissions of the Lessor in its individual capacity or as Owner Trustee,
and, in the case of the Lessor in its individual capacity, arising from its
gross negligence or willful misconduct either not related to the
transactions contemplated by or expressly prohibited under the Operative
Agreements and any act or omission of the Owner Participant or any
Affiliate of the Owner Participant which is not related to the transactions
contemplated by the Operative Agreements or is in violation of any of the
terms of the Operative Agreements, (iii) Taxes or Expenses imposed against
the Lessor, in its individual capacity or as Owner Trustee, or the Owner
Participant or any Affiliate of the Owner Participant, the Lessor's Estate
or the trust created by the Trust Agreement which are not required to be
indemnified against by the Lessee pursuant to the Tax Indemnity Agreement
or by reason of Section 8.01(b) or 9.01(b) of the Participation Agreement,
or (iv) claims against the Lessor or the Owner Participant arising from the
voluntary transfer by the Lessor or the Owner Participant of its interests
in the Aircraft other than a transfer of the Aircraft pursuant to Section
4.02(a) or Article 10 or 11 of the Lease and other than a transfer pursuant
to the exercise of the remedies set forth in Article 17 of the Lease.
Lien. Any mortgage, pledge, lien, charge, encumbrance, lease or
security interest or other similar interest.
Loss Payee. Has the meaning specified in Section 13.02(b)(i) of the
Lease.
Majority in Interest of Certificate Holders. As of a particular
date of determination, the Holders of more than 50% of the aggregate unpaid
principal amount of all Certificates outstanding as of such date excluding
for purposes of this definition any Certificates held by (i) the Owner
Trustee or the Owner Participant or any interests of the Owner Participant
unless all Certificates then outstanding shall be held by the Owner
Participant, (ii) the Lessee or (iii) any Affiliate of any thereof.
Make-Whole Premium. An amount determined as of the day before the
applicable Prepayment Date (or date of purchase, as the case may be) which
an Independent Investment Banker determines to be equal to the excess, if
any, of (i) the present values of all remaining scheduled payments of such
principal amount or portion thereof and interest thereon (excluding
interest accrued from the immediately preceding Payment Date to such
Prepayment Date or date of purchase, as the case may be) to the Maturity of
such Certificate in accordance with generally accepted financial practices
assuming a 360-day year consisting of twelve 30-day months at a discount
rate equal to the Treasury Yield, all as determined by the Independent
Investment Banker over (ii) the unpaid principal amount of such
Certificate.
Manufacturer. McDonnell Douglas Corporation, a Maryland
corporation, and its successors and assigns.
Maturity. With respect to any Certificate, the date on which the
final principal amount of such Certificate is scheduled to be due and payable.
Modification Agreement. The Aircraft Modification Agreement dated
as of December 1, 1995 between the Lessee and the Manufacturer providing
for the refurbishing and reconfiguration of the Aircraft including any
warranties relating thereto, as originally executed or as modified,
supplemented, amended or supplemented in accordance with the terms thereof,
but only to the extent that the foregoing relates to the Aircraft, to the
extent assigned to the Owner Trustee pursuant to the Warranty Bill of Sale.
Moody's. Moody's Investors Service, Inc.
Net Present Value of Rents. The net present value, as of the
Delivery Date, of Basic Rent set forth in Schedule II of the Lease,
discounted at a rate per semi-annual period equal to the Debt Rate.
Non-U.S. Person. Any Person other than (i) a citizen or resident
of the United States, as defined in Section 7701(a)(30) of the Code, (ii) a
corporation, partnership or other entity created or organized in or under
the laws of the United States or any political subdivision thereof or
therein, or (iii) any estate or trust that is subject to United States
federal income taxation regardless of the source of its income.
Obsolete Parts. Parts which the Lessee in good faith determines
to be obsolete or no longer suitable or appropriate for use on the Airframe
or any Engine.
Officer's Certificate. When delivered pursuant to the Indenture,
a certificate signed by a Responsible Officer of the Lessee or the Owner
Trustee, as the case may be, and delivered to the Indenture Trustee. Each
such certificate shall include the statements provided for in Section 15.07
of the Indenture.
Operative Agreements. The Participation Agreement, the Trust
Agreement, the Bills of Sale, the Modification Agreement, the GTA, the
Engine Warranty Assignment, the Lease, the Lease Supplement, the Owner
Participant Guaranty, the Owner Trustee Guaranty, if any, any Ancillary
Agreement entered into by or with the written consent of the Indenture
Trustee, which by its terms is an Operative Agreement, the Certificates
outstanding at the time of reference, the Indenture, the Indenture and
Security Agreement Supplement, the Engine Consent and the Tax Indemnity
Agreement, each as amended from time to time.
Opinion of Counsel. When delivered pursuant to the Indenture, 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) Davis Polk & Wardwell 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 or the Indenture Trustee, an attorney selected by such Person and,
in the case of the Owner Trustee, reasonably satisfactory to the Indenture
Trustee.
Original Agreements. The documents and instruments delivered on
the Delivery Date in connection with the transactions contemplated by the
Original Participation Agreement.
Original Ancillary Agreement I. The Ancillary Agreement I (Federal
Express Corporation Trust No. N582FE), among the Lessee, the Owner
Participant, the Indenture Trustee and the Owner Trustee as it was originally
executed on the Delivery Date.
Original Indenture. The Trust Indenture, Mortgage and Security
Agreement (Federal Express Corporation Trust No. N582FE), dated as of
April 1, 1996, between the Owner Trustee and the Indenture Trustee, which
together with the Indenture and Security Agreement Supplement No. 1
(Federal Express Corporation Trust No. N582FE), dated April 22, 1996
attached thereto was recorded as one instrument by the FAA on April 23,
1996 and assigned Conveyance Number P06442.
Original Lease. The Lease Agreement (Federal Express Corporation
Trust No. N582FE), dated as of April 1, 1996, between the Owner Trustee as
lessor, and the Lessee, which together with Lease Supplement No. 1 (Federal
Express Corporation Trust No. N582FE), dated April 22, 1996 attached thereto
was recorded as one instrument by the FAA on April 23, 1996 and assigned
Conveyance Number P06443.
Original Loan Certificates. The loan certificates issued on the
Delivery Date to the Original Loan Participants.
Original Loan Participants. The entities listed on Schedule I to
the Original Participation Agreement and their successors and assigns
(other than any assignees in connection with the Refunding Date).
Original Participation Agreement. The Participation Agreement
(Federal Express Corporation Trust No. N582FE), among the Lessee, the Owner
Participant, the Indenture Trustee, the Owner Trustee and the Original Loan
Participants as it was originally executed as of April 1, 1996.
Original Tax Indemnity Agreement. The Tax Indemnity Agreement
(Federal Express Corporation Trust No. N582FE), between the Lessee and the
Owner Participant as it was originally executed as of April 1, 1996.
Original Trust Agreement. The Trust Agreement (Federal Express
Corporation Trust No. N582FE), between the Owner Participant and the Owner
Trustee as it was originally executed as of April 1, 1996 and filed with the
FAA on April 22, 1996.
Outstanding. When used with respect to Certificates, as of the date
of determination and subject to the provisions of Section 10.04 of the
Indenture, all Certificates theretofore executed and delivered under the
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 the Indenture or otherwise;
(ii) Certificates for which prepayment 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 of the Indenture; provided, that if such Certificates are to
be prepaid, notice of such prepayment has been duly given pursuant
to the 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 and delivered pursuant to Article
II of the Indenture.
Owner Participant. The trustor originally named in the Trust
Agreement and any successor thereto, and any Person to which Owner
Participant transfers, in accordance with the Trust Agreement, its right,
title and interest in and to the Operative Agreements and the Lessor's
Estate.
Owner Participant Guarantor. The Boatmen's National Bank of St.
Louis, a national banking association, its successors and permitted assigns
and any other provider of an Owner Participant Guaranty.
Owner Participant Guaranty. The Owner Participant Guaranty dated
the Delivery Date, as amended and restated as of the Refunding Date by the
Owner Participant Guarantor in favor of the Lessee, the Owner Trustee, the
Indenture Trustee and the Pass Through Trustee and any other guaranty
delivered in compliance with Article 5 of the Trust Agreement.
Owner Trustee. FSBU, not in its individual capacity except as
otherwise expressly stated, but solely as Owner Trustee under the Trust
Agreement, and its successors and permitted assigns.
Owner Trustee Guarantor. The provider of an Owner Trustee Guaranty.
Owner Trustee Guaranty. Any guaranty delivered in compliance with
Section 11.01(b)(ii) of the Participation Agreement.
Owner's Economic Return. The Owner Participant's anticipated net
after-tax yield and aggregate after-tax cash flow during the Interim Term
and the Basic Term, utilizing the multiple investment sinking fund method
of analysis, computed on the basis of the same methodology and assumptions
as were utilized by the Owner Participant in determining Basic Rent,
Stipulated Loss Value and Termination Value percentages and FPO Price, as
such assumptions may be adjusted for events which have been the basis of
adjustments to Rent pursuant to Section 3.04 of the Lease.
Participation Agreement. The Participation Agreement (Federal
Express Corporation Trust No. N582FE), dated as of April 1, 1996, as
amended and restated as of June 1, 1996, among the Lessee, the Original
Loan Participants, the Owner Trustee not in its individual capacity except
as otherwise expressly provided therein, but solely as owner trustee, the
Owner Participant, the Indenture Trustee not in its individual capacity
except as otherwise expressly provided therein, but solely as indenture
trustee and the Pass Through Trustee not in its individual capacity except
as otherwise expressly provided therein, but solely as pass through
trustee, as amended, modified or supplemented, or the terms thereof waived.
Parts. All appliances, parts, components, instruments,
appurtenances, accessories, furnishings and other equipment of whatever
nature (other than complete Engines or engines) which may from time to time
be incorporated or installed in or attached to the Airframe or any Engine
or, prior to replacement thereof in accordance with the Lease, which may be
removed therefrom.
Pass Through Agreement. The Pass Through Trust Agreement dated as
of February 1, 1993, as amended and restated as of October 1, 1995 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 Certificates. Any of the 1996 Pass Through
Certificates, Series A1 or 1996 Pass Through Certificates, Series A2, in
each case as issued by the related Pass Through Trust; and "Pass Through
Certificates" means both of the Pass Through Certificates issued by each of
the Pass Through Trusts.
Pass Through Closing Date. The Business Day on which the sale of
the Pass Through Certificates to the Underwriters pursuant to the
Underwriting Agreement takes place.
Pass Through Trust. The Federal Express Pass Through Trust,
1996-A1 or Federal Express Pass Through Trust, 1996-A2, in each case formed
pursuant to the related Series Supplement in accordance with the Pass
Through Agreement; and "Pass Through Trusts" means both of such Pass
Through Trusts.
Pass Through Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, in its capacity as Pass Through Trustee under
the Pass Through Agreement and each Pass Through Trust, and its successors
and permitted assigns as Pass Through Trustee thereunder.
Past Due Rate. In respect of (A) any amount payable to the Owner
Participant or the Owner Trustee a rate per annum during the period from
and including the due date to but excluding the date on which such amount
is paid in full equal to 2% plus the Debt Rate and (B) any principal of or
interest on any Certificate or any other amount payable under the
Indenture, any Certificate or any other Operative Agreement that is not
paid when due (whether at Maturity, by acceleration, by optional or
mandatory prepayment or otherwise) to any Holder, the Indenture Trustee or
the Pass Through Trustee, a rate per annum during the period from and
including the due date to but excluding the date on which such amount is
paid in full equal to (i) in the case of any such amount payable to the
Holder of any Certificate, 2% plus the interest rate applicable to such
Certificate and (ii) in the case of any other such amount, 2% plus the Debt
Rate.
Payment Date. Each January 30 and July 30 commencing on July 30,
1996.
Payment Default. Any event specified in Section 16.01(a) or
16.01(b) of the Lease which with the giving of notice or lapse of time or
both would constitute an Event of Default.
Permitted Investments. Those investments enumerated in Section
23.01(a) (i), (ii), (iii) and (iv) of the Lease.
Person. Any individual, sole proprietorship, partnership, joint
venture, joint stock company, trust, unincorporated organization,
association, corporation, institution, entity or government (federal,
state, local, foreign or any agency, instrumentality, division or body
thereof).
Preliminary Notice. Has the meaning specified in Section 4.01(a) of
the Lease.
Premium Termination Date. With respect to the Certificates having a
Maturity in 2015, June 11, 2008 and with respect to the Certificates
having a Maturity in 2016, November 24, 2016.
Prepayment Date. Has the meaning specified in Section 6.02(b) of the
Indenture.
Prepayment Price. Has the meaning specified in Section 6.02(b) of
the Indenture.
Property. Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or
intangible.
Proposed Termination Date. Has the meaning specified in Section
10.01(a) of the Lease.
Purchase Price. The amount specified as such in Ancillary Agreement
I.
Record Date. With respect to Payment Dates under the Indenture
(except a date for payment of defaulted interest), January 15 for January 30
Payment Dates and July 15 for July 30 Payment Dates, whether or not such date
is a Business Day.
Recourse Amount. Has the meaning specified in Section 17.10 of the
Participation Agreement.
Refinancing. A non-recourse loan to the Lessor arranged pursuant to
Section 15.01 of the Participation Agreement.
Refunding Date. A Business Day on which the refunding of the
Original Loan Certificates occurs, the expected date thereof having been
specified by the Lessee in a written notice given to the parties to the
Participation Agreement and the Underwriters at least three (3) Business Days
prior to such expected Refunding Date.
Register. Has the meaning set forth in Section 3.02 of the
Indenture.
Registrar. Has the meaning set forth in Section 3.02 of the
Indenture.
Remaining Weighted Average Life. 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 payment is scheduled to
be made, by (b) the then outstanding principal amount of such Certificate.
Renewal Rent. The amount payable by the Lessee as rent in accordance
with Section 4.01 of the Lease during any Renewal Term.
Renewal Term. Any Fixed Renewal Term or Fair Market Renewal Term
with respect to which the Lessee has exercised its option to renew the
Lease pursuant to Section 4.01(a) thereof.
Rent. All payments due from the Lessee under the Lease as Basic
Rent, Renewal Rent and Supplemental Rent, collectively.
Rent Payment Date. Each January 30 and July 30 commencing on July
30, 1996, and continuing thereafter during the Term.
Reoptimization Date. Has the meaning specified in Section 15.02(a)
of the Participation Agreement.
Replacement Aircraft. Any aircraft substituted for the Aircraft
pursuant to Section 11.03(a) of the Lease.
Replacement Airframe. Has the meaning set forth in Section 11.03 of
the Lease.
Replacement Engine. A General Electric CF6-80C2-D1F engine (or an
engine of the same or another manufacturer) of equal or greater value,
remaining useful life and utility as the Engine being replaced, together
with all Parts relating to such engine; provided, however, that if such
replacement engine is not a General Electric CF6-80C2-D1F engine, such
replacement engine must then be commonly used in the commercial aviation
industry on McDonnell Douglas MD-11 airframes.
Responsible Officer. With respect to the Owner Trustee (except for
purposes of the Trust Agreement in which case the definition of Responsible
Officer set forth in Section 3.10 of the Trust Agreement is applicable) or the
Indenture Trustee, any officer in its Corporate Trust Administration, as the
case may be, designated by such Person to perform obligations under the
Operative Agreements, and with respect to any other party, any corporate
officer or (except in the case of the Owner Participant) other employee of a
party who, in the normal performance of his or her operational
responsibilities, with respect to the subject matter of any covenant,
agreement or obligation of such party pursuant to any Operative Agreement,
would have responsibility for and knowledge of such matter and the
requirements of any Operative Agreement with respect thereto.
S&P. Standard & Poor's Ratings Group.
SEC. The Securities and Exchange Commission of the United States
and any successor agencies or authorities.
SSB. State Street Bank and Trust Company, a Massachusetts trust
company.
Securities Act. The Securities Act of 1933, as amended.
Series Supplement. The Series Supplement 1996-A1 to be executed
and delivered by the Lessee and the Pass Through Trustee or the Series
Supplement 1996-A2 to be executed and delivered by the Lessee and the Pass
Through Trustee, in each case as such Series Supplement may be modified,
supplemented or amended from time to time in accordance with the provisions
thereof and "Series Supplements" means both such Series Supplements.
Sinking Fund Redemption Date. Has the meaning specified in Section
6.06 of the Indenture.
Sinking Fund Redemption Price. Has the meaning specified in Section
6.06 of the Indenture.
Special Aviation Counsel. Daugherty, Fowler & Peregrin.
Stipulated Loss Value. As of any Stipulated Loss Value
Determination Date during the Basic Term, the amount determined by
multiplying the Purchase Price by the percentage set forth in Schedule III
of the Lease under the heading "Stipulated Loss Value Factor" opposite such
date (as such Schedule III may be adjusted from time to time as provided in
Section 3.04 of the Lease), and during any Renewal Term, the amount
determined pursuant to Section 4.01(b) of the Lease. Notwithstanding any
other provisions of the Lease or the Participation Agreement or the
Indenture, each Stipulated Loss Value for the Aircraft shall be, under any
circumstances and in any event, an amount, together with so much of the
arrears portion of Basic Rent due and owing through the date of payment of
Stipulated Loss Value as does not constitute an Excepted Payment, at least
sufficient to pay in full as of such date of payment the aggregate unpaid
principal amount of and accrued interest on the Certificates outstanding on
such date of payment. Subject to the immediately preceding sentence, it is
understood and agreed that the amounts set forth on Schedule III of the
Lease, for dates other than Rent Payment Dates on which arrears Basic Rent
is due, fully reflect appropriate Basic Rent accruals and credits of
unearned Basic Rent and, accordingly, no further accrual or credit shall be
required whenever Stipulated Loss Value is to be calculated with reference
to any such date.
Stipulated Loss Value Determination Date. Each date set forth on
Schedule III of the Lease under the heading "Stipulated Loss Value
Factors."
Supplemental Rent. All amounts, liabilities and obligations which
the Lessee assumes or agrees to perform or pay under the Lease or under the
Participation Agreement or Tax Indemnity Agreement or any Ancillary
Agreement or any other Operative Agreement to FSBU, the Lessor, the Owner
Participant, the Indenture Trustee or others, including, without
limitation, payments of Stipulated Loss Value, FPO Price and amounts
calculated by reference to Termination Value, and all amounts required to
be paid by Lessee under the agreements, covenants and indemnities contained
in the Lease or in the Participation Agreement or the Tax Indemnity
Agreement or any other Operative Agreement, but excluding Basic Rent.
Tax. Has the meaning set forth in Section 8.01(a) of the
Participation Agreement.
Tax Indemnity Agreement. The Original Tax Indemnity Agreement as
amended by Amendment No. 1 to the Original Tax Indemnity Agreement, as from
time to time modified, amended or supplemented pursuant to its applicable
provisions.
Term. The Interim Term, the Basic Term and any Renewal Term unless
the Lease is terminated earlier pursuant to its terms.
Termination Date. A Rent Payment Date during the Basic Term that
is on or after the fifth anniversary of the Commencement Date in the case
of Article 10 of the Lease, and in the case of (i) Section 4.02(a)(A) of
the Lease, the Rent Payment Date falling on the 12th anniversary of the
Commencement Date or the 16th anniversary of the Commencement Date, as the
case may be, (ii) Section 4.02(a)(D) or (E) of the Lease, a Rent Payment
Date that is on or after the fifth anniversary of the Commencement Date and
(iii) Section 4.02(a)(F) of the Lease, the last day of the Basic Term.
Termination Value. As of any Termination Date, the amount
determined by multiplying the Purchase Price by the percentage set forth in
Schedule IV of the Lease under the heading "Termination Value Factor"
opposite such Termination Date (as such Schedule IV may be adjusted from
time to time as provided in Section 3.04 of the Lease). Notwithstanding
any other provisions of the Lease, the Participation Agreement or the
Indenture, each Termination Value shall be, under any circumstances and in
any event, an amount, together with so much of the arrears portion of Basic
Rent due and owing through the date of payment of any amount calculated by
reference to Termination Value as does not constitute an Excepted Payment,
at least sufficient to pay in full as of such date of payment the aggregate
unpaid principal amount of and accrued interest on the Certificates
outstanding on such date of payment. Subject to the immediately preceding
sentence, it is understood and agreed that the amounts set forth on
Schedule IV of the Lease, for dates other than Rent Payment Dates on which
arrears Basic Rent is due, fully reflect appropriate Basic Rent accruals
and credits of unearned Basic Rent and, accordingly, no further accrual or
credit shall be required whenever Termination Value is to be calculated
with reference to any such date.
Transaction Costs. Those costs and expenses set forth in Section
10.01(a) of the Participation Agreement.
Transportation Code. Title 49 of the United States Code, as
amended and in effect on the date of the Lease or as subsequently amended,
or any successor or substituted legislation at the time in effect and
applicable, and the regulations promulgated pursuant thereto.
Treasury Yield. (i) In the case of a Certificate having a
Maturity within one year after the Prepayment 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
Prepayment 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 source deemed comparable by the Independent
Investment Banker selected to determine the Make-Whole Premium and
reasonably acceptable to the Lessee) corresponding in maturity to the
Remaining Weighted Average Life of such Certificate (or, if there is no
corresponding maturity, an interpolation of maturities by the Independent
Investment Banker), in each case determined by the Independent Investment
Banker selected to determine the Make-Whole Premium based on the average of
the yields to stated maturity determined from the bid prices as of 10:00
a.m. and 2:00 p.m. New York time, on the second Business Day preceding the
Prepayment Date.
Trust Agreement. The Trust Agreement (Federal Express Corporation
Trust No. N582FE), dated as of April 1, 1996, as amended and restated as of
June 1, 1996, between the Owner Participant and the Owner Trustee in its
individual capacity, as from time to time modified, amended or supplemented
pursuant to its applicable provisions and in accordance with the Operative
Agreements.
Trust Estate. The Lessor's Estate.
Trust Indenture Act. The Trust Indenture Act of 1939, as amended.
Trust Indenture Estate. All estate, right, title and interest of
the Indenture Trustee in and to any of the property, rights, interests and
privileges granted to the Indenture Trustee pursuant to the Granting Clause
of the Indenture, other than Excepted Payments and any and all other rights
of the Owner Trustee or the Owner Participant expressly reserved to the
Owner Trustee or the Owner Participant pursuant to the Indenture.
Underwriters. Goldman, Sachs & Co., J.P. Morgan Securities Inc. and
Morgan Stanley & Co. Incorporated.
Underwriting Agreement. The Underwriting Agreement dated June 5,
1996 among the Lessee and the Underwriters.
United States, U.S. or US. The United States of America.
U.S. Air Carrier. Any United States air carrier as to which
there is in force a certificate issued pursuant to Section 41102(a) or
Section 41103 of the Transportation Code, and as to which there is in force
an air carrier operating certificate issued pursuant to Chapter 447 of the
Transportation Code and Part 121 of the regulations under such
Transportation Code, for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, or which may operate as an
air carrier by certification or otherwise under any successor or substitute
provision thereof or in absence thereof.
U.S. Person. A Person described in Section 7701(a)(30) of the Code.
Warranty Bill of Sale. The full warranty bill of sale covering
the Aircraft (and specifically referring to each Engine) executed by the
Lessee, as seller in favor of the Owner Trustee, as buyer, and dated the
Delivery Date.
TRUST AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N668FE)
Dated as of May 1, 1996
Amended and Restated as of June 1, 1996
between
PMCC LEASING CORPORATION,
Trustor
and
FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION,
Owner Trustee
COVERING ONE AIRBUS A300F4-605R AIRCRAFT
SERIAL NO. 772, REGISTRATION NO. N668FE
TABLE OF CONTENTS
PARTIES................................................................. 1
RECITALS................................................................ 1
ARTICLE 1
THE LESSOR'S ESTATE
Section 1.01. Authorization and Direction to Owner Trustee.......... 2
Section 1.02. Declaration of Trust.................................. 2
Section 1.03. Conditions Precedent.................................. 2
ARTICLE 2
DISTRIBUTIONS
Section 2.01. Rent, Etc............................................. 3
Section 2.02. Excepted Payments..................................... 3
Section 2.03. Other Receipts........................................ 4
Section 2.04. Distributions after Default........................... 4
Section 2.05. Distributions after Release of Lien of Indenture...... 4
Section 2.06. Manner of Making Distributions........................ 5
ARTICLE 3
THE OWNER TRUSTEE
Section 3.01. Acceptance of Trust and Duties........................ 5
Section 3.02. Limitation on Authority of Owner Trustee.............. 6
Section 3.03. Notice of Default..................................... 6
Section 3.04. Action Upon Instructions.............................. 6
Section 3.05. Certain Duties and Responsibilities
of Owner Trustee.................................... 7
Section 3.06. Certain Rights of Owner Trustee....................... 8
Section 3.07. No Representations or Warranties
as to Certain Matters............................... 10
Section 3.08. Status of Moneys Received............................ 10
Section 3.09. Self-Dealing......................................... 11
Section 3.10. Definition of a Responsible Officer.................. 11
Section 3.11. Resignation or Removal of Owner Trustee.............. 11
Section 3.12. Estate and Rights of Successor Owner Trustee......... 11
Section 3.13. Merger or Consolidation of FSBU...................... 12
Section 3.14. Co-Trustees.......................................... 12
Section 3.15. Interpretation of Agreements......................... 13
Section 3.16. Not Acting in Individual Capacity.................... 14
Section 3.17. Tax Returns.......................................... 14
ARTICLE 4
TERMINATION OF TRUST
Section 4.01. Termination.......................................... 14
Section 4.02. Termination at Option of the Trustor................. 15
Section 4.03. Distribution of Lessor's Estate upon Termination..... 15
ARTICLE 5
[INTENTIONALLY LEFT BLANK]
ARTICLE 6
MISCELLANEOUS
Section 6.01. Indemnification...................................... 16
Section 6.02. Supplements and Amendments........................... 17
Section 6.03. Nature of Title of Trustor........................... 18
Section 6.04. Power of Owner Trustee to Convey..................... 18
Section 6.05. Notices.............................................. 18
Section 6.06. Situs of Trust; Applicable Law; Severability......... 19
Section 6.07. Successors and Assigns............................... 19
Section 6.08. Headings and Table of Contents....................... 19
Section 6.09. Identification of Trust.............................. 19
Section 6.10. Counterparts......................................... 19
Section 6.11. Trustor Interest..................................... 19
Section 6.12. Performance by the Trustor........................... 20
Schedule I Definitions
TRUST AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N668FE)
TRUST AGREEMENT (FEDERAL EXPRESS CORPORATION TRUST NO. N668FE)
dated as of May 1, 1996 (the "Original Trust Agreement"), as amended and
restated as of June 1, 1996 (this "Agreement") between FIRST SECURITY BANK
OF UTAH, NATIONAL ASSOCIATION, a national banking association (in its
individual capacity, "FSBU", and not in its individual capacity but solely
as trustee hereunder, the "Owner Trustee"), and PMCC LEASING CORPORATION, a
Delaware corporation (together with its successors and permitted assigns,
the "Trustor"). The capitalized terms used herein, unless otherwise herein
defined or the context hereof shall otherwise require, shall have the
respective meanings set forth in Schedule I attached hereto.
W I T N E S S E T H :
WHEREAS, the Trustor and FSBU have heretofore entered into the
Original Trust Agreement;
WHEREAS, the Original Trust Agreement was duly filed with the Federal
Aviation Administration on May 24, 1996;
WHEREAS, the Original Loan Participants participated in the payment
of the Purchase Price by providing financing as evidenced by the Original Loan
Certificates;
WHEREAS, pursuant to Article 15 of the Original Participation
Agreement, the Lessee, the Trustor and the Owner Trustee desire to refinance
all of the Original Loan Certificates on the Refunding Date; and
WHEREAS, the Trustor and the Owner Trustee desire, in connection with
such refinancing, to amend and restate the Original Trust Agreement in its
entirety as herein provided.
NOW THEREFORE, in consideration of the mutual covenants and
agreements contained herein, FSBU and the Trustor agree that the Original
Trust Agreement be and the same is hereby amended and restated in its
entirety as follows:
ARTICLE 1
THE LESSOR'S ESTATE
Section 1.01. Authorization and Direction to Owner Trustee. The
Trustor hereby authorizes and directs (or has authorized and directed) the
Owner Trustee, not individually but solely as the Owner Trustee hereunder:
(a) to execute and deliver each of the other Operative Agreements
to which the Owner Trustee is a party and to enter into and perform the
transactions contemplated thereby;
(b) to execute and deliver from time to time the Certificates in
the manner and subject to the terms and conditions provided in the
Participation Agreement and the Indenture;
(c) to execute and deliver each other document referred to in the
Operative Agreements and the Original Agreements to which the Owner
Trustee is a party or which the Owner Trustee is required to deliver
pursuant to the Operative Agreements and the Original Agreements;
(d) subject to the terms of this Agreement, to perform the
obligations and duties and, upon instruction of the Trustor, exercise the
rights of the Owner Trustee under the Operative Agreements; and
(e) to execute and deliver all such other instruments, documents or
certificates and take all such other actions in accordance with the
directions of the Trustor, as the Trustor may deem necessary or advisable
in connection with the transactions contemplated hereby, the taking of any
such action by the Owner Trustee in the presence of the Trustor or its
counsel to evidence, conclusively, the direction of the Trustor.
Section 1.02. Declaration of Trust. FSBU hereby confirms, in its
individual capacity, that it holds and will continue to hold, in its
capacity as the Owner Trustee, the Lessor's Estate upon the trusts herein
set forth for the use and benefit of the Trustor, subject, however, to the
provisions of, and the Lien created by, the Indenture.
Section 1.03. Conditions Precedent. The right and obligation of
the Owner Trustee to take the actions required by Section 1.01 hereof shall
be subject to the condition that the terms and conditions of Section 4.01
of the Participation Agreement shall have been complied with in a manner
satisfactory to the Owner Trustee and the Trustor.
ARTICLE 2
DISTRIBUTIONS
Section 2.01. Rent, Etc. The Trustor and the Owner Trustee
acknowledge that the Lease will be security for the Certificates pursuant
to the Indenture which provides that all moneys payable by the Lessee to
the Owner Trustee under the Lease (other than Excepted Payments) are to be
first paid to the Indenture Trustee while the Lien of the Indenture is in
effect, for distribution in accordance with the terms of Article V of the
Indenture. Except as otherwise provided in Section 2.04 hereof (and except
for amounts received from the Indenture Trustee, which shall be applicable
only in accordance with clause (c) below), the Owner Trustee shall promptly
apply each payment of the Owner Participant Amount, Rent (other than
Excepted Payments), Stipulated Loss Value, Termination Value, and any
proceeds from the sale, requisition or disposition of the Aircraft received
by it as follows:
(a) prior to the release of the Lien of the Indenture, each such
payment shall be payable directly to the Indenture Trustee (and if any
of the same are received by the Owner Trustee shall, upon receipt, be
paid over to the Indenture Trustee without deduction, set off or
adjustment of any kind) for distribution in accordance with the
provisions of Article V of the Indenture; provided, that any payments
received by the Owner Trustee from (i) the Lessee with respect to FSBU's
or the Owner Trustee's fees and disbursements under this Agreement, or
(ii) the Trustor pursuant to Section 6.01 hereof shall not be paid over
to the Indenture Trustee but shall be retained by the Owner Trustee and
applied toward the purpose for which such payments were made;
(b) after the release of the Lien of the Indenture, any amount
remaining after application in full in accordance with paragraph (a) of
this Section 2.01 and which represents payments for which provision as
to the application thereof is made in any other Operative Agreement
shall be applied promptly to the purpose for which such payment shall
have been made in accordance with the terms of such Operative Agreement;
and
(c) after application in accordance with paragraphs (a) and (b) of
this Section 2.01, or to the extent received from the Indenture Trustee
under the terms of the Indenture, the balance, if any, remaining shall be
paid to the Trustor.
Section 2.02. Excepted Payments. Notwithstanding any other
provision contained herein, all Excepted Payments at any time received by
the Owner Trustee shall be distributed promptly to the applicable Person
entitled thereto, and such payment shall not be deemed under any
circumstances to be part of the Lessor's Estate.
Section 2.03. Other Receipts. Except as otherwise provided in
Section 2.04 hereof, any payment received by the Owner Trustee, other than
those referred to in Sections 2.01 and 2.02 hereof, shall be payable prior
to the release of the Lien of the Indenture directly to the Indenture
Trustee (and if any of the same are received by the Owner Trustee shall,
upon receipt, be paid over to the Indenture Trustee without deduction, set
off or adjustment of any kind) for distribution in accordance with the
provisions of Article V of the Indenture; and following such application or
release of Lien, any such payment for which provision as to the application
thereof is made in the other Operative Agreements shall be applied promptly
to the purpose for which such payment shall have been made in accordance
with the terms of the other Operative Agreements, and any such payment
received by the Owner Trustee for which no provision as to the application
thereof is made in the Operative Agreements or in this Article 2 shall,
unless the Trustor shall have otherwise instructed the Owner Trustee in
writing, be distributed promptly to the Trustor.
Section 2.04. Distributions after Default. Subject to the
provisions of Section 2.02 hereof, (i) all payments received and amounts
realized by the Owner Trustee after an Indenture Event of Default shall
have occurred and shall be continuing and after the Certificates shall have
become or been declared due and payable pursuant to Section 7.02(b) or
7.02(c) of the Indenture (including, without limitation, any amounts
realized by the Owner Trustee or the Trustor from the exercise of any
remedies pursuant to Section 17.01 of the Lease), as well as (ii) all funds
then held or thereafter received by the Owner Trustee as part of this Trust
Agreement, the Lease or otherwise, shall be distributed to the Indenture
Trustee for distribution in accordance with the provisions of Article V of
the Indenture.
Section 2.05. Distributions after Release of Lien of Indenture.
Except as otherwise provided in Sections 2.01, 2.02, 2.03 and 2.04 hereof:
(a) all payments received and amounts realized by the Owner
Trustee under the Lease or otherwise with respect to the Aircraft or
any part thereof (including, without limitation, all payments
received pursuant to Section 17.01 of the Lease and amounts realized
upon the sale or lease of the Aircraft or any part thereof after the
termination of the Lease with respect thereto), to the extent
received or realized at any time after the Lien of the Indenture
shall have been released pursuant to the terms of the Indenture, and
(b) moneys not included in paragraph (a) of this Section 2.05
remaining as part of the Lessor's Estate after the Lien of the
Indenture has been released,
shall, to the extent required, be retained by the Owner Trustee as
reimbursement for all expenses hereunder or under the Lease not theretofore
reimbursed under this Agreement, the Lease or otherwise and to which the Owner
Trustee is entitled to be reimbursed pursuant to the provisions thereof, and
any balance remaining thereafter shall be distributed to the Trustor.
Section 2.06. Manner of Making Distributions. The Owner Trustee
shall make distributions or cause distributions to be made to (i) the
Trustor pursuant to this Article 2 by transferring by wire transfer in
immediately available funds the amount to be distributed to the account set
forth in the Participation Agreement or to such other account or accounts
of the Trustor as it may designate from time to time by written notice to
the Owner Trustee (and the Owner Trustee shall use best efforts to cause
such funds to be transferred by wire transfer on the same day as received,
but in any case not later than the next succeeding Business Day), and (ii)
the Indenture Trustee pursuant to this Article 2 by paying the amount to be
distributed to the Indenture Trustee in the manner specified in the
Indenture; provided, that the Owner Trustee shall invest overnight, for the
benefit of the Trustor, in investments that would be permitted by Article
23 of the Lease (but only to the extent funds are received on or prior to
2:00 P.M. (Eastern Time) and such investments are available and, if such
investments are not available to the Owner Trustee in investments which,
after consultation with the Trustor, the Trustor shall direct) all funds
not transferred by wire transfer on the same day as they were received.
Notwithstanding the foregoing but subject always to the provisions of, and
the Lien created by, the Indenture, the Owner Trustee will, if so requested
by the Trustor by written notice, pay in immediately available funds any
and all amounts payable by the Owner Trustee hereunder to the Trustor as
directed by the Trustor.
ARTICLE 3
THE OWNER TRUSTEE
Section 3.01. Acceptance of Trust and Duties. FSBU accepts the
trust hereby created and, subject to Section 1.03 hereof, in its capacity
as the Owner Trustee agrees to perform the same, including without
limitation, subject to Section 1.03 hereof, the actions specified in
Section 1.01 hereof as herein provided. The Owner Trustee agrees to
disburse all monies that it receives under the Operative Agreements in
accordance with the terms hereof. The Owner Trustee shall not be
answerable or accountable in its individual capacity except as a result of
or arising from (a) the Owner Trustee's willful misconduct or gross
negligence (in its individual capacity or as trustee), (b) any breach by
the Owner Trustee of its representations, warranties and covenants given in
its individual capacity in this Agreement, Article 5 of the Lease, Sections
7.02(a) and (b) and 7.04 of the Participation Agreement or its
representations, warranties and covenants given in its individual capacity
in Sections 3.05 and 3.08 of the Indenture, (c) the failure to use ordinary
care in receiving, handling and disbursing funds, (d) Lessor's Liens
attributable to it in its individual capacity, and (e) taxes, fees, or
other charges on, based on, or measured by, any fees, commissions or
compensation received by FSBU or the Owner Trustee in connection with the
transactions contemplated by the Lease, the Indenture and the Operative
Agreements including this Agreement.
Section 3.02. Limitation on Authority of Owner Trustee. The
Owner Trustee shall have no power, right, duty or authority to, and agrees
that it will not, manage, control, possess, use, sell, lease, dispose of or
otherwise deal with the Aircraft, Airframe, Engines, any Part thereof or
any other property at any time constituting a part of the Lessor's Estate,
or otherwise to take or refrain from taking any action under or in
connection with the Operative Agreements, except (i) to execute and deliver
the Operative Agreements to which it is a party, (ii) to exercise and carry
out or cause to be exercised or carried out the rights, duties and
obligations of the Owner Trustee hereunder and under the other Operative
Agreements, or (iii) as expressly provided in written instructions from the
Trustor given pursuant to Section 3.03 or 3.04 hereof; provided, that
nothing in this Section 3.02 shall limit in any manner the obligations of
the Owner Trustee hereunder.
Section 3.03. Notice of Default. In the event that a Responsible
Officer in the Corporate Trust Department of the Owner Trustee shall have
actual knowledge of a Default or an Event of Default, or an Indenture
Default or an Indenture Event of Default, the Owner Trustee shall give or
cause to be given to the Trustor and the Indenture Trustee prompt telephone
or facsimile notice, followed by prompt confirmation thereof by certified
mail, postage prepaid (in any event within two Business Days of the
discovery thereof), in accordance with Article 14 of the Participation
Agreement, of such Default, Event of Default, Indenture Default or
Indenture Event of Default. Subject to the terms of Section 3.06(e) hereof
and the rights of the Indenture Trustee under the Indenture, the Owner
Trustee shall take such action with respect to such Default, Event of
Default, Indenture Default or Indenture Event of Default as shall be
specified in written instructions from the Trustor; provided that the Owner
Trustee shall have no duty to take any (and shall take no) action
whatsoever in the absence of written instructions from the Trustor. For
all purposes of this Agreement and the Lease, in the absence of actual
knowledge of a Responsible Officer of the Owner Trustee, the Owner Trustee
shall not be deemed to have knowledge of a Default, Event of Default,
Indenture Default or Indenture Event of Default unless notified in writing
by the Lessee, the Trustor, the Indenture Trustee or any Certificate
Holder.
Section 3.04. Action Upon Instructions. Upon the written
instructions at any time and from time to time of the Trustor, the Owner
Trustee will take or refrain from taking such action, not inconsistent with
provisions of the Indenture, as may be specified in such instructions.
Section 3.05. Certain Duties and Responsibilities of Owner
Trustee. (a)(i) The Owner Trustee undertakes to perform such duties and
only such duties as are specifically set forth herein, and with the degree
of care specified in Section 3.01 hereof, and in accordance with written
instructions given by the Trustor hereunder, and no implied duties,
covenants or obligations shall be read into this Agreement, any such
instructions or the Operative Agreements against the Owner Trustee, and the
Owner Trustee agrees that it will not manage, control, possess, use, sell,
lease, dispose of or otherwise deal with the Aircraft or any part of the
Lessor's Estate except as required by the terms of the Operative
Agreements, any such instructions and as otherwise provided herein; and
(ii) in the absence of bad faith on its part, the Owner Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Owner Trustee and conforming to the requirements of
this Agreement or the other Operative Agreements, but in the case of any
such certificates or opinions which by any provisions hereof or thereof
are specifically required to be furnished to the Owner Trustee, the
Owner Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Trust Agreement
or the Operative Agreements.
(b) No provision hereof shall require FSBU in its individual
capacity to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
Notwithstanding the foregoing, FSBU agrees in its individual capacity that
it will, at its own cost and expense, promptly take such action as may be
necessary to discharge duly all Lessor's Liens attributable to it in its
individual capacity and will claim no indemnity therefor hereunder, or
under the Participation Agreement or any Operative Agreement.
(c) Whether or not therein expressly so provided, every provision
of this Agreement relating to the conduct or affecting the liability of or
affording protection to the Owner Trustee shall be subject to the
provisions of this Section 3.05, except that in the event of a conflict
between this Section 3.05 and Section 3.01 hereof, Section 3.01 hereof
shall be controlling.
(d) The Owner Trustee will furnish to the Trustor, promptly upon
receipt thereof, duplicates or copies of all reports, notices, requests,
demands, certificates, financial statements and any other instruments
furnished to the Owner Trustee hereunder or under the other Operative
Agreements or the Original Agreements (including those furnished to the
Indenture Trustee pursuant to the terms of the Indenture) and not otherwise
furnished to the Trustor.
(e) Notwithstanding anything herein to the contrary, the Owner
Trustee shall not be authorized and shall have no power to "vary the
investment" of the Trustor within the meaning of Treasury Regulations
Section 301.7701-4(c)(1), it being understood that the Owner Trustee shall
have the power and authority to fulfill its obligations under Section 2.06
hereof and Article 23 of the Lease.
Section 3.06. Certain Rights of Owner Trustee. Except as otherwise
provided in Section 3.05 hereof:
(a) in the absence of bad faith on its part, the Owner Trustee may
rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order 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 or authorization by the Trustor or any
other party to any other Operative Agreement shall be sufficiently
evidenced by a request, direction or authorization in writing, delivered to
the Owner Trustee, and signed in the name of such party by any of the
Chairman of the Board, the President, any Vice President, the Treasurer or
Assistant Treasurer or the Secretary or Assistant Secretary or other duly
authorized officer of such party; and any resolution of the Board of
Directors or committee thereof of such party shall be sufficiently
evidenced by a copy of such resolution certified by the Secretary or an
Assistant Secretary of such party, to have been duly adopted and to be in
full force and effect on the date of such certification, and delivered to
the Owner Trustee;
(c) whenever in the administration of this Agreement the Owner
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder or under any
of the other Operative Agreements, the Owner Trustee (unless other
evidence be herein or therein specifically prescribed), absent actual
knowledge of a Responsible Officer of the Owner Trustee to the contrary,
may rely in good faith upon a certificate in writing, delivered to the
Owner Trustee and signed by any of the Chairman of the Board, the
President, any Vice President, the Treasurer or Assistant Treasurer or
the Secretary or Assistant Secretary of the Lessee, the Trustor, or the
Indenture Trustee and notice of such need for such proof or
establishment shall be delivered to the Trustor, who may advise the
Owner Trustee in respect of such matter and the Owner Trustee shall act
in conformity with such advice;
(d) the Owner Trustee may exercise its powers and perform its
duties by or through such attorneys, agents and servants as it shall
appoint with due care, and it shall be entitled to rely upon the advice
of counsel reasonably selected by it with due care and shall be
protected by the advice of such counsel in anything done or omitted to
be done in accordance with such advice;
(e) the Owner Trustee shall not be under any obligation to take
any action under this Agreement or under any of the other Operative
Agreements at the request or direction of the Trustor unless the Persons
making such request or direction shall have offered to the Owner Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction; nor shall the Owner Trustee be required to take
any action deemed to impose on the Owner Trustee any obligation to take
any action, if the Owner Trustee shall have been advised by its counsel
that such action is unlawful or is contrary to the terms of this
Agreement or the other Operative Agreements;
(f) the Owner Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order or other paper or document unless a Responsible Officer
of the Owner Trustee has actual knowledge that the facts or matters
stated therein are false or inaccurate, but the Owner Trustee in its
discretion may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Owner Trustee shall
determine to make such further inquiry or investigation, it shall be
entitled, to the same extent permitted to the Lessor under the Lease, to
examine the books and records of the Lessee to reasonably determine
whether the Lessee is in compliance with the terms and conditions of the
Lease and to examine the Aircraft, Airframe, Engines or any Part thereof
personally or by agent or attorney; and
(g) without limiting the generality of Section 3.05 hereof, except
as otherwise provided in written instructions given to the Owner Trustee
by the Trustor or as otherwise provided in the Indenture or the
Participation Agreement, the Owner Trustee shall not have any duty (i)
to see to any recording or filing of the Lease or of this Agreement or
any financing statement or other notice or document relating thereto or
contemplated under the Operative Agreements or to see to the maintenance
of any such recording or filing (other than FAA reporting requirements
contained in 14 C.F.R. Sections 47.45 and 47.51), (ii) to see to any
insurance on the Aircraft or any part thereof or to effect or maintain
any such insurance, whether or not the Lessee shall be in default with
respect thereto, other than to forward to the Trustor and (to the extent
provided in the Indenture) the Indenture Trustee copies of all
certificates, reports and other written information which it receives
from the Lessee pursuant to the Lease, (iii) to see to the payment or
discharge of any tax, assessment or other governmental charges or any
Lien (except any Lessor's Lien attributable to it in its individual
capacity) owing with respect to, or assessed or levied against any part
of the Lessor's Estate, (iv) to confirm or verify any financial
statements or reports of the Lessee, or (v) to inspect the Aircraft at
any time or ascertain or inquire as to the performance or observance of
any of the Lessee's covenants under the Lease.
Section 3.07. No Representations or Warranties as to Certain
Matters. NEITHER THE OWNER TRUSTEE NOR FSBU MAKES OR SHALL BE DEEMED TO
HAVE MADE (a) ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO
THE TITLE, AIRWORTHINESS, VALUE, CONDITION, WORKMANSHIP, DESIGN, COMPLIANCE
WITH SPECIFICATIONS, CONSTRUCTION, OPERATION, MERCHANTABILITY OR FITNESS
FOR USE FOR A PARTICULAR PURPOSE OF THE AIRCRAFT, AS TO THE ABSENCE OF
LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF
ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE
OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT, OR ANY OTHER
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO
THE AIRCRAFT OR ANY PART THEREOF, except that FSBU represents and warrants
that on the Delivery Date the Owner Trustee shall have received whatever
right, title and interests in, to and under the Aircraft that were conveyed
to it by AVSA and FSBU represents, warrants and covenants that at all times
on and after the Delivery Date the Aircraft shall be free of all Lessor's
Liens attributable to it, and that the Owner Trustee shall comply with the
last sentence of Section 3.05(b) hereof, or (b) any representation or
warranty as to the validity, legality or enforceability of this Agreement
or any other Operative Agreement to which the Owner Trustee is a party, or
any other document or instrument, or as to the correctness of any statement
contained in any thereof, except to the extent that any such
representation, warranty or statement is expressly made herein or therein
as a representation or warranty by the Owner Trustee or FSBU and except
that FSBU hereby represents and warrants that this Agreement has been, and
(assuming the due authorization, execution and delivery of this Agreement
by the Trustor) the other Operative Agreements to which the Owner Trustee
is a party have been (or at the time of execution and delivery of any such
instrument by the Owner Trustee hereunder or pursuant to the terms of the
Participation Agreement that such an instrument will be) duly executed and
delivered by one of its officers who is or will be, as the case may be,
duly authorized to execute and deliver such instruments on behalf of the
Owner Trustee and that this Agreement has been duly authorized, executed
and delivered by FSBU and (assuming due authorization, execution and
delivery of this Trust Agreement by the Trustor) constitutes the legal,
valid and binding obligation of FSBU enforceable against it in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
rights of creditors generally and by general principles of equity.
Section 3.08. Status of Moneys Received. All moneys received by
the Owner Trustee under or pursuant to any provision of this Agreement or
any Operative Agreement shall constitute trust funds for the purpose for
which they were paid or are held, but need not be segregated in any manner
from any other moneys except to the extent required by law and may be
deposited by the Owner Trustee under such conditions as may be prescribed
or permitted by law for trust funds, or may be invested in direct
obligations of the United States.
Section 3.09. Self-Dealing. The Owner Trustee in its individual
capacity, or any corporation in or with which the Owner Trustee may be
interested or affiliated, or any officer or director of any such
corporation, may have normal commercial relations, and otherwise deal, in
the ordinary course of business, with the Lessee or any other corporation
having relations with the Lessee to the full extent permitted by law.
Section 3.10. Definition of a Responsible Officer. For purposes
of this Trust Agreement only, "Responsible Officer" when used with respect
to the Owner Trustee means the Chairman or the Vice-Chairman of the Board
of Directors, the Chairman or Vice-Chairman of the Executive Committee of
the Board of Directors, the President, any Vice President (whether or not
designated by a number or a word or words added before or after the title
"Vice President"), the Secretary, any Assistant Secretary, or any other
officer in the Corporate Trust Department of FSBU customarily performing
functions similar to those performed by any of the above designated
officers.
Section 3.11. Resignation or Removal of Owner Trustee. The Owner
Trustee or any successor thereof (a) shall resign if required to do so
pursuant to Section 7.02(b) of the Participation Agreement and (b) may
resign at any time without cause by giving at least 60 days' prior written
notice to the Trustor and the Indenture Trustee, such resignation in each
case to be effective only upon the appointment of a successor trustee and
the acceptance of such appointment by such successor. In addition, the
Trustor may at any time remove the Owner Trustee without cause by an
instrument in writing delivered to the Owner Trustee and the Indenture
Trustee, such removal to be effective only upon the appointment by the
Trustor of a successor Owner Trustee and the acceptance of such appointment
by such successor. Upon the giving of notice of resignation or removal of
the Owner Trustee, the Trustor may appoint a successor Owner Trustee by an
instrument signed by the Trustor. If the Trustor shall not have so
appointed a successor Owner Trustee within 30 days after such resignation
or removal, the Owner Trustee, the Indenture Trustee or the Trustor may
apply to any court of competent jurisdiction to appoint a successor Owner
Trustee to act until such time, if any, as a successor or successors shall
have been appointed by the Trustor as above provided. Any successor Owner
Trustee so appointed by a court shall be superseded by any successor Owner
Trustee subsequently appointed by the Trustor.
The appointment of any successor Owner Trustee shall be subject to
the conditions set forth in Section 11.01 of the Participation Agreement.
Section 3.12. Estate and Rights of Successor Owner Trustee. Any
successor Owner Trustee, however appointed, shall execute and deliver to
the predecessor Owner Trustee, with a copy to the Trustor and the Indenture
Trustee, an instrument accepting such appointment, in form and substance
acceptable to the predecessor Owner Trustee and the Trustor and thereupon
each successor Owner Trustee, without further act, shall become vested with
all the estates, properties, rights, powers, duties and trust of the
predecessor Owner Trustee in the trust hereunder with like effect as if
originally named as an Owner Trustee herein, but nevertheless upon the
written request of such successor Owner Trustee, such predecessor Owner
Trustee shall execute and deliver an instrument transferring to such
successor Owner Trustee, upon the trust herein expressed, all estates,
properties, rights, powers, duties, property or moneys then held by such
predecessor Owner Trustee upon the trust herein expressed. Upon any such
transfer by a predecessor Owner Trustee, such predecessor Owner Trustee
shall provide the successor Owner Trustee and Trustor an accounting of the
Lessor's Estate and the trust hereunder.
Upon the appointment of any successor Owner Trustee hereunder, the
predecessor Owner Trustee will use its best efforts to cause registration
of the Aircraft included in the Lessor's Estate to be transferred upon the
records of the Aeronautics Authority or other registry where the Aircraft
may then be registered into the name of the successor Owner Trustee and
shall otherwise use its best efforts to comply, or assist the successor
Owner Trustee in complying, with the provisions of Section 11.01 of the
Participation Agreement.
Section 3.13. Merger or Consolidation of FSBU. Any corporation
into which FSBU in its individual capacity may be merged or with which it
may be consolidated, or any corporation resulting from any merger or
consolidation to which FSBU shall be a party, or any corporation to which
substantially all the business of the Owner Trustee in its individual
capacity may be transferred, shall, subject to Section 11.01 of the
Participation Agreement, be the Owner Trustee under this Agreement without
further act; provided, that such corporation shall not also be the
Indenture Trustee.
Section 3.14. Co-Trustees. At any time, if the Owner Trustee or
the Trustor shall deem it necessary or prudent or desirable in order to
conform to legal requirements of any jurisdiction in which any part of the
Lessor's Estate may at the time be located, the Owner Trustee by an
instrument in writing signed by it, shall appoint one or more Persons
approved by the Trustor to act as co-trustee, or co-trustees, jointly with
the Owner Trustee, or separate trustee or separate trustees (except insofar
as local law makes it necessary or prudent or desirable for any such co-
trustee or separate trustee to act alone), of all or any part of the
Lessor's Estate, and to vest in such Person or Persons, in such capacity,
such title to the Lessor's Estate or any part thereof, and such rights,
powers, duties, trusts or obligations as the Trustor may consider necessary
or prudent or desirable. The Owner Trustee shall not be liable for any act
or omission of any co-trustee or separate trustee appointed under this
Section 3.14. No appointment of, or action by, any co-trustee or separate
trustee appointed under this Section 3.14 will relieve the Owner Trustee of
any of its obligations under any Operative Agreement or otherwise affect
any of the terms of the Indenture or adversely affect the interests of the
Indenture Trustee or the Certificate Holders in the Trust Indenture Estate.
Any co-trustee or separate trustee may, at any time by an
instrument in writing, constitute the Owner 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
subject to the conditions of this Agreement.
Every additional trustee hereunder shall be a Citizen of the United
States and, to the extent permitted by law, be appointed and act, and the
Owner Trustee and its successors shall act, subject to the following
provisions and conditions:
(A) all powers, duties, obligations and rights conferred upon the
Owner Trustee in respect of the custody, control and management of monies,
the Aircraft or documents authorized to be delivered hereunder or under the
Participation Agreement shall be exercised solely by the Owner Trustee;
(B) all other rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred or imposed upon and
exercised or performed by the Owner Trustee and such additional trustee
jointly, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed (including the holding
of title to the Lessor's Estate) the Owner 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
additional trustee;
(C) no power given to, or which is provided hereby may be exercised
by, any such additional trustee, except jointly with, or with the consent
in writing of, the Owner Trustee;
(D) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder except as otherwise provided
hereunder; and
(E) the Trustor, at any time, by an instrument in writing may remove
any such additional trustee.
Section 3.15. Interpretation of Agreements. In the event that
the Owner Trustee is unsure as to the application of any provision of this
Agreement or any other Operative Agreement or any other agreement relating
to the transactions contemplated by the Operative Agreements or such
provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement or any other Operative Agreement permits any determination by the
Owner Trustee or is silent or incomplete as to the course of action which
the Owner Trustee is required to take with respect to a particular set of
facts, the Owner Trustee shall request in writing sent in accordance with
Article 14 of the Participation Agreement instructions of the Trustor and,
to the extent that the Owner Trustee acts in good faith in accordance with
any instructions received from the Trustor, shall not be liable to any
Person; provided, that in the event that no response is made to the Owner
Trustee by the Trustor within 25 Business Days after such request, the
Owner Trustee shall not be liable to any Person for acts taken by the Owner
Trustee in good faith in what it deems to be the best interests of the
Trustor or for any failure to act in any situation described above in this
Section 3.15. The provisions of this Section 3.15 shall not be applicable
to the Owner Trustee's obligations set forth in the last sentence of
Section 3.01 hereof.
Section 3.16. Not Acting in Individual Capacity. In carrying out
the trust hereby created, the Owner Trustee will act solely as trustee
hereunder and not in its individual capacity except as expressly provided
herein or in the other Operative Agreements to which it is a party; and all
Persons, other than the Trustor as provided in this Agreement, having any
claim against the Owner Trustee by reason of the transactions contemplated
hereby shall look only to the Lessor's Estate for payment or satisfaction
thereof, except to the extent provided in the last sentence of Section 3.01
hereof.
Section 3.17. Tax Returns. The Owner Trustee shall be
responsible for the keeping of all appropriate books and records relating
to its receipt and disbursement of all moneys under this Agreement or any
Operative Agreement. The Trustor shall be responsible for causing to be
prepared and filed all income tax returns required to be filed by the
Trustor. The Owner Trustee, upon request, will furnish the Trustor with
all such information as may be reasonably required or necessary from the
Owner Trustee in connection with the preparation of such tax returns and in
connection with any other filing or audit and related litigation
obligations. The Owner Trustee shall be responsible for causing to be
prepared at the request of the Trustor and at the expense of the Lessee all
income tax returns required to be filed with respect to the trust created
hereby and shall execute and file such returns; provided, however, that the
Owner Trustee shall send a completed copy of each such return to the
Trustor not more than 60 nor less than 30 days prior to the due date of
such return; provided that the Owner Trustee shall have timely received all
necessary information to complete and deliver to the Trustor such return.
The Trustor, upon request, will furnish the Owner Trustee with all such
information as may be required from the Trustor in connection with the
preparation of such income tax returns.
ARTICLE 4
TERMINATION OF TRUST
Section 4.01. Termination. This Agreement and the trust created
and provided for hereby shall cease and be terminated in any one of the
following events, whichever shall first occur:
(a) The sale or other final disposition by the Owner Trustee of
all of its interest in all property constituting or included in the
Lessor's Estate and, if the Indenture shall then be in effect, the sale
or other disposition by the Indenture Trustee of all of its interest in
all property constituting or included in the Lessor's Estate, and the
final disposition by the Owner Trustee and, if the Indenture shall then
be in effect, the Indenture Trustee, of all moneys or other property or
proceeds constituting part of the Lessor's Estate in accordance with the
terms hereof; or
(b) 110 years from the earlier execution of this Agreement by
either party hereto; provided, however, that if the Trust shall be or
become valid under applicable law for a period subsequent to 110 years
from the earlier execution of this Agreement by either party hereto or,
without limiting the generality of the foregoing, if legislation shall
become effective providing for the validity or permitting the effective
grant of such trust for a period, in gross, exceeding the period for
which such trust is hereinabove stated to extend and be valid, then such
trust shall not terminate as provided in the first part of this sentence
but shall extend to and continue in effect until, but only if such non-
termination and extension shall then be valid under applicable law, such
time as the same shall, under applicable law, cease to be valid.
Section 4.02. Termination at Option of the Trustor.
Notwithstanding Section 4.01 hereof, this Agreement and the trust created
hereby shall terminate and the Trust Estate shall be distributed to the
Trustor, and this Agreement shall be of no further force and effect, upon
the election of the Trustor by notice to the Owner Trustee, if such notice
shall be accompanied by the written agreement (in form and substance
satisfactory to the Owner Trustee) of the Trustor assuming all the
obligations of the Owner Trustee under or contemplated by the Operative
Agreements or incurred by it as trustee hereunder and releasing the Owner
Trustee therefrom; provided, however, that such notice may be given only
after the time the Lien of the Indenture is discharged under Section 14.01
of the Indenture unless the Trustor shall have received the prior written
consent of the Indenture Trustee to any such termination in which case such
notice may be given while the Lien of the Indenture is outstanding.
Section 4.03. Distribution of Lessor's Estate upon Termination.
Upon any termination of this trust pursuant to the provisions of Section
4.01 hereof, the Owner Trustee shall convey the Lessor's Estate (subject to
all obligations, if any, of the Owner Trustee then existing under the
Operative Agreements to which the Owner Trustee is a party) to such
purchaser or purchasers or the Trustor, as the case may be, and for such
amount and on such terms as shall be specified in written instructions from
the Trustor delivered to the Owner Trustee prior to the date of
termination; provided, that (i) if at the time of any termination the Lease
remains in force and effect, then the Lessor's Estate shall be sold as a
unit (and not in parcels) and subject to the Lease, and (ii) in the event
such written instructions are not delivered to the Owner Trustee on or
before the date of termination, the Owner Trustee shall transfer title to
the Lessor's Estate to the Trustor. Upon making such transfer or sale and
accounting for all funds which have come into its hands, the Owner Trustee
shall be entitled to receipt of any sums due and owing to the Owner Trustee
for expenses incurred pursuant hereto as set forth in Section 2.05 hereof.
ARTICLE 5
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ARTICLE 6
MISCELLANEOUS
Section 6.01. Indemnification. The Trustor and its assigns agree
to reimburse and save FSBU, in its individual capacity, harmless against
any and all loss, damage, liability, claims, demands, disbursements and
expenses, including Taxes (excluding Taxes imposed against FSBU upon or
with respect to any fees for services rendered in its capacity as Trustee
hereunder) and reasonable counsel fees which may be incurred by reason of
its being the Owner Trustee or acting hereunder or under the Operative
Agreements or the Original Agreements, but solely by reason thereof and
arising out of or relating solely to this Agreement or the other Operative
Agreements or the Original Agreements or the Aircraft or the Rents and
other sums payable therefor, or by reason of any occurrence directly
relating thereto while so acting, and to secure the payment thereof, FSBU,
in its individual capacity, shall have a Lien on the Lessor's Estate and
the proceeds thereof, including income, prior to any interest therein of
the Trustor and its assigns (but subject to the rights of the Lessee under
the Operative Agreements and the Original Agreements and subject and
subordinate to the Lien of the Indenture), except that FSBU shall not have
any such Lien (and the Trustor shall have no obligation) in respect of any
such loss, damage, liability, claims, demands, disbursements and expenses,
including Taxes and counsel fees, arising from or as a result of (A)
FSBU's or the Owner Trustee's willful misconduct or gross negligence (in
its individual capacity or as trustee), (B) any inaccuracy of any
representation of FSBU or any breach by FSBU of its warranties and
covenants given in its individual capacity in this Agreement, Article 5 of
the Lease, Sections 7.02(a) and (b) and 7.04 of the Participation Agreement
and its representations and warranties in Sections 3.05 and 3.08 of the
Indenture or elsewhere in the Operative Agreements, (C) the failure to use
ordinary care in receiving, handling and disbursing funds, (D) Lessor's
Liens attributable to it in its individual capacity, (E) Taxes, fees, or
other charges on, based on, or measured by, any fees, commissions or
compensation received by FSBU in connection with the transactions
contemplated by the Lease, the Indenture and this Agreement, (F) Taxes
excluded from indemnification pursuant to Section 8.01(b) of the
Participation Agreement (disregarding for the purposes of this Section
6.01, subsections (ii) and (v) of Section 8.01(b) of the Participation
Agreement) or (G) Expenses excluded from indemnification pursuant to
Section 9.01(b) of the Participation Agreement; provided, that, before
asserting any right to payment or indemnification hereunder, FSBU shall
first demand its corresponding right to payment or indemnification from the
Lessee pursuant to the Participation Agreement. It is further understood
that the distribution by the Owner Trustee of all or any part of the
Lessor's Estate as provided in Section 4.02 of this Agreement shall not
impair the right of FSBU to indemnity, payment and reimbursement as herein
provided. The provisions of this Section shall continue in force and
effect notwithstanding the termination of this trust or the resignation,
inability or incapacity to act or removal of the Owner Trustee. FSBU or
the Owner Trustee (in its individual capacity or as trustee, as the case
may be) agrees that it shall have no right against the Trustor or the Trust
Indenture Estate for any fee as compensation for its services hereunder.
Upon any assignment, conveyance or transfer of all of the Beneficial
Interest, the transferor Trustor shall, upon such assignment, conveyance or
transfer, be released and discharged without further act or formality
whatsoever from the indemnification obligations imposed under this Section
6.01 arising after such transfer date.
Section 6.02. Supplements and Amendments. At any time and from
time to time, only upon the written request of the Trustor (a) FSBU and
the Trustor shall execute a supplement hereto for the purpose of adding
provisions to, or changing or eliminating provisions of, this Agreement as
specified in such request and (b) the Owner Trustee shall, subject to the
provisions of Section 8.01 of the Indenture, enter into or consent to such
written amendment or modification of or supplement to any of the Operative
Agreements as the Trustor and any other necessary parties may agree to in
writing and as may be specified in such request, or execute and deliver
such written waiver of the terms of any of the Operative Agreements as may
be agreed to in writing by the Trustor and as may be specified in such
request; provided, that (i) the Owner Trustee shall not execute any such
supplement, amendment, waiver or modification without the prior written
consent of the Trustor, (ii) if in the reasonable opinion of the Owner
Trustee any document required to be executed by it pursuant to this Section
adversely affects any right or duty of, or immunity or indemnity in favor
of, the Owner Trustee under this Agreement or any other Operative
Agreement, the Owner Trustee may in its discretion decline to execute such
document and (iii) any amendment or supplement to this Agreement shall
comply with the provisions of Section 7.13 of the Participation Agreement.
It shall not be necessary that any request pursuant to this Section specify
the particular form of the proposed document to be executed pursuant to
such request, but it shall be sufficient if such request shall indicate the
substance thereof. Promptly after the execution by FSBU or the Owner
Trustee of any document pursuant to this Section, the Owner Trustee shall
mail a conformed copy thereof to the Trustor, the Indenture Trustee and the
Lessee, but the failure of the Owner Trustee to mail such conformed copies
shall not impair or affect the validity of such document.
Section 6.03. Nature of Title of Trustor. The Trustor shall not
have any legal title to any part of the Lessor's Estate. No transfer, by
operation of law or otherwise, of the right, title and interest of the
Trustor in and to the Lessor's Estate or the trust hereunder shall operate
to terminate this Agreement or Lessor's Estate.
Section 6.04. Power of Owner Trustee to Convey. Any assignment,
sale, transfer or other conveyance by the Owner Trustee of the interest of
the Owner Trustee in the Operative Agreements or in the Aircraft or any
part thereof pursuant to and in compliance with the terms of this Agreement
or the Operative Agreements shall bind the Trustor and shall be effective
to transfer or convey all right, title and interest of the Owner Trustee in
and to the Operative Agreements or the right, title and interest of the
Owner Trustee and the Trustor in and to the Aircraft or such part thereof.
No purchaser or other grantee shall be required to inquire as to the
authorization, necessity, expediency or regularity of such assignment,
sale, transfer or conveyance or as to the application of any sale or other
proceeds with respect thereto by the Owner Trustee.
Section 6.05. Notices. All notices, demands, declarations and
other communications required by this Agreement shall be in writing and
shall be deemed received (a) if given by telecopier, when transmitted and
the appropriate telephonic confirmation received if transmitted on a
Business Day and during normal business hours of the recipient, and
otherwise on the next Business Day following transmission, (b) if given by
certified mail, return receipt requested, postage prepaid five Business
Days after being deposited in the United States mail, and (c) if given by
FedEx service or other means, when received or personally delivered,
addressed:
If to the Owner Trustee:First Security Bank of Utah, National Association
79 South Main Street
Salt Lake City, Utah 84111
Attention: Corporate Trust Department
Telephone: (801) 246-5826
Facsimile: (801) 246-5053
If to the Trustor: PMCC Leasing Corporation
800 Westchester Avenue
Rye Brook, New York 10573-1301
Attention: Vice President Leasing
with a copy to Director, Portfolio Administration
Telephone: (914) 335-5000
Facsimile: (914) 335-1287
If to the Indenture
Trustee: State Street Bank and Trust Company
Two International Place
4th Floor
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Telephone: (617) 664-5414
Facsimile: (617) 664-5371
or as to any of the foregoing parties at such other address as such party may
designate by notice duly given in accordance with this Section to the other
parties.
Section 6.06. Situs of Trust; Applicable Law; Severability.
THIS AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF UTAH, INCLUDING ALL
MATTERS OF VALIDITY, CONSTRUCTION AND PERFORMANCE. If any provision of
this Agreement shall be invalid or unenforceable, the remaining provisions
hereof shall continue to be fully effective; provided, that such remaining
provisions do not increase the obligations or liabilities of the Owner
Trustee or the Trustor.
Section 6.07. Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of, and shall be enforceable
by, the parties hereto and their respective successors and permitted
assigns, including any successive holder of the Beneficial Interest, but
only to the extent the Beneficial Interest has been transferred or assigned
in accordance with the limitations of Section 7.03(d) of the Participation
Agreement.
Section 6.08. Headings and Table of Contents. The headings of
the Articles and Sections of this Agreement and the Table of Contents are
inserted for convenience only and shall not affect the meaning or
construction of any of the provisions hereof.
Section 6.09. Identification of Trust. This trust may for
convenience be referred to as the "Federal Express Corporation Trust No.
N668FE."
Section 6.10. Counterparts. This instrument may be executed in
any number of counterparts or upon separate signature pages bound together
in several counterparts, each of which when so executed shall be deemed to
be an original, and such counterparts together shall constitute and be one
and the same instrument.
Section 6.11. Trustor Interest. The Trustor has only a
beneficial interest in any specific property of this trust. No creditor of
the Trustor shall have any right to obtain possession of, or otherwise
exercise legal or equitable remedies with respect to, the property of this
trust (as opposed to the Trustor's beneficial interest in this trust).
Section 6.12. Performance by the Trustor. Any obligation of the
Owner Trustee hereunder or under any Operative Agreement or other document
contemplated herein may be performed by the Trustor and any such performance
shall not be construed as a revocation of the trust created hereby.
IN WITNESS WHEREOF, FSBU and the Trustor have caused this Agreement
to be duly executed all as of the date first above written.
PMCC LEASING CORPORATION
By:______________________________________________
Name:
Title:
FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION
By:______________________________________________
Name:
Title:
SCHEDULE I
DEFINITIONS
GENERAL PROVISIONS
The following terms shall have the following meanings for all
purposes of the Operative Agreements (other than the Pass Through Agreement
and the Series Supplements) referred to below, unless otherwise defined in an
Operative Agreement or the context thereof shall otherwise require. In the
case of any conflict between the provisions of this Schedule and the
provisions of any Operative Agreement, the provisions of such Operative
Agreement shall control the construction of such Operative Agreement.
Unless the context otherwise requires and except in the case of the
Original Agreements, (i) references to agreements shall be deemed to mean and
include such agreements as amended and supplemented from time to time, and
(ii) references to parties to agreements shall be deemed to include the
successors and permitted assigns of such parties.
DEFINED TERMS:
Additional Insured. As defined in Article 13 of the Lease.
Aeronautics Authority. As appropriate, the Federal Aviation
Administration and/or the Administrator of the Federal Aviation
Administration, any successor to the former United States Civil Aeronautics
Board, or any Person, governmental department, bureau, commission or agency
located in the United States succeeding to the functions of any of the
foregoing.
Affiliate. With respect to any Person, any other Person directly
or indirectly controlling, controlled by or under common control with such
Person. For the purposes of this definition, "control" (including
"controlled by" and "under common control with") shall mean the power,
directly or indirectly, to direct or cause the direction of the management
and policies of such Person whether through the ownership of voting
securities or by contract or otherwise. In no event shall the Owner
Trustee or the Lessor be deemed an Affiliate of the Owner Participant.
After-Tax Basis. A basis such that any payment to be received by
a Person shall be supplemented by a further payment to such Person so that
the sum of the two payments, after deduction of all Taxes resulting from
the receipt or accrual of such payments, shall be equal to the payment to
be received. In the case of amounts payable to the Lessor, the Owner
Participant, or any corporate Affiliate of the Owner Participant, it shall
be presumed that such Person is at all times subject to Federal income tax
at the maximum marginal rate generally applicable to corporations from time
to time and actual state, local and foreign income taxes.
Agent. Morgan Guaranty Trust Company of New York and its
successors and permitted assigns as Agent for the Original Loan
Participants pursuant to Article 16 of the Original Participation
Agreement.
Air Carrier. Any U.S. Air Carrier and any "foreign air carrier" (as
defined in the Transportation Code) as to which there is in force a permit
granted under Section 41302 of the Transportation Code.
Airbus Guaranty. The Guaranty dated the Delivery Date executed by
the Manufacturer and guaranteeing AVSA's Warranty Bill of Sale.
Aircraft. The Airframe (or any permitted substitute airframe
thereunder) together with two Engines (whether either is an initial Engine or
a Replacement Engine) whether or not any of such initial or Replacement
Engines may from time to time be installed on such Airframe or may be
installed on any other airframe or on any other aircraft, including any
aircraft substituted pursuant to Section 11.03 of the Lease.
Airframe. The Airbus A300F4-605R aircraft (excluding the Engines
or engines from time to time installed thereon) leased by the Lessor to the
Lessee pursuant to the Lease and the initial Lease Supplement and having
the United States FAA Registration Number initially and manufacturer's
serial number specified in the initial Lease Supplement, including (i) all
Parts in respect thereof and (ii) any replacement airframe which may be
substituted pursuant to Section 11.03 of the Lease.
Amendment No. 1 to the Original Tax Indemnity Agreement. Amendment
No. 1 to the Original Tax Indemnity Agreement (Federal Express Corporation
Trust No. N668FE), dated as of June 1, 1996.
Ancillary Agreement. Any written agreement of the Lessee to which
the Lessor is a party or to which the Lessor has consented in writing
entered into on the Delivery Date or the Refunding Date or any date
thereafter in connection with the transactions contemplated by the
Operative Agreements, as such agreement may be amended and supplemented
from time to time with the consent of the Lessor and delivered to the Owner
Trustee, the Indenture Trustee, the Pass Through Trustee and the Owner
Participant.
Ancillary Agreement I. The Ancillary Agreement I (Federal Express
Corporation Trust No. N668FE), dated the Delivery Date, as amended and
restated as of the Refunding Date, among the Lessee, the Owner Trustee, not
in its individual capacity, but solely as Owner Trustee, the Owner
Participant and the Indenture Trustee not in its individual capacity, but
solely as Indenture Trustee, as originally executed or as amended, modified
or supplemented with the consent of all the parties thereto.
Ancillary Agreement II. The Ancillary Agreement II (Federal
Express Corporation Trust No. N668FE), dated the Refunding Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as
Owner Trustee, the Owner Participant and the Indenture Trustee not in its
individual capacity, but solely as Indenture Trustee, as originally
executed or as amended, modified or supplemented with the consent of all
the parties thereto.
Appraisal. The report prepared by BK Associates, Inc. and delivered
to the Owner Participant (with an abbreviated report to the Lessee) on the
Delivery Date pursuant to Section 4.01(n) of the Original Participation
Agreement.
Assignment and Assumption Agreement. Any agreement delivered in
compliance with Section 7.03(d) of the Participation Agreement.
AVSA. AVSA S.A.R.L., a societe a responsabilite limitee, organized
and existing under the laws of France, and its successors and assigns.
AVSA Consent and Agreement. The Consent and Agreement dated as of
May 15, 1996, executed by AVSA, as the same may be amended, modified or
supplemented from time to time.
AVSA's FAA Bill of Sale. The bill of sale for the Airframe on AC
Form 8050-2, or such other form as may be approved by the Aeronautics
Authority, executed by AVSA in favor of the Owner Trustee and dated the
Delivery Date.
AVSA's Warranty Bill of Sale. The full warranty bill of sale
covering the Aircraft (and specifically referring to each Engine) executed by
AVSA as owner of the Aircraft in favor of the Owner Trustee and dated the
Delivery Date.
Bankruptcy Code. The Federal Bankruptcy Code of 1978, as amended,
and any successor thereto.
Bankruptcy Default. An event specified in Section 16.01(e), (f) or
(g) of the Lease which either does or, with the giving of notice or lapse of
time or both, would constitute an Event of Default.
Basic Rent. The aggregate periodic rent payable for the Aircraft
throughout the Basic Term pursuant to Section 3.02 of the Lease, adjusted
pursuant to Article 3 of the Lease.
Basic Term. The period commencing at the beginning of the day on
the Commencement Date and ending at the end of the day on August 24, 2019,
or such earlier date on which the Lease shall be terminated as provided
therein.
Beneficial Interest. The interest of the Owner Participant under
the Trust Agreement.
Breakage Costs. Has the meaning specified in Schedule II to the
Original Participation Agreement.
Business Day. Any day on which commercial banks are not
authorized or required to close in New York, New York, Memphis,
Tennessee and the city in which the office or agency in the United States
is maintained by the Pass Through Trustee for the payment of the Pass
Through Certificates, and after the Lien of the Indenture is discharged,
Salt Lake City, Utah.
Certificates. The Equipment Trust Certificates (Federal Express
Corporation Trust No. N668FE), issued by the Owner Trustee pursuant to the
Indenture and any certificate issued in exchange therefor or replacement
thereof pursuant to the Indenture.
Change in Tax Rate. Any amendment, modification, deletion,
addition, or change to the Code which is enacted into law after the
Delivery Date which changes the highest marginal statutory rate of Federal
income tax applicable to the Owner Participant (other than a change which
is in the nature of a minimum tax).
Citizen of the United States. A citizen of the United States as
defined in Section 40102(a)(15) of the Transportation Code, or any analogous
part of any successor or substituted legislation or regulation at the time in
effect.
Closings. The closing with respect to the acquisition of the Pass
Through Certificates by the Underwriters and the closing with respect to the
refunding of the Original Loan Certificates.
Code. Except as otherwise provided, the Internal Revenue Code of
1986, as amended from time to time.
Commencement Date. July 30, 1996.
Consent and Agreement. The Consent and Agreement dated as of May
15, 1996 executed by the Manufacturer, as the same may be amended, modified
or supplemented from time to time.
Consent and Guaranty. The Consent and Guaranty of the Manufacturer
attached to the Purchase Agreement.
Corporate Trust Administration. The principal office of the
Indenture Trustee located at Two International Place, 4th Floor, Boston,
Massachusetts 02110, Attention: Corporate Trust Department, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Participant and the Owner Trustee.
Corporate Trust Department. The principal office of the Owner Trustee
located at 79 South Main Street, Salt Lake City, Utah 84111, Attention:
Corporate Trust Department, or such other office at which the Owner Trustee's
corporate trust business shall be administered which the Owner Trustee shall
have specified by notice in writing to the Lessee, the Owner Participant and
the Indenture Trustee.
CRAF Program. Has the meaning specified in Section 7.01(f) of the
Lease.
Debt Rate. The weighted average (based on Outstanding principal
amount) rate of interest on the Certificates issued pursuant to the Indenture.
Default. Any event or condition which, with the lapse of time or the
giving of notice, or both, would constitute an Event of Default.
Delivery Date. May 24, 1996.
Engine. Each of the two General Electric CF6-80C2-A5F engines
listed by manufacturer's serial numbers in the initial Lease Supplement and
leased pursuant to the Lease, whether or not from time to time installed on
the Airframe or installed on any other airframe or on any other aircraft,
and any Replacement Engine which may from time to time be substituted for
an Engine pursuant to Section 7.02(a)(vii), 10.02(c), 10.03, 11.03, 11.04
or 12.02 of the Lease, together with all Parts related thereto. Except as
otherwise provided, at such time as a Replacement Engine shall be so
substituted and the Engine for which the substitution is made shall be
released from the Lien of the Indenture, such replaced Engine shall cease
to be an "Engine" under the Lease. The term "Engines" means, as of any
date of determination, both Engines then leased to the Lessee pursuant to
the Lease.
Engine Consent. The Engine Consent dated as of May 15, 1996,
executed by the Engine Manufacturer, as the same may be amended, modified
or supplemented from time to time.
Engine Manufacturer. General Electric Company, a New York
corporation.
Engine Warranty Assignment. The Engine Warranty Assignment (Federal
Express Corporation Trust No. N668FE), dated as of May 15, 1996 between the
Lessor and the Lessee, as the same may be amended, modified or supplemented
from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan. As defined in Section 7.06 of the Participation
Agreement.
Estimated Expense Amount. Has the meaning specified in Section
10.01(a) of the Participation Agreement.
Event of Default. Each of the events specified in Article 16 of the
Lease.
Event of Loss. Any of the following events with respect to the
Aircraft, the Airframe or any Engine: (i) loss of such property or its use
(A) for a period in excess of 60 days due to theft or disappearance or such
longer period, not to exceed 180 days from the end of such initial 60-day
period, if and so long as the location of such property is known to the
Lessee and the Lessee is diligently pursuing recovery of such property, or
to the end of the Term, if less (unless such theft or disappearance
constitutes an Event of Loss pursuant to (i)(B) or (ii) hereof) or (B) for
a period in excess of 60 days due to the destruction, damage beyond
economic repair or rendition of such property permanently unfit for normal
use by Lessee for any reason whatsoever; (ii) any damage to such property
which results in an insurance settlement with respect to such property on
the basis of a total loss, or constructive or compromised total loss;
(iii) (1) condemnation, confiscation or seizure of, or requisition of
title to such property by the Government, any foreign government or
purported government or any agency or instrumentality thereof, or (2)
condemnation, confiscation, or seizure of, or requisition or taking of, use
of such property (A) by a foreign government or instrumentality or agency
of any such foreign government, for a period in excess of 180 days (or such
shorter period ending on the earlier of the expiration of the Term or on
the date on which an insurance settlement with respect to such property on
the basis of a total loss or constructive or compromised total loss shall
occur) or (B) by the Government for a period extending beyond the Term; and
(iv) as a result of any law, rule, regulation, order or other action by the
Aeronautics Authority or other governmental body having jurisdiction, the
use of the Aircraft or Airframe in the normal course of air transportation
of cargo shall have been prohibited by virtue of a condition affecting all
Airbus A300-600 series aircraft equipped with engines of the same make and
model as the Engines for a period of twelve (12) consecutive months, unless
the Lessee, prior to the expiration of such twelve (12) month period, shall
be diligently carrying forward all steps which are necessary or desirable
to permit the normal use of the Aircraft or Airframe or, in any event, if
such use of the Aircraft or the Airframe shall have been prohibited for a
period of twenty-four (24) consecutive months or until the end of the Term,
if earlier. The date of such Event of Loss shall be (s) the 61st day or
the 241st day, as the case may be, following loss of such property or its
use due to theft or disappearance (or the end of the Term or the Lessee's
abandonment of diligent efforts to recover such property, if earlier); (t)
the 61st day following the date of any destruction, damage beyond economic
repair or rendition of such property permanently unfit for normal use; (u)
the date of any insurance settlement on the basis of a total loss or
constructive or compromised total loss; (v) the date of any condemnation,
confiscation, seizure or requisition of title of such property; (w) the
181st day following condemnation, confiscation, seizure or requisition for
use of such property by a foreign government referred to in clause
(iii)(2)(A) above (or the end of the Term or the date of any insurance
settlement described therein, if earlier than such 181st day); (x) the
last day of the Term in the case of requisition for use of such property by
the Government; (y) the last day of the 12 month or 24 month period,
referred to in clause (iv) above (or if earlier, the end of the Term or
abandonment of the Lessee's efforts to restore the normal use of the
Aircraft). An Event of Loss with respect to the Aircraft shall be deemed
to have occurred if any Event of Loss occurs with respect to the Airframe.
If an Event of Loss described in any of clauses (i) (A), (iii) or (iv)
above shall occur, Lessor may elect, within 30 days following the date upon
which such Event of Loss is deemed to have occurred, to waive such Event of
Loss and the consequences thereof.
Excepted Payments. Collectively, (i) indemnity, expense,
reimbursement or other payments paid or payable by the Lessee in respect of
the Owner Participant, the Owner Trustee in its individual capacity or any
of their respective successors, permitted assigns, directors, officers,
employees, servants and agents or Affiliates, pursuant to the Participation
Agreement or any other Operative Agreement or any indemnity hereafter
granted to the Owner Participant or the Owner Trustee in its individual
capacity pursuant to the Lease or the Participation Agreement, (ii)
proceeds of public liability insurance (or government indemnities in lieu
thereof) in respect of the Aircraft payable as a result of insurance claims
paid for the benefit of, or losses suffered by, the Owner Trustee or the
Indenture Trustee in their respective individual capacities or by the Owner
Participant, or their respective successors, permitted assigns or
Affiliates, (iii) proceeds of insurance maintained with respect to the
Aircraft by the Owner Participant (whether directly or through the Owner
Trustee) maintained in accordance with Section 13.05 of the Lease but not
required under Article 13 of the Lease, (iv) payments of Supplemental Rent
by the Lessee in respect of any amounts payable under the Tax Indemnity
Agreement, (v) any purchase price paid to the Owner Participant for its
interest in the Trust Estate pursuant to Section 7.03(d) of the
Participation Agreement, (vi) subject to Section 3.05 of the Lease,
payments constituting increases in Basic Rent attributable to payments
arising pursuant to Section 5 of the Tax Indemnity Agreement, (vii) any
payments in respect of interest to the extent attributable to payments
referred to in clauses (i) through (vi) above and (viii) any right to
demand, collect or otherwise receive and enforce the payment of any amount
described in clauses (i) through (v) and (vii) above (except with respect
to interest attributable to payments referred to in clause (vi) above).
Expense; Expenses. Have the meaning specified in Section 9.01(a) of
the Participation Agreement.
FPO Price. Has the meaning set forth in Section 4.02(a)(F) of the
Lease.
FSBU. First Security Bank of Utah, National Association, a national
banking association.
Fair Market Renewal Term. A term with respect to which the Lessee
has exercised its option to renew the Lease pursuant to the second
paragraph of Section 4.01(a) thereof and with respect to which the
conditions set forth in such Section 4.01(a) are met.
Fair Market Rental. An amount determined on the basis of, and
equal in amount to, the rental which would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and
willing lessor unaffiliated with such lessee, neither being under any
compulsion to lease. In such determination, it shall be assumed that the
Aircraft is in the condition required under the Lease in the case of return
of the Aircraft pursuant to Article 12 of the Lease and Fair Market Rental
shall be determined in accordance with the provisions of Section 4.03 of
the Lease.
Fair Market Value. An amount determined on the basis of, and
equal in amount to, the value which would be obtained in an arm's-length
transaction between an informed and willing purchaser under no compulsion
to buy and an informed and willing seller unaffiliated with such purchaser
and under no compulsion to sell, assuming the Aircraft (or other property)
is unencumbered by the Lease. In such determination, except for purposes
of Section 17.01 of the Lease (when it shall be determined based upon the
actual condition and location of the Aircraft), it shall be assumed that
the Aircraft is in the condition required under the Lease in the case of
return of the Aircraft pursuant to Article 12 of the Lease and Fair Market
Value shall be determined in accordance with the provisions of Section 4.03
of the Lease.
Federal Aviation Administration; FAA. The United States Federal
Aviation Administration and any successor agency or agencies thereto.
Fixed Renewal Rent. Semi-annual payments of rent during the Fixed
Renewal Term equal to the lesser of (i) Fair Market Rental as determined
as of the commencement of such Fixed Renewal Term and (ii) 50% of the
average actual semi-annual Basic Rent payable during the Basic Term.
Fixed Renewal Term. The term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the first paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth in
such Section 4.01(a) are met.
French Pledge Agreement. The French Pledge Agreement dated as of
May 15, 1996 between the Owner Trustee and the Indenture Trustee.
Government. The United States of America or an agency or
instrumentality thereof the obligations of which bear the full faith and
credit of the United States of America.
GTA. The General Terms Agreement dated as of July 3, 1991 between
the Engine Manufacturer and the Lessee related to the purchase by the
Lessee of the Engines as originally executed or as modified, amended or
supplemented in accordance with the terms thereof, but only insofar as the
General Terms Agreement relates to the Engines, to the extent assigned to
the Owner Trustee pursuant to the Engine Warranty Assignment.
Holder of a Certificate; Certificate Holder; Holder. As of any
particular time, the Person in whose name a Certificate shall be registered
(but not including the holder of any Pass Through Certificate).
Indemnitee. Each of FSBU, in its individual capacity and as Owner
Trustee and Lessor, the Agent (to the extent set forth in Articles 8 and 9
of the Original Participation Agreement), the Owner Participant, the
Original Loan Participants (to the extent set forth in Articles 8 and 9 of
the Original Participation Agreement), the Indenture Trustee, in its
individual capacity and as trustee, any Owner Participant Guarantor, and
any successor (including any trustee which may succeed to the Lessor's
interest under the Lease), Affiliate, assign, officer, director, employee,
agent and servant of any of the foregoing, the Lessor's Estate and the
Trust Indenture Estate. Neither the Certificate Holder nor any holder of a
Pass Through Certificate shall be deemed to be an Indemnitee.
Indenture. The Trust Indenture and Security Agreement (Federal
Express Corporation Trust No. N668FE), dated as of May 15, 1996, as
amended and restated as of June 1, 1996, between the Lessor and the
Indenture Trustee, as supplemented by the Indenture and Security Agreement
Supplement, and as said Indenture may from time to time be further
supplemented or amended, including any amendment or supplement thereto
entered into from time to time pursuant to the applicable provisions of the
Indenture.
Indenture and Security Agreement Supplement. The Indenture and
Security Agreement Supplement No. 1 (Federal Express Corporation Trust No.
N668FE) dated May 24, 1996, as such Indenture and Security Agreement
Supplement shall be amended or supplemented from time to time and any other
supplement to the Indenture, substantially in the form of Exhibit A to the
Indenture.
Indenture Default. Any event or condition which, with the lapse
of time or the giving of notice, or both, would constitute an Indenture
Event of Default.
Indenture Documents. Has the meaning specified in the Granting
Clause of the Indenture.
Indenture Event of Default. Each of the events specified in Section
7.01 of the Indenture.
Indenture Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, not in its individual capacity but solely as
Indenture Trustee under the Indenture and each other Person which may from
time to time be acting as successor trustee under the Indenture.
Indenture Trustee's Liens. Any Lien on the Trust Indenture Estate
resulting from (i) claims against the Indenture Trustee not related to the
administration of the Trust Indenture Estate or any transactions pursuant
to the Indenture or any document included in the Trust Indenture Estate,
(ii) any act or omission of the Indenture Trustee which is not related to
the transactions contemplated by the Operative Agreements or is in
violation of any of the terms of the Operative Agreements or (iii) Taxes
imposed against the Indenture Trustee in its individual capacity in respect
of which the Lessee has not indemnified (and is not obligated to indemnify)
the Indenture Trustee in such capacity.
Independent Appraisal. An appraisal conducted pursuant to Section
4.03 of
the Lease.
Independent Investment Banker. An independent investment banking
institution of national standing appointed by the Lessee that is
independent in fact, does not have any direct financial interests, 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 Trustee shall not have received written notice of such an
appointment at least 10 days prior to the Prepayment Date, "Independent
Investment Banker" shall mean such an institution appointed by the
Indenture Trustee.
Interim Term. The period commencing on the Delivery Date and ending
at the end of the day immediately preceding the Commencement Date.
Invoice. The invoice for the Aircraft given by AVSA to the Lessor.
Lease. The Lease Agreement (Federal Express Corporation Trust No.
N668FE) dated as of May 15, 1996, as amended and restated as of June 1,
1996, entered into by the Lessor and the Lessee concurrently with the
execution and delivery of the Indenture, as said Lease may from time to
time be supplemented or amended, or its terms waived or modified, to the
extent permitted by, and in accordance with, the terms of the Indenture,
including, without limitation, supplementation by one or more Lease
Supplements entered into pursuant to the applicable provisions of the
Lease.
Lease Supplement. The Lease Supplement No. 1 (Federal Express
Corporation Trust No. N668FE) dated May 24, 1996, as such Lease Supplement
shall be amended or supplemented from time to time and any other supplement
to the Lease, substantially in the form of Exhibit A to the Lease.
Lease Term. The period commencing on the Delivery Date and ending
at the end of the Basic Term.
Lessee. Federal Express Corporation, a Delaware corporation, and
its successors and permitted assigns.
Lessee Documents. Has the meaning set forth in Section 6.01(b) of
the Participation Agreement.
Lessor. First Security Bank of Utah, National Association, a
national banking association, not in its individual capacity but solely as
Owner Trustee under the Trust Agreement, and its successors and permitted
assigns.
Lessor's Estate. All estate, right, title and interest of the
Owner Trustee in and to the Aircraft, the Lease, any Lease Supplement, the
Participation Agreement, AVSA's FAA Bill of Sale, AVSA's Warranty Bill of
Sale, the Airbus Guaranty, the Purchase Agreement, the Purchase Agreement
Assignment, the Consent and Agreement, the AVSA Consent and Agreement, the
Consent and Guaranty (to the extent assigned by the Purchase Agreement
Assignment), any Ancillary Agreement, the GTA, the Engine Warranty
Assignment, the Engine Consent, any warranty with respect to the Airframe
and the Engines, all amounts of Basic Rent and Supplemental Rent, including
without limitation, insurance proceeds (other than insurance proceeds
payable to or for the benefit of the Owner Trustee in its individual
capacity or the Owner Participant) and requisition, indemnity or other
payments of any kind for or with respect to the Aircraft (except amounts
owing to the Owner Participant, to the Indenture Trustee, to the Owner
Trustee in its individual capacity, or to any of their respective
directors, officers, employees and agents pursuant to Articles 8 and 9 of
the Participation Agreement), and all other property of the Owner Trustee
purportedly subjected to the Lien of the Indenture by the Granting Clause
thereof; provided that in no event shall "Lessor's Estate" include any
Excepted Payment.
Lessor's Liens. Liens on the Lessor's Estate or the Trust
Indenture Estate arising as a result of (i) claims against the Lessor, in
its individual capacity or as Owner Trustee, or the Owner Participant, in
each case not related to the transactions contemplated by the Operative
Agreements, (ii) acts or omissions of the Lessor in its individual capacity
or as Owner Trustee, and, in the case of the Lessor in its individual
capacity, arising from its gross negligence or willful misconduct or
expressly prohibited under the Operative Agreements and any act or omission
of the Owner Participant which is in violation of any of the terms of the
Operative Agreements, (iii) Taxes or Expenses imposed against the Lessor,
in its individual capacity or as Owner Trustee, Owner Participant, Lessor's
Estate or the trust created by the Trust Agreement which are not required
to be indemnified against by the Lessee pursuant to the Participation
Agreement by reason of Section 8.01(b) or 9.01(b) thereof and which are not
required to be indemnified against by the Lessee pursuant to the Tax
Indemnity Agreement, or (iv) claims against the Lessor or the Owner
Participant arising from the voluntary transfer by the Lessor or the Owner
Participant of its interests in the Aircraft other than a transfer of the
Aircraft pursuant to Section 4.02(a) or Article 10 or 11 of the Lease and
other than a transfer pursuant to the exercise of the remedies set forth in
Article 17 of the Lease.
Lien. Any mortgage, pledge, lien, charge, encumbrance, lease or
security interest or other similar interest.
Loss Payee. Has the meaning specified in Section 13.02(b)(i) of the
Lease.
Majority in Interest of Certificate Holders. As of a particular
date of determination, the Holders of more than 50% of the aggregate unpaid
principal amount of all Certificates outstanding as of such date excluding
for purposes of this definition any Certificates held by (i) the Owner
Trustee or the Owner Participant or any interests of the Owner Participant
unless all Certificates then outstanding shall be held by the Owner
Participant, (ii) the Lessee or (iii) any Affiliate of any thereof.
Make-Whole Premium. An amount determined as of the day before the
applicable Prepayment Date (or date of purchase, as the case may be) which
an Independent Investment Banker determines to be equal to the excess, if
any, of (i) the present values of all remaining scheduled payments of such
principal amount or portion thereof and interest thereon (excluding
interest accrued from the immediately preceding Payment Date to such
Prepayment Date or date of purchase, as the case may be) to the Maturity of
such Certificate in accordance with generally accepted financial practices
assuming a 360-day year consisting of twelve 30-day months at a discount
rate equal to the Treasury Yield, all as determined by the Independent
Investment Banker over (ii) the unpaid principal amount of such
Certificate.
Manufacturer. Airbus Industrie G.I.E., a groupement d'interet
economique formed under the laws of France, and its successors and assigns.
Maturity. With respect to any Certificate, the date on which the
final principal amount of such Certificate is scheduled to be due and payable.
Moody's. Moody's Investors Service, Inc.
Net Present Value of Rents. The net present value, as of the
Delivery Date, of Basic Rent set forth in Schedule II of the Lease,
discounted at a rate equal to the Debt Rate per annum compounded semi-
annually.
Non-U.S. Person. Any Person other than a U.S. Person.
Obsolete Parts. Parts which are severable from the Aircraft in
accordance with clauses (ii) and (iii) of the proviso to Section 9.02(b) of
the Lease and the Lessee in good faith determines to be obsolete or no longer
suitable or appropriate for use on the Airframe or any Engine.
Officer's Certificate. When delivered pursuant to the Indenture,
a certificate signed by a Responsible Officer of the Lessee or the Owner
Trustee, as the case may be, and delivered to the Indenture Trustee. Each
such certificate shall include the statements provided for in Section 15.07
of the Indenture.
Operative Agreements. The Participation Agreement, the Trust
Agreement, AVSA's FAA Bill of Sale, AVSA's Warranty Bill of Sale, the
Airbus Guaranty, the Purchase Agreement, the Purchase Agreement Assignment,
the GTA, the Engine Warranty Assignment, the French Pledge Agreement, the
Lease, the Lease Supplement, the Owner Participant Guaranty, if any, the
Owner Trustee Guaranty, if any, any Ancillary Agreement entered into by or
with the written consent of the Indenture Trustee, which by its terms is an
Operative Agreement, the Certificates outstanding at the time of reference,
the Indenture, the Indenture and Security Agreement Supplement, the Consent
and Agreement, the AVSA Consent and Agreement, the Consent and Guaranty (to
the extent assigned by the Purchase Agreement Assignment), the Engine
Consent, the Tax Indemnity Agreement and any Assignment and Assumption
Agreement, each as amended from time to time.
Opinion of Counsel. When delivered pursuant to the Indenture, 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) Davis Polk & Wardwell 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 or the Indenture Trustee, an attorney selected by such Person and,
in the case of the Owner Trustee, reasonably satisfactory to the Indenture
Trustee.
Original Agreements. The documents and instruments delivered on
the Delivery Date in connection with the transactions contemplated by the
Original Participation Agreement.
Original Ancillary Agreement I. The Ancillary Agreement I
(Federal Express Corporation Trust No. N668FE), among the Lessee, the
Owner Participant, the Indenture Trustee and the Owner Trustee as it was
originally executed on the Delivery Date.
Original Indenture. The Trust Indenture, Mortgage and Security
Agreement (Federal Express Corporation Trust No. N668FE), dated as of May
15, 1996, between the Owner Trustee and the Indenture Trustee, which
together with the Indenture and Security Agreement Supplement No. 1
(Federal Express Corporation Trust No. N668FE), dated May 24, 1996
attached thereto was recorded as one instrument by the FAA on May 28, 1996
and assigned Conveyance Number VV009331.
Original Lease. The Lease Agreement (Federal Express Corporation
Trust No. N668FE), dated as of May 15, 1996, between the Owner Trustee as
lessor, and the Lessee, which together with Lease Supplement No. 1 (Federal
Express Corporation Trust No. N668FE), dated May 24, 1996 attached thereto
was recorded as one instrument by the FAA on May 28, 1996 and assigned
Conveyance Number VV009332.
Original Loan Certificates. The loan certificates issued on the
Delivery Date to the Original Loan Participants.
Original Loan Participants. The entities listed on Schedule I to
the Original Participation Agreement and their successors and assigns
(other than any assignees in connection with the Refunding Date).
Original Participation Agreement. The Participation Agreement
(Federal Express Corporation Trust No. N668FE), among the Lessee, the Owner
Participant, the Indenture Trustee, the Owner Trustee and the Original Loan
Participants as it was originally executed as of May 1, 1996.
Original Tax Indemnity Agreement. The Tax Indemnity Agreement
(Federal Express Corporation Trust No. N668FE) between the Lessee and the
Owner Participant as it was originally executed as of May 15, 1996.
Original Trust Agreement. The Trust Agreement (Federal Express
Corporation Trust No. N668FE) between the Owner Participant and the Owner
Trustee as it was originally executed as of May 1, 1996 and filed with the
FAA on May 24, 1996.
Outstanding. When used with respect to Certificates, as of the date
of determination and subject to the provisions of Section 10.04 of the
Indenture, all Certificates theretofore executed and delivered under the
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 the Indenture or otherwise;
(ii) Certificates for which prepayment 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 of the
Indenture; provided, that if such Certificates are to be prepaid,
notice of such prepayment has been duly given pursuant to the
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 and delivered pursuant to Article II
of the Indenture.
Owner Participant. The trustor originally named in the Trust
Agreement and any successor thereto, and any Person to which Owner
Participant transfers, in accordance with the Trust Agreement, its right,
title and interest in and to the Operative Agreements and the Lessor's
Estate.
Owner Participant Amount. The amount described in Section 2.03 of
the Participation Agreement and set forth on Schedule II to the Lease.
Owner Participant Guarantor. The provider of an Owner Participant
Guaranty.
Owner Participant Guaranty. Any guaranty delivered in compliance
with Section 7.03(d) of the Participation Agreement.
Owner Trustee. FSBU, not in its individual capacity except as
otherwise expressly stated, but solely as Owner Trustee under the Trust
Agreement, and its successors and permitted assigns.
Owner Trustee Guarantor. The provider of an Owner Trustee Guaranty.
Owner Trustee Guaranty. Any guaranty delivered in compliance with
Section 11.01(b)(ii) of the Participation Agreement.
Owner's Economic Return. The Owner Participant's anticipated net
after-tax book yield and aggregate after-tax cash during the Interim Term and
the Basic Term utilizing the multiple investment sinking fund method of
analysis, computed on the basis of the same methodology and assumptions as
were utilized by the Owner Participant in determining Basic Rent, Stipulated
Loss Value and Termination Value percentages, as the case may be, as such
assumptions may be adjusted for events which have been the basis of
adjustments to Rent pursuant to Section 3.04 of the Lease.
Participation Agreement. The Participation Agreement (Federal
Express Corporation Trust No. N668FE), dated as of May 1, 1996, as amended
and restated as of June 1, 1996, among the Lessee, the Original Loan
Participants, the Owner Trustee not in its individual capacity except as
otherwise expressly provided therein, but solely as owner trustee, the
Owner Participant, the Indenture Trustee not in its individual capacity
except as otherwise expressly provided therein, but solely as indenture
trustee and the Pass Through Trustee not in its individual capacity except
as otherwise expressly provided therein, but solely as pass through
trustee, as amended, modified or supplemented, or the terms thereof waived.
Parts. All appliances, parts, components, instruments,
appurtenances, accessories, furnishings and other equipment of whatever
nature (other than complete Engines or engines) which may from time to time
be incorporated or installed in or attached to the Airframe or any Engine
or title to which remains vested in the Lessor pursuant to Article 8 of the
Lease.
Pass Through Agreement. The Pass Through Trust Agreement dated as
of February 1, 1993, as amended and restated as of October 1, 1995 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 Certificates. Any of the 1996 Pass Through
Certificates, Series A1 or 1996 Pass Through Certificates, Series A2, in
each case as issued by the related Pass Through Trust; and "Pass Through
Certificates" means both of the Pass Through Certificates issued by each of
the Pass Through Trusts.
Pass Through Closing Date. The Business Day on which the sale of
the Pass Through Certificates to the Underwriters pursuant to the
Underwriting Agreement takes place.
Pass Through Trust. The Federal Express Pass Through Trust,
1996-A1 or Federal Express Pass Through Trust, 1996-A2, in each case formed
pursuant to the related Series Supplement in accordance with the Pass
Through Agreement; and "Pass Through Trusts" means both of such Pass
Through Trusts.
Pass Through Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, in its capacity as Pass Through Trustee under
the Pass Through Agreement and each Pass Through Trust, and its successors
and permitted assigns as Pass Through Trustee thereunder.
Past Due Rate. In respect of (A) any amount payable to the Owner
Participant or the Owner Trustee a rate per annum during the period from
and including the due date to but excluding the date on which such amount
is paid in full equal to 2% plus the Debt Rate and (B) any principal of or
interest on any Certificate or any other amount payable under the
Indenture, any Certificate or any other Operative Agreement that is not
paid when due (whether at Maturity, by acceleration, by optional or
mandatory prepayment or otherwise) to any Holder, the Indenture Trustee or
the Pass Through Trustee, a rate per annum during the period from and
including the due date to but excluding the date on which such amount is
paid in full equal to (i) in the case of any such amount payable to the
Holder of any Certificate, 2% plus the interest rate applicable to such
Certificate and (ii) in the case of any other such amount, 2% plus the Debt
Rate.
Payment Date. August 24, 2019 and each January 30 and July 30
commencing on July 30, 1996.
Payment Default. Any event specified in Section 16.01(a) or 16.01(b)
of the Lease which with the giving of notice or lapse of time or both would
constitute an Event of Default.
Permitted Investments. Those investments enumerated in Section
23.01(a) (i), (ii), (iii) and (iv) of the Lease.
Person. Any individual, sole proprietorship, partnership, joint
venture, joint stock company, trust, unincorporated organization, association,
corporation, institution, entity or government (federal, state, local, foreign
or any agency, instrumentality, division or body thereof).
Preliminary Notice. Has the meaning specified in Section 4.01(a) of
the Lease.
Premium Termination Date. With respect to the Certificates having a
Maturity in 2015, June 11, 2008 and with respect to the Certificates
having a Maturity in 2018, November 24, 2016.
Prepayment Date. Has the meaning specified in Section 6.02(b) of the
Indenture.
Prepayment Price. Has the meaning specified in Section 6.02(b) of
the Indenture.
Property. Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or
intangible.
Proposed Termination Date. The proposed date of termination of
the Lease as specified by the Lessee in its notice given pursuant to
Section 10.01 thereof.
Purchase Agreement. The Airbus A300-600R Freighter Purchase
Agreement, dated as of July 3, 1991 between AVSA and the Lessee, including
all exhibits, appendices and letter agreements attached thereto as
originally executed or as modified, amended or supplemented in accordance
with the terms thereof, but only to the extent that the foregoing relates
to the Aircraft and to the extent assigned pursuant to the Purchase
Agreement Assignment.
Purchase Agreement Assignment. The Purchase Agreement Assignment
(Federal Express Corporation Trust No. N668FE), dated as of May 15, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
Purchase Price. The amount specified as such in Ancillary Agreement
I.
Record Date. With respect to Payment Dates under the Indenture
(except a date for payment of defaulted interest), January 15 for January 30
Payment Dates and July 15 for July 30 Payment Dates, whether or not such date
is a Business Day.
Recourse Amount. Has the meaning specified in Section 17.10 of the
Participation Agreement.
Refinancing. A non-recourse loan to the Lessor arranged pursuant to
Section 15.01 of the Participation Agreement.
Refunding Date. A Business Day on which the refunding of the
Original Loan Certificates occurs, the expected date thereof having been
specified by the Lessee in a written notice given to the parties to the
Participation Agreement and the Underwriters at least three (3) Business Days
prior to such expected Refunding Date.
Register. Has the meaning set forth in Section 3.02 of the
Indenture.
Registrar. Has the meaning set forth in Section 3.02 of the
Indenture.
Regulation D. Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
Remaining Weighted Average Life. 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 payment is scheduled to
be made, by (b) the then outstanding principal amount of such Certificate.
Renewal Rent. The amount payable by the Lessee as rent in accordance
with Section 4.01 of the Lease during any Renewal Term.
Renewal Term. One or more terms with respect to which the Lessee has
exercised its option to renew the Lease pursuant to Section 4.01(a) thereof.
Rent. All payments due from the Lessee under the Lease as Basic
Rent, Renewal Rent and Supplemental Rent, collectively.
Rent Payment Date. August 24, 2019 and each January 30 and July 30
commencing on July 30, 1996.
Reoptimization Date. Has the meaning specified in Section 15.02(a)
of the Participation Agreement.
Replacement Aircraft. Any aircraft substituted for the Aircraft
pursuant to Section 11.03(a) of the Lease.
Replacement Airframe. Has the meaning set forth in Section 11.03 of
the Lease.
Replacement Engine. A General Electric CF6-80C2-A5F engine (or an
engine of the same or another manufacturer) of equal or greater value,
airworthiness, remaining useful life and utility as the Engine being replaced,
together with all Parts relating to such engine; provided, however, that if
such replacement engine is not a General Electric CF6-80C2-A5F engine, such
replacement engine must then be commonly used in the commercial aviation
industry on Airbus A300-600 airframes.
Responsible Officer. With respect to the Owner Trustee (except
for purposes of the Trust Agreement in which case the definition of
Responsible Officer set forth in Section 3.10 of the Trust Agreement is
applicable) or the Indenture Trustee, any officer in its Corporate Trust
Administration, as the case may be, designated by such Person to perform
obligations under the Operative Agreements, and with respect to any other
party, any corporate officer or (except in the case of the Owner
Participant) other employee of a party who, in the normal performance of
his or her operational responsibilities, with respect to the subject matter
of any covenant, agreement or obligation of such party pursuant to any
Operative Agreement, would have responsibility for and knowledge of such
matter and the requirements of any Operative Agreement with respect
thereto.
S&P. Standard & Poor's Ratings Group.
SEC. The Securities and Exchange Commission of the United States
and any successor agencies or authorities.
SSB. State Street Bank and Trust Company, a Massachusetts trust
company.
Securities Act. The Securities Act of 1933, as amended.
Series Supplement. The Series Supplement 1996-A1 to be executed
and delivered by the Lessee and the Pass Through Trustee or the Series
Supplement 1996-A2 to be executed and delivered by the Lessee and the Pass
Through Trustee, in each case as such Series Supplement may be modified,
supplemented or amended from time to time in accordance with the provisions
thereof and "Series Supplements" means both such Series Supplements.
Sinking Fund Redemption Date. Has the meaning specified in Section
6.06 of the Indenture.
Sinking Fund Redemption Price. Has the meaning specified in Section
6.06 of the Indenture.
Special Aviation Counsel. Daugherty, Fowler & Peregrin.
Stipulated Loss Value. As of any Stipulated Loss Value
Determination Date during the Basic Term, the amount determined by
multiplying the Purchase Price by the percentage set forth in Schedule III
of the Lease under the heading "Stipulated Loss Value Factor" opposite such
date (as such Schedule III may be adjusted from time to time as provided in
Section 3.04 of the Lease), and during any Renewal Term, the amount
determined pursuant to Section 4.01(b) of the Lease. Notwithstanding any
other provisions of the Lease or the Participation Agreement or the
Indenture, each Stipulated Loss Value for the Aircraft shall be, under any
circumstances and in any event, an amount, together with so much of the
arrears portion of Basic Rent due and owing through the date of payment of
Stipulated Loss Value as does not constitute an Excepted Payment, at least
sufficient to pay in full as of such date of payment the aggregate unpaid
principal amount of and accrued interest on the Certificates outstanding on
such date of payment. Subject to the immediately preceding sentence, it is
understood and agreed that the amounts set forth on Schedule III of the
Lease, for dates other than Rent Payment Dates on which arrears Basic Rent
is due, fully reflect appropriate Basic Rent accruals and credits of
unearned Basic Rent through such date and, accordingly, no further accrual
or credit shall be required through such date whenever Stipulated Loss
Value is to be calculated with reference to any such date; provided that if
amounts in respect of Stipulated Loss Value are payable under the Operative
Agreements after the Stipulated Loss Determination Date in respect of which
such Stipulated Loss Value was determined, the Lessor shall be compensated
during the period from the Stipulated Loss Determination Date to such
payment date in accordance with the provisions of the Operative Agreements.
Stipulated Loss Value Determination Date. Each date set forth on
Schedule III of the Lease under the heading "Stipulated Loss Value Date."
Supplemental Rent. All amounts, liabilities and obligations which
the Lessee assumes or agrees to perform or pay under the Lease or under the
Participation Agreement or Tax Indemnity Agreement or any Ancillary
Agreement or any other Operative Agreement to the Lessor, the Owner
Participant, the Indenture Trustee or others, including, without
limitation, payments of Stipulated Loss Value, FPO Price and amounts
calculated by reference to Termination Value, any amounts of Make-Whole
Premium payable under the Indenture to the extent provided in Section 3.03
of the Lease, and all amounts required to be paid by Lessee under the
agreements, covenants and indemnities contained in the Lease or in the
Participation Agreement or the Tax Indemnity Agreement or any other
Operative Agreement, but excluding Basic Rent.
Tax. Has the meaning set forth in Section 8.01(a) of the
Participation Agreement.
Tax Indemnity Agreement. The Original Tax Indemnity Agreement as
amended by Amendment No. 1 to the Original Tax Indemnity Agreement, as from
time to time modified, amended or supplemented pursuant to its applicable
provisions.
Term. The Interim Term and the Basic Term of the lease for the
Aircraft under the Lease and, if renewed pursuant to Section 4.01 of the
Lease, each Renewal Term for the Aircraft for which the Lease is renewed, or
such earlier date on which the Lease is terminated pursuant to its terms.
Termination Date. A Rent Payment Date during the Basic Term that is
on or after December 31, 2003 in the case of Article 10 of the Lease, and in
the case of (i) Section 4.02(a)(A) of the Lease, the Rent Payment Date falling
on July 30, 2017, (ii) Section 4.02(a)(D) or (E) of the Lease, a Rent Payment
Date that is on or after the seventh anniversary of the Commencement Date and
(iii) Section 4.02(a)(F) of the Lease, the last day of the Basic Term.
Termination Value. As of any Termination Date, the amount
determined by multiplying the Purchase Price by the percentage set forth in
Schedule IV of the Lease under the heading "Termination Value Factor"
opposite such Termination Date (as such Schedule IV may be adjusted from
time to time as provided in Section 3.04 of the Lease). Notwithstanding
any other provisions of the Lease, the Participation Agreement or the
Indenture, each Termination Value shall be, under any circumstances and in
any event, an amount, together with so much of the arrears portion of Basic
Rent due and owing through the date of payment of any amount calculated by
reference to Termination Value as does not constitute an Excepted Payment,
at least sufficient to pay in full as of such date of payment the aggregate
unpaid principal amount of and accrued interest on the Certificates
outstanding on such date of payment. Subject to the immediately preceding
sentence, it is understood and agreed that the amounts set forth on
Schedule IV of the Lease, for dates other than Rent Payment Dates on which
arrears Basic Rent is due, fully reflect appropriate Basic Rent accruals
and credits of unearned Basic Rent through such date and, accordingly, no
further accrual or credit shall be required through such date whenever
Termination Value is to be calculated with reference to any such date;
provided that if amounts in respect of Termination Value are payable under
the Operative Agreements after the Termination Date in respect of which
such Termination Value was determined, the Lessor shall be compensated
during the period from the Termination Date to such payment date in
accordance with the provisions of the Operative Agreements.
Transaction Costs. Those costs and expenses set forth in Section
10.01(a) of the Participation Agreement.
Transportation Code. Title 49 of the United States Code, as
amended and in effect on the date of the Lease or as subsequently amended,
or any successor or substituted legislation at the time in effect and
applicable, and the regulations promulgated pursuant thereto.
Treasury Yield. (i) In the case of a Certificate having a
Maturity within one year after the Prepayment 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
Prepayment 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 source deemed comparable by the Independent
Investment Banker selected to determine the Make-Whole Premium and
reasonably acceptable to the Lessee) corresponding in maturity to the
Remaining Weighted Average Life of such Certificate (or, if there is no
corresponding maturity, an interpolation of maturities by the Independent
Investment Banker), in each case determined by the Independent Investment
Banker selected to determine the Make-Whole Premium based on the average of
the yields to stated maturity determined from the bid prices as of 10:00
a.m. and 2:00 p.m. New York time, on the second Business Day preceding the
Prepayment Date.
Trust Agreement. The Trust Agreement (Federal Express Corporation
Trust No. N668FE), dated as of May 1, 1996, as amended and restated as of
June 1, 1996, between the Owner Participant and the Owner Trustee in its
individual capacity, as from time to time modified, amended or supplemented
pursuant to its applicable provisions and in accordance with the Operative
Agreements.
Trust Estate. The Lessor's Estate.
Trust Indenture Act. The Trust Indenture Act of 1939, as amended.
Trust Indenture Estate. All estate, right, title and interest of
the Indenture Trustee in and to any of the property, rights, interests and
privileges granted to the Indenture Trustee pursuant to the Granting Clause
of the Indenture, other than Excepted Payments and any and all other rights
of the Owner Trustee or the Owner Participant expressly reserved to the
Owner Trustee or the Owner Participant pursuant to the Indenture.
Underwriters. Goldman, Sachs & Co., J.P. Morgan Securities Inc. and
Morgan Stanley & Co. Incorporated.
Underwriting Agreement. The Underwriting Agreement dated June 5,
1996 among the Lessee and the Underwriters.
United States, U.S. or US. The United States of America.
U.S. Air Carrier. Any United States air carrier as to which
there is in force a certificate issued pursuant to Section 41102(a) or
Section 41103 of the Transportation Code, and as to which there is in force
an air carrier operating certificate issued pursuant to Chapter 447 of the
Transportation Code and Part 121 of the regulations under such
Transportation Code, for aircraft capable of carrying ten (10) or more
individuals or 6,000 pounds or more of cargo, or which may operate as an
air carrier by certification or otherwise under any successor or substitute
provision thereof or in absence thereof.
U.S. Person. A Person described in Section 7701(a)(30) of the Code.
TRUST AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N669FE)
Dated as of June 1, 1996
between
PMCC LEASING CORPORATION,
Trustor
and
FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION,
Owner Trustee
COVERING ONE AIRBUS A300F4-605R AIRCRAFT
SERIAL NO. 774, REGISTRATION NO. N669FE
TABLE OF CONTENTS Page
----
PARTIES.................................................................... 1
RECITALS................................................................... 1
ARTICLE 1
THE LESSOR'S ESTATE
Section 1.01. Authorization and Direction to Owner Trustee............. 1
Section 1.02. Declaration of Trust..................................... 2
Section 1.03. Conditions Precedent..................................... 2
ARTICLE 2
DISTRIBUTIONS
Section 2.01. Predelivery Funding; Rent, Etc........................... 3
Section 2.02. Excepted Payments........................................ 4
Section 2.03. Other Receipts........................................... 4
Section 2.04. Distributions after Default.............................. 4
Section 2.05. Distributions after Release of Lien of Indenture......... 4
Section 2.06. Manner of Making Distributions........................... 5
ARTICLE 3
THE OWNER TRUSTEE
Section 3.01. Acceptance of Trust and Duties........................... 5
Section 3.02. Limitation on Authority of Owner Trustee................. 6
Section 3.03. Notice of Default........................................ 6
Section 3.04. Action Upon Instructions................................. 7
Section 3.05. Certain Duties and Responsibilities of Owner Trustee..... 7
Section 3.06. Certain Rights of Owner Trustee.......................... 8
Section 3.07. No Representations or Warranties as to Certain Matters... 10
Section 3.08. Status of Moneys Received................................ 11
Section 3.09. Self-Dealing............................................. 11
Section 3.10. Definition of a Responsible Officer...................... 11
Section 3.11. Resignation or Removal of Owner Trustee.................. 11
Section 3.12. Estate and Rights of Successor Owner Trustee............. 12
Section 3.13. Merger or Consolidation of FSBU.......................... 12
Section 3.14. Co-Trustees.............................................. 12
Section 3.15. Interpretation of Agreements............................. 14
Section 3.16. Not Acting in Individual Capacity........................ 14
Section 3.17. Tax Returns.............................................. 14
ARTICLE 4
TERMINATION OF TRUST
Section 4.01. Termination.............................................. 15
Section 4.02. Termination at Option of the Trustor..................... 15
Section 4.03. Distribution of Lessor's Estate upon Termination......... 16
ARTICLE 5
[INTENTIONALLY LEFT BLANK]
ARTICLE 6
MISCELLANEOUS
Section 6.01. Indemnification.......................................... 16
Section 6.02. Supplements and Amendments............................... 17
Section 6.03. Nature of Title of Trustor............................... 18
Section 6.04. Power of Owner Trustee to Convey......................... 18
Section 6.05. Notices.................................................. 18
Section 6.06. Situs of Trust; Applicable Law; Severability............. 19
Section 6.07. Successors and Assigns................................... 19
Section 6.08. Headings and Table of Contents........................... 19
Section 6.09. Identification of Trust.................................. 19
Section 6.10. Counterparts............................................. 20
Section 6.11. Trustor Interest......................................... 20
Section 6.12. Performance by the Trustor............................... 20
Schedule I Definitions
TRUST AGREEMENT
(FEDERAL EXPRESS CORPORATION TRUST NO. N669FE)
TRUST AGREEMENT (FEDERAL EXPRESS CORPORATION TRUST NO. N669FE) dated
as of June 1, 1996 (this "Agreement") between FIRST SECURITY BANK OF UTAH,
NATIONAL ASSOCIATION, a national banking association (in its individual
capacity, "FSBU", and not in its individual capacity but solely as trustee
hereunder, the "Owner Trustee"), and PMCC LEASING CORPORATION, a Delaware
corporation (together with its successors and permitted assigns, the
"Trustor"). The capitalized terms used herein, unless otherwise herein
defined or the context hereof shall otherwise require, shall have the
respective meanings set forth in Schedule I attached hereto.
W I T N E S S E T H :
WHEREAS, the Trustor desires to create a trust for the purpose of
issuing Certificates, the proceeds of which issuance shall initially be held
by the Owner Trustee in the Collateral Account and released on the Delivery
Date in order to finance a portion of the Purchase Price of the Aircraft, to
acquire the Aircraft from AVSA on the Delivery Date, to lease the Aircraft to
the Lessee on the Delivery Date and to receive the benefits provided for
herein.
WHEREAS, FSBU is willing to accept the trust as herein provided and to
perform its obligations hereunder in its individual capacity or as the Owner
Trustee as the case may be.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein, FSBU and the Trustor agree as follows:
ARTICLE 1
THE LESSOR'S ESTATE
Section 1.01. Authorization and Direction to Owner Trustee. The
Trustor hereby authorizes and directs (or has authorized and directed) the
Owner Trustee, not individually but solely as the Owner Trustee hereunder:
(a) to execute and deliver as and when specified in Sections 4.01
and 4.02 of the Participation Agreement, this Agreement and each of the
other Operative Agreements to which the Owner Trustee is a party and to
enter into and perform the transactions contemplated thereby including,
without limitation, accepting title to, and delivery of, the Aircraft from
AVSA on the Delivery Date, and taking all appropriate action to cause the
Airframe to be registered with the Federal Aviation Administration in the
name of the Owner Trustee;
(b) to execute and deliver from time to time the Certificates in the
manner and subject to the terms and conditions provided in the
Participation Agreement and the Indenture;
(c) to execute and deliver each other document referred to in the
Operative Agreements to which the Owner Trustee is a party or which the
Owner Trustee is required to deliver pursuant to the Operative Agreements;
(d) subject to the terms of this Agreement, to perform the
obligations and duties and, upon instruction of the Trustor, exercise the
rights of the Owner Trustee under the Operative Agreements; and
(e) to execute and deliver all such other instruments, documents or
certificates and take all such other actions in accordance with the
directions of the Trustor, as the Trustor may deem necessary or advisable
in connection with the Certificate Closing Date and the Delivery Date and
the transactions contemplated hereby, the taking of any such action by the
Owner Trustee in the presence of the Trustor or its counsel to evidence,
conclusively, the direction of the Trustor.
Section 1.02. Declaration of Trust. FSBU hereby declares and
agrees, in its individual capacity, that it will, and in its capacity as the
Owner Trustee does, hold the Lessor's Estate upon the trust herein set forth
for the use and benefit of the Trustor, subject, however, to the provisions
of, and the Lien to be created by, the Indenture.
Section 1.03. Conditions Precedent. The right and obligation of the
Owner Trustee to take the actions required by Section 1.01 hereof shall be
subject to the condition that the terms and conditions of Section 4.01 or
4.02, as the case may be, of the Participation Agreement shall have been
complied with in a manner satisfactory to the Owner Trustee and the Trustor.
ARTICLE 2
DISTRIBUTIONS
Section 2.01. Predelivery Funding; Rent, Etc. (a) The Trustor and
the Owner Trustee acknowledge that the proceeds from the sale of the
Certificates to be effected on the Certificate Closing Date are to be held by
the Indenture Trustee in the Collateral Account in the manner specified in the
Indenture for application as provided therein and in Section 3.02 of the
Participation Agreement.
(b) The Trustor and the Owner Trustee acknowledge that the
Lease will be security for the Certificates pursuant to the Indenture which
provides that all moneys payable by the Lessee to the Owner Trustee under the
Lease (other than Excepted Payments) are to be first paid to the Indenture
Trustee while the Lien of the Indenture is in effect, for distribution in
accordance with the terms of Article V of the Indenture. Except as otherwise
provided in Section 2.04 hereof (and except for amounts received from the
Indenture Trustee, which shall be applicable only in accordance with clause
(iii) below), the Owner Trustee shall promptly apply each payment of the Owner
Participant Amount, Rent (other than Excepted Payments), Stipulated Loss
Value, Termination Value, and any proceeds from the sale, requisition or
disposition of the Aircraft received by it as follows:
(i) prior to the release of the Lien of the Indenture, each such
payment shall be payable directly to the Indenture Trustee (and if any of
the same are received by the Owner Trustee shall, upon receipt, be paid
over to the Indenture Trustee without deduction, set off or adjustment of
any kind) for distribution in accordance with the provisions of Article V
of the Indenture; provided, that any payments received by the Owner Trustee
from (x) the Lessee with respect to FSBU's or the Owner Trustee's fees and
disbursements under this Agreement, or (y) the Trustor pursuant to Section
6.01 hereof shall not be paid over to the Indenture Trustee but shall be
retained by the Owner Trustee and applied toward the purpose for which such
payments were made;
(ii) after the release of the Lien of the Indenture, any amount
remaining after application in full in accordance with paragraph (b)(i) of
this Section 2.01 and which represents payments for which provision as to
the application thereof is made in any other Operative Agreement shall be
applied promptly to the purpose for which such payment shall have been made
in accordance with the terms of such Operative Agreement; and
(iii) after application in accordance with paragraphs (i) and (ii) of
this Section 2.01(b), or to the extent received from the Indenture Trustee
under the terms of the Indenture, the balance, if any, remaining shall be
paid to the Trustor.
Section 2.02. Excepted Payments. Notwithstanding any other provision
contained herein, all Excepted Payments at any time received by the Owner
Trustee shall be distributed promptly to the applicable Person entitled
thereto, and such payment shall not be deemed under any circumstances to be
part of the Lessor's Estate.
Section 2.03. Other Receipts. Except as otherwise provided in
Section 2.04 hereof, any payment received by the Owner Trustee, other than
those referred to in Sections 2.01 and 2.02 hereof, shall be payable prior to
the release of the Lien of the Indenture directly to the Indenture Trustee
(and if any of the same are received by the Owner Trustee shall, upon receipt,
be paid over to the Indenture Trustee without deduction, set off or adjustment
of any kind) for distribution in accordance with the provisions of Article V
of the Indenture; and following such application or release of Lien, any such
payment for which provision as to the application thereof is made in the other
Operative Agreements shall be applied promptly to the purpose for which such
payment shall have been made in accordance with the terms of the other
Operative Agreements, and any such payment received by the Owner Trustee for
which no provision as to the application thereof is made in the Operative
Agreements or in this Article 2 shall, unless the Trustor shall have otherwise
instructed the Owner Trustee in writing, be distributed promptly to the
Trustor.
Section 2.04. Distributions after Default. Subject to the
provisions of Section 2.02 hereof, (i) all payments received and amounts
realized by the Owner Trustee after an Indenture Event of Default shall have
occurred and shall be continuing and after the Certificates shall have become
or been declared due and payable pursuant to Section 7.02(b) or 7.02(c) of the
Indenture (including, without limitation, any amounts realized by the Owner
Trustee or the Trustor from the exercise of any remedies pursuant to Section
17.01 of the Lease), as well as (ii) all funds then held or thereafter
received by the Owner Trustee as part of this Trust Agreement, the Lease or
otherwise, shall be distributed to the Indenture Trustee for distribution in
accordance with the provisions of Article V of the Indenture.
Section 2.05. Distributions after Release of Lien of Indenture.
Except as otherwise provided in Sections 2.01, 2.02, 2.03 and 2.04 hereof:
(a) all payments received and amounts realized by the Owner
Trustee under the Lease or otherwise with respect to the Aircraft or
any part thereof (including, without limitation, all payments
received pursuant to Section 17.01 of the Lease and amounts realized
upon the sale or lease of the Aircraft or any part thereof after the
termination of the Lease with respect thereto), to the extent
received or realized at any time after the Lien of the Indenture
shall have been released pursuant to the terms of the Indenture, and
(b) moneys not included in paragraph (a) of this Section 2.05
remaining as part of the Lessor's Estate after the Lien of the
Indenture has been released,
shall, to the extent required, be retained by the Owner Trustee as
reimbursement for all expenses hereunder or under the Lease not theretofore
reimbursed under this Agreement, the Lease or otherwise and to which the Owner
Trustee is entitled to be reimbursed pursuant to the provisions thereof, and
any balance remaining thereafter shall be distributed to the Trustor.
Section 2.06. Manner of Making Distributions. The Owner Trustee
shall make distributions or cause distributions to be made to (i) the Trustor
pursuant to this Article 2 by transferring by wire transfer in immediately
available funds the amount to be distributed to the account set forth in the
Participation Agreement or to such other account or accounts of the Trustor as
it may designate from time to time by written notice to the Owner Trustee (and
the Owner Trustee shall use best efforts to cause such funds to be transferred
by wire transfer on the same day as received, but in any case not later than
the next succeeding Business Day), and (ii) the Indenture Trustee pursuant to
this Article 2 by paying the amount to be distributed to the Indenture Trustee
in the manner specified in the Indenture; provided, that the Owner Trustee
shall invest overnight, for the benefit of the Trustor, in investments that
would be permitted by Article 23 of the Lease (but only to the extent funds
are received on or prior to 2:00 P.M. (Eastern Time) and such investments are
available and, if such investments are not available to the Owner Trustee in
investments which, after consultation with the Trustor, the Trustor shall
direct) all funds not transferred by wire transfer on the same day as they
were received. Notwithstanding the foregoing but subject always to the
provisions of, and the Lien created by, the Indenture, the Owner Trustee will,
if so requested by the Trustor by written notice, pay in immediately available
funds any and all amounts payable by the Owner Trustee hereunder to the
Trustor as directed by the Trustor.
ARTICLE 3
THE OWNER TRUSTEE
Section 3.01. Acceptance of Trust and Duties. FSBU accepts the trust
hereby created and, subject to Section 1.03 hereof, in its capacity as the
Owner Trustee agrees to perform the same, including without limitation,
subject to Section 1.03 hereof, the actions specified in Section 1.01 hereof
as herein provided. The Owner Trustee agrees to disburse all monies that it
receives under the Operative Agreements in accordance with the terms hereof.
The Owner Trustee shall not be answerable or accountable in its individual
capacity except as a result of or arising from (a) the Owner Trustee's willful
misconduct or gross negligence (in its individual capacity or as trustee), (b)
any breach by the Owner Trustee of its representations, warranties and
covenants given in its individual capacity in this Agreement, Article 5 of the
Lease, Sections 7.02(a) and (b) and 7.04 of the Participation Agreement or its
representations, warranties and covenants given in its individual capacity in
Sections 3.05 and 3.08 of the Indenture, (c) the failure to use ordinary care
in receiving, handling and disbursing funds, (d) Lessor's Liens attributable
to it in its individual capacity, and (e) taxes, fees, or other charges on,
based on, or measured by, any fees, commissions or compensation received by
FSBU or the Owner Trustee in connection with the transactions contemplated by
the Lease, the Indenture and the Operative Agreements including this Agreement.
Section 3.02. Limitation on Authority of Owner Trustee. The Owner
Trustee shall have no power, right, duty or authority to, and agrees that it
will not, manage, control, possess, use, sell, lease, dispose of or otherwise
deal with the Aircraft, Airframe, Engines, any Part thereof or any other
property at any time constituting a part of the Lessor's Estate, or otherwise
to take or refrain from taking any action under or in connection with the
Operative Agreements, except (i) to execute and deliver the Operative
Agreements to which it is a party, (ii) to exercise and carry out or cause to
be exercised or carried out the rights, duties and obligations of the Owner
Trustee hereunder and under the other Operative Agreements, or (iii) as
expressly provided in written instructions from the Trustor given pursuant to
Section 3.03 or 3.04 hereof; provided, that nothing in this Section 3.02 shall
limit in any manner the obligations of the Owner Trustee hereunder.
Section 3.03. Notice of Default. In the event that a Responsible
Officer in the Corporate Trust Department of the Owner Trustee shall have
actual knowledge of a Default or an Event of Default, or an Indenture Default
or an Indenture Event of Default, the Owner Trustee shall give or cause to be
given to the Trustor and the Indenture Trustee prompt telephone or facsimile
notice, followed by prompt confirmation thereof by certified mail, postage
prepaid (in any event within two Business Days of the discovery thereof), in
accordance with Article 14 of the Participation Agreement, of such Default,
Event of Default, Indenture Default or Indenture Event of Default. Subject to
the terms of Section 3.06(e) hereof and the rights of the Indenture Trustee
under the Indenture, the Owner Trustee shall take such action with respect to
such Default, Event of Default, Indenture Default or Indenture Event of
Default as shall be specified in written instructions from the Trustor;
provided that the Owner Trustee shall have no duty to take any (and shall take
no) action whatsoever in the absence of written instructions from the Trustor.
For all purposes of this Agreement and the Lease, in the absence of actual
knowledge of a Responsible Officer of the Owner Trustee, the Owner Trustee
shall not be deemed to have knowledge of a Default, Event of Default,
Indenture Default or Indenture Event of Default unless notified in writing by
the Lessee, the Trustor, the Indenture Trustee or any Certificate Holder.
Section 3.04. Action Upon Instructions. Upon the written
instructions at any time and from time to time of the Trustor, the Owner
Trustee will take or refrain from taking such action, not inconsistent with
provisions of the Indenture, as may be specified in such instructions.
Section 3.05. Certain Duties and Responsibilities of Owner Trustee.
(a)(i) The Owner Trustee undertakes to perform such duties and only such
duties as are specifically set forth herein, and with the degree of care
specified in Section 3.01 hereof, and in accordance with written instructions
given by the Trustor hereunder, and no implied duties, covenants or
obligations shall be read into this Agreement, any such instructions or the
Operative Agreements against the Owner Trustee, and the Owner Trustee agrees
that it will not manage, control, possess, use, sell, lease, dispose of or
otherwise deal with the Aircraft or any part of the Lessor's Estate except as
required by the terms of the Operative Agreements, any such instructions and as
otherwise provided herein; and
(ii) in the absence of bad faith on its part, the Owner Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Owner Trustee and conforming to the requirements of this Agreement or
the other Operative Agreements, but in the case of any such certificates or
opinions which by any provisions hereof or thereof are specifically
required to be furnished to the Owner Trustee, the Owner Trustee shall be
under a duty to examine the same to determine whether or not they conform
to the requirements of this Trust Agreement or the Operative Agreements.
(b) No provision hereof shall require FSBU in its individual capacity
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it. Notwithstanding the foregoing, FSBU agrees
in its individual capacity that it will, at its own cost and expense, promptly
take such action as may be necessary to discharge duly all Lessor's Liens
attributable to it in its individual capacity and will claim no indemnity
therefor hereunder, or under the Participation Agreement or any Operative
Agreement.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Owner Trustee shall be subject to the provisions
of this Section 3.05, except that in the event of a conflict between this
Section 3.05 and Section 3.01 hereof, Section 3.01 hereof shall be controlling.
(d) The Owner Trustee will furnish to the Trustor, promptly upon
receipt thereof, duplicates or copies of all reports, notices, requests,
demands, certificates, financial statements and any other instruments
furnished to the Owner Trustee hereunder or under the other Operative
Agreements (including those furnished to the Indenture Trustee pursuant to the
terms of the Indenture) and not otherwise furnished to the Trustor.
(e) Notwithstanding anything herein to the contrary, the Owner Trustee
shall not be authorized and shall have no power to "vary the investment" of the
Trustor within the meaning of Treasury Regulations Section 301.7701-4(c)(1),
it being understood that the Owner Trustee shall have the power and authority
to fulfill its obligations under Section 2.06 hereof and Article 23 of the
Lease.
Section 3.06. Certain Rights of Owner Trustee. Except as otherwise
provided in Section 3.05 hereof:
(a) in the absence of bad faith on its part, the Owner Trustee may
rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order 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 or authorization by the Trustor or any
other party to any other Operative Agreement shall be sufficiently
evidenced by a request, direction or authorization in writing, delivered to
the Owner Trustee, and signed in the name of such party by any of the
Chairman of the Board, the President, any Vice President, the Treasurer or
Assistant Treasurer or the Secretary or Assistant Secretary or other duly
authorized officer of such party; and any resolution of the Board of
Directors or committee thereof of such party shall be sufficiently
evidenced by a copy of such resolution certified by the Secretary or an
Assistant Secretary of such party, to have been duly adopted and to be in
full force and effect on the date of such certification, and delivered to
the Owner Trustee;
(c) whenever in the administration of this Agreement the Owner Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder or under any of the
other Operative Agreements, the Owner Trustee (unless other evidence be
herein or therein specifically prescribed), absent actual knowledge of a
Responsible Officer of the Owner Trustee to the contrary, may rely in good
faith upon a certificate in writing, delivered to the Owner Trustee and
signed by any of the Chairman of the Board, the President, any Vice
President, the Treasurer or Assistant Treasurer or the Secretary or
Assistant Secretary of the Lessee, the Trustor, or the Indenture Trustee
and notice of such need for such proof or establishment shall be delivered
to the Trustor, who may advise the Owner Trustee in respect of such matter
and the Owner Trustee shall act in conformity with such advice;
(d) the Owner Trustee may exercise its powers and perform its duties
by or through such attorneys, agents and servants as it shall appoint with
due care, and it shall be entitled to rely upon the advice of counsel
reasonably selected by it with due care and shall be protected by the
advice of such counsel in anything done or omitted to be done in accordance
with such advice;
(e) the Owner Trustee shall not be under any obligation to take any
action under this Agreement or under any of the other Operative Agreements
at the request or direction of the Trustor unless the Persons making such
request or direction shall have offered to the Owner Trustee reasonable
security or indemnity against the costs, expenses and liabilities which
might be incurred by it in compliance with such request or direction; nor
shall the Owner Trustee be required to take any action deemed to impose on
the Owner Trustee any obligation to take any action, if the Owner Trustee
shall have been advised by its counsel that such action is unlawful or is
contrary to the terms of this Agreement or the other Operative Agreements;
(f) the Owner Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order or
other paper or document unless a Responsible Officer of the Owner Trustee
has actual knowledge that the facts or matters stated therein are false or
inaccurate, but the Owner Trustee in its discretion may make such further
inquiry or investigation into such facts or matters as it may see fit, and,
if the Owner Trustee shall determine to make such further inquiry or
investigation, it shall be entitled, to the same extent permitted to the
Lessor under the Lease, to examine the books and records of the Lessee to
reasonably determine whether the Lessee is in compliance with the terms and
conditions of the Lease and to examine the Aircraft, Airframe, Engines or
any Part thereof personally or by agent or attorney; and
(g) without limiting the generality of Section 3.05 hereof, except as
otherwise provided in written instructions given to the Owner Trustee by the
Trustor or as otherwise provided in the Indenture or the Participation
Agreement, the Owner Trustee shall not have any duty (i) to see to any
recording or filing of the Lease or of this Agreement or any financing
statement or other notice or document relating thereto or contemplated
under the Operative Agreements or to see to the maintenance of any such
recording or filing (other than FAA reporting requirements contained in 14
C.F.R. Sections 47.45 and 47.51), (ii) to see to any insurance on the
Aircraft or any part thereof or to effect or maintain any such insurance,
whether or not the Lessee shall be in default with respect thereto, other
than to forward to the Trustor and (to the extent provided in the
Indenture) the Indenture Trustee copies of all certificates, reports and
other written information which it receives from the Lessee pursuant to the
Lease, (iii) to see to the payment or discharge of any tax, assessment or
other governmental charges or any Lien (except any Lessor's Lien
attributable to it in its individual capacity) owing with respect to, or
assessed or levied against any part of the Lessor's Estate, (iv) to confirm
or verify any financial statements or reports of the Lessee, or (v) to
inspect the Aircraft at any time or ascertain or inquire as to the
performance or observance of any of the Lessee's covenants under the Lease.
Section 3.07. No Representations or Warranties as to Certain
Matters. NEITHER THE OWNER TRUSTEE NOR FSBU MAKES OR SHALL BE DEEMED TO HAVE
MADE (a) ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE,
AIRWORTHINESS, VALUE, CONDITION, WORKMANSHIP, DESIGN, COMPLIANCE WITH
SPECIFICATIONS, CONSTRUCTION, OPERATION, MERCHANTABILITY OR FITNESS FOR USE
FOR A PARTICULAR PURPOSE OF THE AIRCRAFT, AS TO THE ABSENCE OF LATENT OR OTHER
DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF
ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF OBLIGATIONS BASED ON
STRICT LIABILITY IN TORT, OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER,
EXPRESS OR IMPLIED, WITH RESPECT TO THE AIRCRAFT OR ANY PART THEREOF, except
that FSBU represents and warrants that on the Delivery Date the Owner Trustee
shall have received whatever right, title and interests in, to and under the
Aircraft that were conveyed to it by AVSA and FSBU represents, warrants and
covenants that at all times on and after the Delivery Date the Aircraft shall
be free of all Lessor's Liens attributable to it, and that the Owner Trustee
shall comply with the last sentence of Section 3.05(b) hereof, or (b) any
representation or warranty as to the validity, legality or enforceability of
this Agreement or any other Operative Agreement to which the Owner Trustee is
a party, or any other document or instrument, or as to the correctness of any
statement contained in any thereof, except to the extent that any such
representation, warranty or statement is expressly made herein or therein as a
representation or warranty by the Owner Trustee or FSBU and except that FSBU
hereby represents and warrants that this Agreement has been, and (assuming the
due authorization, execution and delivery of this Agreement by the Trustor)
the other Operative Agreements to which the Owner Trustee is a party have been
(or at the time of execution and delivery of any such instrument by the Owner
Trustee hereunder or pursuant to the terms of the Participation Agreement that
such an instrument will be) duly executed and delivered by one of its officers
who is or will be, as the case may be, duly authorized to execute and deliver
such instruments on behalf of the Owner Trustee and that this Agreement has
been duly authorized, executed and delivered by FSBU and (assuming due
authorization, execution and delivery of this Trust Agreement by the Trustor)
constitutes the legal, valid and binding obligation of FSBU enforceable
against it in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the rights of creditors generally and by general principles of
equity.
Section 3.08. Status of Moneys Received. All moneys received by the
Owner Trustee under or pursuant to any provision of this Agreement or any
Operative Agreement shall constitute trust funds for the purpose for which
they were paid or are held, but need not be segregated in any manner from any
other moneys except to the extent required by law and may be deposited by the
Owner Trustee under such conditions as may be prescribed or permitted by law
for trust funds, or may be invested in direct obligations of the United States.
Section 3.09. Self-Dealing. The Owner Trustee in its individual
capacity, or any corporation in or with which the Owner Trustee may be
interested or affiliated, or any officer or director of any such corporation,
may have normal commercial relations, and otherwise deal, in the ordinary
course of business, with the Lessee or any other corporation having relations
with the Lessee to the full extent permitted by law.
Section 3.10. Definition of a Responsible Officer. For purposes of
this Trust Agreement only, "Responsible Officer" when used with respect to the
Owner Trustee means the Chairman or the Vice-Chairman of the Board of
Directors, the Chairman or Vice-Chairman of the Executive Committee of the
Board of Directors, the President, any Vice President (whether or not
designated by a number or a word or words added before or after the title
"Vice President"), the Secretary, any Assistant Secretary, or any other
officer in the Corporate Trust Department of FSBU customarily performing
functions similar to those performed by any of the above designated officers.
Section 3.11. Resignation or Removal of Owner Trustee. The Owner
Trustee or any successor thereof (a) shall resign if required to do so
pursuant to Section 7.02(b) of the Participation Agreement and (b) may resign
at any time without cause by giving at least 60 days' prior written notice to
the Trustor and the Indenture Trustee, such resignation in each case to be
effective only upon the appointment of a successor trustee and the acceptance
of such appointment by such successor. In addition, the Trustor may at any
time remove the Owner Trustee without cause by an instrument in writing
delivered to the Owner Trustee and the Indenture Trustee, such removal to be
effective only upon the appointment by the Trustor of a successor Owner
Trustee and the acceptance of such appointment by such successor. Upon the
giving of notice of resignation or removal of the Owner Trustee, the Trustor
may appoint a successor Owner Trustee by an instrument signed by the Trustor.
If the Trustor shall not have so appointed a successor Owner Trustee within 30
days after such resignation or removal, the Owner Trustee, the Indenture
Trustee or the Trustor may apply to any court of competent jurisdiction to
appoint a successor Owner Trustee to act until such time, if any, as a
successor or successors shall have been appointed by the Trustor as above
provided. Any successor Owner Trustee so appointed by a court shall be
superseded by any successor Owner Trustee subsequently appointed by the
Trustor.
The appointment of any successor Owner Trustee shall be subject to the
conditions set forth in Section 11.01 of the Participation Agreement.
Section 3.12. Estate and Rights of Successor Owner Trustee. Any
successor Owner Trustee, however appointed, shall execute and deliver to the
predecessor Owner Trustee, with a copy to the Trustor and the Indenture
Trustee, an instrument accepting such appointment, in form and substance
acceptable to the predecessor Owner Trustee and the Trustor and thereupon each
successor Owner Trustee, without further act, shall become vested with all the
estates, properties, rights, powers, duties and trust of the predecessor Owner
Trustee in the trust hereunder with like effect as if originally named as an
Owner Trustee herein, but nevertheless upon the written request of such
successor Owner Trustee, such predecessor Owner Trustee shall execute and
deliver an instrument transferring to such successor Owner Trustee, upon the
trust herein expressed, all estates, properties, rights, powers, duties,
property or moneys then held by such predecessor Owner Trustee upon the trust
herein expressed. Upon any such transfer by a predecessor Owner Trustee, such
predecessor Owner Trustee shall provide the successor Owner Trustee and
Trustor an accounting of the Lessor's Estate and the trust hereunder.
Upon the appointment of any successor Owner Trustee hereunder, the
predecessor Owner Trustee will use its best efforts to cause registration of
the Aircraft included in the Lessor's Estate to be transferred upon the
records of the Aeronautics Authority or other registry where the Aircraft may
then be registered into the name of the successor Owner Trustee and shall
otherwise use its best efforts to comply, or assist the successor Owner
Trustee in complying, with the provisions of Section 11.01 of the
Participation Agreement.
Section 3.13. Merger or Consolidation of FSBU. Any corporation into
which FSBU in its individual capacity may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which FSBU shall be a party, or any corporation to which substantially all the
business of the Owner Trustee in its individual capacity may be transferred,
shall, subject to Section 11.01 of the Participation Agreement, be the Owner
Trustee under this Agreement without further act; provided, that such
corporation shall not also be the Indenture Trustee.
Section 3.14. Co-Trustees. At any time, if the Owner Trustee or the
Trustor shall deem it necessary or prudent or desirable in order to conform to
legal requirements of any jurisdiction in which any part of the Lessor's
Estate may at the time be located, the Owner Trustee by an instrument in
writing signed by it, shall appoint one or more Persons approved by the
Trustor to act as co-trustee, or co-trustees, jointly with the Owner Trustee,
or separate trustee or separate trustees (except insofar as local law makes it
necessary or prudent or desirable for any such co-trustee or separate trustee
to act alone), of all or any part of the Lessor's Estate, and to vest in such
Person or Persons, in such capacity, such title to the Lessor's Estate or any
part thereof, and such rights, powers, duties, trusts or obligations as the
Trustor may consider necessary or prudent or desirable. The Owner Trustee
shall not be liable for any act or omission of any co-trustee or separate
trustee appointed under this Section 3.14. No appointment of, or action by,
any co-trustee or separate trustee appointed under this Section 3.14 will
relieve the Owner Trustee of any of its obligations under any Operative
Agreement or otherwise affect any of the terms of the Indenture or adversely
affect the interests of the Indenture Trustee or the Certificate Holders in
the Trust Indenture Estate.
Any co-trustee or separate trustee may, at any time by an instrument
in writing, constitute the Owner 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 subject to the
conditions of this Agreement.
Every additional trustee hereunder shall be a Citizen of the United
States and, to the extent permitted by law, be appointed and act, and the
Owner Trustee and its successors shall act, subject to the following
provisions and conditions:
(A) all powers, duties, obligations and rights conferred upon the
Owner Trustee in respect of the custody, control and management of monies,
the Aircraft or documents authorized to be delivered hereunder or under the
Participation Agreement shall be exercised solely by the Owner Trustee;
(B) all other rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred or imposed upon and
exercised or performed by the Owner Trustee and such additional trustee
jointly, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed (including the holding
of title to the Lessor's Estate) the Owner 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
additional trustee;
(C) no power given to, or which is provided hereby may be exercised
by, any such additional trustee, except jointly with, or with the consent
in writing of, the Owner Trustee;
(D) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder except as otherwise provided
hereunder; and
(E) the Trustor, at any time, by an instrument in writing may remove
any such additional trustee.
Section 3.15. Interpretation of Agreements. In the event that the
Owner Trustee is unsure as to the application of any provision of this
Agreement or any other Operative Agreement or any other agreement relating to
the transactions contemplated by the Operative Agreements or such provision is
ambiguous as to its application, or is, or appears to be, in conflict with any
other applicable provision, or in the event that this Agreement or any other
Operative Agreement permits any determination by the Owner Trustee or is
silent or incomplete as to the course of action which the Owner Trustee is
required to take with respect to a particular set of facts, the Owner Trustee
shall request in writing sent in accordance with Article 14 of the
Participation Agreement instructions of the Trustor and, to the extent that
the Owner Trustee acts in good faith in accordance with any instructions
received from the Trustor, shall not be liable to any Person; provided, that
in the event that no response is made to the Owner Trustee by the Trustor
within 25 Business Days after such request, the Owner Trustee shall not be
liable to any Person for acts taken by the Owner Trustee in good faith in what
it deems to be the best interests of the Trustor or for any failure to act in
any situation described above in this Section 3.15. The provisions of this
Section 3.15 shall not be applicable to the Owner Trustee's obligations set
forth in the last sentence of Section 3.01 hereof.
Section 3.16. Not Acting in Individual Capacity. In carrying out
the trust hereby created, the Owner Trustee will act solely as trustee
hereunder and not in its individual capacity except as expressly provided
herein or in the other Operative Agreements to which it is a party; and all
Persons, other than the Trustor as provided in this Agreement, having any
claim against the Owner Trustee by reason of the transactions contemplated
hereby shall look only to the Lessor's Estate for payment or satisfaction
thereof, except to the extent provided in the last sentence of Section 3.01
hereof.
Section 3.17. Tax Returns. The Owner Trustee shall be responsible
for the keeping of all appropriate books and records relating to its receipt
and disbursement of all moneys under this Agreement or any Operative
Agreement. The Trustor shall be responsible for causing to be prepared and
filed all income tax returns required to be filed by the Trustor. The Owner
Trustee, upon request, will furnish the Trustor with all such information as
may be reasonably required or necessary from the Owner Trustee in connection
with the preparation of such tax returns and in connection with any other
filing or audit and related litigation obligations. The Owner Trustee shall be
responsible for causing to be prepared at the request of the Trustor and at
the expense of the Lessee all income tax returns required to be filed with
respect to the trust created hereby and shall execute and file such returns;
provided, however, that the Owner Trustee shall send a completed copy of each
such return to the Trustor not more than 60 nor less than 30 days prior to the
due date of such return; provided that the Owner Trustee shall have timely
received all necessary information to complete and deliver to the Trustor such
return. The Trustor, upon request, will furnish the Owner Trustee with all
such information as may be required from the Trustor in connection with the
preparation of such income tax returns.
ARTICLE 4
TERMINATION OF TRUST
Section 4.01. Termination. This Agreement and the trust created and
provided for hereby shall cease and be terminated in any one of the following
events, whichever shall first occur:
(a) The sale or other final disposition by the Owner Trustee of all
of its interest in all property constituting or included in the Lessor's
Estate and, if the Indenture shall then be in effect, the sale or other
disposition by the Indenture Trustee of all of its interest in all property
constituting or included in the Lessor's Estate, and the final disposition
by the Owner Trustee and, if the Indenture shall then be in effect, the
Indenture Trustee, of all moneys or other property or proceeds constituting
part of the Lessor's Estate in accordance with the terms hereof; or
(b) 110 years from the earlier execution of this Agreement by either
party hereto; provided, however, that if the Trust shall be or become valid
under applicable law for a period subsequent to 110 years from the earlier
execution of this Agreement by either party hereto or, without limiting the
generality of the foregoing, if legislation shall become effective
providing for the validity or permitting the effective grant of such trust
for a period, in gross, exceeding the period for which such trust is
hereinabove stated to extend and be valid, then such trust shall not
terminate as provided in the first part of this sentence but shall extend
to and continue in effect until, but only if such non-termination and
extension shall then be valid under applicable law, such time as the same
shall, under applicable law, cease to be valid.
Section 4.02. Termination at Option of the Trustor. Notwithstanding
Section 4.01 hereof, this Agreement and the trust created hereby shall
terminate and the Trust Estate shall be distributed to the Trustor, and this
Agreement shall be of no further force and effect, upon the election of the
Trustor by notice to the Owner Trustee, if such notice shall be accompanied by
the written agreement (in form and substance satisfactory to the Owner
Trustee) of the Trustor assuming all the obligations of the Owner Trustee
under or contemplated by the Operative Agreements or incurred by it as trustee
hereunder and releasing the Owner Trustee therefrom; provided, however, that
such notice may be given only after the time the Lien of the Indenture is
discharged under Section 14.01 of the Indenture unless the Trustor shall have
received the prior written consent of the Indenture Trustee to any such
termination in which case such notice may be given while the Lien of the
Indenture is outstanding.
Section 4.03. Distribution of Lessor's Estate upon Termination.
Upon any termination of this trust pursuant to the provisions of Section 4.01
hereof, the Owner Trustee shall convey the Lessor's Estate (subject to all
obligations, if any, of the Owner Trustee then existing under the Operative
Agreements to which the Owner Trustee is a party) to such purchaser or
purchasers or the Trustor, as the case may be, and for such amount and on such
terms as shall be specified in written instructions from the Trustor delivered
to the Owner Trustee prior to the date of termination; provided, that (i) if
at the time of any termination the Lease remains in force and effect, then the
Lessor's Estate shall be sold as a unit (and not in parcels) and subject to
the Lease, and (ii) in the event such written instructions are not delivered
to the Owner Trustee on or before the date of termination, the Owner Trustee
shall transfer title to the Lessor's Estate to the Trustor. Upon making such
transfer or sale and accounting for all funds which have come into its hands,
the Owner Trustee shall be entitled to receipt of any sums due and owing to
the Owner Trustee for expenses incurred pursuant hereto as set forth in
Section 2.05 hereof.
ARTICLE 5
[INTENTIONALLY LEFT BLANK]
ARTICLE 6
MISCELLANEOUS
Section 6.01. Indemnification. The Trustor and its assigns agree to
reimburse and save FSBU, in its individual capacity, harmless against any and
all loss, damage, liability, claims, demands, disbursements and expenses,
including Taxes (excluding Taxes imposed against FSBU upon or with respect to
any fees for services rendered in its capacity as Trustee hereunder) and
reasonable counsel fees which may be incurred by reason of its being the Owner
Trustee or acting hereunder or under the Operative Agreements, but solely by
reason thereof and arising out of or relating solely to this Agreement or the
other Operative Agreements or the Aircraft or the Rents and other sums payable
therefor, or by reason of any occurrence directly relating thereto while so
acting, and to secure the payment thereof, FSBU, in its individual capacity,
shall have a Lien on the Lessor's Estate and the proceeds thereof, including
income, prior to any interest therein of the Trustor and its assigns (but
subject to the rights of the Lessee under the Operative Agreements and subject
and subordinate to the Lien of the Indenture), except that FSBU shall not have
any such Lien (and the Trustor shall have no obligation) in respect of any
such loss, damage, liability, claims, demands, disbursements and expenses,
including Taxes and counsel fees, arising from or as a result of (A) FSBU's or
the Owner Trustee's willful misconduct or gross negligence (in its individual
capacity or as trustee), (B) any inaccuracy of any representation of FSBU or
any breach by FSBU of its warranties and covenants given in its individual
capacity in this Agreement, Article 5 of the Lease, Sections 7.02(a) and (b)
and 7.04 of the Participation Agreement and its representations and warranties
in Sections 3.05 and 3.08 of the Indenture or elsewhere in the Operative
Agreements, (C) the failure to use ordinary care in receiving, handling and
disbursing funds, (D) Lessor's Liens attributable to it in its individual
capacity, (E) Taxes, fees, or other charges on, based on, or measured by, any
fees, commissions or compensation received by FSBU in connection with the
transactions contemplated by the Lease, the Indenture and this Agreement, (F)
Taxes excluded from indemnification pursuant to Section 8.01(b) of the
Participation Agreement (disregarding for the purposes of this Section 6.01,
subsections (ii) and (v) of Section 8.01(b) of the Participation Agreement) or
(G) Expenses excluded from indemnification pursuant to Section 9.01(b) of the
Participation Agreement; provided, that, before asserting any right to payment
or indemnification hereunder, FSBU shall first demand its corresponding right
to payment or indemnification from the Lessee pursuant to the Participation
Agreement. It is further understood that the distribution by the Owner
Trustee of all or any part of the Lessor's Estate as provided in Section 4.02
of this Agreement shall not impair the right of FSBU to indemnity, payment and
reimbursement as herein provided. The provisions of this Section shall
continue in force and effect notwithstanding the termination of this trust or
the resignation, inability or incapacity to act or removal of the Owner
Trustee. FSBU or the Owner Trustee (in its individual capacity or as trustee,
as the case may be) agrees that it shall have no right against the Trustor or
the Trust Indenture Estate for any fee as compensation for its services
hereunder. Upon any assignment, conveyance or transfer of all of the
Beneficial Interest, the transferor Trustor shall, upon such assignment,
conveyance or transfer, be released and discharged without further act or
formality whatsoever from the indemnification obligations imposed under this
Section 6.01 arising after such transfer date.
Section 6.02. Supplements and Amendments. At any time and from time
to time, only upon the written request of the Trustor (a) FSBU and the Trustor
shall execute a supplement hereto for the purpose of adding provisions to, or
changing or eliminating provisions of, this Agreement as specified in such
request and (b) the Owner Trustee shall, subject to the provisions of Section
8.01 of the Indenture, enter into or consent to such written amendment or
modification of or supplement to any of the Operative Agreements as the
Trustor and any other necessary parties may agree to in writing and as may be
specified in such request, or execute and deliver such written waiver of the
terms of any of the Operative Agreements as may be agreed to in writing by the
Trustor and as may be specified in such request; provided, that (i) the Owner
Trustee shall not execute any such supplement, amendment, waiver or
modification without the prior written consent of the Trustor, (ii) if in the
reasonable opinion of the Owner Trustee any document required to be executed
by it pursuant to this Section adversely affects any right or duty of, or
immunity or indemnity in favor of, the Owner Trustee under this Agreement or
any other Operative Agreement, the Owner Trustee may in its discretion
decline to execute such document and (iii) any amendment or supplement to this
Agreement shall comply with the provisions of Section 7.13 of the
Participation Agreement. It shall not be necessary that any request pursuant
to this Section specify the particular form of the proposed document to be
executed pursuant to such request, but it shall be sufficient if such request
shall indicate the substance thereof. Promptly after the execution by FSBU or
the Owner Trustee of any document pursuant to this Section, the Owner Trustee
shall mail a conformed copy thereof to the Trustor, the Indenture Trustee and
the Lessee, but the failure of the Owner Trustee to mail such conformed copies
shall not impair or affect the validity of such document.
Section 6.03. Nature of Title of Trustor. The Trustor shall not
have any legal title to any part of the Lessor's Estate. No transfer, by
operation of law or otherwise, of the right, title and interest of the Trustor
in and to the Lessor's Estate or the trust hereunder shall operate to
terminate this Agreement or Lessor's Estate.
Section 6.04. Power of Owner Trustee to Convey. Any assignment,
sale, transfer or other conveyance by the Owner Trustee of the interest of the
Owner Trustee in the Operative Agreements or in the Aircraft or any part
thereof pursuant to and in compliance with the terms of this Agreement or the
Operative Agreements shall bind the Trustor and shall be effective to transfer
or convey all right, title and interest of the Owner Trustee in and to the
Operative Agreements or the right, title and interest of the Owner Trustee and
the Trustor in and to the Aircraft or such part thereof. No purchaser or
other grantee shall be required to inquire as to the authorization, necessity,
expediency or regularity of such assignment, sale, transfer or conveyance or
as to the application of any sale or other proceeds with respect thereto by
the Owner Trustee.
Section 6.05. Notices. All notices, demands, declarations and other
communications required by this Agreement shall be in writing and shall be
deemed received (a) if given by telecopier, when transmitted and the
appropriate telephonic confirmation received if transmitted on a Business Day
and during normal business hours of the recipient, and otherwise on the next
Business Day following transmission, (b) if given by certified mail, return
receipt requested, postage prepaid five Business Days after being deposited in
the United States mail, and (c) if given by FedEx service or other means, when
received or personally delivered, addressed:
If to the Owner Trustee: First Security Bank of Utah, National Association
79 South Main Street
Salt Lake City, Utah 84111
Attention: Corporate Trust Department
Telephone: (801) 246-5826
Facsimile: (801) 246-5053
If to the Trustor: PMCC Leasing Corporation
800 Westchester Avenue
Rye Brook, New York 10573-1301
Attention: Vice President Leasing
with a copy to Director, Portfolio Administration
Telephone: (914) 335-5000
Facsimile: (914) 335-1287
If to the Indenture
Trustee: State Street Bank and Trust Company
Two International Place
4th Floor
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Telephone: (617) 664-5414
Facsimile: (617) 664-5371
or as to any of the foregoing parties at such other address as such party may
designate by notice duly given in accordance with this Section to the other
parties.
Section 6.06. Situs of Trust; Applicable Law; Severability. THIS
AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF UTAH, INCLUDING ALL MATTERS OF
VALIDITY, CONSTRUCTION AND PERFORMANCE. If any provision of this Agreement
shall be invalid or unenforceable, the remaining provisions hereof shall
continue to be fully effective; provided, that such remaining provisions do not
increase the obligations or liabilities of the Owner Trustee or the Trustor.
Section 6.07. Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of, and shall be enforceable by,
the parties hereto and their respective successors and permitted assigns,
including any successive holder of the Beneficial Interest, but only to the
extent the Beneficial Interest has been transferred or assigned in accordance
with the limitations of Section 7.03(d) of the Participation Agreement.
Section 6.08. Headings and Table of Contents. The headings of the
Articles and Sections of this Agreement and the Table of Contents are inserted
for convenience only and shall not affect the meaning or construction of any
of the provisions hereof.
Section 6.09. Identification of Trust. This trust may for
convenience be referred to as the "Federal Express Corporation Trust No.
N669FE."
Section 6.10. Counterparts. This instrument may be executed in any
number of counterparts or upon separate signature pages bound together in
several counterparts, each of which when so executed shall be deemed to be an
original, and such counterparts together shall constitute and be one and the
same instrument.
Section 6.11. Trustor Interest. The Trustor has only a beneficial
interest in any specific property of this trust. No creditor of the Trustor
shall have any right to obtain possession of, or otherwise exercise legal or
equitable remedies with respect to, the property of this trust (as opposed to
the Trustor's beneficial interest in this trust).
Section 6.12. Performance by the Trustor. Any obligation of the
Owner Trustee hereunder or under any Operative Agreement or other document
contemplated herein may be performed by the Trustor and any such performance
shall not be construed as a revocation of the trust created hereby.
IN WITNESS WHEREOF, FSBU and the Trustor have caused this Agreement
to be duly executed all as of the date first above written.
PMCC LEASING CORPORATION
By:
_____________________________________
Name:
Title:
FIRST SECURITY BANK OF UTAH, NATIONAL ASSOCIATION
By:
_____________________________________
Name:
Title:
SCHEDULE I
DEFINITIONS
GENERAL PROVISIONS
The following terms shall have the following meanings for all
purposes of the Operative Agreements (other than the Pass Through Agreement
and the Series Supplements) referred to below, unless otherwise defined in an
Operative Agreement or the context thereof shall otherwise require. In the
case of any conflict between the provisions of this Schedule and the
provisions of any Operative Agreement, the provisions of such Operative
Agreement shall control the construction of such Operative Agreement.
Unless the context otherwise requires, (i) references to agreements
shall be deemed to mean and include such agreements as amended and
supplemented from time to time, and (ii) references to parties to agreements
shall be deemed to include the successors and permitted assigns of such
parties.
DEFINED TERMS:
Additional Insured. As defined in Article 13 of the Lease.
Aeronautics Authority. As appropriate, the Federal Aviation
Administration and/or the Administrator of the Federal Aviation
Administration, any successor to the former United States Civil Aeronautics
Board, or any Person, governmental department, bureau, commission or agency
located in the United States succeeding to the functions of any of the
foregoing.
Affidavits. The affidavits of citizenship of the Owner Trustee and
the Owner Participant.
Affiliate. With respect to any Person, any other Person directly or
indirectly controlling, controlled by or under common control with such
Person. For the purposes of this definition, "control" (including "controlled
by" and "under common control with") shall mean the power, directly or
indirectly, to direct or cause the direction of the management and policies of
such Person whether through the ownership of voting securities or by contract
or otherwise. In no event shall the Owner Trustee or the Lessor be deemed an
Affiliate of the Owner Participant.
After-Tax Basis. A basis such that any payment to be received by a
Person shall be supplemented by a further payment to such Person so that the
sum of the two payments, after deduction of all Taxes resulting from the
receipt or accrual of such payments, shall be equal to the payment to be
received. In the case of amounts payable to the Lessor, the Owner Participant,
or any corporate Affiliate of the Owner Participant, it shall be presumed that
such Person is at all times subject to Federal income tax at the maximum
marginal rate generally applicable to corporations from time to time and
actual state, local and foreign income taxes.
Air Carrier. Any U.S. Air Carrier and any "foreign air carrier" (as
defined in the Transportation Code) as to which there is in force a permit
granted under Section 41302 of the Transportation Code.
Airbus Guaranty. The Guaranty to be dated the Delivery Date executed
by the Manufacturer and guaranteeing AVSA's Warranty Bill of Sale.
Aircraft. The Airframe to be sold by AVSA to the Owner Trustee as
provided in the Participation Agreement and to be leased under the Lease (or
any permitted substitute airframe thereunder) together with two Engines
(whether either is an initial Engine or a Replacement Engine) whether or not
any of such initial or Replacement Engines may from time to time be installed
on such Airframe or may be installed on any other airframe or on any other
aircraft, including any aircraft substituted pursuant to Section 11.03 of the
Lease. Prior to delivery of the initial Lease Supplement, references in the
Operative Agreements (including Section 3.05 of the Participation Agreement)
to Aircraft shall mean the Airbus A300F4-605R airframe bearing FAA
Registration Number N669FE and Manufacturer's serial number 774, together with
two General Electric CF6-80C2-A5F engines bearing Manufacturer's serial
numbers 705-241 and 705-242.
Airframe. The Airbus A300F4-605R aircraft (excluding the Engines or
engines from time to time installed thereon) to be leased by the Lessor to the
Lessee pursuant to the Lease and the initial Lease Supplement and having the
United States FAA Registration Number initially and manufacturer's serial
number specified in the initial Lease Supplement, including (i) all Parts in
respect thereof and (ii) any replacement airframe which may be substituted
pursuant to Section 11.03 of the Lease.
Ancillary Agreement. Any written agreement of the Lessee to which the
Lessor is a party or to which the Lessor has consented in writing entered into
on or prior to the Delivery Date or any date thereafter in connection with the
transactions contemplated by the Operative Agreements, as such agreement may
be amended and supplemented from time to time with the consent of the Lessor
and delivered to the Owner Trustee, the Indenture Trustee, the Pass Through
Trustee and the Owner Participant.
Ancillary Agreement I. The Ancillary Agreement I (Federal Express
Corporation Trust No. N669FE), dated the Certificate Closing Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as Owner
Trustee, the Owner Participant and the Indenture Trustee not in its individual
capacity, but solely as Indenture Trustee, as originally executed or as
amended, modified or supplemented with the consent of all the parties thereto.
Ancillary Agreement II. The Ancillary Agreement II (Federal Express
Corporation Trust No. N669FE), dated the Certificate Closing Date, among the
Lessee, the Owner Trustee, not in its individual capacity, but solely as Owner
Trustee, the Owner Participant and the Indenture Trustee not in its individual
capacity, but solely as Indenture Trustee, as originally executed or as
amended, modified or supplemented with the consent of all the parties thereto.
Application. The application for registration of the Aircraft with
the FAA in the name of the Owner Trustee.
Appraisal. The report prepared by BK Associates, Inc. and to be
delivered to the Owner Participant (with an abbreviated report to the Lessee)
on the Delivery Date pursuant to Section 4.02(h) of the Participation
Agreement.
Assignment and Assumption Agreement. Any agreement delivered in
compliance with Section 7.03(d) of the Participation Agreement.
AVSA. AVSA S.A.R.L., a societe a responsabilite limitee, organized
and existing under the laws of France, and its successors and assigns.
AVSA Consent and Agreement. The Consent and Agreement dated as of
June 1, 1996, executed by AVSA, as the same may be amended, modified or
supplemented from time to time.
AVSA's FAA Bill of Sale. The bill of sale for the Airframe on AC
Form 8050-2, or such other form as may be approved by the Aeronautics
Authority, executed by AVSA in favor of the Owner Trustee and to be dated the
Delivery Date.
AVSA's Warranty Bill of Sale. The full warranty bill of sale
covering the Aircraft (and specifically referring to each Engine) executed by
AVSA as owner of the Aircraft in favor of the Owner Trustee and to be dated
the Delivery Date.
Bankruptcy Code. The Federal Bankruptcy Code of 1978, as amended, and
any successor thereto.
Bankruptcy Default. An event specified in Section 16.01(e), (f) or
(g) of the Lease which either does or, with the giving of notice or lapse of
time or both, would constitute an Event of Default.
Basic Rent. The aggregate periodic rent payable for the Aircraft
throughout the Basic Term pursuant to Section 3.02 of the Lease, adjusted
pursuant to Article 3 of the Lease.
Basic Term. The period commencing at the beginning of the day on the
Commencement Date and ending at the end of the day on September 25, 2019, or
such earlier date on which the Lease shall be terminated as provided therein.
Beneficial Interest. The interest of the Owner Participant under the
Trust Agreement.
Business Day. Any day on which commercial banks are not authorized or
required to close in New York, New York, Memphis, Tennessee and the city in
which the office or agency in the United States is maintained by the Pass
Through Trustee for the payment of the Pass Through Certificates, and after
the Lien of the Indenture is discharged, Salt Lake City, Utah.
Certificate Closing Date. The date of the closing with respect to the
purchase of Certificates by the Pass Through Trustee contemplated by Section
2.01(b) of the Participation Agreement.
Certificates. The Equipment Trust Certificates (Federal Express
Corporation Trust No. N669FE), issued by the Owner Trustee pursuant to the
Indenture and any certificate issued in exchange therefor or replacement
thereof pursuant to the Indenture.
Change in Tax Law. Any change to the Code or the Treasury regulations
promulgated thereunder or the publication of any revenue ruling, revenue
procedure or any informational release by the Internal Revenue Service or the
Department of Treasury, provided that the Owner Participant or the Lessee has
notified the other party of such change in writing prior to the Delivery Date.
Change in Tax Rate. Any amendment, modification, deletion, addition,
or change to the Code which is enacted into law after the Delivery Date which
changes the highest marginal statutory rate of Federal income tax applicable
to the Owner Participant (other than a change which is in the nature of a
minimum tax).
Citizen of the United States. A citizen of the United States as
defined in Section 40102(a)(15) of the Transportation Code, or any analogous
part of any successor or substituted legislation or regulation at the time in
effect.
Closings. The closing with respect to the acquisition of the Pass
Through Certificates by the Underwriters and the closing with respect to the
acquisition of Certificates by the Pass Through Trustee.
Code. Except as otherwise provided, the Internal Revenue Code of
1986, as amended from time to time.
Collateral Account. The deposit account established and maintained
pursuant to Section 2.13 of the Indenture.
Commencement Date. July 30, 1996.
Commitment. The amount of the Owner Participant's participation in
the Purchase Price required to be made available or paid as provided in
Section 3.02 of the Participation Agreement.
Consent and Agreement. The Consent and Agreement dated as of June 1,
1996 executed by the Manufacturer, as the same may be amended, modified or
supplemented from time to time.
Consent and Guaranty. The Consent and Guaranty of the Manufacturer
attached to the Purchase Agreement.
Corporate Trust Administration. The principal office of the
Indenture Trustee located at Two International Place, 4th Floor, Boston,
Massachusetts 02110, Attention: Corporate Trust Department, or such other
office at which the Indenture Trustee's corporate trust business shall be
administered which the Indenture Trustee shall have specified by notice in
writing to the Lessee, the Owner Participant and the Owner Trustee.
Corporate Trust Department. The principal office of the Owner Trustee
located at 79 South Main Street, Salt Lake City, Utah 84111, Attention:
Corporate Trust Department, or such other office at which the Owner Trustee's
corporate trust business shall be administered which the Owner Trustee shall
have specified by notice in writing to the Lessee, the Owner Participant and
the Indenture Trustee.
CRAF Program. Has the meaning specified in Section 7.01(f) of the
Lease.
Cut-Off Date. September 30, 1996.
Debt Portion. The amount specified as such on Schedule IV to the
Participation Agreement.
Debt Rate. The weighted average (based on Outstanding principal
amount) rate of interest on the Certificates issued pursuant to the Indenture.
Default. Any event or condition which, with the lapse of time or the
giving of notice, or both, would constitute an Event of Default.
Delivery Date. The date on which the Aircraft is delivered and sold
by AVSA to the Lessor and leased by the Lessor to the Lessee under the Lease,
which date shall also be the date of the initial Lease Supplement.
Delivery Notice. Notice of the Aircraft's Delivery Date, given by
the Lessee as provided in Section 3.01 of the Participation Agreement and
including any notice with respect to a postponed Delivery Date given by the
Lessee pursuant to Section 3.05(c) of the Participation Agreement.
Eligible Deposit Account. Either (a) a segregated account with an
Eligible Institution or (b) a segregated trust account with the corporate
trust department of a depository institution with corporate trust powers
organized under the laws of the United States or any state thereof, or the
District of Columbia, and whose deposits are insured by the Federal Deposit
Insurance Corporation, provided that such institution also must have a
combined capital and surplus of at least $100,000,000 and a rating of A or
better from the Thomson Bank Watch.
Eligible Institution. A depository institution organized under the
laws of the United States or any one of the states thereof, or the District of
Columbia, or any domestic branch of a foreign bank, which in any such case at
all times (a) has either (x) a long-term unsecured debt rating of at least Aa2
by Moody's or (y) a short-term certificate of deposit rating of P-1 by
Moody's, (b) has either (x) a long-term unsecured debt rating of a least AA by
S&P or (y) a short-term certificate of deposit rating of A-1+ by S&P and (c)
is a member of the Federal Deposit Insurance Corporation.
Engine. Each of the two General Electric CF6-80C2-A5F engines listed
by manufacturer's serial numbers in the initial Lease Supplement and leased
pursuant to the Lease, whether or not from time to time installed on the
Airframe or installed on any other airframe or on any other aircraft, and any
Replacement Engine which may from time to time be substituted for an Engine
pursuant to Section 7.02(a)(vii), 10.02(c), 10.03, 11.03, 11.04 or 12.02 of
the Lease, together with all Parts related thereto. Except as otherwise
provided, at such time as a Replacement Engine shall be so substituted and the
Engine for which the substitution is made shall be released from the Lien of
the Indenture, such replaced Engine shall cease to be an "Engine" under the
Lease. The term "Engines" means, as of any date of determination, both Engines
then leased to the Lessee pursuant to the Lease.
Engine Consent. The Engine Consent dated as of June 1, 1996, executed
by the Engine Manufacturer, as the same may be amended, modified or
supplemented from time to time.
Engine Manufacturer. General Electric Company, a New York
corporation.
Engine Warranty Assignment. The Engine Warranty Assignment (Federal
Express Corporation Trust No. N669FE), dated as of June 1, 1996 between the
Lessor and the Lessee, as the same may be amended, modified or supplemented
from time to time.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan. As defined in Section 7.06 of the Participation
Agreement.
Estimated Expense Amount. Has the meaning specified in Section
10.01(a) of the Participation Agreement.
Event of Default. Each of the events specified in Article 16 of the
Lease.
Event of Loss. Any of the following events with respect to the
Aircraft, the Airframe or any Engine: (i) loss of such property or its use (A)
for a period in excess of 60 days due to theft or disappearance or such longer
period, not to exceed 180 days from the end of such initial 60-day period, if
and so long as the location of such property is known to the Lessee and the
Lessee is diligently pursuing recovery of such property, or to the end of the
Term, if less (unless such theft or disappearance constitutes an Event of Loss
pursuant to (i)(B) or (ii) hereof) or (B) for a period in excess of 60 days
due to the destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use by Lessee for any reason whatsoever;
(ii) any damage to such property which results in an insurance settlement with
respect to such property on the basis of a total loss, or constructive or
compromised total loss; (iii) (1) condemnation, confiscation or seizure of, or
requisition of title to such property by the Government, any foreign
government or purported government or any agency or instrumentality thereof,
or (2) condemnation, confiscation, or seizure of, or requisition or taking of,
use of such property (A) by a foreign government or instrumentality or agency
of any such foreign government, for a period in excess of 180 days (or such
shorter period ending on the earlier of the expiration of the Term or on the
date on which an insurance settlement with respect to such property on the
basis of a total loss or constructive or compromised total loss shall occur)
or (B) by the Government for a period extending beyond the Term; and (iv) as a
result of any law, rule, regulation, order or other action by the Aeronautics
Authority or other governmental body having jurisdiction, the use of the
Aircraft or Airframe in the normal course of air transportation of cargo shall
have been prohibited by virtue of a condition affecting all Airbus A300-600
series aircraft equipped with engines of the same make and model as the
Engines for a period of twelve (12) consecutive months, unless the Lessee,
prior to the expiration of such twelve (12) month period, shall be diligently
carrying forward all steps which are necessary or desirable to permit the
normal use of the Aircraft or Airframe or, in any event, if such use of the
Aircraft or the Airframe shall have been prohibited for a period of
twenty-four (24) consecutive months or until the end of the Term, if earlier.
The date of such Event of Loss shall be (s) the 61st day or the 241st day, as
the case may be, following loss of such property or its use due to theft or
disappearance (or the end of the Term or the Lessee's abandonment of diligent
efforts to recover such property, if earlier); (t) the 61st day following the
date of any destruction, damage beyond economic repair or rendition of such
property permanently unfit for normal use; (u) the date of any insurance
settlement on the basis of a total loss or constructive or compromised total
loss; (v) the date of any condemnation, confiscation, seizure or requisition
of title of such property; (w) the 181st day following condemnation,
confiscation, seizure or requisition for use of such property by a foreign
government referred to in clause (iii)(2)(A) above (or the end of the Term or
the date of any insurance settlement described therein, if earlier than such
181st day); (x) the last day of the Term in the case of requisition for use of
such property by the Government; (y) the last day of the 12 month or 24 month
period, referred to in clause (iv) above (or if earlier, the end of the Term
or abandonment of the Lessee's efforts to restore the normal use of the
Aircraft). An Event of Loss with respect to the Aircraft shall be deemed to
have occurred if any Event of Loss occurs with respect to the Airframe. If an
Event of Loss described in any of clauses (i) (A), (iii) or (iv) above shall
occur, Lessor may elect, within 30 days following the date upon which such
Event of Loss is deemed to have occurred, to waive such Event of Loss and the
consequences thereof.
Excepted Payments. Collectively, (i) indemnity, expense,
reimbursement or other payments paid or payable by the Lessee in respect of
the Owner Participant, the Owner Trustee in its individual capacity or any of
their respective successors, permitted assigns, directors, officers,
employees, servants and agents or Affiliates, pursuant to the Participation
Agreement or any other Operative Agreement or any indemnity hereafter granted
to the Owner Participant or the Owner Trustee in its individual capacity
pursuant to the Lease or the Participation Agreement, (ii) proceeds of public
liability insurance (or government indemnities in lieu thereof) in respect of
the Aircraft payable as a result of insurance claims paid for the benefit of,
or losses suffered by, the Owner Trustee or the Indenture Trustee in their
respective individual capacities or by the Owner Participant, or their
respective successors, permitted assigns or Affiliates, (iii) proceeds of
insurance maintained with respect to the Aircraft by the Owner Participant
(whether directly or through the Owner Trustee) maintained in accordance with
Section 13.05 of the Lease but not required under Article 13 of the Lease,
(iv) payments of Supplemental Rent by the Lessee in respect of any amounts
payable under the Tax Indemnity Agreement, (v) any purchase price paid to the
Owner Participant for its interest in the Trust Estate pursuant to Section
7.03(d) of the Participation Agreement, (vi) subject to Section 3.05 of the
Lease, payments constituting increases in Basic Rent attributable to payments
arising pursuant to Section 5 of the Tax Indemnity Agreement, (vii) any
payments in respect of interest to the extent attributable to payments
referred to in clauses (i) through (vi) above and (viii) any right to demand,
collect or otherwise receive and enforce the payment of any amount described
in clauses (i) through (v) and (vii) above (except with respect to interest
attributable to payments referred to in clause (vi) above).
Expense; Expenses. Have the meaning specified in Section 9.01(a) of
the Participation Agreement.
FPO Price. Has the meaning set forth in Section 4.02(a)(F) of the
Lease.
FSBU. First Security Bank of Utah, National Association, a national
banking association.
Fair Market Renewal Term. A term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the second paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth in
such Section 4.01(a) are met.
Fair Market Rental. An amount determined on the basis of, and equal
in amount to, the rental which would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and willing
lessor unaffiliated with such lessee, neither being under any compulsion to
lease. In such determination, it shall be assumed that the Aircraft is in the
condition required under the Lease in the case of return of the Aircraft
pursuant to Article 12 of the Lease and Fair Market Rental shall be determined
in accordance with the provisions of Section 4.03 of the Lease.
Fair Market Value. An amount determined on the basis of, and equal in
amount to, the value which would be obtained in an arm's-length transaction
between an informed and willing purchaser under no compulsion to buy and an
informed and willing seller unaffiliated with such purchaser and under no
compulsion to sell, assuming the Aircraft (or other property) is unencumbered
by the Lease. In such determination, except for purposes of Section 17.01 of
the Lease (when it shall be determined based upon the actual condition and
location of the Aircraft), it shall be assumed that the Aircraft is in the
condition required under the Lease in the case of return of the Aircraft
pursuant to Article 12 of the Lease and Fair Market Value shall be determined
in accordance with the provisions of Section 4.03 of the Lease.
Federal Aviation Administration; FAA. The United States Federal
Aviation Administration and any successor agency or agencies thereto.
Fixed Renewal Rent. Semi-annual payments of rent during the Fixed
Renewal Term equal to the lesser of (i) Fair Market Rental as determined as of
the commencement of such Fixed Renewal Term and (ii) 50% of the average actual
semi-annual Basic Rent payable during the Basic Term.
Fixed Renewal Term. The term with respect to which the Lessee has
exercised its option to renew the Lease pursuant to the first paragraph of
Section 4.01(a) thereof and with respect to which the conditions set forth in
such Section 4.01(a) are met.
French Pledge Agreement. The French Pledge Agreement dated as of June
1, 1996 between the Owner Trustee and the Indenture Trustee.
Government. The United States of America or an agency or
instrumentality thereof the obligations of which bear the full faith and
credit of the United States of America.
GTA. The General Terms Agreement dated as of July 3, 1991 between the
Engine Manufacturer and the Lessee related to the purchase by the Lessee of the
Engines as originally executed or as modified, amended or supplemented in
accordance with the terms thereof, but only insofar as the General Terms
Agreement relates to the Engines, to the extent assigned to the Owner Trustee
pursuant to the Engine Warranty Assignment.
Holder of a Certificate; Certificate Holder; Holder. As of any
particular time, the Person in whose name a Certificate shall be registered
(but not including the holder of any Pass Through Certificate).
Indemnitee. Each of FSBU, in its individual capacity and as Owner
Trustee and Lessor, the Owner Participant, the Indenture Trustee, in its
individual capacity and as trustee, any Owner Participant Guarantor, and any
successor (including any trustee which may succeed to the Lessor's interest
under the Lease), Affiliate, assign, officer, director, employee, agent and
servant of any of the foregoing, the Lessor's Estate and the Trust Indenture
Estate. Neither the Certificate Holder nor any holder of a Pass Through
Certificate shall be deemed to be an Indemnitee.
Indenture. The Trust Indenture and Security Agreement (Federal
Express Corporation Trust No. N669FE), dated as of June 1, 1996, between the
Lessor and the Indenture Trustee, as supplemented by the Indenture and
Security Agreement Supplement, and as said Indenture may from time to time be
further supplemented or amended, including any amendment or supplement thereto
entered into from time to time pursuant to the applicable provisions of the
Indenture.
Indenture and Security Agreement Supplement. The Indenture and
Security Agreement Supplement No. 1 (Federal Express Corporation Trust No.
N669FE) to be dated the Delivery Date, as such Indenture and Security
Agreement Supplement shall be amended or supplemented from time to time and
any other supplement to the Indenture, substantially in the form of Exhibit A
to the Indenture.
Indenture Default. Any event or condition which, with the lapse of
time or the giving of notice, or both, would constitute an Indenture Event of
Default.
Indenture Documents. Has the meaning specified in the Granting
Clause of the Indenture.
Indenture Event of Default. Each of the events specified in Section
7.01 of the Indenture.
Indenture Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, not in its individual capacity but solely as
Indenture Trustee under the Indenture and each other Person which may from
time to time be acting as successor trustee under the Indenture.
Indenture Trustee's Liens. Any Lien on the Trust Indenture Estate
resulting from (i) claims against the Indenture Trustee not related to the
administration of the Trust Indenture Estate or any transactions pursuant to
the Indenture or any document included in the Trust Indenture Estate, (ii) any
act or omission of the Indenture Trustee which is not related to the
transactions contemplated by the Operative Agreements or is in violation of
any of the terms of the Operative Agreements or (iii) Taxes imposed against
the Indenture Trustee in its individual capacity in respect of which the Lessee
has not indemnified (and is not obligated to indemnify) the Indenture Trustee
in such capacity.
Independent Appraisal. An appraisal conducted pursuant to Section
4.03 of
the Lease.
Independent Investment Banker. An independent investment banking
institution of national standing appointed by the Lessee that is independent
in fact, does not have any direct financial interests, 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 Trustee shall
not have received written notice of such an appointment at least 10 days prior
to the Prepayment Date, "Independent Investment Banker" shall mean such an
institution appointed by the Indenture Trustee.
Interim Term. The period commencing on the Delivery Date and ending
at the end of the day immediately preceding the Commencement Date.
Invoice. The invoice for the Aircraft given by AVSA to the Lessor.
Lease. The Lease Agreement (Federal Express Corporation Trust No.
N669FE) dated as of June 1, 1996, entered into by the Lessor and the Lessee
concurrently with the execution and delivery of the Indenture, as said Lease
may from time to time be supplemented or amended, or its terms waived or
modified, to the extent permitted by, and in accordance with, the terms of the
Indenture, including, without limitation, supplementation by one or more Lease
Supplements entered into pursuant to the applicable provisions of the Lease.
Lease Supplement. The Lease Supplement No. 1 (Federal Express
Corporation Trust No. N669FE) to be dated the Delivery Date, as such Lease
Supplement shall be amended or supplemented from time to time and any other
supplement to the Lease, substantially in the form of Exhibit A to the Lease.
Lease Term. The period commencing on the Delivery Date and ending at
the end of the Basic Term.
Lessee. Federal Express Corporation, a Delaware corporation, and its
successors and permitted assigns.
Lessee Documents. Has the meaning set forth in Section 6.01(b) of the
Participation Agreement.
Lessor. First Security Bank of Utah, National Association, a
national banking association, not in its individual capacity but solely as
Owner Trustee under the Trust Agreement, and its successors and permitted
assigns.
Lessor's Estate. All estate, right, title and interest of the Owner
Trustee in and to the Collateral Account, the Liquid Collateral, the Aircraft,
the Lease, any Lease Supplement, the Participation Agreement, AVSA's FAA Bill
of Sale, AVSA's Warranty Bill of Sale, the Airbus Guaranty, the Purchase
Agreement, the Purchase Agreement Assignment, the Consent and Agreement, the
AVSA Consent and Agreement, the Consent and Guaranty (to the extent assigned
by the Purchase Agreement Assignment), any Ancillary Agreement, the GTA, the
Engine Warranty Assignment, the Engine Consent, any warranty with respect to
the Airframe and the Engines, all amounts of Basic Rent and Supplemental Rent,
including without limitation, insurance proceeds (other than insurance
proceeds payable to or for the benefit of the Owner Trustee in its individual
capacity or the Owner Participant) and requisition, indemnity or other
payments of any kind for or with respect to the Aircraft (except amounts owing
to the Owner Participant, to the Indenture Trustee, to the Owner Trustee in its
individual capacity, or to any of their respective directors, officers,
employees and agents pursuant to Articles 8 and 9 of the Participation
Agreement), and all other property of the Owner Trustee purportedly subjected
to the Lien of the Indenture by the Granting Clause thereof; provided that in
no event shall "Lessor's Estate" include any Excepted Payment.
Lessor's Liens. Liens on the Lessor's Estate or the Trust Indenture
Estate arising as a result of (i) claims against the Lessor, in its individual
capacity or as Owner Trustee, or the Owner Participant, in each case not
related to the transactions contemplated by the Operative Agreements, (ii)
acts or omissions of the Lessor in its individual capacity or as Owner
Trustee, and, in the case of the Lessor in its individual capacity, arising
from its gross negligence or willful misconduct or expressly prohibited under
the Operative Agreements and any act or omission of the Owner Participant
which is in violation of any of the terms of the Operative Agreements, (iii)
Taxes or Expenses imposed against the Lessor, in its individual capacity or as
Owner Trustee, Owner Participant, Lessor's Estate or the trust created by the
Trust Agreement which are not required to be indemnified against by the Lessee
pursuant to the Participation Agreement by reason of Section 8.01(b) or
9.01(b) thereof and which are not required to be indemnified against by the
Lessee pursuant to the Tax Indemnity Agreement, or (iv) claims against the
Lessor or the Owner Participant arising from the voluntary transfer by the
Lessor or the Owner Participant of its interests in the Aircraft other than a
transfer of the Aircraft pursuant to Section 4.02(a) or Article 10 or 11 of the
Lease and other than a transfer pursuant to the exercise of the remedies set
forth in Article 17 of the Lease.
Lien. Any mortgage, pledge, lien, charge, encumbrance, lease or
security interest or other similar interest.
Liquid Collateral. All amounts and securities deposited from time to
time in the Collateral Account and all the products, investments, earnings and
proceeds of the foregoing, including, but not limited to, all proceeds of the
investment or conversion thereof, voluntary or involuntary, into cash,
Specified Investments or other property, all rights to payment of any and
every kind, and other forms of obligations, and instruments and other property
which at any time constitute all or part or are included in the proceeds of
any of the foregoing.
Losses. Has the meaning specified in Section 17.02(a) of the
Participation Agreement.
Loss Payee. Has the meaning specified in Section 13.02(b)(i) of the
Lease.
Majority in Interest of Certificate Holders. As of a particular date
of determination, the Holders of more than 50% of the aggregate unpaid
principal amount of all Certificates outstanding as of such date excluding for
purposes of this definition any Certificates held by (i) the Owner Trustee or
the Owner Participant or any interests of the Owner Participant unless all
Certificates then outstanding shall be held by the Owner Participant, (ii) the
Lessee or (iii) any Affiliate of any thereof.
Make-Whole Premium. An amount determined as of the day before the
applicable Prepayment Date (or date of purchase, as the case may be) which an
Independent Investment Banker determines to be equal to the excess, if any, of
(i) the present values of all remaining scheduled payments of such principal
amount or portion thereof and interest thereon (excluding interest accrued
from the immediately preceding Payment Date to such Prepayment Date or date of
purchase, as the case may be) to the Maturity of such Certificate in
accordance with generally accepted financial practices assuming a 360-day year
consisting of twelve 30-day months at a discount rate equal to the Treasury
Yield, all as determined by the Independent Investment Banker over (ii) the
unpaid principal amount of such Certificate.
Manufacturer. Airbus Industrie G.I.E., a groupement d'interet
economique formed under the laws of France, and its successors and assigns.
Maturity. With respect to any Certificate, the date on which the
final principal amount of such Certificate is scheduled to be due and payable.
Moody's. Moody's Investors Service, Inc.
Net Present Value of Rents. The net present value, as of the
Delivery Date, of Basic Rent set forth in Schedule II of the Lease, discounted
at a rate equal to the Debt Rate per annum compounded semi-annually.
Non-U.S. Person. Any Person other than a U.S. Person.
Obsolete Parts. Parts which are severable from the Aircraft in
accordance with clauses (ii) and (iii) of the proviso to Section 9.02(b) of
the Lease and the Lessee in good faith determines to be obsolete or no longer
suitable or appropriate for use on the Airframe or any Engine.
Officer's Certificate. When delivered pursuant to the Indenture, a
certificate signed by a Responsible Officer of the Lessee or the Owner
Trustee, as the case may be, and delivered to the Indenture Trustee. Each
such certificate shall include the statements provided for in Section 15.07 of
the Indenture.
Operative Agreements. The Participation Agreement, the Trust
Agreement, AVSA's FAA Bill of Sale, AVSA's Warranty Bill of Sale, the Airbus
Guaranty, the Purchase Agreement, the Purchase Agreement Assignment, the GTA,
the Engine Warranty Assignment, the French Pledge Agreement, the Lease, the
Lease Supplement, the Owner Participant Guaranty, if any, the Owner Trustee
Guaranty, if any, any Ancillary Agreement entered into by or with the written
consent of the Indenture Trustee, which by its terms is an Operative
Agreement, the Certificates outstanding at the time of reference, the
Indenture, the Indenture and Security Agreement Supplement, the Consent and
Agreement, the AVSA Consent and Agreement, the Consent and Guaranty (to the
extent assigned by the Purchase Agreement Assignment), the Engine Consent, the
Tax Indemnity Agreement and any Assignment and Assumption Agreement, each as
amended from time to time.
Opinion of Counsel. When delivered pursuant to the Indenture, 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) Davis Polk & Wardwell 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 or the
Indenture Trustee, an attorney selected by such Person and, in the case of the
Owner Trustee, reasonably satisfactory to the Indenture Trustee.
Outstanding. When used with respect to Certificates, as of the date
of determination and subject to the provisions of Section 10.04 of the
Indenture, all Certificates theretofore executed and delivered under the
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 the Indenture or otherwise;
(ii)Certificates for which prepayment 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 of the
Indenture; provided, that if such Certificates are to be prepaid,
notice of such prepayment has been duly given pursuant to the
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 and delivered pursuant to Article II
of the Indenture.
Owner Participant. The trustor originally named in the Trust
Agreement and any successor thereto, and any Person to which Owner Participant
transfers, in accordance with the Trust Agreement, its right, title and
interest in and to the Operative Agreements and the Lessor's Estate.
Owner Participant Guarantor. The provider of an Owner Participant
Guaranty.
Owner Participant Guaranty. Any guaranty delivered in compliance with
Section 7.03(d) of the Participation Agreement.
Owner Trustee. FSBU, not in its individual capacity except as
otherwise expressly stated, but solely as Owner Trustee under the Trust
Agreement, and its successors and permitted assigns.
Owner Trustee Guarantor. The provider of an Owner Trustee Guaranty.
Owner Trustee Guaranty. Any guaranty delivered in compliance with
Section 11.01(b)(ii) of the Participation Agreement.
Owner's Economic Return. The Owner Participant's anticipated net
after-tax book yield and aggregate after-tax cash during the Interim Term and
the Basic Term utilizing the multiple investment sinking fund method of
analysis, computed on the basis of the same methodology and assumptions as
were utilized by the Owner Participant in determining Basic Rent, Stipulated
Loss Value and Termination Value percentages, as the case may be, as such
assumptions may be adjusted for events which have been the basis of
adjustments to Rent pursuant to Section 3.04 of the Lease.
Participation Agreement. The Participation Agreement (Federal Express
Corporation Trust No. N669FE), dated as of June 1, 1996, among the Lessee, the
Owner Trustee not in its individual capacity except as otherwise expressly
provided therein, but solely as owner trustee, the Owner Participant, the
Indenture Trustee not in its individual capacity except as otherwise expressly
provided therein, but solely as indenture trustee and the Pass Through Trustee
not in its individual capacity except as otherwise expressly provided therein,
but solely as pass through trustee, as amended, modified or supplemented, or
the terms thereof waived.
Parts. All appliances, parts, components, instruments, appurtenances,
accessories, furnishings and other equipment of whatever nature (other than
complete Engines or engines) which may from time to time be incorporated or
installed in or attached to the Airframe or any Engine or title to which
remains vested in the Lessor pursuant to Article 8 of the Lease.
Pass Through Agreement. The Pass Through Trust Agreement dated as of
February 1, 1993, as amended and restated as of October 1, 1995 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 Certificates. Any of the 1996 Pass Through Certificates,
Series A1 or 1996 Pass Through Certificates, Series A2, in each case as issued
by the related Pass Through Trust; and "Pass Through Certificates" means both
of the Pass Through Certificates issued by each of the Pass Through Trusts.
Pass Through Closing Date. The Business Day on which the sale of the
Pass Through Certificates to the Underwriters pursuant to the Underwriting
Agreement takes place.
Pass Through Trust. The Federal Express Pass Through Trust, 1996-A1
or Federal Express Pass Through Trust, 1996-A2, in each case formed pursuant
to the related Series Supplement in accordance with the Pass Through
Agreement; and "Pass Through Trusts" means both of such Pass Through Trusts.
Pass Through Trustee. State Street Bank and Trust Company, a
Massachusetts trust company, in its capacity as Pass Through Trustee under the
Pass Through Agreement and each Pass Through Trust, and its successors and
permitted assigns as Pass Through Trustee thereunder.
Past Due Rate. In respect of (A) any amount payable to the Owner
Participant or the Owner Trustee a rate per annum during the period from and
including the due date to but excluding the date on which such amount is paid
in full equal to 2% plus the Debt Rate and (B) any principal of or interest on
any Certificate or any other amount payable under the Indenture, any
Certificate or any other Operative Agreement that is not paid when due
(whether at Maturity, by acceleration, by optional or mandatory prepayment or
otherwise) to any Holder, the Indenture Trustee or the Pass Through Trustee, a
rate per annum during the period from and including the due date to but
excluding the date on which such amount is paid in full equal to (i) in the
case of any such amount payable to the Holder of any Certificate, 2% plus the
interest rate applicable to such Certificate and (ii) in the case of any other
such amount, 2% plus the Debt Rate.
Payment Date. September 25, 2019 and each January 30 and July 30
commencing on July 30, 1996.
Payment Default. Any event specified in Section 16.01(a) or 16.01(b)
of the Lease which with the giving of notice or lapse of time or both would
constitute an Event of Default.
Permitted Investments. Those investments enumerated in Section
23.01(a) (i), (ii), (iii) and (iv) of the Lease.
Person. Any individual, sole proprietorship, partnership, joint
venture, joint stock company, trust, unincorporated organization, association,
corporation, institution, entity or government (federal, state, local, foreign
or any agency, instrumentality, division or body thereof).
Preliminary Notice. Has the meaning specified in Section 4.01(a) of
the Lease.
Premium Termination Date. With respect to the Certificates having a
Maturity in 2015, June 11, 2008 and with respect to the Certificates having a
Maturity in 2018, November 24, 2016.
Prepayment Date. Has the meaning specified in Section 6.02(b) of the
Indenture.
Prepayment Price. Has the meaning specified in Section 6.02(b) of the
Indenture.
Property. Any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
Proposed Termination Date. The proposed date of termination of the
Lease as specified by the Lessee in its notice given pursuant to Section 10.01
thereof.
Purchase Agreement. The Airbus A300-600R Freighter Purchase Agreement,
dated as of July 3, 1991 between AVSA and the Lessee, including all exhibits,
appendices and letter agreements attached thereto as originally executed or as
modified, amended or supplemented in accordance with the terms thereof, but
only to the extent that the foregoing relates to the Aircraft and to the
extent assigned pursuant to the Purchase Agreement Assignment.
Purchase Agreement Assignment. The Purchase Agreement Assignment
(Federal Express Corporation Trust No. N669FE), dated as of June 1, 1996
between the Lessor and the Lessee, as the same may be amended, modified or
supplemented from time to time.
Purchase Price. Has the meaning specified in Schedule IV to the
Participation Agreement.
Record Date. With respect to Payment Dates under the Indenture
(except a date for payment of defaulted interest), January 15 for January 30
Payment Dates and July 15 for July 30 Payment Dates, whether or not such date
is a Business Day.
Recourse Amount. Has the meaning specified in Section 17.10 of the
Participation Agreement.
Refinancing. A non-recourse loan to the Lessor arranged pursuant to
Section 15.01 of the Participation Agreement.
Register. Has the meaning set forth in Section 3.02 of the Indenture.
Registrar. Has the meaning set forth in Section 3.02 of the
Indenture.
Regulation D. Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
Remaining Weighted Average Life. 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 payment is scheduled to be
made, by (b) the then outstanding principal amount of such Certificate.
Renewal Rent. The amount payable by the Lessee as rent in accordance
with Section 4.01 of the Lease during any Renewal Term.
Renewal Term. One or more terms with respect to which the Lessee has
exercised its option to renew the Lease pursuant to Section 4.01(a) thereof.
Rent. All payments due from the Lessee under the Lease as Basic Rent,
Renewal Rent and Supplemental Rent, collectively.
Rent Payment Date. September 25, 2019 and each January 30 and July 30
commencing on July 30, 1996.
Reoptimization Date. Has the meaning specified in Section 15.02(a)
of the Participation Agreement.
Replacement Aircraft. Any aircraft substituted for the Aircraft
pursuant to Section 11.03(a) of the Lease.
Replacement Airframe. Has the meaning set forth in Section 11.03 of
the Lease.
Replacement Engine. A General Electric CF6-80C2-A5F engine (or an
engine of the same or another manufacturer) of equal or greater value,
airworthiness, remaining useful life and utility as the Engine being replaced,
together with all Parts relating to such engine; provided, however, that if
such replacement engine is not a General Electric CF6-80C2-A5F engine, such
replacement engine must then be commonly used in the commercial aviation
industry on Airbus A300-600 airframes.
Responsible Officer. With respect to the Owner Trustee (except for
purposes of the Trust Agreement in which case the definition of Responsible
Officer set forth in Section 3.10 of the Trust Agreement is applicable) or the
Indenture Trustee, any officer in its Corporate Trust Administration, as the
case may be, designated by such Person to perform obligations under the
Operative Agreements, and with respect to any other party, any corporate
officer or (except in the case of the Owner Participant) other employee of a
party who, in the normal performance of his or her operational
responsibilities, with respect to the subject matter of any covenant,
agreement or obligation of such party pursuant to any Operative Agreement,
would have responsibility for and knowledge of such matter and the
requirements of any Operative Agreement with respect thereto.
S&P. Standard & Poor's Ratings Group.
SEC. The Securities and Exchange Commission of the United States and
any successor agencies or authorities.
SSB. State Street Bank and Trust Company, a Massachusetts trust
company.
Scheduled Delivery Date. The Delivery Date specified in the Delivery
Notice pursuant to Section 3.01 of the Participation Agreement.
Securities Act. The Securities Act of 1933, as amended.
Series Supplement. The Series Supplement 1996-A1 to be executed and
delivered by the Lessee and the Pass Through Trustee or the Series Supplement
1996-A2 to be executed and delivered by the Lessee and the Pass Through
Trustee, in each case as such Series Supplement may be modified, supplemented
or amended from time to time in accordance with the provisions thereof and
"Series Supplements" means both such Series Supplements.
Sinking Fund Redemption Date. Has the meaning specified in Section
6.06 of the Indenture.
Sinking Fund Redemption Price. Has the meaning specified in Section
6.06 of the Indenture.
Special Aviation Counsel. Daugherty, Fowler & Peregrin.
Specified Investments. Shall mean (a) direct obligations of the
United States of America or obligations fully guaranteed by the United States
of America; (b) commercial paper rated A-1/P-1 by Standard & Poor's Ratings
Group and Moody's Investors Service, Inc., respectively or, if such ratings
are unavailable, rated by any nationally recognized rating organization in the
United States equal to the highest rating assigned by such voting
organization; (c) overnight federal funds transactions with members of the
Federal Reserve Systems arranged by federal funds brokers; and (d) overnight
repurchase agreements with respect to the securities described in clause (a)
above entered into with an office of a bank or trust company which is located
in the United States of America of any bank or trust company which is
organized under the laws of the United States or any state thereof and has
capital surplus and undivided profits aggregating at least $500 million.
Stipulated Loss Value. As of any Stipulated Loss Value Determination
Date during the Basic Term, the amount determined by multiplying the Purchase
Price by the percentage set forth in Schedule III of the Lease under the
heading "Stipulated Loss Value Factor" opposite such date (as such Schedule
III may be adjusted from time to time as provided in Section 3.04 of the
Lease), and during any Renewal Term, the amount determined pursuant to Section
4.01(b) of the Lease. Notwithstanding any other provisions of the Lease or
the Participation Agreement or the Indenture, each Stipulated Loss Value for
the Aircraft shall be, under any circumstances and in any event, an amount,
together with so much of the arrears portion of Basic Rent due and owing
through the date of payment of Stipulated Loss Value as does not constitute an
Excepted Payment, at least sufficient to pay in full as of such date of
payment the aggregate unpaid principal amount of and accrued interest on the
Certificates outstanding on such date of payment. Subject to the immediately
preceding sentence, it is understood and agreed that the amounts set forth on
Schedule III of the Lease, for dates other than Rent Payment Dates on which
arrears Basic Rent is due, fully reflect appropriate Basic Rent accruals and
credits of unearned Basic Rent through such date and, accordingly, no further
accrual or credit shall be required through such date whenever Stipulated Loss
Value is to be calculated with reference to any such date; provided that if
amounts in respect of Stipulated Loss Value are payable under the Operative
Agreements after the Stipulated Loss Determination Date in respect of which
such Stipulated Loss Value was determined, the Lessor shall be compensated
during the period from the Stipulated Loss Determination Date to such payment
date in accordance with the provisions of the Operative Agreements.
Stipulated Loss Value Determination Date. Each date set forth on
Schedule III of the Lease under the heading "Stipulated Loss Value Date."
Supplemental Rent. All amounts, liabilities and obligations which
the Lessee assumes or agrees to perform or pay under the Lease or under the
Participation Agreement or Tax Indemnity Agreement or any Ancillary Agreement
or any other Operative Agreement to the Lessor, the Owner Participant, the
Indenture Trustee or others, including, without limitation, payments of
Stipulated Loss Value, FPO Price and amounts calculated by reference to
Termination Value, any amounts of Make-Whole Premium payable under the
Indenture to the extent provided in Section 3.03 of the Lease, and all amounts
required to be paid by Lessee under the agreements, covenants and indemnities
contained in the Lease or in the Participation Agreement or the Tax Indemnity
Agreement or any other Operative Agreement, but excluding Basic Rent.
Tax. Has the meaning set forth in Section 8.01(a) of the
Participation Agreement.
Tax Indemnity Agreement. The Tax Indemnity Agreement (Federal
Express Corporation Trust No. N669FE), dated as of June 1, 1996, between the
Lessee and the Owner Participant, as from time to time modified, amended or
supplemented pursuant to its applicable provisions.
Term. The Interim Term and the Basic Term of the lease for the
Aircraft under the Lease and, if renewed pursuant to Section 4.01 of the
Lease, each Renewal Term for the Aircraft for which the Lease is renewed, or
such earlier date on which the Lease is terminated pursuant to its terms.
Termination Date. A Rent Payment Date during the Basic Term that is
on or after December 31, 2003 in the case of Article 10 of the Lease, and in
the case of (i) Section 4.02(a)(A) of the Lease, the Rent Payment Date falling
on July 30, 2017, (ii) Section 4.02(a)(D) or (E) of the Lease, a Rent Payment
Date that is on or after the seventh anniversary of the Commencement Date and
(iii) Section 4.02(a)(F) of the Lease, the last day of the Basic Term.
Termination Value. As of any Termination Date, the amount determined
by multiplying the Purchase Price by the percentage set forth in Schedule IV
of the Lease under the heading "Termination Value Factor" opposite such
Termination Date (as such Schedule IV may be adjusted from time to time as
provided in Section 3.04 of the Lease). Notwithstanding any other provisions
of the Lease, the Participation Agreement or the Indenture, each Termination
Value shall be, under any circumstances and in any event, an amount, together
with so much of the arrears portion of Basic Rent due and owing through the
date of payment of any amount calculated by reference to Termination Value as
does not constitute an Excepted Payment, at least sufficient to pay in full as
of such date of payment the aggregate unpaid principal amount of and accrued
interest on the Certificates outstanding on such date of payment. Subject to
the immediately preceding sentence, it is understood and agreed that the
amounts set forth on Schedule IV of the Lease, for dates other than Rent
Payment Dates on which arrears Basic Rent is due, fully reflect appropriate
Basic Rent accruals and credits of unearned Basic Rent through such date and,
accordingly, no further accrual or credit shall be required through such date
whenever Termination Value is to be calculated with reference to any such
date; provided that if amounts in respect of Termination Value are payable
under the Operative Agreements after the Termination Date in respect of which
such Termination Value was determined, the Lessor shall be compensated during
the period from the Termination Date to such payment date in accordance with
the provisions of the Operative Agreements.
Transaction Costs. Those costs and expenses set forth in Section
10.01(a) of the Participation Agreement.
Transportation Code. Title 49 of the United States Code, as amended
and in effect on the date of the Lease or as subsequently amended, or any
successor or substituted legislation at the time in effect and applicable, and
the regulations promulgated pursuant thereto.
Treasury Yield. (i) In the case of a Certificate having a Maturity
within one year after the Prepayment 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 Prepayment 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 source
deemed comparable by the Independent Investment Banker selected to determine
the Make-Whole Premium and reasonably acceptable to the Lessee) corresponding
in maturity to the Remaining Weighted Average Life of such Certificate (or, if
there is no corresponding maturity, an interpolation of maturities by the
Independent Investment Banker), in each case determined by the Independent
Investment Banker selected to determine the Make-Whole Premium based on the
average of the yields to stated maturity determined from the bid prices as of
10:00 a.m. and 2:00 p.m. New York time, on the second Business Day preceding
the Prepayment Date.
Trust Agreement. The Trust Agreement (Federal Express Corporation
Trust No. N669FE), dated as of June 1, 1996, between the Owner Participant and
the Owner Trustee in its individual capacity, as from time to time modified,
amended or supplemented pursuant to its applicable provisions and in
accordance with the Operative Agreements.
Trust Estate. The Lessor's Estate.
Trust Indenture Act. The Trust Indenture Act of 1939, as amended.
Trust Indenture Estate. All estate, right, title and interest of the
Indenture Trustee in and to any of the property, rights, interests and
privileges granted to the Indenture Trustee pursuant to the Granting Clause of
the Indenture, other than Excepted Payments and any and all other rights of
the Owner Trustee or the Owner Participant expressly reserved to the Owner
Trustee or the Owner Participant pursuant to the Indenture.
Underwriters. Goldman, Sachs & Co., J.P. Morgan Securities Inc. and
Morgan Stanley & Co. Incorporated.
Underwriting Agreement. The Underwriting Agreement dated June 5, 1996
among the Lessee and the Underwriters.
United States, U.S. or US. The United States of America.
U.S. Air Carrier. Any United States air carrier as to which there is
in force a certificate issued pursuant to Section 41102(a) or Section 41103 of
the Transportation Code, and as to which there is in force an air carrier
operating certificate issued pursuant to Chapter 447 of the Transportation
Code and Part 121 of the regulations under such Transportation Code, for
aircraft capable of carrying ten (10) or more individuals or 6,000 pounds or
more of cargo, or which may operate as an air carrier by certification or
otherwise under any successor or substitute provision thereof or in absence
thereof.
U.S. Person. A Person described in Section 7701(a)(30) of the Code.